Building Trades News

Energy Policy and Incomes

By Richard Slawson, Executive-Secretary

What’s new – the oil companies are screwing craft families twice while Bush & company fiddle. The President and Congress are failing America with their total refusal to enforce regulatory policy on any business and one of the results is a man made crisis in gasoline supplies. Every working family is seeing their living standard eroded as the price of transportation has increased by 50% in the last year. With the average family having two cars the costs transportation are taking up more than 20% of their incomes. Over 10% just for gas. Families are seeing their incomes shrink as cost escalate at a rapid pace while Oil companies’ profits are at all time highs. Profits are wonderful. Profits are what business is all about, however, in the midst of crude oil prices tripling over 12 months, and gasoline prices at the pump doubling, profits in the billions for the five major oil companies is insane. Clearly, in the last 5 years, corporations have had a free hand in reducing competition. The craftsmen and women here in the Los Angeles and Orange County area have watched as national and international oil companies have fought, taken over, bought and sold between themselves until we have Exxon/Mobil, Texaco/Chevron, Conaco/Phillips owning 4 of the 5 largest refineries in the area. Add to that the takeover of Arco by British Petroleum and you can see that what is happening is the Wal-Martization of the oil industry. No wonder that oil profits are up – fewer oil companies mean higher profits. President Benjamin Harrison took on businesses in America in a time that they were owned by “Robber Barons.” These were men who destroyed the competition though any means available. They threatened smaller business owners, forced other businesses to refuse to do business with them, undercut their prices with predatory pricing schemes, and when that didn’t work they bought them out. This was all done to give them the ability to control their industry and through this control set their own prices and profits. That was when Harrison signed the Sherman Anti-Trust Act in 1890, which allowed the government to intervene in businesses worst ideas. Today, there are no examples of the government enforcing laws against trusts – the takeover of whole segments of our economy for the enrichment of the few at the expense of every other citizen. With oil and gasoline prices continuing to skyrocket we should expect that the federal government would at least be investigating the industry and holding hearings where oil company CEOs could be asked the questions that would expose the negative results of years of their trust building and inaction by the government. But, with Bush & Company controlling the legislative and executive branches nothing is happening. A year ago, when oil company executives where brought before the Republican controlled Congress they were not even swore in, where if they had they could have been indicted for perjury for lying before Congress. Of course they had nothing to say and were not asked any difficult questions. Every one of the oil company CEOs who testified, professed to be operating their company in the best interest of the Country. After you watched this act for a few minutes it became obvious that they were running their companies in the best interest of themselves. They explained that their excessive company profits were no different than every other industry. This, they said was just a function of the amount of sales that they had. We know better! Just because their profits are 5 percent of sales or less, it doesn’t mean that they are being honest. The experts in this Country know that the Exxon/Mobil profits of 8.4 billion dollars are excessive no matter what. So what can be done? There have been legislative proposals to cap excess profits, including Congressman Dennis Kucinich’s HR 2070, that would place an excessive profit tax on gasoline sales over a targeted amount established by the government, and a long list of other legislation targeting excess profits. In the U.S. Senate, Senator Byron Dorgan from North Dakota has Senate Bill 1621, the “Windfall Profits Rebate Act of 2005 that was introduced last September when gasoline prices and oil company profits began to go through the roof. All of these efforts are good in intent, but in the long term I believe that there is only one way to control the price gouging that is onging. The federal government should regulate the oil industry by declaring it a “public utility.” This would allow the establishment of Industry Boards that would monitor production, set pricing and control distribution as we have natural gas, water and electrical power for over 70 years. We should begin today to petition our legislators to institute a new American Energy Policy with regulation as the main component. If we don’t, the oil industry will continue to manipulate us without regard for our costs just to make even more unconscionable profits.

 

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