The problem is not directly the cost of gasoline but the fact we have based our suburban housing supply on inflation of the money supply and ever more exotic loans to support rising prices. Rising transportation costs and also rising food costs with a stagnant economy brings this economic model that underpins suburban society to a end.

Its not the direct costs of either that are the problem but the effect they have on the financial underpinning of suburbia.

This is not to say that we won't keep some form of suburbia for those they both enjoy and can afford the lifestyle but most Americans can afford a depreciating house and a depreciating car at the current price levels.

Europe to some extent is different since it has a range of living styles people can fairly easily choose to live without a car and if they do choose to have one they have options as to how much they drive. Its difficult to compare the US and Europe since we don't have the choices most Europeans have. And of course taxes make up a large part of your fuel costs so again its difficult to directly compare the two.

Its important to understand the shear magnitude of the pickle we have gotten ourselves into in the US.

I think this is a fantastic article that show the shear size of the problem we face.

http://www.housingbubblebust.com/HM/HM-Main.html

The bottom line is that for housing in the US to return to sanity would require a drop in prices of 50-75% at the national level. This is Great Depression levels or worse. Not to mention elimination of inflation or even allowing persistant deflation to ensure a stable economy as it converts to a new low energy form.

If we had sane housing prices then transportation would not be a issue and I'd suggest that we could naturally move to lower or transportation needs and develop rail higher density housing in the cities and real villages surrounding a rail terminals in the country. I've said several times that EV's and other forms of transportation make a lot of sense as options around a rail based core transportation network.

What I see as impossible is not EV's and suburbia its conversion to EV's with their expenses coupled with saving our housing bubble we probably can't save it anyway and certainly trying to convert to EV's to support people living in houses that are falling in value as their expenses are increasing and their credit is drying up is a bit of a stretch.

This does not even get into the retirement of our baby boomers unfunded pension liabilities falling wages etc etc etc.
A pullback in consumer spending in a society that now depends on borrowing and spending. A rapidly degrading road network etc etc etc.

The number of assumptions your making in your EV calculations is enormous. If you consider a switch to EV's as we are forced to deal with our financial train wreck and the underlying loss of cheap liquid fuels at the same time then I think you will realize that at best they will be toys of the the wealthy. The reality is most Americans actually are poorer than the poorest people in India we are just now balancing the books.

We are going to be lucky to put in electric rail and keep our society functioning I'm simply saying we don't have the luxury of simply switching to EV's and going along our merry way. If we had not blown our housing bubble on top of our credit bubble if we funded sane pensions and if we controlled our medical costs and if we built decent houses thousands of ifs then it might simply be the problem your describing but its not.

This is why I'm actually of the opinion that peak oil right now threatens our very civilization we have gone so far beyond sanity that the added burden of dealing with a dwindling energy supply on top of all the other problems we will be forced to face including longer term stuff like global warming makes it a probably unsolvable problem even worse since it basically ensures we have no exit. Inflation simply does not work when basic commodities are in short supply without inflation we are dead. With inflation spiraling energy prices ensure the debt bubble will keep imploding.

The only way out that I can see is to offer people the chance to live a decent energy frugal lifestyle and let suburbia and EV's make it if they can. By giving them a chance to live at least part of their lives using little energy and saving money and further more limiting inflation so savings actually works we can build up the monetary base to invest in paid for EV's and suburban houses without a massive credit scheme. If thats what people still want. Some will some won't.

Finally I think we have to do it that way. I think high energy lifestyles can no longer be subsidized but have to be paid for with cash by those that can afford it. We simply can't wast our credit resources lending for EV's or suburban houses we need every penny we have as an society to fix all our other problems and fix our energy supply. We simply can't afford as a society to lend that much money to support the old suburban lifestyle EV's or not. Bottom line we simply don't have the money right now already at the society level and its rapidly expanding to the personal credit level and it will only get worse as peak oil continues and the baby boomers get older.

And wow its been three years. It looks like the comments archives don't go back that far.