July 9, 2008
From Oil to Armageddon?
What if oil prices continue to rise with no end in sight? Even now with gas at $4.50 a gallon on the West coast, it's becoming difficult for many people to fill up their gas tanks. What's going to happen when it goes to $5.00, $6.00, $7.00 a gallon, or even higher? This will have an effect on all levels of society - from the poor, all the way to the White House. The entire economy of the country and the free world may be at stake. It could lead to war.
I'm not saying this is going to happen, but it could. It is just as likely that gas prices will start to decline by the end of the year. We are already seeing a small drop in consumption and demand, but no drop in prices as the price of a barrel of oil continues to climb. Some investment professionals are calling it an "oil bubble" that is soon to burst. I don't see it that way at all.
Let's explore the consequences of continued gas price hikes and what it will mean for our country. People who are now having trouble paying for gas are going to get angry. Their anger will soon turn to rage and they'll be looking for someone to blame.
It will start on a small scale with people stealing gas from SUVs. That much has already begun. When gas goes over $5 a gallon, they will start angrily, and mistakenly, attacking gas stations with vandalism and possibly fire bombings.
These are the people who believe that gas stations and American oil companies are responsible for the high price of gas because that is what they‘ve been told by most everyone on the Left. It must be difficult living in the world of liberal illusions.
They've heard politicians talk about the "windfall profits" of "Big Oil," and think this means that the oil company that is providing gas to their local station is screwing them while getting rich in the process. They have no idea that the profits are going to millions of people across the country to pay dividends on their retirement investments. They don't understand that most of the real culprits are not even Americans. They just pick the easiest explanation and the easiest target for their frustration.
They don't realize that Shell, Exxon-Mobil, Conoco Phillips, and other American oil companies are just small oil companies with only 3% of the oil market. They have no influence on world oil prices when competing against the real "Big Oil" - the national oil companies of OPEC. Still, the media has convinced them that American oil companies are responsible for the price at the pump and need to be targeted.
As gas reaches $6 a gallon and food prices rise accordingly, riots will break out. People will be screaming "I'm mad as hell and I'm not going to take it anymore." They will attack any business that has been forced to raise their prices as a direct result of the rising oil prices and our misguided attempts to process our food into fuel. Yet these are the same people who support making ethanol from corn, and believe the high prices are the result of a vast right wing conspiracy against the poor and middle class.
As gas reaches $7 a gallon, people will be killed fighting over gas that only the wealthy can now comfortably afford. Word of civil unrest will eventually reach the government through the media, and Congress will debate for the rest of the year about what to do about it. Nothing will get done as usual, because Congress can't control the price of oil on the world market any more than Shell, Conoco-Philips, or Exxon-Mobile can.
If there is any intelligent life left in Washington, they will defy the special interests of the greenfreaks and pass legislation to allow for oil drilling in ANWR and offshore. If Congress won't do it, then the president should do it with an executive order. It won't be quite that simple, he will still need some cooperation from Congress to enforce it.
As gas goes to $8 a gallon, the president may have to declare martial law to try to contain the rioting and looting that continues to break out across the country. By now, he is beginning to realize that things are getting serious and he has a big problem to deal with. His economic advisors are briefing him on the inevitable collapse of the economy if something isn't done soon. He knows from recent history that federal price controls will only result in gas shortages and long lines at the gas pump, and that domestic oil companies and gas suppliers will be forced to try to operate at a negative income level. It could shut down the domestic oil industry altogether.
The State Department will begin to talk in stronger and stronger terms with the leaders of OPEC countries. They will try to convince them of the damage they are doing to the U.S. economy and the need to lower oil prices. There will be little response or cooperation. If India and China are willing to pay it, then why not the U.S.? Anyway, damage to America seems to be what some people, including some Americans, want.
In his lecture, Lindsey Williams places the blame directly on the World Bank and the International Monetary Fund (ie; the Bilderberg group), who supply the money to pay OPEC for their oil. Williams contends that it is the World Bank and the IMF who, on a daily basis, tell OPEC how much to charge for their oil. If the World Bank and the IMF are willing to pay it on behalf of oil speculators, OPEC is willing to take it.
Unable to influence OPEC and the World Bank, our government will begin to realize that this has become a threat to our economy and national security. The government will turn to sanctions against OPEC countries. This will also fail, as sanctions usually do, because the rest of the world needs their oil as much as we do. Their primary source of income and trade will continue to be available. Sanctions will have no effect and embargos would be impossible if they are to continue providing oil.
With gas at $9 a gallon, the U.S. could then fight fire with fire as a last resort, and offer Saudi Arabia and other Arab countries a bushel of grain for a barrel of oil or threaten to cut off their food supplies from the U.S. altogether if they don't significantly lower their oil prices.
The Arabs will likely respond by turning to other countries for grain and food stuffs, if they can find them, and retaliate by raising oil prices even more. Our "good friends" in the Mideast will cease being our "good friends," as we realize that they are holding America hostage at the gas pump. To prevent our economy and country from completely collapsing, the president will have to take stronger action.
