What do *you* think landed us in this mess?

[beccalou79]

I'm in a pondering mood today, and what I've mainly been pondering is the economy. I told my husband that this whole mess seems to have started with the housing market collapse. But then there's the wheat/rice shortage, and rising gas prices...

Are any of these things connected? Or did they all happen independently, and then combine to throw us in a recession? I guess I'm just wondering how the house of cards collapsed, so to speak...

[maplesugar]

In a word (or two): George Bush

[kmeyrick]

Lots of reasons. Dishonest banking practices. See my thread, because at least there's hope for cracking down on credit card companies.

[diamond lil]

I think this whole crisis started when we decided that it would be a good idea to grow our fuel in the form of ethenol from corn. This led to outrageous speculation, which led to problems with our economy. Now we can't grow enough food to feed ourselves and we need to import food. At unreal prices. Other countries that depend on us for food aid are suffering. All because we want to run ethenol fuel, which is not supposed to be that great for the environment anyway.

I don't think it boils down to one specific thing, but I think the whole grow-corn-for-fuel is a fiasco.

[zersha]

Originally Posted by maplesugar

In a word (or two): George Bush

:

[Lisa85]

1.) War that was unwarranted and has no definite end or attainable goal- we will never end terrorism, so a war on terrorism is unrealistic.

2.) Alternative fuel sources - I agree we need to do something with renewable energy. But it doesn't need to be done right.this.very.second. It should have been done at much slower pace. People think this is going to be an overnight thing, and it won't.

3.) Housing crisis - the straw that broke a lot of people's backs

4.) Rising food costs - this in part comes from rising gas prices, which is a result of the war. Icing on the cake - when you lose your house and then think it can't get any worse, it does because you're now struggling to feed your family.

[SleeplessMommy]

In a single letter: W

Alternative fuel is a bad idea - after years of paying farmers not to farm, combined with business tax breaks for extra large vehicles (Hummer qualifies) and wimpy clean air standards.

In short, enough consumption. 99-cent a gallon gas was not sustainable. McMansions in the outer suburbs are not sustainable. Spend the billions on public transportation and you won't need to make ethanol. (duh!)

[p1gg1e]

We have been working on this for the last 30+ years...really I think this is meant to happen and wanted from the people in power...they are making money still and our taxes are being used to pay off their messes and contracts for their friends. War and Economic issues are key things that fuel the pockets of the higher ups in the government.

I cant IMO blame just W...I think they are all the same.

[EFmom]

I think we (the collective we) are responsible for the energy situation. I'm old enough that I remember the energy crisis of the 1970s. Under Carter, the country was investing some money in research into alternative energy, and there were tax incentives for conservation. But people hated Carter because he wasn't a "feel good" kinda guy. Reagan came in and that was the end of any kind of investment for the long term good of the country.

We don't want to sacrifice. We don't want to conserve. We want to do exactly what we want to do, and we certainly can't change our lifestyle an iota for the common good. We want to drive our SUVs, run our air conditioners, have more than two kids and manicure our yards. We want it all to be cheap and easy for us.

We don't elect people who give us hard truths. We elect people who promise us tax cuts, however fiscally irresponsible that is for the country. We don't elect people who will direct federal money into alternative energy research, we elect people who are oil barrons themselves, and we let them set energy policy in secret.

Ethanol as a fuel is a good idea. Ethanol from corn is idiotic. I had a summer internship working on ethanol from biomass in the late 70s, and people knew the corn thing was stupid back then.

Unfortunately for us, oil is a finite resource, and is subject to political and economic forces that we cannot always control. Energy is never going to be as cheap again.

[leafylady]

How about a refusal, or an unwillingness, to change?
We've known that it would be wise to invest in non-fossil fuel sources for many years, yet our country chooses to not to do so.
Yes, it's definitely a choice of the government, but also of the people who don't demand it or don't make the choices (that they can do financially) in their own lifestyles.

[Knittin' in the Shade]

Originally Posted by EFmom

We don't want to sacrifice. We don't want to conserve. We want to do exactly what we want to do, and we certainly can't change our lifestyle an iota for the common good. We want to drive our SUVs, run our air conditioners, have more than two kids and manicure our yards. We want it all to be cheap and easy for us.

you had me, right up until you said the bit about more than two kids. :

[Llyra]

Building an entire society on the availability of cheap oil, and conveniently ignoring the fact that cheap oil is a finite resource. Industrial-scale food production (also dependent on cheap oil.) Letting jackasses like George Bush run the country. Being asleep at the wheel of democracy while increasingly mass media and multinational corporations began to control our lives. Refusing to recognize that our so-called economy, and our patterns of consumption, are a house of cards that cannot stand if we keep building it higher and higher.

In short, I blame all of us.

[rainbowmoon]

greed.

[CarrieMF]

Originally Posted by rainbowmoon

greed.

I think that sums it up, along with politics. The US didn't do itself any favours when the gov't alientated allied countries after 9/11, it is too dependant on other countries to supply basic needs.

4.) Rising food costs - this in part comes from rising gas prices, which is a result of the war. Icing on the cake - when you lose your house and then think it can't get any worse, it does because you're now struggling to feed your family.

It also come from the alternative fuel sources. That is what is rising the food prices.

