National Journal Panel: Dollar Gas?

"What Does $1.67 Gasoline Mean for the Future?"

- by Eric Britton, 6 January 2009, New Mobility Partnerships, Paris and Los Angeles

- Prepared for the Transportation Panel sponsored by the National Journal. See footnote below and http://transportation.nationaljournal.com/contributors/Britton.php for details

What about one to ten dollars a gallon?
$1.67 is an interesting number, but suppose we look instead at a broad range of possible prices -- for example something in the order of anywhere from one to ten dollars a gallon. Now that is an interesting question. What does spread like this mean for national policy? And If you are uncomfortable working with that huge range, well you better get used to it because it is just one example of what we call the New Normal. That's the kind of thing that we need to be prepared to look at, understand, and work to make wise policy. That's our future. And we can either make it or wait for it to happen to us.

To make some sense of this and lend what I hope will be a helping hand to the incoming transportation team, I would like to look at the future of continuing large swings in the price of gas at source and at the pump from two very different perspectives. The first is that of someone born and raised in a rural small-town environment in northeastern Mississippi, which today looks a great deal different from how things were when I was a child there. The second is from the vantage of a strategic planner with a special interest in the politics of transportation from both a sustainability and global perspective. I would then like to see if we can find a way to put our heads together in order to piece the best ideas/opportunities of these two presumably polar positions together for policy purposes for the incoming administration. I am sure we can do it.

Let's start with the Mississippi perspective. In many ways a typical citizen's-eye of what this is all about.

Letter from Mississippi

Today down in the lightly settled rural areas around my hometown of Amory Mississippi there are at least three unyielding realities which most of our friends and neighbors have to figure out how to live with every day.

• First, that the time in which our town was a lively place which served to provide both the people who lived in town and surrounding communities with a wide range of goods and services all within walking or biking distances somehow disappeared in the closing decades of the last century. No one here is quite sure of how or why it happened -- but it did and it was a great loss. One that we really start to feel as the price of gas climbs.

• The second harsh reality is that as the town emptied out the only possible way of getting around today is . . . if you have a car. A very American phenomenon. But there is more to it than that.

• The third is that most of us down here are not particularly rich, meaning that when gas prices double, triple worse, it hits us a lot harder than the average American. We are not only one of the poorest states in the Union, but today more than 20% of our neighbors live below the official poverty level. And a lot more than that if you are a rural white and sadly worse yet if you are a rural black.

So as an average citizen from northeastern Mississippi I have some questions about how the new team in Washington is going to deal with the harsh realities we face both now and will surely have to face in the years ahead. This is one problem we can be sure is not going to go away by itself.

To be perfectly frank certainly the most comfortable solution for us would be a return to dollar gas. One of the great conveniences of that is that it would allow us to keep going as we have over all these last years without changing. Nobody really likes to change, at least when they feel it's being forced on them. But we look around and we know that the world is changing, and I guess that includes us to.

So the question becomes: how do we live down here with three or four or five dollar gas? I guess we had to start thinking about that now. And at five dollars a gallon we are definitely going to have to be thinking more about transportation and access, and less about cars per se -- at least as we always have in the past.

A lot of ideas come to mind as to how to deal with this, but since most of them are kind of unfamiliar, we're probably going to need some help in developing basic organizational and even legal support in order to make them work.

Here are a couple to think about which would be important for us and for many people who lived in small towns and rural areas across America:

1. We don't have very many taxis around here, and the ones we do things To cost a lot. But if we can figure out how to get more people into the taxis so as to drive down the costs and at the same time put more of them on the road, well that might be the start of something interesting.

2. Much in the same spirit, we have a lot of people who have both cars and plenty of time on their hands to serve as informal but still effective taxi. If we could only organize to find a system to make this work.

3. We used to hear something about car and van pooling which was used by some of our local industry employers, back when we had still local industry. That has to be an idea we could revisit, both for getting to work and for other important trips as well.

4. Likewise we have a fair number of church and school buses in the county, most of which sit around empty 95% of the time. Surely we can do something more with them.

5. And then what about working out some things where people want to share a car when they need it, and not have to pay the full expenses involved in owning and operating your own car.

6. There is almost no provision for cycling in this area, and there surely have to be some interesting things we could do to encourage and support this form of low-cost healthy transportation. That plus better and safer sidewalks and other protection for people who want to walk.

