Gas strike’s Facebook fail

I’m so glad that I don’t own a car right now. I feel sorry for the automobile owners of America — $3.60 a gallon, and that’s before the traditional summer price gouge.

Crude oil is trading for about $105 a barrel. That’s up from just $85 a few months ago. The actual supply of oil has not changed substantially.

The increase in price is because of uncertainty about current events, or in other words, a risk premium. A combination of factors is putting upward pressure on that price: a dangerous social trend called democracy spreading throughout the Middle East and the Japanese version of Chernobyl.

As a result of crude’s artificially high value, American consumers are witnessing the highest increase in price since Hurricane Katrina. Gas companies in America are using the fear of what’s to come to make a lot of money.

Damn them for being strategic.

Financial markets are hard to understand, and therefore they make us angry. Obviously this is corporate greed at its worst and somehow we need to stop it.

It’s like they don’t appreciate our business. They are taking advantage of our dependency on gas to fuel our entire lives.

How can we stop big oil from stealing our parents’ hard-earned money?

If your first idea is a gas strike for one day like those occasional Facebook events, I want you to listen carefully. You have bad ideas, and you are pulling the rest of us down with you.

I’m not an econ major. I’ve only taken a handful of economics courses, but from what I understand, a Facebook group of 600,000 slacktivists is not going to make Exxon Mobil or BP lose any sleep. Especially when the group’s info says, “PS: Try not to fill up the day before or after so that this day will have an impact on the companies.” Now the gas company knows what’s about to happen.

What is a better approach?

Prove that the demand for gas is very elastic.

Consumers need to address the higher price of gas by investing in an adequate substitute or buying a more fuel efficient car.

I’m not saying you should buy a bike, because we all know exercise is detrimental to the growth of America. Waist size and GDP are probably correlated, therefore a mass transition to a healthier nation might make us double dip. And I’m not talking about Chicken McNuggets.

Over time as we wean off gasoline, the markets will respond to the decrease in demand by lowering the price. After about five to 10 years of strenuous hybrid driving and corn gas guzzling we can go back to raping the environment with SUVs and unleaded gasoline — the way God intended.

— nicjacob@indiana.edu