We Reveal the True Culprit Behind Higher Oil Prices

Rising oil prices have impacted the American and global economies. Worse than that, they have shaken the American psyche. It’s gotten so that when we fire up that 350 cubic inch V8 or even our 4 Liter (244 ci) V6 engine, we hear a cash register ringing instead of the throaty roar of our proud American iron. We’ve replaced those jackrabbit starts with “egg on the gas peddle” caution. Someone’s to blame for this assault on a beloved tradition of the American way of life… driving big cars and driving em fast… and someone has to pay.. someone has to take the blame. The question is… “who really is to blame for these rising oil prices.

The finger pointing has started and it’s started in a big way. A lot of fingers are being pointed at the oil companies. They are raking in billions in extra profits now that their commodity has shot up in price. Still, oil is a global commodity and the value of oil is market driven. Sure, the oil companies aren’t selling their oil for a fraction of the global price but they aren’t the ones bidding up the price either. They are just reaping the windfall that comes from the rise in prices, just like people who have been buying gold all these years are now reaping the benefits of their wisdom. No, the group responsible for this oil crises are far more insidious and far less visible than big oil.

Of course, this being a political year, big oil is the perfect target for campaign rhetoric. They are easy to blame and, with their swelling profits, they are also easy to loathe and even regulate. We need someone to blame.. someone to hate for the $100 we have to spend to fill up the tank of our SUV or the $50 it costs to fill up the compact we traded our SUV for. Still, despite the fact that big oil may be the beneficiary of our misfortune, it’s not the cause.

The next target in the blame game is Saudi Arabia and the rest of the OPEC countries. Not many friends on this list. In fact, if it weren’t for the fact they have a lot of oil under their land, I doubt very much if we’d give them the time of day. The group is primarily made up of some pretty despicable people. We’ve got all the Arab nations, who in general abuse and oppress their women and treat them as chattel, a few African countries who, if they aren’t busy slaughtering their own, are some of the most corrupt people on the face of the earth, led by Nigeria, a country who could rightly be called the scam capital of the world and the place that spawned the “help I’m a ________ (fill in a noble position) and I need your help getting _______ (fill in an amount between 20 and 35 million dollars) out of the country and need someone honest to help me” con. Add to this sorry lot, countries who fund terrorists and have sworn to wipe Israel off the map and South American despots who are bent on causing trouble and you’ve got a very unsavory bunch of people. Add to that the basic truth that these countries produce basically nothing choosing instead to enrich themselves off their natural resources while basically ignoring their responsibility to the global community and it’s really easy to see why blaming them for this problem is easy to do.

While it’s true that OPEC could open the flood gates of production and bring down the price of oil, it’s not really fair to blame them either. Of course, they aren’t doing nearly as much as they could to support a peaceful Iraq which would enable the country to bring a much greater supply of oil onto the world market. A peaceful and friendly Iraq and middle east could help increase world production and could temper oil prices considerably.

Of course, should Obama or Hellary be elected President, you can kiss off the idea of a peaceful Iraq and increased production. Still, the anti war factions are probably all driving hybrids anyway so $5 gas won’t impact them nearly as much as the limo-riding, SUV driving, private jet flying Republicans but that’s a story for another day. The bottom line here is this; despite the obvious fact that OPEC’s production does impact oil prices, they aren’t the true culprit either.

Nor is it the market speculators. They too can have an effect over the short haul by perceiving and reacting to anticipated supply and demand but their effect can only be short lived. Nope, it isn’t the speculators and traders either.

I know what you’re wondering about now. Your asking yourself, “Well, if it isn’t big oil and if it isn’t OPEC and if it isn’t market speculators, then who the heck is it that’s driving oil over $110 a barrel?” After much research, and years under deep cover, I have figured out exactly who it is that is driving up the price of oil and I am just sick about it. It’s my sister Abigail. Now, before you lock me up or head over to Abigail’s house with pitchforks and torches, let me say first, Abigail hasn’t been acting alone and she didn’t do it on purpose. She has accomplices, lots of them. She isn’t even aware that it’s her. In fact, she’s one of the people wondering who to blame.

Yet, despite her innocent demeanor and complete lack of knowledge or even an awareness let alone a basic understanding of global economics, I have found her methods to be subtle yet highly effective. Please pay careful attention while I explain to you exactly what she does and how it makes oil prices go up.

First, she and her husband just bought a new Ford SUV with a 4 liter V6. They traded in their 5 year old V8 SUV and are convinced they are helping conserve oil by reducing their fuel consumption. Unfortunately, that’s about as helpful as Al Gore buying those carbon credits to offset the monstrous carbon footprint produced by his private jet. What they have done is confirm to Ford Motor company that there is still a market for 6 cylinder cars that deliver an average of 15 mpg. This assures us that they will continue making them for the foreseeable future since we have been giving them this feedback for years and years.

We live in a consumer driven economy. This means that business will build what consumers want to buy and they will instantly stop building what people no longer are no longer willing to be sold. Once we adjusted to gas in the $1.50 – $2.50 range America’s consumers let the auto industry know that they still had an appetite for size, power and performance and the manufacturers were only too happy to oblige. Conversely, if we had taken a stand in the eighty’s or even the nineties, and refused to purchase anything that didn’t deliver over 50 mpg, today the showrooms of America would be full of them and they would be awesome to look at and to drive. Unfortunately Abigail and her husband have purchased 4 new cars since the eighties and never once did they walk away from the gas guzzlers and opt for the most economical model around.

