buses

[meganursula]

My cold has been giving me breathing issues, so i took the bus yesterday and today.

Yesterday was annoying because i'm not on a schedule for taking the 'nice' bus, and the stupid bus, is, well, stupid. If i get up in time to take the commuter line it comes on time, and gets to work quickly. If i leave late enough to take the same i also get predictable schedules and a short ride. But, yesterday i left a couple of minutes late and couldn't stay late enough at work, so i had to take the dumb bus, which gives me a 45 minute or more commute, vs. the 20 on my bike. Today i left work early enough and am staying late enough that the time is less onerous. I even finished reading a paper while i was on the bus!

Also, i seem to have lost my id card, with my bus pass stuck to it, so i had to pay with money. That sucked. I'll need to replace the card, i guess - i can't even remember when i last used it, except that is was probably to get into work right before my thesis was due.

At any rate, thank heavens the cold is abating, and by Thursday (the next day i come to the office) i should back on my bike!


I wanted to mention, though, that capitalism is working on our oil issues. This summer gas prices finally got high enough that people started responding. Bike stores are sold out of bikes (used bikes are particularly hard to come by), and the buses are packed. People are really starting to figure out alternatives to driving their single occupancy cars. The most wondrous thing is that economics are also working on the supply, and oil prices have started to drop.

I've been saying for a while that what we need is to increase gas prices, not decrease them. People need to start thinking about alternatives, and clearly they need the financial incentive to do that. I'm rather thrilled with these developments.

(And, yes, i know, its a regressive demand issue. There are people out there who really are being hurt by the higher oil prices, and who don't have the option to modify their cars or commuting options. People are being hit by higher costs for food and other consumables related to gas prices, and some of those people can ill afford those increases. I get that. Still, i'd rather see those people be helped out by a capitalist driven decrease in oil prices, or other means entirely, than an artificial influx or more oil.)

Especially given all of that, I am vehemently against increasing our oil supply by opening up new oil reserves. I think that would be a temporary solution to a huge problem. I think it would harm our environment directly, while only delaying the need for different solutions to our energy issues. I think forcing people to become creative to find those solutions by allowing the oil prices to stay high has very little downside (exception noted in parenthesis above). The higher gas prices mean that people are walking or biking, which is a healthy habit for most people to adopt. It means they are using transportation options that are less harmful to the environment, and that they are more likely to support or adopt newly developed technologies. This is all good.

Honestly, even if oil prices come down, i'd like to see auto-fuel prices remain elevated. Although i know that is a pipe dream only likely to be supported by a city-dwelling bike enthusiast like myself!

In short, though, this issue of oil is important to me. It is a big reason that i favor Obama over McCain.

Comments

[via-lens.livejournal.com]

My problem with the current fuel price spike is that diesel has climbed above regular gasoline, which is a purely artificial increase that has the most significant effect on consumer goods prices. As loath as I am to support strikes, I secretly wish for the kind of work stoppage that happened in the 70s when the truckers simply refused to run the lines and blocked the roads until diesel came down. Diesel is a higher pollutant but is far cheaper to produce and is currently the lifeblood of shipping in the US. That its price exceeds gasoline is baffling.

Long term, an increase in the availability of rail transport can also improve efficiency and consumer prices. That's one of Obama's platforms that first drew me to him: he openly supports federal investment in rail lines.

I too have noticed more buses, walkers, and bikes. Microsoft now runs the largest private bus fleet in the country with their Connector system and its adoption really spiked when gas prices went over $4. Combine that with the free bus passes for temps and full time workers and I feel good about working for them.

[mh75.livejournal.com]

I think there are a lot of complicated issues surround fuel costs for automobiles. Clearly much of the cost increase is due to oil cost increases (although tracing that back to honest supply and demand is also not straight forward), but it is obvious that there are other things going on. Biodiesel, for example, has also skyrocketed. I suspect some of that is honestly due to increased demand for grain. Some of it, though, i think is probably capitalization on the expectation that fuel costs have gone up (eg., profiteering). I honestly don't know about how diesel may track gasoline.

In the end, it doesn't matter too much for me. I'd like to see end user gasoline prices stay high. I'd like to see us attack the oil issue with an approach that is not opening up new reserves. I think that some of the difficulties with high gas prices (eg, my point about the regressive costs) can be approached by considering ideas that do not involve boosting the current rate of oil production.

As much as i hate to pay for parking, for example, making parking expensive and/or rare is one way to get people to take the bus to work instead of driving. It also places the onus for change on a population that is more likely to have an easy alternative. Giving shipping companies tax breaks would help address the high cost of transport while still allowing for capitalist forces to work for individuals who can modify their commuting options. Popular ideas? I doubt it, but i think they would be better for us in the long run.

