My friend Franke does it again, riffing on her experience seeing Malcolm Gladwell and Mark Kingwell (don’t know who he is) talking about initiating social change. Her illustrations tell the story much better than I can so I’m just going to add a little of my perspective to her observations.

Franke is Canadian so maybe things are different across the lake but I doubt it.  Simply put, Gladwell argues that awareness is not enough to change behavior and Franke notes that sometimes a threat or pain point must be reached.

I’ve been noticing a lot more Euro-versions of cars appearing on the streets in Rochester- little tiny Hondas, Toyotas, Fords, etc. These cars are literally a fraction of the size of the SUVs they are hopefully replacing. So why are they appearing now? Could it be $4.25/gallon gas? Even a wealthy SUV driver might have issues with paying five bucks for gas to run out to the store or a movie…

A point I’ve belabored here is that change and response to  climate issues will only be driven by economics. Americans don’t want to believe it will affect us so our politicians won’t act. Awareness and acceptance of the issue is there but there isn’t any urgency- until we get hit in our wallets, painfully.

The idea that we should cut federal taxes on gas for the summer is an appallingly cynical, politically motivated panacea only two candidates for President could cook up. Do they really think Americans won’t recognize this for what it is: A cheesy handout to warm up voters?

Read Tom Friedman on this:

“The McCain-Clinton gas holiday proposal is a perfect example of what energy expert Peter Schwartz of Global Business Network describes as the true American energy policy today: “Maximize demand, minimize supply and buy the rest from the people who hate us the most.”

Few Americans know it, but for almost a year now, Congress has been bickering over whether and how to renew the investment tax credit to stimulate investment in solar energy and the production tax credit to encourage investment in wind energy. The bickering has been so poisonous that when Congress passed the 2007 energy bill last December, it failed to extend any stimulus for wind and solar energy production. Oil and gas kept all their credits, but those for wind and solar have been left to expire this December. I am not making this up. At a time when we should be throwing everything into clean power innovation, we are squabbling over pennies.”

With oil hitting the $120/barrel mark today and local gas prices here in Rochester hovering around the $4 level, Dan Dorfman of the NY Post is predicting prices reaching $7-10 gallon by next year based on a move of oil prices over the $200 level.

A number of things reinforce this beyond those things he covers in his op-ed piece. First, much of the world’s oil production takes place in extremely unstable geopolitical regions. Exxon Mobil has shut down its 800,000 barrel a day Nigerian sources due to strikes. A UK union strike has shut down a BP oil pipeline that supplies one quarter of that country’s oil. Oil production in Iraq is corrupt and undependable due to the war, Iraqi incompetence and the US failure to modernize and repair war damaged facilities. Venezuala’s Chavez sees oil as a weapon to advance his nutty authoritarian agenda. And on and on.

Demand worldwide has skyrocketed and this will only increase. It appears that we have reached the tipping point on oil energy costs. A doubling of fuel prices means a doubling of the cost of virtually everything else except wages. And there is no going back.

“Skybus Airlines announced it was shutting down Saturday, with the low-cost airline blaming the “insurmountable” pressures of rising jet fuel costs and a slowing economic environment.
Columbus, Ohio-based Skybus became the fourth airline this week to close or announce plans to do so.”

From MarketWatch (emphasis mine)

The others are Aloha, ATA and Champion Air. Fuel surcharges for flights are skyrocketing and the airlines have separated them from their advertised prices. For example I recently saw a one way price of $220 for a NY to London flight. Sounds pretty good right? Except that it did not include a $160 fuel surcharge each way.

The impact of rising energy costs is everywhere. Food, commodities, travel, transportation- you name it. Yet we are, as a nation, doing virtually nothing about it (except for begging OPEC to give us a deal). History is going to look back and wonder how we could ignore the breadth of change that is upon us.