China Raises Fuel Prices

The FT reports that China has raised fuel prices across the board. Gas is now more expensive in China (about $3 per gallon) than it is in the US. What does it say about the US, when a developing country under recessionary pressures, like China, increases gas prices, while a rich country like the US keeps them low? Europe has kept gas prices high for years by adding taxes of various kinds.

Tom Friedman among many others has been calling for higher gas prices in order to promote other, greener forms of energy, but without success. When gas prices went much higher last summer, although they were still low compared to Europe, it was because of manipulation of the financial market, according to Matt Taibbi in Rolling Stone, not because of any intelligent policy decision.

It looks like the US could at least pursue a policy as sensible as the Chinese, although our policies appear to be controlled by oil and gas and financial interests who are only interested in boosting their profits, not by our national interest.