Last night the writer came across some interesting figures on the inexorable climb in gasoline prices. What I read is interesting, but mostly ignored data about the costs to our economy due to high oil prices.
The high costs of oil is dragging down the US economy to the tune of 3% of gross national product , money that goes to the oil companies and the middle east that formerly fueled jobs and domestic spending. Money used to continue the war is no longer easily provided without the risk of driving massive inflation. If there was no other reason to end the war, it is that it has weakened this countries ability to defend itself.
Pouring any more money into the economy will further weaken the dollar and contribute to inflation. Inflation itself is a terrible price to pay for the war, the oil we buy, and the goods we have been buying from china. These goods have been paid with IOU's, giving China great power over the U.S. and other major countries as well.
There is a knee jerk reaction to blame high prices on greedy oil companies. While it's true they are in a favored position to reap the rewards of high oil prices, they do not cause them, nor are they spending much on exploration with the generous tax benefit provided by the government.
Did the car manufacturers contribute to the problem by making too many gas guzzlers? A free market responds to consumer demand. The drivers in this country are driven by other factors than economy of size or amount of fuel consumed. A car must have sex appeal and Pizazz. It must advertise that the driver within is in control, well off, and with the ability to drive others off the road, if necessary. Women no longer want a pink station wagon. So the car companies respond to what the consumer wants without concern for carbon emissions or gas consumption.
Fuel cost is driving the SUV and full size pickup off the road. Even before this happened, there were warnings that gasoline was headed for much higher prices. But this had happened before and OPEC gave in or increased oil production to keep up with demand.
Now there is demand from other emerging markets, such as India and China. These countries have an emerging middle class and an economy that includes a car any worker can afford. The result of this demand is to drive cost of gasoline to new heights.
Many exploration companies report that OPEC has much less oil than formerly believed. This means it cannot produce any more oil than it is producing right now. Since there have been no major oil finds on the scale of the North Sea discovery, there is some speculation that "easy, sweet crude" is heading for extinction. This means what's left is harder to get to and requires more energy to refine than before, driving costs considerably.
The government has been hostile toward green initiatives, failing to recognize even that global warming exists, until recently. Other countries are preparing for the day that oil runs dry. Brazil, for example, is not now dependent on oil at all and is an exporter of the ample quantity of oil in their possession. Germany is well on the way to self-sufficiency, utilizing solar and wind, and collecting power from the sun on its autobahn.
America is a rich and resourceful country and never let the government stand in their way when it comes to a new idea, product, or service. Several solar companies are pushing the technology to greater harvesting of the Sun's great energy. They operate like utility companies by installing and maintaining solar panels for about the same cost of electricity. what's different is the consumer is paid off by the utility company for excess energy generated.
New wind farms are going up everywhere. The electricity they generate will be used to fuel plug-in electric cars and scooters that are already in production. New, long life batteries are making the electric car dream happen. These cars are sleek, quick, and silent. They will soon allow the driver over 300 miles of driving before a charge.
Meanwhile, keep the old guzzler tuned, drive like your foot has an egg under it, maintain the tire pressure, and get those heavy weights out of the trunk. Even clean oil contributes to better mileage. Keep your air cleaner clean and a heavy foot off the gas and you will see an increase in gas mileage. Meanwhile, the next 5-10 years may see some marvelous developments that wean us away from high priced gasoline and heating oil. We may return once agian to a time of choice, rather than dependent on the whims of hostile politics to keep our cars running.
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