March 17, 2012

Impose Price Controls On Gas?

Daily there seems to be an increase in the clamor for government to impose price controls on gasoline. The rational is that oil based products are almost as essential as food to live. We use cars to get back and forth to work and shop for daily essentials. We also use petroleum to heat our homes and cook.

Price controls did not work in the 1970’s and they will not work now. President Obama indicated the United States had 2% of the world’s oil reserves and we consume 20% of the world’s production of petroleum products. If we controlled prices, the result would be less supply of oil delivered to the United States and long lines at the gas pumps. The oil companies will be able to get better prices for their products elsewhere.

The industry is an oligopoly and I am in favor of enforcing anti-trust laws against it; however, price controls are not the way to go.

The argument to impose price controls on gas is no different than supporting wage controls on teachers because education is getting too expensive and it is necessary for our future to have a highly educated workforce.

Oil is a commodity used by the world. This is not the post World War II era where we are the last industrialized country standing and we control world markets. Gasoline price controls would cause higher unemployment exasperating our problems further.

The oil and gas industry is making progress with increasing the supply of domestic energy. By the way, this effort would be greatly reduced if we imposed artificial price controls on the price they would be able to sell their product. We have recently discovered and are exploring huge domestic natural gas reserves and we are developing “fracking” technology where oil is extracted from rock. Both will lesson our dependence on foreign oil and should help stabilize prices at the pump.

Further, we should demand the President explain why he is holding up construction of the Keystone Pipeline that would transport oil from Canada to our gulf coast. I suspect the delay is strictly political and if not, he owes the American people an explanation. He does not want to upset the environmental voting block.

There is another problem involving energy that only we the people can address. Do we really care about future generations? Are we willing to make sacrifices now so the next generation’s future is at least as good as what we experienced?  Are we willing to make the sacrifices necessary to assure that our heirs have sufficient energy to live the life style we do?  Are we willing to make the necessary sacrifices now in order to assure future generations have a clean environment to live a long and healthy life?

For more than forty years, we have talked a good game concerning turning over a good environment to future generations. So far, all we have done is talk. We want our children and great grand children to live in a clean and healthy environment, as long as our life style is not affected.

Our instructions to our political leaders are to make sure we pass on a good environment to future generations, but do not expect me to pay for it. I am having too much fun playing with my boats, planes, automobiles and high tech toys.

Choose, choose wisely!

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