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Petrofraud and the New Depression

Michael Fox
email: TheCulturedEconomist@yahoo.com
June 30, 2008

Petrofraud is a word I coined to describe the the great con job that is the Bush administration’s policy – that policy is the only policy they have or have ever had, with respect to energy, foreign affairs, war and our economy. All of it has been about oil. And the present speculative bubble is the crowning achievement of the scheme.

They are laughing all the way to their banks in Dubai, Switzerland, and, no doubt, Paraguay. A superb assessment of the pathology of this sociopathic bunch can be found in Charley Reese’s chilling column, America is the Rogue Nation, which details the lengths to which they are going – in our name – to achieve their nefarious goals. We are being robbed into bankruptcy to enrich a relatively small oligarchy, within which an even smaller group are retaining unimaginable wealth.

Once these statements would have sounded outlandish; the ravings of an extremist. Now, however, we all know it to be true. Even those who still fancy themselves “conservative” know what’s happening, though many of them retain their allegiance to the Republicans as a form of faith.

What is it about faith that makes it so devastatingly ruinous? It is simply this: it is the belief in something or someone just because… Because one wants to believe it, or because one was raised to believe it (even if further education proved it wrong), or because one voted one way and doesn’t want or can’t process the idea that it was so dreadfully wrong. So they become more fiercely adamant in their wrong-headed convictions. But heads are coming out of the sand.

As the zeitgeist has shifted, thanks to the indefatigable efforts of Al Gore and countless others, the public has awakened to the need to reduce our energy usage and shift to renewable, non-polluting resources. Auto manufacturers have slammed shut whole plants and discontinued models of large trucks and SUVs as gasoline flirts with $5/gallon. The interesting part about $5/gallon gasoline is that it is the point at which people significantly change their habits; for some, it becomes their only non-sustaining expenditure (outside food, home, and utilities). The person who had only $200/month after basics can no longer buy clothes. Hell, they can barely afford to dry clean the ones they have. That extra $200/ month is going to fuel tank and increased home utilities bill. The oilmen in the West Wing are squeezing the last dime out of the public for their cronies in Houston. In a Depression, there’s no spare change.

Ironically, Bush’s legacy may well be that it was through his ill-gotten and mismanaged stewardship that the American public became serious about conservation and self-sustenance. The same could have been achieved by a president who understood the good that government can do (rather than how much he could steal from it) by placing high taxes on gasoline when it was still $1/gallon as Bush took office. Had a $4/gallon tax been levied at that time, the oil companies would have still been profitable, but the hundreds of billions of dollars they have raked in over the past 7 years would have been going to maintain a domestic infrastructure that is now the disgrace of the developed world. Had we been paying high prices for gasoline due to a tax, the change in the public mindset would have occurred just the same. That infrastructure improvement would have, included electric-charging, biofuel, and hydrogen stations, as well as modern rail service. The oil bubble could never have occurred, because by this time usage would be flat or reduced, and the meme about shortages wouldn’t have been applicable. Either way, the change in mindset has been achieved.

Every day, more gas-guzzling vehicles are retired and replaced by cars that get twice the mileage, airlines are cutting flights and cramming more passengers into fewer planes, and people are using their air-conditioners more judiciously. In the end, changing the driving habits of Americans will be spun as Bush’s greatest achievement. Of course it came as a way to benefit his cronies from Riyadh to Houston, but it there it is.

The major difference is in who’s angry. If a large tax had driven up the price, and in return for it the United States had initiated a massive infrastructure project – adding modern train lines, additional subway lines, and substitute fuels – the conservative anti-tax crowd would be furious. As it is, the only people who are happy are those getting larger dividend checks from their oils stocks, and those who have speculated successfully in oil futures, although I suspect most of them grouse at the pump just the same anyone else. My guess is that both of those investments have rather worn out their welcome.

Meanwhile, the infrastructure that wasn’t maintained with those same hundreds of billions of dollars has decayed. The other achievement from these policies will be losing the entire Mississippi River basin and all its tributaries for the Republicans: from the levees in New Orleans, to the Bridge in Minnesota, through the levees and farmland in Iowa, Missouri and Illinois, the breadbasket knows where the blame lays.

What to do Now
So it is incumbent upon all of us to further cut our consumption now, as one should during wartime anyway. The sacrifice of this war should be against those who are really waging it at our expense (the oil companies and crude speculators). Petrofraud has brought us here, and minimizing our use of what has become as basic as food will be our out. Ride share; plan your trip to minimize your mileage; retire your car and replace it with a more efficient model as soon as possible (and if you can select an American car with high mileage, you will be sending a vote to Detroit saying you want more of these models, and saving a domestic manufacturing job); and buy locally grown produce (this is a step that will improve your diet and save thousands of gallons of diesel).

As there’s no doubt that gasoline prices will plummet after Labor Day (banking on short memories in November): Don’t be fooled. It’s the end of the con.

Author’s note: This week I would like to given a special shout-out to Martha and Sylvia, who, while having been married for years in the eyes of our family and everyone they know, are now married in the eyes of the law. Brava, ladies! At last.


Michael Fox
email: TheCulturedEconomist@yahoo.com
June 30, 2008