Jimmy Carter Bush

Steve Forbes

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Can it be true? A Republican president repudiating the anti-inflationary legacy of Ronald Reagan? That is precisely what George Bush is doing. Not deliberately, of course, but the result is the same. We're in for the most serious bout of inflation since the presidency of Jimmy Carter. And so far this President and his officials remain oblivious to the magnitude of what they are inadvertently bringing about.

The Treasury Department bureaucracy has long believed in a weak dollar as a means of redressing the supposed problems of our trade imbalance. These bureaucrat-economists ignore copious evidence on the destructiveness of currency devaluation. Debasing your money may increase exports and reduce imports, but only for a time. Eventually costs rise, thereby reducing corporate profits. Prices are readjusted.

Easy money also begets domestic economic distortions. Commercial and mortgage brokers behaved recklessly in 2005--06, but the Fed's creation of excess dollars made the binge far worse. Civil law has made it clear that bartenders are liable when they continue to serve inebriated customers. This, in effect, is what Alan Greenspan and Ben Bernanke should be because they kept dishing out excess money.

The surge in commodity prices is already having enormous repercussions, not only in the cost of products and services but also in political and social disruptions. Iran and Venezuela have hundreds of billions of dollars in windfalls with which to practice their malignant political mischief. Developing countries such as Mexico, Indonesia and Egypt are facing dangerous political crises as rising food costs hammer their none-too-prosperous populations. Strains with our allies are growing as their exporters are unfairly punished.

Here in the U.S. voter anger and anxiety will only grow. Expect increased labor unrest as higher prices eat away at the purchasing power of paychecks.

Only after the massive rejection of Republicans in the 2006 congressional elections did the Bush White House fundamentally alter its war strategy in Iraq. Perhaps a devastating flight from the dollar--the kind that precipitated the 1987 stock market crash--is needed to shake the White House out of its damaging weak-dollar rut.

Phony Problem

One reason the Fed is feeding inflation is that it thinks it's grappling with a conundrum: Inflation is rising, and the economy is weakening. How can our central bank stimulate the economy without risking even more inflation? Rotten ideas never seem to die. The Fed's notion that it must choose between economic growth and inflation is absolutely false. Experience has repeatedly shown that there is no tradeoff between inflation and a vigorous economy. We can have both excellent growth and a stable currency.

A couple of examples among many: The U.S. in the 1980s had the second-largest economic expansion in its history, yet inflation plummeted from 13% to 3%. The 1990s had the largest, with a long, energetic period of growth and little inflation. Switzerland repeatedly demonstrates that you can have the best of both worlds.

The Fed finds itself with an inflation crisis because of its own blunders, namely printing too much money in 2004--05 and again now. The Fed should mop up the excess liquidity--success with this would see gold, the best measure of monetary excess, drop from $900-plus an ounce to less than $500.

As for the credit crisis, the problem is not a lack of liquidity but fear. And that fear is deepened by the plunging dollar.

And instead of doling out useless rebates, Congress should make the 2003 tax cuts permanent and slash the business profits tax from 35% to 25% or less. That would get this economy roaring ahead.

Alas, both the Fed and Congress aren't capable, at least for now, of doing things so sensibly.

Preventable Turmoil

Did any of our diplomats or those from the european countries seriously consider a territorial adjustment of Kosovo's borders before the former autonomous Serbian province declared its independence? A piece of Kosovo is a Serbian enclave with a population of about 60,000, nearly all Serbs. It is not surprising that the area is now racked by violence. Extreme Kosovar nationalists hope to drive the Serbs out through intimidation. This naturally inflames already red-hot nationalist sentiments in Serbia and puts unbearable pressure on its pro-Western president, Boris Tadic, to aid eager-to-fight Serbian irregulars in Kosovo.

The sensible thing would have been to carve out that Serbian territory and cede it to Belgrade. (See Ralph Peters' excellent Feb. 19 New York Post column on this subject.) That would have been something of a face-saver for Serbia and its Russian patrons when Kosovo declared independence. The Kosovars would not have been happy, but an ugly source of conflict with their angry and much larger neighbor would have been avoided. A sullen peace would likely have ensued. Instead we have deadly conflict.

