Hillary, Leader of the Know-Nothing Wing of Her Party

It's distressing to see Hillary Clinton, as part of her maniacal quest to seize the nomination at any cost, descend to the level of anti-intellectualism. She's a very bright woman, yet when confronted with the true consensus that practically no reputable economist in America thinks her gas-tax holiday scheme makes any sense, she retreated into a dumb vs. smart routine, deciding to cast her lot with dumb people. All the economists in the country, including Paul Krugman (who obviously was trying to develop a crush on her), were suddenly "elitists" who just didn't care about the plight of the ordinary American the way she does. Anyway, her plan was not like that stupid, identical idea of John McCain. She was going to tax the oil companies to make up for the lost tax revenue because of their "windfall" profits.

Ah yes, the windfall profits. The windfall, of course, refers to the astonishing profits companies like ExxonMobil and Chevron have posted over the last few years. While my own populist sympathies would like to buy into this idea, I'm not sure it's correct to do so. Now I'm sure there have been price gouging, manipulated supply and other ploys from the monopolistic bag of tricks which have marginally boosted Big Oil's profits; yet the larger picture suggests that American oil companies, the remaining cohort of the once majestic Seven Sisters, are kind of hanging on for dear life and making hay while the sun shines and the oil flows. American oil companies now control about 7% of the world's known reserves. Far, far larger and more powerful than ExxonMobil & Co. are the state-owned oil companies like Gazprom in Russia, Saudi Arabia's Aramco and Mexico's Pemex. The day of the great American "concessions" in the Middle East and elsewhere are over, that halcyon period when Standard Oil and British Petroleum carved up the stupendous fields in Iran, Iraq and the Gulf States and paid the owners of the sand dunes a stipend to take away the petroleum underneath.

The big American oil companies are just buyers on the market, and they're paying a ton for the raw product. If they hold their profits at a steady 8-9%, of course the numbers swell simply because of the high price of gasoline, which in turn is attributable to the $120+ price they are now paying for light sweet crude. If you sell a billion dollars worth of gasoline at 8% profit, you make $80 million. If you sell the same quantity of gasoline at a higher price and gross $2 billion, your profit goes to $160 million. But the underlying price is set by a different group of gouging monopolists, OPEC and other national oil companies, who are concerned that peak oil has arrived and that from here on out, they are going to be selling dwindling amounts of their "patrimony," as GWB calls it, probably without knowing what the word actually means. So is Hillary suggesting that Exxon lower its profit margin because it doesn't need all that money? What is she, a Communist who happened to make $109 million over the last 7 years? Whye doesn't Bill cut his hourly rate on his speeches to the Colombia free trade people?

Trying to get our mitts on Iraq's patrimony, in fact, is why Bush won't commit, now or ever, to leaving Iraq, and probably explains the otherwise unexplained reluctance of the Democratically-controlled Congress to stop funding the war (indeed, they're about to shovel out another $200 billion or so to keep it going well into the next presidency). What is always going behind the scenes in Iraq, behind the exploding buildings and the heads rolling in the gutters of Sadr City, behind the rockets landing in the Green Zone and the firefights between militias, is that simple, immutable fact of commerce: America's oil companies are trying to work out the terms of extracting all that precious Iraqi oil from those virgin fields. It's our one oily ace in the hole. What a bonanza! And all those oppressed Democratic voters in Indiana, worrying how to fill up that 8,000 lb. Yukon Denali to get the kids to the soccer game in Terre Haute at an affordable price: help could be on the way! If we don't cut and run from Iraq, that is, before we check the last box on Freedom's Agenda, that freedom being ours to fill the 20-gal. tank in the Escalade for less than a C note.

After all we've been through in Iraq, we kind of owe it to ourselves. You think that little orangutan in Venezuela, Hugo Chavez, is going to cut us any slack on selling his stuff to us? Iran won't even deal with us; their new best friends are China and Russia. Mexico's Cantarell field is sputtering out. We've got to have Iraqi oil, the second known largest reserves in the world, and mostly untouched. Our whole lifestyle depends on it! And we've earned it, dammit, we've blown a whole country apart, turned Iraq over to Iranian sympathizers, destroyed our reputation in the eyes of the world, killed hundreds of thousands of Iraqis and a lot of Americans too, but like a crazed junkie with an empty needle and pupils swelling wide, we see that oil and we know we've just got to have it.

That's all I'm saying, Hillary. Step back and let Exxon and Chevron feed the monkey. Don't start messing with the pusher-man, and keep the street price up where it belongs.