By Jeff Gerritsen 11/21/2008 at 00:09

The current occupant of the White House has left the biggest mess the world has ever seen. Hear is the dilemma: the consumer economy we all knew and loved looks like its DOA. There will be pressure from from everywhere to keep it hooked up to costly credit life support.  However, I believe A different economy is waiting to be born, but it is nothing like the one that is on life support. The economy-to-come is one of rigor and austerity. I wonder if it is the kind of thing that a nation of leisure is used to?

The collapsing consumer economy seems to claimed another casualty - the car industry. The Big Three, at this point are functionally bankrupt. Their CEO's flew separate corporate jets to Washington DC begging for government handouts. Personally, I believe the age of Happy Motoring is just about over. Many Americans may have already bought their last car -- they just don't know it yet. The current low oil price is a “quarter back sneak”, having more to do with asset-dumping in the paper markets than true resource supply and demand. Most of the world (the corporate media for sure) has ignored the latest International Energy Agency's (IEA) report forecasting global oil depletion to be 9.1 percent in 2009. This is a staggering figure, very likely to eclipse any savings from global demand destruction caused by the worldwide economic crisis. The global oil markets seemed to be poised for the most severe dislocations ever seen, meaning it's a toss-up what happens first in the USA: a major increases in oil prices, or shortages, hoarding, and rationing. This can be considered the classic beginning phase of "Peak Oil".  From here on out we begin the arc of depletion.

With Peak Oil as a back drop, two main reasons come to mind regarding what to do with the car industry at the present time: one, keep one of the auto manufactures because we need somebody to manufacture engines for military vehicles, and two (most important), retool the remaining auto industry assets to manufacture rolling stock for the revival in passenger rail service that will have to be a centerpiece of the future economy if we want to remain a civilized nation.

There you have it – my comments on the big three bailout!