Thanks, I did read the article. Ethanol doesn’t have anything to do with the increase — food prices in particular have been driven up by the price of petroleum. Even the price of ethanol has been driven up by the price of petroleum.
As you look across all of society...its like this “deer-in-the-headlights” look when you ask them to correlate the upward trend of $2.50 a gallon gas to $4 a gallon. I would say that ninety percent of the public doesn’t get it.
If a guy uses a tank a week....doesn’t even matter about milage here....then he is spending around roughly $2340 per year (18 gallons a week) when gas was $2.50. Then you figure the same guy at $4 a gallon and you have $3744 spent. That $1300 difference doesn’t come from payraises or government bonus checks....its coming straight out of your pocket. Thats $1300 less for the typical family to spend. Thats a summer vacation or a new fridge or a new couch for mama or a new laptop.
Then you have to figure in the “other” folks...who truck your food to Wal-Mart, or grow your corn, or the school buses that pick up your kids, or the delivery guy who brings your bottled water by the house. They all upped their prices over the past year or two as well....so you can pretty much guess another $1000 a year went to that increase. All total, $2300 with your gas hike and their gas hike.
Ask yourself where a guy who makes $35k a year pulls $2300 out of his billfold? He is cutting every single corner and starting to deny himself and the family things. Even the guy who makes $60k a year has issues, because junior at sixteen expects a car which will trigger a $150 a month gas expense as well. The four years that junior is in college....means a car with $1800 in gas expenses minimum. All of these guys are now suffering.
So here is the trend. Kids at sixteen will start to notice that dad doesn’t automatically give them a car (he promises one at eighteen)....fewer car sales. The kids get to borrow mom’s car but get less gas allowance, so going to the movies everyweek with their buddies...is cut back to twice a month...thus the theaters make less money and fewer teenage flicks are generated out of Hollywood. That yearly five-day trip to Grandma’s four states over? Its canceled this year because of gas cost. The airline tickets you would normally buy for Thanksgiving to visit relatives are up by 40 percent over last year, so you decide to stay home. Wives start to shop in pairs to save gas money, and just make one trip per week to grocery. Even those 42 nights of bowling that you used to do per year, will be challenged and you might settle for a league where you bowl only 36 nights per year.
Across the spectrum, you can see a slowed economy and the standard money-makers from the hotels to bowling alleys to Hollywood suffering by the end of the year. Things aren’t going to be the same. And the amusing thing....is that I haven’t even gotten to the $5 a gallong scheme, which will trigger a huge revolt by the minimum wage crowd. Those folks will ask for a $8.5 minimum wage by spring of next year, to pay for their gas expenses...so more costs are going up across the entire economy.
I am the bearer of ill news and pretty dark predictions for the future...but this is reality which the news networks won’t speak about and you won’t see any intelligent guy from the local paper write about. We all better wise up about our future and look for some method of cheaper fuel because the American economy can’t function with gas at $6 or $7 a gallon which is the fair prediction for 2010.