According to free market theory, people considering their own best interest will make the best long-term economic decisions. This can be the case.
However, our nation has a history of having economic elites make decisions based on attaining immediate profit and ignoring our national long-term best interests. One example of this is using up resources and simply searching for more elsewhere when we run out.
When the Southern colonies were founded, it was discovered that wheat grew well in the region, though tobacco and cotton were much more profitable. These crops were also much more damaging to the soil. Instead of growing wheat or practicing crop rotation to preserve the soil, many colonists grew tobacco or cotton for the greater short-term profit.
Contrary to free market theory, colonists didn't consider their long-term best interest. Instead, they grew crops for immediate profits and left the land and slavery problem for their children to worry about. Their children, for their part, supported Indian removal to deal with the lack of land. With the lands along the coast depleted, planters pressured to have the Indians removed from their fertile lands.
We no longer have an economy based primarily on agriculture. Today, our economy is based on oil. The standard of living that comes along with living in the industrialized world is created by translating oil into work and products.
We use oil to get to and from work. We use oil to run the machines that grow our food. We convert oil into fertilizer so we can keep growing crops on the same fields. We use oil to make plastics of which nearly everything from computers to TVs are made.
Oil has allowed the great population growth this planet has seen. When oil prices go up, so does the cost of production. When oil prices go up, our economy stagnates.
Is it safe relying on one resource so heavily? Conventional wisdom states never put all your eggs in one basket. The Plains Indians developed a way of life solely around the buffalo. They used the buffalo for their clothes, homes, food and source of fire. As the herds were depleted, they searched for new herds, more fertile plains.
Euro-Americans decided they wanted buffalo too and they began hunting them as well. Competition for buffalo eventually led to shortages. Without the buffalo, the Plains Indians could not maintain their way of life.
Oil prices will go up as a function of supply and demand. We are competing with the economies of China, India and the rest of the world. Their demand for oil grows along with their populations and economies. Even as we find and drill new oil fields around the world, demand and cost will continue to rise.
Just as the Plains Indians searched for new herds of buffalo we can search for new oil fields, but that's not a sound long-term plan. The oil we find will never be enough. The U.S. produces around 5.1 million barrels of oil a day and consumes 20 million.
Let's assume we doubled production, which isn't possible, we still couldn't meet our needs. Also, all the oil that we produce is sold on the international market where it goes into one big pool. The price of oil itself is based on how much oil there is on the whole market.
Presently there are around 84 million barrels produced per day. If we doubled production, which isn't possible, that would only add another 5 million barrels, hardly enough to affect price.
We are in economic competition with the rest of the world. How we react to this problem may well decide our economic future. We can either look for ways to transport ourselves and our goods, and grow our food using little to no oil, or we can naively hope our version of the buffalo never runs out.
The U.S. consumes 140 billion gallons of gasoline per year. How might our economy be helped if we cut that in half and spent the rest of the money on local goods and services? As a nation do we favor adaptation and advancement or stagnation and decline?
Brandon Givens is a Gainesville resident whose columns appear frequently and on gainesvilletimes.com.