Search For New Thought On Oil Economy Based On America
Dr Surendra Bhakta Pradhanang
August 30, 2008
The United States of America is the world leading country – the superpower – and most advanced in the globe. Recognized as the freedom fighter for world democracy, global economy and terrorism, it always stands frontline for humanity and human right protection. Nothing is impossible for America. It can do and can not do anything of everything.Positively, we understand the United States and its government and people that are more democratic, advanced and progressive in thought and thought application either in political economy or macroeconomics.
The nation having 50 states is largely big in the world map and highly enriched in economic thought and policy standardized. Indeed, there is no shortage of veteran economists in every sector of practical life and people concerned in the U.S.A. The American economists basically Harvard, Columbia and Preston produced are several in numbers who mostly are Noble Prize Winners. They have definitely no lack of knowledge and thought in economics.
For example, in Ronald Reagan´s period, the Noble Prize Winner, Milton Friedman was the economic adviser in many aspects of the economic development of the U.S.A.
Unfortunately, today the United States of America is being faced by inflation, credit crisis, recession and above all – a curse stagflation – as it is likely back to the position of 1970s.
Conditionally, the prices of gasoline topped $4 per gallon in May, June and July. As a result, the sale on truck and car soared dramatically in the car market It is experienced that still about $1 is higher in the oil price than the last year. Right now the national average for a regular gasoline in U.S.A. is $ 3.80.In Virginia about $ 3.55 is the price of the regular gasoline.
As per the recent survey of consumer demand in car market done by Edmunds.com, the General Motor and Ford Motor experienced consumer´s dissatisfaction of increase in weekly price of a regular gasoline per gallon on the one hand and customer´s interest in hybrids and compact cars seeking fuel economy on the other. The report showed that the sales of small car are up 10.9% for the year while SUV sales are down by 16.2% and truck are down by 23.4%.
The U.SA. imports oil from different countries like Canada (20%), Mexico and Latin America (20%) and Middle East (15%).
The American population at a record is 300 million. The people of America worry about increasing trend of price level on gasoline which is badly affected to the American economy. Similarly, the high expenditure cost on Iraq war estimated $10 billion per month is dissatisfaction of the American people.
For over a decade, America imported price deflation primarily from China and India in the form of cheap labour, goods and services. Today that very same pool of cheap labor has earning power and new money to spend out. There are 2.4 billion people combined from China and India together, which is eight times the U.S.population.
Since May 2007 world market price undesirably increased. In accordance with the Time Magazine, market price went up dramatically as Oil-up 89%, Dairy –up 24% and Meat – 12%, Cereals – up 89%, Oils and Fats – 77% and Sugar – up 40%.
The recent Consumer Price Index report of April shows that inflation was running at 3.94 % down from 3.98% in March in the U.S.A. It is certainly high and higher than the Fed´s target rate of 2.2 % estimated.
The Energy Information Administration stated that the U.S.oil demand during the first half of 2008 fell down by an average 800,000 barrels per day compared with the same period a year ago - probably the biggest drop in 26 years.
Until recently, the American economy remains no worse condition, nor non-recovery. It can be as strong as the previous position. The main thing is that the general people are being suffered more in terms of income and employment and inflation on the one side and budget cutting in public welfare administration and care on the other.
Now is the time to think and rethink to develop America better after better until to set a sustainable system and practice on oil or fuel economy in the nation and world. The new thought for oil economy for stability in oil prices and its impact to the American economy as well as global economy is as challenges and opportunities to cure – a chronic economic pain to the U.S. economy. In other words, it is indeed crisis in the U.S.economy as well as world economy as a whole.
In order to solve this problem in the US economy and global economy, Dr Pradhanang who is the eminent economist and Father of Village Tourism of Nepal propounded the new thought - ´The Theory of Common Factor Denotation´
The economist of Nepal, Dr Pradhanang opines, "When the common factor turning into economic factor on goods and services holds the new weight in cost, the price of each commodity tends to increase and harms in the stability of price level – lead to inflation or inflationary pressure. In such circumstances, fixing oil prices at any rate in an agreed stagnation for a periodical duration of time can be a positive check or a principle for growth of oil economy to the U.S.economy as well as global economy which gets a chance to go back to the normal position as a remedial process to the economy as a whole. Then the chain economy instantly in terms of opportunity cost can be worked in progress by multiplying cells as a relief in the national economy."
