While America’s manufacturing sector had been reduced to its lowest point in years, both in production and employment, the U.S. one-time lead in the global arms market has been slipping even faster.
Although still the top seller because of the dominance of global top commercial/military aircraft sales (Boeing and Lockheed/Martin), the U.S. now accounts for less than one-third of the world’s arms exports, down from two-thirds of the world’s export total in 1999. While accelerating slippage during the past eight years, due to the Obama Administration’s severe military cutbacks in general, China, Russia, and even little South Korea have forged ahead, both domestically and in exports, in flexing their military muscle for economic, as well as political advantage.
China, especially, is particularly advanced as it expands its Southeast Asian dominance. Beijing has cut deeply into America’s arms sales to Asia in particular, while gaining a significant reputation as a world-level armorer.
This U.S. slippage, which continued its arms production cutback as part of the American nation’s budget-cutting, has sent a message to the world at large of U.S. “isolationism,” in face of rampaging “enemies” in the Mideast, Africa, and even parts of South America.
While lack of expenditures for the nation’s badly lagging infrastructure have been hit hardest, strangulating manufacturing Environmental Protection Agency strictures, and the Dodd-Frank hindrances have contributed to the assessment of the U.S. as a dwindling superpower. This is particularly ironic since the Soviet Union literally handed the lone world power leadership to the U.S. as the Soviet Union broke up in 1990, thereby losing significant population, and manufacturing capability.
At the same time, multi-billions spent in renewables, such as wind, geodesic, and solar power panel energy development have turned out to be generally ineffective, with some of the latter ending up in bankruptcy.
Ethanol, which continues as a 10% component of each gallon of gasoline, remains despite the U.S.’s growing capability in surplus crude oil production.
Whether the Trump presidency can right some of these shortcomings remains to be seen as a formidable challenge.
When a strong crowd of 28,000 showed up on a hot night in Mobile, Alabama in late August 2015, it was an early tipoff that the reason for this adulation, Donald Trump, was an early presidential candidate to be reckoned with.
This unique emotional projection inspiration, has been the advantage of recent times’ Presidents, such as Franklin D. Roosevelt, John Kennedy, and Ronald Reagan. All possessed this innate ability to magnetize large crowds, no matter what their political viewpoints indicated or how effectively his opponents countered such potential policies.
Among historical global leaders, it has been their inspirational capability that enraptured such publics, driving them to embrace enhanced victory or dismal defeat.
The outstanding example of such extreme inspiration was best expressed in the period leading up to World War II. The epitome of evil, Adolf Hitler, totally hypnotized the bulk of the German population, leading them to commit execrable acts of inhumanity, before their inevitable destruction at the hands of the Allies. The inspiration indication that stood in Hitler’s way, called him out for what he was, and became the oracular force of his eventual demise, this was Winston Churchill.
Although the heroic United Kingdom stood alone at the height of Hitler’s destruction of all European opposition, it was Churchill’s voice that best amplified the bestiality of the Hitlerites; even though it was the U.S. and the Soviet Union that provided the overwhelming force to bring Germany to its knees.
While the pundits of the overwhelming one-sidedness of the American media were assured that Hillary Clinton would be the 45th President, right up to the night of the November 8 election, none of them reckoned with the hundreds of thousands who streamed to the scores of appearances made by Trump, almost everywhere in the U.S.
The gap of inspiration between the Republican and Democrat presidential candidates was so wide, that it escaped the most insightful commentators, who totally ignored the historical reality of inspiration.
Whatever the future holds in store for the current President, his continued inspirational hold on the American public, at large, will provide him with inspirational, emotional hold, which neither Congress nor contrary vocal opposition will be able to override in the years ahead.
When reading the latest copies of Time, Fortune, Forbes, and Bloomberg Business Week, I recall when Time, Newsweek, Life and Fortune were looked forward to weekly, as the prime progenitors of the weekly world news, to gain ongoing in-depth evaluation of important events.
This was a generation ago, at a time before TV, digital, and the 24-hour din of multi-faceted “webs” of varied origin springing forth, presenting ongoing factor opinion. This makes the need of books and other written material to gain in-depth informational data of increasingly lesser importance.
