Here come the fucking pollyannas…

I’m starting to hear it on the radio and read it in the newspapers.  “The price of crude oil dropped sharply again today.”  “The gas crunch is easing.”  “You can drive that SUV a little more.”  “Gas is falling below $4 a gallon!”  The feeling I’m getting is that many commentators are starting to feel the worst is over, and things will be going at least somewhat back to normal.  We’ve maybe dodged a bullet here, and we can all start breathing easier. 

I swear, if “journalists” (and I use the term loosely) had any brains, they almost be stegosauruses.  (I know, it should be “stegosauri,” but I don’t want to sound hoitytoity.)

The fact that the price of gasoline is retreating slightly makes me afraid people are going to fall back into their old habits.  True gas is still high, and still pinching many budgets.  But between gradually-falling prices and people making tweaks to their budgets—a cut here, a shift in funds there—I fear the requiem for the SUV and more broadly the energy-hogging mentality that is America may be greatly exaggerated.

Although the recent trend has been dowards, let’s not forget that the overall trend in the last three years—coincidentally (or not?), starting right after the Bush Administration won its second term—has been up up up.  Some of this is increased demand around the world certainly, but there’s no way you can account for all this sudden increase by India and China.  They’re doing well, but they’re not doing that well.

So what we’ve had is a gradual—and then a rapid—ramping up of gas prices.  We become terrified they will go straight up forever, and take relief in whatever tiny break comes our way.  The prices go back down—a bit—and then people start thinking time are better, they can live with this.  But what they don’t realize has happened is that the price point for what’s “proper” or “expected” for a gallon of gas (or a litre of petrol if you’re reading this from Gordon Brown land) has shifted upwards in our mind.  We no longer find last year’s prices high.  They’re now “cheap.”  So if we go back there we will feel like we once again have access to “cheap gas,” a concept the oil companies could not have fostered on us at such price levels last year.  (I have to laugh, by the way, at these columns on blogs and websites that advice skipping that $3 latte to save money.  One of the few pleasures in life that’s not outrageously expensive, and they want me to put my neighborhood barista, who probably bikes to work, out of a job so that I can fuel my SUV.)

To give another example of how this works, when I was a kid (not that long ago) the phone bill was about $10.  Television, unless you lived in a remote part of the U.S., was free, although you had to tolerate commercials.  Today, our wall-phone is $25-$30, maybe more, depending on all the features you may feel you can’t live without (star-69, call-waiting).  Then we have the cellular bill—who knows, anywhere from $40 a month to hundreds.  Cable TV is the norm, anywhere from $50 to again hundreds a month.  The total “telecom” bill can be anywhere from $100-$200 a month for one household.  I won’t even count Internet, because that simply didn’t exist back then, nor satellite radio.  (Remember, all radio used to be free, too.)

Twenty years ago if anyone told us we’d be spending maybe $200 a month or more on our phones and television programming, we’d have thought that a ridiculous price point.  Today we fork over the money and don’t think much about it.  That’s how much things can shift.  You may think it’s worth it and maybe you’re right.  My point is we’re barely aware of it, whereas we should be very sensitive to things like this.

But at least much of this increased spending (though certainly not all of it) is discretional.  No one requires you have call-waiting and 110 cable channels.  Frankly, I don’t own cable and don’t want it.  I didn’t watch I Dream of Jeannie when it was free; why should I now pay for the “pleasure”?  Movies I rent; sports I don’t care about, and cable news and business coverage is a joke.  What would I do with cable, use it to hang my laundry outside?

But many people no longer feel a $100-$200 price point is too high.  I know we make more money now, but not that much more.  I do know that credit terms are looser than ever, and more people are living off Visa than ever before.  And economists wonder why Americans’ savings, never all that high to start with, are now nil.

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