Oil and gas price hike
Who should pay?
By John
Catalinotto
For the working class in the United States, the rapid
increase in the price of crude oil from historic lows two years
ago has meant a sudden drop in real income.
This takes the form of increases in the cost of gasoline,
which especially hits those many workers who commute to work by
automobile. Higher prices for heating oil will also soon hit
the pocketbooks as cold weather kicks in.
So far it is not a real "crisis," that is, there have been
no major shortages of either gasoline or heating oil.
To address the problems caused by this price hike, it is
first necessary to eliminate some myths about its causes.
First, this price hike, as with earlier oil "crises" that
brought even higher prices for crude oil in current dollars,
has brought the usual attacks on the Organization of Petroleum
Exporting Countries, or OPEC. These usually include warnings
about the grave dangers of a new world power center, and are
accompanied by vicious reactionary attacks on Arab and other
Middle Eastern peoples.
These tales are as exaggerated now as they were in the
mid-1970s, when OPEC was able to first limit the production of
crude oil. And what happened then? The biggest OPEC oil
producers like the Saudi Arabian and Kuwaiti monarchies could
do nothing with their extra dollars but either buy U.S. weapons
or invest them in U.S. and British banks.
Despite the prominence of the Saudis, all the money they
make goes into Western banks--which invest it wherever they
think they can make the most profit.
A more populist, nationalist government like the Iraqi
regime was able to provide health care, education and some
development. But all OPEC countries' economic development
remained subject to imperialist control of markets, banks and
military superiority.
The attempt to blame OPEC for the price surge is a diversion
from the real culprits--speculators on the world markets, the
big oil companies, and the instability and chaotic nature of
the world capitalist system itself.
Venezuelan President Hugo Chavez has become an OPEC
spokesperson as he hosts the OPEC meeting in Caracas. Chavez
argues that OPEC should serve as a bulwark against the economic
imperialism he sees as damaging to developing countries.
In response to calls from the United States and Europe for
OPEC to take steps to lower prices, Chavez told listeners to
his Sept. 24 radio call-in show: "How nice it would be if they
also lowered prices for the things they sell us--computers,
medicine, cars and the interest on foreign debt."
Chavez is only defending legitimate popular interests when
he tries to avoid the kind of collapse in prices that took
place following the capitalist depression in East Asia in
1997-1998, when crude oil prices dropped under $10 a barrel,
driving Venezuelans into poverty.
Who pays for the oil?
The impact of these lower prices on the capitalist system
was to encourage extravagant use of oil products--including
greater production and sales of gas-guzzling vehicles like
SUVs, expanded air travel and military exercises. It also
discouraged oil exploration, research and development of
alternate energy sources like wind and tides, and conservation
efforts like public transit or better home insulation, because
it was cheaper just to burn oil.
What is important is not that crude oil be dirt-cheap, but
that working people not be the ones to pay the costs of spikes
in prices.
For example in Belgium this September, where taxes on
gasoline are high compared to U.S. rates, the cost per gallon
went over $4 and sparked mass demonstrations. Individual
entrepreneurs like truck and taxi driver-owners were active in
these, but also workers.
The Workers Party of Belgium raised the demand of including
gas prices in a cost-of-living index, which would then be used
to calculate wages and result in a wage increase. This
transfers the cost to the bosses from the individual
workers.
It would be important to find a similar formula here so that
the struggle is clearly between workers and bosses. It should
not be diverted to a battle that pits workers here against the
needs of developing countries.
In the long run, a planned world economy would seek out
alternate energy sources--especially those more friendly to the
environment--while the use of oil is slowly phased out. In the
meantime revenues from oil would be used to diversify the
development of the oil producing countries.
This article is copyright under a Creative
Commons License.
Workers World, 55 W. 17 St., NY, NY 10011
Email: ww@workers.org
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