Society and The Economy Should Be Viewed As Complex, Interdependent Systems, Not As Machines, Argue Authors Hanauer and Liu in “The Gardens of Democracy” – But Who Is The Gardener?

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By Paolo von Schirach

April 28, 2012

WASHINGTON – The interview on the Charlie Rose show broadcast on PBS (US Public Television Stations) and Bloomberg TV sounded intriguing. The two authors, Nick Hanauer and Eric Liu were there to discuss their new book “The Gardens of Democracy, A new American story of citizenship, the economy and the role of Government“. I found the two authors to be sincerely committed to an effort at making democratic capitalism truly democratic.

The trust factor

They fear that an economically polarized society is a more divided society in which there are fewer and fewer positive interactions and less trust among groups. And I believe that they are spot on when they argue that success is based on cooperation among different groups and individuals within them. And cooperation is certainly based on genuine trust. So, arguably low levels of trust yield little cooperation and therefore not much success. Improve trust and you will have greater success. I fully agree.

Not an engine

Where I am a bit lost is in their attempt to offer new definitions as to what are the true dynamics that make things happen. They argue that we are prisoners of old fashioned, mechanistic, linear notions of how society works and how the economy works. This is not an engine, and not clock work, they maintain. This is a complex system with lots of interdependencies that do not fit well within a mechanistic description that assumes hierarchies of relevance. Case in point, they say, it is absolutely not true that rich people with money deserve to be viewed as more important because they are investors/entrepreneurs and thus jobs creators.

No, they say, the real economic engine is the consumer, because without consumers buying things there would be no business activity. Here I pause and scratch my head. They had just finished saying that the hierarchical system that we believed to be true is a fallacy. And what do they do? They simply propose a different hierarchy, with the consumer at the center of things.

There should be no hierarchies

But the real point is the one I thought they wanted to make at the beginning. Society and the economy work through complex interdependencies. And so, by definition, there are no true hierachies –old or new. I fully agree that without consumers there would be no markets for corporations. But it is also true that without innovators capable of bringing new things to the consumers we would still live in caves, possibly eating raw meat and wild berries.

Innovators and consumers

Societies can advance because of innovators who, in our capitalistic system, are motivated also, (even though not entirely), by the prospect of making money. Not everybody is an innovator. Do we recognize and give value to innovators? I believe we should, if we want to have more of them. Of course the innovators/entrepreneurs need consumers. But consumers in turn need innovators in order to obtain products that enhance the quality of their lives. Indoor plumbing, central heating and washing machines do not exist in nature. Someone needed to invent them, perfect them and bring them to market.

The difficulty is of course is in striking a proper balance between producers and consumers. From this perspective, I fully agree with the authors when they talk about trust as the basis for cooperation and cooperation as the basis for success. This is a central theme articulated by them that warrants deep reflection.

A garden is not an ecosystem

On a different note, I found other definitions to be confusing. Hanauer and Liu argue that the economy is not a machine but an ecosystem of complex relationships. And then they proceed to ask: ”Which ecosystem do you want? A jungle, or a garden?” But, wait a minute. This is a totally inappropriate comparison. A “jungle” exists in nature and it is a self-sustaining and self-regulating ecosystem. A “garden” is man made, so much so that, as the authors state, it requires human agents in the shape of gardeners. Therefore, a garden is not an ecosystem.

So, in practice, the two authors deny the validity of their assumptions. They started by stating that the economy is a complex system which by definition should have no higher or lower parts and then they tell us which one is true higher part. And then they call a man made construct an ecosystem, while it cannot be because it it is premised on a human plan.

Indeed, depending on the inclinations of the gardeners, you can have a variety of different gardens: Italian, English, Japanese and what not. You can have a lot of trees, a lot of shrubs, a lot of flowers, etc. (Note: I often refer to an innovative economic environment as an “ecosystem”. But I do not use the term literally, only as a metaphor that illustrates the notion of complex interdependencies that establish some kind of productive balance in certain, hard to replicate, circumstances).

Authors have their predilections

Just by evaluating how they discussed their work, I sense that the authors, while well intentioned, have their own agenda, as clearly revealed by the use of the garden analogy. A garden presumes a plan, based on some predilections. If I allow these two authors to be in charge of the garden where I live, it is almost certain that they will create a garden to their liking, and not necessarily to mine.

