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DrumBeat: June 29, 2008
Posted by Leanan on June 29, 2008 - 9:09am
Energy crisis casts dark cloud over Massachusetts
Bay State electric and natural gas shut-offs are predicted to increase by at least 20 percent this summer as a staggering 125,000 low-income households face energy bill debts totaling about $100 million, the Herald has learned.The Boston-based National Consumer Law Center, which is predicting the exploding shut-off rate, said a grim economic climate is behind the utility crunch.
Birthrates across the Continent are falling at drastic and, to many, alarming rates. Why are Europeans so hesitant to have children, and what does it mean for their future and for ours?
Australia: The energy crisis needs a clear head and nerves of steel
It sounds like a horror story. It isn't. In fact it is quite the opposite. What the study showed was that in most cases increases in wages and and incomes would offset the higher energy prices.
In a Season of Discontent, Many Protests Sweep India
NEW DELHI — Discontent is sweeping through India in the form of widespread protests over land use, food, fuel and jobs.
Report blows hole in wind power plan
Wind power would be too unreliable to meet Britain's electricity needs, according to a new report.It says wind patterns around the country mean turbines will fail to produce enough power at times of high demand.
Written by an independent consultancy and funded by the Renewable Energy Foundation, the report says backup electricity plants will be needed to meet demand during calm conditions.
Can Weeds Help Solve the Climate Crisis?
Weedy ancestors of our food crops, some scientists predict, will cope far better with coming climatic changes than their domesticated descendants.
So why do stories about an geographically special, but climatically unimportant, single point traditionally associated with a christianized pagan gift-giving festival garner more attention than long term statistics concerning ill-defined regions of the planet where very few people live?
Nigerian conflicts tighten oil bottleneck
WASHINGTON -- Amid surging demand for oil, a severe bottleneck has developed in production of high-quality West African crude, alarming world leaders and demonstrating a new vulnerability in fragile oil markets.With production declining elsewhere, consumer nations had been looking hopefully toward Nigeria. But rebels who have waged an increasingly bold campaign in the oil-rich Niger Delta have slashed the country's output in their most recent attacks.
One Reason Gas Is Emptying Your Wallet: Nigeria
When armed rebels from the Movement for the Emancipation of the Niger Delta attacked an enormous oil facility 75 miles off the swampy West African coast on June 19, traveling hours by speedboat under cover of darkness and kidnapping an oil worker, their brazen assault underlined the perhaps underappreciated dependence of the United States — and the world — on oil from Nigeria.
Global oil price: A crisis waiting to become a disaster
ACROSS the world, protests and demonstrations have erupted against governments for the surge in fuel pump prices, which is also sparking general inflation in the price of food and other commodities. Protests and demonstrations have taken place in countries as diverse as the United Kingdom, France, Spain, Portugal, Egypt, India, South Korea, Hong Kong, Thailand, Indonesia and the Philippines.
Miller's tale brings home burden of high fuel prices
It is Wednesday afternoon and there is only one customer at Robert Elunyu's mill in Katine: a young man who has brought a basinful of dried cassava tubers for grinding. Elunyu is grinding the tubers as quickly as he can because the mill is powered by a generator and the longer it runs, the more diesel it uses. Across Africa, fuel is becoming prohibitively expensive.Remarking on the lack of customers, Elunyu says it was markedly different 10 years ago when he first ventured into milling. Demand has plummeted because he is forced to pass on the rise in fuel prices to his customers, who can no longer afford to use the mill.
The Philippines: More oil price hikes in next 4 weeks
Petroleum players may likely increase their pump prices in the next four weeks, hoping to recover what they say is an under-recovery of P6 per liter incurred as global oil prices continue to soar.
Opec portrayed again as the whipping boy
Opec is dominating the news again. On the one hand, Opec – specifically Saudi Arabia – is doing its best to pump more oil and ease high prices, despite indications that demand is slowing and there is a lack of spare capacity in most member countries. Saudi Arabia is one of the few with the ability to pump more oil, and has committed itself to producing an extra 500,000 barrels per day.On the other hand, there are loud voices being heard that want to take legal action against Opec, tax its windfall “profits”, and even seize Opec assets if it does not pump more oil or bring down prices, as if by waving a magic wand.
This is dangerous talk that will only make those Opec members who are trying to ease oil prices more resentful, and lead them to examine ways of shifting sales to Asian markets.
Saudis say output hike is commercial
Saudi Arabia has said its agreement to boost oil production to nearly 9.7 million barrels per day is commercial not a political decision and hinted the increase would depend on demand, a Saudi newspaper reported.
Dale Allen Pfeiffer: Smell the roses - suicidal tendencies
Now, as oil prices aim for the stratosphere, there is no talk of rationing, or even slowing down. But wait, someone is trying to start a grassroots movement to spur motorists to drive more sensibly and save. And the person who is spearheading this effort is none other than Jay Hanson, the man who established the dieoff.com website that first woke up most people to the idea of peak oil in the late 1990s and shortly after the turn of the century.
