Prices going DOWN, incomes stay the same.

Date:   10/16/2008 12:13:44 PM ( 16 y ago)

Prices going DOWN, but incomes stay the same - sound good?

The "credit crisis" has stimulated some hard thinking about out economy. Is it sustainable to allways need to have GROWTH in order to keep things running smoothly? It should have been apparent that house prices could not continue to rise forever, at least not without a lot of inflation or a devalued currency. Sure enough, when house prices started falling, there was a huge problem.

And now, considering the climate change problem, we have to find different ways to provide energy.

So how about a goal of helping average people by finding ways for things to COST LESS?

LESS? There is a psychological hurdle there - we tend to think of "down" and "less" as being bad things, but if it is the price of groceries, then it is a good thing. Or the price of gasoline... which is dropping right now [Oct 16th, 2008].

How would this happen? I suggest doing the reverse of what has been making prices go up so much in recent years - the cost of energy has been rising, so we find ways to make it go down. Also, there is a big benefit to lower house prices for lower income earners... maybe everyone can afford a house now!!

The economic downturn has reduced the demand for oil and gasoline, and so the price of a barrel has been dropping. Use less oil, and the price goes down, but REPLACE a lot of oil with another source of energy and the price will go down even more!!

How could we replace oil? With WHAT? - by electricfying our transportation system, and by using electricity in more and more places where we use oil or natural gas now.

Of course, this new electricity has to be cheaper, and it can be. I have shown before how renewable energy works out to be cheaper in the long run as compared to coal, and now I want to show how it can be cheaper immediately.

Cheaper than coal:
Creating electricity with coal, for example, requires a constant supply of coal to be used, and that coal has to be bought and paid for, plus there has to be workers to move it into the burners; it also is dirty and shutdowns for cleaning need to be done every year. There is also the global warming factor, but this is about the cost, and putting artificial "carbon taxes" on pollution won't lower prices at all, so I am putting that issue aside.

Setting up several windmills [a "wind farm"] to produce as much electricity as a coal burning electricity producing facility works out cheaper in the long run because there is no continuous costs, and after the initial setup is paid off, the wind farm produces electricity for years and years for FREE. Coal-fired burners need continuously added coal.

The immediate cost of setting up wind farms is something that can, and should, be covered by government, as a way to bail out the economy right now. Everything would be cheaper is electricity were cheaper. Imagine how many windfarms could be set up for $750 Billion!! And just like the credit-crisis bailout, that money WILL ALL BE PAID BACK over time as the wind farms continue to produce energy for people, even at a lower rate than we pay now, and from that money the government will get paid back, they will get every cent back. All they are doing is averaging the costs out over time, because time is the big advantage of renewable energy sources.

Capitalist economics demands profits within just a few years, or they don't build it. That creates a short-sighted and narrow range of possibilities... but allowing government to get involved [and they are now, as owners of banks], we can spread the costs, and profits, out over 15 years instead of 3, we will benefit right now with reduced demand on oil, and our children will reap the rewards in a very clean, better, CHEAPER world. 15 years isn't very long, really. Restricting investments to a 3 yr. outlook is sillyness.


Electric Cars:
As for the idea of electricfying transportation, that means electric cars. Many people believe that electric cars have been kept off the roads on purpose because the oil interests, and the big carmakers [GM, FORD, TOYOTA] make more money from the kind of cars we have now - "internal combustion endgines". Electric cars have almost no need for MAINTENANCE, and so the GM "Mr. Goodwrench" program, the parts and repairs business, will not be needed.

Mostly it is the cost of the energy to power the cars that will cost less for consumers. It can be for free is we have solar panels on our garages to re-charge the batteries for tomorrows commute [a 2nd set of batteries hold the energy until you get back home at night, and then you simply plug into that].

Some drivers need more power, or a longer range than electric cars are capable of, and for those there are answers too - even just using the much cheaper [because of lower demand] gasoline.

Most communters, driving to work or to soccer games with junior, will be perfectly happy with their electric cars. Quiet, not stinky, no carbon monoxide, and CHEAP. Perhaps ZERO cost to drive them.

The prices to purchase electric cars will be LESS than today's cars too. Electric cars have only 100 moving parts compared to the 50,000 or so on regular cars. The engines are easy to make, there is no gas tank, we don't need to add or change oil. Once we start to mass-produce electric cars, the prices will drop to less than half of the internal combustion car costs now.

And so prices go down. We earn the same amount, but spend less. House prices drop to where everyone can afford one ; oil demand drops and then the price drop - plus we won't need foreign oil OR have to pay the HUGE costs of fighting wars to secure that foreign oil ; food prices drop as the growing and transportation of them costs less; production of all goods goes down as energy costs drop.

It will be a better world economically, and environmentally - reduced emissions of the toxic pollution [cancer, asthma, heart disease] and reductions in greenhouse gasses that are causing global warming.



 

Popularity:   message viewed 2388 times
URL:   http://www.curezone.org/blogs/fm.asp?i=1278368

<< Return to the standard message view