Makes you think...
So far every official story about soaring gas prices points the finger at crude oil prices - $135 a barrel. We are supposed to imagine that's what the A-rabs show up asking, and well, nothing you can do about that. In fact, these prices are determined at the New York Mercantile Exchange, the trading market, where crude oils are bought and sold the same way like stocks and bonds. To think that the A-rabs are the bottom line is as naive as to believe that the street price of crack cocain is what the Columbian drug mules get. Wrong! By the time Exxon Mobile gets the bid, it's already been through several groups of "middle men", each trader millions of dollars richer. These traders put out scares and rumors dialy and jack the prices up. U.S. invading Iraq? Jack it up. Israel planning to bomb Iran? Jack it up. China raising prices? Jack it up.
Who are these traders? Unfortunately, just like the underground drug lords, we know a little and yet we may never know the whole story. Since 2000, when the "Enron Loophole" was passed, these traders were able to become invisible and trade electronically without a paper trail. The NYMEX has since then become a black market where no one knows who's manipulating, who's profitting from price gouging, or where the money really went. Some names we know: the investment banks in New York, hedge funds like G-Sachs and Morgan Stanley. Since 2001, they've put $200 billion into commodities market and made a ton of money. And it's all unregulated, and the players get to jack the prices up to wherever they want. Other commodities that they have gained control include wheat, corn, milk...and as a result of, again, price gouging, the poorest people on earth could no longer afford food, and riots have broken out in about 20 countries in the past year.
Supply and demand is the conversatives' favorite explanation of the gas prices. Sure, it is a factor, but it can account for maybe 1/3 of the price increases. 1/3 of it is market speculation and manipulation just explained. The last 1/3 is the weak U.S. dollar. As a country running on debt ($26 billion a month in trade deficits, and all of the money used in Iraq war came from foreign loans), the only thing preventing us from going bankrupt is to devalue the dollar.
So, next time you're at the pump paying $4 a gallon ($7.85 next summer if things continue the way they are), think of $2 of that as dumb tax. The price you pay for not knowing what's really going on while the invisible traders laugh all the way to the bank. Then ride home and bicker about Obama's lack of a flag pin or offshore drilling as if any of it would amount to anything. The invisible hand that conservatives like to say would regulate the market? Sure. In this case, that invisible hand is in your pocket and you don't even know it.
Note: anybody know how the French Revolution happened? Bread prices. With the government washing their hand off of it, bread prices could only get so high until the poor finally took the matter into their own hands, and stormed the Bastille. After a hundred thousand citizens massacred each other, counter massacred each other, the King and Queen guillotined in public...the new government set a limit to the bread prices and only then did the angry mobs settle down. Other factors leading up to the revolution? France was running on foreign loans because of unnecessary wars they engaged in; the rich were getting richer, poor getting poorer; the currency (livre) was devaluating. Sound familiar to you?
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