In America, rural regions stand to suffer significantly from the effects of high oil prices and may face substantial challenges in the years ahead. Rural areas generally lack public transportation, forcing people to spend record amounts of their income on energy. Up from 1.9 % in 1998, Americans on average now spend about 4 percent of their after-tax income on transportation fuels, according to Brian A. Bethune, an economist at the forecasting firm Global Insight. The number is worse for rural residents who are seeing as much as 13% of their paychecks spent on transportation. At the same time, the total amount of miles traveled on U.S. roads has dropped by some 2.8% this year. The increase in cost and decline in demand has resulted in rural interstate travel decreasing five times more than urban interstate travel.

At current or higher price levels, life in rural America is simply unsustainable. For example, Holmes County, Mississippi with a median income of around $20,000 is currently spending 16% ($3,200) of that on transportation. Should this continue, rural residents would be forced to migrate from rural areas to urban centers in search of greater economic opportunity, affordable living, and to take advantage of publicly subsidized transit systems. Christopher B. Leinberger of the Brookings Institute argues that in the long term other core governance functions like "schooling and safety are likely to improve in urban areas" as the tax base increases with a population influx.

However, some analysts believe that the effects will not be permanent and that rural America will adapt to these new economic realities. Michael Hicks, a professor of economics at Ball State University, explains, "Rural retail centers are likely to see a lot more traffic as consumers are not willing to make the long commute to the big city."

Photo credit: Cindy Seigle