How Do Soaring Gas Prices Affect You?
NEAL CONAN, host:
This is Talk of the Nation. I'm Neal Conan in Washington. The end of last week saw a dramatic surge in oil prices and a reciprocal plunge on the stock market. Both settled back a bit today. Still, the average price of a gallon of gas is over four dollars nationwide, in some places, four bucks a gallon seems a distant memory, and of course, the cost of fuel ripples throughout the economy.
So whether you own a small business or commute to work from an outer suburb, whether you switched shipments from truck to rail or manufacture wind turbines, how does the rise in the price of fuel change the economic math of your work and your life? Our phone number is 800-989-8255. Email us, email@example.com. You can also tell us your story on our blog that's at npr.org/blogofthenation. And let's begin with Michael, and Michael's with us from Flagstaff, Arizona.
MICHAEL (Caller): Hey, Neal. It's good to be on this show.
CONAN: Thanks for calling, Michael. What's up with you?
MICHAEL: Well, I'm a food server here in Flagstaff, Arizona. Flagstaff is a - its number one industry is tourism. It used to be logging, but now it's tourism. Phoenix is about two hours away, and we're really not seeing a whole lot of people this time of year. It's probably based on the economy because they have to drive up here. There really isn't much of an airport, and the gas prices are really high, and especially if Flagstaff is the top of Arizona in terms of gas prices as well. So, it's probably, you know, a big factor. Our peak season is this time of the year, and it's really not happening at all. So...
CONAN: I've been to the airport in Flagstaff, and I agree with you, it's not much.
MICHAEL: Yeah, there's many a comedian that will make many jokes about the Flagstaff airport here, yeah. But if you talked to people all around the city, and they will tell you the same, restaurant workers, managers, and owners, they'll tell you the same, that business is just not the same, and when the winter months come, it really dies down here. This is really our main source of income during this time of the year, and so it's going to be very difficult for a lot of restaurants to stay open after this.
CONAN: And what kind of restaurant do you work in?
MICHAEL: I work in an American style bistro. Its name is - well, I might as well plug it. Its name is Josephine's, and it's a really nice restaurant. It's a little bit on the fine-casual side, and it's just that the numbers are much lower than they should be.
CONAN: Thanks very much, Michael. Good luck to you.
MICHAEL: Thank you. Have a good day.
CONAN: Joining us now is Vijay Vaitheeswaran. He's the correspondent for the Economist and joins us from the studios today at the Council on Foreign Relations in New York City. And Vijay, nice to talk to you again.
Mr. VIJAY V. VAITHEESWARAN (Healthcare and Energy Correspondent, The Economist): It's great to be with you.
CONAN: And Michael's situation, a lot of people around the country are feeling this effect as, well, fewer people drive. Fewer people are going to drive two hours to go to a restaurant in Flagstaff, Arizona.
Mr. VAITHEESWARAN: Yes, absolutely, and I think that we really see the impact of four dollar-gas across America. This is the demand impact of prolonged period of high prices. Let's remember, the global price of oil was 10 dollars a barrel back in 1998. Today we're talking figures above 130 dollars a barrel. So, over the course of the last decade, but especially in the last couple of years, we've been seeing the price going up, and it really is to a point where people feel the pinch very much.
CONAN: Today Saudi Arabia called for a meeting of oil producers and oil consumers to work to prevent what the oil ministry there described as "unwarranted and unnatural" price hikes. And he also described today's prices as unjustified. Would a skeptic be right to question his sincerity?
Mr. VAITHEESWARAN: One should always be skeptical when the de facto leaders of a price-fixing cartel profess great concern for consumers who are...
(Soundbite of laughter)
Mr. VAITHEESWARAN: Of course, the target of their price-fixing. I mean, that's what a cartel is, right? They get together in a room, and they reduce production in order to keep up prices. So, bearing that skepticism in mind, I would actually have said it's wrong to point the finger at OPEC and OPEC alone right now. There's not probably a whole lot that the Saudis or anyone else can do right now, because the dynamics of the market have taken off in such a way in recent months that it's really somewhat disconnected from the basics of supply and demand.
We're seeing a lot of financial interest in the market place, a lot of financial money, pension funds. Much has been written about commodity-index funds. And so, you're actually finding that every new report from the Wall Street banks saying 150 dollars is coming, super spike of 200 dollars. Almost acts as a self-fulfilling prophecy in the way we saw during the dot-com boom.
CONAN: And I was just to ask about that. We saw the dot-com bubble. We saw the real estate bubble. Any hope that there's an oil bubble out there?
