I Realize You Already Know This, But…

Bill O'Reilly is nuts.

Comments

[independent worm]

Yeah, that's an odd one. One person setting the price of gasoline? I always thought Bill more of an intelletcually dishonest shill (or "hack" if you will), rather than an outright dope. Oh well, shows you what I know.

Though I do agree with the general viewpoint that there is only collusion, and no actual competition, in the gasoline market.

Anyway, I enjoyed this bit of it:

Eight governors have now asked President Bush to investigate alleged price gouging.

In other news, a local fox has been asked to investigate the disappearance of several prize chickens from a nearby henhouse.

[rdkraus]

Mark Levin did a great bit on his radio show where he interviewed "the guy" who sets gas prices in the US. It was surrealistic to say the least.

[Henry]

What are "American" oil companies?

What a quaint anachronism....

[Timothy]

They never should've let O'Reilly leave "Inside Edition", show really went downhill after that.

[JMoore]

Anyone ever notice the similarity in O'Reilly's thinking, as expressed in this link, and the thinking which underpins faith in God? There just has to be someone responsible for this; somebody has to be in control!

I wonder if belief in a Prime Mover is a natural human instinct.

[Ruthless]

Would it help Bill's ratings to accuse the Devil of setting the price of gasoline?
What's good for ratings is bad for economics and vice versa.

[Jennifer]

Mark Levin did a great bit on his radio show where he interviewed "the guy" who sets gas prices in the US.

Was he Jewish? I need to know which conspiracy is behind this.

[Evan Williams]

we still can't find out who exactly sets the price of a gallon of gasoline. Which human being in America does that? [...] Every time I ask who sets the price I get "the market", "the Merc", "OPEC", and on and on. Well it's all B.S. Somebody tells your local gas station owner exactly what to charge. Somebody does that.

Nuts? Ahem, I'd say utterly batshit insane is more like it. So, Bill's "looking out for us", by asserting that there is a Petroleum Wizard of Oz behind the curtain, pulling the pricing levers? I knew he was just plain stupid, but this is more along the lines of "institutionalized".

Again, Talking Points is not a conspiracy operation.

Jeeezus, well, ya fooled me. Hell, his conspiracy theory actually looks better than the alternative: gross economic ignorance.

The coming winter will punish millions of Americans who have to heat their homes using gas or oil. No question we're going to get hurt. Government owes us some oversight, but we owe it to ourselves to use less oil.

Yeah, Bill...people are just gonna turn off their thermostats this winter, because Loony Bill O'Reilly tells them to. Higher prices aren't enough, but O'Really?'s wacky conspiracy theories about some secret dude who sets US gas prices, that will do the trick!

[Evan Williams]

Ruthless,

I'd say that the best way to help his Fox "News" ratings would be to blame it on Clin-Ton or "Elitist Liberals".

[Occassional O'Reilly Listener]

He may be a nonsensical asshole, but at least he doesn't do drugs and he doesn't drink. He's very proud of that, and takes every opportunity to remind you. And, by the way, did you know there are Mexicans coming into the country -- illegally?

[JMoore]

Jennifer

Please keep quiet! We all know who's behind it, and I think we all know what needs to be done, but it's not a good idea to talk about it openly...

[rafuzo]

America's favorite straw-man for the right wing comes out saying market pricing mechanisms are a hoax, and it's all a secret cabal of rich old guys? I think there IS a conspiracy here, and it someone trying to get nutty anti-capitalists to agree with O'Reilly, just for sport.

[Jennifer]

JMoore--

The last name "Levin" is very suspicious. That's all I'm sayin'.

[Warren]

We need a new kind of Nielsen rating. Somehow we need to measure stupidity*kilo-viewers. Reality shows would rate pretty high. But Bill's level of stupidity will be hard to top. How many idiots are still watching anyway?

[Douglas Fletcher]

O'Reilly wants to rule the world & apparently has trouble conceiving of a universe that wasn't created in his self-image. Thus when he looks out and sees something he doesn't like he naturally assumes there must be some evil man behind the curtain causing the problem, instead of the collision of desires and means we all know as 'the marketplace.'

BTW I'm available for long-distance psychoanalysis, for only $50 an hour. Cash or credit card, no checks, please.

[Ruthless]

Walter Williams is even older than I, but I bet he could whip O'Reilly's ass!

[David]

Jennifer,

Levin must be one of teh Elders of Zion:)

[Number 6]

Even when I thought it was the bears, I knew it was the jews.

[NaG]

Not to defend O'Reilly, 'cause he's an idiot, but I think people are reading his statements incorrectly. I don't think he's assuming that ONE person sets gas prices for every single gas station. I think what he's assuming is that the price you see at a given gas station (say, Shell) is largely set by that gas company's headquarters, and so he wants to know how those who set those prices do so.

