Sunday, August 05, 2007

All Gassed Up: This month's Yooperville trip report features no travel industry complaints. The lodging arrangements worked out well and it was a road trip through Northern Michigan, so there was no interaction with the airline industry. Apart from the minor issue of a bit of construction now and then, the only real problem was gas prices.

Now I am not one to complain about gas prices, generally speaking. I don't believe that Big Oil executives sit in a board room lighting cigars with hundred-dollar bills and twirling their mustaches like Snidely Whiplash while colluding to screw the honest working man out of his hard earned cash. Market forces set the price of gas, prices rise because demand is increasing faster than supply. Much of that increasing demand is coming from economic booms in China and India. Much of the lack of supply comes not because of the scarcity of oil, but the scarcity of refineries. Besides, the fact of the matter is that even at their current levels, gas prices have not kept up with long term inflation rates. If they did they would be well over $5.00/gal. No, sir: I am not at all exorcised by gas prices, generally speaking.

What I don't understand is why here in Michigan, where we are pretty much mired in constant recession, our gas prices should be higher than everywhere else. Other things equal, a lousy economy compared to the rest of the nation should reduce demand and therefore lead to relatively lower prices. Of course, other things are never equal. But I have not seen nor heard of a plausible explanation of what things are unequal. I am not asking why they are so high; I am asking why they are so high relative to the rest of the country.

As usual, everyone just gripes but no one bothers to understand and explain. Feh.

By the way, I don't think I have encountered a dumber idea in my life than a one-day boycott of gas purchases as a method of getting lower prices. That's not just garden-variety shoddy thinking. If you cannot see how totally useless such an undertaking is, you really need to take some time to evaluate whether your understanding of the world is not as shallow Paris Hilton.