The general attitude towards taxation has been that people want services, they want quality education, and they are willing to raise taxes but not on themselves. Why do I bring up taxes? Because I am about to contradict that theory.
I will be very honest, the cost of gas is kicking my hind parts and crippling my precariously “balanced” budget in my home. I spent 45 dollars filling up the small gas tank of my Honda the other day. We have two cars and 80 to 90 dollars for gas every week or two takes a huge hit on our budget.
At the same time, this is actually a good thing in at least two ways. The first way is that gas prices were headed in this direction in 2008. But then the economy collapsed and along with it the price of gas. Very briefly there was a time when gas was under $2. That is an amazing thing because up until about the year 2000, I had never seen gas over $2.
In fact, the summer I met Cecilia, I had driven across the country with a friend, and we were consistently paying between 89 and 99 cents a gallon. But those days are long gone and I think of my parents in the late 1970s telling stories about 25-cent gas in the days before the oil shortage.
The point is that gas’s upward cost trajectory was interrupted for three years by the economic collapse, and so, while the cost of gas is becoming a problem, it is actually a sign that the economy is improving, slow and unsteady as that might be.
But there is another reason why I think gas prices being about $5 or $6 per gallon will be a blessing, and that is that it will bring the alternative fuel market into competitiveness with fossil fuel.
That was starting to happen in the last decade, prior to the economic collapse. With $5 or $6 gas, all of a sudden the bus, alternative transportation, hybrid and electric vehicles and the bike look like very attractive alternatives.
Moreover, I believe that adversity is at the heart of innovation. When things are going well, there are few reasons for innovators to rock the boat. Automobile companies, when business is booming, have few reasons to design more fuel-efficient cars and develop new and cleaner burning technologies that move us away from our dependence on fossil fuel.
And the bottom line is that fossil fuel is bad. It is unsustainable.
We have global warming, but, while very concerning, more people are buying into the political rhetoric and discourse that global warming is not human-made. The problem is that once people recognize and accept the truth, it will likely be too late to reverse its affects.
Don’t believe in global warming or don’t believe that the phenomenon is the result of human activities? Fine. Then consider that our efforts in the Middle East are primarily due to the region’s large oil supply. Would we care about Iraq without its oil? Would we be involved in Afghanistan if the region were not vital to our interests? Would we be in Libya without oil in the region?
The answer is likely no. You can argue Israel all you want, but without oil the Middle East would not represent the strategic importance that it does today, we would not have antagonized extremist elements in the region, and we probably would not be involved in the so-called war on terror, that could be renamed: the war to keep our foot in the region to protect oil interests.
This is not a political statement, I am not justifying or criticizing our efforts, I am only explaining them.
There is something in this for everyone, but the bottom line for me is that if we can find a way to get off oil, we solve the Middle East problems, we solve the environmental problems and in the process we solve our own fiscal problems.
To get to that point, I believe we have to take the hit, as unpleasant as that might be. If I have to pay more per month on gas and less on something else, if in the end it means new and cleaner burning technologies, the development of alternative fuels, the development of a high-speed rail and other mass transportation, then I am for it and I am willing to take that hit.
—David M. Greenwald reporting
Are you willing to take the hit that will drive us into another recession?
Is there any evidence that that will happen? Besides, I’m not sure what short term policy is going to change a whole lot.
David
I would add one more item to your list of potential positives. To the degree that increased gas prices get people out of their cars and onto their feet or bikes, it will have a tremendous benefit for our health over time. This will be true in multiple areas. Reducing automobile emissions will lower the incidence ( and health care costs) of asthma and other pulmonary conditions. Increased walking and biking have the potential to decrease the rates of obesity and eventually Type II diabetes , cardiovascular disease and even some forms of cancer ( for Elaine, both uterine and breast cancer known to be increased in women with BMI over 30 and over 50 years old).
Are there potential economic downsides as pointed out by rusty49? Absolutely. And I feel that these risks are worth taking given that ultimately we will have to move away from oil dependency any way. Why not use the current situation to start moving away from this self limited and destructive technology in favor of healthier alternatives ?
May is “Bike Month”… perhaps the Vanguard “community” should pledge and follow through on a commitment to ride a bicycle, when possible, in lieu of a motor vehicle trip. I have committed, thru my employer, and hope to have every trip within Davis accomplished via bicycle this month. A “Vanguardian” group could be established, and they could compete with the other groups that have signed up.
