“Be kind, for everyone you meet is fighting a hard battle” - Often attributed to Plato but likely from Ian McLaren (pseudonym of Reverend John Watson)

Sunday, March 22, 2015

Your car goes 3.5 m.p.h.?

John Michael Greer, the Grand Archdruid of the Ancient Order of Druids in America, publishes a weekly post at his site, The Archdruid Report. Greer is a much deeper thinker than I, particularly with respect to the interplay between past, present, and future. He describes his area of thought as the "history of ideas," and his grasp is broad and deep, regardless of whether you agree with him or not. A steady diet of The Archdruid Report would certainly depress me, though Greer does not strike me as depressed. He's certainly "cocksure" though, in the sense of certainty of his conclusions.

Nevertheless, I read his posts from time to time and invariably find them thought provoking. Today, in reading his post entitled "Peak Meaninglessness," I found him citing Ivan Illich from "Energy and Equity" (available as a free pdf download) contending that
"Illich’s discussion focused on automobiles; he pointed out that if you take the distance traveled by the average American auto in a year, and divide that by the total amount of time spent earning the money to pay for the auto, fuel, maintenance, insurance, etc., plus all the other time eaten up by tending to the auto in various ways, the average American car goes about 3.5 miles an hour: about the same pace, that is, that an ordinary human being can walk."
Is it true? If it is, does it have any meaning? Since, for reasons that should be obvious, I'm not interested in using my personal financial details for such a calculation, I'll posit an American household earning the median income of $52,000/year. The household consists of a husband, wife, and two children. The husband works 2,000 hours/year and earns $40,000 and the wife works 1,000 hours/year and earns $12,000. As an aside, this family doesn't live in Southern California. The average hourly earning is thus about $17.30/hour. Of course they'll only bring home, at best, perhaps $14/hour after taxes.

I'll assume two cars traveling a total of 26,000 miles per year with an average of 1.2 people in the vehicle for 31,200 passenger miles per year. The vehicles average 25 m.p.g. and gas costs $3.80/gallon, so they spend about $3,950/year on gas.

One car is a relatively new (say, two years old and purchased for $29,000 on a five year loan at 5% API with 20% down) five passenger sedan. The monthly payment is around $440, or $5,280/year. The other is a minivan on a three year lease with monthly $3,000 at signing and $300/month lease payments, or $3,600/year. They paid $8,800 up front to have the vehicles but, since interest rates on money market investments are close to zero, the opportunity costs are quite low, so I'll use the up front cash divided by the respective term in months. This adds about $2,160 to the annual total. The total to finance the cars is $11,040/year.

They take the vehicles in for scheduled maintenance a total of eight times per year and spend $300 each time (sometimes less, sometimes more depending on the service required by the schedule). The total is $2,400/year.

This family has decent driving records and no teen drivers so the annual insurance premium is about $1,500.

The grand total (leaving out car washes, aftermarket accessories, etc.) of annual expenses is $18,890. Wow, that IS a lot of money! Now, this $18,890 takes 1,350 hours (45% of their working hours) of this family's time to earn. So the final result is in: 26,000 miles/1,350 hours is about 19.25 miles per hour. This is about 5.5 times faster than Illich's estimate. So the answer to the first question, "is it true?", appears to be "no."

The second question is not so easily answered. The entirety of this family's lifestyle revolves around the vehicles. Without them, it's unlikely (though certainly not impossible) that the $52,000 would be earned. And, while a vehicle undoubtedly constrains them financially, it also enables them to do many things that would otherwise be difficult or impossible. A vehicle-free lifestyle is certainly possible (I've lived such a lifestyle at various times and for various reasons), but this family has decided that the tradeoff is worth it. I WILL say, however, that they'd have been much better off with different vehicle choices. Another way of saying this is that I believe I've made assumptions that are generous to Illich's claim as repeated by Greer.

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