Gas Prices Now and Then

Tibor R. Machan

Cologne, Germany. During the last several years that gasoline prices
posted at pumps were steadily rising I have run across a few obscure
articles, mostly produced by economists, which claimed that the actual
price of gasoline is now lower than it was back in the 1970s when we had
the nuisance of all those long lines at gas stations. I am no expert at
this stuff but I have noticed something that seems to lend credence to the
economists’ claim: there are innumerable huge SUVs, minvans, and similar
gas guzzlers still all over the road in my neighborhood and wherever I
have been doing some driving (Florida, Washington, DC, Maryland, Alabama,
Georgia, Louisiana, and South and North Carolina).

While the posted prices are, of course, huge compared to what they used to
be, it appears, from what these economists tell us, that the actual
percetage of people’s income spent on gasoline is less now than it used to
be some thirty years ago. And given how many folks are hanging on to their
gas guzzlers, it looks like the economists are right.

What is puzzling me to no end is that virtually nothing about this is
discussed in mainstream media. No front page article has appeared in The
New York Times, The LA Times or other papers with which I am familiar, and
certainly none of the TV news programs have sent out reporters to check
out the economists’ contention. Why? Is there something to be gained by
the press from hiding from readers and viewers the possibility, even
probability, that there really is no extraordinary oil crises? What if it
is all as it had been for several decades now, neither a smooth ride yet
not as bumpy one as mainstream opinion would have it? Is there something
dangerous about letting folks know that the real price of gasoline is
actually lower than it was back in the early 1970s when in today’s dollars
gasoline cost about $6.50 a gallon?

Of course, gasoline has been quite a lot more expensive in Europe than in
the US for decades on end. And the difference is still evident. So
Europeans do tend to drive much smaller cars than Americans. Even allowing
for the fact that changing from a big to a smaller or really small
vehicles is not going to happen overnight, no major adjustments are
evident on America’s roads. What change has come about can be written off
as panic reaction instead of prudence. Of course, for some people
adjustments may be warranted, but that’s true anytime, given that the
market favors different producers and consumers based on productivity, the
fluctuation of supply and demand throughout the economy.

Nevertheless, it seems that oil prices, though high, aren’t actually
higher than they have been for decades. So why is this not explored by
investigative journalists across the land?

Perhaps the answer is simply that good news is no news. So if there is no
oil crises then writing and talking about oil is worthless from the
viewpoint of the media. No one makes a big deal of the fact that there
haven’t been many air crashes in recent years–no headline blares that
"Millions of passengers have reached their destination safely." On the
other hand should there be one or two crashes, this is going to be major
news everywhere even if on average flying is far safer than, say, driving
and ride bicycles.

Perhaps the lesson from this is that hardly anything one reads in
newspapers or views on TV should be taken at face value. One needs a
healthy dose of skepticism whenever one relies on conventional news
sources. But maybe there is an opportunity here as well: given that so
many newspapers are having economic difficulties now, what with the
Internet posing a major challenge to their economic base–namely,
advertising (especially classifieds)–some experimentation with reporting
more good news may be the answer.

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2 Responses to

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