Let’s be frank and admit ignorance

And here is where we should go back to what I believe to be their basic point, a point that, if truly shared as a basis for analysis, can actually bring people together. Society and the economy are complex systems made out of interdepedent parts. If we were truly honest, we should admit that we just do not know exactly how these parts work at any given time, let alone how they interact under different conditions and levels of stress. The extraordinary diversity of opinions among economists illustrates that most of the time we are just guessing, mostly groping in the dark.

So, what do we do? Well, let’s start with some humility. Let’s admit that we know very little about how to maximize economic efficiency with benefits going to the largest numbers of participants. Let’s observe the interactions among the elements, trying to better understand them, with the objective of proposing incremental improvements that –incidentally– may or may not be appropriate. Exchanging one model for another, on the basis of an implicit assumption whereby ”My model is better than yours” is not a good start.

Who’s in charge of the garden?

As for the garden metaphor: watch out, for it may be far less benign and poetic than it looks. The garden assumes a superior intelligence, the gardener, and helpless objects, the plants. They will be placed in that space according to the will, taste and judgment of the gardener. I have the uncomfortable feeling that in the construct imagined by the authors I may be one of those plants and that they fancy themselves as the capable gardeners. And I do not like the idea of being an object.




IMF Christine Lagarde Believes The Euro Has to Succeed In Order To Keep European Countries Together – How So? EU Countries Will Do Fine Even If Some Eurozone Members Have To Go

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By Paolo von Schirach

April 21, 2012

WASHINGTON – IMF Managing Director Christine Lagarde stated in a public forum hosted by Charlie Rose that she is hopeful about Europe and the future viability of the Euro because the common currency is one big part of a broader coming together of diverse European states moved by a shared aspiration towards political unity. The failure of the Euro would stop this process, she added; and this might allow the resurfacing of old intra-European struggles.

The Euro keeps the peace in Europe?

What? The Euro as anti-conflict antidote? This is a bit odd. Are we to believe that if the Euro in its present form proves to be unworkable, then it is back to the Franco-Prussian war?

Everybody would agree that a successful European monetary union would be a major step forward in the long and tortured European unification journey, (this is assuming –as Lagarde assumes– that there is a shared desire to get to a unified Europe). But to assert that the Euro has to succeed otherwise we may go back to ancient animosities, potentially erupting into fresh conflicts, is a bit odd –especially coming from a former French Minister. It is really a stretch to make a connection between the desire to keep Europe at peace and the Euro as a way to guarantee peace.

The Euro’s problems

No, the Germans are not going re-invade France any time soon, with or without the Euro. That said, the Euro has real problems of its own that have really nothing to do with European peace and security. The Euro is unfortunately the half baked result of a half baked plan. It is an imperfect monetary union in as much as it assumed fiscal restraint among diverse countries that are still sovereign in all matters of taxes and spending. Well, as it turned out, some of them behaved badly and allowed huge fiscal imbalances, disobeying the rules.

The evidence shows that the Southern members, (Greece, Italy, Portugal and Spain), used the lower interest rates provided by a stronger currency to borrow more without considering the long term implications of higher debt levels. Now they are deeply in debt, while their weak economies are structurally incapable of regaining competitiveness. And the austerity measures adopted (under duress) work as recessionary wet blankets, at least in the near term.

Weak members will have to leave

Something has to give. I do not believe that these intrinsically weak Southern countries can catch up and stay within a monetary union that ties them with more productive and fiscally more restrained Northern Europe. They lack the ability and the will to re-engineer themselves, becoming all of a sudden dynamic and innovative societies.

The solution is an exit from a monetary union that was conceived for more advanced economies. Should the laggards have to negotiate their exit from the Eurozone, this would be a big mess, but not an occasion for restarting World Wars. There was no danger whatsoever of another intra-European conflagration before the Euro. If some members have to go, and I really believe they have to, Europe may be more messed up, but it will still be at peace.




Obama Pushing The “Buffett Rule” Tax Hike For The Rich, Even Though This Is No Tax Reform – The Point Is To Have A Crowd Pleaser – Romney And GOP Will Also Manipulate Issues – No Serious Policy Debate

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By Paolo von Schirach

April 14, 2012

WASHINGTON – Sebastian Mallaby, (The Buffettt rule is a sorry excuse for tax reform, The Financial Times, April 13, 2012), correctly points out that President Obama’s insistence in pushing the idea of tax increases for the rich (the “Buffett rule”) is bogus tax reform. Surely we could and probably should make sure that rich Americans pay more taxes and that capital gains will be taxed at the same rate as regular income. Let’s do all this in the name of fairness and social justice –just as the President says.

