It's the most basic of all economic principles ... supply and demand. Generally, when the supply of a consumer good declines, demand increases and the price goes up. In most cases it is cyclical and balances out with a so-called "seller's market," created when demand exceeds the supply. Such is the current situation users of liquid propane find themselves in.
Due to a shortage created in part by a near record-setting cold winter and increased demand because of the cold, LP prices in many areas have more than doubled since the beginning of winter, from less than $3 a gallon just weeks ago to more than $6 in some areas.
The situation prompted Governor Rick Snyder to declare a state of emergency in Michigan in response to the propane problem and Republican congressman Dan Benishek, R-Iron River expressed concern about the impact such a shortage and accompanying price spike will have on consumers in Northern Michigan.
"This shortage and recent spike in propane prices are making it difficult for many who are struggling in this tough economy," Benishek said in a press release.
"The fiercely cold winter we have been having has only made matters worse, especially for the neediest families. And while the reasons for the price increase are complex, I am hopeful that we can work together to help address this issue."
Along those lines, the Congressmen sent a letter to the president asking that his administration ensure adequate emergency contingency funds are available for individuals struggling to pay higher home heating bills.
Benishek asked the president to ensure funds through the Low-Income Home Energy Assistance Program become available during this time.
While we remain guarded when it comes to asking government to intervene in matters of commerce, the current shortage is a matter of public safety. The bitterly cold winter, with daytime highs unable to climb into the plus side of zero have made the need for adequate heating a matter of survival.
We support Congressman Benishek's efforts and urge the president to make those LIHEAP funds available. But helping those in need pay for the fuel is only part of the problem. The LP shortage itself needs to be addressed.
We hope the president and Congress will act promptly to determine what caused this shortage and take the appropriate bi-partisan measures necessary to keep the most vulnerable of our neighbors safe during this extremely cold winter.