If this doesn't get people commenting on my blog I don't know what will.
Reasons that high gas prices are good:
#1 If people are paying this much for gas , then they can obviously afford it, and if people can afford it and are buying it, why shouldn't the oil companies be charging more? Hello, economy 101 here. Plus, people making money is a boost to the economy.
#2 Less people on the road. Can you imagine how crowded the freeways would be right now if gas was $1 a gallon?
#3 higher gas prices increase public outcry over lack of alternative energy sources and public transportation, both which need more money invested in them.
I bet we hit $3.50 a gallon or more this summer.
On a different note, this is so true:
http://www.dilbert.com/comics/dilbert/archive/images/dilbert20012211860201.gif
11 comments:
#1- Yes, I suppose most people can afford it. Those that can't could not possibly survive in Southern California.
#2- You are full of crap. There would be the same amount of people on the road no matter how much gas prices fluctuated. We all just bend over and take it. No one drives more when gas is cheaper. It's never cheap enough to cause more drivers to appear on the road.
#3- Good point.
Yeah for alternative energy!
Maybe the freeway that you take doesn't change any, but the 91 and 105 have huge differences when ever gas prices go up and down. Maybe it is because there is good public transportation you can take instead of driving those routes. When you drive the exact same route at the exact same time every day for two years you notice days when you get to work 10 minutes early.
About thirty years ago, using round numbers, minimum wage was @ $1 hour. Milk cost @ 50 cents per gallon, and gasoline had just doubled to @ 50 cents per gallon. Today, minimum wage is @ $6 hour. Milk costs @ $2.50 gallon as does gasoline. We are much better off these days. We work our hour we buy our two gallons of milk, or our two gallons of gas and have money leftover that we did not have thirty years ago. The thing is, when gas prices went up a year or two ago the increase was long overdue, compared to other necessities, and a furhter increase is only logical. Have lower gas prices actually stagnated technology in this area? If they can make ipods surely someone could do something about car engines. I know there is some different physics involved there but still. I find it amazing that thirty years later so little has changed.
There are people that claim that the car companies already know how to make car engines that are 100%+ more efficient, but that the oil companies make sure that they hold back. I don't know if I believe that, but I do know someone isn't putting much effort into it. You would think people would get a clue after how well the hybrids sold.
Thanks Amanda!
Uhh Jeff...I think we've had this discussion before, but this is full of crap.
#1 - If the oil companies are charging more, it most certainly won't boost the economy. The way to boost the economy more is to lower the prices so that ordinary consumers have more money in their pockets to spend. People are always talking about high gas prices affecting the economy, and each day oil goes up, stocks usually go down. If the oil companies were really investing their money back into the economy then why are we seeing the highest ever corporate profits from oil companies now? That is money that was sucked out of and is not being put back into the economy.
#2 - There are not less people on the freeway now than there was before. The 91/105/405 are not less busy and do not fluctuate due to the price of gas. Sure a few more people started taking the train, but on average there are also more people on the freeway every day. $1 gas would not make the freeways any less busy. I used to ride the train to work because it meant I didn't have to sit in traffic, saving money was not really on my mind. Now that the train is not convienent to my house, I just suck it up and drive. I threaten to take the train again because of the gas prices, but doubt I ever will. I'll probably start carpooling again soon, but even the other guy said "the drive's what's killing me". Also see #3.
#3 - Sure there will be more public outcry, but that is not going to lead to action. I heard someone once say that they were hoping for $2-3 gas prices in Sacramento and DC. Theory being that once our elected leaders had to start paying the high prices we suffered here in LA, then they would do something. Obviously not. The LA MTA had plans to extend the light rail network far beyond what it is now, but LA votors shot that down and wanted us to beef up local buses instead. So LA's rail system limps in a slow expansion. Thing is, local bus service or even express or commuter busses aren't the answer. Many white collar workers, myself included, wouldn't step foot on an LA bus on a daily basis, but we would gladly ride a light rail or subway if it went where we were going just like you can't hand a tourist at the airport a bus map and expect them to get to Norwalk, but you can give them a rail map and they would gladly use it. Busses have their place but LA really needs a solid rail/light rail/subway network. High gas prices are not going to give the culture change that needs to take place before this happens though.
Spending money is what drives the economy. Just because the oil companies are making large profits does not mean they aren't spending the money elsewhere. Those CEO are not making money for the sake of money. If you aren't happy with gas prices then stop driving. Seriously. You are part of the cause.
I am rather supprised at the response here. We are friends people, lets be a little more respectful ya? If anyone wants to see some real stats, check this out.
http://72.14.207.104/search?q=cache:MxN_Mph9GqkJ:transweb.sjsu.edu/educ/capstones/2004Rennacker.pdf+effect+%22gas+prices%22+have+on+%22freeway+congestion%22&hl=en&gl=us&ct=clnk&cd=8
And yes, $1 dollar gas prices would kill our freeways.
The higher prices are driving more inovation in alternative fuels. Hoping that our elected officials will help us is moronic. We live in a consumer driven society, it is not the place of government to mandate that we use something different. People just need to get off their rear ends and do it. The technology might not be here yet, but it is coming soon.
The article you linked to doesn't exactly say that higher gas prices lead to less traffic. It really concluded that it would have negligable effect. It said higher gas prices may in the short term result in people buying more fuel efficient vehicles, but the long term aggregate behavior potentially returns to normall purchasing patterns. It acknowledges that gas demand is very inelastic. A 10% increase reduces automobile usage by only 1%. A 50% increase (huge) would reduce vehicle use by only 5%. It goes on to say that if the 50% increase were percieved as permanent, the resulting behavior may even be negligible on traffic. The 50% increase would have a far greater impact on the overall economy as people stopped buying other things in order to pay the higher gas bill. With such an inelastic demand, there is simply no incentive for gas companies to do anything to increase supply or lower prices. People are just going to pay it, while gas companies get richer, and the economy drags while everyone else gets poorer paying those prices.
Thing is, we really can't stop driving until there is an efficient mass transit system in place. Problem is the govt is who pays for mass transit. More busses are still not the answer like they keep saying and nobody wants to pay for the best solution.
I never said the article supported me, I just said it had some real stats.
And actually, based on your math, there should have been a noticable increase in traffic the last time there was a large gas increase. Gas went from just over $2 to $3, which last time I checked was a 50% increase. According to the article (for the 101 of course) a 200 car increase pushes the 8000 cars to an unbearable number. That means it only takes a 2.5% increase (on the 101) in traffic levels to make it unbearable. Things aren't quite as bad on the 91, but I bet a 15% decrease in traffic levels from a 50% gas price increase would be more than noticable. And yes, if people realized things weren't going back to how they were then they would go back to driving. I think most people would anyway just because they get tired of not having their car.
I'm still waiting for proof that the economy is hurting because gas prices are higher. The ratio of gas prices to inflation is very low right now. I can't see it making an impact.
nerd arguments...gotta love it ;)
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