Gas Gap: Americans at the Pump
“Poverty is like punishment for a crime you didn’t commit.” — Eli Khamarov
TIME recently reported that, “Energy costs have risen 31% at an annual rate so far in 2006. That ripples through the rest of the economy, showing up as fuel surcharges on services like airline tickets (up 7.9% so far this year) and higher prices on pretty much anything that travels before reaching the store.”
The same goes for employees trying to reach work. Joseph Godina, a truck driver with a long commute (a workday round-trip of 200 miles) in the Los Angeles area was interviewed for an article in the LA Times on Sunday entitled being Pinched at the Pump. He says, “The gas is just really hurting me. I don’t know what to do. I can’t quit my job or I’d lose my house.” He put a call into Visa to check his available credit before filling up. He has already maxed out his gas cards.
Elizabeth Douglass interviewed him and others being impacted by the high gas prices. Many of these people were barely getting by before and now they are falling further behind. She writes, “The wallop is worsened by interest rates that are at their highest levels in more than five years, boosting adjustable rate mortgages and credit card bills and jacking up the minimum payments on most credit cards.”
Back to TIME’s tutorial on inflation… “The Fed raised its benchmark rate by a quarter point last month, the 17th straight increase, in its effort to gently brake the economy by reining in spending.” Are consumers hoarding money just to pay for gas??
Ask Godina. “As his plight illustrates, the fiscal fallout already is showing up at the lower end of the wage scale. And anecdotal evidence suggests that high gasoline costs are forcing people to make adjustments at nearly all income levels.”
“A recent survey for the National Retail Federation found that 42% of households with incomes of less than $50,000 were dining out less than frequently because of high gas prices and the 33% with higher incomes had cut back on eating at restaurants.”
“Gasoline prices are clearly taking a bite out of the consumer, especially among people who are at the margin.”
The margin… hmmm… another name for the population that is Nickel and Dimed. The gap continues to expand between the rich and the poor in this country. Gas prices aren’t really impacting the rich. The middle class feels the pinch, but most of us are just adjusting expenses. An increase in one column is covered by cutting back in another. The poor are just getting screwed. It’s sad really. I’m not sure what the answer is to the problem. It’s just front and center on my mind after reading about it.