If We're at War, Bush Should Limit Oil Profits

President Bush frequently compares the war in Iraq to World War II. While giving the commencement speech at the U.S. Air Force Academy Mr. Bush noted, "Like the Second World War, our present conflict began with a ruthless surprise attack on the United States." While speaking at a ceremony commemorating the 60th anniversary of World War II, Mr. Bush again made comparisons between the two conflicts. He said, "As we mark this anniversary, we are again a nation at war. Once again, war came to our shores with a surprise attack that killed thousands in cold blood."

While many Americans are dubious about these comparisons, perhaps we should take the president at his word. Maybe we are engaged in a global war. If that's the case, then there is ample precedent for Mr. Bush to limit oil profits. Americans expect the president to do something that will lower the cost of gasoline.

The average national price for a gallon of gasoline last week was $2.68. This is an increase of 40 percent compared to one year ago. And the Energy Information Administration predicts that gasoline prices will rise by another 25 cents per gallon by the end of the summer.

Oil companies are making huge profits. Exxon Mobil enjoyed the largest profit of any corporation in American history last year. Likewise, ConocoPhillips enjoyed a huge increase in profits in 2005. Much of the record profits are attributable to the fact that these companies bought oil reserves years ago when the prices were $10 to $25 per barrel. Oil prices are now going for upwards of $70 per barrel.

The price of gasoline, and many other items, also soared in World War II. Corporate profits more than doubled between 1939 and 1943. As a result, the federal government sought to lower prices and limit corporate profits during the war. According to Martin Hart-Landsberg, an economist at Lewis and Clark College, "Holding down prices was one of the U.S. government's important economic achievements du ring World War II." This was accomplished largely by the Office of Price Administration.

In 1941, President Roosevelt created the Office of Price Administration (OPA). Congress gave credence to this new governmental agency by passing the Emergency Price Control Act in 1942. The director of the OPA was given the authority to determine the price of a product that he determined to be "generally fair and equitable." He also had the authority to sue corporations and retailers for damages if they violated the price limits. During the last year of World War II over 71,000 retailers were forced to pay $5.1 million for violating price limits.

Recent polls have shown that rising gasoline prices are one of the most pressing issues that the public wants President Bush to address. Similarly, in 1941 and 1942 polls showed that the public wanted the government to limit corporate profits and the prices of many commodities. Consequently, the OPA simply froze most prices in March 1942. When corporations and retailers attempted to skirt the OPA, President Roosevelt issued an executive order in October 1942 creating an Economic Stabilization Director for the nation.

The director was given the authority to set national prices for most items. And President Roosevelt made him responsible for preventing increases that were unnecessary and unfair. The executive order mandated that the Economic Stabilization Director's office "...in fixing, reducing, or increasing prices, shall determine price ceilings in such a manner that profits are prevented which in his judgment are unreasonable or exorbitant."

Today, oil companies would almost certainly complain that these governmental limitations on profits and prices violate their rights. Businessmen made the same objections in World War II. However, the Supreme Court disagreed. In the case of Yakus v. United States, the Court found in 1944 that the price limits were constitutional. The court ruled, "There is no principle of law or provision of the Constitution which precludes Congress from making criminal the violation of an administration regulation."

When the war ended, the OPA and the Economic Stabilization Director were abolished. Not surprisingly, corporate profits soared. In the year following the end of World War II, consumer prices rose 67.4%. Clearly, one of the significant economic achievements by the Roosevelt administration in World War II was holding down prices, mainly by governmental controls.

President Bush insists that we are engaged in a global battle similar to the Second World War. If that's the case, he should insist on limiting soaring oil prices. He has both historical and legal precedents to support this. However, it's hard to imagine that he will. Given his close ties to the business community, and especially the oil industry, it seems likely that he won't do much to stop rising gasoline prices.

There is no war. We are illegally occupying Iraq after an illegal invasion of Iraq that was conducted without the constitutionally required declaration of war. We are not at war.

The 'War On Terror', like the 'War On Drugs', is a propaganda campaign that uses the mass media to induce fear into the population so that the people can be manipulated and made subservient and accept the ever-increasing totalitarian behavior of the state. Nothing more is going on here, and nothing less.

There simply is no such thing as a 'war' against an abstract concept.

Although I can't say I agree with your statement about being at war per se I most assuredly do agree that a truly responsible president should limit oil profits during a time of conflict. Sadly... Bush is not "responsible" in that way, he cares only about helping oil companies make obscene amounts of money since that is where he and his oil "buddies" interests are.

edited to add: another thing Bush should do is find a way to help Americans lower their consumption, for instance lower the national speed limit back to 55mph, and find and GET alternative fuels for transportation and home heating.

(The above comment is after a quick skim over... I'll read it more thoroughly when I have more time later. B-))

But don't hold your breath waiting on the Pigs to Fly By! :(

a positively alien thought (and another one with historical precedent) to our counterparts on the right.

Welcome aboard, Gene.

Bush is at war with the common people of the world. Anybody who would suggest that real people matter more than artificial persons must be a terrorist or an enemy combatant. Now report to the re-education camp constructed by Halliburton.

Excellent piece, BTW. You should submit this for publication on the home page.

OR his Cabinet. If we're at war, they should be devoting their full-time efforts to it and not lounging on a golf course or rocking in a rocking chair.

