01/23/2012
Last Wednesday, Jan. 18,
newspapers reported Energy Secretary Jose Rene Almendras as saying that
government “cannot control” and has “no right to dictate oil prices
because that would be tantamount to regulation,” which he argues is
“against the law.”
If that were true, then why do we have an
energy department at all? The oil companies can have absolute rein on
the market, and we can remove all the playacting that government is
still there to keep them in check.
The reality is, a Department of
Energy (DoE) does exist. It is supposed to be implementing what
Almendras mouths as “the law,” which, in plain English, is simply
regulation. Government is supposed to regulate by putting up protective
measures to help Filipino families and the nation’s economy from
suffering economic collapse.
However, Almendras is doing the
opposite. By championing deregulation, he wants to ensure that our
people continue to remain defenseless against the predatory pricing and
market manipulation of transnational oil corporations in cahoots with
the local oligarchs.
What is the “market” that Almendras invokes?
You will find a thousand ways of defining it, such as from Economy
Watch, which says, “a market is an environment that allows buyers and
sellers to trade or exchange goods, services and information. These
interactions define demand and supply characteristics;” or from
Wikipedia, which defines it as “one of many varieties of systems,
institutions, procedures, social relations and infrastructures whereby
parties engage in exchange.”
Is this like my baker preparing pan
de sal that I later buy — end of story? If it were that simple, then
there should have been no market chaos in the “deregulated” world
economy of the past 20 years that was brought in by the US-UN-promoted
free trade and globalization.
If “deregulation” were that great,
then why is it that the “regulated” economy of China, with its
controlled yuan and state-led system, is doing better than all the rest?
Moreover,
is the oil sector of China deregulated? For that matter, is the US oil
sector really deregulated? These two countries maintain secret oil
stockpiles that extend far into the future to ensure their fuel
security.
On June 24, 2011, it was reported in US media that the
“US releases oil from stockpiles to aid economy,” spurred by the “Obama
administration’s decision… to release 30 million barrels of oil from…
emergency stockpiles… designed to bolster the economy and soothe
consumers’ concerns amid political unrest in Libya and the Middle East…
(which) move coincided with a similar 30 million-barrel release by other
International Energy Agency (IEA) member countries… (sending) oil
prices to a four-month low in trading…”
Is this an action that
characterizes regulation or deregulation? What is clear is that the US
government and the IEA do intervene to “bolster the economy… soothe
consumers’ concerns… (and send) oil prices to a four-month low…” Now,
isn’t that regulation?
Free market apologists will argue that
“intervention” is not “regulation;” but intervention is certainly not
“deregulation,” at least in the sense that Almendras uses it — that is,
never to touch the free market play of oil.
This certainly brings
us back to the proposal I have put forward for years now, which is for
the Philippines to have a 12-month oil or fuel stockpile bought with
excess foreign exchange in the Bangko Sentral ng Pilipinas (BSP) and
some in US bonds in the US Treasury, or part of the Special Deposit
Account sleeping in the BSP vaults. A solon or two had echoed this same
idea; but they were immediately rebuked by Platts oil consultancy, whose
“expert,” ironically named Montespeque opined that stockpiling would
only raise oil prices and hurt the Philippines.
And so we ask: Are
China and the US hurting themselves by stockpiling oil? Wasn’t that
June 24, 2011 release by Obama and the IEA of some of this stockpile
timed to send “oil prices to a four-month low?”
There are very
many forces that actually intervene in the “deregulated” oil market,
influencing and turning it to their advantage. Commodities traders buy,
sell and resell oil futures while big traders consciously and
deliberately influence market prices through their bet placements,
pushing up oil prices in cahoots with other players (e.g., global media
giants and politicians of the major powers, who create events for the
benefit of their finance and oil principals — the major contributors to
their political campaigns).
Imagine sheep herders and sheep dogs
with tags on them, like “oil giants,” “market speculators,” “oil
traders,” “business media wires,” “business cable news,” “US president,”
“Israel,” acting in unison, herding the sheep (aka the market) this and
that way.
Since late last year up to now, the oil market has been
attributing its volatility to the US-Israel vs Iran et al. scenario.
Yet there was nary a note from BSA III and Almendras in all that time
save for their sudden announcement of ”rationing” oil once a crisis
erupts. Aside from this, the Palace has only one other measure, the
“Pantawid Pasada,” which one newspaper headlined, “Pantawid Pasada card
is free — DoE.”
Well, the measly P300 may be free for the drivers
who receive it but it should be made clear that government is budgeting
and paying the oil companies for the oil that drivers draw from the
cards. It is therefore really not a subsidy for public utility vehicle
(PUV) drivers but for the oil companies. And if government cuts the
excise tax allegedly to help the public, that is still no help at all as
it cuts government revenues, which will then have to be raised
somewhere else. It is only the oil companies that win in every one of
these scenarios.
BS Aquino III, Almendras, and the DoE are all
useless and inutile. They are actually the greatest obstacle to
reestablishing a people and economy-friendly oil sector, as well as a
regime of people-oriented re-regulation that seeks to dismantle an
oligarch-enriching “deregulated regulation.”
(Tune in to 1098AM,
dwAD, Sulo ng Pilipino/Radyo OpinYon, Monday to Friday, 5 to 6 p.m.;
watch Destiny Cable GNN’s HTL edition of Talk News TV, Saturdays, 8:15
to 9 p.m., with replay at 11:15 p.m., on “Hocus PCOS used two software;”
visit http://newkatipunero.blogspot.com for our articles plus TV and
radio archives)
(Reprinted with permission from Mr. Herman Tiu-Laurel)
Source: The Daily Tribune
URL:
http://www.tribuneonline.org/commentary/20120123com5.html
