Spoiled Rotten Nation Screams for Socialism to Combat High Gas Prices

Thanks to a recent series of refinery and pipeline mishaps, gas prices are spiking again, and Spoiled Rotten Nation isn't happy about it. In fact, SRN is SO unhappy about having to pay more money at the gas pump that it is demanding government action to correct the problem. The call to arms was issued on Friday by one Patrick DeHaan of Gas Buddy.com:

The day when motorists see such rapid increases in gasoline prices is the day when it should be asked by lawmakers if there is enough spare refining capacity. That day should have been long ago.

The number of refineries have dwindled. Unstable margins have added into the risky future of expanding a refinery. The U.S. can require a certain amount of ethanol to be consumed and produced yearly, prompting hundreds of new ethanol refineries. But oil refineries? Nothing new in decades. Why hasn't the U.S. looked at oil refineries and the lack thereof in the volatile prices? It doesn't matter how much oil prices are or how much ethanol we produce- if we're still subject as a country to sticker shock like we're seeing- what's the point?

As I recall, the requirement of ethanol was supposed to drive us towards energy security. As long as there is conventional gasoline, there's no such thing. As long as we're subject to refinery fires and equipment malfunctions, all is pointless.

We need additional refinery capacity. We saw the direct reason why several times this year- specifically along the West Coast today. It was the Great Lakes region a few weeks ago, it was the West Coast earlier this year. It could have been the East Coast earlier this year when several major refineries were being sold or closed.

The bottom line, politicians, is that it doesn't matter how hard we try to become energy independent. It should start here at home with managing our refineries better, and building new state of the art facilities- just like the ethanol industry has been doing the past decade.

As a motorist, I'm disgusted that we're subject to every problem at a refinery, whether it be a fire, a control board failure, an equipment problem, etc. Let's get the act together. If we don't follow up, it'll cost this country precious GDP as more money goes to the gas pump, diverted from elsewhere in the economy. Wake up, politicians.

Holy shit...alert Michelle Bachmann and let her know that there is an good old fashioned Trotskyite writing for Gas Buddy.

I'm being only half facetious here. Mr. DeHaan is simply falling back on the typical reaction that nearly every American has when they are upset about something: the federal government must DO something...and now. The fact that oil companies are private concerns and that their decisions to build or not build refineries have NOTHING WHATSOEVER to do with government policy (other than the required licensing) nor the "politicians" he is desperately pleading for action from seems not to have crossed his mind.

To make matters worse, DeHaan confuses his demand for something to be done about America's supposed shortage of refining capacity with federal ethanol polices in which an entire industry largely exists because of corn subsidies and federal mandates. The government did not itself build any of the ethanol plants that are now consuming approximately 40% of America's corn crop each year and helping in this recent time of severe drought to drive corn prices into the stratosphere, it merely created the conditions to allow big agribusinesses to profit from the whole boondoggle.

Herein lies the very essence of Spoiled Rotten Nation, petulantly demanding that the government take action to allow its resource depleting and environmentally destructive happy motoring ways to continue indefinitely. It is also a big reason why there cannot be any serious debate about the very dire predicament we find ourselves in as the day of reckoning for our unsustainable "American way of life" approaches. The only redeeming quality in DeHaan's delusional article is that at least he didn't trot out the ridiculous notion sometimes asserted by conservatives that the utterly impotent environmental movement is responsible for preventing the rich and politically connected oil companies from building all the new refineries they'd want to build or drilling any hole anywhere they want were they so inclined.

The fact is, and this would be obvious to Mr. DeHaan if he stopped for a minute and thought this problem through rationally, that if the oil companies thought building new refineries was going to be at all profitable, they would be building them as fast as they could. The fact that they are not doing so tells you all you need to know about the reality of peak oil and whether the industry itself really expects there to be enough oil available in the future to keep the current number of refineries busy, let alone any new ones that they might bring online.

So, Mr. DeHaan, here is a little friendly advice from me to you and SRN: suck it up. Buy a hybrid. Move closer to your job. Take the fucking bus, already. Because it isn't going to get any better from here no matter how much you piss and moan, and there isn't and damn thing the politicians can do to help you.


Bonus: "You can say what you want to say...You can think what you think you want...It doesn't matter anyway...It's not funny anymore"

Strauss Discount Auto Shutting Down All 46 Stores

From North Jersey.com:

Strauss Discount Auto, the 93-year-old company founded in Newark, has filed for Chapter 11 bankruptcy protection for the fourth time, closing all 46 of its stores, including 24 in New Jersey.

The troubled auto-parts retailer formerly known as R&S Strauss abruptly shuttered its retail outlets - including two shops in Wayne, and others in Bergenfield, East Rutherford, Lodi and Passaic - and filed its petition in federal bankruptcy court in Newark Tuesday. The company also dismissed 580 employees, according to the Chapter 11 filing.

On Wednesday afternoon at the Strauss Auto store on Route 23 in Wayne, two signs on its doors said, "This store is closed." The signs also advised customers with inquiries to call 800-787-4554, Strauss's regular customer-service line.

The recording didn't mention the Chapter 11 filing. It merely said, "You have reached Strauss Auto ... We are on the line right now attending to other calls, but want to address your issue." It then asks customers to leave a message.

In Wayne, where the parking lot was empty and no one was inside, the signs also advised store managers to contact their "DM," district manager, and for store associates to contact their store manager.

In addition to its New Jersey shops, Strauss Discount Auto closed 19 stores in New York City metro area and three in Pennsylvania, according to the filing. Strauss president Joseph Catalano also explained some of the reasons for the company's latest financial woes.

"Increased power, gas and fuel costs have caused consumers to delay vehicle service and replacement expenditures," Catalano said in a filing. "Mild winter weather also resulted in a disappointing 2011-2012 winter selling season and a subsequent decline in spring business due to a lack of winter driving conditions."

One would think that with people not being able to afford to buy as many new cars and keeping their old ones longer that car repair would be a booming business. Not so much, however, if drivers are becoming financially tapped out. It's scary to think that many people are putting off vital maintenance and that their cars may thus be more likely to break down in heavy traffic. Chalk it up as yet another dire example of our crumbling transportation infrastructure.


Bonus: From my You Tube channel - another little ditty about driving

States Explore New Ways to Tax Motorists for Road Repair

I've covered this topic before, but since the dumbass idea of taxing drivers for the miles they drive instead of just raising gasoline taxes won't go away, here it is again. USA Today has the story:

States are looking for new ways of taxing motorists as they seek to pay for highway and bridge repair and improvements without relying on the per-gallon gasoline tax widely viewed as all but obsolete.

Ummm..why exactly are gasoline taxes supposedly obsolete?
Among the leading ideas: Taxing drivers for how many miles they travel rather than how much gasoline they buy. Minnesota and Oregon already are testing technology to keep track of mileage. Other states, including Washington and Nevada, are preparing similar projects.

The efforts are being prompted by the fact that gasoline taxes no longer provide enough money to pay for roads and bridges — especially when Congress and many state legislatures are reluctant to increase taxes imposed on each gallon. The federal tax of 18.4 cents a gallon hasn't been raised in nearly two decades. More than half the states have not raised their gas tax this millennium. Fuel-efficiency also is behind the efforts. Electric-powered vehicles are growing in numbers. In 2009, President Obama set the nation's most aggressive fuel-efficiency standards for new vehicles, ordering a 40% increase by 2016.

"As the (national vehicle) fleet becomes more fuel efficient … we're going to lose a lot of revenue from the gas tax. If it's not replaced, we're going to see our transportation infrastructure deteriorate," says Joshua Schank, president of the non-partisan Eno Center for Transportation in Washington, D.C. He expects to see a state vehicle miles-traveled (VMT) tax within the next five to 10 years.

