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An Inconvenient Economy

On Friday, the price of oil jumped a record $10.75 per barrel, to more than $138, immediately sending the dollar into a freefall and causing the Dow Jones to ask for a sick-day. Meanwhile, unemployment rose at a record-setting pace in May and energy costs have continued to seek the cooler temperatures at high elevations.

On Friday, the price of oil jumped a record $10.75 per barrel, to more than $138, immediately sending the dollar into a freefall and causing the Dow Jones to ask for a sick-day. Meanwhile, unemployment rose at a record-setting pace in May and energy costs have continued to seek the cooler temperatures at high elevations.

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All of this economic misery has Americans feeling desperately in need of some good news, but judging by a survey conducted by Ipsos Public Affairs last week on American driving habits (see the results here), it looks like Americans may be spending more time at home this summer. More than a quarter of Americans polled in the Ipsos survey said that they will be cutting back on non-essential driving over the summer, and unfortunately, for many, travel and recreational driving will be the first to go. Errands were next on the list, as one in five Americans revealed they will make fewer trips to the local bazaar.

The good news (which is not good news for most) is that—this summer—we will all be getting a little “greener.” With no end in sight for soaring oil prices, green habits are no longer simply for those who can afford to shop at Whole Foods. According to the survey, the spike in prices at the pump will have the greatest effect on households with average annual incomes under $50,000 and families with children under eighteen (which is more than 50% of the American population according to this data). In rural areas, especially across the rural South, the price of gasoline is forcing families to choose between food and transportation. On average, American households are spending 4% of their take-home income at the pumps, but in parts of the Mississippi Delta, for example, that figure can be as high as 13%.

When an economic squeeze forces Americans to become vegetarians in order to save that extra dollar for the pump, the problem is undoubtedly serious. Desperately serious. Though we may have found a short-term treatment for our national obesity, the effects of our petrocentric economy have finally touched the majority of Americans, and there’s really nothing funny about it. It is now crystal clear that we can quite literally no longer afford to tow the old party line.

At $4 per gallon, 65% of Americans have fundamentally changed their driving habits. At $5 per gallon, Ipsos speculates that 85% of Americans will have altered their daily driving routines. For a dependent economy, a continued rise in the price of oil might be for the best, forcibly bringing about renewed national energy policies. But while many remain unable to afford fuel-efficient vehicles, and as airlines raise prices and cut flights, the price of gas will continue to sting. As such, carpools and public transportation—where available—are only the first step in finding welcoming alternatives to our gasoline-induced cash-flow problem.

At the outset of his film “Addicted to Oil,” New York Times columnist Thomas Friedman warned: “this is not your parents’ energy crisis.” An inconvenient truth, to be sure, but one that Americans can no longer avoid. The necessity of developing alternative sources of energy have never been more immediate. From the bottom up, we are feeling the effects of an incoherent and deficient national energy policy. Regardless of whether or not you feel Tom Friedman deserves a green pie in the face, our transition to a more fuel-efficient economy will not (and cannot) end with conservative driving. Truly, smaller carbon footprints for man will become a giant leap for mankind.

What can the average American (and the average American business) do to become more energy efficient?

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