So what is this big news? Did Osama get killed again? Did Jerusalem fall to the Romans? No!!! The big news is that the price of gas will go up overnight by 6.5 cents a litre. How could this happen? I've watched as a reporter on the street interview angry motorists filling up. Those dastardly bankers with their "derivatives" were identified as possible culprits. Hedge funds and other speculators could be in on it as well. Then again maybe it's just the big oil companies conspiring to drive the economy into a recession such that they sell less of their product?
Some perspective is always good. When I lived in the UK, gasoline cost roughly three times as much in Ol blighty as in the Great White North. With the change in exchange rates, the cost in the UK is now roughly double that which we pay in Canada.
Despite this enormous inequity in gas prices, Brits have not been reduced to donkey pulled wagons as their primary form of transportation. Civilization has not crumbled and if you see people selling apples on the street, then you are probably in one of their somewhat charming street markets.
Brits (as well as other Europeans) have adjusted to these higher fuel prices by utilizing a very clever technology that few North Americans are aware of. It is called the smaller car. I saw many small model cars in Britain that aren't even available over here because the car companies know that they wouldn't sell. General Motors actually makes some very high quality small cars (for Europe). The Vauxhall Corsa is a very nice little car with good mileage. However it is not practical to sell in North America as you cannot fit more than 8 cases of beer inside it.
I will not endear myself to my Conservative brethren he by saying this, but the truth of the matter is that our fuel prices should be much much higher. If we ever want to break North America's addiction to tar sands and oil imported from countries ruled by dictators, then we simply have to consume less oil. Hybrids are nice but they simply won't replace regular cars fast enough to make a big difference. The only way to dramatically reduce oil consumption is by increasing its price. Gas taxes should gradually go up to be on a par with European pump prices.
People will adjust. They will drive smaller cars, take public transit, walk more and cycle more. Necessity is the mother of invention and so I would expect that fuel efficiency will increase even on large SUV's.
People will adjust, though they will probably still complain about gas prices as they walk along drinking a bottle of water that costs more per fluid ounce than the gas they just used to fill their car.
By the way, this massive 6.5 cent increase overnight that is so scandalous.....well I have a 50 litre tank. So it will cost me a whopping $3.25 extra to fill up!!!
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