America Motoring In direction of Economic Catastrophe
America has been motoring towards disaster ever since its financial system was structured around the vehicle and low-cost power supplies.
Now that power is now not in any respect low-cost catastrophe is imminent. Like the airways, with oil above $125 a barrel, and possibly headed much greater as peak oil quickly kicks in with a vengeance, the American enterprise and lifestyle model is broken
Gasoline prices at $4.00 a gallon have began to power People to cut again on their driving. Even middle class households are having a troublesome time making ends meet with rising fuel prices, rising food prices, double digit increases in the price of health care, stagnant incomes, and falling house prices occurring all at the same time. So some effort at energy conservation is lastly underway.
Sadly, America and Individuals have not yet come to grips with the fact that large changes in the way that the everyday American lives are going to be pressured upon them. There isn’t one politician in sight who has the guts to tell Americans that lots of them face a long term discount in their commonplace of living.
Driving a few less miles every week could assist some but it isn’t going to make a dent why natural gas better than coal in the hard reality that the privileged position of The United States of America on the earth is in a state of transition. Issues won’t ever be fairly the identical as Individuals shall be pressured by financial events to regulate the wasteful lifestyle that they have come to know as the “American Means of Life”.
American politicians, like John McCain, boldly declare that “the American means of life is non negotiable.” Nevertheless, they seem to overlook the fact that the US is hopelessly dependent upon international oil for over 60% of its supplies.
The drain day by day of America’s wealth to pay for oil imports at $125 plus barrel oil is a whole lot of thousands and thousands a day. It’s not solely the outflow of money that’s the problem. It is also the fairly unfriendly nations that loads of these oil cost funds are being transferred to.
We’re supplying a lot of nations which are outright hostile to the United States with large quantities of funds. This leaves why natural gas better than coal the US extraordinarily exposed to all types of potential challenges, together with the financing of acts towards US interests using what was once our personal money for the funding of hostile operations.
Right here is oil import why natural gas better than coal knowledge from 2006 (latest accessible) equipped by the US Vitality Info Administration. I count on that the numbers are far worse for the US now. Actually at $125 a barrel oil the overall amount that we pay has gone by means of the roof.
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“The United States consumed 20.7 million barrels per day (MMbd) of petroleum merchandise during 2006 making us the world’s largest oil client. Coal Liquefaction Equipment The United States was third in crude oil manufacturing at 5.1 MMbd. Along with crude oil, vital contributions to U.S. petroleum supplies got here from natural gasoline plant liquids, refinery achieve, and alcohol fuels. Nonetheless, we nonetheless wanted 13.7 MMbd of imported crude oil and petroleum products to satisfy U.S. demand. The United States additionally exported 1.Three 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 gasoline, heating oil, jet fuel, chemical feedstocks, asphalt, and other merchandise. Still, most petroleum merchandise consumed in the United States had been refined right here. Web imports of petroleum aside from crude oil were 17% of the oil consumed within the United States throughout 2006.”
Let’s do the math utilizing the 2006 12.4 MMbd determine however 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 eternally, of that I’m positive.
When you think about other outrageous costs, such because the 12 billion a month we are spending to struggle the Iraq conflict, you may see that America is on its option to turning into a poor nation in a relatively large hurry.
It’s time for Americas to get up and prepare themselves for a downsized future. The sooner that Americans start to get up and demand that politicians converse the reality about such points the higher off we will probably be. Once we admit that we have an issue we can get on with the duty of discovering methods to raised deal with it.
Sadly, no American politician appears to have the guts to admit that America does not have a particular right to dwell past our means forever. For People, and for citizens of different extremely developed nations, just like the UK and Spain, the day of reckoning is shut at hand, prefer it or not.
Gerald “Taipan” Greene is a retired forex trader and portfolio manager who labored in Asia for over 20 years. The nickname was acquired in Hong Kong and is now used for various financial, political, and Web enterprise associated blogs. One in every of them is at Daring Messenger