look for something to happen whit oil this week????

Email Print posted by Bungle 06/08/2008 01:07:29 AM EST

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G-8 energy chiefs meet amid doubts about efforts to stop oil prices from surging higher.

Japan's energy chief launched a meeting of ministers from the world's top industrialized nations Sunday by warning that soaring oil prices could trigger a global recession if they're not checked..

uh you think....

Five top energy consumers -- the United States, China, Japan, South Korea and India -- urged oil producers on Saturday to boost output to meet growing demand, while pledging to develop clean energy alternatives and increase efficiency

It was unclear, however, what impact consumers will have without action by producers. The current president of the Organization of Petroleum Exporting Countries, Chakib Khelil, has said that the cartel will make no new decision on production levels until its Sept. 9 meeting in Vienna.

you have got to be kidding me sept.9..you we think have a large enough hores supply......

The United States, which has its own energy subsidies, urged countries such as China to lower its oil supports, which enable domestic consumers to enjoy cheaper gasoline. Subsidies shield consumers from higher prices, meaning consumption does not decline despite rising expenses.

we demaned you rape you society the same way we do..


India is already facing such effects. The government on Wednesday hiked gasoline and diesel prices, triggering protests by angry consumers who blocked rail tracks and roads and shut down businesses..

< Out of the mouths of babes | Bill Moyers at the 2008 NCMR >

Poll

Subsidies shield consumers from higher prices??
yes.. 40%
no.. 60%

Votes: 10
Results | Other Polls
 Display:
look for something to happen whit oil this week???? | 42 comments (42 topical, 0 hidden)
subsidies don't necessarily work with energy (none / 0)
If you look at the energy industry in america for example, the subsidies are supposed to relieve pressure on the consumer, but the consumer does not change the habits, so demand continually increases rather than decreasing...so with the demand staying the same, or increasing, the price will also increase...the subsidies need consumer aide to work in the us, as the demand in an energy giant is not subject to the same effects of subsidies as a smaller country like France.  the oil companies here have recieved large subsidies, yet continue to raise prices because demand keeps on truckin...

by chrisandyasemin on 06/08/2008 11:06:38 AM EST

Reality check (none / 0)
Oil subsidies are needed in countries like China and India, these economies cannot support the prices that Americans or Europeans pay for gasoline. That being said, as prices do not go up in those countries the government spends more and more money on subsidies and less on social programs, or goes into deficit and debt. At some point the governments may have to ease the subsidies due to the enormous costs involved. In the US subsidies instead of going to consumers goes to oil companies to "raise production", but the reality was that the US government gave them massive tax cuts (a form of subsidy) and actual subsidies in the late 1990s when oil prices were at all time lows, due to the fact that Bush and his administration is captured by oil interests.

The rise in prices has little to do with actual conditions today, speculators are the ones who are pushing up the price to these elevated levels. Supply and demand are not out of whack, US consumption is going down. The only way the oil majors can make any profit now is by increasing the price faster than consumption goes down, and faster than their declining or stagnating production. People have to understand that any corporation are businesses, not industrial enterprises; they are in it for profit not for efficiency.

Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/08/2008 01:08:16 PM EST

the energy secretary disagrees (none / 0)
"The rise in prices has little to do with actual conditions today, speculators are the ones who are pushing up the price to these elevated levels. Supply and demand are not out of whack, US consumption is going down. "

Here is what he has to say about the situation:


"Samuel Bodman, attending two days of meetings in northern Japan among energy chiefs from Group of Eight industrialized countries and other top economies, said the surge in world oil prices was largely a simple problem of supply and demand.

Production has stalled since 2005 at 85 million barrels a day, while economic growth — particularly in China and India — has pushed demand ever higher, Bodman said before a meeting of ministers from the U.S., Japan, South Korea, India and China.


"We're in a difficult position where we have a lid on production and we have increasing demand in the world," he told a small group of reporters, dismissing the effects of speculation and unclear inventory levels and other factors on oil prices."

http://abcnews.go.com/Busin ess/wireStory?id=5019699

Then again I know none of this means anything to you because supply and demand don't exist and econmics is simply an illusion created by rich white men to repress and enslave the proletariat. 

by alphasigmookie on 06/08/2008 03:02:22 PM EST

[ Parent ]
Wow.. (none / 0)
Who is the foolish one here? The one who believes the crap that spews from the BUSH ADMINISTARTION on affairs concerning energy? Or actual research? Lets see, according to the EIA:

European oil consumption in 2006 was 16.4 million bbl/day, in 2007 it declined to approx. 14.6 million, a net decline of 1.84 million bbl/day. Add with that a decline in Japan's consumption over the time period of 187,000 bb/day, you see a decline of 2 million bbl/day.
 
China+India+US+Russia saw a combined increase in oil consumption btwn 2006 and 2007 of  541,000 bb/day.

So take your BULL SHIT, and your LIES and stick them up Bush's ass!



Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/08/2008 05:59:34 PM EST

[ Parent ]
These high energy prices (none / 0)
are a killer, but I am in favor of them. It is the only way to produce an incentive to GET THE HELL OFF FOSSIL FUELS once and for all. Or short of that, at least become energy self sufficient. If Brazil can do it the US should be able to also. Up till now, everything we do in this area is a scam to make the rich richer, i.e. the corn ethanol joke.  

by mijoh on 06/08/2008 03:08:32 PM EST

I'm with mijoh (none / 0)

by desertpear on 06/08/2008 04:44:22 PM EST

[ Parent ]
Brazil... (none / 0)
I've been to Brazil, its a different country entirely from the US. First off, it has HUGE expanses of land that can be cultivated and not effect food production, secondly the ethanol created in Brazil is based on highly productive sugar-cane, the US produces corn which is much less effective. The US cannot pull off a Brazil without sacrificing massive tracts of land that otherwise would have fed you or me.

Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/08/2008 06:04:14 PM EST

[ Parent ]
Plus (none / 0)

Brazilian girls are smoking hot. Even when they are not that hot they are still incredibly hot. It's like this magic aura they have and know how to work it.

Now that's energy production. 

by z1p101 on 06/08/2008 06:31:59 PM EST

[ Parent ]
Don't worry (none / 0)

Ken, our resident oil expert assures us all that this is a temporary bubble and oil will be back to $20 a barrel any day now.

I hope he is not investing his hard earned dollars in this idea because this will be his future. 

