Economics


Money down the Drain

Do your pockets feel a little lighter than they used to? Perhaps about $7,000 lighter? Well don’t worry, that’s just the cost of the economic stimulus for each tax paying American! That emptiness you feel is just feeling of our economy being stimulated by Obama’s package! So now that we’re out $7,000 each the question is, will it work? Will our economy finally get the treatment it needs to get up again? Will we be driven into the cold deadly arms of Socialism? Is Obama’s $825 billion package really as big as everyone seems to think it is?

The Angry Men weigh in on the issue, and hopefully you, dear reader, will as well. We want to know, what do you think of Obama’s package?


Angry Midwesterner

Despite having voted for Obama over McCain, I have to agree with McCain on this issue, the so called “stimulus package” is mostly pork. Even the slightest bit of research shows us that only around 3% of the stimulus money will be spent in the next year, and in two years time only 16% of that money will be spent. A huge chunk of the money isn’t even marked to spent before 2011. So how exactly is this the crucial time sensitive stimulus it was sold as? How does it help America if the money isn’t even being spent? This isn’t about reviving our economy, it’s about never letting a crisis go to waste, as Rahm Emanuel has mentioned, many times.

The worst of it is, the pork isn’t even good pork. It’s mostly wasteful spending probably driven by lobbyists. If Obama really wanted to pork the US so badly, I at least wish he’d had the decency to not lie to us and claim it would stimulate our economy while the special interest groups he is beholden to got theirs too. This stimulus package is a violation of the trust America put in Obama, and is most definitely not the change we voted for.


Angry Diesel Engineer

 
I don’t see how this massive piece of legislation (almost 500 pages in the form Obama signed) is supposed to “spend us out of our recession.”  

While I completely disdain Obama’s socialist utopia (believing that I am better suited to manage my affairs than Uncle Sam), I am interested to see what happens with all this oversight that gets put in place.  If you haven’t checked it out yet, Recovery.gov is an interesting website, with lots of ambiguous statements about how our crazy reckless spending is going to help everyone keep their job.  I am disappointed that millions of dollars are going to create government bureaucratic jobs for said oversight positions though.

I am interested to see where this takes us especially with health care.  I’m not sure how making all medical records electronic will help save jobs (unless you get a job on the H.I.T. board).  All in all, I have great distrust in the government making health care decisions for me.  If they were making decisions for you over  100 years ago, your free health care would have been mandated by the gov. to let your blood.  In a field that is constantly improving in technique and knowledge, free market is the only logical way to go.


Angry Overeducated Catholic

 

I think Angry Midwesterner’s boiling it down to $7000 per taxpayer is a great way to think about this. Another is how much money is being spent per job created (about $300,000 if I recall). And a third is to note the areas most impacted by the current economic woes, the areas where the most money is going, and then notice that they don’t really line up:  

http://money.cnn.com/news/storysupplement/economy/stimulus_jobs/

At first glance, Nevada, for example, should be up in arms. In fact, that map doesn’t look at all like the map of a package intended to help out those hurt by the recession. Actually, though, the per-capita map shows you that it’s not really that bad, but it’s still somewhat disconnected from the unemployment rate.

Because, after all, it’s not really about helping those hurt by economic turmoil…it’s about buliding the Great Society v2.0 (aka New Deal v3.0).

And that $7000 price tag? Only going to go up folks, or should I say, suckers! You tax-paying, hardworking chumps whose money will be systematically confiscated and transferred to the ne’er-do-wells, luckless souls, aging Boomers, shiftless bums, and criminal classes across this great land! The Democratic leadership views you as so many stupid hick sheep to be sheared for the Greater Glory of the People’s Government. It’s just the start!

Remember: Obama is going to cure cancer…with your money, all of it if that’s what it takes.


Angry Political Optimist
 

The size of the stimulus package is not so much of an issue. At the end of World War II, the debt as a fraction of GDP approached 100%. Even if the dire predictions of the Republicans bear out, and Obama’s administration creates a $4T running deficit, a functional United States of America can recover in less than ten years. 

