By Robert Singer

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October 8, 2008

2008 Debate: "It's the economy, stupid"

Barack Obama and John McCain clashed over the causes and cures for the worst economic crisis in 80 years in the debate last night.

Republican McCain called for a sweeping $300 billion program to stop mortgage foreclosures so they could continue the American Dream and get back to shopping. Yes, national politicians are still suggesting that if we just shop some more for stuff made in China, our economy will get back on track. What part of import/export economics do our elected officials not understand?

The current economic crisis, according to Barack Obama, is the result of the last eight years of the Bush administration. Not true, it is the final verdict of United States economic policies of the last six decades. Americans enjoyed the highest standard of living in the Western world based on our ability to import cheap, raw materials (thanks to the CIA) and ship refrigerators, cars, airplanes and military hardware to the rest of the world. When the rest of the world caught on, and the refrigerators, cars, airplanes and even our socks started to be produced elsewhere, we still had one more product to ship offshore, and, beginning in 1980 the Reagan administration embarked upon the greatest export of all: OUR DEBT. What we are witnessing in the economic crisis today is the final death march of the dollar. After the government printed an extra trillion dollars over the weekend, the huge drop in markets worldwide shows the extent to which people no longer believe the safest place to be is in U.S. dollars. Our economy also hinges on understanding our dependence on foreign oil. Both Obama and McCain were sure that if we just get out and start drilling we can get the economy out of trouble and back on track for everyone to experience the American Dream. Although drilling offshore or onshore is on the bridge to nowhere, there is a solution to our economic problems related to energy.

Does the following analysis sound familiar?

A weakening U.S. dollar is putting upward pressure on oil prices. The shock produced chaos in the West. In the United States, the retail price of a gallon of gasoline rose 50%, consumption dropped by 6.1% from September to February. Underscoring the interdependence of the world societies and economies, oil-importing nations in the noncommunist industrial world saw sudden inflation and economic recession. The energy crisis led to greater interest in renewable energy and spurred research in solar power and wind power as well as increased interest in mass transit.

Sound like 2008? Nope--it was 1973!

The most apt precedent for the rapid energy-price increases Americans are feeling today was the oil shock of the mid-1970s, set off by the Arab oil embargo of 1973.

Then President Richard Nixon and the rest of the U.S. government sprang into action, but instead of promoting and producing mass transit, renewable energy, and high mileage vehicles they gave us the Trans-Alaska Pipeline.

What would our economy and climate change look like today if we had not chosen to build, build, build the Alaska Pipe Line? Denmark was also badly hammered by the 1973 Arab oil embargo, but, unlike America, it responded to the crisis in such a sustained, focused and systematic way that today Denmark is energy independent. And it didn’t happen by Danish politicians making their people stupid by telling them the solution was simply more offshore drilling.

Did Danes suffer from their government shaping the market with energy taxes to stimulate innovations in clean power? In one word, said Connie Hedegaard, Denmark’s minister of climate and energy: “No.” Denmark’s exports of energy efficiency products have tripled.

“It is one of our fastest-growing export areas,” said Hedegaard. It is one reason that unemployment in Denmark today is 1.6 percent. And of course Denmark’s solutions addressed climate change 31 years ago, imagine if the US the largest polluter in the world until 2007 had prevented billions of tons of CO2 from reaching the atmosphere. We wouldn’t have a climate change crisis to go with our energy and financial crisis. But, wait, maybe they’re related!

What does our President--the one with the lowest approval rating since Richard Nixon just before he resigned--tell us is the solution to our dependence on foreign oil? On April 29, 2008 in the Rose Garden, President George W. Bush said, “I've repeatedly submitted proposals to help address these problems. Yet time after time, Congress chose to block environmentally safe exploration in Alaska National Wildlife Reserve (ANWR).” Later in the same speech the president said, “If you mention ANWR, it means you don't care about the environment. Well, I'm hoping now people, when they say "ANWR," mean you don't care about the gasoline prices that people are paying.”

America’s short-term “solutions” have cost its economy billions in long-term effects. No wonder we are in the final stage of our failed economic policies of the last 60 years. We didn’t lose the American Dream; we drove it away in a gas-guzzling SUV…to get to the mall.

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Authors Bio: Robert Singer is a retired information technology professional and an environmental activist living in southern California. In 1995 he and his cousin Adam D. Singer founded IPC The Hospitalist Company, Inc., where he served as chief technology officer. Today the company manages more than 130 practice groups, providing care in some 300 medical facilities in 18 states. Prior to that he was president of Useful Software, a developer and publisher of business and consumer software for the personal computing Industry.