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Gas prices go bananas
by Susan Mires
Sunday, June 22, 2008

The No. 1 economic worry for most people these days in gas prices.

I’m trying not to fret too much. There’s nothing I can do about fuel markets and a certain amount of driving just has to be done.

What really has me losing sleep, though, is bananas.

Think how far a banana has to travel from a tree in Tegucigalpa to reach my kitchen in Northwest Missouri. The whole trip is fueled by petroleum. Will there come a time when it’s just not cost effective to ship bananas any more?

What if $4 is the magic number where banana splits are splitsville?

To try to ease these worries, I’ve been reflecting back to college days when I was a tutor for agricultural economics. Bananas, just like corn and pork bellies, are an agricultural commodity.

One of the most difficult concepts for students to grasp was the difference between a change in the quantity demanded and a shift in demand.

The first is a simple movement along the demand curve. Prices goes up, consumers buy less. Or the grocery store puts 24-packs of root beer on sale and people buy more.

On the other hand, a shift in demand is when a whole other line is drawn on the chart.

It seems like the fuel market has experienced a shift. Consider this conversation from last week:

“Did you see that gas went down?”

“Yeah, it’s down to $3.81.”

Only $3.81 per gallon? Break out the party horns. Happy days are here again.

So much of our economy — even the way our society is structured — is based on transportation that is, if not cheap, at least affordable. Tilt the supply-demand table for gasoline and everything goes skittering.

So far, most of us are simply complaining and coping with the cost of getting around, but significant shifts are starting to take place.

Employees are either moving closer to their jobs or finding jobs closer to where they live. The days of one spouse working in St. Joseph and one in Kansas City seem to be nearing an end for all but the best-paid professionals.

Maybe families will decide to live, work, shop, worship and attend school all in the same community. The concept seems so 1948, but in a time of $130 oil, climate change and all things eco-friendly, it also has an attractive retro-progressive feel.

I wonder how easy it was to find bananas in the local grocery store in 1948.

Perhaps we are getting over-wrought with the whole gas situation. Four-dollar fuel may be disagreeable, but in the near term, it’s likely I’ll be able to enjoy bananas and also afford to drive to work every morning.

But fair warning: If the banana supply gets cut off, things could turn ugly.

Business editor Susan Mires can be reached

at susanm@npgco.com.

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