That was a GREAT post title...

Damn, I wish I had thought of that...

I commented in your last post, but did want to add a small post of my own before moving on to other things.

You said you disagree with the claim that "security trumps profit" in my example of crude oil speculation, but you seem to agree that someone building better guidance systems for ICBMs or thermonuclear triggers for tactical warheads CAN be limited on who they sell their product to or how much they make from the sale (meaning there is only one buyer, so no opportunity to bargain the price higher).

Are you thinking that I am calling for the doing-away-with ALL profits associated with the crude oil market? Because that couldn't be further from the truth. All the Big Oil companies were making money (hand-over-fist) during the years that Reagan had the speculation curbs in place, and the profits these companies were bringing in made the investors in these companies billions in returns, simply by allowing the market's demand and supply ratios to dictate price, and not what someone thinks the price will be in 30 days. Since those curbs have been removed, we have seen two spikes where the cost of crude got so high, it actually SLOWED the biggest and most vibrant economy on the face of the earth, and helped usher in a "recession for the ages". In that time, the companies controlling those contracts saw profits for a single quarter that rivaled the GNP of many small nations, while the cost of those profits were hung on the people buying the fuel at the pumps.

I simply fail to see where you can decry the actions of someone like Chavez, who wants to manage and control every aspect of his nation's economy by removing the ability of free-market principles to dictate cost and availability... but you'll let a very small and exclusive and CLOSED group of investors dictate and manipulate market price through speculation. To me, it seems six of one and half-a-dozen of another. You are replacing a socialist government's manipulation for the manipulation of corporate interests, where the profits made are not reflected in the market price.

The risk involved in allowing this sort of practice to continue is that it is admitting an additional factor into the price equation for a commodity that our society must have, 24/7 and in a steadily growing amount. That price equation is already effected by such things as global supply, volatile markets, transportation costs and risks, production limitations... even the weather can effect the price of crude (see Katrina if you doubt). Reagan seemed to feel that the addition of speculation profits from futures projections was simply too much to risk, and he showed us that HE WAS RIGHT. History has shown us that, as well... with the evidence seen in the spikes since 2001 and the costs those spikes brought to the consumer.

Now, should the day ever come when we, as a nation, can guarantee the supply of crude that our nation needs from domestic sources, and we wish to review the case for speculation pricing, then I'll be more than happy to discuss it... but as long as we are looking at more than 1/3 of all of our daily requirements for oil coming from foreign sources, then I'd say that the government regulation of speculation pricing is just, wise and necessary.