Ken's future 

by z1p101 on 06/08/2008 06:37:30 PM EST

Oil Bubble (none / 0)
What do I know about the oil business? More than zippy. I grew up going from rig to rig with my Dad, who was an engineer in the oil patch, when I was a kid. My first job out of college was automating refineries and pipelines. Every job since then was related to petroleum feedstocks and energy. I have three wells producing right now, and times are good.

We’ve seen plenty of examples of market bubbles before. Real Estate Bubble. Dot Com Bubble. Nasdaq Bubble. Tulip Bulb Bubble. Oil Bubble.

Market bubbles exhibit similar characteristics. Speculators become convinced there will be more demand than supply for the foreseeable future, maybe forever. Look at what happened to the price at the pump in 1981. Then look what happened in 1983. It takes a couple of years for the market to correct, but the correction will come.
bubble 
Remember when you tried to find your car in the parking lot, and you couldn’t see it between the dozens of SUVs that were hiding your poor little car? Then you started wondering why the hell all of these people need an SUV. Are they all off-roading and mudding on the weekends? Do they all have families with 10 kids? Do they all take frequent trips to Home Depot to pick up building supplies for major construction projects?

No. It’s called conspicuous consumption. It used to be cool to drive an SUV. You didn’t want other drivers riding higher than you. You didn’t want to have a collision with a monster SUV when you were driving a two door coupe. That thinking made sense when gas was $1.50 per gallon.

But just like 1981, people are trading in their land yachts for high gas mileage vehicles. GM finally got religion, and they’re dumping the Hummer.

So demand is shrinking. But at the same time, supply is increasing. The rig count is increasing even faster than the price of oil. At some point, the supply curve always crosses the demand curve, and the price will drop like a rock.

rig count 

by KenTX on 06/08/2008 10:35:09 PM EST

[ Parent ]
Not so fast... (none / 0)
There is kink in the analysis, firstly oil consumption is way down already in the OECD countries, according to the EIA:

Oil conusmption (BBL/DAY):

2006:49,336.47
2007:48,961.96
Net:-374.51

Yet prices btwn 2006 and today are up by 100s of percent, the increase in China's and India's demand is not as significant as they make it out to be. KenTX is actually right that in terms of fundamentals there is no reason for oil prices to be this high. The reasons, and they usually almost always are, for the steep price appreciation has nothing to do with fundamentals. The reason why oil is so high is because:

a) Oil majors have no other way to make profit, so they collude to push up prices
b) Oil majors hoping to push public opinion in favour of more drilling, the only way to do this is to push the price so high that the public will have no option but to accede.
c) We must not forget that the managers of these massive corporations are making a killing themselves by pumping up the value of the stocks (of which they own) of their companies over their effective capitalization, thus selling the stock when it reaches its height and not only doing damage to the overall economy, but the corporation itself (note how prominent owners of Exxon want to change the business model, but the top brass do not), these owners constitute a SUPER class of wealth that Veblen calls the "captains of industry".
d) Speculators (institutional investors) due to low interest rates have lots of money to invest, and since all other forms of investment: dot.com, housing, have collapsed the only one that is left is resources

So not its this supply-demand crap they tell you, thats an abstraction, a mystification as Marx would call it. Its used to confuse you and to HIDE the actual operations of the market...the capitalist system exists for profit PURE AND SIMPLE, nothing more, nothing less...not industrial efficiency or societal well-being, as Americans are finding out now.

Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/09/2008 12:17:24 AM EST

[ Parent ]
Can only consume what's avaliable (none / 0)
People can only use the oil that exists on the market.  If you compare your numbers with the numbers I posted last week they only add up to ~40% of the decline in exports avaliable on world markets.  Another 600kpbd of consumption had to be avoided from other countries for supply and demand to be balanced.  The only way prices decline is if production increases. 

Here is the table again for those that might have missed it:



by alphasigmookie on 06/09/2008 12:32:48 AM EST

[ Parent ]
This (none / 0)
does not justify the massive increase in price, especially considering that oil consumption will surely fall even faster this year in the OECD than in 2007. Should the oil price be higher than where it was in 1998? Yes obviously, but there is no way the price could go up as fast as it has considering that the "fundamentals" are against an increase in the price of oil, its more akin to a stabilization of the oil price. The market does not run on supply and demand, it runs on:

a) international tensions, especially the Middle East (mere tension raises the price)
b) supply shocks, Nigeria
c) profit stabilization, if the oil majors did not increase price they would not be profitable enough, capitalists want to beat the average, profit isn't enough.
d) people's whose income derives from non-productive activities, such as wealthy investors, have little choice but to invest in commodities after the end of 3 booms, this is why financial markets are INEFFICIENT because they misallocate funds to profitable not "utility-maximing" ; functions.
e) inflation is necessary to avoid a depression, in order to reduce liabilities of financial institutions in particular, due to the fact that their liabilities are priced at higher interest rates and based on much higher capitalization - inflation is induced by speculation and manipulation by speculators who are the same people who need it to suppress their debts.

What proves this theory of supply and demand moot is the SPEED at which the price has gone up, there is no reason for the rapidity of the price to go up so fast so high. Secondarily, the economy is not run by some invisible hand, there are real people, with real interests in the economy. Thus, is supply and demand an abstraction and mystification to suppress the working classes? OF COURRRRRRSEEE...the religion of equilibrium has replaced god, but it too is based on a faith that has no rational basis.

Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/09/2008 02:07:16 AM EST

[ Parent ]
Real people with real values (none / 0)
"What proves this theory of supply and demand moot is the SPEED at which the price has gone up, there is no reason for the rapidity of the price to go up so fast so high.  Secondarily, the economy is not run by some invisible hand, there are real people, with real interests in the economy."

The reason the price is so high is that people NEED oil.  It is not like a commemorative elvis plate offered on late night TV for 3 easy payments of 9.99 that people can do without.  What the price represents is the VALUE of oil to people who need to drive 35 miles a day each way to work in their large SUV and to fly across the country to disney world for their family vacation, not the cost to extract oil from the ground.  There are 1.5 million barrels a day less on the global market than there were 2 years ago which means a lot of people had to give up something.  They had to move closer to work, trade in their suv,  skip the family vacation, or video conference instead of meet a client face to face.  All of these things are important to them and they don't make these decisions lightly.  People do not change ingraned behavior over a few cents a gallon...large price increases are required for people to make even incremental changes. 

