HIGH GAS PRICES…
Who is really to blame for them? What do high gas prices really mean to the average American?
First things first..who is really to blame for the high gas prices? Most people want to scream at the large oil companies and say its all their fault. Believe me nobody dislikes the large oil companies more then me, but I also know that they are not entirely the problem.
Has any noticed the connection between gas prices continuing to go up and the value of the dollar continues to weaken?..What does that have to do with gas prices you are asking? Actually quite abit.
Oil is bought and sold on the world market using U.S. dollars. We usually think of the price of crude oil, and therefore gasoline, as being the result of a change in the supply and demand market. With oil supply increase, we expect the price of oil to decrease. If demand of oil increases, we expect the price of oil to increase as well. Simple economics really.
But what most people ignore is the other side of the oil for dollar trade. As with the increase of quantity of oil, that decreases the value of the oil. An increase in the quantity of dollars decreases the value of the dollar. Again basic economics.
So what does all the mean? On the international oil market this means that more dollars are needed to purchase the same amount of oil. The sellers of the oil will require more dollars for their same amount of oil. Because the dollars they are receiving buys them less in items of goods and services.
Interesting the lower the value of the dollar the higher the price of oil….Hmm
Who controls the value of the dollar? The Secretary of Treasury..The Federal Reserve..
Who controls those two things? The President..
Is the President really trying to help us? Obama is against offshore drilling. He Believes that the use of gasoline is destroying our planet. So by keeping gas and oil prices along with their taxes, it should deter people from using so much gasoline and oil. Hence lowering the demand. Yea not gonna work.
Obama's own Energy Secretary said that he would like to see Americans pay European gas prices ($5,$6 a gallon). Since President Obama has taken office gas prices have increased 67%. Thats right in less then four years gas prices have increased 67%. Compare that to the 7% of President G.W. Bush's first 26 months.
But they dont get all the blame either… Ever heard of OPEC?
The Organization of Petroleum Exporting Countries--may have more to say in the price of oil then anyone else. Who are they? They are Indonesia, Saudi Arabia, Iran, Iraq, Angola, Libya, Kuwait, Nigeria, Qatar, and the United Arab Emirates. This cartel of countries has a monopoly of the oil industry one might say. So if something is not right in one of these countries, maybe a civil war, maybe a bad economy, maybe a evil dictator, this price oil will go up to help them out in their time of need. Come to think about it all those things are happening in at least one of those countries right now as we speak.
Wow now things make alittle more sense as why we play nice to mostly all of these countries…
So what does all this mean for the average American?
It means loss of jobs, it means more poverty, less traveling and less spending. I have never heard of a "staycation" until a few years ago.
How does the price of gas effect jobs you ask?
Most people have to drive to work. Some of those people have to drive 60 to 120 miles one way just to get to work. Some have to travel from city to city because that is their business. With the price of gasoline being over $4 dollars in some places, and expected to rise in the peak travel season of the summer. People cant afford to go to work. They have to try and find jobs closer to home or one that requires less travel. That is not always easy and sometimes impossible.
Here is a horrible but realistic example. Lets say the average American makes 10.00 dollars and hour (that is above min. wage). That same average American works 40 hours a week. Simple math tells me that this average American makes $400 dollars a week before taxes. Lets say the average vehicle has a 20 gallon gas tank. We will use the $4.00 dollar a gallon price as the average price of gasoline right now. Some more simple math tells me it costs at least $80 dollars to fill the average vehicle up. The average American may have to fill up their tank twice a week going to and fro. So he/she makes $400 dollars before taxes a week. He/She spends anywhere from $160 to $200 dollars a week on gasoline. Simple math folks…This is sick. If almost half of the average Americans income is going to fuel, that leaves the other half ($800 dollars before taxes) for mortgage, insurance, groceries, electricity, water, school. Not to mention the surprise emergencies that happen. What does high gas prices mean to the average American? ALOT
Some will say "oh your numbers are high". Maybe they are but even if they are and the average American is paying a third of their weekly income for fuel that is too much. I have not even spoken about how high gas means higher grocery bills. It also means high utility bills. Supplies for companies go up because of high gas prices. Maybe my numbers are alittle high, maybe there not. One thing for sure is that are not that far off.