Perhaps it is not too late to bring about such a change. After all, NATO has thousands of troops in Kosovo, and the excision of that Serbian enclave could be done unilaterally. (Serbs living in other parts of Kosovo could move there.) Then Kosovo and Serbia could verbally shake their fists at each other while both go about the constructive business of reforming their economies to become part of the EU.

Graceful Giant Gone

When William F. Buckley Jr. launched National Review in 1955, he impishly declared that it "stands athwart history, yelling Stop." He didn't stop history, however; he made it. Few other figures have had the impact on their times that Bill Buckley had on his. Without him, the extraordinary resurgence and reformation of conservatism in American political and economic life that culminated in the presidency of Ronald Reagan would never have come to pass. The U.S. wouldn't be the mighty and vibrant colossus it is today but rather a pallid and stagnant version of western Europe.

Starting with his 1951 book, God and Man at Yale, in which he takes his alma mater to task for its growing hostility to religion and capitalism, Buckley was at the forefront of making conservatism a potent and dominating force in American life.

National Review was the vehicle for nurturing serious conservative writers and intellectuals at a time when liberalism was ascendant and conservatism was viewed as outdated, xenophobic and anti-Semitic. Under Buckley's leadership the xenophobic and anti-Semitic elements were effectively drummed out of mainstream conservatism, and it became the buoyant, optimistic movement personified by both Buckley and Ronald Reagan.

Buckley also embraced the medium of television. His show, Firing Line, vividly demonstrated the mass appeal of conservatism and the absurdities of liberalism. The program lasted 33 years, a real-world equivalent of centuries.

Buckley was an extraordinarily gifted individual with a stupendous wealth of knowledge. He was a brilliant debater, a magnificent essayist, an excellent novelist, a prolific writer of nonfiction, a first-rate sailor and a legendary wit. One of my favorite Buckley quips: A guest on Firing Line in the mid-1960s pointed out that Robert Kennedy, a liberal icon, was a Buckleyesque conservative as a young man and then turned to the left politically. Without missing a beat, Buckley said, "He peaked early." Another: When Buckley was running for mayor of New York City in 1965, he was asked what he'd do if he won. "Demand a recount," he famously replied. He even learned to play-- and mastered--the harpsichord.

Of course, there have been plenty of other men with considerable talents, but Buckley focused his in a way that profoundly changed the world for the better. Bill Buckley will live in memory as long as liberty lives--which, thanks to him, should be a long time indeed.

Reading Well Is Best Revenge

Stone Cold--by David Baldacci (Grand Central Publishing, $26.99). Revenge is a powerful motivator, and as a dominant theme here it makes for an enthralling thriller as Baldacci seamlessly weaves in several plots. The book revolves around the Camel Club and its head, a onetime CIA assassin, John Carr, alias Oliver Stone, whom most people believe to be dead. The handful of other club members are skilled and adventuresome middle-aged eccentrics.

Annabelle Conroy, an honorary club member as well as a superb con artist, has stolen $40 million from a psychopathic casino owner because years ago he'd killed her mother. The psychopath brings his lethally warped gifts to bear in hunting Annabelle down, torturing her partner in the scheme to the point of being brain-dead. Enter the Camel Club to help out Annabelle.

At the same time, a former Navy Seal who is doing contract work with Homeland Security and the Pentagon is systematically killing retired members of Oliver Stone's former CIA unit. This guy is another evil genius at his craft. Enriching this murderous stew is a former CIA director who has his own deep, lethal secrets, as well as a U.S. senator who is also a former spook and wants to be President.

Reading Baldacci is like listening to a flawlessly performed symphony.

The Fed's Intervention around the world

Australian

• In an editorial, the paper welcomes Prime Minister Kevin Rudd’s goodwill towards Israel, and says it supports all efforts for a two-state solution that includes self-determination for Palestine and brings lasting peace to a much-troubled region.

Daily Telegraph

• In an editorial the Telegraph welcomes the intervention on Tuesday by the Federal Reserve and other central banks into the money markets but expresses concern for the future, saying that if there are more horrors to come, the Fed and the other central banks cannot have many more shots left in their locker.

Dawn (Pakistan)

• In an editorial on Tuesday’s bomb attacks in Lahore, the paper writes that President Musharraf’s anti-terror policies are increasingly seen as being aimed at securing the West against terror while the people of Pakistan are becoming more exposed to the most horrifying of all horrors.

