Regardless of politics the following statement is true: increased demand and reduced supply for oil should mean lower profits for petrol producers.
Jon Stewart got it right when debating the issue with Wall Street Journal correspondent Kimberley Strassel who needs Economics 101 training and focused on how high profits were good for shareholders. [A similar ‘debate’ played out at NBC’s Meet the Press].
Basically, oil is the chief input into producing petrol. Everything points to it being high because there are problems getting supply from Nigeria, Iraq and Iran. Everything points to it being high because China and India are booming. What that means is that the costs of producing petrol have done up.
Regardless of whether petrol production is a monopoly or perfectly competitive or somewhere in between, this should mean lower profits. If it is not, something else is going on and it is not competition.
There is lots of talk on the upcoming likely attack by the US on Iran. My favourite assessment thusfar comes from Stephen Colbert of The Colbert Report:
Many say, those who ignore history are doomed to repeat it. I say, those who ignore history are in for a Big Surprise! And doesn’t everybody love a surprise?
In an interesting article in Slate, Tim Harford speculates as to why lobbyists pay so little for their so-called control of government. He wonders what people would pay for government if it were truely up for sale in a monarchy.
This all reminded me of an idea I had years ago when Australia was considering becoming a Republic. By Republic, the idea on the table as that we would replace our current non-elected Head of State — The Queen of England — with a local non-elected Head of State — who knows who that would be except that they would be an Australian citizen.
I wondered that we might be thinking about this the wrong way. After all, the Head of State in either case would have no real power but a little bit of residual control (that is, if something was not constitutionally specified then they would intervene) and lots of prestige. In this case, why should we care if the Head of State is Australian or not.
Instead, we should recognise that whoever got the position would have lots of private benefits associated with it. So the problem was that we were giving it away rather than selling it. It would be better to think about auctioning the position off to the highest bidder — regardless of which country they are a citizen of. Moreover, if they were foreign, we would have the additional benefit from a sale in providing export dollars (the current account deficit was still a big issue back then).
Seemed like a clear win-win. I wonder why nobody invited me to the Constitutional Congress?
Peter Costello announced his support of a new citizenship test for Australia based on respect for “Australian values.” He did this in the context of criticising multiculturalism and so fueled fears of a lack of tolerance.
When it comes down to it, it is really unclear what testing “Australian values” could possibly mean. For instance, the Prime Minister claimed: “We welcome people from the four corners of the earth. The only thing we ask of them is that when they come here they become Australians before anything else.” Taken at its face value this appears to hit Catholics who aligned with the Vatican (an Independent state) or Jewish people who happen to be Zionists. And let us not forget our own Constitution establishing as Head of State a non-Australian! In this respect, to talk of something called “Australian values” in this context makes absolutely no sense.
Perhaps the government means to go down the British route. Last year, the UK government introduced a new test based on a book “Life in the UK.” It is hard to know precisely what questions are asked on this test but the BBC extrapolated based on the book (click here to try that out). I particularly love this question:
Life in the UK explains what to do if you spill someone’s pint in the pub (we’re not making this up). What, according to the book, usually happens next?
A: You would offer to buy the person another pint
B: You would offer to dry their wet shirt with your own
C: You may need to prepare for a fight in the car park
The answer is A. Isn’t that nice?
Of course, maybe when the Treasure is talking about values, he means values in Australia: such as what bread costs here? That is, after all, his area of governorship. Indeed, he could take a lesson from another potential UK question:
And finally, what does Life in the UK tell you it is “very important” to do when
engaging a solicitor?
A: Ask if they have a potential conflict of interest
B: Ensure they are qualified in the area of law of concern
C: Find out how much they charge
The UK answer is C! So maybe Costello’s values in Australia reflects British roots afterall.
There is a part of me (actually a large part) that believes that in modern democracy the real differences between alternative governments is not politics or policies as much as how much entertainment value they might provide during their term in office.
When it comes down to it, Australian politicians do not offer what U.S. ones do in this regard. This week’s events with the Vice President are a big case in point (see this link for one example). In an earlier era, we had such value from Dan Quayle; so much so that a part of me was sad when Bill Clinton was elected (especially as he droned through 45 minutes of acceptance speech). But boy did he turn out well on the entertainment front.
It seems to me that Australian politicians really need to get out more. What the above US examples have in common is that they happened on vacation or out of the office (or at least out of meetings) time. Australian politicians appear to be overworked and not spending enough leisure time or time in front of primary school classrooms. If they did this, we may be able to get a better quality of government (for our amusement that is) with probably little sacrifice in the quality of other things politicians provide.