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lets nationalize a few refineries

M

mizzou

Diamond Member
*gets into devils advocate character*

What if the u.s. purhased and ran a few off line refineries for gasoline? We could call its products "U.S. Gas"

The crude purchased for refinement could be bought off the market at price or brought in from surpluss reserves, and then refined and sold to dealers at a set price with set profit margins ensuring operating costs are covered and minimal profit which could be spent however, maybe R&D or new infrastrucure for alternatives.

Also, only a few stations selling only u.s. gas could be open in each city, keeping local price competition in check but not over run with government business. Especially because supplies have to be limited due to the small amount of refinement capacity.

This would #1 increase competition, #2 help stimulate the economy since no new infrastructre is really necessary other then buying old stations and renovating them, #3 is minimally intrusive to the private sector....so long as the gas sold does not cease to be profitable. #4 how about paying off that big debt in the meantime.....

I dont see how opec or other producing nations would be too opposed because oil is sti bought at market price. And also it would be a good gauge for regular americans what the real cost at the pump should be.

Moat industries are already so comptetitive that the us couldnt possibly get anywhere competiting, but it seems so silly easy to make a quick buck in oil refinement for gas and it makes sense for ciizens.


This of course is assuming oil refining is where we are making very good profit margins in the grand scheme of things
 
Government owned means of production.

First time their little oil company can't compete, they'll have an automatic tax payer bailout allowing abnormal practices that would put their competition out of business.

Gets pretty expensive after that.
 
Jaskalas said:
Government owned means of production.

First time their little oil company can't compete, they'll have an automatic tax payer bailout allowing abnormal practices that would put their competition out of business.

Gets pretty expensive after that.
Click to expand...

Yes, government will be able to charge us whatever they want, and that's different from the current situation of private collusion and socialization of losses somehow.
 
Jaskalas said:
Government owned means of production.

First time their little oil company can't compete, they'll have an automatic tax payer bailout allowing abnormal practices that would put their competition out of business.

Gets pretty expensive after that.
Click to expand...

It seems like a pretty easy sell in my opinion, you dont have to advertise it. Except for maybe warning people if their business get too proftable and burden citizens then comrade sam will come looking for yoi.>=)

J/k

But anyway, i find it difficult to NOT make profit in this manner. It would only be possible if it was self sustaining and only reaped minimal profit.

I dont see the complications other then of course ideological ones
 
Good idea! Within but a few years we would have the genious of Fammie Mae, Freddie Mac, the Post Office, and let's not forget AmTrack.
 
So are the operators and maintenance staff going to be unionized government workers? Private unionized workers? Or maybe unskilled people paid minimum wage to perform the work?
 
Londo_Jowo said:
So are the operators and maintenance staff going to be unionized government workers? Private unionized workers? Or maybe unskilled people paid minimum wage to perform the work?
Click to expand...

no need to unionize workers, theres plenty of candidaes around qualified enough to be a refinery worker. Not all gov employees are unionized. I have no clue what non manual labor people do, it seems like any other factory in the industry

Obviously im not all for it but it seems like a quick way to drop a buck or two off gasoline.
 
mizzou said:
no need to unionize workers, theres plenty of candidaes around qualified enough to be a refinery worker. Not all gov employees are unionized. I have no clue what non manual labor people do, it seems like any other factory in the industry

Obviously im not all for it but it seems like a quick way to drop a buck or two off gasoline.
Click to expand...

The majority of a cost of gasoline is in the cost of crude oil. How would a govt run refinery take 25-50% off a gasoline without subsidizing it? And in the process destroying market mechanics? Subsidizing means we pay for it on the back end while fucking up the demand curve, making the problem worse.
 
Genx87 said:
The majority of a cost of gasoline is in the cost of crude oil. How would a govt run refinery take 25-50% off a gasoline without subsidizing it? And in the process destroying market mechanics? Subsidizing means we pay for it on the back end while fucking up the demand curve, making the problem worse.
Click to expand...

idea is based solely on that refineries are popping huge profits. Govnt refinery would operate on same principle, just not rape on profits. I specifically omitted subsidation as something that would not work.


Like i said, i have no realistic view other than armchair about profits on their end. Ive heard both per barrell and refined products make heavy profits.


If it turns out that nobody is making giant profts than this is a worthless venture.


Ex. We are geting f'ed with 20-40% profit margins on a commodity, gov steps in and makes 10% profit making the whole process more comptetitive
 
Common Courtesy said:
How much margin are the refineries getting?
Click to expand...

Depends on when they make their purhase, im assuming recently you can hold onto oil when bought cheaply and then sell the refined product at a higher market price when commodity prices rise.

I.e., im refining $90 barrell month old to gas but selling the final product to stations as if its the current $110 barrell

Edit: maybe youd have to nationalize an oil rig as well, uhoh 🙂
 
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mizzou said:
idea is based solely on that refineries are popping huge profits. Govnt refinery would operate on same principle, just not rape on profits. I specifically omitted subsidation as something that would not work.


Like i said, i have no realistic view other than armchair about profits on their end. Ive heard both per barrell and refined products make heavy profits.


If it turns out that nobody is making giant profts than this is a worthless venture.


Ex. We are geting f'ed with 20-40% profit margins on a commodity, gov steps in and makes 10% profit making the whole process more comptetitive
Click to expand...

Where are you getting 20-40% profit?
 
mizzou said:
Depends on when they make their purhase, im assuming recently you can hold onto oil when bought cheaply and then sell the refined product at a higher market price when commodity prices rise.

I.e., im refining $90 barrell month old to gas but selling the final product to stations as if its the current $110 barrell
Click to expand...

Sure but what are you doing with that 110\barrel price? I suspect these refineries are selling their product as fast as they can refine it.
 
Genx87 said:
Where are you getting 20-40% profit?
Click to expand...

Its an example under which this would make sense. Obviously if they really do only have like a 5% profit margin, having the gov offer a smaller competitor that operates at 2.5% profit will not do enough o lower prices.

Just throwing that out there for discussion. Playing devils advocate.
 
What is the oil reserve that the refinery has.
Days, not weeks/months.

They refine the product as soon as possible - for them to store it is a waste of resources and $$.
 
Genx87 said:
What does WWII have to do with govt taking over private industry in an attempt to reduce prices?
Click to expand...

This thread is not about any govt takeover, its about a miniscule govt venture into selling gasoline , trying to heat up some competition away from record profits at our economies expense
 
Isn't the margin on gas very small anyway? If the government really wanted to save you money they'd take over apple and it's 30% profit margin. But then douchy libtards wouldn't be able to surf on Their iPad all day.
 
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