How does it help the majority of Americans to pay high gasoline prices?

Question

Has anyone else noticed that the news outlets have stopped barrel-oil prices? Is it because American oil companies are raising prices when oil prices are falling? Why do all Republicans support high gas prices?

Answer 1

It allows Republican Oil mongers to gain coltrol af the American Middle class, and bring us to submission of mega-corporate rule.

Answer 2

All republicans don't support high gas prices. It doesn't help anyone but the oil industry. There haven't been any major natural disasters, no stories about refineries going up in flames or even oil spills in the ocean. It doesn't make sense why the prices are so high and no one can offer a reasonable explanation. Everyone is a little p.o.'ed including Congress. The legislation may have passed through the House with only 284-141 vote, but the goal is to ultimately make price gouging illegal through federal law by holding more oil companies liable. We may not see immediate results, but we will see a step toward progress.

Answer 3

I'm not sure if governments are supporting the raising gas prices, because such increases are hurting the economy on both a macroscopic and microscopic level. Raised gas prices means less disposable income for consumers, which means lower spending. With lower profits, companies cut wages, which lower disposable income further.

The oil refineries are private businesses (although they honestly should not be due to their oligopoly as well as their economic influence) and would typically fall under the laws of price and demand. However, due to their aforementioned oligopoly as well as the static demand of oil (which means the quantity demanded of oil is only negligibly changed by price), oil companies have little incentive to regulate their prices, which is where federal regulation needs to come in.

Oil companies are pinning their higher prices due to higher refining costs, which are due apparently to some factory updates and some recent "accidents." The actual cost of the crude oil is only a small portion of the final price of gasoline; most of the costs come from refining.

Answer 4

I don't know. I do know that a lot of our government officials, including GW is deeply rooted in the oil business. Not just republicans either.

All I know is that I will need to find a job closer to home and I am having to cut back on some necessities. I am not even a big luxury shopper because I prefer to save but I can't even do that because it takes so much to fill up. Pretty soon I will be filling my almost empty shampoo bottle just to make it last a little longer. The stores are raising prices too to make up loss in profit margins due to gas. So consumers are getting hit twice, driving to buy goods plus paying for the gas used to ship the goods.

Answer 5

None that I know of support high prices. I believe you are mistaking a belief in the free market as support.

Have you ever taken any economics classes?

Let me see if this can simplify it for you, this is similar but not exactly.

Bar Stool Economics
Suppose that every day, ten men go out for a couple of beers and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes according to our current tax structure, it
would go something like this:

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

So, that's what they decided to do.

The ten men drank in the bar every day and seemed quite happy with the arrangement, until on day, the owner threw them a curve. "Since you are all such good customers," he said, "I'm going to reduce the cost of your daily bar bill by $20."Drinks for the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. But what about the other six men - the paying customers? How could they divide the $20 windfall so that everyone would get his 'fair share?' They realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer. So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same percentage of total of what he had been paying, and he proceeded to work out the amounts each should pay.

And so:
The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33%savings).
The seventh now pay $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 in stead of $59 (16% savings).

Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings.

"I only got a dollar out of the $20,"declared the sixth man. He pointed to the tenth man," but he got $10!"

"Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, too. It's unfair that he got ten times more than I!"

"That's true!!" shouted the seventh man. "Why should he get $10 back when I got only two"

"The rich get all the breaks!"

"Wait a minute," yelled the first four men in unison. "We didn't get anything at all. The system exploits the poor!"

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him.

But when it came time to pay the bill, they discovered something important. They didn't have enough money among them all for even half of the bill!

And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier, or not reinvest in the community.

For those who understand, no explanation is needed. For those who do not understand, no explanation is possible.


David R. Kamerschen, Ph.D.
Professor of Economics
University of Georgia

Answer 6

There is no excuse for the high prices.

It's funny, though, that the same people who always defend Bush, no matter what, find a way to defend high gas prices as somehow reflective of 'The American Spirit' -- versus what they really are, which is a few robber baron rapers and plunderers getting rich at the majority's expense.

The rich always know who butters their bread. Their dedication to the almighty dollar is unwavering. The poor never get the picture. They will follow whoever lies the best.

Answer 7

I'm not sure why we are so focused on gas prices. Are they higher than we'd like them to be? Sure! But is it really causing a crisis to our economy? Does it impact our household budget significantly? I don't think so.

Take a look at your household budget and expenses. How much of it is dedicated to gasoline? For me, it's about 3%. I asked this question to Y!A a while back, and a couple of other posters agreed (see link below.) Gasoline prices are not significant.

That said, I would like to see us reduce our dependence on oil for other reasons: 1) independence from the Middle East. 2) reduced emissions through cleaner technologies.

BTW, we still pay much less for gasoline than the rest of the world. Europe's prices are off the chart (see link below.)

Answer 8

What people forget about gas prices is that the gas companies comprise a very large part of our economy... there are several industries besides the oil and gas industry that depend on the collection and refining of fossil fuels (I myself work for an offshore drilling company)... having the government suddenly take control or mandate how the oil and gas market needs to work could have very vast and far reaching economic consequences... change needs to happen certainly, but it must be slow and gradual so the economy can adjust, sudden or rapid can could collapse an economy like ours that is so dependent on oil...

Answer 9

What are you talking about stopped barrel-oil prices? Its easy to find out how much it costs. I would love to know where you found that they are falling because they have risen consistently for the last 2 weeks. But its easier for the liberal media to hide this so people like you automatically start blaming Republicans instead of OPEC. Gas prices have always reflected supply and demand.

But then again, from the looks of the thumbs up and thumbs down on here, it loos like your one of those people that posts a questions and only rewards people that think exactly like you therefor making my argument a complete waste of time.

Answer 10

my news station still reports the price of oil. the prices are still high and its due to the lack of refineries, not the amount of oil. they cost billions to build and everytime one of them goes offline then prices of oil goes up. companies aren't willing to invest in building another one since there are so many alternative methods being developed. most were build in the 70's. there was a thing on tv about this the other night. i think high gas prices make people seriously think about alternative fuel methods if any good at all is coming out of this robbery.

Answer 11

It's the sacred Laffer curve. Economics 101 to the Republicans. It is good for consumers to pay more to the oil companies. The added profits they receive will trickle down to the working masses in the form of low wage jobs for immigrants.