Buffett rule is just politics

But Obama knows full well that this particular tax hike he has been talking about so passionately would raise perhaps an additional $ 5 billion a year, not even a rounding error in a federal budget of over $ 3 trillion with projected deficits still exceeding $ 1 trillion. So, if we are seriously talking about tax reform, we have to reconsider the entire system. And this should be possible. Mallaby points out that Americans overall are not overtaxed and that tax increases will have to be part of any serious plan aimed at reducing the deficit and the national debt. And, in so doing, by all means, let’s make sure that all Americans pay their fair share.

However, reaching this objective is predicated on producing a comprehensive tax reform package. And this is not what the President is proposing. Obama wants an emotionally charged issue with which to run between now and November. This way he is showing that he is not interested either in reform or in raising real revenue.

Real tax reform

All serious policy-makers and analysts know that America needs to do away with its horrendously complicated and inefficient federal tax code. We all know that, thanks to the work of armies of special interests served by Washington lobbyists, the Congress and the President, no matter who was in the majority, overtime created an unmanageable monster that can be understood only by full time professionals.

With strong presidential leadership and a true bipartisan consensus it could be possible to do away with this wasteful and unjust way of apportioning favors through the tax code that is morally indefensible, ethically wrong and in the end economically damaging as economic decisions are often skewed by tax considerations, this way discouraging a more effective allocation of scarce resources. We could raise more revenue, at the same simplifying the system and eliminating the preferences that only the well heeled know how to navigate to their advantage. This is complicated but doable, assuming bipartisan agreement largely predicated on presidential leadership.

Obama not a victim of his staff

Mallaby politely concludes that Obama is somehow forced to be a tax populist by his campaign staff, the professionals who know that issues like the ”Buffett Rule” proposal are real crowd pleasers.

I take a different view. Just as his campaign staff, the President knows exactly what he is doing. Unfortunately, now he is not governing and he is not leading. Now he is a demagogue trying to make the other side look bad using spurious issues. Between now and November Obama will not even try to engage anybody in a serious debate about tax reform, or anything else for that matter.

He is trying to get re-elected. To do so he will continue to portray the Republicans as out of touch Wall Street & Country Club greedy fat cats who want more and more and pay no taxes, while the rest of America struggles with the high cost of everything. If this is manifestly a distortion, who cares? The focus groups and the internal polls say that this manipulation is likely to produce votes.

Romney and GOP doing the same

And this manipulative approach of course goes both ways. Romney and the Republicans no doubt are doing and will do the same. They will latch on any theme, true or false, that can damage Obama. So, forget about any enlightened debate between now and November. It will be hyperbole, manipulation and demagoguery. Nothing serious about tax reform, entitlement reform, energy policy, education or sensible incentives for economic growth. This is bad and damaging. The business of the Nation is not attended to. Voters will be offered slogans, not real programs to choose from. I dare say this old democracy could do better.




Why Is Obama So Timid About Syria? Because There Is No More Money To Get Into A Confrontation That Might Escalate Into Another Conflict – Pentagon Already On A Cost Cutting Path – This Dog Won’t Bite: Assad Is Safe

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By Paolo von Schirach

April 8, 2012

WASHINGTON – The Wall Street Journal editorial page wonders why the Obama administration is so timid regarding the ongoing repression in Syria. The WSJ is puzzled by how long it took for Washington to publicly state that president Bashar Assad has to go and is even more surprised that nothing tangible followed this declaration.

No resources for a confrontation with Syria

Simply stated, US circumspection regarding Syria is not an issue of policy judgment regarding the best course of action that would lead to the end of the Alawite regime headed by the Assad family. The US is not reviewing the options. The Obama administration concluded a while ago that it does not have either the military or the financial resources to engage in a direct confrontation with the Syrian regime.

Timid even about inconsequential Libya

Remember that the Pentagon last year was not at all happy to get involved even in Libya, a far weaker country with third rate armed forces. In the end, the US got involved in the French and British-led NATO air campaign, but only a little, “leading from behind”, as you may recall. And even that cameo appearance became politically controversial in Washington. America was already overextended, too many commitments, too many wars –critics from both left and right said.

