“Forever is composed of nows”

Emily Dickinson

Honda thinks my new Civic will be worth $12,000 three years from now. I don’t think so. Here’s why.

Gas is inevitably going up up up because of emerging, energy-hungry markets in Asia and the rest of the world.

Higher Demand+ Limited Supply= Higher Prices.

A car that gets ‘only’ 25/36 MPG won’t be in demand.

New car technology, including plug-in hybrids, will be the standard because the demand will be intense and the technology exists now.

As the Car Lady pointed out in a recent comment, leasing is definitely the way to go right now because of these factors. Things are changing so fast that you can’t risk owning an expensive piece of equipment that will become outdated before it is even paid for.

Welcome to the future.

I live in a neighborhood of large, turn of the century (1900 not 2000) homes, most converted into apartments. From my kitchen window I can see down the backyards of my neighbors and each has its own large garage at the rear of their yards. There is a two story brick garage with a green tile roof, a stucco garage with diamond-paned leaded glass windows and a 1.5 story, three car garage with a loft. Not carriage houses exactly but very nice small buildings. In practically any other country these would be desireable buildings to live in. Here they are occupied by cars.

Yesterday I leased a new car in spite of my earlier stated plan to avoid doing so. I’m on a tighter budget these days and the nature of my last lease deal made it a financial no-brainer to just get another car and continue my plan. I drove an Accord (bigger, more boring and less mileage than my 2005 Accord), a Fit (cool little van-like Euro-Honda, 25/35 MPG) and a Civic which I liked best and which, surprisingly, got the best mileage (25/36).

The nature of leasing is that the estimated value of the car at the end of the lease or the ‘residual’ value determines how good a deal you get. The Civic had the best residual, cost about the same, after haggling, as the Fit and was the nicest to drive between the two more efficient cars. The Fit was underpowered but had tons of space. I liked the Civic’s car-ness better.

I’ve never been less excited about buying a new car. Nothing against the cars but it was a choice made for purely financial reasons. I would have just as soon kept driving the Accord but it would have cost me too much in the short term to do so. These are the choices I have to make these days.

So I’m driving the new car home from the dealer which is out there in one of those automall strips you find all over the country. About 1pm on a Monday. Traffic is bumper to bumper and I can’t see a single vehicle with more than one occupant. Our dependence on oil couldn’t be more pronounced. One person per car and each car gets its own nice house. That’s America for you.

And I was alone in my car too. No nice house, just a parking space…

I have a three year-old Honda Accord that is about to come off of a lease. I have three options: Turn the car in, lease another on very favorable terms or buy the car, again on favorable terms (it’s very low mileage). All three probably cost me a similar amount. I either continue making a payment for a new car or for the existing one. Most leasees would go for the new car.

In the Marcc 2008 issue of Metropolis magazine (sorry no link that I can find) Roberta Gratz has an essay on the environmental impact of historical renovation as opposed to tearing down and building a new ‘greener’ building. She notes that:

” The greenest building is one that’s already built”

The struck me as being very relevant to two themes of this blog and my life these days: The hidden carbon cost of apparently environmentally-friendly products like organic produce (shipped how far to reach a wintry city like Rochester?) and the fact that when I buy something used I’m keeping its materials out of landfills and eliminating the need to make something new.

So I decide to buy the car I have already rather than buy a new one and thus add a carbon-intensive new motorized object to our collective environment. And while I have a dream to build a contemporary urban living space, I think I have to find a building and reuse it rather than build new. The ‘cost’ of tearing down and recycling or landfilling the building would far outweigh the advantages of ‘green’ new construction.

We cannot think about environmental issues the way we did in the past. Food that is grown without pesticides and fertilizers is great until you ship it a thousand miles to the consumer. That shipment just wiped out any advantages from an environmental perspective (the health advantages are also offset by the emissions associated with the travel). There is no free lunch for those who believe that they do right by buying this stuff.

Economically, with a recession upon us, the current administration’s solution is to hand out money and tell people to go forth and consume. This will allegedly stimulate the economy by increasing demand which in turn increases manufacturing. There’s only one problem with this: We live in a world that has fundamentally changed. If we all keep consuming at some point we turn all the raw materials of the planet into manmade objects. Not a pretty picture.

I saw a headline today that there are worldwide grain and food shortages because of American farmers growing corn for ethanol, a fuel most of us cannot use or afford if not subsidized by the government. The complexity of the idiocy behind this is mind-boggling.

The point here is that you cannot take a short term, simplistic approach to any purchasing decision these days. Do I buy a Prius to get an extra 20 MPG when that decision pushes a car somewhere into a landfill and adds another, albeit efficient, car into our global inventory? That’s the kind of question we have to ask ourselves in an environmentally damaged world.

Apparently it’s not rocket science to do this but it would require a lot of power so they are proposing creating a nuclear-powered gasoline generation plant that would convert carbon dioxide into gas.

Just one more technology solution to throw into the mix. This one becomes viable when gas at the pump hits $4.60/gallon. The national average cost a year ago was $2.26, today its around $3.20 but oil closed above $100/barrel yesterday for the first time so that $4+ number could happen this year.

The economics of alternative energy sources get a lot more compelling as prices rise, just as do those of public transportation.