U.S. allowed oil industry to put us in a headlock

We have no one but us to blame for the high price of gasoline.

Over 30 years, our government has allowed the oil industry to exempt itself from economic laws of supply and demand. We watched political leaders shirk their responsibilities to American consumers.

First, we allowed oil to become a political weapon. At one time, those who control oil supplies did so based largely on their own economic interests — real or perceived. Big oil companies had at least moderate influence over how much oil was produced by oil-rich nations. Today, production decisions are driven more by politics than economics. Iran, Venezuela, Russia and nations of the Mideast care little about market demand; they use oil as a political weapon. And when oil nation dictators start building refineries and shipping finished products, American consumers will be in even deeper trouble. Our leaders for the past quarter century have done a poor job of making sure U.S. interests are included in political goals of oil-producing nations.

Second, we allowed too much consolidation in oil refining and distribution. Today, those activities are in the hands of about five giant companies, worldwide. Three of the five companies are outside the United States, and the other two are only nominally within our borders. It may look as if different companies own service stations, but most stations are controlled by two companies whose names you don't even know. These phantom companies bought old-line retail names in order to make the oil business appear competitive.

When whole industries are controlled by quasi-monopolies, supply and demand are easily manipulated. Congress should spend less time on partisan infighting and more time looking into anti-competitive activities in the oil business.

Third, we allowed ourselves to be bamboozled by big agribusiness into thinking ethanol from corn might help. It takes almost as much oil to produce a gallon of ethanol as it does to produce a gallon of gasoline. That means ethanol production increases demand for oil, pushing gasoline prices up, not down. Ethanol production also increases demand for corn, raising consumer prices for corn-based products — everything from beef and chicken to bread, cooking oil and soft drinks (sweetened with corn syrup). American consumers are the losers.

American farmers are not far behind, because they ride a short-term wave of unwarranted optimism. Too many of our political leaders fell for the ruse. Agribusiness wins. Taxpayers lose. Tax subsidies for ethanol production should be eliminated.