In The NewsMoney & The Economy

Why Lower Gas Prices Are NOT Allowing Consumer Revival

800px-Gulf_Offshore_PlatformThe drastically lower cost of gasoline was supposed to lead to a huge revival of consumer spending – why hasn’t that happened?

Economic theory assumes that if a consumer has more money available, they will spend it. One of American’s major expenses is on energy. Put these two together and consumers should be running amok on Amazon.com, eBay and local retailers – the numbers say it just isn’t so.

The issue is two-fold.

First, the decreasing cost of fuel only impacts those employed and needing transportation. Americans living off of transfer payments (EBT, wellfare, unemployment, etc) aren’t likely to go buy more goods just because regular unleaded finally dropped another .05 per gallon. They are on a fixed income and their income is not necessarily dependent upon their ability to get to a place of work.

Second, those that are dependent upon transportation to bring in a check do NOT believe that the lower prices are going to last more than a few weeks. Having felt the sting of the White House’s “necessarily skyrocket” energy policy, those families are hunkering down and keeping the savings close. Unless these energy prices start looking more mid-to-long-term, they aren’t about to go out to eat more, buy a new T.V. or visit the nearby amusement park.

The reason cheaper gas hasn’t miraculously resurrected consumer spending is that Americans understand that it is not White House policy, the economy or other longer term factors causing it to be low and they certainly do not believe that it will last.

Gallup CEO: Number of Full-Time Jobs as Percent of Population Is Lowest It’s Ever Been

Support Conservative Daily News with a small donation via Paypal or credit card that will go towards supporting the news and commentary you've come to appreciate.

Rich Mitchell

Rich Mitchell is the editor-in-chief of Conservative Daily News and the president of Bald Eagle Media, LLC. His posts may contain opinions that are his own and are not necessarily shared by Bald Eagle Media, CDN, staff or .. much of anyone else. Find him on twitter, facebook and

Related Articles

2 Comments

  1. The money save on lower gas prices is spent on higher food cost, every week the price of fool goes up. With more and more government rules and regulations the less money buys. Inflation is on the rise while the economy tanks, and the only solution government can come up with is higher taxes, more rules and regulations, and a mandatory health system that has brought about the 30 hour work week for those fortunately enough to have a job. We have a government that is so blinded by their own brilliance that they cannot see the simplest of things.

Back to top button