I assume from that quote that you only get to be the president of the non-partisan Eno Center for Transportation if you are either an idiot or a paid stooge for wealthy assholes who don't wish to pay their fair share in taxes. Here is what I wrote about this issue last November:

From privacy concerns, to the cost of administering the program, to the logistics of getting a monitoring device on every car, to the unaffordability of a lump sum annual tax payment--the whole concept is so riddled with real world practical flaws that it should have been rejected outright before it ever received coverage in the mainstream media.

Then you have the most obvious drawback of all in that this scheme PENALIZES people who buy fuel-efficient vehicles. After all, what fucking sense does it make from an energy conservation standpoint that a Hummer, which barely gets double-digit miles to the gallon, should be taxed at the same rate as a hybrid that gets 50 MPG, especially when the smaller, lighter hybrid is likely to cause less wear and tear to the roadways that then need to be repaired?

And, of course, I also wrote about the real reason why this horrible idea just won't die:

You don't think it might be because wealthier Americans, including the one-percenters who are the biggest campaign contributors, are the ones most likely to be driving those Hummers and other gas guzzlers, do you? Or that big business would get the contracts to manufacture and install the monitoring devices?

It really is incredible that such a cockamamie scheme is being contemplated just to avoid raising a tax that falls hardest on the wealthy. The sad fact is that the one-percenters are out to fuck the rest of us in so many different ways these days that it is difficult to keep track of them all.


Bonus: From my You Tube channel - another cool driving tune from Chicago indie rock troubadors, The Vulgar Boatmen

Truck Cancellations Hit Two-Year High As Rebound Slows

If the economy really is "recovering" maybe someone would care to explain this, as reported by Bloomberg:

North American heavy-truck orders are hitting a speed bump, with cancellations jumping to the fastest pace in about two years as a stagnating economic recovery prompts fleet owners to delay or scrap purchases.

The March rate shot up to 9 percent from 6.1 percent a month earlier, according to data compiled by Bloomberg. North American freight shipments fell 1.3 percent in March and grew less than 1 percent in April, according to Cass Information Systems Inc.’s Freight Shipment Index.
Buyers are being squeezed by slower cargo volumes, tighter credit and diesel fuel prices exceeding year-earlier levels even with recent declines. That may erode profits at truck makers such as Paccar Inc. (PCAR) and Navistar International Corp. (NAV), and damp the manufacturing rebound that has bolstered U.S. job growth.

It “creates a situation where these guys say, ‘You know what? I’m just going to hold on for a little bit and maybe cancel or move my order out a bit,’” said Eric Starks, president of Nashville, Indiana-based forecaster FTR Associates.

Preliminary April orders for Class 8 trucks added to evidence of a surprise slowdown by falling to the lowest since September 2010, according to FTR data. Continued weakening in orders may lower industry expectations, Peter Nesvold, a Jefferies Group Inc. analyst, wrote in a note to clients May 4.

That’s already happened at FTR. As recently as March, the firm was predicting Class 8 shipments of 285,000 units, or 12 percent more than a year earlier. It has since cut that estimate to 275,027 units, an 8 percent increase, as truckers delay purchases to refresh the oldest fleet since at least 1980.

Once again, which statistics do you trust, real world measurements like this or the politically charged data like unemployment and GDP that the media hypes relentlessly?

The Exurbs Are Slowly Dying

"The project of the American suburbs is the greatest misallocation of resources in the history of the world." - James Kunstler

Well, Jim, you have to be feeling pretty good about the recent vindication you received from an article that appeared last Friday in USA Today:

Almost three years after the official end of a recession that kept people from moving and devastated new suburban subdivisions, people continue to avoid counties on the farthest edge of metropolitan areas, according to Census estimates out today.

The financial and foreclosure crisis forced more people to rent. Soaring gas prices made long commutes less appealing. And high unemployment drew more people to big job centers. As the nation crawls out of the downturn, cities and older suburbs are leading the way.

Population growth in fringe counties nearly screeched to a halt in the year that ended July 1, 2011. By comparison, counties at the core of metro areas are growing faster than the nation as a whole.

"There's a pall being cast on the outer edges," says John McIlwain, senior fellow for housing at the Urban Land Institute, a non-profit development group that promotes sustainability. "The foreclosures, the vacancies, the uncompleted roads. It's uncomfortable out there. The glitz is off."

The fucking glitz? Pardon me for being so crude, but I live in a metropolitan area that is ringed by a huge band of exurbs that has been exploding over the past couple of decades. It is fucking UGLY, a vast wasteland of bulldozed fields and woodlands, tract homes, strip malls, megachurches, ribbons of new asphalt and horrendous traffic. What compels people to move to such godawful soulless places just so they have a bigger back yard is absolutely baffling to me.

There is perhaps no other phenomena the so clearly demonstrates just how far we have our collective heads shoved up our asses in this country than the exurbs. Think about it. America's rapid drive towards car-centric suburbification after World War Two was short-sighted enough, but at least then we had the excuse than we had never before experienced an oil shock. Then in the 1970s, we received two major shots across the bow in the form of the 1973 and 1979 Middle East oil supply disruptions. Those should have served as a warning that a automobile-dependent transportation infrastructure was ultimately not sustainable. So what did Spoiled Rotten Nation do in response? As soon as oil prices began to fall, we doubled down on our stupidity by building ever farther flung and even more car dependent communities as well as starting to buy gas hogging minivans and SUVs.

The building of exurbia, in fact, went into overdrive during the housing bubble years this past decade leading right up to the next major round of oil shocks. Instead of putting the brakes on sprawl as we were so clearly warned that we should do, we petulantly stepped on the accelerator and ran headlong right into the brick wall of peak oil and permanently high gasoline prices.

Nevertheless, this being a mainstream media article, it fudges on sounding any kind of warning about our real predicament:

"This could be the end of the exurb as a place where people aspire to go when they're starting their families," says William Frey, demographer at the Brookings Institution. "So many people have been burned by this. … First-time home buyers, immigrants and minorities took a real big hit."

During the '70s gas shortage and the '80s savings and loan industry crisis, some predicted the end of suburban sprawl. It didn't happen then, but current trends could change the nation's growth patterns permanently.

Aging Baby Boomers, who have begun to retire, and Millennials, who are mostly in their teens and 20s, are more inclined to live in urban areas, McIlwain says.

"I'm not sure we're going to see outward sprawl even if the urge to sprawl continues," he says. "Counties are getting to the point that they don't have the money to maintain the roads, water, sewer. … This is a century of urbanization."

First of all, Mr. McIlwain, the Millennials are not drawn to the cities because of any particular change in the American mindset. They are being drawn there becuase they are graduating from college with massive student loan debts into the worst jobs market since World War Two and thus they cannot AFFORD to buy a fucking house. Secondly, this isn't going to be the "century of urbanization." It is instead going to be the century of decentralization and economic collapse. When the day finally comes that the just-in-time delivery support systems for the urban areas cease functioning, both the exurbs AND the central metro areas are going to become very bad places to be for anybody.


Bonus: "How come...I can't tell...the free world from a living hell?"

Three More North Carolina Firms Closing

There have been quite a few mass layoff stories from North carolina as of late. Here is The Business Journal with the details:

LC Transportation Services, a Mount Airy-based trucking company that has been in business for nearly three decades, has shut its doors for good.

Saturday's closure of the trucking company — which employed 90 — comes as two other Mount Airy firms are shutting down operations.

General contractor John S. Clark, once one of the biggest commercial builders in the Triad, announced in a mid-March letter to customers that it was closing after failed negotiations for a management buyout. Harvest Time Bread Co., a national baker for the grocery and food service industries, is also closing its manufacturing plant in Mount Airy and cutting 57 local employees.

Phil Arrington, vice president of Mount Airy-based LC Transportation Services, said the company shut down due to a combination of issues, including rising fuel prices and costs for workers compensation and insurance. He also said a major customer cut their rates and contributed to the demise of the business, although he declined to name the business.

Arrington described the closing as a “death in the family,” adding that his employees were very disappointed.

“They didn’t work for us, they worked with us,” he said.