My understanding of how gas prices at the pump work are as follows: The gasoline company builds a gas station and then sells the right to operate it (franchising) to someone. The gasoline company then provides that franchise with fuel to sell. The company then charges the franchise a given amount (which fluctuates) per gallon of gas that is sold. The franchise makes money by charging higher than they are paying to the gasoline company, typically setting the price at about 3-4 cents above whatever the company is charging them.

How the companies set the price the franchises pay I'm sure is a very complicated business, based on availability of gasoline and the cost to deliver that gasoline to the station, figuring in expected future supply and demand. No one person in a company could possibly handle this, and I am pretty sure these things are broken down into regions with a team of analysts responsible for each. I have a feeling that O'Reilly wants to break this down to a nice, pat, simple situation that can be easily denounced, and that is pretty much impossible to do.

[saw-whet]

I just want to know who keeps dumping mountains of snow in Syracuse each year. Just give me the guy's name.

I'm looking forward to saving a ton of money this winter. I'm going to turn my thermostat down to 50. No, no 45!

[Allen Naugle]

Warren asked: "How many idiots are still watching anyway?"

I understand 'The Factor' is, and has been for quite some time, the most popular cable 'news' show...and I use the word 'news' in a post-modern, extremely expansive way.

Doesn't do much for your faith in fellow globe-dwellers...

[crimethink]

NaG,

The system you describe is largely correct, and not only for brand-name gas stations. Virtually all independently-operated stations also get their gas from Mobil, BP, etc, terminals. Many use independent trucking companies to deliver the gas to the station, adding another middleman who must make a profit.

However, the biggest factor in determining prices is competition between nearby stations. This is especially true if you throw a BJ's, Sam's Club, or grocery store into the mix, who usually try to have the cheapest gas in the area, so as to attract customers to their primary business.

[fyodor]

If I were a member of the oil industry conspiracy high command, I'd can this price-setting guy's ass for setting his sites so low. I mean hell, why stop at $3 a gallon? Sky's the limit, baby!!

[Evan Williams]

NaG,

"I think what he's assuming is that the price you see at a given gas station (say, Shell) is largely set by that gas company's headquarters, and so he wants to know how those who set those prices do so."

Except he said, "Which human being in America does that?". Regardless, he implies rather directly that the market plays no part in pricing, and that it's the result of some evil scheming from up on high. His implicit expectation that a company be forced to justify its prices is absurd; Evian charges more for its bottled water than gas costs most places, and nobody is demanding justification from them, even though water is more critical for survival than petroleum.

[crimethink]

I don't think he's assuming that ONE person sets gas prices for every single gas station. I think what he's assuming is that the price you see at a given gas station (say, Shell) is largely set by that gas company's headquarters, and so he wants to know how those who set those prices do so.

On second thought, I'd have to disagree with NaG here. O'Reilly is clearly assuming that one person ("...which human being [singular] in America does that?") sets the price of every gallon of gasoline in America.

[crimethink]

Right on, Evan!

😉

[Timothy]

O'Reilly wants to rule the world & apparently has trouble conceiving of a universe that wasn't created in his self-image.

That'd be one ugly universe.

[Serafina]

Minnesota sets a legal minimum price per gallon for gas stations and fines stations that sell for less.

[Evan Williams]

Serafina,

I think something similar goes on in MD. It's a stupid law that was a result of lazy douchebag private gas station owners colluding with government officials to effectively prohibit big gas discount outlets from offering consumers lower prices. Has to be one of the stupidest things I've ever heard. In effect, consumers are forced to subsidize the continued existence of these old shitty gas stations.

[crimethink]

Evan & Serafina,

I'm not sure about MD and MN, but here in NY it is illegal for a station to sell gas for a lower price than it was bought for. So, technically, there isn't a legal minimum price; a station which buys lower-cost gas can still sell it cheaper than one that pays more for its gas.

But in practice, given the extremely limited number of gas terminals and trucking companies in a given area, such laws do effectively set a minimum price. If our senior senator has his way and price maxima are put in place as well, the govt will effectively be setting the price of gas.

[crimethink]

Of course, the anti-"predatory-pricing" law was supported not primarily by old-fashioned gas-only stations, but by their longtime nemesis, your typical gas station-convenience store combos. They don't mind making zero profit on their gas, since they make ludicrous profits from the C-store.

However, they could not survive a price war with a giant retail chain such as BJ's or Sam's Club, which could lose ten cents a gallon and still make a profit from the primary business.

[Serafina]

A frightening thought, no? Here I think gas stations must charge at least 8 cents a gallon more than they paid, or 6 percent more, whichever is less. And yeah, he justification is that it prevents the big companies from undercutting the few remaining mom-and-pop stations to put them out of business, then jacking up the price sky-high when there's no competition left. In the end, they're doing consumers no favors.

