Gov't fuel price control?

On this question, someone asked about the fed gov taking over oil prices.


http://answers.yahoo.com/question/;_ylt=鈥?/a>





Beside gut reactions, which that one is full of, can someone provide a clear, concise reason as to why or why not to have the government federalize fuel?Gov't fuel price control?
First, the oil companies are making around 10% margins on gas. See Exxon's income statement here: http://finance.yahoo.com/q/is?s=XOM%26amp;annu鈥?/a>





So, if the government decided to chop off some of that last 10%, you might get back some of that. Most people aren't going to be happy with just a few cents, though.





From basic economics, if you impose a price ceiling, supply drops: http://en.wikipedia.org/wiki/Price_ceili鈥?/a>





Firms try to maximize their profits, so they'll be willing to produce less at a lower price. If you lower it so that each gallon of gas is giving them negative profit (P %26lt; AVC), they'll just stop producing gas completely because it's dumb to keep on losing more and more money unless you're MSFT selling Xboxes trying to get market share.





They could also just sell it elsewhere and start exporting, where they can get a better price for it. China and India are starting to demand more oil as their economies grow. Or even sell the crude oil (without refining it) on the futures market and drive that down a little.





Either way, the most likely scenario of a drastic price ceiling is long gas lines, similar to what happened in the 70s. It's arguable whether this is more or less desirable than higher gas prices.Gov't fuel price control?
What difference does it make when the government is run by the oil companies?
It is not going to happen, we are entraped on this one, damned if we do and damned if we don't, prices are controled by the big oil company's if controls are put on them they will just sell it someplace else and we won't have any. We are just to damn dependant on oil. We really need to drive less, keep it to a minimum and when you do absolutely have to combine trips so that nothing is wasted. There are lots of ways to not use so much gas but we are spoiled and probably won't do it as a country.
Price controls never work. Pres Clinton tried to put price controls on vaccinations when he was in office. All that did was make it impossible for the companies to compete with other businesses. This caused them all to shut down. There are no more American vaccination producers. So, if you only want to buy oil from non-American companies, go ahead and price cap gasoline.
If the government subsidizes gasoline all of will just end up paying more taxes for the jerks who drive those big Suburbans and Navigators.





Gasoline costs $5 a liter in Germany.
Big buisness oil tycoons pay the government way too much money for the government to take it over! Plus we don't live in the Soviet Union!
not going to happen


Bush and all his bunch are oil men


there living the high life rakeing in the big momey now...
Because they don't own or control it, OPEC does.
Look at Europe.
because the price will go up and the quality down. Does with everything the government controls.