Yesterday’s Wall Street Journal published a special section entitled “One Billion Cars” that explored the ramifications of an increasingly auto-centric world. According to a graph in the report, the global fleet of cars and light trucks in 2005 was roughly 750 million. The number should shoot well past 1.0 billion by 2020, and 1.2 billion by 2030. Global gasoline consumption is expected to surge from roughly 275 billion gallons of “gasoline equivalent” in 2005 to 400 billion by 2030.
Now, I’m not one of those alarmists who thinks that we’re running out of oil. As gas prices rise, free markets will introduce new technologies — witness the new petroleum-cracking catalysts unveiled recently by Richmond-based Albemarle Corporation, which can refine lower-quality oil reserves more efficiently — and new substitutes like bio-fuels. Whether those technologies/substitutes can come online fast enough to compensate for increasing demand from China, India and other developing nations, however, is questionable. Combine rising global demand with unstable oil supplies, and the price of oil is likely to continue increasing. U.S. crude oil futures set a new record yesterday, hitting nearly $71 per barrel.
As noted in a previous post, “Virginia’s Vulnerability to Oil Shocks,” Virginians consumed 527 gallons of gasoline per capita in 2004. Of course, that understates the impact on motorists, because not everyone drives. Virginians consumed 979 gallons per motorist in 2004, according to the Division of Motor Vehicles. Each $1 increase in the price of gasoline taxes relieves the typical driver of nearly $1,000 in after-tax, take-home pay. A household with two drivers sees a reduction of nearly $2,000 per year!
I cannot stress this enough: Our scattered, disconnected, low-density pattern of development is a significant contributor to the increase in Vehicle Miles Driven and gasoline consumption. Over the past half-century, Virginians have built an autocentric physical infrastructure adapted to a cheap-energy world but maladapted to an expensive-energy world. All the signs are there for anyone who’s paying attention. But our political leaders continue their Business As Usual transportation and land use policies, differing only in the extent to which they are willing to dedicate new revenue streams to perpetuate the ancien energy regime.
The issue in the 2006 transportation debate is not just $1 billion a year in taxes: It’s the nearly $15 billion a year Virginians spend on gasoline, the $20 billion a year a few years from now and the $25 billion a year a few years after that. In a classic case of the blind leading the blind — blind politicians leading blind citizens and egged on by blind editorial pundits — our elected leaders are redoubling their commitment to energy-intensive transportation and land use policies that will diminish Virginians’ economic competitiveness and standard of living for decades to come.
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