Gas prices and the Arctic

I was listening to a report on NPR this morning about the Congressional hearings at which the heads of the big oil companies were called to testify. The senators gassed on about the impact of the high cost of oil on American families -- the impact on families is true enough but they should have thought of that before starting a war in the Middle East that both consumes a lot of oil and raises uncertainty in the region -- and the first (reported) response from an oil executive -- if we'd only let them drill more places in the U.S. all of this wouldn't be happening.

It made me think -- is part of the rising price gas (and the tolerance of it by the White House and others in Washington) a plan to make the pain at the pump intense enough that Americans drop their opposition to drilling in the Artic National Wildlife Refuge and other environmentally sensitive spots?

The people I know in the oil business realize that they are in the energy business, that fossil fuels are only part of the answer, and that U.S. reserves are too tiny to provide a long-term solution. However, I only know people at one big energy company well and they've been out front in talking about strategic energy interdependence and the need for alternatives to fossil fuels. Needless to say this wasn't the company quoted in the story.

Many, many in the oil business drool at the thought of drilling in the Artic and off our coasts. I don't want to claim a vast oil-wing conspiracy, but I wouldn't put it past these companies to try to take advantage of any opportunity to finally get what they have lusted after for years.

The Big Squeeze

Tom Ashbrook had the NY Times' Steven Greenhouse on OnPoint today to discuss Greenhouse's new book, The Big Squeeze: Tough Times for American Workers. It was an interesting discussion that is worth a listen.

It isn't hard to see that American capitalism is broken. We're extracting more at the top (a significantly greater percentage of income goes to the top one percent of earners than did 20 years ago) while retirement and health care coverage have become less secure. Income disparities are growing while social mobility is decreasing.

Markets can be wonderful but they are not perfect. I'm working on an essay on the myth of free markets and the unfortunate consequences of thinking that supply-and-demand are infallable and predictable forces, that unfettered competition is always beneficial, and that efficiency is always desireable. Watch this space for more soon. In the meantime, check out Greenhouse -- he's put together some compelling work.