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Author	Topic: Time for a Price Ceiling	Topic is locked Back to Topics

A_Jelly_Donut Veteran Author Indiana Posts:411 Points:455,215 Joined:Mar 2008	Message Posted: May 13, 2008 1:31:05 PM Ignore A_Jelly_Donut Report Abuse I've been pondering this for a day or two. Thought I might as well share. If the federal government were to institute a price ceiling (say $4.50 a gallon), and the price of gas reached that, the oil companies would stop suppling gas. There would cause a shortage. That shortage would ultimately lead to reduced demand, and therefore a "reduction in dependence on foreign oil". It would probably be painful, but it would be faster than just letting the market do its thing. I'm considering writing my congressional delegation, but I thought I'd seek some thoughts from others.

A_Jelly_Donut

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Indiana

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Message Posted: May 13, 2008 1:31:05 PM

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I've been pondering this for a day or two. Thought I might as well share.

If the federal government were to institute a price ceiling (say $4.50 a gallon), and the price of gas reached that, the oil companies would stop suppling gas. There would cause a shortage. That shortage would ultimately lead to reduced demand, and therefore a "reduction in dependence on foreign oil". It would probably be painful, but it would be faster than just letting the market do its thing.

I'm considering writing my congressional delegation, but I thought I'd seek some thoughts from others.

