Oil prices, carriers and the Spanish government

The recent increase in oil prices affects all transport. Air, ground and sea transportation, passenger and cargo alike, have seen their costs rising in the last few months.

Analysts have provided several theories on the causes behind the oil price hike. Some put the blame on the credit crisis in the USA, others blame oil producers, others point at the US Federal Reserve, and others remind us of the significant increase in energy demand. I am not going to analyze the reasons here.

This week Spain saw a strike by some truck drivers (apparently about 20% of them), demanding Government intervention to help their activity, after fuel price increases are rendering their business a loss-making operation. Their strike blocked major communication roads around the main cities in Spain, causing long traffic jams, and making it impossible for loads of other people to carry on with their own jobs.

These few truck drivers seem to think they are the only ones affected by oil prices. Many other people actually need gas fuel as well to drive to work, and are equally paying for gas at the same price. Costs are increasing for everyone.

Private businesses, such as the truck drivers’ own job, must not receive help from the Government. When faced with adversity, these striker drivers resort to demanding help from the Government while showing complete disregard to other workers and people through their road-blocking actions, and through their boycotting other truck drivers who chose not to adhere to the protest. The striker’s lazy and cowardly attitude towards their own problems is unacceptable. Clearly the transportation business was profitable when they decided to enter the business. Now that conditions have changed for the worse, they expect external help instead of adapting themselves to the new circumstances.

I know ex-truck drivers who left the business because they could not make a living with it, and moved to another type of job. People in other sectors, including house service, agriculture, engineering, and financial services, to name a few, have the personal drive to move forward through trouble, to adapt and adjust by changing jobs if needed. The few who are unwilling to adjust are usually (also on this occasion) the noisiest, but this is no reason to listen to them.

The natural solution to the carriers’ problems is simply to increase their transportation fees as a result of their increased cost. If their fees are fixed by collective agreements, then they must renegotiate if they wish, but Government intervention is not be to asked for, and public funds must not be used to help this or any other private sector.

If prices of goods must increase as a consequence of higher transportation costs, so be it. It’s only natural. To intervene on pricing, on the other hand, would be wrong. The Government must attack the problem at its root: supply and demand of energy. If they cannot affect demand, then they must act on supply, building new energy-producing plants. Spain’s proud and capricious socialist Government, of course, has no plans for this.

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