Haggling Over Our Price

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A front-page story in today's New York Times tries to explain how a government-issued $100 "rebate" to compensate for high gasoline prices seemed like a good idea at the time to Senate Majority Leader Bill Frist. "The rise and fall of the Republican $100 rebate," write Sheryl Gay Stolberg and Carl Hulse, "offers a window on how Washington sometimes [sometimes?] works in a slapdash way, featuring in this case Congressional aides who misread the political climate and lawmakers desperate to hang onto their jobs [is there another kind?]. It is a story, as well, of how concepts and plans can be reduced to sound bites that make them seem [seem?] absurd."

The problem, apparently, was that writing a $100 check to each of us was, in the words of Sen John Cornyn (R-Texas), "a nonserious response to a serious problem." But isn't that just the sort of response people deserve when they demand that politicians magically take care of whatever happens to irk them at the moment? In addition to high gas prices, I'm annoyed by the mosquitoes in my yard, the pain in my right arm, and the fact that we have not yet received a satisfactory offer for our house. Why aren't the Republicans working on eight-point plans for these serious problems?

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  1. I don’t know if that’s the response they derserve, but it is the response they want.

  2. I’d make you a better offer on your house if you would get rid of those damn mosquitoes.

  3. “I’m annoyed by the mosquitoes in my yard, the pain in my right arm…”

    Try stickin’ the needle in the other arm, you pinko communist!

    Oops, wrong thread.

  4. So…what, now I’m not getting my $100 bucks? that’s a load…

  5. Very nice usage of brackets there, Jacob.

  6. I’m still hoping that the payoff check is big enough for a downpayment on one of those new Hummers…

  7. It was such a patronizing and idiotic idea. Here is $100….now go shut up.

  8. what about the title – Life of Brian? “Ten for that you must be mad”

    🙂

  9. ROFL
    Another great post Jake

  10. Families need gas, hard working Americans need gas, and that means people have a RIGHT to gas! The only way that we can really solve this problem, is if we have a UNIVERSAL GAS SYSTEM!!! Only when people are allowed to consume as much gas as they need, without any cost to themselves, can we truly overcome this problem. The needs of people are more important than any ignorant laws of supply and demand!

    If the great economist like Keynes, or Galbraith, have tought me anything – it is that the only way to overcome shortages of limited commodity items is to subsidize mass consumption of that item!

    If you elect me as president, here is my plan for solving the fuel crisis:

    1. I will stop the preditory behavior of car companies. Some lower income families are forced to use smaller, more fuel efficent vehicles, because they cannot afford to pay for gas! It is not right that car companies should offer less fuel use to some people, than to others. I will force car companies to make sure that all cars have 8 cylinders, and it should be illegal to discriminate against low income people by offering them anything less.

    2. I will eliminate the profit motive from oil companies. Oil companies exploit us for profit. They search for new sources of oil and fuel, not because they care about us, but because they want to make as much money for their greedy selves as they can! I will make sure there is NO PROFIT in finding oil, refining oil, and selling it to the consumer. Only when there is no financial incentive for oil companies to exist, can we be sure that oil companies are opperating out of altrism and not greed!

    3. I will ban the undermining of the National Energy System. Some indulgent wealthy individuals don’t want to be part of the National Energy System, and they want to be “off the grid”. These rich folk want to live above the rest of us, by using luxurious and decedent solar or wind power, instead of using the same energy system as good, hard working Americans use! Much like private schools undermine public schools, and private health care undermines public health care, this PRIVATE energy production system undermines the collective ability for our national system to produce energy. In order to stop the ultra wealthy from undermining our system, I will make solar and wind power ILLEGAL!

    Vote for me… vote for America! Only by working together, and putting energy in the hands of the people, can we all have all the energy we could ever dream of! Rex Rhino – Republicrat for president!

  11. If it makes you feel any better, I ain’t got an offer at all on my house. Holy shit– maybe there is an epidemic of not-immediately-selling homes that the government needs to address. Seriously, I am against imminent domain, but I wish to hell someone wanted to build a stadium on top of my neighborhood right now.

    The $100 rebate was ridiculous on at least two levels. One, that the government would do something like that in the first place (which turns off the libertarians), and two, that if the government was going to do it, that it would be such a pathetic sum (which turns off everyone else). What the fuck is $100 going to do for anyone?

  12. Jeff in TX:

    It didn’t turn this libertarian off (that much). Compared to what sort of “reform” is sure to be in the works, this “nonserious response” — as John Corynn put it in J. Sullum’s original post — looks positively spectactular to me. As paltry a sum as $100 may be, it beats just about anything else they’re liable to do.

