How does high gas prices since 2001, impact the U.S. economy?

Question

lets think about travel costs, going to work cost, doing business cost, groceries, etc.,.....

Answer 1

The problem-skyrocketing gas prices--only began about 2004/5; before that the rise was modest. But your point is well taken.

ONe thing to keep in mind--a rise of this magnitude in a major staple commodity, like some other economic forces, isn't felt by the economy as a whole immediately, although, like the collapse of the housing market, individuals do feel short-term effects.

Over time, however, the high energy prices sllow economic growth by taking money out of consumers pockets--thus reducing their spending elsewhere. That's bad enough--IF that were the only major factor at work here. However,it i s not. The housing market collapse reduces new home buying, slashing jobs in the construction industry--among others. Further, the long term effects of deficit spending are well known: it leads to higher inflation, further reducing consumer buying power.

If you look at economic history, you will see that such a combinationn of factors always (and I mean ALWAYS) leads to recession--ad usually a severe one.

Answer 2

Its the same, it appears to cost more because the numbers are bigger, but the fact is if it cost you $100.00 in fuel for your trip in 2001 and you were making 6 dollars less than today, is the same thing as making 6 dollars more today and paying $300.00 in fuel, now if your wage did not increase you can not afford to go unless you use your credit card to compensate.
still the same you are either
Rich
Middle Class
Working but under payed
Just out right poor and most gas stations do not take food stamp debit cards for gasoline purchases

Answer 3

it creates huge strain on small business where 70% of American labor resides.

ironically, the people crying about how taxes cause economical problems, are also the ones supporting Exxon's free-market crushing of the rest of the economy, in the same way.