A great example comes from a fellow I met a few weeks ago at a conference.  He was an engineer for Texas Instruments.  He commutes 180 miles each way every day in a chevy suburban from dallas to austin texas.  He said he owns a honda civic, but he lets his wife drive it around town because she doesn't like the suburban.  He also had another car (forget what kind), but his daughter's broke down so she drives it.  I asked why he didn't move closer and he said it was more important for his daughters to graduate from the same high school they'd been going to.  To this man (and I assume many like him) the cost of gasoline does not come close to balancing the benifits it provides (happy wife and happy daugher).  Frankly I thought he was crazy, but who am I to tell him what he should or should not value? 

by alphasigmookie on 06/09/2008 02:49:51 AM EST

[ Parent ]
He needs to rethink things (none / 0)

"I asked why he didn't move closer and he said it was more important for his daughters to graduate from the same high school they'd been going to."

And yet by the time they reach their 40s gasoline may be a precious luxury, airline travel a thing of the past.  Will the jobs they're training for still even be around?  He might be doing them more of a favor by teaching them to milk cows.

 

by bfaul on 06/09/2008 10:51:52 AM EST

[ Parent ]
Blah Blah Blah (none / 0)
As usual its nonsense, what you are arguing is that there is a PHYSICAL undersupply of oil, yet no where in the world are there shortages. Indeed, your argument would only make sense if there were shortages or imminent shortages, but there is no where a shortage of gasoline or oil. Secondly, Americans are stupid as your examples show. Thirdly, ancedotal evidence is not > actual evidence. So, try again :)

Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/09/2008 12:46:07 PM EST

[ Parent ]
ignorance is astounding! (none / 0)
There should NEVER be shortages in a market economy.  That is how it works.  The price rises until enough people cry uncle that supply and demand are in balance.  Until you understand day one of econ 101 you have no business discussing such issues. 

by alphasigmookie on 06/09/2008 01:37:44 PM EST

[ Parent ]
Normative vs. positive (none / 0)
There have been many instances in where the so called "market" economy has failed to provide, and shortages prevail. 1970s oil crisis, shortages...the constant shortage of jobs, etc. The assumptions you make are this:

1) Demand curve is downward sloping, this cannot be proven to be true, in some cases it may actually be upward.
2) Supply curve is upward sloping, Sraffa shows that it can be flat.
3) Equilibrium is never reached, how do we know? Prices always change, why? Because equilibrium doesn't exist.

I took Micro/Macro economics in university, I still don't buy it. + who here is more educated? Me or you...hahaha.

Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/10/2008 02:51:17 PM EST

[ Parent ]
Defending my assumptions (none / 0)
I will admit that my assumptions only work on relatively free markets.  Oil markets are not exactly free (many nations subsidize oil prices for their citizens, something that a socialist like yourself would normatively agree with), but they are freeer today than they have been at any previous point in history. 

1) demand curve
you yourself have admited that demand decreases at higher prices:

"US consumption is going down"

Where demand could increase in the face of increasing prices is generally a result of increased population or increased value provided by the commodity of interest.  If it makes you happy though I'll generally conceed that the demand curve does not have to be downward sloping, but it does appear to work that way in this case.

2) supply
I never said the supply curve is upward sloping.  Actually I have frequently said that I believe the supply curve for oil is plateauing and will soon decrease due to geological and political reasons, not economics.

3) equilibrium
Equalibrium is dynamic, as are prices.  At every point in time the price represents the equilibrium between the bid and the ask or buyers and sellers. 

As for education, that is a very normative statement.  It depends upon the value of what each of us have learned.  My knowledge base...A bachlors in Chemical Engineering has a high market value and has allowed me to earn a very nice living which I have chosen to give up in exchange for a high paying fellowship to get a PhD in Sustainability and Renewable Energy.  Your education seems to have allowed you to write verbose commentary about other peoples ideas with absolutely no market value (thus your insistance on economic systems that take property from those with high market value skills to those without any). 


by alphasigmookie on 06/10/2008 05:00:18 PM EST

[ Parent ]
So why bother? (none / 0)
"I will admit that my assumptions only work on relatively free markets."

So why bother talking about, and making arguments on something that empirically does not, and cannot exist? Why are you wasting my time, and that of others if you concede that the premise of your analysis and arguments does not exist?

"Oil markets are not exactly free (many nations subsidize oil prices for their citizens, something that a socialist like yourself would normatively agree with), but they are freeer today than they have been at any previous point in history. "

No market is "free" by the neoclassical definition of the term, if you had any idea of what you were talking about you would know this to be true. Lets get out of this false premise/sandbox you call life, into the real world.

"If it makes you happy though I'll generally conceed that the demand curve does not have to be downward sloping, but it does appear to work that way in this case."

Impossible within a neoclassical framework, thanks for further invalidating your paradigm of analysis. You know you are making this WAYYYY too easy for me.

"2) supply
I never said the supply curve is upward sloping.  Actually I have frequently said that I believe the supply curve for oil is plateauing and will soon decrease due to geological and political reasons, not economics."

Ummm...you took macro/mirco classes right? You know that the supply curve has to do with prices (marginal productivity, diminishing returns, etc.) not actual supplies of goods? The logic of supply curve, as production increases as does the price of the good (which is not always true), NOT with actual supplies of goods...ya and you tell me to learn Economics 101...anyways! Secondly, are you actually trying to make economics into a separate reality away from politics? God...how base!

"3) equilibrium
Equalibrium is dynamic, as are prices.  At every point in time the price represents the equilibrium between the bid and the ask or buyers and sellers. "
Really...thats interesting because equilibrium means that supply and demand are perfectly fixed and only a exogenous factor can make that go out of whack. Of course a "dynamic equilibrium" is a contradiction in terms...but if this assists you at night to sleep, continue. I'll quote for you:

"Keynes was right: it is not valid to ignore the transient state of the economy. As Fisher later observed, equilibrium conditions in the absence of disturbances are irrelevant, because disturbances will always occur. Whether equilibrium is stable or not, disequilibrium will be the state in which we live...As Keynes  once remarked, 'equilibrium is blither'. So why, fifty years after Keynes, are economists still blithering?...There are many reasons, but the main one....is the extent to which the core ideological beliefs of economists are bound up in the concept of equilibrium. As a by-product of this, economists are driven to maintain the concept of equilibrium in all manner of topics where dynamic, non-equilibrium analysis would not only be more relevant, but frankly would even be easier. This obsession with equilibrium has imposed enormous costs on economics" (Keen 177).

