Oil, film, and folklore
The question of how the petroleum industry should be organized is addressed in this paper. Should there be a completely free market, a market tightly controlled by government, or a national oil company that produces and sells all our energy. The kind of market that we presently have and how that market is working are discussed. In discussing the past half century of the petroleum industry, the author likens it to the movie business, the recording business, and the like. No short description of the U.S. petroleum industry could do justice to the misguided imagination exercised by Federal bureaucrats and politicians. The themes of petroleum regulation over the past generation have been (1) to maximize the cost of producing energy by subsidizing wasteful enterprises, sources, and technologies and by discouraging efficient ones, and (2) to offer selected groups of consumers cheaper energy, while forcing other consumers to pay far more than is necessary. Doubtless there are government interventions that would improve upon the petroleum market. We must, for example, control environmental damage, deal with OPEC as a monopoly, and prepare for foreign supply interruptions. But we must also guard against government controls that are used to further special interests or naive ideologies. In the past these have had harmful effects on our standard of living. Three social forces have led to the anti-economic policies that have undermined the petroleum market: the political influence of various interest groups; the natural interest of politicians, bureaucrats, and Washington lawyers in expanding their influence through new government programs; and the application of simple-minded and abstract ideology to complex situations. The real profits of the oil industry are laid out and shown to be no greater than any other U.S. industry. The criticisms of the petroleum market and their justices and injustices are discussed. (MCW)
- Research Organization:
- Univ. of Michigan, Ann Arbor
- OSTI ID:
- 6219366
- Journal Information:
- Regulation; (United States), Vol. 2:4
- Country of Publication:
- United States
- Language:
- English
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02 PETROLEUM
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CONSUMER PROTECTION
INTERVENORS
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ENERGY SOURCES
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294002* - Energy Planning & Policy- Petroleum
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