Free Markets, Free People
Gallup tells us that economic confidence has slumped sharply in the past two week due mainly to the spike in gas prices driven by the unrest in the Middle East and North Africa.
Funny how that works, no? Gas prices go up, economic confidence goes down. And the rest of that goes “economic confidence goes down, incumbents suffer”.
So you’d think smart politicians would want to ensure that they’ve done everything they could to ensure gasoline prices remain as low as possible.
You’d think. But that’s not exactly what has happened here, is it? We’re now in the 10th month of a drilling moratorium imposed by this administration, so there’s really no immediate or impending increases in production domestically that could help ease this, is there?
The slump in confidence is likely tied to gas prices, which have risen sharply amid growing political instability in the Middle East, most notably in Libya. The U.S. Department of Energy reported an increase in gas prices from an average $3.14 per gallon nationwide during the week ending Feb. 14 to $3.38 this past week. In addition, news media focus on the challenges governments are having in passing budgets may also affect Americans’ perceptions of the economy.
Gallup’s Economic Confidence Index comprises two measures — one assessing consumers’ views of current economic conditions and another measuring their perceptions of whether the economy is getting better or worse. Both components are more negative than they were two weeks ago, but most of the change has come from increasingly pessimistic expectations about the economy’s direction.
The pessimism is being driven by the understanding that we haven’t the means to effect the problem nor have we done anything in the interim to improve our ability to effect the problem. In other words, we’re more at the mercy of foreign oil now than we were when this administration took office.
Secretary Salazar has been on a vendetta against oil, using the unusual but certainly horrific accident on the Deep Horizon platform, to effectively shut down a critical portion of the domestic oil industry. It has cost thousands of jobs and billions of dollars (not only to the industry but to the government in the form of royalties and taxes). Rigs which were scheduled to be deployed in the Gulf before the moratorium are now deploying elsewhere. It costs millions for companies when oil drilling rigs sit idle. So they’re off to do what – exploit foreign oil fields. And they most likely won’t be back in Gulf waters anytime soon.
The point, of course, is the entire energy situation in the US is being badly mishandled by the incumbent administration. And while they sit and fiddle, we become less and less able to effect world pricing for oil because our capability has been hamstrung by a government and bureaucracy that is basically antagonistic to fossil fuels.
That’s a risk, especially in these economic times. If the economy is still in this sort of shape, pessimism still holds the majority in consumer confidence and gas prices hang around the $3.50 range, even some of the so-called front runners in the GOP at this point might be able to squeak out a win. And it would most likely, as Charlie Cook predicts anyway, mean a tough election for Congressional Democrats in both houses.
Gasoline isn’t going to go down anytime soon as the unrest continues to roil the ME and N Africa. And if something happens in Saudi Arabia, all bets are off. But it is interesting to see how quickly the price of one commodity – albeit a critical commodity – can turn sunshine to gloom with the public. It is something to watch going forward.
Nicholas Kristof manages to roll up all the naiveté of the left into one article in which he explains why he thinks those who don’t think democracy will be the final outcome of the unrest we’re seeing in North Africa and the Middle East are selling the people there short. He’s pretty sure all those who’ve said that democracy most likely won’t be the product have got it wrong. Because he’s looked into the eyes of those who’ve protested the authoritarian governments there and, well, let him tell you:
I don’t think so. Moreover, this line of thinking seems to me insulting to the unfree world. In Egypt and Bahrain in recent weeks, I’ve been humbled by the lionhearted men and women I’ve seen defying tear gas or bullets for freedom that we take for granted. How can we say that these people are unready for a democracy that they are prepared to die for?
Well, sir, because they haven’t any tradition of democracy nor do they have any democratic institutions ready to ensure the outcome of the turmoil is democracy … that’s how.
There have been thousands … millions even … of “lionhearted men and women” who’ve braved tear gas or bullets in the name of freedom, only to end up suffering under authoritarian or totalitarian regimes. Take the way back machine to Hungary in 1956 for instance, when a scenario much like this played out there ultimately to be crushed brutally by oppressive communism.
It certainly isn’t for the lack of wanting to see something like democracy flourish in the Middle East and North Africa. Heck, that would be wonderful. But it is an appreciation for history and an analysis of that history that ends up pointing out that probability – because of conditions beyond the protesters control – doesn’t bode well for a democratic outcome.
Kristof’s premise is many in the West think Arabs, Chinese, etc. are “unfit for democracy”. Not at all. In fact, he misses the point completely.
It has nothing to do with the fitness or unfitness of any people. I’m of the opinion that all people yearn for freedom and, if introduced into a democratic system, would flourish (and millions have, emigrating to free countries).
It isn’t their fitness or unfitness that’s in question, it’s the fitness or unfitness of the culture in the country or region in which they live. Does it indeed support the principles of freedom and liberty, does it allow equal access for all, does it indeed allow all to participate equally and finally, does it contrive to protect the rights of the individual over the power of the state?
Look at the present regimes in the area and history of the countries in the area and you tell me. For the most part the cultures in many of them don’t support the principles that underlie a democratic society. That’s obviously not to say that can’t change, but the question is what is the likelihood, given the specific country’s culture and history, that it will change?
That is where the examination has to take place – not in the hopes and aspirations of a relatively few “lionhearted” people who yearn and fight for such freedom. Is there a chance? There’s always a chance. Is it likely? Well, history says no. I’d like as much as anyone to see history proven wrong in the case of all of these countries. But like Egypt, where the real power behind the throne – the military – is still in charge of the government they’ve essentially run for 50 years, it appears unlikely that the essential pillars of a democratic society will be allowed to be erected and strengthened. It just goes against human nature and the dominant political culture that still holds power in that country.
Do I hope democracy is the product of these protests and revolutions. Yes. Do I expect it? No. And the reasons given are why. What the US should be preparing for is the probable outcome while working to encourage the hoped for outcome. Unfortunately, I don’t see it doing either.