Okay, it’s not really about gas prices, but at least it’s about gas stations. This is a snippet from the story The Honest Quack in the collection Four Faultless Felons. The scene is a simple conversation between two men. Windrush is a crochety old coot who sticks to his old house with one unusual tree. Dr. Judson is a very progress and forward-looking doctor, who is complaining about that same tree.
“But what’s the good of it?” Judson would cry out of the depths of dark exasperation. “What’s the use of having a thing like that?”
“Why, no use whatever,” replied his host. “I suppose it is quite useless as you understand use. But even if art and poetry have no use, it does not follow that they have no value.”
“But look here,” the doctor would start in again, scowling painfully. “I don’t see the value of it as art and poetry-let alone reason or sense. What’s the beauty of one dingy old tree stuck in the middle of bricks and mortar? Why, if you abolished it, you’d have room for a garage and you could go and see all the woods and forests in England-every blessed tree between Cornwall and Caithness.”
“Yes,” retorted Windrush, “and wherever I went, I should see petrol-pumps instead of trees. That is the logical end of your great progress of science and reason-and a damned illogical end to a damned unreasonable progress. Every spot of England is to be covered with petrol stations, so that people can travel about and see more petrol stations.”
Gas prices in my next of the woods are about $3.60 per gallon. The national average is slightly higher, or so my sources tell me. As always happens when prices go up, Republican pundits are in overdrive, trying to blame this on President Obama. Cute little graphics showing that the price of gasoline has risen from about $1.80 per gallon to its current level during Obama’s Presidency are popping up on every conservative blog and website you’d care to name. Message board posters are getting into the act by the dozen. It’s a curious phenomenon, that while the President has done so many things wrong, the Republican mob attacks him for something that’s totally unrelated to anything he’s done.
Indeed, it wasn’t so long ago that Repubicans typically expressed belief in the free market. Producers of a product offer it at a certain price, and customers may choose to buy it or not. When more customers want to buy it the producers raise their price to get more money. When there’s less of the product available, customers are willing to pay more to ensure that they get enough. These two forces, supply and demand, determine the price of the product.
Right now, gas prices are rising because of supply and demand. On the demand side, hundreds of millions of people in places like China and India, who formerly moved around on bicycles or donkeys or even (gasp!) on foot, are now able to afford cars, and thus they need gasoline. This means higher demand. On the supply side, deposits of petroleum are running dry in many places. While a few new deposits have been found recently, they’re not much in global terms, so worldwide production has been close to flat for years:
Combine these two effects and what do you get? Higher prices, of course.
(The subject continues here.)