Telling the truth on gas prices
Thomas Friedman of the NY Times takes on, what he considers, the truth regarding gas prices, in light of the presidential candidates' disagreement on the gas-tax holiday. What would a truthful presidential candidate tell the nation, according to Friedman?
- There is no short-term fix for gas prices. Supply is what it is and is increasing all over the world, including in India and China.
- The gas-tax holiday would only make it worse.
- The answer is to go the other way, "guarantee people a high gas price, forever," via a "price floor." The candidate brave enough to say this would add that $4 gas is really starting to impact driving behavior and car choices.
- The message would be clear, according to Friedman: The price of gas is never going back down. So get used to it.
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Reader Comments (Page 1 of 1)
5-29-2008 @ 6:52PM
Kamal said...
Simple laws of supply and demand, and how prices are related.
World oil supply is dwindling (temp. surge in oil production by OPEC does not count). When supply goes down and demand does not, prices go up.
To keep prices the same demand must match supply. With more countries becoming industrialized, people in those countries can now buy a car or two where before they could not afford it. Bottom line, demand is not going down. Therefore, gas prices will continue to go up. QED.
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5-29-2008 @ 8:19PM
dex said...
i too believe that prices will go up. However, for arguement's sake. If petrol cars started to become regulated in terms of consumption alike CFCs in air conditionings used in the cars. Heavy transport vehicles eg. trucks and buses, started to use hydrocell technology instead of running totally on petrol for fuel. wouldn't that reduce demand?
when choices of fuel has competition with a substantiable alternative that is sustainable to the environment + it has financial and lifestyle benefits to the end user. Petrol will start struggling..
we have the technology! we need to be able to afford it, then we need to use it.
but then how many of us can put our money where our mouths are and go buy an eco car?
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