Oil Demand to Decline in the West, according to International Energy Agency
Posted by Phil Hart on November 15, 2010 - 10:13am in The Oil Drum: Australia/New Zealand
For those addicted to more roads, airports and the sweet smell of gasoline, the IEA's 2010 World Energy Outlook includes some pretty sober reading. As they did in last year's Outlook, the IEA forecasts that OECD demand for oil has already peaked. Consumption of oil in the United States, Europe, Japan, Australia and other 'developed' OECD nations is set to decline permanently, starting about.. now.
A few short years ago the IEA saw nothing but comfortably increasing oil supplies up to and beyond 2030 for everybody. But they have come a long way since then. The IEA now directly addresses peak oil in WEO 2010, including this one remarkable quote:
If governments put in place the energy and climate policies to which they have committed themselves, then our analysis suggests that crude oil production has probably already peaked.
While that quote and their scenarios include a number of caveats and subtleties as far as the IEA is concerned, their forecast for oil demand in OECD countries is even more direct and confronting.
Starting with their forecast of primary oil demand, things might appear rosy for the merchants of economic growth, as long as no serious attempts are made to limit CO2 levels:
But the IEA does not try to obscure the facts about how that oil is shared around:
In the New Policies Scenario, demand continues to grow steadily, reaching about 99 mb/d (excluding biofuels) by 2035 — 15 mb/d higher than in 2009. All of the growth comes from non-OECD countries, 57% from China alone, mainly driven by rising use of transport fuels; demand in the OECD falls by over 6 mb/d.
In the 2009 report and public statements since then, the IEA has been crystal clear that the transition to declining consumption of oil in OECD countries starts now:
"When we look at the OECD countries -- the U.S., Europe and Japan -- I think the level of demand that we have seen in 2006 and 2007, we will never see again," Fatih Birol told Reuters in a telephone interview.
But of course, the IEA has placed greater emphasis on scenarios in their outlooks, so perhaps this is just one outcome and readers could choose themselves a happier adventure in other scenarios. Unfortunately not. While the 'Current Policies' only scenario is more moderate, OECD oil consumption is set to decline in all three scenarios modelled. This is quite remarkable given that all scenarios are optimistic with respect to reserves, resources and recovery of conventional oil and only differ signifcantly in terms of climate change policies or lack of them.
What this means for your particular part of the world may be made clearer by the table below. For the United States, oil demand is not quite flat from 2009 but falls more substantially after 2015. For Europe and Japan the declines start a little earlier, which the IEA partly attributes to choices they have made of their own free will.
To make this a little more personal for those (like me) in the west, the IEA helpfully shows what this means for you as in individual. ie. You, the reader, will be using less oil next year, and the year after that (even in the IEA's economically calm and happy view of the world):
All of this is completely contradictory to the road building, car-loving enterprises of the western world. While the IEA has moved ahead in leaps and bounds over the last few years, most of the individual member nations of the IEA (Australia being a particularly bad example) are still running with internal forecasts and assumptions that support more roads, airports and other oil intensive infrastructure.
The IEA is still too optimistic about OPEC reserves and future reserves growth and discovery rates. But peak oil campaigners in OECD countries could do worse than take the IEA 2010 World Energy Outlook at face value and ask their own Government why their policies and actions are so disconnected from the forecasts in this report.
Living with less oil tomorrow is no longer an idea of those on the fringe - the International Energy Agency now says that is the reality for most of the developed world. Pass it on.
Oil Demand to Decline in the West, according to International Energy Agency
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Oil Demand to Decline in the West, according to International Energy Agency
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251 comments
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If we see a slight decline in production among the oil exporting countries (down 5% in 2015, versus their 2005 rate), and if the oil exporting countries' 2005 to 2009 rate of increase in consumption continues out to 2015, and if "Chindia's" 2005 to 2009 rate of increase in their combined net oil imports continues out to 2015--then for every three barrels of net oil imports that non-Chindia countries bought in 2005, the non-Chindia countries would have to make do with two barrels of oil in 2015.
I once knew a man from Chinindia.
Whose girlfriend was known as Ms. Cynthia.
By day she would lounge, around in a thong,
But at night would go forth in her finest sarong.
Which is odd, because it seems she's from Amerindia
:-) Very good limerick.
There was a young lady from Chindia
Who said to the West, I'm just not in-to-ya
You're a dopey old fool, I'll take the fuel
You can build a turbine and hope it gets windia
LMAO :-)
Which, in conservative economic terms, would mean a contraction of the economy of about one third.
Is there a basis for that claim?
Economic growth and oil consumption grow in a quite synchronized manner. Only in developed countries one can see flat consumption together with growth. (In my opinion, mainly due to outsourcing of energy intensive industries - which itself is part of a globalized economy that is in jeopardy when oil production falls)
So, you're saying that I should translate "in conservative economic terms" to "in westexasfanclub's opinion"?
Oil elasticity in 1996-2006 was 0.4, i.e. when world GDP rose 1% in real terms, oil use rose 0.4%.
Wrong. Economic theory and history both strongly support Westexas's assertion. See especially the work by Leontieff. Look at longer time periods than 1996 and 2006, e.g. in Japan.
I was asking this the other day, about finding a deep economics research article on oil depletion. Everything written seems to say that substitution, technology, etc would automatically take place if oil became scarce. If economic theory says "Economic growth and oil consumption grow in a quite synchronized manner.", then it would contradict this claim. Instead it would infer growth would slow way down instead of just transferring over to another source of energy, with minor hiccups. Do you happen to have references to the theory?
I looked up Leontief technology
So oil is the low availability item, which will eventually prevent an increase in production.
This is similar to Liebig's Law of the Minimum, hmmm.
There was an article by Leontieff several decades ago in the "Scientific American." Very readable.
What 99%+ of economists do not realize is that the Authorities, EIA, IEA, USGS, CERA are quite wrong about Peak Oil being 25 or 30 years in the future. If we did have thirty years to make a transition away from oil, I do believe it could be done successfully. In other words, had we started making the transition in 1976, then we would be where we wanted to be now. I wish I could rewrite history, so that Carter would win re-election from Reagan.
Come to think of it, that would be a heckuva good science fiction story: Carter wins and sets us on a successful track to independence from oil imports by year 2,000. It could be a work of powerful imagination based on science and technology. Come to think of it, I may just write that story and submit it to ANALOG science fiction magazine--one that has been written largely for and by engineers ever since the beginning of the editorship of John W. Campbell, Jr. for ASTOUNDING SCIENCE FICTION, which later changed its name to ANALOG. However, other writers are free to take this idea and run with it.
If anybody wants to write a novel on this theme and gets it published, I'll buy ten copies of the book.
If I write the story it will mean I'll have to stop making comments on TOD for at least three months. I'm thinking novellete length rather than novel. A novel would take me a year. I know; I've written seven novels, none quite good enough or lucky enough to be published. But it sure was fun researching and writing those novels.
Brilliant Don!!!
Not only is it a great concept in and of itself (sounds a bit Heinleinian to me), but it would introduce the peak oil thesis in a totally unrelated genre, perhaps becoming part of the zeitgeist from that angle.
I hope you run with it, dude.
My inclination is to do the story. If I do I'll make an annoucement on Drumbeat so everyone will know that I'm not sick or dead or anything bad. But to write 30,000 words is going to take three months of concentrated effort. No room for TOD then except for skimming the articles.
Check out the Alternate History website. There's some great stuff there (particularly by The Mann and CalBear. Avoid DValdron's Green Antartica if you're squeamish).
Thank you.
Very strange. I question westexasfanclub's assertion about economic theory and cite a specific energy elasticity. What you present is simply a "no" and a name-drop (Leontieff). If you have nothing further, I think 0.4 stands (probably would be a lot lower if the last years were included, as oil production has stayed flat but the global economy has, in spite of the recession, moved forward since 2006).
(first post, long time lurker)
Well it is my understanding that the US. government for example, has been using several calculation tricks when calculating their GDP and omitting important statistics in order to increase their GDP way above from where it actually stands.
I can't remember the actual links but i remember reading a lot about it a couple a months ago.
Bottomline: the correlation between the oil plateau and the status of the economy might be a lot closer than one might think, there's just way to much noise in the actual data so one can't be completely sure.
Your understanding is accurate FB. Chris Martenson does some due diligence on all the bogus govt stats in his crash course (that chapter is called 'fuzzy numbers'). If you want real details, I suggest John Williams from ShadowStats.com. Relying upon government manipulated stats for any sort of analysis virtually guarantees bad results - GIGO.
As for oil vs the economy - it's more about total energy vs the economy, with oil being just one component of energy (don't forget the major role coal still plays).
You can find lots of papers like this one out there which analyze the relationship between energy consumption and economic growth:
http://www.diw.de/documents/publikationen/73/diw_01.c.357400.de/dp1017.pdf
But I really don't feel like spending the time to wade through explanations of cointegration analysis, causality and unit root tests, and all the other econometric gibberish, especially considering these sorts of papers tend to use exactly those bogus govt stats that I think calls into questions whatever results they determine. That's part of the game that is played.
FYI, regarding GDP, there are worse problems with this metric than the government manipulation of it for political purposes:
http://mises.org/daily/770
It represents a fundamentally flawed way of looking at what we term 'the economy' - but it's quantitative, and this leads people into the trap of thinking it has some meaning - and we like it because it suits our desire to quantify things - in this case via various mathematical-based econometric models which then derive their supposed meaning from it. Then we can make arguments and stake out positions and so forth, and feel like we are doing something meaningful, and exerting some sort of mastery over an unpleasant and uncooperative reality.
It's largely an illusion. And, as with most such firmly embraced illusions, it appeals strongly to one of our desires, in this case, the desire to quantify.
In this sense, it is similar to the illusion of 'democratic government as quasi-effective, quasi-representative problem solving entity and security blanket,' which is also largely fraudulent, yet is widely embraced because it satisfies our desire for some level of (vicarious) control and power and for some level of felt-security. I would argue that all such illusions are traps which lead to the sorts of problems currently manifesting so egregiously in modern society because they represent a way of avoiding reality. They facilitate our proclivities toward denial and delusion, and this could not be more obvious than our current situation with respect to peak oil.
Exactly.
It's not hard to imagine how all these illusions in society persist. You have all of these experts that are basing all of their work on assumptions that are essentially false. And then you have all manner of free-market, political etc. theories twisting the way things are perceived into oblivion. Then you have a political system that gives people great incentive to seize every modicum of power they can, if they want to stay in the game, even if they were good and honest people originally. And when those politicians have to start to face the consequences for all the crap they pulled, they can point to anyone of these so-called "experts", who might as well be alchemists the way things are going, and use their ludicrous assumptions as excuses for all kinds of corrupt and/or bad decisions.
In the end, nobody has any idea going on and thinking rationally about things doesn't really help the great majority survive, because we're unfortunately bound to this heinous system that requires perpetual growth.
That article was an interesting read as well...
I always found it ironic that the Icelandic word for GDP growth is "hagvöxtur" or prosperity growth, even though most of the things that increased Icelandic GDP in the past were almost exclusively the things that eventually brought the economy down. Things like Enron banking, "weaponizing" a small currency at a fixed rate to tilt things in our favor, selling "clean" energy to giant aluminum factories and actually losing money from the deal etc.
Didn't actually turn out very prosperous now did it?
PS. Thank god I found this site, it's like an omen in a desert made entirely of bullsh*t!
Yes
What we are told is lies.
It is difficult to have rational discussions of a future when the known past is all fabrication.
World War One is very interesting.
Robert Fisk "The Great War for civilisation: the conquest of the Middle East"
http://www.youtube.com/watch?v=b42FJwydOCY&feature=related
(Science and engineering demand reproducible results. This convention handicaps practitioners politically.)
"We are living in a world of lies -- lies that don't even know they are lies, because they are children and grandchildren of lies."
-Chris Floyd
Excellent video. The lack of any real sense of real history is, in my view, what handicaps not only politicians, but the vast majority of citizens. This is what makes Santayana's assertion accurate.
This GDP figure also includes shuffling paper between desks in the big financial houses.
Yes, it is true, developed countries are able to keep a flat consumption together with growth thanks to outsourcing. See Wagner (2010), Energy Policy, forthcoming, for a proof:
"This paper constructs a comprehensive dataset of oil and total energy embedded in
world trade of manufacturing goods for 73 countries from 1978 to 2000. Applying the
data to debates on the dependency on foreign energy sources makes clear that achieving
complete energy independence in the foreseeable future is unlikely to be feasible and
may not be desirable. Applying it to the discussion of environmental Kuznets curves
(EKCs) highlights an important distinction between production and consumption of
energy. Richer countries use relatively less energy in their industrial production yet still
consume relatively large amounts of energy indirectly..."
"While energy and pollution-intensive production migrates to poorer countries, rich societies do not alter their tastes accordingly. Trade enables richer economies to consume less energy yet still benefit from energy and pollutionintensive production...."
"...Applying this dataset to debates on the dependency on foreign oil shows that the oftencited
policy goal of independence from foreign sources of energy is increasingly difficult to
achieve, once one considers oil and energy embedded in goods crossing international borders...."
The full paper can be found here:
http://www.gwagner.com/research/energy_trade/Energy_Trade.pdf
I'm not buying it. Beyond outsourcing we have the increase in consumption efficiency driven by much higher pricing. Most of the time it is used my Prius delivers the same service as my neighbors Hummer, yet the consumption is several times less. Its just that North Americans have been largely able to thumb their noses at efficiency. Once the price goes sustainably above $100 will that still be the case? We all know huge amounts are wasted. The question is can people get wise once their wallets are under concerted attack?
A 30% reduction doesn't seem that big a deal to me. The problem is if production is really flat to decreasing, and Chindia plus ME demand is rising so fast would that be enough to blance world supply. I think we may have to make much more dramatic cuts than that.
Oil will go to the highest bidder. IMO the U.S. is much richer than China and will be able to outbid China for oil for at least ten more years. In twenty years, of course, there may be no oil imports by anybody.
I see it a bit differently.
Nationals now control northwards of, what, 85% of world oil? IOCs about 8% directly, and another 7% as shared interest? Something like that.
I think the days of oil as a freely traded commodity are nearly over. What we'll see instead are bilateral *STRATEGIC* agreements as the basis for oil deals.
How do we know? Because we saw it beginning to happen when oil went to $147/bl in '08. China/Brazil, etc. That leaked German military think tank paper also raised this as an issue:
http://www.spiegel.de/international/germany/0,1518,715138,00.html (see page 2):
The Bundeswehr Transformation Center expects that a supply crisis would roll back the liberalization of the energy market. "The proportion of oil traded on the global, freely accessible oil market will diminish as more oil is traded through bi-national contracts," the study states. In the long run, the study goes on, the global oil market, will only be able to follow the laws of the free market in a restricted way. "Bilateral, conditioned supply agreements and privileged partnerships, such as those seen prior to the oil crises of the 1970s, will once again come to the fore."
China is already preparing for such agreements, throughout Africa, S America, etc. They are building cozy relationships all around the world while we are monetarily destabilizing many nations, and dropping bombs on others. China will be able to Finlandize much of Asia, probably.
As for the US being richer - first, I think we're way beyond broke and it's only getting worse with each feckless move by the Fed and the feds, and second if China wants oil, and we outmaneuver them, they can just dump their US holdings and wipe us out in a the space of a day.
I think it's situations like this where the American strategy over the last 50 - 100 years of making itself the most hated nation on the face of the planet will really come into play.
The U.S. is still the richest country in the world because we have so many skilled people (including engineers), so much fertile land, and so much in the way of capital, i.e. buildings, tools, machinery, rails for railroads, freight cars, steel mills, etc. We also have a lot of coal and some oil and a good deal of natural gas plus plenty of taconite (low grade iron ore) in Minnesota. By comparison, China is a poor country. They are still very poor if you look at total national income; poverty is deep and very widespread in their rural areas, which is still by far most of China. So they've got a few score millionaires, so what? The U.S. has way more billionaires and multibillionaires than does China. The very rich control much (perhaps most) of the financial capital in the U.S. That financial capital can be mobilized and turned into physical capital. It is no accident that Warren Buffett bought one of the biggest railroads in the U.S. He's no fool. I've known a couple of billionaires and one multibillionaire, and they are all smart people. If you do not believe me, ask Nate Hagens; he was around the very rich back when he was in finance, managing a hedge fund portfolio.
By the way, if you want to talk to Warren Buffett, all you have to do is buy one share of Berkshire-Hathaway B shares and attend the annual meeting in Omaha. Buffett loves to talk with his shareholders. Warning: Many thousands of shareholders attend that annual meeting. Those who have held Berkshire Hathaway for thirty years or more are all multimillionaires by now. I sold my relatively few shares of Berkshire-Hathaway to finance the college education of my four kids. No regrets. I still have plenty of income from Teachers Retirement Association and Social Security. Of course, as the years go by that income will go away; that is why I say that good children are the best investment you can make. By far the best.
Don, even assuming your optimistic picture of US wealth is accurate (and I would argue many of those points with you), it won't matter in a world of bilateral agreements, a world where China can dumps it's US paper at whim to crater us, in a world that has good reason to mistrust and despise America. Thus, I'd say it is a considerably trickier business than you has portrayed.
In fact, I would say that this debate portrays nicely the differences between the two approaches: the US thinks as long as it's got dollars, or capital that can be converted into dollars (highly questionable), and the military to back up its strong arm trade tactics, it can win. Our strategy is money, and when that fails, brute force. Iron fist in an iron glove.
China is proceeding with a more sophisticated strategy - building good trade relationships (as opposed to military alliances with dictators) with resource rich nations around the world, including some form of detente with Russia - another heavy hitter in energy - and holding massive amounts of US Treasury and agency debt (though I think the latter has declined) as the ace up their sleeve (as well as being the top borrower of ongoing debt which at this point looks to be a permanent situation). Iron fist in the velvet glove, maybe.
It sure will be interesting to see what happens. I tend to see it as a clash between wisdom and arrogance, but perhaps I give the Chinese too much credit and America not enough. We'll see.
Either way, what I think cannot be plausibly asserted is that we have nothing to worry about, and that our (rapidly depreciating) dollars are sufficient to effectively shut China out of the game.
Don't worry about China dumping its trillion or so in U.S. government securities. The Fed can buy a trillion dollars of securities in about twenty minutes. It might make a ripple in financial markets, and it would tend to increase inflation in the U.S., but the Fed is ready, willing, and able to immediately buy any quantity of U.S. T-bills, notes and bonds that may be dumped in the market by anybody, including the Saudis and the Chinese.
It is amazing what you can do when you have the legal right to write checks of any amount with thin air as the backing for the checks. But that is what the Fed is doing with QE2, and I expect to see QE3 within about a year.
That may be accurate at this moment - but we're talking about a future scenario. With the deficits/debt we're building, if the Fed tried to monetize $1T after, say, QE4, (who even knows *what* the Fed's balance sheet will be at by that time!) interest rates could pop (if they hadn't already), and that would yield a collapse. I think China has the far stronger hand here, anyway you look at it. Doesn't mean the US holds no cards - just really weak ones.
I just don't think the powers that be are as powerful or as effective as you seem to think, nor as they seem to think. :)
Fasten yer seat belts...
When interest rates surge (and sooner or later they will) the Fed will just create bank reserves faster and faster--essentially printing money faster, then faster, then faster yet. In other words, I think hyperinflation is fairly likely.
So don't worry about any old student loans or mortgage loans that you owe. In six or seven years they might very well be wiped out by hyperinflation. (Of course, I set the odds of a deflationary depression in 2011 to 2012 at fifty percent. First comes debt deflation, then comes hyperinflation to get out of debt deflation.)
What currency will The Fed use to buy all these securities with? ;)
I'm sure that QE2 will work just as well for the US as debasing the coinage did for the Roman Empire. Except for that annoying collapse thing that happened at the end, it worked pretty well for the Romans.
I mean, the Goths and Vandals never tried to redeem the worthless coins the Romans paid them off in. They just sacked Rome and moved on to greener pastures.
The history of the Roman emperors debauching the denarius is fascinating. In general, the bad emperors debased the currency, but then might come a good emperor (such as Marcus Aurelius, one of my favorite philosopers) and one of the last truly good emperors, and the good emperor would restore the metallic value of both the denarius (a silver penney) and the solidus (a gold coin).
When tax revenues fall and military demands remain large--not to mention bread and circuses--then the currency will be debased. In 1965 the U.S. currency was debased by substituting base metal coins for silver. Also, after a few years, the Treasury went back on its promise to redeem $1 and $5 silver certificates in silver.
Hence I mark 1965 (Great Society plus escalation of Vietnam War) as the beginning of the end for the dollar. I do hate LBJ, not only for escalating the Vietnam War but also for debasing the U.S. currency from silver to fiat.
Excellent points, Don. I would add 1971 to your list - Nixon closed the international gold convertibility window, thus removing the last pillar of monetary restraint. Of course, I would also add 1934, when FDR outlawed possession of gold and arbitrarily revalued it, which started us down the road to a fiat currency.
You are 100% correct.
I have lived all my life south of the equator. My Dad had a Lincoln Continental that was abandoned by the District Commissioner because it used a ridiculous amount of fuel.
