Does The President Not Understand Economics Or Does He Hope The People Don’t?

The President has spoken:

And even if you have a job, chances are you’re having a tougher time paying the rising costs of everything from groceries to gas. In some places, gas is now more than $4 a gallon, meaning that you could be paying upwards of $50 or $60 to fill up your tank.

Of course, while rising gas prices mean real pain for our families at the pump, they also mean bigger profits for oil companies. This week, the largest oil companies announced that they’d made more than $25 billion in the first few months of 2011 – up about 30 percent from last year.

Now, I don’t have a problem with any company or industry being rewarded for their success. The incentive of healthy profits is what fuels entrepreneurialism and helps drives our economy forward. But I do have a problem with the unwarranted taxpayer subsidies we’ve been handing out to oil and gas companies – to the tune of $4 billion a year. When oil companies are making huge profits and you’re struggling at the pump, and we’re scouring the federal budget for spending we can afford to do without, these tax giveaways aren’t right. They aren’t smart. And we need to end them.

The President would seem to argue that raising the cost of doing business for the oil companies will lead to a lowering of gas prices. He cannot believe that, can he?

Those subsidies are not payouts from the government. Apparently, they’re money the government doesn’t take from the oil companies:

Amid rising gasoline prices at the pump, President Barack Obama urged congressional leaders Tuesday to take steps to repeal oil industry tax breaks, reiterating a call he made in his 2012 budget proposal earlier this year. The White House conceded his plan would do nothing in the short term to lower gas prices. [Emphasis added.]

Apparently, he or someone at the White House does not believe this will lower gas prices. He must then think that some people will react to the attack on the cartoon character Big Bad Oil.

Sadly, I know some people who do hear that bell and drool appropriately.

Here’s a hint: If the cost of doing business goes up, price goes up. And money the government does not take from you is not a subsidy. If you firmly believe that, one could make a case the government could trim the deficit by ending your graphic novel subsidy, that is, the money it does not take from you that you spend on graphic novels.

Sadly, one has difficulty arguing with people who feel Big Oil is the bad guy and the President is the good guy.

Finally, I’d like to acknowledge that this president is, in fact, effective at achieving his goals.