What if the price of oil goes down to $25 a barrel? Won't that bring down the costs of almost everything else? Oil prices are in the process of going down presumably because people all over the world have changed their driving habits and are driving much less. I don't think prices will go down as fast as they went up, but I would think that the natural competitive pressures of marketing would eventually bring down the price of all the things that became more expensive because of high distribution costs due to high oil prices.
Barack Obama has often said that prosperity starts at the bottom, a philosophy in direct opposition to the Republican philosophy that promotes the argument that stimulation of big business causes ‘all boats to rise', otherwise known as the trickle-down effect. There was a time when that philosophy seemed true. When a company opened in a town and did well, more people had jobs. Stable companies employed workers for their whole lives, and even for the lives of their children. But it took strong Unions to persuade companies to give certain benefits to the workers. In many cases the workers in return felt a sense of loyalty towards their employers.
In these days of globalized business, those conditions are long gone. Workers are in danger of losing their jobs at any time, and it is happening now. Workers nearing retirement are losing their pension funds as well as their 401Ks as the economy falls. I don't see that tax breaks given to globalized American businesses is necessarily going to benefit American workers. Their benefits may just be absorbed by the companies, or trickle down to workers in China or India or to whatever country the businesses have moved their operations.
Another thing I see as a fallacy is that taxing globalized business will undermine their prosperity. People who should know say a lot of companies find enough loopholes in the tax system that they don't even pay any taxes at all if they have moved their nominal headquarters to islands in the Caribbean. If Obama is elected he says he will close those loopholes and cut any tax breaks for companies who ship their offices and jobs overseas. Sounds like elementary common sense to me. The money made on that deal might go a long way toward balancing the budget or paying for some of the vital needs of America that have been neglected for the last eight years.
Another idea that has been forming in my mind is that beyond getting out of Iraq as soon as we can without leaving utter chaos behind, is that we need to do something other than to continue the war in Afghanistan. I don't know of any outside force that has ever compelled Afghanistan to do anything that her warlords didn't want to happen for very long. I guess I should have taken time to dig into the history of the area before I make such a statement, but we know the USSR couldn't do it. It was their Vietnam. Afghanis have always been known as a fiercely independent people and also fierce warriors. Maybe we could prevail if we bombed the mountains down to nubs, but do we really want to do that? We are already killing a lot of civilians by aerial attacks, and that undermines any good will generated by purposeful kindness shown to the Afghani people by American troops. I think war in Afghanistan is a no-win proposition. Today on Meet the Press I heard General Colin Powell say the same thing.
One thing that should be done before we pull out of the war area, is capture or kill Osama bin Ladin, but since he seems to be sheltered on the Pakistani side of the mountains, that can be a prickly and dangerous business. Since Pakistan has such an unstable government and also has possession of nuclear bombs, a lot of diplomacy must be undertaken before we blunder into an even worse war. I wonder if it is possible that Afghanistan and Pakistan would agree to give him up in exchange for our departure?
What I do know is that for America to pull out of this economic disaster, we have to stop pouring borrowed money into foreign wars and other bottomless pits. And getting back to my original topic, we have to become energy independent and stop pouring borrowed money into the coffers of foreign oil producers most of whom hate us. We need to be steadfast in demanding alternative energy from sources within our own country even if it causes the price of energy to remain high for a period of time. Market pressures will surely even things out in time.
I would appreciate any of your ideas on these subjects.
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Comments: 18
I agree with you on Afghanistan and I don't know all the history either. It will be unpopular to say, but I remember years back when politicians warned us that we cannot be "the policeman of the world." I do not that Russia is not the only country to have flopped in Afghanistan. We might not doing any better. We do need to stop spending 10 billion a month on war.
Oil is a mystery to me too - easy to say supply and demand but that is just part of it. Do think OPEC will reduce supply so it does not go too low to suit them.
An excellent article. I concur with your thinking. In a global economy the only thing we have power over and are able to control is our own spending habits. That is the reason for fear in the rest of the world - they depended on American consumption to keep the economy moving.
I think America needs to innovate their way out of this crisis -
1. Green Energy - this we all recognise affects all aspects of our economy and prices at the grocery stores to fueling our transportation needs.
2. Be more of an Inteernet economy - encourage work from home using teleconference and vide conference - Internet needs to be made very cheap.
3. Stop being the world's police force.
4. Consumption taxes - this may be an up popular idea but we need to consider country-of-origin VAT taxes (such as they have in EU). The reason we need country of origing taxes is we can impose stiffer penalties on countries that abuse chils safety laws and other labor laws. Dumping of goods etc,
5. Greatly improve our education system
Being new to the internet and with out television or even radio for over three decades my source of global economic and environmental awareness has come by reading lots and conversations with other isolated neighbors. Surprisingly, we've kept quite current.
I come from an area that many see as "third world" like. People in many of the countries where my adventurous children have taken themselves, (traveling on a dime, reminiscent of old steam tramper travel) have few possessions but comfortably share their belongings.
The modern world has gotten dependent on having so much. We feel entitled and then deprived when we aren't able to have it all.
I think our days ahead are going to be hard as we are pressed into changing our values. But we're a resilient society and an adaptive species. Is compassion an adaptive strategy?
So glad to read your well informed and brightly written piece. May your physical form keep up with your intellect. Thanks for your thoughts and a stable lead into dicy territory.
This is not like Japanese AM radios, where labor and wages eventually equalized. This is instead about transportation for goods, as well as people. If China, and other countries, foolishly build a car culture similar to ours, they will be just as gridlocked as we are becoming.
Everything rides on innovation in transportation.
It's a race.
What we have to do is to break the strangle-hold that Big Oil has on our political system so that we can give some meaningful encouragement to alternate, renewable sources.
Obama is in favor of this. McCain is not. Just one more reason for an Obama vote.
Barack Obama has often said that prosperity starts at the bottom, a philosophy in direct opposition to the Republican philosophy that promotes the argument that stimulation of big business causes ‘all boats to rise', otherwise known as the trickle-down effect
Salud