DrumBeat: December 2, 2007

It's time to face peak oil

Health care is Pittsburgh's economic anchor, employing thousands in hospitals, research units, clinics and related facilities. As goes the medical industry, so goes Pittsburgh.

Medical executives center their attention on "cost, quality and coverage" while considering rising energy prices, especially oil, a minor concern. This is a colossal misjudgment of medicine's dependence on fossil fuels and the fact that the "hydrocarbon era" is entering its final stages.

KazMunaiGaz May Raise Stake in Kashagan to Equal Eni

KazMunaiGaz National Co. said a proposal to raise its stake in the Kashagan venture was accepted by most of its partners, a step toward resolving disputes over developing the world's biggest oil discovery in three decades.

Housing Crisis? Try Mobile McMansions

In fact, though, things are not really, really great in R.V. land. Sales are slipping. Winnebago announced during the show that its revenue was falling for the first time in six years. And the industry association released updated projections indicating that industrywide sales would probably decline 4.8 percent next year compared with 2007.

It’s easy to see why sales are off. With an uncertain economy, tightening credit and gas prices through the roof, many would-be captains of land yachts are rethinking their dreams. Other issues also loom in a world increasingly worried about waste, sustainability and global warming. It might be getting harder to love a beast that gulps a gallon of fuel every seven miles.

Record gas prices on the way

Canadian drivers should brace themselves for record gasoline prices this spring if crude oil stays in the $90-a-barrel range, experts say.

"They could be getting into the $1.30, $1.40, maybe even the $1.50 range per litre," said Jason Toews, one of the founders of GasBuddy.com, a website designed to help motorists find the best deals at the pump.

San Francisco Fleet Is All Biodiesel

Claiming it now has the largest green fleet in the nation, the city of San Francisco this week completed a yearlong project to convert its entire array of diesel vehicles — from ambulances to street sweepers — to biodiesel, a clean-burning and renewable fuel that holds promise for helping to reduce greenhouse gases.

Venezuela sees 2008 oil price near $100 per barrel

Venezuela expects 2008 global oil prices will remain similar to the record prices seen this year, oil minister Rafael Ramirez said on Sunday.

"We expect that the (global) market will maintain the same prices that we have seen this year," Ramirez told reporters.

"Probably, if there is no geopolitical tension like what we have seen recently, prices should be around $100 per barrel," he said. "We believe this shows there have been structural changes in the market."

Nonstop Theft and Bribery Are Staggering Iraq

Jobless men pay $500 bribes to join the police. Families build houses illegally on government land, carwashes steal water from public pipes, and nearly everything the government buys or sells can now be found on the black market.

Painkillers for cancer (from the Ministry of Health) cost $80 for a few capsules; electricity meters (from the Ministry of Electricity) go for $200 each, and even third-grade textbooks (stolen from the Ministry of Education) must be bought at bookstores for three times what schools once charged.

Weird science From the White House

But do, please, pay attention to the ghosts this White House put into the machine. The loyal Bushies have found countless ways of silencing or undercutting researchers whose findings run counter to Bush-Cheney politics. They have manipulated data on food safety, weather, climate change, health, conservation and more.

Oil and gas production have Kansans pumped

Surging crude prices — nearly $100 a barrel on the world market — continue to build interest in modest-producing oil wells that canvass Kansas. Drilling for a nontraditional natural gas — coal bed methane — is booming in southeast Kansas.

Oregon geologist puts hope in mining methane gas

In the wooded hills south of Coos Bay, Steve Pappajohn points to a rich black seam in a cutaway hillside. Coal.

That and a capped well represent his hopes that hundreds of millions of dollars' worth of fuel--not coal, but methane gas--could be deep below, trapped by water in the coal beds.

Sri Lanka's Iranian financed refinery may take five years: official

Sri Lanka's plans to double its refinery capacity, which were dealt a severe blow after politicians fixed fuel prices last August, would take off with Iranian help in 2008, officials said.

More petrol woes for motorists

A temporary fuel shortage is looming ahead of the petrol price hike on Wednesday, with suppliers warning some orders may be short or delivered late.

Companies squeezing power from sun, deserts in Southern California

The plant runs on hot water, pumped from deep underground and flashed into steam to turn turbines. With 10 generators near the lakeshore, the facility produces enough electricity for 255,000 homes, and the company that owns it wants to expand. Other companies are drilling nearby, hoping to build their own geothermal plants.

Govt to reap $5.6b carbon trade windfall

The government stands to reap up to $5.6 billion in extra revenue from the introduction of an emissions trading system, official figures show. And power generating companies could pocket net windfall gains of another $2b during 2010-2015.

The tipping point

We don’t know how fast the change would occur, nor the temperature that could change the biota of the planet.

Are we then at the tipping point, as Ban Ki Moon said? Yes. Despite the uncertainties, we’ve no choice but to accept that we are at the edge of disaster.

Limited Biofuel Feedstock Supply?

The United States has embarked on an ambitious program to develop technology and infrastructure to economically and sustainably produce ethanol from biomass. Corn stover, the above-ground material left in fields after corn grain harvest, has been identified as a primary feedstock. Stover and other crop biomass or residue is frequently referred to as "trash" or a waste, implying it has minimal value.

However, when returned to the land, this carbon-rich material helps control erosion, replenishes soil organic matter, and improves soil quality. Organic matter in the soil retains and recycles nutrients and improves soil structure, aeration, and water exchange characteristics. In addition, organic matter is the energy source for the soil ecosystem.

Africa Looks Toward Biofuels Amid Doubts Over Yields

Jatropha, a shrub used for decades in Africa as a natural fence between crops, has been hyped in the media as a biofuel, but he says it is too early to tell.

"From what I have heard there was very little knowledge about jatropha in terms of the behavior of the plant, the plantation level and so on, how the pests respond, [and] if you grow it at scale," he explained. "So the people we talked to who were actually into jatropha gave us the impression that they were going down this road, they were seeing an opportunity, but they themselves were not quite sure of what the yields would be like."

OPEC would raise output if market needed - Algeria

OPEC would increase output if there would otherwise not be enough oil to satisfy market demand, Algeria's Oil and Mining Minister Chakib Khelil said on Sunday.

"Stocks are high. If there is real demand and not enough supply, we will increase," Khelil told reporters when asked whether OPEC might decide to increase production when it meets at Abu Dhabi on Wednesday.

"It is possible. We will analyse the market and see if there is a real demand," he said, but added: "OPEC is not going to raise output unless there is a need in the market."

State legislator eases into debate

State Rep. Terry Backer, D-Stratford, is passionate about two things - protecting Long Island Sound and weaning the state off its dependency on foreign oil.

Those two passions have made it difficult for Backer to wade into the ongoing debate over building a liquefied natural gas platform in the middle of Long Island Sound.

Oil decline pressing Vermonters now

The United States responded to the 1973 oil crisis in many ways, including gasoline rationing, a 55 mph national speed limit and a year-round daylight-savings time. If oil production really has peaked and is entering a permanent decline, shortages like those of 1973 may be around the corner. How are we prepared to respond?

The short answer is that we aren't, either at the federal or the state level. The U.S. Government Accountability Office concluded in a report earlier this year, "… there is no coordinated federal strategy for reducing uncertainty about the … timing (of peak oil) or mitigating its consequences."

Surfing the ultimate peak

To the surfer’s eye, the drop from Hubbert’s peak on the graph may not look too gnarly, but the relatively sudden reversal from global oil production growth to contraction is likely to produce a potentially devastating economic crisis, with soaring oil prices followed by deep recession. For a surf industry based on hydrocarbons in general and petrochemicals in particular, peak oil could still come to feel like taking a beating at Mavericks.

The limits of 21st-century revolutions

An oil-rich country bent on humbling the United States is an instructive place from which to view the world, so here are eight rules of modern political life as seen from President Hugo Chávez's Venezuela...

HNN Podcast: The Golden Compass & The Geography of Nowhere

Summary: In this month's audio podcast Humanist Network News interviews author Philip Pullman about the religious protest of The Golden Compass, a new film based on his fantasy novel. Also, suburban sprawl critic James Howard Kunstler speaks to HNN about how and why Americans need to re-think the spaces they inhabit.

Africa urged to avoid morning-after oil hangover

Oil-rich countries in Africa must resist the temptation to splurge their revenue from black gold if they want to avoid a hangover when supplies run dry, experts said at a conference in South Africa.

Oil's well despite threat of $100 a barrel price tag

SHOULD we be worried about high oil prices? Two of the worst world recessions in the past 35 years, those of 1973 and 1979, were the result of a sharp leap in the price of oil.

Pakistan: Gap between local oil production and demand surging

The production gap of local refineries is being widened to bridge the thriving demand of petroleum products, surging imports of these products and import bill of the country.

Shanghai in free fall as oil giant plummets

The newly floated oil giant PetroChina has lost a third of a trillion dollars in nominal value in just three weeks, plummeting to a fresh low yesterday as angst gripped the Shanghai stock market.

Oil Scrooge boosts costs for shipping

The same oil price increases that have sent gasoline over $3 a gallon again and heating oil to record highs will make it more expensive this year to mail those dried fruitcakes, loud ties and other holiday gifts.

The 40 percent increase in crude oil prices since August has led to higher fuel surcharges by the major package delivery companies, who said the costs of jet fuel for their planes and diesel fuel for trucks have soared.

Green jobs are the wave of the future

We stand at the cusp of a new clean energy economy. Climate change and peak oil are twin crises that will have tragic and disorienting consequences as they play out. However, solving these crises creates an enormous opportunity, and thousands of jobs will be generated in coming years as our economic and political systems adjust to the new realities.

Iran's use of oil weapon cuts two ways

Oil remains near historic heights. And jittery markets jump at any sign that supplies could grow tighter, spiking at every hint of new tensions over Tehran's nuclear defiance.

But recent increases pale compared with the once-unthinkable levels that could be reached — experts speak of up to $200 a barrel — if Washington and Tehran move toward open conflict.

Won't Support Output Increase - Libya Oil Head

"Libya will not support an increase," head of Libyan oil policy and chief executive of Libya's National Oil Co. Shokri Ghanem told Dow Jones Newswires in an exclusive interview in Qatar's capital Doha.

The oil price is "deteriorating despite the fact that there is a cut in supply in Canada and the winter is starting," Ghanem said.

China, Japan pledge economic cooperation

China and Japan amicably wrapped up their first high-level trade and economic talks on Sunday by pledging greater overall cooperation — but left the touchy issue of gas exploration in the East China Sea unresolved.

Iran starts transporting largest oil platform in Persian Gulf

The offshore transportation of processing platform of Salman oilfield, the largest oil topside in the Persian Gulf, started on Sadra Island, southern Iran.

The Khouf Production Platform (KPP) processing topside, the main one of Salman oil and gas field, and a linking bridge are transferred to Bushehr, southern Iran.

Employee missing after fire breaks out at Twin Cities refinery

An employee was missing after a fire broke out in a fuel oil tank at the Marathon Petroleum Co. refinery in this Twin Cities suburb on Saturday morning, company officials said.

Bali talks to seek global climate deal in 2009

Delegates from about 190 nations gathered in Bali on Sunday to try to build on a "fragile understanding" that the fight against global warming needs to be expanded to all countries with a deal in 2009.

Greetings, fellow Oil Drummers. I haven‘t been reading or posting here for some months, but I would like to briefly post about a conference I attended in London from November 22 to 26 – The International Awards for Liveable Communities ( http://www.livcomawards.com/ ). My apologies, if this is not the appropriate place for such a posting.

Cities and projects compete for bragging rights, but the real point of the annual event is to promote networking and the spread of best practices for making communities of all sizes more liveable and sustainable. The United Nations Environment Programme ( http://www.unep.org/ ) has long had a relationship with LivCom, as the organizers call it, and at this latest conference the UNEP signed a memorandum to make the relationship even closer.

