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Tuesday, April 29, 2008

Who's Afraid of High Gas Prices?

Wherein the Madville Times tries keep on the sunny side...

AP reports that gas prices top the list of Americans' economic worries. 44% call gas prices a "serious problem." 29% cited getting a good job or a raise, 28% cited health care costs, and 19% cited paying the rent or mortgage.

Truckers are protesting (although most can't afford the extra gas for a convoy to Pierre), candidates are pandering to the quick-fix urge for a gas tax holiday (Obama is still holding out) while Shell Oil enjoys a 25% increase in profits.

I hate seeing those numbers at BP spinning upward as you do, but are rising gas prices really that bad? Consider:
  1. A half-gallon of gas gets Mrs. Madville Times, the progeny, and me to town and back for groceries and such. Current cost: $1.75. Cost to make a similar family errand run around Sioux Falls on the bus: $2.00
  2. At our current consumption rates, our family spends maybe $100 a month on gas. We can probably cut down our use (especially now that better biking weather is here!). We spend $225 on a the highest-deductible plan we can get. We spend $650 a month on a mortgage payment that has no wiggle room.
  3. Cutting the gas tax for the summer would save the typical American a whopping $25-$30.
    And as Obama warns, the oil companies would likely absorb those savings.
  4. High gas prices may promote local economy. Where KOTA News says "Tough economic times hit small towns as hard as large cities," KELO tries to lemonadify those lemons by asking, "Can small towns benefit from tough times?" Instead of driving to Sioux Falls or Rapid City, maybe more small-towners will buy locally and keep their own downtowns alive. Of course, buying locally isn't enough: small towns are still dependent on long-distance trucking to get the goods to their shelves. To really beat high gas prices, we may have to start producing more locally as well: more locally grown food, more locally built furniture, locally made clothes, locally produced fuel (Dakota Ethanol: when will you be opening your own pumps for consumers?), more work by local contractors....
I know, I'm reaching. Energy prices are a problem, and I'm sure I'll be back with more posts griping about them. But high as they are, maybe gas prices still aren't as big a problem as other issues like health care and education whose actual prices aren't displayed on big Shell and BP signs all over town.

Just something to think about as we head for the polls in June and November... on our bicycles!

* * *
Great Mind Synchronicity Update, 10:40: Republic Insider muses similarly this morning on whether rising gas prices are over-hyped.

9 comments:

  1. I for one am sick of seeing high gas prices and they are making me nervous. For those people who live and work locally, not a big deal. For those who want the small town life, but have to commute to a bigger city (ie Sioux Falls), the gas prices really cut into your budget.

    Sure, I could find another job, but it would be difficult for the position and pay I have at my current one. So what's the other alternative, move??? I don't think small towns really want people to move away either. It's a catch 22 no matter what way you look at it.

    The thing that drives me nuts is that the oil companies keep coming up with excuses. First it was the hurricanes that took out oil wells, then it was our oil producing neighbors cutting back on production, then it was because the dollar was week and people were investing in oil. Huh????? I think it's the oil people getting greedy and afraid to let go of record profits. The government does need to step in and help out. They regulate everything else, why not the natural product that our country is so dependent upon?

    ReplyDelete
  2. The oil companies don't set the price per barrel of oil, oil prices are set by the speculators who have gone nuts in their bidding. Mind you the oil companies are not arguing, they are not the ones setting the price of oil.

    I don't mind paying more at the pump if it gets us looking into alternative sources and alternative fuels, but what hurts is the price of diesel and how that trickles throughout.

    Almost everything we buy is shipped via truck to us. When is the last time you saw an orange tree in SD? So the cost of almost everything we buy goes up as fuel costs go up.

    What I would like to see is to remove the tax on diesel for the summer and leave the gas tax alone. The people whose businesses rely on diesel would see a huge help. A few cents a gallon may only save us $30, but to a business that buys tens of thousands of gallons a month, that is a sizable chunk.

    ReplyDelete
  3. So in other words, those people that say "Gas prices will hit a record $4/gallon" should be fired immediately. How can they predict what something is going to be priced at? I wonder if that would work for me... "I predict my wages will be up $2/hour before July." Yeah right.. my boss wouldn't go for that. :-)

    ReplyDelete
  4. Our gas prices are still pretty cheap - we're paying half of what they pay in Europe, f'r instance (and they get better health care!)

    Is your comparison of $1.75 private-vehicle-gas vs $2.00 public-transport fair? You are, I think, calculating that based on the cost of a half-gallon of gas. Not on the cost of the vehicle, insurance, maintenance, parking (if applicable, although I include at/de-tached garages), etc.

    ReplyDelete
  5. Xrad. is right -- cars have all sorts of other costs involved. In the context of this post, consider that gasoline may be one of the lesser of your automotive costs; you're just more aware of gas prices because they're always up on the signs. It's not just gas; it's car culture in general that sucks money out of our wallets.

    ReplyDelete
  6. Here's a thought.. If we can go over and take over a country, overthrow their goverment and get them into the rights of democracy, why can't we overthrow the Oil Czars and liberate the world from the high oil prices?

    :-)

    ReplyDelete
  7. Didn't Putin nationalize the oil companies in Russia? I wonder what their gasoline prices are?

    Incidentally, if I remember my Russian, the man's first name is pronounced "vla-DEE-mir," as in "redeemer."

    Don't ask me to remember any more Russian than that. Aloha!

    ReplyDelete
  8. I thought this was interesting, maybe this might help with future fuel prices:

    http://governor.mt.gov/
    hottopics/faqsynthetic.asp

    ReplyDelete

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