Even dictionaries, informational studies, and in-depth sources, such as “Encyclopedia Britannica,” have become increasingly unimportant. The vast multitude of information readily available without the intensity of research have had a rapidly increasing impact on those needing, or wanting quick information access.
As these rapid changes are in a state of flux, it is still questionable as to how intense the “end-result” will be, as we approach the end of the current decade and beyond. Already bookstores have been hit hard. Such book analyses as those appearing on the New York Times best-seller list, usually relate to special events, or are written by famous personages teaming up with writers to cater to a ready-made public. The O’Reilly series about the “killing” of historical figures is a relevant example of this current readership direction.
With the complexity of everyday life, learning, and time unavailable to spend the hours necessary to imbibe information, as in the “good old days,” the voluminous and easy access to the most complex and in-depth information is now available through such search engines as Google, Yahoo, Ask.com, Bing, etc., or a multitude of special interest information areas, which are becoming boundless. Ironically, the multitude of such easy availability has made history, current events, and specific objective interest subjects much simpler to research.
Whether this will eventually make for a much broader, well-informed public in the future, only time will tell.
With the confirmation of Secretary of State, General Rex Tillerson, and Secretary of Defense, General James “Mad dog” Mattis, with President Donald J. Trump at the spearhead, America is projecting an image of newfound respect. This is countering the slide toward reactive impotence, starting since the wanton Islamist attack on the U.S. on September 11, 2001.
In the more than 15 years following, extremist Islamism, as represented by Russian-backed Iran and the emergence of ISIS have become a threat to the Western World, and the U.S. in particular. The apparent attempt by Presidents George W. Bush to accept Islamism as reasonably tolerant, and successor Barack Hussein Obama supporting increasing hostility toward Israel, have put the U.S. in a weakened position as a counter-force to the spreading of Mideast-sponsored terrorism.
The apparent military leadership, together with a return to a strong “terrorism” counter-force under the direction of President Trump’s effective stewardship, is putting America’s erstwhile enemies on notice that the days of tolerance, and supporting hostile, anti-American United Nations declarations are over.
It is expected that a strong revitalization of America’s power will telegraph a new red line to Islamist terrorists. It will indicate that crossing that line will result in a strong American counter-force reaction, whose aim will be to crush any further attempts to export increasing terrorism, under its several flags, to the U.S. proper and its allies.
The buildup of a badly-deteriorated U.S. military presence in the last eight years in particular must follow the Reagan-like rebuilding that forced the Soviet Union to give up its superpower status. Unfortunately, the U.S. did likewise by tolerating an administration direction that had weakened the U.S., both in its foreign policy strength, as well as its previous dynamic domestic economic growth.
President Trump’s first 100 days will provide insight as to how fast, and intensive, the aforestated objectives will be fulfilled.
Although President Trump’s approach to “populist” domestic production centers and “Made in America” employment growth has generated intense enthusiasm among America’s rank and file, his personal pressure over conglomerate business giants may have unintended consequences.
While two-terms of the Obama Administration management have witnessed severe industrial employment shrinkage, the nation’s low cost consumption has been the prime beneficiary. While it has impacted the greatest reduced cost of energy derivatives, steel, copper, and imported commodities, in general, the American consumer, comprising 68% of the U.S.’s world-leading gross domestic product, has benefitted substantially.
Although the cost of labor has remained relatively stable in the past eight years, the number of potential employees, working part or full-time has also slowed. Now the big question to be answered is whether the upward direction of interest, costs of domestic and imported goods, and their possible lesser availability, will redound positively with an American population approaching 350 million by mid-century.
While the benefits from lower corporate and middle class taxes may prove positive enough, the higher monthly costs of family consumer expenditures could put on an additional squeeze.
While reduced regulations will likely engender record “small business” development and growth, import/export balances may prove counterproductive; as America’s huge business/professional balance sheets absorb the many “changes.” These are due to manifest themselves aggressively, at least in President Trump’s first two years. The big question yet to be answered is whether the new bottom line results will be welcomed by America’s population as a whole.
When approaching America’s near $20 trillion future gross domestic product, and a slightly higher Treasury debt at best, much of the Trump economic victory “trumpet” will depend on how this contra-cyclical number of changes will be accepted by the expectant U.S. population.
