Oil Dependency: Auto Manufacturers, Lobbyists, & Consumers to Blame?

I know so very little about the 70’s being as I wasn’t cognizant until two decade later, but in talking to a friend most recently I realized there could be some very insightful lessons to be learned from history. More specifically my friend recalled the 1973 energy crisis and said she felt as if she was living in deja vu. She remembered in the 1970’s people were suddenly made very mindful of their dependence on oil and the need to find other means of energy. There was a variety of conservation and efficiency measures embraced as a way to dull US dependence on foreign oil. She recalled highway speed limits being set at 55mph, the ending of the gold standard (Bretton Woods Accord), oil embargos in the Middle East, price controls and rationing, the beginning of daylight savings times and the birth of the Department of Energy.

The scenario sounded all too familiar and gave little hope to my far flung dreams of America being energy conscientious by 2012. Having vague memories of talking about some of this stuff in college, I dug back into my history books and websites. I came to find out that in 1975 Congress imposed the Corporate Average Fuel Economy standards, better known as CAFÉ in which every automobile was to get 27.5 mile per gallon fuel consumption. Even Daytona and NASCAR shortened all their tracks by 10% in light of the crisis. It was a time were America as a collective realized we wanted and needed change. Some recall this time as a crisis and something to be avoided in the future. Yet, I had a hard time finding out where the crisis ended? At what point did our dependence on foreign oil and fossil fuels end?

It seems to me that 1970 was a waking point at which people had the ability to change the world from that point on. So why didn’t anything change? The problem seems to be farther reaching and in global crisis mode now more than ever before, yet there has been no collective effort from the American people or Congress to make any more major differences. Today we face global climate change, global competition for oil and access to oil as well as dwindling resources. It would be fairly easy to blame oil lobbyists or oil conglomerates for pressuring congress into few regulations like the CAFÉ, but it’s just as easy to point to auto manufacturers for their insistence on building SUV’s and gas guzzlers only getting 12-14 mpg. And American consumers are not without blame in this mix demanding ever larger and more impressive automobiles.

Our vehicles are nothing short of luxury homes on wheels these days and a large portion of people abuse the use and care of their automobiles. Bad business practices, bad policies, and bad habits have driven us (literally) into an even tighter position than in the 1970’s. Taking stock of the scenario it’s fairly easy to rationalize ringing your folks and barreling down the phone “THANKS A LOT!!” Yet, until we are able to create real change and demand differences it’s hard to lay fault or blame. When we had the technology and ability 30 years ago to create electric powered cars and fuel efficient vehicles it’s really hard to stomach things like the past year’s Escalades and Hummer 3 that seem to scream from every crevice “I’m luxury for the sake of luxury in all my wasteful glory” and frankly it’s all I can do to keep myself from giving their drivers the finger.

It’s not that I’m a tree-hugging hippy; in fact I’m very much a conservative and pragmatic in every sense of the word. Yet, I want to know why things didn’t change some 30 odd years ago when they could have and why we are faced with even bigger problems now? The answer stood blaring in my face not two days later when I struck up a conversation with a fellow Coloradan at the Wal-Mart check out. Late at night in the Garden section we were both hoping to avoid the lines of the front checkout area, but got stuck with what felt like a 20 minute price check. Bob and I started talking about not liking to shop (big surprise right?) and the conversation eventually fell into gas prices. I said I thought the current plan to bail out the car manufactures was a bad idea and the quite, reserved man I had been talking to transformed before my eyes. He started spouting that people like me didn’t care about US jobs or businesses and I had no footing in reality. I quietly replied that if the auto manufactures had followed good business practices like they did in the mid 1970’s we would all being driving 40+mpg cars and he wouldn’t have to worry so much about the five dollar price difference the store attendant was looking into for him. At which he shouted back that the American infrastructure is built around oil and Americans will never be able to break their dependence on oil. With that our conversation ended.

Clearly a product of the 1970’s I pondered hard on what Bob had offered. Did people really think that oil was the only answer and that was all cars could run on or factories could be powered with? I had to give credit to the fact that much of the infrastructure right now including gas stations, fueling pumps and other amenities were for oil, but you would have a hard time convincing me none of that has changed since 1973. We had our chance to change how things were done and invest in alternative methods of energy then, so why didn’t it change? The answer; because people like Bob didn’t believe they could fuel change or bring about a better system. A part of them probably didn’t want to be inconvenienced by change or invest in maybes. All sound and rational choices, yet the product of those choices is clear today and American’s have started to realize that real change is still needed.