Being poor in oil and coal might once have been considered a disadvantage, but not for France. Forty years ago necessity led Charles de Gaulle to pursue nuclear power aggressively as a chief source of electricity. For years this strategy put France at odds with environmentalists, but climate change and soaring demand for energy have changed all that. Because of its 59 nuclear reactors, which provide fourth fifths of the country's electricity, France now emits only about half the greenhouse gas per unit of GDP of the United States (about the world average), which propels France to near the top of Yale's and Columbia's Environmental Performance Index (EPI). Nuclear power not only helps insulate France from wild fluctuations in energy prices, but it also suggests a way to reduce its dependence on oil for cars, trucks and buses: if and when plug-in hybrid vehicles and hydrogen fuel-cell vehicles are ready to replace today's cars, French drivers will be able to tap clean energy from their electrical grid.
If you were trying to develop a less effective means of kicking the gasoline habit and coping with climate change you'd be challenged to improve on North America's misguided biofuels policy, which is centred on corn-based ethanol and is contributing to the global food crisis.(Part of series on the global food crisis)
Vacation home investors struggling to find renters
WASHINGTON -- The pool, hot tub and ocean view are the same this summer at Bandit's Lair, but the seven-bedroom luxury home on North Carolina's Outer Banks is missing something critical: enough renters to keep it fully booked, even at a 10 percent discount.Owner Pat Sepanak said she may leave the house in Corolla empty for part of the summer. The usual herd of vacation renters has been thinned by economic fears and high fuel prices, she said.
India: Neighbours' grid greed sparks cuts
Till neighbouring states like Punjab and Rajasthan do not curtail their overdrawing, the erratic power situation will continue, said sources. Sources in Delhi government said that there were four reported under-frequency relays in the city resulting in frequent disruptions in power supply.
For Iraq’s Oil Contracts, a Question of Motive
Today, the question hanging over Iraq is whether its natural endowment will be used to help create a sustainable new state, or will instead be managed in ways that reward the cronies and allies of the country whose army toppled Mr. Hussein. Or perhaps both at the same time.That basic question was yanked back to the fore recently when word emerged from Baghdad, in a report in The New York Times, that the Iraqi oil ministry was close to awarding contracts to service its oil fields to some of the largest Western oil companies. While relatively small, these contracts could serve as a foot in the door for much more lucrative licenses to explore widely for Iraqi oil.
'The Archers' brings the idea of a self-sufficient community to the fore
The petrol pumps are dry, the supermarket shelves are bare and family cars sit uselessly in driveways. Faced with a national shortage of oil, the comfortable lifestyles of middle-class people are threatened by an austerity not seen since the post-war rationing of the early 1950s.This is Britain in 2012, according to 54?year-old Richard Hathway and his wife Karen, who live in a family home in a sleepy Worcestershire village. They are convinced the country is heading for the worst oil crisis it has ever known, so this year they have decided to change their lifestyle for good.
Few would deny that Alberta's heavy-oil producers have to literally clean up their act. But when Barack Obama threatens to break America's addiction to “dirty, dwindling and expensive oil” and endorses a proposed “low-carbon fuel standard,” he is harming America's own national interests. Canada is the largest exporter of crude oil to the United States, surpassing Mexico and Saudi Arabia, and supplying almost 19 per cent of U.S. demand. If the U.S. eliminates its Canadian heavy-oil imports, which are now growing significantly, Canada will soon find other eager customers such as China, and will simply expand its pipeline system to supply them. The Americans would be hard-pressed to find as reliable or as conscientious a supplier.
Economist: Wages won't keep pace with energy boom
CHEYENNE - A senior economist for one of the world's largest energy companies says rising costs will mean continued growth in the production of coal, oil, natural gas and other forms of energy in Wyoming. But he says average personal income in the state won't keep up with the rising cost of energy in the future.Mark Finley, senior U.S. economist for British Petroleum, said Friday in a speech to business leaders in Casper that his company believes there are abundant oil reserves around the world. However, he said industry is hard-pressed to develop them fast enough to meet demand.
Alaska: Competition may spur in-state gas line
The two projects hope to solve the same problem: Declining production in Cook Inlet threatens to cause a shortage of natural gas supplies in Southcentral Alaska. According to one forecast, that shortage could start to be felt as soon as 2014.
"Alarming" consumer splurge threatens UAE economy
DUBAI (Reuters) - Rampant consumerism in the United Arab Emirates -- home to Dubai, the self-styled capital of conspicuous consumption -- could damage the economy and hinder the Gulf oil producer's efforts to become self-reliant, a government report said.
As airfares skyrocket, wallet-friendly options will keep you grounded
This month has been one of the gloomiest in U.S. travel history. Everything has gone wrong. The dollar has plummeted in value, the cost of oil skyrocketed, and three major airlines - American, United and Continental - have all said they will be reducing flights by 10 to 15 percent, causing airfares to climb by amounts that I predict will be shocking.So what will you do about it? Seven solutions come to mind...
