If gas prices hold at their current $3 or so per gallon, most of us will be paying an extra $240 or so per year for fuel vs. what we were paying last year.
Here’s how it breaks down:
Regular unleaded is about 30 cents per gallon more today than it was around Thanksgiving. If you have a typical car, it has a 15 gallon tank, so it now costs roughly an extra $5 to fill up. If you fill up once a week, times four – you get (roughly) $240 annually.
This is a conservative estimate. If you fill up more than once a week (many do) or your vehicle has a larger tank (as many do) you will be paying more. Possibly a lot more.
And this assumes no further upticks in the cost of gas – that the current $3-ish plateau is going to hold. But there is no sign of that happening. In fact, gas prices continue to creep inexorably upward – probably as a result of the Fed flooding the economy with its neo-Confederate Dollahs, which become less and less valuable the more of them they print.
30 cents over three months isn’t all that bad, some may say. Yes, but what about the cumulative impact of such a gradual upticking?At the current rate of increase, a gallon of regular will cost $5 per gallon by this time next year. If you have a small car with a 15 gallon tank it will cost you $75 to fill it up. $300 a month. $3,600 per year.
It could get worse. Some economists not unreasonably expect significant inflation – not the 30 cents over three months type (about 10 percent) but the 30 percent over three months type. That’ll get us to $4 per gallon by summer – and $5 (maybe $6) by fall 2011. Many of us could be looking at spending $4,000 every year just to feed our wheels.
Which makes me even gladder I spent $1,500 back in November on a new (to me) motorcycle, a used but in great condition 1983 Honda GL650 Silverwing Interstate. For the cost of the optional GPS package on something like a new Prius, I got a machine that gets better mileage (50 MPGs, average – not just “city” or “highway”) than the Prius. It also costs next to nothing to insure ($75 annually for me) and the local Chekist thugs can only extract chump change from me in the form of “personal property taxes” because the bike’s retail value is so low.
For now, anyhow.
I suspect others are going to catch on soon and do the equivalent of storing up some food for just in case – and buy a high-mileage motorcycle for just around the corner. When that happens, the cost of currently cheap older motorcycles is going to skyrocket as the supply of good ones is limited and they won’t be making any more of them. New bikes are good, too – but thanks to Uncle they’ve become much more like cars in recent years, with the same elaborate, expensive, can’t-fix-it-yourself equipment (digital fuel injection; computers, catastrophic converters) that have made cars ever-less-affordable to buy and much more expensive to keep up. Plus, with the new stuff you will get hammered twice – by your insurance cartel and by the local Chekists, who will base their extractions on the retail value/purchase price of a new bike. And a decent new bike will cost you $7,000 or so; around $15,000 for a long-haul touring bike with storage and protection from the elements (windscreen and fairing, etc) like my Silverwing has.
The older stuff – especially bikes from the Golden Era, also known as the era of the Universal Japanese Motorcycle (UJM) circa 1974-1985, when Honda and Kawasaki and Suzuki were wresting market share from the then-established players like Triumph and Hardley Ableson by building over-engineered, almost indestructible stuff that would literally last decades without asking for more than the occasional oil change – that’s where the action’s going to be. I’ve been keeping my finger on the proverbial pulse – lurking eBay Motors and other classified ad venues – and just like the market for older cars and trucks, post-Clunker, the prices of these older UJMs is going up, up up.
Just this week I found ads for three Silverwings similar to mine but with higher miles – and higher price tags. I doubt I could fine a similar machine for less than $2,000 – a $500 increase over three months.
People are catching on – and doing the smart thing. Maybe the only thing that makes any sense.
Buying a new Prius or Volt or whatever is not going to save you from economic deracination. Instead of paying Exxon-Mobil, you’ll be paying Toyota or GM.
The only way out is to figure out a way to drive a lot less – or start riding a lot more.
I know which path I’ll be taking. How about you?