Oil & Gas Prices

I caught Wednesday’s edition of “The Daily Show” on rerun, specifically a segment on gas prices with Wall Street Journal writer Rebecca Strassel. After fussing at those excessive oil company profits, host Jon Stewart joked that she felt like “you’re talking to a retarded person,” then insisted (with some self-deprecation) “The important thing is my visceral emotional reaction to it.” Smiling throughout, Strassel said he should be mad at Congress for its policies (such as its mandated use of ethanol). Stewart replied: “I’m mad at an administration that feels they have the vision to spread democracy -- I will, you know, invade a country and it will flower like the Genesis Machine -- and yet when it comes to oil, their most innovative solution is (in dumb-guy voice, like David Letterman asking if you got any gum) ‘uh, what if we look in Alaska?’ It lacks imagination to some extent.”

The broadcast network evening newscasts on Thursday night hyperventilated over “record” profits for ExxonMobil, but failed to point out how government taxes exceed oil company earnings. ABC even fretted about how much ExxonMobil “spent rewarding shareholders,” though it was less than the federal government took in taxes, and NBC excoriated the company for “cashing in” at 9.5 cents per dollar.

“Today, ExxonMobil reported profits of $8.4 billion for the first three months of this year, its best first quarter ever,” ABC anchor Elizabeth Vargas asserted at the top of World News Tonight before Betsy Stark complained: “The company says that's a record level of investment in new supplies. Maybe so, but it's less than it spent rewarding shareholders. 15 percent of profits went directly to shareholders in the form of cash dividends, and the biggest chunk, 40 percent, was used to repurchase Exxon's own stock." But ExxonMobil paid 83 percent as much as the $8.4 billion it earned, $7 billion, $2 billion more than a year earlier, in just federal income tax -- and a lot more in other taxes.

Over on the NBC Nightly News, anchor Brian Williams promised, in his tease, “a reality check on sky-high oil company profits,” but all Lisa Myers delivered was demagoguery. Myers began by charging that “for outraged consumers, the staggering profit numbers boil down to this: Exxon earned 9.5 cents on every dollar of gasoline and oil sold, cashing in at every stage of the process." Yes, ExxonMobil cashed in by investing and working to get their product to the retail customer while the federal government collected 18.4 cents per gallon in tax for doing nothing. Federal, state and local taxes total an average of 46 cents per gallon -- significantly more than the 28 cents Exxon earned on a $3 gallon of gas. (Transcripts follow.)

Perhaps it's not surprising from a network that once spun $2.15/gallon of gas as "averaging under $3." The April 26 "CBS Evening News" overestimated ExxonMobil's forthcoming profit margin.

Jumping the gun on the other networks, "CBS Evening News" reported on the April 26 broadcast that ExxonMobil would report a $9.4 billion profit for the first quarter of 2006. The actual figure, released the morning of April 27, is an $8.4 billion profit, a $1,000,000,000 difference. This isn't CBS News's first time being sloppy with numbers.

The Free Market Project previously reported how CBS exaggerated the rise in natural gas prices heading into the winter of 2005-6:

NBC's Today show was full of negative news for President Bush, as it usually is, so it was a bit surprising when Katie Couric asked Tim Russert why the President hasn’t gained from positive consumer confidence. Maybe it’s because, according to a quick Nexis search of Today, the phrase "consumer confidence" hasn’t even been uttered all year long. During a segment on the bad news for the President in NBC’s latest poll Couric noted:

"We just see the right direction, wrong track question Tim and we can follow that by the economy. Only 19 percent feel confident when it comes to, excuse me, the economy and 77 percent are uneasy. One of Josh Bolten's five point plans, as you know, Tim was to brag more about the economy and there is good news. Consumer confidence this month is at its highest in four years. The Dow is trading at a six-year high. Obviously they've got their work cut out for them but why aren't some of those good things reflected in the poll numbers?"

All three network morning shows played the envy card Thursday morning, as they hyped the “record high profits” and “corporate greed” of American oil companies. High on their agenda: ExxonMobil’s announcement of $8.4 billion in profits, which the networks implied was scandalous given the high price of oil.

But unstated in the network coverage was the fact that the U.S. government took in more than $7 billion from ExxonMobil during the first quarter of 2006, a jump of more than $2 billion from the same time period in 2005. And that doesn’t count the more than $7.6 billion in excise taxes — the gas tax — that ExxonMobil collected for the government during the same quarter. Plus another $11 billion in "other taxes" and ExxonMobil sent the government more than $25 billion in the first quarter of 2006 -- three times more than the amount network reporters seem to feel is obscene.

