Thursday, June 12, 2008

Is that your final offer?...

I picked up the newspaper when I got home this evening and saw that the government has predicted that the price of gasoline will peak at $4.15 a gallon.
I wish the gas stations in Hagerstown would have read the paper too, because when I came through town they were selling their lowest priced gas for $4.19 a gallon.

I guess we shouldn't be overly surprised. This is the same government that predicted (when Mitch Daniels was in charge of the predicting) that the Iraq war would cost $60 million, tops. It's also the government that predicted that Medicare would cost each worker 25 cents per week, tops.

When it comes to predicting how much anything will cost, our government has never been very good at it, so I'm pretty sure they really don't have any idea where the cost of a gallon of gas will end up. A lot will depend on circumstances that are beyond their control. Like how much oil other countries produce, and how much of that oil other countries are willing to buy.

Not that our government couldn't help us out if it wanted to. Henry David Thoreau said "this government never of itself furthered any enterprise, but by the alacrity with which it got out of its way." Unfortunately, this government has become less willing to get out of the way than it used to be.

Government regulations have prevented any new oil refineries from being built in the United States for over 30 years. Government regulations prevent drilling for oil both on and off shore. Government could allow private companies to produce ethanol from switch grass and cane instead of artificially propping up the market for ethanol made from corn.

Government could do us all a lot of good by simply getting out of the way. But I'm not counting on that happening, anymore than I'm counting on gas peaking at $4.15 a gallon.

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