A Gasoline Conspiracy To Set Fire To The Obama Administration?
I’ve never been much of a conspiracy theorist as it is not my inclination to see evil lurking behind every bush (no pun intended.) More times than not, things are—for the most part—pretty much as they appear to be.
However, there is a strange anomaly occurring on the highways of America and in the boardrooms of some of our largest investment institutions that has caused me to consider whether a plan is afoot that, if successful, could represent the best possible strategy for ending the presidency of Barack Obama.
According to the Automobile Club of America, gasoline prices have risen, on average, 13.1 cents in the past month—despite the fact that gas prices traditionally fall in the month of February as people drive fewer miles during the wintery month.
What’s more, virtually every projection out there suggests that gas prices are about to make a dramatic rise to, potentially, record levels with some suggesting that $5.00 a gallon gas or more —double the prices of just a few months ago—could very well be in our future.
This becomes a particularly odd statistic when one considers that Americans are using less gasoline than they have at any time in the last fifteen years. Currently, we burn up 8 percent less gas than we did during the peak year of 2006 while most experts expect the trend to continue to where we will be using 20 percent less gasoline by 2030.
Says Tom Kloza, chief oil analyst for the Oil Price Information Service,
Strangely, the current run-up in prices comes despite sinking demand in the U.S. Petrol demand is as low as it’s been since April 1997. People are properly puzzled by the fact that we’re using less gas than we have in years, yet we’re paying more.
How can this be explained?
Certainly, concerns of a potential conflict in Iran, and the impact such an event would have on the world oil market, would drive prices up. Adding fuel to this gasoline fire are the seeds of uprising that are ripening in the eastern region of Saudi Arabia where most of the nation’s oil reserves are located.
And, to be sure, an improving domestic economy typically results in higher oil prices as demand begins to rise. However, experts seem to agree that even this will not return us to our high’s of 2006.
Experts agree that even when the economy rebounds from the recession, gasoline usage will remain below the 2006 figure, which should remain forever untouched barring any massive economic boom periods or drastic fuel price cuts. That reduction can be attributed to a number of factors such as higher fuel efficiency fleet figures for manufacturers, a higher use of hybrids, an increase in bio-fuels like bio-diesel and ethanol, and continued high gas prices, among other factors.
There has to be something else at work here.
According to Kloza, a healthy percentage of the increase is the result of speculative money flowing into gasoline futures contracts since the beginning of the year, mostly coming from hedge fund and big money mangers. “We’ve seen about $11 billion of speculative money come in on the long side of gas futures,” Kloza says. “Each of the last three weeks we’ve seen a record net long position being taken.”
These record positions that are driving up prices could certainly be the result of speculators’ legitimate belief that Middle Eastern instability and an improving economy at home make higher prices a good bet.
And yet, Middle Eastern instability is nothing particularly new. Even if speculators see an Iranian crisis putting more pressure on the oil markets than in days gone by, it is difficult to rationalize how this would result in a 100 percent increase in prices at the pump, particularly in view of the fact that we use less gasoline today than at other times of crisis.
While Wall Street’s ‘priority one’ is to make money, it is clear that, for this year, priority two is the destruction of Barack Obama’s presidency. Accordingly, from a Wall Street point of view, it certainly is a happy coincidence that that priority one, making big money on oil speculation, could directly lead to accomplishing their second highest mission.
I am left to wonder whether this is a happy Wall Street coincidence or a clever strategy that could pay off big-time come November.
Gasoline prices have a ‘real time’ impact on middle-class voters. Can you imagine a better way to make voters good and angry than to insure that they are paying five bucks a gallon for the gasoline that will be powering them to the voting booth in November? And if you subscribe to the theory that the President’s opponents would like to keep economic growth down until the election is over, what better way to accomplish such a goal than to force a precipitous rise in gas prices?
Maybe what we are seeing is nothing more than the natural and completely explainable reaction to events in oil producing countries and the promise of an improving domestic economy.
However, when you consider that we’ve faced these uncertainties more than once in the past fifteen years, and combine that with the understanding that we are currently consuming less oil products than at any time during that period, it is difficult to come up with a rational explanation as to why gas prices would nearly double in so short a period under these circumstances.