MS is probably doing better with their public transport than the City of Seattle right now - the capacity of the bus system here is not increasing as fast as the demand, and the reluctance to get other solutions implemented still appalls me.

...
I wonder if i'll garner a dissenting opinion in my lj?

[bhudson.livejournal.com]

I'll dissent on the giving tax breaks to shipping companies bit: the same forces reducing car usage will reduce truck usage (in favour of either shipping more efficiently, or not shipping at all), and that would be a good thing.

There is a problem of long lead times to change how things are done, and the government might be justified in intervening to help the transition, with subsidies on both sides, reduced over time. Unfortunately, governments are good at sending out incentives, but not so great at scaling them back.

[mh75.livejournal.com]

yeah, it is tricky. I'd sort of rather have the free market figure out the shipping costs, too. However, it seems like a reasonable way to ease some of the more harmful side-effects of having high fuel costs, while still encouraging the general public to challenge themselves to conserve.
Ideally the trucking industry would be helped in the short term, while better infrastructure was developed in the long term. Governmental subsidization of both trucking and, say, rail seems fair to me.
Points noted about the difficulty the government has in reducing its subsidization over time, though.

[via-lens.livejournal.com]

Alternative solutions have to be front-loaded. It is clear that private enterprise is souring on the idea of spending billions on research and development for alternatives that truly reduce the need for oil: most of the new hybrids coming out are actually less fuel-efficient than the earlier ones, are based on old technology, and are vehicles that are not efficient in the first place, meaning they're meant to appeal to people who want to feel like they're doing something good without actually doing it.

Similarly in transportation, it takes years to implement large-scale transportation improvements. Microsoft can do it because they have a single location to which their employees travel (or else they build additional locations closer to where their employees live) and they can control all of the factors at once. Building more office capacity while building proportionally less new parking space means people will be more inclined to use the alternative methods of transporation or telecommute. But in a city like Seattle where parking is one of the most lucrative businesses you can be in when you own land, it's hard to squeeze off that pipeline. Sure, it costs more, but most people just accept it and pay the difference. (As you know, I stopped doing that years ago.)

To really make something like light-rail work, you have to front-load the whole project and build enough lines that they provide real services to a large number of commuters. You have to expect that it might take 10 years of operating at full capacity before the system operates within its budget. This is more than most individual voters are willing to accept because they'd rather pay the cost piecemeal by putting the gasoline in their own tanks or paying for their own little parking space over those ten years. Getting a critical mass of people to see the big picture is hard -- I worked on the light-rail proposal in 1992 here in Seattle and we're no closer to getting people to understand it. Amazing to think that if we'd succeeded then, in 1992 dollars, we would be operating at a profit and spending less on highway infrastructure now. :p

I think the only break that shipping companies need is a return to proportional profits on diesel fuel. If oil companies were making the same percentage of profit on diesel that they're making on gasoline, diesel consumer prices would come down by about 30%. Where the federal subsidies belong, in my opinion, is in improving the infrastructure to use means other than trucking for long distance transport -- which means rail and sea primarily.

[bhudson.livejournal.com]

I've been wondering about why the price of diesel is so high, give it's cheaper to produce. Is it that demand for gasoline has increased markedly less than demand for diesel?

I'm not sure what a "purely artificial increase" means. What's artifact and what's nature, when you're talking about pricing?

[(Anonymous)]

By "purely artificial" I mean that there isn't anything in the supply/demand equation that has made it disproportionately more expensive to produce diesel fuel. The same barrel of oil costs less to convert to diesel than to gasoline.

I think it would be hard to argue that demand for diesel has increased over and above the demand for gasoline. Rather, alternatives to diesel fuel are now available (as Megan mentions above) and they are very expensive, which has given diesel sellers some room to profiteer by increasing the price of diesel fuel while still keeping it below the price of biodiesel. Quite frankly, the biggest problem is that the major consumers of diesel will pay the going price for it. Those major consumers are shipping companies; a comparatively small proportion of the population by contrast uses it to power their personal vehicles (or in my parents' case, their RV).

So long as the major consumers of diesel continue to pay the rate charged for it, its price will continue to increase and drive inflation in consumer prices. Of course, these days if truckers shut down the Capitol like they did in the 70s they could all be held without charges as domestic terrorists. :/

[via-lens.livejournal.com]

P.S. I don't know why it logged me out mid-comment. :/

[bhudson.livejournal.com]

It must be the oil industry fighting back.