What does this have to do with Peak Oil? I observed 16 one-hour-long presentations by communities ranging in size from 800 to 4.2 million residents, located in a variety of climates – Iceland, Saudi Arabia, southern China, Canada, northern and southern U.S., South Africa, and Europe (Ireland, England, Belgium, Czech Republic, Lithuania). I did not hear or see the phrase Peak Oil in any presentation. Saving energy and minimizing impacts on the local environment were frequently discussed, but Peak Oil was not an issue. A caveat: there were many other presentations of cities and projects that I could not attend, so it is quite possible that Peak Oil was in fact discussed at some point.

As the only person in my community‘s delegation that spoke English freely, I explicitly sought to speak with as many other participants as possible. I took the opportunity to conduct an extremely unscientific poll, asking about awareness of Peak Oil. Those familiar with the subject included a German (who indicated that in his professional circle, it is readily acknowledged that we passed the peak some undetermined time ago), a Swede, a Frenchman, a Canadian (whose community relies on oil-and-gas E&P), and a Saudi (who did not know the term Peak Oil in English, but clearly understood all the concepts on which it is based and their implications). Those unfamiliar with Peak Oil included the Icelanders, the English, the Irish, those from the Czech Republic, the Chinese, and the Americans. The ignorant Americans included two mayors and, interestingly, a vice-president of a major electric utility in the southern U.S.

The six categories according to which cities were judged included: Enhancement of the Landscape, Heritage Management, Environmentally Sensitive Practices, Community Sustainability, Healthy Lifestyles, and Planning for the Future. I suspect most regular participants in TOD would be able to comment intelligently on all of these areas from a Peak Oil perspective. The absence of explicit references to Peak Oil was most interesting, and somewhat disturbing.

On a personal note, I came away from the conference with a heightened sense of responsibility. I have been aware of Peak Oil for 6 years now, but only recently have I felt confident enough to begin to speak with people about it, soberly and proactively. Here in Lithuania, we waste tremendous resources – our multi-resident housing requires 3 times more energy than equivalent housing in Sweden, for example. The mechanisms to change that are already in place: a block of flats (apartments) can be renovated with 50% of expenses paid by the national government, and 10% paid by the municipal government. And yet, in my town of 32,000 residents, only 2 (count ‘em, 2) multi-resident houses have been renovated, and three more are in the process of being renovated. People here argue that pensioners on average receive a pension of only 180 euros a month (that‘s 270 U.S. dollars), so it‘s unreasonable to expect agreement on a renovation that costs anything more than zero. I never bought that argument, and I don‘t buy it now. The key, of course, is to make more renovations happen. I will do my best.

Oh, and how did my community fare? Utena came away with a silver rating. Not bad, for a first try.

I recently sent some links to my immediate family who live in Germany and Brazil to emphasize some of my concerns about what I have been reading here on The Oil Drum, I also sent some information from RealClimate.org abot climate change and some information about about the impending financial crisis here in the USA. Their response was to ignore my requests for a dialog about these issues and to take my information as a personal attack on their lifestyles, I'm talking my mother, two brothers and a sister. I have since found myself to be engaged in serious damage control over my original intent which was to raise awareness and open a dialog over what is happening in the world. If this is the response of my closest loved ones to this kind of attempt at consciousness raising it certainly underscores the difficulty with raising public awareness in general. Let alone effect public policy which by definition goes against the established status quo. Not an easy road ahead for those who see the writing on the wall and want to start the paradigm shift which is necessary. However there are certainly isolated islands of hope in the world. This was posted recently here on the OilDrum http://news.monstersandcritics.com/europe/features/article_1377844.php/D...
Good luck to the courageous few who are doing their best like yourself. Cheers!

Be careful when starting a conversation with foreigners. It is too easy for an american to be perceived as arrogant or hypocrite when talking about energy or pollution.

Remember that colectively you are the biggest polluter in the world, and that both countries have a much more varied energy sector than your.

There is only one option, in my opinion. Reduce personal consumption, and don't make an issue of it. Everyone looks like a hypocrite to someone who has less.

Preaching is not what we need to do.

No one was preaching. The original poster was simply trying to open a dialog - you know, start a conversation. With his family no less.

My own experience trying to start such a conversation was not quite as bad, but also wholly unsuccessful in the end.

My personal experience is that anything I say to my family that they haven't already thought of is preaching.

They are all too educated, I guess

Do you happen to live in the Pacific Northwest ?

Most people I talk to say AHH technology will save us supply and demand.

They think I am crazy for building a system to be self sustaning. But yet when things go sour who are going to call? Ghost busters? I think not.. it will be the crazy one.

Marcos, I was born in Brazil of Hungarian ancestry and am a US citizen. My family is quite a mix of many nationalities so I'm not quite sure what you mean by starting a conversation with foreigners? I don't think that I could easily be categorized as the typical ugly American preaching to those less privileged than myself because they live somewhere other than where I do. Anyways at this point I think these issues are global so we are all in the same boat. BTW the gist of my attempt at opening a dialog was more along the lines of "Are we at the point where we need a backup plan or not?" It didn't go over too well.


Sorry if this sounds insensative, or personally intrusive, so perhaps I should appologies right here. But, I wonder, what was your relationship like with your family before you confronted them with the realities of the world? Perhaps they are reacting not so much to the information you are presenting, but to you personally? Maybe they think, we haven't heard from him for months and suddenly he's sending us this! But of course you know your family beter than I do.

On the other hand you could be, are probably, correct. Are people ready for so much reality, no matter how well meant? Our lifestyles are comfortable and effortless. Do we really want to think about where the electricity, the heat, food, and petrol really come from? Don't most of us just want to flick a switch and enjoy the benefits without recourse to thought? Perhaps we have evolved a thoughtless society? A citizenship based not on engagement, but on the ability to consume. It's not so much "I think, therefore I am" but rather "I consume, therefore I am". If this is true, then we face many challanges ahead.

confronted them with the realities of the world?

There's a lot of good ways to start a conversation about an important matter; "I'm confronting you with the realities of the world" is not one of them.

Not saying the original poster was doing that; just saying communication difficulties can arise on either end, and it's something that can be tricky. It's verrry important not to sound accusatory. (FWIW)

Fair enough, since I posted publicly about my personal life I accept your comments and there is no need to apologize. My relationship with my family is actually quite good and we do communicate quite regularly notwithstanding the impression I may have given. Even my attempt at raising my concerns will most certainly not cause them to disown me completely, granted I may now have the permanent reputation as wacky one, that's all fine. BTW as may be apparent from my comment my family has a more global perspective than most US residents and I could say they are quite worldly and rather well educated. One comment that struck me the most was "what are you talking about there is nothing to indicate a major crisis over here" This was from a sibling who lives in Germany. I asked her to listen to Albert Barlett's lecture about Arithmetic, Population and Energy http://globalpublicmedia.com/lectures/461
I Think you are close to the mark with this comment:"Are people ready for so much reality, no matter how well meant?"
My conclusion is obviously not. Cheers!

Just a quick note - the German relative is living in a country with essentially zero population growth, with active programs to develop alternative energy sources while reducing energy use, where 'bio' (organic) produce is becoming increasingly common in all retail outlets (partially due to Green policies when they were in power), where rail and community transit is efficient and widespread, where towns are walkable, where most people own a bike, after having learned in elementary school how to ride a bike in traffic....

Quite honestly, the list goes on. The German automobile industry may be in for some major problems, along with the German economy in general, but 'crisis' is simply not the right term to apply for a typical German - including the fact that most Germans are very aware of the points you likely raised, in not necessarily in the terms you may have used.

Right I'm quite aware of all that. I was trying to make her aware that the reality in the US is a bit different than what it is in Germany, maybe I was naive but I still think that the US is heading into a crisis situation. BTW She is a native born American raised in Brazil and has lived in Europe for over 20 years. She also travels extensively around the world due to her job.

I still drop references to my family about peak oil and climate change, but in a carefully casual, conversational way.

I am not the one to persuade them of anything -- they are mostly into the typical American middle class lifestyle, and will need experiences and people other than myself to create a teachable moment.

understanding this makes it a bit easier for me to maintain relationships with them.

It sure can be frustrating to communicate information and find yourself completely misunderstood. Often a bit of time and some reassurance on your part that you love and accept them can help to mend any rift.

Even so, it is a burden to be unable to converse about the most important information and analysis that one is aware of with those one loves the most.

yes, beggar....

I have had some success with the slow build up, or the bob and weave.

Mention something that was in the paper, make predictions of gas prices which will turn out to be correct, get the person to think about at their bills; go along with current memes or fashion, implying it is important to act green, without explaining why, etc. If they have kids, ask them if they think their kids will be able to afford a car, etc. At some point, though it has to be tied together, and that either works or not -some ppl are congenital cornucopists or so wired into the technotopia they have diffused whatever they had for brains. And some just don’t give a flying not-doughnut. Don’t hesitate to adopt expert status or a savvy position even if it is dismally lacking. With (some) family and friends, personal status and genuine concern will have more clout than ‘weirdo’ websites.

"what are you talking about there is nothing to indicate a major crisis over here" (magyar at 8.40) The arrogance of some Europeans is insufferable. That is not a criticism of Magyar’s relative as a person (for all the obvious reasons) but merely my kick against an isolationist attitude that ignores ‘new colonialism’, globalization, starving Africa, energy wars, and the ‘real’ numbers. I meet plenty of it and it drives me bananas.

Welcome back Balticman...I raise a glass of Utenos to your conference reporting and efforts in Lithuania...sveikata!!

BTW...My family is going to the Kansas City area's Lithuanians of America Christmas party this afternoon...Father Xmas, dancing (my wife and I are in the folk dancing group), kucios, more food, more drink...the usual when Lithuanians gather.


Congratulations for your efforts ! I would appreciate some of the developments and strategies done by your city and others to enhance livable cities. Perhaps a Guest Post ?

Also, I did not see which Icelandic city presented.

Best Hopes for Livable Cities,


There really is a wealth of real-world, hands-on examples out there. I feel privileged to have been able to attend. The LivCom site has a nice feature -- a quick summary of each day's best presentations. In addition, the presentations themselves were recorded. I haven't checked to see if they are downloadable, yet. If no other Oil Drummer was in attendance, I really should work up at least a brief guest post. I'm certainly not qualified as an urban planning expert, but some of the best-practice examples I saw were thought-provoking and inspiring.

If memory serves, the Icelanders were from a place adjacent to Reykjavik, called Gardabaer (without the Icelandic phonetic marks). After much planning, a community for some 7,000 residents is being built, making clever use of siting to maximize solar exposure and minimize wind exposure, for example.

Oh , come on guys, we are supposed to be your fwends:


US retains right to kidnap British Citizens...

You are either with us or against us - and if that means you are opposed to the kdnapping of British citizens, you are clearly against the U.S.

International law? Who needs it, with its bothersome restrictions against torture? Or invading other nations for resources. Yes, Hugo, that means you - threatening vital American interests by not selling oil to the U.S. the way that the free market intends.

Friends? The U.S. doesn't have friends, it only has pre-emptive targets. After all, the world is a dangerous place when America is only spending 50% of the world's total expenditures on weaponry.

What the Bush administration has been throwing away will never be replaced - and that is something which most Americans are either utterly ignorant about, or gleefully chortling over, as finally, the U.S. is ignoring the opinions of the petty and envious. I'm not sure which group disturbs me more.

Hmmm, sarconol...

The scary thing, though, is that there really are people who think like that. And some of them aren't in government.


Turnabout is fair play, I guess:

During the wars with France (1793 to 1815), the Royal Navy aggressively reclaimed British deserters on board ships of other nations, both by halting and searching merchant ships, and in many cases, by searching American port cities. The Royal Navy did not recognize naturalized American citizenship, treating anyone born a British subject as still "British" — as a result, the Royal Navy impressed over 6,000 sailors who were claimed as American citizens, as well as British subjects. While not directly mentioned as a reason for the declaration of war in the War of 1812, impressment certainly caused serious diplomatic tension and helped to turn American public opinion against Britain.


The "war on terror" is war on all.