Hmmm...I wonder if that "major customer" was Walmart. If so, that wretched company is already fulfilling my prophecy of the other day about what passing on further price cuts will do to its suppliers.


Bonus: "Hell's on both ends of it...nowhere in between...this highway's mean"

High Gas Prices Eat Into Nonprofits' Funding

This story merely served as yet another reminder of just how precarious and dependent upon cheap gasoline so many of the more vulnerable members of our society really are. Here is delmarvanow.com with the details:

Rising gas prices are siphoning money the Food Bank of Delaware would rather spend to feed a record number of low-income families, at-risk kids and impoverished seniors.

“We definitely feel the impact,” spokeswoman Kim Kostes said. Every added $1 pumped into its trucks and vans could provide four nutritious meals, she said.
Gas in Delaware hit an average of $3.82 per gallon Sunday, and is expected to soon top $4 a gallon.

The food bank now is also working to raise the last $1 million effort for a $2.7 million to add a kitchen to expand its Milford site, serving southern Delaware, where need is growing fastest, she said. “Gas cards are great,” Kostes said, but money for operations and a new kitchen is also needed.

For nonprofits, rising gas prices mean not only higher costs for food and goods, but also a drop in donations, because people already suffering in the recession “just aren’t feeling like they have as much to give,” said John D. Baker, spokesman for the Delaware Association of Nonprofit Agencies.

The worst-hurt programs are those like the food bank and Meals on Wheels, which directly involve transportation or delivery, he said.

Some longtime volunteers at the Modern Maturity Center in Dover, where Meals on Wheels rolls out 700 meals each weekday, are starting to ask for help buying gas, said Executive Director Carolyn Fredricks.

Some volunteers have asked for shorter routes, some long routes have been split and there have been modest gas reimbursements when donations made them available, Meals on Wheels Deputy Director Ken Bock said.

Still, he said, paid staff members often end up doing a lot of deliveries that were done by volunteers before gas prices spiked.

Leaders of Delaware nonprofits say they already have been poaching from other budgets, doing more fund-raising and asking for gas card donations to help cover rising costs.

“We appreciate every bit of help,” said Newark Senior Center Executive Director Carla Grygiel. “We need it.”

Fuel costs are up 39 percent from last year for the center’s thrice-weekly member pick-up bus, she said. But the center is determined not to raise its $1 fare.

“We can’t raise our fees to our people who take the bus, because they are our most frail individuals,” Grygiel said, adding even a $1 fare “is difficult for some of them.”

Right now there is still enough latent wealth spread out around our economy to keep rising gasoline prices from turning into a potential humanitarian disaster. So what is going to happen when the day finally comes that those prices do rise to $5.00 or $6.00 a gallon or even more?

Spoiled Rotten Nation Not Sure Who To Blame For High Gas Prices

This is a good companion piece to my post the other day about a recent public opinion survey on energy issues that demonstrated how clueless the public really is. Spoiled Rotten Nation doesn't understand why gas prices are skyrocketing, and Spoiled Rotten Nation is plenty pissed off about it. Spoiled Rotten Nation just does not know who should get the blame, as this story from Yahoo Finance points out:

Families canceling vacations. Fishermen watching their profits burn up along with their boats' gasoline. Drivers buying only a few gallons of gas at a time because they can't afford to fill the tank.

From all corners of the country, Americans are irritated these days by record-high fuel prices that have soared above $4 a gallon in some states and could top $5 by summer. And the cost is becoming a political issue just as the presidential campaign kicks into high gear.

Some blame President Barack Obama. Some just cite "the government," while others believe it's the work of big, greedy oil companies. No matter who is responsible, almost everyone seems to want the government to do something, even if people aren't sure what, exactly, it should or can do.

A Gallup poll this month found 85 percent of U.S. adults believe the president and Congress "should take immediate actions to try to control the rising price of gas." An Associated Press-GfK poll last month showed 71 percent believe gas prices are a "very" or "extremely" important matter.

Once again, we see how meaningless public opinion polls are in regards to energy issues. It may come as a shock to 85% of the American public, but there isn't fuck all the president and Congress can realistically DO to reduce gasoline prices. The COULD repeal the federal excise tax on gasoline, which would lower the price by a whopping 18.4 cents per gallon. State legislatures, which the president and Congress do not control, could also help out by repealing all state gasoline taxes, which vary by state but average around another 18 cents per gallon. And that is the grand total of what the government could do, lower the price of a gallon of gas by less than 10% in the short term.

But then, guess what? There goes all of that tax revenue governments at all levels are expecting will help pay to build and maintain roads and highways along with running public transportation. Let America go a year or so without any road or highway repairs, and let's see how quickly the entire transportation grid collapses.

But Spoiled Rotten Nation doesn't want to hear it:

"When I go out to change the prices, they honk their horns and yell at me," said Siroub whose station's cheapest grade of gas, regular unleaded, was selling for $4.44 a gallon earlier this week. "The other day one person even gave me the finger."

Boy, you gotta love the visual image of an enraged driver flipping the bird to a gas station manager because he is forced to raise his prices just to stay in business. What is that fucker going to be like when gas finally does rise to $5.00 or $6.00 a gallon or ever more? Worse yet, what will he be like when gasoline starts to become unavailable at any price? Something tells me he isn't going to handle it too well.

The last guy they interviewed for the article does make an accurate statement in the middle of his cluelessness:

Shrimpers in Louisiana and lobstermen in Maine complain that high fuel prices are cutting into their profits. Craig Rogers, who burns through 50 gallons of gas a day tending his lobster traps along Maine's rocky coast, blames commodities traders, though he questions whether politicians are doing enough. He said politicians are too well off to really grasp what ordinary people are going through.

"They can say they feel for us, they can say they understand us, but when you have that kind of money, there's no way you can truly understand what we're feeling," he said.

No, Mr. Roberts, they don't understand what you are feeling. More importantly, they don't give a shit even if they may act like they do. But even if they did give a shit, there really is very little they can do. Yes, they've been lying to you about our energy predicament for 30 years, ever since Ronald Reagan defeated Jimmy Carter after the latter tried to tell the country the truth about peak oil. You and everyone else who is now whining about high gasoline prices didn't want to hear it then, and now you're all butt hurt about it.

As the saying from the old Fram oil filter commercial used to go: "You cay pay me now, or you can pay me later." Well, later has arrived and now reality has showed up at the door of Spoiled Rotten Nation waiving a huge bill in its hand, and it isn't going to go away until it gets satisfaction.


Bonus: How fitting is it that this commercial came out in 1981?

High Gas Prices Take A Bite Out Of "Meals On Wheels"

Back when I was in college I had job working in the dietary section of the public hospital in my hometown. One of the things we used to do was put together Meals On Wheels so they could then be delivered to needly elderly people in the community. It was a nice feeling to know that part of your job involved actually helping someone.

I hadn't thought about the Meals On Wheels program since those days, until I read this distressing story from a local South Dakota television station:

The high price of fuel not only affects families and businesses, but non-profit agencies as well. Volunteer drivers who deliver food to low-income elderly people are looking for answers from members of Congress.

Meals On Wheels driver Gayle Sagmoe has a VIP riding shotgun on her route: South Dakota Congresswoman Kristi Noem.

"It's the number-one issue that our office hears about right now, is gas prices," Rep. Kristi Noem, R-South Dakota said.

The 500-plus volunteer drivers with Meals On Wheels furnish their own vehicles and pay their own gas.

"I go probably average of 12-15-18 miles a day for a route; at $4 a gallon that's not going to go very far," Sagmoe said.

Drivers like Sagmoe worry that if gas prices climb too high, she may have to cut back on deliveries or stop volunteering altogether.

Unfortunately, the main interviewee for this article is looking for help in all the wrong places:

"I hope it doesn't because volunteering for me is the joy of my life, so I'm hoping and crossing my fingers that somebody will fix something and we can get prices back down," Sagmoe said.

