Essays /

Government Intervention Gas Prices Good Bad Report Essay

Essay preview

Executive Summary

As is now common knowledge, gasoline costs in recent months have surged beyond anyone's expectations. With this sudden and unfortunate turn of events, many have called for the reintroduction of government controls in the petroleum industry (be it in the forms of taxation, regulations or price controls). There stand a few valid arguments to each side; those in favour stating that fuel prices will drop, demand will increase and the economy will be stabilized; everybody wins. The opposing side argues that government intervention in this sector of the market has never been successful in the past, and that any form of tampering with the laws of supply and demand will result in sheer market chaos, far from the intended result. Both sides will be examined in greater depth throughout the body of this report, wrapped up with a conclusion of the best course of action, based on extensive research including market analysis' and historical relevance.

Main Position

Government intervention is unnecessary, and in the long term does more harm than good to the market.

Historical Disasters as Result of Government Involvement

The majority of intellectuals today prefer to learn from the mistakes of the past as opposed to making their own mistakes and learning from them. Sometimes one should wonder why the government couldn't live by that notion as well. The NEP (Atlantic Institute for Market Studies,, a brainchild of the last Trudeau government, worked diligently towards a more "made-in-Canada" price for petroleum products, a closed (strictly domesticated) energy market, and massive government control within and throughout the industry. The result was nothing short of disaster. Almost instantly, Canada became one of the riskiest markets in the industry, plagued by enormous volatility as result of the federal government almost forcing producers to comply with prices far below normal market levels. Consequently, investment into Canada disappeared, taking numerous Canadian jobs with them. By the time the Mulroney government came into power, energy sectors all over the continent were in the process of deregulation, and...

Read more


-20 -7 /abpolitics/events/issues_nep.html). /articles/interven.htm) /news). /programs/environment). /regulatoryreform.asp), 10 10.50 12m 15 180m 20 2002 2003 250m 30 35 4 500 access action activ add advanc affect afford agreement alloc allow almost along also altern america analysi anoth anyon anywher area argu argument associ assum atlant attribut august author avail averag bad bank base becam becom begin benefit best better beyond biodiesel blame blend bodi boom brainchild break broken budget burn busi buy call came canada canadian capit carv case cash caus ceil cell cent cents/litre certain chamber chanc chao cite cleaner cleaner-burn close collus come command commerc common communism compani compar competit complain complet compli concentr conclus concret conscious consequ consid consum contin continent control corpor cost could couldn countri cours crack critiqu cut cycl damag david decid defi degre demand depend depth deregul determin develop dictat diesel differ dilig disappear disast dispos document domest drastic drawback dri drop eas easier easili econom economi effect effici elsewher end energi enorm entir equal equat equilibrium equiti especi europ even event everi everybodi everyon evid examin except excess execut exist expect expens experi explor extens extra extrem fact factor falter far fat favour feder feel femal fewer fill fill-up fix follow forc form found foundat front fuel fuel-cel fund fundament futur gas gasolin general giant gigant glad global go good govern government-impos greater grow hand happen har harm healthi hell help higher hike histor histori hong hope howev huge hydrogen ignor ii immor implement impos includ incom increas individu industri inelast inevit inform infrastructur initi instant institut intellectu intend intent interest interf interfer intern interven intervent invest investig involv ironi issu job joe jump keep kenneth knowledg kong larg last law lead learn leav left lesser lesson level likelihood limit litr live logic long long-term lose low lower made made-in-canada main maintain major make male man man-mad mani market massiv matter maximum may mean meant meddl mind minimum mistak model mokhib monetari money month mulroney name narrow narrow-mind nation nationalis natur near necessari need nep never never-end new newquist news normal north northwestern noth notion number numer obsolet offici often oil old one ontario opec open oppos ordeal order ottawa outweigh overal pain parallel part past path pay peak peopl per perhap petroleum piggi pipelin place plagu plan play plus pocket ponder posit possibl power powerhous practic prefer prevent price price-fix primarili probabl problem process produc product profit progress provinci public pump put rapid realiti realiz realli reason recent reduct refer regard regul reintroduct relat relev remain render report research resid result return right rise riskiest robert role roof run russel safer saw scarciti secret sector seem sens set sever sheer short short-term shortag shown shrink side signific simpli sinc skyrocket sledgehamm small societi sold solut somehow someth sometim somewhat soon sooner sourc spike spread stabil stand state statist stay steadili stimul strict studi success sudden summari suppli surg sustain swell system take tamper tank tax taxat technolog term therefor thing think thorough three throughout thus tide time today tomorrow top total toward transport trend trough trudeau true truli turn unawar unfortun unjustifi unnecessari upward us use valid ve veget vehicl volatil walnut want war webb week weissman well western whenev whether win within wonder work world wors would wrap, year young