It should be remembered that President Ronald Reagan, facing a similar set of contradictory circumstances, in which the first two years of continued high inflation, and the trickle down on Reagan’s total reshaping of the U.S. economy as a whole was still in question.
While Trump’s bevy of obstacles are of a different complexity, the “light at the end of the tunnel” must become increasingly apparent by the 2018 mid-term elections to maintain the overwhelming support of the voting public by then.
In the wake of disbelief over President Trump’s solid (306-232) electoral college victory, the overwhelming bulk of the nation’s media, and other anti-Trump partisans, put the blame of defeat at the feet of the College’s very existence. This is a 180 degree shift that credited the “college” with certainly formalizing the rejection of the Republican contender, before the election.
Readers, listeners and viewers are now exposed to the “farcical” nature of the electoral college method of establishing the “will of the nation” by switching to a popular vote plurality. Those who subscribe to this “double-think” should acquaint themselves with the wisdom of America’s founding fathers:
1) In order to establish unanimous support among the 13 states and 3.5 million people comprising the longed-for United States, the constitutional forebears realized, at that time, that even the smallest states (Rhode Island, Delaware, etc.) must be recognized by a proportional percentage of a number representing their House of Representatives membership, plus two senators each from the largest and the smallest states.
This compromise was urgent in creating the glue that brought the United States together, and held it there, despite a disastrous Civil War and other infractions.
While the presidential election’s “sore losers” now blame the electoral college, this was a turnaround by their media supporters, who praised its existence when their candidate looked like a sure winner.
Although this called-for change is impossible to happen, with the House, Senate, and the 50 states having to post a two-thirds majority vote, such a change to popular support would put future presidencies in the hands of California, Illinois, New York, and Texas, who together comprise close to 40% of the U.S. population.
Under a popular vote, won only a second time last year in the 45 presidential elections, the role of an overwhelming number of smaller states would become inconsequential.
The rapid urbanization of the United States will make the popular vote even more lopsided, as the rural and even the suburban population fades into increasing minority status.
With the socio/economic/political gap between the big cities, and the pastoral “fly-over” states making up the vast geographical majority, a one-sided political tyranny would be an almost certain result.
The United States of America has always prided itself in its Constitutional restraint against radical change. Despite increasing pressure of change to the contrary, a breakdown in the “law and order” of our threatened current status could open the door to the termination of America’s greatness.
When President Dwight D. Eisenhower warned the Americans about the “military/industrial complex,” he was concerned that America was on the verge of getting involved in overseas “brush fire wars.” His point was that the huge conglomerates of his time were involved financially, benefitting from such strife. Ike, who had successfully put an end to the Korean peninsular war, was gravely concerned about such an unholy alliance— between the nation’s military power structure and the industrialists.
His predictions sadly came to pass after his successor, John F. Kennedy’s assassination, when Lyndon B. Johnson decided to go all out in what had been a potential north/south Indochina military confrontation. The 50,000 dead American soldiers and the subsequent domestic U.S. internal problems that followed proved Eisenhower’s predictions all too correctly.
However, after the two-term Obama pendulum has swung too far the other way, President Donald J. Trump is correctly approaching the ongoing world and domestic economic problem— if his cabinet choices are any indication. The surprising addition of former Exxon Mobil CEO General Rex Tillerson, as Secretary of State, indicates Trump’s preference for global experience.
The choice of “Mad Dog” Mattis, the former four-star Marine General, could not be surpassed as a tough Secretary of Defense. Wilbur Ross, an incomparable billionaire industrialist, has the unique independent business background to make the Commerce Secretariat a solid position of helping solve business problems of both export and domestic stature. Those conglomerates now benefitting by export/import activity, as well as providing a production home for American companies, will be watched with an experienced eye.
The combination of cabinet officers seems to have the makings of an “all-star” act. Heavy on business/industry in general, but also on rational taxation understanding, as well as Defense, that has not been seen since the Reagan era. This will recall the awesome potential of U.S. leadership in the eyes of the world, whether friend or potential foe.
Both the balanced experience and talent reflective of this outstanding back-up team will allow President Trump to fulfill the role of a respected world leader; as one who combines the multi-faceted elements indicating the incredible dynamics inherent in the U.S.A.