Financial Times

• In an editorial on the Federal Reserve’s intervention, the FT says the Fed is right to try but says its latest action is unlikely to have much effect.
• Columnist Martin Wolf writes that we must pray that the Fed can clean it all up, without excessive collateral damage. Unfortunately, he says, such prayers often go unanswered.
• Benjamin Schreer of the German Institute for International and Security Affairs and Asle Toje of the Norwegian Institute for Defence Studies comment on the security risks to both NATO in Afghanistan and by extension to the European Union.
• Rodric Braithwaite, a former British ambassador to Moscow, pleads for Russia to be allowed to find its own path to democracy in the wake of the election of Dimitry Medvedev.

Guardian

• In an editorial the paper comments that the French president, Nicholas Sarkozy, is in trouble after a shift to the left in municipal elections on Sunday. Mr. Sarkozy, the Guardian says, has promised that he will listen to the French people. The question is whether he has the humility to do so.
• Columnist Jonathan Freedland, writing on the Middle East, says that to rescue the two state solution, Israel must make peace with Syria.

Independent (London)

• Stephen Hale of the Green Alliance looks ahead to a summit of European leaders on Thursday, saying that it is in Europe that British politicians can take decisions that can avert disaster on climate change.
• In an editorial on Darfur, the Independent says the international community must act with resolution to stay the hands of Khartoum and to stop the violence against civilians.

International Herald Tribune

• CFR fellow Charles D. Ferguson and research associate Michelle M. Smith write on the IHT's op-ed page that fears over France's nuclear diplomacy in the Middle East are overblown. The practical barriers to nuclear energy, or weapons, are too high, they say.

Jordan Times

• In an editorial, the paper criticises both Israel and the United States Secretary of State, Condoleezza Rice, over Israel’s plans to build hundreds of new houses on a West Bank settlement.

Moscow Times

• Martin Gilman of the Higher School of Economics in Moscow warns that Russia’s size does not insulate it from the financial turbulence that is increasingly seizing up the world economy.

New York Times

• In an editorial, the Times comments on forthcoming elections in Serbia, and says the Democratic Party of President Boris Tadic offers the most sensible policy, favoring moving quickly to qualify Serbia for membership in the European Union, which, the paper says, is an economic necessity.

Times of India

• In an editorial on Tuesday’s bomb attacks in the Pakistani city of Lahore, the Times says Washington and its allies should help moderate parties to get their act together and form a government that can take on terror. Depending on the army for stabilizing Pakistan has not worked, it concludes.

Times of London

• Bernard Kouchner and Carl Bildt, the foreign ministers of France and Sweden, write in favor of Serbian membership of the European Union, saying they want Serbia to be given official EU candidate country status as soon as possible.

Wall Street Journal

• In an editorial on the resignation on Tuesday of Admiral William Fallon as CENTCOM Commander, the paper says his departure will be especially good news if it means that President Bush is beginning to pay attention to the internal Pentagon dispute over Iraq.
• In a further editorial, on Tuesday’s intervention by the Federal Reserve, the Journal says the move continued what it has argued is the Fed's best policy course in this crisis, which is to serve as a facilitator of markets frozen by uncertainty.
• In an editorial on China’s response to recent reported terrorist incidents, the paper asks whether, given China's opaque and unaccountable justice system, this weekend's roundups were crackdowns on violent militants or just more cases where the government uses the fear of terrorism to justify arresting peaceful dissidents.
• Jesper Koll, an investment expert, commenting on the rejection on Tuesday by the Japanese opposition of the government’s candidate for central bank governor, says the prime minister should not be swayed from his choice.

Washington Post

• The Secretary-General of the United Nations, Ban Ki-moon, calls for an effective and urgent response to the threat of hunger and malnutrition caused by soaring global food prices.
• Op-ed columnist Robert J. Samuelson, writing on OPEC, says that the organisation may be the real deal: a cartel that works. If so, he says, that's bad news for the rest of the world.
• Council on Foreign Relations fellow Michael Gerson writes in praise of legislation introduced by Tom Lantos and Henry Hyde on combating AIDS in Africa.
• In an editorial on the crisis in Zimbabwe, where an election is due this month, the Post calls on South Africa and its neighbors to pressure the president, Robert Mugabe to hold a fair election -- and to step down if he does not.