(Soundbite of laughter)
Mr. VAITHEESWARAN: You know, it's a mugs game to predict prices. So, I'm not going to do that. But I would say this, oil is a commodity. Now, it's a very politicized commodity, but commodity markets go up and often they come crashing spectacularly down. And people who look at oil, who look at the fundamentals, I would say there's plenty of room for prices to come back down as well, because the oldest saying in the oil business, the best cure for high prices is high prices.
(Soundbite of laughter)
CONAN: Let's see if we can get another caller on the line. This is David, and David's with us from Rifle, Colorado.
DAVID (Caller): Yeah. Good morning. I'm a truck driver. So, this really affects me. We get paid by the mile, and they've cut my truck's speed down, so it takes me more hours to work. That's to decrease consumption.
DAVID: Get more for your fuel.
CONAN: So, you're on the double nickel?
DAVID: Pardon me?
CONAN: You are driving on the double nickel?
DAVID: You know what? I would drive on that if I had a tax break. If they were to - because, they pay Exxon, Mobil and Chevron money to go out and find oil everywhere. If they paid Americans to do this, just regular Americans to drive slower, we could find as much oil as they could find in the Rockies or the ANWR. Just pay us.
DAVID: Give us their break, you know, cut my taxes.
CONAN: In the meantime, are you able to pass along your higher prices for fuel to your customers?
DAVID: Oh, yes, it's guaranteed in our contract that we pass that along.
CONAN: And is business still what it was?
DAVID: No, business is down, because we supply the housing industry, and so, a lot of our customers are ordering a lot less. It's having a ripple effect, but we're locked into some contracts. We're real fortunate on this end of the business. I have friends who are into hauling produce and such, and their loads are jam-packed, because you want to put as much freight as you can on the trucks you have. So, there's none of this one or two or three small orders. And as a result, just in my grocery store where I live, they ran out of items. And if there was a Wal-Mart, and they were running out of items because they couldn't get the trucks to replenish things they were running out of fast. So...
CONAN: I also wonder, are you seeing more competition from industries, like rail, which are, you know, obviously, their prices are not rising anywhere near as fast?
DAVID: I don't - yeah, of course, there - it's called inner mobile (ph). But the companies aren't set up to run rail shipments. I mean, you're running from warehouse to warehouse and it's all set up through - via the highway system. There aren't as many railway yards and depots and warehouses set up for rail. I imagine if the prices stay this way, it will become - it'll make sense to do that. But right now, I think overall, the trucking industry, that's what's happening. But on my level as a truck driver, I'm not seeing it.
CONAN: OK, Dave.
DAVID: These doors aren't serviced by train. They're serviced by trucks.
CONAN: Thanks very much, David, and drive carefully, would you?
DAVID: Oh, sure.
CONAN: Joining us now is Dean Foust. He's the Atlanta bureau chief for BusinessWeek Magazine, and he joins us from member station WABE in Atlanta, Georgia. Dean, nice to speak with you again.
Mr. DEAN FOUST (Atlanta Bureau Chief, BusinessWeek Magazine): Oh, my pleasure.
CONAN: And we usually talk to you about the airline industry, and just today we saw, I think it was, American, announced a 20-dollar increase per round-trip ticket, a fuel surcharge, and of course, everybody follows suit.
Mr. FOUST: Indeed. The airlines are - really are hurting. I think you could see more capacity cuts, some estimates that the airlines will eventually have to cut capacity by 20 percent, and raise prices by 20 percent just to turn a very small profit. So I do think that's the future of flying.
CONAN: And the airline industry is hardly alone in feeling the ripple effect.
Mr. FOUST: Indeed. All through the economy certainly consumers are feeling it. Right now, consumers are spending about six percent of their income on gas. And that's - think back to, what, '99, 2000, when gas was 89 cents a gallon. Average American spending, about one and a half percent. So, clearly that's going to pinch consumers, and in turn, going to hurt the restaurants and all the other - particularly the discretionary income, the establishments that require - rely on discretionary income.
I was struck by - it's not the tourist destinations that are now offering gas cards, or the hotels doing the same. I'm a golfer, and one of the big club makers, Callaway Golf, is now offering a 100-dollar gas card if you buy their new driver. And even as I was driving to the show today, to the station, I'm driving and I see a sign up and it says, free gas card to customers. And I look over and it's a strip club. So, go figure.
CONAN: You've got to drive, I guess, to get there, too.