  13. Sadly, Rex, one man’s parody is another’s policy.

  14. “I’m annoyed by the mosquitoes in my yard”

    D’jever try a bug-zapper?
    The sound of it zapping mosquitoes is annoying, but the annoyance is ameliorated by the washing over you of the feeling of instant “justice.”

    Real life is just chock-full of six of one, half dozen of the other choices, eh?

    Having made paper in a former life, I can report bug-zappers have long been a legitimate “business” expense for that industry.
    Someday, a study should be done to determine whether bug-zappers actually reduced the frequency of extremely flat insects under our quills.
    I’m thinkin’ they didn’t.

  15. “that means people have a RIGHT to gas!”

    Rex Rhino,
    Have you ever burped a baby?
    Sometimes you almost need to abuse them to retch the goal.

    Now, as a senior dude, I find the need to jaggedly jog up and down a few flights of stairs in order to fart myself… especially after corn flakes.

    Sharing here.

  16. All right, I can’t take it anymore, I have to ask: Why is any libertarian complaining about the government’s giving back money it took from us?

    Seriously. Virtually everyone around here has been either mocking or slamming this $100 thingee since it was first announced, but nobody’s really explained what’s so funny or bad about it. What assumed premise or conventional wisdom am I missing here?

  17. The government should use its eminent domain power to confiscate all refineries and gas stations. Then gas would be free. Vote for me, I’m smart!

  18. bigbigslacker,
    Were you liberated by my earlier comment about freeing gas?

    Gas was not destined to eternal solitary confinement in Mr. Bowel.

    Mr. Sphincter doesn’t need a fence to keep gas in and Mexicans out.
    Come in here Herrick.

  19. All right, I can’t take it anymore, I have to ask: Why is any libertarian complaining about the government’s giving back money it took from us?

    We are offended by the idea that someone would bribe us with our own money!

    Imagine, if a mugger stole your wallet, then offered you half the money not to go to the cops.

  20. Dusty,

    I’ll add that the “giving back money it took from us” description would make more sense if we weren’t running a budget deficit.

  21. Why is any libertarian complaining about the government’s giving back money it took from us?

    The suggestion that giving everybody a hundred bucks will make gas-price problems vanish is an insult to our intelligence.

  22. My “complaint” regarding the Free Money Project:

    It’s illogical and idiotic, because the long term effect will be to make the problem worse instead of better.

    I am one hundred per cent in favor of any program to fix the income tax (preferably the one that involves ABOLISHING IT). But- and I am speaking here as somebody whose “fleet” includes a Chevrolet Suburban with a 454 cubic inch motor (10 mpg on its best day)- the gasoline tax should be higher than it is now. The price mechanism works.

  23. Ruthless, Herrick will be along shortly, just as soon as he get his balls.

  24. Imagine if somebody took out a loan in your name, sent you the check, and then told you that the bank will be getting in touch to collect interest and administrative costs. Would you be upset?

    From a strict mathematical perspective, of course, you would be indifferent to that “borrowing” if you could invest the money in something that yielded more interest than the bank was charging, or use it to pay off a debt that carried heavier interest.

    But I have a hunch that most people here would be upset anyway.

  25. Nice job assuming that all of the dissatisfaction being expressed about gas prices amount to the public “demand(ing) that politicians magically take care of whatever happens to irk them at the moment.”

    Lord knows there aren’t any serious points being made about oil dependence, energy use, domestic supply, refining capacity, and OPEC. Nope, everyone just wants the government to waive a wand.

    Good thing for Jacob Sullum that his job doesn’t depend upon popular support. Unlike certain Republican Congressmen, his arrogant dismissale of the little people as idiots aren’t going to cost him his job.

  26. The suggestion that giving everybody a hundred bucks will make gas-price problems vanish is an insult to our intelligence.

    So, does that mean I can have your hundred? My intelligence has a real thick skin…

  27. Crimethink, if they want to give us money purely for the hell of it, that’s fine. But don’t feed me some bullshit line about how a one-time payment of a hundred bucks is going to make our gas pains go away.

    It’s Saturday night and I am at work. I am NOT in the mood for political bullshit today.

  28. As paltry as it may seem, $100 is actually a significant benefit. I’m completely serious. Think of it as rolling back prices to 2005 levels for 100 gallons (the difference between, say, gas at $3.25/gallon and last year’s $2.25/gallon). You can also think of it as a 30% off coupon for the same 100 gallons. My wife fills up her 12-gallon tank about once every three weeks or so. I fill up my 16-gallon tank once a week, due to commuting. For her, $100 bucks means enjoying 2005 prices for almost another six months! For me, sadly, time would roll back for only about six weeks. But with all the driving I must do, that’s still nothing to sneeze at.

