Making Matters Worse

The price of gasoline at the pump reflects the relationship between the supply of available gasoline and the demand for gasoline. Government intervention that lowers the price of gasoline without government intervention that also increases the supply of gasoline can only result in a shortage of available gasoline. Government intervention that reduces the profits for selling gasoline without government intervention that also reduces the demand for gasoline can also only result in a shortage of available gasoline.

Senator McCain wants to declare a holiday on gasoline taxes. Senator Obama wants to make oil companies pay a windfall profit tax on the excess (sic) profits from gasoline. Is it asking too much to ask for a serious Presidential candidate who understands that government intervention is causing the problem of gasoline shortages and higher prices, not leading to the solution of more gasoline and lower prices.

The market solution that will lower the price of gasoline is to allow existing oil companies to explore and drill in more places and for new competitors to enter the oil industry with the expectation of making an above average profit. More production of gasoline will lower the price of gasoline and meet the demand for gasoline.

Shall They Dance

Sun-Tzu, the Chinese General and military strategist circa 400 B.C. is attributed with being the first to say, “keep your friends close, and your enemies closer”.

I suspect Barack Obama and Hillary Clinton will each be giving the words of General Sun-Tzu much consideration as long as they both remain in politics. Publicly, they will appear to be close friends, yet privately, they will always remain close enemies.

Barack Obama desperately needs the support of Hillary Clinton voters, but at the same time, he cannot appear to need Hillary Clinton. Senator Clinton desperately wants to be President of the United States, but at the same time, she cannot appear to be a sore loser.

A Vice President Clinton would be closer and less of a pain in the rump to a President Obama than a Senator Clinton would be, but a Clinton on the ticket could add to the scandals sticking to Senator Obama.

The Vice Presidency could be a stepping stone to becoming President, but it isn’t a stepping stone Senator Clinton needs.

No matter what happens in the November election, expect lots of tap dancing from these two for years to come.

The Road Less Traveled

The rising price of gasoline has made my commute to and from work much faster and much safer. “Faster” because there are fewer cars on the freeway during drive time hours and “safer” because traffic is moving at a steady pace instead of too slow or too fast.

For me, the higher price of gas is worth the time I am saving driving back and forth to work. I am getting better gas mileage and I am enjoying my commute more.

At some point, the gas market will adjust. Fewer drivers using gas or the same drivers using less gas is lowering the demand and higher profit for gas producers is increasing the supply. Additionally, employers will have to find ways to compensate employees for their higher cost of living caused by higher gas prices.

There will come a time when the freeways are congested again and the risk of accidents will increase again. For now, I will enjoy the high gas prices while it lasts.