The recessions of 73-75, 81-82 and 07-09 were in part caused by high gas prices.
Raise the prices of fuel is the mantra from the left. If they won’t do what we say is good for them then we’ll force them into our way of thinking. On a local level it is like letting our parks go unattended and not fixing potholes will force the the citizens of Davis to take action, right David?
While I am largely in agreement with David’s observations, “if we can find a way to get off oil, we solve the Middle East problems, we solve the environmental problems and in the process we solve our own fiscal problems.”seems absurdly optimistic ! I think alternative fuels and fuel cell technology offer us the most promise for cleaner, cheaper power.
I have given up hope that Americans, especially Californians will ever give up personal motor vehicles, so, unless the “overburdened taxpayers” want to subsidize rail travel the way we do commercial airlines, (There’s some real welfare !) I can’t see mass transit working here.
BTW When I began driving, 110 octane premium gasoline sold for 34 cents/gallon. Good thing too, because I drove a 1957 Buick Super that averaged around 8 mpg.
BTW-Adjusted for inflation, gasoline prices are about doubled from 1968 !
Right now the main alternatives to petroleum are other fossil fuels–coal and natural gas. Coal has gone up in price but is still plentiful and relatively inexpensive. However coal is even worse than petroleum in terms of global warming since it creates more carbon per btu.
Natural gas is much cleaner and has less carbon per btu. Nat gas is also extremely cheap right now due to a huge increase in supply in North America from shale deposits.
We need to get ourselves off fossil fuels before we destroy the planet. Even people who do not listen to scientists about global warming should be concerned about an energy source (petroleum) that comes from unstable areas. Moving to Nat gas is a no brainer in the medium term but long term we need other sources of energy that do not emit greenhouse gases.
David is basically correct here. Higher oil prices are sending an important signal to the economy. If we would let the market react, rather then railing against oil companies and trying to centrally plan winners, we would see innovation producing solutions, as it always has in the past.
One policy we would do well to consider is a tax on imported oil. This would encourage domestic production. It would stop foreign produces from lowering prices to undercut domestic alternative, as such moves could be countered by increased taxes. It would be largely absorbed by foreign producers needing to remain competitive. And it would generate large amounts of revenue (a plus if you believe spending will not rise as a result).
This option has never been seriously considered by either party, for various political reasons.
dmg: “The point is that gas’s upward cost trajectory was interrupted for three years by the economic collapse, and so, while the cost of gas is becoming a problem, it is actually a sign that the economy is improving, slow and unsteady as that might be.”
LOL You could have fooled most people in this country this is proof positive that the economy is somehow “improving”. As far as I’m concerned, that is leftist spin at the moment. Gas prices go up for any number of reasons unrelated to the oil supply. When the pope died the price of gas went up as an example. Whenever some newsworthy event happens, no matter whether related to oil in some way or not, the oil companies will frequently use it as an excuse to increase gas prices. Right now Obama is investigating the oil companies, believing they are gaming the system to gouge the public. Where has Obama been? Oil companies do it all the time. And it rarely has to do w the oil supply. The reason one knows this is because the newsworthy trouble will happen, and gas prices will start spiking immediately – even though it would take a bit of time before the supplies would start to shrink. So the oil companies are at it again, raising the price of oil bc of “unrest in the Middle East” and the “uncertainty of the oil supply”. Pretty nebulous reason to raise the price of oil – why not wait and see if the “uncertainty of the oil supply” results in an actual shortage? And it is my understanding that Saudia Arabia stepped up its production of oil to keep prices stable…
dmg: “But there is another reason why I think gas prices being about $5 or $6 per gallon will be a blessing, and that is that it will bring the alternative fuel market into competitiveness with fossil fuel.”
High gas prices right now are apt to doom any effort at an economic recovery. How’s that working for you? Furthermore, we have known as a nation that we have a dependence on foreign oil as far back as 1976, when gas lines first appeared. And not one darn thing has really been done to wean this nation off its dependence on foreign oil. In fact environmentalists have made darn sure we don’t by standing in the way of just about every attempt to drill for oil in the United State; or the use of coal and natural gas. So what do we do as a nation? Ecourage stupid alternative fuels like ethanol production, which is more polluting than gasoline, bc it helps the farming industry which has a heavy lobby in Congress.