    I don’t think I have ever seen the rebate viewed from this perspective in any account of the proposal. Yet, it’s really the viewpoint that seems to make the most sense.

    I’d gladly take the money, but I wouldn’t for a minute forget that it would be nothing but a band-aid, a cynical way to placate angry voters in an election year, instead of doing something of substance to deal with the larger problem. When they want to be, politicians can do the placation thing well. The solving the real problem thing, however, seems ever to elude them.

  29. When they want to be, politicians can do the placation thing well. The solving the real problem thing, however, seems ever to elude them.

    Anybody wanna place bets on how much higher prices have to get before the politicos decide that price controls are the answer to our problems? I’m thinking somewhere in the four-dollar range.

  30. Jennifer, I’ll take that bet at $3. Such policies are already in the cooker.

  31. Maybe I’m a jerk, but I have a serious case of schadenfreude about the high gas prices. People who made stupid economic decisions are getting there comeuppance. Examples:

    My friend who just had to pay $3500 extra for his Honda Accord with the 240 Hp V6. (Almost all of his driving is in the city, so he doesn’t even need the power.)

    Everyone who commutes to work or school in an SUV, V8 sedan, etc.

    Everyone who lives an hour or more away from their job.

    People who drive regularly for fun.

    People who jackrabbit between traffic lights and stop signs.

    People who drive across town to save 50 cents on a gallon of milk.

    Etc.

    Solution to the problem: Drive less and buy a car with better mileage.

  32. Argh! There s/b their.

  33. Bill says, “Everyone who lives an hour or more away from their job … Drive less and buy a car with better mileage.”

    Are you talking distance or time? I’m only 33 miles away from my job. But there does happen to be a mountain range and a twisty, dangerous highway between me and it, so that the average one-way trip is 50 minutes, and all too many trips exceed an hour, often in hazardous conditions or bumper-to-bumper traffic.

    It wasn’t always so. I worked on my own side of the mountain range for several years, and a heavy one-way commute was 20 minutes. But the economy went south, the job went away, and I was faced with either moving away from an area that I and my family loved and had worked hard to reach — and INTO an area we all despised! — or putting up with the commute for the sake of a little stability in our non-work life.

    I don’t drive an SUV or truck. But I DO drive a car that is big enough to be comfortable for commute purposes (and which provides enough space for passengers and luggage when we take family vacations), as well as powerful and nimble enough to get and keep me out of troubles in unpredictable mountain-highway traffic. That means I average 23 miles to the gallon. If you’re going to enjoy schadenfreude over the fact that my fuel costs have gone up by 25% or more in the past year, then great. I’m not complaining about the rise in prices, however, at least not in the sense of blaming those “greedy oil companies.” Here in California, the long-term reticence to build refineries, the insistence on special formulation gas, and the too-high and frequently misused state tax have a higher-priority claim on my ire, as constituents of the relatively exhorbitant price of a gallon of unleaded.

  34. JAM,

    As a lifelong Californian myself, I’m all too aware of the government idiocy you mention.

    An average one-way trip of 50 minutes is less than one hour. Also, you are not one of those people that move far away from their jobs and purposely self-impose a long commute.

    Are you a tall man? I’m 6’3″, so I’m not comfortable in a small car. Small people who commute alone in giant vehicles for more than an hour each way (sometimes two to three hours!) are more the target of my ire.

    Just a guess, but it sounds like you live in the South Bay (of the San Francisco Bay Area).

    Anyway, you don’t sound like the type I was complaining about. Thirty-three miles isn’t that far and being stuck in traffic is mostly idling anyway.

  35. Bill said, “As a lifelong Californian myself … Just a guess, but it sounds like you live in the South Bay…”

    Born in San Luis Obispo; been in Santa Cruz County for 15 years so far. Damn glad ta meetcha.

  36. Instead, they should be working on achieving lower gas prices by removing the government impediments against them. Also, something that can be done imieadiatlty is to reduce the gas tax and offset the reduction with permanent spending cuts.

