The World According to Nick
My take on Software, Technology, Politics, and anything else I feel like talking about.
Tuesday, October 25, 2005

I Can't Stand Bill O'Reilly 

It's a good thing I don't watch his show very often, otherwise I'd have to start an entirely new blog just to refute all the junk that comes out of his mouth lately. I understand why he's so popular. He's an excellent salesman. He will boil down the most complicated concept until he can sell it to you with one simple point. Then anyone who dares try to bring up other factors... well they're just evil spin doctors. It's that seductive desire that people have for a simple message that makes his show so popular. People like having complicated world affairs broken down to simple parts for their digestion, which can be alright, if done responsibly. Too often however, the worm is digested by the mother bird so much, that you can't recognize it at all.

Bill's latest crusade has been on the evil American petroleum companies who "gouge consumers to make billions off the back of hard working people". Mr. O'Reilly has taken a rather complicated concept, the price of gasoline, and broken it down into an oversimplified form. No matter how hard you try, you can't convince Bill that the price of gas is actually determined by a number of factors. For Bill, its quite simple. The price of gasoline is set by worldwide demand shown through the price of a barrel of oil, and then the American oil companies add their own markup, and that's it. Bill is convinced that if they wanted to, the American oil companies could drop the price of gas to $2.00 per gallon or even less... just on the whim of a board room. It's the evil conspiracy between the major oil companies, and the terrorist harboring Saudis. Never mind that only 20% of our crude comes from Saudi Arabia. You know, that's just spin.

So Bill started a "campaign" in which he encouraged people to buy less gas, in order to "stick it to the greedy oil companies" and "scare them" into dropping their gas prices. Then, when people actually did start buying less gas, he claimed victory in his normal narcissistic, annoying, self-congratulatory manner, without even realizing how ignorant he actually was. Here is the transcript from last night's show:

Gas prices going down. For weeks, we've been telling you that the five major U.S. oil companies have been price gouging, taking advantage of the hurricanes and the greed of OPEC to slam the American consumer.

As you know, some Americans have sided with the oil companies, citing the free market, supply and demand, that kind of argument.

Well, what say you now? The worldwide demand for oil's the same today as it was eight weeks ago. But oil prices are declining, so what gives?

So... "worldwide" demand hasn't changed much. Of course, worldwide demand only really affect the price of crude oil. If only the price of crude oil were the only thing that affected the price at the pump. But don't try convincing Bill of that.

Fear. That's what gives. Millions of Americans are angry with big oil and are buying less fuel. SUV sales are a disaster. And if you watch the car commercials, many of them are now touting good gas mileage.
...
The truth is that the American oil companies set the domestic price of fuel based upon what they think they can get away with. By the way, the price drop again shows the power of the people. Individual consumers acting together can bring any industry to its knees.

Wait Bill... I don't understand. Consumers acting together, and buying less gas dropped the price? I thought you said demand didn't change?! Regional demand did change. In fact, regional demand has a much higher impact on gas price than worldwide demand. This country's ability to refine crude into gasoline is so strained, that even small spikes in demand, or small disruptions in refining capacity can drastically change the price of gasoline. We haven't built a refinery in this country since 1976, and we have to import 10% of our refined gasoline. Combine that with the fact that refineries aren't able to take advantage of mass production due to the insane number of boutique fuels required by environmental laws, and it gets even worse. Not that any of that matters to Bill.

Summing up, there is no change in energy demand worldwide from eight weeks ago. The oil companies have been scared into lowering prices. And the far left wants to exploit the situation to redistribute income. That's the cold, hard truth in the No Spin Zone.

Summing up, Bill is trying to take credit for a basic economic principle... Supply and Demand. The companies weren't scared into lowering prices. Regional demand went down, so the price went down as well. When demand goes up, gas becomes more scarce, so price goes up as well. This forces people to re-evaluate their needs, and only buy gas when they have to, therefore stopping shortages from occurring. People didn't but less gas because you told them too... people bought less gas because it was expensive!

