The list goes on and on. Low gas prices are at the root of many of the long-term economic problems we face today.
Yes, high gas prices hit us hard in the wallet. But what's the natural response to an unexpected expense? You look for ways to economize. You don't like paying so much for gas for your Hummer? Go out and buy a smaller car. Go out and buy an electric car. Go out and buy a hybrid car. Drive a car that runs on a non-petroleum fuel - they do exist. Ever heard of Ethanol or Biodiesel? You might even take a look at public transportation. Your parents and grandparents probably used it and they survived.
Low gas prices discourage innovation and the introduction of new technology Did you know that a company called UQM Technologies has developed a hybrid engine for the Hummer? But because gas prices have been so low, it hasn't been planning to make it available to the public and is just selling it to the military. Similarly, Dodge has a high-efficiency hybrid pickup that can run on biodiesel — a brilliant combination — but they aren't marketing it to consumers because cheap gas keeps demand down. Several companies even have viable electric cars ready to go to market as well. They've just held off from major distribution because they couldn't compete with regular cars because gas prices have been so low.
Similarly, distribution of alternative fuels for the already existing vehicles which can run on them has been slow because it was hard to compete with gas on price. Biodiesel sells for about $2.75 and pure Ethanol for around $3. The gas price has to get higher than that before they're competitive. Until then they're just much lower-polluting and cooler than petroleum.
Higher gas prices would change all of this. Higher gas prices mean that you might soon be able to buy a Hummer which gets better gas mileage than a mid-size sedan does now. Higher gas prices would mean:
• Instead of buying foreign oil we could use our vast domestic resources of harder to access oil like oil shale, which would create lots of jobs and business revenue
• Reducing our trade deficit and making the economy stronger by importing far less gas at a disadvantageous price.
• A rebirth of the failing railroad industry so we wouldn't have to bail it out every few years.
• Giving the lazy car companies a kick the right direction and putting new and more efficient technology on the fast track.
• The return of farmers markets, farm cooperatives, a boom in small farms and the end of farm subsidies - all because it would become more economical to produce locally than trucking produce nationwide. Not to mention the huge growth in agriculture for the production of biodiesel and ethanol.
• Less endless highway construction to accommodate the ever-growing numbers of cars.
• Lower state and local taxes for road maintenance on roads that will handle less traffic.
• New and better transportation networks, making attractive but impractical systems like light rail a truly viable option.
• Reduced pollution, first from people driving less and ultimately from increased use of more fuel-efficient and less-polluting vehicles.
• A much stronger economy because all of these things would create jobs and opportunities to make money and start new businesses.
Article comments
— go to most recent comments1 - Anna Creech
Wow. Very thoughtful, reasoned, and unexpected coming from you. I think I have mis-judged you.
My little 1995 Toyota Tercel is still getting 40 MPG, but I'd like to eventually get a replacement that is affordable and has a higher MPG. The hybrids are way out of my price range.
2 - Lumpy
Damn. I thought you were like Mr. Tax Cut, but here you are sounding like the most rabid of the enviroleft. What gives?
3 - Ray Ellis
You never cease to amaze me, Dave. And I am foursquare with you on this one.
Not to come across as a rabid treehugger, but I gave up on cars over a year ago, and I very rarely regret that decision. Those who say that you absolutely must have a car in Texas, especially in Dallas, are lazy or not creative or both.
4 - Matthew T. Sussman
You forgot one more advantage of high gas prices:
• An excuse to blame Bush.
5 - Tony G
Blame Bush?
Let's see...Do you support us drilling in Anwar?
6 - Tony G
Dave, I believe we have to not look ahead and get used to paying five dollors a gallon and instead try as hard as we can to keep it low.
Just because France pays 5 a gallon doesn't mean we have to.
7 - Ray Ellis
Once again, the entire point of the article soared right past you, Tony.
8 - Lumpy
Hey, what about the poor working stiff who can barely afford to run his car at $3 a gallon. At $5 he'll lose his job because he can't afford to drive to work if his income is below about $35k a year.
9 - Tony G
I'm with Lumpy. Damn those Europeans and these American European wannabes!!!!
10 - Matthew T. Sussman
Let's see...Do you support us drilling in Anwar?
I'm staunchly opposed to mutilating bodies of former Egyptian rulers.
11 - Tony G
You knew what I meant...now answer the fricken question.
12 - Ray Ellis
This is why the dinosaurs died--they couldn't adapt. You won't lose your job because you can't afford to drive to work--you'll lose your job because you used that as a lame excuse rather than devise an alternative means of making it to work.
