A passenger is someone who travels in a vehicle but does not personally control the movements of the vehicle. Drivers drive; passengers ride.
At one point in human history, passengers did not exist. People used their feet to go where they wanted to go, and while a person could be carried by another, this was usually a temporary state, brought on by the fact that the person being carried -- a tired child, a sick mother, an injured comrade -- was in some way not well. Ideally, everyone walked, ambled, strolled, jogged or ran to their destinations, using the bipedal locomotion accorded to them by nature/god(s).
With the invention and construction of the first vehicle able to carry multiple people, the passenger was born. It only takes one person to pilot a vehicle; in fact, having multiple pilots only needlessly complicates the situation. (We'll brush aside the numerous anecdotal and fictional accounts of multiple children/animals driving cars -- one at the wheel, one pushing the pedals -- on the grounds that they are silly.) So you have one person doing all the work, while the other commuters are just sitting there, not doing anything.
This is a strange and novel state to be in -- you are in motion but at the same time perfectly still -- this sensation, the synthesis of forward impetus and static tranquility, is unique to the passenger. The person in charge of the vehicle must at least concentrate to create movement, but the passenger is under no such obligation.
Nearly everyone living in an industrialized nation today has experienced being a passenger in someone's car. Riding in a car is different from riding almost all other forms of transportation (plane, bus, train, etc.) because you are so close to the driver, physically and emotionally. The driver is right next to you, and the driver is probably someone you know. Often it is someone you know really well. This is essential because being a passenger requires trust. The driver must be qualified, since you are putting your life into his or her hands. The airplane pilot, the train conductor, the bus driver -- these people are professionals, and so you trust them (to an extent) because of their vocation. (Taxi drivers are a difficult anomaly best discussed in depth elsewhere.) But you trust the car driver because you know the person, or you at least know something about the person. Motorists' credentials are their character -- you let them drive you around because you respect them. If someone is a bad driver, that doesn't make him a bad person, necessarily, but it does reflect poorly on him.
There are essentially three types of passengers in a typical four-door sedan: front seat, back seat (left or right) and back seat (middle). (The roles are a bit different for coupes, pickup trucks, vans, minivans, SUV's, station wagons with seats facing out the back window, etc., but they are still, I believe, all variants of these three basic types.) Each position carries with it a collection of social connotations, codes of behavior:
Front seat. Also known as "shotgun." The person in the front seat has a certain set of privileges and responsibilities. The power the front seat passenger has is minor compared to that of the driver, but still substantial. The front seat passenger controls the radio and air conditioning while the driver is occupied. The front seat passenger has lots of personal space, and an adjustable seat. The front seat passenger can be asked to hold the driver's things if the ride is a short one. The front seat passenger is closest to the driver and shares the driver's view through the windshield. The front seat passenger is the driver's mirror image.
It is easy to see why being in the front seat is so often an envied, coveted position. People have even developed "shotgun rules" used to determine who gets to sit there. In my experience, however, this is usually unnecessary, because it is manifestly clear who should be in the front seat. Almost always, the driver's significant other gets the front seat, or failing that, whoever has the closest friendship with the driver. In uncertain situations other methods of determining priority may be used, but, like many complex social processes, the decision is usually made quickly and without much thought or deliberation. Calling "shotgun" in such a situation reveals immaturity or unfamiliarity with the social dynamic, and so it doesn't happen a whole lot.
Back seat (left or right). The back seat is less comfortable than up front. The amount of legroom you have is dependent on how far back the person in front of you has his chair pushed back. In some cars, your seat belts are lap belts instead of the safer shoulder belts.
If someone calls you a "back seat driver," you've exceeded your authority. The back seat isn't supposed to have much power or control. (There is no analogous idiom for "front seat driver.")
Back seat (middle). Also known as "bitch." By far the least comfortable place to be. You have very little personal space, since you're enclosed on both sides by other passengers. Your feet are on a raised hump of carpet that all cars seem to have for some reason, dramatically diminishing your legroom. Small people or children tend to get stuck here, because it can be downright painful for a big person to sit there.
On the other hand, if you're indifferent to the physical discomfort sitting in the middle entails, it can be a fun place to be. It's the most social place to sit, since you can comfortably talk to, and hear, everyone else in the car. Also, if you're sitting next to someone you like, people encroaching on your space suddenly seems less bothersome. And if you willingly offer to sit in the middle, your martyrdom can gain you a small amount of gratitude and respect from your fellow passengers, and they may do nice things for you.
These things generally apply to the whole back seat, to a lesser extent. It also brings to light some disadvantages of being in the front seat. If there's a conversation going on in the back you may be cut off from it, especially if the music or ambient noise from the car is loud. If the driving is difficult and the driver needs to concentrate hard, you can be left with no one to talk to. The front seat can be lonely. Also, people may resent you for taking the front seat, but let's hope your friends are too mature for that.
Being a passenger is also a state of mind. The fact that there are so many damn songs about it is a testament to this. You can go through life as a passenger, observing events but making no attempt to control them. If you do this it is important to cultivate the proper attitude; you must learn to like what happens to you. (This is what the movie Waking Life is all about.) If you can pull this off, being a passenger is a pleasant, blessed thing: you are freed from all responsibility, set to drift and observe beauty as it passes you, as you pass it. Most people, however, are too attached to the outcome of events, and can't resist grabbing the steering wheel now and then.