Deal with it.

"As for education, that is a very normative statement. "

Do you know what normative means?

"Your education seems to have allowed you to write verbose commentary about other peoples ideas with absolutely no market value (thus your insistance on economic systems that take property from those with high market value skills to those without any). "

Interesting that, I am among 50 students among the 3000 + who applied to one of the top 5 schools in the world (if you take out US universities) who got into their graduate program...I'd say, my degree is worth quite a bit. But, I do not have to defend myself against you, because its obvious "economically" wise education, as you so call it, makes you into a unworthy competitor. :)

Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/10/2008 10:56:01 PM EST

[ Parent ]
Neoclassical theory (none / 0)
You seem to have done a reasonably job of critiquing neoclassical economics, but frankly all that is simply irrelivent theoretical bullshit.  If it will make you happy i'll conceed defeat in the area of theretical economical bullshit. 

"there is no way the price could go up as fast as it has considering that the "fundamentals" are against an increase in the price of oil, its more akin to a stabilization of the oil price."

However, you have yet to explain why decline of physical supply of a vital commodity on the global market should not logically lead to large price increases....especially when the value (utility) it provides people has been significantly higher than the price (traditional related to the price to produce) for nearly a century.  For comparison, one gallon of gasoline contains the same energy content as aproximately 500 hours of human labor (at least in the agricultural sector).  Thus for $4 I can buy the same output that would cost me $7500 in your socialist paradise, at least $3600 in the US, or $400 in China. 

by alphasigmookie on 06/11/2008 12:44:42 AM EST

[ Parent ]
Re: (none / 0)

"You seem to have done a reasonably job of critiquing neoclassical economics, but frankly all that is simply irrelivent theoretical bullshit.  If it will make you happy i'll conceed defeat in the area of theretical economical bullshit. "

Thank you for realizing what is bullshit neoclassical economics is. I am not trying to make people look stupid when I tell them they are wrong, but if they insist on avoiding the actual issues with abstractions and mystification's, essentially by attempting to belittle my opinion as mere "socialist banter" there is little choice but to go on frontal attack.

Secondly, it is no irrelevant, it is very relevant; it is that theory that justifies policies that prejudice against the poor, have lead to the destruction of America's union movement, the massive redistribution of wealth to the rich through regressive tax cuts, worst off...justifying all this by creating a mythology of naturalization of this exploitation. As Margaret Thatcher said, "There is no alternative"...well, its time we get one.

"However, you have yet to explain why decline of physical supply of a vital commodity on the global market should not logically lead to large price increases....especially when the value (utility) it provides people has been significantly higher than the price (traditional related to the price to produce) for nearly a century. "

First off, utility is unmeasurable thus lets get that out of the equation. There is no physical decline of oil, secondarily there is excess capacity available. If there was a "physical decline" as you suggest, the price of the good should not go up as fast as it has in the past 3 months, especially considering like I said there is excess capacity. Thirdly, consumption is way down in the OECD especially with a slowing economy (thats why consumption is mostly down, because people are getting laid off, and fear about their incomes). In Europe and Japan, because the governments are proactive and interfere in the "free market" and have learned from the 1970s oil crises, something the US gvt did not learn, they are more competitive and efficient economies than the US. Thus, with millions of barrels going to be taken off OECD consumption this year, I doubt that China and India will make up the difference, and Brazil is self-sufficient.

What is moving the markets? Its EXTREMELY complex, and it has little if anything to do with actual "markets". It has to do with power within the global economy, who stands to benefit from high prices? Oil majors. Who stands to benefit from a sinking dollar, and creating inflation? The US, basically creating the largest debt default in history. We've been down this road before, 1970s. As I wrote in one of my papers:

"The origin of the debt crisis stems from the crisis of overaccumulation in the American economy during the 1970’s. The American economy started the post-war era being the most competitive and industrial economy in the world. By 1971, the United States was no longer economically competitive against the booming Japanese and West German economies. The American administration sought to rebalance the world economy through two mechanisms: devaluing the US dollar by abandoning the Bretton Woods system, and inducing an increase in the price of oil. David Harvey argues that the American government did this on purpose: "the collusion of the Nixon Administration and the Saudis...[to inflict] far more damage to the European and Japanese economies" (Harvey 77). Indeed during the period 1974-1975, the United States was able to post trade surpluses with OPEC states (Chomsky 170). Also the flows of oil dollars did not stay in these OPEC states for domestic development but went to American financial markets to subsidize American financial hegemony. The result of these measures were to undermine foundations of the Japanese and West German economies, and shift the American economy away from a productive industrial economy to a service based financial economy through the flows of petrodollars to American banks.


OPEC states, especially the Gulf States, invested billions of dollars worth of “petrodollars” in American banks. This was part of the implicit contract between the United States and the oil producers; the American government supported the regimes as long as the profits from the oil sales went to the United States (Chomsky 169). Thus, this alliance had facilitated the United States to establish her preeminence economically by becoming what Arrighi called the “global financial entrepôt” (Arrighi 21)."


Again, neoclassical analysis is STILL the basis of your analysis. The economy is ABOUT POWER, who has it, who uses it, and why. Let's get serious.

Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/11/2008 01:53:15 AM EST

[ Parent ]
Close (none / 0)
"Again, neoclassical analysis is STILL the basis of your analysis. The economy is ABOUT POWER, who has it, who uses it, and why. Let's get serious. "

Actually the basis of my argument is really thermodynamics...the economy is really about ENERGY and who can most efficiently harness and exploit it...which LEADS to power. 

"utility is unmeasurable thus lets get that out of the equation"

That may be true of flat screen TVs and economics books, but any energy source be it human labor, food, oil or solar energy can be measured on a uniform scale as the ability to do work.  While the utility in an economic sense of the word may depend on what purpose that energy is directed, its utility in terms of potential usefullness is easily measured. 

As for the 1970's, you are right on the time frame, but off on the causes.  The root cause is that in the 1970 US oil production peaked...thus our energy golden goose began to sputter.  Since then we have been scrabling to use up as many eggs from everyone else's golden geese before they all realize how truely valuable they are. 



