One distressing thing about getting my car back is that, when I handed my car over to the Butcher, gas was just under two dollars a gallon. He’s handed it back to me and gas is just under three. Or it was yesterday. I haven’t been out yet today.
I think all of us have heard the rumors that John Snow is leaving the Treasury Department because he has failed to convince the American people that our economy is doing well, even though our economy is supposedly doing well.
I don’t think you have to be a political genius to see that it’s hard to convince people who have to pay twice as much for gas as they did a year and a half ago that thing are fine. I, for one, am not making twice as much as I made a year and a half ago, so paying twice as much for gas makes me feel less than confident in my household economy, which makes me feel less than confident in the economy in general.
Newscoma is, in her usual brilliant way, all over this. She brings us this shocking paragraph from the Washington Monthly.
It turns out that the average household uses about 1100 gallons of gasoline per year and has an average income of about $44,000. Take out 20% for taxes and that’s a disposable income of $35,000.
So at two bucks a gallon that means the average household spends 6% of its disposable income on gasoline. At three bucks a gallon it’s more like 10%. And that’s only the average.
Holy shit! I get distracted just looking at that first paragraph. If the average income of an American household is $44,000, who the fuck is buying these $500,000 townhomes in my neighborhood*? And how many people must there be making next to nothing to balance out the people who can afford to buy half a million dollar condos and bring the average down to $44,000? Wow. I mean, is it a bell curve where most people make around $44,000 and then there are relatively fewer people the closer to dirt poor and filthy rich you get? Or is it an inverse bell curve, with most people either dirt poor or filthy rich and a relative few who make what the average between the poor and the rich is?
However, let’s not get distracted with thoughtful analysis. After all, USAToday isn’t.
Another way to look at the oil markets’ behavior is as the world’s de facto energy policy, at least for the near term. With rising demand from China and India, there’s almost no room for error on the supply side. For lack of any other solution the market has, in effect, hiked the gas tax by 55 cents a gallon in the past two months. This is painful to most drivers, particularly low-income commuters. But there is little doubt that a market-imposed tax of this size will spur conservation.
However one looks at today’s prices – as an insurance premium or a tax – they’re the new reality. High gasoline prices aren’t going to blow over like summer storms. If traders can bid up the price of oil so easily, then the best thing consumers can do is assume that these levels either are here to stay or will return with some regularity.
The best thing policymakers can do is concentrate on long-term strategies to develop alternatives to oil. That would involve a good bit more courage and perseverance than they’ve shown so far. But it’s better than being dependent on oil from unreliable sources.
Maybe it’s just because USAToday is a paper in the same way that I am an internet superstar, but this has to be the lamest of lame editorials. I mean, if you are a newspaper, you have access to information. Part of your job, when forming opinions to put on your Op/Ed Page is to digest all the information you have access to and formulate an idea about them, preferably an idea that your readers cannot, because they don’t have access to the same information you do, see on their own.
Not the USAToday staff, though. I mean, really, their argument is this “groundbreaking” idea: We cannot control the price of oil, because we cannot dictate what the market does and with India and China increasing the demand for oil, there’s more demand than there is supply, thus prices are high. Therefore, consumers must just suck it up and pay whatever they have to pay. And policymakers must come up with ways making us less dependant on foreign oil.
Well, thank you, Einsteins. I would have never thought of that on my own. That’s nothing like what folks have been saying for thirty years.
Never mind that, according to Newscoma’s sources, I’m giving Uncle Sam a fifth of my income and then turning around and giving another 10% to the oil companies.
Ten percent of my income to multinational corporations that can hold my household hostage to their profit-making whims without me having any say in it? That’s pretty alarming. And USAToday thinks I should just suck it up and learn to deal with it because it’s the new market reality?
Gee, thanks for that wisdom.
I have a radical suggestion.
We’ve fucked up in Iraq. Fucked up terribly and the country is descending into civil war. Iraq also sits on a great deal of oil, which we, as a country, need. Let’s stop trying to make Iraq a sovereign nation. We obviously don’t know what we’re doing when it comes to that.
Instead, let’s accept that we’re in empire-building mode, conquer Iraq, and steal their oil. Excuse me “liberate our” oil.
We, then, have access to a lot of oil, which can be made available to the American people at a more reasonable price and the Republicans give the impression that they’ve done something for the American people that makes a real, positive difference in their lives.
Shoot, with brilliance like this, I could do Snow and Rummy’s job both. …thus saving the taxpayers money, because they’d only have to pay one of me to occupy two positions.
Cost savings all around.
Give me a call, Mr. President!
*Okay, no one yet. But they wouldn’t have put them up if they didn’t think they could sell them.