We may not be doomed, but we also may not be ready for all of its effectsAmericans are feeling serious pain at the gasoline pump, and scratching their heads as to why. Part of the answer may be that we are approaching peak oil sooner than many people would have guessed.
Peak oil refers to a key turning point when global oil production peaks, signaling a future of slowly decreasing world oil production. No one can say when peak oil will arrive, but one fact at least suggests that it may come sooner rather than later: Until recently, the Organization for Petroleum Exporting Countries barely tried to stem the rise of oil prices from $50 dollars per barrel in February 2007 to more than $130 per barrel today.
The geopolitical implications of this gathering crisis for world oil supply 2010-15 are immense. The risk of further military interventions and conflicts in the Middle East is clearly high. Total world oil reserves are estimated at 2.5-2.9 trillion barrels, of which half has now been already consumed, while half of the 51 oil-producing countries reported output declines in 2006. Non-Opec production is expected to peak and decline within the next five years, driven mainly by burgeoning demand from China and the US, together with restricted output from Iraq. Then in the following five years Opec's diminishing spare capacity will probably become increasingly unable to accommodate short-term fluctuations, depending on how fast world demand grows and how extensively Opec invests in new capacity. The latter may well not raise production capacity high enough or quickly enough, whether for political reasons or because internal decision-making is too slow or the security environment too hostile.
Experts warn of 'no-holds-barred' Arctic fight
A high-powered group of international experts are warning a "no-holds-barred" race for Arctic resources could shape up unless countries around the world move faster to reach agreements on development, safety and environmental standards.A new report by 40 experts from six different countries spells out four scenarios for the future of the top of the world -- including one in which the Arctic becomes increasingly militarized as demand for energy, minerals and even fresh water outpaces and overwhelms diplomacy.
Oil market oversupplied but not wise to cut: Qatar
"It is not wise today to cut supplies even though there is a surplus because we do not want to create a psychological problem," Attiyah told Reuters. "I'm not in favour of it at all. We want to try to help to ease the psychological heat."But the Qatari minister criticised a move by U.S. politicians to sue the Organization of the Oil Exporting Countries if the oil club did not pump an amount of oil that Washington sees sufficient.
"The Congress should look to increase exploration inside the United States," Attiyah said. "It is strange to ask what I should produce. It's an issue of sovereignty."
Oil leaders meet again after Jeddah failure
MADRID (AFP) - A week after failing to deflate record oil prices at a summit in Saudi Arabia, the world's biggest crude producers and consumers will get another chance to tackle the problem at a meeting this week.More than 3,000 delegates, including leading corporate and political figures, are to meet at the 19th World Petroleum Congress (WPC) in Madrid, which runs from Monday to Thursday after an official opening reception on Sunday.
Brazil expects OPEC invite, sees moderating role
RIO DE JANEIRO (Reuters) - Brazil, which has found big offshore oil reserves in the subsalt cluster, expects an invitation by OPEC to join the exporter countries' cartel, Energy Minister Edison Lobao was quoted as saying on Friday.Lobao said in an interview with Valor Economico business newspaper that his estimates were based on the fact that Brazil had been called up for a meeting of oil producer and consumer nations in Jeddah last weekend.
With the price of oil hitting a record high of $142 a barrel yesterday, Scotland's fishermen find themselves plunged into an even deeper crisis.About a fifth of Peterhead's fleet remains tied up in the harbour due to the prohibitive costs. Crews are looking further afield for work, with skippers finding themselves left with no option but to pare back wages in order to make some semblance of profit.
Fuel hike makes Britons street-smart
The rise in cost of oil, credit crunch and general economic downturn has meant that households are being forced to fundamentally change their lifestyle. Cash strapped families are juggling higher energy bills, mortgage payments and the rising cost of food.The spiralling cost of petrol has meant that more than two thirds of Britain's motorists have cut the number of journeys they make by car—walking, cycling or using buses and trains as alternative modes of transport. "People are clearly feeling the pinch. Families are cutting back in other areas, but we are now getting to the stage where the only option they have is to reduce their car use," said Luke Bosdet, spokesman, Automobiles Association.
Will the Last Superpower Recognize In Time What We Must Do to Save the Planet?
Cheap oil provided an energy subsidy that defined the wars, economies, settlements, values, and lifestyles of the 20th century. The result was a century of wasteful extravagance and inefficiency that encouraged us to squander virtually all Earth's resources -- including water, land, forests, fisheries, soils, minerals, and natural waste recycling capacity. We are now waking up to the morning-after consequences of a brief but raucous party. These include depleted natural systems, unsustainable economies, an obsolete physical infrastructure, and a six-fold increase in the human population dependent on the diminished resources of a finite planet.
Saying 'so long' to the petroleum age?
"If we wait until after the peak," he says, "then energy gets squeezed, and it will be incredibly destructive" because we'll need energy to develop new sources at a time when energy's already stressed."We have to plan for what's coming next, invest long before or we're in for a tough transition."
Beijing faces turmoil due to water crisis: Probe International
BEIJING (AFP) - Beijing's water crisis is so critical that the city is facing economic collapse and the need to resettle part of its population in coming decades, a leading development policy group said Friday.Experts predict the Chinese capital could run out of water in five to 10 years, according to Grainne Ryder, policy director at Canada-based Probe International.
