Judging by all the outraged Vent callers and letter writers screaming about skyrocketing gasoline prices, Arizona Attorney General Terry Goddard will have plenty of public support for his “Price Gouging Protection” legislation.
And even Arizona’s conservative legislators might be tempted, given all the public pressure, to enact legislation to short-circuit the marketplace.
It would be a disaster.
No one likes paying over $3 a gallon for gasoline. And it’s impossible to avoid the bitter reality (at least for those not owning oil-company stocks) that the big petroleum producers are reaping handsome profits.
Some members of Congress want to haul oil company executives in and ask them some tough questions, and we see nothing wrong with that. And if Goddard wants to launch an investigation of suspected price fixing, that's fine too.
But we strongly suspect the probes will also yield timely lessons in supply and demand. When domestic and global demand for oil continues to increase as U.S. environmental restrictions severely limit any new expansion of our petroleum production and refining, and then a hurricane disrupts a major energy hub, prices will rise. It’s inevitable. If Goddard had paid attention in economics class, he would understand that that’s how the market works.
If Goddard gets his way and is able to use the power of government to force the price of gasoline below the market rate, Arizona instantly will suffer shortages.
We have a better suggestion for Goddard. He should tell his Democratic colleagues in no uncertain terms that their ferocious opposition to any expansion of U.S. exploration, drilling and refining operations over the past 30 years needs to end. Yes, we all want to protect the environment, but Democrats and their radical environmentalist friends have all but shut off America’s essential expansion of its energy supplies.
Their opposition to exploration and drilling in the remote Arctic National Wildlife Refuge is a perfect example. This is an area that contains a huge petroleum reserve, and modern drilling technology would minimize the environmental impact. Yet you might think, based on hysterical Sierra Club news releases, that wildlife would be devastated by what amounts to sticking a straw into a vast petroleum lake. That's not only wrong, it's nutty.
Terry Goddard represents the political interests that have nudged us toward $3-plus gasoline prices. They have zealously and effectively blocked expansion of supply in the face of burgeoning demand. Cowtowing to his demand that state government artificially cut prices is a recipe for shortages that would cripple Arizona’s healthy economy.
The Legislature should know better than to bite. So should the public.