Australian Politics Forum - Does the price affect consumers?

freediver

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Does the price affect consumers?
Dec 19^th, 2010 at 9:09am

perceptions_now wrote on Dec 18^th, 2010 at 11:58pm:

freediver wrote on Dec 18^th, 2010 at 9:36pm:

gizmo_2655 wrote on Dec 18^th, 2010 at 2:55pm:

FD, do you seriously believe that a 'tax grab', which will increase the prices of consumer goods and services, and sending the money raised overseas to 3rd world countries will have anything more than a microscopic effect on the environment??

Depending on the tax, it can reduce emissions anywhere between 0% and 100%.

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If the Government(s) simply add $X amount (call it $20) to the production cost of a megawatt of electricity, do you think that will 'cause' the power company to do anything other than pass that $20 along to their customers???

That's how it works.

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Where is the incentive for them to spend $100 million dollars to research, design and build a new, 'green' generator station??

It's called competition. There probably would not be any incentive unless the tax was higher, which is a good thing. We should take advantage of the cheaper options first.

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Tax breaks, or co-funding would work far better

NO it wouldn't.

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Remember the 'Flys and Honey' analogy...

Fortunately economists have a better grasp of the situtation than what little insight can be gained from old sayings.

Is that how Oil/Petrol Consumption was reduced, because of the Petrol excise?

It's more like, more -
Credible
Reliable
Abundant
Paradoxes

Let me re-phrase that, it's CRAP!

The Petrol Excise didn't reduce Petrol consumption and a Carbon tax would achieve the same result, which is ZERO.

In any event, whatever happens here (in OZ) is irrelevant, it's what happens in China, the USA, India and the other major consumers, where the real battlelines are.

You (FD) & everyone else, you need to ask one question -
If a large Global reduction in GHG emissions is required, to mitigate the risk of a massive Climate Change disaster, HOW COULD A VERY SUBSTANTIAL REDUCTION IN GHG EMISSIONS BE ACHIEVED, given the guaranteed objections from many with vested interests?

It depends on the amount of the tax PN. Like I said, you can achieve anywhere between a 0% and a 100% reduction in consumption with a tax. It is wrong to suggest that the petrol excise had no impact on petrol consumption. Making deceisions that impact the economy without any genuine understanding of economics will lead us to ruin, not matter how good your intentions are. You are right that economics is full of paradoxes, but only to those who don't understand it.

What happens in Australia does matter, because it will have an impact on our economy and our lifestyle if we stuff it up.

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The_Barnacle Gold Member Offline Australian Politics Posts: 6205 Melbourne Gender:	Re: Does the price affect consumers? Reply #1 - Dec 19^th, 2010 at 9:18am Does the price affect consumers? Without a doubt it does. When oil prices go up, consumption falls. In 2007 when petrol prices hit $1.70 in Melbourne the numbers using public transport skyrocketed.
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gizmo_2655

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Re: Does the price affect consumers?
Reply #2 - Dec 19^th, 2010 at 4:49pm

The_Barnacle wrote on Dec 19^th, 2010 at 9:18am:

Does the price affect consumers?

Without a doubt it does. When oil prices go up, consumption falls. In 2007 when petrol prices hit $1.70 in Melbourne the numbers using public transport skyrocketed.

Was that because the petrol companies passed the increased costs on to the consumers???

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It's similar to a strawman fallacy"
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hawil

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Re: Does the price affect consumers?
Reply #3 - Jun 9^th, 2011 at 5:55pm

Price will affect consumption; a good example are bananas, as 75% of banana production was destroyed y the cyclone yasi and the floods, only 25% of bananas are currently hitting th market, and as government does not allow any banana imports, only 25% of bananas are currently consumed in Australia.
But here is the hitch: as the banana price has quadrupled, the total cost of bananas to the public is the same as when the bananas were being sold for around $3.00, therefore the growers which were not affected by the flood or cyclone, are laughing all the way to the bank.
I never thought that the average Joe Blow in Australia will not be able to afford bananas.

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perceptions_now

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Re: Does the price affect consumers?
Reply #4 - Jun 9^th, 2011 at 6:36pm

hawil wrote on Jun 9^th, 2011 at 5:55pm:

Price will affect consumption; a good example are bananas, as 75% of banana production was destroyed y the cyclone yasi and the floods, only 25% of bananas are currently hitting th market, and as government does not allow any banana imports, only 25% of bananas are currently consumed in Australia.
But here is the hitch: as the banana price has quadrupled, the total cost of bananas to the public is the same as when the bananas were being sold for around $3.00, therefore the growers which were not affected by the flood or cyclone, are laughing all the way to the bank.
I never thought that the average Joe Blow in Australia will not be able to afford bananas.

In the case of bananas, the lack of supply has pushed the price higher, because the Demand hasn't fallen away, as much as Supply.

The big difference between bananas & Fossil Fules, is that there are alternatives to bananas, whereas there are really no current alternatives to Fossil Fuels, in particular Oil.

So, if bananas quadruple in Price, we simply pick another fruit, if the Price of Oil quadrupled, due to Demand outstipping Supply, then the Global Economy goes into a massive Depression.

The only possible fixes are finding new sources of Energy, particularly Liquids &/or the changing over of the transport industry & several others, to new modes, where they can work without Oil!

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