'Peak oil' theory gains local converts
Eric Saigeon typed "peak oil" into a Google search this spring, and his life may never be the same.
Eric Saigeon typed "peak oil" into a Google search this spring, and his life may never be the same.
High fuel costs in the Triad caused a discount airline to fail, school buses to drain county coffers and companies to switch to four-day work weeks.All this before the average price of unleaded gasoline hit $4 a gallon.
So what would Guilford County residents experience if fuel hit $8 a gallon? Or $10?
The towns taking control of their future
(CNN) -- "Within the oil crisis and climate change there is the opportunity for an economic, social and cultural renaissance the likes of which we have never seen before," says environmentalist and perma-culture designer Rob Hopkins.
This oil thing sure has legs. Even if we aren't in a "peak oil" situation (and even the Saudis can't agree about that), we've gotten to a price point where consumer behavior is going to change significantly over the next few years. Over the long term, that's a good thing. The world economy is addicted to oil, largely because it's been so cheap for so long. But it's not cheap anymore and given the pace at which the rest of the world is developing these days, it's not going to be cheap ever again. Unless we find another source of energy that is a lot cheaper than oil and I am not aware of any developments that will get us there soon.This has bigtime ramifications for slowing growth and rising prices (inflation). And these impacts will not be limited to the US economy. They will be felt worldwide. The hypergrowth economies of China, India, Brazil, Russia, and other developing economies may not be impacted as much as the more mature economies like Japan, Europe, and most of all the US. Russia, in particular, stands to benefit greatly from the spike in oil prices.
Home heating oil customers in limbo
Wildly fluctuating prices have caused some local home heating oil companies to put off customer lock-in deals that guarantee a set rate for oil purchases during the winter heating season.
Tony Blair: A climate solution is in reach
The problem of climate change is almost universally understood and acknowledged. This is in itself an achievement. Now is the moment to get serious about the solution.Such a solution has to be global. It must include America and China. It has to be radical. It must put the world on a path away from carbon dependence to a new, green economy.
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And as if the supply and demand fundamentals of oil aren't enough to worry about, we have the precarious state of the US$ to factor in.
"Barclays Capital has advised clients to batten down the hatches for a worldwide financial storm, warning that the US Federal Reserve has allowed the inflation genie out of the bottle and let its credibility fall "below zero".
"We're in a nasty environment," said Tim Bond, the bank's chief equity strategist. "There is an inflation shock underway. This is going to be very negative for financial assets. We are going into tortoise mood and are retreating into our shell. Investors will do well if they can preserve their wealth."
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/27/cnbarc...
There's some discussion of this in yesterday's DrumBeat. Search the thread on Fortis for some prime financial doomer porn.
There's also this, courtesy of Gail.
Amazing that the first 3 posts talk about something that was nowhere
in Today's Drumbeat.
"financial doomer porn." I'm an addict. Intervention for me?
Do I have to go thru 12 Steps? ;}
I think it's partly a carry-over from yesterday's DrumBeat. We got hot and heavy with Fortis and Barclay's last night. ;-)
Good. Sorry I missed it.
Family bidness. :)
Should you be talking about your social life here? :)
Leanan pulled it out of me.
You're correct.
8D
Per page 2 of Gail's Reuter's article:
"They (FDIC) also seek to clarify how some deposits swept into a different investment product would be treated."
And they're not alone.
Level III Assets? Marked to Fantasy products.
When we find out the price, the price will be zero.
$692 Trillion (last count from the Fed) turned into a smoking crater.
This is a link to the FDIC Final Rule. It is basically about not giving depositors access to more than their $100,000 of FDIC insurance coverage, once the FDIC bankruptcy process takes over. It seems to me that this could have a very adverse effect on big companies, trying to make their payrolls.
If you want to avoid getting your money caught in the whole FDIC whirlwind. You can opt out (for the most part) by opening a Treasury Direct account.
http://www.treasurydirect.gov/indiv/indiv.htm
It's like opening a savings account with the US treasury. It seems to be the safest thing to do, this side of stuffing money in your mattress.
This is assuming you trust the Treasury..
And there's always Ilargi and Stoneleigh
Deafened by Silence
And this from today's Sunday Times
Back to the Great Depression?
Thanks, I'll go check it out
Peak Oil, amd/or the price is acknowledged.
The solution, Repeat failed conferences, the results of PO to be felt
in years, in decades.
Except for the lone articles like Scot fishing boats tied up, UK street smarts.
And except that Fortis , after RBS, and Barclays, says we've only got weeks:
"Fortis Bank predicts US Financial market meltdown within weeks..."
We have had no fewer than three major financial institutions (outside the US) call for an utter collapse of the equity markets in the last two weeks. The latest to join the foray was Fortis, which (in this translated article) basically calls for a collapse of the United States financial markets and a large number of banks.
