Tuesday, May 09, 2006

Pain at the Pump

One of the hottest issues in the news over the past several weeks has been the skyrocketing price of gas. Nationwide, the average is nearing $3 a gallon; here, in the Bay Area, I have seen it top $3.45. Everyone who drives a vehicle, which is almost the entire population here, has been greatly impacted by this. The price of filling one's tank has risen by over 30% in the past few years. This has greatly increased the amount one must shell out at the pump to get around.

After Hurricane Katrina, when gas prices rose to record levels, an amazing thing started happening. People started changing their habits. The gas-guzzling SUVs were parked. Travel was reduced. Public transit use increased. And, more than ever, the great benefits of energy-saving hybrid vehicles are at the forefront of the public's mind. The sales of these vehicles, as so eloquently displayed by Rakesh, have increased dramatically in the past several months. This is all directly related to the record inflation of the price of fuel.

People are changing their habits. This is a good thing.

Previously, the American appetite for big, bigger and even bigger was insatiable. SUV sales were through the roof, and not exclusively for those with large families and lots of cargo. These huge vehicles invariably have pitiful gas mileage, waste natural resources, and pollute the environment at an alarming rate. Still, the American public could not get enough of the pavement-pounding, largely-empty, social-status behemoths. Until the cost of fueling them hit the drivers right where it hurts. Their wallets.

Today's American society is that of waste and excess. No amount of begging and pleading for social and environmental responsibility will change this fundamental characteristic. The only thing that effects change, so it seems, is to make it cost more to be wasteful.

We're still not there yet. According to a Kelly Blue Book study, only 27% of potential buyers would consider a smaller vehicle to reduce fuel consumption. 22% said they would not sacrifice anything (power, size, brand name or price) for greater fuel economy. This is troubling, but I'm not sure it won't improve. I'd like to see the same study done in 6 months, with the gas prices the way they are now. I think the current price structure might elicit a greater change.

Even so, a noticeable number of people are parking their SUVs and large trucks, and driving smaller cars. Some are trading in their large pavement pounders for smaller, more fuel-efficient vehicles. New buyers are considering fuel mileage as a gating factor for their decisions. This is what we want, not only for the environment, but to reduce our dependence on foreign oil. It is a step in the right direction, on all fronts.

However, there is a downside. The recent astronomical increase in the price of gas has hit the entire country, including those with low, limited or fixed income. Those with lower-paying jobs are finding it more difficult and costly to travel to work. Many may find it prohibitive.

Bill Frist's proposal for a $100 gas rebate across the country is completely useless and counter-productive for the SUV-driving, latte-sipping high-rollers. But it may be a welcome relief for those that can barely afford to feed and clothe their families. Yes, it's not a permanent solution. Yes, it doesn't curb the exponential growth of the price of gas. But by targeting low and fixed-income people, it can make a small difference, if only to temporarily help them through a difficult situation.

I is inconceivable to me how someone could make the comment in the proposal article that $100 would only be two gas tanks in a 15 mpg Sequoia. People that can afford to drive such a wasteful and expensive vehicle do not need a rebate. They need an attitude adjustment. And a more efficient method of transportation.

Perhaps, the current gas price situation will make that happen.


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