Monday, August 27, 2012

Pinata Capitalism

If economic growth requires increasing the supply of limited resources than it can not possibly be sustainable.  It may work in the short term, but eventually it leads into economic abyss.  No numbers or statistics are required, the shape of the curve is enough.

If the strategy for economic growth requires increasing the supply of limited resources to drive market prices lower, eventually the decreasing supply of the limited resource will limit the increasing demand by creating a shortage and price increases that will derail growth.  This is really simple shit people.

In order for an economy to grow, it needs to first be sustainable and for it to be sustainable we need to continually find new ways to reduce waste in the consumption of our limited resources. By reducing waste in consumption we maintain our standard of living while reducing the demand and this will lead to lower prices that will spur more economic growth.   It's a concept that could lead current political enemies into agreement about economic and environmental strategies.   Eleven words sum up my entire point.   
The enemy of economic growth is wasted consumption of limited resources.     

But when politicians are under the influence of short-term profits, they promote short-term solutions.  Here is a classic case of a plan that fails even if the plan works.  There is no possible way this strategy for economic growth can sustain itself.   Mitt just wants to bust open the pinata and let people grab what they can while the getting is good.

Romney Energy Plan Would Expand Oil Drilling on U.S. Land and Offshore
HOUSTON — Mitt Romney plans to unveil an energy plan Thursday morning in Hobbs, N.M., that would allow states more control over the development of energy resources on federal lands within their borders, as well as aggressively expand offshore oil and gas drilling — including along the coasts of Virginia and the Carolinas — as part of a broader effort to reach energy independence.
Mr. Romney has raised considerable money from donors with ties to the oil industry. Over the past two days, he pulled in nearly $10 million in oil money: $6 million to $7 million Tuesday from two fund-raisers in Texas (in Houston and Midland), and $2 million at a fund-raiser Wednesday in Little Rock, Ark. Claiborne P. Deming, who introduced Mr. Romney at the Arkansas event and is a finance co-chairman in the state, is chairman of Murphy Oil, a global gas and oil company.

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