At some point, high energy prices begin to undercut consumer spending. The effect obviously varies by consumer, based on income and driving habits, at least. But the price of gasoline has shot up enough that its weight on GDP improvement has become a threat again.
AAA Fuel Gauge shows that the price of a gallon of regular on average around the United States was $3.604 yesterday, compared with $3.307 a month ago. The increase is enough to add hundreds of dollars in living expenses for families with commuters who have no alternative but to drive to get to work. Add that to trips to school and the gas station, and the miles pile up.
The burden on the consumer’s pocketbook has been hurt simultaneously by more than gas. Tax rates are higher for many, because of Washington-based decisions. Real income has been flat for a decade as wages have been pressured by the…
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