I have lusted over a Harley all my adult life. That has had to remain in fantasy land because of the ridiculous price of the bike.
Recently I bought my first bit of American technology, an Airex wind generator for my yacht. It is remarkable for the fact that it is built in America.
My point? American technology does not exist outside of America.
If you want to buy a Harley Sportster for about $2,700 + shipping I know of a low-mileage fairly new one that has never been in an accident. It has been ridden only by my woman friend, and she is a prudent rider.
American technology is everywhere. The Chinese import a lot of big American cars. Or see the great Italian film, LA STRADA: There are vivid scenes of riding an Army model Harley 45 cubic inch in Italy after World War II in Italy. Those bikes lasted for decades--better than anything Harley makes now.
If you want to get in touch with me, my e-mail address is in my TOD identification data, and I'd be glad to hear from you, either about motorcycles or anything else.
In 1960 I sold my German Zundapp motorcycle in New Zealand for a good price. I was in New Zealand (Auckland) for three and a half months trying to write my first novel. The novel was never finished, but I did gain an appreciation of Kiwis and also of Steinlager, which I drink when I can get it. (Easy to find in Honolulu. Hard to find in Minnesota.)
I rode motorcycles for five years before I ever got a car. My favorite bike was a 175 c.c. BSA Bantam. It would do an honest 57 m.p.h. all day long and was easy to fix. Very thrifty on gasoline. If I ever get another motorcycle (not likely, living in Minnesota) I think I'd get another old BSA Bantam. Not long ago I bought a 250 c.c. BSA Starfire (built around 1965) and that machine would really GO. It was stolen, however, and I did not get another cycle to replace it.
Agreed. This almost gaurantees a war in South East Asia as China is not able to extend its military reach much further than its neighbours while the US can fight globally with mobile battle groups.
Put aside for a second the issues with the IEA prediction methodology/data/assumptions/etc. and just assume the OECD was expected to reduce its consumptions significantly whilst Chindia grew.
What do you think would actually happen?
My guess is that once we got past somewhere around a 3-5% reduction rate, people would complain, protest, then revolt. The timescale is too small and the change to their expectations too large for them to accept it. Even with Europe doing the heavy lifting of that decline through its ongoing voluntary programs, its just not credible to see people shrug and accept it. If you want to see how close to the edge things already are, look at the UK fuel protests a decade ago. And that was over a few extra pence on the price.
So you see people complaining about the rising costs, their inability to commute to work and the death of the chelsea tractor; and they see Chindia's usage growing. It doesn't take a genius to realise that opposition politicians and demagogues will place the blame squarely on Asia and them 'using our oil'.
What does a western government do? With oil supply constrained by physics, their only option is to attempt to persuade Chindia to cut back.
However China in particular is in a red queen race. The leaders there know that if growth falters and people lose, then there are 300million without a safety net that have only allowed them to continue in power because its 'good times'. They would be torn limb from limb within months. China can't slow down, can't accept worse times, it has to keep running. It can't agree.
So OECD *has* to attempt to collapse the Chindia economy, kill the growth and thus reduce prices/increase availability to their voters. That would probably be via embargo of shipping. Equally China at least *has* to prevent that.
Be it economic or military - both sides would be set on war.
Now add back in the reality that IEA is being overly positive in their outlook. With the even further reduced supply, one way or another, only one side is capable of winning out of this. One side or the other HAS to collapse. The OECD can probably live with a collapsed Chindia. Its harder for Chindia to live with a collapsed OECD, but they could live with an imploded US (and thus their overconsumption). Given its China that has the credibility of playing the long game, we can only assume that they have a game plan that results in them getting in their implosion strike first. Does the US have an equivalent level of foresight? Under Obama I'd probably say yes.
This is the great game of the next decade. Roll up and place your bets.
The genie is out of the bottle now.
Wonder why the media don't pick up on this.
A lot of people mistakenly believe that peak oil won't really make a difference--renewables will somehow magically ramp up, or there will be efficiency gains that will allow us to keep Business as Usual, or somehow, "The Market will Provide". People don't look deeply enough into the situation, to understand the real problem. And of course politicians don't want to let the truth be known, because they don't have a solution that will allow BAU to continue.
People need to remember that renewables today, after many years of expansion, are only a tiny portion of the energy supply, and themselves take fossil fuels to produce.
People also need to remember that it takes a very long to replace all of the cars on the road. At one time, I remember hearing that a car lasts 20 years on average. When one considers that a car that is used in the US is often shipped to Mexico or some other poorer country when we think it is beyond its normal lifetime, that may still be the case today.
Another part of the problem is if cars that are considered gas guzzlers suddenly become obsolete, the trade-in value of a huge number of cars will drop dramatically. How may folks are going to be able to buy a new (probably more expensive) plug in vehicle, if the trade-in-value of their existing car has dropped dramatically?
In the worst case, you can save 30% of fuel consumption by driving the existing vehicle fleet 30% fewer miles. Over 50% of miles currently driven are economically non-essential.
However, even with modest increases in fleet mileage, movement of trips to mass transit, reduction of trips through car-pooling, etc., the impact of a 30% fuel usage reduction would be a lot less.
Correct, Merrill, this article assumes a reduction in oil consumption is necessarily bad. All these studies assume an increase in transportation services (passenger-km and ton-km). The transportation services don't seem to be explicitly stated in WEO 2010, but they are in the EU Commission's recent "Energy Trends to 2030"(http://ec.europa.eu/energy/observatory/trends_2030/index_en.htm).
For example in its reference scenario:
German oil consumption 2010-2030: -25% (down to 84 Mtoe)
German passenger kilometers: +20% (up to 1.3 trillion passenger km)
German freight kilometers: +15% (up to 0.6 trillion ton km)
You can argue that the decrease in oil intensity won't be achieved, but it should be acknowledged that it's possible to get more transportation services from less oil.
I'm starting to have my doubts Gail.
Between demand destruction and unconventional/shale plays, I'm wondering if a sort of modified version of BAU can go on for a lot longer than we thought.
Which perversely makes me more depressed!
You see, with the collapse at least the doomer dogs could have their day.
But without collapse, the usual suspects just keep getting richer and richer, and nobody complains about Wall Street or fossil fuels because, well, we get to keep our tummies full, our lights on, and our cars running.
What's not to like?
The things that go hand in hand with BAU? Off the top of my head, climate change, species and ecosystem loss, desertification, oceanic dead zones and acidification, fisheries collapse, topsoil loss, aquifer depletion, and the increasing toxicity of our environment, for starters?
Lots not to like in this partial list, methinks. And that's only the environmental piece of it - plenty more not to like on the societal front.
Sure, but OS mentioned good stuff, didn't he? Wealth, full tummies, running cars, lights...
Btw, there is no way back. Potentially, the stuff you mention is a phase we're going through, while not rich enough, enlightened enough, sufficiently technologically advanced and so on. Much evidence points to this.
However, if we lose BAU, then we'll keep multiplying and fight over the right to deplete our last resources, pollute the last land and kill the last animals before we go belly-up ourselves. Without BAU, I think there is no hope. With BAU, I think we've got a good chance to pull through.
Either way, the biosphere gets trashed. "Just a phase it's going through".
BAU and growth can limit the damage, as it enables us to collectively act more and more like sentient, rational actors. With collapse and poverty, we will be akin to locust. Any chance we have lies in going forward with technology, material wealth and globalization.
Let me get this straight, the perversely irrational insistence, on the continued maintenace of BAU and growth, which are basically the fundamental root cause of all the damage being done to our support systems, without which we cannot survive, let alone sustain BAU, is in your opinion a good thing?
Excuse me, while I repeatedly smash my head into my desk ...
Ahhh! That feels so much better now!
I gave up with him months back.
For countries currently industrialized, when were:
* peak fertility
* peak oil per capita
* peak ozone damaging pollution releases
* peak particulate pollution from fossil plants
* peak nuclear isotope pollution from nuclear plants
* peak lead pollution from cars
* peak chemical pollution of lakes and streams
... and more. I think most of these lie around 1970. That's when we had peak destruction of support systems. Some things that are in the commons have continued to deteriorate, most prominently perhaps fisheries. However, most stuff has been getting better and the stuff that hasn't could get better, if we just got around to it. And how do we get around to it? Yes, by having and improving a structured, productive capitalist/democratic society in which we feel we can afford to protect that which needs protection. By promoting international trust and collaboration.
So we have been going down the destruction curve for decades. Some developing countries haven't peaked yet, so they need to do that, fast, and the primary enabler is growth by improved institutions, production and trade. Your perverse and irrational insistence on abandoning BAU and getting poorer, however, would make our destruction curve turn up again, reaching a new peak, because environmental safeguards won't hold against desperate people.
Right, if you consider a place like China it might be in the middle of some of these problems. Peak does not apply to many issues. This is really a definitional issue, as it is possible to get a new peak in many of these cases given the right scenario. It is just about impossible to get a peak from a non-renewable resource once it occurs. Pollution is very much renewable though not welcome. You have to always be diligent to prevent pollution.
Agreed. And the way to become diligent and keep being diligent is what I mentioned.
That statement is *NOT EVEN WRONG*!
http://steadystate.org/discover/downsides-of-economic-growth/
Whether we want to abandon the concept of economic growth as a solution to our problems is completely irrelevant because the usefulness of BAU as a viable paradigm has long ago ceased to be valid. To deny the damage already done to the world at large is to be either willfully ignorant of reality or to wallow like a pig in the fetid mud of delusion. You seem to believe that the cure for cancer can be accomplished by giving out free cigarettes, Yeah it will work because the cancer won't survive once the patient is dead.
To be clear, I absolutely do not *WANT* to become poorer. We, all of us, are already becoming poorer by the minute. I want most of all to live in a sustainable, more equitable manner. As I look out daily onto the devastation that surrounds me as far as the eye can see, my heart sinks! BTW, I live in what most believers in BAU would consider a very nice place. However I have at least some inkling as to the true ecological costs of those so called niceties and know that we are all living on borrowed time and resources.
We need, and dare I say it, have a responsibility to profoundly change the current underlying paradigm. The only thing that I have found so far that even comes close to possibly serving as a foundation for this new paradigm would be biophysical economics which by definition is based on the principles of thermodynamics and energy flows in and out of ecosystems, governed by chaotic non linear dynamics. This is the only reality that makes any sense.
Best hopes for more people understanding the need for a steady state economy.
Well said. I particularly liked this bit: "to wallow like a pig in the fetid mud of delusion" :)
I hadn't heard of biophysical economics - will check it out, thanks.
Regarding ecological footprint, the WWF "Living Planet Report" of 2008 gives me support. The world ecological footprint per capita peaked before 1975. For the rich countries it would be in line with the average carrying capacity of the Earth if it weren't for the high weight given to carbon and AGW in this model.
Fortunately, your view is still in a pitiful minority.
I don't deny the damage done. I just acknowledge that we have been getting better for a long, long time, thanks to capitalism, democracy and technology.
Then embrace technology, trade, immigration and growth. No, I know you won't.
Is it? Or is it just a dopey excuse to put humanity in shackles to further your own agenda?
jeppenism: (n)
1. A feebly argued post on any forum board which includes naked assertions (e.g. more capitalism leads to a healthier biosphere) and value judgments (e.g. 'dopey' or 'crazy') without providing any logical or factual backup, either within the post, or as a response to challenges later in the thread.
2. The portion of the content of such a post requiring the supporting argument which the post fails to provide.
jeppen: (n)
1. One who engages in posting jeppenisms.
Hmm. I assume you think that Fmagyars posts about "wallowing like a pig in the fetid mud of delusion" was well thought out and deserved a much better response than the one I gave? That's a very interesting and even-handed point you make! Please do go on spreading you wisdom and positive attitude. And please keep on ignoring any references I give and instead go on about "naked assertions" and lack of "factual backup". It will certainly make me try that much harder next time.
OK, I'll accept your challenge to demonstrate even-handedness. Let's look at this closely.
'Fmagyars posts about "wallowing like a pig in the fetid mud of delusion" '
First, his post wasn't *about* that at all (it was simply a memorable line he used), in fact, so this is just misdirection on your part. His post was *about* how BAU was increasing the human footprint beyond the capacity of the planet to support, and has done grave damage to the planet, and that sticking with that strategy going forward would continue this damage.
He began by providing a link, which led to the Global Footprint Network, and then articulating an argument supported by the data. And a check of that data does indeed support his argument.
IF you had followed the links provided (but this presupposes that you are actually interested in truth and have an open mind, which is clearly not the case, but I digress...), you would have seen:
"The report reveals humanity’s Ecological Footprint has more than doubled since 1966. In 2007, the most recent year for which data are available, humanity used the equivalent of 1.5 planets to support its activities. Even with modest UN projections for population growth, consumption and climate change, by 2030 humanity will need the capacity of two Earths to absorb carbon dioxide waste and keep up with natural resource consumption."
FMagyar concluded:
"Whether we want to abandon the concept of economic growth as a solution to our problems is completely irrelevant because the usefulness of BAU as a viable paradigm has long ago ceased to be valid. To deny the damage already done to the world at large is to be either willfully ignorant of reality or to wallow like a pig in the fetid mud of delusion."
Which is a conclusion supported by the data he provided, though certainly there is plenty of room for debate on various aspects. You could certainly have researched the validity of his data and argued against it - but you did not. You could certainly have provides a logical argument which called into question how he drew his conclusion from that data - but you did not.
Rather, you cited a study - without providing any links to it - which allegedly supports an alternate view. Fair enough- if the data in that report runs counter to what FMagyar cited (as you say it does), then we can have an honest debate about wherein lie the differences - factual, methodological, etc.
So I googled the study you cited (since you neglected to provide a link).
As it turns out, in fact, the report you cited makes, if anything, a stronger case for FMagyar.
The WWF's living Planet report 2010 (http://wwf.panda.org/about_our_earth/all_publications/living_planet_repo...) notes the same thing that the report cited by FMagyar said: that humans used the equivalent of 1.5 planets in 2007.
In fact, upon downloading the entire report that YOU cited, I found this:
"During the 1970s, humanity as a whole passed the point at which the annual Ecological Footprint matched the Earth’s annual biocapacity — that is, the Earth’s human population began consuming renewable resources faster than ecosystems can regenerate them and releasing more CO2 than ecosystems can absorb. This situation is called “ecological overshoot”, and has continued since then."
http://assets.panda.org/downloads/lpr2010.pdf - page 34
Compare and contrast this with your statement:
"Regarding ecological footprint, the WWF "Living Planet Report" of 2008 gives me support. The world ecological footprint per capita peaked before 1975."
In fact, in reading the report YOU cited, I discovered that 1975 - rather than representing the PEAK - actually was the first year that the human footprint EXCEEDED the world's biocapacity. This is shown via a graph (figure 16, page 34) which is virtually impossible to misinterpret. The uptrend is continuous from 1961 to the present. The peak is proceeding year by year.
Following your citation of a report which argues precisely opposite the conclusion you somehow managed to draw from it, you then proceed along your standard course of ad hominem attacks and baseless assertions. For example:
"I don't deny the damage done. I just acknowledge that we have been getting better for a long, long time, thanks to capitalism, democracy and technology."
To put it bluntly, you first assertion above - that "we have been getting better for a long, long time" - is now shown to be baseless - based on your own preferred source of authority. Human footprint has increased since 1961 and continues to increase. This, as FMagyar was asserting, is what BAU has bought us.
Since you provided no link, I can't know for sure, but my guess is that in your urgency to find data that fit your preconceptions, you missed the point that, even if per capita footprint decreased (not proven), overall footprint *increased*. You would seem to be the victim of 'confirmation bias' - which is often the case in the presence of the dogmatic form of skepticism which cannot tolerate the notion that one might, in fact, be wrong. Any data that supports an alternate view just HAS to be wrong. This seems to be the pattern.
And, BTW, your second assertion above (which seems to be your default position) - that any gains that have been made, have done so by means of "capitalism, democracy and technology" is, as usual, a naked assertion. You provide no argument or analysis to demonstrate this.
You do follow through, as usual, with additional scornful ad hominems.
This 'jeppenistic' approach does little, in my view, to advance the debate, or to build credibility.
I hope this was sufficiently even-handed for you.
You failed. Miserably. I should probably let it all rest with that, but I won't.
This you say about FMagyars "Whether we want to abandon the concept of economic growth as a solution to our problems is completely irrelevant because the usefulness of BAU as a viable paradigm has long ago ceased to be valid." If you think this conclusion is supported by his data, you are taking a very superficial view, simply noting that "BAU", whatever that is, has coexisted with humanity's increasing ecological footprint. I'm arguing that you should consider a more complex view, where you examine how the ecological footprint changes over time, with growth and with different penetrations of capitalism and democracy.
For instance, western BAU, spreading to other parts of the world, is very successful in limiting fertility rates and thus long-term population growth. And it is well known that environmental standards and regulation improve with growth and democracy.
Since you go on about logic so much, it should be obvious to you that there is no contradiction there. The LPR 2008 is here, and my statement is obviously supported by figure 40, upper left graph, on page 27. The other graphs in the same study are also worth a look.
It's impressive that you know me so well already.
Sorry for following your lead.
Isn't it reasonable that, if BAU is to take blame for all things bad as you and FMagyar seems to agree, BAU should also be credited for all things good? And isn't BAU just that - capitalism, technology, growth, democracy? (I don't really like the term BAU. It is too broad.)
Also, naked assertions are quite useful in discussions, as some points will be debated and some conceded, and that enables the discussion to swiftly zoom in on topics that need the focus. You, however, instead of following this standard protocol of a bit of back-and-forth between assertions and in-depth-analysis, become inexplicably hostile over said assertions. You immediately start explaining how your opponent is illogical, biased, makes naked assertions and so forth, and how you'd LOVE to have an honest, open and fruitful discussion with him, but that that is made impossible by his many shortcomings, which you are unfortunately obliged to exhaustively list again and again.
Is that so?
It doesn't surprise me that your response is fraught with further dishonesty and misdirection. Getting used to that. I do want to thank you for providing yet more evidence against your own arguments.
As you said:
Indeed they are. For example, all you really need to do is to turn back one page - again, in YOUR cited reference - to page 26. The two bar graphs here represent regional eco-footprint in 1961 and 2005. The areas in which "capitalism, technology, growth, democracy" - your chosen solutions to PO - are most prevalent show the largest increases in footprint.
Regions more democratic/capitalist:
region/1961 score->2005 score
N America/5.5->9.0
EU Europe/3->4.5
Regions less democratic/capitalist:
region/1961 score->2005 score
Latin Amer/2.5->2.25
non-EU Eur/3.75->3.75
ME/CA/2.5->2.25
etc
The data here obviously contradicts your position. The more sway democracy and capitalism hold in a region, the faster the increase in footprint. In fact, most of the less democratic regions stayed the same or even REDUCED their footprint. Only one went up:
Asia-Pac/1->1.5
But of course, this region includes China, India and Indonesia, which means it saw a huge population increase relative to the rest of the world. One is forced to conjecture - did that footprint increase faster as democratic/capitalistic reforms took hold in China and India? Seems like a decent hypothesis in light of the other data. Worth looking into.
We needn't really have moved from your preferred set of graphs on page 27 at all, since the second graph in Fig 40 - the figure you are relying upon as "evidence" for your conclusion - indicates that even per capita footprint skyrocketed for "high-income countries' - let's see, those would be the ones where we are likely to find "capitalism, technology, growth, democracy", aren't they?
In fact, to make this even more ridiculous, we needn't even have moved from the very graph you chose. Look at the graph you have cited specifically - the first one of the four in Fig 40 - and look for the green line. The green line is biocapacity - it lies underneath the red line which indicates footprint, and, further, the two are diverging over time.
I would further direct your attention to page 22, Fig 31, entitled Business-As-Usual Scenario and Ecological Debt, which seems to be about as dead-on a data set as one could imagine, since this is the precise basis of our disagreement. I understand that you do not like the term BAU, but it is in wide use, as this figure shows, and I'd guess when the study uses it, we both know what they mean. That figure shows exactly what FMagyar has said, and exactly what I have said, and refutes your position directly. The ecological footprint of humanity is rising. There is no 1975 peak. Further, it is rising fastest in the nations where your vaunted capitalism and democracy and technology are most firmly entrenched. Further, the source you cite to support your position in fact totally contradicts that position.
You can squirm all you like, but the fact is, reviewing the report makes one thing very, very clear: You chose the only graph out of the entire report which *seems* to indicate some evidence for your position - though viewed closely, it becomes quickly apparent that even that is not in fact the case. The problem is: a cursory analysis is sufficient to show that yours was a superficial conclusion: the only reason the PER CAPITA footprint peaks is because of the huge population surge in Asia-Pac, and even that way of looking at things STILL shows the trend diverging from biocapacity - and every other relevant chart in the report totally contradicts your conclusion - how did you put it - that "we have been getting better for a long, long time, thanks to capitalism, democracy and technology."
Oh - wait, didn't I already note this misapprehension in my original response?
But you did not choose to quote or respond to this segment of my response. I can see why.
