Paying for our gas pains

Let’s see. A key measure of consumer confidence dropped this month to its lowest level in 16 years, “as Americans grew more concerned about their jobs and more pessimistic about business conditions.”

Meanwhile, “Oil prices have doubled in the past 12 months, surging nearly $8 a barrel in the past four days (since Tuesday) alone.” Both of these stories ran on cnnmoney.com.

Do these two numbers have anything in common? They are about as intensely intertwined as summer kudzu strangling an oak tree. Is skyrocketing oil the only negative pressure on the U.S. economy? Of course not. There’s the housing recession, the costly and un-winnable war in Iraq, record federal debt and a weak dollar.

Nonetheless, rising oil prices permeate the price of every consumer good imaginable making them more impactful than other factors. We Americans have known since the oil crisis of the 1970s that we needed to reduce oil consumption. We were warned again years ago as China and India ratcheted up oil usage. Rather than reacting by trimming back profligate oil usage here at home, we twiddled our thumbs, caved into business pressures to burn obscene amounts of energy and let the free-market types talk us into believing there would be no consequences.

Cheap oil is long gone and yet we still behave as if it were cheap and plentiful. Reform, massive reform, is needed and soon.

This weekend in my own neighborhood I observed one guy driving a Maserati with his top down. I counted three Hummers and I spied one couple pulling a powerboat behind a Cadillac Escalade. Far as I can tell, if Americans had any common sense, such behavior would have been banned years ago. Either that, or taxed into oblivion.

I’m not talking about banning gas guzzling agricultural or commercial vehicles. They are necessary to everyone’s economic wellbeing.

But given our present situation, the fact that people could be allowed to drive Maseratis as street vehicles or to spend $1500 (as one newspaper recently recounted the cost) to fill up the tank of a power boat while the rest of us can barely afford $4 for regular gas, is obscene. Gas tax policy must be revised to reward Americans driving fuel-efficient vehicles and take an “off with their heads” approach to profligate guzzlers.

Rocky Mountain Institute CEO Amory Lovins (who advocates lighter cars for greater fuel efficiency) says between 1977-85, when the U.S. last paid serious attention to oil consumption, we cut oil use 17 percent, cut oil imports by 50 percent, and trimmed Persian Gulf imports 87 percent while the economy grew 27 percents. Lovins’ critics claim lighter cars would lead to more highway deaths.

That’s an argument for another column, but in the meantime, Detroit has not seen fit to design lighter-weight vehicles. Not yet.

Detroit has seen a significant decline in sales of gas-guzzlers and while it’s a bad thing for automobile factory workers, it’s a good thing for oil consumption. But we need to do more. That includes severely punishing guzzlers who profligately burn fuel for leisure activities.

2004 Energy Information Administration figures show 20 million barrels of oil are consumed each day in the U.S. Some 40 percent is consumed by passenger vehicles, 24 percent by industry, 12 percent by commercial and freight trucks, and the rest by aircraft and buildings. Reducing profligate and unnecessary oil use among passenger vehicles is the quickest way to reduce demand.

How? We either ban profligate use or tax it into oblivion. Five years ago the National Review Online ran an article defending SUV owners:

“…But this is a cost (higher gas costs) that SUV owners are apparently willing to bear. Driving a vehicle with lower gas mileage requires them to purchase more gas. They are paying for the costs of their choice, and then some…”

Not all SUVs are profligate guzzlers. Some SUVs are fairly efficient. But this attitude, that Hummer drivers are already paying their fare share by buying more gas, is clearly wrong. Hummer drivers are also driving up the price of gas for hybrid drivers, and that’s crazy.

Do we have the political will to penalize profligate gas consumption? Not yet. But maybe when gas hits $8 per gallon, we’ll start to develop some spine.

(Bonnie Erbe is a TV host and columnist. E-mail bonnieerbe(at)CompuServe.com.)