Coming from the line of historical presidents, such as Washington, Monroe, Lincoln, Theodore and Franklin Roosevelt, John Kennedy and Ronald Reagan, Trump’s colorful, intelligent and powerful personality and a unique flair for communication will assure America’s reborn rise, after decades of relative shortcomings at the top.
When the broad U.S. stock market set new records in the wake of President Trump’s election on November 8 last year, it went against the “ so-called” experts’ predictions, which expected just the opposite.
This belief was strenuously fed by a one-sided American media that propagandized a GOP victory as the forerunner to another “great financial crisis,” similar to the 2007-11 downward spiral.
It’s no accident that this same left-wing-controlled string of newspapers, TV shows, and magazines have been strangely silent about the economic misdirection of the Obama regime, which wasted a near trillion dollar Congressional “gift,” by spending that large amount on the emergence of Obamacare, cap-and-trade, and several eventually bankrupt solar panel companies. That period also saw the doubling the U.S. Treasury debt from $10 trillion to near the $20 trillion mark. At the same time, the emphasis on “small business” strangulating regulations (Dodd-Frank) made 2016 the worst year for the “independents” in a generation.
The miraculous electoral victory of Trump has put American business genius in charge of the most prolific combination of population (330 million), fossil fuel reserves (coal, oil, natural gas), agriculture, and metal commodities, plus the most innovative technology the world has ever seen.
With a group of experts comprising the team to finally take advantage of America’s superb “firepower,” the positive reversal of White House leadership will catapult the U.S.A. back on top, where its potential advantages had previously been ill-used.
Rebuilding the once world-leading manufacturing sector will be high on the list of the new President’s first one hundred days. With the advantage of an overwhelming House majority, and a slight advantage in the Senate, President Trump has the potential support base in place. The previous turnaround champ, President Ronald Reagan, did not have this advantage when being inaugurated on January 20, 1981. Furthermore, Trump has the opportunities of a near all-time low interest rate, while Reagan had to face a two-year battle to crush a monetary inflation that had shot completely out of control.
The year 2017 contains a combination of solvable problems, such as a rational overall income tax approach. High on the list will be the rebuilding of a once dominant global manufacturing sector, much of which had scattered to low cost overseas production, such as in China, Southeast Asia, and Mexico. This will be done positively by tax incentives, and punitive tariffs for U.S. conglomerates’ offshore production finding its way back to the home country.
Also high on the list is an approach for bringing back the multi-trillions of U.S. companies’ profits, by setting up a reasonable (10 percent) permanent incentive. If Trump is successful in accomplishing most of these objectives, the 45th President will grace U.S. history as one of the greatest.
The words may have changed, but what used to be called ultra-nationalism, or one-world diffusion, are better known in the dictionary of world history as populism/globalism.
Both of these approaches to the governance of the fast-growing world population have been tried since the end of World War I, and have failed in varying degrees since that time. The globalism imposed on postwar defeated nations with the Versailles Treaty, scripted by then U.S. President Woodrow Wilson, a former President of Princeton University, fell apart with the dissolution of the failed League of Nations in the late 1930's.
The subsequent World War II United Nations is now in the process of following the same fate as the “League;” as the 21st century progresses.
While such offshoots as the European Community, and the attempt to create a Pacific economic partnership are currently in the process of falling back on populism (ultra-nationalism) in various degrees of intensity, globalism (the one world diffusion) is rapidly pulling a fade-out.
The nationalism leadership portrayed by the likes of Russia’s Putin, Turkey’s Erdogan, Egypt’s el-Sisi, and Israel’s Netanyahu is indicating that the strength of nationalistic leadership is rapidly gaining the upper hand on the world power scene.
Such perceived international weakness, as reflected by former U.S. Presidents Obama and Jimmy Carter, have weakened America’s superpower status, resulting in waning influence over foreign policy; while strengthening the hand of the aforementioned leaders. This is happening, despite their relatively weak economic growth, but perception of solid support from a pride-regained population.
It may very well be that the election of hard-fisted, domineering leadership, as indicated by the surprising election of President Donald J. Trump, is putting the U.S. back on top of world respect. Even submission to the U.S. influence that has consistently deteriorated since the 9/11/2001 “Twin Towers” disaster is being reversed. This tragedy was orchestrated to a large extent by the evil-doers emanating from the Islamist Middle East, many of whom have financially supported Democrat Presidential candidate Hillary Clinton’s multi-million dollar “foundation.”
