The passing scene: Links & comments 10/14/14

 Saudis Deploy the Oil Price Weapon Against Syria, Iran, Russia and the US by Yves Smith for Naked Capitalism.

The Saudi Arabian government says it will allow oil prices to fall to $80 a barrel, an action that will hurt oil-producing nations such as Iran, Russia and the United States.  Saudis control so much of the world’s oil that they can set prices by increasing or cutting back on production.

This will be good for American homeowners and motorists as we face another severe winter, but it makes domestic oil and gas production, and also renewable energy, less competitive in the marketplace.  To the extent that the United States is increasingly dependent on its energy industry, this hampers the economic recovery.

Yves Smith quoted sources who think the Saudis are doing this to punish the U.S. for failing to overthrow the government of Syria.

Americans Face Post-foreclosure Hell As Wages Garnished, Assets Seized by Michaelle Collins for Reuters (via Business Insider)

Thousands of Americans lost their homes to foreclosures years ago, and thought they had closed the door on this part of their lives.   Now they find debt collectors coming after them for the unpaid balance.

The most aggressive of the debt pursuers are the two government-owned mortgage companies, the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corp. (Freddie Mac).

Whose side is the government on?

Ebola Vaccine Would Likely Have Been Found By Now If Not For Budget Cuts by Sam Stein for Huffington Post.

Dr. Francis Collins, the head of the National Institutes of Health, said the NIH has been working on a vaccine for the Ebola virus since 2001, and would have found one if not for cuts in the NIH research budget.

Whether a vaccine really would have been discovered is unknowable.  But funds for research on infectious diseases should be increased, not decreased.  The Ebola virus will not be the last mutant killer disease that is invulnerable to known antibiotics.


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3 Responses to “The passing scene: Links & comments 10/14/14”

  1. williambearcat Says:

    I do not understand national economies. The lower gas price, as CNBC, reminded us this morning means approximately $10 billion more for consumers to spend which is good for the economy. But it seems to me it is $10 billion less that the energy companies would have to “invest” is finding more oil and gas and would hurt the stockholders which is bad for the economy.So, which is it?


    • philebersole Says:

      This is good news because, as you say, cheaper oil and gas benefits all of us, not just as consumers but as workers in enterprises that have to pay for transportation, heat and energy.

      This is good news also, in my opinion, because it lowers the economic incentive to engage in fracking, deep water ocean drilling and other destructive extractive processes.

      It is long-run bad news, in my opinion, because it lowers the not just the incentive, but the economic feasibility, to switch to renewable sources of energy.

      One of the trends of the past few years is that the U.S. economy is based less on manufacturing, in which we once were the world leader, to extractive industry such as oil and gas drilling and coal mining. Unless something changes, the USA could wind up being a Russian-type petro state.


      • philebersole Says:

        I think that to the extent the Saudis are trying to influence the U.S. government, they think correctly that Washington is more responsive to what affects the oil and gas companies than to what affects ordinary American citizens.


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