It’s a choice the auto manufacturers will have to make, and congress, and every single individual American. We vote with every gas purchase, we vote with our auto purchases, and insurance coverage, we vote with every election and we each have the ability to be part of change. The first step is simply to believe we can…perhaps Obama had it right all along. It’s take a change in your mind frame and dedication to that change…it takes a mentality like “YES WE CAN.”

Political Rumors Dispelled

Right before elections I wanted to do a blurb on political rumors floating around, but alass time has never been my friend (and I have a job). So, here is what little time allowed me and time premitting I'll throw some more around before the year is out.
Rumor #1 Terrorist will be dancing in the street if Barack Obama is elected as the next President of the United States.
This rumor was circulating long before John McCain mentioned something to this effect in the second presidential election. However, when John McCain brought it up he was referring to Obama’s diplomacy policy when talking to nations that US relations have been less than friendly with. The Bush doctrine used to follow the same ideology as McCain’s (Don’t talk to anyone we don’t like). However, after years of worsening relations with countries like Venezuela, North Korea, & Iran even the Bush administration has started low level diplomatic relations with these countries to ease the tension. In sum McCain was saying that terrorists would favor Obama’s diplomatic policy that has already been accepted and put into practice by the Bush administration. So, what McCain was talking about in the second presidential election had very little to do with Obama being elected or terrorists doing the salsa. Understand that terrorists are a lot like delinquent teenagers, they lash out at the things they think are unfair in life and have little-to-no respect for others. The only exception is that terrorists are so beyond rational thinking that they are willing to kill to get attention, unlike a teenager who may just graffiti a public building or get into lots of fights. So, regardless of who is elected they will “dance” whenever they can and/or whenever they think we are doing something stupid. There is no doubt in my mind, when Bush leaves office they will “dance” regardless of who is elected to the presidency just because he is “the bad guy” right now.

Iraq Better Chums With China Than US?

In our greasy and overcrowded college canteen I watched as US marines made their way across Iraq in an operation called Iraqi freedom. Nine months before that I watched the course of history (and my future) change forever when two airplanes crashed into the New York stock exchange during first period Family and Health Class in high school. How these two events were linked was anyone’s guess. The terrorists of 9-11 had been founded by Wahhabism from Saudi Arabia and had based themselves in Afghanistan. Iraq was a whole separate issue and we knew it, even in college I was perplexed by the strong of events and circumstances that supposedly tied them together. Operation Iraqi Freedom seemed to say that we were fighting for the freedom of others (although we weren’t sure they wanted it) yet when our first act was to secure the oil fields there were questions raised. And others doubted whether Bush junior wasn’t just trying to complete a job his father didn’t finish. (i.e. ousting Hussein) There were and still are at least one solid truth; there are terrorists out there seeking to end the lives of American’s. Why Iraq then? Major game-changing questions aside, we go to war and hundreds of American’s sacrifice their lives for Iraqi democracy, we pour loads of money into their government system in hopes that they will stabilize and we can head home victors. Meanwhile the government and every other contractor involved is secretly hoping our extended stay and willingness to embroil ourselves into the countries affairs will bring us closer together. And it has in many ways been a golden opportunity for oil companies to create stronger ties with Iraqi representatives and for business to make lasting connections that will better the economies of both nations. Unfortunately the opposite has been true. The thought of doing business in Iraq would send shivers down any business man’s spine and the oil companies haven’t faired much better. Most recently the Iraqi government signed an agreement with China to drill their oil fields and help them manage their expansive oil market. China!! In the eyes of every security analyst there could be no worse insult. Russia has long been a saber rattling, but hollow threat and North Korea has finally agreed to nuclear inspection again. China is the only country whose technology is slowly encroaching on our own and their economy continues to be a force of reckoning. Did I mention how large their population was or how expansive their military is becoming? So when after years of American sacrifice and funding, the Iraqi people turn to China for assistance with their coffers, it’s easy to imagine Cheney having a small corollary over this scenario. The irony was not lost on me. For me, it serves as yet another reminder that the Iraqi people can make their own beds and dig their own graves…we gave them the freedom to do that and for that we should be proud, but this so-called relationship we have with the Iraqi people is no longer mutually beneficial let alone amicable.