Honestly, you would have done better to argue from logic and not cited this WWF source as a counter to FMagyar's GFN report. But then, if you'd looked at the table of contents for this WWF report, you would have noticed that the report was done in collaboration with GFN, so really there is no reason to imagine the two - using the same data - would diverge, and certainly not as radically as you have continued to nonsensically maintain.
As to the hostility you cite, I will admit that you are right. I disagree with many of the posters here on many levels and about lots of aspects of the issues under discussion, but I also respect the good faith that is generally apparent in their posts, even when things get heated. It's what makes participating here so appealing. But reading several of of your posts before replying to one, I thought to perceive a pattern of interjecting misinformation and misdirection (and I assumed an intentionality, since you are obviously an articulate and intelligent individual) in order to "support" your arguments, in conjunction with your tendency to resort to ad hominem attacks. So I am probably reacting against what looks like intellectual dishonesty to me. Perhaps this says more about me than you. Dunno.
At any rate, unfortunately, that tends to bring out a sort of self-righteous attack dog in me. I consider this to be one of many personal deficits. Still alive and well, obviously.
That being the case, I don't think there's much point in responding further to your posts, as I think it would probably detract more than benefit the forum here. I think most who have been here for a while already figured that out. Took me a few days.
Only if you disregard population growth and count from 1961. A central theme of my argument is that footprint/capita peaked just before 1975, which can be seen in the graphs I pointed to. Also, the report says "The majority of this [high income footprint growth] was due to a nine-fold growth in the carbon component of their footprint". Less the carbon component, high income countries on average have a footprint that's sustainable. So when we say we need several Earths, we are talking AGW.
Their per capita footprint, yes, as they likely got less carbon per capita when the population grew and the rest of the world could outbuy them. Also because Western tech and know-how helps their per-dollar-consumption to be much less burdensome than it otherwise would have. But their total footprint (not per capita) absolutely soared. And you miss another central theme of my argument - the biocapacity change. High-income countries' biocapacity dropped 30%, middle-income dropped 46% and low-income dropped a whopping 63% per capita. (Due to population, of course.)
Again, that graph is mainly about AGW. Please look at page 32 for information on weight of the carbon component of the footprint. Also, my statement was that there were a PER CAPITA peak just before 1975.
The report is obviously designed to be contrary to my type of position, so it is not very surprising that I need to point out specifics and do some explaining to tell another story.
The high-income countries' per capita footprint has essentially stayed flat, and less carbon, the story would be different. I find it strange that you say "the only reason", since you impose so high standards on others. I could cite thousands of improvements in regulations and tech that make us more sustainable and our consumption less burdensome.
I responded with a link and a comment to your constant charges of being biased and so on. I won't comment on everything. And yes, the overall footprint increased - that's a given. My argument is simply that we're on the right track, and the only way for us to be able to choose to be even better is the spreading and upholding of western BAU.
I have NOT claimed that they diverge at all! I haven't compared them. I just cited from what I was familiar with.
The deficit is not so much your attack-dog-ism, as your perception of opponents. Your Internet persona is very, very similar to the one I had/was about 10 years ago. I had exactly the same problem when debating Swedish leftists! It just didn't seem plausible that they didn't understand the not-very-hard-to-understand stuff that I understand, and when they repeated faulty reasoning and facts that I had corrected, it seemed obvious that they did so out of malice - that they were dishonest and that they lied. I was angry with them, just as you are with me.
I think I'm wiser today and make this mistake much more seldomly. I realized that my position weren't necessarily that easy to understand for some, and now gather that very often they don't, in fact, get it. The situation is the same for you, it seems, although you jump to conclusions a bit more than I ever have, and you, of course, don't have the better understanding of this topic.
Peak fertility in 20th century U.S. came during the Baby Boom--roughly 20 years before 1970. If memory serves, the minimum fertility rate in 20th century U.S. came during one of the Great Depression years. I don't recall which year, but it might have been 1933 or close to that year.
Complicating matters is the fact that the U.S. age structure (the population pyramid) has varied over time, so you should not just use crude birth rates and crude death rates when looking at population trends.
"However, if we lose BAU, then we'll keep multiplying and fight over the right to deplete our last resources, pollute the last land and kill the last animals before we go belly-up ourselves. Without BAU, I think there is no hope. With BAU, I think we've got a good chance to pull through."
I'd love to see a solid chain of logic to back up these assertions, both of which I consider, to be kind, far-fatched. Lacking that logic, all ya got is opinion, and we all know what those are like. ;-)
Obviously (to anyone who has studied TOD for years) BAU cannot persist indefinitely. We do not know how long it can persist. In the U.S. if we go to CTL on a large scale--and I think we will--BAU might last another twenty years. It is hard for me to draw a scenario where where BAU lasts much more than twenty years. On the other hand, it is easy to paint scenarios in which BAU lasts only another 5 or 10 years.
I am not a fast-crash doomer. My views resemble those of John Michael Greer in THE LONG DESCENT.
Good points Don - however, I would note that we are already some decades into the collapse of the American authoritarian-corporatist empire.
No, it is not obvious. Nuclear power, for instance, can power us indefinitely. That which is hard to electrify can be powered by bio-fuels whose production has been assisted by nuclear heat and hydrogen. CTL, oil sands and natgas can be a bridge to that future.
20 years for CTL is way too low, btw. There are enormous amounts of coal.
I think my assertions constitute a solid chain of logic, but certainly, that would depend on how much knowledge the reader has. Point out the biggest leap/hole that you see, and I'll see what I can do.
"I think my assertions constitute a solid chain of logic, but certainly, that would depend on how much knowledge the reader has. Point out the biggest leap/hole that you see, and I'll see what I can do."
OK, let's start with this statement:
"Nuclear power, for instance, can power us indefinitely. That which is hard to electrify can be powered by bio-fuels whose production has been assisted by nuclear heat and hydrogen. CTL, oil sands and natgas can be a bridge to that future."
You use the word "can" three times here. You don't use statements of the form "is happening" or "are in the pipeline" or "is starting to take off" anywhere, let alone "is being built" or "are rolling out of factories" or "are now online and fully operational".
That is, instead of asserting, say, that 'government is currently successfully incentivizing behavior X among relevant industrial sectors, and the following companies have responded by building Y, and announced plans to accomplish Z' - you simply provided hypothetical "cans" which do not appear to relate to the real world in any fashion.
The fact is, there has been ZERO increase in ramping nuclear in the real world as of this point in time - especially of the fast breeder reactor or thorium reactor types that Engineer-Poet is fond of, which seem the only realistic nuclear bets. Your bland statement that "nuclear power can power us indefinitely" - absent any qualifying technical details, absent any commentary on real time efforts to make this happen - is pablum.
The same critique applies to the other "cans": biofuels have a whole host of problems for large scale implementation, and CTL is even worse. Lotsa problems with ramping tar sands production, and as for natgas, the only quasi-reasonable component on your list in terms of possible fast takeoffs, you provide no details sufficient to make any sort of analysis. You blithely fail to acknowledge any of these issues, and provide no nuts and bots arguments, obviously preferring what I think of as the 'magic wand' approach - a la: if it's theoretically possible to do so, then let's not bother to pay attention to economics, logistics, political implications, environmental implications, concurrency collisions, etc. Let's just assume this is what will happen - since it "can" (absent all of the practical considerations) be done.
And we also need to bear in mind the notion first advanced by Hirsch that a war time mobilization-level effort needs to start 20 years prior to peak for things to go smoothly, 10 years for things to be awfully bumpy, and 0 years on the expectation of massive repercussions. We are now past peak, and we have no war time type of mobilization in progress in case you'd not noticed. That means all of your cans most probably - on the basis of a practical grasp of the situation - will be relegated to won'ts.
If this is what you consider to be a "solid" chain of logic, I'd hate to see what you consider a weak one.
Is that so? Today, there is 376 GW commercial nuclear in the world, and 61 GW under construction. In January of 2007, there was 369 GW and 23 GW under construction. The ramping rate of construction is thus about 30% per year.
Regarding real-time-efforts, there is simply little urgency, since coal and NG resources are huge and since AGW worries hasn't really got traction in major economies. Also, if my statement is challenged, I'm happy to provide the technical details. I won't go on in detail if facts are known.
The beauty of the market economy is that it's very good at self-organizing to solve problems like this. We don't need to plan much and nobody needs to understand all the details. So yes, since it's possible, it will happen. If politicians don't stop it, of course.
We don't have any proof of that notion is anywhere near correct. We need to consider that there are so many ways to skin parts of this cat (CTL, oil sands, GTL, deep water, conservation, electrification and so on), and that the market economy itself is far more efficient at this kind of problem than any war-time effort.
We do need a political effort to combat AGW, however. That won't solve itself, since that's a different kind of problem.
I haven't checked your figures, but I will accept that I made a mistake in citing zero increase in the ramping of nuclear. I was thinking of America only, where, until Obama granted 2 licenses, no nuclear plants have been built since the 70s. My bad. I would contend that future efforts to ramp up nuclear plant construction in America have a seriously high wall to climb. Wikipedia:
"Also in February 2010, Vermont Senate voted 26 to 4 to block operation of the Vermont Yankee Nuclear Power Plant after 2012, citing radioactive tritium leaks, misstatements in testimony by plant officials, a cooling tower collapse in 2007, and other problems. By state law, the renewal of the operating license must be approved by both houses of the legislature for the nuclear power plant to continue operation.[51]
Other than the Vogtle project, ground has been broken on just one other reactor, in South Carolina, as of September 2010. The prospects of a proposed project in Texas, South Texas 3 & 4, have been dimmed by disunity among the partners. Two other reactors in Texas, four in Florida and one in Missouri have all been "moved to the back burner, mostly because of uncertain economics".[52] Constellation Energy has "pulled the plug" on building a new reactor at its Calvert Cliffs Nuclear Power Plant despite a promised $7.5 billion loan guarantee from the Department of Energy".[53][54] Matthew Wald from the New York Times has suggested that "the nuclear renaissance is looking small and slow at the moment".[52]"
It may surprise you to learn that I totally agree that "The beauty of the market economy is that it's very good at self-organizing to solve problems like this" - but only a FREE market operates in this way, and we do not have one of those, and arguably have not for a century or so. The energy biz is among the most heavily regulated in existence, which means that market mechanisms which might otherwise function to 'solve' problems are not permitted to do so. I'm a huge fan of spontaneous order, but this is not our underlying paradigm, in case you'd not noticed. Which it seems you have not.
You needn't feel badly - one of the most common modern myths is that America is a capitalist nation, which it is not. It is an authoritarian-corporatist regime. As such, market forces are constrained and distorted on all sides by intrusion and interference, and not free to operate in ways that would yield the sorts of beneficial results which you seem to expect. And this is more true in the energy industry than in most others.
The notion you have that "since it's possible, it will happen" represents 100% religious, magical thinking. Good luck with that.
Yes, I agree on the high wall for US nuclear. Asia will show the way from now on.
I've seen your puritan view of market economy many times before, especially from disgruntled Americans. You'd "love to have it, but unfortunately it can't be so, so anything goes".
I agree the energy market in the US is heavily regulated. But fortunately, the glass is likely half full, not half empty. But sure, the question remains how you'll react to a slow energy crunch. If you are stupid and do more regulation, such as rationing, you'll be in for a lot of hurt. If you are smart and open up for new production and more competition, you'll do fine.
I don't agree, but that's irrelevant. More interesting is your political conclusion of these views. What political forces, if any, do you support? Or do you simply want revolution and a TPTB-overthrow, may the chips fall where they will?
So what do you think the world will be like when "BAU" is totally over, and this has run to its conclusion? How much better off will the environment and the new social/civilizational systems be afterwards? Will there be less war after this? Closer to world peace?
Rationally, if BAU were totally over in the sense of a significant technological collapse, then the human capacity for mass devastation of the biosphere will be diminished considerably. The rest will sort itself out. As for war, if we truly had a technology collapse, then the power to inflict mass casualties on the battlefield would also by considerably diminished. "Total war" was an invention of the 20th century - the same century in which governments murdered 260 MILLION of their own people (RJ Rummel, Prof at Univ of Hawaii - google "democide").
I think the capacity for inflicting damage on that scale drops dramatically in the absence of the means to effectuate it.
Do I think such a world be some sort of utopia? The notion is laughable. Of course not - humans cannot tolerate anything close to utopia. There has always been war, there has always been environmental destruction, and there always will be, although until 1975, that eco-destruction did not exceed the biocapacity of the natural systems upon which we depend for life. Likewise, there has always been famine and disease, and there always will be. These things wouldn't change - but the scale upon which they could be inflicted would.
Never before in all of human history prior to the techno-age was it possible for human beings to engage in activities (activities under the control, remember, of venal politicians and gung-ho generals!) by on the sheer scale that could conceivably wipe this species of the planet, along with much of the rest of the beings here. Didn't anyone here watch Dr Strangelove? ;-)
I'll quote Wade Davis, anthropologist/ethnobotanist from National Geographic, to put things in perspective:
“It's humbling to remember that our species has perhaps been around for 600,000 years. The neolithic revolution, which gave us agriculture, at which time we succumbed to the cult of the seed, and the poetry of the shaman was replaced by the prose of the priesthood, created hierarchy, specialization and surplus - this was only 10,000 years ago – the modern industrial world as we know it is barely 300 years old. That shallow history doesn't suggest to me that we have all of the answers for all of the challenges that will confront us in the ensuing millennia.”
All that said, I doubt a total technological collapse will happen, at least not any time soon. I do think a process of deindustrialization, and relocalization and 'decomplexification' of civilization - which is almost a guarantee - will go a long way toward averting the potential for self-extinction, and for the kinds of global-scale human and eco-destruction we've witnessed in the last century or so.
Consider - we talk a lot about PO here at TOD, but it doesn't exist in isolation, as much as some of the reductionist fantasies I've seen here imply. There are a number of other resource peaks occurring nearly simultaneously with PO (not to mention other global crises which bear on all of these - talk about a perfect storm). Many of those resources require a fossil fuel powered industrial base to extract, process, transport, manufacture, etc, and even given that, are questionable in their availability for much longer. To perpetuate BAU, we would need to concurrently devise "solutions" to all of those predicaments. And the whole notion of an analytical solution is fraudulent, since, per complexity theory, that's not an appropriate approach to addressing a complex problem. Let alone a whole stack of 'em in aggregate. But it's what we are good at, so it's the approach/solution we naturally try like hell to supply. I just don't think that can possibly work. It's like attempting to use a hammer (suitable for solving a simple problem) to build the space shuttle (a complicated system). There's a mismatch here that most do not see. I get that.
I guess what I'm saying is that, like it or not, I think it's highly likely that many of us will get to see, first hand, what the world will be like when BAU comes crashing down, whether that's with a bang or a whimper.
Now, I may be dead wrong. but what I'm saying is *plausible*, IMO - a lotta really smart people think it's plausible - but things could easily go some other way. But if they don't, and if the cessation of BAU is in the cards, then doesn't it make some sense to prep for it, instead of taking a hope and pray attitude, or relying upon magical thinking (all bow down before human ingenuity, our savior!) with no back up plan?? By all means, dream up ways to avert that 'catastrophe,' if that's what you deem it, but it seems like a no-brainer to take sensible preparatory steps (like starting a backyard garden, or joining a community garden) just in case. I'd far rather be kicking myself for a fool in 5 years than chewing on my shoes for dinner.
Well, not sure about "utopia" -- I don't think perfection can be attained either, but I was wondering if it could be better than it was before we did this whole thing, i.e. if you compare, say, 500 years after the "fall" to 500 years before the "rise", could the former have _less_ war than the latter? In other words, is there a possibility for _net_ progress toward a _more_ peaceful world when viewed with the long view into the past and future -- come out of this with an overall (compared to the world of past centuries and millennia) positive gain instead of a zero gain in terms of such non-materialistic things, even if we lose much materially or get a net zero or close-to-zero gain on material things? I.e. not simply a reduction to the levels of destruction and war that happened "before", but a reduction down even further than that to some point below that?
Mike, I think the end of BAU brings all sorts of opportunities - and all sorts of perils. Just a few thoughts...this could easily be a book length topic.
The opportunities include some pretty amazing stuff - for example, the re-estabishment of REAL community, as people rediscover the notion of interdependence, and its centrality to human existence (if we review a quarter of a million years of our history). Most people do not understand that, for about a century in America, we have waged public policy war on community (conscription was a huge component). The book to read here is Kaufmann's Look Homeward, America - tough slogging in the beginning, but then gets better and better. In it, he references Wendell Berry quite a bit, who is a brilliant observer of the decline of community over the last several decades. Berry's 'The Unsettling of America' and 'What Are People For?' are two others I'd strongly recommend (though in the latter, I'd jump right to part 2). I don't think it's a stretch to say that the en masse isolation and alienation that innumerable 'moderns' report has taken an awful toll on industrial societies, and that this alienation is what has led to 'self-soothing' materialistic behaviors. Thus, I think a diminishment of the alienation via real community would result organically in an attendant diminishment in the kind of uber-materialism we see today - because that is merely an evolutionary-activated symptom of a deeper malaise.
A reinvigoration of community - you can imagine people once again sitting on their front porches, talking to friends and neighbors, sharing stories (the essence of community is knowing each other's stories) rather than sitting inside, some at the TV, others at the computer, others playing video games. Sociologists and psychologists have been shouting warnings for decades about this stuff. We did not evolve to live in that way - as almost wholly separate entities, locked away behind mediated and self-isolating experiences. OK, that's a bit of hyperbole, but you get the point, I hope.
That same relocalization will also result in fewer people moving to places far from their home places. I live in Colorado, my sister in New Jersey, my parents in Maryland with my other sister. I don't get to see them much, let alone anyone I grew up with. This type of situation makes it a lot harder to forge and sustain viable community which can persist in the face of challenges. Kunstler makes some good points about this. There are obvious downsides to that - I would not personally want to live right next door to my parents for example! :) But I think you get the point.
Lots of other tradeoffs are also obvious, once you start thinking about the relocalization, despecialization, etc which would necessarily follow an end to BAU. Bottom line: I think there is a good chance that an end to BAU would result in a sort of 're-humanization' - a ratcheting down of the systems in which we exist to a much more human scale. I think the potential benefits from such a situation *could* really be astounding.
To answer the question of war, I don't want to go too much further into the political realm than I already have, but consider this. One of the leaders of one of the most warmongering governments in history - Herman Goering, leader of the Luftwaffe for the Nazis, had this to say at the Nuremberg trials:
"Of course the people don't want war. But after all, it's the leaders of the country who determine the policy, and it's always a simple matter to drag the people along whether it's a democracy, a fascist dictatorship, or a parliament, or a communist dictatorship. Voice or no voice, the people can always be brought to the bidding of the leaders. That is easy. All you have to do is tell them they are being attacked, and denounce the pacifists for lack of patriotism, and exposing the country to greater danger."
This was not just true for Nazis - you can see strong reflections of this cynicism in the US as Wilson was dragging us into WW1, for one example (did you know opponents of war were jailed for reading the Declaration of Independence and the Constitution in public?). So one obvious point would be: don't tolerate warmongering leaders (including warmongering leaders who POSE as anti-war such as Obama).
There is a saying popular among American Buddhist communities: if you want a peaceful world, you need to start with peaceful people. And I think that there is excellent evidence (decades of research from disaster sociologists, for example) that, left to themselves, people tend to be much more peaceful than we give them credit for. A compendium of such research is discussed in Rebecca Solnit's A Paradise Built in Hell.
A related point is: if you allow something like the military-industrial-congressional complex to come into being, expect to be at war a lot.
I see PO as being helpful, potentially. First, as it becomes impossible to provide the infrastructure needs for 3rd generation, long distance, remote controlled war machines, which use a godawful amount of fossil fuels, then war may once again become more of an in your face sort of thing (perhaps moreso in Europe than America thanks to contiguous borders). One reason, IMO, that Americans are so apathetic in the face of war, is because we haven't experienced it in our backyards. In a post peak, relocalized world, are the chances higher that wars will take place locally? Maybe. If so, that would lead for far more active opposition to war, IFF you have non-authoritarian political systems (which America does not). I mean, the 20th century witnessed the first world wars, and 'total war' only because fossil fuels made that possible. Hard to imagine that happening in a post-peak world, at least, after the resource wars peter out, which could take some time, unfortunately. But it all depends on the leaders and political system people are willing to tolerate, IMO. This is why I think the issue of the actual - as opposed to illusionary - nature of our political systems is so critically important going forward.
Consider: when was the last time you saw a real majority of citizens in a nation insisting on going to war, and the State resisting that effort? It's almost always the other way round, isn't it? Often, the State uses its power to scare people into a position of support for a war the State has already determined it wishes to wage. Goering all over again.
And obviously, a military-industrial-congressional complex would be impossible to sustain in the face of drastic reductions in the reliable availability of oil, or in the face of drastically higher prices. You can easily see that by studying the history of just about any empire, which tend to fall when they overreach simply because it becomes insuperably expensive, and command economies which such empires feature are highly inefficient (especially if they lack a price system: think: Soviet agriculture). If you have a majority of of the population busy growing food, kinda hard to keep a massive standing army going.
