Lynch Pen | Events in Egypt important to U.S.

The current situation in Egypt has the attention of every facet of American political and economic life. The unrest there is being blamed on a lot of factors that affect Egypt’s citizens - including high inflation (they include food and fuel which our government omits from the Consumer Price Index) and high unemployment (over 10 percent). That part sounds like our economy, but they also reported on one of the television news reports that the Egyptians also blame America. Where that comes from the newscast did not say, but it might relate to the plight created by the distribution of our debt from the building boom to many banks throughout the world.

Or we might be blamed because we are not doing anything to oust President Mubarak who they blame for the country’s economic conditions. Or it might be that we are seen as trying to manipulate or control the governments of many nations - such as our involvement in Iraq, Pakistan and Afghanistan.

One thing is for sure, as the super fast electronic transfer of news accelerates, we can see rioting, burning buildings, mobs of people swarming in the streets as it is happening.

What you and I cannot do, however, is know if what we are seeing is being reported truthfully or reported as they (themedia) want us to see it.

With Facebook, text messaging and computer e-mail, the news travels instantly but the source may be a long way from the actual country being discussed.

Credibility is certainly an issue in today’s fast-paced electronic world.

The world commodity markets respond to events around the globe today when situations such as this arise and our own stock markets’ indexes dropped with the Dow down about 2.5 percent. Commodities shot up in price with oil up over $3 per barrel. Copper, gold and silver were up as protection hedges and things we use routinely such as gasoline, natural gas and heating oil were climbing in price also. The bad news travels fast and some of the reaction may be premature, but with markets closed over the weekend, it is probable no one wanted to risk the condition getting worse. Monday should be interesting for investors since this is written on the weekend.

America is not an isolated self-sufficient super power. When we try to reduce our dependence on foreign oil supplies by using our corn to produceethanol (as an example), we just contribute to the effort to push the price of corn up world wide. Commercial producers of products that use corn compete with the ethanol producers, the suppliers of our food (those that convert corn into table food products as well as those that use cornbased feed to produce beef, chickens, turkeys, etc.) and all the hungry nations in the world who are trying to improve the standard of living of their citizens so they won’t riot. This example of corn’s impact on the world’s events is just that, an example. Any food product (soybeans, wheat, rice, etc.) is of interest to every nation. Gold gets a lot of attention, but you can’t feed your citizens gold bullion.

I don’t know anything about the diet of the Egyptians, but it is reported that 40 percent of the population lives “below the poverty level,” whatever that is. I doubt that our corn production is a factor in Egypt’s situation, but America’s involvement politically must be extremely important.

We have been providing $1.3 billion in aid to Egypt according to information gained from Stratfor Global Intelligence. This organization, started by George Friedman, supplies information on global conditions that affect very high profile investors and governments around the world. (You can find them on the internet by Googling Stratfor Global Intelligence).

They say that how this situation is handled is of “significant importance” to our nation. It is expected to even affect which areas of the nation’s budget can be cut and by how much since some of the investment advisors say we will not be able to cut anything in the areas of defense and national security. That will probably bring out speculation on what we will do militarily if things really go downhill in Egypt and the rioting expands to other countries.

A quick look at a world map points out Egypt’s location as a strategic middle east partner.

The days when our super power status allowed us to influence other nations seems to be numbered as our debt continues to pile up in other countries and our own unemployment/ economic uncertainty makes our currency less stable. Recent events in Tunisia lead to a change of government induced by riots and now we will probably see a change in Egypt as a result of this outbreak.

It is unfortunate that we are not an adequate role model for the world to resort to the ballot box for change.

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Editor’s note: Leo Lynch, a native of Benton County has deep roots in northwest Arkansas. He is a retired industrial engineer and former Justice of the Peace. He can be contacted at prtnews@ nwaonline.com.

Opinion, Pages 4 on 02/02/2011