Since we're quoting old material, here's an oldie but goodie since you're new here you probably missed this one:

http://www.theyoungturks.co m/story/2007/1/19/172358/90 0/Diary/Energy-is-the-Key

Here is the meat:

"In the real world when we think of energy we trypically think of oil, coal, natural gas, and sometimes nuke and alternative energy.  However, energy takes many other forms such as manpower, and food.  The sucess of every single country or civilization in history has been directly tied to their supply or energy.  Those countries which are able to sucessfully grow large surplusses of food can support large populations which provide a large labor force for industry and inovation.  Those countries with good supplies of fossil fuels can cheaply build and run machines to increase productivity freeing manpower for other activities.  For all you history buffs, is there any doubt that the industrial revolution was the direct result of the discovery of efficient means to exploit coal and oil?

You can even extend this to wealth and currency.  In essence all a dollar represents is a promise to provide future work (or goods which were the direct result of work) in exchange for actual work or goods.  Therefore all economics can essentially be broken down to flows of energy. "

by alphasigmookie on 06/11/2008 04:10:24 AM EST

[ Parent ]
Scary... (none / 0)
"Actually the basis of my argument is really thermodynamics...the economy is really about ENERGY and who can most efficiently harness and exploit it...which LEADS to power."

Errr...false, sadly "thermodynamics" means nothing, the economy is not operated rationally. It is not about about energy as a material supply, its about who owns the oil. If you think that the "efficient" use of energy is the source of power, you again lack the knowledge of the actual economy. The whole economy is based on pecuniary considerations (profit), not about industrial efficiency, etc. If something makes a businessman profit but it very inefficient, do you think the businessman cares about the efficiency of the industrial process? I will have to quote for you again, this from American theoretician Thorstein Veblen, who is not a socialist but an institutionalist:

"The motives of the business man are pecuniary motives, inducements in
the way of pecuniary gain to him or to the business enterprise with which he is identified. The end of his endeavors is, not simply to effect an industrially advantageous consolidation, but to effect it under such circumstances of ownership as will give him control of large business forces or bring him the largest possible gain. The ulterior end sought is an increase of ownership, not industrial serviceability. His aim is to contrive a consolidation in which he will be at an advantage, and to effect it on the terms most favorable to his own interest."
--------------------------- --------------------------- --------------------------- -----------------------
" The vital point of production with him is the vendibility of the output, its convertibility into money values, not its serviceability for the needs of mankind. A modicum of serviceability, for some purpose or other, the output must have if it is to be salable. But it does not follow that the highest serviceability gives the largest gains to the business man in terms of money, nor does it follow that the output need in all cases have other than a factitious serviceability. "

(Theory of Business Enterprise, Chapter III).

"That may be true of flat screen TVs and economics books, but any energy source be it human labor, food, oil or solar energy can be measured on a uniform scale as the ability to do work. "

Energy is not utility, 1000 watts of human labour and 1000 watts of  a light-bulb is the same when measured but its not the same in terms of output, so even if it can be measured its telling us absolutely nothing.

"While the utility in an economic sense of the word may depend on what purpose that energy is directed, its utility in terms of potential usefullness is easily measured. "

Again, no its not. First off, you do not know, evidently, what utility means in an economic sense. This is akin to your statement about the "supply curve going flat" based on actual supplies...do you want to play these games of you not knowing what you are talking about and I have to disprove it in  a long process of destruction?

"As for the 1970's, you are right on the time frame, but off on the causes.  The root cause is that in the 1970 US oil production peaked...thus our energy golden goose began to sputter.  Since then we have been scrabling to use up as many eggs from everyone else's golden geese before they all realize how truely valuable they are. "

The US oil production peaked in 1970, prices did not increase until 1973, and then reached a all-time low in 1999. How do you explain that, if domestic supplies were already in deep decline by that point from the peak? Again, you are wasting time in attempting to explain what you clearly do not know about.  Anyone with a modicum of history knows that the only reason why prices shot  up in the 70s was because of geo-political/economic concerns. Nixon according to the sources I have used, wanted there to be a huge increase in the price of oil, because its a lever of POWER against stronger economies against the US. Today, the price of oil is going up again due to power issues, especially of oil corporations who are seeing their production decline but still need to make ever increasing profits; the only way they can do that is through price manipulations. That is one aspect of the rise in prices, there are other reason that may explain the rise in oil.

The so-called "meat":

"The sucess of every single country or civilization in history has been directly tied to their supply or energy.  Those countries which are able to sucessfully grow large surplusses of food can support large populations which provide a large labor force for industry and inovation. "

Then why is India as poor as it is? It has all those conditions, oh yes because simple, idiotic analysis of the world which ahistoricizes the process of development comes to these conclusions...stupid me!

Alpha, you really gotta stop with these joke posts...its not funny anymore, I actually think you believe what you are writing and it scares me!


 


Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/11/2008 03:05:54 PM EST

[ Parent ]
thank you! (none / 0)
"its about who owns the oil."

Yes!  Its about who owns the oil because OIL IS POWER (at least for those societies that learn how to effectively harness its power).  Oil allows for radical increases in productivity of an economy.  It also allows for the development of supersonic stealth jets with laser guided bombs to consolidate and maintain the power it provides.  It allows for a single famer working a massive combine to work the same land that it would take hundreds of mule drawn plows to work, freeing those people to pursue other productive activities (like arguing on the internet instead of gathering berries or hunting buffalo to survive).   

"1000 watts of human labour and 1000 watts of  a light-bulb is the same when measured but its not the same in terms of output, so even if it can be measured its telling us absolutely nothing."

Again your are confusing the fundamental value with the economic activity to which it is directed.  1000 watts of human labor could easily be converted to 1000 watts of light by using a hand crank flash light.  There are clearly losses in conversion of energy (pesky thermodynamics again) but it can almost always be done.  Energy has even allowed for the replacement of many tasks that were traditionally assumed to only be able to be performed by humans.  4 AAA batteries allow my TI-89 calculator to perform calculations that might have taken me hours in seconds. 

