Last week, we attended a lunch meeting to hear Prof. Stephen Fuller report on the region’s current and future economy. Steve is a Professor of Public Policy at George Mason University, and Director of their Center for Regional Analysis. We try and tune in to Steve’s prognostications every year – he is kind of the Chief Weatherman for matters economic in the metropolitan area. His outlook for the months ahead: not much. We won’t take the dive that other parts of the country might face, mostly due to the Federal presence, soaring procurement, defense contractors, and so on. But we’ll see very little growth in the region’s $370 billion economy.
At the end of his talk, there was time for Q&A. I asked him what he thought would happen as gas prices continued to rise – what would Washingtonians do with $5 or $6 a gallon gas prices. I was hoping he would say that we would instantly build streetcars…
But like a good economist, he said we would follow the Theory of Substitutions: “Consumers, faced with a constant level of income, change purchasing decisions in the wake of price changes.”
Then last night on the news, we heard a report on how locals are dealing with rising gas prices. A woman, shown while she was driving her car somewhere said: “I can’t afford to buy food – I have to buy gas.”
Hmm. Tasty choices ahead.