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The Forum > Article Comments > Petrol price pressure > Comments

Petrol price pressure : Comments

By Krystian Seibert, published 18/8/2006

The impact of increasing petrol prices on motorists has become a major political issue.

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Increasing petrol prices are hurting me, like most other people, in the short term. However, I actually want petrol prices to keep going up, and dramatically so, because of the medium to long term. There will be a point where oil is simply less economically viable than alternatives, and even the bone-headed politicians won't be able to ignore it or legislate against it. Why prolong the agony?

Obviously, there would be environmental benefits to getting off oil. However, there would be massive economic and political benefits. On the economic side, Australia would benefit massively from producing and selling fuel to nations that couldn't produce enough of their own. On the political side, it would mean that the Middle East would rapidly become irrelevant, and so the constant (and indeed endemic) shenanigans there would be no one's business or fault but its own. The west could quite easily wash its hands of the whole nonsense, and with it the misguided War on Terror, and get back to some semblance of sensibility.
Posted by shorbe, Monday, 21 August 2006 8:47:30 PM
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i agree with agro
scooters are really the only way to beat the rising pertol prices, i looked at that site

www.scootersales.com.au

and found a scooter and am now saving over 65 dollars a week now that i use my scooter instead of my toyota

check it out

The frogman
Posted by frogman, Monday, 21 August 2006 9:36:17 PM
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sorry that was

http://www.scootersales.com.au/

The frogman
Posted by frogman, Monday, 21 August 2006 9:37:46 PM
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“However, I actually want petrol prices to keep going up, and dramatically so…”

Shorbe, I want prices to rise too, but not dramatically so, as that could lead to uncontrolled inflation, price rises in basic commodities, unemployment, etc, and could threaten the coherence of our whole society.

It is very important for prices to rise evenly, and in such a way that it causes us to take maximum action in seeking alternative energy sources, better efficiencies and more frugal practices, but to not push the economic and social parameters too far.

This will be very difficult, especially as prices are most likely to rise in fits and starts. The way it is looking at the moment, there is likely to be a critical price rise spike in the near future that basically tips a large portion of businesses and households over the edge of economic viability. But until it comes, many people are just not going to do very much in the way of preparation.

I reckon governments should progressively increase excise in order to raise prices during times that they appear to be fairly constant, along with maximised effort by way of financial incentives to get people to take up alternatives. Of course the extra revenue would be put directly into measures to wean us off oil.
Posted by Ludwig, Tuesday, 22 August 2006 12:00:26 AM
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Ludwig: You're probably right about requiring even increases in petrol prices to keep the economy under control.

As far as tipping businesses or households over the edge, I tend to think that in a lot of cases such people have probably over-extended themselves due to our current national addiction to consumerism. The increases in petrol over the past few years have been annoying, but I don't drive a car that doubles for an armoured personnel carrier, and I haven't mortgaged some McMansion to within a half of a percent of meltdown. Likewise, I don't have thousands of dollars in credit card debt. Did people think the good times would go on indefinitely? Those who escape from the coming recession/depression (which I think will come regardless of who is in power -- the Libs won't, and shouldn't, do anything to stop rampant consumerism, and I almost suspect the ALP not only can't help but screw the economy, but wants to) largely unscathed won't just be the fabulously rich, they'll be those who were prudent and made provision for the future by living within their means.

As for your last paragraph, the last thing we need is government dipping its grubby paws deeper into our pockets. The extra revenue could, or perhaps even should, be spent on measures to wean us off oil, but it would not. Instead, it would go into either more perks for the politicians, or into bribing the least responsible members of our society (whom it uses as a bludgeon over the middle class). In no way would it actually go towards anything constructive. You could give the money to a five year old or a compulsive gambler and they'd spend it better. I gave up on the "I'd be for more tax if only it were spent right" argument long ago because I realised that fundamentally, no tax will ever be spent right, and that politicians and large sections of society will always see those who actually work hard and are financially responsible as a cash cow.
Posted by shorbe, Tuesday, 22 August 2006 9:24:06 AM
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Shorbe

I agree that a lot of people have probably “over-extended themselves due to our current national addiction to consumerism”, and have thus given themselves very little room to move as fuel and other prices rise. But there are also many people who just battle to make ends meet and who don’t have very much room to move, without being in any way overconsumptive.

There are also many businesses that operate on a small profit margin, or that are prone to crisis if their sales or demand for services decline even a little.

We are so dependent on oil that the rising price cannot help but affect the prices of almost everything else as well as the availability of a lot of stuff….and cause inflation and rising unemployment, etc. Just when people are feeling the pinch directly from increasing fuel prices, those same rising prices are going to be adversely affecting them in a quite a number of other ways. There really is the potential for massive civil upheaval.

So the smoothest transition that we can possibly implement is needed. And this may require governments to steadily raise prices, at times well above the level dictated by the international (uncontrollable) price.

Shorbe I appreciate your concern about the appropriate expenditure of revenue gained in this way, or any tax revenue. I am not quite as cynical as you, although there certainly are problems with how this money is put back into the community. I think that governments will become much more efficient on this whole peak oil issue. The community will demand their best efforts. Anything less will very likely see them turfed out, in times of inevitable rising unemployment and interest rates...even if the opposition can’t offer anything better.

Anyway, the main thing is to keep applying the pressure, and incentives, for everyone to get the hell off oil and onto alternative energy sources (not nuclear) and plan their lives around an energy regime (and a whole economic regime) that is considerably more expensive than at present.
Posted by Ludwig, Tuesday, 22 August 2006 11:01:14 PM
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