Oh--and what is an "American European wannabe?
13 - Tony G
We shouldn't have to adapt to liberal ideas if we don't have to.
An American who is a European wannabe is someone who says "Hey look! The French are paying 5 dollors a gallon so we should too!"
14 - Anna Creech
Employers should to pay employees wages that are enough for them to live near their place of employment. I'm thinking of the low-wage workers that make up the infrastructure of resorts and other high-cost areas. Either pay them enough to live there or you go out of business because you don't have employees.
15 - JR
Tony G: We shouldn't have to adapt to liberal ideas if we don't have to.
Yeah, but we'll have to if we have to.
16 - Peter J
Sorry Dave,
You do make a lot of very good points, theoretically. The only actual benefit that we can realize right now is public transportation. I lived in Boston and left my car parked most of the time but that's pretty much only the case in larger more established cities. Everything else sounds too much like Right wing trickle down economics, they sound great too, only problem the only thing that ever trickles down is crap.
17 - Tony G
JR said: Yeah, but we'll have to if we have to.
This doesn't mean that we shouldn't do everything we can to prevent high gas prices.
18 - JR
Giving mentally retarded people access to the internet is a liberal idea, isn't it?
19 - Ray Ellis
It's one thing to talk thatalk--walking the walk is quite another matter. So that poses the question--what are your solutions, Tony? Or can you get past drivel?
20 - Jared
Eh, I'm bias. It's a good argument, but my dad works for a transportation company. He's paid by the mile. He drives what they give him. he has no say over what kind of fuel he runs on. And obviously public transit isn't an option when the whole point is for you to drive from point A to point B. he's having to spend more time away from home already because of the increase in gas so far. I shudder to think what continually raising the prices would do to the poor man.
21 - Jet in Columbus
Is it me, or is Tony related to BoingBat?
22 - Jet in Columbus
You're not taking into account delivery drivers and people who rent cabs and then try to make a living putting their tips into the gas tank...
I liked the article though, much as I tried not to, damn it.
Solus mei sententia
Jet
23 - Ruvy in Jerusalem
Dave, its's a great article. And if anybody believes in public transport, I do. But owning, and feeding a car was a ncessity in St. Paul, if you wanted a job that paid more than minimum wage. I suspect that this is still true. Bear in mind, that in Israel gas DOES cost $5/gallon, and Israelis tend to earn half of what Americans do - if they are lucky.
In most of your country, intra-city transit, suburb to suburb public transit, and things of this nature just do not exist. Here, we have a pretty decent public transit system, but in the States you do not.
The rails are falling apart in the States. Where will the money come to resuscitate them to carry goods and carry them to all the burgs and farms etc, that you speak of? Will this come from reduced taxes?
The ultimate price you pay for everything in the States will rise to pay for the price of gasoline. Where does that extra money come from? Does it come from the rich? Give me a break!
Tripling the world's oil prices in 1973 has been draining your country of a lot of wealth for 3 decades. The recent increases, which amount to doubling the price of oil is impoverishing your country even more.
You wrote a great article, but it just don't wash clean...
24 - Dave Nalle
Damn. I thought you were like Mr. Tax Cut, but here you are sounding like the most rabid of the enviroleft. What gives?
I didn't make the point in the article, but it ought to be made. The gas tax I propose is NOT the same as the kind of taxes I ordinarily object to. It's more on the order of a usage fee for those who drive a lot. It's not a violation of basic property rights because it is entirely voluntary and only impacts those who choose to drive to the degree that they choose to consume gas.
I'd recommend that a certain amount of money from such a tax be specifically earmarked for regional and local public transportation programs.
As for it hurting the working man, he ought to be taking the bus, carpooling and finding other ways to live within his means anyway, callous though that may sound.
Dave
25 - Dave Nalle
et's see...Do you support us drilling in Anwar?
Well, I certainly do, Tony. Increased domestic production should go hand in hand with conservation.
Dave, I believe we have to not look ahead and get used to paying five dollors a gallon and instead try as hard as we can to keep it low.
Just because France pays 5 a gallon doesn't mean we have to.
But the articifially low price has been the standard for years and it's really not working. It's what killed the Texas oil business in the 1980s, and has had all the other negative effects I note in the article. The idea is not to pay more to keep up with France, but to pay more because it will strengthen our own economy and in the long term will reduce our dependence on foreign oil.
Dave