GINA COBB

Are Biofuels Causing Starvation in Africa? Maybe Not

Don Surber makes a pretty good case that corn ethanol is not the primary reason for starving children in Africa.  It's fresh thinking on an important topic.  Check it out.

Two Years Ago Today on GINA COBB: Good Way to Ensure High Gas Prices

Originally published on April 27, 2006:  Good Way to Ensure High Gas Prices

Here's a good way to ensure high gas prices: 

When oil company profits are normal, ignore them.  But do enact reams and reams of legislation and regulations so that you make it difficult for oil companies to jump through all the hoops without extraordinary care and expense.  This will discourage new companies from entering the business.

If an oil company finally makes an outstanding profit one year, don't congratulate the company for having successfully navigated its way through the thicket of regulations and for actually providing a product while realizing excellent profits for the benefit of its shareholders and employees -- a "win-win" if ever there was one.

Instead, disparage the company for making "too much" profit (even though making profits and maximizing profits is the entire purpose of existence for any for-profit company.) 

Call company executives before Congress for a public grilling.  Accuse them of price "gouging" in the media (and everywhere else).  Ignore the fact that combined state and federal taxes on gasoline are several multiples of oil company profits. 

Treat the oil company executives like criminals; in fact, scour the law books looking for any way to sock it to them.

And, last but certainly not least, impose extra taxes to take away some of their profits.

If we follow this plan carefully, next time anyone even thinks about entering the oil business, they'll realize it's not worth it.  Who in their right mind ever starts a for-profit business in the hopes that they will never realize more than mediocre profits, and that they cannot ever enjoy excellent profits without abuse and demands to turn over the profits to someone else?  Who is crazy enough to go into business knowing that if they ever succeed well enough to reap excellent profits, their hard-earned profits will be taken away?   Why bother?

And if all of your efforts have their inevitable effect and nobody new is interested in entering the oil business, leaving only a few suppliers to deal with all that demand, what do you suppose will happen to oil prices?

A high profit is not a crime.  It's not even a bad thing.  When profits are high, new companies are encouraged to enter the fray and compete for your business.  When enough companies enter an industry, prices inevitably fall based on the reliable economic law of supply and demand.

Here are some things that might actually reduce gas prices:  Open up domestic oil production.  Suspend non-essential environmental regulations.  Let the oil companies enjoy their profitable year.  Review the regulatory scheme and remove unnecessary barriers to entry of new companies into the oil business.  Conserve energy.  Try out some of the alternatives to using lots of gasoline, such as telecommuting, combining errands, working a four-day week instead of a five-day week, and the like.  Be a little bit more price-sensitive in deciding how much you are willing to pay for gas.

There are many ways to make the situtation better.  But biting the hand that feeds your gas tank is not one of them.  That's just bad manners, and nothing good will come from it.

Originally published on April 27, 2006:  Good Way to Ensure High Gas Prices

Here's a good way to ensure high gas prices: 

When oil company profits are normal, ignore them.  But do enact reams and reams of legislation and regulations so that you make it difficult for oil companies to jump through all the hoops without extraordinary care and expense.  This will discourage new companies from entering the business.

If an oil company finally makes an outstanding profit one year, don't congratulate the company for having successfully navigated its way through the thicket of regulations and for actually providing a product while realizing excellent profits for the benefit of its shareholders and employees -- a "win-win" if ever there was one.

Instead, disparage the company for making "too much" profit (even though making profits and maximizing profits is the entire purpose of existence for any for-profit company.) 

Call company executives before Congress for a public grilling.  Accuse them of price "gouging" in the media (and everywhere else).  Ignore the fact that combined state and federal taxes on gasoline are several multiples of oil company profits. 

Treat the oil company executives like criminals; in fact, scour the law books looking for any way to sock it to them.

And, last but certainly not least, impose extra taxes to take away some of their profits.

If we follow this plan carefully, next time anyone even thinks about entering the oil business, they'll realize it's not worth it.  Who in their right mind ever starts a for-profit business in the hopes that they will never realize more than mediocre profits, and that they cannot ever enjoy excellent profits without abuse and demands to turn over the profits to someone else?  Who is crazy enough to go into business knowing that if they ever succeed well enough to reap excellent profits, their hard-earned profits will be taken away?   Why bother?

And if all of your efforts have their inevitable effect and nobody new is interested in entering the oil business, leaving only a few suppliers to deal with all that demand, what do you suppose will happen to oil prices?

A high profit is not a crime.  It's not even a bad thing.  When profits are high, new companies are encouraged to enter the fray and compete for your business.  When enough companies enter an industry, prices inevitably fall based on the reliable economic law of supply and demand.

