Tuesday, 24 July 2012

Ten things that are cheaper in the US

This week, Time magazine is running a list of ten things that are cheaper in the United States than in some other countries in the world, to comfort American consumers who are worried at high prices.

The list is written by Brad Tuttle, a writer on economics and finance for Time, and whose main fous has been on local history and and round New York City. His list is:
  1. Petrol
    “Even when one litre of regular petrol passes the $1 mark in the U.S., American drivers still pay less than half of what it costs to fuel up in Europe. Throughout much of Europe, petrol costs the equivalent of $2 or more per litre, due at least partially to high fuel taxes. Lately, Norway has laid claim to pumping the world’s least cheap petrol, generally running over $2.45 per litre. The only time drivers in the U.S. may encounter such prices is when they are charged penalty rates by car-rental agencies when they don’t prepay for gas or fill up the car before returning it.”
  2. Cars
    “The price of a new car in the U.S. may not seem cheap, but at least a basic commuter vehicle is within reach of most Americans with a decent job. This isn’t the case in all countries. According to one bank’s study on international mobility, the operating costs of a typical entry-level car would eat up 95% of a teacher’s annual salary in South Africa and a whopping 122% of a teacher’s annual salary in Brazil. (American teachers aren’t known for being paid particularly well, but just 23% of a typical U.S. educator’s salary could buy a car.) Automotive World reported that a car that sells for about $15,000 in some countries is likely to sell for $33,000 in Brazil, thanks to high taxes, production costs and extraordinarily large profit margins. Meanwhile, car prices are at least 30% less cheap in Australia, compared with the U.S., because of, among other things, the added expense of shipping vehicles to car dealerships Down Under.”
  3. Driving in General
    “Most American drivers shrug off the cost of tolls, parking, vehicle registration, driver’s license, etc. — it’s a pittance compared with the cost of gas, insurance and the automobile itself. In other countries, those everyday expenses can add up in a hurry. A 2011 study listed the most expensive cities for parking a car, and the priciest U.S. metropolis (New York City) wasn’t even in the top 10. The average monthly parking pass costs the most in London (over $1,000), while drivers in Oslo pay the most to park for a single day ($89). Meanwhile, drivers must pay a “congestion charge” in London to the tune of roughly $18 each and every day they tool around the city centre. Skip it and a fine of as much as $190 will be assessed. Milan, Stockholm and Singapore also have congestion charges, which are designed to simultaneously reduce traffic and raise city revenue. Another way Singapore attempts to reduce congestion is by auctioning off driver’s license permits to the highest bidder; the permits, which allow a driver to own and operate a vehicle for 10 years, sold for nearly $87,000 recently.”
  4. Fast Food
    “According to The Economist’s famed Big Mac index, the most expensive spot to chow down at McDonald’s is Switzerland. While a Big Mac costs $4.20, on average, in the U.S., and as little as $2.44 in China, the famous burger runs $6.81 in Switzerland. A fast-food hamburger meal in the city of N‘Djamena, Chad, meanwhile, costs roughly $25. Quick-service pizza can also cost way more outside the U.S. A Pizza Hut pie costs over $27 in Brazil — plus another $19 or so for a 2-L bottle of soda.”
  5. Coffee
    “Tokyo has been named the world’s most expensive city for Americans to work, partially due to extraordinarily high prices for everyday expenses like coffee. A cup of joe costs $8.29 at a coffee shop in Tokyo. That makes the average $20 spent weekly by American workers seem reasonable, or at least less ridiculous. The world’s most expensive coffee, oddly enough, comes from beans excreted by civet “cats” in Indonesia. The beans are referred to as “golden droppings,” and a cup of coffee produced from them costs as much as $100 per cup in specialty caf├ęs.”
  6. Beer
    “Don’t embark on a pub crawl at the top of the world unless you’re prepared to part with a small fortune. A beer served at a typical bar in Greenland costs over $12, and Norway isn’t far behind, with the average pint selling for over $11. Compared with those prices, a beer in a Swedish bar ($8) sounds reasonable — and an average frosty draft in a U.S. tavern sounds downright cheap at $3.”
  7. Jeans
    “Sure, jeans can cost upwards of $300 in the U.S., but that’s only for premium lines that are stitched and, often, ripped, frayed or otherwise distressed for that oh-so-special look that says: “Check me out” I just blew $300 on jeans with holes in them! But the average price paid for a pair of jeans in the U.S. is well under $50. According to a 2010 survey conducted by ShopSmart, women paid $34 per pair on average, and only 1 in 10 has blown $100 or more for a pair of jeans. In Luanda, Angola, however, a pair of jeans typically costs $177. Geneva is another pricey city for blue jeans, with the average pair running $153.”
  8. Movie Tickets
    “The average ticket to the movies in the U.S. crossed the $8 mark not long ago, and by the end of 2012, the average is expected to hit $8.15. That’s the average, mind you. Tickets can cost much more for 3-D and IMAX presentations and simple location: going to the movies in New York City costs about $13, on average. Nonetheless, a movie in the U.S. seems like a bargain compared with Tokyo, where a ticket costs $24. In 2011, a major movie-theater chain in Japan cut ticket prices in order to boost flagging attendance; after slashing prices, admission still cost over $18.”
  9. Internet Access
    “Many Americans are jealous of countries like South Korea, where Internet service is not only much faster but much cheaper than that in the U.S. Nevertheless, be grateful that you don’t live in Turkmenistan, where a telecom with a monopoly on the market was charging over $1,600 per month for unlimited Internet service last year.”
  10. Cigarettes
    “According to TobaccoFreeKids, a pack of cigarettes retails for an average of $5.97 in the U.S. Smoking is an expensive habit, and it’s even more expensive if you live in Ireland, where a black market for cigarettes has been booming thanks to per-pack retail prices in the neighborhood of $11. Another pricey country for cigarettes is New Zealand, where the best-selling brand goes for $11.70, and may cost much more in the future: health officials there are considering the institution of a new pricing system that would result in a pack of cigarettes costing $80 by 2020.”
The list is quite interesting, even if far too many examples are disconcerting to me, especially that the least cheap petrol remains in nations of negligible conservation value whose flora, fauna and soils are a mere ten thousand years old and typically do not last any longer in their present form before huge ice sheets return. Whilst this negligible conservation value also applies to the Midwest and Northeast regions of the United States, these are in fact less cheap than the South and West, which are of moderate conservation value. If we assume conservation value of the US increases with distance from the northeasternmost point, most states whose fuel prices are less cheap the the US average possess no need for high taxes.
With a few very minor exceptions (#7 in Angola and #2 in South Africa) Australia and subequatorial Africa, those regions of highest conservation value and hence ecological living costs, do not figure at all.

There is one surprise: that cars are thirty percent less cheap in Australia than in the United States. I had always assumed Australia has had since the Howard years absolutely the cheapest cars in the world, but this is not the case. There may be problems with this finding because American manufacturers have rarely been interested in exporting to Australia (due to the high cost of converting to right-hand-drive) but I had always assumed American excise tax on cars affected prices enough to make them not that different from other Enriched World nations. I made an attempt to look at relative car prices for a wide variety of countries, but few data exist outside the European Union. Still, apart from far too many of the highest taxes being in the low-value, glaciated “upper” Enriched World and the remainder generally being in areas under political turmoil, the list should be instructive in both a positive and negative manner.

1 comment:

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