Sorry to harp on the gas tax holiday so much, lately, but this is hilarious:

Bloomberg.com reports that while economists have overwhelmingly ridiculed the idea of suspending the gas tax over the summer, Hillary Clinton has continued to stick to her guns. Clinton, after hearing that the economists thought the idea was ridiculous, stated:

I’m not going to put my lot in with economists

Ya know, it’s perfectly fine to say that you’re not going to listen to a consensus of football players giving you advice on filling out your taxes. Or a large group of lawyers giving you advice on how to paint your house. But generally, if you’re untrained in a subject, and practically an entire professional field gives you advice on the subject they specialize in, you should probably listen. And if you’re not going to listen, you’d better have a darned good explanation beyond “I know where you’re coming from, small folk,” for why you’re deviating from trained professionals. So Hillary (and Mr. McCain): if it makes sense to suspend gas taxes, please come forward and explain why rather than giving the same old pandering political speeches about how you’re trying to help “the little guy.” Call me an elitist, but I would rather that economic decisions follow the advice of trained professionals than “the little guy,” who hasn’t learned a thing about economics in his entire life.

I have no idea who I am voting for in this upcoming Presidential election, but I’m certainly looking more favorably upon Barack Obama after reading his reactions to John McCain and Hillary Clinton’s populist attack against gas taxes. From the New York Times:

Senator Hillary Rodham Clinton lined up with Senator John McCain, the presumptive Republican nominee for president, in endorsing a plan to suspend the federal excise tax on gasoline, 18.4 cents a gallon, for the summer travel season. But Senator Barack Obama, Mrs. Clinton’s Democratic rival, spoke out firmly against the proposal, saying it would save consumers little and do nothing to curtail oil consumption and imports.

I wholeheartedly agree. And so does one of today’s brightest economists, Greg Mankiw:

I don’t know any prominent economist who favors this McCain-Clinton proposal.

First, we have to realize that the increased gas prices are, although inconvenient in the short run, somewhat of a blessing. People are quickly starting shift away from driving larger cars, which will lower gasoline consumption in the long run. Additionally, if gas prices remain high for a long period of time, economic theory tells us that people will start taking larger actions to lower their gas prices, such as telecommuting or living closer to where they work. Additionally, this shifts more demand toward alternatives to gasoline-powered vehicles, such as electric cars, that don’t pollute and are by nature more efficient per mile than gasoline cars.

The Washington DC Metro (the DC subway system) just approved a $1 million plan to employ “mystery riders” to ride the subway trains.  Their job description:

The mystery riders would travel on nearly all routes, evaluate the service from a customer’s perspective and provide feedback to Metro.

Hmm.  Hiring someone to serve as a proxy for a customer is a great idea.  That is, unless you actually have customers who fill the role perfectly.

Metro already hears from many customers about what does not work. The agency receives between 3,000 and 4,000 complaints a month, according to agency reports. The most common complaints are late buses, rude and discourteous behavior, and a lack of reliability for MetroAccess, the paratransit service. More than 1.2 million trips are taken systemwide on an average weekday.

I am so not looking forward to riding the Metro yet again this summer.  It’s awesome to see the system make yet another boneheaded move.

I’m writing this article for the primary purpose of getting my thoughts onto a page.  I always hear all of this talk about how the only reason that oil prices are so high is because of speculation.  But that argument does not sit well with me because it ignores the underlying reason for speculation.  The argument runs that oil/gas is not really as expensive as it is, because the prices are only high because of speculators screwing around in the market.

There is some truth to the speculation argument.  Sure, speculators are buying oil, and the more demand to buy a commodity, the higher the price goes.  But, this begs the question: why are they buying oil?

Speculators in this case are people that predict the price of oil will be higher in the future than it is now, so they, in the simplest case, buy oil now so they can sell it later when it is more valuable.  If the price of oil goes up, it is because lots of people believe the price will go up in the future.  That begs the question: why do they think oil will go up in the future?