None of this open-ended resolution crap...if this regime says we're at war and it's Repugnican toadies so fervently agree, then let's get a full-blown declaration...have Congress go on record and vote on this adventure. Let's get every GOOP Congresscritter on the record as to where they stand on this issue and then show their constituents during the election campaign.

But the reverse has been the case, since forever.

while its a shame that the oil companies are making so much unearned money, the high oil prices will limit the use of oil, force alternatives to be created, and bring attention to the fact that we have a serious problem that needs addressing. i think we should add a $5 gasoline tax as well!

i just thought of a new bumper sticker: "PUV" for "Peak Utility Vehicle" (hastening the beginning of the end of modern life.)

to support drilling in environmentally sensitive areas.

drilling the last remaining drops in the more remote areas is a product of the perception that the petro-lifestyle is sustainable. if the govt went with the truth <gasp>, took an official stand that this lifestyle is finished, that alternatives are a necessity, it could actually crate greater protections for those remaining reserves. (it is only a matter of time until they are drilled under current thinking, price is no object when you NEEEEEEED it)

This could help the health insurance 'system' we're now operating under, with millions UNinsured since they can't afford to pay. Regulating monopolies and trusts is government's role in our so-called Free Market system. Laizzez faire economics results in anarchy and robber barons ruling the markets AND the economy. Time to get some leadership going in Washington DC.

would cure that.
Energy, health care and defense are the focus of the Carlyle Group.
Follow the money.

Amazing how the price of oil went through the roof as we needed oil for heat last winter and now it has increased as we need oil to travel.

I know it is peak times but it's amazing how the bad news always comes out to further stick it to us. It's hard for me NOT to believe how Iraq and Iran are just propaganda tools for the oil players to make their profits. Is it just transparent to me or does everyone else see this?

Dap

...and to think all these years, I thought it began with Hitler's invasion of Poland.

Poland was actually a bit late. The Japanese were already deep into their half of the war when Hitler moved on Poland. Although from our eurocentric view WWII officially starts with Poland.

the government needs to nationalize the oil industry in order to abide by the Constitution's preamble by providing for the common defense, promoting the general welfare, and securing the blessings of liberty.
That "God damned piece of paper" is the document on which this nation was founded, and it's high time the lying scumbags and war profiteers learned that lesson.
Our President is a nut.

This is a hot-cold war rather than a cold-hot war. THe cold hot followed ww2, the hot-cold is what is going on now where Conflict is hot and heavy but the reality of those watching it can only ask, "What the hell are we there for in the first place?"

ever think about restricting corporate profits, 'specially those of big energy.

And for both those targets, he will rot in jail and burn in hell after.

<<<shaking like a junkie at the thought of copying and publishing in local editorials>>>

...there, whew! the temptation has passed. <<wipes sweat away>>


:hi: Welcome to DU, Gene! :hi:

This thread promotes the idea that we have a right to cheaper gas. In fact, with crude oil a finite resource and only producing 40% of our domestic needs, we should be looking otherwise than promoting the SUV life style. As much as I hate to admit it, we have become addicted to cheap oil. Oil will not remain cheap. Peak oil has already occurred in a number of fields and will continue to do so in all others. It's supply is controlled by a number of countries not friendly to the United States. The flow to the US can be reduced at a moments notice with very little we can do about it. The high cost of oil now is in part driven by fears the oil future trader's have about supply disruptions. I haven't heard anyone yelling about controlling their profits. We must concentrate our efforts to reduce our demand.

In the 61 years since WWII our suburbs have grown tremendously and we are now seeing horrendous growth in the extended suburbs. We have turned our backs on mass transit by demanding the right to go where we want, when we want and how we want. Our centers of employment are spread out all over the place. This simply cannot be allowed to continue as a future practice. Our passenger railroad system is close to falling apart. Most mass transit systems are geared to moving people from the suburbs to the inner city. There are very few provisions available to move people around the suburbs. People's use of their personal cars makes local bus systems uneconomical for governments to run. Whether you want to admit it or not, most people look down on bus riders.

Use of petroleum and coal based energy is one of the main producers of greenhouse gases. A few environmental scientists are now saying we have 10 years to reduce our impute of these into the atmosphere or the resulting global warming will be disastrous and irreversible. However, this should be the subject of a whole different thread and would be a digression of the subject at hand.

The profits of the oil/energy industries are an easy target. Attacking them is a smoke screen used by those who want cheap gas to continue. In my opinion, the federal government should tax the fuel at a high rate thereby forcing a reduction in demand. These taxes would only be acceptable to me if they were dedicated to reducing the federal deficit. I would suggest something in the neighborhood of $3.00 a gallon. The resulting reduction in demand for gas would give a number of benefits to the environment and import/export deficit. Once the automotive companies realizes which way the wind was blowing they could again become profitable by selling masses of fuel efficient cars. Of course this assumes that General Motors might wake up. The downturn in this concept is that the short turn inflationary spike in commodities.

Would this be a hardship on the population of the United States? Sure, especially on those like me on a fixed income. Poor people would have a hard time with the increased cost of goods. This may result in a reversal of the growth of the suburbs and extended suburbs. I would hope this would cause a change in our use of mass transit.

By the way, I don't own any oil company stocks, darn it.

Please post this other places, like Huffington Post.

Thanks!

Just more of Bush's Churchillian wannabe fantasy.