Big Government is making more off of high gas prices than Big Oil.

The media has recently put on quite a show about high oil prices. On Good Morning America reporter Ron Claiborne is spending the week on the road and hunting down motorists who want to "talk back to the oil companies". Today he was live from a gas station in Cleveland, Ohio.

In his report, Claiborne stated that "the mood on the road that we found is one of outrage. People are very, very angry over those high gas prices like you see right here. And also over those corporate profits, those oil company profits. And it's also a mood of suspicion and in some cases fear."

One "boiling mad" motorist ranted, "They're making billions and I'm making nothing. I'm poor. You know, I've got to pay $3 a gallon. It's cutting into my food bill and travel bills and my shoes and everything."

Meredith Vieira just can’t help herself. The View co-host will soon be taking over for Katie Couric on the Today show. One would think that she would try and reign in her bias. Apparently not, as she opened the April 26 edition of The View with another attack on President Bush:

Vieira: "...I’m a little peeved when I hear the President say there’s not much we can do about this, folks. According to the President, the American people have got to understand that what happens elsewhere in the world affects the price of gasoline that you pay here, but where is his responsibility in all this? Five and a half years and we’re dealing with these gas prices? It’s ridiculous."

Video clip (37 seconds): Real (1.1 MB) or Windows Media (1.3 MB), plus MP3 audio (220 KB)

On the April 24th edition of Fox’s syndicated Geraldo At Large, Geraldo Rivera said the bright side of high gas prices is "it may cut down on global warming" and then went on to call oil company CEO’s "pirates," and backed a windfall tax on the companies as "a no-brainer."

The following is Rivera’s entire final commentary from the show:

Geraldo Rivera: "About the only good news is that it may cut down on global warming but exploding gas prices are hurting lots of people along the way."

[Man at gas station: "Gas prices just make you definitely want to take the train all the time."]

Networks focus on ‘staggering’ pay and pensions for Exxon and other corporate CEOs, even as media companies fight SEC rule on disclosing high salaries.

Free Market Project

Gas price rage has blended with executive pay rage recently, since the media have been bashing ExxonMobil’s departing CEO, Lee Raymond, for his pay and pension package.

“Runaway pay,” said NBC’s Brian Williams on April 20, calling executive salaries and benefits “stratospheric” and “staggering.” CBS’s Bob Schieffer compared Raymond’s “golden” retirement to the “average American” on April 13. “How much is too much?” asked NBC’s Matt Lauer on April 11. And ABC’s “Good Morning America” said, “You Must Be Kidding!” referring to Raymond’s package as “stunning” on April 14.

Criticizing highly-paid executives has been in vogue at the news networks lately, but there’s something the anchors aren’t telling you: their colleagues’ top wages could soon be disclosed to the world, and Big Media are fighting it.

Large media companies have been doing everything within their power to hide the compensation plans of their own highest-paid employees from public disclosure. As reported by the Associated Press on April 11:

The broadcast network evening shows delivered a variety of spins Tuesday night on the price of gas, with CBS raising a “windfall tax on big oil” and featuring an in-studio segment with left-wing busybody Eliot Spitzer, the Attorney General of New York, about price gouging and NBC's Brian Williams worried about the concerns of those want a “greener America.” ABC's Betsy Stark rejected the price-gouging charge and while CBS insisted that eliminating environmental regulations would have little effect, Stark reported such a suspension would have an immediate impact.

CBS Evening News anchor Russ Mitchell asked White House reporter Jim Axelrod about the idea of "slapping a windfall tax on big oil companies for these record profits that they're making?" Mitchell then turned to Spitzer: "As a consumer, it seems like it's the wild West. How easy is it for a gas station, for an oil company to just jack up the price of gas?" NBC's Williams set up a story on President Bush's proposals by citing how “advocates for a greener America” are “seeing red over what they see as a quickly degrading environment." Williams soon asked David Gergen "what are the chances” that the high prices will lead the U.S. to now move from a “carbon based society to one that's more green?" Gergen replied: "Well, one hopes that's the case...” (Transcripts follow.)

For a few days, it looked as though maybe MSNBC's First Read - written in part by NBC's political director Elizabeth Wilner - was being more careful with their poll numbers. Then, from today:

The New York Daily News says the same CNN poll showing Bush's approval at 32% also notes that 69% "said gas prices were causing them severe financial hardship."

Well, they quoted the Daily News accurately enough:

Sixty-nine percent of Americans in the CNN poll said gas prices were causing them severe financial hardship.

Take a look, though, at the actual poll. Forty-Six percent say gas prices have caused "moderate hardship," while only 23% say "severe hardship."