Mr. FOUST: You got to drive there to get, yep.
CONAN: The price of the dollar, Vijay Vaitheeswaran, the price of the dollar is affecting all of this, too, isn't it?
Mr. VAITHEESWARAN: Definitely. One of the factors, one of the important factors affecting the oil price has been the weak dollar of the most recent years. It's a little bit of an unintended side effect of our policies, and it has the perverse consequence that our friends and compatriots over in Europe are actually seeing a much smaller rise in the oil price than we are. Because, of course, they're thinking in euros, and the oil price hasn't gone up very much at all compared to us. Oil is priced only in dollars.
CONAN: Well, they pay about double what we do already because of higher taxes. But that's another issue.
Mr. VAITHEESWARAN: That's right.
CONAN: Let's see if we can get Shannon on the line. Shannon's with us from Kerry in North Carolina.
SHANNON (Caller): Hi.
CONAN: Hi, Shannon. Go ahead.
SHANNON: Well, I'm a small-business owner. I own a landscaping company. And what we're seeing is huge increases in anything that's trucked cross-country. So, a lot of our plants are grown out on the West Coast, and trucked clear across the country to us, some of the larger plants, Japanese Maples, things like that, but also anything that is processed using diesel. So, for example, our triple-shredded hardwood mulch is put through a diesel shredder three times, trucked to the site in a diesel truck, triple shredded in a diesel shredder, and then loaded on to our diesel truck, and brought to the clients house.
CONAN: And all of that sounds like about a triple headache.
SHANNON: Oh, yeah. The price that we now have to charge, in the past five years, it's gone up half again what it used to be.
CONAN: And how much has that started to cut into your business?
SHANNON: Well, between that and last year's drought, we've had a lot of problems to face. But we've managed to make some adjustments. I've gone out and replaced my consultation vehicle with a hybrid. So that certainly helped. But I think what we're seeing is clients are reluctant to put money into things like mulch and soil and big plants. They're looking more for smaller things that they don't have to spend as much money on, or hardscaping (ph), stone, and things like that. They're not running a risk of watching those things die. Those things will stay there permanently where buying a tree is dangerous.
CONAN: Well, at least it's started to rain.
SHANNON: At least it did start to rain. That's been wonderful.
CONAN: Shannon, good luck. Thanks very much for the call.
SHANNON: Thank you.
CONAN: So, how is the rise in the price of fuel affecting the math of your life, your business? If you commute from an outer suburb, does the increase in gasoline change how you look at that mortgage that you got for a lower price? Give us a call, 800-989-8255. Email us, firstname.lastname@example.org. I'm Neal Conan. It's the Talk of the Nation from NPR News.
(Soundbite of music)
CONAN: This is Talk of the Nation. I'm Neal Conan in Washington. The new reality of high gas prices and the effect on the economy may be causing an excess of math in your life. Whether it's calculating the price of your commute, or the price of your house in comparison, economic realities change every time those numbers change at the pump.
We're talking with Economist correspondent, Vijay Vaitheeswaran, and with Dean Foust, Atlanta bureau chief for BusinessWeek Magazine. And of course, we need you to call in. How does the rise in the price of fuel change the economic math of your life? Or if you have questions about - gulp - what happens next? 800-989-8255. Email is email@example.com. You can also read what other listeners have to say on our blog at npr.org/blogofthenation. And let's see if we can go to Matthew, Matthew with us from Oswego in New York.
MATTHEW (Caller): Hello.
CONAN: Hi, Matthew.
MATTHEW: I'm an airbrush artist, kind of a definite niche business. And I've seen it affect my business. I have to give my customers more work in order to keep them coming. But I've also seen, as I travel, the effect it has on a lot of the vendors, such as I, that count on us to be fairly standard. And it's really eaten into a lot of their budgets.
CONAN: Am I wrong in suggesting that you say a niche business, you're looking - you're getting a luxury market there?
MATTHEW: Very much a luxury market. And luckily, I'm diverse enough to move into some different things, maybe logos for businesses and stuff like that. You know, people, they have a lot of faith. But you know, I think that corporate American, in a certain sense, is going to stretch things a little too far, perhaps. And they need to be, maybe, a little more careful about what they decide what is a profit for them.
CONAN: Well, hang in there, Matthew. Vijay, are things getting so serious that even the wealthy are cutting back in their expenditures?
