Thursday, April 24, 2008

Running on Empty

I know that gas prices are starting to catch my attention when I consider a good week not by the receipts in my law office but by the number of fill ups in my car. When we all swell with pride that NJ has possibly the lowest gas prices in the nation at well over $3 per gallon, we are engulfed in our own gas wars . How bad has it really gotten?

In a report of April 16, 2008 from InflationData.com, it was stated that "with average March prices at $3.22 Gasoline Prices are above the average annual prices paid at the all time peak in 1981". That was the year the Iran-Iraq war started.

For perspective, in 1955 the average gallon of gasoline sold for 29 cents. In 1972, the year before the Arab oil embargo, prices were only 36 cents per gallon.Adjusted for inflation, a May 2006 report of the Cato institute stated that , in 2006 dollars, this would translate to $1.76 (for the 1955 gasoline) and $1.36 (for 1972).

While prices had climbed to 60 cents per gallon in 1976, they zoomed to $1.35 in 1981. Inflation Data stated that this gallon would cost $3.17 in today's dollars. We have now surpassed that figure and established a record of which none of us (except the oil companies) is proud.

When we have to consider whether to use our car for leisure, when the airlines have to charge us for every possible 'amenity' in an effort to somehow keep from going under, when food prices soar in part because of the cost of getting goods to their destinations, then there is something badly broken in the system.

When statistics tell us that gasoline is now a precious commodity, this only serves to reenforce our innate understanding. When one of the main attractions of our state is its gasoline prices, and when one takes a trip to our gas stations, but not to our beaches because it costs too much to get there, we are all going nowhere fast.

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