In response to the nearly self-fulfilling prophecy of a recession, President Bush recently announced proposals to offer tax rebates in the ballpark of $150 billion. He also proposed a kick-in for industry to help support production, all in the name of boosting a rapidly sagging economy. There’s just one problem with his intentions — they won’t work.

The biggest variable is the price of oil. It depresses the value of the dollar worldwide, it crushes the budgets of millions of American households, and there isn’t a damn thing we can do about it. With the tables shifting in world economics and China booming with industry, if we had the ability right now to reject Middle Eastern oil outright, the effect on the price per barrel is presumed by most analysts to be negligible.

This, of course, is the pebble at the center of the massive snowball. Those American households I mentioned are dealing with a lot — subprime mortgages, credit crises, foreclosure, unemployment, and the winter cold that doesn’t care about the price of oil or the size of your home or how far you have to drive to an underpaying job. (more…)