That was also 50 years ago. Now they have cost overruns, time delays, and they bail on contracts that are unfulfilled. My unit is short planes because they simply asserted that they didn’t want to build any more after inflating the contracted price of the ones they did build by around 50%. Oh, and the kicker: they maintain proprietary control over the planes and equipment. Our guys can’t even work on the engines, they’re remove and replace. So if you have no spares, guess what? You don’t fly.
Plus, and this is the real kicker, they keep control of any and all patents, breakthroughs, and new technologies, which of course they will be happy to sell back to you. You think oil companies are thieves? Pshaw. After you subsidize Lockheed to the tune of billions, perhaps even trillions, they’ll graciously and magnanimously sell you what you already paid for at a nice markup.
Remember what Eisenhower said: “Beware of the military-industrial complex”. Truer words were never spoken.
I asked my mom today why I can’t remember cheap gas in late 2001. She has a really good memory for these sort of things, and she gave me the answer that I couldn’t remember.
While gas prices were falling for the rest of the country, the petroleum pipeline that runs through Jackson, MI was undergoing maintenance. This drove up prices in Michigan for a few months.
She remembers her brother and sisters all gloating about gas prices in their states while we were suffering.
I guess it’s time for one of us old timers to reminisce about the good old days when I used to drive into a gas station and tell the attendant after he had cleaned my windshild and checked my oil to put in a dollars worth of gas and then watch as he pumped in 5 gallons. Of course, in those days (the 1950s) I was working for the minimum wage which was $.90 an hour, so I had to work a little more than an hour to put in those 5 gallons. Nowadays, with the minimum wage going up to $6.85 in a couple of months, when gas gets to $4 a gallon I’d have to work about three hours to pay for 5 gallons. On the other hand, a pack of cigarettes in those days cost 20 cents, so the rise in gas has been less than the rise in cigarettes. And a paperback book cost 25 cents, not the $6 and $7 it costs now. My point? Inflation happens. Everything costs more. The increase in the price of gas is just a little more rapid lately, making up for all those years it wasn’t in step with inflation in other areas.
There has been massive coverage of this issue in every kind of media, and it’s one issue that’s actually getting even-handed, fairly accurage coverage across the board. To quote Pogo, we have met the enemy and he is us. Airman Doors is right – fuel prices are set by demand vs. supply. What amazes me is how anyone can still believe that the USA is the only, or even the primary, gasoline user in the world! Worldwide, there is far greater demand than ever before, and supply is not increasing fast enough to keep up. That means prices go up.
Your only solution is a longterm strategy.
I’ve just bought a house that’s a 10-15 minute walk from a metro station. (I could take a bus, but unless I’m carrying a bunch of stuff, I’d rather walk for 10 minutes than wait for the bus.) That covers getting to work AND going downtown to dinners/clubs/concerts/movies/shopping for the rest of my life.
In the non-snow months I use my motorcycle to get around. It’s a midsize (650 cc engine) so it’s as fuel efficient as a Prius while giving me astounding performance. When I’m on the expressway I drive in a moderate manner, but it’s nice being able to crank it on the onramp. With my tank- and tailbag I can throw a week’s worth of groceries for my family on there as well.
My wife is the one with the car, but she is carpooling with the Hordling as well. (Daycare is across the street from her workplace.) If necessary, she could take the metro and a bus to work, but because she commutes against the flow, she has a fairly smooth drive and is only stuck in bumper-to-bumper traffic for five minutes. For now, commuting with a kid, it’s worth the price to drive. Five years from now it may be a different story, but my wife will have an option.
We could have saved $150,000 and bought a place in the suburbs, like my brother-in-law just did. But he and his wife both work downtown, and their one-way commute is 35-65 minutes depending on traffic. Since it’s tax season, they can’t carpool – they each need a car, and need to make sure that one of them picks up their daughter from daycare.
By my calculations, if I’d done the same as them, I’d have blown the savings on the house in less than 10 years.
The thing is, we could institute a gigantic Manhattan Project style research project and spend hundreds of billions of dollars. And that project could come up with any number of alternate fuel sources that we could use instead of gasoline, that’s pretty much guaranteed.
But what we can’t do is guarantee that the alternate fuel sources will be cheaper than $4.00/gallon gasoline. If we really want cheap gasoline we’d be much better off if the government used those hundreds of billions of dollars to hand out free gas to everyone.
There are already dozens of alternative fuels, the only problem is that they are more expensive than $4.00/gallon gasoline. The government could declare that we switch over to ethanol tomorrow, or hydrogen tomorrow, or Fischer-Tropf process gassified coal, but what they can’t do is wave a magic wand and make those alternative fuels cheap, unless they directly subsidize those fuels.
That subsidizing alternative fuels to make them cheaper than $4.00/gallon gasoline is just stupid, because those subsidies have to come from somewhere, and that somewhere is your tax dollars. You’ll pay much more to drive that subsidized hydrogen car than you do to drive your gasoline car, except you’ll pay that price on April 15th instead of every time you fill up.
If you really want to encourage alternative fuels, the absolute best way is simply to slap a steep tax on gasoline. Alternative fuels that don’t have to pay the tax will be relatively cheaper. The only trouble with this approach is that in Europe they already have very steep gas taxes, and no widespread alternative fuel has emerged, instead people drive much less and drive more efficient conventional vehicles (like, say, scooters).
Massive subsidies for transportation don’t make sense, and you can’t invent cheap alternative fuel by throwing money at the problem, you can only create expensive alternative fuel. Maybe for public policy reasons we want to use that expensive alternative fuel, but we shouldn’t pretend it’s going to be cheaper than gasoline. There’s a reason everyone drives gasoline cars, and that’s because gasoline is the cheapest fuel source. Even at $4.00/gallon.
There was an interesting report on National Public Radio tonight on the price of gasoline. One part was a rebuttal from some people regarding Bush’s statement that high gas prices was because Congress has not allowed drilling in ANWAR or construction of new refining plants. (Although new refineries have not been built lately, existing ones have been expanded.)
The analyst gave the opinion that supply and demand has not impacted prices that much (an opinion I suspect somewhat). What was interesting was the statement that a large part of the increase appears to be the result of speculators and oil futures. People who do not actually buy oil to use but instead as an investment. It is an interesting theory.
I have a philosophical problem with that. Assuming your intent is to avoid natural (market driven) high gas prices, what is the logic behind increasing the price artificially?
To avoid paying $5/gal, you increase the taxes so that you pay $5/gal?
And who benefits from the tax money? Isn’t this just an excuse to transfer more money from consumers to politicians, who, as we all know, have our “best interests” at heart? “No, you can’t give your money to the oil companies or whomever you wish, you have to give it to us so we can spend it for you.”
I think the idea is that instead of $20/gal prices 10 years from now, you take the hit now and have alternative fuel sources in place 20 10 years from now because it’s profitable to invest in that technology.