Thursday, April 27, 2006

some thoughts on gas prices

Gas prices are high. We are not happy with this. We want gas prices to be lower, because we want to keep driving our huge trucks and SUVs that get 15 miles to the gallon.

However, the government subsidizes the oil and gas industries. That is, the government gives oil companies numerous tax breaks that enable the price of gas to seem a lot lower in the eyes of the consumers. According to the International Center for Technology Assessment (CTA), gas should actually cost anywhere from $5.60 to $15.15 per gallon. We actually do pay the remainder of this money through taxes, insurance premiums, and higher prices of other goods.

The CTA says it best when it states, "When the price of gasoline is so drastically underestimated in the minds of drivers, it becomes difficult if not impossible to convince them to change their driving habits, accept alternative fuel vehicles, support mass transit, or consider progressive residential and urban development strategies."

Therefore, I say let's get rid of these subsidies! Let the price of gas be its true value = $6/a gallon. That way people who choose to change their driving habits don't have to pay taxes that provide gas subsidies, and those who refuse to change their habits can fully support these habits on their own. Perhaps, doing this will really encourage us to actively seek new alternative fuels and more effective transit systems.

This article is a pretty good read:

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