The Peak Oil Crisis: Government in the Transition

Nearly every day brings news of trillion-dollar government interventions in the world’s economies.

With the power of deficit financing and the printing press, Washington is clearly leading the pack. Using the credit accumulated over many decades as the world’s largest economy and issuer of the world’s reserve currency, the U.S. is on track to borrow several trillion dollars over the course of a year or two that will be spent attempting to reverse the recession and credit freeze.


How well these multi-trillion efforts will succeed is still very much up in the air. The administration, which must of, course, be seen as optimistic, is predicting some sort of an economic revival next year. Others are not so sure. They believe the massive borrowing at home and abroad at close to zero interest rates will be coming to an end soon as lenders simply run out of funds and the willingness to invest in U.S. government securities. Rates will rise, the government will resort to printing money, and a whole new set of still more serious economic problems will occur. Current policies will come to an end soon for they are simply unsustainable.

In America, government is not just Washington. We have 50 state governments and thousands of local ones that provide most of the services that hold our civilization together – water, sewers, sanitation, schools, roads, police, fire, courts, welfare, and prisons. Now these governments have another set of problems. They can’t print money, most are already indebted to the hilt, and many are under legal restrictions to balance their budgets. In recent decades, the prevailing political in America sentiment has become one of opposition to taxes. Without much thought being devoted to just what goods, services and edifices might be bought with the tax money, a substantial portion of the body politic is convinced that nearly all government is a waste of money and that the less taxes, the better off we will all be.

This of course is what comes from nearly 70 years of good economic times. There are few left to remember the bad years of the 1930’s when life, even in America, was a struggle for survival and not just deciding what to buy today.

Falls Church News-Press