What sort of rationing works/does not work?

fiedag · Tar Sands Joined: Apr 20, 2006 Posts: 29

The oil situation seems to suggest there will not just be demand destruction but that there will be some form of rationing.

I have followed this forum for over two years and it occurs to me there has never been a decent discussion of the mechanics and intricacies of petroleum rationing.

Surely it is happening already in some places? Please post the details of the scheme here as and when it happens.

It has happened in past - certainly during war times but also more recently. We had widespread strikes here in Australia in the 80s, requiring petrol rationing. I seem to remember cars with an odd-numbered numberplate could fill up on odd days and so on. Not really sure whether it ever did any good.

wisconsin_cur · Moderator Joined: May 10, 2007 Posts: 2967

As we await some knowledgeable folk to speculate, I would like to add a question. As the owner of a diesel vehicle would we also expect to see some kind of diesel rationing or would the demand destruction from the collapse of the diesel truck shipping industry provide enough slack?

Would it be an issue of "fairness"?

Might I be able to retire all the debt I have for the resale of my diesel powered vechicle (if it were not subject to rationing)?

car19

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Cloud9 · Light Sweet Crude Joined: Jul 26, 2006 Posts: 1036

Ration coupons worked in WW II.

idomar

I remember the fuel blockades of 2000 in the UK, the individual petrol stations rationed the amount that could be bought, and many were reserved for what they called "priority users". but this was a situation out of the control of the majority of the public so there was a good reason to ration fuel

But we are headed for a natural, long term decline that will only be noticed by the public once it affects their wallets in a serious way, this will then mean that in the future, there will be no 'fairness' in how fuel is distributed, It will be, who you know and how much you can pay, remember this is a free market. no one is forcing you to buy petrol, or drive a car.

Revi · Fusion Joined: Apr 25, 2005 Posts: 3252 Location: Maine

In the Hirsch report they mention dusting off rationing plans from the 80's here in the US. I think that it will happen, and that essential things like agriculture will get some diesel. There is no way we can let the market alone mitigate the crisis that's coming. Farmers and essential services would be priced out of the market for fuel, while a few rich people drive around in Hummers.

Jack · Dark Lord Joined: Aug 11, 2004 Posts: 5085

Sure, there will be rationing.

And then there will be a black market.

Some people will respect the rationing scheme. Some won't. Guess what I will do. Cool

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Fishman

Two choices, 1)ration by cost, 2)ration by government. Benefit of number one , no black market, maybe less organized crime associated. Problems are self evident, the poor suffer the most. Number 2 creates a black market exactly as Jack mentioned with organized crime benefiting. Generally poorly run. World war two rationing limited distribution and amount. It "worked" in that the government got what resources it needed. Government rationing leads to dramaticly reduced access with long lines or cheating in other ways.

Byron100

I would vote for a hybrid rationing system...one that would allow a small amount of fuel to be bought at a low price (something like 2 gallons a week), and then allow the market to set whatever price for whatever people want to pay above that for their Hummers and whatnot.

It is my hope that the newly (and quite jealous) poor will do things such as "tagging" fuel guzzlers driven by the uncaring rich with spray paint, as well as outright vandalism in the mall parking lots...a single Buck knife is capable of slicing a lot of tires... Twisted Evil

But yeah, let the market and jealously do most of the heavy lifting in regulating gasoline usage...and the guvvie "ticket" program would at least allow some sense of fairness in the general population.

Revi · Fusion Joined: Apr 25, 2005 Posts: 3252 Location: Maine

We'll have rationing, but how will this work? I wonder how well the people in power can pull this off? They haven't done too well so far with the disasters they've had to deal with. Bush couldn't clear his schedule even to visit SoCal until tomorrow. Hello.

I don't think they'll be very pro-active about gas rationing.
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topcat

Well if the rationing were to be done by auto tags, odd numbers on X day, then wouldn't it be great to have several beater cars at home so you could fill all of them up?

basil_hayden

It seems to me that the only rationing that works or ever worked was WWII style war rationing, for the common good, for a common goal. Coupons make more sense to me than an odd/even day scheme because it would leave some room to buy or sell extra coupons if necessary for the moment. Early 1970s rationing was quite aggravating.

Now if Need could be logically prioritized without greed and corruption, we'd have a system that made sense and people would be more likely to adhere to.

gollum

I would also favor a system of say 2-5 gallons a week per family at a cheap price, then the market does the rest, or a system of tradable rations where a person had say 10-20 gallons a week, but could legally save rations for the future, and sell unused rations to others, so the guy who drives a prius could sell his extra to the fat cat who drives the hummer. I think in the long run this would encourage savings.
Maybe instead of rationing fuel we should look at extra sales taxes on inefficient items (SUVs, Air conditioners incandescent bulbs) and using the money for rebates on efficient items (hybrids compact floscrent bulbs and swamp cioolers), this as a whole would be a lot better than any type of rationing model.

gollum

I would also favor a system of say 2-5 gallons a week per family at a cheap price, then the market does the rest, or a system of tradable rations where a person had say 10-20 gallons a week, but could legally save rations for the future, and sell unused rations to others, so the guy who drives a prius could sell his extra to the fat cat who drives the hummer. I think in the long run this would encourage savings.
Maybe instead of rationing fuel we should look at extra sales taxes on inefficient items (SUVs, Air conditioners incandescent bulbs) and using the money for rebates on efficient items (hybrids compact floscrent bulbs and swamp cioolers), this as a whole would be a lot better than any type of rationing model.

fiedag · Tar Sands Joined: Apr 20, 2006 Posts: 29

I would love to see a pic of the WW2 rationing slip - could you scan it?

I note the wikipedia article on rationing is quite a good introduction. I especially like the bit about "maintaining equality of sacrifice".

The question we have not answered yet is why would a government implement rationing at all? I mean other than as an altruistic exercise in maintaining order.

Is there an economic motive why you would do it? Like as a way to maintain prices and profits? I think so. If a country's economy is so paralysed that nothing moves, then the demand for gasoline plunges. And so does the price of crude. Exploration then becomes unprofitable and the oil&gas industry is terminally stuffed. The oil&gas industry should be expected to have initiatives ready to prevent this scenario.

What other reasons can you suggest for why we should implement non-price rationing? I really think we need to discuss the "why" before we can settle on the "how".