Ask #1 Muchacho - Gas Strike?
Friday, May 2, 2008 at 09:47AM Ask #1 Muchacho is a weekly column which features real questions from real readers, and answers by LGT's own #1 Muchacho. If you would like to submit a question to be featured in this column, Contact Us Here.
Dear #1 Muchacho,
I heard there is a gas strike on May 2nd. I was told if everyone abstains from buying gas for that one day, we will cost the oil companies like $70 billion dollars. Will this actually work? And if so, is it actually a good thing? Out of Gas
In Greenfield Massachusetts
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Gassed Out,
The idea behind the strike is simple supply and demand. Right now the demand for gas is high and the supply is low (or controlled to be low) so the price goes up. If we can reduce the demand (even for one day) the supply goes up and the price comes down. The logical question is "won't people just more buy gas the day before or after to make up for it?". Yes, this is true however anyone who has ever run a business understands the importance of cash flow; especially when you are expecting certain benchmarks along the way. A drastic drop in cash and definitely throw a wrench in the works.
The issue is much more complicated than a one day strike. While the intentions are good, the effects are more likely to inconvenience the consumer and gas station owners more than the oil companies. The cost of gas is driven by many things; two of which are the dependency on foreign oil and the devaluing of the U.S. Dollar. Both of which are directly linked to the war in Iraq
Whether you agree with the war or not, the bottom line is the U.S. can't afford to continue the war at this rate. Every dollar spent on the war is essentially borrowed from China and added to the giant amount of U.S. debt. As the U.S. accrues more debt, the value of the dollar drops and gas prices continue to rise. If you look at the rise of gas prices vs. the value of gold over the past few years, you'll notice the price of gas has practically remained the same. Reinforcing the fact that if we had a stronger dollar, gas prices wouldn't be an issue.
There's not many people who would disagree that our dependence on foreign oil is a problem. Even George W. Bush and Dick Cheney would agree. Their solution was to simply take control of the oil by means of an Iraq invasion; we've all seen how that's worked out. The best thing we can do to stop spending at the pump, is to not need gas anymore. We should all make efforts to use alternative energy sources and move away from foreign oil forever.
-#1
Ask #1 Muchacho is a weekly column which features real questions from real readers, and answers by LGT's own #1 Muchacho. If you would like to submit a question to be featured in this column, Contact Us Here.
Reader Comments (6)
Vespas!
Very intelligent answer #1. I never really put two and two together like that. It's getting savage at the pumps these days. My solution:
1) Drive my Vespa and ciphen gas out of old cars tanks
2) make everyone and everything come to me.
So Nobody buys gas on May 2nd, but then everyone fills up on May 1st, so they aren't stuck without gas. gas companies still win.
Yeah brownbear, we are all aware of your techniques of making everyone come to you. come to oak sq. bro we got hills to bomb.
I had lunch with Number 1 and Durando today, basically, we came to the conclusion that a gas strike isnt going to do shit, at least not what everyone thinks it will do. At its best, it makes a statement. Cookoff is right, the people are still gonna buy the gas and the oil companies still make their money. As we all know, if anyone wants to make a difference, a change in personal lifestyle is the only thing that can do that. Ghostride your suv off a cliff and start taking the bus or riding a bike.
"We should all make efforts to use alternative energy sources and move away from foreign oil forever."
Kudos Muchacho, your intelligence and sensibility continually impress me--not to mention your stylish and sexy alternative mode of transportation. ¡Viva La Alianza del Ciclomotorde de los Rebeldes que Cogida Tetas!