One problem I have with discussions about energy pricing is what we're engaged in right now: very little mention of data, but plenty of theories (I'm censoring myself from coming up with explanations, but I'm finding it very tough). Another problem is that one's complaint of profiteering is another's perfectly justified decision to charge whatever the market will bear.

The closest thing to data that I have is a vague notion that the amount of trucking increased faster than the amount of passenger transport, which I feel like I've seen numbers for; that would, as you point out, increase demand for diesel relative to gasoline. But my numbers are far too vague to determine whether it would explain the difference in prices.

In a competitive market, I have difficulty believing that offering a higher-price alternative could increase the price of the lower-price alternative. If it has, then either the market is not competitive, or I don't know economics.

[mh75.livejournal.com]

One problem I have with discussions about energy pricing is what we're engaged in right now: very little mention of data, but plenty of theories

It is almost always a problem in discussions with me. I have time to think about these issues, but not as much time to dig up data. I recognize it as a huge flaw, but, so far, don't often work to fix it. Perhaps i should try to get funding as an economist so i can play with the problems for real?

the amount of trucking increased faster than the amount of passenger transport, which I feel like I've seen numbers for; that would, as you point out, increase demand for diesel relative to gasoline.

Well, individual drivers can reduce car trips, and long distance travel is way down. But truckers aren't really able to make either of those reductions. Add to that the increase in the number of diesel cars on the road...

In a competitive market, I have difficulty believing that offering a higher-price alternative could increase the price of the lower-price alternative.

I believe that this could happen for two reasons:
1) you can not choose between these two alternatives immediately. Buying a new vehicle or a new truck is an action that has a long lag time. So you'd expect to see the free market work on the choices over a number of years, but not over the number of months that we've seen something like increased bus ridership. Additionally, there are not big rigs readily available in alternative fuel prices, even if some truckers were willing to switch to lower their costs.

2) i think with the private consumer (not so much the industries in question) you can rely on some ignorance. Fuel prices go up, so you can raise all fuel prices. Even if the reality says that only one type of fuel has gotten more expensive. The diesel market may be able to bear more cost increase because diesels get more miles to the gallon, so the price per mile goes up relatively slowly compared to that of gasoline cars.

Although, i just thought of, for some reason, with this particular problem - if a larger percentage of gasoline's price is due to processing, than a smaller percentage is actually dependent on the basic oil price. It might be that gasoline prices went up more slowly than diesel prices for that reason.

Another problem is that one's complaint of profiteering is another's perfectly justified decision to charge whatever the market will bear.

Yeah, i'm not sure, either. My sense is that, because there is a difference between ideal capitalist market response and real capitalist market response, profiteering occurs when an industry can increase their prices more quickly than consumers can or will react to those increases. In the automobile industry there is definitely some lag between when someone notices rising fuel costs and when they can remedy the problem - particularly people who need to pay for food that has been shipped by a third party, or people whose vehicle represents a significant investment for them. I believe that this causes people to call out 'profiteering' because they believe the oil companies could be charging less for their products, while they can not be reducing their requirements for those products.

[bhudson.livejournal.com]

You missedfixed a close-italics there.

Agree with the data problem. I'm as guilty as anyone, but I found myself coming up with a million theories and no way to determine which was useful without doing actual work.

Truckers are in fact reducing gas usage by driving slower, at least around here. Instead of barreling along as fast as possible, they now go about the speed limit, even when there's no cops around. Not even at 5mph over. I wouldn't have noticed -- it's my grandfather who pointed it out, either from having read about it or from remembering it from prior rationed times.

[pauldf.livejournal.com]

Truckers are in fact reducing gas usage by driving slower, at least around here. Instead of barreling along as fast as possible, they now go about the speed limit, even when there's no cops around. Not even at 5mph over. I wouldn't have noticed -- it's my grandfather who pointed it out, either from having read about it or from remembering it from prior rationed times.

I had read this. However, in my recent trip down to the Bay Area mostly straight down I-5, I didn't see it at all. Even where the speed limit for trucks was 5-10 mph slower than the speed limit for cars, the cars were going 5 mph or so over the car speed limit, and the trucks were going nearly as fast as the cars.

[pauldf.livejournal.com]

Long term, an increase in the availability of rail transport can also improve efficiency and consumer prices.

Yup. I'm definitely happy that Washington State has been investing quite a bit lately in rail; they're slowly improving the entire rail corridor from Portland to Vancouver (well, ok, the part that's actually in Washington State) to better separate passenger and freight rail and rail from other traffic. The result will speed up travel times to narrow the gap between train and car, and add capacity for a second daily trip to Vancouver before the Olympics there. That second trip will continue to run after the games are over.