Thanks to Abigail, and all the rest of the “Abigail’s” in America, cars today are not significantly more economical than they were 20 years ago. If she had stood her ground and demanded cars that deliver 50mpg or better and if we had done likewise, our oil consumption would now be 20% less than it is today. That alone would be enough to weaken oil prices considerably. In addition, with all our gas bills reduced by more than half, imagine how much healthier our economy and dollar would be. Abigail… look what you’ve done….. how could you???? Yet, as awful as this is, this is nothing compared to what else my sister, the ruthless operative, the enemy of rational oil prices throughout the world, has done.

Hang on to your hats because you won’t believe what I am going to tell you now. Abigail is a price conscious shopper. I know, I couldn’t believe it when I heard it either. And, to make matters worse, she almost never looks to see where something she is buying is made. This means she shops a lot in places like WalMart and the vast majority of the consumer goods she buys are made in China. It’s not just WalMart either, pretty much wherever she goes, much of what she purchases, is made in China. Thinking she’s a good American, she buys recognizable American brands when she can, thinking this is going to help but she still winds up with goods that are manufactured in China. Heck, she even has a bottle of McCormick Schilling Garlic Powder in her spice cabinet that, as I write this, she thinks came from Gilroy, California, the garlic capital of the world when, in truth, it was produced in China.

Is that diabolical or what? What, you don’t get the connection between Abigail buying Chinese made goods and the skyrocketing price of oil? Of course you don’t, that’s what makes her the most dangerous operative of all. She’s there in WalMart or Target or pretty much anywhere else, picking Chinese made items off the shelf and people walk buy and see her doing it and they are none the wiser. In fact, they are all doing it themselves. Heck, we all are. Of course, Abby’s not the only operative around. If she were the only one executing this strategy, it would never work but, by us working together, it’s working flawlessly. Here, I’ll connect the dots for you.

Fact #1 – You can make stuff in China cheaper than in the US. So much cheaper, in fact, that American companies can afford to manufacture a product in China and pay shipping and import duties and still sell it cheaper than if they produced it in the US.

Fact #2 – Most American consumers, given a choice between two comparable products, will choose the one made in China if it is priced lower than the one made in America.

Fact #3 – Retailers compete for consumer dollars based upon price vs perceived quality and brand has more to do with perceived quality than the country where a product was manufactured.

The bottom line here is simple. If you want to compete with a product, make it in China.

How can China afford to make stuff so cheap? It’s simple. They pay their workers less than $300 a month and work them longer hours with fewer benefits or safety precautions. China is about the same size as the US but they have 1.3 billion people compared to our 300 million plus. Their people have little and want less than American’s. It’ s not rocket science… it’s fundamental.

Since America is full of the world’s greatest consumers and China is the land of mass manufacturing, we have been and contninue to be the primary moving force behind the emergence of China from a developing country into a manufacturing and economic powerhouse. Our companies are directly or indirectly employing the Chinese instead of American workers since American consumers are willing to purchase virtually anything, regardless of where it was made as long as it has acceptable quality and is priced better than alternative products. This totally shortsighted attitude has directly fueled the growth of this new economic powerhouse.

A direct byproduct of China’s explosive growth as an economic superpower is a rapid increase in energy consumption by China. Not only are they building and powering more and more factories, a rapidly expanding workforce needs transportation to and from work. Bikes are replaced by scooters and scooters are replaced by cars. More trains and buses are needed to transport this ever expanding workforce. All this takes more and more energy and it is this rapidly expanding demand for oil that is driving up the price of oil and the cost of a gallon of gas for our cars.

At the same time, we are also fueling economic growth in India, although to a lesser degree with a focus on textiles. For example, in 2005, WalMart alone imported about $1.5 Billion worth of goods from India while importing more than $20 Billion worth of goods from China and the imports from these two countries have been growing exponentially for years. With a greater understanding of the kind of growth that India and China are enjoying, thanks to our unabated corporate greed and American’s unquenchable appetite for more cheap stuff, coupled with a total disregard of the far reaching cause and effect of this rampant consumerism absent any sense of nationalistic pride, we can finally begin to appreciate why a gallon of gas is approaching $4 a gallon. We have created the demand for more consumption within the Asian theater. All the while, we are sending our money over there to fund the growth and to pay for the oil that they competing with us to buy. Pretty stupid when you stop and think about it.

So, as long as Abigail and the rest of us keep buying and driving cars that deliver less than 50 mpg and as long as we keep buying goods made in China this vicious cycle will continue. When will it end? That answer is as simple. It will end the minute we make the decision to stop buying goods that are not good for America. When we, as a society, collectively draw a line in the sand and say “No More” and let inefficient cars rust on the lots and either do without or opt for the “Made in America” label rather than take another Made in China product to the checkout stand, American business will stop importing them.

American business is great at selling us what we want and they listen very carefully. They listened when we told them we wanted acceptable quality and really low prices regardless of where things were made and believe me, they will listen when we tell them that we made a mistake and want to go in another direction. Sadly, most of us are followers so those of you that are leaders, it’s time to lead us out of this big mess we’ve made. Here’s hoping we get started before it’s too late. The clock is ticking and it too was made in China.

NOTE: We are featuring an exciting company that manufactures and sells lithium-ion battery powered motorcycles. They are the kind of company that benefits from an oil crises and their bikes are made right here in America. Check them out by clicking here.

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