Cash drains hitting the USA... Car-dependency, etc. (Washington, largest, electric)
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Simple. Because it's not a concern. World trade is a great generator of wealth and oil is just another product. I'm no more worried about trading for oil than I am trading for electronics, cars, clothes, furniture, food, or any other product.
Oil dependency isn't an American concern as much as a global one. America is in a much better position than most of the world to weather that storm. Rising oil prices will predominantly affect food prices, crippling the developing world despite the fact they consume very little oil. Look at the Arab Spring which, in part, was caused by food prices caused by the rising price of oil. Americans grumbled, drove a few thousand miles less, and bought cars that got a few more mpg. We're an affluent nation with abundant natural resources. Rising energy prices aren't that scary for us. We're a net exporter of energy as it is and that's only accelerating, so higher prices just means more dollars coming into the country. Additionally, being an affluent country we're more easily able to afford higher energy prices with a few small sacrifices like trading in the Explorer for a Fusion or Escape, turning the thermostat up a few degrees in the summer or down a few in the winter. Not a big deal.
Along with the telephone, the personal computer and the privately held firearm, the private vehicle is one of the four devices which have kept Big Brother and Big Sister from getting too big. That's precisely why the so-called "progressives" -- the little fellows and little girls with big plans and big egos, are so resentful of it.
They promise blue skies -- but what actually emerges is the gray world of socialized Europe. And let's not forget that that supposedly "enlightened" system delivered some very dirty laundry between 1914 and 1945.
We'll pass, thanks; just don't come around seeking to tamper with our lives and lawful property, and we won't interfere with your delusions which, without access to the state's power to coerce, are self-limiting.
The automobile caused a large increase in government. When we just had horses and buggies the roads did not have to be built for speed. Just two lane blacktops were ok for the Model T, but with higher speeds an interstate highway system was built. As far as the computer, remember it was a government program that led to the existence of the internet, though Al Gore may not take full credit. Don't know about the telephone but the first telegraph line was subsidized by the government.
Last edited by pvande55; 02-24-2013 at 06:34 PM..
Reason: Add clarification
Simple. Because it's not a concern. World trade is a great generator of wealth and oil is just another product. I'm no more worried about trading for oil than I am trading for electronics, cars, clothes, furniture, food, or any other product.
Oil dependency isn't an American concern as much as a global one. America is in a much better position than most of the world to weather that storm. Rising oil prices will predominantly affect food prices, crippling the developing world despite the fact they consume very little oil. Look at the Arab Spring which, in part, was caused by food prices caused by the rising price of oil. Americans grumbled, drove a few thousand miles less, and bought cars that got a few more mpg. We're an affluent nation with abundant natural resources. Rising energy prices aren't that scary for us. We're a net exporter of energy as it is and that's only accelerating, so higher prices just means more dollars coming into the country. Additionally, being an affluent country we're more easily able to afford higher energy prices with a few small sacrifices like trading in the Explorer for a Fusion or Escape, turning the thermostat up a few degrees in the summer or down a few in the winter. Not a big deal.
You are so, so wrong.
What do you think is happening to the wealth that is pouring out of your country:
Can you not see how the US is slipping towards third world status, and how that will accelerate when the dollar crashes, and foreigners stop taking US fiat currency in payment for oil, etc?
"Oil is just another product"?
Fine. The fact that the cars that everyone uses everyday are dependent on it, hardly matters, right? When the oil price doubles to $8, and then doubles again, you can just go out and buy another transportation solution, Right? And the money to pay for it will be zipped into your bank account by a generous Fed, Right?
I could get used to the cars, but I don't think I could figure out the three shells.
Nybbler those high tech cars are a fantasy - they are not going to solve America's oil addiction, and transport problems. They are as ridiculous as the Segway is.
Published on Jul 14, 2012 Author and social critic James Howard Kunstler has been one of the earliest, most direct, and most articulate voices to warn of the consequences -- economic and otherwise -- of modern society's profligate wasting of the resources that underlie its growth.
In his new book Too Much Magic, Jim attacks the wishful thinking dominant today that with a little more growth, a little more energy, a little more technology -- a little more magic -- we'll somehow sail past our current tribulations without having to change our behavior.
Such self-delusion is particularly dangerous because it is preventing us from taking intelligent, constructive action at the national level when the clock is fast ticking out of our favor. In fact, Jim claims we are past the state where solutions are possible - instead, we need a response plan to help us best brace for the impact of the coming consequences. And we need it fast.
Last edited by nei; 02-24-2013 at 07:34 PM..
