An interesting post from last month on those hidden costs and benefits of higher gas prices. Turns out, according to some smarty-pants economists, that if the price of gasoline goes up (if, for example, we impose a gas tax), people carpool and ride the bus more, resulting in less congestion and therefore net time savings for the people on the highway. But ah, for the poor slobs who switched to the bus?
Note that while the time-savings compensates those who continue to drive, those who switch transit modes may have reduced welfare.
(Note that I quote here because I love the smarty-pants economists’ way of talking. Reduced welfare. I just love that turn of phrase. It disguises so much.)