Tuesday, September 06, 2005

Nationalized Gas?

For some reason, people in Canada are now thinking that a new National Energy Program is a good idea. What I find awful about this is that people would seemingly rather tear apart the constitution than pay $2.00 a litre for gas.

Sure a NEP 2 would be strictly legal, but clearly the constitution wants the provinces to control their natural resources. This is largely a good thing, and should not be discarded to keep SUV's on the road.

Finally, for the conspiracy theorists............ If you think the gas companies are fixing prices for gas, stop buying gas! The only way to test this theory is to see if the price is elastic with demand, so stop buying gas and find out. As long as we keep buying gas, no matter the price, the price will inevitably go up. NEP 2 applies a production solution to a problem that is rooted in consumption. Bad economics, bad policy, bad idea.

Comments:
Welcome aboard to Progressive Bloggers
 
As well, I extend a welcome!
 
Ditto ;)
 
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