  37. Rick, why would you want to reduce the gas tax? It is one of the few GOOD taxes that we have! Unlike income, payroll, sales and property taxes, from which the vast majority of our state and federal revenues are derived, the gas tax is a tax on “bad” behavior with negative externalities. The other taxes I mentioned are the opposite – they are taxes on “good” or neutral behaviors. Gasoline has between .50 and $1.50 per gallon in negative externalities due to pollution (completely untaxed currently) as well as about $.50/gallon worth of associated road building at the federal level (currently taxed at about 2/3 that rate). If we were to be efficient and fair, we should be talking about immediately RAISING the gas tax to a doller per gallon or more. I am perfectly willing to couple that with reduced income taxes in order to make it tax-neutral, though honestly, we need to raise taxes until some politician actually proves the government can cut spending.

    As much as possible, it is better to tax bad behaviors than good ones. We should be exploiting this opportunity to the fullest, not running from it.

  38. Joe–

    So you want to get upset that the rise in gas prices is funding oil companies instead of the government–I think; I’m completely reading between the lines. Because otherwise you seem to be suggesting that anyone concerned about energy dependence will be upset about oil prices and demand a subsidy for their consumption.

    And really, do you think the soccer mom is worried that gas prices aren’t high enough from taxes instead of oil industry profits? Or is it that they have to pay more now than a few weeks ago for something they want to consume more of to power their outsized SUVs?

  39. [Are you a tall man? I’m 6’3″, so I’m not comfortable in a small car. Small people who commute alone in giant vehicles for more than an hour each way (sometimes two to three hours!) are more the target of my ire.]

    Ha! Who says short people got no reason to live?! 🙂

    If the supply of gasoline stays the same, and yet everyone is given a hundred bucks, won’t the price just rise that much higher because of increased demand?

    Speaking of high gas prices…Has anyone heard the one about the guy who gave the gas station attendant five dollars and said he wanted some gas? The attendant handed him a receipt and farted. 🙂

  40. jw,

    Hilarious!

  41. Chad:

    …the gas tax is a tax on “bad” behavior with negative externalities…Gasoline has between .50 and $1.50 per gallon in negative externalities due to pollution as well as about $.50/gallon worth of associated road building at the federal level (currently taxed at about 2/3 that rate).

    There is nothing “bad” about the ability of folks to independently go where they want when they want. How do you arrive at your figure for pollution externalities? Remember that auto emission rates have been falling steadily, due to improvements in technology, since years before their regulation by the government.

    The high gas prices fall hard on the working poor. Reducing the gas tax and offsetting it with permanent spending cuts, cuts which are long over due for our governments bloated budget, would make economic sense as well as being humane.

  42. Hey, $100 is $100. I don’t see how I could be worse off, but do see how I could be better off, with an extra $100 tacked on to my fed income tax refund this year. How could it possibly benefit me for them to not send me an extra $100? How could it possibly cost me to receive that extra $100?

    I guarantee you the feds will pay less interest for that $100 than I would if I borrowed it.

  43. Vote for Rex, vote for Bigbigslacker.

    The last Reason newsletter was right on: the political fallout of this scheme has set Frist way back. Score one for the (classical) liberals, and anyone suffering from government-bullshit fatigue.

    Btw, I prefer my checks in Yuan, that should save on currency conversion.

  44. I’m with the pro-$100 bandaid crowd. I don’t think its any long term solution, and I don’t see that anyone is presenting it as such. But of all the things the government might plausibly come up with as a response to high gas prices, this does the least harm. I’ll take the $100. It works just like a temporary reduction in gas taxes.

  45. “But of all the things the government might plausibly come up with as a response to high gas prices, this does the least harm.”

    Har har- that’s a good one. Prices today are important. Expectations of prices tomorrow are really important. If the government tells you, once again, that it will protect you from the consequences of your actions, is there an incentive to change your behavior?

    ——–

    “It works just like a temporary reduction in gas taxes.”

    Indeed it does.

  46. There are things the government could do that are better than the refund. I just don’t expect them to even consider them. I expect they consider things like price caps. This is better.

    I don’t really need to change my behavior. I likve 5 miles from work and only have to fill up about once a month. I have a 1999 car, and I just hit 30,000 miles last week. High gas prices don’t hurt me much as I don’t drive much. But I’ll take the $100 anyway, thank you very much.

  47. Know why Public Storage Properties stock has done so well?
    All those gasoline rationing tickets have been in storage there since the Carter administration.
    Will Dubya finally break them out?
    Did Nixon impose wage and price controls?

    Who knows what Dubya is liable to do if he is prevented from nuking Iran.
    I’m thinking there will surely be a snitty blow-back of some sort.

  48. Anybody know what circus tickets cost these days? I can get decent bread for a few dollars at my local bakery. That leaves a good chunk of the $100 for circus tickets.

  49. So, basically, a lot of you are protesting the return of your $100 because it shows that the government doesn’t understand economics.

    Whatever…

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