Oh No! Gas Prices Are Falling!
Every time the price of oil drops, the demand for that same product increases and the demand for alternate fuels, decreases. Why are gas prices falling?
China Daily reported that “oil dropped more than 6 percent to below $88.00 a barrel on Monday as a global market rout churned concerns that faltering fuel demand could slow further.”
In other words, we aren’t buying enough, so it’s time to lower the price. But can anyone other than the people vested in that market honestly say that we don’t use enough oil?
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In his new book “Hot, Flat, and Crowded”, Thomas L. Friedman writes “When I asked Rick Wagoner, the chairman and CEO of General Motors, why his company didn’t make more fuel-efficient cars, he gave me the standard answer: that GM has never succeeded in telling Americans what cars they should buy.” Thomas goes on to say , “But what the Detroit executives never tell you is that one big reason the public wanted SUVs and Hummers all those years was that Detroit and the oil industry constantly lobbied Congress against raising gasoline taxes, which would have shaped public demand for something different.”
European countries have been imposing high gasoline taxes for years, and when I was serving in Germany in the early 90’s, a gallon of gas was $6.84 a gallon, and that was 20 years ago! The result is that European countries have demanded smaller and smaller cars.
As of this writing, Gasoline in Denmark is about $9.00 a gallon, compared to $3.65 in the United States. (Up from $2.50 a year ago and down from $4.50 two months ago.) It seems like $9.00 a gallon gas in Denmark would decimate it’s economy right? Since 1981, there economy has grown 70 percent while energy consumption has been flat. In 1973, Denmark got 99 percent of it’s energy from the Middle East. Today, it gets zero.
We’ve become spoiled in the United States. We have grown up thinking that the oil that runs everything from our cars to our industrial complex, is cheap, inexhaustible and politically neutral. But we have come to an age where we realize that oil is in short supply, expensive, environmentally damaging and a political nightmare.
So with these realizations, instead of following the success of countries like Denmark, Brazil and Germany, we continue to lower the price, to fuel the demand, to use more of what we are running out of.
The Republican saying “Drill more, use less” doesn’t work. If we want more of the same Environmental devastation, financial crisis, repeated bailouts, and political situations like wars, terrorism and starvation, then all we have to do is…nothing.
I say it’s time to raise the price of Gasoline in this country. It’s time to drive this economy toward a sustainable energy program that will benefit our economy, our lives and our environment.
Photo courtesy of WiseOwl via Creative Commons License
Oh cool, can we have even MORE corn used for biofuels and drive up food shortages? Please?
Someone I think has stock in the biofuel industry.
What Wal Mart is doing to society is…allowing a lot of people below or near the poverty line to live much better lives by significantly increasing the purchasing power they have with their limited dollars.
I understand antipathy to Wal Mart, it is a company that pits the interests of the poor against the interests of unions, and in that conflict many will choose unions for political reasons (they contribute a lot more money than the poor do). But the simple fact is that Wal Mart does more for the poor than any government program ever has or ever could.
Excuse me, but what a crock! Our petroleum-based economy has led to the great prosperity that we (in the industrialized world) have enjoyed fo some time now. The rest of the world would like to partake of the same prosperity. But, the Malthusians and and “Progressives” would condemn them to remaining in their Third-World poverty (to “Save the Planet!”) Really, it amazes me when leftists constantly tell us we need to emulate Europe, when their economies lag way behind ours; their unemployment is consistently higher; and the ethnic powder keg they smugly call America is their own reality. Sorry, I’m having none of it!
A very good case has been made that “fossil fuels” are not in fact a result of the organic breakdown of living organisms but are the result of thermodynamic chemical reactions formed under intense heat and pressure deep within the earth’s crust and escape via the centrifugal forces of the earth’s rotation. When you look at some of the deep well drilling at depths up to 30,000 feet this starts to make sense. Thus they are constantly being produced and are virtually inexhaustable. The “devastation of the environment” only occurs in third world countries where there is no oversight, it hasn’t happened in the US since the blowout off Santa Barbara and the Exxon Valdez. We drill in the Gulf of Mexico and you don’t see the coasts of LA, TX or Mississippi all covered in oil. Drill here, Drill Now!
High gas prices lower home prices out in the suburbs.
Why would we want home prices to drop?
I like to pass gas.
It’s about $8/gallon here in Japan. In provincial Japan, bus and train schedules are so crappy everyone drives; in Tokyo, it depends. Head out into the suburbs and many people have cars, and not all the 660cc “keijidousha” either. Japan is dense, so people can afford $8 gas, because they don’t have to drive 30+ minutes to reach a grocery store, visit the library, or buy gas, like some North Americans I know.
In Tokyo I commute by crowded train–elbows in my ear, struggle to get in the train car, blessed to be taller than the average Japanese–for an hour, one-way. It sucks, but my employer pays my commuting fee, which makes it suck less, because I’d otherwise pay about $8-9 every day to go to and from work.
I’ve read one reason rail in the US hasn’t largely replaced semis for freight (or, why semis replaced rail) is that (union-forced, government-forced?) railroad pension costs have jacked up the cost of sending stuff by rail to the point where semis are cheaper (depending on final destination, etc.). Rant all you like against “dumb Americans and their semis,” but economics is at work.
I say it’s time to call anyone who wants to raise taxes in the middle of a financial panic a Marxist.
So let me get this straight– Denmark gets zero oil from the Middle East because gas is nine dollars a gallon there? Of course! How could we be so dumb!
Thomas Friedman is married to a millionaire, lives in a huge mansion, and gets all of his travel expenses paid for by his employer. And he wants to tell others to live frugally. Let him find a job in Des Moines for 35,000/year and his opinion might mean something.
anyone who agrees with this asshole should be neutered. the united states can not afford to raises gas up to $9.00 a gallon. there are too many poor people that this would destroy there lives. what we need to do is come up with a viable cheap energy source. you can tell this guy is a yuppy pinko facist with his walmart comment. oh adam guess what i drive a 1990 cadillac with a nice 4.5L V8. next time i go out im gonna give her a WOT just for you. burn up a couple gallons just going just a few blocks.