I listened to an interesting television program on the alternative fuel industry recently(sorry cannot remember the name or even on what channel). It pointed out the federal gov’t was subsidizing all sorts of ridiculous forms of alternative fuels, many of which are impractical as too costly in the short and long run. I would also point out to subsidize high speed rail in the country is the height of stupidity, in not only my opinion, but in the opinion of many experts. The beginnings of this type of system was tried many years ago w the commuter rail line between Washington, D.C. and New York City. It has been a catastrophic and abysmal failure; and has had to be propped up with huge infusions of gov’t subsidies to even keep it going. Lack of ridership just does not warrant the expense.
People don’t seem to realize what works in Japan or Europe, for instance, may not work here. This country is an entire continent wide, whereas Japan and Europe are very, very small in comparison. High speed rail may work for them bc of that difference. But it is not a cost effective mode of transportation in the United States.
Lauding bicycles in CA, where the weather is nice a good part of the year and the terrain is flat is fine. But in most parts of the country it is a very impractical mode of transportation. Try riding your bike through New Hampshire in the summer where the mosquitoes in some places are so thick you have to literally stay inside, and the winters preclude the use of bikes bc of deep snow.
And now bc of what has happened in Japan, the nuclear industry is in doubt as an alternative fuel, and for good reason. Every mode of transport/every form of energy has its advantages and drawbacks. I would argue we should not self-limit as a nation, but employ a multi-modal approach. But the one thing I do agree with is that we have always needed to wean ourselves as a nation off the use of foreign oil – that’s a no-brainer. But how and with what and how much it should be subsidized is the question. What we need is a comprehensive energy policy, and we have never had one, and I don’t see one coming anytime soon.
But high gas prices right now being a good thing? LOL
Elaine
I can see high gas prices as a good thing if they were to move us in the direction of your ultimate stated goal, a comprehensive energy policy.
Like you, I would like to see a multi modal approach . I would not discount basically any of the options that are being put forward, even those some consider ” silly “. The Wright brothers were considered silly and impractical by many in their day. Also, I think it is important to remember that development of our own non renewable resources is a temporizing and temporarily stabilizing measure. My concern is that as we convert to more domestic production, we become complacent and do not peruse sustainable alternatives thus delaying, not preventing the ultimate need to wean ourself off our non renewable resources. Or we could just not worry about what happens to future generations since I anticipate our oil supply will last throughout my lifetime. It seems like a fair number favor that approach !
There is a certain irony in this to discussion to anyone who has lived/traveled in Japan or Western Europe. Compared to those countries, gas at $5 or even $6 is incredibly cheap, and those economies seem to just keep humming along. We’ll get used to it, and do just fine. And the world will become a litter greener as a result.
“We have global warming, but, while very concerning, more people are buying into the political rhetoric and discourse that global warming is not human-made.”
lol, as if the pro global warming forces don’t engage in “political rhetoric”? and yes, of course they are buying into it, because one of the key IPCC scientists, Michael Mann, was caught with his pants down and privately admitted in emails to his colleagues that global warming has serious problems with it.
“The problem is that once people recognize and accept the truth, it will likely be too late to reverse its affects.”
this is my favorite pet peeve with left wingers: “my opinion is truth”
“and we probably would not be involved in the so-called war on terror, that could be renamed: the war to keep our foot in the region to protect oil interests.”
call it what you want, if osama bin laden, achmedinejad have control of those oil interests, they can use the profits to finance their terror network. there is nothing “so-called” about it.
I’m sorry but if you are one of these people that is trying to slug off the threat of terrorism, then you need to pull your head out of the sand.
“If I have to pay more per month on gas and less on something else, if in the end it means new and cleaner burning technologies, the development of alternative fuels, the development of a high-speed rail and other mass transportation, then I am for it and I am willing to take that hit.”
so much pie in the sky rhetoric. first of all, half of these green technologies have serious problems with them:
High speed rail: extremely expensive, and inefficient.
electric: who the hell thought of this idiotic idea? electric cars must suck their juice off the power grid, so you will need to invest in coal and nuclear energy, and yes gas.
solar: one word: inefficient.
Observer: “There is a certain irony in this to discussion to anyone who has lived/traveled in Japan or Western Europe. Compared to those countries, gas at $5 or even $6 is incredibly cheap, and those economies seem to just keep humming along. We’ll get used to it, and do just fine. And the world will become a litter greener as a result.”
