Today the price of oil is $140 a barrel. The average cost of gasoline per gallon is over $4 a gallon.
Who’s losing in this and who is winning? Unfortunately, both are pretty obvious. It’s also pretty obvious not everyone is taking it sitting down.
- The Unemployed: In June, Continental Airlines laid off 3,000 workers and grounded its most fuel inefficient aircraft because of the high gas costs. As environmentalists, we may cheer because it’s less carbon emissions into the atmosphere, but to the laid off its “Good bye paycheck, good bye benefits” and “Hello unemployment and making ends meet.” They have families to support and it just got a lot harder.
- The Disenfranchised: Rural parts of the South and the Mid-West are being hit hard as consumers have to choose between buying food, paying medical bills or driving to work!
- The Defiant: Truck drivers are staging work stoppages in protest as they can’t make a living because of the high cost of gas. Students in the Northeast and the South are walking out of school and biking in protest of high gas prices. There is much more resistance to the economic injustice of high gas prices occurring as well.
- The planet: Bush and the right’s solution is to begin offshore drilling. Offshore drilling could cause even more irreparable harm to eco-systems, communities and the climate
The mood of the country is grim and angry over this. Author David Sirota rightfully points out in his new book The Uprising that the populace in the U.S. hasn’t been this disenchanted with it’s leaders since the 1970’s and a key difference from that period is that we aren’t just upset with the politicians, but also the corporations and Wall Street.
These protests and spreading unrest are growing out of problems inherent in American social and economic structure.
While working Americans, dependent for so long on their cars for mobility and necessity, are being gouged at the pumps, who is profiting?
Oil companies. In the past few years, Exxonmobil, Chevron, Shell and many other members of Big Oil have been making record profits.
They’ve always been at the top of the pyramid, but the past few years it’s exceeded anything in the past. Businessweek recently published article on oil executive paychecks. For the article, they commissioned a study on the compensation of the top 25 oil and gas firm’s executives. Here’s some of what they found:
“Equilar’s study found that for the 12 CEOs at the largest U.S.-based, publicly traded oil companies, median total compensation increased by more than four times the rate of that of executives in the Standard & Poor’s 500-stock index as a whole.”
Four times! It’s not just a class struggle between the super-rich and the working poor, but also between oil execs and the rest of the business class.
It’s not a 2008 phenomenon either. When former Exxon CEO Lee Raymond retired in 2006, he got a $400 million retirement package. (Pretty good deal for a career in undermining climate science and controlling resource rich foreign governments.) We can curse and protest them, but executives always get their “Golden Parachutes.”
Of further interest, the Washington Post published a story about lobbyists from banks like Goldman Sachs and Morgan Stanley go on the offensive trying to stop congressional regulation of oil speculation. So it’s not just the oil companies responsible for this, but the greater international economic structure of supply and demand around petroleum.
Something is wrong here and we need to look for greater change. The political winds are changing. The Bush-Cheney Neo-Conservative junta is on their way out. Conservative congressional districts in the South and Mid-West are electing Democrats over Republicans. The Republicans see no safe seats in November.
And while the country is on track to see a new generation of Democractic power-holders, we as organizers and activists need to keep in mind that change comes last to Washington and never ends with a politicians. This change needs to be bottom-up, systemic and long term.
While we need federal legislation and regulation to right many of the wrongs of the Bush era (and the Clinton era for that matter), we need to continue to build our movements with grassroots organizing, solidarity with marginalized communities and direct action (not necessarily chaining yourself to your local gas pump, but organizing a DIY movement).
Being happy about high gas prices causing less environmental damage is short sighted. Working people are suffering and oil execs are getting richer. It’s nice when GM closes a Hummer plant, but not nice when 10,000 people are laid off. As people working for environmental justice and the climate, we need to incorporate true principles of unity and solidarity with those fighting for economic justice.
We should heed the wisdom of William Gladstone- “All the world over, I will back the masses against the classes.”
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Very interesting article!
I agree with all your comments that the working class should not suffer.
