“Oh what a tangled web we create,
When first we practise to regulate.”
In his fortnightly column in the Halifax Chronicle-Herald, Brian Lee Crowley uses that twist on Sir Walter Scott’s famous quotation to show how Nova Scotia’s attempt to re-regulate gasoline to lower prices, will actually result in higher prices. Crowley follows the tale that began with consumer outrage, moved to consumer indifference, was picked up by opportunistic retailers, and was turned from an attempt to lower prices into a plan to increase prices. Crowley writes:
“Regulation is often based on the idea that government can reach into complicated social, economic and business relationships and change just one thing, leaving all the rest as it was. But it just ain’t so, as the strange tale of gasoline price regulation in Nova Scotia illustrates.
After many years of regulating gasoline prices, the province succumbed to the evidence: regulation doesn’t save consumers money – it costs them. Why? Because prices move up and down faster in the marketplace than regulators can hope to do. Regulated prices may be slower to rise, but they are also slower to fall. Take out gasoline taxes, which are quite different in PEI than Nova Scotia, for example, and what do you see? Over time, price-regulated Islanders pay more than a cent a litre more for their gasoline, on average, than unregulated Nova Scotians.
Yet the Hamm government, given the weakness of its position in our minority legislature, is about to force Nova Scotians to pay higher prices for gasoline. Yes, you read that right. They are about to re-regulate gasoline prices, a move that the Premier has himself admitted will cause Nova Scotians to pay more.
This outcome is the misbegotten offspring of cheap populism sired by shameless opportunism.”
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