US $700 Billion Not For Bailing Out Bad Loans?

From the start of this bail-out (Save Our Sorry bums) plan, we were leery of such drastic measures. Such a risk would put our children’s children in debt and there was still the risk it wouldn’t be able to do what it needed to. Congress bickered and the only logical explanation we could come up with was eventually these bad loans would have to be repaid and the American people had a shot at getting some of this money back. So, understanding the reasons behind why we went forward with this plan you can also imagine how shocked I was to learn that not a month later the treasury had decided to use the money for other purposes. I’m a little frustrated that Congress could hand off such a huge sum of money with no strings attached. When I read the $700 Billion Bail Out plan’s rough draft the language didn’t seem to say “here take this money and do whatever you want with it.” In fact, I remember specific sentences referring to “the buying of bad loans” and “for the purposes of alleviating major US financial markets.” Does the treasury have so much power and influence in today’s chronically anxious financial markets that they can decide to do whatever they want with $700 Billion? Now is seems US Treasury Secretary Henry Paulson thinks the money would be better spent buying up company stocks and selling federal bail-out bonds. I’m not to sure how I feel about tax dollars being used much like private equity to prop-up banks without requiring them to reform their practices. I think the most disturbing twist to this tale is that credit card companies and other lenders like those for student loans are now included in the mix. Oddly enough, I’ve never seen any report saying the credit card companies were hurting. I thought the opposite was true…people can’t pay their credit cards so they start piling on credit card debt and the card companies benefit from the interest incurred. Frankly I’d rather see the government bail-out car manufactures than credit card companies. I’m just wondering how we made the bank crisis into a credit card crisis? The two are linked so intricately that if you were to save the banks, you would be ultimately saving credit card companies too. Mr. Paulson mind explaining the rational there?

BBC Business Editor went so far as to say these new bail-out bonds were akin to the Chinese nationalizing of the private sector. I agree with him completely. The US government has never entered it’s self as an entity into the private sector for fear of losing impartial judgment. Buying up company stocks puts you past the line of impartiality and running towards nationalizing of businesses. The Central Bank has enough power to bend the economy, I guess I’m just trying to find where the balance is here? As part of these new bonds the Treasury is suggesting the US shares would have no voting rights and simply be a privileged share holder yet board voting is the last thing businesses would have to worry about with huge government stock investments. If the market were to drop below it’s current position the government could lose all of it’s original investment and we would be that much further in debt and conversely, what happens if the market rebounds? How much with government shares be allowed to make before selling off their shares. If and when they do sell these shares will the company lose its stability and acquired reputation for having a government secured position. Will government contracts be more likely to use businesses with government funding? This is new territory for business and the US government alike. In a strange twist of irony, maybe we would be well served to observe how the Chinese government handles these matters? Whatever the case, the new power the US Treasury seems to be vested with is compromising to say the least. Hopefully the newly elected president and congress members brought a few financial buffs with them to sort this out and provide some checks and balances here! There could be definite positives of having a trust funding government but on the same regards I don’t think we can sacrifice what little transparency and fairness our government system contains for business.

Check out this awesome Credit Crunch TIMELINE put together by the folks at BBC!

America: The Land of the Free & Brave

I read an interesting article a few weeks ago from a recent CNN poll saying that 75% of American’s are upset, angry and/or scared over the direction our nation going. There is a lot of negative media out there right now and public anxiety over our economic situation. And I have to readily admit; even though I am relatively financially secure the recent economic worries have me scared about things that I would otherwise ignore. Is my job stable? Do I have enough in savings to support my family if I lost my job? What if inflation continues rising like it has at 6%? Will my wage increase with inflation? The questions are endless and I often find myself frustrated and sometimes even shouting back at the morning news. I’m frustrated that when I graduated college, all the lenders I wanted to consolidate with had closed their doors in the misted of the credit crunch. I’m frustrated that my student loans are due, but the suppressed job market has kept me from getting a job in my field. Yet, in the same breath I am proud and thankful to be an American. Because while we have our problems from time to time and we seem to be constantly arguing about something amongst ourselves, at the risk of sounding cliché I still believe America is the best nation in the world. And above all else, I think the American people are what make America such an amazing nation. I’d like to give you some examples of how amazing America is and how amazing the American people truly are…

