Friday, February 25, 2011

As a Nation, We Remain Asleep at the Wheel

I'm afraid circumstances beyond our control are going to force lifestyle changes on Americans whether they like it or not. Yeah, sure, GM's profits are soaring. ("The $4.7 billion it earned for all of last year was its biggest profit in more than a decade.") Or they were, kinda, last year, but now with all that stuff going on that's beyond our control, the price of GM stock is trading at below what it was when it went back on the market in November.

And what is all that stuff beyond our control? Oh, a little acting out here and there in North Africa and the Middle East, people rising up regionally and challenging the thugs who have run their nations -- often with the tacit if not explicit support of the United States -- for decades. And these uprisings do not appear to be religious in nature -- they are economic and political, started by people with access to the Internet and who know that better lives are to be had.

These rebellions are happening in places like Tunisia, Libya, Bahrain, and Egypt, countries that are not so important for the oil that they contribute to American driving habits. Stability in the region, however, is highly desired for access to countries nearby that have more oil -- like Saudi Arabia and the oil that it gives to tankers that pass through the Suez Canal, controlled by Egypt. As unhappy people rise up and throw of the brutal dictators that have ruled their countries for decades, the price of oil globally is going up. A coincidence? A response to concerns about stability in the region? Or speculators taking advantage of the concerns about stability to drive up prices?

Matt Taibbi of Rolling Stone has done an excellent job (at least for me) of explaining the financial crisis that hit in 2008 and which still lingers (I am unemployed) in his book Griftopia. In this book he explains the mortgage crisis and how a few individuals and several large institutions (mainly Goldman Sachs) gamed the financial system to create the crisis. He also explains how gasoline prices were driven up by gaming the system. Could be that the same thing is happening now -- that we are all being gamed.

But I don't know. I do know that I support high gasoline prices, VERY high -- but I think they should be made high gradually and methodically and through TAXES that are reinvested in building out our public transportation and creating communities where people can walk, ride bicycles, or take buses to work and school and to run errands. And I think they should be percentage based, per dollar of gasoline sold. They would work like this: in the first year, the tax might be 5 percent per dollar of gasoline sold (not per gallon), but by the end of ten years, the percentage per dollar of gasoline would be 35 percent per dollar sold. Or something like that. (The reason we should not impose taxes per gallon sold is because cars are being manufactured to be more fuel efficient -- which is good, but fuel efficiency does not address all the other problems that come with car-based lifestyles such as habitat destruction and obesity.)

President Barack Obama, however, has sent out the word: no increase in the current federal gasoline tax, set since 1993 at 18.4 cents per gallon. Meantime, he's working hard on leaving a legacy of high speed rail. Republican governors are making a show of rejecting federal funds for HSR projects in their states, sometimes arguing they are doing so because the funding is contingent upon that states filling some of the funding gaps.

Obama could be leaving another legacy as well, however, one that I find alarming: a continuation of the policies of the administration of George W. Bush to open up more of the nation to mining and drilling for natural gas. While running for president in 2008, he campaigned in part on a platform of 'clean coal' -- if there is such a thing. And on November 4, 2010 -- the day after he got what he called a 'shellacking' from the electorate when they returned the House of Representatives to the Republicans, he gave a speech in which he said, "We've got terrific natural gas resources in this country. Are we doing everything we can to develop those?" And "There's a lot of agreement around the need to make sure that electric cars are developed here in the United States, that we don't fall behind other countries." (The U.S. Energy Information Agency has determined that in 2009 Americans consumed 22,839,158 cubic feet of natural gas, with 29,150 for vehicle fuel and 6,872.049 to generate electric power.)

Indeed, the natural gas of which he speaks – and which could be used to fire up the power plants that will generate the electricity for those electric cars – is locked in rock and released from that rock in a controversial drilling process called ‘fracking.’ According to the March 30, 2010 Scientific American, there is an estimated proved reserve of 6.7 trillion cubic feet meters of natural gas in the United States. But the same article discusses leaks and water poisonings associated with the process.

Obama and other elected officials are merely caught between the unrealistic desires of the American people (wanting a good quality of life without wanting to pay the price in taxes that that quality demands) and reality: limited natural resources in places that are generally hostile to the United States and environmental degradation because people want those resources. Personally, I think some form of democratic socialism is the only answer in a world of limited resources and too many people. At the very least, a few things should be socialized (or communally owned and operated, for those of you who object to the word socialism): water, transportation, parks, health care, electricity, education. I'm not saying that private enterprise in this sectors should be eliminated (well, re. water and parks it should be), just that private enterprise should not be the only option.