Coming soon: $4 a gallon

Image at left courtesy of the New York Times.

Gas prices are widely expected to reach $4 a gallon this spring, when refineries reformulate their products and supplies tighten in advance of the busy summer travel season, according to a report in last week's New York Times. Of course, this will further squeeze households' disposable income, and probably have severe macroeconomic consequences, since decades of hidebound state and federal highway "investments" have given gasoline suppliers an effective monopoly on American transportation.

The article generated some good letters:

"Would it not be a novel approach if Americans, instead of cutting back on other expenditures to compensate for the rising price of gas, made a serious effort to cut back on fuel consumption? ...this would be a win-win situation for the economy, the environment and the health (both physical and financial) of the average citizen and perhaps even decrease our dependence on foreign oil.

"No wonder no one in our dysfunctional, hand-wringing government has made the slightest move — much less offered any practical incentive — to encourage it.

"Louise T. Guinther, Forest Hills, Queens, Feb. 27, 2008"

and

"European countries have become accustomed to gasoline at $4 a gallon. In several countries it has been above $5 for years. These countries have long taxed motor vehicle fuel at a much higher rate than the United States does and used the revenue to build mass transit systems that really work.

"Gas will reach $4 and $5 a gallon here as well, but unless our politicians show more courage and foresight than they have in the past, we still will not have mass transit that works well enough to park or sell our cars.

"Lane Anderson, Marina Del Rey, Calif., Feb. 27, 2008"

Meanwhile, while gas is still relatively cheap, we're already beginning to witness the first gunpoint robberies committed by criminals who need to fill up their SUV tanks (seen on CarFree USA blog).