Peakguy at The Oil Drum (found via Environmental and Urban Economics) provides a list of 12 actions that summarize what "peak oilers (Citizens for sustainable living?) are for." This is my short list of very inexpensive things governments could do to reduce oil use:
1. Stop subsidizing the oil and power industries.
2. Stop subsidizing agriculture.
3. Stop building and taking care of roads. Sell them.
4. Remove barriers to international trade, so that inefficient (in terms of oil use) domestic producers loose their artificial advantage over more efficient foreign ones.