Mr. VAITHEESWARAN: I think that the problem with gasoline is it's regressive. It affects those who have the least in society the most. And I think that - but even having said that, you are seeing lots of well-to-do, middle-class families really feeling the squeeze. When we look at the cost that's going towards energy, as a share of our household income, we're at just close to record levels. Even adjusting for inflation, we're at just about a record level now. And that's affecting, not only, very poor Americans, but lots of middle-class people, too.
CONAN: So, Dean Foust, are we in one of those cycles where weak economy reduces the value of the dollar, which increases the price of fuel? Or contributes to the rise in the price? And it all keeps reinforcing each other?
Mr. FOUST: Yes, and no. Clearly, the weak dollar is going to make oil more expensive. But we are a nation of adaptors. I think that we will all modify our behavior. We have over the decades. If you look - if you can think of the concept of a unit of economic output, this nation now takes - uses half of the energy and the oil that it took to produce a unit of economic output than we did back in the 1970s. So, we'll move closer to our jobs. We'll buy smaller, more fuel-efficient cars. We'll do all the myriad things that it takes to adapt.
And the dollar, yes, it's going to make fuel, oil more expensive in the near term. But on the other hand, it's been of great benefit to the nation's manufacturers and exporters, who are seeing, suddenly, great demand. We've run calculations, and when you start talking about oil at 150 and 200 dollars a barrel, you're going to start to see some of the manufacturing jobs that went to China come back to the U.S., and maybe some to Mexico, but there will be a derivative benefit to the U.S. economy.
CONAN: Let's get another caller on the line, Joseph, and Joseph is with us from Lodi in California.
JOSEPH (Caller): Hi.
CONAN: Hi, Joseph.
JOSEPH: We own a small backpacking/kayaking store. As fuel prices have gone up, our sales on non-motorized equipment, bikes and boats, have gone up dramatically.
CONAN: So, you're doing well?
JOSEPH: We're doing phenomenally well to the point where we're struggling getting inventory, and it's kind of an industry issue at this point.
CONAN: So, you are, I guess, the beneficiary of that adaptation that Dean Foust was just talking about?
JOSEPH: Very much so. But, on the other hand, we have to ship those boats here. And they're 60, 70 pounds apiece, and are made of plastate (ph) so our shipping costs have tripled. And trying to pass that on to the customer has been absolutely brutal.
CONAN: I can understand that, too. But nevertheless, also do you benefit, do you think, from people staying closer to home for a vacation?
JOSEPH: That's exactly what our customers are saying. One, they're parking their big boats, the big-engine boats. Two, they're using the excuse to get in shape. And they're coming in and renting and buying kayaks. And they're traveling less than 50 miles, I would say, to spend the weekend outside the house. We used to have a lot of water here in California. So there's lots of places to go.
CONAN: Joseph, continued good luck to you.
JOSEPH: Thank you very much.
CONAN: Bye-bye. And let's see if we can get - this is Joe. Joe's with us from Nashville in Tennessee.
JOE (Caller): Hi. First of all, I wanted to point out to your guest that gasoline in automobiles is only a small use of oil. A lot of oil is used in plastic. So, driving less isn't going to help that. But the reason for my call is that I read an article saying that 60 percent of this price spike is estimated to be from speculation. And I wanted your guest to comment on the fact that in 2006 the Bush administration changed the rules to allow unlimited oil trading on foreign exchange desks. And from here in the United States, so much of that speculation is totally out of sight, unregulated, because these foreign desks don't have the same reporting requirements that the American Commodities Exchange does.
CONAN: Vijay Vaitheeswaran? Is speculation the source of our problems?
Mr. VAITHEESWARAN: There's no question that financial flows, speculation is a loaded word. The problem is probably bigger than the role of just mere speculators. There was an important change in how, particularly, pension funds behaved back around 2000. Pension funds typically didn't invest in risky investments, because this is your retirement money, after all. But they were persuaded around that time by Goldman Sachs and some of the other investment banks that using the very clever instruments that they devised, that oil could be a safe investment. And in fact, oil is a notoriously volatile commodity.
And I would have argued on the pages of the Economist, at the time, and now that the Commodities Futures Commission, the regulator, is looking more carefully at how these deals were structured, and the role that might have been played by what are mostly one way bets on oil, meaning prices are going to go up. And this is all great when were in an era when supply and demand is tight, legitimately tight, not due to speculation. It's easy to come in and think oil prices are only going to go up. But again, at the risk of sounding like a broken record, commodity markets go up, but they also come down.
JOE: Can I ask a follow up question?
CONAN: Go ahead, Joe.