Meals On Wheels hopes lawmakers like Noem can do the heavy lifting toward finding a solution to high prices.

"People are asking us, 'Why?' And simply, it's the uncertainty in the world and that we've got a lot of resources out in the country that we're not accessing," Noem said.

Sorry, Ms. Sagmoe, but your dingbat Congresswoman is far more interested in trying to score political points against Obama than she is in helping you. Because otherwise, she would explain to you that there is not much she, Obama or any other of our national "leaders" can do to bring down the price of gasoline in this era of peak oil. If she really wanted to help, she would suggest that the government provide a fuel subsidy for the Meals On Wheels program, because high gas prices are not only here to stay, they are going to get even worse in the future. But she doesn't want to do anything that might be construed as "socialism," so she'd rather look you in the eye and lie her ass off about all of the bountiful supposed resources America still has that for some inexplicable reason we refuse to access.


Bonus: Just because this story is from South Dakota, here is "Badlands"

GM Stops Building Chevy Volts For 5 Weeks--Lays Off 1,300

Lessee, according to Gas Buddy.com, the price of a gallon of the sweet stuff just topped $3.70 again, higher than it has ever been this early in the year. Gas prices have once again become a hot topic evidenced, as I pointed out the other day, by the number of mainstream news stories breathlessly warning of the impending possibility of $5.00-a-gallon gasoline by this summer.

Given all of that, you would think that newfangled electric cars like the Chevy Volt would be selling like hotcakes right now...and you would be precisely wrong. Not only are the cars not selling, GM is temporarily laying off the workers who build them. Here is USA Today with the details:

General Motors is stopping production of the Chevy Volt and European sibling Opel Ampera for five weeks due to slow sales.

"Even with sales up in February over January, we are still seeking to align our production with demand," said GM spokesman Chris Lee.

GM told the 1,300 employees building Volts at its Detroit Hamtramck plant that they will be laid off from March 19 to April 23.

Chevrolet sold 1,023 Volts in the U.S. in February and 1,626 so far this year. In 2011, it sold 7,671 -- short of its initial goal of 10,000. And GM had planned to expand production of the plug-in, extended-range electric car to 60,000 this year, with 45,000 for sale in the U.S.

So what exactly is the problem with this wonder vehicle that is supposed to solve all of our transportation-related energy problems?

The Volt is a technological "halo" car for GM, but also has been a political target. Critics have pointed to its $40,000 price tag and the federal subsidy of $7,500 plus state subsidies for people to buy one. They charge that the average buyer has a $170,000 household income and doesn't need to have a new-car purchase subsidized.

Sales also took a hit last fall when the National Highway Traffic Safety Administration opened a probe into why two Volts burst into flames days or weeks after severe NHTSA crash testing. NHTSA later deemed the Volt safe, meanwhile GM on Jan. 5 said it would improve the battery structure and coolant system.

I realize that the conservatives have been dumping on the Volt in order to try and score political points with their troglodyte base, and I have no desire to help them in that cause. But liberal and progressives also need to stop drinking the hopium surrounding the Volt and electric cars in general. They are NOT "green," because they for the most part run on the coal that fuels many of our electrical power plants. And they won't save us from Peak Oil because there is no way we could possibly generate enough electricity to power 250,000,000 of them. The truth of the matter is that the age of the passenger automobile, which is an historical aberration that has lasted only a little over a century now, has at most another decade or two to run before being consigned to the dustbin of history.

But hey, at least they build the damn things in America. That's something, right?


Bonus: Ballsy southern rockers Drivin'n'Cryin' rock Detroit

George Will Has A Rare Moment of Lucidity On High Gas Prices

Continuing on with the high gas prices theme from this morning's post, here's one for the You Really Can't Make This Shit Up file. This past Sunday conservative scold George Will, the very same guy who once labelled the idea of building more passenger rail service "collectivism," ripped Tea Party dipshit Representative Allen West and Newt Gingrich for blaming Obama for high gas prices. Here is The Raw Story with the set up:

Conservative columnist George Will says it’s “economic nonsense” for tea party favorite Rep. Allen West (R-FL) to blame President Barack Obama for the high cost of putting gas in his Hummer.

Writing on his Facebook page last week, West charged that Obama’s energy policy was “insidious political gimmickry.”

“Here is the bottom line, last night it took 70 dollars to fill the tank of my 2008 H3 Hummer, what is it costing you?” he asked.

And here is Will's exact quote:

“Allen West from south Florida, a Republican, said he was outraged this week because it cost him $70 to fill his car,” Will pointed out. “He drives a Hummer. Newt Gingrich said the American people have a right to demand $2.50 gas. They have a right to demand to lobsters grow on trees. I mean, this is economic nonsense.”

I never thought I would say this, George, but I agree with you completely. I only wish, in light of your own previous "economic nonsense" about collectivist mass transit, that one of the other panelists on your show had asked you exactly what bright ideas you have for addressing high gasoline prices. That would have been entertaining to watch.

Much as the know-nothing West in particular may deserve it, you can take this attack as a pretty obvious sign that the arrogant Will was speaking for establishment conservatives who have officially had it with the Tea Party.


Bonus: Allen West's car probably isn't what Billy Corgan had in mind when he wrote this song--but whatever

So What Happens If Gasoline Hits $5.00 A Gallon This Summer?

You gotta love the mainstream media. For months now the drumbeat has been about how the economic recovery in the U.S. is picking up steam, even though the only two indicators which are in agreement with that assertion are stocks and jobs, both of with are being relentless manipulated by the Federal Reserve and the Bureau of Labor Lying Statistics respectively. Nevertheless, despite the persistant propaganda designed to get the consumers suckers back into the malls and spending freely again, the media just can't resist the temptation to goose its ratings/readership/page views by doing a little scaremongering over rising gasoline prices. Numerous stories have appeared in the last week breathlessly proclaiming that gasoline prices will hit $5.00 a gallon by this summer.

You would think that someone would quickly spot the inherent contradiction here. After all, every recession since the 1970s has been preceded by a spike in oil and gas prices. But, surprisingly, you would be wrong about that, as shown by an article which appeared over the weekend on MSNBC.com. The title, "8 Reasons Why Gas Will Hit $5 a Gallon This Year," seems straightforward enough, but let's take a closer look at their supposed "expert" analysis. Here are the reasons from the article listed in order, followed by my commentary:

1. Strait of Hormuz
About 20 percent of the crude oil produced in the world is shipped through the Strait of Hormuz, and Iran has threatened to shut down shipping traffic through the Strait. At its narrowest, the passage is 30 miles wide, so there is a realistic case that a conflict could close it. Iran has already been isolated as a trade partner by U.S. and EU sanctions. The regime in the country has made a number of threats about what it might do if its “national interests” were threatened. If Iran follows through with its threats, the period the passage is closed could be very brief if the U.S. Navy, which has a carrier group in the region, moves to reopen the lane. But it is not clear that the American government would make that decision without the open support of allies or the United Nations. A closure of the passage, or any escalation that would make a closure more likely, will drive oil prices higher -- and by extension, gasoline prices.

No argument there. Tensions involving this key oil transportation checkpoint are certainly putting speculative upward pressure on prices. Let's move on.

2. Iran
Iran contributes to a second problem in terms of global oil supply well beyond that of its ability to interrupt supply. Because of the embargo against the nation due to nuclear weapons violations, the U.S. has pressured large oil importers such as Japan to act to isolate Iran by cutting their imports. This puts Japan in a position in which it has to tap even tighter global supply. Japan apparently has agreed to cut its Iranian crude imports by 20 percent. But as the world’s third largest oil importer, Japan indeed will have to get its oil somewhere other than Iran -- which will put more pressure on current production.

Not sure I agree with this one. The sanctions against Iran are laughably self-defeating given that China and India have shown no inclination to join the embargo against Iranian oil, and as long as Persian oil is being bought somewhere, there should not be any corresponding increase in world oil prices as that just means those two countries will buy less elsewhere.