Now what are our solutions?
2) Expand not just allow but expand our offshore drilling. Lets start tapping into some of the areas we know hold oil but certain people will not let us drill.
3) Find alternatives to petroleum. We need to develop cost effect alternative fuels. If we can make a truck run off of vegetable oil, we can come up with something for the whole country to use.
4) Build more refineries. Ok so we drill and we start producing oil from those drills we need refineries to make the products we see at the pump. We need more and we need new ones.
Do I believe that these are the only answers. Of course not, but they are a start. You see all I see today is a bunch of politicians arguing about what to do but none of them (both parties) come up with any real solutions. So my solutions may not be the best right now, but I would rather start making progress for our future now then to wait and argue about until it is too late.
Please tell me what you think high gas prices mean to the average American and who do you think is to blame?…..Agree or disagree with either way I learn what the PEOPLE think. L2
12 comments:
Under our solutions number one is missing for some reason...1) Stop depending on foreign oil. As long as we are strong armed by the cartel of countries of OPEC there will always be high fluctuating gas prices.
I'd also like to add that we cannot totally blame the oil companies. Sure, we see billion dollar profits every year from Exon and other large companies. But what most people don't know is that a large portion of that comes from foreign countries who like ourselves are purchasing oil abroad. Second, the government shut down a huge billion dollar off shore oil drill off the coast of Alaska that would have eased the dependence of foreign oil. Third, Obama will not budge on allowing offshore drilling to resume here in the US. But one of his main campaign contributors was an oil tycoon from South America who received a GENEROUS donation upon Obama's election to president ($4 billion). While no individual is solely to blame for high gas prices, we need to start somewhere. We cannot stand by with our fingers crossed hoping it will go down someday. I think it starts with opening offshore drilling here at home. Once word gets out, the price of foreign oil will drop....but that's my opinion.
@Deanna thank you for your comment...I agree with that the large oil companies are not totally to blame. Yea they make billion dollar profits and get billion dollar tax breaks ( that is what I hate) but they are just doing their job making money like their stockholders ask them to...As far as foreign countries buying oil from yes they do but remember we only account for 5% of the oil in the world right now..So will Obama budge on offshore drilling maybe he did recently lift the moratorium on drilling...will we start drilling near Alaska? Probably not but that is why this election coming up good be important. If he won't do it let's put someone on there that will. As to his campaign contributors well I think we all have known he has taken shady donations. What about alternatives? Where are all our new ideas for new energy? Wind farms...that is not a new idea as I laugh...any thoughts?...
My opinion is that people in this country use the word "more" much too often.
More stuff more food more oil. Adjust. Our country is falling apart because
everyone wanted more than they could afford. We really just need to change our
lifestyles, spend "more" time with our families, take a bike ride to the grocery
store, and teach our children about the things that are really important. Does
anyone know why Alaska drilling is frowned upon, it endangers the minimal
remaining habitat of the wildlife of that area. Our excessive use of oil has
left it in this minimal state and now people want to do "more" drilling so they
don't have to pay so much for the gas that is basically ruining their own lives.
Think about our Supersize nation when you think about gas, think about our need
for instant gratification when you think about gas. Everything we ask for
"more" of comes with a price and it isn't always in the form of our mighty,
oops, I mean weak dollar.
@Anonymous thank you for your comment...Your opinion here matters please if you haven't sign up to follow and subscribe.. I agree and disagree with you. Riding your bike to get your groceries from the store is a wonderful idea...except that when your get there the price of everything has gone up tremendously. Why? Because of the trucks that must use fuel to deliver those products to the grocery store are still paying the high prices at the pump. I believe we do change our lifestyles, the problem is everything is going up from gas to insurance to mortgage rates to rent. The thing that isnt is American wages. As to not drilling in Alaska because it may harm the habitat well that is a risk. But when we know producing alcohol and cigarettes causes health problems do we stop the production of those products. No we don't is it a risk sure. Anyone in business will say that in order to make money you must take risks. What is overlooked about drilling and I mean new drilling is it will provide help with the price of oil but also create jobs. When you create jobs you create a better economy. With a strong economy our dollar will actually be worth something again. It's not that wanting more is a bad thing more education more exercise more wages more health more time with family are all great things to have more of. It is what and why we want more of is the question....L2
Something needs to be done ASAP, with the way the economy is right now everyone is going to suffer unless you make some outrageous figure of income a year! The President wants everyone to go to school and get an education but they cant afford to drive to school. I also think there needs to be more tuition assistance for people trying to go to college who work a full time job, trying to raise a child and pay day care that is $400.00 a month while trying to put food on the table. I also think there should be some type of mileage reimbursement at the end of the year for people that work full time and make under $30,000 a year! I don't think that it is right for people to take advantage of government assistance! They get grants for school, daycare assistance, food stamps, Medicaid, WIC and more but they go to college and just sit there and act like they don't care and fail the course all on FREE COLLEGE, hell they are the rich ones, the poor ones are the ones that are trying to skate buy with a full time job, a nice house and a nice car and trying to pay their own way to go to college to get a better paying job! So yes the gas prices suck and something needs to be done or we are in big trouble!
