Tales From The Travels

My son asked me last fall when I thought gas would hit $4 a gallon. I told him that it would happen before summer. This was a bit of a stretch because gas was about $3/gallon at the time, but I was pretty confident in my prediction. Well, I paid $4/gallon for regular gas yesterday. I had more than two weeks to spare in my prediction.

Now, I understand that people in other countries and even people in California and Hawaii have been paying more than that for a long time, but this still represents how gas prices have been soaring over the last few years. I don’t like paying the extra money any more than anyone else, but I still have a different view on the matter. We have had this warning since the fall of 1973 that we are dependent on oil being supplied to us by foreign nations that are not friendly to us. And, we have been shipping out massive amounts of national wealth to those countries to pay for our habits. Yet, we have done nothing to change that. In fact, we continually make decisions to increase our dependence. Look at some of the things we have done.

We have increased the size of cars and trucks. The average size of a new vehicle in this country is 20% larger than 20 years ago. We have made great strides in increasing engine efficiency, yet the average mileage has actually dropped since 1985.

We have increased the size of the engines. Car ads promote how this car or that can go 150 mph and race down the road. Powerful engines sell, no doubt about it. Unfortunately, you can’t race down the road when the road is congested with traffic. And, unless you want to live in Montana just so you can drive at high speeds, there are speed limits everywhere else. A much smaller engine will get you to the same speed and save gas while doing it. But, its not macho to have a smaller engine. Having a bigger engine translates into having a better image. Dumber, but cool.

We increased the national speed limit. Nothing consumes gas like speed. Doubling your speed requires at least four times as much gasoline, and that’s not even including the increased wind resistance. Raising the national speed limit from 55 mph should have been called the ‘Arab Full Employment Act.’ Nothing has increased our dependence on foreign oil more than this single step.

Windfall profit taxes on oil companies. This is one of the dumbest things we can do. It is motivated only by greed, vindictiveness and stupidity. It is an prime example of how we blame someone else for our own bad decisions. The oil companies don’t even get a fair return on their investment. They average about 7.5% return, which is way below what other companies enjoy. But, they are considered the bad guys because they are selling us what we demand. Then, we turn around and demand they find new sources of oil, even though we just took away all of the profits they need to do that exploration. When we levy a windfall profits tax on the oil companies, they are then forced to go the the cheapest source of oil – foreign oil. What makes it even worse is that we can levy a windfall profit tax on U.S. companies only. So, we end up punishing U.S. oil companies and letting foreign companies off the hook.

We have cut government research into alternative energy sources. Are there sufficient words to express how bad of a decision this was?

We have cut funding to mass transit systems. See my comments above.

We saw in 1973 Arab oil embargo how dependent we are on foreign countries for our oil. We saw it again in 1979 when the Shah of Iran fell and we had to implement gas rationing. We went to war in 1990 when we felt Iraq had threatened our oil supplies and we certainly are in Iraq today because of oil. And what has been the result of all of this? We are more dependent on foreign oil today than we have ever been. The management of this problem has been distressingly incompetent.

But, things may be changing. Not because we are any less incompentent in the way we are handling this issue, but because the dynamics are demanding a change.

I know someone that works in Washington, D.C. and she tells me about how she ’slugs.’ This is a system where people park their cars and wait in designated areas for someone to pick them up that is going towards the same destination. The person parking their car (sluggers) obviously don’t have to pay for gas or do any driving. The advantage to the drivers is that they can now use the carpool lanes, which is a major advantage in D.C. Well, she has been telling me about how more and more people are slugging. This has led me to an observation about what is happening to mass transit in the U.S.

Mass transit in the U.S. is generally terrible. Some places like New York City have good mass transit and the the Washington Metro is very good, but they are more exceptions than rule in this country. We Americans just don’t like to use mass transit. Growing up overseas, I learned to use the mass transit systems and fell in love with them. I would much rather leave my car behind and pay someone else to get me there. But, it just doesn’t work here. I remember the system in Norfolk, Virginia. It would get you anywhere in the city, but only if you had a couple of hours to spare. Then it was the same on the return trip. So, whenever we introduce mass transit systems people will use them up to the point that they are convenient. Once traffic congestion eases to the point that it is bearable, people will opt to drive instead.

But, not anymore. It is now becoming so expensive to drive that people are parking their cars and taking mass transit. Not because its convenient, but because they can’t afford to do otherwise. Even as traffic congestion is improving, the number of people taking mass transit continues to increase. And, we haven’t seen the end of higher gas prices. I think we will see prices continue to rise over the summer and this will become a major issue in the presidential election. People will vote in November based on their feelings about higher gas prices. The fact that the president has nothing to do with the higher prices is irrelevant. I’m sure you won’t hear a lot of people saying that its our own fault. Instead, the voters will demand that the new president provide them with relief and will vote accordingly. It will be the number one issue this fall.

So, while I’m not thrilled with the hit to my pocket book by the higher gas prices I also realize that it is what must happen in order for us to do something about this very bad problem we are in. Hopefully, we will finally be motivated to act because the only thing that will force us to change our habits is cost. Logical arguments won’t work, but personal costs will.