While Congress does the perp walk thing with oil company executives, and while cable "news" anchors speculate in their usual factless way about the causes of high oil prices, it turns out the answer is not at all mysterious. It's not just supply & demand as Republicans want us to believe. It's not just the oil companies as Dems want us to believe. It's mainly the speculators, and both parties have their snouts in the trough.
How did these speculators get so powerful, and why is nobody willing to name them or regulate them? The answer is a law passed at the tail end of the Clinton admin, mainly pushed by Phil Gramm (to satisfy his wife's lobbying clients) and happily signed by Bill Clinton. The law removed all regulation from energy futures trading, which at first helped Enron pull its nefarious schemes, and then opened the door to the current mess.
Everybody has dirty hands, so nobody is willing to break the oath of silence. Note especially that Gramm is an advisor to Товарищ McCain, which means that Товарищ McCain is happy to wallow in filth.Here's
an excellent article about this law and its evil effects in both oil and food markets.
Michael Greenberger, former member of the Commodity Futures Trading Commission, has been publicizing the problem and the need for re-regulation. He sums it up:
"Should we have an economy that’s based on whether people make good or bad bets? Or should we have an economy where people build companies, create manufacturing, do inventions, advance the American society and make it more productive? We are rewarding people for sitting at their computers and punching in bets. That’s not the way our economy is going to be built, and India and China, with their focus on science and industry and building real businesses, are going to eat our lunch, unless the American public wakes up and puts an end to an economy that praises and makes heroes out of speculators."
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Update 5/30: Apparently some part of the gov't is actually trying to put the brakes on the speculators. They won't get far without a change in law, though. The bastards who have been destroying lives and countries to fatten their own already-bulging piles of evil gold will not stop because of a gentle verbal warning.
Labels: the broken circle