Gas back to burning 4% of our take-home pay

Dollar bill sticking out of gas tank

Fuel prices are at an all-time high this summer, averaging more than $4 a gallon, according to AAA.

As a result, Americans now are spending an average of 4% of their take-home pay on gas, according to a recent report by the Oil Price Information Service.

That's twice as much as the late '90s and back to what we were paying in the early '80s, after the Arab oil embargos of the previous decade.

But low-income families in rural parts of the South, Southwest and Upper Great Plains are spending more than 13% of their pay on gas to reach far-flung jobs, schools and stores.

That makes the run-up in fuel prices a life-changing event for many low-income families in those areas who must drive long distances to reach jobs and grocery stores.

"The extra dollars spent at the pump mean electric bills are going unpaid and macaroni is replacing meat at supper," the New York Times reports. "Donations to church are being put off, and video rentals are now unaffordable."

Five of the 13 counties where Americans spent 13% or more of their income on gas are in Mississippi, four in Alabama, three in Kentucky and one in West Virginia.

If gas prices don't subside, the extra cost could force families to move closer to city-based manufacturing and service industry jobs, rural poverty experts say.

More densely populated parts of the country, such as the Northeast, are less affected because incomes are higher, jobs are closer and public transportation is more available.

In places like New Jersey, "it's painful, but it's not stopping people from living," says Fred Rozell, retail pricing director at the Oil Price Information Service. "But in areas where the income is not so high, it's obviously having a great impact."

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