While motorists were paying record prices to fill up with gas for Memorial Day weekend, Congress was making political hay by declaring war on “price gouging.”
By a vote of 284-141, the U.S. House passed a bill declaring it a federal crime for gas stations or oil companies to take “unfair advantage” or to charge “unconscionably excessive” prices for fuels.
Christened the Federal Price Gouging Prevention Act, the legislation is little more than an attempt to take political advantage of consumers grimacing at high summer-vacation gas prices. It does nothing to bring down those prices, and could actually send them soaring even higher.
Here's how Pennsylvania Rep. Tim Murphy described the whole shenanigan: “ Once again, Congress is trying to fool the public into thinking it's doing something about rising gas prices. Unfortunately, this Congress is not addressing the real problems causing the high gas prices, and consumers will continue to pay at the pump.
“This legislation targets only a small fraction of what makes up the price of gas. The retailers and gas station owners make more money off of cold drinks and chips than they do on gas. The real reason for high gas prices is the exorbitant cost of crude oil, which amounts to 56 percent of the cost.
“Our dependence on foreign countries, many of which are unstable or support terrorism, is what makes oil so expensive. For years, we have made ourselves more dependent on foreign oil and have not explored for U.S. oil.
“As Congress has blocked efforts to increase exploration, it has also failed to diversify and find better alternatives. ... We must also work better to conserve energy, which includes driving less, investing more in efficient transit systems and change our habits that waste so much energy.”
Indeed. Proponents of the gas-gouging measure failed to mention the report - also released last week - predicting a 57 percent increase in energy demand worldwide by 2030, as millions of consumers in Russia, India and China enter the market.
Meeting that demand, the Energy Information Administration said, will require increased oil production of 118 million barrels a day, or 40 percent.
Instead of turning its attention to energy conservation or alternative energy or even new domestic sources of oil and gas, though, the House chose last week to pick the low-hanging, ever-so-politically popular fruit.
As passed, H.R. 1252 would send the Federal Trade Commission and state attorneys general in pursuit of “price gougers,” again including your neighborhood gas station owner - who has no control over the price of gas. It would allow class-action lawsuits, too, virtually assuring a legal free-for-all - again, without doing anything about the price of gas or the nation's energy problem.
The FTC even testified against the bill, citing repeated studies of the domestic gasoline market, including in the months following Hurricane Katrina. Time and again, those investigations found negligible evidence of price gouging.
So what, then, is the Federal Price Gouging Prevention Act?
Politics.
As usual.
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