[NaG]

Yes, I know those are the words that O'Reilly used, but I have a hard time believing that he really thinks that ONE PERSON single-handedly determines the price of gas for every gas station in the United States. I think he knows that there are competing gasoline companies. I am more inclined to believe that he mis-spoke, and what he's aiming at are the price-determiners in the different gas companies. He might think that there's one pricing guru in each that signs off on everything, and while that is pretty silly in itself, it's not quite as outrageously out-there as the idea that some Gas Czar controls the American economy.

Lord help me, I'll giving O'Reilly the benefit of the doubt.

[crimethink]

Serafina,

Which is, as you probably know, total hogwash. Monopoly pricing can only occur in industries where there are high barriers to entry; otherwise competitors will enter the market to take a bite out of the would-be monopoly's profits. While the gas station industry does have formidable barriers (zoning, environmental regs of storage tanks, pumping system, etc), these barriers are far less onerous when there is a vacant gas station available.

[dead_elvis]

Finally, all of us can do something. All Americans should cut back energy consumption, as I've said, as much as possible.

Oh my gosh, Bill's a looney lefty! Next thing you know he's going to be telling us all to turn down the thermostat and wear a sweater. Which would be great, except I'm not sure his fans will see the humor.

[crimethink]

NaG,

Isn't this the same O'Reilly who swore up and down, in the face of the objections of our own Jacob Sullum, that a pound of marijuana would fill a shopping cart?

I'm inclined to believe his stupidity (willful or otherwise) has no limit.

[Stevo Darkly]

The Secret Protocols of the Elders of Petroleum.

[NaG]

I am not aware of the marijuana comment. I pretty much stay blissfully unaware of O'Reilly's rantings. I think it's easier to mis-speak on TV when you're talking faster than you're thinking, so I'm willing to entertain that in this instance. But that's purely my personal judgment. On its face, what O'Reilly said was flat-out idiotic. Even under my reformulation, he's wrong. You say to-may-to...

[John Hensley]

Jesse,
I've come to the conclusion that most people are just born without the lobe that understands market-driven pricing. They will never get it, no matter how many times and how many ways it's explained to them. All you can do is make sure they don't write their confusion into law.

[crimethink]

NaG,

I apologize for being snippy on this subject, but public ignorance on the topic of gas pricing is always a thorn in the side of a gas station manager. Six days a week I have to listen to ignorant customers complain about high gas prices which I have precisely no control over.

Not to mention the threatening letters I get, accusing me of price gouging, despite the fact that our prices are lower than most stations in the area.

[Jared]

Well that ties up both ends. Clearly Bill's still smoking schwag, pounda that'll fill up a shopping cart.

Wake up man, its not the 60's anymore. We got denser buds now man.

Fucking conservatives romanticizing the past I swear.

[crimethink]

IIRC, O'Reilly asserted that during a "discussion" with Sullum and the then-Assistant Drug Czar, about a referendum in some state (NV?) which would decriminalize possession of up to a pound of marijuana. After Jacob had uttered a grand total of five words, OReilly began shouting him down, accusing him of trying to legalize drugs because he wanted to use them.

[theOneState]

But there's still an interesting question: who's collecting the apparent windfalls?

O'reilly thinks it's the big oil companies. It would be interesting to chart the price of gas at each stage - oil, refinery, distribution, retail. (If nothing else, you'd think O'reilly could have gotten his hands on s/t like this....)

[Mike H.]

A shopping cart full of marijuana is a life-long dream of mine. Mmmm....

[NaG]

Don't they already have a pie chart that tells you where your money paid for a gallon of gas goes? I think I've seen something like that once.

[Swill]

I think it's easier to mis-speak on TV when you're talking faster than you're thinking.

Bill O'Reilly could be talking in a cadence slower than the difference between Forrest Gump and Karl Childers from Sling Blade and still be talking faster than he thinks.

[smacky]

This is a threadjack!

Put your hands up!
Ok, now turn around in a circle two times.
Put your right leg in.....

No, really. Anyone who is interested in meeting up for alcohol-related socializations (alcohol not required, but preferred) on the weekend of October 15th in Washington DC, email me! My email address is real if you take out the "nospam." part. I have two evenings in mind for a get-together. Email me for details, even if you're only non-committedly interested at this point. We can decide between the two or so dates I have in mind, and then decide on a time/place.

[Larry A]

It would be interesting to chart the price of gas at each stage - oil, refinery, distribution, retail. (If nothing else, you'd think O'reilly could have gotten his hands on s/t like this....)

It would be interesting. But it wouldn't do much for O'Reilly's point of view. It would show unequivocally that the big jumps in prices come precisely where the state and federal taxes are added.

[theOneState]

It would show unequivocally that the big jumps in prices come precisely where the state and federal taxes are added.

