Gas Prices-Not Much Different Than the 1960's
Gas prices, gas prices, gas prices. That's roughly all I think about these days. So much so, I've nearly forgotten all about a war in Iraq that is draining our economy of almost $1 billion a day! In an attempt to put some of this in perspective, I thought I would briefly analyze the cost of fuel over a 50 year period and then look critically at our governement's response, or lack thereof, to rising fuel costs.
According to 1960sFlashback.com, the price of gasoline in the mid 60's was 30 cents a gallon. That's right, three silver dimes would have bought you a gallon of gas. However, if we take a careful look at the metal value of that silver, what we'd find is that those same 1960's silver dimes are valued at around $3 today, according to current silver standards. Silver was $1.29/ounce in 1964, and today's spot price is $12.93. If anything, the price of gas today is cheaper than it was in the 1960's, especially if we apply the gold standard, which would set the price of gas per gallon at $5.55 (Kitco). So, it has a lot to do with the value of precious metal and not so much a weakening dollar, contrary to public opinion. Besides, the dollar is no longer valued by precious metal standards as it once was, and therefore it is basically worthless. Thanks to my good friend Rana for reminding me of this.
So why was gas so cheap for so long and why the sudden rise? Most of our presidents have successfully lobbied OPEC to keep gas prices down, and it helped that the U.S. is the largest consumer of oil (21 million barrels a day). In fact, having traveled to Europe three times in the 1990's, and having worked there once, I discovered that Europeans were spending on a liter of gas what we were paying for an entire gallon. The average cost for a gallon of gas in Europe today is $8.70 (TIME). However, President Bush sees it as mutually beneficial to himself, a life-long oil man, and his Saudi Royal family, to bring us to those same levels of the 1960's, if not higher.
Wait! There's more. Our government, speculators, the media also have different opinions as to why oil prices are climbing. Some say it's a lack of supply, others say it's a weakening dollar, while others believe it's China's fault. Suppose all of these things are collectively true. What we'd still fail to recognize is that we have become inherently addicted to oil, and will not move our focus to greener, renewable sources of fuel until it's too late. Nor will we CONSERVE! As outlined years ago in Micheal Ruppert's book Crossing the Rubicon, oil production has reached a plateu, yet demand is steadily rising. At some point, demand will surpass production driving the price of fuel far higher than we can currently imagine. I need not scare you with the grim details of what will happen globally when this takes place, but rest assured, it's catostrophic.
Yet, I'm not as cynical as Marc Stephens who believes the government is doing it to keep our focus off of the war in Iraq and also to continue printing "fake money," though he may have something there. But oil is a limited resource, and the value, which follows the old adage, supply and demand, will only go up as that resource lessens. Oil rich countries, though they won't admit it, are beginning to run out of oil (Peak Oil.) In fact, according to David Stahan, author of the Last Oil Shock, "There are currently 98 oil producing countries in the world, of which, 64 are thought to have passed their geologically imposed production peak, and of those, 60 are in terminal production decline." With that said, it seems clear that countries, whose dominant resource (oil) is about to run out, are hiking up oil prices. In some cases, it's every man for himself.
Much of this has not gone on without notice. Most of us are suffering immensely from the gas crunch, which has not only affected gas prices, but also the cost of food and services, and the rise in unemployment. The party to immediately pay for the brunt force of this mess will most certainly be the Republicans, but the Dems won't be too far behind. They're in collusion with oil companies as well, despite their harsh rhetoric of imposing tax restrictions on oil companies whose record profits are sending more and more Americans to the welfare line. In fact, in Micheal Brush's article Why Politician's Are Worth Buying, "Though companies support Republicans more than Democrats ($43,000 per election cycle compared with $31,000, on average), they get a bigger payoff by supporting Democrats...outperforming the market by 3 percentage points a year, on average." Translation? Oil companies love Democrats too?
To prove my point, the Democrats are now in power, and yet it seems as though they are taking a rather business as usual approach to our oil pandemic. Remember, oil companies are making record profits, and so our politicians who are beholden to corporate money, work for and pass laws that benefit oil companies. This is not a conspiracy theory. IT'S FACT!!! And Democrats are no different than Republicans in usurping our Constitution in order to line their pockets with these record profits.