What should be worrying people is the implicit surrender of what makes America great that is embedded in these packages. Since when do Americans look to the government for assistance? Remember when people listed the classical set of great lies and number two on the list was “I’m from the government and I’m here to help you?” Americans need to look inwards to themselves and to each other for support, not to Obama and his minions. If we accept what Obama and the Congress tells us we are — what is implicit in this package — then we will NEVER recover as a nation.

As a practical matter, spending money requires an efficient bureaucracy, even if they only spend on themselves. Bush’s Katrina fiasco was caused not by an unwillingness to assist black residents but by the total unwieldiness of the FEMA distribution system. Wal-Mart, and for that matter, the US Military were on site and assisting within days (only to be rebuffed and hindered by FEMA). Does anyone really think that doubling down on the bureaucracy in Washington will allow them to spend the stimulus money. Do the math. You have to distribute $2.2B a day. (I realize that this is not the way it works, but really, by 2010, I bet that most of the money is still just an allocation on the liability side of the balance sheet. One that can be wiped away with a stroke of a pen in 2010 I might add.)

Obama and the Congress have shown their true colors. They make the Republican porkers look like pikers. Let them have their day in the sun, and then in two years bury the bastards for another 40.

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It was a little over a year ago I wrote about Ugo Chavez’s dramatic ability to run a fine country into the ground. Well the speculative bubble that held oil prices at record highs last year has popped and, with the global recession, oil is selling at $40/barrel, not the $80/barrel that Ugo needs to break even. (I don’t know about you but I make sure not to buy gas at Venezuelan-owned Citgo stations, to do my own nano-scale part to hasten Chavez’ demise.)

So today I wake up to snow, a cup of coffee and the Washington Post, and find this little gem by Edward Schumaker-Matos. Money quote:

Inflation in Venezuela is running at 31 percent, by far the highest in Latin America, and is expected to hit 45 percent this year. The official exchange rate is 2.15 bolivares to the dollar, but the black market is at more than 5 bolivares, a gap so large that the government will have no choice but to devalue the currency, which will cause local prices to rise still more. The government has enough reserves for the next year to continue subsidizing food prices, but that has caused food shortages. And the government is so far behind on payments to oil contractors that many have stopped working, cutting back production from the goose that lays the golden eggs. Oil accounts for 95 percent of Venezuela’s exports.

While I idly dreamed about a firing squad for Ugo, that reality may be closer than anyone thought. I doubt it, his pal Ah-ma-dinnerjacket will probably take him in, in style. Oh, wait, Ah-ma-dinnerjacket ain’t having so grand a time of it. Well there’s always, Tsar Vladimir, though he might not have too grand a time if oil stays down, either. If all else fails, they can always hot bunk on Radical Jack‘s couch….

Updates: Sigh.

And this.

Here’s a nice article on Tsar Vladimir’s current dilemmas.

Anyone reading through the list of bribes attached to the bailout bill passed last week eventually runs across this entry, and is utterly confused.

Excise Tax Exemption for Wooden Practice Arrows Used by Children. Current law imposes an excise tax of 39 cents, adjusted for inflation, on the first sale by the manufacturer, producer, or importer of any shaft of a type used to produce certain types of arrows. This proposal would exempt from the excise tax any shaft consisting of all natural wood with no laminations or artificial means to enhance the spine of the shaft used in the manufacture of an arrow that measures 5/16 of an inch or less and is unsuited for use with a bow with a peak draw weight of 30 pounds or more. The proposal is effective for shafts first sold after the date of enactment. The estimated cost of the proposal is $2 million over ten years.

I took it upon myself, being fond of archery, to look into this as a service to our loyal readers, and hopefully find something that made this make more sense.

