In an attempt to steal away votes from the slowly approaching Senator Clinton, Barack Obama was toting around West Virginia on Thursday, delivering yet another riveting speech to the constituents. Just another day of Presidential Politickin’, right? However, something was different about Thursday’s speech in West Virgina. The typical “hope and change”, “change and hope” stump speech was set aside for a more direct speech on ((gasp)) the issues! This is a stark contrast from the standard speech that has captivated audiences all over the country, swooning them into pledging their vote to the now rockstar presidential candidate. So, to stray away from something that works, one would assume he had better have a darn good reason, and be spot on with his facts, right? Well…not so much.

One of the main points of Obama’s West Virginia speech on Thursday was to tug on the emotional strings of the constituents’ wallets, instead of their hearts. He drew a link to the Iraq war and increased oil prices, saying, “When you’re spending over $50 to fill up your car because the price of oil is four times what it was before Iraq, you’re paying a price for this war.” He went on to blame the war for increased oil prices and the steeply increasing debt. Maybe he should stick to “change and hope”, because he can’t seem to get his facts straight. Either that, or this speech shows a severe misunderstanding of basic economics by Obama.

It is no secret that the Iraq war has been costly. According to an estimate by CostofWar.com, the price is now over $500 billion dollars and rising. Thats a lot of money. In his speech, Obama pointed out that at that cost, the government could have instead been giving out healthcare, hiring teachers, and making college more affordable. Well, last week the Federal Reserve Board injected $200 billion into the credit market alone. When they helped JPMorgan Chase bail out Bear Stearns this week, they guaranteed $30 billion of their assets. So in two weeks alone, $230 billion has gone into the still failing credit market. Actually, since August, the Fed has injected almost $1 TRILLION, yes TRILLION dollars into the credit market. What have we got out of it? The market is much worse than in August, and shows no signs of improvement. That makes the war look like quite a bargain!

In April 2007, Obama voted “Yes” for a $104 billion appropriations bill for the War in Iraq, and “Yes” in November 2007 for another $50 billion. Since then, he hasn’t voted on any bills related to the non-funding of the war. He was absent for a bill that would set the budget for the next fiscal year for the war and was absent from a vote for troop withdrawl. So since the last time he voted on anything for the war, he has never voted to NOT fund the war. How can Obama claim the government can do better with the money they are spending on the war, when he himself has yet to vote against funding for it? The $154 billion in 2007 alone that Obama ok’ed could have gone towards that healthcare, jobs and college funds he was preaching about.

Obama also claimed that the war has lead to the huge increase in gas prices we are all suffering from. A simple understanding of Econ 101 can answer this. There are 3 main reasons why prices fluxuate for any product: Changes in supply and demand, currency fluxuations, and speculation. Supply has remained fairly constant, while demand has been steady, if not slightly declining in very recent news. With both mainly steady, price changes based on the other factors of currency fluxuations and speculation. As seen in any graph on the subject, the price of oil has increased at a very similar rate that the dollar has decreased, however it is NOT 4 times more expensive, according to Obama. When you have to spend more money for the same amount of a commodity, the price shoots up. To put it simply, lets say you can get a barrel of oil for $10. Now all of a sudden, your dollar declines 10%, thus negatively effecting both parties. The seller will have to increase his price because the dollars he used to purchase it did not go as far as before, and the buyer will have to use more of their dollar to buy the oil. Now the barrel is $11. Seeing the point here? When the currency being used to purchase the oil is worth less, more it must be used to maintain the volume of oil being purchased. A little further research shows the price of gold steadily increasing at a very similar rate to the price of oil. Were that our currency, we would still be facing a price increase of oil, but our currency would be appreciating at the same rate, so we would not feel the effects of the difference. With our economy on the verge of a recession, speculation is not good for oil providers because they are unsure if our demand will remain at its current levels, thus driving prices artificially higher.

So, Obama should make sure he has his facts straight before straying from his “hope and change” stump speech, or his race accusations. This should be an eye opener to the public that he may not know what he is talking about, since it is one of the first times we’ve seen him try to get into the details of an issue. For economic insight and truth, there is only one candidate still in the race who can break down the why’s and how’s of skyrocketing oil prices, the credit market and our declining dollar: Ron Paul. Slowly but surely his economic discussions have started to filter into the mainstream topics of conversation. Only time will tell when people begin to question exactly WHY oil prices are shooting up and all of our goods and commodities are seemingly more expensive, and hopefully we won’t turn to speeches for answers from candidates who have no sound basis to their claims. Obama, please do some research before you go stirring up people on false facts. Just a thought…

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