rss feed: Latest Entries | Archive
2008.06.05 @ 22:38:46 basic economics

<rant>It's obvious that there's far too many people in the U.S. lacking knowledge on basic economics. For example, the fact that supply and demand set the prices for the things we buy. I'm pretty sure they teach this in elementary school, and again in high school if you take the right classes. Economics ought to be a required class in high school. Today, everybody is complaining about gas prices. There's any number of things one could do to 'protest' high gas prices - the best thing would be to buy less of it! Instead, we have people doing stupid things like setting fire to gas stations. It doesn't sound like she actually burned any gas, but let's assume the end goal was a big kaboom - you've just reduce the supply of fuel, therefore making the price even higher yet.

Speaking of the high gas prices, a few thoughts that you all probably know, but I'm going to rant about anyway. First, good thing is people we buy more fuel efficient smaller vehicles, and hopefully we'll have fewer giant trucks and SUVs, which aren't as safe. In general, I could care less that the trucks and SUVs guzzle gas, but if everyone drove more fuel efficient cars, the demand for gas would go down, and therefore the price would drop. Second, people could drive more friendly... might reduce accidents, although historically that isn't true.. but people could stop tailgating and whatnot which is generally less efficient. It will accelerate development of alternative fuels, this is good. Encouraging ethanol, is bad... at least, corn based... last I checked it requires more energy to make it than you get back from it. That's bad.

Related to that... there's this thing with sugar. The US Gov't artificially inflates the price of sugar to help sugar farmers. This is bad. First, it means we end up with corn syrup in everything instead of sugar since corn syrup is cheaper... at least it is now (maybe not if ethanol production increases). I want good soda like Europe & Mexico have... with sugar instead of corn syrup! As an aside, let's assume the Gov't stops regulating sugar, now suddenly sugar based ethanol - like they produce in Brazil - becomes a viable, and much better option than corn. Is it going to upset agribusiness? Yeah, for a bit. But it will adjust.

In general, I think the Gov't needs to get its hands out of business. Funding research for new technologies: good. Helping already well established businesses? Bad. </rant>