Sunday, July 24, 2011

Is the price of gasoline too high?

Like you (probably), I think gasoline is too high, and that if we don't find a way (by drilling more offshore and opening up the Alaska oilfields) to lower the price of crude, high energy prices (along with excessive government spending) will kill our economic engine.

Leave it to an historian to put things in perspective. Larry Wood over at the Ozarks History blog says this:

Yet, when viewed from a historical perspective, the price of gasoline is really not all that far out of line from other goods and services. I can recall paying as little as 17 or 18 cents a gallon for gasoline during the 1960s, but that was during the so-called "gas wars" that were relatively common in those days. The usual price was more like 25 to 30 cents a gallon. Until recently, the price of gas nowadays was in the three dollar per gallon range. So, you might say that gasoline has only gone up by approximately a factor of ten. I can think of many other products that have gone up at least that much. For instance, I recall that the going price for a candy bar when I was a kid was a nickel. Nowadays, a Snickers bar costs over a dollar if you purchase it at the local convenience store. That's a factor of twenty! Things like health care and higher education have probably increased that much as well.
Well, I still think gasoline costs too much, but I encourage you to click on the link to Woods's Ozarks History blog to read more. He has a ton of information there. Now that I've stumbled upon his blog, I will visit it regularly.

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