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Headed for the Tar Pits

If you are wondering how Our U.S. Federal Government negatively or positively influences stocks, there’s a marvelous recent example of how it fallaciously impacts the worldwide prices of precious energy supplies and stock prices of the producers: There’s an article in the April 5th Wall-Street Journal that serves as a real eye-opener. It’s titled: ‘Natural-Gas Data Overstated’.

Evidently the Federal government has been using rather outdated methods for calculating Domestic Natural Gas Output. It has been extrapolating numbers on known large suppliers, and has been arriving at bloated Numbers.
The problem is, these bloated numbers may have been driving prices down. This will impact the cost people pay for their energy, as well as the way people invest in energy companies. While there may have been some temporary positives for consumers, we all know that there is a much larger backlash when the adjustments come.

This is a perfect example of a how a large, slow, lumbering bureaucracy, growing ever fatter, and dragging its peg-legged health care across the scarred oak floor of our economy has been unable to keep up, and appropriately participate in what is happening in the private sector.
It is a good example of what economists, like Peter Drucker, indicated when they pointed out that ‘Government Control’ of economies is outmoded, outdated, and not the functional future in a capitalistic, or post-capitalistic society. Drucker stated, “Medieval feudalism was replaced by the unitary sovereign state… But the unitary sovereign state has now itself been replaced by a new pluralism – a pluralism of function rather than one of political power – because it could neither satisfy the needs of society nor perform the necessary tasks of community. That, in the final analysis is the most fundamental lesson to be learned from the failure of socialism, the failure of the belief in the all-embracing and all-powerful state. The challenge that faces us now, and especially in the developed free-market democracies such as the United States, is to make the pluralism of autonomous, knowledge -base organizations redound both to economic performance and to political and social adhesion.”
(Someone needs to tell our Congress and President)

Some of the brightest economists have realized that government is a large lumbering dinosaur, and with the Obama administration foisting itself into the private sector we are probably seeing the last raging roars of a giant reptile faced with the coming ice-age. That doesn’t make it any less scary. The last hurrah of a dinosaur, especially a pegged-leg one could endure 30 years.

There is no way that slow moving court systems can keep pace with industrial, technological, biological, and pharmaceutical changes that are happening now at a geometrically increased blinding rate.
The Wall-Street journal article indicates that some new oil technologies, developed within the last few years, technologies related to advances in the industry as well as oil-shale finds and changes in the way companies are working with the new technologies appears to have left the Energy Department in the dust.
What will the Federal Government do when changes in technology happen at an even more dizzying rate? For, with regard to technological advances, I do not believe we have come anywhere near ‘diminishing returns’ as we did with industrial achievements made in the nineteenth and twentieth century, finally realizing their greatest returns and probably tabling off and even declining in the mid to late 1960’s.
Eventually, it will become apparent that many branches of the Federal Government serve no purpose, or can’t keep up with, legislate or rule on changes in private sector industries. At that point it will be up to the people to deliberately and surgically scale the Federal Government back to a light-weight, purposeful and usable size, perhaps the size that Thomas Jefferson envisioned when he originally indicated that the government should keep its hands out of our farms, shipping, shops and industries.
We might add to that list; the government needs to keep its voice and observations out of our reporting mechanisms, as the inaccuracy is dangerous, and the propensity for down-right wrong information impacting our markets daunting.
What will the government do when research and, yes, development that used to take 5 years takes 5 months: Oil companies have developed algae that can eat up toxic plastics in the oceans, and produced beneficial bio-fuels, physicists have developed a particle beam small, yet powerful enough to break up an asteroid coming clippingly close to our atmosphere, bio-engineers have figured out a way to grow arms and legs in laboratories, and some rogue companies are attempting to sell them on Ebay? It’s clear that we need inter-corporate and trade mechanisms, decision making mechanisms between companies that can work faster and more effectively, beneficially and within very limited spheres of influence, bypassing a governmental system that will still be trying to react by the time the asteroid has already passed the planet, and the rogue companies have been disenfranchised from the R & D community due to their horrendous ethics.
If anyone wonders if this could be possible, Google is to be applauded for their standing firm against China’s harassment of their own people through censorship, Kinross Gold Corp mining company provided assistance to people in Chile in the aftermath of the horrendous February 27th earthquake, and there are several large corporations whose stocks are bought by Ave Maria Funds, because they do not contribute to abortions and other misleading and racially destructive initiatives of parent planning organizations.

There’s one good thing about dying dinosaurs, though – more oil for future generations.

-Copyright April 2010 by John P. Schumake


 




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