3. Refiners raising prices
Most of the oil refined on the east coast of the U.S. is Brent crude, a type of oil produced from the North Sea. The price of Brent -- more than $124 a barrel -- is almost $16 higher than the price of West Texas Intermediate (WTI) crude, the amount most people read about in the media. But because Brent has replaced WTI as the global price benchmark, U.S. refiners set prices for gasoline and other products as if Brent were the only grade of crude used. That allows refiners with access to cheaper WTI to make larger profits.

However, when the prices converge, as happened in the final two months of 2011, WTI refiners lose their edge -- and their hefty profits. “Refiners were losing money in November and December. You can only lose money for so long,” John Felmy, chief economist for the American Petroleum Institute, recently said. Many large refineries are owned by public companies that do not have much appetite for posting ongoing losses. To avoid losses, refiners will have to increase gasoline prices.

Can't quibble with this one in light of the recent refinery shut downs in Pennsylvania and New Jersey, which certainly wouldn't have happened if they were turning big profits.

4. Other geopolitical risks
Iran does not present the only geopolitical challenge to oil production. In Nigeria, which is the 14th largest producer of oil in the world, Islamic terrorist group Boko Haram has continued to attack Christian areas of the country. The Nigerian Army has reacted by attacking Islamists. Militants have continued to attack pipelines, apparently in a move to disrupt the government.

This segment went on to mention Venezuela and other unstable Middle Eastern countries, but I've left that part out for brevity's sake. Again, no argument here.

5. The EU may save itself
For now, Greece has been bailed out again -- a move that should buoy confidence in the region and encourage demand for oil. Even with the Greek bailout, however, the eurozone is not out of the woods as nations continue to implement austerity measures to protect against the risk of default on sovereign debt.

Also edited down for brevity's sake. Can the EU muddle through for another year? Well, it pretty much muddled all the way through last year, so it certainly is possible.

But here is where things suddenly begin to go completely off track and way out into la-la land:

6. U.S. economic recovery
An improved U.S. economy means higher oil prices. U.S. GDP, employment and even housing have all staged unexpected improvements in recent months. Many economists now peg a 2012 GDP increase at more than 2 percent. The new White House budget assumes growth of 3 percent by 2013. An average of more than 100,000 jobs has been created in each of the past six months. And an extension of payroll tax cuts through the end of this year may further aid the employment recovery. An extension of unemployment benefits means that hundreds of thousands of American who would have no income, will have at least enough to consume basic goods and services. The argument that Americans now drive less is not a powerful one for gas and oil demand when a healthy economy also means more consumption of oil for business, petrochemicals and jet fuel. Demand for oil-based products across the entire economy will pick up with any recovery.

Even if you buy the recovery propaganda, how can any rational observer of the economy not realize what will happen to the American consumer well before gas prices hit $5.00 a gallon? Is 2008 really that far in the past that it has been completely forgotten? That year, gas prices topped out in July at a national average of $4.11, and the shock to the system was so traumatic that it helped trigger a deflationary crash across the financial sector. By January of 2009, gas prices bottomed out at $1.61 (figures courtesy of the chart above from Gas Buddy.com). Yet we're supposed to believe that prices shooting towards $5.00 wouldn't cause an even worse economic shock this time around?

But wait, it gets even more absurd:

7. Summer
In the U.S., summer vacation driving has historically boosted demand for gasoline. Over the past three or so years, however, that boost has been small, if present at all. In 2011, U.S. traffic volume decreased year-over-year in every month except January and February. But that was last year. So long as the U.S. economy continues to improve, more drivers will be on the road this summer.

Right here we see the blind spot of every economic commentator who uses the raw jobs figures to back up the claim of economic recovery. Are there more jobs now than there were a year ago? Undoubtedly. Are most of those newly created jobs the kind of stable, good paying positions which would allow their holders to take a couple of weeks off this summer and take the family out for a long driving vacation? Unlikely. It seems like many of those who get paid to write articles like this one in the mainstream media think that everyone who has a job is as comfortable and well off as they are.

8. Supply risk
In December 2011, OPEC members produced nearly 31 million barrels a day, cutting the cartel’s spare capacity capability from 3.18 million barrels per day to 2.85 million. Saudi Arabia accounts for 2.15 million of those daily barrels of spare capacity.

Again, edited down for brevity. Maybe Saudi Arabia has that spare capacity. Maybe it doesn't. No one outside the desert kingdom really knows for sure. But at least the article ends on a more sensible note.

To sum up, there are a lot of very good reasons to believe that oil and gas prices are going to rise higher in the coming months, but reasons six and seven listed above are absolutely laughable in their absurdity. The fact that they were included in an otherwise relatively astute analysis shows just how powerful the propaganda spewed forth by the Hologram really is.

What will happen if gas prices hit a nationwide average of $5.00 a gallon this summer? Personally, I think that absent a war with Iran we're not going to find out. Because while the economic free fall we experienced in late 2008 and early 2009 was halted by the enormous increase in federal deficit spending and the loose monetary policies of the Federal Reserve, the economy is far too fragile withstand prices surging to that level. Almost certainly, another financial market crash will short circuit the rise in gas prices well before they reach those lofty heights, at least for this year.


Bonus: "Putting out the fire with gasoline"

Yet Another Oil Refinery is Shutting Down

On January 27th of this year, I posted a story about a ConocoPhillips oil refinery in New Jersey shutting down. Well, now comes word that a Sunoco refinery near Philadelphia is also closing up shop. Here is NBC 10 Philadelphia with the details:

Officials at a Sunoco refinery near Philadelphia say about 100 employees are being laid off at the end of the week.

The workers at the company's Marcus Hook plant in Delaware County were given layoff notices saying Friday would be their last day, reports the Delaware County Daily Times.

Sunoco spokesman Thomas Golembeski said Tuesday that the hourly employees were told not to return because the first phase of the plant decommissioning process has been completed. But he says the workers will be paid their wages through the end of the month.

Sunoco said last year that it would idle the refinery and lay off about 490 employees because of deteriorating market conditions. Another Sunoco refinery in Philadelphia is expected to close by July if a buyer isn't found.

And all the politicos can do is whine about it:

Pennsylvania politicians urged Sunoco CEO Brian MacDonald to find a buyer for the facilities.

"With so many jobs on the line and the risk of higher fuel prices for consumers across the northeast, Sunoco and ConocoPhillips must be held accountable for the impact refinery closures would have on the region," said Sen. Bob Casey (D-Pa.) in a letter sent Wednesday. "We need these companies to be more transparent with workers and the public as they contemplate decisions that could have very damaging impacts not only on the local communities but on the entire northeast."

What a pathetic, pandering little worm. Do you really think these refineries are closing because the companies are deliberately being mean, Senator Casey? Or that they wouldn't sell the refineries if they could actually find buyers for them? They're shutting these refineries down because they can no longer turn a profit with them, for whatever reason. The implications of that fact ought to be as clear as they are dire. And you'd be much better off telling your constituents the truth instead of continuing to blow smoke up their asses.


Bonus: Bad boy that he was, Pennsylvania would still likely be better off with the fictional Senator Bob Roberts

Finally, Some Good News: Congress Ends Ethanol Subsidies

One of the dumbest public policy decisions made in recent years was the subsidy paid by the federal government to ethanol producers. Not only did the subsidy directly contribute to the national debt, it helped drive up the price of corn, which is one of our most basic food staples. It also artificially suppressed the price of gasoline, and if there is one thing government policies should NEVER do in this peak oil era, it's encourage people to use more oil and gas than they would otherwise. Here is USA Today with the details:

Gasoline could cost 4.5 cents a gallon more starting as early as this week, and it's not because of rising oil prices.

It's because Congress declined to renew the 30-year-old federal subsidy for ethanol, letting it expire Sunday.

Ethanol, denatured grain alcohol used as a proven smog-cutting ingredient, currently makes up 10% of most gasoline-based motor fuel for general use, so-called E-10. In a few areas, E-85 fuel, 85% ethanol, also is available. E-85 can be burned only by vehicles equipped for "flex fuel."

