Like the ex-President Clinton said, "It all depends on what your definition of is, is." All the figures are adjusted for inflation. "It all depends on what your definition of is, is." Whose figures for inflation? I don't know. Who determined those inflationary figures? I don't know, it all depends on what they want it to say. They use terms like metric tons of fuel and relative dollars. "Yes, I'd like to purchase three-thousandths of a metric ton of fuel, please. How many relative dollars will that cost me?"
The relative dollars and adjusted for inflation work just fine except that it is oil that is driving the inflation and changing the value of those relative dollars. It's akin to rating snowfall by snowfall; how much snow is out there? "Why, there's one snow fall out there!" You find this same conundrum in weather forecasting, the other tarot card science. It's ten below zero, but a 20-mph wind makes it feel like thirty below! On a warm summer afternoon it's eighty-five degrees, and that same 20-mph breeze is worthless; no one mentions wind chill factor in June.
Living here in the South I've heard of the heat index, but it is like using a yardstick to measure pepper. Ninety degrees in Mobile or New Orleans after a thundershower must be experienced to be understood, while in Las Vegas ninety degrees is quite comfortable. They explain, "Well, it's a dry heat." Touch your tongue to the car door handle at a 103 and then tell me about dry heat. The measuring tools only measure certain aspects, making them useless as an overall-measuring device.
I once ran five miles in Vegas; the low humidity made my perspiration evaporate as fast as it came out. Only the dryness in my throat alerted me to my coming dehydration. I couldn't run five miles in Mobile; I've tried it and the humidity so tasks my body and soaks my clothes that I must stop. Air saturated with water is harder to breathe than dry air. Or, you could just say I'm in better physical condition in Las Vegas. "It all depends on what your definition of is, is."
Climbing through these dark and thorny woods of statistics, counter statistics, explanations, and counter explanations are the briars and brambles of ideology and moral relativism. Even the events themselves are disputed; the oil price rise in 1980 was brought on because of the Iran-Iraq war, according to the American Energy Administration. However, according to the Ludwig Von Mises Institute, a nut ball think tank of libertarian economists, they said it was the Iranian revolution. They don't try to explain why a political upheaval in one oil-producing country could cause prices to spike more than a war between two oil-producing countries would.
Because we say so, that's why. We're the experts here, so you have no qualifications to correct us. Except maybe that their qualifications are in economics and not in history. It fits their conservative agenda that it was Jimmy Carter's foreign policy more than the Reagan-backed, Iran-Iraq war. "It all depends on what your definition of is, is." So, not only are the values skewed but even the reasons behind the values. The Von Mises folks try to make the argument that oil prices today are actually lower in relative dollars than they were in the 1980's. Yeah, and an eagle is just a frog that doesn't live in water, jump, or say ribbit.
But according to the Von Mises folks, we are living in a new golden age, low energy prices, mineral prices, and of course cheap, cheap labor. By their standards these are the good old days, but their standards don't include one vital factor in the equation, humanity. You see, they live in the darkest part of the woods; they stir the cauldron of globalism and their spells and incantations are for higher profits and lower taxes. Were you to suggest to them that it is globalism that is responsible for higher energy costs worldwide, you would most likely end up in their pot!
The weak dollar of the 1970's was in an America that was a creditor nation, and the weak dollar of 2008 is in a debtor nation that imports more than it exports. That imports more oil especially, so the price of oil isn't just determined by demand but by current and future expectations of where the value of the dollar might go. Ben Bernanke has the nerve to testify before congress that the lower dollar helps our trade balance by making our products cheaper. This is true on a fourth-grade level, if you ignore that it significantly fuels inflation on every item that we import which, have I mentioned lately, is more than we export!
By lining up all the statistics, all the facts, the reasons, the rules and the exceptions to the rules, it would appear that no one knows. It is unfathomable and unknowable, yet the oil companies all seem to make a profit and according to the economists all is right with the world! Maybe, just maybe they say, we will go into a slight recession, but it will be short-lived and very shallow, almost painless. Except for the millions losing their homes, and don't forget the rest of us making payments on homes now worth the same or less in their relative dollars than when we bought them. That figure is uncalculated; it is the wind chill factor on the warm, sunny day.
But I'll use my own standard; one of my hobbies has been classic Ford Mustangs so I'll call it the Mustang standard. In 1965 the price of a fully tricked-out Mustang was around $3,000 and the minimum wage was paid at $1.25, so a new Mustang would cost a minimum wage worker 2,400 hours of labor. Today, a tricked-out Mustang is around $30,000 dollars; even with our new and improved minimum wage of $ 5.85, the worker needs to work over 5,000 hours to purchase that car. Ah, but I hear them already, that's not fair, it's not relative, new Mustangs are faster, safer, with more options. Yes, it's true, but a new Mustang is a new Mustang, just as a debtor nation is a debtor nation and cannot honestly be compared to when it was a creditor nation.
A 1965 Mustang came with a 16-gallon tank and would cost around $4.80 cents to fuel up. A new Mustang, with a 16-gallon capacity, to fill up at $3.65 a gallon is $58.40, so going back to our minimum wage figures, they remain fairly constant. In '65, 3.84 hours of labor; in '08, 9.98 hours of labor. Not only has our buying power declined but the price of fuel has also soared. Of course I'm stating the obvious, trying to make the point that it all depends on what your definition of is, is.
The economists and the Von Mises crackpots miss the point entirely; the only measure worth correlating is the quality of our people's lives. That profits without good jobs are a day at the beach without a home to go home to. That people build nations, profits don't build people. As Lincoln advised, "A house divided against itself cannot stand." Corporate profits without meaningful employment is just that. A downward spiral that will become a vortex until one or the other of them ceases to exist.
So, what began as contemplation of what $5.00 a gallon gasoline would do to this country, turned instead to what I see as a far greater danger. The Orwellian truth tellers and explainers of faulty logic. That good news is bad news and bad news is good news because . . . . They are ones, who keep us from seeing the forest for the trees, so we, as a nation, stumble through the woods, aimlessly asking directions from those who have every interest in keeping us lost.