Within 2 short years of being elected president the Obama administration had seen the number of limousines in the federal governments inventory shoot up 73% according to the GAO (General Accounting Office). Recognizing a problem of perception with the 2012 election coming up the Obama solution was not to get rid of all the new limos but rather to change the definition so the new number would not appear so large. Then they asked the GAO to do another count which of course reflected smaller numbers because of the change in definition. Your tax dollars at work, thanks Obama.
If you have read this blog before you probably have realized that it tends to be somewhat negative sometimes because it reflects what is going on in the wider world. So after reading a fascinating article over www.foreignpolicy.com entitled The End of the Asian Miracle I wanted to share some of the author’s insight on some very positive things happening right now for the US economy. The article is fairly long but does go in-depth about how China is beginning to lose some of its competitive advantage versus the US and is worth reading but for the sake of time I’m only going to address what is actually happening in the US instead of the rest of the world.
Perhaps the biggest new development happening in the US is the discovery and extraction of shale gas that is allowing the US access to large quantities of domestically produced cheap energy for the first time since probably the 1960’s. Yes, we have had the Alaskan oil discoveries since then but this has the potential to be much bigger and because of this its impact will be much more beneficial. The effects of this are already being felt in manufacturing with some US companies returning production back to the US from overseas because of the cheap energy, but also foreign companies moving their operations from their home countries to also access this energy. According to the article the US now is supplying gas to domestic customers at about $2-2.50 per 1 million BTU. Compare this with China which imports gas at a price of about $13-17 per 1 million BTU. As you can see that is quite the advantage for us. I’m sure you are wondering about how this relates to oil? The article states that the $2-2.50 price is equivalent to an oil price of about $12-15 per barrel. But the size of the deposits discovered in America mean that this will be an enduring advantage, one so great that this gas will not only power energy intensive manufacturing plants but also provide electricity and perhaps even fuel cars and trucks. Obviously fueling are personal vehicles is some way off because of the lack of infrastructure (the technology to convert our vehicles already exists and is relatively cheap) but it certainly is not unreasonable to see fleet vehicles that operate out of a terminal being able to take advantage of this much sooner than cars. Cheaper transportation costs mean cheaper goods at the store, we all win. In fact the reserves of gas are so large that the idea of the US once again being energy independent may become a reality, now that really is something positive to move forward with.
When I first read the story about the Commerce Sec. Bryson getting in all of those wrecks recently the first thing that jumped out at me was this guy needs real help. The second, what the heck is this guy driving around in an import while he is at commerce. This should just be so obviously wrong it should never happen. Here is part of the mission statement of what the commerce department is supposed to be about lifted off their website.
“To drive U.S. competitiveness in the global marketplace, the Commerce Department works to strengthen the international economic position of the United States and facilitates global trade by opening up new markets for U.S. goods and services.”
If I was the leader of a government organization and the above was part of my job assignment I certainly would not be driving an imported car. Besides the fact that the commerce department is the lead organization in the Obama administration quest to double American exports. Hard to do that when your driving an import.