Eric

Baerren

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March 17, 2008

Cheap Gas is Gone Forever; Can We Adjust to Reality?

We’re starting what’s become an annual conversation about the price of gas a bit early this year.

Seems like every summer, there’s lots of talk of how the price of gasoline has set new records, and a new set of circumstances that’s causing it.

The plain fact that we apparently haven’t quite grasped yet is that the days of cheap gasoline are over.

Oh, it’s something people might acknowledge if you really put it to them, but not in a way that suggests that anyone thinks it means anything more than paying more at the pump when getting from Point A to Point B.

This last week, it was reported that the price of gasoline might hit $4 in Hawaii shortly, a first this year. In years past, records weren’t set until the summer travel season starting on Memorial Day weekend.

The price of gas is, of course, somewhat relative. Last week’s record average price when adjusted for inflation still comes in second to a week in 1981.

Twenty-six years ago, however, was before the rise of a car for each side of the driveway in front of a home built in the suburbs and half-an-hour away from the workplace.

American life today is structured on a foundation of cheap transportation fuel. From where we live, to how food is put on the table, even to how retailers keep their shelves stocked, everything was built on the fantasy that fuel would remain permanently cheap. We did this while exporting the American Dream and ignoring the first rule of supply and demand – when demand is greater, the price will go up.

Today, we tend to think of it as an unqualified good thing that individuals living in China and India want to live like we do. What we forgot is that this meant also sharing some of the finite resources previously made available mostly to just us.

Increased demand includes internal pressures – people living in oil-producing countries who want to use what they’ve got before selling it to others.

The problem is that the issue is no longer just a matter of going out and getting more oil. Most studies say that we’ve either passed the point of peak oil production or will pass it in a few years. What will come after, if we wish to remain on the course we’re currently on, is going to greater lengths to feed the oil monkey.

Naturally, we get no direction from the campaign trail, where the only bad news we’re allowed to hear is either about the other guy’s personality flaws or stuff that we already know. Candidates don’t tell us what is likely to go wrong in the next decade because no one’s going to vote for a chronic buzz kill.

We do hear a lot of things that boil down to techno fantasies, about how new technology will enable us to get around with engines powered by groovy vibes. None of this will be helpful over the next decade as getting around just simply becomes more expensive, and any new technology works its way into general use.

Until that time, feel free to speculate about what this might mean to the American lifestyle, based as it is on easy and cheap transportation. We’ll look back on a period where we knew what was coming, but refused to do anything about it because it was inconvenient.

Of course, there is an alternative. While speculating how life might change as gas stays expensive, there’s an opportunity to make adjustments and investments that will help preserve as much of our standard of living as possible.

© 2008 North Star Writers Group. May not be republished without permission.

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