Although President Trump is dramatically repeating President Franklin D. Roosevelt’s innovative first 100 day doctrine in establishing his unique leadership style, the greater story will be told by where the world stands at the end of December 2017.
Whatever happens in between will surely orchestrate a major change from domestic and foreign policies in the U.S., and the rest of the world, as the forthcoming year progresses.
A key element of President Trump’s attempt to substantially increase U.S. manufacturing employment and inflate gross domestic product growth is a projected 35% tariff imposed on products shipped back to the U.S. by foreign-based American companies.
A major case in point was Ford Motor Company’s announcement that all “small cars” would be produced in that leading automotive giant’s Mexican plant. Since this decision was made prior to Trump’s election, time will tell whether Trump sticks to his “penalty tariffs;” and whether Ford and other manufacturing companies will “pull back” from the major penalties that would be incurred if Trump’s warning is ignored.
It goes without saying, that both former two-term Presidents Obama and Bush did nothing to forestall the flight of hundreds, if not thousands of companies— especially conglomerate divisions— to low-cost manufacturing all over the world. While driven by higher profit margins, engendering improved profitability, this had been done during the last 25-20 years, with impunity. This had the effort of cutting full-time factory workers from 20 million to 12 million since the turn of the millennium.
This shrinkage was speeded up by dramatically evolving technology, and Obama’s indifference to the rapid melting of the manufacturing sector. The outgoing President seemed to be impervious to the damage done, especially to “small businesses. This was incurred by a combination off Dodd-Frank regulations, the war on coal, and the influx of “open borders,” which put an ever-increasing number of U.S. workers on the unemployment line, and dependent on U.S. Government handouts.
A further negative undercutting the U.S. economy was the one-sided nature of numerous bi-national and multi-national trade agreements favoring foreign negotiators, signed by President Obama. This Administration’s attitude did much to put a record number of privately-owned corporate entities out of business.
This was in addition to the lowest startup number in the past 25 years, shrinking the number of total independent businesses left standing. The past eight years also set a new record in percentage and number of part-time workers making up America’s once overpowering global industrial superiority.
President Trump will have his hands full in a massive attempt to reverse the all-time high executive orders of the Obama Administration, and the indifference to infrastructure upgrading, while spending a trillion dollar debt addition on climatological purity, controversial healthcare, and the attempt to minimize fossil fuels with renewables. The latter are already proven totally impractical.
As in-depth students of history well know, the military Austro-Hungarian empire entered the 20th century with hope and optimism.
With a population hardly larger than Israel today (8 million), many of the Austrian patriots, including my father, a highly decorated army officer during World War I, believed that Vienna, Austria’s capital, would set the tone of Europe’s civilized future. This would include leadership in music, psychology, art, writing, and gentility, as becoming the best that the Western World had yet to offer.
This went up in “smoke” after a Serb terrorist assassinated Austria-Hungary’s Archduke Franz Ferdinand and his morganic wife, Sofia, on June 28, 1914
The nadir point of that misbegotten early 20th Century nation did not foresee the mighty empire’s total breakup, as World War I ended on November 11, 1918; leaving that once great empire with an overpopulated Vienna, harboring more than half the eight million residents with which Austria was eventually left.
Although noone thought things would get worse, after the Versailles Treaty they swiftly deteriorated. No better example of post-war turn of events, was a pre-Nazi revolt in the early 1930's that led to the overthrow and murder of the conservative-led Engelbert Dollfuss regime, and a bloody outburst of anti-Semitism against Austria’s large Jewish population.
While some semblance of order was restored by the intervention of Italy’s dictator, Benito Mussolini, who warned the newly-born Hitler regime of interference, Germany delayed taking its first step toward Europe’s conquest in February 1938, precipitated by an impending plebiscite, as to whether Germanic Austria wanted union with its big brother.
To forestall negative vote results, Adolf Hitler sent in his troops to guard against negative vote results. He need not have bothered. The overwhelmingly German Austrians enthusiastically embraced their northern confederates, and immediately launched a vicious attack on the Jews, exceeded in its ferocity by anything that Germany had fostered up to that point.