And you think that now, just months before the elections, Obama wants to confront a far more menacing adversary who has the full backing of Iran, while it gets supplies from Russia? Sure enough, getting rid of Assad would be a major strategic coup, assuming that pro-Western, or at least not anti-Western, forces would take control in Damascus. This would be good for the Syrian people and a huge net loss for Iran and for Hezbollah in Lebanon.

No money left for wars

But getting serious about Syria would mean having the ability, the tools, the staying power –this means the money– and the political resolve to go ahead with an armed confrontation, should other means fail. And the US has none of the above. Above all, the US lacks one critical component: money to fund even an air campaign.

The Federal Government is already deeply in debt. The Pentagon is putting together serious cost cutting measures. This means doing less with less, starting now. This is the stark reality: no money, no wars, unless vital national interests are threatened. And let’s keep in mind that an entrenched dictatorship might consider relinquishing power only if it knew for sure that the US had the power to make it go by force.

Assad gets the picture: Washington will do nothing serious

And Mr. Assad sees what we see. He sees Washington barking a bit, but not too much and showing absolutely no appetite to ratchet up the confrontation. Big about trying to push UN Resolutions, but not much beyond that.

Simple conclusion no doubt reached by Damascus: no danger whatsoever that America will even consider military action in Syria. That said, there is zero incentive to negotiate with Washington in good faith. As for the other players, let’s give them something inconsequential. Let Kofi Annan come by, let’s talk about this and that. But with the confidence of continuing help from Iran, while Russia and China will block anything else the international community may try to concoct, Bashar Assad is pretty safe.

Obama needs scarce federal funds for entitlement programs

America technically is still a superpower. But it is an exhausted superpower with an anemic economy. A country with no money, trillion dollar plus yearly deficits, a gigantic national debt, and thus no stomach to be belligerent.

Finally, this president wants to get re-elected as the friend of the welfare state. Tough to promise that he will keep doling out benefits, if he begins spending the little money there is on another military operation. Starting one right before the elections would not look good with the voters. This would create the “wrong optics”, as they say in the White House.

As I said, Assad is pretty safe.




The EU “Fiscal Compact” May Not Work, Argues Martin Feldstein – Bond Markets Already Penalizing Weak EU Members – In the End Greece, Spain, Portugal And Italy May Have To Leave The Euro

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By Paolo von Schirach

April 5, 2012

WASHINGTON – Until yesterday the EU leaders and many international analysts concluded that the European debt crisis had been successfully dealt with. After the admittedly long and painful rescue of Greece and new fiscal austerity measures in Ireland, Portugal, Spain and Italy, (all accompanied by political upheaval), it seemed that the worst was over and that going forward there would be no repeat of the excesses that originated the crisis in the first place. To make sure that this will never, even happen again, the EU countries agreed on a new Fiscal Compact about to come into force that commits member states to fiscal rectitude.

Feldstein: Fiscal Compact may not work

Except that it does not, really, argues Harvard Professor Martin Feldstein in a recent WSJ op-ed piece, (Europe Needs The Bond Vigilantes, April 5, 2012). The Compact commits EU countries to a “cyclically adjusted” budget deficit no larger than 0.5% of GDP. The problem is in interpretation. There is no clear definition of “cyclically adjusted”, and each country will argue whatever it wishes to justify whatever level of spending and whatever deficit there will be, claiming that it is within the rules.

The real issue, as Fedlstein notes, is that most countries at the EU Southern periphery are inherently weak and thus incapable of running at the same speed of stronger and more efficient Germany or Scandinavia. Recent rescue plans may work –for now; but unless these economic laggards learn something new, the reckoning has just been postponed.

Austerity, as Nouriel Roubini and others have noted, is inherently recessionary. Beyond spending cuts, (necessary as they are), countries need growth strategies so that they can grow out of debt and prosper. But the economic outlook for the non competitive South of Europe is not good.

Bond markets already penalizing weak economies

And the bond markets have already taken notice. A recent auction of Spanish bonds was under subscribed. Yields on Spanish 10 year bonds hit 5.81%, the highest rate since last December. Italian bonds are back up to 5.49%, the sharpest rise since last November. In contrast, Germany’s 10 year bonds are at 1.74%. The spread is wide. Quite clearly, investors do not want the bad stuff. Soon enough you will see bond prices of weak countries go further down and yields creep up even more.

