Think the government can control gasoline prices?


It didn't work in Hawaii
You might want to think again, take a look at this from August of 2005.

The belief in magic never dies.  Politicians in Hawaii apparently believe that ink on paper (backed up by policemen with guns) can keep the cost of gasoline lower than the price that would prevail on the market.

They're wrong.  Shortages and queues will result from Hawaii's price controls on gasoline -- shortages and queues that will cause motorists to suffer higher costs than otherwise for each gallon of gasoline they manage to buy.

The silver lining around this politically induced foolishness is that it makes the teaching of economics easier.

This is from three days ago.

Gas prices keep going up everywhere, and Hawaii's unique attempt to control them is running on fumes.

The isolated island state whose drivers consistently pay the highest pump prices in the nation has given up on its government-regulated price controls after an eight-month experiment.


With the average price for regular in Hawaii rising above $3.38 per gallon Friday, Gov. Linda Lingle signed into law a suspension of the cap that sought to keep the oil companies in check and give a fair price to customers.

Bad timing with rising oil prices, outrage among island motorists, industry lobbying and public pressure in an election year combined to scuttle the nation's only state attempt to cap the cost of fuel.

The only things that government can do to lower prices is decrease taxes and cut back on regulation.

There is no other way for government to have a positive economic effect.

A regulated market will ALWAYS create shortages and increase prices.

— NeoWayland

Posted: Tue - May 9, 2006 at 04:40 AM  Tag


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