Reason: trolling
Can you not see how the US is slipping towards third world status, and how that will accelerate when the dollar crashes, and foreigners stop taking US fiat currency in payment for oil, etc?
Look, this isn't an economics forum, but you're missing an essential point about the trade deficit and currency exchange rates, which is that there's a feedback loop. If the US has a negative balance of trade, then dollars accumulate in foreign hands. That should push the value of the dollar vis-a-vis foreign currency down. That means that foreign goods will end up costing Americans more, and conversely American goods end up costing foreigners less. This would result, by simple Econ 101, in greater purchases of American goods by foreigners and tend to push the balance of trade back towards neutral.
So why hasn't this happened? A number of reasons. That many oil exporting countries accept US dollars is certainly a large part of it, but recently there's been a bigger reason, and that is monetary policy... Chinese economic policy. This completely explains the curve since 1993 or so. By artificially keeping the yuan low with respect to the dollar, China keeps Chinese exports cheap, and hence the dollars flowing in. China could of course stop doing this, but it would hurt China a lot more than it would hurt the US. The US would see a bad bout of consumer inflation, but it would also find domestic manufacturing becoming more profitable. China, on the other hand, would see its manufacturing economy -- almost entirely built on the cheap yuan -- collapse.
Well, I would say the opposite:
"The suburban, car-dependent sentiment is basically like a religion."
One that is toxic for those who have it, and also for those who don't have it:
As THEY burn through a limited resource, and channel US wealth offshore, they maintain a sense of superiority, while living in denial.
Please answer my repeated questions:
1/ What do you think gives America the right, with only 5% of the World's population to use 20-25% of the world's annual oil production?
(this seems like a moral question at first, but it becomes an economic question, when you look at it more deeply.)
Obviously, this outsize spending was permitted in the past because of America's status as the world's largest economy. But now the country is losing its relative wealth position fast, as BRICS and other countries catch up, adding new drivers in those countries fast. (China now sells more new cars per annum to its population than the US does.) So the US is able to sustain its outsized spending on oil, not though exports, but by printing money and spending its fiat currency on imported oil. Further, the credibility of its currency is partly engineered by the US maintain a massive global military presence - which is another very expensive proposition, that the country can no longer afford.
2/
Next question: Do you think it is sustainable for the US to be so massively dependent on imported oil (7-8 mn bpd), when it has a huge balance of payments deficit, and foreigners are beginning to lose their "appetite" for US debt?
An important thing that drove the figure so negative was the rising cost of oil,
and also rising foreign military costs
3/ If the US is likely to be faced with a big future jump in Dollar oil prices, does it not make sense to beginning addressing the unsustainable addiction to oil now, while the currency still has some spending power?
4/ If the country's leadership has failed to address the oil imports issue, is it not essential for individuals, who do not want to wake up to an oil price shock, to address it themselves, by downsizing their car dependency, and maybe living somewhere that they do not require a car in sustain their day-to-day lives?
From those who are car-dependent, I would really like to have an answer to these questions, which I believe to be fundamental and pressing. If you have no answer, then I think you are sleep-walking towards the precipice.
1) We have the right to consume this oil because we purchased it using a currency that the seller was willing to accept. If we were to end our fiat currency and return to a gold standard than the price of oil in $ would probably go down because the $ would have more value.
2) The trade deficit is not only sustainable in the short term, but natural. As we import more, the $ becomes worth less and so imported goods become more expensive/ exported goods become relatively cheaper. So the balance of trade in the long term is self correcting. You can see this in your graph, the account balance was beginning to rise. In 2011 it had risen to -3.2%. China on the other hand has decreased from 9.3% to 2.8% in 3 years.
3) If the dollar were to collapse and lose most of its value, oil would be only one of the many things that would increase in price. The most serious is the rise of food prices, which Argentina is dealing with now.
4) Most individuals do not see an oil price shock in the near future. New oil reserves have been found and US/Canadian exports of oil have been increasing, protecting us from oil embargo's. The demand for oil has also been decreasing as Americans are driving more fuel efficient cars. A decline in the value of the dollar will not make urban areas cheaper. The cost of living will increase there as well. Mass transit prices will increase, and the already high housing prices will increase. I don't agree with the assumption that urban areas will become comparatively cheaper.
This is a loaded question. US Treasury yields remain at historically low levels, which indicates that demand for US debt is high. (During the crisis, debt was being sold at zero yield, and even at negative yield on secondary markets)
Why is "demand high"?
Because the Fed is printing the money, and buying the bonds.
That's sustainable, isn't it? Isn't it? Dah!
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
