Am I Missing Something?
As we look expectantly to the new Presidential candidates for answers, Barack Obama has offered one wonderful suggestion to the energy crisis: “I'll make oil companies like Exxon pay a tax on their windfall profits, and we'll use the money to help families pay for their skyrocketing energy costs and other bills" (as quoted on marketwatch.com). Wow. That turns my stomach a little bit. The language is nauseating. Instead of solving the problem of high oil prices, Obama (personally, apparently, he used the personal pronoun “I”) will take money from one party and give it to another party so they can pay others, including the former. This seems to simply shift money around and totally avoid dealing with the real issues, such as Middle East conflict, offshore drilling and developing alternative resources.
Additionally, Obama’s statement reveals that we are missing the information that the high oil prices are conveying. The prices of oil and profits of oil companies tell us that they’ve found a strong demand and are responding. We don’t complain that Apple is taking advantage of our love for music by charging $300 for an Ipod, yet we use this logic for oil. Don’t tell me we don’t have a choice either; our demand for oil is not entirely inelastic. You’ve heard it a thousand times: if you really can’t pay for gas, walk, carpool, or take the bus. Seriously. I do everyday, and sure it takes longer and I can’t blast my radio and sing at the top of my lungs during the commute, but it’s saving me money. Not until the demand for oil decreases significantly will the prices respond. Perhaps, if demand decreases enough, not only will prices follow, but it could really force us to find alternative energy sources, which is not a bad thing.
There are so many more ways Obama's statement is problematic. I haven’t even addressed how Exxon-Mobil already pays a whopping 30 billion dollars in taxes (money.cnn.com), the role taxes have on incentives, or the ‘success’ of similar taxation in 1980 under Jimmy Carter. At the same time, I clearly, just like the average voter, can’t begin to understand the complexities of the oil market or tax policy. However, I can ask questions when I don’t understand, and Obama's solution seems insufficient. I will not be satisfied with a president who blindly blames the big oil companies and slaps on another tax. I hope other average voters won’t be either.