Oil is expensive, and it's getting worse. Is that a good thing?
A gallon of gas now averages $3.65, up from just $1.96 two years ago, an increase of 86 percent. Even if gas prices don't climb further, that tiger in your tank is taking a painful bite out of your budget. When gas prices rise, so do gas taxes -- by an additional 49 cents per gallon. And the gas tax is among the most regressive, hitting the low-income as hard as the rich.
On the other hand, environmentalists see high gas prices as a helpful step toward the development of alternative energy. Secretary Treasury Steven Chu notably said "we have to figure out how to boost the price of gasoline to the levels in Europe" to make Americans trade in their "love affair with the automobile" for a marriage to mass transit.
This week's Working it Out question: If you were the U.S. energy czar, what would be your #1 proposal to influence the price of gas?
Here are some possibilities to get you started. Prices might RISE if the government:
-- restricts future drilling. Politicians could perhaps get that costly medicine to go down by couching it as "protecting the safety of environmentally sensitive areas against another BP- or Exxon/Valdez-like disaster."