In places where lots of people were already struggling, the big spike in fuel costs is much more than an economic nuisance. It's painful and scary.
Related topics: family, gas prices, middle class, economy, spending
The average price of gasoline has risen to $3.815 a gallon, according to the American Automobile Association. Four-dollar gas, as a national average, may only be a month away if crude oil stays above $105 and the Libyan conflict continues.
The international oil crisis also could worsen if political unrest boils over in Nigeria -- the biggest petroleum producer in sub-Saharan Africa. Rebel attacks have shuttered oil operations there in the past.
Gas prices vary sharply from state to state. Regular unleaded fuel costs $4.17 per gallon in Alabama, while the price is below $3.50 in some other states. Part of the reason for these discrepancies is differing gas taxes, and another part has to do with the cost of transporting fuel.
Fuel costs cannot be considered in a vacuum when it comes to their effect on consumers. A household with an annual income of $250,000 may not be bothered much by $5 gas. But a household with an annual income of $35,000 could find $3.50 gas so expensive that cutbacks in other routine spending are necessary to offset the cost of driving.
24/7 Wall St. looked at factors that make gas more or less affordable by state. It examined the average price of gas, of course, but also considered conditions that influence how much the price of gas affects consumers. These included a state's median household income, unemployment levels and the proportion of people there who live below the poverty line. A state that combines high gas prices, high unemployment and low median income is likely to be one where levels of consumer spending are threatened.
This analysis shows the extent to which the U.S. economy cannot be viewed simply as a whole -- as an undifferentiated collection of 50 states. Whatever happens with the national economy, some states on this list, like Alabama or West Virginia, could be tipped back into local recessions by a combination of high gas prices and low wages.
Each of the states whose people can least afford gas has a different set of factors contributing to the effects of high fuel costs. However, much of what applies to one state could also apply to another: Gas prices will cause people to postpone vacations and defer daily expenses. Construction companies will suspend some of their activities. Businesses that deliver goods to homes or other businesses will try to raise their prices to offset their costs of transportation.
Some of the states on this list barely made it out of the last recession, if they did so at all. Some still have double-digit unemployment and high poverty levels. The sharp rise in gas prices becomes more severe for them each day.
10. Iowa
- Median income: $50,721 (21st-highest)
- Price of regular gasoline: $3.94 (8th-highest)
- Unemployment: 6.1% (6th-lowest)
- Below poverty line: 13.07% (16th-lowest)
High gas prices are causing pain across Iowa, which has the eighth-highest gas prices in the country. One sector having trouble dealing with these rising prices is public education. Gov. Terry Branstad announced projections of 0% spending growth for all Iowa schools for the next two years. School districts, however, cannot avoid spending more money for fuel. "We're at the mercy of the market whenever we purchase (fuel)," said Bill Good, the chief operations officer of the Des Moines School District, according to Des Moines broadcaster KCCI. That increase at the pump means schools will have to make cuts in other parts of their budgets.
9. Ohio
- Median income: $45,879 (19th-lowest)
- Price of regular gasoline: $3.83 (17th-lowest)
- Unemployment: 9.2% (20th-highest)
- Below poverty line: 19% (16th-highest)
Gas prices in Ohio are affecting not only individual drivers but also industries that rely heavily on transportation and related services. One local news station noted that farmers, too, are taking a hit. Farmers need fuel to operate their equipment, and the costs of some essential agricultural supplies, such as fertilizer, are affected by oil and gas prices.
8. North Dakota
- Median income: $50,075 (23rd-highest)
- Price of regular gasoline: $3.97 (7th-highest)
- Unemployment: 3.7% (lowest)
- Below poverty line: 12.77% (15th-lowest)
North Dakota has the seventh-highest average gas prices in the country, at $3.97 a gallon -- up 12.8 cents from March. Bismarck television station KFYR quoted the state tourism director, Sara Otte Coleman, as saying that "an increase in gas prices is [going to] hurt people's discretionary income in general." The North Dakota tourism industry, which seeks to sell travelers on the state's wide-open spaces and natural beauty, may suffer as a result.
