GAS TAX HOLIDAY?!
Ok please tell me that Americans are smarter than to fall for this load of bull.
Let me explain something here, they tried this in Illinois and it failed, why? Because oil companies are not going to just concede.
Here's a couple of scenarios that top economists say will happen (and did happen in IL)
1. Tax prices go down, demand goes up, supply goes down, prices go up.
THIS IS CAPITALISM
Simple right? even an idiot could figure that out.
Well here's another scenario...
2. We need those taxes to pay for roads, highways, sustaining infrastructure, silly things like that, so you don't lose a tire in a pot hole. It has been proposed that oil companies repay moneys to the state for such projects, to make THEM pay for infrastructure instead of us at the pump.
A) Let's say gas is $3.59 and the tax is about $1.40, the oil companies will just up the price of gas BACK to $3.59 and collect that extra $1.40 for themselves (which is what they did in IL), giving them more billions and saving the average tax payer about $30-45 over three months.
B) Let's say they do not allow companies to up the prices back to the original $3.59, so we pay $2.19 for three months while Exxon eats the profits and puts money into infrastructure losing a billion dollars in revenue. To get that money back, when the gas tax "holiday" ends, they will boost gas up to $5-6 to make up for all the money they lost for that three month period (it's called "replacement pricing"), screwing us again.
This holiday is not an answer, it's pandering for votes and playing to people's emotions and frustrations. Don't fall for it or the people who proposed it (McCain and Clinton, yes... they agree on something)
The only solution is to reduce people's habits (or regulate like back in the 70s) and look towards the localization of business to decrease import costs and trucking costs. We built our economy on petroleum and now it's screwing us.
So if you really wanna bring costs down
BUY LOCAL!
Ok please tell me that Americans are smarter than to fall for this load of bull.
Let me explain something here, they tried this in Illinois and it failed, why? Because oil companies are not going to just concede.
Here's a couple of scenarios that top economists say will happen (and did happen in IL)
1. Tax prices go down, demand goes up, supply goes down, prices go up.
THIS IS CAPITALISM
Simple right? even an idiot could figure that out.
Well here's another scenario...
2. We need those taxes to pay for roads, highways, sustaining infrastructure, silly things like that, so you don't lose a tire in a pot hole. It has been proposed that oil companies repay moneys to the state for such projects, to make THEM pay for infrastructure instead of us at the pump.
A) Let's say gas is $3.59 and the tax is about $1.40, the oil companies will just up the price of gas BACK to $3.59 and collect that extra $1.40 for themselves (which is what they did in IL), giving them more billions and saving the average tax payer about $30-45 over three months.
B) Let's say they do not allow companies to up the prices back to the original $3.59, so we pay $2.19 for three months while Exxon eats the profits and puts money into infrastructure losing a billion dollars in revenue. To get that money back, when the gas tax "holiday" ends, they will boost gas up to $5-6 to make up for all the money they lost for that three month period (it's called "replacement pricing"), screwing us again.
This holiday is not an answer, it's pandering for votes and playing to people's emotions and frustrations. Don't fall for it or the people who proposed it (McCain and Clinton, yes... they agree on something)
The only solution is to reduce people's habits (or regulate like back in the 70s) and look towards the localization of business to decrease import costs and trucking costs. We built our economy on petroleum and now it's screwing us.
So if you really wanna bring costs down
BUY LOCAL!