One of the fundamental issues I have with private corporations is how they seem to think raising prices is going to work indefinitely.
Prices should fluctuate with the market, but they never seem to come back down, at least not significantly. You cannot simply keep raising prices forever to avoid taking a loss, because eventually you are going to incur losses anyway. Nobody is going to buy your product if it becomes too expensive.
Diesel being $6.30 a gallon in America is ostentatious. It may not be completely unreasonable given the circumstances, but that doesn’t make it any less absurd.
And when it comes to petroleum, it doesn’t actually matter that much whether a particular company makes money every single quarter. Somebody is going to step in and sell it at whatever price the market will support, as long as there is demand.
I think we have been conned, as a society, into believing that corporations simply cannot incur losses or they will immediately go out of business. Historically, that has never really been the case. Essential businesses and gargantuan corporations are consistently propped up by governments, investors, and financial institutions because, in many cases, we simply cannot allow them to fail.
We cannot currently function as a modern society without diesel.
So when a company says, essentially, “We have to raise prices because otherwise we’ll lose money,” my response is: Okay. Then lose some money.
Businesses are allowed to have bad years. They are allowed to make less profit. They are even allowed to lose money. The idea that every company must continually increase prices, maintain or increase profit margins, and never meaningfully absorb a loss is not some immutable law of economics. It is a business model.
One of the fundamental issues I have with private corporations is how they seem to think raising prices is going to work indefinitely.
Prices should fluctuate with the market, but they never seem to come back down, at least not significantly. You cannot simply keep raising prices forever to avoid taking a loss, because eventually you are going to incur losses anyway. Nobody is going to buy your product if it becomes too expensive.
Diesel being $6.30 a gallon in America is ostentatious. It may not be completely unreasonable given the circumstances, but that doesn’t make it any less absurd.
And when it comes to petroleum, it doesn’t actually matter that much whether a particular company makes money every single quarter. Somebody is going to step in and sell it at whatever price the market will support, as long as there is demand.
I think we have been conned, as a society, into believing that corporations simply cannot incur losses or they will immediately go out of business. Historically, that has never really been the case. Essential businesses and gargantuan corporations are consistently propped up by governments, investors, and financial institutions because, in many cases, we simply cannot allow them to fail.
We cannot currently function as a modern society without diesel.
So when a company says, essentially, “We have to raise prices because otherwise we’ll lose money,” my response is: Okay. Then lose some money.
Businesses are allowed to have bad years. They are allowed to make less profit. They are even allowed to lose money. The idea that every company must continually increase prices, maintain or increase profit margins, and never meaningfully absorb a loss is not some immutable law of economics. It is a business model.