My Sunday column, “Gas prices not high enough,” discusses negative externalities omitted from the price we pay for gas at the pump. As expensive as gas is, the price does not incorporate numerous costs borne by people who did not consent to the transaction.
The column was not popular among those readers who responded.
I’ve pasted a couple typical e-mails I received, followed by my response to one:
I don’t know whether you are ignorant or just plain stupid to think that we are not paying enough for gasoline. You probably support President Obama’s moratorium and the environmental whackos on drilling for new oil. Apparently, You don’t understand that the increase in oil prices impact everything that consumers HAVE to purchase from home heating oil to groceries and clothing. Just how do you, in your vast wisdom, propose that people who live on fixed incomes such as social security and retirement plans and haven’t receive any pay increases in two years can afford to pay more at the pump and the grocery store? Excluding state, county, and city employees, few workers have received pay raises in the past two years. How do you propose those people pay for the increases for everything they have to buy? Maybe you can write about this next Sunday
You have apparently bought the green nonsense that petroleum products are bad. Your article about the costs of externalities totally ignores the benefits (externalities) that cheap petroleum has brought. Most Americans would put their individual mobility among the the most important of their blessings. Without it, we would be unable to live in areas unserved by public transport. Managing large farms and ranches would be impossible, effectively tieing us back to the labor intensive, inefficient farms of our forbears. Our food varieties would necessarily be confined to those available in our local areas. You propound a premise that alternative fuels are good no matter how much they cost; that everyone could afford them. You concentrate on gasoline. Where would we get the lubricants and chemicals that drive our economy? When you process crude oil you get more than 4000 petrochemical products. How will you replace these and at what price? Do you believe that the American standard of living can be maintained without cheap energy sources?
A simple Google search would have taken some of the stars out of your eyes. A thriving economy requires cheap and plentiful energy, so does a high standard of living for everyone. Solving the pollution problems is a much better choice than crippling the economy by limiting the supply of cheap energy.
I couldn’t decide whether I was more stupid or more ignorant, so I just responded to the second e-mail. My response:
Individual mobility is not an externality. Neither is large-scale
farming. The transaction price at the pump incorporated those
Where did I say alternative fuels are good no matter the cost? If I
were write on the topic, I would note that externalities also are
present in alternative fuels. Look at the waste issues in nuclear power and
the risk to the population; the dead birds and ugly landscapes around
windmills; the toxic releases from the manufacture of solar panels;
“Solving the pollution problem” does not have to be an externality.
That is, the cost of the solution can be borne by the purchaser rather
than the payer of non-transactional taxes. Road taxes already
accomplish this for road maintenance. The dreaded cap-and-trade would
do it for carbon emissions.
Our overwhelming energy problem, I think, is we are trying to shift
too many costs to the taxpayer. We would not have to subsidize
ethanol, for example, if the actual costs involved in gasoline were
included in the pump price. Instead taxpayers spend money cleaning the
the Gulf, and also pay to subsidize alternative fuels.