So gas prices are spiking, because demand is outstripping supply. And these two rocket scientists think that cutting the price of gas is going to improve this situation…how? It’s going to increase demand and exacerbate the problem.
Senator Clinton gets extra stupid points for wanting to pay for this by putting windfall taxes on the oil companies. So in addition to stimulating demand, she advocates a policy that would inhibit production as well. Less supply, more demand. Won’t that be fun?
Obama’s the only one with his head screwed on straight over this issue.
Unfortunately for him, this is America, where it would seem that well over half the population is unable to reason. He’d do well running for office in Europe though.
Sorry, but I’m with Clinton on this. People need vehicles to get to work and to do their jobs. The price of fuel significantly impacts the profitability of that. Ever heard the phrase, “I can’t afford to take that job?” By lessenning the tax burden before you start to make a profit, more people should make more profit, on which they can then be taxed.
Do you actually think that suspending the federal tax is going to drive down the price of gas?
The oil companies will increase their prices by 18.4 cents a gallon over the summer during the suspension and then once the tax is re-applied, gas prices will be even higher than they would be if the tax had not been suspended.
The phrase “I can’t afford to take that job” is usually code for “I can’t afford to own a really spiffy gas guzzler and drive it round trip with only myself as the occupant on the paycheck that job would earn.”
Yes, some - perhaps many - people need vehicles to get to work, but it doesn’t have to be a vehicle they own and drive all by their lonesome. It could be a carpool or public transportation. Walking and biking to work, where possible throws in the added benefit of healthy exercise and no gasoline costs at all.
In this situation, our demand is a lot more flexible than we like to pretend.
Public transportation? Hahahahaha! Unless you live in a major metropolitan area, and work in the same area, it’s often if not usually not an option. Ditto carpooling: if you’re a goodly distance from the workplace, there’s a goodly chance that there’s nobody nearby. And a 20 mile walk or bike ride simply isn’t on.
Let the government tax you on the money you make, not tax you such that you can’t make money in the first place.
bullshit. Have you even looked into carpooling? I live in rural Kitsap County here in the northwest and vanpool into work everyday in downtown Seattle. I know lots of people who do this–but you have to research it. Your answer is a cop-out.
This is complete nonsense. Unless you live in the boonies, and work in a different boony, chances are exceedingly high that someone who lives in your general area also works in the general area where you work. At a minimum someone who lives on your way to work probably works near where you work, and would split the cost of gas with you.
The problem is that our society hasn’t embraced the idea of carpooling, so there are no resources to tap into. Obama should propose a national carpool database. Enter your starting zipcode, ending zipcode, work schedule, and get a list of people who would be good candidates to carpool with. Add some suggestions on how to run a workable carpool, advertise it, and people will start using it.
The very LAST thing we need to do is to encourage demand, we need to encourage reducing demand.
What has changed, unfortunately, is the privatisation (and then semi-nationalisation) of the rail network over the past 15 years. When I changed jobs at the end of last summer, I looked into commuting the 80 mile trip by train whilst I moved house, thinking that even if it might be expensive it would at least be relatively relaxing. I did it twice - each time the journey took over 4 hours each way and cost me close to $100 as you have to use different train companies operating entirely separate timetables. Of course, at each end I also needed to either drive and pay to park or get a taxi - increasing cost and time further.
By car I could do it in 2 hours door to door at about $35 a round trip (even with our petrol prices of something like $10 a gallon). Nobody else was likely to be driving from Somerset to Worcestershire every day!
For small stations now, you’re lucky if 3 trains stop a day, though countless whizz by trying to make up time lost so they aren’t penalised by the Govt.
Not justifying what **Quartz **said, but your view is just a tad outdated!
Yeah, there isn’t much economic sense in what they are proposing, and it looks like election year pandering. It would, however, make sense to have a debate about what the proper tax rate on gasoline and petroleum should be as it is unlikely that we are currently at precisely the correct level.
Let’s not forget that this is yet another thing the president can’t actually do-- Congress would have to vote on this, and I can’t see it passing. I wish these folks would stick to things that the president has authority over and not pretend like they can rule by edict.
Clinton and McCain are helping the common man whereas Obama the renowned elitist is hurting the common man in the pocket as he has no understanding or empathy with them…
Doesn’t that depend, in part, on the price elasticity? Gasoline is a fairly inelastic resource, so getting rid of the excise tax might not increase demand enough to cause a price rise to make up the difference…even with increased demand, the final price might be cheaper than it is now with the tax.
Besides, to play devils advocate, the excise tax is an artificial constraint on demand imposed by the government anyway, so all getting rid of it will do will be to get rid of a distortion shift the supply/demand curve closer to what it would be if it were a truly free market.