Maybe, but the point is to track it over time, see who charges what when. If you could track the profit margin of each sale, I'm sure you'd reveal some price shenanigans.

You occasionally see an individual gas station charge exorbitant prices (temporarily) to take advantage of fear or uncertainty of customers...hard to believe other actors in the process don't do the same thing. (I know Enron is no more, but most of those assholes are still working somewhere.)

[quasibill]

One thing about the gas pricing mechanism that I haven't seen mentioned, yet know from my summer employment during undergrad (yeah, many moons ago):

The franchisor (i always mix the terms up, so forgive me if i get it wrong - i mean the guy who contracts with the big company to run the station) usually makes very little money per gallon - quite often fractions of a penny. The big bucks came from month end bonuses that were awarded on volume of oil moved. I think the bonus levels were set in relative terms within given regions, but I may be misremembering that. So the pricing mechanism of the franchise I worked for, at the very least, had a VERY strong inclination towards the lowest possible price per gallon.

Just thought I'd mention it.

[Shawn Smith]

crimethink,

If it was the NV referendum, then there was nothing to worry about. In 2002, the Fundies, Mormons, and Catholics were coming out in force to support Question 2, to codify marriage as between a man and woman. There was no way on Earth any drug "legalization" proposal was going to go anywhere. In 2004, the statists were for raising the sales tax from 7.5% to 7.75% to put more cops on the street. Again, there was no reason to believe those forces would be in favor of decriminalizing MJ.

[Isaac Bartram]

Shawn

In the face of that, though, didn't the NV referendum get something like 39% for.

Call me an optimist, but that was the most radical legalization initiative ever, anywhere, that I know of.

[mike]

O'Reilly says stupid outragous comments becuase he knows that a lot of people will actually beleive what he says. It is just for the ratings so he can fill up his pockets. I do have say that I watch The O'Reilly factor on Fox, it's funny how he makes himself look like an a**.

[mike]

O'Reilly says stupid outrageous comments becuase he knows that a lot of people will actually beleive what he is claiming. It is just for the ratings so he can fill up his pockets. I like to watch The O'Reilly Factor becuase it's funny when he makes himself look like an a**.

Sorry that I posted my comments again, but I had to correct my mistakes.

[mike]

O'Reilly says stupid outrageous comments becuase he knows that a lot of people will actually beleive what he is claiming. It is just for the ratings so he can fill up his pockets. I like to watch The O'Reilly Factor becuase it's funny when he makes himself look like an a**.

Sorry that I posted my comments again, but I had to correct my mistakes.

[mike]

O'Reilly says stupid outrageous comments becuase he knows that a lot of people will actually beleive what he is claiming. It is just for the ratings so he can fill up his pockets. I like to watch The O'Reilly Factor becuase it's funny when he makes himself look like an a**.

Sorry that I posted my comments again, but I had to correct my mistakes.

[dagny]

I think it's easier to mis-speak on TV when you're talking faster than you're thinking.

Umm, we're not talking about someone mis-speaking in a fast-paced interview, I'm pretty sure the Talking Points Memo is written out and teleprompter-ed to O'Reilly.

[Pro Libertate]

I set the prices that make the whole world scream
I set the prices for oil and petroleum things
I set the prices that make Bill O'Reilly cry
I set the prices, I set the prices

[Tom Crick]

"I think the bonus levels were set in relative terms within given regions, but I may be misremembering that. So the pricing mechanism of the franchise I worked for, at the very least, had a VERY strong inclination towards the lowest possible price per gallon."

The pressure is even greater now. You may have heard about Union 76 attracting bids from Chinese investors--well for the past few years, they've been closing and selling poorly performing stations like nobody's business. I haven't done it for a while, but if you go on Loopnet and search for Union 76 stations for sale in Ca., I bet you'll get an enormous list.

...The idea, as I understand it, is Union 76, and other competitors too, want to sell more gas out of fewer stations and cut their distribution costs. So if your station doesn't sell enough volume, they'll kill your distribution contract and you'll either a) have to go independent or b) close down. ...The overwhelming majority of those 76 stations you see for sale on Loopnet closed down...

Gas stations make their money on store items, auto repair and car washes.

...Oh, and did anybody take O'Reilly to task for not mentioning taxes as a prime culprit? What's gasoline trading at right now, about $2.00 a gallon? The rest of what I pay at the pump isn't all distribution costs, that's for sure. Can you believe the Bush Administration would rake poor, fleeing hurricane victims like that? ...What a sick bastard!

...he could have had a take like that...but NOOOoooOOoo!

P.S. Has anyone mentioned that Shell has been trying to sell one of California's three major refineries for years because they can't operate it profitably, but they can't get anyone to step up and buy it? ...My understanding is that Shell keeps threatening to close it, but the state of Ca, keeps threatening to retaliate against its ability to sell gas in Ca.