by Morgan Johnson

Created on: October 11, 2008   Last Updated: October 05, 2011

It's the OIL, Stupid!

The world is in a financial freefall. Markets from New York to Tokyo have lost one-third to one-half of their value in the past year. Companies are closing, people are losing their jobs and governments are trying to prop up their economies. The torches are out and the mob is looking for someone to blame.

The media is currently blaming greedy CEOs of the corporations. Before that, they were after the heads of Fannie Mae and Freddie Mac. The Liberals are, of course, blaming Bush, but then they blame Bush for everything that has happened since the American Civil War. It's called BDS (Bush Derangement Syndrome).

What everyone is missing is the common key that has turned the screws on all of the economies across the world - oil!

The price of oil has been artificially high since late 2006. Oil speculators bid the price of oil through the roof without bothering to justify the increases.

The cost of gas delivered the final blow to the Republican dominated Congress and brought Nancy Pelosi to power.

Rep. Pelosi promised to protect the American people from greedy oil companies and to bring prices down from the ridiculous high of $2.80/gal! Have you seen prices that low lately?

Oil and gas prices have remained high for more than 18 months now. Most people cut back on travel, cancelled vacations, and limited errands. But the prices remained high.

Then people started giving up their cars, couldn't shop during holiday sales (important economic checkpoints) but the price of gas remained high.

We got our economic stimulus check from the government but most of that ultimately ended up paying for oil directly or indirectly due to rising prices. Eventually, we had nothing left to give up.

Now oil prices have fallen way off - minus 45% - but the price of gas is falling much slower over the same period - minus 18%.

It might be too late. Companies have borne high transportation costs for far too long. Those costs have ground into consumer prices at a systemic level. Companies have shaved profits to the bone and working class people simply don't have the disposable income to purchase anything but gas.

Right now the price of oil is down to $77/bbl. The last time it was that low gas cost $2.33/gal or less across the country. What are you being charged today?

The economy will rebound. We have too much built-in power to just fold up entirely. But I hope this will be a lesson to the American people.

We must finally see that we need energy independence.

We need to develop domestic sources regardless of the costs.

We need to continue to conserve fuel and develop alternative energy sources.

We need to go nuclear for our power grid. America invented nuclear power as a domestic power source yet we haven't built a new reactor in thirty years. That's insane!

The American people have had their final warning. The next time we fall under the bus there will not be enough government money to bail anyone out!

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