What is Digg?254 Comments
- manoftheisland, on 10/12/2007, -12/+193gotta love government!!!!!
- giid, on 10/12/2007, -17/+143I, for one, would welcome mega-large chain overloards with cheap prices.
- moondog, on 10/12/2007, -11/+126Someone tries to do something noble like offering discounts to Senior citizens or people that support youth sports and gets nailed for it...sounds like Wisconsin leadership needs to change some laws, if not then Wisconsin voters need to change some leadership.
- doctorcaligari, on 10/12/2007, -1/+100FTA: "Bhandari, who bought the station a year ago, said he worries customers will think he stopped the discounts because he wants to make more money."
Here is how he can notify customers: Tape a sign to each gas pump that says "Our state government won't let me sell cheaper gas. Please vote accordingly." - aliengoods, on 10/12/2007, -30/+107Actually, the law makes sense. It's intended to prevent the mega-large chains from lowering prices to drive the independents out of business. That being said, there is no way the government will try to crack down on this guy. He may pay a small fine, but there would be too much negative press generated if they tried to make an example out of him. Trust me.
I live in Wisconsin and EVERYONE is pissed about the current and coming gas prices. I would guess that gas prices are of higher importance than the war in Iraq. - dasilva333, on 10/12/2007, -5/+71wait so the
Wisconsin's Unfair Sales Act, which requires stations to sell gas for about 9.2 percent more than the wholesale price.
makes gas more expensive by nature, so its unfair to sell it at cost? how does that even make sesne? This must be a wisconsin thing bc everyone dose it, with a membership card to Dillons or any big chain you can get discounts (i get 10 cents off) - mdfrake, on 10/12/2007, -6/+70Yeah, thank god he didn't try to help out the handicap and homeless, then he'd really be screwed. Nice, real nice.
Also, who the hell thought it would be a good idea to enforce a 9.2% profit margin on gas? So much for free market competition. - JohnGalt01, on 10/12/2007, -16/+79Wisconsin is one of the most socialist states in the country. This is the result of government trying to control the free market.
- dpb33300, on 10/12/2007, -6/+66@aliengoods. How does this make sense? If someone comes up with a cheaper way of selling gas at a discount price to help the consumers, you think that business should be taxed?
We are moving farther and farther away from a free capitalist market. What ever happened to survival of the fittest? - 1021, on 10/12/2007, -7/+58"here! here!" => wrong
"hear! hear!" => right - krische, on 10/12/2007, -1/+29@whickywhickyjim
yes, we all live on farms. We only go to school till first grade. Then once we learn how to milk a cow, school is useless. Sometimes for fun, we run around and throw cow pies (thats their ***** for you city folk) at each other. Man, good times.
/sarcasm - hipnerd, on 10/12/2007, -11/+36That's basically it. These laws are designed to stop predatory pricing. They were having scenarios where Shell or Exxon would move in and sell gasoline at a loss until they drove all the competition out of business, then they would raise prices through the roof because they were the only game in town.
That isn't a hypothetical scenario, that was a business strategy adopted by the major oil companies. So most states passed laws stating that you couldn't sell gas less than 10 percent above wholesale or something like that.
You're seeing the unintended consequence of that law, and it looks silly; but you do have to remember why the law was created in the first place. It was to prevent large companies from using predatory pricing to destroy competition in the marketplace. - geekee, on 10/12/2007, -3/+26FTA
"But the state Department of Agriculture, Trade and Consumer Protection says those deals violate Wisconsin's Unfair Sales Act, which requires stations to sell gas for about 9.2 percent more than the wholesale price."
The article backs up your claim, although I'm pretty sure all states do something like this. - cheddarlump, on 10/12/2007, -4/+26If you think this is bad, wait and see what happens if Hillary takes office..
“The other day the oil companies reported the highest profits in the history of the world. I want to take those profits and I want to put them into a strategic energy fund that will begin to fund alternative smart energy alternatives and technologies that will begin to actually move us toward the direction of independence…” -Hillary Clinton
Step 1: Mandate profit % to be made
Step 2: Tax ~45c / gallon
Step 3: Tax corporations for making mandated profit
Step 4: Take mandated profit from corporations after taking taxes too.
Step 5: Create government program to develop alternative tech.
Set 'em up and knock 'em down. Can't wait to see the health-care plan.. :) - killinger777, on 10/12/2007, -7/+29Aliengoods, you're pissed about the rising gas prices, yet you oppose competition which drives the prices down?
- GMorgan, on 10/12/2007, -2/+23Predatory pricing is largely a discredited idea. For it to work you have to destroy all competition. Not even the 65% or so that Standard Oil had would be enough to gain success.
Put simply for it to work a corporation needs to be able to charge ridiculously high prices for an extended period. Unless it owns 99% of the market it cannot do this. Such market shares would be impossible. Nobody is going to sell off their oil to you if you engage in predatory practices since they can benefit from the rise as much as you. Any moderately sized oil company could mothball most of their operations and wait until the aggression runs its course then return to the market in a strong position.
Essentially it is an insane idea and no serious corporation has ever done this since it's a way to bankruptcy.
