Greetings Citizens!"We are living, in an age in which the pursuant of all values, other than Money, Success, Fame, Glamor, has either been discredited or destroyed" eloquently spoken in a very disturbing movie titled, Party Monster.
Now, I am sure you are wondering, what does this have to do with the price of fuel in America? I will tell you, these words are evident as the land we walk.
OK, so I am not the only one who has noticed the price of fuel when I fill up my gas tank. Today, I paid $3.1499 for a gallon of fuel, for 11-gallons my total Visa card purchase was $34.65. Ouch! Did you or your company's annual "pay increase" budget for this? Probably not.
So, now I pose the question, why are we paying so much for fuel? I will be glad to openly and honestly tell you! Reflecting back to your economics class, remember, "Supply & Demand"? Basically, when you have a high demand for a product/service and a limited supply, prices will rise. When there is an overabundance of supply, with limited or no demand for the product/service, prices will fall.
Now that you've been reminded, let's think more about why we are paying so much. Define fuel demand. Demand can be defined as a strong need or desire for something (like bathroom tissue, paper, food, shelter, etc.). It has been reported that we (humans) use 1.6 Million barrels of oil a day. That's a lot of oil! Granted supply is limited (damn limited number of dinosaurs), at what point does someone think, "Hey, how can I profit from this?" Using the lesson we just learned about Supply & Demand, they (OPEC) decided "let's cut supply and call it maintenance or something". The result would be record earnings for oil companies AGAIN and record fuel prices AGAIN.
What about previous reasons for higher costs like increasing demands for fuel, hurricanes, terrorism, an overturned semi-truck, or a raccoon caught in a trap in Alaska? That must be the reason for higher fuel prices right? I heard it from some no-name fuel analyst or "talking head" on CNN.
I pray that we are not that disconnected, granted I do not doubt we use a lot of oil (1.6 MM barrels daily) but the other reasons were minuscule that may have had very limited if any impact on the cost we pay for fuel today. Those scapegoats were just statements to appease the public. The real reason is ** the American dream, to have the most money, to be the most successful, to be the most famous, and wear glamorous clothes. ** I mean, why not exploit a traded commodity that can make a lot of people MORE WEALTHY. Let's be honest, if we were benefiting from the healthy dividends, we would not be complaining. I mean, Tiffany has to drive her Range Rover for safety and Tyler needs his Yale education, he got all C's this semester - we are so proud! He will make a brilliant President!
In the real world, which I and most of you live in, we do not have that luxury. So, now I ask:
WHAT CAN WE DO?
We can reduce our fuel consumption by maintaining our vehicles, we can minimize our vehicle trips, we can use mass transit in our cities, we can even car-pool. This being said, what if we are already doing that? What else can I do? The reality is NOTHING! The oil industry has something we need, not want. If we want to get to work, go to school, visit our family, heat our homes - we need fuel...AT ANY COST and they know it.
Referring back to economics, what can help drive down the cost of something? Competition. We have many different oil companies and manufacturers in the world; however there is only one agenda - to make more money. Real competition would be another resource readily available to use instead of gasoline/diesel - that is the only way to reduce costs.
What has been done to get us to that point in time to have alternative fuel sources? Pretty much the same thing as mentioned above NOTHING! There are too many people fully invested in oil to actively pursue something else. Could you envision if our current gasoline/diesel powered vehicles could easily accept something renewable like hydrogen without having to buy yet another $30,000 car? I am probably going to be killed for making these claims, but it NEEDS TO BE SAID.
You know what sucks the most? The average American family has enough issues and debts to deal with and with business people obligated to impress their shareholders, we have are subject to their rules and game. Sorry everybody, what they are doing is not illegal (unless you say gouging), but it does lead to questions of ethics. Is it ethical to cause financial hardship on people for your own personal gain? I strongly believe most would say yes.
Come on, it's American Capitalism - great concept- especially if you are the one profiting from it!
