Thursday, July 17, 2008

Republicans And The Economy-- Like Oil And Water


When two oilmen, largely financed by the Oil Industry, took over the presidency, the average cost of gas at the pump was $1.52. Back then it used to cost me about $20 to fill up my car. On an average type week I use about a tank of gas, so I was spending a bit less than $1,100 a year on gas. Today I filled up that same car and it cost me nearly $70 because gas costs $4.89 at the cheapest station in my part of town. If gas stops going up-- which is unlikely-- gas will make a much bigger dent in my budget: a bit over $3,600. Thanks to the Bush Economic Miracle there has been a massive transfer of wealth from consumers to... to who? The oil company executives who financed Bush's and Cheney's careers? Arab terrorists? It's not the guy who operates the gas station. This morning's Washington Post features a column by Harold Meyerson looking and the Bush-McCain economic agenda and can't get beyond "voodoo economics."
McCain comes before the electorate doctrinally adrift.

By his own admission, McCain has never been a student of the economy-- but neither have any number of American presidents. When the economy is humming along, their economic illiteracy has been a problem they can elide. They take refuge in the economic bromides of the time. Their speeches are filled with reaffirmations of their party's economic doctrine.

But as McCain tries to balance the tattered libertarianism of Reaganomics with the financial exigencies of the moment, he and his campaign have moved beyond inconsistency into utter incoherence. He vows to balance the budget while also cutting corporate taxes and making permanent the Bush tax cuts for the rich-- even though the rich and corporations made out like bandits during the Bush "prosperity," while everyone else's incomes stagnated. McCain squares this circle by vowing to cut entitlements, a move that would reduce, rather than enhance, consumer purchasing power at a time of economic downturn (or any other time, for that matter).

Whether Americans are even experiencing a downturn has been a matter of some dispute in the McCain camp, since former senator Phil Gramm, until last week one of McCain's chief surrogates on economic issues, deemed America a nation of "whiners" mistaking subjective insecurity over the economy for an objective economic fact. For McCain, who had the misfortune to be campaigning in Michigan the day that Gramm's remarks dominated campaign news, Gramm's insensitivity was appalling. But McCain has never expressed any concern that Gramm wrote the legislation that enabled the $62 trillion credit default swaps market to remain unregulated, which, as David Corn documented in Mother Jones, meant that banks and hedge funds could accumulate liabilities that they could not cover if the markets-- most particularly, the subprime mortgage market-- went south. To the contrary, McCain has viewed Gramm as one of his economic gurus. "There is no one in America that is more respected on the issue of economics than Senator Phil Gramm," McCain declared in February.

On Tuesday night Harry Reid filed a hodgepodge bill filled with proposals meant to get oil futures speculation back under control. Republicans won't budge from their position of allowing more off shore drilling, even though there are millions and millions of acres that oil companies are already leasing where they aren't drilling. (Bribe-choked oil industry-allied Blue Dog Democrats have joined with Republicans to defend Big OIl and prevent passage of a use-it-or-lose-it bill in the House.) They refuse to talk about anything but "the law of supply and demand" and insist that speculation in oils futures isn't a real part of the problem. Their spokesperson-- and I'm sure this is just a peculiar coincidence-- is the senator who has taken the most contributions from Big Oil this year (other than John McCain, of course)-- John Cornyn (R-TX- $803,200).

Reid is insisting that the Senate reverse the Republican deregulation agenda, which has wreaked so much havoc on the economy, and empower the Commodity Futures Trading Commission to increase transparency and limit market speculation. Perhaps some of the Republican groups that want to see runaway speculation (and oil prices), like the airline industry need to take a page from the AMA and threaten Cornyn's re-election bid to get him to support their demands. Fact of the matter is that both Republican and Democratic pollsters are reporting that the public wants speculation curbed-- and they want it curbed now, regardless of how many bribes the Oil Industry has given John Cornyn, James Inhofe (R-OK-$301,800), Steve Pearce (R-NM-$201,434), Mitch McConnell (R-KY-$230,900), Mary Landrieu (D-LA-$247,200), and Pat Roberts (R-KS-$156,100) this electoral cycle.

John Boehner (R-OH), who has accepted $185,000 in bribes from Big Oil since being elected to Congress, poo-poo's the whole idea of speculation. Caught by reporters between golf games he barked that "it's just another excuse not to drill. Without speculators, you have no liquidity in these markets. You want to bring more transparency to the market? Fine ... But all this other chatter that's going on is reckless and will have no impact." Boehner's clueless Ohio constituents keep returning him to office and wonder why their home equity values are at 1991 levels and why their cars cost so much to fill up and their family member's jobs are in jeopardy. Boehner got 64% of the vote in 2006 in his suburban/exurban district in western Ohio. This year he has raised, mostly from corporate special interests, $2,399,951, to fight off a challenge from Nick Von Stein who has raised $16,159. Maybe Congressman Boehner should spend less time on the links and more time listening to the American people-- or at least to some traditional Republican constituency groups. Tim Evans, in CitiGroup Futures reports that "with the latest push to the upside, we see the crude oil market becoming even more completely divorced from any connection to fundamental factors and becoming even more obsessed with the simple question 'how high can it go?'"
The Stop Oil Speculation Now coalition is a diverse and growing organization of industries, businesses, labor groups and ultimately concerned citizens united in support of responsible energy policies and prices. The coalition includes: ABX Air, Inc., Aerolitoral, Agricultural Retailers Association, Air Canada Jazz, Air Carrier Association of America, Air Line Pilots Association, International Air Transport Association, Air Wisconsin, Aircraft Owners and Pilots Association, AirNet Systems Inc., Airports Council International - North America, AirTran Airways, Alaska Airlines, Inc., ALMA de Mexico, American Airlines, Inc., American Association of Airport Executives, American Bus Association, American Eagle, American Moving and Storage Association, American Society of Travel Agents, American Trucking Associations, Association of Corporate Travel Executives, ASTAR Air Cargo, Inc, Atlantic Southeast Airlines, Atlas Air, Inc., Cape Air, Cargo Airline Association, Chautauqua Airlines, Inc., Colgan Air, Inc., Comair, CommutAir, Compass Airlines, Continental Airlines, Inc., Delta Air Lines, Inc., Delta Connections, Empire Airlines, Era Aviation, Evergreen International Airlines, Inc., ExpressJet, Federal Express Corporation, Flight Options, Frontier Airlines, Inc., Gasoline & Automotive Service Dealers of America, GoJet Airlines, Grand Canyon Airlines, Great Lakes, Gulfstream, Hawaii Island Air, Hawaiian Airlines, Horizon Air, IBC Airways, International Brotherhood of Teamsters, JetBlue Airways Corp., Mesa Airlines, Mesaba Airlines, Messenger Courier Association of the Americas, Midwest Airlines, National Business Aviation Association, National Business Travel Association, National School Transportation Association, New England Airlines, New England Fuel Institute, Northwest Airlines, Inc., Petroleum Marketers Association of America, Piedmont Airlines, Inc., Pinnacle, PSA, Regional Airline Association, Republic Airlines, Salmon Air, Scenic Airlines, Shuttle America, Skybus Airlines, Skywest, Southwest Airlines Co., Spirit Airlines, Inc., Trans States,, Truckers and Citizens United,, Twin Otter International, United Airlines, Inc., United Motorcoach Association, UPS Airlines and US Airways, Inc.

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At 9:45 AM, Anonymous Anonymous said...

If you remember the bumper stickers: W04, they meant to say
W, oh, $4 gas; but you have to save money somewhere!

At 10:57 PM, Anonymous Kandukuri Kishore said...

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