A final point to consider: to war on a people, you must objectify, and then demonize them. Just as Nazis objectified then demonized Jews, we did the same to 'Nips' during WW2, and "commies" afterward (and some are busy today doing this with Muslims). So to avoid war, you need to see people as, well people. The best way to do this that I can think of is to engage with them - get to know them. The normal way that this happens is through trade. You don't really want to bomb customers, after all. This is why trade and commerce are so important, and cannot be left in the hands of politicians who may share Goering's views on the matter. And it''s why our politicians insist on 'managing' this "for" us. F**k that - truly free trade between peoples, not governments, is probably the best deterrent against war. The more human-to-human contact, the better, on balance, IMO.
However, what about addressing the kind of war that would occur in the _pre_-industrial age (which I presume would bear some similarity to the _post_-industrial future age), so as to achieve a reduction in the level of war to below that level and so a net nonmaterial progress as compared to previous ages?
Mike, I think it could go either way. Much depends on the lessons collectively learned after PO. I have to admit I am not sanguine, based on current experience.
On the one hand, I think there is something to the notion that "a peaceful world requires peaceful people' - and on the other, it is true that wars are started by governments, that is to say, by inept, thoughtless, cynical and power hungry rulers and elites. As Goering so aptly stated at Nuremberg.
Are we yet a peaceful people? Are we willing to finally see that there are better, more peaceful modes of social organization than centralized governments? Will such a mindset shift come to pass post-peak?
Perhaps is there is in fact a massive global die-off, as seems entirely plausible, people will be so sick of death that their rulers will not be able to lead them to war. But, history isn't reassuring in this regard.
Let me put it to you this way: as long as one set of people think it's just hunky-dorey to have men with guns go make a different set of people do what the first set thinks they should do, absent a truly compelling and imminent harm incoming to the first set of people as a result, I think we'll be in deep trouble. Because this is not a peaceful attitude. And it is the basis of our society.
That is, the only way I can see war becoming consistently less likely as we go forward, is if people come to understand the following, which I consider to be simple common sense:
1. Adam may legitimately command Benjamin to refrain from action C if and only if C is a demonstrable initiation of aggression against the person or property of Adam or against the person or property of another innocent human being.
2. Adam may legitimately command Benjamin to perform action C if and only if C is an element of a freely (non-coercively) arrived-at binding agreement between Adam and Benjamin, and C does not violate condition 1.
3. In no other case may Adam legitimately command Benjamin.
4. If, in 1, Benjamin refuses to refrain from the action C, then Adam may use proportionate force to restrain or punish him.
5. If, in 2, Benjamin refuses to perform action C, Adam may use proportionate force to elicit compensation.
6. If, in 3, Adam commands Benjamin, Benjamin may refuse to comply with such a command and, where appropriate, may resist that command with proportionate force.
Hmm. But I'm curious, just as a guess, do you think the percentage of total deaths worldwide in a given time due to war will be higher or lower than it is now, 200 years from now long after the collapse has run its course and the new system is in place or mostly so?
Now I'm curious about something else: what do you think overall life would be like afterwards, in that 200 years from now? Do you think people would be happier, sadder, more miserable, less miserable, what? Would we have lots of people barely surviving on little food, or not (esp. with a highly reduced population -- do you think we could adequately feed, say, 1 billion people or less in a healthy manner with zero fossil fuels and only lower-density energy sources?)?
jeppen:
Good question, I'm not sure that I really have an answer to that.
I guess I would sum it up this way: Since learning about peak oil and discovering more and more about how our system works after the crash of '08, I feel like I'm living in the Matrix. In a world of 7,8,9 billion humans, in a world of ever expanding fossil fuel energy and fiat currency, nothing has value. People don't have value, energy doesn't have value, money doesn't have value. The natural world probably has the least value of all.
How can this possibly continue?
I'm not suggesting the solution is atavism a la Fight Club, but I don't see how any of this ends except for very badly.
Dude. Remember the first lesson of FC. Shhh.
Take the Red Pill.
http://4.bp.blogspot.com/_RshsKGzNxWA/TB9QhCXK0fI/AAAAAAAAAEc/MFwujJaIRm...
I feel the same way.
Unplugging is very hard -- nearly impossible.
I look up at the vapour trails of the planes and think "That is so nostalgic."
Whenever I fly I like to watch the wings and flaps working, feel the G forces, hear the roar and wonder at the fact that I am 10 kms up and near the Antarctic somewhere over the South Indian Ocean.
Others think it is as boring as bat shit.
These are all yesterdays triumphs. As ephemeral as the vapour trails.
In Recent Economic Changes (1891) David Ames Wells wrote of the dramatic changes that occurred in the previous 20 years, calling it the greatest economic improvement in the shortest period in history. Among the many things he mentions is the increase in steam engine efficiency that allowed ships to carry more freight than coal, which caused a tremendous increase in international trade, and along with railroads this eliminated starvation during famines for areas served by the new transportation.
By the mid 1920s, electrification, mass production and the electric street railway system had created a standard of living far higher than could have been imagined 75 years earlier. A high quality life could be had for less than 50 hours of work each week, or 40 hours after the work week was cut in the 1930s. The depression was the result of productivity. With peoples basic needs met with decreasing hours of labor, we needed to spend on luxuries like automobiles, radios, more clothes, etc. to restore full employment. Internal combustion powered agriculture continued to lowered food costs, giving consumers more discretionary income and helping create the consumer economy. Labor saving home appliances cut housework enough to allow women to enter the labor force and also created two car households.
The whole system of growth is now in reversal. Energy conversion efficiencies for prime movers is stagnant, and EROEI is in decline. We will be unable to ever return to full employment in this situation. Oil prices will rise sharply, especially as valued in the currencies that will be devalued. We will see number of economic collapses. Who will be first? Greece? Ireland? Japan is dying but has avoided collapse so far.
Focusing on these two statements:
"With peoples basic needs met with decreasing hours of labor, we needed to spend on luxuries like automobiles, radios, more clothes, etc. to restore full employment.
We will be unable to ever return to full employment in this situation."
Seems like the first statement implies a solution to the second: if increasing hours of labor are once again required to meet basic needs (i.e. if agrarianism and related functions again becomes a big part of most people's lives), as seems likely, the same sort of full employment that existed before will again be achieved. Much of it farm based.
This makes a lot of sense, if you look at PO from the standpoint of vanishing energy slaves. After all, it was really those energy slaves - more and more over time - which resulted in the "decreasing hours of labor", those hours which then required a consumer economy to "restore full employment". We lose the slaves, we gotta do the work ourselves, we achieve full employment. Seems pretty straightforward.
The problem is that the non-essentials are such a large part of the economy. People can cut back on driving, buying new cars, eating out, text-messaging for their children and such. But the people thrown out of work by rising oil prices cannot go get a horse drawn reaper and cut wheat for a living. We still have all of the tools necessary to run a mass production and distribution society, and enough energy to do it for a few more decades.
We have some serious societal problems to deal with. Are we going to let people go hungry? Cut off care for the elderly? Should we cut the work week? How can we manage the transition to an alternate transportation system while keeping the old one functioning in the mean time.
"We have some serious societal problems to deal with."
Agreed. Big ones. They'll get worse before they get better.
"Are we going to let people go hungry?"
It won't be up to "us". What will be responsible for people going hungry in the future are the idiotic decisions we are making now and have been making for decades, particularly in the area of industrial agriculture, which collapses, absent inputs of fossil fuel, seeds, credit and government subsidies.
People should start backyard gardens and community gardens ASAP, such as Orlov says saved many lives in Russia after the Soviets collapsed.
"Cut off care for the elderly?"
Again, little choice. We've institutionalized and industrialized health care as we have every other system we could get our hands on. We've also increasingly placed responsibility for health care in the hands of unaccountable bureaucrats and profit-driven insurance companies. These things work - arguably not well, but they work - only as long as the larger political and economic systems that manage and administer them are functioning. Once that stops, they collapse. I think people with veterinarian training will be in high demand.
Orlov notes that in post-collapse Russia, calls were issued for heart and other critical drugs, and issued, and issued. After a while, the calls ceased. Not because they'd been answered. And that was in the 90s, when the rest of the world was functioning just fine.
"Should we cut the work week?"
Most may well be in survival mode - cutting the work week won't even enter into it. Attention will turn hyper-local. Those with usable skills will find work. Those without will turn to family, friends, mutual aid societies which will pop up (they always do in such situations). Most current jobs will disappear - no need for probably 90% of the work that is being done in America today. Good news is, new local manufacturing and retailing (not to mention PLENTY of work on farms) will come into existence.
"How can we manage the transition to an alternate transportation system while keeping the old one functioning in the mean time."
We won't. The circumstances will range anywhere from unpleasant to unsurvivable. I do not think we are going to be in a position to pick and choose responses - they will largely be dictated to us by conditions on the ground. At some point, one would imagine some railway and waterway transport will come back. Personally, I'd like to see dirigibles stage a comeback.
Here's the thing to consider (from David Korowicz):
"The problem, say, putting in renewable energy infrastructure, has an energy & resource cost... What we tend to concentrate upon is this cost. However we must also consider the ground beneath our feet - this is the implied infrastructure which includes all those things we take for granted but are essential to the project's completion. These might include the availability of a financial market; that supply-chains work; that contracts can be enforced; that transport systems work, really the list is endless. In total, our implied infrastructure is the accumulation of all the complex organisation and infrastructure up to this point in time, throughout global society, without which, the project cannot succeed.
While most concentrate upon the trip to the summit, the real problem is that the ground is about to crumble beneath our feet.”
Complexity theorists use the term dissipative to describe a system which must “consume energy to maintain stable global patterns.” When the energy providing said maintenance dissipates, the system becomes unstable or collapses. I thin that's what Korowicz is getting at – our modern, industrial society, constructed as it is from an integrated, interconnected framework of fossil fuels, and thus wholly dependent upon them, is a complex, dynamic (i.e. global behavior is determined by local interactions), dissipative system.
Another Korowicz quote:
"We are at the cusp of rapid and severely disruptive changes. From now on the risk of entering a collapse must be considered significant and rising. The challenge is not about how we introduce energy infrastructure to maintain the viability of the systems we depend upon, rather it is how we deal with the consequences of not having the energy and other resources to maintain those same systems. Appeals towards localism, transition initiatives, organic food and renewable energy production, however laudable and necessary, are totally out of scale to what is approaching.”
Now, some people will disagree with this, and will disagree with my assessments above. Fair enough - I make no special claim to prophetic powers. My take is simply that everything I said above is *plausible* - so while it may not happen in that way, there is every reason (excluding magical thinking) to think it *could*.
Pascal's wager applies. Risk = probability * consequences. Even if the probability is small, the consequences are staggering. Smart money is to prep. I'd rather feel like an utter fool 5 or 10 years from now than to be starving and watching my kid chew on the leather uppers from his shoes.
Organisms are dissipative systems using complex tools, information and infrastructure and must process energy continuously to maintain stability. Consider the starvation of an organism. If unable to hibernate, it will search the environment desperately for additional sources of energy. It will burn energy stores to stay alive while it searches. When the stores are depleted it will start to consume infrastructure, probably become immobile and eventually its flame goes out.
Human societies will follow a similar path and will search for more to consume, like tar sands, coal, uranium and natural gas, that will not require a sudden or drastic reorganization of our previous infrastructure investment. Sudden infrastructure changes would be transmogrifying and disrupt energy flow completely in the old system. Evolution is gradual and the evolving organism must change by small degrees over relatively lengthy periods.
But once hunger pangs begin, it may be too late to change. A starving organism, trying to maintain its current life-sustaining base metabolism, is unlikely to be successful in a major rebuilding effort.
As with the ecosystem, we need primary production from the sun, wind and water to establish the limits of our economies and populations. The utilization of fossil fuel energy has enabled and fostered our complexity and has conceived the renewable technologies which will form a basis for our future primary production of energy.
Our habits and infrastructure must be profoundly altered for any chance at continued existence. We must bury the past, it’s dead. The future offers limited possibilities for a very, very long time.
I think the analogy of systemic failure in society with that of a living organism is the best way to explain things. During starvation, hypothermia, or blood loss various physiological mechanisms kick in to suport higher hierachal functions such as the brain (nessesary to aquire energy and resources from outside the system), heart (nessesary for transporting energy and materials inside the system) and liver (for processing waste).
In our modern society the brain and heart are both equivilent to the economic system so all effort will be made to support this higher hierachal function even at the expense of the rest of the larger whole. In the case of hypothermia in the organism its even acceptable to lose extremities to frost bite as long as the system survives. In our society this could mean anyone who is not actively supporting the economy will be sidelined. The old, sick, education for children etc.
There was massive and long-lasting unemployment in the nineteenth century U.S. after the Panics of 1837, 1873, then through most of the 1880s and up to 1896 when the free minting of silver greatly increased the money supply. Then came the Panic of 1907 which was so bad in its consequences (including very high but unknown rates of unemployment) that Congress created the Federal Reserve System in 1913.
None of the employment and unemployment rates had the slightest connection to the average hours per week worked. Indeed, during the early years of the Great Depression, the number of hours worked per week by those who were employed actually increased substantially; a lot of workers were working sixty or seventy hours per week in the face of rapidly rising unemployment rates.
IMO you cannot reduce unemployment rates by cutting hours per week worked. Look at France: When they cut the work week to thirty-five hours from forty hours their unemployment rate increased significantly over the years. I find no historical cases of where a cutback in the official work week reduced unemployment rates (except perhaps very briefly, for a matter of months, not years).
You CAN reduce unemployment by cutting real wages. That is happening now and will happen more in the future, but you have to get real wages down by a lot (20% or more) to make a real dent in unemployment. Ten years from now my guess is that average real disposable income per capita will be roughly half current levels. But there will still be rising unemployment due to falling real GDP.
1. The deflation of the 19th century was related to productivity. As you note, the money supply actually rose following the Long Depression of 1873-79 and it rose much more in silver and gold than bills and notes. This should have been inflationary. However, railroads decreased transportation costs by 95% and Bessemer steel was much cheaper than iron, and had superior properties, just to name two things. Mechanized agricluture (horse drawn reapers and binders, and steam powered thrashers) improved productivity by a factor of perhaps 50.
2. Cutting the work week did not cure unemployment because depressions of the past were partly debt problem and overcapacity problems. Spreading the work around kept unemployment from being worse.
3. France, and the other developed countries are suffering from exhaustion of productivity improving technologies and from globalization. Productivity is subject to diminishing marginal returns on technology, coupled with diminishing importance of the latest technology. For example, the computer is and cell phone are not as important as railroads were in the 19th century or electrification in the 20th.
4. Cutting real wages will increase unemployment because people will eliminate discretionary spending. That is why the economy has not recovered.
I’ve written about these things:
http://en.wikipedia.org/wiki/Deflation#Scarcity_of_official_money
http://en.wikipedia.org/wiki/Long_depression#A_profit_depression_with_re...
http://en.wikipedia.org/wiki/Second_Industrial_Revolution
http://en.wikipedia.org/wiki/Productivity_improving_technologies_(historical)
I understand what you say and your good reasoning behind your conclusions.
Lowering real wages lowers real disposable income, no doubt about that. HOWEVER, there is a long term shift in how resources are allocated when real wages decline. When real wages decline, in equilibrium (after several years) the economy will employ more labor and less physical capital. To a considerable degree, labor and capital are substitutes, though of course they are also complementary inputs to production.
If everything else stayed the same (which it would not) cutting real wages in the U.S. would eventually get rid of all but frictional unemployment.
The big problem the French have is that their real wages are too high. Same for U.S.; we cannot compete with China or even Germany very well because our labor costs too much--especially including health insurance costs of employers. If we could go to a single-payer (government) funded system of health care such as Canada has we would probably cut our unemployment rate by three or four percentage points. In other words, if workers are cheaper to employ, businesses will hire more workers, despite the effect of lower total real income of wage earners.
IMHO we will never return to anything approaching full employment. The future is one of continuing decline of real GDP for the U.S., but with some fluctuations. Between QE2 (and then QE3 and 4 and 5) and a massive increase in the federal deficit (to the two to three trillion dollar range) GDP could be goosed for a few months or a year of maybe 4% real positive growth--but that would not put even a dent in current levels of unemployment.
To get rid of unemployment we would need year after year after year of real GDP growth of at least 5%. In my strong opinion, that is not going to happen.
With oil at $85 a barrel I doubt that much real GDP growth is possible. Maybe at 1% or 2% for real GDP growth for a few years, but the trend in real GDP growth is down and then further down. Hence unemployment is high and will get higher.
Didn't you yourself argue that wage adjustments could fix unemployment? Now you're saying it can't. I think it can - you don't need growth at all to have full employment. You just have to let the economy adapt to the new circumstances. The economy doesn't like to have unused resources any more than a store like to have unsold goods for years on end.
It's not the store which "dislikes" unsold goods - it is the store owner, and he does so for a human-based reason (i.e. excess inventory reduces his profits). Anthropomorphizing the economy is fallacious reasoning. An economy has no 'owner' - millions upon millions of individual choices and transactions involving capital and other factors, coupled with interference from government and other entities, comprises an economy.
The Soviet economy, for example, prior to collapse, had little problem with unused resources, human or otherwise. It's economy did not "dislike" unused resources.
Consider your assertion falsified.
A more careful way to say what I can only assume you were trying to convey would be 'in a properly functioning economy, we tend to observe an increase in the use of unused, but still useful, resources' or something similar - and then we could have a useful discussion on what constitutes 'proper functioning', 'unused but useful resources', etc. The sloppy way you phrased it renders it impossible to launch an intelligent discussion.
Now, now, don't be too hard on yourself - I think your answer was fairly intelligent. However, it wasn't as smart as it sounded, as you wasted a lot of breath trying to beat my simple illustration to a pulp, only to end up saying that you understood what I was talking about.
Good so we're agreed, then, it seems - your post was nonsensical, since you tacitly acknowledge that properly functioning economies are a prerequisite, and there is nothing resembling one of those on the horizon.
It's good to have this in the open. After all, it takes real courage to cop to the practice of illogic in a forum like this. Kudos to you. ;-)
It seems you are one of those much more interested in winning arguments than in a fruitful discussion. I'm get a bit bored by that, but let me just mention that an inference argument doesn't become "illogical" when a premise is false.
Also, it isn't false - we do have economies that resemble properly functioning ones. Especially the US one, and especially in right-to-work states. Unemployment is a choice. The US have chosen more unemployment lately, with hiked minimum laws and all that, but you could fix that if you wanted to.
I see.. You post illogic, I expose it, you change the subject. And it's me who is more interested in winning args than in fruitful discussion?
More illogic - no surprise.
If you think the US economy can under any reasonable description be called 'properly functioning' then I'd say you are too far out in fantasy land to even know what a fruitful discussion might look like.
The smaller the dog, the more intense the yapping, I guess.
Define "properly functioning". Can it get employment up if the politicians leave well enough alone? Yes it can. Not overnight, but in time.
In the LONG RUN of about seven or eight years wage adjustments can greatly reduce the unemployment rate. But as John Maynard Keynes quipped: "In the long run we are all dead."
I don't recall all the details, but there was a blurb in Science magazine recently about the three economists that won the most recent Nobel by showing that full employment is actually impossible. They called it DMP theory, from each of their names. Edit: here's some more info.
By 2010 renewables provided 25% for the worlds energy needs. Also, the majority (60%) of new energy production in the US/EU in 2009 was renewable. I wouldn't call that a "tiny portion".
http://www.ren21.net/Portals/97/documents/GSR/REN21_GSR_2010_full_revise...
With regards to EVs, Nissan is already in mass production, and has stopped taking pre-orders because of the overwhelming response. GM will begin mass production later this month, and also has a large pre-order list.
Also, oil production has been able to meet demand for the past 5 years, so it is unlikely that 2005 was the year of "peak oil".
Pardon?
Sadly my demand for lots of that old $20-$30 per barrel oil remains unfulfilled.
It is a shift to renewables, but they are far far dwarfed by the conventional ones. i wish renewables were bigger, but policy needs to shift as well as attitudes in the US toward them. currently green is another color for red commies in some circles. lol
That paper you linked to includes nuclear power as a "renewable." Nuclear is not a renewable, it just doesn't use fossil fuels as input for power generation. Uranium is not "renewable". Probably even less renewable than fossil fuels, as fossil fuels may make a comeback on our planet in 200 million years whereas uranium requires a supernova.
Also, about 15% (according to the paper) is hydro. Yes, a renewable, but at the cost of disrupting the environment, resulting in hidden costs that only become painfully apparent after your grandchildren die in the great cannibal raids of 2055.
After the great fall those of us that are left will blast those dams with our homemade gunpowder and welcome the return of the fresh-water spawning fish so that one day our children may once again experience natural abundance.
DD
> Also, about 15% (according to the paper) is hydro.
If that's the case, then peakoilisbs is talking about electricity only.
Fossil fuels provide 82% of world commercial energy, nuclear and hydro about 10%, biomass the rest. (Wind and solar are in the margin of error.)
(I saw the chart yesterday, but I can't remember where, dang it. Perhaps letting my browser track my history might not be such a bad thing after all.)
