tag:blogger.com,1999:blog-8861605.post7665852294886813324..comments2024-03-24T11:01:27.668-04:00Comments on Resource Insights: More coins in the fuse boxKurt Cobbhttp://www.blogger.com/profile/05330759091950742285noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-8861605.post-284448579280066672008-04-27T23:14:00.000-04:002008-04-27T23:14:00.000-04:00A fine metaphor. And of course politicians -- and ...A fine metaphor. And of course politicians -- and now the presidential candidates -- are going to pander to the electorate instead of taking the necessary painful steps to remedy the situation (as we say in the Orient, "Good medicine is bitter").<BR/><BR/>In reference to the gas tax, it is perhaps instructive to see what is happening here in Japan in that regard. On March 31 the gas tax expired due to political disagreement over its renewal, and gasoline prices plummeted. Everyone was overjoyed. Just one catch: most road maintenance projects were suspended. Since roads, especially if heavily traveled, can deteriorate quickly, this is a serious matter, and it was duly recognized as such.<BR/><BR/>Now that the reinstatement of the tax on May 1 is virtually assured, Japan's refiners have announced that on that day they'll be jacking up wholesale fuel prices by a whopping 30 yen/liter to cover the tax and recent increases in crude procurement costs. So we have (very dangerous) gasoline hoarding.<BR/><BR/>The kicker, of course, is the Catch-22 relationship between fuel cost and road maintenance. The Japanese economy is already strained by high fuel prices. But if the gas tax is lowered or eliminated in the future to help people stay on the roads, those roads start falling into disrepair (and road construction costs are high in this mountainous country). It will be interesting to see how this plays out.Rice Farmerhttps://www.blogger.com/profile/09172342023074235356noreply@blogger.com