1. As individuals we give more to developing nations than any other country or countries’ people. Even in 2003, less than two years after the US was attacked by foreign terrorists, the American people send $62 billion overseas through non-profit organizations and other international aid organizations. Not to mention the $51 billion of US private capital that flows to foreign countries through foreign direct investments and net capital. (This creates jobs, economic growth, and solutions to poverty for millions.) Furthermore, American’s obsession with accountability and effectiveness often means that our aid & support is some of the most quality aid provided according to a study by the Index of Global Philanthropy. Another Washington research group found that US giving exceeded $95.5 billion in 2005. And what’s more the US government gives more in foreign aid than any other county per our Gross National Index. ($23.5 Billion in 2005) http://www.hudson.org/index.cfm?fuseaction=publication_details&id=3712
http://www.america.gov/st/washfile-english/2007/May/20070524165115zjsredna0.2997553.html

2. America is the largest cultural mixing pot. Yes, there are always going to be enclaves of different ethnic groups and stereotypes among every ethnicity, but on the whole we are an accepting and understanding nation. I would point to our counterparts in Europe and the many problems they are having with terrorism as an example of the openness Americans have in comparison. The immigration laws in much of Europe are much stronger than our own regulations making it much harder to immigrate. Also, many European cultures are not as open or accepting as the overall American perspective. This has made it hard for many European immigrants to integrate into European societies. This in turn leaves many ethnicities feeling discriminated against and ostracized; leaving fertile ground for terrorism and other extreme actions. The events following September 11th, 2001 are evidence of this. As London has seen domestic terrorism on the rise and an increasingly frustrated Muslim populist, America has enjoyed a great degree of peace. Proof positive that American’s acceptance of other cultures is much better than our European counterparts!
I think this openness and appreciate for other cultures is also evident in the American promise for freedom of religion. America has thriving, stagnant, and dying religious establishments, each according to the ability of its members to present a persuasive case. In some parts of America, there is a different form of religion on every block. While the comedians throw around jokes about every religion, we accept them all as part of the freedom of American choice. This brings me to my favorite American trait…

3. America is a nation of equal rights and freedoms. In any capitalist nation there will be vast socioeconomic differences and equal opportunities is not something the American system has been able to conquer yet. However, every man/women/child has the same rights and freedoms just for being an American. As a woman, I have the right to go to college, get a degree and work in any position I can dream of….and if someone tries to deny me those rights I can sue them!! (Mock us if you will, but some of our past and present civil rights lawyers have made it into my list of heroes right along with war veterans and political leaders…take for example Barrack Obama!!) The American legal system can be slow, arduous and at times seemingly backward, but it works. It works so well, other countries send their legal experts to learn from us. Those problems that do exist have a way of working themselves out over time and the US code of laws have been constantly evolving with the American people since its birth. As our needs change, so do the laws. Nevertheless, our rights and freedoms stay firmly routed in the American constitution where they continue to be the foundational strength of our great nation.

4. Our willingness to protect our rights and the rights of others. During the past 2008 Olympics in Beijing Americans traveled hundreds of miles and risked Chinese prisons just to protest the human rights conditions in China. As I’m writing this Californians are standing in traffic to protest proposition 8 which banned gay marriage. In all of these protest there existed people who had/have nothing to gain from protesting. They risk their clean records and sometimes more just to stand up for the rights of others. The best example I can give of service to others and our great nation is our veterans. Who had little to gain from joining a war and everything to lose but fought for America so that we could keep the rights and freedoms we aspire to as Americans. I raise my hat to those men and women who served our country and continue to serve abroad and at home. Their willingness to serve their country is a sign that American’s are willing to stand up for the freedoms and liberties we appreciate everyday. That is every sense of the word America is worth fighting for. A new hero of mine today is a man named Anthony Acevedo who I read about in a CNN article. Our veterans of old wars are dwindling and we already have new veterans in the making, but what many of us forget is the shear sacrifice with which they serve and why. The lessons we have to gain from them are endless and the stories they have to share are priceless. To often wars are grim and not many want to remember them, but veterans have more to tell than horror stories. They can tell you about the people they met, the families they saved, the country that supported them and how the American dream is touching lives beyond it’s borders.

