Congress Does Energy, Lehman Bankruptcy and Price Gouging
The House of Representatives considers a new bill on offshore oil drilling.
The bankruptcy of Lehman Brothers shakes confidence in the U.S. economy.
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Texas Attorney General Greg Abbott reports complaints of price gouging in the wake of Hurricane Ike.
More headlines: listen to the LibertyWeek podcast.
1. ENERGY
The House of Representatives considers a new bill on offshore oil drilling.
CEI Expert Available to Comment: Senior Fellow Iain Murray on why the bill is a hoax:
“Anyone who believes this is a pro-drilling bill is fooling themselves. It allows a tiny amount of drilling while pushing forward all the fever dreams of the anti-energy environmentalist movement. This is not a compromise. It is a sell-out to the anti-energy zealots.”
2. BUSINESS
The bankruptcy of Lehman Brothers shakes confidence in the U.S. economy.
CEI Expert Available to Comment: Center for Entrepreneurship Director John Berlau on how government bailouts have made it harder for other troubled companies to survive:
“In fact, though most of Lehman’s failure must be left at its own door, the Bear and Fannie bailouts that Paulson engineered may have hurt Lehman’s prospects to find a buyer. His decision that creditors for these companies get 100 percent while shareholders get nothing turned out to be too clever by half. It made it nearly impossible, as CNBC’s Jim Cramer has said, for Lehman to issue new stock, because investors feared this stock too would be wiped out in another government-engineered creditor bailout deal at the expense of shareholders.”
3. CONSUMER
Texas Attorney General Greg Abbott reports complaints of price gouging in the wake of Hurricane Ike.
CEI Expert Available to Comment: Senior Fellow Iain Murray on the reality behind high gas prices:
“…is it [not] gouging to raise your prices sharply in expectation that the next delivery is going to cost a lot more or not arrive at all. Lots of gas stations don’t have supply contracts with suppliers, but have to pay cash to get the next delivery. So if the next tank truck is going to cost twice as much as the last one, the gas station owner has to put up his prices now in order to pay for the next delivery. If the next delivery is going to be delayed for a week or two or three, then the owner needs as a matter of the common good to raise his prices sharply immediately in order to signal to consumers that they need to cut back their consumption immediately..”
Listen to LibertyWeek, the CEI weekly podcast, here.