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Gas Tax Holiday, Part 4: Report from the Field

[Bill Becker has written a great post, that we’re adding to the series.]

Joe has pointed out the folly — and the disappointment — of two supposedly climate-friendly presidential candidates proposing a suspension of the federal gas tax this summer.

I can’t resist adding a few notes from the heartland.

The Denver Post reports this week that commuters in that city are riding mass transit in record numbers. The Regional Transportation District, which operates the city’s bus and light-rail systems, reports it carried nearly 98 million passenger trips during the year that ended in February. That’s the largest number for any 12-month period in the agency’s 30-year history.

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Ridership on light rail alone averaged 68,000 passenger trips each day in February. RTD officials attributed the record ridership to the “high price of gasoline (and) a growing interest in environmentally friendly practices”.

The New York Times reports that “soaring gas prices have turned the steady migration by Americans to smaller cares into a stampede”:

In what industry analysts are calling a first, about one in five vehicles sold in the United States was a compact or subcompact car during April, based on monthly sales data released Thursday (May 1). Almost a decade ago, when sport utility vehicles were at their peak of popularity, only one in every eight vehicles sold was a small car.

The switch to smaller, more fuel-efficient vehicles has been building in recent years, but has accelerated recently with the advent of $3.50-a-gallon gas. At the same time, sales of pickup trucks and large sport utility vehicles have dropped sharply.

In another first, fuel-sipping four-cylinder engines surpassed six-cylinder models in popularity in April.

“It’s easily the most dramatic segment shift I have witnessed in the market in my 31 years here,” said George Pipas, chief sales analyst for the Ford Motor Company…

Previous spikes in sales of smaller cars were often a result of consumers trading down during tough economic conditions or gas-price increases. When the economy improved or fuel prices dropped again — as they did after the oil-price shocks in the 1970s eased — buyers invariably went back to bigger vehicles.

But with oil prices expected to remain high for years, auto industry executives are seeing a turning point.

“The era of the truck-based large S.U.V.’s is over,” said Michael Jackson, chief executive of AutoNation, the nation’s largest auto retailer.

Also this week, the Rockefeller family publicly scolded Exxon Mobile for failing to embrace alternative energy development. The majority of family members announced they will support resolutions that raise questions about the leadership of CEO Rex Tillerson and call for Exxon to invest more in technologies that cut greenhouse gas emissions.

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The family members supporting the resolutions own only about 332,000 of Exxon’s 5.4 billion outstanding shares, but their stock clearly has gone up among people concerned about global warming and tired of the oil industry’s record profit-taking at a time when gasoline has reached record levels ($3.62 at the time of this writing) and the industry is fighting efforts in Congress to redirect some of its federal tax breaks to renewable energy research and commercialization.

As difficult as rising fuel prices are for American consumers, particularly in this weak economy, what’s happening now is inevitable even without market manipulation by oil producers, because petroleum is a finite commodity in a growing world market. It had to happen sometime, and for the sake of reducing greenhouse gas emissions, it’s good that it’s happening now. It should have happened in the 1970s, when two Arab oil embargoes demonstrated how vulnerable our economy is to oil shocks.

Some people — truckers come to mind — have little choice but to buy fuel and relief may be justified. But many people do have mobility options, as the commuters in Denver and today’s car buyers are demonstrating. If the market price of gasoline drives them to exercise those options, to unhitch their household budgets from the vagaries of oil, to help reduce America’s energy trade deficit, to hold back some of those gasoline dollars that flow to countries that support terrorism, and to reduce greenhouse gas emissions from one of their biggest sources, then good on them and good on the marketplace.

Candidates McCain and Clinton should be urging Americans to reduce their high fuel costs by ride-sharing, taking the bus, hopping the train and cutting unnecessary trips, and urging bosses to allow their employees to telecommute a little more often. Instead, as Tom Friedman writes this week in the Times:

The McCain-Clinton proposal is a reminder to me that the biggest energy crisis we have in our country today is the energy to be serious — the energy to do big things in a sustained, focused and intelligent way. We are in the midst of a national political brownout.

National leaders need to help citizens understand, accept and adapt to the new realities of this new century. Rising oil prices is one of them. What we don’t need is pandering to voters and more schemes to keep oil company profits up, at the expense of America’s long-term prosperity and security.