Americans’ longstanding addiction to gasoline will continue well into 2008, despite rising fuel costs, and may contribute to a slowdown in the overall economy, a new CreditCards.com poll reveals.
Two out of three Americans say they’ll cut back on spending for other things so they can continue to fill their gas tanks in 2008, with nearly a quarter saying they’ll cut back significantly on other spending. If they follow through, it will not bode well for the economy in 2008, say oil industry analysts and economists. Rising gas prices, the housing slump, the sagging dollar, the employment outlook and the stock market all may converge during the year, boosting the odds of a recession, they say.
Kajal Kapur, a Virginia energy and environmental consultant, says the cost and availability of energy will be a key player in how the overall economy fares: “It would definitely contribute to the slowdown of the economy because of the multiplier effect: Spending less would lead to less consumption of those things and less jobs being created in those areas.”
The poll found:
The poll also suggests that people living in Western states, already gouged by high oil and gas prices and used to paying more at the pump, are more certain than the rest of the nation that gas is going higher. Northeasterners, with fewer wide open spaces to traverse, are least likely to cut back on driving. Those earning more than $75,000 a year are least likely to cut back on driving, no matter what the cost, the poll shows.