Have you ever ridden on the subway in rush hour? The Japanese system is so crowded at rush hour, I read where they have to have “shovers” to cram people into the cars. Seems to me some of the European ecomonies are in very serious trouble, as is Japan (altho the recent tsunami/earthquake are a contributing factor). At $5 or $6 a gallon here, it could very well stall the economy and head us towards another recession. Let’s just say Obama is worried enough about that possibility he is starting an investigation into possible price gouging. Remember the Enron scandal, and the gaming of the energy market? Same goes on in the oil market.
Musser: “call it what you want, if osama bin laden, achmedinejad have control of those oil interests, they can use the profits to finance their terror network. there is nothing “so-called” about it.”
Good point. Even supposing we had an energy policy in place, and were completely oil independent as a nation – could we afford for Russia’s surrogate Iran to take over the oil fields in Iraq, to further fund its terroristic elements? Terrorism adds a whole new dynamic to foreign relations…
Musser: “so much pie in the sky rhetoric. first of all, half of these green technologies have serious problems with them:
High speed rail: extremely expensive, and inefficient.
electric: who the hell thought of this idiotic idea? electric cars must suck their juice off the power grid, so you will need to invest in coal and nuclear energy, and yes gas.
solar: one word: inefficient.”
So should we scrap all of these in favor of oil? I’m not following what your solution is here…
Missed
Agreed that the green technologies that you have mentioned are currently inefficient. So were cars, airplanes, computers…. In their infancy. I suspect that you are too young to remember when computers filled rooms to perform less complicated functions than the devise I am holding in one hand while making this entry with the other, but I am not.
Developing these technologies is most likely just a matter of time and willingness to put our faith in the future instead of clinging to an increasingly obsolete and destructive past. I lived in Southern California when the usual color of the sky was yellow, not blue, largely due to automobile emissions.
Moving forward to sustainable and clean technologies will not happen overnight.t I believe that the sooner we start accepting that our current technologies are not sustainable, the sooner we can move towards a comprehensive policy that allows us to avoid financial, military and political disasters today while building the basis for a cleaner energy future.
“There is a certain irony in this to discussion to anyone who has lived/traveled in Japan or Western Europe. Compared to those countries, gas at $5 or even $6 is incredibly cheap, and those economies seem to just keep humming along.”
Are you kidding? Japan’s economy has been stagnate for 10 years and the PIIGS’, (Portugal, Ireland, Italy, Greece and Spain) and I’m going to throw in England and Greenland’s economies are on the brink of collapse.
Studies show that for every one cent rise in gas it takes 1.4 billion dollars out of the economy. The first quarter GDP came in last week at 1.8 but was projected to be 4 and many economists are blaming the slower growth on the rise in oil prices. I think anyone who thinks that gas going to $5 or $6 dollars a gallon won’t severely impact our country isn’t very “well-versed” on the economy.
rusty49
I don’t believe that anyone is saying that gas going to $5 or $6 per gallon would not severly impact our country.
There is the thought however that the relatively cheap gasoline that we are used to has led us to make some very poor, selfish, destructive
choices and that a more balanced approach to our energy needs would be a good change for the future.
Musser: “call it what you want, if [s]osama bin laden[/s], achmedinejad have control of those oil interests, they can use the profits to finance their terror network. there is nothing “so-called” about it.”
A slight edit to make, there.
“Studies show that for every one cent rise in gas it takes 1.4 billion dollars out of the economy.”
Can you cite those studies please and also explain how the money goes out of the economy, where does it go, some ether?
Can you site those studies please and also explain how the money goes out of the economy, where does it go, some ether?
http://www.pbs.org/newshour/rundown/2011/04/why-gas-prices-are-such-a-economic-drag.html
I don’t see a study in there that validates your claim that one cent rise takes $1.4 billion out of the economy.
Musser: “call it what you want, if osama bin laden, achmedinejad have control of those oil interests, they can use the profits to finance their terror network. there is nothing “so-called” about it.”
wdf1: “A slight edit to make, there.” [cross out of osama bin laden]
Nicely done wdf1!
[i]”Moving to Nat gas is a no brainer in the medium term but long term we need other sources of energy that do not emit greenhouse gases. “[/i]
Dr. Whu – I completely agree. Frac drilling has changed the fossil fuel game and will continue to as more and more countries take advantage of this American ingenuity. It was invented by one man… I think his name was Hank Rearden (heh!). Note that this breakthrough was provided by the liberal curse of capitalism… the ability to pursue profit. Note too that when technological advances allow alternative energy sources to generate profit, they too will grow in availability and use. Note two: it is also possible that additional technical breakthroughs will allow us to keep finding and producing cheap fuel made from non-renewable sources.