Log in

No account? Create an account

Previous Entry | Next Entry

Over a thousand servicemen dead in Iraq...

...and I'm still paying nearly $2.50 a gallon for gas? WTF is up with that??

So now the Bush regime has finally formally admitted that Iraq had no weapons of mass destruction (warinng--big-ass PDF download). None. Nada. Zip. I still remember watching CNN as Colin Powell heroically kept a straight face as he put on the WMD dog-and-phony show for the United Nations, waving around vials of confectioner's sugar and pointing gravely to flip-charts of Iraqui "mobile germ warfare laboratories" that, as it turns out, existed only in the fevered imagination of some of the CIA's tinfoil-hat brigade. I knew we were being duped; the rest of the world knew we were being duped; but the American public just ate this shit up and asked for more.

So. Here we are, sending people to die in the Middle East, for...um, no reason whatsoever. Weapons of mass destruction? Never existed. September 11? That was this guy named Osama somebody, not Saddam Whatshisface. Bringing stability to the Middle East? Iraq is more unstable now than at any point in the past hundred years. Securing ourselves from terrorism? Saddam Hussein was Al Quaeda's biggest enemy in the Middle East; with him gone, Iraq is now ripe recruiting grounds. One hundred and sixty billion dollars spent to date, and we have nohing to show for it except a bunch of cars driving around with lopsided "Support Our Troops" stickers on them.

And I'm still paying nearly $2.50 a gallon for gas.

Man, that's fucked up.



( 8 comments — Leave a comment )
(Deleted comment)
Apr. 5th, 2005 01:17 am (UTC)
When i was driving back and forth between Orlando and Tampa this weekend, I was paying $2.43 a gallon for the cheap stuff. Of course, those were "gas station just off the interstate" prices.

Hey, you guys busy tomorrow?
Apr. 4th, 2005 03:52 pm (UTC)
The war wasn't about providing low cost oil right now, or even about short-term profits for oil companies, Haliburton, et al, despite the frequent allegations to that effect... (of course, it was a "useful" side-benefit, from the perspective of neocons)

The invasion of Iraq was about control of resources and strategic military position in the region.

Though an invasion of Iraq had been planned since the mid-90s by the PNAC, plans were accelerated (with WMOD and terrorism as cover) after a 2000 decision by Hussein to accept only Euros for Iraqi oil contracts. This set a dangerous precedent for American interests, as the economic stability of the United States is almost completely dependent on the US dollar continuing on as the World's Resserve currency.

Since the early 70s breakdown of the Bretton Woods system and complete abolition of te gold standard in the west, governments have kept their currency stable by buying US dollars to hold as reserve in their central banks (or more properly, by buying US Bonds / notes). In the cold war era, this made a lot of sense, as the US was clarly the strongest western economy in the world -- a net exporter of high quality goods, rapid growth rates, solid national defense, etc.

Today, the US has record trade defecits amounting to 6%+ of GDP, and over 40 Trillion dollars in government, corporate, and consumer debt combined (that's around $500,000 per american household...). This debt figure includes "IOUs" made by congress to the social security and medicare trust funds, but not things like underfunded FDIC insurance, guranteed pensions, private pension shortfalls, etc. Meanwhile, all US assets (corporate, consumer, government) combined are estimated at about 37 Trillion -- in orther words, there's an overall "Net Debt" of about 3 Trillion, or $14,000 per person (roughly) -- $14,000 sounds like a lot, but isn't really that bad when you consider that it includes all consumer debt, federal debt and business debt combined (credit cards, mortgages, the works) -- but in reality, the asset figure is misleading....

IT's rather clear that the residential housing market is in the midst of a bubble in the country, but although residential real estate has been appreciating from 20-100% per year for the last few years (depending on geography, with a national average in the 20s), rents have remained relatively flat, indicating a likely bubble. When you consider that only 1/3 of home sales in 2004 were by those intending to occupy the homes, and all others speculative investments, the case becomes even more convincing.

The economy has continued along because of America's willingness to consume, and to finance its consumption with debt, in the absence of any real economic growth. The US has the highest rate of home ownership in its history, and the lowest rate of owner equity as a percentage of value, and lowest owner occupancy rates -- People have been taking out home equity lines of credit and spending the money on vacations, SUVs, etc -- and the real wealth isn't there to back it up.

If real estate prices were to fall even 20% (a modest drop, considering the recent gains), nearly a third of all real estate holders would be bankrupt. When you consider falling real incomes and adjustable rate mortgages making it harder to make ends meet, especially with the rising trends in intrest rates, the eventual outcome is clear -- either banks will fail, resulting in huge declines in stock and bond valuations (plus more federal debt to bail out depositors) or millions of people will be unable to afford their homes, resulting in massive foreclosures, and huge downward pressure on property markets, creating a viscious circle.
Apr. 4th, 2005 03:52 pm (UTC)

Based on these factors, I'd conclude that a more realistic estimate of US assets is 20 Trillion to 25 Trillion dollars -- in other words, the real debt is around $100,000 for every citizen -- or around $300,000 per household -- this in a world where household income averages around $50,000 per year... scary numbers.

As oil prices rise, these factors are exacerbated. The US can't pay its debts -- as a result, prices must rise, and we must have massive inflation to mitigate the other financial effects of the huge debt burden.

an OPEC shift away from US Dollars puts strong downward pressure on the value of the dollar, destroying wealth in the process, leading to higher short-term unemployment [even if it might be best int he long run], and making the potential effects of a housing price bust substantially more dire.

The US is not in control of Oil as a resource, but every industry is dependant on oil. The US needs to intimidate Middle-Eastern nations to maintain US Dollar reserves, and needs to be able to steal resources from other countries ( or appropriate them at a bargain basement price) in order to have any chance of repaying its debts -- imperialism and conquest is the only way out of a complete meltdown of the financial system.

An invasion of Iraq allows the diversion of resources (from Iraqis to Americans -- or actually, to large american corporate interests -- individual americans will become much poorer as a result of these actions...) and alos provides a strategic military staging point in the middle east, increasing intimidation of Syria and Iran, who have both ruminated about accepting Oil contracts in either Euros or Gold only... (Funny that rhetoric about Syria and Iran being evil keeps increasing....)

Any country's place as a reserve currency is limited in duration, and the US is arrogant to rely on perpetuation of the system as it stands (After all, it's only been this way for 30 years or so...), but ceasing a policy of conquest will result in a huge loss of wealth for individuals, and a rather substantial loss of wealth for powerful oligarchs as well... and "we" can't have *that*.

Even though militarism will mitigate some of the burdens faced by the US, countries are still moving slowly away from holding the dollar exclusively as a reserve currency, and eventually, the dollar must collapse, and hyperinflation will make all americans poorer. I wouldn't be surprised if this time next year, you were paying $2.50 or $4.00 for gas... IF you look closely enough, the policies and their ramifications are quite clear...
Apr. 4th, 2005 09:25 pm (UTC)
I pay $1.98.
Apr. 5th, 2005 12:03 am (UTC)
scary on other fronts!
Apr. 5th, 2005 01:18 am (UTC)
Re: scary on other fronts!
Ye gods. Now that's EXACTLY what I needed to read. :/
Apr. 5th, 2005 08:24 pm (UTC)
Re: scary on other fronts!
Yet another state to add to my "never move there, it's filled with idiots" list, I see...

Religious freedom means freedom from persecution, not freedom to persecute. - ZM
Apr. 6th, 2005 10:03 pm (UTC)
Well put.
( 8 comments — Leave a comment )