You've wondered about the price of tea in China, but what about the price of gas here?

Another way to get people to drive is less is to raise the price of gasoline. According to one of my Chinese colleagues at work, she is paying 6.24 RMB per liter of 93 octane gas. This works out to $3.47 a gallon at today's (11/17) 6.83 RMB for $1 currency exchange rate. It also about matches a figure a saw cited on a CNN story I shagged on the internet, which stated that motorists are charged $3.24 for a gallon of gas here.

Thus gas prices here exceed somewhat those in the US. The latest check on the internet reveals that they're back down to well under $3 a gallon, due no doubt to sharply falling crude prices brought by the current global economic slump. However, Chinese gas prices are nowhere near what motorists in Europe pay for fuel. Due to heavy gas taxes, drivers in Britain, Belgium, and the Netherlands, drivers pay from $8-10 for a gallon of gas. No wonder European motorists drive more fuel efficient cars and make greater use of public transportation!

But the Middle Kingdom is nudging in the right direction. Fuel taxes have been recently boosted, which is why gas prices have risen from under $3 a gallon to their current level. One does have to commend the government here for taking such steps, which are naturally not very popular.

We'll see if Obama and the Democrats can show the same kind of political courage. As any economist will tell you, a carbon tax is the best way to reduce oil consumption and all the bad externalities that go with, most notably air pollution and global climate change. It's certainly much simpler and more workable than a cap-and-trade system. And America will have hard time telling China to take serious measures to address this crisis if it continues to delay getting its own house in order.