Here is a list of the top six things the government can, should, and won’t do to greatly reduce gas prices and six things that are likely to either have no effect or raise them, but are frequently done anyway. (The following post comes from a recent reply to an online forum.)
Top six ways to reduce gas prices:
1. Eliminate direct and indirect sales taxes on gas. (Road money has to come from somewhere of course, but taxes on gas do not provide an efficient means of paying for them.)
2. Eliminate state and federal regulations regarding contaminants and fuel mixtures.
3. Break up the OPEC monopoly by forcefully privatizing oil production in the Middle East.
4. Eliminate anti-trust regulations, especially against oil and processing companies.
5. Sell federal lands, especially in Alaska.
6. Eliminate emissions regulations on cars.
Top six things the government is likely to do that will raise or not affect gas prices:
1. Fuel-efficient cars, and especially federal subsidies for them. The impact on worldwide oil use is too small to matter, but car manufacturers must pass on extra production costs to consumers.
2. The war in Iraq. Obviously, this has raised, not reduced oil prices, as expected.
3. Government price controls on gas. Socialists who think that market prices are set at the whim oil companies while government prices are set according to some form of bureaucratic omniscience are deluding themselves.
4. Boycotts on gas buying = total economic ignorance not worth a response.
5. Public transportation and car-pooling. This may reduce the cost of transportation for individuals, but it will have little impact on global oil prices. Meanwhile, public transportation is subsidized by higher gas taxes.
6. Government-mandated “clean” energy and electric cars. Where do you think the energy for electric batteries comes from? Magic? Like recycling, if it’s not chosen by the market, it’s more likely to waste, not save energy costs.