Friday, October 28, 2005

Pinocchio's Nose

So I'm watching GMA this morning while doing my back exercises. Charlie Gibson is grilling Mellody Hobson, the show's economics troglodyte, about the huge profits the oil companies have been reporting and the high price of energy. It was a particularly delicious moment where the lines between news and an SNL parody of news were hilariously blurred. Hobson's dropping her economics 101 textbook bon mots, such as:

This is a free enterprise system in a global market and the big oil companies
themselves simply don't have a hand in setting the price of oil or its
derivative, gasoline.

We have to remember: this is not charity, it's business.

Now that big oil has these record-breaking profits, they have an incentive to put more money into drilling and refining.

This is one situation where (the public is) at the whim of the markets...

Of course, none of this has even the slightest basis in reality. The history of the oil industry is the history of ruthless restraint of trade, price fixing, and cartelization of the most important commodity in industrial economies. (This is most comprehensively chronicled in Daniel Yergin's Pulitzer Prize Winner, The Prize.)

But the ridiculousness of Hobson's claims wasn't the funny part (though their social Darwinistic leanings did shed light on the favorite quote listed on Hobson's bio "Kill and drive on.") The funny part was that, while Hobson was talking, GMA had a counter in the bottom left of the screen, keeping track of the profits Exxon was making WHILE Hobson was talking. In the two minutes she spoke, Exxon made another $150K in profit!

It was like watching Pinocchio's nose grow!


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