Fortunately, there were a number of other sites more devoted to the topic, and with longer, more detailed write-ups of the issues, so here’s the summary:

In 1900, the Lacey Act helped return hunting to a for-sport hobby or for-food necessity, rather than a for-profit cash-crop mega-harvest that it had been, and the remaining hunters have had a key interest in proper wildlife management.

In 1937 the “Federal Aid in Wildlife Restoration” program (referred to as the Pittman-Robertson program) was enacted and signed by FDR. This enacted that fish and hunting license fees would be used only for wildlife management and for hunting safety and training (such as setting up state-run shooting ranges).

In 1969-1972, in quick succession, an excise tax was imposed on hunting arms and ammunition as well as hunting archery equipment. This was mostly spearheaded by a prominent archery manufacturer and conservationist, Fred Bear. The archery tax was intended to be split 50/50 between the state for wildlife preservation and archery clubs for setting up instruction and shooting facilities — to help encourage the hobby. Because of a bit of politicking, the money for the archery facilities was never released, and all of it was kept by the governmental departments.

In 1997 collection this tax was moved from being at the point of retail sale (that is, at every mom & pop archery store — which was a serious headache) to further back up the supply chain at the manufacturer. Arrows, for various reasons, have to fit the individual archer and bow, and so are best assembled and finished at the point-of-sale. This tax change encouraged the continuance of point-of-sale arrow finishing.
But this specified that the tax on arrows would be on arrow components, not on finished arrows. This opened a loophole in that imported finished arrows did not have the tax assessed on them.

From 1997-2002, domestic arrow manufacturers increasingly lost market share to importers because of the unlevel playing field. ($.43M, $1.6M, $3.2M, $7.8M, $11.0M)

In 2003 the loophole was closed by taxing the first-sale of completed arrows regardless of where they are manufactured.

This eventually resulted in a $.43 tax per arrow. (Real arrows tend to cost between $5 and $10, so $.43 isn’t a huge deal.)

However, children’s practice arrows can be very cheap, even into the $.36/arrow range. This means the excise tax for these arrows is 120%! This priced archery as an activity out of the range of most youth programs when the price for the core expendable more than doubled.

Starting in 2005, a wooden arrow manufacturer in Oregon (Rose City Archery), whose business orders from youth programs had died off 40% that year, began lobbying for an exception to this tax for youth arrows. (Note: I’m not entirely sure where Rose City was getting their numbers (quoted from the link above) from here, since even their cheapest kids’ wooden arrows are $39/dozen = $3.25 per arrow ($2 per arrow for do-it-yourself), of which tax would be around 13%, still not ridiculous)

In 2008, this bill that didn’t have the weight behind it to get passed on its own, and it just sat around waiting for the right spending free-for-all to get attached to before it could pass. And now, voila! Youth archery is blooming abundantly this week and upwards of four (yep, just 4) U.S. manufacturers of wooden arrows are back in the cheap wooden arrow business! The economy is saved!

Verdict:
Overall, I didn’t know that hunting licenses and taxes paid for so much of the state fish & wildlife budgets. This seems proper that people benefiting should pay most of the cost.

I began thinking that the wooden arrow thing actually made -more- sense because it was correcting a fault in the tax code, and the new version would encourage youth archery, and lead to more adult archery, resulting in higher tax revenue amounts (not least of all because adult archery equipment is expensive). However, aluminum arrows were invented in 1939, and carbon arrows invented in 1983, wooden arrows are only used by “purists” and historical reenacters. Most real youth archery programs use aluminum or carbon arrows, and aren’t affected by this change.

I conclude that this is just another piece of pork for congresscritters from woody states, and won’t really have any affect at all on archery in America, except to draw a bit of attention to it from all the chatter about how ridiculous this tax exception is, especially compared to the actual matter at hand that it was tacked onto.

-AI

Chemotherapy is a process I term ‘differential death’. Powerful poisons are administered to the body in hope that cancer cells are killed off either preferentially or at a higher rate than healthy body cells, albeit with the understanding that a certain amount of healthy cells will die during the process. Chemotherapy works only when there exists some finite difference between the growth of the cancer and growth of healthy cells that can be exploited.