How much the end of the subsidy could add to gas prices, and how soon, is yet to be seen. Ethanol blenders got a 45-cents-a-gallon tax credit, which amounts to 4.5 cents for the amount blended into each gallon of E-10 fuel.

It's hard to calculate the immediate impact. Oil prices and ethanol stocks are in flux. And unknown is the impact of another move by Congress: dropping the 54-cents-per-gallon tariff on ethanol imports. Brazil is a leading global producer of ethanol made mostly from sugar cane.

In the U.S., ethanol primarily is made from corn. That has made the ethanol subsidy controversial because of allegations that it raised food prices. The estimated $6 billion annual cost of the subsidy also has added to the federal deficit.

Of course, they had to go and diminish the positive effect on the nation's balance sheet by also eliminating the tariff on Brazilian ethanol, but at least this is a step in the right direction.


Update: I stand corrected on this actually being good news. See reader bmerson's comment below and my response.

What's the Matter With the Electric Car?

Very few people want to buy them, actually. Here is MSNBC with the details:

If the White House hopes to meet its ambitious goal of putting 1.5 million battery cars on the road by mid-decade it better hope that 2011 wasn’t a good indication of what Americans think of electric vehicles.

Add them all up, hybrids, plug-ins and pure battery-electric vehicles, or BEVs, and they accounted for little more than 2% of the U.S. automotive market last year. Remove conventional gas-electric models, such as the Toyota Prius and Ford Fusion Hybrid, from the equation and more advanced battery vehicles generated barely 20,000 sales.

“I’d say they failed,” proclaims Joe Phillippi, chief analyst with AutoTrends Consulting.

Ouch...harsh. So if they failed, as Mr. Phillippi says, WHY exactly did they fail?

...they aren’t cheap, battery vehicles saddled by price tags that are thousands – in some cases, tens of thousands – of dollars more than comparable gasoline vehicles.

That might make sense had fuel prices held at the near-record levels seen in early 2011, but gas has dropped sharply since then. Meanwhile, manufacturers have been making major strides when it comes to the fuel efficiency of conventional, gas-powered vehicles. In the compact segment where Ford will compete with the Focus Electric, for example, 40 mpg on the highway is the new norm.

Both government bureaucrats and electric vehicle manufacturers, says analyst Sullivan, “aren’t giving consumers credit for being able to do the math. It just doesn’t make economic sense” to buy an electric vehicle – at least if your primary goal is to save money by reducing your energy bills.

There are, of course, other reasons. There’s the desire to clean up the air and to curb oil imports, especially from the Mideast. But whether that can be used to draw more buyers into the market remains to be seen. Especially in this economy, value is the big motivator, rather than politics and social concerns.

Oh, no shit? You mean that very few people other than a handful of greenie-minded, upper middle class yuppie types actually takes such things as the environment or Middle East oil imports into consideration when making a major purchase like a car? For that brilliant observation, let me present you with the coveted Dr. Obvious award. I'm not saying it's right, but it is a fact of life that most people make purchasing decisions based upon the bottom line to their pocketbooks.

I wrote back in June on this blog about how when I was ready to purchase a new vehicle after nine years and ultimately decided on a Ford Escape, that I chose to go with the conventional gasoline powered model rather than the hybrid because the latter cost nearly $6,000 more (and there was a three month waiting list for the hybrid). Six months later, I've put just over 5,000 miles on the car, meaning I would have to drive it for many more years to make up the cost difference between the purchase price and what I would have saved on gasoline.

The sad fact is that the time for America to start transitioning to electric vehicles was 20 years ago or more before we began staring the peak oil crisis right in the face. Even if President Hopey-Changey's unrealistic goal of 1.5 million EVs on the road by the middle of the decade is met, that is less than one percent of the total and still leaves something on the order of 250 million gasoline powered vehicles still out there.

There is also the problem that even if every car were suddenly magically converted to being an EV, the power grid couldn't handle charging them all. Additionally, much of our electricity comes from coal fired power plants, and coal is also not only also a fossil fuel but a bigger contributor to global warming than oil. You wouldn't think it would be necessary to have to keeping repeating all of that, but sadly it is because so few people seem to realize it.

I suspect that going forward EVs will remain a niche product purchased mostly by select members of the upper middle class in a desperate attempt to keep their car-centric lifestyles going as long as possible. But I doubt that ultimately they will have a future that lasts much longer than their gasoline powered counterparts.


Bonus: The Boss's Chevy wasn't a Volt, that's for sure

Peak Vehicle Miles Travelled Shows the True State of America's Economy

Related to this morning's post, I ran across the above chart of annual vehicle miles traveled (plotted monthly by 12-month average) the other day on the excellent Gregor.us peak oil blog. As you can see, from the mid-1980s (just after world oil prices collapsed after hitting their initial peak in the late-1970s due to greater fuel efficiency in the United States and the coming online of the last "supergiant" oil fields in Mexico, Alaska and the North Sea) until 2008 total annual vehicle miles driven in the United States climbed steadily upwards with no significant break. All told, they actually increased by an astonishing 66% during that period.

The spiking of gasoline prices above $4.00 a gallon in the summer of 2008 and the resulting market crash that fall led to the first significant drop in miles driven in over two decades. Since then, the number has struggled to recover and actually appears to be getting ready to dip again.

Forget the stock market, or the GDP numbers or the manipulated official unemployment statistics, this chart is a much more reliable indicator of the state of the real economy. Except for a small portion of the population who live carless in the big cities, personally owned vehicles are absolutely essential for most people to engage in economic activity. Moreover, most goods are transported to their point of sale via trucks.

Clearly, this chart shows that the government's response to the economic crisis--massive amounts of unsustainable federal deficit spending--merely arrested the crash of the real economy and is holding it in a state of suspended animation. How much longer that effort can keep propping things up is anyone's guess. Sooner or later the sharp drop in annual vehicle miles driven is going to resume, along with a resumption of the economic crash.


Bonus: There are a lot of great driving songs that celebrate the all-too-brief and dying era when Americans could just take to the road whenever they felt like it. But my favorite is this little 1989 gem from the criminally unappreciated indie-rock band, The Vulgar Boatmen.

The Proposed "Pay-Per-Mile" Tax is a Shockingly Dumb Idea

I've written on this blog before that one of the biggest problems with our complex modern industrial society is that a substantial portion of the population is fundamentally incompetent, even in areas in which they are supposedly expert. Case in point is a recent suggestion put forth by so-called transportation "experts" as to how to solve the severe underfunding of the nation's federal highway fund, as reported the other day by CNN:

Drivers often forget that they pay for highway construction and maintenance through federal fuel taxes: 18.4 cents per gallon for gasoline and 24.4 cents per gallon for diesel. "The notion that the road has ever been free is sort of a self-delusion," said Neil.

But the fuel tax is running out of steam, experts warn, because more efficient vehicles are using less fuel and rising fuel prices discourage driving. As tax revenue falls, so does the nation's ability to pay for road construction and maintenance.

The solution, say many transportation experts, is to replace -- or supplement -- fuel taxes with a per-mile tax on every vehicle in America.

Okay, so how exactly would such a harebrained scheme work, anyway?

Imagine 254 million vehicles.

That's the number of cars, trucks and motorcycles that a tax per mile system would have to monitor.

Some proposals call for using GPS satellites to gather mileage data on each vehicle.

Whoa. Really?

When it comes to tracking their vehicles, Americans tend to be really touchy about protecting their privacy.

According to a University of Iowa poll, only about 20% of drivers would choose a pay-per-mile tax system if GPS tracking is involved.

The anonymous driver will soon be an extinct species, says Neil.

"You can't drop off the grid. Ten years from now, it will be virtually impossible to drive a car that doesn't have an electronic signature," said Neil.

