CRISIS IN THE PERSIAN GULF : Few Americans Are Heeding Bush’s Plea to Conserve Energy
Donald W. Majer considers himself environmentally conscious and worries that the mounting tensions in the Middle East could lead to another oil shortage. But don’t ask him to part with his navy blue Cadillac Fleetwood.
“I’m not going to run out and get a Toyota tomorrow,” said Majer, an insurance office manager from West Hills.
“People,” he added, “have to get kicked on the side of the head before they make any changes.”
That, more or less, appears to be the posture that most consumers are taking on saving energy in the face of the Persian Gulf crisis. President Bush has called on the American public to conserve to offset the loss of Iraqi and Kuwaiti oil, but so far not many people appear to be answering.
Buses are no more crowded than usual. Homeowners don’t seem to be lining up to buy insulation materials or clotheslines. Most vacationers are going ahead with their travel plans.
Only a sustained crisis, economists and consumers agree, will prompt people to change their ways with energy. Said Barry Wishengrad, general sales manager of West Valley Toyota in nearby Canoga Park: “I’ve yet to have someone come in and say, ‘Give me a good, fuel-efficient car.’ ”
Motorists got some comforting news Friday when the American Automobile Assn. reported that the average price nationally for self-service, unleaded fuel dipped by 0.3 cents to $1.25 per gallon--the first daily decline since Iraq invaded Kuwait on Aug. 2. The AAA survey came after several oil companies decided earlier in the week to follow Atlantic Richfield’s lead and either temporarily freeze, or roll back, prices.
Even with the past week’s increases, gasoline prices are about 40% lower than they were a decade ago after inflation is taken into account, said Carl Steidtmann, chief economist for the Ohio consulting firm Management Horizons.
Still, economists warn that consumers will have no choice but to alter their spending habits if oil prices start rising rapidly again because of hostilities in the Mideast.
Gasoline and other fuels are necessities, noted Sandra Shaber, an analyst with the Futures Group in Washington. When energy costs go up, “it really makes a difference in what’s available for other types of spending.”
Shaber predicted that if the Mideast crisis persists, consumers will respond by canceling or curtailing their trips and buying smaller cars and other energy-saving products. So far, travel agents say, the main change is that people are hurrying to book flights to beat coming fare increases related to higher fuel costs.
Even consumers who resist changing their energy-using habits may soon alter other types of personal spending plans. Consumer confidence surveys show that people are increasingly worried about a recession, and the Persian Gulf crisis is yet another warning sign, said consumer psychologist Richard Feinberg of Purdue University.
“We’re finding that consumers are talking about delaying spending for the things they want but don’t really need,” Feinberg said.
Already, a sprinkling of consumers appear to be at least investigating ways of cutting their spending on gasoline. At Commuter Computer, a Los Angeles organization that arranges car-pooling and van-pooling, a total of about 380 calls came in Tuesday, Wednesday and Thursday, about 25% more than usual.
“A lot more people are thinking about it,” said Jim Sims, Commuter Computer’s president. “It remains to be seen what they’ll do.”
He noted, however, that on Friday the volume of calls appeared to be back to its normal level.
Overall, the evidence is overwhelming that commuters and other consumers are sticking with familiar routines for now. For instance, the Southern California Rapid Transit District has pledged to put more buses on the streets and hire more drivers if an oil shortage is “declared.”
But at this point, ridership on RTD buses and the new Blue Line train from Long Beach to downtown isn’t up significantly, said spokesman Greg Davy.
Many New Yorkers said this week that they weren’t changing their daily transportation plans, either. Said Tony Marciano, a Wall Street investment banker with Goldman, Sachs & Co.: “This morning there were three people on the corner, and I waited for the next cab because I didn’t feel like squeezing in--crisis in the Persian Gulf or no crisis.”
It also was business as usual at home improvement stores. “Honestly, we’re not rushing out and insulating all our homes and stuff,” said the manager of a Home Depot store in Dallas. “You wouldn’t know there’s a gas crisis out there.”
Not that people are hostile to the idea of conserving energy. Debbie Boswell said the quality of the insulation of the new house she recently bought outside Atlanta was a “prime concern.”
“Even before this Gulf crisis, we wanted to conserve energy,” she said. “If the crisis continues or worsens, we will have to modify our lifestyle by conserving gasoline for our car and pickup truck. Fortunately, we have a sailboat instead of a motorboat.”
Meanwhile, some businesses are cheerfully figuring that they eventually will prosper from an energy crunch. “People might not want to drive so far,” explained George DeGirolamo, vice president for marketing at the Six Flags/Great America theme part in Gurnee, Ill.--about halfway between Chicago and Milwaukee.
“The energy crisis in 1978-79 was mildly beneficial because higher prices curtailed long-term plans and people looked for things closer to home,” DeGirolamo added.
Disneyland officials aren’t worried. During oil shortages, spokesman Bob Roth said, “locals tend to take shorter vacations, and we’re high on their list of alternatives.”
For now, however, consumers are doing little more than complaining about the prospect of higher energy prices. Many believe that the issue will soon disappear.
“The consumer has been through so many of these things in the last 15 years that it’ll take six months before they believe it,” said Richard Spears, sales manager of Jim Bess Mercedes-Benz in Calabasas, where customers still are coming in for gas guzzlers.
Billy Anderson, a 27-year-old oil title analyst in Houston, put it another way. “People at this point aren’t taking the Iraqi situation seriously,” he said. “They figure we’ll go in there and kick their rear and win, and put an end to it all pretty quick. I just don’t think prices are going to stay high. This is a short-term deal.”
Contributing to this story were Times staff writers Chris Kraul in San Diego and Chris Woodyard in Orange County, researchers Edith Stanley in Atlanta, Lianne Hart in Houston, Tracy Shryer in Chicago, Ann Rovin in Denver and Doug Conner in Seattle, along with intern Jennifer Toth in New York.
