Gas Prices Begin to Weigh Down, Anger Consumers
March 24th, 2007 | by Brian Carr |With gas prices up nearly 22% since the end of January - and many places through out the United States averaging prices over $3 per gallon - it appears that the average American consumer is both concerned and angered at the pretty dramatic increase in the cost of filling their vehicle’s tank.
Unfortunately, it looks like these higher gas prices are coming at a bad time for our economy. According to Investor’s Business Daily, with our slowing economy, suspect housing market and an even more suspect stock market, a continued steep increase in gasoline prices could have a very dramatic impact on our buying habits.
Considering inflation is one of the key points of concern for the Federal Reserve, higher gas prices have to be causing a lot of angst among the Fed members. Not to mention the fact that if gas prices have a dramatic impact on our buying habits and purchasing power, we’re looking at all aspects of the economy taking a huge hit - unemployment will skyrocket, inflation will run amok, interest rates will continue to increase, etc.
Essentially, we could be looking at the mid to late 1970s again.
According to an article published on InsideBayArea.com, people are becoming more and more upset with rising gas prices because they feel that there’s not a light at the end of the tunnel and gas prices will continue to climb higher and higher.
But, instead of just complaining about gas prices, the author of the InsideBayArea.com article poses a very interesting and viable solution:
“Treat oil companies like utilities, form a state commission and force these firms to justify dramatic increases in their rates. We need a better way to understand and determine why gas prices are rising and to protect consumers.”
While this makes sense due to the fact oil and gasoline companies play just as large of a role in our lives as companies that provide electric, natural gas, telephone and cable services, it seems that forming state commissions to regulate gas prices is pretty unlikely.
Unfortunately, I disagree with the rest of the article’s implied stance that higher gas prices can be solely blamed on the big oil and gasoline companies. While these companies are responsible for setting the prices, it doesn’t mean that consumers have to buy the gasoline.
What I mean by that is if there wasn’t a demand for gasoline at $4 per gallon, gas prices would never get that high. If people would drive less, use public transportation more, walk or ride a bike, drive more fuel efficient vehicles, etc., and the demand for gasoline dropped, amazing, so too would the price.
However, if we continue to guzzle gas, thanks to our free market economy, gas prices will continue to climb. So let’s not lay this problem at the feet of Big Oil without taking a good hard look in the mirror.
17 Responses to “Gas Prices Begin to Weigh Down, Anger Consumers”
By ~Dawn on Mar 24, 2007 | Reply
I am doing something..
I am riding my scooter more this year than last. Now if I can only get over the fear of riding in the rain.
By Brian Carr on Mar 24, 2007 | Reply
Dawn - thanks for the comment and good for you for changing your driving habits. By the way, I’ve been a big fan of your site for quite some time. Keep up the good work!
By tom rogers on Mar 24, 2007 | Reply
Spot on, Sir. Blame can be spread around and around, when it’s all said and done, we are our own worst enemy.
By Brian Carr on Mar 24, 2007 | Reply
Tom - thanks for the comment. My fear is that we will continue to place both high gas prices and environmental problems at the feet of “Big Oil” and not take any sort of personal responsibility for what we’ve done to make the situation worse. If each of us would step up and try our best to reduce our carbon footprint - whether it’s through increase recycling, getting better gas mileage, or turning off the lights when we leave a room - I think the world would be a much cleaner place.
By Delivery Driver on Mar 25, 2007 | Reply
Sooo, ummm. I’m a delivery driver. I’m already driving the most fuel effecient car that is reasonably priced (based on my salary). I get raped over the coals every summer because of Oil companies.
By Manu Sharma on Mar 25, 2007 | Reply
I don’t know what you Americans keep complaining about, you still have it way cheaper than us in India.
The price here @ Rs.44 / liter comes to $3.82 / US Gallon. The last time I checked India’s GDP per capita $705 was a tiny fraction of the corresponding figure for US - $42,000.
This never stopped the growth of Automobiles in India. The number of cars in Delhi, the city I live in, has quadrupled in the last decade.
So who’s paying more? Who has more money? And who’s complaining?
By Brian Carr on Mar 25, 2007 | Reply
Delivery Driver - thanks for the comment. You do bring up a very valid point; people who rely on their vehicles for a living (pizza delivery, truckers, etc.) do get hit pretty hard as gas prices go up.