"Most elaborately, the common factor denoting goods and services - oil price level should not be increased for the period of a specific time e.g. 10 years. Resultantly, the inflationary pressure will come down and the rescue operation will be taken place. Then the opportunities entering or creating into the several microeconomics based activities will be run and gradually expanded if other factors are remaining same or favorable."
There will be a relief in economy showing a sustainable exercise which would cut down inflationary pressure or assist for downturn in inflation by 40 % - 50 % to the causes of inflation in the economy.
To achieve this principle or theory, the following minimum conditions have to be considered as basic ground for normalization of economy:
1. Gasoline as international goods and services acceptable to all nations of the world for common welfare.
2. Need of international common agreement or treaty on the ground of globalization - expansion of global trade and industry and the search of global welfare economy of each nation – developed or developing.
3. The oil exporting countries – especially OPEC Nations should voluntarily agree for fixation of oil prices for the specific duration of time at least 10 years interval as their best contribution to the world population.
4. In lieu of consideration of fixation of price for the specific period of time, the International Community must agree to honor oil exporting countries - OPEC Nations as ´Good Nations for Good World Creation Economy´.
5. A special recognition and honor to the oil exporting countries should be marked at the top of the world economics index. Those nations which are specifically noted as ´Positive Economic Contributor For World Economy´ are provisionally graded to best for world.
6. The common principle sets as one world as brotherhood with loves one to other for uprising from micro and macro economy to global economy.
7. Oil enriched nations gifted by the nature must be obliged and oil as international property should be protected and guaranteed by the world community for their safety, respect and significance.
This is thought for national interest and international benefit. The people and government of the United States of America urge to pay attention to eliminate the economic pain through this proposed idea. This is on one hand a difficult task for implication and a simple way or suggestive measure for upgrading the U.S. economy and global economy on the other.
Possibly, this job can be done under the leadership of the U.S. Every nation should assist to the U.S.in this goal.
The nation having 50 states is largely big in the world map and highly enriched in economic thought and policy standardized. Indeed, there is no shortage of veteran economists in every sector of practical life and people concerned in the U.S.A. The American economists basically Harvard, Columbia and Preston produced are several in numbers who mostly are Noble Prize Winners. They have definitely no lack of knowledge and thought in economics.
For example, in Ronald Reagan´s period, the Noble Prize Winner, Milton Friedman was the economic adviser in many aspects of the economic development of the U.S.A.
Unfortunately, today the United States of America is being faced by inflation, credit crisis, recession and above all – a curse stagflation – as it is likely back to the position of 1970s.
Conditionally, the prices of gasoline topped $4 per gallon in May, June and July. As a result, the sale on truck and car soared dramatically in the car market It is experienced that still about $1 is higher in the oil price than the last year. Right now the national average for a regular gasoline in U.S.A. is $ 3.80.In Virginia about $ 3.55 is the price of the regular gasoline.
As per the recent survey of consumer demand in car market done by Edmunds.com, the General Motor and Ford Motor experienced consumer´s dissatisfaction of increase in weekly price of a regular gasoline per gallon on the one hand and customer´s interest in hybrids and compact cars seeking fuel economy on the other. The report showed that the sales of small car are up 10.9% for the year while SUV sales are down by 16.2% and truck are down by 23.4%.
The U.SA. imports oil from different countries like Canada (20%), Mexico and Latin America (20%) and Middle East (15%).
The American population at a record is 300 million. The people of America worry about increasing trend of price level on gasoline which is badly affected to the American economy. Similarly, the high expenditure cost on Iraq war estimated $10 billion per month is dissatisfaction of the American people.
