As a trained economist, I find one part of Australia’s current fuel debate surreal. Fuel supplies are tightening. Service stations are running dry. Governments are talking about supply disruptions, emergency imports and contingencies for essential users. And into that situation comes the predictable LNP popularist cry: cut the fuel excise. Make petrol cheaper.It might be a good political sound bite. But it's not smart economics.When something's in short supply, making it cheaper is an irrational

This blog piece, imo, explains well why a fuel excise cut is the wrong way to go in a fuel crisis that is only going to get worse and also provides numerous actions the govt can take (and should have taken before this) to help people with transport.

  • ikt@aussie.zone
    5·
    21 hours ago

    When something’s in short supply, making it cheaper is an irrational response. Lower prices encourage higher demand. That’s basic economics. If fuel is scarce, the priority should not be to stimulate more consumption of it. The priority should be to conserve it for uses that matter most.

    Exactly what I said!

    The problem in regional areas is that the current demand is causing petrol to fly off the shelves so fast they can’t keep up and stations are running out

    Why would you want to make a product that can’t currently keep up with demand cheaper?

    Lost their minds

    • arbilp3@aussie.zoneOP
      6·
      21 hours ago

      They haven’t lost their mind, they just don’t know how to use it intelligently and/or trying for the populist appeal.