|But what I don't get is that people are now spending over two bucks a gallon to drive there and buy extra, not the same three dollar lattes and sugar drinks.|
I have read several years ago that relatively cheap indulgences, i.e. relatively to a meal in an expensive restaurant, an expensive piece of clothing, a vacation, etc. can, though not necessarily have to, grow quite surprisingly in times of economic hardship. People then may forgo a more expensive indulgence, i.e. a vaction that may cost several hundred dollars for several trips to a cinema or Starbucks, each of which costs "only" several dollars and still have net savings, albeit less value for the money.