In the following arguments, I assert some premises which I believe are supported by observation. One of these premises is that the Government of the United States includes some people who are very intelligent and very clever, despite the obvious inanity of the politicians. Pare away the first layer of politicians, the Congress, the executive branch, and their support ,and there are groups of people who have a very detailed and complete understanding of the various processes occurring in the world. There are also ‘think tanks’ whose stock in trade are ideas, plans and processes, most of which are vetted very thoroughly.


In the recent economic turmoil, the Federal Open Market Committee (The ‘Fed’) made certain statements, raised interest rates multiple times, and even manipulated the acquisition of Bear Sterns. It opened its discount window, once only available to regulated entities such as banks, to unregulated financial firms. While this was hailed as good in the first few instances, as the rates were lowered again and again, voices began to be heard suggesting that the Fed’s monetary policy was in error. In the aftermath of Bear Sterns, more and more editorials in the Wall Street Journal began to address the ‘moral hazard’ of making such liquidity available; the ‘moral hazard’ of Congresional action on bailouts of mortgage companies who made questionable loans; and the decline of the dollar worldwide. Since food commodities and oil are predominately denominated in dollars, the result of the weak dollar has been a run up of commodity prices. The restrictions on investment resulting from the ‘mortgage crises’ generated large amounts of liquidity that would have gone into SIVs and CMOs, but instead went into commodity speculation, exacerbating already high commodity prices.

Yet the ‘Fed’ does nothing. The White House talks about the global significance of a ‘strong dollar’ yet does nothing. The Treasury Secretary makes strong dollar statements one day and recants them the next. What is going on here? These are, in fact, some of the previously mentioned intelligent and clever people. If the news commentators, abjuring their fascination with Amy Winehouse, or other pop-tart-du-jour, can see and comment on the effects of a weak dollar, then it should be blindingly obvious to even politicians.

These events did not occur in a global vacuum. Let’s look at a few of the boundary conditions. China is a developing economy whose growth is poised at double digits. China’s labor markets provide US companies with a means of inexpensive labor for manufacturing. As a result, China sells an enormous amount of goods to the US. While China’s trade balance sheet is balanced insofar as imports and exports, the balance in trade with the US greatly favors exports. Further China is “The Middle Kingdom”, whose negotiation policy is “You give me this, and I’ll take that”. Repatriating profits from a business venture in China is tantamount to impossible. The only way to successfully do so is to create a Chinese corporation with a Chinese national, route the profits to this new corporation and purchase something from a party in which you, the original company, have an interest. Chinese economic development officials are literally dumbfounded at the concept that you, as a businessman, would not want to leave your money in China. China is about dominance and about regaining their (largely hypothetical) position as the Middle Kingdom: the number one military, industrial and political entity of the world.

The US buys goods from China. In return, China obtains a large amount of US currency. Money which is stationary is useless, so China uses this source of funds to invest in various opportunities including those in the US, buying US Treasuries. China also invests in other financial instruments which are dollar denominated. China is also gowing, and uses a significant amount of energy resources. This creates a huge demand for oil and other ‘portable’ sources of energy. Finally, China has a political system which favors central control which makes its responses a tad arthritic.


Economic inequity has been a casus beli for as long as man has existed. So if one were to fight a war with a major power, how would one go about it? Iraq is not a major power. Success in the war in Iraq under whatever one wants to characterize as success, can be obtained through force of arms. Similar arguments can be forwarded for most of the medium sized countries, but the real question is how does one wage war on a China, or a Russia. Even smaller countries such as Venezuela and Iran, due to their economic coupling, cannot be warred upon by force of arms. This is especially true for those countries with their own capable militaries and those with strategic nuclear weapons.

To successfully challenge China, Russia, Iran or Venezuela, they must remain unaware that the war is even being fought.

