found.

I offer you this, from the Daily Reckoning:

Today, we are talking about one of the most boneheaded miscalculations of all time. Almost with a single maladroit stroke, a relatively small group of world-improvers undermined the progress of 9 generations. Five years later, Americans are on the losing end of the “biggest transfer of wealth in history,” as T. Boone Pickens described the oil market of 2008. George W. Bush has the highest disapproval ratings of any U.S. president in history. America’s most profitable industry – finance – has collapsed...its currency has lost a third of its value...and European, Chinese and Indian economists are wagging their fingers saying, “I told you so.”

But here at The Daily Reckoning we always look on the bright side. And the sunny side of this story is that the United States needed to be humbled. After the Soviet Union fell to its knees in 1990, America had a monopoly on worldwide military force. Nature abhors a monopoly; she needed to take the U.S. down a peg. Who better to do the job than this group of neo-cons? They knew no history; nor did they understand economics. They were the perfect people to lead the nation to disgrace and bankruptcy.

Mr. Kudlow continued his miscalculation by referring to a survey, in which 69% of respondents said they would gladly pay $300 for the war.

So far this year alone, the price of crude has risen 40%. It’s now $100 higher than when the neo-cons took America into the Iraq War. Each American uses 25 barrels of oil per year. This is equivalent to a tax of $2,500 in additional energy expense per person...or $10,000 for a family of four, annually. In addition, the war itself is estimated to cost between $1 trillion and $2 trillion. Divide that by the number of U.S. families and you get a figure of $10,000 or more.

Ooops.

But the numbers are just the beginning. High energy prices are undermining the American way of life itself, such as it is. As colleague Byron King explains, below, we’ve spent the last 100 years building the wrong kind of world. Now, many Americans are doomed to live in the ruins of a civilization that no longer works.

“Rethinking the country life,” begins an article in the New York Times . “Suddenly the economics of American suburban life are under assault,” it continues. Then, it gets down to business.

When Larry Kudlow, Laurence Lindsey and Paul Wolfowitz were explaining how nice it would be to rough up the Middle East, the average suburban American household spent $1,422 on gasoline. Now, according to the Bureau of Labor Statistics, the sum has risen to $3,196. Another estimate puts the increase in energy costs to the typical family at $50 per month. Anyway you look at it, it’s a lot of money for people who don’t have much money. And the figure goes up the further you get out in the boonies.

“Life on the edges of suburbia is beginning to feel untenable,” says the Times .

Like it or not, Americans are being forced to park their cars. This spring, they cut back on their driving at a sharper pace than anytime since 1942. But it’s hard to stop driving when you live far from work and far from shops.

Meanwhile, we got the latest figures on the U.S. housing market. According to the Case/Shiller survey, prices fell at their fastest rate ever in April, down 15.3% over the year before. This no doubt contributed to an enveloping funk in consumer confidence, which hit a 16-year low.

The confidence level of suburbanites falls with their house prices. We have no proof, but our guess is that no houses are falling more than those built most recently, most far out. That’s where homeowner equity is likely to be lowest...and where the increased price of commuting hits hardest. That is where house prices ought to be most vulnerable. Potential buyers will simply add up the costs of commuting – in time and money – and subtract it from what they are willing to pay for the house. The longer the commute, the lower the price.

“Prices in outer suburbs will get clobbered,” concludes economist Mark Zandi.

The country will be turned inside out by higher energy prices. The suburbs are becoming less and less desirable...compared to concentrated, close-in developments near city centers. For the first time since the 1920s, the inner cities are ‘in.’ The suburbs, meanwhile, are ‘out.’ And the further out you go...the further ‘out’ they are. Over time, many of these out-lying suburbs are likely to become slums...or maybe simply abandoned, left to become ghost towns, with tumbleweeds blowing through the empty split-levels and burned-out neo-colonials.