"It doesn't matter whether you have OnStar or you rent a car -- it's going to have a 'black box.' If you've got any kind of navigation, The Man -- with a capital M -- knows where you are."

University of Iowa research shows that the public would be more willing to accept per-mile taxes if its monitoring technology doesn't record a vehicle's specific location.

Taking your vehicle to have someone read the odometer every year -- like some states do with emissions testing -- might be an option.

But some experts fear that method might be too expensive. Also, the resulting once-a-year tax bill might be too much for some drivers to pay.

One idea tested in Minnesota eliminates GPS and uses cell phone text messaging technology.

During fuel stops at gas stations, a device that already exists in most cars would text the car's mileage information to a "back office" data base.

The office would then adjust the price of fuel at the pump based on each vehicle's mileage driven.

Implementing any system would be tricky, says Paul Hanley, who headed the Iowa study. Retrofitting existing cars with the required technology would be almost impossible, he says.

The cheapest and least difficult option says Hanely, would be to install devices in new cars and slowly transition to the new system as the nation's entire fleet of vehicles turns over.

It takes about eight years before 90% of our vehicles are turned over, Hanley says, and more than 10 years to convert the fleet to nearly 100%.

"It's inevitable," says Hanley, who's been conducting a real-world test of a pay-per-mile system with more than 2,500 drivers in 12 locations from coast-to-coast. Per-mile taxes "with a combination of tolls is coming as we move away from the fuel tax."

Sorry about the length of that excerpt, but I felt I had to include it all to demonstrate just how breathtakingly stupid this whole idea is. From privacy concerns, to the cost of administering the program, to the logistics of getting a monitoring device on every car, to the unaffordability of a lump sum annual tax payment--the whole concept is so riddled with real world practical flaws that it should have been rejected outright before it ever received coverage in the mainstream media.

Then you have the most obvious drawback of all in that this scheme PENALIZES people who buy fuel-efficient vehicles. After all, what fucking sense does it make from an energy conservation standpoint that a Hummer, which barely gets double-digit miles to the gallon, should be taxed at the same rate as a hybrid that gets 50 MPG, especially when the smaller, lighter hybrid is likely to cause less wear and tear to the roadways that then need to be repaired?

One question that the CNN stenographer reporter should have immediately asked Mr. Hanley is, why exactly are we "moving away" from the fuel tax when raising it seems to be a far more simple solution? Actually, the reporter does at least mention the possibility a bit farther down in the article:

The best and least complicated solution is to raise the fuel tax, which hasn't changed since 1993. But that idea comes with its own set of political challenges. Many members of Congress would likely oppose any kind of tax hike.

Oh, so we're supposed to unquestioningly swallow the idea that Congress would oppose any sort of increase in the fuel tax, but would merrily go along with a complex and damn near unworkable scheme such as this? Okay, I'll play along. Maybe they WOULD in fact agree to implement this idea. If so, why do you suppose that would be? You don't think it might be because wealthier Americans, including the one-percenters who are the biggest campaign contributors, are the ones most likely to be driving those Hummers and other gas guzzlers, do you? Or that big business would get the contracts to manufacture and install the monitoring devices? Man, and I thought I was cynical.

The only good news here is that it is extremely unlikely that America's car-centric, business-as-usual economic model is going to hold together long enough for this nefarious scheme to be implemented. I merely highlighted it to serve as yet another example of how the elites and their totally compromised so-called "experts" are deviously and tirelessly thinking of new ways to fuck over the rest of us, even if the idea in question clearly shows just how incompetent they are.

Friday Rant: Chrysler's New $40,000, Gas Guzzling Boondoggle

You would have thought that when the Obama administration raped the taxpayers used taxpayer money to bail out dinosaur automakers GM and Chrysler that at the VERY LEAST it would insist that the two companies get serious about focusing on building more fuel efficient cars. After all, gasoline prices spiked to above four dollars a gallon the summer before the Mighty O's election, and the resulting market crash was a big factor in the country consenting to be governed by a guy whose last name is merely one letter away from "Osama."

Well, if we've learned anything about President Hopey-Changey these past three grueling years, it's that he will doing ANYTHING to maintain the illusion of business as usual and won't lift a finger to change the ways of big corporations, even after giving those corporations billions of dollars to save their asses. The latest example of this depressing dynamic in action was reported this week:

The special edition Wrangler will hit showrooms next month for a manufacturer’s suggested retail price of $36,495 for the two-door model and $40,070 for the four-door (Jeep Wrangler Unlimited) model, not including destination fees. Regular 2012 Wrangler models start at $22,045.

Sounds like just the kind of vehicle we need on the roads to reduce our dependency on foreign oil, doesn't it? Paint that sucker lime green while you're at it, cause that's a "planet-saver" right there.

But wait, it get worse when you consider the mentality of the people to whom they are trying to sell this new monstrosity:

Chrysler Group LLC is taking its Jeep partnership with video game publisher Activision to a whole new level with "Call of Duty: Modern Warfare 3," according to officials.

In preparation for the game’s midnight release, the Auburn Hills-based automaker Monday launched a “groundbreaking campaign for the 2012 Wrangler Call of Duty: MW3 Special Edition.”

“This is more than an advertising campaign, this is a true experience that captures the excitement one feels when playing ‘Call of Duty: Modern Warfare 3’ and when driving the all-new 2012 Jeep Wrangler Call of Duty: MW3 Special Edition,” said Olivier Francois, Chrysler chief marketing officer.

The campaign dubs the Wrangler as, “The toughest vehicle in the world. Any world.” Ads will introduce the new tagline, as well as the soon-to-be released special edition version of the brand’s popular vehicle.

That's right, Chrysler took your tax money and mine so it could develop a car that costs more than one-and-a-half times the median annual American income in order to sell it to well-to-do alleged adult human beings who spend much of their free time playing a hyper-violent video game. Can you say, "professional athletes?" I KNEW you could! By the way, I seriously doubt that anyone with a highly pretentious name like Olivier Francois would ever be caught dead doing something as lowbrow as playing Call of Duty video games.

Have you never had the "pleasure" of playing one of the Call of Duty games (I haven't), the image above of a modern city being blasted to pieces is a screen shot from it. Not that I don't have my own guilty pleasures, but none of them have ever filled me with a burning desire to go out and buy an outrageously expensive car to advertise the fact that I have too much money and not enough brains.

Worse yet as far as real world effects on our dwindling oil supplies go, according to the Department of Energy this new $40,000 monstrosity will get exactly 17 MPG in the city and 21 MPG highway. I hate to break it to the many delusional souls who will no doubt rush out to be one of the first to own one of these hideous abominations, but when the gasoline supplies run out in the not-too-distant future, you are not going to be the badass hunter, but rather the sitting duck hunted. Because in real life, the game is played for keepsies.

What Do the Working Poor Need? More Cars!

Stop the presses! I have officially found the winning entry for the year's foremost example of sheer mainstream media idiocy, personal finance category.

First let me set the table on this one. It is an obvious fact that public transportation in America is woefully inadequate. Unless you live in one of the larger cities, you may well not have any access to such transportation, and even most of the larger cities lack anything as basic as a subway system. Moreover, owning and operating a personal vehicle is a huge drain on the finances of anyone who earns less than the median per capita income of just over $26,000 per year.

No doubt this is a persistent problem for the working poor, who must somehow get to their jobs, go shopping for food and necessities and get their kids off to school every day. A common sense solution would be to do a major overhaul and expansion of our public transportation system, expensive as that would be. But common sense be damned, the Los Angeles Times has a better idea, give those poor people cars:

For more than a century, efforts to help the disadvantaged have focused on education, healthcare, nutrition and housing. Almost nothing has been done to help the working poor afford cars, despite research that indicates it would help alleviate poverty.

About 1 in 4 needy U.S. families do not have a car, according to the Annie E. Casey Foundation. That's a serious handicap for the millions of Americans who don't have access to robust mass transit.