JOE: How do you feel about legislation that's pending in Congress, that's been proposed that requires that somebody actually takes delivery of oil if they're going to bet on the price?
Mr. VAITHEESWARAN: I can take a stab at that. I would caution against the excessive intervention that some of the people in Congress advocate. For right now, that step, for example, would probably wipe out a lot of the paper market, the futures market in oil. Let's remember that there's a legitimate, and wonderfully liquid, market in paper contracts that actually helps make the world economy much more flexible, and nimble, to the benefit of consumers.
Back in the 1970s, during the oil shocks, we didn't have a vibrant futures market. What we had was very small interruptions in flow would lead to very big disruptions. You know, we all remember the gasoline queues, when the people were waiting to get physical supplies. You know, no matter how bad you think four-dollar gasoline is, nobody in America is waiting in line to get gasoline. So, there are a lot of good things that come from financial markets, and from the paper trade. I do think that the right thing to do is to make sure the abuses are looked into, to make sure that there's proper regulation of these markets.
CONAN: Dean Foust, do you agree?
Mr. FOUST: I agree. I've seen some estimates that - by critics who claim that there's up to 50-dollars-a-barrel speculation built into the prices. I think there is some speculation, not nearly that much. And speculation would be a short-term phenomenon. I think it gets back to Econ 101, supply and demand. An international energy agency recently did an exhaustive survey of the world's 400 largest oil fields, and concluded that there is - and they were trying to ask the question, address the question of, how much harder can the oil fields work? How much more can they produce?
They concluded there's very little slack. Something only - about two million barrels a day of additional production capacity, which is miniscule compared to current demand. And frankly, it would be so expensive to pump those remaining two million barrels that it's cost prohibitive. And plus, on top of that, you've got a lot of developing economies like China that - where the governments heavily subsidize the price of fuel in those economies. So these are some of the fastest-growing economies in the world right now are very price insensitive.
JOE: China's rise in demand has actually gone down.
CONAN: I just wanted to give somebody else a chance to get in on the conversation, OK?
JOE: Sure. Thank you.
CONAN: I appreciate the phone call.
CONAN: Just a couple of emails. This is from Stacy in Houston, Texas. I work for a company that's paid by oil companies to find the best ways to get oil out of the ground. My job security has never been better. Not only are our clients making a lot of money, which allows even the smaller companies to use our services, but also there is a great deal of concern about exploration and efficiency, which leads to companies like ours.
And this from Josh. We run a web store specializing in bicycle cargo trailers. Sales have been through the roof this spring, with strong correlation to the rise in prices. Everybody says they're selling their cars and using a bike cargo trailer instead.
Well, not everybody can do that. Let's get Kevin on the line, and Kevin's with us from Oregon.
KEVIN (Caller): Yeah, thanks for having me on the show.
CONAN: Go ahead, please.
KEVIN: Yeah, just calling to comment on my personal commute and on the forestry industry as a whole. My daily commute, I have a 50-plus mile drive, and then work up in the woods, and so I need to drive a truck, which kind of puts things in a pinch. And then for the forestry industry, log prices right now are at an all-time low, and the haul costs for both equipment operation and log hauls requires diesel, and that's kind of having a two-fold impact on the logging industry. So there is a lot of foresters and loggers that are affected by the high gas prices in a pretty substantial way.
CONAN: You must feel a knot in your stomach every time you drive past the diesel station.
KEVIN: Yeah, gas in northern California is about $4.67 right now.
CONAN: Wow. Let me ask you, Dean Foust, obviously, there are regional differences. I remember hearing a survey result this morning saying the places most affected are in the American South and in places, well, like northern California, Oregon, where people have long commutes, Montana, South Dakota, places like that.
Mr. FOUST: Indeed, the effect is being felt disproportionately by the rural parts of the economy versus the urban parts. But again, we're a flexible economy. That has always been one of our historic strengths, and I think we will continue to be so. The challenge for us will be - you know, I made the point about the unit of economic output. The challenge for us will be to figure out how to double the economic output.
In other words, use half as much oil in the future to produce the goods and services of the economy. I do want to come back to one of the points we were talking about earlier, about whether the members of OPEC and Saudi Arabia are crying crocodile tears over the price of oil. I think they're a little concerned, actually, because yes, they're reaping money profits hand over fist right now, but there is something - there is such a - too much of a good thing.
