and for once not the cable companies
A KY tourist trap town got tired of being overcharged for gas (and I’ve been through there, it’s not that much of a tourist trap)- the mayor decides they’re better off doing it themselves, opens up a no-frills gas station with cheaper gas, and outcompetes the businesses while breaking even.
Maybe the gas station owners should try no-frills and cheaper gas themselves? That seems to be what customers want.
The government can’t do anything right!!! Until they do, then it’s totally unfair they can do it so much better, no fair!!
You realize this is a man bites dog story, right?
I see a lot of parallels between this and what is happening with municipal broadband in the US.
We have some very anticompetitive markets that could use some competition from the government. (I do think companies should have redress under Sherman if the municipality or state actively price dumps, but they should be allowed to take short-term losses if it would result in long-term profits)
To be fair (I grew up 30 min. from Somerset) it’s not a tourist trap, it’s a tourist destination because of Lake Cumberland. One of the biggest power boating lakes in the US, I would wager. Gas is the lifeblood of the town, so this is a pretty significant move.
You realize you’re going to die alone and unloved, right? Has your mail-order bride dashed with half yet?
Well, it works for the post office, why not other industries. At least for those industries without any real competition.
You mean the US a Postal Service, which receives zero dollars from the government?
Was the USPS initially funded with private dollars?
It sounds like the gas station is funding on-going operations via revenue, not continued infusions from the government - much like the USPS.
The USPS, like the US Mint, is what they call “self funded”. That is, the they charge for things that roll up to their budget. With the Post Office it’s stamps and postage fees, with the Mint it’s numismatics (though with the Mint there would be a danger of a shortfall being covered by external budget if demand died down).
Govenment: When covens govern.
Yes, I understand. My point was the initial investment to start up the USPS came from the government, just like the gas station. After it began operations it became self-funded, just like the gas station. So legowarrior’s analogy to the USPS is accurate.
It’s not possible for private companies to maintain companies that only “break even.” In that situation the owners (or their capital) are working for nothing. What you guys are praising the mayor in this story for is called predatory pricing, it’s what John D. Rockefeller did (except he did it with his own money, not his commercial rivals’ and neighbors’ money), and it’s illegal in the private sector.
Of course it’s possible for private companies to survive if they’re breaking even. The investors may not be making any money, but the company won’t die. The owners may lobby for changes if they want a profit, but lots of companies survive for decades while only paying expenses like salaries and upkeep without generating excess profit for the owners.
Predatory pricing is defined as being below cost, not break even. And it’s not as illegal as you think it is. If you check the Federal Trade Commissions page on the subject, you have to demonstrate that it’s an intentional strategy to create a monopoly and raise prices.
Er… sure they can, they do it all the time. They can even lose money and people still get paid.
And honestly, I could give a crap if someone isn’t making as much profit as they want off the backs of the common man. I mean I’m sure Big Oil is just going to go out of business because of this and all.
You do realize that your logic makes most of the dotcoms illegal, right? Not only do they not make money, most of them actually lose money.
Only rated half true by PolitiFact.
Basically while not directly funded by the federal government, it has still borrowed billions of dollars from the federal government in recent years in order to cover its budget.
A budget running short because of Congressional mandates requiring funding of pensions far in advance of reason, in a plan designed to deliberately hamstring the USPS budget. Why? To make it so that ‘public’ is seen as wasteful and pursue legislation to encourage more mail to be run by private carriers.
Further any plans to try and make mail deliveries less costly (reducing the number of Saturday deliveries, consolidating routes, etc) are also blocked.
So the loans are forced because of Congressional (Republican) interference.
I could give a crap? But do you? Inquiring minds want to know.
There’s a lot of freedom in not having to turn a profit. That said, if a city wants to set up a gas co-op for the locals, they are free to do so.