And do you know what President Thomas Jefferson's answer to this problem was? The Embargo Act of 1807 - fascinating reading at http://en.wikipedia.org/wiki/Embargo_Act_of_1807

Admittedly, it failed, but then, the author was an objective terrorist in the eyes of the nation doing the impressing, which was just doing whatever it wanted, being the world's leading naval power. And it was all legal according to British law, of course.

The same way, decades later, the Royal Navy began to disrupt American ships sailing from Africa, carrying their freely bought cargoes of slaves. 'The spread of Britain’s web of anti-slavery treaties and the vigilance of the Royal Navy gradually drove one nation after another out of the slave trade, until by 1858 the British squadron was reporting 22 out of 23 slave ships captured as being American.'

Sometimes, it is pretty easy to tell what is civilized and what is not civilized behavior. Legality is often secondary in that distinction.

(Edit - side note for Pitt the Elder - calling Jefferson a terrorist is at least allowable - both for his support of the French Revolution, and because of such quotes as "The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants." Of course, a case can be made that Jefferson was a freedom fighter, not a terrorist, but in the America of today, that is an empty distinction, as one term is generally considered an euphemism for the other in such places as Iraq, Afghanistan, or wherever American military forces are engaged in combat to support democracy.)

An excellent example of cacophemism, calling Jefferson a terrorist. I'd add slave-rapist, too.

No, Jefferson was not a slave-rapist - as slaves were his property, he could do with them as he wished. However, he apparently did commit the crime of miscenegation - which in the commonwealth we both born in, was a crime until until 1967, when the U.S. Supreme Court ruled that a person with one race in their birth certificate could marry another person with another race in their birth certificate.

However, thanks for the new term - but I don't think George III would have any problem at all with my usage, though traitor would likely have been higher on his list of words. I do believe many things are a matter of perspective.

calling Jefferson a terrorist is at least allowable - both for his support of the French Revolution, and because of such quotes as "The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants."

Neither of those demonstrate an intent to sow terror; hence, "terrorism" is not an apt description.

If you want to accuse Jefferson of terrorism, you'd have much better luck trying to tie him to the treatment of the Loyalists, who were simply Americans who remained loyal to the British:

"By July 4, 1776, the patriots controlled virtually all of the territory and population of the 13 states, and demanded that no resident show loyalty to a foreign power. Doing so could result in being tarred and feathered, which often killed the loyalists."

And do you know what President Thomas Jefferson's answer to this problem was? The Embargo Act of 1807....the author was an objective terrorist in the eyes of the nation doing the impressing

Let's take a look at the Act:

"1) American vessels were prohibited from landing in any foreign port unless specifically authorized by the president himself.

2) Trading vessels were now required to post a bond of guarantee equal to the value of both the ship itself and its cargo, in order to insure compliance with the law."

That's a very strange definition of "terrorism" you're using. You could call it "economic warfare", but it's simply ridiculous to equate all forms of force or violence with "terrorism".

I'm sorry about the confusion - the Embargo Act most certainly was not a terrorist answer to a state acting in a lawless way against a weaker state.

The problem is mine - Jesus most certainly was not a terrorist, and quite honestly, the real Pitt the Elder would have been very unlikely to call Jefferson one either. But by that time, Pitt the Elder was a very isolated figure in British politics, and his beliefs about the future of America, and the reasons for the American Revolution, were easily ignored.

The point, which I tried to make very badly, is that Jefferson can be easily fitted into any number of contradictory policies. Though much of Jefferson's writing may seem as revolutionary in today's America as it did at the time of its writing, there are certainly other acts of Jefferson's presidency which would be seen as threatening to America's security in today's perspective - such as Jefferson allowing the Alien and Sedition Acts to lapse during his term in office. I honestly do not expect the PATRIOT Act(s) to expire in my life time, as some of those goals, should as monitoring what citizens read, has been a goal of various government bodies over decades.

However, a quote from Jefferson in terms of the Jacobins -
'In the struggle which was necessary, many guilty persons fell without the forms of trial, and with them some innocent. These I deplore as much as any body, and shall deplore some of them to the day of my death. But I deplore them as I should have done had they fallen in battle. It was necessary to use the arm of the people, a machine not quite so blind as balls and bombs, but blind to a certain degree....The liberty of the whole earth was depending on the issue of the contest, and was ever such a prize won with so little innocent blood? My own affections have been deeply wounded by some of the martyrs to this cause, but rather than it should have failed, I would have seen half the earth desolated. Were there but an Adam and an Eve left in every country, and left free, it would be better than as it now is.'
From http://chnm.gmu.edu/revolution/d/592/

Anyone who supports violent revolution (Gandhi was no more a terrorist than Jesus) is supporting terrorism, if not actively advocating it - because that is how revolutions work, at least until after Jefferson's time. That we paper over that fact does not make it less true. Jefferson, at least rhetorically, was willing to see half the earth desolated in the pursuit of freedom for those who remained, if only one man and one woman. One can be blinded by any ideal.

and all other citizens of all other countries as well. It is often called extraordinary rendition.

I haven't posted for nearly a week, hard to keep up on reading everything here and at Energy Bulletin in articles and threads really and sometimes just nothing comes to mind. Anyway as Russian parliamentary elections are today and tensions are increasinga nd relationships with the west are not particularly good and in light of my WWIII speculation posts from last week I would like to add some historical correlations to explain waht I think has brought about the current situation between Russia and The West.

I once read a book about the negotiations for peace after WWI and Clemenceau was an embittered old man who wanted revenge on Germany for everything, Franco-Prussian war, etc. So in the end impossible reparations were imposed and control over Rheinland which all led to very bad blood and the forced hyperinflation to get rid of the debts leading to WWII. the lesson being quite clear, hate brings hate, a spiral of violence ensues. Anyway the US learnt from this mistake and took a fair hand after the war, live and let live attiutde let democracy flourish. Forgiveness brings peace.

The attitude after the end of the cold war was in the public generally presumed to have been that following WWII which would have promoted a long lasting peace and true democracy in Russia instead of the managed democracy intended to inhibit undue foreign influece(total takeover of everything by straw men or directly). Instead we have had vulture type aggressive attitude on the part of US interests like PNAC, corporations trying to control everything by way of semicriminal supperrich (khodorkovsky, et. al.) and by fomenting color revolutions everywhere. Luckily for the USA Yeltsin was an easily manipulated alcoholic with a big ego so it all worked out fine at first.

Of course then Putin came and he is one fine KGB agent with experience abroad, bilingual, physically and psychologically fit and stable with a masterful control of politics through his expereince in the early Russian democracy in St.Petersburg. At first he was ok with Washington in post 9/11 situation but learned gradually how cynical Bush/Cheney neoimperialsits really were. Frankly speaking he would never had been so popular without such high oil prices allowing stable finances in Russia and general prosperity.

So a general comparison to the interwar(1919-1939) period could be made with a lost war (WWI/cold war)then an unstable democracy followed by a managed democracy (Weimar Republic/Hitler => Yeltsin/Putin) leading into a direct war between the two superpowers over strategic interests just like WWII. The instability of the 20 year interwar period with a 10 year global depression with lots of politcal maneuvering in Europe is fairly similar to now(subprime/PO credit crisis depression presumed to start soon?) with lots of bad blood between the former enemies (US/Russia) just as between earlier enemies(Russia/France/Germany).

On the Asian side the Japanese wanted in on the imperial game that the Europeans had started had started with their expansion in Manchuria in the 20s which just kept growing. The Chinese are now the expansionist power in Asia and we can only imagine how that will go. They are verywhere in Africa, Asustralia, Canada, USA, etc. trying to buy up resources and control things generally. Taiwan is still unresolved.

There are just too many parallels to the two interwar periods. The Japanese have shown too little remorse to the Chinese of ocurse but the Americans are the real problem on that side as well.

As Russia and China are continental powers it can be presumed that in the case of a war against the West they will not be hindered in connecting with one another for direct economic and military assistance as Japan and Germany were in WWII but if they win and take the oil prize in the gulf then who will be the junior partner? Will Russia be looking down the end of the gun barrel and thinking of the bad years under the Khans?

Galacticsurfer, dude, you are one cheery optimist aren't you?

Hi Galacticsurfer,

The best thing I read about Putin and Russia's relationship with the west can be found in 'Losing Russia' by Dimitri Simes in the current Nov/Dec edition of Foreign Affairs. A summary is available at www.foreignaffairs.org

Basically the US and Europe screwed up through arrogance and ignorance. The Russian response has been quite reasonable in comparison. All the talk in the media is unhelpful and ill informed. Like they want to ring fence Russia but not it's gas and oil exports - duh.

Politicians everywhere basically don't know what they are doing, and that's true of China and Japan as the US. What are they trying to do, bury their best customers? If the US can't fund its trade deficit then China WILL lose it's surplus.

Take all the countries with a current account surplus (China, Japan, OPEC middle east etc.). Then take all the countries with a current account deficit (US, UK, Australia etc.). The two totals MUST balance. It's also why I dismiss talk of oil at $350/bbl or whatever. It's unaffordable, period.

Hi Galactic surfer, it's true that the western criticism of Putin has been self-absorbed and blindered. What after all has Putin said apart from that the U.S. is trying to get its way around the world absent consideration of diverging opinion?

But I think that's just part of the picture (and one that Simes misses in the piece that alanisthename cites).

It's nothing nefarious: Putin is following the long-lectured mantra of market economics. He's seeking Russia's best interests abroad, and that means increasing Gazprom's oil and natural gas foothold in Europe, and tying up the energy supplies of Central Asia.

But are these dual aims in America's best market interests? I'd say they are incompatible -- it's better for the U.S., given its stake in maintaining its European alliances, to ensure that there's a diversified energy supply in Europe.

So, putting aside America's and Putin's grandstanding on energy, Iran and so on, it seems to me that there actually is a market case to be made for hemming in Russia's energy strategy.

Steve LeVine, author
The Oil and the Glory

Again when I realized that what I was saying was so then it seemed so obvoius, as if I had looked for my glasses evrywhere but they were on my face.

I believe problems ar e made by people willfully. We choose to make solutions as well. wars do not just happen. A win win strategy can e chosen and created by all sides like after WWII or a lose lose strategy like after WWI. PO dieioff is not fate anymore than WWIII or anything else. We choose our fate freely as a society. Unfortunately it seems that the book Generations and 4th Turning have more to them than just a nice cover. They are predictable of human societal patterns only I could just not perceive how that exactly jived with our current phase of history until today.

You are predicting war with Russia?


In the sense of the books Generations amd 4th Turning by Strauss and Howe I am suggeting a strong parallel between the 1919-1939 period and the current period as interwar periods, exchanging the combatants Grmany/France for Russia/USA. Societies and types of generations create the mood (mistrust/hate)for a war. Your book obviously concetrates on specific geopolitical objects and area and actors(oil/caucasus/CIA and Cheney/Bush administration)but missing the mood of the times as the ultimate driving force (WWII impossible in swinging 60s, etc.) which completes or makes the big picture. In other words I have to have this big picture first and foremost then everything else just falls into place. Like with Newton or Einstein finding that big idea that just changed everything. Strauss and Howe have that. I am presuming some sort of conflict between the global powers is pretty much inevitable now as the players(the mass of public opinions/moods in all major countries which are the true drivers ofpublic policies, not background players pulling strings) are all there and the attitudes are fixed. With the coming economic and resource crises coming into this antagonistic and fearful public mood then global conflict is practically unavoidable but the 1930s was all about that too and it lasted a long time till the war got started and everyone kept thinking they could prevent it, just like with the current stock market crash that just never happens but as Roubini predicts, must happen.

For example you say in above posting that there is a market case for hemming in Russian energy supply to Europe so Europe gets a diversified supply.

