From Dan Ferris in the S&A Digest:

We've written a lot about how new drilling technologies have led to a boom in U.S. natural gas supplies… and how the flood of resources is transforming the domestic energy and manufacturing sectors. This trend is at the heart of what I've termed the "American Industrial Renaissance."

In short, the new technologies have allowed industry to extract gas from shale rock formations. And the U.S. has huge gas deposits in shales. The Marcellus shale alone is half the size of Spain. And it sits between two other large shale formations, the Utica shale and the Upper Devonian shale play – neither of which have been explored much.

... In addition to vast new natural gas deposits, massive new oil resources are also being exploited all over the North American continent. Thanks to the oil-rich Bakken shale within its borders, North Dakota is on pace to produce about as much oil as Ecuador, a member of the OPEC oil cartel. The Eagle Ford shale in south Texas is shaping to become the largest oil find in U.S. history. We already produce so much oil in the U.S. that we've started exporting the stuff. It's only a matter of time before big new supplies reduce the price of oil and gasoline.

But Congress knows nothing of the marketplace. It deals in politics only, not economic fact. So six Democrats from the House of Representatives have proposed a new "Reasonable Profits Board," which would apply a windfall-profits tax as high as 100% on oil and gasoline profits. Naturally, the proposal contains no indication of what would constitute a "reasonable" profit. This issue has been in the air for most of my life. I was born in 1961 and vividly remember sitting in lines at the gas station in the morning on my way to school, when gasoline was rationed.

You HAVE to be a politician to be this stupid. Selling gasoline is one of the crappiest, lowest-margin businesses around. If you don't attach a convenience store to it, it's generally not worth doing.

And refining oil isn't much better… I just looked up a couple of refining stocks. Tesoro made losses three times in 10 years and reported net margins of less than 2% three times. Valero really knocked the cover off the ball with only two losing years out of 10 and three years of sub-2% net margins. And when they're firing on all cylinders, net margins rose to more than 5% once at Valero (in 2006) and more than 4% once at Tesoro (also 2006). I never recommend refiners in my newsletters for the same reason I don't recommend airlines. They're just not profitable on a consistent basis.

But Congress says they're making too much money. If the legislators wanted to guarantee a reasonable profit from selling oil and gasoline, they wouldn't tax it. They'd subsidize it. Instead, they're running around trying to get votes by putting refineries and gasoline stations out of business, claiming they make too much money.

What about people who lend out your bank deposits (10 times over) and forbid Wal-Mart from entering their business because the retailer's model would only benefit customers, not cronies? Are they making too much money?

What about people who get protection and money from the government to keep the national price of sugar double the global price? Are they making too much money?

What about people who get money from the government to grow corn so they can do the most expensive possible thing with it – turn it into ethanol? Are they making too much money?

None of those people are making too much money because Komrade Obama and his ilk love them. But people who sell gasoline… one of the skinniest margins on Earth… a product without which life as we know it comes to a grinding halt… they're making too much money.

The politicians are only doing what any rational person expects of them. They're trying to make good sound bites for the voting masses, as if the political process had all the depth and meaning of a Disney movie trailer. "Coming soon: Hope, Change, and Reasonable Profits!"

More government stupidity:

Unbelievable: Sen. Rand Paul detained today by TSA

Top banking insider BLASTS Federal Reserve... Calls for new gold standard

"Reasonable Profits Board": Congress is now pushing for another incredibly stupid law