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Updated to correct a reference to additional taxes levied by states on regular gasoline.
TheStreet) -- If you were around in the 1970s, you'll undoubtedly cringe to recall leisure suits and disco dancing. Even more unsettling: the memories of trying to pump gas.
Twice during a decade marked by double-digit inflation -- in 1973 and 1979 -- oil shortages caused by an OPEC embargo and political unrest in Iran, respectively, made it costly and aggravating to fill your tank.
In 1979, short supplies of gas meant rationing and lines of cars stretching far down the streets.
In 1979, gas sold for roughly 90 cents a gallon, a little more than $2.60 in today's dollars and much less than the $4.14 high seen in 2008. But short supplies meant, in many states, that you could gas up only on designated days of the week. Lines were huge, stretching far down the streets of service stations. Sales of lockable gas caps soared as a preventative to roving thugs who would brazenly siphon out your hard-fought fuel while you slept.
Today, with gas above the $4 mark at many
Exxon-Mobil(XOM - Get Report),
BP(BP - Get Report) and
Chevron(CVX - Get Report) stations across the nation, things haven't gotten quite that bad. There is, to be sure, pain at the pump. But gas supplies remain healthy and free -- despite political unrest in many oil-producing nations. People grumble and count their pennies, but they seem to have adjusted. In fact, gas prices appear poised to even drop a bit in coming days.
But when will they get pushed over the edge? Is $7 a gallon enough to cause personal pain? Is $10 unthinkable or a worrisome milestone that will eventually get here, as it did in Europe?
How high, or low, gas prices will go is really anyone's guess. What you pay at the service station now has as much to do with commodity speculation, the value of the U.S. dollar and taxes as it does with the actual supply chain.
The government could, for example, levy greater taxes to raise revenue and, in theory, reduce consumption.
The federal excise tax on gasoline is 18.4 cents per gallon for regular, and states and local municipalities add their own increases. For example, the total tax hit averages 66.1 cents in California, 63.6 cents in Connecticut, 64.2 cents in Hawaii, and 52.8 cents in Florida.
The Obama administration tried to distance itself quickly from a plan to tax motorists by tracking each mile they drive, which was contained in a leaked draft of the Transportation Opportunities Act. A similar proposal for a mileage tax was floated by the nonpartisan Congressional Budget Office as one method to fund plans to spend $556 billion over six years on transportation projects.
Here's what happens when a gallon of gas hits $5, $7 and $10: