Of course, this has all manner of beneficial aspects as well, not the least of which is that the survival of at least two out of the three major U.S. automakers is all but guaranteed, an outcome that not even the most rose-tinted optimist would have ventured but two short years ago. Ford is quite literally the industry darling, having both engineered phenomenal new products and avoided a government bailout. General Motors, meanwhile, has already started paying back said bailout money and, if its stock does indeed reach the US$50 predicted by analysts, governments will actually recoup a profit for their largesse. Car dealerships are booming, the travel industry is once again back on its feet and, should fuel price increases remain tepid, it will make a mockery of analyst/author Jeff Rubin’s contention that globalization is in retreat because we can no longer afford to import our goods and produce from afar.
It’s all good news, right?
Well, not quite. The dual edge of this (relatively) cheap fuel sword is that, as evidenced above, we are not changing our driving habits. We are not slowing down, we are not driving less and we are most certainly not embracing green cars despite the media’s contention that the case is otherwise. This year’s Detroit Auto Show was chockablock with alternatively fuelled automobiles and all command enough of a premium over conventionally fuelled automobiles that they will require a significant increase in fuel prices to be made viable.
And not just any fuel price increase, but a true kick-us-in-the-pants that quite literally grabs our attention. The untold part of this story is that the increased sales of these gas guzzlers come among fuel prices that would have left us apoplectic just three short years ago. We Canadians started screaming as soon as gas hit $1 a litre and the last time I filled up, my gas receipt indicated I spent $1.24 for every litre of high-test, not far off the $1.40 that was once deemed Armageddon. South of the border, Californians pay as much as US$3.60 a gallon, again not far off the US$4 mark that was then determined to be the end of motoring as we know it.
Yet, unlike 2007, when these benchmarks led to protests and a surge in Prius sales, there’s been barely a peep in the papers, and this time we’ve responded by buying more pickups.
The lesson gleaned, then, is that increased fuel pricing alone will not curb our spendthrift ways. Should this gradual increase in fuel pricing continue ad nauseam, I suspect we may bitch and moan a little as each milestone — $1.50 a litre, $2 a litre, etc. — is passed, but we will adapt, as Darwin always preached, to our gradually changing circumstances.
If the oil crises of 1973, 1979 and 2007 have taught us anything, it is that we, the mindless consumers, only react to dramatic price shocks. If we really want to have a green future with the increase in alternatively fuelled automobiles we’ve been promised is right around the corner, we’ll need gasoline pricing to increase dramatically. And, yes, that means government intervention and taxes.
As a free-market capitalist, I am ambivalent about such intervention. On the one hand, I see the benefit of a price-fuelled uptick in emissions-reduced automobile sales. On the other, I really do believe people have the inalienable right to be as stupid as they please, even if that means buying a fuel-chugging pickup they may not really need.
The only thing that is certain is that a gradual rise in fuel prices will not lead to the green revolution that we’re all told is looming.
Postmedia News
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