A computer glitch that dramatically lowered the price at the pump to one-tenth its value gave NBC’s Brian Williams an excuse to launch into a populist anti-oil industry diatribe.
Noting that the price for mid-grade unleaded at “the Charles Street Stop-and-Go in Rockford, Illinois” was supposed to be $3.09 a gallon, the New Jersey native explained that a “computer glitch somehow moved the decimal point on the price one place to the left,” charging motorists only 30 cents a gallon.
“The pumps were quickly shut down amid fears that oil company profits might plummet,” Williams quipped, before taking another swipe at gas prices. “For one brief, shining moment, we the consumers won. It was like the old days before you needed to refinance your home to refill your tank.”
Williams ended the item there, allowing no rebuttal from anyone who would explain the market forces governing the price of gasoline or that when adjusted for inflation and income, gasoline in “the old days” wasn’t all that cheap.
In June, the Cato Institute’s Jerry Taylor noted that in 1955, gasoline “sold for 29 cents per gallon,” but adjusted for inflation, would “have cost $1.76 per gallon” and factoring in “disposable per capita income (defined as income minus taxes), gasoline today would have to cost $5.17 per gallon to have the same impact as 29 cents in 1955.”
Another practical, less “sinister” reason Williams left out as to why the Rockford gas station had an interest in quickly fixing the computer glitch: an artificially low price could have led to major headaches for the gas station and local law enforcement.
Just ask the people of Milwaukee, Wis.
It was there in July that a gas giveaway gimmick by Allstate (NYSE: ALL) insurance led to “hundreds of drivers” waiting for a free 10-gallon fill-up. “The line, two miles long, spilled into a residential neighborhood, stranding some homeowners in their driveways when they needed to get to work,” reported the Chicago Tribune’s Becky Yerak.
The Tribune reporter also noted that “two fender-benders,” four disorderly conduct arrests, and three policemen sent to the hospital “after getting splattered by one person’s bloody nose” were among the unintended consequences of the free gas publicity stunt.
What’s more, “Allstate isn’t the first financial-services business to sponsor a gas giveaway that will live in infamy,” Yerak added in her July 14 article, recalling a February 2005 “Charter One Bank gas giveaway in Ohio” that “resulted in traffic snarls and finger-pointing” and an April 2005 giveaway by Chase bank “that caused gridlock on four main Lexington, Ky., roads,” according to the Lexington Herald Leader.