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Thursday, April 10, 2008
Price controls on gas?
The Atlanta Journal-Constitution
With gas 55 cents per gallon higher than last year — the national average is now $3.34 per gallon — a group of small business owners testifying before Congress Wednesday called for government price controls.
“We feel the need to limit the price of fuel on a weekly basis,” said Michael Graff, owner of a trucking company bearing his name in Natrona Heights, Pa. “The government needs to help us with the gas costs rising so we can at least budget for the coming week and know the price will remain stable.” Otherwise, he said, small trucking owners will go under and the remaining large companies “are going to tell you how it’s going to be.”
One other suggested option is to suspend the federal tax on motor fuels, which is $18.4 cents per gallon. The witnesses were appearing before the House Small Business Committee.
My view of government price controls is the same as my view of third-party presidential campaigns: Been there, done that, never again. The nation tried wage-and-price controls. President Nixon imposed them in 1971 — for 90 days, he said. It was a disaster.
The U.S. does not control the global economy. It can’t fix prices on oil. It can use public money to pay the difference between the world market price and the fixed price truckers want. Or it can tap the Strategic Petroleum Reserve. Either would be foolish.