[b&c'smama]

LOVE this thread! Very interesting (and scary). It gives me a lot to think about!

[organicmommy]

Well I agree with a lot that has been said here but I do have to say one thing.

Living in a state that corn and ethonal are huge things for us I don't 100% agree that this is all of the problem.
This state has had ethonal as part of its fuel for many many years, it is actually cheaper for us to use the ethonal fuel than it is to use regular unleaded. It is also to thank for the fact that our state is not hurting nearly as badly as many other states. We have many farmers that are thriving because of it.

Now to top it off, I think that we as a whole could do so much to help ourselves if we only chose to do so. There is no reason that we need to be so dependant upon other countries for food and other resources, there was a time when it wasn't that way and we could really benefit from returning to that way of living.

As a whole I think that "keeping up with the Jones" is hugely to blame.

[Free Thinker]

Unsecured debt... Mainly vehicles and credit cards, plus inflated property prices.

[sunflwrmoonbeam]

I think it's largely keeping up with the Joneses. So many people realize just how bad this is, yet they don't do anything. Anecdote time: I have a friend who is looking to move to one of three places: a small, rather sustainable city (where I live); the north burbs of Chicago, or Denver. Now, I know relatively little about Denver, but I KNOW that the north burbs are totally unsustainable. Yet she's still considering them despite complaining to me about how much driving they have to do, how much they spend on gas, and how expensive food has become in the past few weeks.

If people started making more of an effort to conserve, we'd all be a lot better off.

[EFmom]

Originally Posted by organicmommy

This state has had ethonal as part of its fuel for many many years, it is actually cheaper for us to use the ethonal fuel than it is to use regular unleaded. It is also to thank for the fact that our state is not hurting nearly as badly as many other states. We have many farmers that are thriving because of it.

The farmers that are largely benefitting from ethanol are of the agribusiness variety, and they are being hugely subsidized by the government. While that might be good for the owners of the agribusiness, it is not good energy policy for the country as a whole.

[Fujiko]

GAH this whole post has just turned into Economics 101. Oh well, I'm not erasing it!

Without reading any of the previous replies, this is what I think:
1. After WWII, prosperty came about and households had more spending money. Simultaneously, Big businesses, with the help of psychology, crafted manipulative advertisements to sell more product. (I think they get more manipulative every year.)Which led to...
2. People bought "extras", and in the six decades since, we've gotten used to having "extras" (fancy purses, extra TV's, etc) (Not to say that these are evil, or that I don't partake as well, just sayin'.) Which led to...
3. Shopping became the New American Pastime. When my DH and I are bored at home, we go to the mall (even if we don't buy anything 90% of the time.) Extras are now almost as important to Americans as having the necessities, because of wanting to fit in, and because of a sense of entitlement. Which led to...
4. "Keeping up with the Jones'". Which led to...
5. People became willing to go into debt (use credit) to fund "extras" they couldn't afford. (Personal Finance, at least where I'm from, is not taught in schools and many parents aren't a good example of how to handle money. So lots of people are simply ignorant when it comes to money and credit.) Which led to...
6. Credit companies realized how loose people had become with their money, and realized they could make like a gazillion dollars off of them. So they a.) opened a boatload of new credit accounts for boatloads of consumers, and b.) through advertising, they made having credit cards (and the debt on them) "normal", something the Jones' do! AND...
7. While it may have started small, with small goods and services, soon people became even more loose with their credit, and started buying cars they couldn't afford (thanks to the overly greedy creditors) and then houses that they couldn't afford, too (thanks to the overly greedy mortgage lenders) (which caused the booming real estate market) Which led to...
8. A crap-ton of debt in America. ("But everyone has it!") That people ALREADY couldn't afford or handle.

THEN,
a. fuel prices went up almost 200% in six or seven years due to many different reasons, which lead to...
b. consumer goods and food prices going up, especially in the last year and with no rest in sight

And now people can't pay the mortgage they couldn't afford in the first place, nor can they gas up their vehicles (that is likely financed, possibly having problems paying the car payment itself). And if that's not bad enough they may have to go hungry so that their children can eat. Bills are unpaid on a nationwide scale, creditors don't get their money, and banks fail, people panic, stop buying so much (at least temporarily), business profits go down, prices go up, people lose their jobs because thier companies can't afford to pay them, more bills unpaid, completing the circle.

ANYWAY to answer the OP's question, I think there were a lot of different factors that turned into a few big problems that are forming one big crisis. It's like the perfect storm. Yes, I think at least one reason why fuel (and hence food and other goods) is now so expensive is that investors (especially people that already have boatloads of money) saw the credit crapstorm coming, and realized one of the last places people would cut back would be fuel, so they started investing heavily in oil futures, and then people started jumping on the bandwagon. Of course there are many other factors other than this that contributed to the problem, though.

ETA: ITA diamond lil, I forgot about ethanol. Doesn't it take more energy to make ethanol from corn than it actually has in it? That, along with precious farmland, makes it a big huge mistake.
I like this thread, there's a lot to think about. I love how there's such a great dialoge here, and maybe someone who reads it will take a step back and reevaluate how they are living their lives (and hence how they are teaching their children how to live, since kids learn most effectively through example).