The price of crude oil in the world markets continue to rise, fueled (editor: do you really need this bad pun?) by the unrest in the Middle East and North Africa. So, what does this mean, again, for the economic recovery underway?
The Economist is being ultra-cautious in its tone, which surprises me a little bit, and also worries me that much more:
At its worst, the danger is circular, with dearer oil and political uncertainty feeding each other. Even if that is avoided, the short-term prospects for the world economy are shakier than many realise. But there could be a silver lining: the rest of the world could at long last deal with its vulnerability to oil and the Middle East. The to-do list is well-known, from investing in the infrastructure for electric vehicles to pricing carbon. The 1970s oil shocks transformed the world economy. Perhaps a 2011 oil shock will do the same—at less cost.David Leonhardt is worried that the oil prices are one of the big reasons why we are "flirting with a repeat of an economic reversal"
An economy typically does not even begin to recover for several years. Our economy has made enough progress that recovery still looks like the most likely outcome this year. But until the recovery is all but undeniable, we should assume that it is in doubt.Ok, these are typical of economists, one might say, to be dismal. Environmentalists ought to cheer the rapidly rising gas prices, right? So, why aren't they?
That's the question that AOL News' John Merline is asking. He takes a look at data from the past few years and the recent increase in gas prices and notes that most green policies have as their goal hiking prices to curtail consumption. And that's exactly what's happening. Bigger costs, economic slowdown, lower rates of travel, fewer imports, you name it. Everything is going the greens' way.
Nevertheless, as NPR noted in a story it did a few years ago, the best environmental groups seem to be able to muster is to "quietly welcome" high gas prices.Whole thing here.
Of course, openly cheering higher prices wouldn't exactly win these groups a lot of friends. Just look at the guff Energy Secretary Steven Chu is taking today for his 2008 comment that "somehow we have to figure out how to boost the price of gasoline to the levels in Europe." Still, whatever happened to having the courage of your convictions?
So come on, greens. Let's hear it loud and proud for higher gas prices.
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