Sushi Money

One of the stories taking a back seat to the financial crisis the past couple of weeks is how gasoline and other fuel supplies are in such short supply all across the southeastern U.S.  Supplies are so tight that some people are sleeping in their cars overnight just to fill the tank!  Take our poll below and share your views.

“In Atlanta, half the gasoline stations were closed, according to AAA, which said the supply disruptions had taken place along two major pipelines that have operated at well below capacity since the hurricanes knocked offshore oil production and several refineries out of service along the Gulf of Mexico.”

How did this happen, and why only across the southeast?   Presumably this region is almost exclusively supplied by gulf coast pipelines and refineries, and based on hurricane’s Gustav and Ike the stockpiles are really low.  Many refineries are still starting up, or just now increasing production from being shut down due to the hurricanes.  But the refineries had also cut back production of gas supplies  before the hurricanes because the price of oil and gas has been falling.  The storms timing couldn’t have been worse, and upwards of 40 million barrels of oil production was lost over the past month. 

But I have to wonder:  How do the oil companies keep their prices (and profits) high?  But restricting supply and keeping demand at a higher level.  That was the story before the hurricanes, and it will  simply take a few more weeks to get the supply back to normal.

For the drivers needing fuel in the southeast however, they don’t care what got them to that point.  They just want more gas as soon as possible.  And during a period of short supply of any product, what emerges as a human tendency?  Stockpiling and hoarding.  Not only do we top off our fuel tanks when we have the chance, but we also fill up extra gas cans for the lawnmower, the generator and just to have a little more on hand. 

Some experts say that hoarding is a natural expectation to a shortage of anything humans may need, as a method to ensure adequate supplies later on.  Is this true?  And if so, does that mean it’s okay to stockpile or hoard extra supplies of something when your neighbor might not have enough?

“A hurricane-related disruption in gasoline supplies prompted jittery drivers from Atlanta to Nashville to top off their fuel tanks more than usual, causing sporadic shortages and temporary shutdowns of stations. These closures only magnified the problem, of course, leading to more shortages, which sent local prices skyrocketing.”

“It’s a wonder people didn’t go out and empty all of the grocery store shelves, too,” said Larry Lamb, of Nashville. “All you need to do when something like this happens is just calm down.”

“Perhaps, in hindsight, that is the sensible thing to do.  But economists and other experts say individuals, not just Americans, are hard-wired to respond quickly when they are scared, and in a way that is not always in their own, or their neighbors’, best interests.”

“People are freaking out,” said landscaper Dennis McDonald, 50, after waiting to pump 10 gallons of gas into his pickup in Woodstock, Ga.

“Robert Prechter, a market forecaster and president of The Socionomics Institute in Gainesville, Ga., said in an e-mail that the response in Nashville and other cities to even temporary shortages of gasoline should have been expected.”

“Topping off is simply a rational reaction to disrupted supplies,” he said. “So it is incorrect to charge everyday people with thoughtless herding in this case.”

So the question for the day:  Is topping off the gas tank okay?  Is it a wise move to make sure you or your family have enough gas?  Or is topping off the tank a selfish act that takes away someone else’s ability to drive their car? 

Lets take a poll and see what you think (this poll only works on the SushiMoney.com homepage, not in the feed). Here’s the question:

Is Topping Off the Fuel Tank Smart or Selfish?

• Topping off is smart- it's like planning ahead.
• Topping off is selfish and wrong.
• It's wrong, but I do it anyway!
• None of your business.

View Results

What’s my take?  I’ll be straight up and share my opinion that when fuel supplies are really tight and it’s nearly an emergency situation, I think filling up and topping off the tank is just fine.  Especially if you need it for work, family, travel, etc.  But if you don’t need the fuel then I think it’s a selfish habit.  But could it also be both smart and selfish?  What I mean is that it could be like planning ahead for what you or your family might need, and even though it takes away from someone else, we’re trying to protect our own family’s best interests, and that makes it okay?  The Virtue of Selfishness perhaps, to quote from the Ayn Rand book title.

But I have to wonder, isn’t topping off the fuel tanks sort of like how we accumulate things we need at home?   For example, do we eat all the food in our refrigerator or pantry before buying more?  Do we only keep a few rolls of toilet paper on hand, and risk running out?  No!  Most people have a pantry filled with extra food and extra toilet paper on hand in case they need it (I hate running out of toilet paper). 

Is topping off the fuel tank different?  Why?  I guess for me it’s like planning ahead:  If I know I need to get to work, or take my kids to the doctor, or I live a little farther away than other people, then I want to make sure I have the gas to do what I need. 

But if you don’t agree, and think everyone should use most of the gas they have before topping off, or that they shouldn’t fill up if they don’t really need it, then how does anyone know, or what business is it of others to decide?   For some people the question may become how do we regulate, legislate, or make sure that people are complying with some sort of rationing?  In my view, Yikes! We don’t do that at all.  Can you imagine local government getting involved in how much gas (or food, etc) we can purchase?  If it gets to that point, then we really are reverting to socialism and the nation may be in bigger trouble.

But do you know what’s worse?  We may actually find ourselves in a situation where fuel supplies are in short supply all across the nation.  We may see long lines at gas stations, and we may even see some sort of daily rationing put into practice.  Why?  Because the U.S. simply does not have enough production and supply of gasoline or diesel fuel to support the nation’s needs without depending upon foreign countries that care very little about U.S. economic or national security.

We have placed ourselves in a situation where we depend on fuel supplies that are always very tight, and we depend on the production and delivery of oil from foreign countries.  We literally are sending billions of dollars of American money overseas to these other nations.  That’s why the argument is so heated in terms of U.S. energy independence, and why more and more Americans want our oil companies to produce more oil at home.

Can you imagine what our country could do with billions of dollars each year being spent here in the U.S. for jobs, construction, business, new roads, etc, etc.  We would be doing just fine thank you.  I’m not going to turn this post into a debate of oil versus other energy needs because we need them all.  And hopefully over the next few years our auto manufacturers will develop new and better cars and trucks that use many different forms of propulsion.

But for the next couple of decades at least, we are going to need to use additional sources of oil.  I for one hope that we can bring our dollars back to the shores of the U.S. and increase production of oil and gas here.  A new refinery or two wouldn’t hurt either.  Meanwhile, I’ll continue to keep my fuel tanks topped off.  If we do have a supply disruption and the gas lines start forming? Topping off isn’t really going to matter anyway.  We’re all going to be scrambling for gas.  Have a great day.

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