7. Florida
- Median income: $45,631 (15th-lowest)
- Price of regular gasoline: $3.82 (18th-lowest)
- Unemployment: 11.5% (2nd-highest)
- Below poverty line: 18.17% (18th-highest)
The state has the third-highest unemployment rate in the country -- 11.5% -- and that, in combination with high gas prices and a relatively low median income, is a recipe for pain among automobile users. The state's average gas price is $3.82, the 18th-highest in the country, and its median income is $45,631, the 15th-lowest. As in other states, those who are looking for work or who have low incomes are being hurt the most by high gas prices. Some Floridians have turned to hybrid cars as a solution. A southwest Florida news station noted that hybrid cars have begun selling so quickly that there have been unexpected shortages in the state.
6. Kentucky
- Median income: $42,664 (8th-lowest)
- Price of regular gasoline: $3.80 (21st-lowest)
- Unemployment: 10.4% (6th-highest)
- Below poverty line: 22.67% (3rd-highest)
Kentucky is home to the ninth-lowest median income in the country, the sixth-highest unemployment rate and the third-highest percentage of the populace living below the poverty line. The national average for the increase in gas prices from last year is 28%. Gas prices in Kentucky during that span have increased 34%. Gas prices have also caused food prices to increase by 5.2% in the past three months, the highest quarterly increase in the past three years, according to the Kentucky Farm Bureau.
5. Michigan
- Median income: $45,994 (20th-lowest)
- Price of regular gasoline: $3.94 (9th-highest)
- Unemployment: 10.4% (6th-highest)
- Below poverty line: 19.07% (15th-highest)
Gas prices in Michigan are the ninth-highest in the country, which may worsen the state's unemployment rate -- already the country's sixth-highest. One industry being affected is construction, which is struggling because of the rising cost of materials. Mike Ferraro, the president of Ferraro Builders Inc., was recently quoted by a northern Michigan TV station as saying, "We have to pass that along to some extent, and the difficulty is determining how much of this increase (in) expenses we can pass to the consumer versus how much we're able to essentially absorb."
4. North Carolina
- Median income: $41,906 (8th-lowest)
- Price of regular gasoline: $3.89 (11th-highest)
- Unemployment: 9.7% (12th-highest)
- Below poverty line: 20% (13th-highest)
North Carolina has the 11th-highest average gas price in the country. It also has the eighth-lowest median income. Those who make less money are being affected by gas prices in a number of ways. One local news organization reported on a man who has started working 12-hour days to pay for the gas he needs to commute to his job.
3. West Virginia
- Median income: $40,490 (5th-lowest)
- Price of regular gasoline: $3.88 (12th-highest)
- Unemployment: 9.4% (16th-highest)
- Below poverty line: 22.07% (5th-highest)
West Virginia has the fifth-lowest median income in the country, as well as the fifth-greatest percentage of its population below the poverty line. Wayne Waldeck, the chief executive officer of pizzeria operator Wal-bon Corp., said the company spends "thousands of dollars a week on gasoline for delivery trucks," according to the Parkersburg News and Sentinel. The bite, he added, is getting harder. Across the state, companies hit by rising fuel costs are increasing what they charge to deliver goods -- passing along the higher costs to consumers.
2. Indiana
- Median income: $44,305 (12th-lowest)
- Price of regular gasoline: $4.04 (4th-highest)
- Unemployment: 8.8% (24th-highest)
- Below poverty line: 17.57% (20th-highest)
With gas prices topping an average of $4 per gallon for the first time since 2008, Indiana currently has the fourth-highest gas prices in the country. One way some people reacted was to stage a one-day boycott. Greg Seiter of AAA Hoosier Motor Club told a local newspaper, "If past experiences are any indication, the $4 mark tends to move people in ways that other price levels don't. . . . (Y)ou're going to notice people cutting back on driving, sharing rides, shopping aggressively for gas prices and doing everything they can to save themselves a little money."
