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We Need to Face the Facts on Oil

By Mark Davis

The Department of Energy confirms the sting all drivers feel: A gallon of gas has rocketed up about 30 percent since February.


But as we wrap our brains and wallets around that harsh fact, the passing parade of panic has obscured some useful truths about how we got to this point and how we might get out. Wondering why the economy has not buckled under the weight of these stratospheric new prices? It's because we are paying about the same for gas as we did 25 years ago, adjusted for inflation. For most of the '80s and '90s, the cost of everything gradually climbed. Gas essentially did not, until just a few years ago. That pendulum was bound to swing sometime; in that context, today's gas prices are not uniquely punitive.

European visitors would still find American gas a bargain. Not that I wish to emulate European markets - that fact simply serves as an introduction to the global forces that affect oil prices.

Iraq is a work in progress, with stability still a way off. Iran's president is a lunatic. Nigeria may be descending into a nightmare of dictators and coups reminiscent of that nation's last four decades of history.

Instability in oil-producing nations boosts world oil prices; stability brings them down. The best thing we can do to bring about that stability is to win the war. I'd hate to get in the way of scornful ex-generals tripping over each other in airports during their book tours, but if we could direct our energies toward supporting the war we're in, we might have a better chance of prevailing and seeing that stability unfold.

That will take years, but so will every other substantive thing that will bring prices down. If Congress had allowed the Alaskan drilling President Bush started asking for five years ago, oil from that sliver of land might be hitting the pipelines right now.

Imagine that. More American oil. We have whined for decades about relying too much on foreign oil, yet we have never seen a major public outcry for environmental extremists to get out of the way so that we can drill and refine more of our own oil and import less from countries that want to kill us.

No new refineries in America in more than three decades. That track record of obstruction, thanks mostly but not totally to Democrats, has done more to keep our oil prices high than any Republican coziness with big oil.

As if much coziness remains, now that the president is reading from Al Gore's index cards about our "addiction to oil." Is any hybrid auto plant safe from a Bush visit these days?

What the president and all principled public servants should do is butt out of the decisions America makes about what to drive.

The exploding hybrid market does not need government help to succeed. When gas started to edge up in the 1970s, America started to crave better mileage, and automakers offered it.

If enough consumers want far more efficient vehicles - or cars that run on something besides fossil fuels - someone will make them and people will snap them up. If this happens often enough, oil consumption will drop and so will the price.

We must dispense not only with needless subsidies, but also with harmful notions that cloud our logic. Threats of price controls and windfall profits taxes are an outrage. The prospect of government defining what anything should cost in the private market is repugnant to the concept of liberty.

We need to gut up and face facts: Oil companies don't set the world price for oil, but they have the right to charge whatever they like at their pumps. Are they adding a few pennies per gallon to finance obscene retirement packages for the occasional departing executive? Probably so, and when you own an oil company, you can, too.

Through our behavior in the marketplace, we will let it be known how much we will pay for gas and how much of it we wish to use. Let's stop these useless cries for Congress to "do something." Government doesn't need to do more; it needs to do less.

Elected officials need to drop the obstacles to domestic production, lose their fetish for forcing additives like MTBE and ethanol, and stop wasting our time grandstanding about investigating and punishing oil companies just to get underinformed heads to nod.

Mark Davis is a columnist for the Dallas Morning News. The Mark Davis Show is heard weekdays nationwide on the ABC Radio Network. His e-mail address is

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