President Barack Obama deflected blame for high gas prices yesterday, by blaming American consumers for their automobile choices. According to the AP, at an event at a wind turbine plant, “Obama needled one questioner who asked about gas prices.” Obama laughingly said: “If you’re complaining about the price of gas and you’re only getting 8 miles a gallon, you know…you might want to think about a trade-in.” (The AP later scrubbed this quote from its stories) For most Americans, however, high gas prices are no laughing matter. And for the …
No matter how hard the government tries, it just won’t ever be as effective as the free market is in satisfying consumer demand. Want proof? Take a look at what the federal government is doing to lure people into buying more expensive, less convenient plug-in electric cars. Since little demand currently exists in the market for electric cars, the government offers a tax credit of $7,500 to those who purchase vehicles like the Chevy Volt and the Nissan Leaf. And even with the tax credit, electric cars aren’t flying off …
Government mandates, preferences and subsidies don’t work. Here’s another example. When gas prices hit record levels over the summer, companies were furiously pumping out oil to meet surging global demand. As the economy took a turn for the worse and demand slowed, there was a noticeable lag as companies continued to supply oil at a high rate, bringing the price down even further. A similar phenomenon is happening with hybrid car sales. Wes Brown, a partner at Los Angeles-based market research firm Iceology, told the Los Angeles Times:
As President Obama and Congress are starting to learn, it isn’t easy running American businesses from Washington. This week AIG threw bonuses in the faces of their new CEO’s on Capitol Hill, after Senator Chris Dodd (D-CT) specifically legislated that they could do just that. Senator Dodd is apparently wishing he hadn’t made that decision now. Now we learn that the auto companies that American taxpayers are bailing out an alarming rate are being forced into more bad decisions by lawmakers. Their new “bosses” on Capitol Hill are forcing them …
