Last week saw another sad grandstanding display by our elected politicians. Trying to respond to the public clamor over high gas prices, the Senate dragged in executives from five major oil companies to demand answers. These hearings demonstrate a disturbing trend in our polity.
The underlying premise of the entire hearings misconceives the role of corporate employees, like CEO. Simply put, the Senators are calling these executives to task for doing their jobs. Consider the following questions- What exactly should these execs have done in the face of a rise in demand for their product? Do you realize that these people have jobs appointed by the board of directors with the purpose of enhancing shareholder value? Should they have charged less than the market rate (market rate= rate that they could obtain from the market) just because it is in the interests of some Americans? In fact, if oil executives failed to raise gas prices, their board of directors should fire them on the spot, and the company’s shareholders should sue them for breach of fiduciary duty.
If the government wants to subsidize people in their consumption of gas, they should give out a tax break or hand out a voucher for gas. This would be horrible and near-socialist, but it is miles better than calling in private businessmen who are violating no law and doing their jobs, and demanding that they sacrifice the interests of their employers for the sake of the so-called “public interest.”