Are today's gas prices really making anyone go broke?

Personal Research | unpublished | Don Simmons

[chuckwalla]

So double tap had to go to his anger management class.

[kenth]

One bad analogy on top of another.

The oil companies manage to keep their profit margins up, as well they should, so it's silly to say that gas 'should' cost fifty bucks a gallon. The problem with the price of fuel is that it does affect people. You or I may not feel it directly. We may not care and denigrate those whom it does affect by telling them to lay off the beer, etc. That is until the fuel prices start inflating the prices of everything else. Already the fuel surcharges in transportation are starting to make up a large chunk of the transportation costs. It will be passed down to you and me.

And, of course, the real problem is the government. Through direct taxation the price of fuel is a third higher than it could be. Through regulation, we are unable to provide our own fuel and rely on nations who definitely don't have the best interests of the U.S. at heart. We have to hope they will continue to sell to us because of their need for our money. And, we shoot ourselves in the feet by mandating all sorts of formulations that put a strain on production at the few refineries that we allow to exist.

[RightWhale]

It appears that most civilian driving is voluntary. Going to work and home from work is a percentage, but social activities--including shopping and kids' games--have been arranged to require transporting bodies from one place to another at frequent intervals by private vehicle. We could lose all that without missing anything vital.

[chuckwalla]

So you say we should surrender?

[RightWhale]

What might be worthy of mention is that while we are rich beyond kings, our wealth is tied up in our cars. The $7 trillion private debt would be nothing if it weren't for the cars. While cars made us wealthy in the first place, we don't make our own cars anymore. We don't have car manufacturing jobs so we are sending our money abroad and borrowing to do so. Also, in case someone hasn't noticed, driving is not pleasurable anymore. It's not fun and it's not profitable, so why do we do it?

[templar]

. I don't see people gnashing their teeth over the large jumps in steel prices over the last year.

People don't generally consume steel in bulk in the course of their daily lives, they do fuel. Steel is used to produce products consumers buy but is rarely bought directly by consumers (products made of steel are usually long lasting, not used up daily, as well). Fuel is used directly by consumers on a daily basis as well as being used to produce products consumers buy. Concerns over the price of raw materials which are not directly purchased by consumers are usually expressed as concerns about inflation in general.

[TheRightGuy]

And, of course, the real problem is the government. Through direct taxation the price of fuel is a third higher than it could be. Through regulation, we are unable to provide our own fuel and rely on nations who definitely don't have the best interests of the U.S. at heart. We have to hope they will continue to sell to us because of their need for our money. And, we shoot ourselves in the feet by mandating all sorts of formulations that put a strain on production at the few refineries that we allow to exist.

Excellent points, all. Here in Illinois we have 4 separate EPA zones each mandated to have its own formulation in each of three grades with separate summer and winter blends for each. It's amazing they ever manage to have enough of whatever's needed coming out of the pipeline at any given time.

Of course the state adds a gasoline tax on top of the feds -- even counties and municipalities in Illinois are allowed to add their own cents per gallon taxes, and then everyone (state,county,city) chimes in for their own sales tax percentage which is charged against the already taxed gasoline.

[Luis Gonzalez]

Then find median wage in 1960.

[Luis Gonzalez]

Because that's not their job.

As usual, you want to muddle up the issue with non-related topics.

There are both types of stations here today, I make the choice as to which one I want to use.

So do you.

[Ditto]

Concerns over the price of raw materials which are not directly purchased by consumers are usually expressed as concerns about inflation in general.

But you made the point that even though the gas price hikes are not that much for an individual to handle, they ripple through the economy in higher prices for other goods. My point is that steel and other commodity prices do the same.

People have irrational responses to gas prices. They will wait in line to buy gas a penny cheaper at one station to save 20 cents a tank full when they wouldn't think twice about that 20 cents on other purchases.

[templar]

My point is that steel and other commodity prices do the same. ... People have irrational responses to gas prices.

When was the last time you bought raw steel by the ton and how much did you pay? When was the last time you bought gasloine (or diesel, fuel oil, etc) by the gallon and how much did you pay? See how differently, noticeably, and personally, the price increases in gasoline affect every person and how different the price of steel is in that respect?

[Ditto]

Follow the argument. The other poster was saying that even though the price rise in gas is small compared to other ways we spend our money, the price rise bounces across the economy and causes other prices to rise. I made the point that the same is true for many other things.

On a inflation adjusted basis, the price of gas is lower today than when I started buying it 40 years ago. I get a kick out of all the bitching and moaning by people walking around with bottle of designer water in their hand.

[optik_b]

"I'm a single mother of three living on a tight budget otherwise known as a shoestring.
That extra money in the tank is hurting me, I do home health care and I have to travel, I have had to turn down jobs recently because of the cost of gas."

How far would you have to drive for gas to be a factor? Unless you drive a gas guzzling SUV I dont see how gas prices should be a factor in your taking jobs. For example if you took a job that was 45 miles both ways and drove both ways in a car with 25 MPG you would pay less than 7 dollars for gas for that job.

[optik_b]

"The other option(?) is to trade safety(big, heavy, vehicle) for economy(light, small, usually loser in accidents)."

Get one of those soon to come out hybrid SUVs - Lexus RX400h or the coming Ford Escape.

[SouthernFreebird]

I drive a van... it doesn't get 20+ MPG. Also I do home health care so I don't spend all day at one job site. I have to travel to many different patients in a day. The costs of gas is a factor for me in taking jobs right now.

[optik_b]

"I drive a van... it doesn't get 20+ MPG. Also I do home health care so I don't spend all day at one job site. I have to travel to many different patients in a day. The costs of gas is a factor for me in taking jobs right now."

I am sorry that its impacting you so greatly. If you are an independent contractor you can deduct the mileage you drive for your job from your taxes. Keep a log of all the miles you drive for your job. It is $0.36 per business mile for tax year 2003.

[Don Simmons]

You are much worse than an idiot. You're obviously one of the bellyaching dumbocrats causing all the problems.

You know this site has an abuse policy? Did I attack you?

I never approached my posting from an all-inclusive, across-the-board standpoint. As I think I clearly indicated, it's a commentary on the overplaying by the media...and it's my opinion.

You're entitled to yours as well. However, your short-sighted, abusive reply serves only to MAKE my point for me.

Thanks so much for your enlightenment. I'll make a note of it. (I'm rolling my eyes and giving you a salute.)

[optik_b]

I agree with your post. As Gregg Easterbrook wrote:

There is something deeply spoiled and selfish about an affluent American pausing at the door of his luxury SUV to announce outrage over paying $2 a gallon for fuel he will proceed to waste by nailing the accelerator to cut others off in traffic. This is particularly true if he just ran into the gas-station minimart to buy a Dasani for the SUV cupholder, since status-brand bottled water retails for about $8 a gallon, and no one has to drill it, refine it, or fight over it. Americans pay less than half what Europeans do today for gasoline, in addition to paying less in inflation- and buying-power adjusted terms than Americans of the 1950s paid. All the political complaints--and the news shows and talk shows hyping "record" prices without perspective--are the product of a spoiled culture.