Very simply, markets will not be fooled by EU Fiscal Compacts establishing iron rules that will be circumvented. Southern Europe cannot get economic efficiency and real growth through treaties. It needs vibrant economies, and Brussels cannot supply them.

Some countries too weak to stay in the Eurozone

In the end, and may be sooner than any risk averse policy maker would like, the Eurozone stronger economies will have to deal with the simple fact that some of the current members just do not belong. While getting them out of the monetary union would be extremely complicated, keeping them in may just not be viable.




Romney Will Get The Republican Nomination – Now He Will Have To Propose An Inspiring Vision Of Growth And Fiscal Discipline, But Also Of Hope And Genuine Inclusiveness – A Revival Of The America Dream

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By Paolo von Schirach

April 3, 2012

WASHINGTON – After primary wins in Maryland, the District of Colombia and Wisconsin, it appears that Mitt Romney has turned a corner. It seems now that the Republicans are finally getting the message that this acrimonious and bitterly contested primary season is not advancing their objective of creating a compelling anti-Obama front that will gather momentum between now and the November elections.

A Republican inspiring message

Alright, suppose that the GOP has gotten wise and that it will close ranks around Romney, letting Rick Santorum know that he has no chance to fill the significant delegates gap between himself and front runner Romney. Then what? Then it would be up to Romney to craft a really inspiring message of Republican change that could resonate not just with the rather narrow base –he’s got those votes anyway– but with the millions of independents who always decide presidential elections.

Until now there has been no real outreach, no inclusive Republican message. No positive message for minorities, for single mothers, for unemployed youth, for America’s poor. Until now it has been all about showing who is the most conservative of all, and thus the truly genuine standard bearer of the ultra pure orthodoxy.

Who is the most conservative?

From the very beginning of this primary season it seemed that Republican voters were longing for a champion who would be the perfect incarnation of the conservative zealot: no new taxes, drastic cuts to government, repeal Obamacare, armed foreign policy, teach China a lesson, kick Russia, never follow the Socialist Europeans, fight the Taliban, Israel-is-our-true-ally, prayer in schools, no gay marriage, no gays in the military, women should stay at home, drill and be blessed with more oil so that we can drive for ever. And this un-enlightened agenda was then enriched with a new vigorous fight over contraception and other silly stuff that, at least so far, managed to further alienate women voters.

This is a mess. This is not the agenda of a modern party with modern ideas. Remember that just a year ago Obama was the weak incumbent incapable of turning the economy around. Now Obama is an enlightened statesman who has managed to improve the economy –or so the pundits say– and will be protecting each and every bit of government program the country is used to. The not so subtle Obama message is “stick with me and the gravy train rolls on, Middle America. Switch over to the other side and super wealthy Romney who could not care less about the problems confronting the middle class will gut the welfare state, cut all your benefits and give more tax breaks to his rich backers”.

Romney cannot run on his business credentials

Running against an entrenched incumbent no longer on the defensive, Romney will not be able to run just on his resume as successful business manager. As the economy is no longer in free fall, these credentials are no longer that compelling. Nor can he run on just the pledge to repeal Obamacare, without providing an alternative people can understand. The fact is –and the polls show it– that right now most Americans are quite ready to stick with the devil they know, Barack Obama, especially since he will keep all the entitlement programs people are used to.

Americans like entitlements

Unfortunately, Americans lack the will to see that behind all these promises lies fiscal disaster. And they cannot see how this president lacks the ability and the conviction to craft and promote a pro-growth agenda. They cannot see that staying on this course of modest to minimal growth, with a suffocating and growing public debt, will guarantee economic decline.

Most Americans are not willing to think of what will happen to this country if competitiveness is not revived and public spending keeps creeping up. The notion of America’s decline is too vague and too distant. People want their goodies today. Let somebody else worry about the bills later on.

The Romney alternative vision

So, if Romney plans to take the goodies away, then he has to create an alternative and truly inspiring vision for a future America, a renewed America of optimism, can-do spirit, enterprise and inclusiveness. A welcoming America that wants to give all a real chance.