Am I simply getting paranoid as the election season is upon us?
Maybe. But there is no disputing that the higher gasoline prices go, the lower the odds that President Obama will be returned to office for a second term.
So, I’m just saying’…..
As a result of what is coming, it might be a good idea for the Obama Administration to start talking about the reasons for rising gas prices and I’d start talking about it now. This is one instance where silence is anything but golden and without a plausible explanation as to why the Administration is not responsible for what might be a dramatic rise in gas prices, it may be Pesident Obama who is left holding the pump nozzle come December.
By: Rick Ungar, Washington Monthly, February 17, 2012
Economic Inequality And Tax Fairness: What Newt Gingrich Doesn’t Want Us To Talk About
Over the last three decades, wealth has become increasingly concentrated at the top. The middle class is struggling with stagnant wages and a growing class gap; poverty rates are soaring; the jobs crisis seems never-ending; and a growing number of Americans are suggesting it’s time for a larger conversation about economic inequalities and tax fairness.
Newt Gingrich believes that conversation must not occur. In fact, the Republican presidential candidate questions the patriotism of those who choose to draw attention to the problem.
“I repudiate, and I call on the President to repudiate, the concept of the 99 and the 1. It is un-American, it is divisive, it is historically false…. You are not going to get job creation when you engage in class warfare because you have to attack the very people you hope will create jobs.”
Even for a candidate who says truly ridiculous things on a daily basis, this is extraordinary.
Let me get this straight. A disgraced multi-millionaire, who’s run an ethically-sketchy “business conglomerate” while spending vast amounts of money on high-priced jewelry for this third wife, feels comfortable lecturing struggling Americans about even noticing the growing class gap.
And no one finds this disqualifying for national office?
When Republicans demand the middle- and lower-classes sacrifice, while shielding millionaires and billionaires from any concessions at all, the American mainstream isn’t even supposed to talk about it? When GOP policies impose a new Gilded Age on society, it’s “un-American” to even debate the propriety of the regressive agenda?
Since when is it consistent with the American tradition to try to shut down a debate over fairness and economic justice? For that matter, since when is it an “attack” on the extremely wealthy to ask them to pay Clinton/Gingrich-era tax rates that allowed the rich to thrive in the 1990s?
What’s more, let’s also not overlook Gingrich’s selective approach to unity. Today in South Carolina, Gingrich said it’s un-American and divisive to pit a majority against a minority. But as my friend Kyle Mantyla noted today, Gingrich said the opposite at the recent “One Nation Under God” event where he told religious right activists “that they are the majority in the country who must stand up and take this nation back from the ‘minority elite’ who are ruining it.”
So to recap, when it comes to the economy, Gingrich believes we’re all one people, and we must pay no attention to the wealth that divides us. When it comes to the culture war, we’re not one people, and those who believe as Gingrich does should target and defeat those Americans who disagree.
If a right-wing voice rails against the “minority elite,” he’s speaking the truth. If an Occupy activist rails against the “minority elite,” he’s an un-American radical.
Got it.
By: Steve Benen, Contributing Writer, Washington Monthly Political Animal, November 29, 2011
Job Creation: Small Isn’t Always Beautiful
I challenge you to find a stump speech by a politician running for any office from dog catcher to president that doesn’t invoke the importance of small businesses.
That’s not necessarily a bad thing. It’s a hat tip to American entrepreneurialism, evoking images like that of Steve Jobs planting a seed in his garage that grew into an amazing Apple orchard. Besides, don’t most people work for small businesses, and aren’t such businesses the engine of job growth?
Actually, no. In what may be the most misunderstood fact about the job market, although most companies are small — according to 2008 census data, 61 percent are small businesses with fewer than four workers — more than two-thirds of the American work force is employed by companies with more than 100 workers. You can tweak the definitions, but even if you define “small” as fewer than 500 people (as the federal government does, basically), you still find that half the work force is employed by large businesses.
It’s even more stunning when it comes to payrolls: 57 percent of total compensation is paid out by companies of 500 or more employees, with most of that coming from the largest, those with at least 10,000 employees. And new research by the Treasury Department finds that small businesses — defined as those with income between $10,000 and $10 million, or about 99 percent of all businesses — account for just 17 percent of business income, and only 23 percent of them pay any wages at all.
