Dave Hodges

More About: Conspiracies

One Oily Hand Washes the Other Oily Hand: Do We Dare Use the “F” Word?

Many academic scholars view Fascism as a kind of corporatism in which the interests of corporations and government become one in the same. After reading the following account, Americans will inevitably seek to find a label to adequately describe the following practices described in this article. Is the F word (i.e., fascism) to strong of a term in which to label the following events?

The Arizona senatorial race is a microcosm for political races across the country. If the elections would have been held in July, most political big oil supporters (e.g., Arizona Republican Senator Jon Kyl) would have been swept away by an avalanche of angry, gas-gouged, American voters. For example, Kyl sponsored a 6.5 billion dollar tax break which benefited Exxon at the same time he was an Exxon stock holder. During this election cycle, Kyl has accepted campaign donations to the tune of a quarter of a million dollars from the oil companies in a clear case of one oily hand washing the other oily hand. Fortunately for Kyl and other politicians with the same oil company allegiances, the last two months have witnessed a welcome relief to the record gasoline prices which had previously accompanied record oil company profits. Many pundits have speculated that the price of gas was being artificially manipulated in order to influence the vote of many Americans who have short term memory problems.

The notion that massive numbers of oil suppliers, gasoline distributors, gas station owners and even the Arabs, were convinced by Republican incumbents to lower the price of gas in order that oil-friendly politicians, like Arizona Senator John Kyl, could get re-elected and that their undying allegiance to big oil would be erased from the public consciousness by dramatically falling oil prices. It is true that Americans have very short memories when it comes to politicians. And it is also true that the price of gasoline is plummeting in the months leading up to the 2006 elections. Although this is a very interesting theory, it is highly unlikely because it would involve the impractical, secretive and joint complicity of a cast of tens of thousands of co-conspirators.

Although the aforementioned conspiracy theory behind falling oil prices is probably wrong, the notion that oil prices are being artificially manipulated in order to strongly influence the re-election of oil friendly politicians is provably accurate.

The NASDAQ stock index is the most important benchmark of the mighty 1990's tech bull market. In a similar fashion, over the last several years, the Goldman Sachs Commodities Index (GSCI) has become the choice reference measure for today's powerful commodities market.

Like all financial indexes, the GSCI is not a fixed measuring instrument as it is constantly evolving. Decades of component choice, weightings, and calculation methodologies gradually change as the index guardians, such as Goldman Sachs, strive to keep their index relevant and useful. Fortunes are made and lost with these index changes. And now we know that the Republican powers-that-be are trying to control the outcome of the upcoming midterm 2006 elections through the manipulation of the commodities market which has significantly lowered the price of gasoline at the pump. And Goldman Sachs is all too happy to oblige in order to further a dramatic political appointment of one of its own.

From July to October of 2006, commodity funds have been liquidating commodity holdings. Amazingly, the GSCI, one of the most popular vehicles for gauging the price of raw materials, has been dramatically altered by cutting its exposure to unleaded gasoline. Prior to Goldman's revision of the GSCI in July of 2006, unleaded gas accounted for 8.45% of the GSCI and Americans were paying over $3 for a gallon of unleaded gasoline. Now, unleaded gas is only 2.30% of the GSCI. This means that commodity funds had to sell 73% of their gasoline futures or hard commodities in order to conform to the reformulated GSCI. This forced investors, who track the index, into a must-change strategy which involved altering their portfolios accordingly. This led to a plethora of unleaded gasoline futures flooding the market which sent unleaded gasoline commodities prices, and ultimately gasoline pump prices tumbling dramatically downward. To the average investor, this would appear to be the simple ebb and flow of the market. Yet, a closer examination reveals an undeniable connection between the former CEO of Goldman Sachs, Henry Paulson, and President George W. Bush's desire to artificially lower gas prices in an undeniable attempt to alter the 2006 election results in favor of such oil company favorites like fellow Republican Jon Kyl.

Goldman Sachs' CEO, Henry Paulson, was appointed by Republican President, George W. Bush and was confirmed on July 10, 2006 to be the current Secretary of the Treasury. This same month witnessed a huge decline in the unleaded gasoline commodities market and subsequently at the gas pump. Is this just a coincidence? Or, is this a case of trading a prestigious political appointment in exchange for a dramatic political favor? After all, Paulson, as CEO of Goldman Sachs, is the very person who was in a position to ultimately and directly impact the GSCI and ultimately influence the price of gasoline. And in the same month of the dramatic GSCI change, Paulson accepted an appointment to become the nation's 75th Secretary of the Treasury. Of course, President Bush and his band of fellow oily Republicans would have America believe that these two events bear no relationship to each other and are merely coincidental.

Certainly, if the unleaded gasoline market can be manipulated downward in a well-disguised effort to lessen the anger of the voting public towards "oily politicians", it can also be manipulated in the other direction as well. Come January of 2007 and oil friendly politicians, like Kyl, are once again seated, what do you suppose will happen to the commodities market and ultimately the price Americans are paying at the pump?

Only 3 short months will separate Arizona's voters and the specter of paying $3+ per gallon at the pump and the 2006 elections. Do Arizona's voters suffer from short-term memory loss or are they just gullible? The November election results will go a long way towards answering this question. Any State which re-elects a politician, like Jon Kyl, deserves what they get at the gas pump.

The lines of distinction are so blurred that it is impossible to tell where the interests of Goldman Sachs, Treasury Secretary Paulson, President Bush and the oil industry begin and end. Subsequently, there are more important issues than whether the indentured oil servant, Jon Kyl, is re-elected to his senate seat. There is no question that Wall Street and the executive branch of the government conspired to commit a fascist-like act by manipulating the price of gasoline in the weeks leading up the 2006 elections. Therefore, a larger and much more significant point centers on the question that is being posed by famed movie producer Aaron Russo: Is Russo correct when he unashamedly states that we have gone from a nation of freedoms to a nation dominated by the increasing presence of fascism? The ultimate answer to this question will have far-reaching effects with regard to the survival of our Republic and its traditions.

I sincerely hope that Russo is in error. But what if he is not?

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