This is an attitude towards the thing that is logical and rational within the current framework and as one of our poster used till recently as a byline from Einstein "you can't solve a problem at the level at which it is created". This is not good enough. A market appraoch is what got us into this mess. Obviously the insistence of the frecnh on reparations from Germany was rational and logical but behind that logic was the feeling of revenge. Forgiveness would have solved the problem. If USA/Europe/Russia/China,etc. were actually willing to give up short term self interest then a solution for global energy problems could be reached but we see from the attitude of current leadership that anything but that is on their minds and that this is typical of the population at large,pure short term selfish interest is foremost. Now I am not trying to preach it just sounds like that. Obviously after a crisis war when everybody has sufferd so much that hatred is just a sick joke (CIVIL WAR USA/WWII) can people really think of true rational self interest which includes looking at what everybody needs (including former enemies) and making a set of rules to allow so that such conflict does not recur anytime soon. This was the idea behind the postwar peace UN/Marshall plan, etc. The current situation reminds very much of the 20s/30s, with a wounded (cold)war loser being battered by rich western countries full of general hatred and disdain, looking for every opportunity to hit a man who is already down and a society fixated on quick riches. Putin, similar to Hitler stabilizes the chaotic country and encapsulates it against the destabilizing foreign influence and strengthens its military and economy and has additionally endless strategic thought on how to move against The West when opportunity arises out of spite and revenge just as the west has reacted all these years. This is not rational or logical but an emotional response and must be recognized as such. "The Market " or any other technical explanation does not begin to describe such matters or why war or genocide actually occur.

I made ten business trips to Russia from 1995-2000, working on the International Space Station. I enjoyed working with the Russians there, and made several good friends. The U.S. and Russia still cooperate closely every day on the space station, which has a mixed Russian/American crew.

I do see the analogy between Russia today and Germany in the aftermath of World War 1, but it's not a perfect analogy. Certainly Russia of all people does not need "lebensraum" (living room), and Russia does not show anything like the kind of anti-semitism that was current in Nazi Germany.

I'm hopeful we can avoid a war with Russia, though it is concerning that they seem to be moving back in an authoritarian direction. We've never fought a direct war with the Russians, despite being geopolitical opponents for much of our history. Cooperative Russian-American efforts like the space program may be a help in achieving a positive end.

Personally individuals andocmpanies have good relations but the big picture does not look so good because strategic national interests are in conflict.

If we get a 1930s style global depression due to credit crisis and PO then friendliness will be over and the national interests will dictate conflict.

We all know the old saw "History doesn't repeat itself but it sure rhymes" so I don't think we need a perfect repeat to get the picture here, it just has to rhyme.

Basically the US and Europe screwed up through arrogance and ignorance. The Russian response has been quite reasonable in comparison. All the talk in the media is unhelpful and ill informed. Like they want to ring fence Russia but not it's gas and oil exports - duh. by alanisthename:


Sums it up. After the fall of the Berlin wall and then 9/11 Russia, under Putin, seemed to latch into the terrorist meme (all that seeing into souls between Bush and Pooty-Poot) which Putin thought might help him in ‘his’ ‘territories’ (eg. Chechnya) but that proved to be short lived: ie. false flag terrorism was not to become a shared arm of ‘elected governments,’ a means of control for all the powerful; occasions for agreement.

Oh No! Only for the US (and israel.)

That Putin should consolidate Russia politically, reverse Yeltsin’s drunken fire sales, curb or eliminate the oligarchs (eg Khodorkovsky, who broke the non political interference pact he made with Putin in 01) and generally revert to a nationalist stance was considered creepy, disgusting! How dare he (gasp.)

So the upshot is kind of Cold War bis., fought along more feeble lines, color revolutions and the like; these only make treackly little inroads along the edges.

Not war. Just as in the past, neither party can afford it.


If only we could surf the galaxy, now that would be fun, it's a shame it's just a dream, though an attractive one.

Anyway, I agree with many of your points, but not all. I don't so much think your wrong, but perhaps the weight you give to certain aspects of your agruments are misplaced. This is a massively complex and controversial area, so this isn't a definitive historical analysis, just a few tentative comments.

Re. WW1. I think you substantially underestimate the benefits the United States acheived by entering the war and tipping the balance against the German military block. Germany might well have won the war if the United States had remained "neutral", but it never was neutral, it supported Britain against Germany. It did this not so much because of any particular love of the British Empire, but more because it wished to stop Germany becoming the dominant power in Europe and a potential rival to United States, in this respect American and British interests coincided.

The American President, Wilson, vowed to keep America out of the war and won an election on this ticket, but reversed his policy and against heavy opposition entered the war on Britain's side, but to serve American interests. Wilson's post-war policies are nearly always portrayed as being idealistic, his emphasis on the rights of ethnic minorities and national independence... However, one can ask oneself, who did these policies benefit? Can one see this Wilsonian idealism in another light? Instead of Europe being forcibly united with Germany at its head, a continent with vast potential, joining Germany's industrial strength to the markets and raw materials of the older empires of France and Britain, an integrated Europe; the opposite took place. Instead of the United States of Europe, we saw the "balkanization of Europe", the weakening of Europe, Europe in economic crisis and on the path to another war over Germany's role. Was this all really an accident? No, if one looks at contemporary sources and much that was written post WW1, there is massive criticism of the Wilsonian strategy. What, it was argued, would happen if one supported national self-determination for Europe's ethnic minorities? Didn't one risk chaos? Who was to decide where the borders would go? Who was to decide which ethnic groups were entitled to their own country?

Letting all these ethnic groups loose on each other may have been a ver bad idea, releasing the ethnic/nationalist geni out of the bottle. We're still living with the consequences of all this. Look at the Balkans now. Why does every ethnic group/tribe have the right to a "country" of their own? If that was applied to Europe the map would look like a patchwork quilt. A very weak and easily controlled quilt.

Well. Putin the Great's electoral results are coming in. 62%

- I wonder if any other presidents of major states would like that kind of endorsement...


Now , who wouldnt vote for a President who puts his nation first, wants a strong currency and a strong defence, oil under national control, and kicks neo con 'economic' and 'democratic' policy into the trash can:

(shorthand: let Exxon, Shell and BP in to steal all your oil at knock-down prices or we will accuse you of not being 'democratic').

Lets face it, USA and Europe , - esp UK, blew the end of the cold war.

Biggest chance in the last 1000 years to get a decent relationship with Russia going and we blew it because of the Chicago skool of Economics....

...The economic equivalent of the Teutonic Knights.

in the last 1000 years to get a decent relationship with Russia going

One of the 'all the money is controlled by X' sites make a pitch how Czarist Russia was one of the last large states to have their own state money and thus sent money to the US of A back when the US had trouble.

If their analysis of history/money flow was true, it looked like there was once a time when there was a 'decent relationship'. But like an onion - I'm rather sure that any money sent from Russia to the US of A was but one layer - with other motivations on the outside and under that one layer.

In the previous 5 years until the catastrophe of 1914, the Russian economy was growing at 17% pa. - Admittedly from a lower base than the US.

The British Empire effectively 'peaked' in 1905.

Russia has been in the deep freezer for 90 years. Well, She is out now.

What a shame we decided to send in management consultants in the 90's.

What a shame we decided to send in management consultants in the 90's.

The 'look at all things through the lens of oil' says it was not a shame - it was an attempt to get control of the oil/gas. And it worked, for a while.

Like so much - it works for a while.

The management consultants encouraged asset stripping, BS and ideological hype. It worked for a while as the leaders were drunken louts (Yeltsin) or gone missing (Gorby) and there was at that time no functioning State structure.

Europe dares not join Russia because of US domination and NATO. From a purely strategic pov., that makes them fools. From a moral pov, low-lying lackeys with no scruples.

I think Russian voters are behaving rationally given the choices they are allowed, but they are very poor choices. Because liberty has never done a damn thing for them, they can openly embrace an authoritarian leader over American-backed Uncle Toms like Kasparov.

Little by little, real choices are being taken away from citizens all over the world, whether by the Anglo-American-Israeli faction and its majority of the global capitalist elite, or by the Russo-Chinese-Iranian-Latin American faction and its still-patriotic, unglobalized regional tycoons.

It's just the runup to the final crisis of capitalism, the finals of a tournament that destroys the world it is meant to conquer.

Instead we have had vulture type aggressive attitude on the part of US interests like PNAC, corporations trying to control everything by way of semicriminal supperrich (khodorkovsky, et. al.) and by fomenting color revolutions everywhere.

It is interesting to see the Russian plunge into corporatocracy through different eyes. In 'The Shock Doctrine', Naomi Klein makes a convincing case for Russia being one of many victims of the IMF/WorldBank juggernaut of capitalist shock doctrine. Along with Chavez and others in South America, Russia is beginning to be another case of severe blowback from these predatory corporate policies. Nationalism rears its head again. Hard to guess which is worse, the 'New World Order' or 1984 type perpetual war.

For all the bad things I was saying about Americans under Bush Senior, I think there was the possibility of mobilizing good will among Americans for Fair Play For Russia in 1990. Just nobody among America's elites bothered.

Was that because our elites always intended to rape a defeated Soviet Union and had to supress memories of the Marshall Plan?

Or was it because our elites are so stupid, shallow and self-absorbed that they could not be bothered to crack open a history book?

I think the answer is to be found in how the US handled its two victories over a mini-USSR, Saddam Hussein's Iraq. Under Bush Senior, we were willing to let Iraq work itself out under the burden of our sanctions. Under Bush Junior, the neocons loudly proclaimed that we would benevolently remake Iraq in our image, "just like we did Germany and Japan!"

How can you tell a neocon is lying? Movement is detected between his nose and chin.

You've probably heard of Naomi Klein's brutal article on the Occupation's hyper-capitalist plan to rape Iraq, "Baghdad Year Zero":

pdf file - www.harpers.org/BaghdadYearZero.html

This article implies that the neocons DID crack open a history book, found the FDR/Truman version of occupation too pinko to countenance, and then implemented the economic opposite. But in 1990 they lacked the power to be so blatant in Russia, and James Baker led the carpetbaggers in to make a quick killing and hope for the best.

Putin's early mistake was simply that he assumed America was run by Bush Senior-style corporate cynics, not Bush Junior-style madmen. He never had any illusions about our goodness.

We must ask the question whether the liberality of the US occupation of Germany and Japan would have been different if not for the Cold War. Germany was the home of Marx, and Japan had Communist labor unions. But 45 years later, we could do whatever we pleased to Russia without an outside Communist power fomenting new trouble.


It's an interesting point about whether the nature of the occupation would have been harsher but for the "threat" posed by the Soviet Union. Some of the plans Churchill aired about what he had in mind for Germany were a tad extreme to say the least, in some respects remarkably similar to what occured in Iraq, and they might possibly have had similar results.

One can also ask the broader question, whether the liberality of Western elites in relation to their own people would have been different if not for the Cold War and the existance of a rival socio/economic model? One could argue that the liberal, Western, welfare state model, in its various forms, was a response to the threat to the social order posed by Socialism, going right the way back to Bismarck and his social reforms designed to undermine the prospect of social disruption or worse.

Does this mean that, minus the Russian socialist threat, the Western, reform, welfare state, will also whither away and die? So maybe we've got the Russian Revolution to thank for our comfort and prosperity?

Hi Super390, one problem with going in and "rescuing" the Soviet Union was that, unlike Germany and Japan, Moscow as not an enemy defeated on the battlefield. It lost the Cold War, but the West was simply not in an analogous place (cities devastated, mass death, dead leader) to dictate the peace; many Russians to this day indeed believe that THEY were partners as winners of the Cold War because they went peacefully.

Because of this, no program similar to George Marshall's could have been enacted (and in fact was never seriously considered).

The U.S. was short-sighted. It sought big oil deals. It sought Russian capitulation on whatever policy the U.S. sought at any given moment.

And Russia and Russians were humiliated by the situation.

To circle back -- when you don't have an indisputably defeated enemy, it's mighty hard to institute a Marshall-type plan that would work. And I think that one wouldn't have.

Which leads to a certain sense of inevitability about Russia's 15-year transition (pretty fast) from a prostate country to an assertive one with a steep trajectory.