In the fashionable inner cities, meanwhile, the middle classes will adapt and probably be better off for it. They’ll walk to restaurants, to school, and to shops. In the far out suburbs, consumers will regret every trip to the shopping mall...and rue the day they listened to Larry Kudlow.

But here we let Byron King pick up this point...

“The returns are coming in from the distant precincts of the oil patch, and the winner is... Oil!

“The price for oil has barely budged based on the Saudi Summit. There has been no summer sell-off, and I’d be surprised to see a significant pullback as the summer driving season kicks into gear. (Followed by hurricane season, and then the buildup for winter heating stocks, followed by winter.)

“What’s going on? Well, what the Saudis give – in proposed, future increased production...the Nigerians take away – with ongoing oil patch carnage that forces the likes of Shell and Chevron to close vast pipeline systems. Apparently the present trumps the future, even in the futures markets. Everything is connected to everything else, isn’t it?

“Here is my take on the exit polls from the Saudi Summit...

“Consumers and their representative governments are desperate for an oil pullback. This $135 oil is draining budgets. The poor and working poor are already marginalized in this cruel world of ours. Now it’s the turn of the middle classes to get kicked into the cellar of the modern age. People are working time-and-a-half just to put food on the table and gas in the car. Retirees and others on more-or-less ‘fixed’ incomes are impoverishing slowly. Unless they are impoverishing fast. Bankruptcy filings among the older and elderly demographics in the U.S. are soaring. The bottom line is that the conventional image of a ‘decent standard of living’ is rapidly receding for many tens of millions of households. The 20th Century is truly over. (I think this has much to do with the meteoric rise of Senator Obama as well... He offers nothing new – mostly just classic, populist Democratic Party bromides – but he offers it in such a sweet and beguiling, Teflon-coated manner...)

“And it will get worse before it gets better. To be perfectly blunt, it might not even get better. Over the next year, and into the foreseeable future, in the developed world people will go broke buying motor-fuel, heating oil and natural gas. (Wait until next winter... Sweet Jeeeezus!) In the less-developed world, people will go broke buying bread. And then the poorest amongst us will starve. Any way you look at it, it’s bad for business.

“Fast-rising energy prices are decapitalizing entire nations. Energy prices are destroying wealth faster than people can re-create it. Entire segments of the world economy have hit the iceberg and are filling with cold seawater. Some industries are becoming obsolete in a matter of months. Much of the airline industry is drowning in red ink before our eyes – almost every flight in the sky is losing money, no matter how much they charge to check your suitcase or how few peanuts they put in the small package.

“And down on the ground, most motor transport is just plain uneconomic any more... ‘Dead Rigs Driving.’ Farewell to the ‘Warehouse on Wheels.’ Sic Semper Globalization.

“Large swaths of the auto & truck building industry have become capital-wastelands. For example, GM is closing SUV factories and planning to ditch the Hummer brand. This cascades down to firms that make everything that goes into a set of gas-guzzling wheels. You name it: hot-coiled strip, axles & tires, wire bundles, paints & coatings, window glass and seatbelts, and so much more. Billions of dollars worth of past investment is just gone...bye-bye, poof! And the good-jobs-at-good-wages? History.

“So, is there room for optimism here? Yes, in the sense that high prices are concentrating many minds on energy. ‘Energy’ is the most important issue of our time, bar none. That is, people are finally beginning to understand the centrality of energy to our collective existence. Take away the cheap energy, and it becomes clear that mankind has spent the past century building the wrong kind of world.

“Another way of saying it is that we’ve collectively built ‘tomorrow’s ruins’ today. And I don’t mean just the physical structures, the bad architecture and stranded infrastructure that is worthless when energy is expensive. Think as well about the social structures that are beyond worthless when energy gets expensive. Tell me when you start to get worried...

“Much of what happens in our time only happens because energy is relatively cheap and abundant. So when energy gets expensive, a lot of what happens is going to stop happening.

“I leave the rest to your imagination.”