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In what other ways can high energy costs be a good thing?
We’ve posted a few times on this topic, most recently about the idiot tax paid by Hummer drivers and anyone who owns stock in the Big 3 automakers. The reverberations of $4/gallon gasoline are incredibly profound, especially for a society that’s built on cheap oil. It’s always been the fourth inalienable right: life, liberty, pursuit of happiness, and cheap oil. Not necessarily in that order.
The New York Times published a story yesterday about how rural America, particularly in the South, is being hardest hit by high gas prices because a much greater proportion of their income goes to fuel.
“Across broad swaths of the South, Southwest and the upper Great Plains, the combination of low incomes, high gas prices and heavy dependence on pickup trucks and vans is putting an even tighter squeeze on family budgets.”
Is this yet another example of how poor, rural whites have shot themselves in the collective foot by voting against their economic self interest? These states voted for Bush in both elections, and one can make a pretty good case that a prolonged war in the Middle East and threats of bombing Iran have been significant factors in driving up the price of oil. The hundreds of billions being spent on that war could have been invested in alternative fuels and mass-transit systems. Congress, which has been controlled by the Republicans for 12 of the past 14 years, could have passed tougher fuel economy standards to reduce demand and encourage manufacturers to provide more efficient cars…and pickup trucks. It’s tough to sympathize with people who consistently vote for politicians who work against their economic wellbeing in every meaningful way, from energy policy to education and healthcare. But there is also some upside.
According to The Times, “People are giving up meat so they can buy fuel.” And, “Local fried chicken restaurants are closing because people are eating out less.” As we know, raising cattle is one of the leading contributors to global warming, and Americans eat far more meat than a healthy diet requires. Not to mention the absurd level of fried food that’s consumed in the South. So this could lead to better health for both rural Americans and the planet.
“Josephine Cage, who fillets fish, said her 30-mile commute from Tchula to Isola in her 1998 Ford Escort four days a week is costing her $200 a month, or nearly 20 percent of her pay. ‘I make it by the grace of God,’ she said, and also by replacing meat at supper with soups and green beans and broccoli.” A helluva lot better than Micky D’s and KFC.
“But across Mississippi and the rural South, little public transit is available and people have no choice but to drive to work. Since jobs are scarce, commutes are frequently 20 miles or more. Many of the vehicles on the roads here are old rundown trucks, some getting 10 or fewer miles to the gallon.”
Actually, there is a choice. One of the great things about pickup trucks is that you can fit a bike or two in the bed. Twenty miles is not that far to ride a bike. It can take up to two hours, depending on the terrain, and the health benefits are tremendous. A decent bike can be purchased for only a few tank’s worth of gas by today’s prices, and a tandem can be especially efficient on flat terrain for bike-pooling.
“The Holmes County government has cut the work week to four days to give workers gasoline relief.” Ostensibly, this gives people more time to spend with their families and recreate…as long as it doesn’t require driving, of course.
Are we being insensitive? Or is this karma working its magic by punishing on the one hand and rewarding with the other?
4 responses so far ↓
1 Joey Lo // Jun 10, 2008 at 2:30 am
Agree with your viewpoint regarding capital reallocation and efficient use of assets. Your post also reminds me of an article I read recently:
http://www.iht.com/articles/2008/05/30/opinion/edbowring.php
“Subsidies also must take at least some of the direct blame for the pollution which shrouds Jakarta, Beijing, Delhi and Kuala Lumpur, and indirect blame for shifting resources away from investment in schools and public health. Subsidized oil, for example, has shifted focus from public transportation to highway construction, with the automobile seen as a mainspring of industrial growth.”
Every coin has two sides. Oil subsides have helped many but have also created additional demand in many countries. Hence, to answer your quesiton on a *related matter*, a cut in subsidies may seem insensitive at first, but it’d help reverse the problematic issues stated throughout.
2 Jason Welker // Jun 10, 2008 at 11:13 pm
What’s insensitive (and insane) is that America has failed to adequately TAX gas, quite the opposite of subsidizing its consumption. The only reason so many Americans are stuck with inefficient gas guzzlers is because they were so used to cheap gas for so long. Many economists have long advocated a higher (at least $1) federal gas tax aimed at weening Americans off the “juice”.
If we’d had a steadily increasing federal gas tax, then the current sudden and violent increases in gas prices could be softened by temporarily lowering the gas tax, slowing the increase in price of gas. Instead, the profits from $4 gas are going to the middle east and corporate America rather than our own government coffers, where it could have been used to subsidize public transportation and alternative fuel sources.
I do think it’s a bit unrealistic to expect Americans used to driving 20 miles to work to suddenly switch to bicycles… higher gas prices are a signal that it’s time to make changes. When those old trucks wear out they’ll be replaced with more efficient vehicles… when it’s time to move, people will choose to live closer to their work. Hopefully, in the long run, when gas prices do stabilize or fall, the government will smarten up and impose a tax that keeps the price at the pump ABOVE $4 and starts generating revenue that can be used to further reduce America’s addiction to oil through smart subsidies of alternative fuels.
3 Energy Complex | Max Gladwell // Jun 23, 2008 at 6:35 pm
[...] continued prosperity, and anything resembling world peace. In other words, everything. The ripple effect of rising gasoline prices is an early warning sign…a shot across our collective bow…and [...]
4 Beware False Prophets: A Global Warming Lesson | Max Gladwell // Jul 27, 2008 at 3:07 pm
[...] The first question for Lyman was concerning a carbon tax on beef. His response was that not only should there be a tax, but we should end excessive farm subsidies. Just as the taxpayer picks up a percentage of every gallon that Exxon sells, we also foot part of the bill for every Big Mac. As with energy, this has a direct impact on the environment, our health, and our economy because the true costs of raising and consuming beef–especially fast-food beef–are not factored into the price. A 99-cent burger should cost five to 10 times as much. Some of that would take the form of a carbon tax (or its methane equivalent), which is politically difficult, but just as much would come from ending corporate welfare, which shouldn’t be difficult at all. When meat becomes more expensive, people will have no choice but to look to cheaper (and healthier) alternatives. We’ve already seen this happen as a result of high gas prices. [...]
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