The United States is by far the most dynamic economy of the world. In its normal course of business, hundreds of companies are created and destroyed each year, with novel companies rising to the top of the capitalization structure in fields which didn’t exist even as much as five years ago. Companies providing basic commodities adapt or are driven under by the competition. A 20% bear market drop in the Dow represents the GDP of almost half of the rest of the world. The markets have legacy sayings — Wall Street sneezes and the rest of the world gets the flu.

So if, by analogy we view the United States as the body and the influence of China as malignant cells, how can we wage war to eliminate this influence. Strangely enough, depressing the value of the dollar is one very astute way. The results of this particular brand of chemotherapy is already showing results. Yes, it’s painful, and yes we are losing our hair, but as a result of the rise in commodity prices, business in China is becoming unprofitable. Even Wall-Mart is reconsidering its manufacturing operations there. Manufacturers, faced with shipping costs that are three to four times the production cost in China, have to sell at markups to cover these costs. It becomes cheaper to manufacturer the products here in the United States. Factories which were moth-balled are being re-opened. It is estimated that the current shipping and energy costs amount to an 9% tarrif on Chinese goods.

The rise of dollar denominated oil has forced China to finally raise its subsidized fuel price to its population by 18%. This has an immediate adverse effect on economic growth which is propelled by both energy and capital. And the Chinese citizens who worked their way to the middle class only to find their manufacturing jobs eliminated, become a burden and place demands for a support net on the government. More money flows into social security and less into the military. And the present value of the investments China has placed in US Treasuries and financial institutions is dwindling. The capital investments they do have are decreasing in value both due to inflation and exchange rates. China has recently allows its currency to increase with respect to the dollar in response to this. This only further makes its products less competitive. So as long as the US can withstand the pain of the chemotherapy, China’s influence will lessen.

While the main force of this attack I believe is China, a more subtle attack is being waged on Saudi Arabia and Russia. This attack consists of inflating the incomes of these countries beyond their ability to control. Saudi institutions like KAUST reflect the belief that money can buy prominence in research and technology, as well as stability and respect. Enormous sums are being spent in developing universities with the belief that a religiously restrictive and closed society can become host to a modern research institution. What both Saudi Arabia and Russia don’t understand is that the wealth and power of the United States is not in its things but in its attitudes, freedoms and optimism. When the price of oil falls, as it must, programs in these countries dependent on this cash flow will cease to function. Chavez in Venezuela is spending his oil revenue on vote buying social programs and doing little to build his country’s infrastructure. When the revenue is no longer there to support the programs, they too will cause more problems for Chavez than the United States ever did.

So as long as we can take the pain and adjust a little, we can limit the influence of the cancer. After all, hair can grow back. America needs to see to the aspects of our society that allow this to work — that is creativity, flexibility, inexhaustible energy and freedom.

Pity poor George W. Bush. Already under fire from some quarters for his decision to attend the Olympic Games in Beijing, he drew more fire for keeping his harshest words for China out of his speeches in Beijing, and more fire still for being in Beijing and “out of the loop” for the sudden Russian invasion of Georgia. For many, just more proof that W is a bumbling fool.

But in reference to both China and Russia, it’s really Bush’s foes who are foolish, and W who really understands what is needed. Whether we like it or not, the world is currently geopolitically divided into four power blocks: the United States, Russia, China, and everyone else. The European Union and Japan can compete economically (though each is less of a competitor than either seems to realize) but lack any credible military power projection. The rest of the world may have armies, but has neither the economic might nor the infrastructure to really project them. Like it or hate it, at the present time the US really only has two rivals for hegemony: Russia and China.

And since 1972, the United States has conducted a long, slow, steady dance which has slowly but steadily transformed the People’s Republic of China from an insular, xenophobic rival into an engaged, cosmopolitan economic partner. The PRC remains an autocratic state run by a cabal which can be brutal but which, increasingly, hides its iron fist in a velvet glove. Most importantly, the PRC’s leadership has adopted a nearly explicit bargain with its people: in return for your obedience we will deliver you prosperity. This means that the PRC has little choice but to grant a growing class of wealthy capitalists and prosperous businessmen increasing freedom of action. While these classes may be largely apolitical, they will make increasing demands for their own personal, economic, and social freedom. And the Chinese will have to either deliver or watch the prosperity they need vanish.

