Whether you're left, right, Republican or Democrat, and whether you drive a car or a bicycle, the cost of gasoline in America affects you.
The cost of gasoline affects your neighbors and your community. It makes it harder for people you know and work with to pay for food and transportation. It makes anything derived from petroleum -- and that list is longer than you may realize -- more expensive. None of that is good for the economy -- and none of that is good for American families.
But let's be clear: we aren't facing a gas crunch. On the contrary, Exxon Mobil, BP and the rest of their ilk are still getting as much oil out of the ground today as they were six months ago.
What we're facing today is a "futures" problem. Instead of facing a gas shortage, the markets see Libya, and the unrest in the Middle East, and then costs escalate. Players in the gasoline market are looking at long-term signals and betting on a shortage of gasoline in the future.
With this is mind, I think President Obama should embark on a two-pronged approach. First, he must address and ease the immediate escalation of gas prices to ensure our economy doesn't slip into a double-dip recession. Second, he must craft and implement a long-term strategy that will kick our oil addition once and for all.
For the short-term fix, Obama needs to send signals that tell the market that he's moving on solutions to both our present woes and our future calamities. To send these signals -- which will put the brakes on rising prices at the pump -- the president could:
- Open the Strategic Petroleum Reserve. The reality is that these reserves only hold oil, which would still need to be refined. So this action would have zero impact on the availability of gas today. But availability isn't the issue. Opening up the reserves would be a major signal that could calm the jittery market. And as soon as prices start dropping, he can close up the reserve again.
The assumption that pain at the gas pump will force Americans to change their behavior has some historical merit. But I can't in good conscience tell anyone that it makes sense to do nothing about rising gas prices. Indeed, I don't think anyone can credibly tell the president to simply ignore the politics of this problem. We absolutely want to mitigate climate change. But shocking our economy into a double-dip recession isn't the path any president should take.
As for a long-term strategy, President Obama already gets that. He knows this is really about a lack of choice in the marketplace. Until we do a better job of giving American consumers real choices -- real alternatives to cars that rely on gasoline -- it's not fair to saddle them with cost of this crisis.
We are a nation built upon the gas-powered automobile. When cars came in, we threw out streetcars and left most public transit options for densely populated urban centers to figure out. This has left us horribly dependent on our cars and the gasoline that powers them. Our demand for both is as inelastic as ever: as gas prices rise, we grit our teeth and pay them. Otherwise, we couldn't get to work, couldn't get our kids to school, couldn't buy groceries or visit a sick relative at the hospital. We are largely a nation of consumers with two transportation choices: to drive, or not to live.
We fix this with choice. Until we have a million electric vehicles on the road, supported by an interstate network of charging stations, or until we've scaled down the cost of hydrogen and biodiesel-fueled vehicles and connected American cities with high-speed rail, the average American's pool of transportation choices won't grow. This is why my organization is hard at work in Arizona and across the nation to promote EV technology and foster understanding of its benefits to consumers. This is also why it's so important that our leaders are thinking big and taking action on this issue. Apart from very real concerns about global warming and environmental degradation, there are very present concerns of poverty and survival, and these concerns are inseparable from how much it costs American families to get from point A to point B.
The solution for today's crisis is two-fold: send a series of signals that tell the markets that the future will be OK. And work aggressively to secure that future for all of us.
Brian Keane is the President of SmartPower, a non-profit marketing organization funded by private foundations to help build the clean energy marketplace by helping the American public become smarter about their energy use.
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