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Rising gas prices causing family hardship

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6:01 am
June 30, 2008


Writing-On-The-Wall

Member

posts 49

Hi, just now as I got onto Yahoo to check my emails this early morning, there was this interesting poll/story as a headline article on Yahoo News: http://news.yahoo.com/page/election-2008-political-pulse-gas-prices

Seems the majority of people they polled are expecting significant financial and lifesytle hardships from the rising price of gasoline.  Here are some quotes:

Four dollar a gallon gas has stolen a beach vacation in South Carolina from Julie Jacobs' family and exotic bath washes from Angela Crawford. Phil English had to sell his beloved but fuel-guzzling red pickup.

Like a plague that does not discriminate by economic class, race or age, soaring gas prices are inflicting pain throughout the U.S. Nine in 10 expecting the ballooning costs to squeeze them financially over the next half year, an Associated Press-Yahoo! News poll said Monday.

Nearly half think that hardship will be serious. To cope, most are driving less, easing off the air conditioning and heating at home and cutting corners elsewhere. Half are curtailing vacation plans; nearly as many are considering buying cars that burn less gas.


The latest survey shows how the price of gas has caught or eclipsed every other issue, not just as a political topic but as a problem in peoples' lives.


Many lower-earning families are responding by easing their use of air conditioning and heating, trimming vacation plans and cutting other spending. But higher-income people are often not far behind.

Two-thirds earning under $25,000 a year are cooling and heating their homes less, as are nearly six in 10 people earning more than $100,000. Just over four in 10 of the lowest earners are cutting vacation spending — only slightly likelier than those earning at least six figures to do so.

Rich or poor, black or white, young and old, nearly everyone is looking to drive less: A nearly uniform seven in 10 say they are reducing driving. That compares with six in 10 who said so in an April 2005 AP-AOL survey.


There also is a strong sense of powerlessness. One-third do not think either candidate can deal with the problem. That includes half of independents, one-third of Republicans and one-quarter of Democrats.


     Interesting that gas prices are now seen as the USA's number one problem, because despite the dramatic price rise (which I happened to think myself are not strictly due to marketplace fundamentals at present and which I continue to predict will ebb and decline somewhat as we head into the election and holiday seasons), really we have only begun petroleum depletion pricing.  Many credible people (like Hirsch and Matt Simmons) are predicting $200 for a barrel by or during 2010, something I am tending to think as well.  The citizens of the US have only begun to suffer and they will soon be regretting and upset about more than the change to a lower quality bath soap, cutting out the family travel vacation and selling their beloved, gas guzzling pick-up.


     Still, there was a sense of reality in people's expectations, indicating that higher prices will change people's attitudes and behaviors, even here in the USA.  Just as numerous peak oilers have stated.  We as a country won't do the smart, right things - like change one's lifestyle into a low consumption one - for morality, concern for the planet or future generations or because it is smart and strategic, BUT we will change when we can't afford to do stupid, wasteful things any longer.  Even more so as the job losses accelerate.  So there's is hope of a sort. -Joe

7:44 am
June 30, 2008


todd

Guest

And as Ilargi points out, currently the worst hardship isn't even caused by retail gas prices. However, I think a deeper analysis would show energy prices to be at least partly responsible for the collapsing housing and credit markets. Anyone else agree with that?

Ilargi: I’ve read several articles lately suggesting that the troubles in the US and EU finance system are caused by high oil prices. As I’ve said often before, the numbers don’t make sense. The very idea, as well as all the complaining about gas prices, stem from man’s genetically defined tendency to pay attention first and foremost to immediate threats right before his eyes.

And as logical as that may be, it’s not always the best strategy. In cases like this, it’s like being too busy swatting flies to see the entire pride of lions sneaking up on you from behind.

When you get all puffed up about gas prices, you fail to see the overall picture: a thousand gallons of gasoline over the past year have cost about $1000 extra. Home prices fell 14.1% (Case-Shiller), or about $30.000 per home. In other words, an estimated 200 million US drivers have paid some $200 billion extra for gas, while values for the 100 million US homes have fallen by $3 trillion. And that’s just housing; trillions more have also vanished from other parts of the economy. It may take longer for some of the effects to be felt, but that makes them no less real.

It’s time to get some perspective here. The rise in gas prices so far is a joke compared to what’s happening in finance. The truly perverse effects of rising oil prices haven’t even started yet.

1:42 pm
June 30, 2008


Michael

Member

posts 10

“Hardship” indeed.  It's amazing the difference between what is called hardship in the press these days and what we are expecting.

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