As reported last week, Dave Price, the weatherman on CBS’s "The Early Show" went to Iraq along with country music artist Charlie Daniels to entertain American troops. This morning, Price gave the first part of a two part series detailing his travels and interaction with the troops.

Once again, Price reassured viewers that troop morale is high, and showed some comments from men and women in uniform, for instance Price made the following statements:

"I went to cheer up the soldiers, but in most cases, they didn't need it."

"Of course morale was sky high during the shows, but what surprised me was what I heard after the music and the laughter faded."

Miles O'Brien may be CNN's resident NASA expert. But that doesn't make him a rocket scientist, and it sure doesn't make him an economist.

Maybe that's why he thinks raising taxes will help alleviate high gas prices.

There “could be a good argument for a gas tax in all of this to help pay for these alternative fuels,” the “American Morning” co-host suggested on the April 25 program.

“We have enough gas taxes, don’t you think,” reporter Carol Costello fired back.

Every American motorist already pays 18 cents on the gallon to Uncle Sam and anywhere from 8 to 45 cents per gallon to state governments, according to figures compiled by the American Petroleum Institute. In fact, the Energy Department estimates taxes account for 19 percent of the price of a gallon of gasoline, nearly as much as the 22 percent of the price that goes to refining costs.

Have a look at the two screen captures from this morning's shows. Same issue, different takes. Good Morning America is apparently sure that gas price gouging exists, and wants to stop it. 'Today' is agnostic, simply posing the question whether gouging is going on.

But when you turn to the substance of the two segments, there was one consistency: neither show adduced any evidence of gouging. Not a scintilla to show that oil companies are in fact colluding. And without collusion there can be no sustained gouging, since any company that pushed prices higher than market levels would immediately lose its sales to competitors.

Over at GMA, the guest was Senate Majority Leader Bill Frist, for all the world looking like a politician wanting to give the appearance of doing something about a problem over which he in fact has little control.

Sawyer opened by raising the gouging issue: "You are targeting gouging, which is the guy at the pump, the middle guy. How is this going to help and how soon, specifically, the person paying $2.91 on average right now?"

A seemingly sympathetic Frist replied:"Diane, you're exactly right. This $2.91, over $3 in some areas right now, cannot be sustained by the person driving their kids to school or filling up their tractor with fuel."

Much as this column is quick to point out the prevalent liberal bias of the MSM, fairness compels us to acknowledge those occasions, rare as they might be, when the MSM plays it down the middle.

NBC's handling of the recent spike in gasoline prices could be shaping up to be one of those flying-pig moments of 'fair & balanced' coverage. At the very least, there are indications that the conventional wisdom within NBC News is that the Bush administration is not to blame for the high prices, and/or that there is little government can do to stem the price rise.

As noted here earlier today, Katie Couric and David Gregory both expressed skepticism on this morning's Today show as to the government's ability to do much in the circumstances. Gregory was back at it this evening, guest-hosting for Chris Matthews on 'Hardball.'

When yet another gloomy segment on gas prices and the pessimistic prospects for the GOP finally drew to an end on this morning's Today show, you might have thought that a fluffy piece on crosswords and how mental games help keep aging minds sharp would have offered a respite from liberal media bias.

Think again.

Hollywood-handsome NBC reporter Peter Alexander somehow managed to work into his segment clips of two liberal icons: Bill Clinton and Jon Stewart! Both are apparently crossword aficionados. Who knew?

On the public-access TV show I host, 'Right Angle', the topic this past week was immigration. A Cornell campus radical expressed the view that not only should our borders be completely open, but that we shouldn't screen immigrants for criminal history or even . . . for being known Al-Qaeda members.

Now, if the radical making these sophomoric suggestions isn't quite a sophomore - he's in fact a grad student - perhaps some slack can be cut him as he continues to live, largely divorced from reality, within the liberal cocoon of the ivy-league tower.

The same defense cannot be offered to explain away the equally churlish remarks that Dave Rossie serves up week after week. Rossie is associate editor of the Gannett newspaper, the Binghamton [NY] Press & Sun Bulletin. In addition to his editing duties, Rossie writes a syndicated weekly column that, in its juvenile tone, reads like something worthy of an over-the-top 10th grader.

