[XavierLarry]

Whether it's good politically, it's silly from an economic standpoint. Market forces allocate scarcities and higher prices, which indicate demand outstripping supply, reduce consumption and bring those forces back into balance. Artificially reducing the price removes incremental resistance on use and thus demand increases, using up relatively scarce resources at a faster and more damaging rate. Of course, expecting anyone on Capitol Hill to understand basic econ 101 is a pipe dream. Just my 2 cents.

[Coldwater Creek]

What you are going to see is long lines at the pump.

Everyone should just learn to conserve and make some sound financial choices.

[Old_Mil]

Market forces allocate scarcities and higher prices, which indicate demand outstripping supply, reduce consumption and bring those forces back into balance.

Price elasticity of demand is measured as the percentage change in quantity demanded that occurs in response to a percentage change in price. For example, if, in response to a 10% fall in the price of a good, the quantity demanded increases by 20%, the price elasticity of demand would be 20%/(− 10%) = −2. (Case & Fair, 1999: 109).

In general, a fall in the price of a good is expected to increase the quantity demanded, so the price elasticity of demand is negative as above. Note that in economics literature the minus sign is often omitted and the elasticity is given as an absolute value. (Case & Fair, 1999: 110). Because both the denominator and numerator of the fraction are percent changes, price elasticities of demand are dimensionless numbers and can be compared even if the original calculations were performed using different currencies or goods.

An example of a good with a highly inelastic demand curve is salt: people need salt, so for even relatively large changes in the price of salt, the amount demanded will not be significantly altered.

Similarly, a product with a highly elastic demand curve is red cars: if the price of red cars went up even a small amount, demand is likely to go down since substitutes are readily available for purchase (cars of other colors).

As people cannot easily move from one residence to another, move from one job to another, or easily change vehicles oil has an inelastic demand curve.

[LS]

Small problem with your logic: removing GOVERNMENT-IMPOSED taxes isn't "artificially reducing" prices---it is putting the prices back to where they would NORMALLY BE without such goverment perversions of the market.

GOP ought to get on this one, quick.

[Muleteam1]

It's been many years since I took Economics 101 but I don't buy this scheme either. Everyone seems to think the cost of the Federal and State taxes will be subtracted from each gallon of gas they purchase. Giving an auto importer a break on the import taxes they normally pay to import a classic Mercedes SL does not lower the price of that car in the marketplace. The marketplace could care less what the cost of production is. Lowering the tax to produce the Mercedes only means that the auto importer will reap more in profit. I suppose one can hope that the used car saleman will pass his savings on to them but they had better not hold their breath for oil investors to do the same. When the Democratic devils offer anything with their left hand, you had better pay attention to their right hand with the knife.

Muleteam1