RBS, Barclays, and now Fortis - the credit crunch is not over, it is not contained, and that it can't be contained."
http://market-ticker.denninger.net/
The explosive growth of the world population has been possible by the one-time consumption of fossil energy. We now have reached the top of the energy-extraction. The extraction of the remainder demands more cost and efforts for a lower output.
The lowering availability of energy will logically lead to a shrinking world population.
http://321energy.com/editorials/deruijter/deruijter062508.html
As energy declines so will the financial system that is based on it.
No worries. The huge offshore discoveries off Brazil are going to bail us out, and Brazil is talking about joining OPEC. One minor point. As of last year, Brazil was still a net oil importer (albeit just barely). In any case, at their current rate of increase in consumption, their consumption will increase by more than one mbpd in 10 years.
Yes, there may be a bunch of oil off the coast of Brazil. But there are 12 drilling rigs in the world capable of drilling to those depths (offshore). Brazil has 2/3 of those contracted.
Next problem: $600 a day and going up to hire one of those rigs. Temperatures so hot they'll melt normal pipe. Need million dollar drill bits.
What happens when you've spent $300,000,000 and get stuck in the hole and have to adandon the well?
Not quite so easy to move over and try again.
Let's say it takes 5 years to get something on-line. By that time Mexico is no longer an exporter. The price of oil, drilling costs etc, may be 3 or 4 times what they are today.
I'm not saying it won't happen, just that Brazil may be much more difficult than advertised.
You left off a few zeros on the daily rental cost, I think it is closer to $600,000. per day to rent a Deep water rig.
This is also going to be a problem in opening up us deep water drilling also.
See Touted US Offshore Oil Drilling Expansion Hinges on High Prices
with oil at $140/barrel and oil companies practically printing money?
Further down in the aforementioned article
and with oil at $200 or $300?
Keep chasing that rainbow. Someday you'll catch it!
"Keep chasing that rainbow. Someday you'll catch it!"
$400? $500?
Well maybe this..
http://www.bloomberg.com/apps/news?pid=20601072&sid=am42p9xBTXh4&refer=e...
.........
Oil prices backing off for a while, as demand destruction kicks in, will be enough to give pause to all these drilling plans. Soon the drillers won't know if they're coming or going. When discussing big money, lack of certainty is a killer.
No worries. The huge offshore discoveries off Brazil are going to bail us out...
Hey, let's not forget Kazakhstan as well.
Er, oops.
Fresh Kashagan oil delay sparks anger (Financial Times, so may require subscription)
The other detail is that they are pretty much maxed out on their pipeline according to this article. Until they get an additional pipeline agreed upon and built, even if they can produce more, the oil can't be exported. That is likely to push production off farther than 2013.
Nice link Gail, thanks.
WT, how is the venmex situation shaping? I recall you were predicting the US Gov to release from the SPR to remedy the situation by end of summer. You sticking with that prediction?
Or more accurately, that there would be calls to release oil from the SPR by Labor Day--specifically because of crude oil supply problems on the Gulf Coast. Of course, there have already been calls to release oil from the SPR--because of high prices.
I am still puzzled by the mystery decline in East Coast crude oil inventories of about 2.6 mb, and the corresponding increase of 2.5 mb on the Gulf Coast. It seems to me that some crude was shipped from the East Coast to the Gulf Coast.
It seems to me that some crude was shipped from the East Coast to the Gulf Coast
Jeffrey,
In our phone call, I mentioned that the quickest and easiest way to get extra crude to the Gulf Coast was to divert tankers headed to the US East Coast. Many refiners have refineries on both coasts.
Good chance this is what happened.
Best Hopes for no fuel shortages during a hurricane evac,
Alan
The Dutch article about Fortis is now 404, which means the Denninger translation is gone, too.
However, one of the TOD staff translated it before it disappeared, and I saved it for posterity here.
Leanan, what would we do without you--you are such a key cog and always on top of your game--THXS and HUGE KUDOS!
Do the Yeast have a Yeast as good as Leanan? I doubt it.
There is a lot of 'speculative froth' built into present prices.
Unfortunately it is in the price of stocks and shares, including banks, not oil prices.
If oil does not fall and stay down then the financial system must massively devalue.
There are a lot of good reasons for a high oil price.
Can anyone come up with a reason why airline shares are worth anything?
Because airlines will not dissappear altogether. If price of oil fails and at that time there isnt fierce competition they may generate some profit after all.
For the shares to be worth anything you not only have to continue to have aircraft flying, but to be able to maintain the present corporate structure, otherwise it is broken up and the parts sold to newcomers who don't have the overhead.
Aircraft were bought on the premise that they would be able to pay for themselves.
If you can only fly a third of them you are broke, as you owe too much.
Government fiddles might intervene - I expect the resusitation of the State airline - but for the US and UK at minimum the government will not have any money.
All sorts of scams will be tried, but the airlines as at present constituted are a busted flush, and quite worthless.
If they are subsidised into some sort of an undead life, they should properly be described as yet another government liability, not a asset will any intrinsic value other than break-up value for some of its most modern and fuel efficient aircraft.
what if you don't own the planes? what if you own the planes but have debt levels not that high? what if you can make it up by raising ticket prices up in other routes that are flying? what if you are hedging oil like southwest, which is making money?
