This was written in 2005, before the 2008 economic meltdown. Not all of the predictions have come true, but too many have. We as a nation have done very little to avoid the dismal scenario described here.
The year is 2015, and we are driving from our home in Los Angeles to San Francisco. The car we are driving is an advanced hybrid, designed to maximize efficiency without sacrificing the luxury and creature comforts to which we have become accustomed. It is powered by a small 60 horsepower diesel engine which drives a generator. The generator charges a battery pack, which in turn drives motor-generator-brake units at each wheel. The route takes us over the Grapevine, a pretty high mountain pass. Can we do that in this car? You bet! It does require a little more driver attention than a 300 hp SUV, and we will be a tad slower on the upgrades, but just think how good it will feel to drive the 450 miles to San Francisco on 5 gallons of diesel!
Driving north out of LA, there are a few small grades that do not require any extra attention, but once we start up the Grapevine, the engine is no longer able to supply sufficient charge to meet the increased load, so the battery gradually discharges. To keep the discharge rate down, we allow the speed to drop to 60 mph, and stay in the right lane. Monster SUV’s blast past us, engines roaring, but we know that they will soon have to stop to fill their huge fuel tanks. With current prices running around $10 per gallon, we are planning to engage in our usual entertainment game when we make our first rest stop. While topping up our 5 gallon tank with a gallon or two, we will watch the faces of the SUV drivers as the pump counters spin relentlessly up to two hundred, some even reaching three hundred dollars for a fill-up on one of the “biggies” with dual fuel tanks. We have devised a game; we keep a tally of the looks on the faces of the gas-guzzler owners as their tanks fill. There are three categories:
- Horror – This look says, “Omigod, how am I ever going to pay this credit card bill!”
- Remorse – This is delayed buyer’s regret. It says, “What in the world was I thinking when I bought this thing?”
- Outrage – This is almost always seen on the face of an individual who can probably afford the astronomical price, but he’s enraged at the oil companies for “ripping him off.” He considers himself a Conservative, but he is anything but conservative in his lifestyle, consuming, polluting and exploiting his way through life. Conspicuous consumption is the way he demonstrates his importance and success to the world. But he wants cheap gas prices…there’s no status to be gained when paying at the pump.
The price of petroleum-based products has skyrocketed in the past ten years. Back in 2005, we were only paying $2.50 to $3.00 per gallon, but the steadily growing worldwide demand for oil, coupled with the continued decline in the dollar has given American motorists a double whammy. Even so, gas prices here are no higher, and in many cases lower than they are in Europe, Asia and elsewhere in the world. Those nations, though, are not as affected by the run-up in prices. Their economies are not nearly as dependent on cheap energy…it has been expensive there for a long time…so they are much more efficient in their use of oil. Most Europeans drive small, highly efficient hybrid vehicles, much like the one I am driving. There is also a major effort in Europe to “break the oil habit.” Solar, geothermal, wind, tidal and even nuclear power generation are producing most of the electricity for Europe, greatly reducing their dependence on oil. A new breed of very small battery-powered urban vehicles is gaining favor with commuters. Many homes have solar panels on their roofs. Mass transit systems provide an energy-efficient alternative to automobiles for many commuters in urban areas, and these are usually provided at no cost to encourage use.
The Japanese, with no domestic oil production, are even farther down the oil-independence road. Almost every house has at least one solar panel on the roof. Most of the advanced hybrid vehicles, like mine, are designed and built in Japan. Battery-powered cars are popular with commuters there too. Other Asian countries are following Japan’s lead…and buying many of their energy-efficient products from Japanese companies. This has led to a resurgence in the Japanese economy, which is finally out of its decade-long recession. The Japanese are world leaders in the production of high-efficiency solar panels. Our house in California has Japanese panels on the roof. The electricity they provide is sufficient to pay our electric bill almost every month, accumulating a small surplus during the sunny summer months to help cover the higher winter bills.
While most of the world is adjusting to the declining supply and skyrocketing price of petroleum-based products, the US is still addicted to oil, and it has had devastating effects on the economy…and on the living standards of the American people. Increased energy prices ricochet throughout the economy, raising the prices of virtually everything. Most products must be shipped by truck because the much-more-efficient rail system has been allowed to atrophy. Agriculture is heavily energy-intensive, so food prices are skyrocketing. Most large power plants run on oil or coal. Natural gas is preferable, but the growing shortage of that energy source has made it more expensive than oil. Heating, air conditioning, lighting…everything takes energy, and most of that energy derives from oil. Inflation is now running around 10% per year in the US. This has driven interest rates up, decapitating the housing industry and real estate prices. Of course, consumer credit is also affected, so consumer spending is down.
The resultant economic slowdown has raised unemployment rates, and many of those fortunate enough to keep their jobs have been forced to accept pay cuts. With prices on everything going up and paychecks going the other way, many people are in serious financial trouble. Home mortgage defaults and personal bankruptcies are on the rise. Property values are slumping, and many people are “upside down”…they owe more on their home mortgage than the property is worth on the market. One of the most tragic and ironic consequences is that many owners of huge SUV’s would like to dump them and buy more fuel-efficient vehicles, but they cannot afford to do so. They are trapped on an economic treadmill, spending large portions of their income for fuel in order to commute to their jobs. Their vehicles have near-zero trade-in value. Many one or two year old SUV’s, vans and full-size pickups are going to the crusher when they are repossessed from owners who have stopped making payments. Nobody wants them. Often, the former owners of those vehicles are unemployed and so financially strapped that they cannot replace them. If they live in an area where public transportation is not available, their job-hunting prospects are greatly reduced without a vehicle. The next stop for many of them is bankruptcy court, unemployment checks for awhile…then welfare.
With all this bad news, there are a few encouraging signs. Oil consumption is finally declining! The air over some cities is noticeably clearer. The wars in Iraq and Afghanistan are finally over, and our military spending has declined drastically. Even though the crippled economy has reduced tax revenues, the new government has wisely made energy efficiency a national priority at last! Solar panels and high efficiency products from light bulbs to refrigerators to hybrid and battery-powered cars are subsidized. Energy usage is still higher than almost everywhere else in the world, but it is falling steadily.
Americans are finally getting the idea that higher consumption does not lead to a better lifestyle. Riding bicycles in the park can be just as much fun for the family as driving two hundred miles to the Colorado River, towing a 500 horsepower speedboat behind a three-ton SUV, to do a little water-skiing…with earplugs to muffle the roar from the engine.
There is still a lot of work to do…to undo the damage done by previous government policies that encouraged consumption…like the Oil Depletion Allowance, and relaxation of Corporate Average Fuel Economy (CAFÉ) standards, encouraging manufacturers to build horrendously inefficient vehicles in huge numbers. These policies deferred much of the real long-term cost of that consumption for future generations to bear. It’s going to be tough for a lot of people of this generation…the current working generation. The coming years will be a painful period of adjustment to the new realities in the world. The US is no longer a rich nation. Our wealth is gone…squandered in an orgasm of government-encouraged consumption and foreign wars. Foreign investors now own many of our businesses, much of our commercial real estate, and stacks of our government bonds. A large portion of our federal budget goes for interest payments on those bonds, leaving the government short of funds for urgently-needed domestic programs, like energy-efficient public transportation systems. It is ironic that the burden of foreign-held debt, long a problem for poor, developing nations, is now afflicting the (formerly) richest nation on earth.
The world has never seen such excess…such wealth…such extravagance…such mindless consumption with little regard for the degradation of our planet and the depletion of its precious nonrenewable resources. Hopefully, it will never be seen again. The people of earth, especially future generations, cannot afford it.