(Maybe this 3:30 pm traffic jam I took a picture of in Las Vegas a few years ago is a thing of the past)Well the problem is back. The gas stations in town are all out of fuel, as are the stations in Asheville. Prices did not skyrocket this time (there were allegations of price gouging last time), the result is however the same. Everyone is in a mild panic ...and so we should be. We live in a community that has no sidewalks and mile after mile of narrow country roads.
The one fun thing for me. I am sort of an oddball novelty on campus. I am one of three bicycle commuters on the whole campus. The jeers have now turned to honest questioning. I can imagine the day when there might be as many of six of us commuting by bicycle :-)
Of course once the supply routes reopen and fuel arrives, the F250's used as commuter vehicles will be back in full force.
2 comments:
Here's my thought on what's happening in your area. If stations get close to running out of gas, they should be allowed to raise prices to what the market will bear. I fully believe that's the heart of supply and demand. The problem is no one likes supply and demand economics when there's a lot of demand. If they have a limited supply, then they should be able to charge what people will pay (price gouging to me is undesired, but seems to be a logical side effect of low supply and high demand). If nothing else that action will force people to look into alternatives and make them want the government to invest in other energy sources a priorities. But if the government keeps imposed limits on what can be charged for gas, then nothing is going to change in the short term.
On the other hand, I can fully see how some oversight is required, lest a group of suppliers get together and collude to artificially raise the price collectively.
I don't know it has been awhile since I had Mandelschlect's Economics courses at VT :-), but I think that the situation we have in WNC probably violates several of the basic assumptions that are made when modeling the theory of supply and demand. For starters I don't think the gasoline wholesalers and retailers approach a perfectly competitive market situation.
Additionally, during the suspicious period of price raising activity a few weeks ago there was not an immediate shortage of gasoline, but rather the fear of a shortage ...perceived supply was low, but in actuality there was no shortage.
This last go-round. The prices remained the same, but there was a real supply issue. In a true supply and demand response the prices would have gone really sky high in the past few days, but they never went over 4$ a gallon. I certainly don't have the whole story...but it is interesting.
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