Not well-known is that the first concentration camp to murder its inmates was Mauthausen-Gusen, which subsequently annihilated a majority of the mostly Viennese Jews within Austrian borders.
Today’s Austria is inconsequential as a major factor in the European Community, and is politically split between a Socialist plurality, and an economically conservative, Alt-Right political group that garnered 46% in the most recent elections.
The last great emperor of Austria, Franz Josef, who died in 1916, was spared the sad events that
succeeded his death; and the degeneration that exceeded his worst expectations.
The latest Presidential/Congressional election reemphasized a reality that has become increasingly politically divided, with its overall 330 million population leaning slightly to the Democrat side.
While the leading populous states of California, New York, and Illinois, plus New England, provide the Democrats with a slight population majority, most of the rest of the country, led by the Southeast and Southwest, generated enough “electoral” votes to overcome the “liberal block,” as was the case in the 2016 election.
Although each of these regional geographic areas harbor substantial minorities of the opposition political parties, their geopolitical makeup indicates that such voting commitments are not likely to change in the foreseeable future.
This is due to the ongoing political traditions that comprise the Democrat populace, heavily reflective of big cities and their historical liberal voting groups of minorities, millennials, and college-educated men and women.
The numerical shift in favor of the latter groups bodes well for the Democrat Party in the forthcoming future, due to their expected growth— both in numbers, and as a part of the voting population.
On the other hand, the Republicans will continue to control the heavy majority of governors, state legislatures, and the House of Representatives.
The GOP depends on this makeup of primarily Caucasian men and women, and the massive production-oriented population, whose manufacturing jobs have disappeared; and the “small business” sector, beset by accelerated regulations, as well as the huge wave of imports, primarily generated by the large metropolis-centered U.S. conglomerates.
Most independent businesses and workers resent the regulatory overkill by such Government sector groups as the Environmental Protection Agency. The EPA and its progenitors continue to concentrate on shutting down coal mining, “fracking” expansion, and infrastructural development restraints. These activities are primarily found in the Midwest, Southeast, and Southwest.
Future political domination by either of the two major voting blocks will depend on whether the current big city-centered Democrats, or more agrarian, and independently-owned small business sectors will control the majorities in future elections.
With the imposition of the most confrontational foreign policy since the Nixon Administration, President Trump let it be known, early on, that he will no longer cater to the “sensitivities” of foreign nations to buy “peace at any price.”
Such “America First” consideration appeared to be jeopardized by an apparent diplomatic blunder in recognition from Taiwan’s “Head of State’s” congratulatory phone call, interpreted as recognizing President Tsai Ing-Wen as an independent nation’s leader.
This seemed to reverse the Nixon/Carter policy of yielding to China’s 1979 demand of accepting its eventual sovereignty over Taiwan. It ended the appeasement that started with Saudi Arabia’s oil embargo in 1974, followed by a long line of “deal-making” with antagonistic nations for the purpose of “peace at any price. Such appeasement led to the downfall of Iran’s Shah, which President Jimmy Carter encouraged by instigating the return from French imprisonment by the Ayatollah Khomeini.
This attitude extended throughout the Bush family, and Clinton presidencies. It resulted in cheap prices for the consumer sector, (68% of the US gross domestic product), but also abetted the decline of U.S. manufacturing and the loss of millions of employees, previously employed by America’s broad range of factories.
The next few months, during and after President Trump’s first 100 days, will determine whether the 45th President will make good on America First; by cracking down on the North American Free Trade Authority (NAFTA) and the many global trade deals tilted in favor of foreign nations, party to these deals. This encouraged cheap imports, but also record trade deficits.
If President Trump solidifies the positions enumerated during the fiery political campaign of last year, there is a strong possibility that America’s imports and exports will decline. It will also likely lead to a return of trillions of U.S. corporate dollars to America, encouraged by a “10% or less” tariff, and a rebound in U.S. manufacturing employment and new factory construction.
With a strong Congressional majority supporting Trump’s “Pax Americana,” such massive changes in a short timeframe will become a realistic possibility.