@Candace thank you for your comment and following the websit..I think most of agree that something needs to be done and hopefully this website stirs some ideas. Paying for and attending college and working a full time job while raising a child is harder then most people believe. Mileage reimbursement from the government at the end of the year for those that make under a certain income, interesting thought. I believe there is something like that now, you can claim mileage and gas on your taxes. Taking advantage of government assistance is a huge problem and our system does need to change. There is a man in one of the up north states (I believe it is Minnesota but I could be wrong) that won a million dollars in the lottery there. He still qualifies and received government assistance. The government sees his winnings as assests and not income therefore he can still receive he government assistance. It is the system that is broke and we need to fix it..starting by discussing it and letting our opinions be heard. Yes gas prices are terrible and hoepfully there is relief in our future. L2
the main factor for price increase our oil and gas is coming from China and India. Obama is not saying a word about gas prices going up Why?
it is increasing slowly. If Obama wanted the price to go down all he has to do is announce that oil drilling in the United States off shore is a prioity. We are going to forced to drive smaller cars or bikes. Death rates will increase. Gas prices will double,tax will increase. so here we go again it is the same thing we are in for a long haul. no win battle it just sucks.
@joro thank you so much for your comment if you havent already please sign up and follow us and subscribe via email…China and India are leaders in oil usage just as we are I agree with you there. I agree with you also that if Obama wanted the price of oil going down he would make it a priority, which at this time he has not. I want everyone to know that offshore drilling is not the only answer it is part of the solution but not the answer as a whole. Being forced to drive smaller cars well that is proven just take a look at the size of vehicles being sold today. Compact to sub-compact vehicles with at least 30mpgs…Now for the death rates increasing? ok you've got my interest I am asking how? If you dont start to find a solution to our problem gas prices someday could double. Taxes will increase that is a given. We are in this for the long haul and together you and the rest of the followers of this website will make change happen…L2
@ACE KILLJOY thank you for your comment as well as continuing to be a contributor on our site…As I state to Candace our system is very much broken. When we allow people to receive government assistance, which is usually free food free or ver low housing, free education free healthcare and we dont ask them to contribute anything back to our society is just wrong. I dont mind helping my brothers and sisters in times of need but I also want to know that when it is their turn they will help out others. It just isnt that way right now. Right now people try as hard as they can to stay on government assistance, by not working or by not reporting income, because they dont have to repay anything. Lets start making these people HAVE to find work within a year of getting on government assistance lets start giving random drug tests to those they receive it as well. Lets start making people have some accountable and contribute back to the society that is helping them in their time of need. As for the politicians, well I dont even see REP and DEMS anymore I just see you can help the PEOPLE the most. Like I have said we have create most of all our problems that we face today, but that being we will find solutions to all of our problems..We just cant give up dont think this it, it isnt gonna get any better because it will IF WE MAKE IT. I say lets get out of alot of the foreign affairs for a bit and start taking care of our own right here in the USA..havent heard one politician say that yet…So yes for the time being things may be tight but WE THE PEOPLE can and will MAKE A DIFFERENCE…L2
WELL SAID!
@ACE KILLJOY thank you…we are trying to open eyes and minds with our discussions here and i am hoping that our get opened alittle more as well. I want people to know that we arent stuck in the situation we are in, but WE have to get ourselves out and that pertains to any and all situations..L2
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