"Then why is India as poor as it is? "

Low energy intensity.  Their per capita energy use is a fraction of that of the rest of the world, thus their per capita economic output is also a fraction of the rest of the world.  Prior to the industrail revolution, human labor was a main source of energy...now fossil fuel use dwarfs the productivity of raw human labor.  A barrel of oil contains 5,900MJ of energy, a year of human labor (50 weeks a year, 40 hours a week) is 720MJ.  There are 6.7 Billion humans on the plannet which is 4.8 E6 TJ per year.  The world uses 31 Billion barrels of oil which is 1.8 E8 TJ.  Thus the energy provided by oil alone is aproximately 38 times as much as the energy provided by human labor in a given year.  Oil itself accounts for a little less than 40% of global energy use.  Thus human labor directly accounts for only about 1% of the work done each year!  To think of it another way...controlling a single barrel of oil is like having 8 slaves for a year without the guilt!  Because of this, any economy that is highly dependent upon human labor will be at a major disadvantage when competing against an economy that can harness large quantiteis of energy by other means. 

by alphasigmookie on 06/11/2008 05:18:15 PM EST

[ Parent ]
WTF are you blabbing about? (none / 0)
What does anything you just said have to do with the price of oil which is the actual discussion? Secondly, there is no universal measurement which transforms action into values. Thirdly, you still do not understand the PREMISE of the capitalist economy, accumulation, until you understand that basic almost common sensical foundation everything you say is complete bull shit.

"OIL IS POWER"

Wrong, ownership is power=money is power. If you didn't already know, oil or petroleum is a inanimate object. Power is a SOCIAL RELATION, meaning it pits one against another, to which one is superior to another. The actual definition is forcing A to something that A otherwise wouldn't do. That power relation in our modern economy is based on private property, oil is merely PART of that matrix, but oil unto itself is not power. The control of oil (supply of oil, price of oil, investment in oil, increasing monopolization of supply/price/assets) is power, not oil itself. You don't understand that this isn't an issue about "societies" its an issue of class. If you believe the globalization thesis, your analysis is stuck in some Leninist imperialist epoch where states competed with each other for land and resources. In 2008, the issue is about corporations, who have interests in the global market. All societies are being screwed over by the same processes, regardless of where they are, unless their governments intervene to counter the power of corporations. Let me put it like this, in a world without oil (which will eventually happen) does power disappear? This is the LOGICAL conclusion of your ridiculous argument.

Your ignorance in relating to the actual logic and workings of the capitalist system is obvious, I quoted for you one of the most important theories of capitalism to come out the American intellectual community and you ignore it because it doesn't fit into some pseudo-scientific analysis that justifies your irrationality.

"It also allows for the development of supersonic stealth jets with laser guided bombs to consolidate and maintain the power it provides. "

Before oil there was no power then? What are you saying here? Was not the British Empire, the Spanish Empire worldwide in scope, killed millions, enslaved millions based on wind-power and coal power? It does not matter what commodity exists as the predominant form of energy because it will eventually be replaced. The actual problem is who is to harness the next form of energy, if there is a viable alternative.

"It allows for a single famer working a massive combine to work the same land that it would take hundreds of mule drawn plows to work, freeing those people to pursue other productive activities (like arguing on the internet instead of gathering berries or hunting buffalo to survive). "

Ok captain obvious, what are you blabbing about here? This has nothing to do with anything.

"1000 watts of human labor could easily be converted to 1000 watts of light by using a hand crank flash light.  "

I don't care about that, if we are to measure things for their qualitative worth we have to look at their output. 1000 watts of manpower > 1000 watts used to light a bulb, but there is NO MEASURABLE way to show this. This is the problem with both neoclassical and Marxian analysis...stop obfuscating the issue with your irrelevant scientific rationales.

"Low energy intensity.  Their per capita energy use is a fraction of that of the rest of the world, thus their per capita economic output is also a fraction of the rest of the world. "

Great, you haven't answered my question...why. Again, when you ahistoricize entire countries you get these sorts of bull-shit answers. You are merely pointing out the obvious, you are not actually telling me anything that I already didn't know. There is no critical analysis in your ENTIRE post...your talking about AAA batteries for fucks sake!

"Because of this, any economy that is highly dependent upon human labor will be at a major disadvantage when competing against an economy that can harness large quantiteis of energy by other means. "

China? Thanks....again you fundamentally misunderstand how the economy works. As long as you think like some neoclassical that things are determined by endowments and not looking into how countries with no natural resources like England, Japan became superpowers (which contradict your entire arguments of large endowments = strong states) and not looking how an economy actually works, meaning profit/accumulation you will be talking about AAA batteries while the world moves on.

Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/11/2008 06:22:10 PM EST

[ Parent ]
Just one more thing (none / 0)
Since we seem to have diverged to the point where we are arguing completely different things I will finish with this...

"Secondly, there is no universal measurement which transforms action into values."

I will agree with this, but there is a universal measurement that converts energy into actions, its called thermodynamics.   I would argue that it can be useful in informing economics since actions are generally  made by agents with values in attempts to bring about desired outcomes. 

Values however are completely contingent upon the exact situation and the agent doing the valuing.  There is no such thing as fundamental or abolute value of a good.  The value of a cheesburger to a starving child in Africa is far higher than its value to a vegan in San Francisco.  It is the dynamic expression of these individual values that create an economy. 

by alphasigmookie on 06/11/2008 06:57:38 PM EST

[ Parent ]
Re: (none / 0)
"I will agree with this, but there is a universal measurement that converts energy into actions, its called thermodynamics.  I would argue that it can be useful in informing economics since actions are generally  made by agents with values in attempts to bring about desired outcomes."

Thermodynamics, if it were what say it is, don't you think they would have adopted it asap? Energy only tells us costs, how much energy is expended to get x, it does not tell anything about how much x is worth, nor does it even tell us which energy is valued more. 1000 watts of human/non-human labour is not valued the same. So no, it doesn't help economics, because economics is pure and simple about values and prices. Thermodynamics is for you scientists and it will stay there.  

"There is no such thing as fundamental or abolute value of a good.  The value of a cheesburger to a starving child in Africa is far higher than its value to a vegan in San Francisco.  It is the dynamic expression of these individual values that create an economy."

You are driving further away from neoclassical analysis the more you talk. This makes me happy :). Neoclassical economics is about aggregating the individual indifference curves, demand curves, and supply curves, and the only way you can do that is if there is one single absolute measurement, and that is the unmeasurable utility that neoclassical economics is entirely based on. So, please get out of this neoclassical matrix, I suggest you get the book:

"Debunking Economics" by Steve Keen:

http://www.debunking-econom ics.com/

For a start.

Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/12/2008 04:20:53 PM EST

[ Parent ]
common ground (none / 0)
It tooks us a while to get there but i think we've found some.  I never said neoclassical econmics was perfect.  Like classical mechanics it gets some stuff generally correct but it oversimplifies many things.  However because it does not get things perfect does not make it uesless, just not universally applicable. 

