How then, do we move backwards? How does a society, with most of the people having no clue of future events, move from being dependent on a vast and intertwined network of goods and services produced by the indigenous people of whereever, to a local resource and renewable energy based society, and do so in the timeframe available (20-30 years using the most liberal extimates, 10-20 with resonable estimates, 5-10 with worst case scenarios), all the while prices on everything increasing, world politics getting more militaristic, governments continuously reducing civil liberties, shortages of goods on the market and weather patterns resembling bad Hollywood movies?
Posted: Wed May 23, 2007 1:33 pm Post subject: Why We Aren't Cutting Back Like in the 80's
This analysis from the EIA is really interesting for explaining why American drivers don't seem to care as much about $3.20 gas as we did about $1.40 gas back in the early 1980's. Follow the link to the spreadsheet that shows the real price per mile, and you see that because cars were so much less efficient back then, the real price per mile driven was about 50% higher back then. That means we've got to get to about $4.60 gas in today's dollars before people are impacted the way they were in 1981.
Posted: Wed May 23, 2007 1:47 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
Oh! And for real fun while you eat your lunch, take that spreadsheet and insert your own assumptions about the price of gas next month and next year, and see what happens to the price per mile, and then compare that to the early '80's. _________________ Just another tofu-munching bike-riding Rambo(/Rambette)
Joined: Jun 03, 2005 Posts: 212 Location: New Jersey
Posted: Wed May 23, 2007 2:20 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
Haha, a new concept - "new nominal record high" - I wonder when they switched over to that formulation. Meantime, the disposible income of people has stagnated or gone down. People have a lot of places to cut before they cut gas consumption though - bottled water, for example.
Posted: Wed May 23, 2007 2:22 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
Pixie wrote:
Follow the link to the spreadsheet that shows the real price per mile, and you see that because cars were so much less efficient back then, the real price per mile driven was about 50% higher back then. That means we've got to get to about $4.60 gas in today's dollars before people are impacted the way they were in 1981.
I'm guessing that they 'forgot' to mention that VMT is double what it was in 1981? --which means our fuel 'efficiency' should be double what it was in 1981 just to break even, to say nothing of population gains, immigration, etc. _________________ "It's called the American Dream because you'd have to be asleep to believe it."
Joined: May 19, 2005 Posts: 759 Location: Merry Ol' USA
Posted: Wed May 23, 2007 2:46 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
emersonbiggins wrote:
Pixie wrote:
Follow the link to the spreadsheet that shows the real price per mile, and you see that because cars were so much less efficient back then, the real price per mile driven was about 50% higher back then. That means we've got to get to about $4.60 gas in today's dollars before people are impacted the way they were in 1981.
I'm guessing that they 'forgot' to mention that VMT is double what it was in 1981? --which means our fuel 'efficiency' should be double what it was in 1981 just to break even, to say nothing of population gains, immigration, etc.
What emerson said. Although it's not quite double, the increase is very significant, and applies to 2 vehicles in each household on average. I made a post on these numbers if you look up my posts.... _________________ After fueling up their cars, Twyman says they bowed their heads and asked God for cheaper gas.There was no immediate answer, but he says other motorists joined in and the service station owner didn't run them off.
Posted: Wed May 23, 2007 4:07 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
The important comparison would be real median household transportation (or energy) expenses as a percentage of total household expenses (or income); 1970s/80s vs. 00s. Of course, preferably adjusted by the PPI deflator, instead of the messed up CPI deflator.
You have to remember that the price increases for gasoline started in the 70s, not the 80s. The early 80s saw a short, sharp increase in gas price at the same time as a severe recession. However, all of that was primed by nearly a decade of energy price turmoil. People in the early 80s were ready to believe that prices were going to be unaffordable. We're closer to the early/mid 70s at the moment in terms of expectations.
Joined: Jun 12, 2005 Posts: 4189 Location: 1st territorial capitol of AZ
Posted: Wed May 23, 2007 4:11 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
kjmclark wrote:
People in the early 80s were ready to believe that prices were going to be unaffordable. We're closer to the early/mid 70s at the moment in terms of expectations.
Wow, I just wasn't aware of this in the early/mid 80s, I was riding the bus or walking etc., far too poor to own a car, I just remember lots of new cars being small, like the Honda CRX.
Posted: Wed May 23, 2007 5:08 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
I_Like_Plants wrote:
kjmclark wrote:
People in the early 80s were ready to believe that prices were going to be unaffordable. We're closer to the early/mid 70s at the moment in terms of expectations.
Wow, I just wasn't aware of this in the early/mid 80s, I was riding the bus or walking etc., far too poor to own a car, I just remember lots of new cars being small, like the Honda CRX.
Interesting. A friend of mine said the same thing: "I was riding my bike."
Late 70's/early 80's, you first started seeing cars advertised on the basis of their mileage. You saw the appearance of bike lanes, HOV lanes, mass transit made a little bit of a comeback, and people were encouraged to carpool. That all mostly went away around '85, when the real price of gas went down and people forgot about the gas crunch. Since then, the only efficiency gains we've made are because the big old cars from the '60's have broken down and been towed to the junk yard.