Here are some things that might actually reduce gas prices:  Open up domestic oil production.  Suspend non-essential environmental regulations.  Let the oil companies enjoy their profitable year.  Review the regulatory scheme and remove unnecessary barriers to entry of new companies into the oil business.  Conserve energy.  Try out some of the alternatives to using lots of gasoline, such as telecommuting, combining errands, working a four-day week instead of a five-day week, and the like.  Be a little bit more price-sensitive in deciding how much you are willing to pay for gas.

There are many ways to make the situtation better.  But biting the hand that feeds your gas tank is not one of them.  That's just bad manners, and nothing good will come from it.

Ethanol Mandate Driving Up Fuel Prices

From the editors of National Review Online:  Cut food prices -- repeal the ethanol mandate.

Here's a useful rule of thumb:   When things are badly out of whack, there's usually a whacky law to blame. 

The free market is a wonderful thing.  Mess with it at your peril.

Death of Obama/Hillary's Socialism in Two Graphs

By DemocracyRules

This type of poster is familiar to us.  Many Socialists claim that we are experiencing a global "Crisis of Capitalism".  To Marx, "The real barrier of capitalist production is capital itself."  More than 150 years ago he was certain that  capitalism would destroy itself.

More than any other single image, the GDP graph below shows what has really happened since Marx/Engels wrote "The Communist Manifesto" (1848).  (click on the graph to enlarge it).  Time and time again, the Socialists' relentless predictions of an imminent Crisis of Capitalism have proved false.  Instead, since the beginning of the Industrial Revolution, a capitalist project, world GDP began to grow strongly, and it continues to rise exponentially.   

Reagan was right, wealth begets wealth. Scientific and technological change cause compounding economic growth.  More and more opportunity and wealth are created worldwide.  Thus, the graph shows the continuing miracle of capitalism.  World GDP per person did not measurably improve from 1 AD to 1000 AD.  But in the middle of the 1800's as the Industrial Revolution started, World GDP began to rise at a compounding rate.  In 2007,  world GDP growth was 5.2%.  That year Gross World Product was approximately $65.82 trillion.

But you might say, world GDP is growing, but so is population, maybe the poor are getting poorer?  Not so, according to this  graph.  Click to enlarge.  The graph is similar to the last one, showing a rapid rise in the last part of the graph.  But the rise is population growth.  The interesting thing is the size of the bubbles, which represent GDP per person.  The bubbles are getting bigger because GDP per person is increasing, reaching $6055 per person in year 2000.

Take that you silly Socialists.  Hillary and Obama have no excuse whatsoever to convert the USA into a Socialist state.  Worldwide, both the poor and the rich are better and better off because of capitalism.

Yes Indeed

Has Obama Ever Heard of Killing the Golden Goose?

Don't miss Phyllis Schlafly's latest column about a very bad bill introduced by Barack Obama, the Global Poverty Act (S. 2433):  Congress Contemplates Giving Cash to Foreigners.  An excerpt from Schlafly's column is below.  But first, my reaction. 

Eliminating global poverty is a noble goal, but the way to do that is not to hand cash to social planners and dictators around the world who have run their nations' economies into the ground.  America's strength is in its living free markets, not in some lifeless pile of money. 

For people who don't understand the source of wealth, it seems very logical to correct poverty by taking money from one group or nation and handing it to another.  The problem is that if you do that often enough you run both nations into the ground.  You squelch incentives in the "donor" nation and in the "recipient" nation as well.  Besides, poverty is a moving target.  You will never eliminate poverty because there will always be some who have more and some who have less.

American taxpayers are already providing free health care, schools, cash and social services to every immigrant who finds his way across a border, legally or illegally.  The strain on America's taxpayers, schools, hospitals and prisons is already great. 

Now Americans are supposed to support all 6.6 billion people on earth?  The United States is reasonably wealthy, but not that wealthy.  You can only pluck so many feathers from the golden goose before it dies.

One Year Ago on GINA COBB: The Deadly Human Cost of Environmentalist Overkill

Originally published on February 23, 2007

The Deadly Human Cost of Environmentalist Overkill

Suzanne Fields has an interesting article at RealClearPolitics with some more "inconvenient truths" for Al Gore and environmentalists generally -- some that I had not heard before. 

Did you know that environmentalist objections to DDT, asbestos, and large steel and concrete "sea gates" have each ended up taking a human toll?:

But when politics, fashion and entertainment fuse with scientific "factoids," truth drowns in a flood of misinformation. In his new book, "Eco-Freaks," John Berlau, a policy director at the Competitive Enterprise Institute, a think tank devoted to environmental policies, catalogs the tragic mistakes imposed on the rest of us by the environmentally correct. After Rachel Carson published "Silent Spring," DDT was banned nearly everywhere. Most of her "evidence" later turned out to be all wrong, but 2 million poor Africans die every year of malaria that DDT was on the way to eradicating. Al Gore, of course, blames global warming.