And I do think they are worried that at some point, if oil gets to, you know, 150 dollars a barrel, 200 dollars a barrel, 250, then President McCain or President Obama comes into office, and you know, proposes a national energy plan, and throws 100 billion dollars or 200 billion dollars at it. And suddenly we all put solar panels on the roof of our houses and drive electric, battery-powered cars and so on and so on, and suddenly, you know, a little hyperbole here, but oil becomes a sludge that doesn't have much of a purpose.
CONAN: We're talking with Dean Foust of BusinessWeek and with Vijay Vaitheeswaran of The Economist. You're listening to Talk of the Nation from NPR News. Let's go to Safadin (ph), Safadin with us from San Antonio, Texas.
SAFADIN (Caller): Yes, thank you for having me on your show. Actually, I'm driving a taxi. I used to put like 30 dollar gas for my daily trips. Now I'm putting 60 or 70, 70 dollars a day. So I'm not making that much profit right now. My question to your guests is, what can our government here do to raise the value of the dollar so it can bring these prices down? And I am happy to take your answer off the air.
CONAN: OK, thanks very much for the call, and drive safely, Safadin.
SAFADIN: Thank you very much.
CONAN: Bye-bye. Vijay, any thoughts about what the government could do to raise the value of the dollar?
Mr. VAITHEESWARAN: Well, I think that we're unlikely to raise the value of the dollar to deal with the oil problem, but that doesn't mean there's nothing we can do. I think there's something very powerful the government can do, and that has to do with demand. Let's remember, in the supply/demand equation, OPEC countries have the oil that gives them tremendous leverage over supply, but we're the people that consume the oil.
And when we've gotten serious about energy efficiency in America. And we did it before. In the wake of the '70s oil shocks, we got serious about vehicle fuel economy. We got serious about industrial efficiency. We showed dramatic improvements in vehicle improvements, in, actually, the early days of the Reagan era, the legacy of the Carter years. We improved the fuel economy of American vehicles dramatically, even at a time when the economy was booming.
But what happened? In 1986, the oil price collapsed, and we entered a period of low and stable oil prices that lasted through the 1990s. We forgot the lessons that we learned, that we can actually break the back of the OPEC oil cartel if we invest in energy efficiency, alternatives to oil, and we change the way that we move our cars and buses. Right now, we're at close to a 20-year low on fleet average fuel economy of American vehicles, new cars, and that, I think, is part of the symptom of the problem.
CONAN: So you would agree with Dean Foust about the resilience, though, and the adaptability of the American economy?
Mr. VAITHEESWARAN: It was ever thus. We've always responded. Right now, if we take the opportunity of high prices to actually be a bit proactive, again, to learn the history lessons that we forgot in the '90s, that oil is only going to grow ever more problematic in terms of foreign policy, and the potential that oil has to shock the world economy continues, because again, this price spike will moderate at some point. We mustn't allow that moderation in price to let us say, well, the problem's all over again. Let's go back to the way things were. Bring back the SUVs.
CONAN: Where's my Hummer?
Mr. VAITHEESWARAN: Yeah, exactly, where's the Hummer? What I've argued for is that through public policies and through individual behavior, we really embrace a different paradigm that will help us get off of oil and respond to the crisis of the future, and by, in effect, taking the petroleum out of the equation.
CONAN: And Dean Foust, one final question to you. I mean, would you expect that a President Obama or a President McCain is going to come in with such a bold energy plan?
Mr. FOUST: Gee, you're asking me to talk politics?
(Soundbite of laughter)
Mr. FOUST: Let's talk a little religion and while we're at it - no, seriously, you tell me the price of oil next January, and next summer, 18 months from now. You can look historically and say that the Republicans have always historically argued that the response is to increase supply, and therefore to allow drilling in many historically-protected areas. And that the Democrats have historically said the answer to high oil prices is through consumption and tax credits for alternative energies.
So, you know, those are the stereotypes, but if this starts having a serious impact on the economy, then yeah, I think that's going to affect the degree of the response. I mean, right now, for all the talk of recession, the latest economic estimates that I've seen off of Wall Street, economists are still calling for one-percent growth this year. It's not great, but it's not the great, grand depression we were all talking about a few months ago.
CONAN: Dean Foust, thanks always for your time. Appreciate it.
Mr. FOUST: Thank you.
CONAN: And Vijay Vaitheeswaran, thank you for your time as well.
Mr. VAITHEESWARAN: Great to be here.
CONAN: They work for, respectively, BusinessWeek and The Economist. Coming up, Dan Neil of the Los Angeles Times on the Opinion Page with advice for ecotourists. Don't go. This is NPR News.
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