But, like all drastic changes, looking good in their projected manifestations, their eventual outcome, good, bad, or both, will only become decisive, once their actual impositions are put into practice.
Although the vast energy development arena displayed guarded optimism after the first OPEC cutback in years, crude oil price increases for both Brent crude and WTI will be limited throughout the rest of this year.
The stratospheric record $145 per barrel price of July 2008 was a momentary aberration. Even the $100 plus price range that found its way back in 2011, after the financial crisis deep dip, is out of the question, under the supply/demand circumstances expected in the foreseeable future. As the year’s energy sector demand/production developments take hold, it will be more likely to anticipate a price settlement in the low $60 per barrel.
Even with the OPEC token cutback, this amounted to only 1.2 million barrels a day from the ongoing volume of 33.6 bpd, which OPEC produced throughout 2016. There is no mandatory guardianship to certify the OPEC level, roughly a third of world demand, and such bankrupt economies as Nigeria and Venezuela will be tempted to exceed quotas, along with sanction-free Iran. It’s doubtful that the actual total reduction agreed to at the December 1, 2016 OPEC session with Russia will be more than a token. Whether the markets put credence on the future of this unexpected OPEC move will largely determine where the ultimate highest price gravitates.
It seems that both production and demand oil peaks have been exaggerated. In the last two decades, the equivalent of three trillion potential oil barrels have been discovered:
- A third of these potential reserves have been located offshore worldwide, with potential Arctic supply awaiting exploration and production.
- Canada and Venezuela’s oilsands provide a second third; while America’s cost-effective hydraulic fracturing (fracking) rounds out this growing potential. In addition, the gigantic Wolf shale in the red-hot Texas Permian Basin, with an estimated two billion barrel reserve, is only the latest find. That indicates more huge reserves of this nature are likely to be discovered.
Also, energy independence is no longer an idle dream; since “NAFTA partners” Mexico and Canada, together with the U.S. actuality and potentiality could provide the totality to cover America’s daily demand of 20 million barrels.
Although prices at the $50-60 per barrel level seem realistic for the year ahead, the return to $100 per barrel, which generated the recent phenomenal oil availability expansion, seems like an empty “pipe dream.”
Even the anticipated “breakout” of natural gas use and its derivative availability are expected to satisfy fossil fuel demand in the months and years ahead.
With a world population having reached 7.5 billion at the end of 2016, it’s a near certainty that 10 billion humans will occupy the earth by mid-century.
Not long ago, it would have been inconceivable that such high numbers could be accommodated on this third planet from the sun. Population experts in the mid-20th century estimated a peak of five billion, due to the limitations of food, housing, employment, and atmosphere. At that time of nuclear standoff between the U.S. and the Soviet Union, there were somber predictions that nuclear annihilation was a factor to be reckoned with, due to just such an accident, as almost became reality in late summer 1962. At that pont in time, the gap between the Euro/American world and the overwhelming undeveloped masses everywhere else, seemed irrevocable.
But the economic emergence of China, India, and the fast-developing Southeast Asian block has turned such previous predictions on its head. Noone predicted the quintupling of the Sino/Indian population in a few short decades. Or that this would be accompanied by an economic/industrial development of such once backward nations. These are now near the top of the world’s gross domestic product (GDP) standing.
Despite the rapid evolution of high technology that has overtaken the developed world of the U.S., Japan, Germany, and surprisingly, China, the pace of global population growth has far exceeded the five billion figure, in addition to its economic evolution.
China and India alone make up 60% of the current world population; and such once forgotten growth nations as Pakistan, Vietnam, Bangladesh, Indonesia, and the Phillippines are multiplying their numbers rapidly, while also generating impressive economic growth.
While Turkey, Egypt, and Iran are on the verge of reaching the 100 million population mark, the Middle East is the one region that poses the danger of destructive global war, due to the leadership struggle within the Islamist world expansion. Also, sub-Saharan Africa, and much of South America have yet to equal the phenomenal economic development of much of Southeast Asia.
When looking ahead, today’s predictions could turn out to be futile. This is especially true, since the idea of a unified civilized world (United Nations) is, unfortunately, less likely than originally expected in the mid-Twentieth Century; when the end of the struggle between the U.S. and Soviet superpowers seemed to hold the key to eventual world peace.