Washington Times

• In an editorial on the easing of tensions between Colombia, Ecuador and Venezuela, the Times says there are several lessons here for the Western Hemisphere.
• Paul Belien of the Hudson Institute, writing on the presidency of Nicholas Sarkozy, says that in less than a year, Mr. Sarkozy has managed to lose the respect of his compatriots and turn the French presidency into an international laughing stock.
• Columnist Harlan Ullman writes from Pakistan that the United States may have far more to learn from Pakistan than it from us about governing, the necessity for genuine political compromise, and winning the global war on terror.

Stocks Soar on Fed's Liquidity Move

The financial sector moved from the stock market's caboose to its first-class dining car, leading a frenetic stock rally Tuesday after the Federal Reserve announced its latest effort to end the freeze-up in Wall Street's credit markets.

QUESTION OF THE DAY

Where will the stock market be three months from now? Cast your vote.

The Dow Jones Industrial Average skyrocketed 416.66 points to 12156.81, up 3.5%, its biggest one-day percentage gain in nearly five years. The Dow's gains accelerated toward the end of the session., trimming the average's year-to-date decline to 8.4%. Twenty-nine of the Dow's 30 blue-chip components posted gains, including jumps of more than 9% each in Citigroup and American Express.

The technology-focused Nasdaq Composite Index was up 4%, or 86.42 points, at 2255.76, off 15% this year. The Standard & Poor's 500 surged by 3.7%, or 47.28 points, to 1320.65, down 10% this year. All the broad measure's sectors posted gains, led by a 7% gain for the S&P's financial components as a group.

WL Ross & Co.'s Wilbur Ross discusses whether the Federal Reserve's newest move is a sign of weakness. He talks with WSJ's Dennis Berman.

The Fed announced Tuesday it would ramp up loans of cash and securities to banks and dealers. The new program will let firms borrow up to $200 billion of Treasurys and pledge various flavors of mortgage-backed securities, including both agency and private-label instruments, as collateral.

Markets for mortgage securities had been rapidly deteriorating recently as investors facing margin calls and others anxious about the overall financial health of government-sponsored enterprises Fannie Mae and Freddie Mac sold their holdings. The developments alarmed investors and policy makers and led to selling of financial stocks in recent days.

Some of that angst eased on Tuesday. Prices for agency mortgage bonds, or securities backed by home loans guaranteed by Freddie or Fannie, rose after the announcement, causing yields to fall. The difference between interest rates on agency bonds backed by 30-year mortgages and yields on five-year Treasury bonds slipped to 3.22 percentage points, down from 3.36 percentage points on Monday, according to data from Bear Stearns. Last week, that spread soared to a record of over 3.5 percentage points. It was 2.48 percentage points just over a month ago.

As a rule of thumb, narrower spreads are an indication that investors see agency debt as a low-risk investment.

Shares of Fannie and Freddie, which had been pummeled by investors of late, rebounded. Freddie advanced by 12.6% and Fannie climbed 9.4%. But shares of each firm remain about 70% below their 52-week highs set last spring, a stark reminder of how hard the financial crisis has hit Wall Street as a whole.

Real-estate investment trusts that invest heavily in mortgages backed by Fannie Mae and Freddie Mac rallied Tuesday. Capstead Mortgage jumped 24.2% and Annaly Capital Management gained 9.3%. The shares of those companies were beaten down last week as the agency-debt market shuddered.

Mortgage lenders' shares likewise soared. Countrywide Financial and IndyMac Bancorp rose by 17% and 23%, respectively. Washington Mutual jumped 18%. Shares of Thornburg Mortgage, which struggled to meet margin calls last week, more than doubled.

Fannie and Freddie are traditionally seen as relatively safe bets because they are congressionally chartered. Many investors interpret that as an implicit guarantee that the government won't let the two lenders fail, a perception that officials typically try to tamp down. Last week, a Treasury spokeswoman had denied rumors that the government would soon make an explicit guarantee of Fannie and Freddie debt.

"The Treasury told the truth," said Ed Yardeni, chief investment strategist at Yardeni Research. "They didn't bail out Fannie and Freddie. In effect, the Fed just did instead."

Despite Tuesday's euphoric market reaction to the Fed move, veteran investors hesitated to interpret the gains as the start of a longer rally. Instead, many said there could be more bumps this year before corporate profits rebound, financial firms' books are cleaned up for good, and the U.S. economy is on sure footing.

