TAG | car
So I recently bought a 2010 Toyota Corolla. Naturally, I was disappointed when I heard that my car was recalled, along with many others, due to acceleration problems. However, I’ll say that my experience getting the car fixed was great.
I took my car to Koon’s Tysons Toyota in Northern VA. I called to make an appointment for 12:30pm. I got there at about 12:10 pm, gave them the keys, and sat down to do some schoolwork on my laptop. At about 12:45pm, they already called me to pick up the car. I also noticed that the customer just before me had the same exact experience. It did not appear that the service bay was empty—there were a ton of people that were getting their cars serviced at the time.
As for the effects of the repair, I drove about ten miles to get home after the repair, and I did not notice much difference. It seems like the brake is slightly more sensitive when I press it down, now. Though that could just be a placebo effect.
Anyway, I just wanted to share my experience, since it was very positive. I don’t know whether this experience is common throughout the US, or other dealerships, but I really enjoyed my service at Koon’s.
Greg Mankiw is looking for a new car for his teenage daugther. He described the most recent findings of Consumer Reports:
Dead last was Chrysler. CU recommended zero percent of the Chrysler vehicles they tested. That’s right–zero. Second to last was General Motors. CU recommended 17 percent of GM models. By contrast, most other companies had half or more of their models get the thumbs up. Honda was the top ranked brand; CU recommended 95 percent of its models.
Is it any surprise that Chrysler and GM are now in the process of going out of business? From the perspective of the Consumer Reports advice, it looks like their business model was to count on the ignorance of the buying public about the quality of their products. Their bankruptcy should perhaps be viewed as a success of the market system. (emphasis added).
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.
But this isn’t even about elitists versus “the common folk.” This is about whether we want to help the country or hurt it. If I had a choice between having a mechanic fix my car or a random neighbor, why the heck would I pick the neighbor? And if I have a choice between having Hillary Clinton or John McCain making economic policy based on hunches or someone who is going to defer to a trained professional, I’m surely going to pick the person who defers to the trained professional.
This proposal to suspend the gas tax sickens me. This is why I hate politics so much.
Please note that this is not an endorsement of Barack Obama. He’s got plenty of problems, too, the gas tax is just an area where he pseudo-shines.
Update 5/6/2008: Greg Mankiw writes:
Why, then, are candidates proposing the holiday? I can think of three hypotheses:
Ignorance: They don’t know that the consensus of experts is opposed.
Hubris: They know the experts are opposed, but they think they know better.
Mendacity with a dash of condescension: They know the experts are opposed, and they secretly agree, but they think they can win some votes by pulling the wool over the eyes of an ill-informed electorate.
So which of these three hypotheses is right? I don’t know, but whichever it is, it says a lot about the character of the candidates.
Update 5/7/2008: From The Wall Street Journal
John McCain and Hillary Clinton want to send cash-strapped consumers on holidays from the federal gasoline tax. But the law they can’t rewrite — the law of supply and demand — suggests it would backfire. Lower taxes would encourage people to drive more, meaning more demand that would push prices higher again.
Happy end of Earth Day, everybody. Speaking of exciting Earth Day news, I just read that in 2009, an all-electric vehicle will be sold in the United States:
A Norwegian automaker backed by Silicon Valley investors plans to sell in the United States an electric car that goes 110 miles without a charge and costs less than $25,000.
Downsides? It only goes 65 miles per hour and only has two seats. But hey, if you’re commuting to and from a city all the time, this is a sweet ride. I’ll have to do some more research when I get a chance to find out more… looks neat!
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?
And then we’re back to square one: why do commodity prices rise? If the only answer to that question is that prices rise because people think speculators will drive them up, then aren’t we just in an infinite cycle of inflation? Obviously, the answer to that question has to incorporate something other than whether speculators plan on buying the commodity or not. So I’ll give the classic, broad, economics answer: prices rise when the commodity becomes scarcer.
Scarcer can mean less supply, more demand, or a combination of both. And I don’t think there is a clearer example of scarcity today than oil. The world supply of oil is finite. Sure, we find new sources of oil every now and then, and we develop new technologies to extract oil from places we couldn’t get it from before, but no matter what, we have to deal with a finite supply on planet earth. Thus, every day, the supply of oil shrinks, and that contributes to a decrease in supply (along with occasional shocks from OPEC). Additionally, world demand for oil is ever-increasing. And not just in America. When the Tata Nano, that tiny $2000 car from India is released, and it puts hundreds of millions of new drivers in and around Asia on the road, gas prices will skyrocket [this is undoubtedly on the speculators’ minds].
So the high gas prices you’re paying may be technically due to “speculation.” But there must be reasons for speculation. I believe the primary reason is anticipated increased demand and anticipated decreased supply of oil.