Romney would have to talk convincingly about his belief in high quality public education for all. He will have to sketch a vision of urban renewal and enterprise zones and minority involvement and ownership. He will have to spell out his plan to restore innovation and boost US competitiveness. And, if he indeed wants to see the repeal of Obamacare, he better come up with some compelling alternative. Obamacare is a mess; but what preceded it was also a mess. Creating workable wellness programs, redoubling efforts on prevention, as opposed to wasting money on cures for diseases that could have been avoided, is an enormous job. But this is only way to contain health costs while having a system that takes care of everybody.

A tall agenda

This is a tall agenda. But, unless Romney will be able to fashion a real and truly inspiring alternative, middle America, apparently no longer scared about the economy, (and this is bad because this economy is still doing quite poorly), will stick with the devil they know.

Obama knows this and his campaign will demonize Romney as “the rich man who cannot possibly understand your problems, while I pledge to give you all the help I can provide. So, why take a chance, vote for the candidate who will keep all the government spending you are used to”.




More US Oil, Plus Increased Imports From Canada And Brazil Mean Better US Energy Security – Add To This US Natural Gas As Transportation Fuel And Things Begin To Look Good For America

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By Paolo von Schirach

April 2, 2012

WASHINGTON – TIME magazine latest cover story, The Truth About Oil, (April 2, 2012), gives a pretty good picture of what lies ahead regarding US oil supply and prices. Contrary to “peak oil” projections believed to be true until recently, we are not running out of oil. A combination of tight oil, (oil trapped in shale formations in North Dakota, Texas and possibly other states), presalt deep water, (oil way below the Ocean floor, mostly in Brazilian waters), oil sands, (bitumen mixed with sand from which oil can be extracted, mostly in Alberta, Canada), the US supply outlook looks much more promising. In fact, so promising that we may be able to forecast North American energy independence within a decade or so.

Oil from Canada and Brazil, not from OPEC

This means that the US, while still a net oil importer notwithstanding increased domestic production, would be able to meet demand by relying almost entirely on increased imports from Canada and Brazil, in addition to the oil we are still getting from Mexico. In a few years, no more oil from the Persian Gulf or Nigeria.

So, good news? Well, yes and no. Certainly good news from a geo-political and energy security perspective. If you need to rely on imports for a vital commodity, it is certainly a lot better to have the source close by, controlled by reliable allies and stable neighbors. Better to import from Alberta than from Saudi Arabia.

Better US energy security, but prices will stay high

Still, proximity of suppliers would not mean that this oil will be cheaper. Unlike natural gas, there is no regional price for oil. So, given growing global demand, mostly from China and the rest of Asia, we can rest assured that oil prices will stay high, even if our imports will come mostly from friendly Canada and Brazil.

US natural gas to the rescue

That said, we can do more to diminish total US demand and thus the cost of oil to our economy. The TIME story surprisingly does not mention this, but it is quite possible to switch to US produced, abundant and cheap natural gas as transportation fuel. Thanks to shale gas, the US is now the largest natural gas producers in the world. Domestic prices have fallen by almost 80% since 2008. The obvious advantage would be much lower fuel prices , (1/3 to 50% less, possibly more, if oil keeps going higher), with the extra bonus of reduced emissions, as natural gas is cleaner than diesel or gasoline.

It would make sense to start with heavy trucks, as they consume more fuel, while fleet operators rely on centralized refueling stations. Little by little, the US will have an “American Natural Gas Highway” made out of natural gas refueling stations across America (work has already began on this project) that will make it possible for the general public to refuel natural gas powered vehicles. America has domestic natural gas for at least another 100 years.

Use natural gas to power trucks

If it is indeed true that domestic oil from North Dakota (yes, North Dakota now produces 500,00 barrels a day), or Canadian oil will not cost less than oil from Kuwait or Nigeria, US produced natural gas does cost much less than diesel or gasoline made from oil. At some point this fact will compel heavy users to switch.

Last year the US spent $ 331 billion to buy oil from abroad. Even as the US imported less, (thanks to increased domestic production), higher prices meant a bigger oil bill. Well, if we manage to cut down our imports by another 1 or 2 million barrels a day by switching over to natural gas for our heavy trucks, a chunk of that oil money will not go to Nigeria or Saudi Arabia. It will stay at home, to be invested and spent here.

To put all this together, more domestic and regional oil supplies will vastly improve US energy security. In addition to that, switching over to natural gas for at least part of our transportation fuel needs will further improve energy security by reducing imports even more, while it would significantly reduce America’s trade deficit. America’s energy future is looking a lot brighter.