How can people afford cars?

Meh, everyone's fucked anyway because of the consequences of peak oil.

Then people won't have to be dictated to by their governments; they won't have a choice.

Everyone's not fucked. Even if we are past or approaching peak - which is still very much moot - there's a lot of oil left in the ground, enough to keep us going while we switch to alternatives. And the fact the price keeps going up means those alternatives get more and more attractive all the time - if the oil ran out with no warning at all, then we might be fucked. But it won't.

The peak oil debate is amusing because most people agree that oil is finite and that when it runs out we'll need to have switched to something different. It's just none of us know when that'll happen, or if it has already started. But in any case, the market is working quite effectively to persuade people to consume less and use alternatives through the price signal, so there's not so much to worry about really.