I agree with KMJClark that we are in a '70's mindset right now. Prices are high, but gas still flows, so don't hold back. But if the price spiked into the $4 range, or we actually had a SHORTAGE for a few days, then you would see a real change of paradigm in the public mind.
Here's what I find interesting: American refineries are producing less gas than say 2004, but we are driving more. How are we doing that? We are importing gas. That means that someone is cutting back for us, and I assume it is the poorest nations that can least afford the cost of gas. The Industrial Revolution is a Last-In-First-Out sort of thing. _________________ Just another tofu-munching bike-riding Rambo(/Rambette)
Joined: Sep 25, 2004 Posts: 4346 Location: Boston, MA
Posted: Wed May 23, 2007 5:28 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
We get a lot more bang for our barrel of oil these days.
In order to have the same % of GDP dedicated to energy consumption, we would need a doubling of inflation-adjusted 1981 prices. _________________ "www.peakoil.com is the Myspace of the Apocalypse."
Posted: Wed May 23, 2007 5:42 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
Tyler_JC wrote:
We get a lot more bang for our barrel of oil these days.
In order to have the same % of GDP dedicated to energy consumption, we would need a doubling of inflation-adjusted 1981 prices.
Doubling? I look at your figure and still get 50% rise. 0.7 now versus 1.0 back in 1981? _________________ Just another tofu-munching bike-riding Rambo(/Rambette)
Joined: Sep 25, 2004 Posts: 4346 Location: Boston, MA
Posted: Wed May 23, 2007 7:35 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
My mistake, I misread the chart.
OK, so we would need energy prices at least 50% above the inflation adjusted 1981 mark.
However, if you'll notice something interesting. Energy intensity from 1975 to 2005 decreased by nearly 1/2.
Meaning that in 6 years, from 1975 to 1981, energy intensity decreased by 25%!
That's an incredible number.
That would be like the United States today decreasing its oil consumption from 21 million barrels per day to 16 million barrels per day in 6 years.
So even if supply declines by 5 million barrels per day, America could have the same standard of living if we simply conserve as well as we did 3 decades ago. _________________ "www.peakoil.com is the Myspace of the Apocalypse."
Posted: Wed May 23, 2007 7:59 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
Tyler_JC wrote:
Meaning that in 6 years, from 1975 to 1981, energy intensity decreased by 25%!
That's an incredible number.
That would be like the United States today decreasing its oil consumption from 21 million barrels per day to 16 million barrels per day in 6 years.
So even if supply declines by 5 million barrels per day, America could have the same standard of living if we simply conserve as well as we did 3 decades ago.
Not quite.
Most of that 25% decline came from industry efficiency gains, while vehicle gasoline consumption actually increased during that time. _________________ A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
Live in Arizona? Check out: http://sustainablearizona.org and read my blog.
Joined: Sep 16, 2004 Posts: 4227 Location: Southwest WI
Posted: Wed May 23, 2007 8:19 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
Yeah but computers are cheaper... _________________ "Oil is going up because we use too much oil, and the capacity to replace reserves is dwindling"
-President Bush 11/07/07
Posted: Wed May 23, 2007 8:47 pm Post subject: Re: Why We Aren't Cutting Back Like in the 80's
Tyler_JC wrote:
In order to have the same % of GDP dedicated to energy consumption, we would need a doubling of inflation-adjusted 1981 prices.
OK, but IMHO, since the question was why aren't motorists cutting back like in the 80s, the GDP number isn't relevant. There are three reasons. First, GDP is not evenly distributed, so that really tells you very little about the ability of the less-than-median households to pay for gasoline. They are the ones who will be forced to cut back first, unless we move to rationing of some form.
Second, we have exported a good deal of our energy usage to other regions, from which we receive finished goods. We produce much more GDP as services now, and less in the form of manufacturing as a result. To me, that means that energy expenses for manufacturing will reach here as finished goods inflation, not mostly as higher prices at the pump.
Finally, the chart you used is energy overall, but the question is about liquid transportation fuels. A more interesting chart would be GDP attributable to transportation vs. total transportation energy usage. Here's something similar:
This is at DOE's Energy Efficiency and Renewable Energy group.
Overall for the transportation sector, energy intensity declined 14% from 1985 to 2004. Not quite as impressive.
And even that is bunk. If you think about it, they're saying that we travel more efficiently, given that we travel much more. Since a flight is generally more efficient per person than an equivalent car trip, more trips by plane counts as better energy intensity in that calculation. Overall passenger transportation energy consumption has increased over 38% during that time period [EERE]. Population over that time has increased 23% (237,923,795 to 293,638,158 according to Census.gov). The EIA Annual Energy Review says that transportation energy use increased 40% over that time period. That comes to 13% increased transportation energy per person over that time period.
Personally, I don't buy that there is any real societal benefit for people driving 50 mile commutes. From my perspective, 13% increase in transportation energy use per person is an increase in energy use, even if it means that the gas was burned in a higher mpg vehicle. Again, I think the important number is percentage of median family disposable income going to transportation.
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