What is truly sickening is watching the video that goes along with it. You can just see it in face, and here it in his voice... he's actually trying to take credit for dropping gasoline prices. Perhaps I'm asking too much of Mr. O'Reilly. Perhaps I'm asking too much that he might actually look at all the variables that go into the price of gasoline, instead of just the one that he can make a political point about. Perhaps its too much to expect Bill O'Reilly not to be a narcissistic talking head.

Comments:

The whole concept of "buying less gas to lower the price" is not only dumb but not practical. Who is going to smash their nose to spite their face?

So I don't go buy groc today because I can get by, I still have to go soon, because I have to eat, and it matters not whether I go today or in a couple days because I buy the same amount of groc for the year.

Who is really going to cancel a vacation drive long planned.

Basically car pooling only works for those that are aleady doing it.

So at best it will delay buying gas for a few days, not reduce the amount purchased. Sheesh!

  Posted at October 25, 2005 3:23 PM by Anonymous Sandi  
I'm not so sure of that. Bus ridership is up in Milwaukee in the last few months.

And there are people who actually would change their location for a vacation based on cost. So maybe they'll still go, but they won't go as far as they might have gone before.

And yet others would actually think about combining trips for errands into one to save on gas, where as before they wouldn't give multiple trips a second thought.

Hitting your pocket book makes people do strange things.

And if you think about it... buying the same amount of gas every 9 days instead of 7 (or whatever period of time) is buying less gas. You're making your 12 gallons (or whatever you buy) last 2 extra days.

Granted I'm not one of those people... but plenty of people do these things.

  Posted at October 25, 2005 3:31 PM by Blogger Nick  
I heard him spewing this unsound drivel on his radio show yesterday. I really can't decide whether the man is a charlatan, or he really is not as smart as his degree from Harvard would seem to indicate.

If you have not yet seen it, The Colbert Report on Comedy Central makes for an excellent parody of O'Reilly. Colbert nails O'Reilly's mannerisms perfectly as he plays a cable talk show host.

  Posted at October 25, 2005 5:48 PM by Blogger Bostonian Exile  
Nick you may be right. I'll admit I'm not one to make a good judgement on it with what little driving I do.

Last year I only put about 2350 miles on my vehicle, thats not even an oil change.

And last week I put radiator, waterpump, thermostat and temp sensor. That probably cost me enough ($640) to drive for years at $3-4 a gallon.

  Posted at October 25, 2005 9:30 PM by Anonymous Sandi  
I can't stand him either. O'Reilly takes credit for everything. The prices went down because of quantity demanded going down a bit while post-Katrina supply is ramping back up.

Some people are very sensitive to higher gas prices and will conserve as a matter of principal, even when it isn't practical. I'm sure most of them don't do anything because O'Reilly told them to, but no one can tell O'Reilly that. But what do we know, we're just "evil bloggers" anyway.

  Posted at October 26, 2005 2:11 AM by Blogger Sanna  
Well said. I enjoyed reading your post.

  Posted at October 26, 2005 6:15 PM by Blogger Marjorie  
My post on No Spin Bill:
Crude And O'Reilly
Today, the crude oil price dropped below $60 per barrell. I am no expert on oil but could the price fluctation, this time downward, have anything to do with market forces? Or is Bill O'Reilly right that the powerful oil company CEO's are just toying with our wallets? Sometimes they take more of our money and sometimes, just for shits and giggles, they decide to lose money and lower the price. It is hard to figure out why price gouging is not a constant thing.

For more on Bill's lack of knowledge about the oil and gas world and economics in general, read Alan Reynolds' "The Foolish Factor".

  Posted at October 31, 2005 7:34 AM by Blogger neal phenes  
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Name: Nick
Home: Wauwatosa, WI, United States

I'm a Software Consultant in the Milwaukee area. Among various geeky pursuits, I'm also an amateur triathlete, and enjoy rock climbing. I also like to think I'm a political pundit.


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