Oil topped $100 a barrel for the first time Wednesday since 2008, the same year that Wall Street and Washington brought the nation to the brink of financial Armageddon.
But that was then. Surely both camps are much more prepared to deal with the fallout now, right?
Not so fast.
All appearances to the contrary, both camps have wasted very little time getting back to business as usual. Only in this case, Americans know for certain one thing they did not know back in 2008: If anything goes wrong, they'll likely be the ones to foot the bill.
And that changes everything. Here is what you do not know about how the Powers That Be have been handling high energy prices and the ongoing credit crisis, more popularly known in Washington these days as "the recent unpleasantness."
Oil and gas traders continue to bet on the market for almost no money down. That means they stand lose only 5 to 10 percent of their total investment for taking monumental positions in a market of crucial strategic importance to the nation; and the world.
If you think letting your teenager go on a $1,000 shopping spree with only $50 in his or her pocket is a good idea, then no problem. Otherwise, why would anyone even consider letting Wall Street do it, especially knowing what we know now about its tendency toward self-restraint?
When Congress was given an opportunity to rein in traders' ability to make big bets with almost no down payment, guess what it did? It backed off and decided to march Big Oil into Washington for a public berating instead.
Incredibly, that decision was made just before oil prices hit their last record high of nearly $150 a barrel on the New York Mercantile Exchange and gas streaked past $4 a gallon. Since then, little has changed.
Did you know there is a watchdog agency in Washington responsible for keeping an eye on the oil market? It is called the Commodity Futures Trading Commission (CFTC).
But rather than do its job, its chairmen have mostly used it as a way of cozying up to Wall Street executives in exchange for the high-paying jobs they really want. Indeed, as oil shot to its peak on the New York Mercantile Exchange in July 2008, the CEO presiding over that market was none other than James Newsome, the previous chairman of the CFTC.
Energy trading, as a rule, is rife with loopholes, indulgences and special dispensations granted to some but not all. And that's the rub.
Rather than ensuring all participants compete on a level playing field, allowing only the best to win in a process some might call "real capitalism," our government has made it a practice to dole out what are essentially get-out-of-jail-free cards for certain big banks, hedge funds and oil companies that curry favor before going on to dominate the market.
This is where political savvy and market know-how stealthily meet. Not surprisingly, the privileges granted aren't well monitored.
The main special privilege that all banks, hedge funds and oil companies clearly desire is something called the Bona Fide Hedging Exemption, first proposed by Goldman Sachs in 1991 in a letter sent to the CFTC, which, to this day, the CFTC will not disclose.
This privilege, which exempts its recipients from certain trading rules, was approved by then-CFTC Chairwoman Wendy Gramm, who also pulled strings for Enron before leaving the agency to join its board.