"I think we could get a pretty good tradeable rally here, but I sure would not expect this to be the end of the decline," said strategist Bob Phipps, of CACH Capital Management in Austin, Tex. "This is not how bear markets end."

Kitco gold analyst Jon Nadler discusses the precious metal's recent rise and whether the market is due for a correction. MarketWatch's Polya Lesova reports.

Analysts don't expect the Fed's move to be a salve for the earnings of banks and Wall Street brokerages. Major Wall Street investment houses will start to report first-quarter earnings next week, and are generally expected to take more write-downs on the value of soured mortgage investments.

Mike Thompson, research director at Thomson Financial, said analysts expect aggregate earnings for the S&P 500's components to be down more than 4%, including a plunge of more than 37% in financial-sector earnings. "What we saw today from the Fed was helpful, but things are still going to get worse before they get better in the financial sector," Mr. Thompson said.

The Fed's move boosted the dollar versus the yen and sent long-dated bonds sharply lower.

Among other stocks in the news, WellPoint fell 28.3% after the health insurer cut its 2008 earnings outlook, saying the first two months of the year were worse than expected despite previous planning for an economic downturn. And Texas Instruments fell 3% after lowering its first-quarter earnings estimates.

In other major market action:

Commodities rose. The broad Dow Jones-AIG Commodity Index gained 0.5%, or 1.131 points, at 216.338. Crude-oil futures rose 85 cents, or 0.8%, to $108.75 a barrel, up 13% this year. Contracts on heating oil and reformulated also hit records. Gold futures rose $4.30, or 0.4%, to $974.20 per ounce in New York.

Bonds fell. The two-year Treasury fell 17/32, yielding 1.733%. The 10-year note fell 1-10/32 to yield 3.596%. The 30-year bond fell 1-11/32 to yield 4.530%.

The dollar was mixed. The euro rallied to $1.5316 from $1.5352 late Monday. The dollar traded at 103.41 compared to 101.73 yen late Friday.

To a freer Latin America

By obstructing a free-trade agreement with Colombia, Congress is achieving a mathematical impossibility.

If opposition to the deal made no sense in terms of rational self-interest when it was sealed between the U.S. and Colombia in 2006, it makes even less sense now. Less than zero sense.

The agreement signed in November 2006 effectively stabilized an imbalance between the countries.

Most Colombian exports to this country arrive largely duty-free, courtesy of the 1991 Andean Trade Preference Act, which reduced or eliminated trade barriers to Latin American countries that took effective steps to fight drug-trafficking. A former narco-terror hell on Earth, Colombia has taken greater steps to fight the narcotics cartels than, arguably, any nation in the region.

The same relaxed trade rules do not hold for U.S. exports to the South American nation, however.

In 2006, for example, Arizona companies exported a relatively paltry $9.8 million worth of manufactured goods and electronics to Colombia, according to the U.S. Department of Commerce. And they paid a healthy fee for that privilege, including tariffs of 10 to 20 percent. Congressional approval of the Colombian free-trade agreement would strike that imbalance and almost certainly would prove an immediate godsend to Arizona manufacturers that do business with Bogota.

Even as a matter of politics, the obstruction makes no sense.

Since assuming office in 2002, Colombian President Alvaro Uribe has made huge progress in stabilizing his formerly war-torn nation. He has created one of the most stable democracies on a continent that otherwise seems to be backsliding toward its tragic roots of totalitarianism, despotism and revolution.

Uribe's long-standing friendship with the U.S. - which is to say, his friendship with President Bush - is the source of his unpopularity on Capitol Hill, of course.

That political principle - any friend of my enemy is my enemy - took center stage on March 1 when Uribe sent his commandos a mile and a half into neighboring Ecuador to take out an encampment of narco-terrorists, killing notorious rebel leader Raul Reyes.

Many congressional Democrats condemned Uribe for daring to chase the murderous, kidnap-happy terrorists into a nation that fawns over the drug-running revolutionaries.

Many of them, too, sided in the resulting border flare-up with Uribe's mortal enemy in South American, Hugo Chavez, the leftist president of Venezuela whose popularity in Congress is directly proportional to his hostility to Bush.

Trade protectionism, and the economic menace that surely would accompany it, is in the air this election season.

But snubbing a trade deal with staunchly democratic Colombia - a deal that is pure win-win for the U.S. - makes no sense, regardless.