There was a testimony given to the Committee on Homeland Security and Governmental Affairs United States Senate by Michael Masters (long-short equity hedge fund manager). His evidence shows that commodity (oil) futures and holdings are more controlled by institutional investors than ever before. Collectively, these institutional investors would include Corporate and Government Pension Funds, Sovereign Wealth Funds, University Endowments and other Institutional Investors.
http://qualitytw.blogspot.com/2008/06/are-institutional-investors.html
I believe this is true because there does seem to be plenty of supply. It isn’t like in the 1970’s when we supposedly ran out of gas and there long, long lines waiting at every station to pump gas .
Very interesting article!
I agree with all your comments that the working class should not suffer.
There was a testimony given to the Committee on Homeland Security and Governmental Affairs United States Senate by Michael Masters (long-short equity hedge fund manager). His evidence shows that commodity (oil) futures and holdings are more controlled by institutional investors than ever before. Collectively, these institutional investors would include Corporate and Government Pension Funds, Sovereign Wealth Funds, University Endowments and other Institutional Investors.
You can see more explaination here:
http://qualitytw.blogspot.com/2008/06/are-institutional-investors.html
I believe this is true because there does seem to be plenty of supply. It isn’t like in the 1970’s when we supposedly ran out of gas and there long, long lines waiting at every station to pump gas .
Thanks for the thoughtful article, Scott. I think it’s important to understand the complexity of these issues and recognize that ordinary citizens will suffer the combined forces of climate change and peak oil. If only US and Canadian governments would commit to creating green jobs and assiting the transition to a life after cheap and abundant oil.
Perhaps instead of pointing the finger of blame at the big oil executives we may truly need to point the finger in the other directiion, at ourselves, and say what can I do to make a difference and change this situation? It is so easy to take on the victim mentality, rather than the proactive stance of what can I do to make a difference?
If anyone is still there I will give you my take on it.
1. We have had for years a love affair with the big gas guzzlers, SUVs,vans, pick-up trucks, station wagons,and 6-8 cylinder cars, etc. that not only over time has increased our demand for oil but spewed polluntants out into the atmosphere at phenomenal rates.
2. The sleeping giant Communist China has increased its demands for oil probably ten fold in the last fifteen years with its advent of becoming an industrialized country. And who buys most of its goods that are produced? Americans do. Put aside the fact that there are few rigid standards of quality control that are adhered to in that country, that is evidenced in the contaminated toys, pet food, and myriad other products that come into our country that we have yet to discover may be tainted. In the mean time we are making them the richest country in the world, closing down our own factories, companies, plants laying off thousands upon thousands of workers, to go for the cheaper and perhaps more dangerous products of China.
All the while China is using in some areas slave labor, contaminating the atmosphere with their pollutants and by-products of industrialization,(causing an ever steady and acclerated rate of global warming)and in some cases sending inferior and contaminated products to the world.
3. We have increased our technology by leaps and bounds. But in the process we have to some extent sold our blue collar workers down the river. We slowly and gradually are decreasing our buying of American goods and increasing our buying and dependence on other countries for our products. From cars, to clothes, to cosmetics, ad infinitum and the list increases daily.
4. It is always easier on the conscience to have someone else to blame, our finger just seems to go in that direction especially when it comes to oil. Yes, the retired oil executives have gotten astonomical pensions, and I too beleive that is obscene.
Yet perhaps what is more obscene is the fact that we as Americans have allowed it to come so far in our demand for oil, that it has now come to this critical stage economically, of do something or stand to lose everying. Status in the world, independence, democracy, peace all truly are hanging in the balance at this time in our truly so short, but mighty history.
5.We are not victims. We do have a choice here. America has the largest source of untapped oil reserves in the world. Do I need to repeat that? With the oil we have the world could be dependent on us, instead of us dependent on a small handful of nations for our economic existence.
6.We have a huge reserve of oil off the coast of Florida, that is already in the works of being tapped into by Cuba because we have done nothing to claim it. We have oil off our shores of California, that were drilling in the 70’s and 80’s. And of course there is Anwar in Alaska. It could produce about 30 billion gallons of oil, probably enough to last for at least ten years.
