Friday, May 25, 2007

Wisconsin Hypocrisy Trip

The base foolishness of man on display in this CNN story about a Wisconsin gas station owner's "protest" never ceases to amaze me.

The owner of Towne Market Mobil in this suburb north of Milwaukee shut down his pumps for 24 hours, hoping to start a movement aimed at convincing oil companies to lower their prices.
...

Maria McClory, 38, drove 10 miles out of her way to buy a diet soda from Pollack's station after seeing local television coverage of the protest.

"I just wanted to support them and thank them for making a statement," said McClory, who drives about 100 miles a day for work in her sport utility vehicle.

Read the whole thing, as they say. It's all that juicy.

The mind simply boggles at both the behavior and attitude here. Let's say your SUV has a big ol' 20 gallon tank. A couple of months ago when gas was $2.49/gal it would have cost you $49.80 to fill up. Now at $3.49/gal it costs you $69.80. Now, how do you respond? Perhaps you trade in your SUV for family sedan or even an economy car. Perhaps you talk to your boss about telecommuting. Perhaps you postpone your summer road trip, or cut back on eating out, or make fewer, larger trips to the store and such. But none of that really quite measures up to driving 10 miles out of your way (20, if that figure is one-way), which is to say about $1.75 out of your way at a liberal estimate of 20mpg, to "make a statement". And continue to drive 100 miles ($17.45!) a day in your SUV. Brilliant. (Of course living in the sub-/exurbs, owning a huge house and one or two additional cars are non-negotiable, but that's neither here nor there.)

Better still is the window into the mind of the Great American Moron. We have the heroic gas station owner on record saying he has "virtually no control over the price he charges for gas," which is first of all absolute nonsense. He owns the station, he bought the gas from the wholesaler, he can charge whatever he damn well pleases (idiotic laws against "price gouging" notwithstanding). He can cut his price and lose even more money or he can raise it and watch everyone go down the street, which certainly puts constraints on what he can sustainably set his price at, but certainly doesn't take away his control. I can drive down the street to a corner with 3 gas stations with 3 different prices representing 3 decisions along this spsectrum. But the point is that the wholesaler (and in turn the refiner and in turn the driller) is in the exact same position. At each step in the process some firm owns this asset, has full discretion to price it in any way, yet is constrained by the realities of the market.

There is some serious cognitive dissonance here. Most folks I talk to direct their anger at gas stations themselves, simply because they are our visible point of interface with the oil market. Yet here the station owner has come out to the people and said it isn't his fault, and pointed his finger up the chain. The consumer who is outraged at the rising price of that which he buys has been invited to identify with the producer who is outraged at the slim margins on that which he sells (though he couches himself in the consumer's angle). And yet the connection is not made. The realization that we are all both buyer and seller and have such a small viable range of control, does not occur. How is it possible that we so consistently fail to see this?

This brilliant post over at Econbrowser shows the real reasons gas is getting expensive. Which, of course, boil down to "supply and demand" just like everything else. But Americans are not interested in answers, we just want someone to point the finger at, and for the government to "do something." To paraphrase Mencken, I'd expect to be getting that something good and hard pretty soon here.

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