Other strange things are happening like
it doesn't recognize ifconfig
I do a locate ifconfig and it says /sbin/ifconfig
I type /sbin/ifconfig
and it says not a directory or file
I type ifcfg and it works like I would expect ifconfig to work
Other commands like ps and top don't work either.

Anyway, I was finally able to get localhost working:
ifcfg lo 127.0.0.1

and I am able to ping localhost now.

The bootup script says eth0 interface is active but when I type:
ifcfg eth0 xxx.xxx.xxx.xxx
It says eth0 is not up

I am going to try to install a new NIC card.