One of the more ludicrous spectacles of the last week was the interrogation of oil company chiefs by the greedy, spendthrift and economically illiterate demagogues currently disgracing this Congress.

Reasons Shikha Dalmia hits back here:

In a market economy, price is set by supply and demand, not wishful thinking. The price of oil has gone up because of growing demand from emerging economies like India and China and disruptions in supply due to natural disasters in North America and political instability in Latin America and Iraq. If we could collude to raise oil prices whenever we pleased, why didn’t we do so last year when prices at the pump dropped to nearly a dollar a gallon? Moreover, why would the inflation-adjusted price of gas still be no higher than what it was a decade ago? But if you are going to threaten us with additional taxes when we post profits, in the interest of fairness, shouldn’t you also give us tax refunds when we suffer losses? Our refiners posted losses of more than $1 billion in 2002. Should they expect a retroactive refund? Will you shield us if an alternative fuel source threatens to put us out of business? No business can afford to take market risk if it can’t reap commensurate rewards. The term “windfall profits” implies unearned, ill-gotten gains. We earn our profits by producing something of value for our consumers. True windfalls are the budget surpluses that flow into the government’s cofferswithout your having to lift a fingerwhen industries like ours become more productive. Since some of you are trying to persuade the public by promising to rebate our profits to consumers, perhaps you should also agree to return the next Federal surplus directly to the taxpayers (on the off chance that you ever run a surplus again).