|
|
A lot of people bitch these
days about high price of gasoline in United States. In this post, I
will show that in fact:
1. Gasoline is super cheap
in US
2. "Peak Oil" in
US happened because of "Peak Greed".
3. US consumer has lost his
priorities.
4. It's going to get worse.
1. Gas is still very cheap
in US. In fact, it has gotten cheaper than ever! This spring (2008), we pay
about 10 cents a gallon of unleaded, how can you call this expensive?
Gasoline was sold for 30 cents a gallon in 1920, and
it fell threefold during last 90 years.
Gas at $4 per gallon is
still only 1/225 of an ounce of gold at $900 per troy ounce ($900 / $4 =
225).This means that in pre - Roosevelt dollars ($20.67 = 1 troy ounce of
gold), which were ordained by the constitution for Americans to use, the gas
is about $0.092 per gallon ($20.67 / 225 = $0.092). Pre - Roosevelt
dollars? Yes, those are the dollars we are supposed to have, and not the FED
paper notes.(IF you are American and support the
Constitution, that is).
So, you see that the price
of gasoline is not high, but very low, three times lower than when Americans
first started to pay attention to it. You are getting paid in ever-depreciating
FRNotes, that is true, but then you should bitch
about FRNs and yourself not supporting the
Constitution, and not about the price of gas.
2. There was never a peak oil in US. Get over this propaganda. What had
happened was that many freedom-loving and independent Americans stopped being
Americans and started to look in other people pockets, and frequently helping
themselves into those pockets.
Particularly, they were attracted by the pockets of oil industry giants.
When US went bankrupt,
Nixon was printing FRNs like there was no tomorrow,
which is of course as you know pure inflation. But, in 1971, he was also
"fighting" inflation, by stealing money from real Americans who
were still capitalists. Population in general was happy, - those bad capitalists
should suffer! This was called wage and price controls, you see, Nixon was
pumping money, but didn't want any consequences, so he controlled the prices.
Producers could not raise their prices to compensate for ever cheapening FRNotes, and had to remove the product from distribution.
By 1973, as I've been told
by Dave Fairtex, these were lifted, except the ones
on oil, because oil companies were considered to be too rich for an American
company. This went on till 1980. Then it was windfall profit tax all the way
through 1988. So, you can see that from 1971 to 1988, for 17 years, the oil
industry was systematically robbed, for "the common good".
What did the oil industry
do? It did what any self-respecting capitalist would do, - moved out. Now
these companies are buying foreign crude and sell it to US refineries,
keeping the difference in off-shore jurisdictions. US has
left them no other way to keep their money. Essentially, they did the same honorable thing Founding Fathers did, except they didn't
take any land from abusive empire.
The oil production in US
peaked in 1970, and went down ever since. Why? The abusive taxation was
completely repealed in 1988? Sure, but would you go back to England after
you have made your home in US? Didn't think so. Similarly, the numbers of
free-from-empire oil companies just grew through "immigration" or
others, leaving the US
at a later time to join the off-shore freedom community.
This is why there is less
production in USA,
forget you peak-oil stories, those are for democrats and other idiots. Or
may-be they are right. I
guess one could argue
that the pilgrims left their lands bound for new world because of natural
peak of religious freedoms, and not because of horrible prosecution their
home countries imposed on them.
3. US consumer has lost his
priorities, which is just another reason why people say that oil or gasoline
is expensive. It is not by any means. Make this experiment: Add up your own
unnecessary expenses, such as cable tv, satellite,
paid radio, fitness clubs, dining out, gaming expenses, music downloads, pet
food and care, cigarettes, liquor, condoms, starbucks
coffee, designer clothes, bottled water, text messaging, and whatever else
you can remember. Now compare that with your monthly expenses on gasoline.
Gasoline is essential, it
gives us freedom of movement at less effort and higher speed, and it carries
our goods with us. Discretionary expenses above are joy of life, of course,
but they are completely unnecessary. People who have them and yet complain about
cost of gasoline are just lost their priorities or never had them. Those
things should only be bought when your income is high enough, but then the
gasoline wouldn't matter either.
This needs to be adjusted.
Important product such as gasoline needs to take it's
priority place well above all the fuzz that no one life depends on, and it
will take that place.
4. It's
going to get worse, a lot worse. Consider the movement to consume less gas,
for example. Right now, we are able to negotiate beneficiary pricing for
ourselves due to the volumes of crude we are buying. Let us say that we
manage to reduce our consumption in half, by driving funny European little
parodies on cars, tin cans with solar engines, trash-eaters and the like.
Since our volume of oil purchase will fall, so will our ability to negotiate
better pricing. So, picture your wife not in a safe Tahoe, but in a tinfoil
"green" parody vehicle. If she gets into accident, she will more
likely to be seriously harmed in that tinfoil car, than she ever was while
driving Tahoe or Crown Victoria.
But because we will buy less gas, you will likely continue to pay same prices
as you do pay now, plus the inflation! This is the way of a weak, and it will
not and should not result in a victorious outcome.
Congress is looking into
the rise of oil prices, and it can't see it's own
tracks, of course. It can't see the inflation they have unleashed in order to
save their well connected buddies in business and banking. What they see, is
same old thing every socialist sees, or prefers to "see", and that
is of course, the speculation. In a socialist's mind, the market is always
wrong, and needs to be regulated.
And regulated it will be.
Congress will adopt commodities speculation controls, and it will achieve two
things in doing so: It will make it harder for on-the-edge-of-bankruptcy
firms to stay afloat by replenishing their profits that they have lost on CDOs, and secondly, there will be a tendency created for
the speculators to move their activity off-shore, and so there will be a
capital outflow from US, resulting in capital controls and a complete halt of
economic activity in USA.
Beside these two short term
consequences, the long term one will be that necessary adjustments, that
speculatively bid up price of oil was designed to bring about, will not be
made. The country will instead slowly and powerlessly stagnate into a state
of energy impotency, where the prices of energy are not allowed to command an
increasing investment, since this will be banned by congress "for the
common good", and so, outdated and uncompetitive technology will not be
replaced, insuring the status quo for years to come. By status quo I mean, of
course, higher energy prices that anyone is ready to pay.
|
|