5. Strong Civic Responsibility. America has always had different ways of showing our civic pride and patriotism. In the 60’s it was your civic duty to rebel against the status quo and smoke a joint. Today, civic responsibility takes a variety of forms; educating yourself on which candidate to vote, volunteering for a community clean-up day, or simply pledging to recycle more. American’s have proven time and time again that they believe anyone can make a difference and indeed people do every day. What I valued most in my adolescence and still today is the freedom to question our government and hold them accountable for their actions. It is our right and duty as American’s to question how our government works and why, to ask those hard and sometimes laborious questions. Our leaders and politicians are held accountable every election and through the checks and balances our system has setup. . In college one of my professors gave me a sticker with the iconic Uncle Sam pointing at you with an American flag in the background that said “Your Government Needs YOU to Question Everything.” I took that saying seriously then and still do today…it is the American way. We may not agree with everything our government does, but it’s our duty to speak out because the American government is only a reflection of what we ask it to do. Senator Ted Stevens may disagree, but our nominated and elected officials are all accountable to someone and the someones are always held accountable to the American people. We have a long list of indictments and congressional oversight commissions to prove it! 

Rhetoric vs. Reality

As we transition to a new president in the coming weeks, long term speculation over the economy sent stock prices down to their lowest points this year and ultimately their lowest point in 5 years. We arguably can still avoid a long-term recession, but the reality of an economic recession is all around us. More jobs were lost and large companies reported earnings in the red for the third fiscal quarter and outlook for the fourth quarter looks even worse. The most disturbing things, however, are not the things we know but what we don’t know. (Isn’t that always the case?)

With new president elect Barrack Obama already starting to plot his game plan, the financial industry is in stitches watching his every move. According to CNN and top representative Rahm Emanuel, the new president will be trying to shake things up from the first day. And the quickest way to do that is by repealing some of the presidential decrees and executive orders Pres. Bush had in place. As well as moving around some key players in nominated positions. There is already a great deal of buzz about who the new Director of National Intelligence will be and who Barrack might look to for Director of the Central Intelligence Agency. Surprisingly, a large number of executive orders during the Bush administration were about national security matters, foreign surveillance programs and other issues surrounding the war on terror. Many of those executive orders in question also deal with the Patriot Act, a much protested program that has had worldwide implications.

At the same time as Obama’s staff and officials are examining every executive order created by the Bush Administration; Bush aids are trying to push through 120 more executive orders on everything from repealing CO² emission limits for companies to allowing offshore drilling in areas previously banned. The measures are mainly aimed at trying to lighten regulations for companies in order to provide them with financial perks that could help them during these economic hard times. I join a long line of critics in saying these roll-backs come at the expense of ecological detriments. They also take a top-down approach to economic relief that the Obama campaign has been firmly opposed to. So, those roll-backs that are pushed through might be short-lived at best if the Obama Administration holds true to their promises for more environmentally friendly legislation.
Ironically, one of Obama first moves (even before sitting the oval office) has been to support a financial aid package to large businesses and corporations. This strikes me as an odd move for a man who recently campaigned with a bottom-up approach to government relief and tax aid. While I understand the immediate need for economic relief to the US’s industrial giants, I just hope our overshadowed environmental achievements won’t be forgotten in the mad rush to save Chrysler, GM & Ford.

YES WE CAN!!

Two days after the election and I'm breathing a sigh of relief. There were so many emotions riding in this last election I feel like I just got out of a bitter divorce, only the real fight is just beginning! For the moment I'm giving in to political apathy and taking a break from the over inflated media hype.
I'm enjoying that my stomach doesn't clench-up every time an ad comes on and I even started watching the morning news again. Save for Madonna's divorce, I feel as though the universe has come back to some sort of fine balance. The question now is what will/can Obama do to fix the mess America seems to be in?
I was talking to a close friend from Germany not long ago and she feared that if Obama hadn't been elected the markets would crash and Europe would resend back into the dark ages. Not sure how much credence I give to that sort of thinking; we would all continue to muddle on no matter who was elected, the question was just how and in what direction we were going to muddle in.
I did prepare a small write-up before the election about debunking political rumors, so I'll throw that up just for laughs. Otherwise, I'm looking forward in my own life and planning many a things.