It's an election year, so here goes Congress, demonstrating its stupidity again. And look who's leading the way: frightened Republicans, led by the always dull-witted Arlen Specter.
Senior executives from major oil companies underwent a grilling yesterday at a Senate hearing, where lawmakers from both parties blamed mergers for boosting energy prices and threatened to press ahead with legislation aimed at stiffening the antitrust rules governing the industry.The hearing at the Senate Judiciary Committee marked an escalation in Congress's efforts to show that it is cracking down on the oil giants as the industry is reaping record profits and voters remain angry about high prices for gasoline and natural gas. In a symbol of senatorial high dudgeon, the six executives appearing before the panel were sworn in, something they did not have to undergo when they were hauled before another Senate panel in November.
Spearheading the attack on the industry was the committee's chairman, Sen. Arlen Specter (R-Pa.), who called the hearing to examine evidence that the spate of mergers among major firms in recent years was leading to price gouging and other collusive behavior. He said there was a strong correlation between soaring fuel costs and "a phenomenal rise in the concentration of oil and gas companies" and warned the executives that bipartisan support was building for an antitrust bill he has drafted. The bill would make it illegal to withhold fuel from the market in an attempt to lift prices, and it would also impose new limits on oil mergers.
This perenniel, onerous exercise in legislative vacuity is groundless, documented as recently as a 2004 study by the Federal Trade Commission that concluded, after an exhaustive review:
"Mergers of private oil companies have not significantly effected worldwide concentration in crude oil. This fact is important, because crude oil prices are the chief determinant of gasoline prices."
State-owned companies control the market now, period.
Posted by Alan at March 15, 2006 05:39 AM