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Two weeks ago, the Iranians allegedly bombed Saudi oil facilities and put a big chunk of that country’s oil production offline. Also two weeks ago, the UAW went on strike against GM, our country’s largest auto manufacturer.
When I was growing up in the 60s and 70s, similar disruptions would have rocked our economy and been the dominant news stories for weeks. Check out this news clip from 1979 when the Middle East crisis de rigueur caused a gas shortage and New York State instituted odd-even gas rationing.
There were no 24/7 gas stations back then, so we would park the family car at the gas station queue the night before our designated gas-pump day. Then we would return to our car in the mourning just before the gas station opened. What fun!
But today, the Saudi oil attack and the GM strike were duly noted by our media and quickly supplanted by more pressing or titillating concerns. Our nation, in effect, collectively yawned.
And there’s a good reason why we collectively yawned: Middle East oil and GM cars just don’t matter as much as they used to. Consider the following:
- In 1977, we got 70 percent of our oil imports from OPEC. Today, we get a little over 30 percent. Saudi Arabia isn’t even close to being our largest supplier of imported oil. We currently get 43 percent of our imported oil from Canada. The Saudis supply nine percent of our imported oil.
- In 1979, the year I graduated high school, GM accounted for 45 percent of the U.S. auto sales. Today, GM accounts for 17 percent. In 1970, the last time the UAW struck against GM, 343,000 UAW workers refused to man the assembly lines. Today, 46,000 UAW workers are refusing to man the assembly lines.
The Personal Finance Angle
The world isn’t static. Human ingenuity can’t be bottled up by lobbyists and legislatures. In the 60s and 70s, few people at GM and the UAW appreciated the threat posed by Japanese carmakers. Up until a decade ago, few people in OPEC appreciated the threat posed by American hydraulic-frackers.
The personal finance angle regarding the above is clear. Disruption and obsolescence are a never-ending fact of the human condition. As such, you are best served with the following:
- Eliminate debt
- Have a healthy emergency fund
- Always be learning
Final Thoughts
Okay, groovy freedomist, that’s all I got. What say you? How does one stay safe and relevant in a dynamic world? Let me know what you think when you get a chance. Peace.
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