Everyone knows that individuals are supposed to diversify their financial investments and spread their money across multiple types of investments from stocks to bonds to real estate, etc.
So why is it that as a country we don’t seem to grasp this?
Why do we put all of our economic eggs into the oil basket, cross our fingers, hope for the best and then act like a bunch of dumbfounded idiots when, once again, rising oil prices threaten the U.S. economy?
Yes, you get the occasional acknowledgement on the part of American politicians that we need to diversify the way we “motor” our economy — although too often this isn’t so much a call for diversification as it is for “drill, baby drill.”
High fuel prices drag down economy
However what you see much more of is media coverage like the Associated Press story focusing on how higher gasoline prices are threatening to bring economic growth in the U.S. to a crawl.
A couple of excerpts from the story, written by AP reporter Christopher S. Rugaber. First, the lead:
“A renewed rise in layoffs is the latest sign that higher fuel prices may be slowing the economy.”
Further on down:
“Consumers are spending more to fill their tanks, leaving them with less to spend elsewhere. As a result, many companies are feeling less certain about the economy’s health and could delay hiring plans”.
Defying common sense
All of this because Americans, and, frankly, much of the rest of the world — although the U.S. is clearly the world’s worst oil addict — refuse to live by our own common sense maxim: It’s better to build a portfolio based on a maxim of diversity rather than to pour all of your money/effort/resources into a single type of investment.
You wouldn’t advise a friend to put all of his or her money in a single resource or to build a life that relied nearly 100 percent on that investment. Yet, here we are running our entire society based on what amounts to bad advice we wouldn’t give a friend.
We’re not talking about an individual’s portfolio here, but, of course, society’s portfolio, as in society’s energy portfolio.
The more singular that portfolio is – and it is pretty damn singular, at least in the U.S., a country in which transportation is more than 90% dependent on oil and a country in which transportation of goods (including the most important of these, food) accounts for 70% of our massive, and globally disproportionate, oil consumption – the more vulnerable you are to any change in the state of your one-dimensional portfolio investment.
You wouldn’t advise a friend to put all of his or her money in a single resource or to build a life that relied nearly 100 percent on that investment.
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Bad advice for a ‘friend’
Yet, here we are running our entire society based on what amounts to bad advice we wouldn’t give a friend.
It doesn’t have to be like this. We could diversify our energy portfolio and create an economy, and society, that doesn’t grind to a halt every single time our “global oil basket” springs a leak, or two, or more.
It’s truly flabbergasting that we refuse to see the truth behind this perspective, and, frankly, just completely mindless that we seem so deathly afraid of this truth that our mainstream media can’t even manage to acknowledge the danger of our singular addiction to oil – and the many obvious ways to address it, including a move to electric vehicles — in any meaningful way.
- America’s addiction to oil is un-American
- Say no to high gas prices — fuel an EV with solar
- Gasoline car’s tailpipe extends all the way to the coal plant
- ‘EV Nut’ sticks it to Big Oil, fills up with sun