America Motoring In direction of Economic Disaster
America has been motoring towards disaster ever since its financial system was structured around the automobile and low cost vitality provides.
Now that power is now not at all cheap disaster is imminent. Just like the airways, with oil above $125 a barrel, and possibly headed much increased as peak oil quickly kicks in with a vengeance, the American coal gasification power plant china business and life-style mannequin is broken
Gasoline costs at $4.00 a gallon have began to drive People to cut again on their driving. Even center class families are having a tough time making ends meet with rising gas prices, rising food costs, double digit increases in the price of well being care, stagnant incomes, and falling house prices occurring all at the same time. So some effort at energy conservation is finally underway.
Unfortunately, America and Americans have not but come to grips with the fact that massive adjustments in the best way that the everyday American lives are going to be compelled upon them. There isn’t one politician in sight who has the guts to tell People that a lot of them face a long run discount of their standard of living.
Driving a number of much less miles each week could assist some but it isn’t going to make a dent within the hard reality that the privileged position of The United States of America on the earth is in a state of transition. Things won’t ever be fairly the identical as Individuals will be compelled by financial occasions to regulate the wasteful life-style that they have come to know because the “American Method of Life”.
American politicians, like John McCain, boldly declare that “the American approach of life is non negotiable.” Nevertheless, they appear to miss the truth that the US is hopelessly dependent upon overseas oil for over 60% of its supplies.
The drain each day of America’s wealth to pay for oil imports at $125 plus barrel oil is lots of of hundreds of thousands a day. It’s not solely the outflow of cash that is the problem. It is usually the somewhat unfriendly nations that numerous those oil payment funds are being transferred to.
We are supplying plenty of nations which are outright hostile to the United States with enormous quantities of funds. This leaves the US extraordinarily uncovered to all types of potential challenges, including the financing of acts towards US interests utilizing what used to be our own money for the funding of hostile operations.
Right here is oil import knowledge from 2006 (latest obtainable) provided by the US Power Information Administration. I anticipate that the numbers are far worse for the US now. Actually at $125 a barrel oil the whole amount that we pay has gone through the roof.
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“The United States consumed 20.7 million barrels per day (MMbd) of petroleum products during 2006 making us the coal gasification power plant china world’s largest oil consumer. The United States was third in crude oil production at 5.1 MMbd. In addition to crude oil, vital contributions to U.S. petroleum equipment distributors petroleum provides came from pure gasoline plant liquids, refinery achieve, and alcohol fuels. Nevertheless, we still needed thirteen.7 MMbd of imported crude oil and petroleum products to fulfill U.S. demand. The United States also exported 1.3 MMbd of crude oil and petroleum products during 2006, so our internet imports (imports minus exports) equaled 12.Four MMbd.
Petroleum products imported by the United States during 2006 included gasoline, diesel fuel, heating oil, jet gasoline, chemical feedstocks, asphalt, and other products. Nonetheless, most petroleum products consumed in the United States had been refined right here. Web imports of petroleum other than crude oil had been 17% of the oil consumed within the United States throughout 2006.”
Let’s do the math utilizing the 2006 12.Four MMbd figure but at today’s prices. 12,four hundred,000 x $125 = $1,550,000,000 a day leaving the nation. How lengthy can this go on Not without end, of that I’m certain.
When you think about other outrageous costs, such because the 12 billion a month we are spending to combat the Iraq war, you can see that America is on its method to changing into a poor nation in a relatively huge hurry.
It’s time for Americas to wake up and put together themselves for a downsized future. The sooner that Individuals begin to wake up and demand that politicians communicate the truth about such issues the better off we will likely be. As soon as we admit that we have a problem we can get on with the task of finding ways to better deal with it.
Unfortunately, no American politician seems to have the guts to admit that America does not have a particular proper to dwell past our means eternally. For Individuals, and for citizens of different extremely developed nations, just like the UK and Spain, the day of reckoning is close at hand, prefer it or not.
Gerald “Taipan” Greene is a retired forex trader and portfolio manager who worked in Asia for over 20 years. The nickname was acquired in Hong Kong and is now used for a variety of monetary, political, and Internet business associated blogs. One in all them is at Daring Messenger