Thursday, May 22, 2008

The Real Mortgage Crisis

For the second time in four months, President Bush has visited Saudi Arabia and asked for relief from climbing oil prices. And once again Bush was rebuffed by the Saudis. As Thomas Friedman points out in the New York Times this week, these events herald a significant shift in power, a shift that threatens to alter significantly the United States' standing in world affairs. Most Americans, however, are unaware of the ramifications of such change. Instead, they raise a hue and cry over rising prices at the gas pump, while talking heads pontificate over how badly this will affect the summer travel and vacation forecasts. Even John McCain and Hillary Clinton have jumped into the fray by advocating a temporary summer reprieve on gasoline taxes, as if that will magically prompt people to load up their minivans and drive around the country in mimicry of the "Great American Vacation" of decades past.

What none of our leaders, real or presumptive, want to address, from Bush to the presidential candidates, is the root problem: America's dependence on imported oil. We already know that the Bush administration's "energy policy" - largely crafted by Cheney and enunciated in a report never made public - has favored big oil and big coal, while giving only tacit attention - and meager budget support - for development of alternative fuel technologies. And it's probably a safe bet to assume that whoever wins the presidential election in November, Democrat or Republican, will prove incapable of facilitating a shift away from fossil fuels in the foreseeable future. The next occupant of the Oval Office, Friedman concludes, will inherit a "straightjacket" left by Bush and his policies. Realize too, that the twin economic monoliths of oil companies and domestic auto manufacturers have effectively dawdled in their efforts to address these issues. And let's face it, these corporations wield a great deal of clout throughout the entire political structure, irrespective of party affiliation.

When not focusing on tabloid subjects and reality television outcomes, the news media over the last several months has focused on the mortgage crisis and its effect on the very fabric of the "American Dream." Few will argue that this isn't a serious stumbling block to continued economic vitality in the U.S. Indeed, we're already seeing how foreclosures and declining new housing starts can negatively affect peripheral areas of the economy. Nevertheless, the approaching energy crisis seems a much more insidious threat. Because while middle class homeowners have mortgaged themselves into untenable positions with skyrocketing monthly payments and impending foreclosures, the United States has mortgaged its future to a handful of nations that control the lion's share of the world's oil supply. Eventually the bill will come due and the U.S. will have to pay the full price for its dependence on these nations, trading security and standing for oil.

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