As they did all week, on Friday night the three broadcast network evening newscasts again hyperventilated over the “record” high price for a barrel of oil, though adjusted for inflation, the only competent way to measure any price over time, current $75 per barrel oil is $12 short of the real record high set in January of 1981. ABC anchor Elizabeth Vargas falsely cited how “a week of skyrocketing oil prices ends with another record today,” erroneously claiming that “records were set on four out of five days, and today the price for a barrel of crude topped $75 for the first time ever.” CBS's Bob Schieffer announced that “we end the week as we began it, and that is not good news because we began this week by reporting that the price of crude oil had reached a record high.” Over on the NBC Nightly News, fill-in anchor Lester Holt had as little regard for accuracy as had Brian Williams the rest of the week. "Pain at the pump,” Holt teased, “Yet another record high for oil.”

Friday's World News Tonight also featured a preview of a taped session with California Governor Arnold Schwarzenegger set to air on Sunday's This Week. Vargas passed along how the liberal Republican “warned that price-gouging on oil and gas will not be tolerated. He told ABC's George Stephanopoulos he would not rule out taxing oil companies on their enormous profits." In the brief excerpt then shown, Stephanopoulos cued up Schwarzenegger: "So do we need a windfall profits tax?" (Transcripts follow)

MRC's Mike Rule noticed CBS's "Early Show" on Friday was going to extremes to play up the drama of recent gas price increases. People are now suddenly pawning items for gas money?

Julie Chen: “Oil prices reached a new record this morning, at one point they topped $73 a barrel. That's not helping high gas prices; some are going to extremes to pay for gas, pawning their belongings.”

On this morning's Today show, NY Times foreign affairs columnist Thomas Friedman repeated his astonishing wish that the price of crude oil . . . go to $100/barrel ASAP. This is apparently a favorite Friedman mantra, as NewsBusters/MRC's Tim Graham and Brian Boyd have noted.

Friedman's theory is that extremely high oil prices are desirable because they would induce behavioral changes that would ultimately decrease demand and force oil prices way down. Here's how the exchange with host Matt Lauer unfolded:

Friedman: "I hope the Iranians get as crazy as they want. My attitude toward the president of Iran is 'you go, girl', because the faster we get to $100 a barrel, pal, the quicker we're going to get back to $20. Because when we go to $100/barrel, then you're going to see all these people change their behavior and their oil-buying habits and their car-buying habits in a fundamental way."

CBS and ABC played to petty jealousies on Thursday night. Both aired silly stories which contrasted the large retirement package, earned by former ExxonMobil Chairman and CEO Lee Raymond, with the average retiree income or the burden rising gas prices supposedly put on a typical family. CBS Evening News anchor Bob Schieffer announced: “The average American enters the golden years -- retirement -- expecting to live on less than $30,000 a year, and that includes Social Security. Well, it turns out to be a little more golden than that if you run a big oil company,” as if it's news that a successful executive, just like a network anchor, would retire with more than the average income. Reporter Anthony Mason proceeded to hype the biggest number possible -- “Lee Raymond is being rewarded in his retirement with a breathtaking package worth nearly $400 million” -- though that counts stocks and options which will take years to amass. Mason concluded by pointing out how Raymond made $190,000 a day in 2005 while “the average American worker...earns $43,000 a year." The Washington Post reported that Raymond may just get $8 million a year for his pension -- half what CBS will pay Katie Couric to read a tele-prompter for a half hour a night.

ABC's World News Tonight featured a “First Person” account from a man who claimed rising gas prices are “forcing him to change the way he and his family live their life.” Gary McIlroy used his ABC platform to lash out: “The oil companies continue to have soaring profits and soaring prices. And the American people are the ones taking it. We're the ones being gouged. So I sent a letter to the White House, saying, you know, we can't take this anymore if prices continue to go up and our paychecks are staying the same.” Vargas then ludicrously linked gas prices to Raymond's compensation, as if supply and demand have nothing to do with it: “Those high gas prices, in the meantime, are helping finance one of the richest retirement packages in U.S. corporate history. Former ExxonMobil Chairman Lee Raymond received compensation worth nearly $400 million when he retired last year.” Unmentioned by Vargas: How the chief of Disney, which owns ABC, got a lot more when he departed. (Transcripts follow.)

This morning's NBC "First Read," ostensibly an analysis by NBC News's Political Director Elizabeth Wilner (and others), misleads about the contents of an NBC/WSJ Poll:

The NBC/Wall Street Journal poll and other surveys continue to show that Americans have little appetite for extending the tax cuts in the face of more pressing domestic concerns -- including energy prices.

The poll contains exactly two questions about taxes. By a 49-29 margin, respondents said they were more likely to vote for a candidate favoring "making the tax cuts of the past few years permanent." And by a 56-39 margin, respondents support the tax cuts (Question 18). Gas prices do not show up on the list of questions. The only support for Wilner's comment is that by a 49-19 margin, people asked are more likely to vote for someone who "emphasizes domestic issues over military and foreign policy issues," leaving those issues completely unspecified.

