Gas prices are once again dominating the national debate. But despite rhetoric, high gas prices aren’t hurting as much as they used to.
In 1981, when oil prices spiked following the Iranian Revolution, gasoline represented nearly 5% of the nation’s spending. In 2011, only 3.7% of spending went to gas, even though prices averaged at their highest level ever that year.
In addition to spending less, we’re driving more than ever — 90% more than compared to the early ’80s.
This isn’t to say high gas prices don’t hurt — they do. But for the average American household, which has an income of over $62,000 a year, the increase in gas prices represents a relatively small portion of total spending. For example, in 2008 gas prices were all over the news when they hit their all time high. But in 2010 when prices fell people barely mentioned them.
Yet spending on gas totaled only $12 more per week in 2008 than in 2011 – the same spent on “pets, toys, hobbies and playground equipment.”