Michael Ventura suggests America is like Wile E. Coyote — a few steps past the cliff, only we haven’t looked down yet. It’s a fascinating, if depressing column. His key point:
Gas prices can only go up. Oil production is at or near peak capacity. The U.S. must compete for oil with China, the fastest-growing colossus in history. But the U.S. also must borrow $2 billion a day to remain solvent, nearly half of that from China and her neighbors, while they supply most of our manufacturing (“Benson’s Economic and Market Trends,” quoted in Asia Times Online) — so we have no cards to play with China, even militarily. (You can’t war with the bankers who finance your army and the factories that supply your stores.) China now determines oil demand, and the U.S. has no long-term way to influence prices. That means $4 a gallon by next spring, and rising — $5, then $6, probably $10 by 2010 or thereabouts. Their economy can afford it; ours can’t. We may hobble along with more or less the same way of life for the next dollar or so of hikes, but at around $4 America changes. Drastically.
And it was $3.199 in Needles last week.
Thanks to dangerousmeta! for the link.
So we are sending all our dollars to China to buy the goods that we used to make here, but which mostly American companies figured out how to do in China much cheaper, and then borrowing the money back in order to grubstake a government which is mainly concerned with controlling the world?s oil reserves, of which China now seems to be the number one consumer.
I hope everyone here in the USA is considering having their sweeties learn to speak Mandarin.