Russia is traditionally chin-out. Putin is in a long line of such leaders -- autocratic, menacing in tone, xenophobic at home, and jealous of his own prerogatives. But, while jailing opponents and worse, he is also seeking market advantage with his oil policy. He's a shrewd player.

As for rigged elections -- does anyone know of an honest one yet in the 12 CIS countries? I think that nly in Ukraine and Georgia can one expect a reasonably straight outcome.


Hi Steve,

I think looking at the situation quasi biologically we can take America as an intrusive agent from the normal historical situation which has disturbed what would have otherwise have happened in History(as discussed in the thread for example regards WWI and WWII) . Essentially the American history is that of an expanding cancerous cell with an expansion pulsing of generally 80-100 years as described in Strauss and Howe’s book Generations. First the colonies expanded to take over in 250 years North America forcing Indians then France(French and Indian wars), Britain(Revolutionary War, War of 1812) and then Spain from their borders(Mexican War, Spanish-American War) while uniting themselves in the American Civil War along the way. The expansion has not stopped with expelling foreign influences in Western Europe and their transplants on the American Continent but continued in the two world wars in taking a deciding influence and then the commanding heights of global dominance. The Europeans were forced from their colonies abroad by American anticolonial idealistic principles and the colonies were then fair game for American “free market” influences as opposed to managed European colonial “mercantilist” influences. The only thing left was to conquer Russia and China. The end of the cold war was proclaimed by Fukuyama as “The End of History” just in this sense as I think that the American Manifest Destiny in sense of empire and political and economic system had presumably won at last. As we now know and as Fukuyama (a former leading Neocon) himself admitted this was a mistaken assumption. When the cancer dominates it usually kills the patient. If the American imperialistic expansionist materialism is akin to a biological cancer is not this the reason for our modern problems, acceptance of such an expansionistic materialistic system?

I think that we have to get WWIII because American expansionism has to be taken to its logical conclusion of total global domination. Since we are at TOD we can speak here in terms of energy and we can see that the settlers burnt all the wood and used up the top soil, then found oil and coal in huge amounts and used all these resources to expand their power and when oil declined started importing from the Arabs. Competition from Asia and Russia for control of Arab/African/Latin American oil and other resources will be the war catalyst. Catabolic collapse might happen before USA manages to take over the world as the Chinese and Russians could have more oil and coal and manpower and top soil to be able to withstand an all out assault from the USA and their presumed allies in UK, Canada, New Zealand, Australia, with uncertain levels of support or neutrality from Japan and Western Europe for either side.

Regarding the inevitability of the developments since the cold war obviously the Chinese did it differently having a gradual devolution of power to market forces while maintaining one-party rule to ensure military, political and critical resource control. They managed in this way to become a regional and perhaps soon a global superpower. Perhaps Gorbachev could have done similar and used the money to finance a Marshall Plan for them as the Chinese have done for themselves. Unfortunately the Russians had no massive amount of farmers to work making cheap goods, being on a different population trajectory and having a highly educated population. All they can export is weapons, software and natural resources. Of course the oil price rise did a similar service for Russia recently.

Obviously Putin is a standard Russian product and no nut case with a glowing wish for global dominance like Hitler. Russia attacks when it has no choice (Mongols, Turkey, Sweden, Napoleon, Hitler). It is very defensive but quite paranoid. Russia took large swaths of Central Asia and Siberia for itself as they were relatively easy to take and undeveloped, like the European colonial conquests. America can however provoke now much too much like Britain in their endless ambition and self overestimation in “the Great Game”. The cold war was obviously only Round one for USA/Russia Game.

I don’t think you can just say that history is a simple repetition but the cyclical history theories deserve serious consideration. Obviously massive differences exist in the mindset between Bush Sr. and Bush Jr. due to their early childhood and early adulthood experiences and these experiences can be generalized to the populace as a whole(GI generation, Baby Boomers) to show predictive general mass behaviours. The current bubble manias in Tech stocks and housing are very similar to the 20s bubbles for example.

Totally bizarre. I think maybe right on, but its bizarre to see it laid out in a few tidy paragraphs.

Could someone just give a quick run down as to the liquid types that the EIA incorporate within their 86 mbpd recorded output?

With BP statistical review 2007 recording a 1645gb global reserve excluding tar sands, what type of resource do they calculate as reserves to reach this number?

Just for a small project I am doing but would sincerely appreciate some brief knowledgeable input. Thanks.

Sangiovese, the EIA has never recorded a month with 86 mb/d. You are perhaps thinking of the IEA. The EIA is always two to three month behind in its reporting, making them far more accurate than the un-revised IEA figures. The highest EIA numbers, so far for All Liquids, was July of 06 which recorded 85.467 mb/d.

But you can go to their "All Liquids" spreadsheet and get the figures and definitions:

There you will find this definition of "Oil Supply":

1 "Oil Supply" is defined as the production of crude oil (including lease condensate), natural gas plant liquids, and other liquids, and refinery processing gain (loss). For definitions of these terms see: http://www.eia.doe.gov/emeu/ipsr/appc.html

And at that link you will find this definition of "Other Liquids:

Other Liquids: Ethanol, liquids produced from coal and oil shale, non-oil inputs to methyl tertiary butyl ether (MTBE), Orimulsion, and other hydrocarbons.

Someone else will have to answer your BP question. I have no idea how they arrive at that number.

Ron Patterson

Thanks Ron, appreciate your input. The 86 mpd was the rounded figure, not being too specific. Great help.

The EIA is always two to three month behind in its reporting, making them far more accurate than the un-revised IEA figures.

Based on what evidence do you say that?

I'm not saying you're wrong; I just don't know of any way that you could know what the "true" value is to compare and determine which one is closed.

In terms of the volatility of the initial predictions, the IEA offers three estimates for each month's production - the initial one, and then revisions one and two months later. For global production in the months this year that have seen all three estimates - i.e., Jan-Aug - the mean revision between initial and final estimate was tiny (-0.015Mb/d, IIRC). Since the change in the data over three months is so tiny, it seems unlikely that the EIA has access to substantially better data by waiting until that third month to publish.

The IEA reports come out two weeks or less after the close of the month, long before the most countries report their actual production. They are just guesses. The EIA reports come out well after most nations have reported their production.

Now I ask you Pitt, which would be more accurate, very early guesses or much later actual collected data?

I know the IEA revises their data the next month but the figures everyone is quoting now is not a revision, it is just an early guess!

Ron Patterson

I know the IEA revises their data the next month but the figures everyone is quoting now is not a revision, it is just an early guess!

And, by and large, a good guess. The level of revisions to initial IEA figures is fairly low, even two months later (after the EIA numbers are out).

Of the eight months this year for which they've completed their data series (Jan-Aug), the average error in their first estimate was that it was 0.016Mb/d too low, and the maximum error magnitude seen was 0.23Mb/d, with a mean error magnitude of 0.12Mb/d.

Revisions of 0.2Mb/d or more are certainly possible, meaning that there is some chance a revision will dethrone last month as the current peak. I hope not, simply because I think a recent peak month makes it much more likely people will stop obsessing about "the peak" and spend their energy a little more wisely.

The following post appeared on a UK blog today. I wonder whether any of you here with knowledge of this situation could offer any thoughts. Is this potentially as serious as it sounds?


Having just received 2 warnings that he might not be able to get hold of even half the amount of fertilizer he normally uses - from his usual suppliers, my Uncle phoned me in a total panic this morning.

This news hasn't made it into the mainstream media, probably because of general ignorance. However, there is a real crisis brewing that could result in yields plunging right around the world next year.

Don't forget, many farmers quite simply do not know how to farm without fertilizer. Organic farming techniques, such as using clover to fix nitrogen and improve fertility, have been taken up by some non-organic farmers, but this take-up is far from universal.

Even if these organic techniques are quickly adopted because of the fertiliser crisis, yields will still fall significantly.

I should also add that next year's fertilizer shortage will also increase fertilizer prices still further.

Blimey, even I'm worried about this - and I have access to my own private food supply via parents, uncles, etc., if I need it.

There's a link posted to a Nov 28 article in the UK Farmers Guardian:

Fertiliser at a price – if you can get it

A LOGISTICAL supply problem with fertilisers in spring 2008 is now a reality not a possibility, say fertiliser companies.

World demand is outstripping supply and farmers are being advised not only to make sure they have ordered what they need, but to take delivery and make sure they have it.

"This coming season, the most likely situation is a shortage," said Yara’s England and Wales business manager Steven Chisholm.

World demand for grain production for both feed and biofuel was currently outstripping supply and that was driving the demand for fertilisers.

"All I would say is order it and get it delivered – ownership will be nine tenths of the law this spring."

At GrowHow UK, the recently formed Kemira/Terra joint venture operation, marketing manager Ken Bowler said we were living in “unprecedented times" as far as the fertiliser market was concerned.

"We are sold forward for a few months now and are not actually offering product at the moment but we will re-issue prices when we have a better fix on the situation," he said.

If memory serves, Richard Duncan predicted that the worldwide net dieoff would start in 2008.

For the benefit of any new readers:

The ELP Plan: Economize; Localize & Produce
MONDAY, APRIL 02, 2007
By: Jeffrey J. Brown

In this article I will further expound on my reasoning behind the ELP plan, otherwise known as “Cut thy spending and get thee to the non-discretionary side of the economy.”

. . . I would especially recommend that you consider buying, perhaps with a joint venture group, a small farm, either currently organic, or that can be converted to an organic farm. In the short term, if nothing else you could lease it out to an organic farmer. Longer term, you might consider building or moving a prefab, small energy efficient house to the farm. If nothing else, this plan may provide a place of work for your unemployed college graduate. . . .

Westexas it will only get worse if there is indeed global cooling coming around he corner with the solar cycles. Happy Happy Joy Joy

May as well say we are all going into extremely rough times.

I am doing my aquaponics I figure thats about as close as I can get to having a farm on my little mcmansion lot. I do not see really any great alternatives to people who live in small plots of land. However I do think Aquaponics in a realy good way. It is able to grow the food in less than optimal areas and using fertilizers is a non issue here. The fish provide fertilizer.

"global cooling coming around he corner with the solar cycles."

Be careful Slicerdicer. That goes against the conventional AGW religion. You may be declared a 'heritic' or worse yet, an AGW "Denier" (lol).

Slicerdicer may be called an AGW "denier" if he can't back up his statement about global cooling due to "the solar cycle". And, how for away is that corner? If he is referring to the Milankovitch cycles, they have very long periods, 20k years and longer. It doesn't look like they will have an impact, i.e., a return to glacial conditions, in the next few centuries. If he is referring to theories about a general decline in solar output, such as may have contributed to the Little Ice Age, he must consider that the known solar variations are quite small and the cooling of the Little Ice Age was rather local to the area surrounding the North Atlantic. Also, the anti AGW croud likes to forget that there was some rather intense volcanic activity during the Little Ice Age, which produced some dramatic short term cooling in the LIA period. And, it appears that mankind's changes to the atmosphere have increased to the point that they are now larger than the variation in solar output.

Of course, Slicerdicer could be another of those professional "denialist" that have made their living by claiming that there's no AGW. Lately, those guys have had to admit that the Earth is warming, so they are having a hard time presenting a case (even a bad one).

So, Mr. Slicerdicer and Mr. sendoilplease, where's the references?

E. Swanson

From the New York Times, realizing the importance of fertilizer, probably just before it becomes very dear due to Peak Oil:

Ending Famine, Simply by Ignoring the Experts

I've seen several articles like this one over the past few years. The key to ending poverty in Africa: subsidizing fertilizer and giving farmers expensive hybrid seeds.

It works, but in the light of peak oil, you have to wonder if it's wise. Already, some countries are rationing fertilizer, or cutting back on other power use in order to keep the fertilizer plants running.

It isn't sustainable, it is merely the corporate hope that taxpayers can once more be bamboozled into subsidizing their products to the benefit of the corporate administrators and shareholders. "The poor Africans" are just so much cordwood -- they are vector bosons transferring the strong force of money.