Here's the IEA's charts
http://iea.org/textbase/nppdf/free/2010/key_stats_2010.pdf
Primary energy stats have the drawback of understating the effective contribution of non-thermal sources such as hydro and wind. If you scale up wind and hydro figures to compensate and add nuclear and biomass, I guess their contribution isn't that far from 25%. And yes, nuclear isn't renewable, but its fuel is so abundant that it should be considered as good as.
I'm looking at the neighbour's PV panels, used for (a little, they tell me) hot water, installed a dozen years ago, and still the only PV in our street. Gee, they look tired. And there's no sun today. I wonder how many more years of service they'll provide?
I've been scanning this site for three years now, and really, I haven't seen a lot of change in the real world. The global mantra, "growth is good" is as solid as ever.
Maybe your avatar is right, peakoilisbs, but I wonder more if "sustainablegrowthISbs" might be a better one. "Demand" is the problem.
Cheers, Matt
PS. Does your 25% include nuclear and hydro? I think these are anti-green policy, aren't they?
"By 2010 renewables provided 25% for the worlds energy needs. Also, the majority (60%) of new energy production in the US/EU in 2009 was renewable. I wouldn't call that a "tiny portion"."
Thanks for sharing the link - it illustrates the fragility of the status of renewables nicely:
- 3% of global elec gen came from non-hydro renewables (can't grow hydro much beyond current capacity, so non-hydro is the key figure)
- of the 19% of global energy consumption provided by renewables, 70% of that was 'traditional biomass' (e.g. cow shit), leaving a total of 0.7% - yep, seven tenths of one percent, coming from solar/wind/geothermal/biomass *generation* and only 0.6% from biofuels.
Whew. 0.7% and 0.6% - tiny is definitely the right word.
That is not what the report says. What the report says is
For the second year in a row, in both the United States and Europe, more renewable power capacity was added than conventional power capacity (coal, gas, nuclear). Renewables accounted for 60 percent of newly installed power capacity in Europe in 2009, and nearly 20 percent of annual power production.
First, the paragraph isn't talking about energy in general, it is talking about electricity.
Second, what the report says about 60% is
Note it only newly installed, and only in Europe--not the US. "Renewable power capacity has to be much higher for wind and solar to produce the same amount of electricity. Presumably that is the reason for the last phrase.
This phrase must apply to newly added annual power production, unless there is a huge amount of hydropwer.
IMHO, 99%+ of people in positions of authority believe USGS, IEA, EIA, and CERA. All those agencies are uninaimous--Peak Oil is nothing to worry about for 25 to 30 years from now.
Of course, the conventional wisdom about Peak Oil (as expressed by those four agencies) is quite wrong.
Just curious how you arrived at the +99% number. I know that you have said that economists don't use the concept of uncertainty, but this number has to have huge error bars.
To the best of my knowledge, only two economists read or ever have read TOD. On the other hand, every Peak aware person I know knows of TOD, and most of them read it at least from time to time. The Peak Oil movement is TINY.
I could have said 99.5% + and still have probably been right. It would cost a lot to do a survey and find out the actual numbers.
A better measurement is not the life-expectancy, or even the average age, but the time to replace 50% of the Vehicle-Miles.
Because newer cars, travel a bigger share of the miles, that time is usually 5-8 years.
Combine that with improving mpg (or l/km) numbers, and some decline in discretionary travel, and you can take significant bites out of fuel usage.
Of course, the valid point of falling resale values, remains a problem.
The tail will not be democratic, and will not affect everyone equally.
Not everyone is planning on building more roads.
Plan 2035: The Regional Transportation Plan for Northern New Jersey
Executive Summary
The demands of maintenance of the existing roads and bridges, as well as modest modifications to improve capacity of existing roadways and lanes, pretty much preclude the addition of new roads and traffic lanes.
This is news only to the IEA. ExxonMobil 5 yrs ago projected oil demand in the developing vs developed world. (You can always tell the date of such plots because there is always an inflection upward in the following year.) I believed then and now that the left-hand plot is ridiculous but the right-hand is realistic. EM expected demand to decline because of increasingly efficient vehicles (see this plot rightmost-panel for the supposed surge in Asian gasoline consumption): hybrids in the US and a few other countries, diesels in Europe, and constant miles driven.
What is the model they use to calculate this? I hear the doomer chorus chanting about peak oil and how roads will be no more, but what I'm observing here is that the US is going to be first to the race to *replace* oil with something else (for roads, try http://www.avellobioenergy.com/ ). My personal conclusion is that drop-off is from hybrid cars running on E85. USDA estimates the corn acreage will stay about the same as now, 87-90 million acres.
From http://www.nass.usda.gov/Statistics_by_Subject/result.php?657635AA-1760-...
Gallons of ethanol produced from those 90 million acres has two compounding "moore's law for biofuels" effects:
This accounts for the dropoff I see, and DOES NOT count the following:
So what's the deal here? Shouldn't we be encouraged that 'biased' organizations like IEA are starting to pick up that we actually *are* changing to non-oil energy sources?
Just my 2 cents to this (other know much better than me): The EROI of ethanol is low and sometimes negative. Big changes in infrastructures like for example a new electric grid and electric cars need a big upfront investment - in a time with ever bigger financial restrictions. Also, the electric car might run too soon in rare earth limitations. There a many question signs and I don't see any time soon a change to non-oil energy sources at the scale needed.
Electric cars do not need a new electrical grid. There is both generation and distribution capacity to charge 10s of millions of electric cars at night during off-peak hours. More capacity can be made available by changing outdoor lighting to high-efficiency LEDs.
The motors for electric cars need not be made with rare earths. The Japanese are already developing substitute alloys.
The new grid was referred rather to renewables. Hopefully the Japanese research will give results in the real world. But how fast would this be industrially scalable? Same with the idea of using electric cars as energy storage at night. And: That will only work if batteries get much cheaper and don't loose too much of their lifetime in that process.
The US will likely be last to the race, except for net exporters.
You must mean hybrids/cars running on E85. Such a hybrid deluxe likely doesn't exist in numbers greater than a few tens of thousands; searching around a bit I came across the Saab BioPower Hybrid, which sounded great until I realized it was just a concept car from 2006.
Looking at that site's December 2009 Dashboard: Year-End Tally of hybrid sales, we see strongest regional sales in these four states:
I'd only figure Texas as a hotspot for ethanol among those. Might be worth checking into; but far as I can tell no manufacturer is rolling an E85 hybrid off the lines; perhaps owners are doing aftermarket conversions, but like I said above, that can't amount to much more than a pittance of the total, never mind that hybrids were still only 2.71% of total 2009 sales and, with 1.6 million vehicles cumulative 2005-2009, ca. 0.66% of a 246 million vehicle fleet.
The long term average corn yield increase was 1.7-1.9 by/ac. The base period, before the green revolution, was 40 bu/ac, resulting in high percentage increases. By the 2000s the yield increase was just over 1% and there is concern that the factors leading to the increase are nearly exhausted. The factors include the grain to stalk ratio, fertilizers, maximizing plant density, strains that have more sun facing leaves, pesticides and longer growing season, the latter making the whole crop more susceptible to drought. Crop wields are now increasing at or below the rate of population, and well below the amount necessary to support the improved diets in the rapidly developing countries. That is why food stockpiles have declined to the lows of the modern period.
Farm machinery uses diesel, which is more efficient than gasoline and gasohol, so the amount of useful work be considered rather than fuel value.
Good links. I hope that someone takes the time to read them.
But we can walk and chew gum.
Here is something that also needs to be explained away.
The next world conference will be held in Chennai, India.
My God is the God of the Yawning Chasms.
Well, for the US's part, from 1978-1982 MPG for passenger cars increased from 18 to 24 MPG, while gasoline supplied declined 1979-1982 873 kb/d, and only rose marginally thereafter. Corporate Average Fuel Economy is now set to rise from 25 to 35.5 MPG 2012-2016. So should we expect a commensurate decline in gasoline use in the US?
A whole host of caveats need to be thrown on the table here - first off, the numbers from 30 years ago I use above were for passenger cars, not covering light duty vehicles (LDVs) at all. This is somewhat forgivable, as cars were still almost 80% of sales then. To paraphrase Mark Twain, news of the LDV's death has been greatly exaggerated; the car/LDV sales ratio 2007-2009 was:
45.82% 50.95%
50.00% 46.83%
50.93% 46.16%
Not exactly rats fleeing a sinking ship, or the state of the buggywhip industry ca. 1910.
Gallons consumed per 100 miles or GPHM is a more apt metric to utilize than its inverse, MPG, as the gains are more readily apparent, and those gains are greatest in the initial stages. Moving from 18 to 24 MPG saved 1.72 GPHM, which was reflected in that 873 kb/d decrease in consumption; moving from 25 to 36 MPG (rounding up from 35.5) will ostensibly save 1.39 GPHM, or 80.95% of the previous figure. Will we thus save 80.95% of 873 kb/d, i.e., 707 kb/d, over this span of time? Or anything close to it? Or even more? I'd like to hear more on this topic, as the demand side is quite capable of pushing a peak date back a good while - remember those imminent warnings of a mid 90's peak from the Carter era. It was factors like CAFE that proved those wrong.
If the trend of net oil and product imports into the US continues, with net imports decreasing about 2.5 mbd every five years, I don't think CAFE matters that much.
Ah, check the monthly data - things are on the up-and-up for about a year now. If you discount that pesky Great Recession firing up in late '07 where's the beef in re: a real secular trend of declining demand? VMT cratered, bringing diesel and gasoline down with it, and things still picked up in the end. I stand by my assertion that, barring tens of millions of hybrids hitting the road - and especially from Kenworth/Peterbilt/Mack/etc - we will be addicted to the fossil fuel teat for a good while here, assuming we want a consumer economy with goods shipping all over the place round the clock.
Also, truth be told, we have had a few minor blessings in the supply side department in the US - madcap drilling in TX and ND has led to gains in the latter, flatness in the former. Dunno when these parties will end. Certainly not with $84/bbl.
2.5 mbd is the difference b/w 2005 and 2010. We made up the difference with lower consumption and a rise in biofuel supply. I don't think looking the monthly data is meaningful when looking at long-term supply and demand. In 2015, I would not be surprised if US imports are down 2.5 mbd or even greater if global supply starts declining. Maybe CAFE reduces it by .2 mbd, maybe biofuels increase another .5 mbd, that would leave a 1.8 mbd gap. I don't see domestic supply increasing in 2015 when compared to 2010 -- Alaska may be offline and deepwater has very high decline rates.
Firstly, obviously you need monthly/weekly/daily data to know anything about the current year! I'm not fixating on day to day trends of course. These shorter term data sets are helpful for analyzing volatility, identifying absolute peaks, etc., too. US demand is heading back up, which you obviously wouldn't know if you waited for the EIA to cough up another annual figure.
Also I'm saying that when recessions are on all bets are off. They're the equivalent of big volcanic eruptions as applies to studying global temperature trends; they throw off that nice clean warming trend that had built up. Thus I'm disregarding much of the drop since the absolute peak in imports in 2005 as transitory - or casting doubt that demand will fall as far as some think it might. Like Deffeyes said about the secular trend of global oil demand, it just kept on plowing ahead, despite two world wars, the Great Depression, and Jimmy Carter.
We're just a few 100 kb/d from the absolute peak of production of 2008, too. As I've intimated the demand side is where I'm at anymore, having ran out of any real solid insights as to where supply is at. Maybe the bumpy plateau is a reality, OK. Certainly the larger the geologic region the flatter its production is, even in decline. Which is a bit chimerical, since oil is a wholly fungible commodity. You can have a lot of fun aggragating nations into hypothetical continents with fantastic growth in supply, or horrific declines on the other hand. But the world as a whole I'm guessing will decline quite gently, as per HL and other analysis.
I've always thought that it was quite commonsensical that producing nations would, in a declining net imports environment, firstly cut off low priority customers - those with smaller/poorer populations, whatever some of their populace might have in the way of uber rich patrons. Anything but deny oil to nations with nuclear arsenals. Dunno how much time that buys the rest of the world.
The US consumption being currently higher than the ones of : China, Japan, Germany, Russia, and India COMBINED should clearly be the focus point for reduced consumption (for its own interest and for the world), and for that increasing the current totally ridiculous US gas tax is the only solution.
Same kind of analysis in below Deutsche Bank report :
http://www.odac-info.org/sites/default/files/The%20Peak%20Oil%20Market.pdf
The US not moving on this point will render it totally irrelevant in any international circles (if it isn't the case already).
Monetizing the debt/quantitative easing will likely have a similar effect as a gasoline tax, since QE lifts oil prices instantaneously. The U.S. will inadvertently price itself out of the market for oil through currency debasement.
Inadvertently?
"The U.S. will inadvertently price itself out of the market for oil through currency debasement."
Which doesn't exactly sound the same as the US pushing its individual citizens and state/federal investments in the right direction through a tax, in order to gradually decrease its fuel consumption and change its general infrastructure (cars fleet included), and also as a side effect decrease its budget and trade balance deficits.
Of course one can say it is too late, the crash is coming etc, but the fact remains that 1) it is never too late and 2) there is no other solution.
The FED will inflate another bubble -- eg the stock market -- and then people will spend not spending on the right items to mitigate the oil problem. Then we will crash again and people will be poor -- not knowing what the heck is going on. funny that the FED is making this a lot worse, esp. when combined with general ignorance about peak oil.
Oct, I agree with you this is what the Fed is attempting, but I don't think they will succeed. As long as real unemployment/underemployment remains north of 20% (for the foreseeable future), and housing stock stubbornly continues along its downward price spiral (no more ATM), there simply will not be the wherewithal to 'spend, spend, spend', regardless of how the stock market responds. I'm not even factoring in the onrushing unfunded liabilities/baby boom retirement issue, nor the ongoing debt overhang and accelerating public deficit/debt threat. For my money, so to speak, it's a permanent (for all intents and purposes) impoverishment scenario playing out in America. We're way past broke and the Fed's smoke and mirrors game won't change that.
Can't help thinking back the the history of the Roman Empire, eg. "bread and circus" for the proles, increasingly brutal fighting for the levers of power among the senators, eventually an emperor who declares himself a god....and conveniently morphs into a pope, eg. "next to god".
The emperor who first declared himself a god ruled near the beginning of the Roman Empire (not too many years after the end of the Republic and the long good rule of Augustus)--more than 400 years before the end of Roman Empire. Caligula is alleged to have drunk five bottles of wine a day. The Roman aristocracy drank wine with no acid in it because they liked it that way. And guess how the Romans got rid of the acid in wine: They used lead. Most of the emperors (and other wealthy Romans) suffered more or less from lead poisoning. Some authorities believe that this was either a major or the main cause of the decline of the Roman Empire.
By the way, the Greeks knew that lead compounds were poison hundreds of years B.C. The Greek slaves of the Romans drank cheap wine with no lead in it, as did the Roman soldiers. Maybe the Greek slaves were getting back at their Roman masters, who knows?
No the FED will only convince some moderately well-off folks to spend more. The vanquished from the first Housing bubble ~2007 are D.O.A. on this economy now.
I guess the squeezes works its way up the ladder until humpty dumpty falls down.
IF inflation rises 50% from current levels, then all the mortgages that are now underwater would be once again worth (in nominal terms) considerably less than the selling price of the houses.
IMO, if the Fed thinks a 50% increase in the price level is necessary to get unemployment down, then they will target it, probably at the rate of about 10% per year. Such a scenario would not surprise me at all.
My understanding of the situation is that the banks are now the proud owners of worthless real estate script whose where the chain of ownership has been broken.
To solve the problem Ben has typed a lot of zeros on his magic computer and handed those zeros to the banks. (QE subscript n).
He has told his public that this is to get the economy going again.
He should have told the banks.
Because they are using these zeros to buy artificially devalued foreign currency and assets.
Then the Politicians will be brought out to pressure a upward revaluing of these foreign assets.
The banks sell said assets at a profit and cover losses in real estate.
The buyers of the assets get to pay for bad American Real Estate, without owning any of it.
Except (there is always a fly in the ointment) that if you have a population of 1.2 billion the number of people with an IQ if 1 in a million is 1200.
We can expect blowback.
Look at the recent trip by Obama to Asia to "pursue jobs". Let`s face it, the elites are doing everything they can to maintain order (i.e. "please don`t panic while we lock you in this empty room and turn out the lights") and seem to be helping while they are actually doing what they can to ensure that only the people who can see through this situation will get through. It is amazing to watch, actually. The educated and well-paid are securing their future while the weak and hungry become ever more so. Then there are actually cross currents in the other direction (welfare, food stamps etc.) so it is confusing. or maybe I should say chaotic. But the victors are no doubt taking the spoils while they protest that they are doing everything they can to help us all.
Am I the only one that reads these 'Oil Demand to Decline in the West' pronouncements as 'Oil prices to rise in the West or the recession will continue'?
There are only 3 ways of decreasing oil demand in the west:
1) Speed Limit legislation. Jimmy Carter did it but it ain't happening again. Too unpopular.
2) Severe recession - People that lose their jobs don't drive to work.
3) Oil prices go up - When the price of gas goes up, people drive less, go slower, buy high MPG vehicles, fly less, etc.
So the only way demand is going down is (2) and/or (3). Because electric cars or natural gas cars really are not going to enter the picture until (3) happens.
You miss the fact that for 3), it can be the barrel price going up or the tax on gas being increased, do you realize that a gallon in Europe is around $6 or $7 ???
And the high level of gas tax in Europe for many years has had a very clear effect on the cars fleet if you compare it to the US, this is perfectly clear !
I understand that the word tax is a very bad word in the US, but you guys could get a bit more serious about your energy policy, no ? Increasing the US gas tax is much more important in terms of urgency with respect to peak oil than any push to renewables !! (considering the starting point as in Gail's graph above)
Yup. That chart neatly sums it up. Americans are in for a really rude awakening. The price of petrol in the US is waaaay too cheap.
Riddle me this - if Americans woke up tomorrow morning and discovered every petrol station in the country had raised their prices five-fold, putting them in line with Europe, would the reaction be:
a) a calm shrug of the shoulders?
b) a dramatic and sudden economic depression?
c) revolution?
or b) and c) combined.
Sorry America, time to smell the coffee. PO will affect all in the 'developed' world but none more so than the people of the USA.
The reaction would be no one would buy petrol. This would force the petrol stations to lower their price.
Did you happen to catch the most recent US election?
Problem here, Yves, is that America and Europe differ in a lot more ways than level of taxation on gas/petrol. America is a commuting/suburb nation, and one without much in the way of mass transit where it counts. Jack up taxes on gas anywhere near European levels, and it completely breaks the economic model. No politician or group of politicians is going to risk that, especially during an ongoing economic collapse! It will never happen, regardless of how 'good' an idea some may consider it to be. We will drive and eat our way right off the cliff. Bank on it.
But there is really quite a bit of leeway between current US gas tax level and the European one, and a lot of people do commute in Europe also, what seems clear to me is that there really are quite a few percent that can be gained in the US consumption without dramatically changing the "way of life" or breaking the "economic model", typically by moving towards smaller better MPG cars. For sure there is the problem of current "gas guzzler" losing their value, but it remains the thing to do !
Now if everybody is convinced that the fast collapse is on going, of course not much matters anyway ..., but don't think it is the case in fact, so why not avoiding the "twisted glamourness" of the fast collapse mindset and just raise the fucking tax with the right associated message ?
You just don't understand politics here. Cutting taxes is a religion. We have a faith-based economics system where 1/2 the public has convinced themselves that cutting taxes will always result in the government getting more revenue because the economy will magically grow like crazy. Of course it isn't true and that is why I call it 'faith-based economics'.
"You just don't understand politics here."
Not really, think I understand a bit about US politics, was a bit playing a "Candid role" with my messages, and I'm not at all suprised by your answer. I've also lived in the US for a while and besides, "tax" isn't a nice word in any country. I can also perfectly understand that the message "the solution is a tax" (or more precisely : a tax is necessary to push all the solutions) would appear to come from Mars to many Americans. However, there are at least a few American people asking for it, like James Hansen for instance, in this case in a fully directly redistributed mode :
In his letter to Obma prior to the elections :
http://www.grist.org/article/Dear-Barack-and-Michelle/
Here the message is fully geared towards climate change and CO2, but the principle of the tax is exactly the same regarding peak oil mitigation, and once the peak oil reality sets in within the public, seems to me that the message could go even more easily being geared towards "adapting the infrastructure towards using less oil" (with also the diminishing trade balance deficit aspect) than being based on CO2 and climate change.
The tax also doesn't need to be fully 100% redistributed, but very high transparency on the its revenue usage would probably be essential.
Overall I could return your argument : if you think that it isn't true that cutting tax is the way to go, why do you think that your position couldn't become a majority within the US ? or couldn't be part of a politician propositions ?
Why can't it become a majority position? Well for one we have 2 years until the next election.
And why can't it happen in 2 years? Well, we have two parties here. One is spineless and the other crazy/ignorant.
Look . . . my point is that it is religion . . . no logic required, just faith. There is no evidence for any super-natural diety yet 90% of the population believes. Dawkins can educate as much as he'd like but the majority will remain religious.
