Some Thoughts About Gas Prices

I was reading this morning that the price of a barrel of crude oil is about $90 and by the looks of things will hit a hundred dollars pretty soon. This probably doesn't bode well for the price of gasoline.

Some of us remember the gas lines going around the block in 1973 after the price of gas got jacked up significantly by the oil cartel. I also read that at $100 a barrel the price will equal, in the equivalent of 1973 dollars the price of oil back then. That happening was considered responsible for the recession that lasted more or less into 1976. Jobs were scarce, interest rates were high and people were only interested in economic gas consumers. Remember the Pinto? I had one of those. Fading into memory were the production lines of mega gobblers with big block Ford, Chevy and Chrysler engines. Auto companies did what they could to build cars with better mileage. Lighter steel bodies and chassis, more aluminum, plastic everywhere replacing heavier components. Mercedes diesels that got 30 miles per gallon were drawing a lot of attention as were motorcycles.

That sobering episode in history started a flurry of movements to develop alternative energy sources, from windmills, solar collectors both water and photo-voltaic, energy cells and diesel car engines that could run on used French fry oil. The government developed incentive programs to encourage fuel efficiency and sponsored creative uses of existing energy. Unfortunately when things had calmed down in the '80s most of the federal tax incentives and energy research grant money programs were allowed to expire. Hybrid cars are still eligible for tax credit and incentives to some extent but the jury is still out on whether or not hybrids produce significant long term savings considering the extra cost of manufacturing. After all, those batteries need to be built too.

Perhaps what we really need is $5 a gallon gas. Maybe that would create the incentive we need to put a full court press on lessening the dependence on OPEC oil and reducing our horrendous trade deficit. Most of Europe has already faced such prices and have made sincere efforts to reduce energy consumption.

The fact that the Chinese hold approximately 90% of our treasury debt is not at all comforting. The economic growth in China is at a rate of 12-14% annually creating a skyrocketing demand for energy further tightening the supply available to us.

Where is the rhetoric we once heard championing hydrogen fuel cells, solar collectors, wind farms and safe nuclear power? It's time we heard them once again.