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Extracts from Juan Cole's page for August 4 2004

"It should come as no surprise that Cheney plays fast and loose with the facts, blaming the Democratic Party for things that are if anything Cheney's own fault. While he was CEO of Halliburton, it at one point inflated its profit statement by 46%, and has just gotten a slap on the wrist by the SEC."

Cheney Blames Democrats for High Oil Prices (!)

US Vice President Dick Cheney lambasted the Democrats on Tuesday for causing high petroleum prices.

I don't often find Dick Cheney amusing, but I fell off my sofa belly-laughing over this one.

Cheney, being an oil man, knows exactly why petroleum prices are high.

1) The Iraq War and the US mishandling of the aftermath have had a significant upward impact on petroleum prices.

2) The consolidation of the energy market in a few corporate hands has pushed up prices, and threatens to become worse. We already know that Enron, led by Bush's dear friend and patron, Ken Lay, ripped off California consumers deliberately.

3) Instead of taking steps to increase US energy efficiency in the wake of 9/11, the Bush administration has encouraged consumption.

4) There are other causes for the high prices right now, including decisions of the OPEC cartel (Cheney's friends), a strike in Nigeria, and the Russian government's dispute with Yukos Petroleum over $3 billion in unpaid back taxes. These crises are temporary and will pass, and the price will fall again. To my knowledge, the US Democratic Party is not involved in any of these crises. There is also a shortage of refineries, which has to do with decisions of the big energy corporations in the US; Cheney's friends, again. Reuters blames Chinese demand to some extent, but Chinese demand was also high in the late 1990s when the price of petroleum was in free fall.

It should also be said that primary commodity markets tend to have boom and bust cycles. When the price is high, marginal producers come on line, raising supply, which eventually then pushes the price down, so that they cannot continue to produce profitably. When enough producers are forced out, the supply shrinks, causing prices to rise again, to the point where the producers with higher costs can again profitably come on line. And so on and so forth.

It should come as no surprise that Cheney plays fast and loose with the facts, blaming the Democratic Party for things that are if anything Cheney's own fault. While he was CEO of Halliburton, it at one point inflated its profit statement by 46%, and has just gotten a slap on the wrist by the SEC.