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CaptSquid Champion Author Billings Posts:25,637 Points:3,174,865 Joined:Apr 2004	Message Posted: May 16, 2008 8:13:39 PM Ignore CaptSquid Report Abuse AllGassedOut wrote: "Q: Why is diesel more expensive than regular gas is now? A: Because you can get more mileage out of diesel than you can from gas, therefore consuming less, and our government leaders and oil companies are only interested in their own profits and have no interest in "saving the environment", greenhouse gases, "going green", reducing consuption or making it possible for American Public to live comfortably whatsoever." Actual answer: Because ULSD (Ultra Low Sulphur Diesel) is now the law of the land and is more expensive to manufacture. It is no longer the orphan fuel that it once was.
Sneakers55 Champion Author Houston Posts:51,247 Points:2,139,925 Joined:Nov 2005	Message Posted: May 16, 2008 6:49:35 PM Ignore Sneakers55 Report Abuse AllGassedOut wrote: >Q: Why are Waste-Vegetable Oil conversion kits illegal? >A: Because in general, WVO is FREE, is not yet taxed, >and is not produced by Exxon, Mobil, etc. Nobody is willing to slap down the cold hard cash to run their WVO conversion kit through an EPA testing cycle. Also, WVO can be sent through thermal decomposition and turned into Biodiesel or even Diesel fuel. >In my jaded opinion, the day you disconnect from the electric >company because you generate enough electricity from your own >solar panels to power your home, that's the day that you will >be slapped with a tax for not using electricity Nothing that I know of requires you to stay on the grid. The rate plans of electric utilities typically have a "customer charge" which they'll bill you for even if you use zero kilowatt hours. They still have to send somebody out to read the meter and generate the bill. This is NOT a tax. If your solar panels generate electricity you cannot use, the electric company is REQUIRED by the Public Utility Regulatory Policies Act of 1978 to buy it. They don't have to pay the retail rate for it though, you only get wholesale rates. Usually, it's implemented as two meters. >a "non-usage" tax, just like phone companies does for not >making at least some long-distance calls. Well, your state regulators in Pennsylvania signed up to let the phone company make a certain return on assets. And it's always politically popular to keep the price for the local loop low and move costs to long distance service. The kicker is that the price of long distance is in a race to zero. I used to pay four cents a minute until I signed up for the unlimited $20 plan. >And don't be surprised if there will someday be a minimum >amount of petroleum-based products that we will be mandated >to consume, or else face a non-consumption/non-usage tax. I read people whining "big oil" this and "big oil" that but I don't think you'll ever see a non-use tax.
AllGassedOut Rookie Author Philadelphia Posts:5 Points:200 Joined:May 2008	Message Posted: May 16, 2008 5:51:03 PM Ignore AllGassedOut Report Abuse Not so many years ago, diesel used to be considerably less expensive than regular gas in the US. How about this: Q: Why is diesel more expensive than regular gas is now? A: Because you can get more mileage out of diesel than you can from gas, therefore consuming less, and our government leaders and oil companies are only interested in their own profits and have no interest in "saving the environment", greenhouse gases, "going green", reducing consuption or making it possible for American Public to live comfortably whatsoever. Q: Why are Waste-Vegetable Oil conversion kits illegal? A: Because in general, WVO is FREE, is not yet taxed, and is not produced by Exxon, Mobil, etc. In my jaded opinion, the day you disconnect from the electric company because you generate enough electricity from your own solar panels to power your home, that's the day that you will be slapped with a tax for not using electricity - a "non-usage" tax, just like phone companies does for not making at least some long-distance calls. And don't be surprised if there will someday be a minimum amount of petroleum-based products that we will be mandated to consume, or else face a non-consumption/non-usage tax.
onyszczak Sophomore Author Chicago Posts:240 Points:49,560 Joined:Sep 2005	Message Posted: May 16, 2008 4:21:04 PM Ignore onyszczak Report Abuse fastmvr, what history book are you looking at? Price controls have worked. They can be very effective at controlling the price of a good. THey do distort the market though and guarantee shortages. And they can be weakened by the development of a blackmarket for price controlled goods. If all you want is to control prices and are willing/able to eradicate blackmarkets, price controls can work. You have to choose if you want to be able to buy all the gas you want at a price set by the market, or if you want to be able to pay a set price and not be able to get all the gas you need or want.
Johnnyart Rookie Author California Posts:84 Points:132,900 Joined:Jan 2008	Message Posted: May 16, 2008 3:09:21 AM Ignore Johnnyart Report Abuse I'd Rather Pay $1.25 Per Gallon Before the Bush Adminstration Came in and the Government Should step in and put the Price Ceiling at $2.00 Per Gallon the Limit and more public transportation should be availble...
fastmvr Sophomore Author Virginia Beach Posts:173 Points:4,660 Joined:May 2008	Message Posted: May 15, 2008 7:53:00 PM Ignore fastmvr Report Abuse You're talking price controls here and if you review history they've NEVER WORKED.
CaptSquid Champion Author Billings Posts:25,637 Points:3,174,865 Joined:Apr 2004	Message Posted: May 15, 2008 1:15:30 PM Ignore CaptSquid Report Abuse We're not communist or socialist, frede2. The free market economy works, sometimes too well, but it works.
frede2 Champion Author Texas Posts:4,240 Points:914,865 Joined:May 2005	Message Posted: May 15, 2008 9:29:11 AM Ignore frede2 Report Abuse Why not just put the oil companies under government control like Chavez, put a price ceiling that at the worst reduces the oil execs annual 100's of millions in bonuses by a dollar or so. They don't seem to have any problem with that when it is done by Chavez, Red China or the like. They still go into those countries just the same.
gk Champion Author Indianapolis Posts:3,932 Points:1,106,410 Joined:Feb 2003	Message Posted: May 15, 2008 7:14:59 AM Ignore gk Report Abuse no
doni19 All-Star Author Minnesota Posts:516 Points:260,125 Joined:Mar 2006	Message Posted: May 14, 2008 10:02:57 PM Ignore doni19 Report Abuse The less we buy the more another country would buy. A no win. Sorry buddy.
mwoo_10 Champion Author Arkansas Posts:1,821 Points:62,725 Joined:May 2008	Message Posted: May 14, 2008 7:00:12 PM Ignore mwoo_10 Report Abuse A shortage would have profound effects on the economy. Just think about this... Would I rather pay $4/gal and have gas? or Would I rather pay $2.50/gal for gas and have to wait in line all day for the gas. Evidently, some people don't remember the Carter days too well.
lizzardb Veteran Author Illinois Posts:430 Points:20,265 Joined:Mar 2008	Message Posted: May 14, 2008 10:25:00 AM Ignore lizzardb Report Abuse We crash the economy now or later. Let's get it over with.
Sneakers55 Champion Author Houston Posts:51,247 Points:2,139,925 Joined:Nov 2005	Message Posted: May 13, 2008 6:58:54 PM Ignore Sneakers55 Report Abuse You'd crash the economy bigtime as it runs on oil.
91Firebird Champion Author Oklahoma City Posts:4,586 Points:178,470 Joined:Sep 2005	Message Posted: May 13, 2008 4:01:38 PM Ignore 91Firebird Report Abuse Demand destruction makes for an unhappy economy. To put it lightly.
CaptSquid Champion Author Billings Posts:25,637 Points:3,174,865 Joined:Apr 2004	Message Posted: May 13, 2008 2:37:32 PM Ignore CaptSquid Report Abuse When the state of Hawai'i instituted a price ceiling on gasoline not too long ago, the prices zoomed to that ceiling and stayed there. When the ceiling was remove, prices returned to semi-normal. Bad idea, Jelly Donut.