Au contrare, mon frere! There is a clear reason.

As we all know from our undergraduate economics courses, commodity prices are far from stable: if there is a shortage of one barrel of oil, the price shoots up; if we have an overcapacity of one barrel, its price collapses. Commodities are priced on the margin. And with modern commodity exchanges, where all participants (both buyers and sellers) possess essentially the same information, buyers and sellers instantly bid the price up or down depending on whether supply exceeds demand, or vice versa.

There are many clear and straightforward reasons why prices have increased dramatically over the past couple of years. Here are just two out of many:

1. First and foremost, the global demand for oil is growing rapidly, while supply is growing much more slowly. Most of the growth in demand is coming from India and China, two rapidly industrializing countries with rapidly growing middle classes. Hundreds of millions of people driving cars who, ten years ago, were riding bicycles.

2. In America, essentially no new refinery capacity has been added during the past 20 years. We can produce/import all the crude oil we want, but to burn it in our cars and trucks requires it to be refined into gasoline. I won't go into the reasons that no new refineries have been built -- would be a good topic for another thread in the future.

High oil company profits are a result, not a cause, of high crude oil prices. It has certainly been a huge windfall for the oil companies, and one can argue that a portion of the windfall should be recaptured by the "public" (i.e., the government) and used for alternative energy R&D or other activities in furtherance of the "public interest". However, you can't accuse them of a "conspiracy" or other manipulative, anti-competitive behavior. The simple truth, like it or not, is that these companies happen to extract, refine, distribute and sell a commodity product that, through no brilliance or manipulation of their own, has skyrocketed in price over the last few years.

Love 'em or hate 'em, either way, these guys are a major beneficiary of the problem, but are not the cause of the problem. In fact, when this "problem" (i.e., demand exceeding supply) was with us in the 1970s and then reversed itself in the 1980s, the oil companies were anything but "beneficiaries" -- they darn near went broke. A major recession in China, which will probably spread into a worldwide recession, will bring us back to $40 oil pretty quickly. Not that I'm advocating that.

I would propose that we raise the national gas tax by $1.00 or more per gallon, phased in over the next 2 years. The revenue generated by this tax would be used to lower the employee-paid portion of Social Security (FICA) tax, thereby returning the money into workers' pocketbooks. The higher price of gas would reduce demand and would incent people to use mass transit and to purchase fuel-efficient vehicles. This would create a larger market for fuel-efficient vehicles and auto manufacturers would develop and produce more of these vehicles to meet demand. Reduced use of petroleum in this country would provide environmental as well as national security benefits.