17 March 2005Musings
Record Gas Prices & Other Problems

When I finished skiing on Sunday, I drove down to Tahoe and saw that the Chevron at the bottom of Ski Run Blvd was selling regular unleaded, supposedly the cheap stuff, for $2.65/gallon. The stations near my house in Alameda are more reasonable at $2.35/gallon, but still far above the national average and way, way more then what I remember paying when I lived in Atlanta back in 96-97 when you could find places that would sell you a gallon for less than 90 cents.

How much is gas going for in your area?

Something needs to be done about this. Not because Americans must have cheap gas, but because the high price we're paying at the pump with its direct relationship to the record $54/barrel price is further entrenching illiberal dictatorships and oligarchies in the Middle East that our current foreign policy is trying to topple. It's not going to matter what happens in Iraq or Lebanon if oil rich states like Saudi Arabia and Iran continue to reap massive oil revenues.

Isn't it time we started a national effort to find alternative sources of fuel? Experts estimate that it's going to be a multi-trillion dollar industry not to mention the major shift in geopolitics that will occur when the demand for petroleum bottoms out or positive effects on the environment (it was over 70 degrees in Tahoe and snow was melting all over place).

It seems to me that the president has a unique opportunity to challenge the industry, the country and the world to bring about an energy revolution. But will he do it? No. Ironically he's in the pocket of the same energy companies that will benefit by being at the forefront of alternative fuel technology.

While energy companies should be pushing ahead with more experimentation, auto makers like GM are rolling back highly successful electric car programs and destroying all the EV1 vehicles. At the same time, demand for gas guzzling (and highly profitable) SUVs is shrinking in direct proportion to gas price hikes.

GM is a cornerstone of the American economy. It represents about 1% of the entire GDP. If the company's profitability goes down, it will have an adverse affect on the entire US economy. The jobs at GM are high paying. For each of these jobs at a GM factory, roughly 9 support jobs in the community are created. So if GM needs to lay off workers, it will have wide ranging ramifications around the country.

And sales isn't GMs only problem. They have massive, multi-billion dollar unfunded pension liabilities. It's so bad that the S&P is considering dropping their bond rating to junk. That would have tragic effects on the US Economy.

What the fuck does this all have to do with gas prices? GM is in trouble. Their sales are down and their fiscal situation is dire. At the same time that they should be investing heavily in alternative technology R&D, they are dumping their EV1 program. I believe if they reversed this decision and embraced electric and hybrid technology, it would stimulate other automakers across the board to do the same to keep up. This is turn would drastically lower demand for petroleum, would reduce gas prices, would eliminate the need (in the mind's of certain republican Senators and the president) to open ANWAR to drilling and would place America firmly at the forefront of one of the most promising technologies of this century.

Sorry, I went off on a bit of rant there, but I think you know what I mean.

Posted by andrew at March 17, 2005 10:04 AM


Comments

Rutger Bierens de Haan Says:

Andrew, stop crying about the gas price! Let me tell you, in beautiful Holland, 1 gallon (3,78 liters) = $11,19 !!!! So $2,35 is a sissy price! We would kill our mothers for such gas prices!

March 17, 2005 11:22 AM
Andrew Writes:

Yes, Rutger, but you live in a socialist wet dream utopia alomst totally accesible by bicycle and public transportation. This is America. (I knew I'd hear from the Euros first.)

March 17, 2005 11:25 AM
Marcela Says:

Yep, I remember the days when I could fill er up(toyota tercel ...DX ok!) for a mere $13. Those days are long gone, and, expect more of that this summer. Get ready America the "free"!

And another thing....sure the Holland folk pay a lot more for gas. But, the point here is that freakn "W" is reaping the benefits due to his oil investments. That alone kills me!

March 17, 2005 11:36 AM
Jennifer Says:

$2.32 last night in the WC (Walnut Creek, CA)

March 17, 2005 11:48 AM
Bill Says:

Maybe the US can counter this pocketbook tragedy by opening up its Alaskan wildlife refuge to oil exploration and production.

March 17, 2005 12:09 PM
Andrew Writes:

Bill-

I think the relatively tiny amount of reserves in ANWAR would do little to alleviate the long term problem. Plus it's going to take years to set up the facilities to start extracting the oil. By time that's accomplished we could be well on our way to replacing petroleum with hydrogen or ethanol or something else that scientists haven't even thought of, but would certainly discover if enough money was made available for research. Also Gale Norton and other interested parties, like Alaskan senior Senator Ted Stevens, assures the public that the oil can be removed without any harm to the environment, but I'm not convinvced. These are same people that allow singled hulled oil tankers to continue to ply the waters in Alaska.

March 17, 2005 12:21 PM
RF Says:

Hi Andrew,

This morning I paid $2.05 for the cheap gas about 2 hours later when I came home it was $2.l9 here in Cincinnati, Ohio. Mindy should be getting home early in May, she left Samoa in early December. She's taking the long way home in a few days she should be in India.

Grandma Freson

March 17, 2005 08:05 PM
Brian Henning Says:

$2.35/gallon for regular, $2.55 for premium (San Diego). Basically gas is only expensive if you need it! Ha. I would rather put gas in my car than milk-$4.00/gallon or a frappe, one gallon, probably about $25 or caviar, about $500/gallon
or live in eupore or israel, where $6-8/gallon is the norm.

March 17, 2005 11:31 PM
JenBen Says:

I paid $2.07 yesterday and it almost killed me. If I had the time to look around, I could have found it for $1.99 in Albuquerque. It was about $2.25 in Santa Fe.

March 18, 2005 08:48 AM
Rutger Says:

APPOLOGIES: WRONG CALCULATIONS!!

I was boasting about paying $11,19 a gallon in the Netherlands. I did my maths again, guess what, not my favourite activity, and it turns out to be around $6,38 a gallon. Still a lot of money. We are pretty good at pumping up cheese, tulips, drugs, and guys with fingers in dikes, but for gas we depend on the middle east. Cars running on water will be the future, no doubt about it. Ever thought of the moment, that 2.5 billion Chinese decide that it's great fun to take the wheel? The world would be running out of gas in no time. Hybrid Tech is probably the best solution.

March 18, 2005 10:20 PM
Colleen Says:

Here In Ann Arbor near North Campus was $2.34 or $2.28 yesterday. I won't fill up at these prices. I just put enough in to get by for awhile in hopes of them going back down. Prices are generally cheaper on Tuesdays and Wednesdays and they go back up on Thursdays.

March 19, 2005 09:40 AM
mary Says:

to our math wiz, rutger, i assert that water will very soon be far more precious than petrol. our excreble methane perhaps will be all that's left. in fact i think that some companies have already started draining the great lakes. and why have we not yet harnessed the tides for power? in, out, day in, month out, they push and pull; and could be generating power, no? yes, something needs to be done, and soon. if you can't make the transition to a bicycle yet, free americans, start with a motorcycle or scooter. you will find you don't need cargo/passenger space that often. oops, that was my rant starting....

March 19, 2005 03:52 PM




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