Because neoclassical economics can't predict supply and demand curves, does not mean that markets cannot discover those curves and effectively allocate resources.  While central planning becomes difficult without knowledge of values and preferences, markets have the ability to self organize based upon the individual choices and values of the participants.  That of course is not to say that markets will always be perfectly efficient as there will always be imperfect information and externalities that are not included. 

Last word on thermodynamics:

The reason thermodynamics hasn't been used in economics is that economists don't have the first clue about it and Engineers and Physisist generally think economics is worthless fuzzy social science (we also believe we could solve all the worlds problems if the economists and politicians would get the hell out of our way!).  Why thermodynamics is potentially useful is that it provides a common currency to measure the cost of a ton of cement, 1000 watt hours of light, or a blog post.  While the value of these things will vary, the costs are roughly interchangable. 

An efficient economy will direct its efforts to activities with low energy cost and high value produced first until all energy that is avaliable has been used.  The ultimate limit of any economy however will be how much effort or energy can be expended on all activities.  Thus a country with 1 GJ per capita per year will almost always have a smaller, weaker economy than one with 100 GJ per capita per year.  The relationship will not likely be linear with energy consumption, since economies with more energy avaliable are more likely to "waste" it on lower value activities, but the trend should be near universal. 

by alphasigmookie on 06/12/2008 06:15:54 PM EST

[ Parent ]
Not so fast... (none / 0)
No, I don't agree. You just don't get the premises of neoclassical analysis, it claims to have predictive power. Meaning that it sees its analysis as natural and perfect, the only reason why things don't turn out their way is because of "politics" and interference from non-rational actors. Its like Einstein's E-MC2, its foundational to all of physics, same with utility and neoclassical analysis; without utility the whole enterprise fails. Imagine if it proven the E=MC2 was proven to be wrong (and it was almost was in the 90s), the entire science of physics would have be to reevaluated, the only reason economists have not bothered is because most do not even know that there is a logical fallacy behind their analysis.

Neoclassical analysis is not useful because it adds nothing but takes away a lot, principally its really a mechanism to redistribute wealth from the working classes to the higher classes. This cannot be denied, so neoclassical analysis is again an issue of power not objective academic enterprise. Neoclassical analysis was a reaction against Marxism which attempts to destroy the class system in its entirety and Marx considered himself a classical economist and he did too much damage using classical analysis against classical analysis.

Markets as you conceive them do not exist, major corporations are the largest and most successful socialist organizations in the world. So why is it that corporations can plan successfully, and the state cannot? I am not buying that argument.

On thermodynamics:

It may work, but not within a capitalist system. If you engineers and scientists want to create a new more efficient economy, you have to destroy the market economy (pecuniary economy). The modern economy is measured using money not efficiency, no one cares about that unless it increases profit. Marx even noted that capitalism is actually against the implementation of progressive technology because it threatens profit, and we saw that with the death of public transit, and the death of the electric car in the 50s and 90s. While it may be possible to create a society where reason, and science dominate, it is not possible within the current state of the economy. So you have an inherent contradiction in your logic:

You support the market economy, yet oppose the inefficient operations of that economy.

Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/12/2008 06:34:56 PM EST

[ Parent ]
How to better allocate resources? (none / 0)
"So why is it that corporations can plan successfully, and the state cannot?"

GM and Ford are perfect examples of corporations that have failed to plan sucessfully.  Luckally there are a number of other corporations like Toyota and Honda have done a better job of planning so the consumer still has a choice.  When markets break down is when monopolies or near monopolies form, this lowers the resilience of the system, government ownership of capital is the ultimate monopoly.  

"The modern economy is measured using money not efficiency, no one cares about that unless it increases profit."

Profit is a measure of efficiency.  It is the difference between the cost of an activity and the value it provides(definied as the price the market participants will pay).  Where I think you have a problem with profit is that profit leads to increased capital which provides oportunities to increase profit further leading to a consolidation of wealth (sweet sweet compound interest!).  Your solution (I assume) is to punish profit through excessive taxation and redistribution to people who's activities do not result in significant profit.  Thus punish those operating efficiently to subsidize those operating inefficiently.  

I would argue that that is the absolute wrong way to make an economy more efficient.  The reason the current system does not work well is not because of profit, but externalities.  Burning mass quantities of fossil fuels and producing products with short lifespans is the result of the fact that waste and pollution have no cost in the current market economy.  If we were to instead shift the tax burden from a good (profit = economic efficiency)  to a bad and instead tax throughput, materials, energy, pollution and waste it would induce a huge shift in the market.  Unfortunatly this idea may be even more politically unpopular than even your Robin Hood strategy.    
 

by alphasigmookie on 06/12/2008 07:40:09 PM EST

[ Parent ]
Point of clarification (none / 0)
"nor does it even tell us which energy is valued more. 1000 watts of human/non-human labour is not valued the same."

I'm not sure you quite get this yet.  A MJ of electricity, steam, oil, food, and human labor are roughly interchangable through various tools or machines.  It is true that there are a few exceptions to this and that some conversions lead to larger inefficiencies, but roughly with todays technologies there is very little about human labor that is special.  Combines, dump trucks, factories, nail guns, backhoes all replace human muscle with other energy sources...intellectual and creative activities as well as running and maintianing the machines are the few remaining places where humans are difficult to replace. 

by alphasigmookie on 06/12/2008 06:31:09 PM EST

[ Parent ]
Ken's Argument in a Nutshell (none / 0)
http://biz.yahoo.com/hftn/0 80606/060608_tully_oil_bust _fortune.html

This guy does a better job than ken of making the same argument.  Unfortunatly it all hinges on one very critical assumption:

"We don't know where the new abundance will come from, from shale, or tar sands or coal or an OPEC desperate to regain market share. We just know that it will appear. With prices like these, it always does."

Basically the market will provide a solution because there is a demand.  I will grant that this is always a possibility, but it is definitely not a certainty.  Also, when and after how much pain is another very open question. 

by alphasigmookie on 06/09/2008 02:58:08 AM EST

[ Parent ]
one thing is for certain (none / 0)
Either you are correct, or I am correct. And we won't have to wait long to find out which one of us is correct.

by KenTX on 06/09/2008 05:12:42 AM EST

[ Parent ]
uuhh the point.. (none / 0)
the point is oil is going up either way..

Witch hunt won't fix oil price

we need a mass transit now..(yesterday)
these red states that have given there finger to mass transit are going to become waste lands..