But don’t small businesses at least fuel job growth? Sort of. It’s not small businesses that matter, but new businesses, which by definition create new jobs. Real job creation, though, doesn’t kick in until those small businesses survive and grow into larger operations. In fact, according to path-breaking work by the economist John C. Haltiwanger and his colleagues, once they accounted for the outsize contributions by new and young companies, they found “no systematic relationship” between net job growth and company size.
It’s unlikely such findings will change politicians’ speeches trumpeting small businesses. But if we want to get our job market back on track, they should inform our policy thinking. For example, it’s not only the case that start-ups are of particular importance to robust job growth. They’ve been creating fewer jobs over the last decade. Employment at start-ups fell by almost half, and those losses predated the “Great Recession” — probably one reason job growth was so lackluster over the last decade’s expansion.
Economists do not yet have a good answer as to why start-ups and surviving young companies are creating fewer jobs, but it may have something to do with “allocative inefficiency.” Too many resources flowed to financial engineering in the last decade, and too few went to R & D and innovation outside of the financial sector. The decline of American manufacturing plays a role here as well, as the sector has historically accounted for 70 percent of job-creating private-sector R & D, often in partnership with start-ups and small suppliers.
This isn’t to say that public policy should abandon small businesses. Many face distinctive hurdles compared with large businesses: they have tighter profit margins and thus less room for mistakes, they have diminished access to credit markets and, even with creditworthy borrowing records, many say they’re not getting the loans they need. Small manufacturers often have less access to export markets, and, with emerging economies growing a lot faster than advanced economies, that’s a big disadvantage.
Yet the sector’s primary lobbying group — the National Federation of Independent Business — tends to fight less for these pragmatic policies and more for the standard conservative agenda of lower taxes and deregulation. Indeed, the group has become a purely partisan operation, fighting more for Republican electoral victory than small-business growth. For example, it opposed the president’s jobs bill, even though independent analysts estimated it would significantly increase economic demand, and the federation’s own survey shows that “poor sales” — a k a weak demand — is a much bigger problem for its members than taxes or regulations.
The next time a politician tells you how he or she is for small business (which will likely be the next time you hear a politician say anything), be mindful that to the extent that size matters at all for job growth, it’s really about new companies that will start small and, if they survive, perhaps grow large. Everything else is largely noise — and too often, noise that has little to do with what this economy really needs.
By: Jared Bernstein, Op-Ed Contributor, The New York Times, October 23, 2011
The Tea Party Chronicles
Raising Cain
Herman Cain, the former CEO of Godfather’s Pizza is rolling in dough and rising in the polls. A new national survey of primary voters by the Wall Street Journal and NBC News has the Hermanator in first place ahead of Mitt Romney and all the other Tea Party types. The question is whether working families will support Cain’s plan for a national sales tax to pay for lower taxes for bankers and billionaires? I don’t think so.
Don’t Know Much about History
The Tea Party takes its name from the Americans who dumped British tea into Boston Harbor to protest taxation without representation in 1773. The Tea Partyers profess great reverence for the founders but the Tea Party candidates are clueless about the founding of our nation. Tuesday Rick Perry placed the American Revolution in the 16th century which would have given our founders only a few years to get things rolling after Columbus came to town. Previously, Michele Bachmann described the founders as abolitionists, a portrayal which would have greatly surprised the hundreds of slaves owned by George Washington and Thomas Jefferson. By the way, Representative Bachmann, the Boston Tea Party, like the battles of Lexington and Concord, was in Massachusetts, not New Hampshire.
Greed is Good
Greed is good should be the motto for the Party of Tea, the party formerly known as the GOP. Tuesday, Every POT member of the United States Senate opposed the president’s proposal to reduce payroll taxes and provide tax breaks for small businesses which hire people without jobs. Why did the POT spit the bit on the issue that Americans care most about? Because Democrats would pay for the tax cuts for working families and small businesses by making millionaires and billionaires pay their fair share of taxes. Greed is good for the Tea Partyers and their billionaire buddies who bankroll their big budget campaigns. Because the POT blocks action in Washington on jobs, thousands of Americans occupy Wall Street and streets across the country to protest corporate greed. Will the numerical advantage that the 99 percent have triumph over the money muscle of the 1 percent. Yes, it will.