That's not the airline industry's opinion.
They have said that the business model does not work at prices of $130/barrel.
That is industry speak for they are going to go belly up and are preparing the ground to ask for a government bail-out.
Some are obviously in worse nick than others, so if you really fancy it you can try to pick winners, perhaps including State airlines of oil producers, but don't forget that the airtraffic system has also been built with assumptions of certain volume levels, so that there is a lot of overhead hanging around.
Investments like Terminal 5 at Heathrow are also a liability, as they were built on the assumption that air-travel was going to be ever up, up and away.
Some bits and pieces will be salvaged, but there won't be much resemblance to current systems.
But of course you are working on the assumption that oil is not actually in short supply, and that prices will soon drop.
In that case you will be able to find some real bargains - I would suggest GM, Ford and Chrysler, and top up your portfolio with houses in the exurbs and penny-stock airlines.
I will await with interest to see how you get on - assuming you can pay your bills and so still have access to the internet, of course.
and we all know what good business people they are.
Actually, I think there is a possible business model for an airline based on using feul efficient turbo-prop aircraft. When the jet-based airlines go belly-up, the field will be wide open, and there will still be a demand for travel swifter than trains, especially in countries where a viable rail network capable of handling the sudden surge in demand doesn't exist, like the USA. The real winner in this paradigm change will be the manufacturers of turbo-prop aircraft.
In the very long run, airlines will share the fate of dinosaurs. But over the next 4-5 decades, a smartly run, visionary company like Southwest will likely become the monopoly carrier in a business that is really a natural monopoly, like railroads, and ripe for public ownership.
there is a possible business model for an airline based on using [fuel] efficient turbo-prop aircraft
Hi karlof1,
Care to quote some numbers?
Well for starters as we've discussed at TOD previously, turboprop aircraft use anywhere from 50-70% less fuel than jets, especially the shorthop 737-types. The fuel savings is where the meat is. Yes, turboprops aren't as fast, nor currently as comfortable. But if getting from place to place faster than trains is important, and especially when there are no trains going from particular places to places, for some time there will be airlines.
Government fiddles might intervene
Ding, ding, ding, you get the prize. We'll hear all sorts of rubbish about "multiplier effects", and how the economy would stop if business people couldn't fly hither and yon in order to "shake hands" on deals that they will do regardless because their spreadsheets, rooted in fiduciary duty, command them to do regardless of whether they fly at all. Oh, and, as usual, governments will not tot up the de-multiplier effects of the taxes required to pay for this nonsense.
I expect the resuscitation of the State airline - but for the US and UK at minimum the government will not have any money.
I expect the US will hand out lavish subsidies rather than formally establish a state airline. Lack of money will be no obstacle for the US or any other government, as they will simply 'print' it while steadfastly ignoring the unhealthy consequences of doing so. Again, gotta consider those imaginary "multiplier effects."
Nevertheless:
For the shares to be worth anything...
may still be an issue, because the interest of governments is in keeping affluent people flying, not so much in maintaining airline share values.
It seems that many here are unable to distinguish between bankruptcy and ceasing operations. Airlines have been on the edge of bankruptcy for the last thirty years. I remember that virtually all of them went bust in the early 1990s. People still flew. People will fly in the future as well, and airlines will carry them. Indeed, it might be a nice time for airlines in the future. Maybe they'll be able to make some margin, and also hire some pretty stewardesses like the old days.
There will still be aircraft flying.
The discussion was regarding what aircraft stocks are worth.
Intrinsically zero, overall, I would suggest.
External sources of funds will be required to keep any of them in the air.
Rather than just letting all of them go bust and having new players pick up the pieces no doubt all sorts of fudges will be used.
Personally I would bet on airlines from oil exporting countries.
Current airlines' shares should be worth near zero. Basically, they have liabilities in excess of their assets, and they cannot expect near-term profits to make up for it. After there are a number of bankruptcies and airlines have consolidated to accomodate the new, smaller ridership, then one might expect to see the airlines produce value for their shareholders going forward. Of course that assumes we get to a stable state, and that things don't go down from there.
"After there are a number of bankruptcies and airlines have consolidated to accomodate the new, smaller ridership,...."
but when and how will this happen ? the airlines have been running on free market, unregulated and half full planes for awhile. as i recall, the alledged 9-11 hyjackers targeted flights with half full planes and they didnt have trouble finding them(at least theoretically).
the airlines just keep loosing money, some are reducing flights - granted, but when and how is this adjustment to take place? probably not an example of a soft landing.
mr. infinite growth meet
mr. declining resources.
makes one long for the good old regulated days. sorry, i get more doomerish each day.
I have heard a couple times on CNBC that some people are short oil going long airline stocks. I heard someone say going long airline stocks is like owning an oil put(betting oil prices will fall) that doesn't expire.
... ummm ... sentimental value?
oil is a bubble. maybe a 1987 type bubble but still a bubble.