I think we're not going to see many other long-distance rail improvements in our area for a long time, though commuter and light rail will hopefully continue to develop. I just don't see enough people putting up with the travel times in most cases, to travel to San Francisco, let alone Chicago or Los Angeles, even if infrastructure and technology improvements cut those travel times in half.

Rail is more interesting when considering the freight issue. It just suffers from the long lead time issue you mention further down.

[pauldf.livejournal.com]

Oh, also...one of the problems I think Amtrak needs to solve is the convenience issue. The European rail network is built around convenience in a number of subtle ways, and it means that people who are quite willing to pay for convenience still take the train a lot to get around.

For example, it amazes me that I have to get to the Seattle Amtrak station 20-30 minutes before boarding a train to Portland or Vancouver, so I can stand in one line to get a seat assignment, and get in another line to go out the door to get on the train. When I took Acela from New York to Boston, I had to hunt down a seat; apparently "reserved" means that there's a seat somewhere reserved for you just because they don't overbook (presumably), but it's not predetermined which seat that is. In Europe, for city-to-city distances, I really like getting my computer-generated seat assignment in advance. This also makes for much shorter stops. When you know whether you're near the front, middle, or back, and can look at a diagram which tells you exactly where on the platform your train car number will be when the train stops, the train doesn't have to stop as long.

Since Amtrak doesn't seem to have any system now, and would have to develop something new, they could actually do a better job than planes today, by only taking a window/aisle preference for single riders, and freezing assignments an hour or a day before the train departs, so you can get your seat assignment before boarding, but couples and groups can nearly always be seated together.

I'd also like to see better options for stashing bags on the train, and more public-private partnerships to have lots of amenities in/around train stations like DC and New York have.

[cheesepuppet.livejournal.com]

Especially given all of that, I am vehemently against increasing our oil supply by opening up new oil reserves. I think that would be a temporary solution to a huge problem.

Not to mention creating whole new problems of pollution a habitat destruction.

[sinthrex.livejournal.com]

Um. Wow.

Lot going on here.

A few thoughts:

1. Oil prices were going to drop. Not anymore. (http://www.nytimes.com/2008/09/10/business/worldbusiness/10oil.html?scp=3&sq=OPEC&st=cse)

2. Saying that it costs less to turn a barrel of crude into diesel then gasoline is somewhat disingenuous. Any given barrel of crude contains fractions that make up both gasoline and diesel. Through some interesting refining technologies, you can tinker with the output (to some degree) to effect the proportions you get out (by post-refining, blending, etc.).

3. Depending on the market, both refining capability, style and local tax structure are set up to support (and sell the maximum possible amount of) the locally dominant fuel. (Petrol here, diesel in Europe and much of Africa)

4. Following that note, demand for diesel has gone through the roof. Worldwide demand that is. Europe has shifted in a big way to diesel autos over the last ten years and diesel autos are starting to become popular in the US. And a by-product of our relentless appetite for goodies from elsewhere and our Amazon.com society is that the amount of goods shipped in the US has continued to go up at a rapid pace. Finally, the US has little diesel-centric refining capability, severely limiting local supply.

5. The shift to ultra-low sulfur diesel added up to $.25/gal to diesel.(estimates vary) The majority of this shift occurred in 2006/2007 making it hard to untangle from the rise in crude oil prices.

6. I don't know if winters have been bad, but any hard winter drives demand for fuel oil, which directly drives price for diesel (they use a lot of the same fractions).

7. The thing that annoys me about the "Drill and Pay Less" is that it's absolute, utter BS. The world oil market is not high school econ no matter how much some *cough, politicians* may want the voters to believe it. If we had done all the exploration, drilling etc in advance, and had merely sat on that capacity until now, that itty bitty fraction of not the world, but the US' oil demand would go on the market. At world market prices. Doing jack snot to the market. I don't think there's a Republican around that would say that inflating our tires would effect oil prices at all, but the delta is the same.

8. I agree that driving innovation for new energy sources is critical. But as a member of the 'haves' I'm not really comfortable with saying that I should tell someone who's net income is a fraction of mine and has dropped by a non-trivial amount due to rising commute prices, who's also facing a significantly higher food bill (fertilizers, transport, etc.) and tell them that it needs to stay that way "for their own good." I'm much more on board with Obama/Gore's "Apollo-style" approach.

[dr4b]

This is going to sound really weird, but can I use the bottom half of your post as a short article for one of my classes?
I've actually been discussing politics a little with this group (since the Japanese prime minister just stepped down and the US elections are a popular conversation topic here) and this is basically one of the conversation topics I want to raise with this class as part of the economy stuff.

[mh75.livejournal.com]

Uh, yeah, sure thing. have fun!