A nationwide survey of 353 people who bought cars with help from a nonprofit group called Ways to Work found that 72% reported an increase in income. Of those who were on public assistance when they acquired a car, 87% were no longer receiving it a few years later.

Other studies have found that low-income people were more involved in community activities and had better access to healthcare after getting cars, while their children participated more frequently in after-school programs.

"You're more likely to have a job and less likely to be fired," said Evelyn Blumenberg, a professor of urban planning at UCLA who studies transportation and poverty. "It's just a no-brainer that low-income families need cars."

Not to be churlish or anything, but UCLA professor Evelyn Blumenburg is a shining example of why America's educational system is deteriorating so rapidly. No, professor, it is NOT a "no-brainer" that these families need cars. It IS, however, a no-brainer that they need access to an adequate public transportation system.

I would sure like to know exactly when the alleged "studies" that show low-income people being better off after getting cars were conducted. In the summer of 2008 or this past year when gas prices shot far above $3.00 a gallon? Or perhaps, as I suspect, back when gasoline was still cheap? Because maybe you haven't noticed this, professor, being stuck up their in your ivory tower and all, but conditions on the ground in the real world have changed dramatically these past few years.

Even more asinine is this little nugget:

Yet there are almost no state or federal programs to meet the need.

The U.S. Transportation Department plans to spend $71 billion this fiscal year on roads and bridges, $22 billion on public transit and more than $8 billion on rail projects, but has allocated no money to help put the poor behind the wheel.

Under the Community Reinvestment Act, the Federal Reserve encourages banks to provide loans to struggling farmers, disadvantaged people hoping to buy homes and small businesses that want to expand — but not to people who need cars to work.

Wow--that is the first time I have ever seen it advocated that it is the federal government's responsibility to make sure people have cars. That is really taking fuzzy-headed, business-as-usual thinking to a whole new level.

But wait, it gets even more absurd. Here is a surreal quote from once of our so-called "leaders" as to why it is better to enable poor people to buy cars than to spend the money on public transportation:

Rep. Gwen Moore (D-Wis.) has tried for years to get the government to help the poor buy cars. In 2005 and again in 2007, she sponsored legislation to provide $50 million a year for low-income car ownership programs. Both bills died in committee.

She said she has faced resistance from, among others, environmental organizations that insist mass transit is a better solution.

"Public transit is not practical in Milwaukee where the wind chill can be 45 below and you have to drop three kids off at day care," Moore said. "We really have a crisis with respect to getting people to their jobs."

See why we can't have public transportation? Because it's COLD outside sometimes. Geez, why didn't I think of that? I'm such a heartless bastard.

Maybe it's because I grew up in a town not that far away from Milwaukee, and as a child actually had to WALK over a mile to school (what a concept!). And guess what? On those blustery, below-zero winter mornings, well goddam if my mom, instead of coddling me by driving me to school, simply made sure I had on a heavy winter jacket, boots, a scarf and a stocking hat. And I survived! And I didn't even ONCE get frostbite!

I swear I read this article this morning and my head almost exploded. It would have been one thing had this breathtakingly idiotic drivel been published a decade ago when gasoline was still $1.20 a gallon. But now it is nearly three times that price and is only going to go higher over the long term. And that doesn't even include the soaring cost of vehicle maintenance these days, or the rapid deterioration of America's bridges and highways. If the working poor are having trouble being able to afford to keep a car running now, they are going to find it well nigh impossible when gasoline rises to $4.00, $5.00 and even more in the coming years.

I hate to say this, folks, but this kind of thinking, which has not abated one little bit despite the recent major oil price shocks, is exactly why I am convinced that the collapse of the American economy is a foregone conclusion.

Fear and Loathing in the Auto Industry: The Flacks Can’t See What’s Right in Front of Their Eyes

One of the most shortsighted policies enacted by our so-called “leaders” in response to the financial crisis was the bailout of the automobile industry. The end of the cheap oil era and the onset of the world wide peak in oil production means that the long term trend in gasoline prices is heading in one direction: up. Additionally, the economic devastation the crisis has wrought among so many working and middle class Americans means that many will likely never again purchase a new car during their lifetimes. For those of us who are Peak Oil aware, these are accepted facts that are beyond dispute.

So it was with great interest yesterday that I read an article from Fortune magazine entitled, “The Incredible Shrinking Auto Boom.” I actually got excited for a second, thinking that maybe this was an example of a mainstream media publication actually beginning to report our true predicament. How silly I was. Nevertheless, things started off promisingly:

Fears of a global recession, brought on by slowing China growth and financial panic in Europe, are dampening hopes for a strong U.S. recovery in auto sales.

That could have consequences that ripple far beyond Detroit, Wolfsburg, and Toyota City.

Ummm…yup. Anyone with two brain cells to rub together should have been able to foresee that, please continue:

Until very recently, autos have been holding up as one of the few bright spots in U.S. manufacturing. New assembly plants are opening and automakers are adding to their payrolls. Autoworkers have entertained visions of fat profit-sharing checks as they concluded contract negotiations with GM and continue them at Chrysler.

What’s amazing about the quote above is how quickly Americans seemed to forget about the oil price spike of 2008, and started buying new cars again as soon as gas prices plummeted in the wake of demand destruction caused by the effects of the Great Recession. The chart above shows that auto sales WERE starting to recover. Apparently, though, none of the optimists were taking note of the fact that gasoline prices began to relentlessly march upwards again late last year, or perhaps they might have dampened their enthusiasm. It is on exactly this point that the author of this article, who has the unfortunately aristocratic sounding name of Alex Taylor III, really demonstrates his stupidity:

As recently as April 25th, I wrote approvingly about anew forecast from IHS Global Insight that had car sales under one scenario climbing steeply to 17 million by 2015. It foresaw a healthy economy expanding at roughly 3% per year and creating two million new jobs annually. Its reasoning was that years of below-average sales would create pent-up demand that must be satisfied as long as automobiles remain a primary mode of transportation.

Wow…talk about an example of why you should never; EVER take financial advice from a mainstream media publication. According to my buddies at GasBuddy.com, the average price of a gallon of gasoline on April 25th, the very day Sir Alex Taylor III wrote his unfortunate bit of optimistic prognostication, was around $3.85, a mere quarter from its all time high in the summer of 2008. Was Alex Taylor III completely asleep during that whole time and does he really not recall how the financial system imploded less than two months after they hit their peak that year?

I guess, being a Senior Editor at Large for Fortune magazine (a title which kind of makes him sound like a bank robber on the lam), Mr. Taylor III doesn’t get out much. Or at least, he doesn’t get out much to neighborhoods where people actually work for a living. If he did, he might recognize that working and middle class Americans are struggling with layoffs, bankruptcy, foreclosures and related maladies, and hardly have the excess spending money to be able to afford to run annual auto sales back up into the 17 million range.

As the article continues, Mr. Taylor III actually interviews another, more “pessimistic” analyst:

Independent analyst Warren Browne of Automotive Compass has been figuring on 2011 sales coming in around 12.5 million since February. Based on some new work he has done that ties auto sales to GDP growth, he sees 2012 sales stalling at 13.2 million. He's assuming annual GDP growth of only 2.5% for the rest of the decade and autos not peaking in the current economic cycle until 2019.

"The current automotive cycle is operating below trend," Browne writes. "There is not enough economic support to alter this path for at least a few years.

You see the problem? Even when these people are supposedly being realistic, they still don’t have a clue what the fuck they are talking about. Annual GDP growth of 2.5% for the rest of the decade? Auto sales peaking in 2019, when worldwide oil production will likely already be in steep decline from today’s levels? Sorry, Mr. Browne, we’ll be lucky if there still IS an American auto industry by 2019.

Reading this article served as a good reminder just how pervasive business-as-usual thinking is despite all of the mounting evidence that we have reached a key turning point in our history in which economic growth is finished. The likes of Alex Taylor III and Warren Browne will no doubt continue to spew their nonsense until the day finally comes that they lose their own jobs and reality finally pierces the media bubble of their own creation.