Asbestos, like DDT, gets a bad rap in the popular media, but nothing else comes close as a shield against heat. The original plans for the World Trade Center called for the interior steel in both towers to be covered with asbestos-based fireproofing material. Asbestos was eliminated when environmentalists objected. Engineers think the twin towers might be standing today but for the politically correct construction. Asbestos would have at least slowed the spread of the fire and the melting of the metal, giving hundreds of those who perished a chance to escape.

Suzanne Fields has an interesting article at RealClearPolitics with some more "inconvenient truths" for Al Gore and environmentalists generally -- some that I had not heard before. 

Did you know that environmentalist objections to DDT, asbestos, and large steel and concrete "sea gates" have each ended up taking a human toll?:

But when politics, fashion and entertainment fuse with scientific "factoids," truth drowns in a flood of misinformation. In his new book, "Eco-Freaks," John Berlau, a policy director at the Competitive Enterprise Institute, a think tank devoted to environmental policies, catalogs the tragic mistakes imposed on the rest of us by the environmentally correct. After Rachel Carson published "Silent Spring," DDT was banned nearly everywhere. Most of her "evidence" later turned out to be all wrong, but 2 million poor Africans die every year of malaria that DDT was on the way to eradicating. Al Gore, of course, blames global warming.

Asbestos, like DDT, gets a bad rap in the popular media, but nothing else comes close as a shield against heat. The original plans for the World Trade Center called for the interior steel in both towers to be covered with asbestos-based fireproofing material. Asbestos was eliminated when environmentalists objected. Engineers think the twin towers might be standing today but for the politically correct construction. Asbestos would have at least slowed the spread of the fire and the melting of the metal, giving hundreds of those who perished a chance to escape.

The Utopia of Nationalized Healthcare in Britain

More fun, fun, fun in Britain's nationalized health care system -- you know, the same kind of system that Democrats want to bring to America.

Incredible as it may seem, many patients in Brtain are denied life-saving treatments because the nationalized health care system just can't afford it.  For patients who are denied treatment, what options are left?  They can try to pay for some treatment themselves, but the government health care system may also slap them down for it.  From the New York Times:

So Much For That Dumb Idea: Chavez Will Not Halt U.S. Oil Exports

by DemocracyRules

Last week, Chavez pounded tables and things, and threatened to cut off shipments to the U.S. because he was mad at Exxon Mobile.   He had grabbed some of their Venezuelan projects.  Then Exxon got the courts to freeze about  $12 billion in Venezuelan assets abroad.  He may still try to cut off Exxon from buying Venezuelan oil, but that would not significantly affect Exxon.  They buy worldwide.

However, today he says, "We don't have plans to stop sending oil to the United States... [but we would if the U.S.] attacks Venezuela or tries to harm us."   

Chavez nationalized petroleum areas in the Orinoco River basin last year.  They contain heavy oil, which is not easy to refine.  Exxon Mobil ceased heavy-oil upgrading operations in the Orinoco basin after Chavez changed the terms of the contract.  Several other oil companies have stayed as minority partners, but it’s risky to stay.  Chavez has threatened to impose a new tax on them.

As I said earlier, Chavez can’t afford to cut off the U.S. because it takes years to set up new steady customers, and heavy oil is a less desirable product.  American refineries are already set up to handle it.

Right now, the U.S. gets about 11% of her oil from Venezuela.

Pro Patria

Government Healthcare: Wait in the Ambulance 5 Hours

Britons are waiting in ambulances outside emergency rooms for up to FIVE hours, just to help emergency rooms meet their goal of treating patients within FOUR hours.  "Figures obtained by the Liberal Democrats show that last year 43,576 patients waited longer than one hour before being let into emergency units. "

Of course, that means the ambulances are unavailable to answer other emergency calls.

What could possibly go wrong?

(Via Don Surber)

Rags to Riches Reality Check

Could you start out homeless with $25 in your pocket and build a decent life for yourself -- an apartment, a car, and some savings -- in less than a year?

This guy did.

(Via Conservative Grapevine)

Chavez Halts Sales To Exxon In Meaningless Gesture

by DemocracyRules

Sources: OilWeek, MarketWatch

Chavez has halted oil supplies to Exxon Mobil in an empty effort to be nasty.  Previously he seized two Exxon oil projects in Venezuela, so Exxon has had $12 billion in Venezuela's foreign assets frozen. 

Chavez then threatened to cut off all oil shipments to the U.S.  That’s impractical because it would take him a years to set up smooth sales arrangements with other countries.  He may never completely halt Venezuelan oil supplies to the U.S.  Venezuela sells most of it's oil to the US, but this amounts to only about 11% of U.S. consumption. 

Because Venezuelan oil is heavier grade high-sulfur oil, it requires more refining than other crude, and Chavez will have difficulty selling it. He could sell to China or India, but he will have to pay to ship it around South America at his own expense.  Supertankers are too big for the Panama canal.  Also, the US is better set up to refine Venezuela’s crude than China and India.

