How We Buy Gas Makes Us Notice Its Price
I’m as big a fan of breathless gas prices coverage as the next guy, but honestly, they aren’t actually that big of a deal in the scheme of household income. Remember this chart from the New York Times earlier this year? Gas prices are just one smallish factor, even though they provide one of the basics in life.
So, households spent $1500 more on gas this year than last? Big deal?! Honestly, the working poor can complain, but anyone with a new phone or a data plan shouldn’t really be whining.
How many flat-screen TVs, boats, ATVs, iPhones, PS3s, patio tables, etc, did people purchase last year? There’s still an enormous amount of disposable income in this country. I mean, when $1000 TV sales are driven by a single event — the Super Bowl — we clearly aren’t hurting that badly at the macro level.
But, the way we buy gas, as a commodity, like pork belly traders, is why we notice the price. It’s a rare unobscured interaction with a real market. We know it doesn’t change yet what we pay for it does.
Unlike say, iPhones, which at least look different, even if they fundamentally do the same things as phones previous.
And we can watch the price of gas fluctuate day-by-day, down to the penny. We don’t really buy anything else like this, not even food. This really hit home for me when buying diesel with a credit card the other day. The salesguy tells me he’s gonna have to charge me a premium - 10 cents a gallon! - to use a card, but I’d lost my debit card, so I had no choice. I walked out to the pump grumbling and thinking what a rip off that was.
Then I did the math. 13 * 0.10 = $1.30. $1.30! You’ll spend more than that on Dunkin Donuts coffee, let alone Starbucks. And you’ll get around on that gas for a week.
Does anyone notice $1.30 per week price bumps in anything else so central and vital to our lives?
