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Unformatted text preview: and Beijing com pete for oil s tocks . Moreover, beneath the s urface of the US econom y, all is not
well. Growth looks healthy enough, but the com petition from China and els ewhere has m eant the world's
bigges t econom y now im ports far m ore than it exports . The US is living beyond its m eans , but in this tim e of
s tudied com placency a current account deficit worth 6 percent of gros s dom es tic product is s een as a s ign of
s trength, not weaknes s . In this new Edwardian s um m er, com fort is taken from the fact that dearer oil has not
had the s avage inflationary cons equences of 1973-74, when a fourfold increas e in the cos t of crude brought an
abrupt end to a pos twar boom that had gone on uninterrupted for a quarter of a century. True, the cos t of living
has been affected by higher trans port cos ts , but we are talking of inflation at 2.3 per cent and not 27 per cent. Yet
the idea that higher oil prices are of little cons equence is fanciful. If people are paying m ore to fill up their cars it
leaves them with les s to s pend on everything els e, but the...
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This document was uploaded on 03/23/2014.
- Summer '14