davidleong.info

like many americans, my in-laws seem obsessed with gas prices these days- they’ve always got a pulse on cheapest gas in the neighborhood. i know lots of people are hyper price-conscious when it comes to saving even a few pennies per gallon, but really- i’m not sure i get it. i do recognize that the price of gas is a key economic indicator and that according to recent inflation stats, everything is costing more, but are we getting all worked up over nothing? it seems to me that most people are upset not about our dependence on foreign oil (which is the real concern) but instead about how rising gas prices have lightened their wallets. but what does it really cost us individually?

if you, like most americans, drive about 1000 miles per month and get roughly 25 miles per gallon (generous by CAFE standards), then depending on where you live, you’re probably spending about $3 for a gallon of gas and thus ~$120/month to drive said 1000 miles. let’s say that tomorrow gas prices jump an astronomical 10% in one day and suddenly gas is $3.30 per gallon. obviously, this would cost you only an additional $12/month to drive the same amount. sure, it adds up, but couldn’t you just eat out one less meal or skip one movie ticket? or better yet, carpool or take public transit? should people be up in arms over $12/month?

yes, i realize that overall increases have surpassed 10% over the past few years and that discretionary spending over hundreds of millions of consumers really does add up, but i do still find it odd that individuals seem upset about the personal financial cost to them when in actuality gas price fluctuations have been fairly slow and small with historic price levels remaining relatively stable and cheap. am i missing something here? has expensive gas really caused you financial hardship? for a few that really do depend on cheap gas (i.e. a LONG commute), i see how it’s possible, but i wonder if average consumers are angry about nothing.

ultimately, i think the individual price sensitivity is a distraction from the real macro problems- oil companies with ridiculous profits, government subsidies that have given us an artificial sense of the true cost of gas, expensive wars fought for oil control, insufficient funding/market demand to catalyze industry innovation, and a general lack of motivation (until recently) to pursue alternative means of renewable energy.

what do you spend on gas, and has the rising cost of gas caused you to change your lifestyle?