22 governors

Thomas Matiska tom.matiska at ATT.NET
Tue May 29 21:17:10 MDT 2007


Oh brother,.... true there was inflation in gasoline prices(and non-energy prices also) prior to the embargo, but where was the shortage?????   where was the drop in domestic production???   I won't argue the NATURAL gas shortage of '72, but actual gasoline shortages (pre-embargo) only seem to be the product of more recent writings.   I can't find where they actually existed before the embargo....or between the '73 and '79 embargo.. only during the embargo periods.

.Why other countries also?     the OPEC cuts had the whole world "over a barrel", not just us....  There are articles to be found where some OPEC members cut production 25%, and Kuwait by 60%,  but we for some reason we want to ignore the reality that global supply vs demand was a factor.    Seems to be a lot of  Harvard.edu  and PBS.org  rants that it was all because of domestic politics...      

 

   



         "Because controls prevent the price system from rationing the supply to those who demand it, some other mechanism will take its place. A queue or lineup, once a familiar sight in the controlled economies of Eastern Europe, is one possibility. When the U.S. government set maximum prices for gasoline in 1973 and 1979, dealers sold gas on a first-come-first-served basis, and drivers got a little taste of what life was like for people in the Soviet Union: they had to wait in long lines to buy gas. The true price of gas, which included both the cash paid and the time spent waiting in line, was often higher than if prices were not controlled at all. At one time in 1979, for example, the U.S. government fixed the price of gasoline at about $1.00 per gallon. If the market price would have been $1.20, a driver who bought ten gallons apparently saved $.20 per gallon, or $2.00. But if the driver had to line up for thirty minutes to buy gas, and if her time was worth $8.00 per hour, t
he real cost to her was $10.00 for the gas and $4.00 for the time, an overall cost of $1.40 per gallon. Some gas, of course, was held for friends, long-time customers, the politically well-connected, or those who were willing to pay a little cash on the side."

         Emphasis is mine. I think this supports my prior-stated position on exactly why there were long lines. 

John Q. 
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