According to 1960sFlashback.com, the price of gasoline in the mid 60's was 30 cents a gallon. That's right, three silver dimes would have bought you a gallon of gas. However, if we take a careful look at the metal value of that silver, what we'd find is that those same 1960's silver dimes are valued at around $3 today, according to current silver standards. Silver was $1.29/ounce in 1964, and today's spot price is $12.93. If anything, the price of gas today is cheaper than it was in the 1960's, especially if we apply the gold standard, which would set the price of gas per gallon at $5.55 (Kitco). So, it has a lot to do with the value of precious metal and not so much a weakening dollar, contrary to public opinion. Besides, the dollar is no longer valued by precious metal standards as it once was, and therefore it is basically worthless. Thanks to my good friend Rana for reminding me of this.
So why was gas so cheap for so long and why the sudden rise? Most of our presidents have successfully lobbied OPEC to keep gas prices down, and it helped that the U.S. is the largest consumer of oil (21 million barrels a day). In fact, having traveled to Europe three times in the 1990's, and having worked there once, I discovered that Europeans were spending on a liter of gas what we were paying for an entire gallon. The average cost for a gallon of gas in Europe today is $8.70 (TIME). However, President Bush sees it as mutually beneficial to himself, a life-long oil man, and his Saudi Royal family, to bring us to those same levels of the 1960's, if not higher.
Wait! There's more. Our government, speculators, the media also have different opinions as to why oil prices are climbing. Some say it's a lack of supply, others say it's a weakening dollar, while others believe it's China's fault. Suppose all of these things are collectively true. What we'd still fail to recognize is that we have become inherently addicted to oil, and will not move our focus to greener, renewable sources of fuel until it's too late. Nor will we CONSERVE! As outlined years ago in Micheal Ruppert's book Crossing the Rubicon, oil production has reached a plateu, yet demand is steadily rising. At some point, demand will surpass production driving the price of fuel far higher than we can currently imagine. I need not scare you with the grim details of what will happen globally when this takes place, but rest assured, it's catostrophic.
Yet, I'm not as cynical as Marc Stephens who believes the government is doing it to keep our focus off of the war in Iraq and also to continue printing "fake money," though he may have something there. But oil is a limited resource, and the value, which follows the old adage, supply and demand, will only go up as that resource lessens. Oil rich countries, though they won't admit it, are beginning to run out of oil (Peak Oil.) In fact, according to David Stahan, author of the Last Oil Shock, "There are currently 98 oil producing countries in the world, of which, 64 are thought to have passed their geologically imposed production peak, and of those, 60 are in terminal production decline." With that said, it seems clear that countries, whose dominant resource (oil) is about to run out, are hiking up oil prices. In some cases, it's every man for himself.
Much of this has not gone on without notice. Most of us are suffering immensely from the gas crunch, which has not only affected gas prices, but also the cost of food and services, and the rise in unemployment. The party to immediately pay for the brunt force of this mess will most certainly be the Republicans, but the Dems won't be too far behind. They're in collusion with oil companies as well, despite their harsh rhetoric of imposing tax restrictions on oil companies whose record profits are sending more and more Americans to the welfare line. In fact, in Micheal Brush's article Why Politician's Are Worth Buying, "Though companies support Republicans more than Democrats ($43,000 per election cycle compared with $31,000, on average), they get a bigger payoff by supporting Democrats...outperforming the market by 3 percentage points a year, on average." Translation? Oil companies love Democrats too?
To prove my point, the Democrats are now in power, and yet it seems as though they are taking a rather business as usual approach to our oil pandemic. Remember, oil companies are making record profits, and so our politicians who are beholden to corporate money, work for and pass laws that benefit oil companies. This is not a conspiracy theory. IT'S FACT!!! And Democrats are no different than Republicans in usurping our Constitution in order to line their pockets with these record profits.
posted by Caleab at 11:00 AM
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