I just think we are not as smart as we think we are. We have individual smart people that make great contributions. And the rest of the population just copies those great contributions with mass production. And Politics is not run by consistently smart people. All it takes is 51% of the people that show up to polls and you can elect an insane idiot. So we'll elect idiots that promise us things they cannot deliver until everything is driven into the ground. At that point, maybe we'll try a smart person.
spec, you ever see the movie Idiocracy? Average intelligence army dude gets posted to a military experiment in suspended animation, which goes wrong. He wakes up many generations in the future. The beer drinking, dumb-ass, redneck couch potatoes have outbred the smart people to the point of extinction, and it turns out the army dude is the smartest person on the planet - genius level, relatively speaking. When this is discovered, the President (porn star/world wrestling champ) tasks him with solving all the world's agriculture problems (crops are all dying because the farms stopped using water and started using a mega-corporation's popular energy drink - cuz, ya know, it was good marketing). If he fails, he'll be executed in a monster truck-based gladiatorial event. Concept was funnier than the movie, but as I read your post, and contemplate PO, I could not help revisiting the movie in my mind, and began to shiver uncontrollably...
Yes, I love that movie. And to some degree, I believe we are living it.
Brawndo . . . it has electrolytes!
But given what has already been done -- getting up to a high level of energy use, it doesn't seem like that even if we had geniuses in the government who really cared right now we could truly cause a serious dent in the overall collapse, could we? Because its thermodynamically dictated that we must go to a lower level of energy use. We would have needed geniuses in the government who really cared 100 to 150 years in the past, and throughout most if not all of the 20th Century, for that to really matter, no?
Regardless of any argument on how to improve things, the believers want chaos and suffering because that is when their sky-man reappears.
"We have a faith-based economics system where 1/2 the public has convinced themselves that cutting taxes will always result in the government getting more revenue because the economy will magically grow like crazy."
Well, I am not a man of faith, by any stretch (have you seen Dawkins' hate mail bit? hilarious...), but I resist taxes quite firmly. Why? Because a sizable chunk of the revenue thus generated goes to build bombs to drop on brown people around the world, or on drones to carry the bombs to drop on brown people around the world.
So I would need to be convinced that the 'good' done by raising taxes on gas (and I would argue that any measures which enable BAU to continue are hardly an unqualified good!) would not be offset by the destructive uses to which the American warmongers would put it.
In fact, as twisted as I've been told this is, I sometimes think the most ethical thing for Americans to do is to all run out and buy Hummers. Gets us to the transition to something more sensible that more more quickly.
But I digress - point is, it's not quite so simple an ethical prospect to raise taxes as it is being made out to be. In the words of Frederick Bastiat, there is that which is seen, and that which is not seen. Most modern folk (especially mainstream economists) are positively AWFUL when it comes to ascertaining (and factoring in) what is not seen. The Law of Unintended Consequences is, IMO, an iron one...
Look at Sweden: High taxes, low unemployment, good economic growth. True, their self-defense force doesn't cost as much a fraction of real Swedish GDP as in the case of the U.S., but in the recent past (Administrations of Ronald Reagan and George Bush the First) the U.S. has had prosperity despite the drag of a big military establishment.
Bastiat is one of my favorite nineteenth-century political economists. I quote him in the first chapter of the textbook I wrote, ECONOMICS: MAKING GOOD CHOICES.
Interesting Don - I have long thought the most probable outcome of PO for America is obvious: no more America. Fragmentation seems all but a foregone conclusion to me. As this nation breaks into pieces, and those pieces look for systems to emulate, Switzerland springs to mind for me (their chief of state drives his own car to and from work, lives in a regular house - /boggle), but Sweden might be worth a look, too.
The problem I see with Sweden or countries like it (in terms of seeking to emulate) is that the population is very homogenous. I think that systems which work in homogeneous states are problematic to impose on heterogenous states. I haven't thought this through, but I do resist the notion that we can simply 'graft' another nation's policies on in light of this difference.
I think Bastiat is brilliant - wish more people read him these days. He has a lot that's relevant today, to say.
Sweden now has a lot of immigrants from Africa and Asia. Some Swedes, such as Magnus Redin, who has commented on TOD often in the past, encourage such immigration to Sweden and wish more Americans with skills should emigrate to Sweden.
If I were to emigrate (no plans to) I'd go to Sweden and learn Swedish. After all, it isn't all that different in climate, geography, and politics from Minnesota, where I happily live now. I know more than one hundred people in Minnesota of pure Swedish ancestry; they are very nice people.
From wikipedia:
As of 2008, the largest immigrant groups living in Sweden consists of people born in Finland (175,113), Iraq (109,446), the former Yugoslavia (72,285), Poland (63,822), Iran (57,663), Bosnia and Herzegovina (55,960), Denmark (44,310), Norway (44,310), Chile (28,118), Thailand (25,858), Somalia (25,159) and Lebanon (23,291). In the last decade most immigrants have come from Iraq, Poland, Thailand, Somalia and China.
That's about 450,000 non-Nordics outta 9 million+ total pop, or about 0.5%! Pretty homogenous compared to America.
I've looked into emigration (loved Thailand, and really most of SE Asia; liked Costa Rica), but Sweden isn't sunny enough! And to be honest, the more purely socialistic governments give me the willies. ;-)
I'm thinking Minnesota as the heart of a new post-PO territory modeled on Sweden might be groovy. I've got a good friend of Swedish descent who hails from there, and she is always talking Sweden up.
Oh yah, you betcha, Ole. Forty years ago I used to listen to the old folks talking Swedish, Finnish or other Scandanavian languages. They have all died out, but they left a lot of good grandchildren who are now grown up and running Minnesota.
Of course there are also the Germans in MN. Michele Bachmann sure sounds like a German name to me. St. Paul is more German and Irish than it is Scandanavian; most of the Swedes and children of the Swedes moved to the Minneapolis side of the Twin Cities a long time ago.
450,000 out of 9 million would be about 5%, not 0.5%! But what's one order of magnitude between friends ;-)
/shakes calculator vigorously, scowling
;-)
Thanks for the correction, CD, you are of course right.
That kind of mistake is much more likely to happen with electronic calculators than with slide rules. Maybe you should get a slide rule for the time when electricity is very scarce--maybe thirty or forty years from now.
Here, use mine.
http://www.antiquark.com/sliderule/sim/virtual-slide-rule.html
WOW, is that clever or wot?
I have forgotten how to use the thing!!
Nifty, but I like an old wooden slide rule that one can carry around in a holster type sheath. All the engineers had these back in the Good Old Days. Some engineers carried two slide rules, one on each hip, just as some gun fighters used to carry two revolvers.
And boy, were these old time engineers fast on the draw with their slide rules and very adept at using them.
Sigh.
I think it is about time to end my internet faste. Yesterday did national televisoon in Sweden run a 30 min piece about resource scarcity issues that mirrors how I describe the problems in my little book "När resurser sinar" http://svtplay.se/t/102814/vetenskapens_varld
But they did not get to the adaptations and solutions I describe, I better do more with this since I obviously have traction on the current trends.
Peak oil is over here going mainstream as a minor and slowly acting fact of life issue.
The election result with a continuation of the center and right wing government with support
of the largest minority in parliment and a fractured opposition gives a continuation of a
BAU that slowly dismantels our old experimet with socialism and encourages investments of
where manny are good for climate and peak oil issues. It is also realy intresting to follow
the developments with the greens and the possibity for cooperations to get a stable BAU government that could slowly and steadily accelerate post peak oil adapatations over several future elections. I think we could keep a good trend running all thru the 2010:s and into the 2020:s even with periodic problems larger then the financial crisis.
These two trends, less socialism and more personal freedom and rock solid post peak oil infrastructure, industry and government finances while USA seems to fumble could initiate
a migrations of Americans over here. It would be good to get more people with can-do
spirit!
Either way, our door is open for four more years.
Good to have you back on TOD, Magnus! Most of what I know about current conditions in Sweden has come from reading your comments on TOD over the years.
I think it's not the population, but the organization. We (Sweden) have long had a multi-party parliamentary system with strong parties (no real voting on individuals) coupled with a strong central government with very weak district and municipal governments, a weak constitution and a weak judiciary with no real checks and balances.
You have much the opposite system in all these respects. This is, to me, the reason where you can't take decisive central action in a number of areas where Sweden easily can. This is both good and bad for you, of course. Mostly good, I think.
"Look at Sweden: High taxes, low unemployment, good economic growth."
And the plant that makes PV modules just closed because it costs less to build them in Singapore. They are not immune either.
http://www.newenergyworldnetwork.com/renewable-energy-news/by-technology...
In the US, we like to drive about 100 MPH at the oil drop-off cliff. Europe's tax policy is meant to slow down the driving off the cliff a little to perhaps 30 MPH.
wonder what is best for the little guy? hmmm. A little more pain up front or kick the can down the road -- have a disaster -- and then Big Corp. can profit off of the fall out.
That is the American way.
Politically, the republicans are playing the economic turmoil to favor their policies. That prior regulations and taxes hurt businesses, hence we need to remove taxes and regs. I think there may be a benefit perceived to the republicans that perhaps another massive oil spike can be exploited to get more drilling in sensitive areas and less regs. and taxes. Who knows? But with a future economy in which sudden changes are the new normal, I imagine then America is playing with fire.
But don't forget another aspect, which is that you are not alone in sharing the annual xyz Gbarrels annual pie, and some other people might get a bit tense regarding your willingness to practise this glamourous "scorched earth politics" "for the fuck of it" ...
Watch the language. We most emphatically do not want TOD banned to high-school students.
I was editing the message that should now read :
And I'm far from being a high-school student, buddy, but feel free to action whatever censorship you deem necessary, Americans appear so numb these days that probably not much will awaken them anyway, and besides playing around with nice pie charts and launching the usual "witty sayings", any really important subject is probably better avoided, politics is disgusting after all, isn't it ?
You are totally in the wrong. Have you not read the guidlines for using TOD? I guess not.
Also see Leanan's frequent comments on this issue.
Don, I think Yves mistakenly thought you were threatening to have HIM banned and calling him a high school student.
Yves, Don was noting (I think) that if we all start swearing like sailors, then some software will disallow students on school computers from accessing this site.
OK, that done, Yves you say you lived here and understand out political system. I don't think you do. I don't think 2% of Americans understand our political system. That's because it pretends to be one thing (and people, desperately wishing to feel empowered, choose to believe it - probably related to the faith-based religious threads woven throughout American culture), but in fact is quite another thing altogether. This becomes obvious when you query Americans about war - they think they are a peaceful people, who only go to war as a last resort. They really believe America stands for peace, except for aberrations like GWB. But of course, America is one of the most blood thirsty nations in history. We've known nothing BUT war for 70 years, and we had lots of 'em before that, too, most of which we started for economic and political reasons. We have war memorials frigging EVERYwhere in this country! And highways and bridges named after wars. It's really almost funny how disconnected from this reality your average American is.
Geez, I was driving across the West last year, and hit a motel late one night, and when I came out in the morning light - right there next to this little plot of land, squeezed in between the motel and a Denny's - a big model of a helicopter and a couple of soldiers. It was a Korean War memorial in the middle of some podunk town off of I-70 or somewhere. 'Twas a real candid camera moment. It was surreal.
Americans, by and large, do not know sh*t about their own history, and are thus easily manipulated by their government via fear-based propaganda to believe that it is a socially beneficent entity that wants to solve (and is magically capable of solving) real people's problems. That's utter nonsense, of course. The facts belie it. It's own history belies it.
America is a corporatist oligarchy - because it was *designed* to evolve in precisely that direction, though most Americans now, inculcated since birth, believe in the myths about popular sovereignty and representative govt and liberty and that other rubbish that was used to get people on board for secession from Britain. Many of the American leaders wanted the same mercantilist government that Britain had since 1689, but they wanted control of it (they didn't like it when, for example, British shipmakers talked the Crown into mandating all trade to and from America must use British ships - they had no problem with the *form* of this policy, they just didn't like being left out of the deal). They got it via the coup d'etat which they used to overthrew the Articles of Confederation and replaced those flawed laws with even more flawed laws in the Constitution in 1789, which was written by lawyers, bankers and land speculators, and was the crowning achievement which led directly to where we are now. Most Americans do not even realize there were 10 American presidents of this country prior to George Washington!
The system, in America, is not 'broken' - it is functioning as it was designed to function, and there is every reason to believe it will continue to do so.
You wanna understand American politics as they actually are? Start by reading this:
http://www.amazon.com/Golden-Rule-Investment-Competition-Money-Driven/dp...
"Thomas Ferguson breaks completely with traditional voter centered accounts of party politics. In its place he outlines an "investment approach," in which powerful investors, not unorganized voters, dominate campaigns and elections. Because businesses "invest" in political parties and their candidates, changes in industrial structures—between large firms and sectors—can alter the agenda of party politics and the shape of public policy.
Golden Rule presents revised versions of widely read essays in which Ferguson advanced and tested his theory, including his seminal study of the role played by capital intensive multinationals and international financiers in the New Deal. The chapter "Studies in Money Driven Politics" brings this aspect of American politics into better focus, along with other studies of Federal Reserve policy making and campaign finance in the 1936 election. Ferguson analyzes how a changing world economy and other social developments broke up the New Deal system in our own time, through careful studies of the 1988 and 1992 elections. The essay on 1992 contains an extended analysis of the emergence of the Clinton coalition and Ross Perot's dramatic independent insurgency. A postscript on the 1994 elections demonstrates the controlling impact of money on several key campaigns.
This controversial work by a theorist of money and politics in the U.S. relates to issues in campaign finance reform, PACs, policymaking, public financing, and how today's elections work."
Agreed with everything you said, but not the "there is every reason to believe (the US) will continue (to function) like a corporate oligarchy". There is hope, I think, for things to change as collapse renders this central power (which thrives on fossil fuels like coal and oil, so easy to control, unlike the sun`s rays) weaker and weaker.
The US just happened to be founded around the same time as the Enlightenment was going on (probably as a result of the enlightenment & coal that supported the Enlightenment) so it it founded on those "scientific" "individualistic" values that the Enlightenment is known for.
But Enlightenment thinking is going out the window now as people embrace larger systems thinking and intuition and the power of nature.
The power of the Enlightenment has been a stranglehold on all of us for so long. It has been the power of fossil fuel domination---the Gilded Age, the Rockefellers, GM, Robert Moses, McDonalds, Starbucks, etc. etc. America has dominated the world with its energy power. (It had coal fields half the size of Europe, and more oil than Saudi Arabia, I believe). Americans are not evil and their Empire has only been doing what it could do, yet the results have led to environmental disaster. That is obvious. It is a relief for everyone around the world that this domination is ending. Probably for Americans themselves the relief will be most poignant and most strongly felt. At least that is the sense I get from TOD where Americans are the ones who are often giving the most comments.
I did once live in the USA too and I remember what it was like. A sense of superiority and a swagger that masks uncertainty and guilt. So I think everything will change. Down to the last attitude.
I think you are right, pi, and I should have been clear that I see PO as depriving the State of its ability to project power and wreak amplified havoc - hopefully, swiftly, as collapsing empires tend to devour themselves in the end, turning their power inward when it can no longer reach out.
I simply meant that the oligarchy will continue to act according to its nature for as long as it is able to do so.
I would say a kind word about the Enlightenment though - it made the case for reason and science, and in so doing dragged humanity (well, some of them) kicking and screaming away from ages of blind faith and superstition. Credit where credit's due. ;-)
Ok, looking back at this thread from yesterday ...
First of all about the "language" and "banning/censorship" thing, what happened is that in trying to edit my mesage above at 11:31pm, it said I had no right to access this content, so Dan locked it for editing or something. Anyway to make this short, I understand that I went a bit overboard with the language there, and will make sure it doesn't happen again.
Otherwise regarding the US political system, it is for sure, compared to some other countries overwhelmingly a dual party system, and can understand that this tends to blow away real political debate on many aspects (whereas with more parties, more ideas and necessary alliances can feed the debate), even more so with the financial sponsorship and lobbying aspects. But even with the huge military aspect of things, would still call it democratic, and think that something could come out of it.
Anyway, regarding the initial subject and the tax, still think it would be something feasible and one of the best move the US could make.
To summarize, and using the Bastiat quote provided by Don above "ECONOMICS=MAKING GOOD CHOICES", an essential aspect I see in setting up a tax on fossile fuel (but could be true for any raw material), is that it does not make any choices, it doesn't try to define a solution, but leaves the choices and solutions definition open to the individuals/organisations.
It only start from one premise : we must use less fossile fuel to run the "society", and in pushing the price of fossile fuel up compared to work or other items, it can only favor solutions using less fossile, accelerating the time when these solutions make economic sense, without defining them.
This is a key difference compared to subsidies for instance that must start from a statement of the kind "this is a good solution/product" that should be favored, and for sure there can be many mistakes in these first statements (as well as various associated cheats).
In the end, if we take more of a physical/infrastructure view than an economical one, it is all about CAPEX and OPEX : there is this big machine used by everybody made of buildings, houses, roads, cars, trains, telco networks, factories, etc with parts of varying lasting and modifiable characteristics. This on one hand is being builded/modified, on the other is being used. The usage part which could be linked to OPEX often needs energy in itself, but so does the building/modifying part (CAPEX), and if there is a "version" of this "machine" that requires less OPEX for about the same functionalities, moving to it requires CAPEX and the associated investment choices being made. The point of the tax is just to accelerate these moves. Really a banality : two rooms at 20°C, it is functionally the same thing, but one can be very poorly insulated and consuming a lot, whereas the other being well insulated consume almost nothing.
And by the way thanks to the pointer to Frédéric Bastiat, never heard of this guy before!(which isn't suprising as his wikipedia page precisely says that whereas some of his work is considered classic in the US, he is currently almost totally ignored in France) so just ordered one of his book on Amazon (as his page also says that Flaubert admired him, can only be interesting stuff !) ..
Once someone has replied to a comment, you're unable to edit it (unless you're one of the mods). I think it helps to maintain an honest discourse, because people can't go back an edit their comments into something else.
I've noticed that strange Log-In Status things happen right about that time, 11:30 PM their time, getting near midnight.
And one thing should probably be added to the picture : which is that the US is still the third oil producing country after Russia and Saudi Arabia, and if you compare OECD Europe oil per capita for gas to the one of the US in figure 3.8 above : OECD Europe around 0.5, US around 1.25 , with 9mbpd US production today and 19 or 20 consumption, it means that on its domestic production alone, the US could still have a per capita use of oil higher than OECD Europe !
It is clear that A LOT can be gained on US consumption (and saying there is no elasticity in oil demand is BS), but only a tax can bring this gain.
Btw interesting map :
How would you say America's history of war compares to, say, that of places in the Middle East, Africa or South America over the past 70 years?
Would living under, say, the Chinese regime, be worse than living under the one here overall? Esp. since you say the "freedoms" and what not are just "illusion". Or was living under the regime of the USSR worse or better or neither than this? In terms of the reality of them, that is, not illusions.
Y - For your benefit if you haven't been here long, TOD doesn't censor what folks say. But they do have guidelines on how you say it. You're certainly free to express any opinion you desire. I've seen opinions on TOD that make yours look rather meek and mild.
I would interested in hearing what subjects you deem important that aren't being cover here.
"For your benefit if you haven't been here long, TOD doesn't censor what folks say. "
HAHAHAHAHAHAHHAHAHAHAHHA!!
You are joking...right?
A great deal of opposing opinion is censured, on this site. If one does not agree with the Masters of the TOD Universe.
The Martian
M - And I assume your comment is one of those that is routinely censored? Hmmmm....wait a sec....
"I would interested in hearing what subjects you deem important that aren't being cover here."
It's not so much that there are subjects that aren't covered, but that (and this is true of most peak oil related sites or forums) the subjects are either :
1) technical
2) detached previsionist analysis views
And I have nothing against the above, but seems to me that possible mitigation policies or political directions could also be adressed, and typically in the case of the US, a tax on fossile fuel is really a key option, I don't know, a guy like James Hansen must feel very lonely ... And it is a bit easy to then refer to the "TPTB" même, when nobody cares about what could possibly being done
Y - I'll assume you're relatively new to TOD. All the topics you mentioned have been discussed in great detail on TOD in the 2+ years I've been here. Increasing fuel taxes is a perfect example of this. But conversations do flow in waves so it's just a matter of time before they bubble up again. Perhaps you can offer some unique perspective that could ramp up any such discussions. Maybe one of the problems for us "Old timers" is that we're getting a little worn out beating the same old horses. After 2 years I've joined in just about every discussion on every PO topic I can think of. I've seen any number of viable ideas presented. Unfortunately they have gone no where because, so far, TPTB just aren't listening to TOD.
Hope you hang around. So far you seem to be irritating some folks. That's not altogether bad IMHO...spurs the conversation some.
Rockman, I've been lurking here and there for quite sometimes (2 or 3 years I think), but only started reading thoroughly the threads (article comments) and posting recently, and I cannot remember a leading article clearly aimed at a fossile tax or even "political/economical energy policy" in general, but clearly I might be wrong here and having missed some.
edit : clearly wrong as there are several articles on cap and trade for instance. (but here would also be fully in line with J Hansen in thinking that a straight tax (directly redistributed or not) is much better than a cap and trade system)
Y - I also would prefer a straight fuel tax increase. Except we're at least 20-30years too late doing it. I have my doubts that we could start incremental increases in those taxes that would be sufficient to reduce demand without doing significant harm to the economy. If Carter could have passed such a change schedule (and not had it fiddled with by later politicans) the adjustments could have been absorbed slowly IMHO. Just consider how the auto industry would have altered their biz plans had they been certain gasoline would be selling for just twice what it's going for today.
