Petrol prices are at a record high. The average Australian car needs at least 80 bucks a tank. The bigger 4WD are much more. It is getting way out of hand and there is no relief in sight. They will never, ever come back down.
Coupled with the rise in interest rates this past week in Australia, this is really hurting many. The discount dockets do not help, becuase Coles and Safeway/Woolworths are putting up prices to cover the discount. But it doesn't stop there, since petrol is used in nearly every production process and especially in transportation the prices of most other things are rising as well leading to a high level of cost inflation. Its pretty bleak.
So should the government step in and subsidise petrol, or charge less tax on it? And would this even help? I remember an economics teacher telling me that to wipe one cent off petrol prices will cost the government millions if not billions of dollars.
Another factor is the environmental factor. Quite honestly, there is too much driving going on and we don't want the world to be covered in smog. Cars have become so cheap that there are on average 3 per family IRC. The air is getting worse and worse. I have recently been to Hong Kong and New Zealand and I know which one I would rather live in.
So its my opinion that the government should subsidise programs for Prius like cars, that dont need petrol and protect the environment at the same time. Seems like the best solution to me.