There are also vast untapped areas throughout the West, that could sustain us for 100 years or more. Certainly long enough to establish a suitable substitute for fossil fuel.
7. Some aruguments against drilling:
a. There could be oil spills in the oceans that would threaten our seas and the creatures that inhabit them, like the Valdez oil spill.
b. Wildlife would be threatened and one of the last remaining pristine areas of the United States, Anwar, would be violated.
c.The oil drilling structures are unsightly,an eyesore, and dangerous.
8. Some arguments for drilling:
a. The Valdez oil spill was a horrible tragedy to our oceans and wildlife, no one will deny that. And because of it our ships that would carry oil are now built stronger with double hulls, and more steel enforcement. No one can account for human error or irresponsibility, and that as we all know was why this oil spill occured in the first place. We have learned much since this horrible incidence about containment and and most importantly prevention.
b.Anwar is one of our last untouched and vast refuges for wildlife, there is no argument here. And yes there probably would be some impact on the environment but it would be temporary and not a permanent one. With the Alaskan pipeline that was worked on for years, after all settled down and studies ensued on its impact to wildlie it was found that some of the species of wildlife actually increased their numbers as the animals found warmth and food by the pipeline.
c.We could drill fifty miles offshore, which would make the structures almost invisible to the naked eye. These structures too have been vastly improved. There were many oil rigs off the coast of Louisiana when devastating Katrina hit, yet not one of them sustained any damage severe enough to cause an oil spill. That has to prove to some how far we have come since the Valdez disaster.
9. Again we Americans are not victims. We are valiants. From our inception as a nation we fought for our right to exist, our right to be a democracy of free people and our right to live in peace and harmony with one another. We also have the right to our beliefs and the right also to change those beliefs if they no longer apply to our common good, our children’s common good and the common good of all.
Those values are at stake now. Yes change is needed not as just a word, but one as a word of substance and meaining, and above all right action. We must decrease our dependence on oil, and if that means temporarily drilling in our own land, than it must be. We are Americans, we determine our future and the future of our children, we are the ones who must make the hard and difficult decisions for the good of our lives and our children’s lives. We must probe,discover,create,research,and refine and never give up until we can share with all a substitute that we have found for oil. We truly are our best and greatest hope for the future. It is all in our hands. We must keep our proud heritage of strength and courage in adversity and do what we must do to get the job done. And until we can develop that substitute we must also drill for our own oil, on our own God given land. And if we do, we will remain stronger perhaps than ever before, we will hold the pursestrings of the world, and we will continue to be our brother’s keeper and a force to protect and defend what is right and just for all people.
I wonder how long it will be before people protest the high cost of commuting by buying a more expensive home with the savings they pocket by not driving so far to work. According to http://www.CostofCommuting.com, you could buy a $110,000 more expensive home by being 5 miles from work vs. 40 miles away. That’s not even counting the environmental impact, or the amount of time wasted commuting.
DiAnna-
1. You and I live in very different worlds if you think temporarily drilling offshore will solve our addiction to oil. I’m not even really sure what the color of the sun is in that world.
2. You mis-characterize my post as “playing the victim” when all I do is state the recent facts backed up by mainstream media articles and recent publications. It’s a fact that people are losing their jobs and livelihoods because of high oil prices. It’s a fact that oil companies are making unprecedented profits as a result. It’s also a fact that a populist revolt is brewing as a result of both. Accept it or don’t accept, it’s the truth and it’s happening. The only thing I advocate for people to do is be agents of change using DIY strategies and not rely on the government or corporations to make all of our life decisions.
3. You make a lot of blanket statements, but cite no sources. Most of the statements in my post are linked to mainstream articles and publications. Maybe it’s my years of internet flame wars, but I don’t take unsubstantiated opinions very serious. Please include some in your next response.
4. Finally, as a former history teacher I find this statement very upsetting “From our inception as a nation we fought for our right to exist, our right to be a democracy of free people and our right to live in peace and harmony with one another.” Where exactly in our history have actually had a true democracy and where exactly have we existed in harmony with others? You might need a new perspective and I suggest you read Howard Zinn’s A People’s History of the United States and James Loewen’s Lies My Teacher Told Me.