Inflation from Fossil Fuels

Here is my line of reasoning on inflation:

1. Prices are set by companies based on supply and demand. There are no government price setting mechanisms. This is the free market in action.

2. The primary price driver of many, many items is energy. Energy costs are built into the price of everything. Energy costs go up, prices go up.

3. Energy costs are still based one the fossil fuel industry, primarily oil. (Long term, renewables should help reduce this dependency on oil, but not immediately).

4. The price of oil is determined primarily by the future/commodities markets, in which investment firms and speculators play a role, which helps drive up the cost of energy (free markets).

5. The oil companies (worldwide) have the ability to increase supply but have chosen not to in order to keep the price of oil high.

6. When the price of oil goes up, production costs DO NOT go up, hence the oil producers simply make more money. Hence the free market motive not to increase supply.

7. Oil company profits are currently huge. Oil companies have made windfall profits because of the surge in oil/gas prices. (Exxon posted over 5 billion in PROFITS in the first quarter, nearly double from previous year. Profits are AFTER all expenses and costs are paid).

8. This extra money is coming from the consumers (general population) as money is transferred from the people to the fossil fuel corporations (no government involved).

9. Fossil fuels (emissions after burning) are the primary cause of climate change.

10. The Democrats are more aggressive than the Republicans (deniers) on climate change.

11. The fossil fuel industry loses business if action on climate change moves money from the fossil fuel industry to the renewables industry.

12. The fossil fuel industry loves the Republicans and, in fact, gives huge monies to the Republicans. Hence, many (most) Republican legislators have strong biases towards the fossil fuel industry and against action on climate change.

13. The high price of gasoline makes most people angry and they blame the government (wrongly).

14. The high price of gasoline makes people angry with Biden and the Democrats (wrongly).

15. The Republicans are aided by this anger and help to promote it in order to benefit in the elections.

Conclusion:

THE OIL COMPANIES WANT HIGH PRICES because of profits and because it benefits their political ambitions to keep climate change action to a minimum.

This is how concentration of wealth happens, which I think is the root cause of the political discontent in the country. (Of course, there is also tribalism/racism and loss of democracy as additional issues).

This why we are so threatened by climate change and our do-nothing attitude.

We, the people, are so screwed by this system and the Republicans are once again doing harm to the common good of America.

V