Tim Wood:
http://www.financialsense.com/Market/wood/2008/0627.html
you can't look at the oil chart and say oil hasn't gone parabolic.
A) all liquids production hitting a ceiling despite ample "incentivation" by price and time enough for new projects to come on line.
B) continued strong demand from developing nations which, in conjunction with a ceiling of production, forces demand destruction by price
C) peak and decline of light sweet crude: production switching to lower quality grades
D) a greater share of all liquids production being NGLs and ethanol, which have substantially fewer BTUs per barrel. Thus PEAK LIQUID FUELS ENERGY is behind us.
E) lower EROEI of the poorer grades of liquid fuels shows up as added energy demand (explicitly liquid fuels in the case of corn-based ethanol, less so for tar sands which are subsidized by natural gas). This, together with PEAK LIQUID FUELS ENERGY gives DECLINING NET LIQUID FUELS ENERGY available for all purposes outside of liquid fuels production.
F) peak, then declining net exports
G) rapid decline of the currency in which oil is exchanged (the US dollar), leading to outsized nominal increases in commodity price
Nope. No bubble here. Looks like fundamentals to me. As long as the above trends hold, we will continue to see similar increases. The wild card is declining demand from a general recession rather than from price increases. Will it outpace the above trends? And for how long?
BTW, I get around 2.4% monthly increase in price over 108 months to get us from $10.35 to $134. Rather than the 6% per month we've seen lately, which I am attributing to "catching up" to our longer-term trend. So I expect to see the monthly rate of increase drop back to the 2%-3% range shortly.
Your "shortly" still easily allows for $170 oil by November's election day.
Yes.
I personally expect we will settle into a trading range of around $150-170, give or take, through most of the rest of the year, ending the year near the high end of that range. Just my opinion, of course.
just look at the chart, there is NO REASON for oil to go parabolic. every condition that exists today existed from 1999 to late 2007 when oil went from $10 to $80. there is nothing to justify the movement since late 2007. there hasn't even been a significant correction in that time.
mr. woods mentions fundamentals.
Do you know what the Export Land Model is? Before you respond find out what it is and stop wasting our time.
That is 18 posts in today's Drumbeat by my rough count.
Are you really so vain as to think that you are contributing enough to this discourse to warrant 18 separate posts?
Wait, don't answer, that was a rhetorical question.
OK, let's try again.
The relevant measure for major oil importing countries is: the net BTUs of liquid fuels available for export. That is what they (we) are competing to buy.
While we here at TOD debate the exact timing of all liquids peak, the amount and quality of liquid fuel in the market place available to oil importers is already dropping. The peak that determines price is behind us and we are heading downslope.
That supply is being eaten away on three sides: net exports reduction (by far the largest component), lower BTU content of the mix of liquids produced, and the built-in demand required to produce liquid fuels from poorer resources.
And, again, if you plot the price of oil in Euros you still get a steady increase, but not at as great a rate, since the drop of the US dollar compounds the underlying price increase.
In mid-2006 through early 2007 we saw a crazy drop of prices from $80 to $50. That was not a stable situation, and to get back on our long-term track we need to revert to the mean (or the long-term trend) - which means a period of increase at a higher rate.
The question I find interesting is whether we will continue to see a fairly constant first derivative of price, or whether we will observe a second derivative increase required to destroy sufficient demand. Too bad this stupid housing debacle and credit crash is going to mess up our nice neat experiment. This is why economics will never be a science - you can't do controlled, repeatable experiments.
A rapid run-up in price is a necessary, but insufficient precondition of a bubble.
EDIT:
Eyeballing the graph from the article, we had $10.35 in January of 99 and $80 in, it looks like, July of 06. Close enough. 90 months. That seems to be about ... 2.3% per month.
EDIT:
If the 2.3%-2.4% monthly trend is more than just an artifact, we would expect to see an interruption in our recent rate of increase of nearly 6%. Price has a lot of upward momentum now, so it may crawl up a bit more before it breaks and consolidates for a few weeks, then resumes its climb at something close to our trend rate.
Doesn't Mexico's production and export decline as well as Russia production and export decline represent something new compared to 1999-2007? Don't the increases in demand every year from 1999-present represent something new? Or do you believe we can increase usage year after year after year after year forever and that exponential growth is really stability?
I always read the Wrap up and I must say I was disappointed this time. The human population is the bubble based on resource exhaustion. It is a shame an economically trained person has no idea about such a fundamental concept or chooses to ignore it. Wodd's chart analysis is so intelligent in general but as we have discussed elsewhere you can't use the same hammer on everything. Price charts have really no relevance with oil. The only relevant chart is probably an HL projection compared to population and consumption projections which are going in opposite directions. Maybe the price bubble will pop, but only due to government controls on who has access, limiting demand for an increasingly scarce resource.
Didn't your mama tell you not to lie? Had you said, "I believe..." but since you made a declaratory statement, you're lyin', cuz you don't know jack about squat, and certainly not the future...
http://seekingalpha.com/article/78264-commodities-prices-speculation-exp...
