Bob's Links and Rants

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Thursday, February 27, 2003

Bad move, Governor. Gov. Jennifer Granholm has called for routine monitoring of gasoline prices for "price gouging" in response to heightened international tension. A bill has been introduced in the state legislature to outlaw "gouging" in times of emergency, although the bill doesn't define the term.

Now, I hate to see people profit from war, but as far as I'm concerned, I'm all in favor of high gas prices. If they don't get to $10 a gallon on their own, we tax gasoline until it gets there. There are few other simple steps that could be taken that would contribute to solving so many problems. Less traffic. Fewer traffic fatalities. Less pollution. Less sprawl. Less road rage. Better mass transit, making it easier for the poor to find and get to work. And, of course, reducing the demand for more oil wars.

Even ignoring all of that, raising gas prices in times of uncertainty makes good sense from a security standpoint. If war in Iraq causes an oil embargo or terror attacks on refineries, storage tanks, or pipelines, artificially low prices will quickly result in huge shortages. Not only will soccer mom Betty be unable to drive the SUV to Krogers for some semi-toxic meat and genetically-modified potatoes, but policewoman Sue, fireman Fred and paramedic Elaine won't be able to get gas for their cars, trucks and ambulances so they can respond to all of the other terror attacks the war is likely to cause. Of course, they'll already be worn out from all of the overtime they have to work because so many of their colleagues have been called up by the military, so maybe they shouldn't be driving anyway. I'm no longer a big fan of free-market pricing, but not allowing gasoline prices to factor in (discount, in Wall Street terms) the uncertainty caused by world events is foolish in many ways. The American landscape, and the society as a whole, is badly misshapen largely due to artificially low prices of two liquids: oil and water. For governments to continue to protect these distortions only postpones the inevitable and will make it much worse when it finally arrives.