In regards to the economic analysis of sociology professors Forest and Harry, I still don’t get it.

Harry’s March 1 letter describes the coalition’s victory as one in which “businessmen profit,” raises the shibboleth of “blood for oil,” and criticizes Republicans for “dismantling a working energy policy.”

Economic theory suggests producers profit by restricting output and raising prices. The Organization of Petroleum Exporting Countries is an attempt to accomplish those goals.

Oil producers would profit if the organization had the ability to punish price cutters. Iraq’s invasion of Kuwait would be an extreme case of punishment.

But Harry does not accuse American oil producers of encouraging that invasion.

Oil producers also would profit if consumers went along with the output restrictions rather than shop around for more oil at lower prices.

Mandatory rationing and allocation of oil supplies would put the considerable U.S. police power to work restricting output and sharing markets.

But Harry does not offer evidence of support among businessmen for mandatory rationing in his letter.

Voluntary conservation measures also would help the oil producers profit, because the remaining demand would be less price-elastic, and the producers would be more able to raise prices.

Let’s look at how Republicans “dismantled” that “working energy policy.” Harry may have forgotten the gas lines and spot shortages that plagued people during the 1970s.

There were no gas lines after Jan. 28, 1981, the day President Reagan removed federal controls on crude oil prices.

The real prices of crude oil and gasoline began falling in mid-1981 and continued to fall until August, 1990. During the 1980s, the Texas oil patch endured tough times and business failures.

The Republicans’ energy policy actually reduced the pressure on poor people’s budgets as it increased competitive pressure on businessmen.

Prices of crude oil for future delivery began falling after Bush sent troops to the Gulf. I predict they will continue to fall, as Iraq and Kuwait resume oil production.

They should stay low for some time unless some other oil country decides to express a “legitimate complaint” against a price cutting neighbor.

I regret the budget situation does not allow the economics department to offer more classes. We can do a better job of explaining energy economics to sociology majors than their professors are.

Stephen H. Karlson

Associate Professor

Economics