Daily Archives: 24 April 2025

Two Responses

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The headline tells the tale.

California is winning the war on ‘Big Oil,’ but experts say victory will bring higher gas prices

California’s “victory” has resulted in this:

Valero Energy Corporation has announced it will idle or close its Benicia Refinery in California—just the latest in the exodus of fossil fuel companies from the state.
Six months ago, Phillips 66 announced the closure of its Los Angeles-area refinery by the end of this year—it’s since bumped the date up to October—and a few months before that, Chevron announced it would be moving its headquarters from San Ramon, California, to Houston.
After the two refineries close, it’s not clear exactly where California will find more gasoline and other finished petroleum products, such as jet fuel, to satisfy demand.

And this:

Newsom blamed oil companies for high gasoline prices and promised further regulation of the industry would solve the problem for residents.

Here are two responses, should the management teams of the companies involved (finally) find the backbone to implement them. One is for oil and natural gas companies outside California decline to sell any of their products into California. They easily can make the case that it’s not sound economically or business-wise to produce products that meet California’s enormously stringent requirements and still be able to sell into the rest of our nation at market prices.

The other is for car and truck companies to decline to sell their vehicles into California. They easily can make the same economic and business argument: it’s not feasible to produce vehicles solely for the California market, and making those California-compliant vehicles for nation-wide sales only drives the costs of those vehicles far above the market prices that otherwise would obtain.

Those moves also would satisfactorily answer Newsom’s problem. With no further oil and gas flowing into California from outside, there would be no gasoline for which to abuse gasoline prices. With no further vehicles being sold into California, there would be reduced demand for gasoline at any price, a demand that would fall to zero as existing ICE vehicles age out.

Winners all around.

A Sort of Start on a Student Loan Fix

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Department of Education Secretary Linda McMahon has proposed a series of steps to correct our nation’s student loan miasma.

• mov[e] roughly 1.8 million borrowers into repayment plans and restart collections of loans in default
• in some cases wages would be automatically garnished
• push colleges to be responsible and transparent

That last is especially curious. McMahon does not say how she defines “responsible and transparent,” nor does she say what constitutes her “push,” how hard she will push, or what consequences—concrete, measurable, and publicly accessible—she will apply for noncompliance, or how promptly.

These steps need to be taken, but by themselves they can be only stopgap, and they are wholly inadequate. What’s really necessary is to get the Federal government completely out of the student loan business: no Federal student loan guarantees, no Federal student loan-supporting programs whatsoever.

Because money is fungible, that must include drastically curtailing the range of student grants and scholarships originating from Federal programs. The same reasoning for getting rid of DoEd altogether applies to any sort of Federal involvement in education.

McMahon can do these things from within DoED while she’s setting the stage for Congress’ elimination of the Department (note: not merely defunding the department; eliminate it altogether). However, for the complete solution, Congress needs to act:

• statutorily require colleges and universities to publish the average, median, and range of income at the five years employment mark for their graduates in each of the major fields offered
• statutorily require student loans to be originated by private lenders or colleges and universities
• statutorily require colleges and universities to guarantee at least 50% of each loan granted their students
• statutorily allow current and future student loans to be discharged in “ordinary” bankruptcy proceedings

Only when private lenders and colleges and universities are the only ones with skin in this student loan game will those loans and their borrowers be carefully screened for repayment risk. That will prove optimal for the student borrowers and for us taxpayers.