I love higher gasoline prices

Yes, you read that right: I do in fact love higher gasoline prices. More specifically, I place high value on having a clear economic signal being sent to consumers and to car companies and to entrepreneurs and their investors: Shift ASAP to more energy-efficient transportation options.

I personally believe that such a shift is already underway, but unfortunately it is running as slow as molasses.

So, the good news is that higher retail gasoline prices deliver a low blow to consumers. Some of those consumers will rebel and either drive less (maybe take the bus or bicycle or walk) or buy a more fuel-efficient vehicle or shift to an alternative fuel.

Car companies may in turn take a hit because they sell fewer of the high-priced gas guzzlers. Some of this pain will cause them to re-tool their own business models to exploit the "interest" in fuel efficiency. This will in turn open up possibilities for entrepreneurs to introduce new technologies into the market.

Lower gasoline prices would reduce these incentives. Even higher gasoline prices will only increase the incentives to promote fuel efficiency and non-fossil fuel alternative sources of energy. Good stuff. And it will happen quicker the higher and faster retail gasoline prices rise.

In the end, the consumer will be a big winner, but there will be short-term pain. The key is for the consumer to pass the pain on to the other players in the energy and transportation food chain. Consumers need to get active and push back in a healthy and constructive manner.

Passive consumers are weak economic agents, enabling debilitating stagnation to build up in the economy. Active consumers (changing their consumption habits it reflect their own "values") are strong economic agents, facilitating the dynamic equilibrium associated with a strong, healthy, vibrant economy.

This is what it is really all about: clear economic signals. As a society, we need to assure that economic signals are omnipresent and as clear as possible.

-- Jack Krupansky