What, if anything, can the government do to help us through this economic nightmare?

Question

i just spent 800 dollars on oil and i didnt even fill the tank. prices are rising all accross the board. between oil, gas and food we barely have $ for utilities and mortgage. if our bills get paid, its always late.

something needs to get done but what?

Answer 1

The things that needed done, needed done about three or four years ago.  It is going to get much worse.  Our entire society is facing a liquidity crisis.  For a very long time now other countries have been lending money to Americans, directly or indirectly, at very low interest rates, really beginning during the Asian currency crisis.  We owe the world extraordinary sums of money.  The Federal Reserve put out a report some time back titled, "Is the United States Bankrupt."  The answer was yes, if nothing changed.  Our current obligations exceed the value of all privately held assets.  If the government seized all private property in the United States and sold it to foreign powers, we would still owe money.

There is good news however.  The Chinese central bank holds $1 trillion in US currency.  The entire American banking system combined only holds 46 billion dollars.  They have 25 times the amount of money we have.  Money is a claim on future production.  We owe the Chinese $1 trillion in goods and services.  That money has to eventually come home.  When it does it will provide an enormous amount of work for Americans.  The downside to this is that for the last couple of decades Americans have been able to outbid other citizens of the world for goods and services, we are going to fall many pegs down the list in purchasing power.

Every American needs to expect to have much less.

In the short term the only constructive thing the government can do is free up the economy from protective regulations such as minimum wage and so forth and invest in research into alternative energies.

Answer 2

Simple... Get George W. Bush to STEP DOWN NOW!!!

Answer 3

Since you spent $800 on oil, I'm guessing you're a trucker. I'll tailor my answer towards how it impacts your profession.

You're right, it is a nightmare. I'm not sure what can be done, honestly, in the short-term because we have so little control over crude oil. Over the long-run, we can implement several measures to increase supply or decrease demand. Over the short-run, the only possible action is some sort of rebate of federal and state gas taxes to long-haul drivers.

Short-run fixes:

1) Release the Strategic Petroleum Reserve - which will boost supply by about 5% for two months, so you won't see much relief.

2) Lower the national speed limit to 55 or even 50 to improve gas mileage nationwide. But I'm not sure if this makes the lives of truckers easier or harder.

3) Ration days and times of driving for non-carpool non-commercial vehicles. This would force commuters to either carpool or stay off the roads at certain times, which at least would keep truckers from sitting in traffic for hours. Of course, the commuters wouldn't be happy about this, neither would business.

4) Mandate the allowance of a diesel-cost surcharge on every load the truckers deliver to help independent long-haulers recoup unexpected price increases. I don't think business would like this much.

Some possible actions over the long-run:

1) Drill in ANWAR.

2) Construct new refineries to process the additional crude from ANWAR.

3) Mandate higher CAFE for all personal vehicles to improve the fuel economy.

4) Give tax breaks to companies for telecommuting technology to encourage workers to work from home 2 days/week.

5) Replace the currency system of pricing crude (speculation on futures markets) with an auction system in which only those engaged in the business are allowed speculate. Some would call this unfairly helping the oil companies.

6) Privatize the oil refineries. This is somewhere between socialism and despotism, but it'd convince anyone paying high prices that at least no one is profiting from them in the US.

I think what will ultimately come out of this is:

1) Most independent truckers will go out of business or merge with or form companies to share the costs around.

2) The nation's shipping industry will shift to heavy rail (which will need to be built up to greater capacity), and truckers will be mostly short-haulers to go from railyard to destination. You'll see fewer coast-to-coast trips (mostly for post or produce), and the costs of these goods delivered coast-to-coast will rise. The end consumer will absorb the cost.

Truckers are being squeezed the most right now, but that will change as new contracts are written and many small trucking businesses go under. It is a shame, but the economy has changed greatly. It was very cheap gas prices (I remember 74 cents a gallon in Missouri in 2000) that encouraged many drivers to make their own truck companies, and encouraged industry to choose trucking as the means of transportation, but it is very high gas prices (consider that they've quintupled in 8 years) that will change that.

Answer 4

The first things first -- sell your [assumed] truck, find another job for the time being, put the wife & kids to work or whatever else is possible to get atop your bills.  There's not much time left to do it.

The high prices are the result of inflation caused by expansion of the money supply.  Our dollar is buys less every trip to the pump or the grocery, and it's heading toward hyperinflation and economic collapse of our once-great country.  

The government really can't help because it's bankrupt, and will have to admit that to the world within this year.  Applying more government force will make matters worse.  Those stimulus checks are just a small portion of national debt which has mushroomed beyond manageable.

Yes, something needs to be done, but the politicians of the DemReps and the media are afraid to address it, so we must assume they have no answer.  It's even worse because the current candidates are responsible for this mess, and we'll have no voting choice again this election.

This Inflation is a problem which needs immediate correction, but  perhaps there are only long-term solutions.  The only move which might prevent the collapse would be prohibiting the Fed from manipulating the money supply; that should have been done generations ago.  

Only zero inflation is acceptable, anything beyond that is theft which makes everyone poorer.  It's not gonna be much fun in the meantime. So do what you can to prepare for survival.

Answer 5

We have seen this before, where the Kings or Governments push people to move into the cities with economic crisis. The gas prices are doing just this, people are losing their houses and being forced to move into the cities into apartments. The answer to all of these types of events historically, is revolution.