Wednesday, November 09, 2005

Those who Fail History are doomed to Repeat It.
Congress has decided that what the consumers need to lower the burden of high oil prices are high taxes on oil. These ideas range from very stupid (a tax on profits in excess on x billion dollars) to potentially lethal (a tax on all barrels of oil sold for more than $40 a barrel). At the very least these measures will do nothing to lower oil prices in the short-term and raise the prices later by eliminating incentive for new exploration. But the most probable outcome is that oil companies have no buisness activities in the U.S. to avoid the tax and the Senators who voted their conscience and stuck it to the oil companies will make speeches railing against outsourcing. In fact since oil prices are based on supply and demand and not especially on the cost of drilling and refining it will have wide variance in its profits. Therefore if you cut the highs by a 1/3 extra say then they will have to reduce the lows also. The way to do this is to limit supply to the U.S. to avoid the tax (assuming no loopholes) or put all your costs there to lower profits. So possibly this will eliminate tax revenue or maybe raise gas prices. But then again for the Dems it could bring us one step closer to solar power.


At 11:44 AM, Blogger Tobie said...

wouldn't 'those who forget history' make a lot more sense in this context? Besides being the original quote, I think you can only 'fail' history in an acedemic context. Otherwise, you are just failing, in general.

At 2:27 PM, Blogger Mike said...

Stop nit-picking

At 7:31 PM, Blogger Shmuli said...

The phrase also brings with it the implication that you will present historical evidence to butress your argument.


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