Failure!


Great discussion, I even made all my points. But I lost the argument
I had an interesting conversation a couple of days ago. A friend started in on how the oil companies are profiteering. Aha! I thought. What a great opportunity to show the failures of government!

I had the figures.

I pointed out that the oil companies only average 9.8 cents profit per dollar of sales, which is low compared to most multinationals. Micro$oft does better than 33 cents per dollar of sales.

I pointed out that the FedGovs get in taxes from the oil companies more than two and a half times what the oil companies take in profits, with the State tax take even higher.

I pointed out that in direct at-the-pump taxes, the Federal taxes are 18.4 cents per gallon of gas while the oil company profits on that same gallon are 13 cents. That is before State and local taxes that drive the price even higher.

I pointed out that government mandated prices only create shortages and raise prices (also here).

I pointed out that we have less refinery capacity, no one wants any more built near them, and different states have different formulas for summer gas.

I pointed out that ethanol incentives are driving corn prices up, causing higher prices for nearly every food and causing food shortages in developing nations.

I pointed out that all the Senate talk about excessive profits was more about extorting more money and demonizing the oil companies.

I pointed out that in many states, gas stations are prohibited by law from underselling their competition.

But you have to have government, I was told.

Why? I asked.

Because otherwise the oil companies would raise prices!

I asked how many times in the last year they had shopped at WalMart.

What do you mean? they asked.

One of the best ways of capturing market share is by selling the same (or a similar) product at a lower price, Price isn't the only factor, that is why you can have WalMart and True Value in the same market. If one oil company raised their prices, the other oil companies would lower theirs to capture more of the market.

But you have to have the government to enforce standards! I was told.

Did the government set the standards on DVDs? I asked. DVD standards are enforced without government regulation BECAUSE people don't want to have to worry about if the DVD they picked up yesterday will work in their player.

But government keeps oil companies from putting stuff in our gas! they said.

A company's reputation is almost as important as the product or service they sell, especially if they want your repeat business. Back when those few bottles of Tylenol were poisoned, all the bottles were recalled because the company wanted to build trust again. The new bottles came out with the tamperproof seals. That was far more than the company was required to do by the government, yet it was just what the customers expected. A company can't afford to mess with it's reputation.

So with all that, you would think that I had calmly made my point, right?

No such luck.

They said I was logical, but you still needed government.

Here was this intelligent person, warm, caring, civic minded, and they had been brainwashed into believing that government looked out for their best interests.

I could trot out all the logic I wanted. I could "win" every single point. But I wouldn't convince them.

They didn't want to think about a nation with a smaller government, even if it was in their own best interests to do so.

I failed to convince them because logic and reason wouldn't reach them where they lived. Long, slow conditioning over generations had taught them to trust their government and what it's leaders said.

Reasoning can not bridge that gap. It was too much to ask without a catastrophic failure.

I am going to think about the implications some.

— NeoWayland

Posted: Sun - June 24, 2007 at 01:21 PM  Tag


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