Every once in a while, he'll throw the liberals a bone, such as when he came to Obama's defense on the "pigs wearing lipstick" comment and suggested that the McCain campaign, responding to the cheap shot, was resorting to a doubled-edged sword by making OBAMA the victim, I was exasperated. I've already commented on this topic in previous posts, but he gave a speech the day before where he attacked Palin's submissions of earmarks as "pork" (Palin has no vote in the earmark approval process, but Obama does, in approving the Bridge to Nowhere and hundreds of millions of his own earmarks). The "lipstick" reference from Palin's acceptance speech was recognized immediately by Obama's audience, and this Harvard-trained lawyer, who paused as the audience laughed, knew exactly what he was saying and doing.
That being said, I do think, given the fact you have a candidate (Obama) whom has knowingly distorted McCain's "100 years in Iraq" comment and whom has continued to link McCain with Bush, despite McCain's 2000 battle for the nomination and several major differences in position with Bush (taxes, earmarks and spending, Iraq, torture, energy, Medicare drug benefit, etc.) , and given an environment where Governor Palin has been personally attacked for her fitness as a mother, compared to Pontius Pilate, accused of having an affair with her husband's friend, and the like, the "pigs/lipstick" controversy seems to have be one of the lesser smears.
If I had been Sarah Palin, I would have laughed it off and said something like "I've been called a lot worse in Alaska." Sarah Barracuda is a tough lady; you have to have a bit thick-skinned if you go into politics and you take on corruption, the oil companies, and your own party leadership. The last thing she needs is the GOP treating her like she's a china doll.
Last night O'Reilly had on his show Fox business host Neil Cavuto, and immediately goes into one of his populist kicks on Big Oil, noting that the price of gasoline is not going down right now as fast as the price of oil. He's screaming oil company greed. Unfortunately, O'Reilly doesn't understand the underlying economics. First, the oil companies (e.g., Exxon and Shell) have been divesting their gasoline retailing locations, something they would not be doing if they found the retailing business a good profit center. Second, look at the big refiner/retailers, like Valero; today, Valero closed down about 4% to $30.53/share while crude oil closed up 4%. Valero is trading about $1.50 over its 52-week low while its 52-week high is $75.75. This is with oil at one point today at $95/barrel. Also, Valero has a number of refineries which can process less expensive sour oil, and given its size, it should have a cost advantage over competitors whom rely on sweet oil.
The fact is, the retailers face a problem in that as the price of gasoline goes up, there is more limited demand for their products; drivers may opt to lower gasoline costs by minimizing gasoline usage through behavioral changes (e.g., working from home, cutting back on vacations or other discretionary driving, carpooling, or mass transit) or technological changes (e.g., flex-fuel, electric or hybrid vehicles). Of course, certain professions are likely to pay whatever the going price is, at least over the short-term (e.g., taxi drivers, truck drivers, airline pilots, etc.)
One of the factors that O'Reilly fails to take into account is the fact of currency changes where most sources and consumers of oil lie outside the United States. Due to the twin deficits (budget and trade), the dollar has declined relative to other currencies. So in addition to the natural price effects due to a limited slack between total oil export levels and aggregate import demand, we have an additional price increase due to the fact we have to pay a higher price in dollars because of the loss of purchasing power of a dollar. This is part of the price we pay in large part for domestic political obstruction in development of our own oil sources (in particular, oil shale and offshore). One example is the current Democratic House "compromise" energy bill which allows limited drilling (subject to state consent) outside a 100-mile range offshore; some industry sources claim some 88% of known offshore resources are within the 100-mile range. (The President has already made it clear this bill is dead on arrival; even if it carries the Senate, where it would almost certainly be filibustered, the President's veto will stick.)
Note also over the past few weeks with some European economies already in recession, weakness in global economic and stock markets, there has been increased demand for safety, i.e., US treasury bills. This has increased demand for the dollar, at least in the short run, and accordingly the drop in the price of oil reflects not only the softening oil demand because of global economic weakness, but also the currency effects of a strengthening dollar.
Going back to Bill O'Reilly's simplistic, one-sided economic analysis, notice that he wasn't griping about the fact that when oil was just under $100/barrel, gas was selling at about $3.27 a gallon. When oil peaked at roughly $147/barrel several weeks back, why wasn't Bill O'Reilly complaining about gas prices not being roughly $5/gallon instead of a $4.11 average peak this summer? What a hypocrite! He certainly wasn't a Valero shareholder watching his stock price sink like a rock given the fact that Valero couldn't pass along all its costs without killing demand even further.
The fact is that Valero and other retailers still have a cost basis of up to $147/barrel in the channel, and I don't doubt that the retailers will try to recoup their margin as the more expensive oil works its way through. However, there is a natural incentive to drop retail prices with cheaper oil, since a local retailer can capture market share by maintaining a reasonable markup. Chances are, assuming continued weakened global oil demand, we can probably expect price drops approaching $3/gallon. (Currently, we have to work ourselves past the price distortions relating to Hurricane Ike due to product supply disruptions from the Gulf of Mexico refineries.)
Let us just hope that American consumers don't return to being pinheads, treating $147/barrel like a bad dream and reverting to old gas guzzling SUV's and trucks. We need vigorous American oil exploration and development, not to prolong an American addiction to gas guzzlers, but because we need interim options, not Barack Obama/Nancy Pelosi states of denial, repeating the same old same old political paralysis spin about not being able to drill our way out of the problem, no short-term price relief, limited reserves, etc. We don't need to throw tax incentives at self-righteous overpaid liberal Hollywood actors to buy the latest alternative energy cars and hotels. We don't need corn ethanol boondoggles with inadequate delivery infrastructure, poor energy-efficiency yields and food inflation side effects.
We need to do more proper analyses with a focus on multiplier effects in energy efficiency. For example, offering lower-income people with tax credits for trading in older, energy-inefficient vehicles and appliances, solar paneling of apartment buildings, etc. In addition, we need to look at other steps such as lowering tariffs on Brazilian ethanol, expediting the construction of coal-to-liquid refineries to better use our immense coal reserves, building out (as Pickens suggests) more compressed natural gas vehicles and tax-subsidied vehicle conversions, etc.
