What Gas Hogs Are Doing to America…

by Stein X Leikanger

May 9th, 2008 9:30 AM

Who do you think is doing the greatest damage to the US dollar? The Chinese? The European Union? OPEC? Brace yourself – it's you, every time you press the gas pedal on your gas-guzzler. With today's oil prices, US oil imports represent $1.5b per day leaving the country — make that $548bn per year. "This represents the single largest contribution to America's balance-of-payments deficit, and is a leading cause for the dollar's ongoing drop in value," writes Michael T Klare, author of "Rising Powers, Shrinking Planet," over at Tomdispatch.com. Hindsight is 20/20, but things would have been a lot different if the automakers had realized where things were headed, when things were headed that way. Meanwhile, motorists unlucky enough to be stuck with land barges are seeing second-hand values take a torpedo in the bow. Yes – gripe, gripe, gripe. But this is serious. If T. Boone Pickens is right, the price of oil is going Polar North, which means the dollar is headed for the antipodes. Klare thinks the yearly US tab for gas could easily reach three quarters of a trillion dollars soon. Do the patriotic thing. Go easy on the pedal, will you?

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Landcrusher on May 11, 2008

TTACgreg, Here is the problem with your theory. If you reduce the military past a certain point, history will show that you end up in a war which will then cost more treasure and lives than if you had maintained a proper defence all along. Furthermore, history has shown that domestic entitlements lead to high unemployment and lowered productivity. There has never been a successful country in the world who used your formula without the protection of a larger power (e.g. USA) that lasted longer than a few decades.

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Thoots on May 11, 2008

Some perspective on this: "There’s nothing the quadruplets above can do that a Corolla/Civic/Elantra/Cobalt can’t." Well, there's something besides "power to burn" that bigger vehicles -- such as "the quadruplets" -- have, but the Corolla-class vehicles don't: Comfort. I'm like a lot of "old geezers" who want nothing much more than one thing: That eight-way adjustable power seat. Heck, it doesn't even have to be "powered," but I'm just totally done with the just-barely-adjustable three-quarter-sized flimsy seats in the small, fuel efficient cars. Many of which aren't much much more fuel efficient than "the quadruplets" are. And "comfort" is a great big reason why "the quadruplets" sell in the numbers they do. This is all part of the discussion we've had about "compact hatchbacks" -- just add some of the comfort we've experienced in the bigger cars, and we'll bounce down in size.

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Landcrusher on May 11, 2008

Thoots, You make a great point. I wonder though, that if they some how managed to put all that comfort in the smaller car, whether it would not just hurt the sales of the more profitable larger cars.

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Geeber on May 11, 2008
i6: Social security expenses (and the like) had been anticipated for a long time, while military expenditures were not so well known given the new administration and the events of 9-11. That's not the point. (And it's irrelevant if they are anticipated - the key is how they are driving spending NOW and how they will drive it in the future.) If the concern is deficit spending, and what is driving said deficit spending, the bigger culprit is entitlement programs. They far outstrip spending on the Iraq War, and they will only get worse in the coming years. We can unilaterally exit Iraq next year - for example, if Senator McCain wins, he could have a Nixon-goes-to-China moment and announce a U.S. withdrawal. The expenditures eventually cease. By contrast, it's extremely difficult to cut entitlement spending. ttacgreg: Please ponder this possibility. What is so wrong with domestic entitlements? That money is spent(I’d say invested) on our selves, our society. The money stays here, and stays in the hands of We The People. Because we can't afford them, that's why. If we are truly worried about deficits - instead of just scoring points against the Bush Administration - then we must be concerned about ALL deficit spending. Right now - and over the long haul - entitlement programs are the main driver of federal spending. Someone has to pay for these programs. We can raise taxes, but sooner or later, taxes will become so onerous that they discourage investment and encourage fraud or a black-market economy. We can indulge our "tax-the-rich" fantasies, but the truth is that if we taxed the richest 1 percent of the population at 99 percent of their income, the resulting revenue would not be nearly sufficient to pay for future government spending (it wouldn't be enough to pay for those programs for even a year). That means the middle class will have to eventually be taxed at a heavier rate. Pch101: Welfare is good if it prevents the alternatives, like food riots and crime. If you want a good case study for what happens when a population is neglected, go search for Marie Antoinette’s head and you’ll find it there. The French Revolution is a good case study of what happens when the government overextends itself in an overseas adventure, and then mismanages the economy at home. Ironically enough, in this case, it was because the French government extended financial and military aid to the Americans in the Revoluntionary War, to spite the British. The French government then excessively taxed the populace and began meddling in the economy. One reason there was no bread (hence, Marie Antoinette's infamous quote) was because of government meddling in the free market (including price controls). There are a few lessons for America in there, but not one that says we must spend more on welfare or entitlement programs to avoid riots. Stein X Leikanger: If you’ve already made up your mind, geeber, there’s no point trying to change it. :-) Housing values are dropping, but some categories are dropping faster. Stein, the NPR article you linked to claims that housing prices in inner city areas are actually RISING. Now you are saying that they are falling at a slower rate than in other areas. Those are two entirely different scenarios, especially if someone is looking to buy a property. With just a cursory search I was able to find a current article that directly contradicts the assertions in the NPR article, and I could find even more on thehousingbubbleblog.com, which has been tracking the imploding housing market for the past year. I wouldn't pay asking price for any real estate in this market, whether it's located in exurbia, an older suburb or an inner city neighborhood. Anecdotal evidence - my wife and I are looking for a house right now, and we have our eye on several properties. Bottom line is that the ones located in the older, closed-in suburban neighborhoods are not moving any faster than the ones farther out of town. Right now, virtually everything appears to be DOA around here.

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