It's merely an excuse for government to run the economy. - killinger777, on 10/12/2007, -3/+24nice try Grummond... Wisconsin is primarily run by Dems.
- MaynardJK, on 10/12/2007, -2/+22People that bitch about the high price of gas and oil company profits need to take a look at who REALLY profits from these prices. It is the federal and state governments keeping it so high with ridiculous taxes.
http://www.gaspricewatch.com/usgastaxes.asp
Oil companies get 10 cents a gallon or so
State Governments get 8-35 cents plus sales tax in some cases
Fed gets 18.4 cents per gallon - tgpuckett, on 10/12/2007, -14/+34This is to try to make prices equal among gas stations...it's intended so huge gas stations like Exxon can't sell gas at a steep discount to force other companies out of business. Apparently these kinds of laws only exist with gas...wal-mart is immune selling dvds for $12-17 while best buy, etc sell them for upwards of $20-25
- inactive, on 10/12/2007, -3/+23Department of Commerce - Wisconsin
(608) 266-1018
Call them and tell them what you think - inactive, on 10/12/2007, -9/+29i live in wisconsin !!!!!!!!!!!!!!!!!!!!!!!
gas is expensive i live in a podunk down of 700 gas is $3.18 a gallon right accross the border 20 mins in Iowa its $3.02 - chronichyjinx, on 10/12/2007, -8/+27Bunch of pricks... Let the guy do what he wants with his business! He's the one loosing the money out of his own pocket!
- Charles07v, on 10/12/2007, -3/+20"Predatory pricing", as you defined it, is a myth. Companies may move in and sell cheaper, yes. But if they "raise the prices through the roof" later, then other companies would move in to undersell them. So they have to keep their prices reasonably low even after other companies are gone.
Edit: see above as well - prattboy, on 10/12/2007, -3/+19I used to work at a convenience store in Wisconsin but have since moved to Indiana. As many have mentioned, this price "fixing" is to prevent the larger chains from knocking the smaller chains out of business by severely undercutting the prices of the mom n' pop shops. In Wisconsin you are not allowed to advertise gas prices except on the sign outside your gas station or to offer a discount on the gas itself. However, you can sometimes offer discounted goods when gas is purchased, depending on how the promotion is advertised. If a competing gas station lowers their price, other gas stations may be able to lower their price, even if it's below the legally mandated markup, providing they have documented the price the other gas station is selling the gas at and when they change it. The state is unlikely to investigate a price that's too low unless other gas stations in the area complain of unfair pricing practices and have consistent documentation of prices that are below what the state deems acceptable.
The exception to this rule is a gas station run by an Indian tribe on a reservation. They are not bound by the same state and federal laws, so they can essentially price gas at whatever price they see fit and advertise it in any manner they wish.
Ultimately, though, convenience stores don't make money off of fuel. They make it from all the stuff sold inside the store and additional service they provide, such as car washes.
This seems like a case of choosing your own poison. Don't regulate prices and have a choice between the big chains... or regulate prices and have artificial competition between the big chains and the mom n' pops. - inactive, on 10/12/2007, -12/+28"@aliengoods. How does this make sense? If someone comes up with a cheaper way of selling gas at a discount price to help the consumers, you think that business should be taxed?"
After they kill the smaller gas stations, they will raise their prices higher than they ever were before. No one will open up independent stores after this, because they know the chains will just lower their prices again -- rinse and repeat.
Although, that system could drive innovation. The little guys would have to come up with new, radical ways of serving gasoline to match prices, etc. - AriaStar, on 10/12/2007, -9/+24The minimum price of milk has been set by the government, so I'm not surprised about gas.
Has anyone noticed how minimum prices are set for things, and that the minimum prices go up, yet they won't cap prices or raise the minimum wage? Seems to me that they are TRYING to create poverty. - 1021, on 10/12/2007, -4/+18from comment below "Let the guy do what he wants with his business!"
If you support Laissez-faire type governments, which don't tend to be democrats in the local elections, then this guy probably wouldn't get a law notice telling him how to run his business.
Just the truth. Digging it down doesn't make it any less true. - inactive, on 10/12/2007, -4/+18More info from the FTC.
http://www.ftc.gov/be/v030015.shtm - DRINKxREDxBULL, on 10/12/2007, -2/+16MN has the same law. When Hike Hatch was the state's Attorney General, he was threatening several business for selling gas to low.
- Mosatii, on 10/12/2007, -2/+16@mesostinky
"Normal American: "Gee, how convenient that oil always cost more right when we need it.""
Which is exactly why the gas prices increase. Demand increases. - nick2, on 10/12/2007, -6/+19I live in Wisconsin and the prices are too high as it is.
- mousky, on 10/12/2007, -3/+14"@gregharmon: After they kill the smaller gas stations, they will raise their prices higher than they ever were before. No one will open up independent stores after this, because they know the chains will just lower their prices again -- rinse and repeat."
