Maybe we should do a countdown to $8/gallon gasoline. Heh, that'll cause a revolution. Probably the wrong kind, though. Fai de bèn a Bertrand, te lou rendra en cagant
yet UK SUV (Chelsea Tractor) sales were increasing when last I looked. hopefully that trend is about to reverse bigtime. The difference between theory and practise in practise ...
Remember taxes and £1=2$ Peak oil is not an energy crisis. It is a liquid fuel crisis.
They may be housed in the same facility soon enough.
Well, 5FF/l came, and nthere was no revolution. You had lots of ads for cars able to get to 5l/100km, an important fuel efficiency standard then (equaivent to just under 50MPG), and then that slowly disappeared as prices stabilised and people got used to them (the government smartly increasing taxes when oil itself went down, so that at least the nominal price of gas never went down, even if the real one did)
People will pay 8$/gal, and after a few months they won't even mind anymore. People need their cars.
Which brings me, as usual, to how high the oil price can go - and the answer is - high enough to cause so much pain that people will actually spend 2 hours waiting for a crappy bus rather than pay for gas - and that's a LOT higher than today's prices. In the long run, we're all dead. John Maynard Keynes
And I was laughing with Chris, not at his assertion, in case I expressed myself unclearly on that score as well (which my wife will tell I do all the time).
All this being said, and agreeing on the fundamental demand inelasticity , or at the very least, extreme stickiness, that you describe, one could take the role of devil's advocate as regards the impact, on US public opinion, of severe shocks of energy inflation. First, unlike France, where 60% of household energy use is electricity, overwhelmingly produced by nuclear energy, in the US, household energy use is heavily weighted to gas and oil (roughly half of household energy use in the US being for home heating, virtually all of which is gas and oil, in addition to which roughly a quarter of electricity generation is from gas and oil). So, when oil prices go up, it's not just the price at the pump which goes up. People get cold and the poor go hungry in order to pay their heating bill as well.
Further, and this is far from a myth, the automobile plays a different role in the citizen psyche in the US than in the EU. This is of course a generalization, but it's not for nothing that as soon as people get scared of being attacked by a terr'ist, they started driving around tanks which get 16l/100. Tax incentives also play a part, but it isn't just tax policy, the automobile is much more an extension of one's personal space in the US than in the EU, where it is more seen primarily for its utility. I know this sounds crazy, but it is what it is, and people don't like it when their private space is being screwed around with, or they can't afford their private space anymore.
Finally, there's virtually no public transport to speak of in the majority of the US outside the eastern seaboard, so that's simply not an option. Further accentuates the inelasticity by removing a potential substitute good, further increasing the likelihood of pain on the individual consumer.
So while I agree with you on the inelasticity/stickiness aspect of what you are saying, it's far from obvious that on this subject Americans will be as stoic as Europeans were when the '70's oil shocks hit and EU governments began to responsibly price externalities into the consumer price for petrol. In fact, there's a real good negative correlation between gaz prices and approval of Dubya. Americans are just fine with torture, an illegal war killing thousands of innocents, a whole city lost to global warming, and the median income stagating while the rich get immensely richer. But fuck with their gasoline, and be prepared to pay the price.
Of course, that price would be simply an expression of disapproval, which is about as active as the average American gets these days in registering protest. Fai de bèn a Bertrand, te lou rendra en cagant
... high enough to cause so much pain that people will actually spend 2 hours waiting for a crappy bus rather than pay for gas...
Whatever price level oil might have to reach to produce that effect, maybe the bus won't be so crappy after all. The bus company should then (finally!) be able to make a profit by pricing their service below the cost of private driving, yet above their actual operating costs. That means acquiring energy-efficient buses, running reliably and on time, hiring good drivers, and so forth. It sounds pretty good to me!
Buses, specifically, should have a bright future in the U.S., where large numbers of people live in far-flung places with no rail service. There is really no other way to transport those people.
Some entrepreneur will probably come up with a fancier, more impressive vehicle which is no longer called a bus -- maybe an Air Pavilion or something -- but which amounts to the same thing without such a steep fall in status.
