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Jewish World Review May 13, 2008 / 8 Iyar 5768 Too ‘Complex’? By Thomas Sowell http://www.JewishWorldReview.com | Some people think that the reason the public misunderstands so many issues is that these issues are too "complex" for most voters. But is that really so? With all the commotion in the media and in politics about the high price of gasoline, is there really some terribly complex explanation? Is there anything complex about the fact that with two countries— India and China— having rapid economic growth, and with combined populations 8 times that of the United States, they are creating an increased demand for the world's oil supply? The problem is not that supply and demand is such a complex explanation. The problem is that supply and demand is not an emotionally satisfying explanation. For that, you need melodrama, heroes and villains. It is clear that many people prefer to blame President Bush. Others prefer to blame the oil companies, who have long been the favorite villains of the left. Politicians understand that. Numerous times they have summoned the heads of oil companies before Congressional committees to be denounced on nationwide television for "greed," with the politicians calling for a federal investigation to "get to the bottom of this!" Now that is emotionally satisfying, which is the whole point. By the time yet another federal investigation is completed— and turns up nothing to substantiate the villainy that is supposed to be the reason for high gasoline prices— most people's attention will have turned to something else. Newspapers that carried the original inflammatory charges with banner headlines on page 1 will carry the story of the completed investigation that turned up nothing as a small item deep inside the paper. This has happened at least a dozen times over the past few decades and it will probably happen again. What about those "obscene" oil company profits we hear so much about? An economist might ask, "Obscene compared to what?" Compared to the investments made? Compared to the new investments required to find, extract and process additional oil supplies? Asking questions like these are among the many reasons why economists have never been very popular. They frustrate people's desires for emotionally satisfying explanations. If corporate "greed" is the explanation for high gasoline prices, why are the government's taxes not an even bigger sign of "greed" on the part of politicians— since taxes add more to the price of gasoline than oil company profits do? Whatever the merits or demerits of Senator John McCain's proposal to temporarily suspend the federal taxes on gasoline, it would certainly lower the price more than confiscating all the oil companies' profits. But it would not be as emotionally satisfying. Senator Barack Obama clearly understands people's emotional needs and how to meet them. He wants to raise taxes on oil companies. How that will get us more oil or lower the price of gasoline is a problem that can be left for economists to puzzle over. A politician's problem is how to get more votes— and one of the most effective ways of doing that is to be a hero who will save us from the villains. You have heard of the cavalry to the rescue. But have you ever heard of economists to the rescue? While economists are talking supply and demand, politicians are talking compassion, "change" and being on the side of the angels— and against drilling for our own oil. Has any economist ever attracted the kinds of cheering crowds that Barack Obama has— or even the crowds attracted by Hillary Clinton or John McCain? If you want cheering crowds, don't bother to study economics. It will only hold you back. Tell people what they want to hear— and they don't want to hear about supply and demand. No, supply and demand is not too "complex." It is just not very emotionally satisfying. Every weekday JewishWorldReview.com publishes what many in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here. Comment on JWR contributor Thomas Sowell's column by clicking here. Thomas Sowell Archives © 2006, Creators Syndicate

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