I have lost the reference.
I used to be in favour of a Hansen type tax on carbon as it comes out of the ground. It seemed to make intuitive sense.
However, when I was presented with a feedback type model of the economy I saw that a tax provide the wrong feedback sign.
In essence it would drive the economy into instability.
My mistake is a common one highlighted by Thinking in Systems by Donella Meadows where the leavers of power are pushed in the wrong direction.
Would be interested to see the reasoning behind that.
Seems to me that what can be argued is that a tax on fossile fuels (or on energy in general) would decrease productivity and therefore competitiveness compared to countries without such a tax. But on the aspect of pushing the infrastructure and products towards a less "OPEX intensive" fossile fuel and energy use, really don't see why it would work in the reverse way (and comparing the European and US cars fleet could be considered as a proof element on this one).
Besides, if fully directly redistributed as proposed by Hansen, it can also be described as a fully anonymous "cap and trade" system (without the cap aspect but fully retaining the trade one). And the fully anonymous aspect of it also appears as a clear positive point to me (these days (and any days), if you have two legal system proposals sharing a common objective, one requiring a per citizen measuring flow of information to be implemented, the other not, the second one should clearly be favored)
It seems to me that there is an appalling lack of understanding about the nature of taxation throughout this discussion. Not only is the Law of Unintended Consequences nowhere considered (as though a tax yields only one consequence - the preferred one in the proponents mind), but also this position treats the tax sink (government) as the ideal, frictionless surface, so to speak. As though taxes magically accomplished the preferred objective without any negative repercussions.
In America, tax revenues are used for many purposes, but one of the chief purposes is to build bombs to drop on (generally, brown) people, and to build drones to transport bombs to drop on (generally, brown) people, and bases from which to launch the drones to transport bombs to drop on (generally, brown) people, and so on. So when you argue for any taxation, especially for some perceived ethical good, you must also consider what Bastiat called 'that which is not seen' - i.e. the secondary ethical effects which are likely to ensure under current conditions.
There is a fungibility issue involved, obviously but you would wind up with an equation where on the LHS you have benefits (reduction in energy usage and associated environmental benefit) and on the RHS you had disadvantages (x number of Pakistanis killed, continued militarism enabled, etc). Government is not a socially beneficent teddy bear, it is a grizzly. The discussion thus far assumes the former. Epic fail.
Bottom line is that taxation is NOT value neutral, and it is being treated here as though it were.
Ozzy, as for me, it seems that your arguments are overly specious ...
Where to start ?
"Government is not a socially beneficent teddy bear, it is a grizzly. The discussion thus far assumes the former. Epic fail."
Lol, what a sentence... why sarting from some premisse full of adjectives, moralistic images and metaphors, in order to reach some internet linguo conclusion? In this type of discussions, I much prefer definitions such as :
The government is the government, full stop
As to modeling the tax and its effects, a starting point could be to model only the 100% directly redistributed version as defined by James Hansen :
In which case the goverment(disgusting, greedy, and ugly as everybody should know), is only acting as a clearing house and doesn't get a cent in revenue. For sure many things could be said about the applicability of such a system, many points could be shown to be tough to address, not perfect as any system, however the resulting pressure on using and building products less fossile fuel OPEX hungry would most probably clearly appear. You can then add a percentage for the government and building common infrastructure for instance with the revenue.
As to the US federal revenue being used in a large part to drop bombs on "brown people", do you realize that one of the basic reason behind that is to secure access to resources and especially oil, or are you just pretending to have forgotten that one ?
On this argument, one thing is quite clear, if the US doesn't manage its consumption, the chances of the thing ending up in a massive ressource WAR can only get higher.
The case remains that a serious volume based fossile fuel tax, if not the only one, remains a key option in terms of energy policy and fossile consumption reduction for the US. Even if not a perfect one, granted
I'm not certain I get your drift here, Yves. I didn't start there - it was at the end of my post. The plain fact is that most people in America DO perceive their government as a socially beneficent entity. And the plain fact is that governments engage in behavior which can be described in moral terms. War and torture are two that jump immediately to mind. And metaphors are, IMO, a valid way to get a point across. Do you object to all of these? Are we to describe governments (and corporations for that matter) only in value-neutral terms? Are we to avoid metaphors, as well as adjectives, in this forum?
Maybe if you rephrased, it would help.
No offense, Yves, but I wasn't writing to YOUR preferences. I was making my own points in my own way. You have not said you didn;t understand me, so I can only assume you did, thus the purpose of communication was fulfilled.
I can well understand that you might disagree with my characterization - I know that the vast majority of Americans would. But the fact is that a close study of history has led me to my stated conclusion. If you disagree, I'd be happy to hear your reasoning. But I am not willing to write in the way that someone else *prefers* simply because they prefer it. I am not accountable for your preferences, you are.
I do have to say that if we go by your preferences in this case, truth is not well served. "The government is the government, full stop" is just a meaningless tautology. It conveys nothing of relevance that I can see. We could as easily say 'PO is PO, full stop'. What does that do to advance a conversation? It seems more like the goal is to stop the conversation.
If I were to elaborate upon the nature of the State, briefly, I would probably cite Murray Rothbard (who I think is wrong in many points, but right on this one): [emphasis mine]
"The State is almost universally considered an institution of social service. Some theorists venerate the State as the apotheosis of society; others regard it as an amiable, though often inefficient, organization for achieving social ends; but almost all regard it as a necessary means for achieving the goals of mankind, a means to be ranged against the "private sector" and often winning in this competition of resources. With the rise of democracy, the identification of the State with society has been redoubled, until it is common to hear sentiments expressed which violate virtually every tenet of reason and common sense such as, "we are the government." The useful collective term "we" has enabled an ideological camouflage to be thrown over the reality of political life....
We must, therefore, emphasize that "we" are not the government; the government is not "us." The government does not in any accurate sense "represent" the majority of the people. But, even if it did, even if 70 percent of the people decided to murder the remaining 30 percent, this would still be murder and would not be voluntary suicide on the part of the slaughtered minority. No organicist metaphor, no irrelevant bromide that "we are all part of one another," must be permitted to obscure this basic fact.
If, then, the State is not "us," if it is not "the human family" getting together to decide mutual problems, if it is not a lodge meeting or country club, what is it? Briefly, the State is that organization in society which attempts to maintain a monopoly of the use of force and violence in a given territorial area; in particular, it is the only organization in society that obtains its revenue not by voluntary contribution or payment for services rendered but by coercion. While other individuals or institutions obtain their income by production of goods and services and by the peaceful and voluntary sale of these goods and services to others, the State obtains its revenue by the use of compulsion; that is, by the use and the threat of the jailhouse and the bayonet. Having used force and violence to obtain its revenue, the State generally goes on to regulate and dictate the other actions of its individual subjects. One would think that simple observation of all States through history and over the globe would be proof enough of this assertion; but the miasma of myth has lain so long over State activity that elaboration is necessary."
That's just the opening. The rest may be found here.
Perhaps you can see, in light of the above, whence my ethical objections to taxation arise. Perhaps this also allows some illumination into my metaphorical contention.
That said, I am honestly interested in your reference to James Hansen's tax proposal:
Do you have a link which includes more details? As stated, this obviously is incomplete. Upon reviewing the details I may wind up agreeing with you. It's certainly a better approach than denigrating my metaphors and adjectives. :)
I don't think I am forgetting or pretending anything here, Yves. Of course I realize that securing access to resources is in fact the underlying motivation for over a century of war in America, which is one of the most bloodthirsty nations in history. What does that have to do with my point? If we reduce the US governments ability to bomb brown people, we reduce its ability to use those means to secure that access, yes? And likewise, to increase the former is to increase the latter, yes? I don't understand what you are disagreeing with me on here. It seems we are saying the same thing. ??
BTW, if you haven't, you may enjoy reading Randolph Bourne's classic War is the Health of the State. Bourne was a progressive opposed to US involvement in WW1. Here's a good analysis of his arguments.
Oh I think the chances of massive resource warS are very, very high regardless of this or that tax. In fact, both Iraq and Afghanistan (to a lesser degree) were resource wars, so it has already happened. And of course the "anti-war" Obama has expanded the war in Afghanistan, and continued the overall GWOT in Iraq, Somalia, and Pakistan, especially. It's what America does - it's what we know. We haven't really learned any other techniques for getting our way, have we? Perhaps this is because we are still a young nation, relatively. Perhaps it's due to the fact that those who wrote the Constitution explicitly set about to design a mercantilist (aka corporatist) regime which demands resources for its own self-perpetuation. Perhaps it is simply that this current system is far too profitable for the very powerful and wealthy individuals who choose the political leaders in this nation, and far too lucrative for the military-industrial-congressional complex, for wars to be permitted to end. America was 'at war' against the Soviets for 40 years - and as soon as that ended, the first priority was to find another enemy. In a sense, America doesn't know how NOT to be at war anymore. The institutions we have created in war time become self-perpetuating.
The notion that a tax on oil will substantially reduce the chances of such wars reminds me of the story (if you'll excuse a metaphorical story) of the tortoise who allowed the scorpion to ride on his back to cross the river, who, when stung in the middle, as both were drowning, said to the scorpion 'why did you do that? Now we'll both die!' - to which the scorpion replied 'I know - but it's my nature.' That is to say, I disagree with you. But I can't prove you wrong, and I am interested in the specific proposal you favor.
And in fact, this goes back to my Rothbard quote. But I'll go ahead and throw in some George Washington, just for giggles:
"How soon we forget history... Government is not reason. Government is not eloquence. It is force. And, like fire, it is a dangerous servant and a fearful master. Never for a moment should it be left to irresponsible action."
A very fews years after Washington stepped down, the government was left to irresponsible action. And it's never looked back.
Government is predicated upon violence and the threat of violence (full stop) - none moreso than the American government, which is steeped in a history of war, mass murder, torture. Read about US involvement in the Philippines during the Spanish American War sometime, if you are up for a real horror story. Of course there will be resources wars! I for one hope the resources run out quickly, to avert such catastrophes. I think the financial resources are probably likely to dry up first, though.
Let me put it to you this way. I simply do not think that reducing consumption will actually accrue benefits. I lean toward William McDonough's way of looking at things: it is not enough to do 'less bad' - we need, rather, to do 'good.' And I think most taxes wind up, at best, simply doing 'less bad.'
Sorry if this seems to be a political diatribe - of course it is. But in my view, it's relevant, and besides, you asked. ;-)
Ozzy, sorry was quite busy these last days and couldn't find the time to answer, and moreover to tell you the truth, I'm not so much into long intertwined internet forums discussions, so will try to summarize my views (or points below).
Regarding the government and your remarks or approach towards it, I think it comes from the fact that following Arthur Robey comment, I was in a "mindset" of analysing whether such a tax would work in a "system" approach much more than a "moralistic" approach with respect to wwhether the government is good or bad and what it would do with the money. In other words, does the system creates some non intuitive loop holes that will bring results against the initial objectives (and these kind of non intuitive results are not rare). Although I can't really think of any in that case. So yes the point is for me to consider in the analysis the government not as an "immoral" entity but just a-moral.
And regarding your quote in bold, for sure I really don't "subscribe" to this kind of analysis, which does not mean at all that I consider the government as a "socially beneficent entity" by definition. But frankly this kind of quote sounds to me somehow like the tea party movement message. Again, here the point was more to base the analysis on whether it would work or not from a "system" point of view.
And regarding the war aspect, in case of war it becomes the top priority objective for the government in any case, so that I don't think the source of the revenue matters that much.
Regarding Hansen proposal, it comes from his letter to Obama :
"The most effective way to achieve this is a carbon tax (on oil, gas, and coal) at the well-head or port of entry. The tax will then appropriately affect all products and activities that use fossil fuels. The public's near-term, mid-term, and long-term lifestyle choices will be affected by knowledge that the carbon tax rate will be rising. The public will support the tax if it is returned to them, equal shares on a per capita basis (half shares for children up to a maximum of two child-shares per family), deposited monthly in bank accounts."
http://www.grist.org/article/Dear-Barack-and-Michelle/
And what he means is just that : "the revenue of the tax is 100% redistributed" on a per capita basis, so if the revenue of the tax is R for a given month with 1000 citizens, each citizen receives R/1000 at the end of the month. You then have to factor in the family/children aspect, with his proposal of half share per children up to two. Not sure this can even be called a tax, maybe another word should be invented. So in that case it works only by relative differencitation : people consuming less than the average make benefits, the others deficit. But I'm not sure this can really work as the tax should probably be quite high to make a real difference.
However, another key positive aspect that I see in the tax principle (it being partly directly redistributed or not) is that it is fully anonymous : no book keeping required regarding each citizen consumption, and no possible "finger pointing" at "good" or "bad" citizens. This is essential !! (with Hansen proposal : no recording needed at purchase time, and as evererybody receives same amount, no info per citizen required either)
For instance there is (or was) a project in Belgium (and Holland) to set up a tax based on the distance driven that would work with GPS devices recording every citizen car moves :
http://www.time.com/time/health/article/0,8599,1949156,00.html
I find this kind of stuff totally outrageous and really scary "orwell kind". Not to mention the fact that it doesn't differenctiate based on consumption but on distance driven. (and in this precise case, wouldn't be suprised at all that it is pushed by the GPS and system providers lobying for it).
But any kind of "individual carbon quota" would require somekind of "per citizen accounting", and that's why I think taxes should be highly prefered in this context (you can then add somekind of tax cut or something for ambulance taxis or professionals in general).
Finally about : "Let me put it to you this way. I simply do not think that reducing consumption will actually accrue benefits. I lean toward William McDonough's way of looking at things: it is not enough to do 'less bad' - we need, rather, to do 'good.' And I think most taxes wind up, at best, simply doing 'less bad.'
Sorry if this seems to be a political diatribe - of course it is. But in my view, it's relevant, and besides, you asked."
Sorry but I don't understand this at all, and in fact think it is plain wrong, what does "doing good" means in this context ? Sounds a bit too idealistic or "Romantic" to me, and besides, second law of thermodynamics is there anyway. And it is indeed ESSENTIAL, today, to consume LESS, saying "Oh it isn't perfect, so why bother" doesn't really cut it for me. As to doing good, I would see that more in inventing or creating new stuff, being able to design new cities/architecture paradigm for instance, doing good for me is primarily saying the truth, or creating beauty ! (and for sure avoiding wars, and for that yes, consuming less is indeed today highly important)
So what would happen if we just tossed off all governments -- all of them, all order preserving systems and left everyone to their own whims? Forever. I.e. tomorrow, every government ceased to be in power, and NEVER were going to come back. And NO government was ever going to return. Would things be better or worse in the long term: in other words, are governments _necessary_, or not? If necessary, do you think that if we had responsible governments from the beginning and were always that way, that America and the world would overall be way ahead of where they are now and way way ahead of the Middle Ages and Antiquity in both material and nonmaterial ways?
Yes, the recent fuel spike, proves just how lousy price is, as a volume control - and how good the huge wealth transfers that occur from such price movements, are at damaging an economy.
I believe there is a case for a Fuel Excise system but the push here is NOT price as volume control, (as it is a few percent); It is to use the funds, to push a direction change, by more direct action.
Lower registration fees on the most thrifty vehicles, is but one example.
Unlike flawed systems like ETS shams, a Focused Excise design also removes the speculative traders, and fraudsters from the trough.
ETS is worse then useless.
I would argue this point, jg. I think that price is actually an excellent volume control - but only under 'normal' conditions. The body of evidence for this is truly overwhelming. You see it yourself every time you walk into the grocery store or shopping mall, for example. filled with merchandise. If you wish to see the best evidence for it, though, try going to a grocery store in a place where the price system is disallowed - such as the former Soviet Union, where store shelves (at least for the non-elites) were constantly threadbare.
What you have here is one data point which is an outlier, among millions that fit nicely under the bell curve. That's not reason to claim disproof! It is an indication that you need to look more closely at the causes for that outlier.
That is, jumping immediately to the conclusion that the price system is lousy for volume control is to ignore vast amounts of daily empirical evidence that in fact it works extremely well.
You may wish to read I, Pencil, since the implications become more obvious in that context. It's called the 'free market' - not to be confused with 'capitalism' which is another animal entirely. This confusion explains why some commentators mistakenly fault the free market (which doesn't exist) instead of 'capitalism' (which does).
So what we saw wasn't the "failure" of the price system - it was rather abnormal conditions. As in, more than one. As has been widely discussed, one of those was speculation in (non-free) financial markets, which tend to be self-correcting, through - you guessed it - mechanisms like price signals. You can see evidence for this in the case of price controls - such as Nixon imposed on oil in the mid 70s, whereupon we observed fuel shortages manifesting as rationing and lines at the gas station. A predictable effect of ill-conceived market interference.
But the other 'abnormal condition' was what you would expect to see when supplies begin to run low, relative to demand. This is better known as 'peak oil', of course.
The point is that 'markets' didn't fail - but rather accurately indicated a problem with supply. To blame the price system is like blaming the messenger for the message.
To use the example in the essay I linked to earlier - imagine that the graphite in Ceylon begins to run low. Or that the cedar trees used as the basis all get chopped down (or that so many have been chopped down that protection measures severely limiting logging are put in place). Intuitively, then, you realize that, if other sources for these resources cannot be brought online in a hurry, you're going to witness price spikes and shortages in pencils. If people switch to pens, thus reducing demand, then prices go back down.
For an unreasonable guy, you have some great insights. Keep it up!
You are completely out of line here Yves. The argumentive style might fly, but the language won't.
I am not a pure advocate of the 100 MPH at the cliff senario. As a voter in America, I vote, but I am like an atom in a solar system.
Now in terms of Energy Use, one should look at per capita use and compare the US to the EU or Canada, for example.
Taxes should be raised on fuel in the US, but how on God's green earth will that happen. We havent done much in the last two years with a Dem senate majority, dem president, dem house. We will never raise the gasoline tax because it is like someone said above -- a religion in America -- lower taxes spells growth to these zealots even after the performance of Bush II.
We would rather starve the Nation by feeding people beef instead of beans, corn and wheat as the food supply dwindled. So take the taxes off of beef and starve the nation. That is our policy in food terms. LOL
"Now in terms of Energy Use, one should look at per capita use and compare the US to the EU or Canada, for example."
That comparison is in fig 3.8 in the initial message above. And in fact I think Canada is using more oil per capita than the US.
As to who could raise the tax in the US, somehow I don't know why but wouldn't be suprised if a Republican Nixon style or something would manage to do it more easily than a democrat, once peak oil is clearly set in. And one should also not forget that the poor are in fact the first to take the hit with any sales tax.
Nixon. Ironically, Nixon now looks like a great president. He opened China, ended the Vietnam war, and created the EPA. But the Nixon type of Republican is gone. Now the ranks are filled with theocrats have been told for 20 years that cutting taxes is a magical elixir that solves everything. We are in two wars, we run massive deficits, . . . so Tax cuts! I just can't stand it when they call themselves 'fiscal conservatives'. No, a fiscal conservative doesn't create massive deficits. They are fiscal anarchists.
Nixon wouldn't get the Nomination from the 2010 Republican Party. Too Liberal.
Energy policy? What energy policy?
I expect no significant increase in the gas tax anytime soon. The higher the price of oil gets, the less palatable such a tax will be. In fact, there will be a push to eliminate what is there already.
Until capitalism crumbles, America will suck at the teat of free market energy. I suspect that this will last as long as affordable energy. The only hope the rest of the world has to use taxes to manage a shift to renewables and high-efficiency is that the dollar collapses before Ghawar does.
The speed limit reduction to 55 mph was enacted in 1974, during the Gerald Ford administration. You can blame Carter for any number of things, but not the speed limit reduction.
A lot of people Blame carter for the limits to the Oil Supply. LOL. They are doing the same thing with Obama. The US President will seem infinitely weak in the face of a dwindling oil supply.
When are we going to face the facts and speak in complete sentences about the little oil/energy problem we have?
rhetorical question
The 55 m.p.h. speed limit was a good idea. Personally, I would like to go back to the World War II speed limit, 35 m.p.h. BTW, that limit was effective and enforced during WWII. Of course, WW II was also a time of gasoline rationing at 3 gallons per week. 3 gallons a week is considerably more than I use now. Sooner or later we shall have gasoline rationing. My guess is sooner, say four to eight years from now.
Hi, Don
Slower is not necessarily more efficient... imagine the mpg in running 200 hp to move at only 10 mph.
I could be wrong on this, but I believe the most efficient speed for most vehicles is around 50 mph.
On the other hand, if the speed limit were 35 mph, then we wouldn't need all that extra hp, so engines could be reduced in size considerably, thus boosting fuel economy even further.