Cutting off oil supplies to Exxon Mobil does nothing except make Chavez into 'un buffon' .  Exxon bought about 2.6 million barrels from Venezuela in November, but Exxon buys many types of oil worldwide, and they can buy elsewhere.  Exxon will benefit by sourcing their oil from other places.  Exxon shares rose 52 cents to $84.90 on Wednesday.

Canada is rapidly ramping up oil supplies to the US.  Also notice Bush's recent close attention to Africa.  West African countries like Angola have huge offshore oil reserves that are mainly untapped.

Softening oil demand will also hurt Chavez.  The International Energy Association just predicted that 2008 world oil demand will increase less than expected.  Thus, world oil supplies will increase and prices will soften.  When it's cheaper and more plentiful, world oil consumers prefer the best quality cheapest oil from a safe supplier.  Chavez is a non-favored supplier because his oil is not very good and he is an unstable untrustworthy rotten person.

Pro Patria

Chavez Threatens to Halt Oil Sales to US

By DemocracyRules
Hmm...

This could be a blessing in disguise actually:

New Canadian Nuclear Power Station in Works For US Energy Export

New Canadian ACR-1000 Advanced Candu Reactor Cheaper, Faster, Safer, Better

New CANDU Nuclear Reactor planned for Alberta to provide heat for oil sands extraction

Solar Energy Now Cheaper Than Coal and Falling

Nanosolar 'prints' first flexible solar cells

Toshiba's new SCiB battery charges in 5 minutes, to be released in March 2008 for electric vehicles

Lithium Technology’s new battery pushes Toyota Prius to 125 MPG

No Real Worldwide Oil Shortage Seen, Iraq Set To Boost Production

US has been planning around Venezuela oil interruptions for years because of greasy little dweeb Chavez

In Jan 2005, Senator John McCain said the U.S. needs to develop alternate energy suppliers to avoid being held hostage by Chavez and other foreign leaders who control oil supplies.                  

"We better understand the vulnerabilities that our economy and our very lives have when we're dependent on Iranian mullahs, and whackos in Venezuela,'' McCain said in a Jan. 22 interview on Fox News Sunday.           

 

Bill Gates Believes Economy Will Strengthen

He thinks the economy will avoid a slump because growth in new technologies will keep it growing, he said to the German newspaper Bild.

He thinks the flux in the global markets will abate.  Gates said, "The US economy has been very strong in the last 10 to 15 years. Unfortunately I don't have a crystal ball to see into the next few years... But I am an optimist. The US economy could remain strong in the next few years because technological progress will propel it."

And Don't Forget to Seize Control of the Means of Production

By DemocracyRules

Hillary, unmedicated.  NYT interview:

It's long and boring, but here is the gist:  She is skeptical about free trade and other aspects of a free-market economy...  she talks about irresponsibility in corporate America and the government.

She thinks income inequality is growing. "[F]rom 1946 to 1973, the pay of most workers rose steadily... the share of workers in labor unions grew, allowing workers to win raises and benefits that they can rarely win on their own".

She thinks technological change is bad because it "eliminated the need for many blue-collar jobs".  She thinks global trade is holding down wages. 

Her first priority is to increase taxes on the rich.  She thinks increasing high-end tax rates would increase revenue by $52 billion a year, which she would spend on various projects.

She wants to increase regulation.  "I just believe strongly that we are in great need of a total overhaul," she said, arguing that the Bush administration has outsourced too many functions and damaged the federal government’s competence.

She wants to fix mortgage problems by banning foreclosures and freezing interest rates on sub-prime mortgages.  She says she can "understand totally" the frustration of people who did not take out such loans and now wonder why the government would help those who did.  But she will do it anyway.

"[I]f you really believe you have to manage the economy," she said.

Go Fred!

Tax Time Coming -- Accountant Alert

By DemocracyRules
h/t Austin

How to Understand Accountants - Take 4

An accountant was crossing a road one day when a frog called out to him and said, "If you kiss me, I'll turn into a beautiful princess".

He bent over, picked up the frog and put it in his pocket.  The frog spoke up again and said, "If you kiss me and turn me back into a beautiful princess, I will stay with you for one week".

The accountant took the frog out of his pocket, smiled at it and returned it to the pocket. The frog then cried out, "If you kiss me and turn me back into a princess, I'll stay with you and do ANYTHING you want."

Again he took out the frog, smiled at it and put it back into his pocket. Finally, the frog asked, "I'm a beautiful princess, and I'll stay with you and do anything you want.  What's the matter?"

He said, "Uh, a frog-to-princess transformation would attract tremendous capital gains tax, and wives are depreciating assets, but a talking frog is really neat."