Make Oil a Public Utility

[FourScore]

The furious moans and groans about gasoline and heating oil prices have been met with a public-be-damned attitude from the oil industry — and nothing is being done to rectify the problem. Prices continue to sky-rocket.

Why not designate oil companies as public utilities?

A public utility has been defined as “a business that provides an everyday necessity to the public at large” — such as water, electricity, natural gas, telephone service, transportation, cable TV and other essentials.

Because of the need for and dependence on these commodities and products, the business of supplying them is readily subject to abuse. Without regulation, price gouging can become rampant in a time of great demand and economic turmoil, such as this.

A public utility regulated by the state or federal government, or the two working together, is entitled to charge reasonable rates for its products and services. It also is entitled to earn a reasonable profit. But that’s far less than what Big Oil is making. Public utilities are corporations that distribute dividends to their shareholders amounting to perhaps 5 percent a year of the stock’s value.

Oil energy fits squarely into the criteria for a public utility. How can it be distinguished from electricity and natural gas? It can’t be. But right now, it’s a political “untouchable.”

The oil industry recently posted record earnings for 2007, as it had for the previous two years. Exxon Mobil, known as the industry gold standard, had a net income of $40.6 billion, attributed to surging oil prices. For every blink of a second in 2007, that amounted to $1,287.

Exxon Mobil’s sales exceeded $404 billion, which was more than the gross domestic revenue of 120 countries. Chevron and other big oil companies also announced the largest profits in history.

“Congratulations to Exxon Mobil and Chevron — for reminding Americans why they cringe every time they pull into a gas station,” said New York Sen. Charles Schumer.

Some members of Congress have supported an excess profits tax. Others have said the tax breaks accorded two years ago to encourage domestic production should be rescinded. Advocacy groups say the profit margins are unjustifiable...

http://www.commondreams.org/archive/2008/03/24/7863/

[cliffordu]

1. YES YES YES YES!!!!!

[mikelgb]

2. that will get them in the streets

[dkf]

3. Trying to keep our country addicted to oil is horrendously short sighted.

Lets move everyone to solar, wind and other renewables please. We are running out of oil anyway and we need to be prepared for that day.

Thank you.

[sharesunited]

4. Here's a less radical step.

Use the Strategic Petroleum Reserve as an 800lb gorilla in the oil futures marketplace. Sell delivery contracts against the reserve aggressively into rallies and buy those contracts back on declines. You can beat the devil out of the speculators and possibly never have to actually deliver out a single drop.

[RB TexLa]

6. except it would amount to maybe a 200 pound gorilla, which isn't as scary

[JCMach1]

5. Let's nationalize oil production!

That's worked pretty well for Russia and Venezuela... oh yeah, and MOST OPEC countries.

[BigDaddy44]

7. Does that mean gas station attendants will be Gov't employees?

So I won't get to pick from BP, Shell, Exxon, etc. when I go to the gas pumps? They'll all be the same? Will they still sell burritos too?