By Brian Carr on Mar 25, 2007 | Reply
Manu - thanks for the comment. I think that it’s the percentage increase and not the actual price that’s causing all of the fuss. If the price of anything rises 22% in a little over a month I think the natural human instict - whether you’re from America or India - is to complain about it.
By Manu Sharma on Mar 25, 2007 | Reply
> it’s the percentage increase nd not the actual price that’s causing all of the fuss.
Agreed but given the huge disparity in earnings of an average American and an urban Indian the price appears, at least to our eyes, ridiculously affordable for you.
I mean, if the price of gasoline went down to $3 / gallon (Rs.34/litre) here in India - we’d be CELEBRATING. It’s very hard for me to understand that this is a cause of concern for you when I know that on both sides of the world we get to drive similar cars and similar distances.
By Brian Carr on Mar 25, 2007 | Reply
Manu - I don’t disagree. Considering the wide gap in incomes, I’m sure $3 over here is a lot more affordable than $3 over there.
By Karine on Mar 26, 2007 | Reply
…but I’m sure in India you’re not also paying the housing costs that we are. The average house now, depending upon where you live is around $300,000 and that’s not even a really nice house. Rent in NY, again depending upon your locale can be anywhere from $1,200 to $3,000 a month or more. If you’re on the low-end of the rent scale you’re probably driving ALOT which by the way I am. I drive 100 miles a day, 5 days a week and not for the pleasure of it. I have the most economical car on the market aside from hybrids which I can’t afford. I would love to work closer to home but then I’d have to expect a cut in my salary by about 1/2 what it currently is which I’m barely making ends meet on. Many people in the US are surviving on alot less than $40k a year by the way. I know people who are living on $30k. Granted that may sound like alot of money but you have to look at all the other costs; rent, utilities, car payments, etc. I know I don’t have alot of extras. I just think it’s all relative and I do think the industry should be regulated. Since the same industry that is raping us is also the same industry that has lobbies in Washington to keep out alternative fuel sources. I mean give me a break. Yeah I believe to a certain extent we can blame ourselves but to just say “oh, it’s the consumers fault” is just as ignorant. As a country we haven’t done very much to make mass transit just that, “mass”. Many locations do not have access to any type of mass transit. I think the issue is a complex one but it also points to the way we are as a people. It’s all about instant gratification. You can’t just look at one part of the equation without looking at everything which most people really do not want to do.
By Manu Sharma on Mar 26, 2007 | Reply
You’d be surprised to know the housing costs in India so let’s not even go there. =) Rest assured that in the big cities it’s more expensive than in US.
Btw I just learned yesterday that the price of gasoline is $7 per gallon in Europe. Enough said.
By Fuel Additive on Mar 26, 2007 | Reply
The way I look at it, people always get upset whenever there is a change to their life that they either didn’t see coming or can’t understand. To most of us the gas/oil industry is all a complete mystery. Its hard to connect the dots sometimes between what the news says is causing the increases and what is really going on. Sometimes you have to wonder if anyone really knows…
By Brian Carr on Mar 26, 2007 | Reply
Karine and Manu - I think the moral of the story is the world is getting smaller and everything is going to continue to become more expensive.
By Brian Carr on Mar 26, 2007 | Reply
Fuel Additive - that’s a good point. I think if there was a little more transparency in to why gas prices seemingly fluctuate for no apparent reason, maybe we’d all be a little more tolerant.
By Chris from Sacramento on Apr 9, 2007 | Reply
It is hard for a species to come to terms with the human sprawl concept, and the huge temptation by those trying to rape the populations to charge very large margins for profitering purposes. There really is enough for everyone, but the few who have the power have learned that humans are very pacifistic and there are ways to slide things right by us.
I have yet to see a petroleum tycoon cry for the consumer. We live in a world where the system of creating wealth has taken over the political system that is supposed to bring balance. The only thing we have is hope for the folks in power to finally make ENOUGH to begin to feel compassion for the rest of us and share the wealth. This would of course be disasterous for their fleecing of the human sprawl and their profit margins, so I would not count on it. Especially since they realize that our political system cannot protect us anymore by providing consequence for their actions. Absolute Power means no consequences in this case by creating the perfect crime through vague accountability via economic complexity beyond average human comprehension.
If you need to blame some, you only need look in a mirror.. and say “Mooo!”
By Manu Sharma on Apr 23, 2007 | Reply
Finally, someone gets it…
“The Problem? Gasoline is Basically Free”
http://www.treehugger.com/files/2007/04/the_problem_gas.php