For over a decade, America imported price deflation primarily from China and India in the form of cheap labour, goods and services. Today that very same pool of cheap labor has earning power and new money to spend out. There are 2.4 billion people combined from China and India together, which is eight times the U.S.population.
Since May 2007 world market price undesirably increased. In accordance with the Time Magazine, market price went up dramatically as Oil-up 89%, Dairy –up 24% and Meat – 12%, Cereals – up 89%, Oils and Fats – 77% and Sugar – up 40%.
The recent Consumer Price Index report of April shows that inflation was running at 3.94 % down from 3.98% in March in the U.S.A. It is certainly high and higher than the Fed´s target rate of 2.2 % estimated.
The Energy Information Administration stated that the U.S.oil demand during the first half of 2008 fell down by an average 800,000 barrels per day compared with the same period a year ago - probably the biggest drop in 26 years.
Until recently, the American economy remains no worse condition, nor non-recovery. It can be as strong as the previous position. The main thing is that the general people are being suffered more in terms of income and employment and inflation on the one side and budget cutting in public welfare administration and care on the other.
Now is the time to think and rethink to develop America better after better until to set a sustainable system and practice on oil or fuel economy in the nation and world. The new thought for oil economy for stability in oil prices and its impact to the American economy as well as global economy is as challenges and opportunities to cure – a chronic economic pain to the U.S. economy. In other words, it is indeed crisis in the U.S.economy as well as world economy as a whole.
In order to solve this problem in the US economy and global economy, Dr Pradhanang who is the eminent economist and Father of Village Tourism of Nepal propounded the new thought - ´The Theory of Common Factor Denotation´
The economist of Nepal, Dr Pradhanang opines, "When the common factor turning into economic factor on goods and services holds the new weight in cost, the price of each commodity tends to increase and harms in the stability of price level – lead to inflation or inflationary pressure. In such circumstances, fixing oil prices at any rate in an agreed stagnation for a periodical duration of time can be a positive check or a principle for growth of oil economy to the U.S.economy as well as global economy which gets a chance to go back to the normal position as a remedial process to the economy as a whole. Then the chain economy instantly in terms of opportunity cost can be worked in progress by multiplying cells as a relief in the national economy."
"Most elaborately, the common factor denoting goods and services - oil price level should not be increased for the period of a specific time e.g. 10 years. Resultantly, the inflationary pressure will come down and the rescue operation will be taken place. Then the opportunities entering or creating into the several microeconomics based activities will be run and gradually expanded if other factors are remaining same or favorable."
There will be a relief in economy showing a sustainable exercise which would cut down inflationary pressure or assist for downturn in inflation by 40 % - 50 % to the causes of inflation in the economy.
To achieve this principle or theory, the following minimum conditions have to be considered as basic ground for normalization of economy:
1. Gasoline as international goods and services acceptable to all nations of the world for common welfare.
2. Need of international common agreement or treaty on the ground of globalization - expansion of global trade and industry and the search of global welfare economy of each nation – developed or developing.
3. The oil exporting countries – especially OPEC Nations should voluntarily agree for fixation of oil prices for the specific duration of time at least 10 years interval as their best contribution to the world population.
4. In lieu of consideration of fixation of price for the specific period of time, the International Community must agree to honor oil exporting countries - OPEC Nations as ´Good Nations for Good World Creation Economy´.
5. A special recognition and honor to the oil exporting countries should be marked at the top of the world economics index. Those nations which are specifically noted as ´Positive Economic Contributor For World Economy´ are provisionally graded to best for world.
6. The common principle sets as one world as brotherhood with loves one to other for uprising from micro and macro economy to global economy.
7. Oil enriched nations gifted by the nature must be obliged and oil as international property should be protected and guaranteed by the world community for their safety, respect and significance.
This is thought for national interest and international benefit. The people and government of the United States of America urge to pay attention to eliminate the economic pain through this proposed idea. This is on one hand a difficult task for implication and a simple way or suggestive measure for upgrading the U.S. economy and global economy on the other.
Possibly, this job can be done under the leadership of the U.S. Every nation should assist to the U.S.in this goal.