When gas is breaking $10 a gallon, and depending on whom the president is at that time, he will have just two courses of action. If he's a Democrat, he will raise taxes on the American people to attempt an increase in production of ethanol and biofuels, adding to the financial burden already being imposed on the people. This, of course, will have no effect on the price of gas for decades to come. It will only exacerbate the problem but will be consistent with the Democrats' solution to everything - raise taxes.
If he's a Republican, then he may address the American people and explain that our country has been attacked economically and this attack has done more damage to our country than the attacks of 9/11. He will be right. We were willing to pay a fair price for Middle Eastern oil but we can no longer allow the American people to be held hostage to unreasonably inflated oil prices. He will explain that he has no other choice but to send military forces into Saudi Arabia and elsewhere in the Mideast to secure the oil fields that we discovered and developed. But it's more likely that he will promote other reasons to launch an attack that doesn't mention oil.
This will not be ignored by other Islamic countries which will join forces with the Saudis in retaliation against America. Iran and Syria will find reason to become involved if they aren't already. This will be real war with Islam over oil, and yes, winner takes all. Our survival as a nation will depend on it.
There is just one problem - we don't have a big enough army. What we lack in manpower, we will have to make up for with technology and advanced weaponry. No war was ever won by overwhelming the enemy with compassion. Wars are only won with overwhelming force. Israel will be attacked by Iran, Syria, Hamas and Hezbollah, and the march to Armageddon will have begun.
Russia will side with Iran and Syria as war spreads throughout the Mideast. China will also be dragged into it. Nuclear weapons may be involved, although I don't believe they would be exchanged between the U.S., Russia and China, assuring mutual destruction. Bible prophesies may predict otherwise.
This scenario is, of course, highly speculative, but entirely possible if we don't take action now to avoid it. We have two choices. We can find some way of bringing down the price of oil on the world market (unlikely), or we can begin to end our dependence on foreign oil by using all of the domestic resources we have available. This alone will encourage foreign oil producers to lower their prices.
We will have to reduce our consumption of oil until such time that America is able to produce all of the oil we require. Petroleum products must be reserved exclusively for transportation fuel and synthetic products such as plastics and rubber. All factories now using oil should convert to natural gas, electric, or other sources of energy.
All production of electricity must be expanded by any and all means available. This includes wind, solar, nuclear, geothermal, hydroelectric, and new technologies in nuclear fusion currently being developed. Clean coal technology should be expanded and used extensively, even if it does make Harry Reid and the Democrats sick. Yucca Mountain in Nevada should be impounded by the federal government under "eminent domain laws" and declared the official nuclear waste depository over the objections of Reid.
But we cannot sacrifice our food supplies for energy. We need affordable food as much as we need affordable energy. Ethanol production must be ended and the greenfreaks must be defeated if we are to save our country. Ethanol works in Brazil because they have the climate for growing vast quantities of sugar cane; we don't. Sugar cane makes for practical and efficient ethanol without disrupting food sources; corn doesn't. As Raymond S. Kraft points out in his recent article, "Ending Our Oil Addiction: Reality Check," compliance with recent ethanol mandates by Congress would be disastrous and impractical for the country.
As the world's largest consumer of foreign oil, just beginning a "moon shot" program toward oil independence will scare OPEC enough to begin lowering the price of oil in an attempt to persuade us to give it up. We played that game before and it worked, OPEC dropped their price so low that our efforts were cancelled. This time there must be no stopping, no matter how much oil prices drop.
I don't expect the scenario I have described actually to happen, but it could. I suspect we will find more peaceful ways of dealing with the problem in time. Gas is already selling for $10 a gallon in Europe. In Europe, cars are smaller, less powerful, and use less gas. Much of the European lifestyle revolves around bicycles and motor scooters. Some are suggesting that we should be more like the Europeans.
We are Americans, not Europeans. We have our own American lifestyle and we don't want to exchange it for a European lifestyle, no matter how much a tank of gas costs. $10 a gallon gas is going to hit us a lot harder than it hits Europeans because we depend on oil more than they do. Much of Europe is still living in the dark ages. That's fine for Europe; it's not fine for America.
The problem of our transportation costs are not going to be solved with "green" energy. Even if effective alternative fuels were developed and available today, the cars being sold today will still need gasoline for the next 20 years. Trucks, ships, and trains will need diesel fuel; aircraft will need aviation fuel, and homes will need home heating oil.
The only solution is to get serious about providing our own supply of oil to meet our national needs. This must be our first priority next to national security, before it becomes a national security issue.
A terrorist attack may destroy a city. This economic attack through oil and energy will destroy the country if it isn't stopped. We have the ability to stop it if we do it now. Congress must be made to listen to the American people - their bosses. If they won't listen, then we must fire those who are standing in the way when their terms expire. The consequences of not doing so could lead to the collapse of our country - or to Armageddon over oil if the present trend continues.
Family Security Matters Contributing Editor J.R. Dieckmann is Editor of Great American Journal.