Rising Gas Prices Will Stoke Inflation
I lived and worked through the 1970s and after the Viet-Nam war (which President Nixon escalated ) ended in 1974, we were broke. And then oil prices rose significantly. I was living in Phoenix at the time and worked in the automotive industry. The gas crisis was so bad, people were siphoning gas from other people’s cars. Hence, the invention and widespread sale of locking gas caps. Even I bought one for my VW bug. Well, we have had two more wars that have cost billions and bankrupt us once again PLUS the global financial collapse that cost trillions, and now another gas crisis due to the Libyan conflict. The worlds economies are fragile and this could put many into a double-dip recession. That’s was happened in the 70s. By the time Reagan got into office in 1980, the interest rates were at 17%.
This is serious business and the President is considering drawing from the our Strategic Oil Reserves. He needs to get on with it as that oil needs to be refined and into distribution as soon as possible to hedge prices. No matter, rising oil and gas prices will affect everything around the globe. This is the Plan ‘B” thing I have spoken about since the New Year: Plant a garden, stock your pantry, get yourself a rainwater barrel, and start considering other forms of transportation. Network and THINK LOCAL.
Yahoo News reports:
The U.S. per-gallon price is $3.47 for regular. In Philadelphia, gas hovers between $3.29 and $3.79 per gallon. Some parts of California report prices from $3.65 to $4.89 per gallon. In Europe, the story is worse; crude oil is $116 a barrel and per-gallon gas prices average $8.06.
When gas prices rise, airline and food prices also rise. Average airfares have risen by $4 to $10 for each round-trip ticket and pricing pressures on consumer goods see prices trending up. Retailers such as Lowes express fears that the U.S. will feel the same effects, as overall food prices jumped by 2.2 percent overall, and in Philadelphia, food increased 1.4 percent in 2010, and continues to rise.
America has always enjoyed lower gas prices than the world, protecting Americans from what the world has had to adjust to; for that reason, Americans lack interest in fuel economy and renewable energy. It is not an environmental factor anymore, but an economic one as well and American renewable energy is less developed than other similarly developed nations, even though it receives greater press coverage.
Germany’s energy program is going so well it could produce enough to power the entire country by 2050. In 2009, 8 percent of America’s power came from alternative sources, not enough to break away from our collective oil addiction. Why can’t the U.S. fall in line?