IE Business Daily Business news for the Inland Empire.
Anyone notice the price of gasoline this week? Of course, if you are like most Californians who have to drive to live (instead of living to drive like the car ads), you have noticed that the price of gas is up 80 cents a gallon in many locations. In some locations, the price is above five dollars a gallon!
There are a number of reasons that have been given for this one week price spike: refinery shutdowns due to scheduled maintenance, shortages of California blend gasoline, and on and on. But none of them really hold water.
But, one thing is certain. This recent explosion of gas prices is entirely manufactured by the policies of the State of California and our elected leaders do not care. While Sacramento politicians are getting ready for a special session to raise gas taxes, the Governor and the legislature are otherwise content to say nothing about the gouging their constituents are receiving.
California already has the highest gas taxes in the country. Along with the highest cumulative sales taxes in the country (depending on your city/county) and the new carbon tax passed onto consumers by the state, Californians pay more in taxes to fill their tanks than even some other socialist countries.
But making prices higher and even more volatile is that California, alone among states, requires its own gasoline blend twice a year rotating from a “winter recipe” to a “summer recipe” and back again every six months or so. We obviously like our blended gasoline just like we like our Starbucks blended coffees, and we pay almost as much for it! And as California had been warned, no other state followed suit so the burden and volatility of these changing blends falls exclusively on our shoulders.
What is most amazing though is the silence that has befallen our elected representatives. Usually, elected officials are more than happy to publicly share the public’s angst, if for nothing more than a meaningless press opportunity and to prove they share our pain. Don’t expect too much of that. For while the Governor could temporarily suspend the mandates on reformulated gas to allow imports from oh, say Arizona, he won’t.
It isn’t because some temporary relief for motorists would deplete the ozone layer or cause global warming. No, this is about revenue. If state and local governments can’t get YOU to raise YOUR taxes, they are more than happy to watch you pay more in taxes as the price increases. Don’t expect those extra state revenues to pave your streets or fix your freeways though my fellow Californians. No, those revenues will be channeled into the ever-bloating California general fund to pay for increased welfare benefits, new health benefits for illegal aliens, high speed rail, and government employee salaries.
So as you and I watch our purchasing power eaten away by ever rising gas prices, Governor Brown and his silent supporters in the legislature are giddily rubbing their hands together awaiting your money to arrive. They will then use it as an excuse to push more people onto underutilized buses and rail cars as the cost of driving becomes more and more expensive.
Of course, when the manufactured gasoline market tumult subsides, don’t expect gas prices to fall at the same pace they raised. No folks, the price of gas, when it does begin to subside will do so at a snail’s pace just to make sure profits are maximized and the pain is prolonged for as long as possible.
There may be one upside to this whole California created conundrum. The current situation makes it increasingly more difficult for even the most obtuse legislator to vote to increase your gas taxes over the next few weeks!
