Price Sells Cars, Debt Sells Education

From the Roth & Company Tax Update blog:

Don't Mess With Taxes brings us a shocking story: the elimination of the tax credit for Toyota hybrid cars has reduced demand for the Prius. As a result, prices are coming down!

This could lead to a radical new approach to pricing hybrid cars: setting the price at what people will pay for them. It's a bitter pill, but desperate times are leading Toyota to desperate measures.

Sellers of other subsidized products should watch this development closely...

...This theory could also apply to the higher education industry. It appears to the untrained eye that every initiative to make college "more affordable" was immediately absorbed by higher tuition prices. Maybe someday we'll find out if the ultimate way to make college more affordable is to eliminate the rat's nest of tax credits, deductions and tuition subsidies for the college industry.

I saw a story on the evening snooze the other night about how Priuses aren't selling and Toyota is using discounts and cheap leases in order to entice buyers. I guess the general population has finally figured out that it's stupid to spend $20,000 in order to save $226 a year.

Don't forget that the EPA will soon be revising the Prius's mileage amounts. Originally rated at 60 city and 51 highway, many people found themselves getting only 34 mpg.

Along the same lines with higher education, what would happen if a doctor's office only accepted cash? Even better, what if the doctor's office posted their "menu" of prices outside or on the web? Would the lower overhead of not having to send and re-send claims to insurance companies, manage co-pays, and deal with paperwork affect prices? Surely, it would.