Sustainable agriculture uses proven organic techniques -- but that requires labor, not so much money, and is hard to make a profit from.

if you read the article it notes that Africans ended up with an exploding population, and in farming communities one has many children, and gives them a portion of land to grow on (when all land is owned one cannot buy more). These new families subsisting on smaller lands, planted every square meter, every single year.

This depleted the soil (no resting), and reduced yields by some 5-7 fold. The article talks about how some people have 1 acre of land to farm, and that the subsidizing of fertilizer was the #1 method for improving growth, resulting in positive returns to society at large. (basically the function of government is to correct externalities, and here, not enough crops were grown, so fertilizer was implimented)

The result was some 5 fold increase in crop output, and the region exporting crops to other african nations.

Basically sustainable agriculture needs fertilizer, because we try to grow so goddam much food per land unit to feed so many people. The african sustainability was barely clawing along the ground, and i wonder if the african future is everyones.

According to my hometown newspaper, anhydrous ammonia is selling in the range of $600 to $700 per ton, this is the synthetic fertilizer that makes the corn industry tick. Take this option out of the farmers quiver and high yielding, chemicalized corn will be but a memory. When you see a field of corn and see that very dark, almost metallic green, that is anhydrous ammonia at work, Anhydrous burns out soil organic matter so these soils will not quickly recover with organic farming methods. There is no free lunch in agriculture, decades of soil mismanagement will soon be evident.

Actually there are three means to put nitrogen in the field.
Injecting anhydrous is just one. The more common is urea or ammonium nitrate in spreader trucks..The other method is injecting liquid nitrogen(no pressure). Liquid nitrogen is being used more and more around here but last spring there was a sudden lack of it at the suppliers and my farming friends had to scramble.

It was once cheaper to inject anhydrous than any other means but I suppose thats not true anymore. I don't keep up much with the prices since they are so volatile now.

I did work one season for a Af Chem. company driving nurse trucks out to the monster spreaders. At the plant we had 18 wheelers constantly running to refill to the bins. Sometimes they got behind and orders were delayed. It all comes from barges around here. If we have a serious barge problem I think it would be bad for the suppliers. We usually haul our own DAP and MAP and other chemicals since we have the rigs to do so. Sometimes you can get a better price buying it instead of hauling yourself.

I can only assume that 08 will be worse.

Of the three methods anhydrous is the most dangerous. I know of some operators/farmers who got massive burns from a loose fitting or a valve popping somewhere. Very serious burns I might add from the extremely low temperature.

At the chem plant they gave the lackards a job tending the 'anhydrous tree'..meaning refilling the huge cylinders. Last year a rookie driver turned a trailer hauling 4 cylinders over in the ditch. He was a flake when we were in hazmat training and he later proved it.

Hello airdale,

Sounds as if you know firsthand anhydrous is some nasty stuff, hard to believe we put this in dear mother earth. There are a number of ways to increase N levels that are friendly to the soil beyond the synthetics as I'm sure you well know. Animal manure, or better, composted manure and plowdown (green manure) crops being several examples. Organic methods do work and can rival yields from chemical agriculture but it takes time to make the conversion, I estimate about 5 to 10 years to detoxify and build the soil, depending on the level of degradation and percentage of organic matter.

I'm not sure what would work in a different environment but check out my friend's site www.biofuelsnow.com
specifically this link:


Here is an excerpt from the link, Milton Maciel has made a very decent living from recovering degraded soils.

"Restoring degraded land is not difficult nor expensive. This is not theory, nor new technology, I've been making a live doing that for decades. Degraded pasture and degraded horticultural land have been a blessing for me since 1983, when for the first time I purchased a plot of very degraded horticultural land in Ibiuna, some 25 miles from Sao Paulo city. The owner of that farm was forced to sell me a part of it or he would go completely bankrupt. He had been cultivating that area with
potato monoculture for some years, following all the rituals of the horrible poisoning technique for chemical potatoes."

Huh? I hope you didn't mean LN2 when you said "liquid nitrogen," which is a) not bioavailable and b) damn cold!
The toxicity of ammonia is an advantage when you're trying to wipe out nematodes or other pests. It also raises the pH in acidic soils, which nitrates do not.

I'm beginning to suspect the idea of mass die off may come true. If governments keep making decision like these, I may embrace it. How short sightly suicidal.

Considering the history of the Rwandan_Genocide, and what the underlining factors were. This is just insane.

Hello Leanan,

Your Quote: "It works, but in the light of peak oil, you have to wonder if it's wise."

From memory, it brings to mind Garret Hardin's warning that it might be more moral, but immediately heartbreaking; more logical, but ultimately more sustainable to let 4 billion exit now, than waiting for a massive Overshoot of 8 billion much later. Tough, gut-wrenching choice.

Yep, NPK hen and eggs. The places to find and mine cheap, depleting P and K are much more limited than the world's depleting oilfields, and most of the guano was used long ago too. Crop rotation to try and naturally offset drastically more expensive natgas-fueled Haber-Bosch N results in an immediate plummeting of harvest tonnage--not a happy JIT result when global grain reserves are already less than 53 days--less time than a normal seed-to-harvest growing cycle.

Too bad we didn't stockpile a seven-year supply of food and NPK while we had the chance.

Maybe it is already too late for a possible human-directed decline; is Mother Nature now in the batting box? The photo yesterday of the flaming methane burning up through the icehole chopped in the snowy lake was certainly depressing.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

Call on the Liquid Gold bob..

Urine! We need to stop wasting it. Nitrogen is plenty there at least when broken down by bacteria. Fecal Matter can be decomposed and not wasted. But people are so self absorbed they find this to be repulsive. I wont eat something grown from urine! Meh do what you want I guess is what they need to be told.

FWIW: The issue isn't that its repulsive, but can be hazardous because the soil can become containmated with human diseases. These can be transferred to food which than are sold to consumers. Human hormones also end up in the soil, which can effect children.

the Chinese have been doing this for thousands of years. is there any noticeable sign of hormone disorder in their population? of course, eating raw produce without careful washing and cleaning is rarely practiced there.

the people you are talking about arn't exactly being doused with tons of petro chemical derived drugs.


It helps to know what to do with poo, but urine is generally sterile. The how-to part of this e-book is towards the end.


Just because this thread brings out the doomer in me....

Crop rotation to try and naturally offset drastically more expensive natgas-fueled Haber-Bosch N results in an immediate plummeting of harvest tonnage

No it doesn't.

Or not according to the research conducted over the last two decades by Cornell and Rodale, at least. They found that two forms of organic - manure-fertilized and legume-rotated - which received no chemical fertilizers or pesticides produced just as much corn and soy as the conventional approach which used both.

As an organic farmer I know that it takes a while for to establish organic methods and to take effect, as Pimendel also notes:

that although organic corn yields were about one-third lower during the first four years of the study,

So meanwhile the farmer goes broke trying to pay the banker. Moroever, as Pimental also states:

that although cash crops cannot be grown as frequently over time on organic farms because of the dependence on cultural practices to supply nutrients and control pests and because labor costs average about 15 percent higher in organic farming systems, the higher prices that organic foods command in the marketplace still make the net economic return per acre either equal to or higher than that of conventionally produced crops.

Which eliminates the possibility of closely timed crop rotation. In my south central Illinois county the farmers rotate wheat/soybean/corn. They would sure miss the income from that extra winter wheat crop. My other concern is no mention is made whether the methods ar scalable to 1000 acre plus farms. Now maybe a farm bill could be writtten up to help farmers switch over to new methods. It would have to be cheaper in the long run than what the government is shelling out now. I'm sure the fertilizer and seed lobby would back that one. (sarcasm)

I have two of Cornell University's latest greatest grape varieties in my vineyard. They are supposed to let me make high quality wine in colder areas. One of my clients has a small farm down the road from the Rodale test area in Pennsylvania and I have read their books for years. I respect the quality of the work of both.

So meanwhile the farmer goes broke trying to pay the banker.

Which, along with the 15% higher labour costs, is I suspect exactly the reason we see the commercial farming methods that we do. They're not used because they're so much better at producing crops - they're used because they're so much better at producing profits.

Anyway, good to hear an informed opinion on whether I should keep paying attention to Rodale/Cornell. Best of luck on your grapes.

Our modern farming techniques have gravitated to large farms because cheap fossil fuels have made it possible for a farmer to cultivate that large area without the use of other manual labor. As we can expect the relative cost of fossil fuels to rise relative to the cost of manual labor, the economics will change. Some of the other posters here have noted that this is occurring and you make the same point, except that you are looking at the situation using only the dollar as a means of comparison.

The stories posted about fuel and fertilizer shortages mean that there will be many more farmers that won't plant or harvest in future, even if they do already own their land. The transition back to natural (or organic) farming may be the only way for some farmers to stay in production, but getting there won't be easy.

E. Swanson

Hello Pitt the Elder,

Thxs for responding, but I think you are overlooking the interim switching-over period from industrial-ag to organic:

from your link,

"... said Pimentel, who noted that although organic corn yields were about one-third lower during the first four years of the study, over time the organic systems produced higher yields, especially under drought conditions. The reason was that wind and water erosion degraded the soil on the conventional farm while the soil on the organic farms steadily improved in organic matter, moisture, microbial activity and other soil quality indicators."

A lot of people can starve until the organic system ramps up. That is another reason why I have been pushing for relocalized permaculture to help bridge this yield-gap--we need much NPK [chem + organic] to just get basic levels of biovitality going in raw urban and suburban soils.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

I wonder if anyone has come up with an idea what I would call "farm condos". That is a very large farm divided up into smaller plots bound by an agreement to share in the cost of equipment and expenses, and the profits. Eventually each unit could specialize in providing what is need for the whole unit, such as one unit for pasture, another for dairy, another…. Might be a way for large farms to be divided up into smaller organic farms and reduce the risk and cost of each small farm going it alone. Believe me, the cost of starting a small farm is brutal - I've been bleeding red ink for the past year preparing my place.

I think in Israel and Soviet Union they had somewhat similar concepts Kibbutz and collective farms. Obviously you have something different in mind but it might be worth studying how these experiments turned out in communist societies and leswhere to get a feel.

I was going to put in the disclaimer about the Soviet enforced collectivization (I specialized in the Soviet Union as a history major; a good book on collectivization is “Harvest of Sorrow“) but thought better of it thinking that no one would compare a private enterprise of collective ownership with the schemes of communism. And one wonders why we will never have universal health care.

why condo not co-op? call it communitism if one has to distance oneself from communism.

it will be a problem to the industrialized farmers.

in some of the densely populated far east countries, it is a common practice to put fecal (human and animal) along with other organic matters in a covered pool for fermenting, the methane so produced is used as fuel and the fermented matter is used as potent organic fertilizer. the ferment process also helps to eliminate some disease transmitting parasites presented in the fecal matter.

U.S. Credit Crisis Adds to Gloom in Norway

At this time of year, the sun does not rise at all this far north of the Arctic Circle. But Karen Margrethe Kuvaas says she has not been able to sleep well for days.

What is keeping her awake are the far-reaching ripple effects of the troubled housing market in sunny Florida, California and other parts of the United States.

Ms. Kuvaas is the mayor of Narvik, a remote seaport where the season’s perpetual gloom deepened even further in recent days after news that the town — along with three other Norwegian municipalities — had lost about $64 million, and potentially much more, in complex securities investments that went sour.

And here I thought Norway would be floating on cash, what with their oil and all...

My understanding is that the town was strong-armed into making those investments, against their better judgment. Saw something on NRK website about this several days ago --

I think the people selling these financial instruments had an overview of them in Norwegian and the detailed version in English. The trusting/greedy representatives of these towns preferred reading only the Norwegian version.

Personally, I have very little sympathy with them. Like a lot of others, they thought they could increase their returns without inceasing the risks.

Will sue brokerage

Embattled politicians go on the offensive

Terra Securities Bankrupt

I know there is no Norwegian translation of Nassim Taleb's Black Swan but these guys should have known better.

Essentially, these towns make a fortune from hydroelectric projects in the nearby mountains. The guys selling the Citibank crap persuaded them to borrow against these guaranteed future streams of income and to invest the borrowed money in CDO's. How more greedy can you get?