ObamaCares
Time magazine released a new national survey yesterday that shows Barack Obama beating all his POT challengers. The secret of the president’s success is Obama’s caring. A clear majority (57 percent) of likely voters believe that Barack Obama cares about the problems of people like themselves. It’s not surprising that Americans feel that the president cares about them when the Party of Tea goes out of its way to cut Medicare and Social Security benefits for seniors but fights to the death to protect federal tax freebies for bankers, billionaires, hedge fund managers, and corporate jet setters.
It’s about Time
The same Time magazine national survey indicates that two of every three Americans believe the rich should pay more taxes. Which explains why more than half (54 percent) of the likely voters have a favorable opinion of the protesters against corporate greed while only one of four people (27 percent) have a favorable opinion of the Tea Party. The Tea Party has been replaced by the new kid on the block. Far be it for me to give advice to Republicans but they better quickly take back their party from the extremists before voters dump the old GOP into the harbor with the Tea Party.
By: Brad Bannon, U. S. News and World Report, October 13, 2011
“We Are The Whiners”: About Those ‘53 Percent’
Republicans have been preoccupied for much of the year with those Americans who don’t make enough money to qualify for a federal income tax burden. Some are working-class families who fall below the tax threshold; some are unemployed; some are students; and some are retired. These Americans still pay sales taxes, state taxes, local taxes, Social Security taxes, Medicare/Medicaid taxes, and in many instances, property taxes, but not federal income taxes.
This, apparently, annoys the right to no end. It’s why all kinds of Republican officials — including Mitt Romney and Rick Perry — want to “fix” what they see as a “problem,” even if it means raising taxes on those who can least afford it.
This argument is even manifesting itself in a new “movement” of sorts, intended to respond to progressive activists calling for economic justice.
Conservative activists have created a Tumblr called “We are the 53 percent” that’s meant to be a counterpunch to the viral “We are the 99 percent” site that’s become a prominent symbol for the Occupy Wall Street movement. The Tumblr is supposed to represent the 53 percent of Americans who pay federal income taxes, and its assumption is that the Wall Street protesters are part of the 46 percent of the country who don’t. “We are the 53 percent” was originally the brainchild of Erick Erickson, founder of RedState.org, who worked together with Josh Trevino, communications director for the right-leaning Texas Public Policy Foundation, and conservative filmmaker Mike Wilson to develop the concept, according to Trevino.
The overriding message is that the protesters have failed to take personal responsibility, blaming their economic troubles on others.
There are all kinds of problems with the right’s approach here, including the fact that they seem to want to increase working-class taxes and also seem entirely unaware of the fact that it was Republican tax cuts that pushed so many out of income-tax eligibility in the first place. There’s also the small matter of some of those claiming to be in “the 53 percent” aren’t actually shouldering a federal income tax burden at all, but are apparently unaware of that fact.
But putting that aside, take a look at Erick Erickson’s argument, presented in a hand-written message posted to the Tumblr blog: “I work three jobs. I have a house I can’t sell. My family insurance costs are outrageous. But I don’t blame Wall Street. Suck it up you whiners. I am the 53% subsidizing you so you can hang out on Wall Street and complain.”
Just for heck of it, let’s take this one at a time.
The very idea that Erickson works “three jobs” is rather foolish.
Blaming financial industry corruption and mismanagement for Erickson’s troubles selling his house is actually quite reasonable.
If Erickson’s reference to “family insurance costs” is in reference to health care premiums, he’ll be glad to know the Affordable Care Act passed, and includes all kinds of breaks for small businesses like his.
And the notion that victims of a global economic collapse, who are seeking some relief from a system stacked in favor of the wealthy, are “whiners” is so blisteringly stupid, it amazes me someone would present the argument in public.
If there are any actual “whiners” in this scenario, shouldn’t the label go to millionaires who shudder at the idea of paying Clinton-era tax rates?
By: Steve Benen, Contributing Writer, Washington Monthly-Political Animal, October 11, 2011
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