Sadly, since 1992, Russia has taken an opposite course: clawing its way out of Communist tyranny only to fall into the worst excesses of kleptocracy and crony capitalism. As China has been building economic freedom, Russia has been reducing it—limiting wealth and influence to a tiny class of criminal overlords and political cronies. And while the Chinese leaders increasingly choose to conceal their true power, Vladimir Putin has been steadily accumulating the trappings and practice of the Czars of old. And now, at long last, he has taken up the favorite Czarist pastime: gobbling up vulnerable neighbors on the most transparent of pretenses.

Unfortunately, much as we might like to, we simply can’t afford to meet such Russian aggression openly on the battlefield. Any large direct confrontation between American and Russian forces must result in either many, many Russian soldiers killed by American weapons or vice-versa. And that means that in any such confrontation, the specter of nuclear retaliation cannot be avoided. No matter how unlikely, the very thought of nuclear escalation must give us pause, especially against someone with Putin’s sociopathic patterns. Yet we cannot allow Russia to simply crush sovereign nations without limit or reprisal.

So the Administration’s strategy of avoiding rattling the saber in favor of threatening credible economic and political reprisals makes sense. As does the Administration’s willingness to allow the Russians to save face after what was, after all, a profoundly stupid move by the Georgians. And a move done in clear opposition to the consistent advice and counsel of the United States. No matter what provocations Russia engaged in—and the evidence is building that they all but directed separatist attacks—Georgia’s overwhelming military response targeting Russian “peacekeepers” directly was the worst possible response. And one which greatly limited American ability to back the Georgians.

But, as long as Russian aggression can be contained by a strong and unified stance by the US and its allies, then in the long run, Russia is the less important concern. Drunk with oil profits, and headed by a burgeoning Napolean, Russia is an important short-term threat. But it is also an aging nation with a declining population, crumbling infrastructure, and rampant corruption. In the long run, it is energetic China, with its huge population, exploding economy, and tremendous optimism which will be the great rival or the great partner of the United States. Bush can’t afford to ignore or underestimate Russia, but he knows that China deserves the greater attention.

The greater attention, and the greater respect. China remains a nation with oppressive laws, cavalier treatment of certain basic human rights, and problematic limits to the rule of law with respect to senior government and military officials. But it has also made almost unbelievable strides in a very short time. Beijing in 1988 was not a place many Westerners, much less many businessmen, would have chosen to live in. Beijing in 1998 had seen vast improvement, but still had much to do. The Beijing of 2008 has become a vibrant place of commerce, prosperity, and genuine cosmopolitan life. The limits on personal freedom remain, but have become largely unimportant for daily life: more Singapore than Communist China. Serious problems remain, but the urban centers of China of today are far more similar to those of Korea or Japan than most would have predicted even a decade ago.

So W was right when he expressed his strategy to Bob Costas in a brief, but frank interview. To influence China we must remain engaged with China. And to remain engaged with China, we must show clearly that we respect China and her recent accomplishments. To be sure, we must continue to use that relationship to urge reform and liberty, but we don’t have to slap the Chinese in the face during their big moment. Instead, we can do exactly what W did: call clear attention to the problems but keep the greater focus on the positive changes in China and the decades-old Sino-American relationship that has helped to produce them.

Cars are manly. That is, they used to be. Some of them still are. Minivans never were. Because men stopped doing manly things like strip mining, offshore drilling, and refinery construction, gas is expensive. Because gas is expensive, cars are becoming girly and nancy-boys with girly cars (Prius, Smart Car, anything hybrid, and anything that has to slow down to go over a speed bump) are clogging to road. People out here are starting to claim that hybrid drivers should get to park in handicapped spaces. I readily concur that any many driving a hybrid qualifies as being handicapped.