7. We used to walk a lot before we started to depend on cars, and I know there are a lot of people out here who would like to be able to do it again, if only there were a place to go to within walking distance.

Maybe I should add in closing that we have figured out that there is more to it than just cars, transportation and the price of gas at the pump. Maybe some of you up there should be telling us how we can get back to towns and small rural centers that offer something more than an empty street and closed storefronts. That has to be part of our solution strategy, wouldn’t you say?

Back in the days of the War Between the States, our part of Mississippi for a long time resisted pressure to secede from the United States of America. We were and are to this day proud and independent people. But what we now need from Washington are some clear signals and a good understanding of the realities we face every day.

We're waiting to hear from you. And you will find that we are ready to do our part.

From a global perspective

My fourteen distinguished colleagues who have already weighed in with their views and counsel on this question here have covered a lot of the most important bases for which I'm grateful. They make a good read so no reason for me to try to cover the same terrain.

Instead, let me now take a couple of steps back from the heat of the action and share with you my thoughts on how this looks from a global and more strategic sustainability perspective. When we step back from the stove a couple of important things become clear:

1. We are going to see continuous, at times violent and in any event uncontrollable swings in the price of fossil fuels in 2009 and in the years ahead. This is the inescapable reality of the future, the New Normal.

2. At no time in the past have we seen such wide, rapid and unpredictable fluctuations. This suggests to me that whatever our future policy is, it better be very different from the past. In other words if it looks familiar we can be pretty sure that it is not going to work.

3. So we have to know that we have to innovate and we have to dare.

4. It is my firm belief that this high volatility can be turned toward to our advantage if we tackle it in a sufficiently strategic and politically savvy manner. I and a thousand others have written in the past that "a crisis is a terrible thing to waste". And since this is an excellent case in point, I hope that we will now find a way to put our brains together to make sure we don't waste this one

5. However unless there is a tidal change in our approach, the likelihood is that we are going to lurch from one hapless piecemeal “solution” to another and in the process show ourselves as unable to assume the responsibilities of good governance. This is no time for complacency and wait-and-see or more of the same. I would say that we have done enough waiting and seeing for at least the next eight years.

6. The reality is that we have all the tools needed to engage a policy based on strategic, steady and significant increases in price at the pump. This is needed for all the reasons which my colleagues here have pointed out very well and which I therefore need not repeat, while at the same time ensuring that those who today are both highly dependent on their cars will not suffer – excessively, unnecessarily, inequitable -- from the necessary strategic price increases.

So we know what we have to do, and that is to work out and implement a clear game plan for these steady price increases and everything that is needed to soften the edge, beginning immediately. If Europeans can live with gas at close to $10 a gallon, Americans can too. And this can be achieved moreover without a sacrifice in life quality.

All we need is leadership to show the way.

Eric Britton

PS. I'm reading a fine book by James M. McPherson on the leadership challenges that then-new president Abraham Lincoln faced when he arrived in Washington, DC in 1861. The book, "Tried by War”, which I strongly recommend to you, offers a number of striking analogies to the situation and the stresses that President-elect Obama is undoubtedly going to have to face and deal with when he takes office in less than two weeks time. President Lincoln had plenty of advisors and plenty of generals, but things began to move in the right direction only when he took charge of it himself. That’s leadership.

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The above was my third invited contribution to an ongoing "insider policy discussion" sponsored by the National Journal In Washington DC , which has as its intention to provide counsel to orient and guide the incoming Obama administration on matters involving policy and investments in the transportation sector. This piece specifically in response to Discussion Topic: “What Does $1.67 Gasoline Mean for the Future?” which opens with the statement (Lisa Caruso) : “When gasoline hit $4 a gallon last summer, many Americans started driving less, buying more fuel-efficient cars and taking public transportation. But now that gas is much cheaper, Americans may make different choices. With fuel prices and consumer demand so variable, what is the best way to encourage investment in greener, more fuel-efficient alternatives, and what does this uncertainty mean for long-term infrastructure planning?”

• To access the discussions http://transportation.nationaljournal.com.

* You can contact the author at +1 310 601-8468 in the States or +331 4326 1323 in Europe. In either place eric.britton@newmobility.org for email or Skype: newmobility work just fine.

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