For however painfully acute Hurricane Katrina’s devastation was on the southern Gulf region, its economic impact is proving much less discriminate. There are few Americans who’ve been spared from the storm’s economic aftermath, as rising energy costs are draining drivers at the gas pumps and forcing many Americans to curtail spending elsewhere. But while unfortunate, the recent surge in petroleum costs must be considered in context. Much more than a temporary spike, Katrina’s impact on the price of gasoline and oil is but the most recent warning of a looming energy crisis. If lawmakers really have the public’s interest in mind, they’ll make it a priority to avoid that crisis, even if it means letting drivers suffer in the short term.
After gas prices topped $5 in Georgia, legislators temporarily suspended the state’s gas tax. Lawmakers in Oklahoma, Massachusetts, Connecticut and Pennsylvania followed suit and are still considering further options to lower prices. A similar proposal passed in the Michigan state House. But while noble in intent, price-relief measures are shortsighted efforts to delay the American public’s all-but-inevitable introduction to the $100 barrel of oil – a point many analysts fear could drive the global economy into recession.
Various factors – from shrinking reserves in the Middle East to an unquenchable demand for energy in South Asia – have added to the gradual rise in energy prices in the last two years. And the upward price pressures that were present before Katrina ravaged oil installations off the Gulf coast will remain long after the storm leaves the news cycle. The only significant effect of rolling back gas taxes to lower prices at the pump, in the long run, will be to decrease state revenue at a time when many states are facing fiscal crises.
Furthermore, attempting to lower energy costs – as numerous states have done – gives drivers a false sense of security and removes incentives to alter consumption habits. Though the government has pushed for higher emission standards and increased motor efficiency, automakers still have carte blanche in designing new models. The United States is home to some of the most excessively large automobiles in the world, the Hummer a case in point. High gas prices should eventually lead to more efficient vehicle design and could help counter the advance of urban sprawl by providing a compelling reason to live in denser cities less dependent upon cars.
It is important to note, though, that the immediate effects of higher gas prices will fall most heavily on the poor. Without intervention, increasing numbers of lower-income Americans will find themselves unable to afford gas in a car-dependent society. Government, from the federal level on down, must improve public transportation to ensure that high gas prices do not stop those who cannot afford to drive from leading their lives.
The fallout from Katrina should be a wake-up call for Americans who’ve grown contentedly accustomed to an energy-intensive lifestyle. Cushioning fuel prices risks lulling America’s drivers into complacency. Only with a shift in consumer demand will U.S. energy policy begin reflecting the economic necessities of a diminishing energy supply.