Suffering through the high energy costs brought about by unmanliness does raise a quandry for real men — how to not pay your beer money to the gas man (or worse, to tax-lustful politicians). Especially when buying a new car (for when the Lotus is back in the garage for the winter) this is a question that will weigh on the mind (a space that should only be full of its rightful contents — sports, explosions, etc.)

The two least manly results of car buying are 1) to by an unmanly car (see aforementioned list) and 2) to get ripped off by paying too much for -any- car. The big selling push lately has been towards hybrid cars for their vaunted mpg ratings. As we’ve covered here before with proper hard numbers analysis, the overall money-in-your-pocket savings is questionable, since putting two engines in a car is costly (and heavy). Plus, you get the added shame of ending up with a hybrid.

In what seems friggin’ obvious, but ends up being pretty useful (as all true manly innovations are), a dude recently started making noise about it being easier to tell how much cash you’re saving by looking at your car’s gallons-per-mile rating instead of the mpg. Figure out how many gallons it takes to drive 1 mile (or 100, or 1000). You’ll start seeing the real difference, instead of the crap that the weasley car dealer is trying to push on you.

“The reality that few people appreciate is that improving fuel efficiency from 10 to 20 mpg is actually a more significant savings than improving from 25 to 50 mpg for the same distance of driving,” Larrick said. (See table below.)

(ScienceDaily)

Miles Per Gallon Gallons Consumed per 100 Miles Driven Gallons Consumed per 10,000 Miles Driven
10 10.00 1,000
15 6.67 667
20 5.00 500
25 4.00 400
30 3.33 333
35 2.86 286
40 2.50 250
45 2.22 222
50 2.00 200

(table also from ScienceDaily)

Since real men aren’t afraid of math (as evidence, see any post on this blog, cause math is friggin’ manly), this is just a chart of a function that is O(1/x). The same delta to x at a lower range of x values will have a greater effect than that delta at a higher range of x values. It’s a case of diminishing returns. Save the money you would spend on a hybrid car and spend it on a car with decent mileage, and comfort for you and your crew. The extra mileage increase from 30-35 mpg just isn’t going to pay you back.

Naturally, this is as naturally obvious to any real man as throwing a spiral or grilling steaks. But as a public service to any real men who may have been too distracted by the overall girliness of the world lately to allow his manly intelligence to reach this conclusion, I thought it bore repeating. (hat tip Darren at RightOnTheLeftCoast.)

I included a graph to help you explain this to people who struggle with numbers if there aren’t enough pictures (eco-women, unmanly men, congresscritters, etc).

Don’t be taken in and buy a hybrid. It bears repeating. Real men only need one engine, unless they’re driving the space shuttle. The only acceptable hybrid is a steak/bacon hybrid. That cannot be stated too often. Steakcon.

As gas prices hover somewhere between $3.65 and $4.50 (depending upon where you are and what you buy), and all manner of schemes, plans, and programs are discussed for reacting to that, there’s a simple question:

To Drill or Not to Drill?
 

There’s no question that America has substantial untapped oil reserves: in Alaska, off the shore, under the Great Plains. And new technologies may make recovering even more of this affordable, even at sub-$100/barrel prices. At $125/barrel and above, we’ve definitely got more oil we could be extracting.

But of course, that comes with a price: damage to the environment and treating the symptoms without addressing the disease. Like a junkie facing withdrawal who simply scores more of his chosen poison, we’d simply be feeding our addition, not dealing with it.

So, to drill or not to drill? That’s the question for you all.

Oh, that and the obvious follow-up: whether we drill or not, what else do we do? If you’re pro-drilling, you’ve still got to face that we’re just delaying things. If you’re anti-drilling, you’ve still got to face that spiraling fuel prices lead to poverty and even death for real live people.

So, either way, what do we do after deciding to drill, or not to drill?

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