Goldman Oil Bull Speaks: Yes, Oil Still Going to $150-$200 A Barrel,

some think your right nick hope so...

Goldman Oil Bull a Nutcase: Here's Why Crash Coming Soon

by Bungle on 06/08/2008 06:58:47 PM EST

prices in Los Angeles (none / 0)
In my area in Los Angeles, the lowest price I've seen is in the high $4.30s per gallon. That's the lowest price. Some stations are around $4.70 a gallon.  Everyday I am more glad I bike to work.

David

by yturks on 06/08/2008 08:02:43 PM EST

There's a larger point here (none / 0)
Everyone debating back and forth about the reasons for the oil increase and whether it will continue or crash are missing the larger picture.  It is beyond foolish to continue to pin our entire economy (in the US and globally) on one commodity.  We need to work very hard to implement alternatives and make them practical so that we are not slaves to these fluctuations.  Th ink of how much more advanced we are technologically since the mid 1800's.  We landed on the moon, we have advanced computors, etc., but we still have not gotten past the internal combustion engine in a meaningful way.  Why do you think that is?  It's not because we aren't intelligent enough to come up with a better system. 

by jawill11 on 06/09/2008 08:10:36 AM EST

There's the rub (none / 0)

"We need to work very hard to implement alternatives "

Although this is true bear this in mind,  alternatives could provide maybe 20% of what we consume, and that only after a tremendous effort.  20 percent.  It is important to understand the ramifications of that fact.

by bfaul on 06/09/2008 11:05:52 AM EST

[ Parent ]
Even if Ken is right (none / 1)
I don't expect we will ever see gas much less than $4 a gallon. Maybe if we are lucky $3.50, but I wouldn't bet on that. Once people have adjusted to these high prices big oil will hold the line on prices just as they have in all the bubbles past. Even when oil dropped to $8-$9 in the late 90's, prices only dropped to $1.20 from $1.70 at $40 pbl. The perfect economic storm looks like it may be upon us; unemployment, inflation, Commodities high prices. People are afraid, and fear feeds the problems. Borrowing money to live on makes no sense for family's and makes just as much sense for our gov. The bubble that bursts may not be the one you are so optomistic about. It may be the bubble that was created by the New Deal and plunge us back into a depression we are ill prepared to deal with.

by juebawl on 06/09/2008 08:26:07 AM EST

Re: (none / 0)
"When markets break down is when monopolies or near monopolies form, this lowers the resilience of the system, government ownership of capital is the ultimate monopoly."

Monopolies are inevitable, we have monopolies-oligopolies at best-today. Why? Economics of scale will always lead to greater power in fewer and fewer firms, I will quote:

"Hence increasing returns to scale mean that the perfectly competitive market is unstable: it will, in time, break down to a situation of either oligopoly...or monopoly...Economists have been well aware of this dilemma...The argument that, 'in the long run', this industry could be perfectly competitive because it could grow big enough to support hundreds of thousands of competitors is ludicrous. By the time the world was large enough to support hundreds of Boeings, it is highly likely that some entirely different form of transport would be superseded the aeroplane...If so, then unless an industry is already big enough to support the enormous number of firms surmised by the model of perfect competition-all operating at the idea scale-large firms can immediately out-compete small firms. In other words, the only way competitive firms can survive is if the industry is already so large that if can support an enormous number of firms of the ideal scale." (Keen 104).

Never-mind, the tendency towards mergers and acquisition, barriers to entry, preferential credit treatment, etc. Remember that in order for your assertions to make sense, there has to be a perfectly competitive market, without such a market your analysis and justification of the system fails utterly to explain anything. Thus, yes "markets" have broken down...I argue that the market does not and cannot even exist as you conceive it. Which brings me back to the question, why is it ok and rational for a firm to have planning with no prices or prices determined by the firm itself (transfer pricing) yet the state cannot?

"Profit is a measure of efficiency. "

Yes, from a monetary standpoint not a industrial/material allocation, efficiency standpoint. You have to separate the two because they are not the same, read Veblen.

Listen, Alpha....unless you do the required readings you will be continually contradicted against because you are using the logic and arguments of a FALSE system of analysis.

"Where I think you have a problem with profit is that profit leads to increased capital which provides oportunities to increase profit further leading to a consolidation of wealth (sweet sweet compound interest!). "

No, my problem is not accumulation, my problem is what is done with that accumulation. Does it go to increase production of goods and employment or go to pump up a very small group of people's bank accounts? Accumulation is necessary for progress, indeed thats exactly why I am against this system because it is retarding progress. Want proof? Look at how much we are doing for Global Warming...the ULTIMATE example of the "market economy" failing.

"Your solution (I assume) is to punish profit through excessive taxation and redistribution to people who's activities do not result in significant profit.  Thus punish those operating efficiently to subsidize those operating inefficiently.  "

Assume = ass-u-me...don't assume, because the rest of ur argument is based on an assumption I will not bother.


Blog: http://perspectivos.blogspo t.com/

by Nick86 on 06/12/2008 08:40:47 PM EST

enlighten me then (none / 0)
All I can do is assume as you have not proposed a better system.  You have pointed to sweeden with its 50% of GDP tax rate, but given no further explanation....especially as to how an economy with only a few million people is applicable to much larger economies.  The biggest potential problem I see with the sweedish economy is that highly skilled, well educated workers make less than elsewhere.  Unless the entire global economy moves in this direction, it will be hard for economies like this to retain intellectual capital as workers move to locations with higher pay.  They do make great cars though (love my volvo!)

By the way you did not comment on my tax proposal, please point out how this would be a bad way to go economically. 

by alphasigmookie on 06/12/2008 10:31:43 PM EST

[ Parent ]
KenTX Shrugged (none / 0)
pie
When adding up ridiculously high state income taxes and property taxes and federal income taxes and state income taxes and sales tax and social security taxes and automobile taxes and medicare taxes, the average U.S. citizen does not have enough money to live on.

If we increase the federal income tax rate from 32% to 50% (which Barack Obama plans to do) it would no longer be worth it to work.

I will live off my accumulated wealth, and start collecting free benefits like government provided health care and social security. I feel sorry for you youngsters who will have to pay enormous taxes in order to take care of me for the next 40 years.

Sorry about that. Now, open up your wallets please.


by KenTX on 06/12/2008 10:44:17 PM EST

[ Parent ]
look for something to happen whit oil this week???? | 42 comments (42 topical, 0 hidden)
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