Here’s a familiar headline: “Price of oil brings economy to its knees.”
If you saw this in a newspaper five months ago you would be able to relate on a very personal basis. Most of us were cutting back on trips to the grocery store just to keep our tanks full for the trip to and from work.
In many ways, it looks like it was the first shoe to drop in this economic downturn.
When oil-per-barrel prices hit and exceeded $150 and thus $4 per gallon for gas, consumer confidence and spending went down dramatically.
But what a difference five months can make. That headline is now what is being said in the largest and wealthiest oil-producing nations in the world.
Last week, as oil prices sank below $50 a barrel, reports told the tale of the impact around the world. Venezuela – which has become our newest nemesis in the Western Hemisphere, friend to Castro and engaging in joint Russian naval exercises off its shore – needs oil to be at $95 a barrel to support its economy.
Saudi Arabia, the wealthiest of all oil-exporting nations, requires at least $55 a barrel to support its economy. Both of them – and one could surmise many other nations whose economies are driven almost exclusively by U.S. and world demand for oil – are beginning to have very difficult economic times of their own.
When the United States and other world economies slowed down and thus cut oil demand by only a few percentage points, it creates a balance of power shift between nations that sell and those that consume oil. Oil producers need our economy to do well in order for theirs to do well.
As it turns out, all we had to do to shift the power relationship was only go to the grocery store once a week rather than every other day.
Who knew?
One particular report on National Public Radio really caught my attention because in the same newscast included a discussion of U.S. automakers’ attempts to get taxpayer dollars to save their companies.
It struck me that the two stories had an obvious connection and yet I haven’t heard anybody making it. So I will try.
If in exchange for economic assistance, the automakers would promise to double the average fuel economy of their fleets in not 10 or 15 years, as has been negotiated by their lobbyists in the past, but rather two years as now being negotiated by the taxpayers, how would that change the world we live in?
For me personally, I’d trade my 2001 GMC Safari van in tomorrow if I could get the same size of a vehicle that got 40 miles to the gallon rather than my current 16. Many people believe the technology exists to make a gasoline-burning engine provide dramatically more distance per gallon.
Private inventors have been retrofitting Detroit’s products and accomplishing this goal on their own.
The CBS evening news featured just such an inventor from Kansas on Tuesday.
Detroit has resisted this obvious improvement for less than obvious reasons. Washington, D.C., has taken lobbyists’ money and allowed this industrial laziness to continue for less than obvious reasons.
Why don’t we extricate ourselves from the geopolitical mess that is the Middle East?
If we doubled mpg for all American-made automobiles, wouldn’t it solve bigger problems?
Now I’m sure there are smarter people than me out there that would argue that it’s more complicated and I’m oversimplifying the issue, and maybe I am.
But as long as U.S. automakers are asking for my tax dollars, I’d like to ask for 40 miles per gallon, please!
Andy Lasky and his wife, Katie, own and operate City View Bar & Grill – “Atop Johnstown's Famous Inclined Plane” – and Westwood Plaza Theatre, both in Westmont.
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ANDY LASKY | Fuel efficiency’s broader impact
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