And here I thought Norway would be floating on cash, what with their oil and all...

This illustrates the dilemma of how to store wealth. Sure, they are floating on cash, but to store its value they make investments in the international markets just like other countries. The obvious question becomes, how does one insure that this wealth will at least maintain its present value let alone increase in value, in a world of shrinking resources?

At a Peak Oil debate at Texas A&M University in October, I had two words for the students: Food & Energy.

Westexas, you may have had a third important opinion.

westexas on January 17, 2007 - 12:39pm

I have previously expressed the opinion that if what is going on in the Middle East does not scare the crap out of you, you are not paying close enough attention.

If what Barbara Starr is reporting on CNN is correct on Friday November 30, 2007 - MORE air and ship landing refusals, then

BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): It was supposed to be a Thanksgiving port call in Hong Kong for thousands of sailors in the USS Kitty Hawk battle group. But on Tuesday just hours before docking, China refused to allow the U.S. Navy into Hong Kong, a port it has visited for years. Admiral Timothy Keating, the head of the U.S. Pacific command says he wants an explanation.

VOICE OF ADMIRAL TIMOTHY KEATING, U.S. PACIFIC COMMANDER: China's denial for port access to the USS Kitty Hawk battle group for Thanksgiving is perplexing and concerning to me as a commander of the Pacific command. It is hard to put a positive spin on this for us.

STARR: Hours later, China relented but it was too late. The Kitty Hawk was already on its way back to Japan, hundreds of family members were left waiting in Hong Kong.

should be truly terrifying.


I'm off on Monday to Artesia, NM for several days of essential non-gas-wasting quail hunting.

" China's denial for port access to the USS Kitty Hawk battle group for Thanksgiving is perplexing and concerning to me as a commander of the Pacific command."

should be truly terrifying.


That kind of thing happens sometimes when one country wants to put pressure on another. About ten years ago, a lumber dispute resulted in the ferry between Vancouver and Victoria being denied entry into US waters, which added 25% to the length of the trip until the ban was rescinded a few weeks later. That was unfriendly and obnoxious, but not what I'd call "terrifying".

So how is this bit of political muscle-flexing by China so different? What makes it "terrifying"?

One of the four papers that I get delivered had a follow-on report as to the reason for China refusal to let USN ships make port call. It was tit-for-tat response to W meeting with Dalai Lama. Chinese appear to have irrational attitude toward DL, much as Turks have irrational attitude toward Armenian genocide. Irrational does not mean unexpected, so to me, it is not terrifying or even scary.

We _are_ floating in cash, but more or less all the oil money goes to the big oil fund which now hold ~$370B.

The investments came from relatively wealthy towns, the money coming mostly from hydroelectric power generation. The problem is that they geared up the investments by borrowing against future income from the power generation.

Norway? Does anyone read the Finance Round-Ups anymore?

I do, and they're great. Keep 'em coming.

Venuzuela's situation is confusing. The referendum seems likely to let Chavez model his country after Castro's Cuba. But it is his threat to cut off oil to the US if we interfere with their politics that is curious. I know that China is building super tankers for oil. Is it possible that oil that was earmarked for the US could be sold to China instead? How would it get there?

Speaking of Cuba, what of their oil discovery? It seemed to be as "good" as the Brazilian find. Have they found someone trustworthy to pump their oil?

Not sure why you think the referendum would model Venezuela after Castro's Cuba. The referendum, as I read it, essentially does away with term limits for Presidents. If Chavez keeps winning elections, he stays in power much like FDR. Castro, on the otherhand was never elected by popular vote, or at least with an opponent on the ballot.

The term limit change is only one of many changes in the referendum, most of them social in nature.

The following link is to a pro-Chavez site, and talks about the referendum:

Mostly I am interested in whether there are teeth in Chavez's threat and whether his fears are grounded.

Chavez loses referendum

CARACAS, Venezuela, Monday, Dec. 3 — Voters in this country narrowly defeated a proposed overhaul to the constitution in a contentious referendum over granting President Hugo Chávez sweeping new powers, the Election Commission announced early Monday.

There is also this from AP :


It was interesting to see that the defense minister that helped turn around the 2002 coup was against Chavez on the referendum vote.

It was a close vote according to the AP article and Chavez has been gracious sounding so far, but his defense minister claims that this vote is kind of meaningless, because of the powers that have been granted him so far.

I think there will be a fall out from this, but I don't know what it will be. The elections were unmonitored. Will there be claims of fraud? Is this the beginning of the end for Chavez? What will he do to regain the popular vote? Who will he blame for the loss of the referendum?

Finally we are starting to move in the right direction:

How Africa's desert sun can bring Europe power

Europe is considering plans to spend more than £5bn on a string of giant solar power stations along the Mediterranean desert shores of northern Africa and the Middle East.

There is a lot more background material here

RE: Limited Bio-fuel Feedstock Supply

This is the crux of the cellulosic ethanol silliness. Even if a commercial process is developed, the feedstock has to be grown on land currently used for something else thereby reducing whatever is produced now. The idea that there are large tracks of land rich enough to supply the huge volumes that would be required and that now are not in production is fantasy. Only poorer land is available and that means the cost of gathering and transporting large volumes would likely be prohibitive. Harvesting for cellulosic ethanol would deplete soil fertility just like corn if it is not replaced using fertilizer.

Using corn stover is equally ridiculous. Poet Ethanol which has a plant about 14 miles from my place is experimenting with corn cobs at another plant. John Deere is developing equipment to harvest them when the corn is combined. Farmers have a nip and tuck time getting the field work done in the fall as it is without fussing with corn cobs. If the price of corn stays relatively high, there is less incentive also. But the big problem is the sheer bulk which implies high labor and transportation costs. Few appreciate the concentration of energy and the ease of harvest that there is with corn. The infrastructure is in place which is no small thing. The problem is that corn is inappropriately priced by the market compared to oil. That is why ethanol has expanded as farmers desperate to make a profit sought out alternative markets for their corn.

But of course, the real agenda is taxpayer subsidies for John Deere, ConAgra, ADM, etc. The first on board the Ponzi bus will strike it rich (in dollars, at least -- which may turn out to not be worth so much) and the taxpayers will be taken to the cleaners.

Economist Cover

Time to buy the dollar?

re: Surfing the Ultimate Peak

Thanks for thinking of me Leanan. It's a decent article, from a surf mag. Surfing is an especially vulnerable sport, not so much the equipment but the travel required. But really, what (sport) isn't threatened??

The snow didn't stick here in Portland, Oregon, and now it's just endless rain. I enjoyed the weather talk yesterday. My wife is writing a paper so I had (have) no computer access all day.

Nelsone - I may be moving back to your neck of the (no longer) woods. Over the hill in Monterey though. Want to buy a nice little house in SE Portland?? Portland is nice but I'm just not a city person.

Find a good spot and settle down - that's one peak oil plan. I did like the migration idea though. Those living on boats know, and do, the drill.

I have followed Winter around when possible, for that is when the waves are best. It's good to stay in the tropics or close by though, surfing is one thing that you really can't do much when it's truly freezing.

Also my wife bought a new car - a Mini Cooper - so I'm going to part with my well-liked Toyota pick-up and buy her Honda Civic - ELP!

I just started 'Revenge of Gaia' by James Lovelock. I've been meaning to post a few book reviews. He is a hard-core fast-crash doomer these days.

He says it's too late. Civilization is done for.

Not to end on a down note though. Individuals can survive, even thrive, just collectively, we're yeast.

Conference on China’s Exchange Rate Policy

Interesting set of graphs.

Richard Wakefield

I couldn't get your link to work. Perhaps this is the link.

This is one of the graphs of the paper. There must be a high inflation rate, and a low interest rate paid on savings - an unsustainable situation.

Click for larger image.

I am trying to figure out why that is unustainable. There are many places in the world that pay lower than inflation rates on savings deposits (especially if you are paying tax on the interest).

No doubt it sucks for the savers, and that is why we have consumers here in America. Maybe the Chinese will pick up this trait.

Ummm... I think you answered your own question.

Baby Boomers learned not to save in the 1970s, when Regulation Q limited passbooks to 3.25% and inflation ranged up to 15%. So the US of A is in hock way over its eyeballs. Folks in China and elsewhere will learn too. Cultural factors may slow the learning process down, but people do learn. Even when they don't learn, the generations still change over.

Now, if the fact that we have little but debts makes it tough to build all the hugely capital-intensive wind and solar farms, nuclear plants, electric rail lines, and so on that have been proposed, then, oh, well, we'll just burn lots more coal for a while, and argue loudly about it the whole time.

But look on the bright side. In developed Western countries, the policy of attaining prosperity by borrowing and repudiating our debts via inflation has been working like a charm for longer than most folks have been alive. So by induction, we must conclude that a thing like that could never burn itself out and come to an end. Could it?

I think that we can still attract capital if there is reasonable ROIC (Return on Invested Capital) in the project. Strong property rights make capital attraction easy. It just may be, that without indirect costs factored in, coal is cheaper to burn. The amount of capital that is available to build mall after mall and to open new and remodeled department stores shows that capital is not the issue for Wind Farms etc.

Inflation to pay of debt: If debt is domestically held then there is a mechanism already in place: Pay a nominal rate over inflation and tax the gain without adjusting for inflation
(e.g. inflation = 3%, pay 4%, but after 35% tax it is only 2.6%, so in effect inflation will take care of debt over time).

However, the US treasury currently gives tax free interest to Foreign holders of treasuries. Therefore they get to keep the full 4% and it becomes difficult to inflate away the debt.

Here is the naughty part: Congress can by an Act require that foreigners too be taxed on Treasury interest, with the tax due to be deducted before paying interest. Voila - debt will be inflated. And if the foreigners still want to manage their particular currency/dollar ratio, they will just have to earn a little less risk free money doing so.

Gail any thoughts on the TED spread now?


TED spread Treasury-EuroDollar spread

I dont get it. The link points to a graph of the ratio between bank loans to deposits.

The TED spread is calculated as the difference between the T-bill interest rate and LIBOR.

How are these related?


The U.S. Bureau of Land Management, which controls immense swaths of the desert, has received land-use requests for 34 solar plants, each of them capable of generating as much electricity as a traditional power plant burning natural gas. It's unlikely that all will get built, but if they were, they would generate enough power to light 18 million homes...

So it seems like it won't be a big problem for California to build enough solar plants to meet most of our electricity needs...

I live in Southern California and sometimes feel like we get a bad rap on this board, in fact I think we have a lot of potential advantages for the post-peak environment.

While it is true that many of the region's far-flung automobile suburbs will become unsustainable as fuel prices increase, yet the tendency towards RE-centralization and urbanization here in LA is already well-established and I expect this trend to accelerate in future, driven by rising oil prices.

The downtown urban core is filled with loft projects served by the Red Line subway, and other areas connected to our fledgling light-rail system are booming as well. Although progess on the train system has been painfully slow, the Orange Line limited-access busway is a nice compromise and quite pleasant to ride. I can see this kind of solution being implemented very rapidly if necessary.

I live in the middle of urban Hollywood with my girlfriend, and we have arranged our lives so that our energy needs are extremely low. There are two different subway stations within 10' walk of my house and I ride my bike or take the bus/train virtually everywhere I go. Although our public transit system here leaves much to be desired, still it is possible to get to quite a lot of places around the city and I expect the system to improve significantly in the coming years as urban priorities are readjusted.

I bike to work and my girlfriend works at home. I only drive a few times a month, and we walk to the Hollywood Farmer's Market on Sunday morning to buy our produce from local farms (mostly in SoCal).

Further, the famous SoCal climate means that we hardly need to use any energy for heating/cooling either. We could easily get by with no AC or central heat if necessary, an oil-filled space heater to keep my feet warm is all I really need to keep comfortable.

All this added together means that our direct expenditures on fossil fuel energy are vanishingly small.