While ABC and NBC presented viewers last night with many of the reasons for the rising cost of gasoline, CBS ignored the link between Iran’s push for nuclear power and rising oil prices. Instead, the network cheered on a “corporate catfight” between automakers and oil companies.

“I won’t be able to afford either rent or gas,” CBS News’s Anthony Mason showed a woman complain on the April 11 “CBS Evening News.” Warning of $3-a-gallon gas this summer, the CBS correspondent sought a culprit in American business, and highlighted a war of words between corporate executives.

Mason pointed to a blog posting by a DaimlerChysler executive blaming oil companies for high prices, and an ExxonMobil advertisement blaming SUV makers for fuel inefficiency.

On a light news day, why not run a generic piece on President Bush's low poll numbers and his assertedly bleak prospects for reviving them? That was apparently the thinking at the Today show this morning.

Today themed the segment "Can Bush Save Presidency?", and NBC White House reporter Kelly O'Donnell seemed to answer the question in the negative, kicking things off with this gloomy assessment:

"For President Bush, low poll numbers have not just been a dip or temporary rough patch but appear now to be a sustained pattern that is different than his predecessors of both parties who went through their own tough times." She continued: "His . . presidency appears to have a chronic case of the below-40 percent blues."

After David Gergen was shown suggesting that "presidents have sometimes broken out of slumps when they've had big, bold initiatives and unexpected victories - that often shake things up" O'Donnell reappeared to dump cold water on the notion that W could have any such luck:

"Looking back, some second-term presidents have been able to rebound. President Reagan's approval fell to 34 percent with the arms-for-hostages scandal. Pres. Clinton hit 41 percent around impeachment. But both bounced back up to the 60s as they left office. Analysts say the prospects for Mr. Bush are not as good because of the weight of ongoing events: Iraq, gas prices, the CIA leak case and hurricane response."

Gergen popped back up to pessimistically proclaim: "After a while those negative feelings really do congeal, they crystallize, they become firm and then it's very hard to break out."

O'Donnell: "political observers claim big speeches and staff changes won't turn things around and suggest the president may have to wait to seize on any good news."

Commentator Stu Rothenberg then observed: "If there is something he can brag about he needs to quickly then be able to go to the American public and make his case and drive home the point. But for now he simply doesn't have much ammunition at his disposal."

Count on Today and its MSM cohorts to do their best to keep things that way.

In a flashback to last summer and a preview of this summer, Charlie Gibson accused oil companies of dictating the price of oil.

Gibson began an interview with a financial contributor for "Good Morning America" by asking if $3 a gallon was inevitable this summer. Mellody Hobson answered yes, then pointed out that oil prices managed to rally despite the warm winter.

Then Gibson complained, "Which leads everybody to be very cynical about what the oil companies are doing: it's a warm winter, so they have extra supply of oil; and they made record profits last year. So they can't get ready to give us decent supply this summer?"

Hobson: "Well the supply may be there but the issue is the market sets the price for gas around the world. And so if they can sell gas at $60 a barrel in the rest of the world, they're going to sell it at $60 a barrel in the U.S. They're not going to sell it cheaper."

Have a look at the chart at the bottom and answer one simple question: what's the biggest gasoline-price story over the last six months? Sure looks as if it was the way gasoline prices nose-dived about 80 cents from September to November. Remember all those MSM stories highlighting the plunge? Neither do I.

But let market fluctuations push prices up about fifteen cents in the last month, and you can be sure that the MSM will start bemoaning 'soaring gas prices.'

As you can see from the screen capture, the Today show was at it this morning. In fact, as Today had to admit, we currently are enjoying "the biggest oil inventory in seven years," which normally would keep prices down. If there's a culprit in this scenario, perhaps we can thank those folks at Archer Daniels Midland and their friends in Congress who have forced ethanol down our throats and gas tanks.

While CBS has its guru Michael "Clinton Rocks" O'Hanlon, ABC's "Good Morning America" today used another current hot morning pundit in New York Times columnist Thomas "In the Tank for Ethanol" Friedman. MRC's Brian Boyd noticed that when asked how Iran could punish America, Friedman grew positively giddy thinking about the whopping economic depression they could give us:

Charles Gibson: "When Iran threatens harm and pain what can they do necessarily? I mean, are they talking about restricting oil sales and cutting off oil and perhaps driving the price of oil up? Are they talking about causing more problems in Iraq for the United States, what?"