I love reading this article in the Washington Post. It says the price point for Americans thinking rationally is $4/gallon of gas. It states that at $3/gallon people barely noticed. They didn’t change a thing. Suddenly $4/gallon has appeared and things are changing quickly.
Mass transit usage is at a 50 year high. I wonder what happened to all the complaints that there is no mass transit? Or is it more that the inconvience is now worth it? Also I wonder how many more people are carpooling with coworkers or their spouses?
Charles Krauthammer says that everyone loves SUV, but apparently they don’t love it above $4. Also our change from SUV to compacts and hybrids is now making a mockery of Congress’s bill to require a miles per gallon efficiency of all cars. As I posted earlier GM is closing SUV/Truck plant, I’m guessing they are betting that gas is not going down ever.
The author has a point that this price hike was not the US following the lead of every other westernized country and taxing the heck out of gas. NOPE. It’s just the nature of having oil becoming super expensive. There is no way to discount gas prices when oil is $140/barrel. The author suggests we leave $4/gallon as a floor and tax gas so we can reduce payroll taxes. He says that by taxing gas, we’ll keep the money in the US instead of paying the extra abroad. Since gas was $3/gallon a year ago, the extra $1 didn’t go to the US, nope no new laws taxing gas. Instead it just went to the producers abroad.
This extra taxation will decrease demand and cause consumers to become conscious of what they use. Interesting thoughts. I gotta say this is tempting considering how much in debt the US government is, we could use the extra taxes to help reduce the deficit.
I wonder though, will we keep adapting instead to paying more in gas instead of changing our ways? Can Americans really change their habits or will they change their budgets to just afford more gas and still drive more in larger vehicles? Will we start to push for more funding for mass transit and better transportation alternatives in large cities? Or will we make excuses and just cut elsewhere?
6 responses so far ↓
1 tom // Jun 8, 2008 at 5:09 pm
I think we’ll continue to adapt. We can demand that the Goverment changes the tax laws, however the US doesn’t have an energy policy. We have no set direction on energy, which includes gas. Until an energy policy is written and passed, we’ll continue to pass useless bills. For my next vehicle, I was planning on purchasing a full-size truck for it’s utility, but at this point I’ll be purchasing a hybrid or electric vehicle. In the mean time I’ll just be budgeting for increase fuel prices and carpooling whenever possible.
2 LivingAlmostLarge // Jun 8, 2008 at 9:11 pm
I too considered purchasing a larger vehicle. But for now until absolutely necessary it’s on the back burner. Perhaps when necessary we’ll still consider whether a large car is needed? Definitely 4 doors.
3 Mrs. Micah // Jun 9, 2008 at 1:00 am
We’re starting a new carpool tomorrow, but that had less to do with gas prices and more with finding out that we had the same morning commute as our friends.
4 chris // Jun 9, 2008 at 7:12 pm
My guess General Motors agrees with Krauthammer. The big vehicles are dead except for absolute necessity. The downside is depending on their production models, large vehicles may no longer have the scales of economy they once did which would then likely drive up the price.
This is really going to challenge the paradigm of the family that sees the SUV as the minimum acceptable baby mobile.
I wonder if Thornhill’s wife is still pushing for an SUV or would settle for a more modest mini van to move the family around in.
5 LivingAlmostLarge // Jun 10, 2008 at 3:23 pm
I am wondering what it will do to the SUV paradigm as well.
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