There would still be competition between the majors. In my town, Wal-Mart and Zehrs (a division of Canadian grocer Loblaws) have gas pumps across the street from each other. They are always trying to out do each other and the other major gas stations down the street. - dpb33300, on 10/12/2007, -3/+14@ramble, yeah like government will give money back to the citizens. I'd like to get a piece of what you are smoking.
- c0y0t3, on 10/12/2007, -8/+18The market should control the gas prices, not the government. ANY deviation from this causes harm in an otherwise free market system, period.
If Mom and Pop can't match Mega Corps prices, Mom and Pop shouldn't be selling gasoline. Sorry. - Dustin00, on 10/12/2007, -4/+13Speaking as a consumer, I feel protected now!
- catalysis, on 10/12/2007, -2/+11"The big company would then jack up their prices thanks to supply and demand. Go back to economics."
Then little companies would come back and undercut the big company before it has a chance to recover its losses. Econ 101 Predatory pricing doesn't work in practice. Why do you think Walmart doesn't raise its prices? - deathianity, on 10/12/2007, -7/+16I can understand the position of the government saying he has to make it equal because of a law but it this is screwed up. The guy that owns the place could offer so much profit or just a basic donation to the youth sports but this is still retarded.
- AJH16, on 10/12/2007, -5/+13Best Buy just chooses to rip the consumer off. There are places you can get DVDs cheaper than at WalMart.
- JK1150, on 10/12/2007, -5/+13Democrat Governor...
- c0y0t3, on 10/12/2007, -1/+9Then the federal law shouldn't exist either. Its not knee-jerk, its simple common sense: a free market should be free from intervention by any level of government insofar as allowing the market to control the prices on its own. Anything artificial added to that hurts someone, in this case, the consumer AND the business owner. If he wants to sell gas below cost, to get people to come to his store and buy slurpies, for example, he should absolutely be able to do it.
- Greenleif, on 10/12/2007, -6/+13It's his business, not the governments. He's making less than the 9.2% margin because he cares about something other than just raping us at the pump, and BAM lawsuit. WTF.
- LeberMac, on 10/12/2007, -1/+8Yeah, and at the same time our illustrious Wisconsin Governor "Diamond" Jim Doyle wants to levy a special "windfall profits" tax against JUST the oil companies, and also install a special state office to ensure that those higher costs of doing business are somehow not passed along to the consumer. We're not too far from "nationalizing" the oil companies, it seems.
Make up yer mind already, Doyle. - gall0249, on 10/12/2007, -1/+8Compared to Minnesota, Wisconsin gas prices are typically $0.15 to $0.20 more per gallon. Though MN has one of the smallest gas taxes in the nation. I was born and raised in Wisconsin and sadly this is not the first time I heard of a gas stating in WI being threatened by the gov because of pricing too low. When Bush began invading Iraq, most stations were increasing gas prices drastically. But 1 or 2 stations in the area would sell gas for 99cents for an hour unknowingly to the customers. The GOV didn't like that at all. The mandatory government 9.2% markup needs to stop.
- mabhatter, on 10/12/2007, -1/+8It's a fair trade law from the Standard Oil days when Standard Oil was just like Wal*mart is now... swooping into town to drive out competition with outrageously low prices from extra high prices elsewhere... or is that more like Microsoft?
Anyway, putting a % cap is fine and all, but when prices rise at double-digit rates, maintaining the profit as percent is silly (from a customer's pov) or great (from a company). While most of the country's retailers are taking a beating with only a few cents profit per gallon when it goes up or down... these guys get proportionate profit as the price goes UP!!! There's no incentive to keep prices down.. for the owner to make up the difference even though they're being gouged. After all, in most of the country it takes a minimum number of pennies per gallon to keep prices when prices go up, the retailers are squeezed.. over there, when the price of gas nearly doubles like it just did in the last month, that's pure profit. WOW, I can see why other companies would squeal!!!
The law needs to be changed because it's wholesalers and other middlemen fixing these high prices, not retailers. - DRINKxREDxBULL, on 10/12/2007, -4/+11"If Mom and Pop can't match Mega Corps prices, Mom and Pop shouldn't be selling gasoline. Sorry"
Exactly. If you love Mom and Pop so much, send them YOUR money. - Salgat, on 10/12/2007, -1/+8Then we have an issue with the law..duh.
- eqisow, on 10/12/2007, -2/+8@ MaynardJK
I logged in just to digg you up - jeffiek, on 10/12/2007, -1/+7"The big company would then jack up their prices thanks to supply and demand."
Show an example of when this has EVER happened. - spyrochaete, on 10/12/2007, -2/+8I think MaynardJK hit the bullseye on this one. It's the same thing with nicotine. Poison the populace with unhealthy products to reap the benefits of antiquated taxation, yet the resulting problems introduced by these taxes cost taxpayers fiftyfold. Penny wise, pound foolish.
- 1021, on 10/12/2007, -2/+8@spyro
Read about what I speak of and it's history and which schools of thought truly support it and you will know what the correlation is. What I speak of is the perspective in politics that states that government needs to stay out of private industry. Profit margins and economics within do not need to be politicized, that is the point of Laissez Faire, classic liberalism.
http://en.wikipedia.org/wiki/Laissez-faire -
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