I have gotten this email forward so many times and it is so stupid. LKVoice has already pretty thoroughly debunked it, but of course it continues. Today is June 13th. You probably shouldn’t boycott petrol today because that would be pointless and actually economically backwards. That said, the new traffic system is so unbelievable fucked that I’m seriously going to buy a bike for a lot of my stuff. I worry about getting my head cracked open, but now that the cars are moving an average of 2km per hour on weekdays, I don’t think it’s that dangerous. But back to petrol, the numbers in that forward are made up and wrong, and the argument is ass backwards as well.
This is the response I sent when I got it in my mail:
For reference, that attached forward is bullshit. They’re not even converting currencies for their comparison.
They say the price is Rs 157 in Sri Lanka and Rs 48 in India. And it is. Petrol costs about 50 Indian Rupees, which converts to about 126 Sri Lankan. In Malaysia it’s rising to 2.7 Ringit which is like 90 LKR, not 18. I haven’t gone over the other prices, but I suspect they’re similar bullshit. I won’t even start on the economic premise of the protest, which is similar bunk. The only way SL and even India can lower prices is by subsidizing it. And where does this money come from? Us again. And where do these emails come from?
The honest, difficult and long-term fix that any economist supports is to actually raise the price of gasoline until the market adapts away from it (re: Friedman).
By the way, I heard that Barack Obama is Muslim.
In all honesty, the global rise in oil prices is good. Oil is bad for us in many ways – it corrupts the countries its found in, it pollutes the earth and it’s generally a bad scene. Economically, one of the simplest ways to change mass behavior is by changing the price. If it becomes more expensive alternative energy suddenly becomes more competitive and that can finally get the research inertia to replace this crappy system with something better. As with almost all human progress, we’re going to have to eat it for a while, but we will be far far better off in the long-term. Almost all major economists actually advocate a gas tax to engender this behavior. To quote Das Wiki:
Taxes on transportation fuels have been advocated as a way to reduce pollution and global warming, conserve energy, and for certain countries reduce dependence on imported oil for foreign policy reasons. Placing high taxes on fossil fuels makes alternative (and often less polluting) fuels such as biodiesel or electric batteries more attractive, and put price pressure on manufacturers and consumers to choose more fuel-efficient products and processes.
Of course, in Sri Lanka alternative fuel research is pretty much restricted to breeding better bullocks. Even electrical cars would be kinda pointless here because we produce electricity by burning petrol (smart, I know). The period for the global economy to produce cheap, efficient alternative transportation is going to really hurt for the third world because we’re like 10 years behind. Right now we’re driving used Japanese cars, so we have to wait for the conditions to change there before we get reconditioned results there. Regardless, this has to happen.
Sri Lankans protesting isn’t going to make a difference because we’re tiny and no one would really notice if we stopped buying petrol entirely. Only group that would care is the government and all they can do is pay for it with our money via subsidies. Hence pointless. If people really want to protest they should demand that the 100% importation duty be lifted on hybrid and hydrogen cars and electric trishaws and stuff. Winning any protest for cheap fuel is about as likely as free lunch, and makes about as much sense as policy.