I attended a Business and Media Institute panel this morning on gas prices at the National Press Club. Our own Quin Hillyer moderated.
Cato Institute's Jerry Taylor had pointed and frank comments on just about every topic, but particularly price gouging. In short, either it exists everywhere or it doesn't exist at all. Consumers expect Congress to "do something" when gas prices jump, but say nothing about increases in the prices of T-shirts, cars, or beer at the bar. Why is gas different? It shouldn't be.
Usually the politicians and demagoguges (like Bill O'Reilly) hang their case on the large profits oil companies are seeing lately. A few strong points here: 1- Long term, the oil industry is not a smart buy for investors. Most years are tough, and these "windfall" years are important for the tough years. 2- The profit margins are slim compared to many industries. BP has a 6.8 percent profit margin, while Fox News makes 10.2 percent profit, and other media companies even higher.