A lot of libs are secretly joyful that gas prices are on the rise because, in their eyes, it spells doom for the hated SUV and their wealthy drivers.
But....
High gas prices widen divide between rich and poor
Tue Aug 16, 7:49 AM ET
Though the price of gasoline has risen by more than 60 cents a gallon in the past year, economists have been quick to note that the impact has been limited. That's because the role of energy in today's high-tech, high-finance, health care economy is much smaller than it was in the 1970s, when surging energy costs wreaked economic havoc.
But though the current price spike is unlikely to generate stagflation or bring back WIN (Whip Inflation Now) buttons, it is being keenly felt by low-income workers, who spend a larger portion of their income on necessities such as food and fuel. For someone who drives 15,000 miles a year and gets 20 miles per gallon, a 60-cent jump means an extra $450 a year at the gas pump.
Though that might not seem like such a big deal to those in the more comfortable classes, it's far from trivial for workers already struggling with soaring costs for housing and health care.
Consider the cruel calculus of rising fuel prices faced by low- and moderate-income workers in high-priced communities. Many have been forced in recent years to commute longer distances because of rising housing costs. Now, they have to pay more to commute.
Adding to the misery is a undeniable fact: Oil prices are rising because of economic growth both at home and abroad that many workers are not benefiting from. The recovery in the United States has done wonders for corporate profits and upper-income pay, but it has hardly budged hourly wages. Explosive growth in countries such as China and India means that workers here not only have to compete against workers in these countries for jobs but also for natural resources such as oil.
Rising fuel prices will have some impact on overall spending patterns. Money that goes into tanking up is money not spent at Best Buy, Wal-Mart or Starbucks. Energy-consuming industries such as airlines and trucking will suffer.
But the biggest impact of rising costs might be social rather than economic. They will accentuate the growing divisions between those eking out a living and those who find themselves well-off.
The good news from today's oil price spike is that overall pain might be limited. The bad news is that it will be felt principally by those least equipped to handle it.
But....
High gas prices widen divide between rich and poor
Tue Aug 16, 7:49 AM ET
Though the price of gasoline has risen by more than 60 cents a gallon in the past year, economists have been quick to note that the impact has been limited. That's because the role of energy in today's high-tech, high-finance, health care economy is much smaller than it was in the 1970s, when surging energy costs wreaked economic havoc.
But though the current price spike is unlikely to generate stagflation or bring back WIN (Whip Inflation Now) buttons, it is being keenly felt by low-income workers, who spend a larger portion of their income on necessities such as food and fuel. For someone who drives 15,000 miles a year and gets 20 miles per gallon, a 60-cent jump means an extra $450 a year at the gas pump.
Though that might not seem like such a big deal to those in the more comfortable classes, it's far from trivial for workers already struggling with soaring costs for housing and health care.
Consider the cruel calculus of rising fuel prices faced by low- and moderate-income workers in high-priced communities. Many have been forced in recent years to commute longer distances because of rising housing costs. Now, they have to pay more to commute.
Adding to the misery is a undeniable fact: Oil prices are rising because of economic growth both at home and abroad that many workers are not benefiting from. The recovery in the United States has done wonders for corporate profits and upper-income pay, but it has hardly budged hourly wages. Explosive growth in countries such as China and India means that workers here not only have to compete against workers in these countries for jobs but also for natural resources such as oil.
Rising fuel prices will have some impact on overall spending patterns. Money that goes into tanking up is money not spent at Best Buy, Wal-Mart or Starbucks. Energy-consuming industries such as airlines and trucking will suffer.
But the biggest impact of rising costs might be social rather than economic. They will accentuate the growing divisions between those eking out a living and those who find themselves well-off.
The good news from today's oil price spike is that overall pain might be limited. The bad news is that it will be felt principally by those least equipped to handle it.
