Traffic on La Cienega Boulevard passes operating crude oil pumps at the Inglewood Oil Field in Los Angeles County. (AP Photo/Reed Saxon)
If you ask an average American to explain just how we managed to get ourselves into this economic mess, he will most likely tell a fairly simple story. People borrowed too much, housing prices got out of hand, Wall Street went nuts, and eventually it all came down with a crash, leaving us in the worst downturn since the Great Depression. What will almost certainly be left out of the account is what was the biggest economic story of 2008, right up until Lehman Brothers went under -- a doubling in the price of a barrel of oil, and the resulting pain at the gas pump. Hard to imagine that the most significant oil shock since the 1970s has been relegated to historical sideshow, but these are the times in which we find ourselves.
The Kimball train station in Chicago.(Image used under a Creative Commons license from Flickr user Zesmerelda)
The American public is currently focused like a laser on the nation's economic struggles, to the exclusion of all else. That's perfectly understandable; livelihoods are at stake, and the situation is grim. But behind this economic crisis lurks the continued threat posed by global climate change. Eight years of delay has made the situation urgent, and while public opinion clearly indicates that economic recovery should come first, any opportunity to address both problems at once -- to both support the economy while reducing emissions growth -- must be seized.
I just wanted to say thanks to Ezra for having me here this week, and thanks to you, readers, for your insightful comments. If you haven't tired of reading about the economy, and stimulus, and the need to make sound infrastructure investments, you can find me at my home site, at The Economist's Free Exchange, at Grist, where I write a bi-weekly column on transit issues (cleverly called The Transit Authority), and for the next week, over at Matt's place. It would seem that this is the time of the year progressive bloggers take a break.
Back in December, the Onion headlined a story, "U.S. Economy Continues Campaigning For Barack Obama." This popped into my head as I read through the morning's GDP announcement, wondering whether Republican representatives were anxious to get back home and tout their stimulus "victory." I'd suggest that maybe, deep down inside, some of those legislators are feeling nervous, and perhaps chastened, but more likely they're waiting for the first round of such statistical releases in the wake of the stimulus, when they'll do their best to label any negative reading a failure of the president's stimulus plan.
So, plug time. In addition to blogging at ryanavent.com, I'm one of the brains behind The Economist's economics blog, Free Exchange. This week, the blog is hosting a discussion among economists on IMF economist Olivier Blanchard's suggestion that pervasive uncertainty is at the root of the crisis (check it all out here).
Tyler Cowen is one of the participants. He writes: