More Dogs on Main Street
I got another letter from the IRS about the big economic-stimulus program. The first one announced that they were going to be sending me a check. It was like the "You might have already won" letter from the Publishers Clearinghouse sweepstakes. The first letter didn’t say how much I was going to get, or when I would get it. It provided no useful information.
This week’s letter announced that my check was in the mail. Apparently I won’t be getting quite as stimulated as I had hoped. Still, the check is supposed to be arriving soon. When the check gets here, they will have sent three separate mailings on this. The printing industry has certainly been stimulated.
The stimulus program was supposed to send us all out on a consumer spree, buying stuff we couldn’t otherwise buy or taking a vacation. Let the good times roll. It isn’t working exactly as planned. People are spending the money on luxuries like groceries, or rent, or socking it away. There was a little uptick in the sales at some of the big retailers, but not what was hoped for.
Apparently people just aren’t in the mood to be stimulated. Measures of consumer confidence are at their lowest level since 1992. The news is full of doom and gloom on the housing front, and even people who are not planning to move are uncomfortable with the idea that their houses are worth less than they paid for them, maybe even less than they owe.
Then there’s energy. High fuel prices are changing the way business functions. There were a few parts missing on the new irrigation system for the farm. Normal behavior would have been to stick them on a truck and get them here. But the word from the factory is that no truck leaves with less than a full load.
My neighbor and his brother are partners on a farm in Kansas. They are putting up a big metal barn/shop. He’s getting the same story. The factory won’t ship until the truck is full. His building is about 98 percent of a load, so his project is delayed until somebody else in the general neighborhood orders an outhouse to fill the truck.
I ran out of propane because I hadn’t planned on running the furnace through most of May and June. It used to be possible to get a hundred gallons or so, and then watch the price over the summer so I could fill when it is cheap. No more. They won’t drive out unless they fill the tank. And so much for summer prices last fall it was $1.87 a gallon; this week propane is $2.58. I guess I’d better start cutting firewood.
We’ve all been through economic ups and downs before, and certainly will again. Park City real estate has bounced all over the place, with dramatic booms followed by cataclysmic busts, only to boom again. A house on Park Avenue I could have bought for $68,000 25 years ago recently sold for over a million. We’re not so different from the rest of the country. I’m old enough to remember when gas cost 25 cents a gallon. When it shot up to a buck, we thought it was the end of the world. It more or less was for Ford, Chrysler and GM.
The current energy prices could be as phony as the California electricity crisis a few years back. That turned out to be nothing more than a market manipulation by our old pals at Enron. At the time, it was blamed on everything from the additional electricity demand from all those cell-phone chargers to the air conditioning load created by millions of computers. The problem went away once the market shenanigans were exposed.
The $4-a-gallon gas (or $5 diesel) could be just as artificial, but it feels pretty real. World demand for energy is increasing as billions of people in China and India get electricity in their homes and begin to use cars for transportation. From all I’ve read on the topic, world oil production and proven reserves are pretty difficult numbers to get a fix on. The Saudis don’t publish their reserve numbers, and there’d be no good reason to believe them if they did. So we don’t really know what they have left in the ground.
There seems to be a consensus among the experts that we aren’t adding new reserves at the same rate that existing oil fields are being depleted. Prices will fluctuate, supply disruptions will come and go, but the overall trend seems to be that oil supplies will only get tighter for the foreseeable future.
In talking with friends and family, there is an unmistakable sense that life has changed. Nobody is closing off half the house, or abandoning the SUV on the side of the road. But things are different. My neighborhood is mostly summer cabins. We’re closing in on the first of July and many of the summer neighbors haven’t even turned their water on yet. The cold, wet spring may have put a damper on it, but I suspect the price of gas has something to do with it, too. Nobody is driving up for an afternoon of fishing this year.
I’m making fewer trips to Salt Lake, and even into Park City, than usual. I’m busier with projects at home, but when I hit a snag that requires a Home Depot run, they usually get put off until there are other errands in town. There was no deliberate decision to drive less. It just happened. That means fewer doughnuts from the Chevron in Kamas, fewer lunches in Park City restaurants, fewer impulse power-tool purchases at Home Depot. If my changed pattern is typical, multiply it by a few million people and business is going to get slow in a hurry.
There’s a sense that the changes are permanent, and that we may only be at the beginning of the personal adjustments. The American people seem way out in front of politicians in recognizing that things need to change. It sure would be nice to have some leadership on the issue.
Tom Clyde served as Park City attorney in the 1980s and is the author of "More Dogs On Main Street." He has been a columnist at The Park Record for nearly 20 years.
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Court report: Week of June 22