Congress is protecting no one by fighting the Colombia trade agreement. It should approve the measure now.

The Triumph of OPEC

By Robert Samuelson

WASHINGTON -- For much of its 47-year existence, the Organization of the Petroleum Exporting Countries (OPEC) has been a cartel in name only. It could not control oil prices because many of its members regularly breached the production quotas that were intended to regulate the market. So OPEC followed oil prices up and down, as supply and demand shifted. But now OPEC may be the real deal: a cartel that works. If so, that's bad news for the rest of the world.

Look no further than last week's OPEC meeting in Vienna. Oil ministers declined to increase production despite a strong case for doing so. Not only were oil prices fluttering above $100 a barrel, but the United States is either in or near a recession and much of the rest of the world faces an economic slowdown.

What's wrong is that a fall of oil prices is one of the mechanisms by which a recession or economic slowdown corrects itself. Lower prices for gasoline, home heating oil and diesel fuel improve consumer purchasing power. They muffle inflation and increase confidence. In this sense, they're an important "automatic stabilizer" for a faltering economy.

Oil producers don't much care. High prices have been good to them. Since 1999, annual oil revenues for OPEC countries have more than quadrupled, to an estimated $670 billion in 2007, says energy economist Philip Verleger Jr. What's less clear is whether OPEC has merely benefited from tight oil markets or has acted as a true cartel, restricting output and raising prices. The right answer is: both.

Of tight markets, there's little doubt. Two massive oil miscalculations both aided OPEC. First was a widespread underestimate of world demand, especially from China. Since 1999, China's oil use has almost doubled, to 7.5 million barrels a day (mbd) in 2007. (In 2007, world oil use was 86 mbd, up 13 percent from 1999. American oil use was 20.8 mbd, up 7 percent.) Second was an overestimate of supply. War, civil strife and nationalization have depressed production in Iraq, Nigeria, Iran, Venezuela and elsewhere. Total global capacity might be 4.5 mbd higher without these setbacks, says the Energy Policy Research Foundation (EPRINC).

But that's only the half of it. Go back to late 2006. Crude prices were slipping from about $70 a barrel in August toward $50 a barrel. A true cartel would cut production to prop up prices. That's what OPEC did. In two steps, it reduced oil output by about 800,000 barrels a day, notes economist Larry Goldstein of EPRINC. "By July, 125 million barrels of oil inventory had been wiped out," he says. At the end of 2007, inventories (measured by days of supply) were at their lowest point in three years. Prices rose.

OPEC's present market power dates to early 1999, says economist Verleger. Oil prices then were about $10 a barrel. The 1997-98 Asian financial crisis had cut demand; supply was essentially unregulated. Saudi Arabia undertook frantic negotiations with other major producers, including Iran, Kuwait, Venezuela and non-OPEC members Russia, Norway and Mexico. The result was an agreement to cut production sharply. Compliance with output quotas was surprisingly good; countries were terrified by the collapse of their oil revenues.

We are paying for past shortsightedness. Dependence on oil imports, now almost 60 percent of U.S. supply, is inevitable. But we could limit OPEC's market power by curbing our demand and increasing our supply. As the worldwide gap between supply and demand rises, it's harder for producers to control the market. More have spare capacity; more are tempted to increase production to raise revenues. Today's surplus is concentrated in a few countries, especially Saudi Arabia, which can adjust production to influence prices.

Americans rant at foreign producers on the silly presumption that they should subordinate their interests to ours. But we refuse to do much that would actually limit their freedom of action. It was only last year that Congress raised fuel-efficiency standards for new cars and light trucks. We have steadfastly rejected higher gasoline taxes to curb unnecessary driving and strengthen demand for fuel-efficient vehicles (better to tax ourselves than let foreigners tax us through higher prices). And we have consistently restricted oil drilling in Alaska and elsewhere.

By doing so little to check its own thirst for imports, the United States has contributed to OPEC's present triumph. The extent of that triumph will be tested this year and next. Non-OPEC oil supplies -- from Brazil, Canada and Kazakhstan, among other places -- will increase. Meanwhile, a weaker global economy may dampen demand. Even OPEC may be unable to hold prices at today's high levels. Whatever happens, the long-term threat of a global oil cartel will remain. We should be taking the hard steps to limit its power. Considering our past complacency, we probably won't.