Integrity Matters
December 7, 2005
Oil firms face questions for high gas
prices
Question: (E-211)
Dear Jim:
Do you think recent outlandish gasoline prices reflect
integrity in the oil business? What is legitimate profit?
Response:
Price-gouging is destructive. Legitimate profit is
what responsible business people and their honest customers
determine is a fair price. Integrity-centered buyers
and sellers are willing to protect the longer-term viability
of the other. Either too much or too little profit causes
hardships. It's wrong to prey upon those who find themselves
in harm's way. Medical service providers would not raise
prices during an epidemic. Society would never stand
for that.
Supply-and-demand explanations about high-priced fuels
are followed by the blame game, otherwise known as "we
are victims, too," with the fault lying at the feet
of those in the Middle East who control prices. A good
number of Americans are hopping mad about the high fuel
costs and have demanded the oil companies be investigated
after their industry-wide recent quarterly reports of
incredible profit-taking.
Congress has begun hearings regarding the recent price
run-ups and will determine who is guilty of what. Tens
of millions of drivers concluded that the oil barons
wanted to charge "whatever the market would bear" -
and they did. Powerful people, sitting in lofty places,
were reporting tremendous profits, creating burdensome
fuel costs for the masses. One of the phrases emphasizing
the integrity-centered leadership message of the Bracher
Center for Integrity in Leadership: It should be common
knowledge that free markets must operate with integrity,
a culture of compliance, or face increasing government
oversight.
According to MSNBC on Sept. 22, "The United States
Federal Trade Commission is investigating whether gasoline
price profiteering has occurred and oil companies have
constrained refinery capacity to manipulate fuel prices."
On Sept. 5, just after Hurricane Katrina devastated
parts of Louisiana, Mississippi and Alabama, The Shreveport
(La.) Times, editorialized: "Business is business,
but with Louisiana in a state of emergency from Hurricane
Katrina, gasoline price gouging isn't just illegal, it's
unconscionable. Gas stations are entitled to a reasonable
profit. As wholesale prices rise, the cost has to be
passed along to the motorist. ... But in one case prices
had jumped past $4 overnight. In other instances, prices
were rising several times within one day."
The attorney general of each state welcomes complaints
about price gouging, of any kind, and now, especially fuel.
Please report crooked treatment, immediately, because integrity
is the foundation for legitimate profits and a healthy
business climate.