As for rationing, I just cannot imagine the overwhelming scale of the task. That's not saying I disagree with you in seeing a need for optimizing/allocating available fuel. But rather like agreeing on the need for reducing carbon emissions, that does not mean that what is needed will be achievable.
Hirsch and his colleagues give this issue a pretty thorough examination in their new book.
We are so car-dependent, ration rights would immediately become a second currency, and the bureaucratic requirements would be overwhelming.
All the more reason to take PO and export decline seriously, since our responses are likely to prove inadequate unless we really get moving.
> As for rationing, I just cannot imagine the overwhelming scale of the task.
The US ran a census this year. As well as just executing it, there was all the work involved in planning, set-up, and take-down. All in just a few months.
Did anyone really notice the extra load?
Once rationing was set up, the bureaucracy to run it would be a small fraction of that required for the census. Not overwhelming at all.
During World War II we got along with 3 gallons per week, zero availability of new tires or even rubber for retreads, and the 35 m.p.h. speed limit. Of course in those days we had lots of street cars (As a kid I went all over St. Paul in street cars) and good passenger train service, though trains were often crowded with troops.
Given our suburban and exurban pattern of living--and the lack of street cars and also light rail--it would be hard to get by on 3 gallons per week. But I think it could be done and someday not too many years from now will be done. The initial gasoline ration will probably be about 10 gallons per week, and then as oil imports and domestic production of oil declines, the ration will go down--then a year or two or three--it will go down even more.
I think a modified BAU could be maintained with a ration of 3 gallons/week, but the transition would have to be gradual, over a period of years so as to allow increased production and purchasing of EVs.
While I don't disagree that rationing will at some point become reality (we'll get the military's leftovers), I think the notion that any such program can be setup and administered effectively for very long at all - especially under the kinds of conditions likely to exist - is pure wishful thinking.
Complex societies only scale smoothly in one direction: up. When energy inputs decline permanently (we're not talking 4 years like in WW2 or less than that in the temporary disruptions of the 70s, folks), such societies don't shrink - they break. I really think the level of interdependency upon which we have predicated our society is not being reckoned with here. During WW2 we were nowhere, not even close, to as utterly dependent upon fossil fuels as we are now (and back then, we consumed our own, so we had a lot more control - in the future, Brown's Export Land Model will dominate). The efficiency-based structure of modern industrial society can tolerate very little disruption in energy supplies for long before positive feedback loops come into being, and the whole thing flies apart.
Hate to say it, but I think you guys are dreaming. Good luck on it, though. :)
Just one man's opinion.
During the Great Depression real GDP fell more than 25% in about three years. We survived that. Then came Roosevelt and massive deficit spending plus the New Deal, which helped some.
Every time you bring up FDR I gotta bring up Higgs' refutation of the associated shibboleths:
http://www.independent.org/newsroom/article.asp?id=176
http://www.independent.org/newsroom/article.asp?id=138
Hoover turned a recession into a depression, but it took FDR to make it Great. ;-)
We survived GD1 for a number of reasons, but one thing we did not have to worry about was declining energy flows. We also had a strong manufacturing base, a skilled workforce, a high level of non-financed homeownership, a high savings rate, a very low government debt, and many other advantages. I'm going off the top of my head here, so not 100% sure about all of those, but we were actually about as well positioned as a nation could be to face something like GD1. We're not today. In fact, we are about as poorly positioned as a nation could be to face what's coming. The scamsters and banksters have been running this country into the ground for the last 100 years, and what is coming will dwarf GD1, IMO.
And since energy is the absolute foundation of modern society to an extent most of us cannot even imagine, the fact that it will be declining - probably precipitously, that my friend, will make all the difference, IMO.
I guess I find that, from where I stand, the argument that we'll fall off the cliff (before most of us even know it's there) is a helluva lot easier to make than the argument that we'll manage to stumble down a gentle slope. The primary reason for this is because there is absolutely NO preparation going on at any level but the most micro. We will react when forced to react and not a moment sooner - this is abundantly clear now that so much evidence about PO is available and being broadcast from really credible folks at the political level such as Schlesinger. The fact that it's being totally ignored I take to mean this is intentional - heads firmly planted in the sand (to put it politely :). And we know that reacting to something this big and complex once it is upon us is as effective as taking evasive action AFTER hitting the iceberg, AFTER the tsunami has arrived at the coast. The kind of clear eyed, steely eyed foresight years or decades before the event, and dramatic mitigation action is the only thing which might salvage something from the situation (though I have my doubts) - and it is simply nowhere evident.
For the Great Depression, I think John Maynard Keynes had it nailed. FDR largely followed Keynes's advice rather than the advice of U.S. economists. I think that was a good thing.
Unfortunately, Keynes's work is no help at all (or minimal help) in dealing with Peak Oil and declining production of fossil fuels. Keynes did think it might be feasible to stop economic growth in 2030. See "Economic Possibilities for Our Grandchildren," 1930 by JMK. It has been widely anthologized.
I agree with Ozzy on this one.
Greg,
A census is held every few years and has no value to citizens: in fact, some view it as an intrusion and have no use for it.
Ration entitlements would be like gold, perhaps even more valuable than regular currency.
Instead of staffing requirements being a fraction of that required for a census, I think they would be several times greater.
Consider the level of detail: essential users would first need to be defined, identified, certified, and their certification needs to be counterfeit-proof. The criteria under which essential users were identified needs to stand up to legal challenges by those who fail to qualify,
Government (at all three levels) would need to impose authority on what has always been a private sector operation, and oil companies and their share-holders will certainly object to interference in their opportunity to enjoy a price bonanza.
Please believe me, I certainly see a need for an allocation regime during a major liquid fuel emergency. Most government plans identify about 10 essential sectors, and agri-food is always included.
However, current thinking is that governments should allow "full price pass-through" and not interfere with free-market pricing, even during a major emergency. In other words, farmers would have priority access to fuel, but must pay the emergency prices (which many farmers could not afford).
With net farm income in the USA and Canada (and probably in ANZ as well) at record lows, this strategy will cripple, not support, food supply chains.
Not only would food imports become more expensive, but domestic food production would be constrained by the inability of local family farmers to pay for high-priced fuel.
This is clearly a recipe for trouble (a food crisis on top of a fuel crisis), but this aspect is not accounted for in any liquid fuel emergency plan that I've seen so far.
In short, rationing/allocation makes absolute sense until one considers the detailed practicalities of what is required to achieve it.
None of which brings us any closer to ensuring food supply during a major liquid fuel emergency.....
So what do you think will replace this system after it has all "flown apart"? And will it be better overall (i.e. when you look at more than just "materialism")?
Don Sailorman
I am really shocked you think USA is rich in comparison to China, perhaps you should look at these figures.
http://news.thomasnet.com/IMT/archives/2010/11/weekly-industry-crib-shee...
The trade deficite with China alone was $28 Billion in Septembre, the USA is paying for its unemployment benefit, schools, hospitals ,etc with Chinese money. China alone could buy all US farmland with this money in less than 9 years.
If the countries that the US imports oil from would do the same thing, to secure food for themselves then in less then four years the entire US agricultural land would be held by foreign countries.
It is exactly like seeing someone with a big house, nice car, going on holiday twice a year and calling them rich, but to finance this they have remortgaged twice and got credit card debt which has gone from $15,000 to $35,000 over the last ten years.
http://www.usdebtclock.org/
One day, all these foreigners will want real stuff with their dollars, what will you sell?
US GDP is still three times higher than that of China, and you have had more time to accumulate wealth, so if you and China would participate in an auction, you'd be able to put in the higher bid for most of the stuff, including farmland.
And hey, China gave you goods in exchange for green paper, and you are worried that they might want to use that green paper to get goods from you in the future? Is that such a big problem? You just have to give them a small piece of your enormous consumption pie for a while.
GDP is an illusion with no connection to the real world:
http://mises.org/daily/770
You can't bring a check based on your 'GDP' account to an auction.
Why is it so difficult for people to understand that this nation is beyond broke? We are so used to acting as though we're wealthy, that even in the midst of our accelerating insolvency, people act as though we're the affluent nation we were decades ago. It's delusional.
Further, if PO implies anything, it implies that oil is fast becoming a strategic non-commodity, and will begin to trade on that basis.
"Concave broke" as a friend used to say. (A state beyond that indicated by the idiom "flat broke".)
What !!!
You mean to say we are not the "Greatest Nation" that ever was?
"Exceptionalism" is not our middle name?
That link was quite crazy, you know?
Yes. Very crazy and very interesting to see a right wing nut group expressing very left wing ideas.
I thought this part of it was insightful:
... where (Quantity of Good#1) is exchanged for (Quantity of Good#2)
... by Barterers #1 and #2
... and Price happens to be the Market price at that locale, which price is a number agreed to by Barterers #1 and #2 as the fair value for what they are exchanging.
We can take that crazy idea one step further by saying:
Let Good#1 = N barrels of oil
Let Good#2 = M Euros (or some other currency unit)
The Mises piece goes on to argue that:
[ i.mage.+]
Yet another insight that the Year 2001 think-tanking piece makes is as follows:
Bottom line is that posts such as jeppen's that insist on using GDP as an appropriate measure of 'wealth' or even of 'economic productivity' are totally missing the point. GDP, despite its name, is a measure of consumption. Consumption does not yield wealth - quite the reverse. And consumption is certainly not the causal factor in economic productivity as is widely (if implicitly) held for some unknown reason. It gets things backwards. And GDP also includes government spending, which is dependent on tax revenues and debt, both of which often represent a drag on economic activity. It is in fact this misconception that enables mainstream "economists" to be so badly wrong - because they support measures which increase consumption, and government spending, as though this will somehow magically grow the economy. This approach doesn't even factor in if capital exists in sufficient amounts to facilitate REAL and sustainable economic growth. As one obvious example, this approach views savings as a 'bad thing' for the economy, when in fact savings are the source of real capital which results in real economic activity and growth. This is where Keynes got it fundamentally wrong, in my view, and is a big part of why our current responses to the economic crisis are making things worse not better.
So when we are talking about the ability of the US economy to sustain something like the current levels of economic well being, and on top of that to build toward a different energy infrastructure, GDP is exactly the worst measure to use to gauge that ability, because what matters in such cases is production, not consumption. But I see it happen in post after post here.
BTW, the fact that we see right wing 'nuts' (the only school of economics which consistently got it right in predicting the current crisis and in accurately identifying its causes) spouting left-wing ideas is evidence, I would argue, that it is the left-right paradigm is wholly artificial in today's political context (it was not always this way, remember). I think the ancaps get it wrong in a lot of ways (especially in treating natural resources as a subset of the economy, rather than the economy as a subset of the environment), but in terms of economics, their theories fit the reality of the last century a whole lot better than Keyenesians or Monetarists, both of which schools are unwavering in their support for a central bank, which is the source of the current crisis. And those 'right-wing nuts' are also the most hardcore anti-war, anti-imperialism folks around, while the 'left-wing' is currently busy dropping bombs. Go figure. From an empirical standpoint then, the nuts are the ones with the ideas that map best to reality, it seems.
I actually think Austrian ideas have a lot going for them, but even Austrians have nutty proponents.
Regarding GDP, I'll just quote wikipedia, since I'm a bit lazy:
"GDP can be determined in three ways, all of which should in principle give the same result. They are the product (or output) approach, the income approach, and the expenditure approach."
and on the expenditure approach:
GDP = private consumption + gross investment + government spending + (exports − imports)
So, I'll just point out that investments are in there. I think GDP stats are very useful, but I don't hope to convince you.
If governments put in place the energy and climate policies to which they have committed themselves
That's the most salient portion of the statement. We'd have more oil if it weren't for the tree-huggers and Al Gore.
More like in 3 months equivalent world consumption ? 6 ? 1 year ? Do you have any figure ? read about the new evaluation for Alska reserves ? Really feel like trashing everything for siwx or so monthes ?
My comment was sarcasm.
But that statement is what will be fixated on. Oil prices are going up, but this study by the IAEA indicates that we could have more oil!
I thought your comment must be sarcasm, but I would consider the demand line representing government energy & climate policy commitments are now, to an even larger majority, vacuous -without contents; empty
It seems like everyone is planning on the population in the USA to stay at 300 million for the next 25 to 50 years?
Everything I have read says we are facing an increase to 450 million by 2050 (only 40 years from now). So maybe an additional 80-100 million in the next 25 years.
This report saying the demand in the USA is going to decline over this period is sure BAD NEWS for these 80-100 million new people. They won't be able to buy any gasoline or diesel fuel, can't buy a new house - takes lots of oil to build one, can't fly in any airplanes - takes jet fuel/av gas, ad naseaum -------
Yup, they are going to be a pretty miserable bunch!
> Everything I have read says we are facing an increase to 450 million by 2050
Good point.
Although I think 450 million by 2050 may be a little high, now, especially if the US stays in a slump for a long time. People tend to put off having children.
And if the Tea Partiers get their way, immigration will be cut severely. A protracted slump might do half the job for them: the US will become less attractive to migrants, relative to countries with booming economies.
For the rest of the OECD, the IEA might be taking into account population aging, and the expected retirement of the Baby Boomers over the next two decades. This should cut per-capita oil use, even if the efficiency improvement trend were to stop.
But who knows what's in the IEA's model?
The problem with gasoline is its near monopoly on the domestic transportation market. Compressed Natural Gas is already a viable alternative fuel in Pakistan, India, and Iran. Imagine a fuel source that’s cleaner and cheaper than petrol, and a station for it at every major intersection. The best thing for the fuel market is competition, not between providers of petrol, but between different sources of fuel altogether.
There are also petrol/CNG dual fuel cars. If you find yourself in some small town and can't get CNG you can fill up on petrol, presumably expensive. Back on the highway you find a CNG filling station then proceed home . In contrast to petrol/CNG if I understand it right diesel/CNG must be in a fixed middle ratio like 30%:70%, not the ratio 0%:100% or its reverse.
This happened in a small mining town in Australia last week. The two service stations had no staff in attendance and fuel was self service paid with credit card. Some visitors asked the locals passing by 'where can we get gas?'. The answer was they could get gaseous LPG/propane/Auto-gas or they could get liquid petrol or diesel. The next question was 'sure, but where can we get gas?'. The visitors hadn't noticed the world is changing fast.
So the implications?
As I write this, I just watched 2 ads on the channel CNN...one was for the product of a company long considered as an example of "progressive" design. Honda says they have left those attempting to following them behind, the Honda Accord, they say now has a 271 horsepower V-6 engine.
It should be now recalled that the original Honda Accord, a celebrated and popular car, began life with a 68 horsepower engine.
Then General Motors...with the boast in their ad that they are now building the most powerful towing vehicle in their entire history with their new super duty truck, able to tow 40,000 pound loads.
Welcome to the age of austerity.
RC
Meet George Jetchump,
Jane his wife,
[Continue with flying car music]
[Daughter Judy prepares for next drop off in our cornucopian future world]
[ i.mage.+]
The famous Belgian symbolist and poet Maurice Maeterlinck wrote “At every crossroads on the path that leads to the future, tradition has placed 10,000 men to guard the past.” That quote rings as true today as it did over a century ago. New technologies are arriving in the world at a rapid rate as the world fuses society upon society and borders disappear as the world wide web expands infinitely in an ever expanding universe. As these new technologies arrive from the progressive human consciousness that includes us all large organizations are shaping and editing where they will fit into the larger picture of corporate global expansion and exploitation. The dinosaurs that guard the gates of the past stand to lose possibly billions of dollars if the new technologies affect their bottom-lines negatively. This lesson is true for all fields of human involvement but none more so than the oil industry. The major corporations that pull oil from the ground have had a greater negative impact on the earth than any other industry.
Oil can be attributed as a cause to war, to natural disasters, to global climate change, to smog and pollution, as well as corruption in government and economic policies that have spun the world toward an economic collapse. Imagine what people could be doing with the money they had if they weren't spending a large portion of it weekly on getting to and fro. The money could be spent on other human necessities such as food, clothing, homes, and saving for a better future. If countries weren't fighting each other for oil then militaries would not end up consuming so much of the taxpayers dollars keeping their war machines up and running.
Oil obviously is a necessary part of the current worlds daily routine. It is a necessity. Mainly because corporations have worked so hard to make it so. Progressive ideas in the United States have been squashed so that oil will stay a central part of the U.S. way of life. Take for example the electric car or light rail, wind energy and solar power. All these new technologies lack funding from the federal government mainly because corporate lobbyists from big oil, auto, and steel work so hard to keep the new technologies off the table and away from the public eye.
With that in mind a new technology that could revolutionize the oil industry and make oil more affordable to everyone is on the table. Testing has been taking place in California on a new "Viscoil Technology" that is capable of increasing the yield of distillates from heavy and medium petroleum crude and petroleum crude blends.
The growing shortage of light petroleum crude has proven incredibly costly for refining and resulted in increased costs passed on to consumers. The new Viscoil Technology is the optimum solution to ease the woes of the burdened consumer. Viscoil has developed a proprietary method embodied in a device that is capable of modifying petroleum crude ranging between 12 and 31 API, resulting in a cumulative increase in atmospheric and vacuum distillate of 30%, of up to 50% reduction in residue generation from atmospheric and vacuum petroleum crude distillation, and of up to 50% reduction in pour point and viscosity of the modified petroleum crude as compared to unmodified petroleum crude. This method is known as "Viscoil Technology" and has the U.S. Patent Application number 61/295.225.
If this technology was applied correctly and utilized by the oil industry it could cut the cost of refining heavy crude oil by up to half it's current cost. Thereby saving the average consumer quite a lot of money. This is especially true for third world countries where socio-economic conditions could be stimulated by excess oil revenue. The people of countries such as Equador or Bolivia could benefit greatly from this technology. The new technology could mean better access to education, healthcare, and social programs that mean so much to people who have so little.
Unfortunately as Maurice Maeterlinck wrote " At every crossroads on the path that leads to the future, tradition has placed 10,000 men to guard the past.” The oil industry has no desire to see this new technology implemented. Why would it? This technological advance would cut into their profits and cause them to possibly lower the price they charge for the oil they sell. Which brings to mind a quote by Mahatma Ghandi " Capital as such is not evil. It is it's wrong use that is evil." The dinosaurs that lobby in the halls of Congress have no intention of making less money even if it would serve a greater public good. They have their own interests at heart. They have no intention of helping the U.S. lower it's carbon footprint or pull out of the Middle East. After all would the U.S. really be there if they didn't have oil. The oil industry has helped shaped the misguided U.S. foreign policy that has led to so much death and misery. Oil is sadly the Achilles Heal of the West. Western powers chase it like a drug addict chases his next fix, abandoning principles and morality along the way. All in a quest for that which is as Joseph Heller put it, a Catch 22. The cycle will continue unfortunately.
Thereby an experiment is proposed. Viscoil Technology will watch to see what the oil industry chooses to do over the coming year with the new technology at their disposal. Will they embrace it? Will they ignore it? Will they make it go away? Viscoil is betting they will attempt to make it go away. For utilizing it would thin their already fat wallets. We're curious what others think. Hence, this post. The future is wide open. Let's see what happens.
So, if the oil companies embraced this new technology, then this would enable them to continue their rampage, so to speak?? And, since energy costs would, according to you, drop, doesn't it stand to reason we would use more of it, and thus engender further human and economic damage?
This is a good thing how? Beyond cheaper gas for Hummers, I mean. How exactly would this happen as a result: "The people of countries such as Equador or Bolivia could benefit greatly from this technology"?
Perhaps I am missing something here, but it seems to offer a perpetuation, or even perhaps an intensification, of BAU, which would be most harmful, not helpful, especially to the people and ecoogical systems of the exploited nations, like those you cite.
So what would a sooner, quicker _end_ to BAU and associated "flying apart" of the present world-civilization do in terms of harm to those people?
If we burn carbon, the climate changes and we starve.
If we do not burn carbon we cannot get food to our plates and we starve.
We do not need to burn carbon, we need energy.
There are much more interesting things we can be doing with long chain carbon molecules than burning them.
The issue is where to get the energy in a form that we can use, and in a timely manner before we are incapacitated by famine.
While I am pessimistic in my mind, I am optimistic in my action.
It seems to me that there are only two sources of energy that are of sufficient quantity and quality to enable the continuation of our experiment with scientific rationalism.
Cold Fusion
and
Harvested from L1 and beamed down with microwave.
It seems to me that we will have to subject ourselves to a Darwinian selection process first, before reality imposes these necessities on us.
1. Why do we have to "burn carbon" to get food? For the majority of humanity's history, we didn't "burn carbon" to get food. Rather, we need to "burn carbon" because we have a huge population (going on a whopping 7 billion) and because certain "developed" countries (especially USA) like to guzzle way more calories per person than is needed, used, or will be needed in the future (look at how heavy most Americans are. See those rolls of fat? That's unused calories -- waste.).
2. Nobody's proven cold fusion.
3. How do you propose to build a gigantic mega microwave machine? Esp. considering the loss of oil that is happening fast. Don't they use oil to make rocket fuels?
4. I find this phrase odd:
"It seems to me that we will have to subject ourselves to a Darwinian selection process first, before reality imposes these necessities on us."
Darwinian selection is naturally imposed, it is not something we "subject ourselves to". It just happens. Kind of like gravity.