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Business News/ Politics / News/  Oil prices and the changing American way
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Oil prices and the changing American way

Oil prices and the changing American way


For months now doomsday prophets and the US media have been going on endlessly about soaring oil prices and how it is affecting everything about the American way of life, including visits to grocery stores, discount malls and expenses on luxury apparel and accessories.

But what seems to have outraged this country and its media more than anything else seems to be the fact that Americans were duped out of their right to go vacationing over this long memorial day weekend, which is when families take out their large SUVs and hit the freeways to go to LA, Vegas, Niagara, wherever.

With gas prices hovering close to $4 this weekend (and more in some cities), popular nationwide motorist’s body AAA, predicted that fewer Americans would hit the roads and more would prefer staying closer home.

Already, the federal highway administration said here this weekend that Americans have traveled 11 billion miles less in March 2008 than in the same month last year. Everyone has been hurt by spiraling oil prices. The big three auto companies — GM, Ford Motor Co., and Chrysler — have announced production cuts in large trucks and SUVs, vehicles Americans love to buy. Used car dealerships are a telling sight of the American plight, with large pick-ups and SUVS now dominating the horizon with "For Sale" signs.

At the neighborhood YMCA, middle-aged moms talk endlessly about how they had to cancel their much awaited family vacation due to the price of gas or, even worse, how they cannot any longer afford to spend too much on hair colour or their nails, since gas takes up so much of their weekly budget.

The Congress has just finished up an annual summer exercise — the lining up of oil company executives to haul them up over the coals about the single most uniting factor in this country. Everyone is mad about oil prices that have gone up over 24% in the last year, including President George W Bush who is just back from a visit to Saudi Arabia where he requested the country to produce more oil.

Solutions of all kinds are being tossed up from every quarter, from democrats who wants oil company profits taxed, to others who want the federal government to release oil from its strategic petroleum reserves — a stockpile to hedge against any sudden disruption of supplies a la the Arab oil embargo of many years back.

Smart solutions

But while the whiners and cribbers continue to rue their fate, a handful of others, in the true American spirit of enterprise, have found ways to work around the problem.

Earlier this month, automaker Chrysler LLC announced it would offer customers a gas price protection policy that would protect them from further hikes. The "Lets refuel America" program gives consumers registering for the scheme and opting to buy eligible Chrysler, Jeep and Dodge vehicles a card that gives them gas at $2.99/gallon, with the car maker paying up the difference for three years.

The scheme is available at 3,521 US Chrysler, Jeep and Dodge dealerships through 2 June 2008, on vehicles ranging from popular new compacts, crossovers and minivans to full-size diesel-powered pickup trucks.

San Francisco where gas prices are among the highest, recently saw Washington, DC-area choir director Rocky Twyman organize a prayer meeting in the expensive Bay Area, to bring down gas prices at a local Chevron gas station. Last month, an Iowa church announced it would offer a 25-cent discount to members who bought fuel and said this would facilitate families reeling under the heat of soaring gas prices, to attend Easter services. The church said it did not care even if it was greed that brought the members in!

One resourceful hospitality company actually put out ads luring vacationers to its resort during Memorial Day weekend by offering, among other things, bargain room rates at its resort and free gas vouchers, but only when the vacationer turns up in person at the resort.

And while these might be short-term fixes to get over what now looks like something Americans will have to learn with — gas prices are expected to touch $6 a gallon in the medium term — others are finding more permanent measures to get around the problem.

Long-term steps

The Massachusetts Bay Transport Authority (MBTA), the body that runs the commuter rail, the subway , harbour cruise and road transport is now undertaking an exercise that will allow cost- and environment-conscious people in the state to bike to work, at least partially.

Already work is in progress to allow office-goers to cycle to the nearest bus or T-station, load their cycles in a few reserved compartments and on reaching their destination, cycle to work. Work has started at a large, busy T-station terminus, at Alwife, where cyclists with Charlie Cards-the American version of the railway ticket, can park their cycles in designated bike cages and walk/take the bus to work. At least one weekend commuter rail bike coach, headed to the city’s south shore area, will allow families enjoying their summer to enjoy without worrying about gas prices or parking space for their cars.

The MBTA has other plans as well up its sleeve. Coming up ahead, it will be equip city buses with bike racks-at least five by the end of the year and the entire fleet in the next three years, spending some $300,000 on the project. It hopes that making its transport system cyclist-friendly will make people switch to public transport, thus making it a richer organization and the city less polluted. Simultaneously, it will save money for those who opt to bike to work.

Meanwhile, with the end of this long weekend, industry watchers are hoping that gas prices will come down, at least temporarily, once Americans get back from their vacation and put their nose back to the grind.

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Updated: 27 May 2008, 06:08 PM IST
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