How should we understand the cost of a gallon of gasoline?gas_prices

This is a very serious question with a myriad of layers and implications.

The price of gasoline, at the pump, is the most prominent indicator of energy costs for a very large share of humanity. Whether driving a car or taking a bus or even walking on a street, the ‘arm and a leg’ brightly lit sign that sparks a “WTF” moment at some high figure is the most immediate interaction that people have with the price of energy.

However outraged Americans might be at $4.499 per gallon gasoline, that price doesn’t come close to reflecting the true costs of fuel. Not included are health costs (cancers, asthma, otherwise), the subsidies for systems using energy (such as tax money spent on roads, highway maintenance, police, parking, …), opportunity costs (what better uses for the land?), security (such as overseas military operations), and environmental damage — such as that pesky little issue of Climate Change.  Thus, Americans most prominent and most emotional engagement with energy prices sends false signals that misleads as to the true implications of burning a gallon of gasoline.

Recognizing this, the Center for Investigative Reporting put together this video to follow a gallon of gasoline to illuminate the different cost streams being left out of the price on the sign.