Water is definitely a worry in the future, but Californians waste water so extravagantly at present that it doesn't seem like a very pressing concern. We could certainly save a large part of the water we currently use with simple conservation measures, without much serious impact on lifestyles...grassy yards and swimming pools might be a problem though.

No doubt there will be wrenching urban transformations in store for us here in future, as there will be in most US cities, but just wanted to point out that life without gas/oil here in SoCal might not be as bad as a lot of places...

We get a lot of bad rap in Southern California.

But we also have a lot of good stuff going for us too.

We rarely absolutely NEED either heat or cooling.

We have decent aquifiers, which are handy for water storage or heatsinks.

We have adjacency to the ocean, which is handy for ports.

We have lots of ag land.

We have lots of people ( yes, Mexican immigrants ) with PRACTICAL skills. Gardening. Masonry. The kind of things one knows when one grows up without the silver spoon already in mouth.

I get the idea this place won't be any worse than any other if we are forced to make it on our own as a community.


The TH!NK electric city car begins production:

180 km (110 mile) range using Zebra (NaAlCl4) batteries, 100 km/h (60 mph) top speed. They plan on producing 3,500 cars per shift in 2008! This seems like more significant real world progress than the Tesla Roadster.


They also have an agreement with EnerDel for lithium-ion batteries which would be lighter and have more power and energy. As intended it could be a great city car but also make an efficient commuter, or be a secondary car for a family.

I would love to have a "Think" to get around but the thought of being in this little car surrounded by high balling tractor trailers and Suv's scares me. We will have to dedicate lanes for these electric auto's before I would consider the purchase of one.

You will die one day - why not die in a way that your estate might have a chance to collect a big payout?

I would love to have a "Think" to get around but the thought of being in this little car surrounded by high balling tractor trailers and Suv's scares me. We will have to dedicate lanes for these electric auto's before I would consider the purchase of one.

Or really high gas prices. I bet that'd do it, too.

(As someone who's made hundreds of trips in an old Austin Mini - a car whose passengers could and sometimes did pick up and put on the sidewalk to mess with the driver - I have no sympathy for your irrational fears.)

I enjoy reading articles by Bednarz as they help to increase awareness as to how healthcare will change in the US. The current standard of care requiring us to keep essentially brain dead illegal aliens on ventilators in our intensive care units for prolonged periods will need to be dealt with (personal experience in the month of November). I do not know of a single hospital administrator who is familiar with peak oil. Anytime I try to mention it to other colleagues, I am quickly dismissed.

I certainly would not count on the current level of medical care within 5 years. When physicians are no longer paid to go to the emergency room at night and it becomes dangerous to do so, they will stop.

Healthcare is one of those areas where "the market" clearly fails.

How do you "negotiate" with arm's length objectivity over the "value" (price) of a loved one's life or pain?

The answer is you don't and you can't.

Sure it's easy to talk about pulling the plug on some outlaw extraterrestrial who fails to demonstrate possession of an English speaking brain, but will you glibly do the same for your own grandparent? (Shut off the power to their ventilator?) What if the doctor made you do it (hit the kill switch on the machine)? Talk is easy when it's the other guy's ass on the line.

Yes I agree that health business administrators have a faith based belief they are immune to fringe concerns like Peak Oil. The Market has always provided for them and always will (or so they believe).

Everyone in my family has a legally binding DNR.

Don't be so quick.

Doctors are human.

Humans are fallible.

(DNR = do not resuscitate =license to kill)

In case this hasn't been posted yet, there was a great editorial today in the Houston Chronicle about creating high speed rail in Texas.

Hello TODers,

Another reason why the droughts may continue to get worse in the US and elsewhere:

Earth's tropics belt expands

WASHINGTON - Earth's tropical belt seems to have expanded a couple hundred miles over the past quarter century, which could mean more arid weather for some already dry subtropical regions, new climate research shows.

Every time you look at what the world is doing it's always far more dramatic than what climate models predict," Weaver said.

Both Weaver and Seidel said the big concern is that dry areas on the edge of the tropics — such as the U.S. Southwest, parts of the Mediterranean and southern Australia — could get drier because of this.

"You're not expanding the tropical jungles, what you're expanding is the area of desertification," Weaver said.
Meanwhile, our winter lawn golf courses and car-washes are just packed today in my Asphalt Wonderland.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

Here's a different point of view about near term oil price in a Froma Harrop editorial today.

She discusses predictions made by Henry Groppe:

'In 1980, when the Iranian revolution sent oil prices soaring, everyone else — Exxon, Shell, the U.S. Department of Energy — predicted that a barrel of oil would soon cost $80, $85, $100 a barrel. In a contrarian forecast, now legend, Groppe said that oil would fall below $15 a barrel. And that's what happened.'

'Why did his firm, Groppe, Long & Littell, expect the price collapse? "We thought there would be a significant drop in consumption," he said."'

'Groppe sees consumption dropping now. "Everybody is still in denial about the magnitude of the changes." He predicts the annual average price of oil will fall back to $60 to $80 a barrel in the next several years."'

Mr. Groppe's record of contrarian and accurate forecasts makes this something to take seriously. Interestingly the forecast he made at ASPO in Houston showed world oil production declining starting in about 2012 (which is yet another independent and influential vote for declining oil production in the next five years). It's not clear if he expects price to be flat after 2012.

See my post yesterday near the end of page 2 "NEWS FROM THE CONFLUENCE OR WHY AMERICA IS THE PLACE TO BE"


Or my post on The Oil Drum which I was so graciously allowed to do:

My concern is this: Based on the premise, which is being more and more widely accepted in the financial community, that oil is only going to be higher and higher in price, we are seeing millions of investors herded into oil, gas and commodities investments that can only achieve returns if the price of oil continues to rise.

But what if it doesn't? This is becoming a classic bubble. I know people who have never invested in commodities or oil/gas futures who are saying "I called my broker and said "get me in oil". The internet hawkers are using the fear of peak to herd millions into the game, hedge funds are buying huge contracts and stakes in the energy and commodiies markets, pension fund money, municipal pensions, university endowments, corporate funds are being hurled in, all based on one premise: THE PRICE OF OIL CANNOT GO DOWN.

This is big. We really don't know how big, because so many of the hedge funds and international funds are off the radar, under no oversight by anyone.

If oil does begin to drop in price by a large amount it could make the "mortgage collapse" look like small beans in comparison. And if it dropped fast, most folks do not have either the ability or the knowledge to know how to get out fast.

In past years, we had an investment environment based on the premise of "cheap oil forever". That was unrealistic. Now, we are building an investment environment based on "rising oil prices forever". That is equally unrealistic.

And if other commodities, such as gold, silver, copper, nickel, molybedium, platinum, etc, began to decline at the same time, we could see people and funds get wiped out fast. It has happened before.

Please, be careful.


groppe does have a good track record, but its not getting better. Earlier this year he said (and I quoted him in an energy letter I occasionally write) there is plenty of world wide demand destruction at 60/b to prevent price from going higher, but somehow we got quite close to 100 before backing off. Now he says 60-80 is about right... IMO what is happening is that china/exporters soak up everything that slow growth regions walk away from, pretty much ignoring price. Much is said of flat US demand, but this is not today's story...

Current back off from 100 seems on account of hopes for more production from opec, particularly considering typical 4q&1q high demand. Latest comments, tho critically not from sa, is that current declining price is plenty of proof markets remain well supplied, pretty circuitous. I make no prediction of price, dd is clearly ongoing at 90 world wide but meanwhile chinese consumers, more so exporter consumers, are protected from high prices so naturally are in no mood to consider prius options. Besides, sa and some other gulf women have an average of six kids, how to squeeze in a prius? Only largest hummers are worth considering.

Groppe may or may not be calling 08 prices correctly, he missed (by over 50%!) in 07.

Regarding the post on WW1, bieng British and a student of military history I can say he was wrong and does a great diservice to the British nation and armed forces in thinking that Germany would have won the war without American Intervention.
Even without the Americans the balance of forces was pretty even. The great tradgedy of American intervention is that without it the war would have ended in a stalemate and the allies would have been forced to negotiate a peace. The total victory Wilson gave the allies paved the way for WW2.

Germany did not pay reparations in WWI. They got more money from the Americans after the war than they paid to the French and British and Belgians. They didn't pay any reparations to the Russians, either.
We were afraid that if we insisted on reparations the Germans would just sign an alliance with the Russian communists instead, and they would have.

Hello Weatherman,

I am not a historian, but I posted before on how the US might have decided to purposely enter the war when Germany cutoff our cheapest, and only import source of potash in 1914. I have no idea if that cutoff would have eventually led to the internal collapse of our civilization, but I bet it occurred to some leaders as they helplessly watched prices skyrocket from $35 to $500/ton [approx. $10,500/ton in 2007 inflation adjusted dollars--much more costly than the current going rate for potash].

The German potash industry was the sole source of potash for American agriculture and industry up to the outbreak of World War I....the wartime potash shortage had been a near tragedy; fortunately, a few folks refused to forget that lesson, insisting that security for America could lie only in discovering low-cost American supplies.

When the first OPEC energy shock hit, Pres. Carter, by being both a peanut-farmer and an nuclear engineer trained by Admiral Rickover: I think he easily understood the possible ramifications if his advisors informed him of this bit of potassium history, then compared it to FF-energy.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?


The US has been blamed for everything I could imagine on this site. But the Second World War? The Oil Drum has good technical discussions, but the incessant US bashing is distracting to people like me, and it drives us away.


I am truly sorry if I may have contributed to distraction from technical topics by my polemics and diatribes against USA and "the system"in perhaps unconventional manner which may bring my patriotism into question(no sarcanol here). I trust that this particular upswelling of rage against the machine will be followed closely by political change as happened in Australia and that such discontent is just a sign of pending change. If Gore had won the election twice perhaps certtain old lingering anti-american resentments would never have surfaced but slumbered underneath the surface as many Green policies would have been adopted and Iraq would never have been invaded and an upsurge in a cold war with Russia would have been avoided for example. I blame Bush then for the icy attitude to America. I hope things change when he is gone and that the PO bandwagon gets moving in a positive direction for all of us.

I thought Krugman's column was pretty powerful - and very worrying: http://www.nytimes.com/2007/12/03/opinion/03krugman.html

Paul is on the left side of the debate of markets vs. regulation, and he clearly thinks the latest proposals for modest relief to a small number of borrowers is worthwhile. But, even as a proponent, he points out that it is only a small dent into the problem, while the market, giddily bidding up the financials thur/fri, is hopeful that mission is accomplished.

In january bank auditors, no longer provided with insurance against liability by their clients, will presumably tell the truth regarding present value of investment banks' level three securities... but, if so, the banks will be pronounced insolvent. The alternative is to refuse to do the audit, likely resulting in a similar response by the markets.

In the 80's the japanese, loaded with excess dollars, made investments in us real estate and firms that later proved unwise. These days the oil exporters, similarly burdened with dollars, are making investments that, imo, will turn out to be unwise, not least dubai 7.5 billion in citibank (this money bought 100M barrels; pretty good deal, overall, satisfying our import demand for a whole week. Wonder how many times we can repeat.)

Why was this allowed to happen? At a deep level, I believe that the problem was ideological: policy makers, committed to the view that the market is always right, simply ignored the warning signs.

Call Paul (quoted above) what you wish, he's still "right".

Ours is a faith-based economic system.

The problem is that greed corrupts and absolute corporate greed absolutely corrupts the whole of our corporal essence.

The market that "is always right" got us into the Peak Oil/AGW mess in the first place.

It's going to keep on keeping on in heading us "right" towards the precipice's edge and beyond unless we step back and rethink the way we organize civilization.

I'm not saying we go commie. That didn't work either. But corporate ethos is just as internally corrupt as is a party based autocracy. The markets aren't always right because the markets are steered by the same irrational and greed infested brains of the monkeys who created markets in their own image in the first place.

We're not what we think we are.

Peak Spam? Now there's one peak I hope is true and very close, if not in the past:



We told Hugo to buy those Dibold machines, but would he listen....nooooo:-)