I wrote a post a long time ago about how gas would hit 4 dollars a gallon and some of the consequences I thought it would have on the driving habits of most Americans. Well courtesy of Adam’s blog here is a photo of 4 dollar gas as a reality in California.
Well here is my next prediction, 5 dollar a gallon gas! And maybe even 6 dollar a gallon. The Washington Times is reporting that 70 percent of Americans see 5 dollar gas as a foregone conclusion. What does all of this mean? Here are a few things.
1. Gas is only going to continue going up, maybe until the end of next year. If you believe the forecasts of some of the largest financial institutions then don’t be surprised to see 200$ a barrel oil by the end of 2009, and this is without any major eruption of violence in a oil producing nation. All of this reminds me of only about 14 years ago as a little kid visiting my grandparents in Kansas and going to fill up with my dad. Gas was 87 cents a gallon. Those days are long gone and the developing world now has an unquestionable hunger for America’s greatest addiction.
2. People will travel less. This is the reality of the situation. When it costs even 50 bucks to fill up a mid-size car people will begin to think twice about where they drive and how. This should be an interesting cultural development in suburbia and church activity participation. I am sure this will begin to factor in for many as decide how to spend their free time. I would not be so dramatic about this if food costs and health insurance are making the margins for the American family smaller and smaller. For many a few elective driving trips will become the financial tipping point.
3. The end of the gas-guzzler. News report after report is saying that SUV’s and trucks are lagging in sales and wasting away on the lots of car dealers. Ford has already reported that they are diverting away production activity from their truck SUV line to small compact cars. Anecdotally, I heard a guy next to me at the pump last week cursing the whole time he was filling up his Dodge Ram. His total came to 103 dollars! We made eye contact as I was filling up our Honda Civic, I could tell he was coveting my Civic and just laughed as I drove off after filling up for 36 dollars. This story is being repeated all across the country as people with massive trucks are having to chose between making the payment and driving them; they can not do both.
Why do I spend all this time writing about this? Because it is a great example of how American policy is much like most families; they wait until the problem is here before they worry about it. This gas problem has been a long time in the making and yet as a nation we have ignored it and kept consuming recklessly. We are doing the same thing with our nation’s oncoming Social Security problem. So now as a nation we will have to spend the next 10 to 15 years in this rut as we wait for new technologies or fuel supplies to have a national impact. So in the words of Mellencamp, “This is OUUUUUUUR Country!!!”