Katrina goes international
■"Ad-Libbing Many Routes, Ships Return To the River," by Jeff Bailey, Alexei Barrionuevo and Charles V. Bagli, New York Times, 7 September 2005, p. B1.■"Economic Impact Is Being Felt Around the Globe: Likely Slowing of Growth, Employment in U.S. Is Seen Pressuring Other Economies," by Patrick Barta, Marcus Walker and Jon E. Hilsenrath, Wall Street Journal, 7 September 2005, p. A8.
■"Gas Prices At Pumps Show Signs of Easing: Calls for inquiries into what some see as profiteering," by Vikas Bajaj and Jad Mouawad, New York Times, 7 September 2005, p. B1.
■"In Asia, Low Fuel Prices And Subsidies Lose Ground," by Keith Bradsher, New York Times, 7 September 2005, p. C5.
■"Toyota Hopes to Push Its Hybrids Beyond the Niche," by James Brooke, New York Times, 7 September 2005, p. B1.
America's transportation system is recovering through its innate genius for workarounds. As the most comprehensively horizontal economy in the world, this is who we are.
And yet the ripples of even this relatively short slow-down in flow is being felt around the planet-meaning the rest of the Core (the Gap not being connected enough to feel pain yet).
Of course, the country that would suffer the steepest and most immediate decline in any U.S. collapse would be . . . China, so sayeth famous Morgan Stanley bear Stephen Roach ("China would be on the leading edge.").
How's this for a weird twist: China's government forces oil companies there to sell at fixed prices domestically, so when something like Katrina sends prices higher, these Chinese companies will divert supplies abroad to make a bigger killing, thus leading to gas shortages at home.
Oh yeah, the Chinese Communist Party is running that economy all right.
If anything, all these sustained high prices are pushing governments throughout Asia to rethink and start abandoning their long-term subsidies for energy consumption there, a policy that's left many Asian economies several-fold less efficient than Old Core economies. China, according to the Asian Development Bank, uses five times as much energy as Japan in creating the same amount of GDP.
So guess where Toyota's gonna strike it rich with hybrids and later hydrogen cars? Think it'll occur in America first, where we've successfully insulated our economy from rising energy prices to the point where Katrina is a storm easily weathered? Not likely, as we're already too efficient for our own good-compared to New Core pillars on the upswing. I mean, if China's choice is conquer the Middle East or get a whole lot more efficient, guess which sounds smarter and more profitable over the long haul?
Mark my words, the first H-car I buy will be a Honda (my preferred Asian brand) built in China.