- Median income: $39,980 (3rd-lowest)
- Price of regular gasoline: $4.17 (3rd-highest)
- Unemployment: 9.3% (18th-highest)
- Below poverty line: 21.77% (6th-highest)
Alabama has the third-highest gas prices in the country and the third-lowest median income. Just under 22% of the state's population lives below the poverty line -- the sixth-greatest proportion among all states. Residents of the state's Gulf Coast feel these prices pinching their wallets just a year after the big BP oil spill disrupted their lives. Tourist spots that were effectively shuttered last year by that environmental disaster will now have to handle a drop in tourist traffic due to high gasoline prices.
Comment:
Comrades, I've just about had enough of their greed. Don't you think it's an odd coincidence that all these "wars" are popping up in oil producing countries? It's no coincidence. These so-called wars are being used as an excuse to jack up oil prices. Either that, or they're being caused deliberately knowing full well that oil prices will skyrocket. It's most likely a little of both.
What's happening in Iraq, Afghanistan, Libya, and the next will be Nigeria, are textbook examples of Imperialist Judeo-Capitalism. Brothers and sisters, it's time we stood up to these blood sucking pigs. For starters, get rid of those damn gas hogs of yours. Why do you have an SUV if you never go off roading? OK, you may have six kids. Fine. But you don't need all wheel drive. Two wheel drives use less gas. And you truck owners - some of you have huge trucks that have never seen a day's work. You've had them a couple of years and they're still shiny bright. You don't use them for work. You just want them because they make you feel like big men. GET RID OF THEM. A man is judged by his actions, not by the size of his truck. If you need a truck for your work, then that's different. However, do you really need eight cylinders, or will six suffice? Six uses less gas.
The price of oil will continue to rise as long as the oil companies know we'll continue to pay their blackmail. You can write letters until your hands fall off. You can make phone calls until your dialing fingers break. A fat lot of good it will do. They could care less. They know how to handle whiny people.
Letters and phone calls to your elected officials are just as worthless 99% of the time. Most have been completely corrupted, and there are too few who haven't (yet) for them to be able to accomplish anything.
Here's another thing. Stop traveling for fun, but only for business. I know not being able to go anywhere sucks, but if we want change, we have to sacrifice. If no one is willing to sacrifice, then there will be no change. Here's a thought. If you want to go someplace for vacation this summer, then come to Laurens for our national conference. The entire thing is open to all Official ANP Supporters, and part of it will be open to non-Supporters. This way, you can go someplace, and yet still call it business. On the way home you can stop at tourist attractions along the way. Last year on the way home, I stopped at the Petrified Forest and the Giant Meteor Crater. If I had kids, they would have gone nuts over those places. In all, I went a grand total of 30 miles out of my way. Less than two extra gallons of gas. That's pretty good. Think about it.
I've said this one before. We can hit them at the convenience stores. When you buy gas, skip the snacks and drinks. Go to a grocery, liquor, or package store for that. Quit your whining about how it's too much of a pain-in-the-ass to make two stops and just DO it. Money is the only language the oil companies speak, so that's where we have to hit them, even if it requires something most people don't want to give - a little effort. Pardon my use of obscenities. I used the "E" word. Sorry about that. If you're on a long road trip like to Laurens, that's different. Saving time is very important. I'm only talking about skipping the convenience store in your day-to-day activities.
For those of you who think this commentary has turned into a bit of a rant, you're right. Today I set a new record for me. I bought gas. It cost me $150 to fill both my gas tanks in my truck. Remember, I'm self-employed and do need a truck for my work. It's true that that is my gas for the entire month of May, but still - $150! Regular gas is up as high as $4.35 in So. Cal. Last year at this time, it cost less than $90 for the same amount, and it's only going to get worse. That's why we must all make our voices heard.
This is not just a National Socialist issue. This effects EVERYONE. Now my suggestions for fighting this may do very little good. But it's better than just bending over any taking it.
BTW, notice how California isn't on that list? That's because we're the highest in the lower 48. They don't want the rest of the country to know that our Premium gas is already nearing the $5.00 mark. Believe me comrades, the lid is on the pot. It won't take much more before it blows.
Dan 88!