RE: Oil price a 'bubble'
That is an opinion.
Can you define your notion of a 'bubble' (what causes it, how was it built and by which mechanism it bursts).
Also, can you back this up with any data - not opinions?
I'm genuinely interested in this.
The Dutch article said that Fortis was expecting Citigroup and GM to go belly-up.
Seeking Alpha seems to have similar concerns, at least about GM...
53-Year Low: Re-valuing General Motors
I follow the GM bankruptcy story at thetruthaboutcar.com. I'm 97escort over there and put my two cents in on anti ethanol posts and sometimes other posts. I usually try to mention Peak Oil or ELM since hardly anyone else does over there.
Peak Oil is a big factor in the GM and Detroit 2.8 debacle. It may be the final nail in their coffin since they are so poorly prepared and in financial distress too.
Maybe GM should have more quickly developed hybrids rather than those fuel hungry E85 vehicles? Even the farmers in my area, South Central Illinois, grudgingly admit the fuel mileage suffers.
Maybe they shouldn't have destroyed the EV1.
They can rot as far as I'm concerned.
Can we please give the EV1 a rest?
It was a horrible commercial failure. That's why it was killed.
http://www.thetruthaboutcars.com/
Yes, funny and knife sharp wit with nobody to answer to. A few writers seem to be PO aware. They love to tear into ethanol. Although they have not quite resolved a position on the hydrogen hoax.
GM deathwatch, Chrysler Suicide Watch, and Ford Death Watch.
There is also the Tesla birth watch and death watch. This is especially funny to have both at the same time.
The real question is whether GM will survive long enough to introduce the Volt and other efficient cars that will not be profitable for some time.
There are also some anti-environment jerks and Prius bashers there. They can't stand fundamental change in the Detroit phallic theology.
Now an interesting place to go to is autobloggreen.com, which has a few trolls but certainly is watching alternative motoring developments closely and reporting quickly.
I've bee trying to figure out where it was that I first saw the words "Peak Oil" and it was either www.autobloggreen.com or www.evworld.com. I developed an interest in green transport technology and EVs out of concern about AGW and ended up here! Autobloggreen really does stay on top of all things automotive and green from new batteries to alternative fuels to car sharing arrangements.
Alan from the islands
Big Auto, Big Airlines, our country is full of industries that we have been taught are too big to fail. By protecting those, we have endangered the entire world economy.
It's like making the Titanic unsinkable by loading it full of elephants.
Mish has an interesting analysis, too:
GM Deathwatch
GM doesn't have the product line, nor the time to make the product line, before they run out of cash. He thinks the only solution for them, once GM's credit rating is officially downgraded (they along with the other two domestic manufacturers were put on credit watch just this last Friday), is a government bailout.
Before anyone responds with how fantastic the Chevy Volt is going to be, please look up how many cars that will represent of GM's total sales and what year they are expected to begin selling if there are no further delays in its release.
-André
www.PostPeakLiving.com
I've been thinking for a while now the first US car company to declare bankruptcy will have a huge advantage over the others. All 3 are on the ropes. A deep recession (let a long a depression) may kill all 3 of them.
But how many of them will the government try to bail out? My guess is only the first one. So, it is a race to bankruptcy, with the prize going to the first to declare.
To add to your argument, there might be lots of non-automaker competition for bailouts that could arrive in Washington first... major airlines, more of Wall Street, etc. If other major industries get to the soup kitchen window first the automakers may find generous support hard to come by.
Car ownership is so high in North America that there's a lot of room for downsizing the family's auto fleet. One or two cars per family would be a relatively low pain transition for many facing reduced income and spiralling costs and could be done in a very short period of time. It would also crush the auto industry and flood the used car market, not to mention signal a major cultural shift.
As Gas Prices Rise, Teenagers’ Cruising Declines
http://www.nytimes.com/2008/06/29/us/29teengas.html?_r=1&ref=us&oref=slogin
The Volt is a step in the right direction, but too little too late. Still to much of holding onto our 'american way of life'. As cars will become a smaller and smaller part of our lives in the PO world.
GM will have a hard time overcoming the the Prius. It is here, it is now, it works really well, and it is inextricably linked to the thought of anything with the word hybrid.
clinging to the american way of life is an ICE car, not a plug-in hybrid car that goes the first 40 miles without needed ANY OIL. it's a radical departure from BAU. if the mall or your work lets you plug-in you'll hardly need any oil.
really? what about modern health care? anti-biotics? vaccinations?
Them, too. mcgowanmc didn't say "exclusively responsible."
but I've heard that argument plenty of times and nobody every says anything about the other causes, ever.
Necessary technologies to get where we are today, but not sufficient without cheap energy.
indirectly they are. without the aid of fossil fuel's in the society at that time the people who 'invented' or 'discovered' them would not of had the jobs or education they needed to understand the world.
fossil fuels gave us a /one/ time ability to shift a large amount of people from simple food production to other jobs while supporting allot more people then the same amount of land would otherwise support.
Before the vast wealth produced by the early robber barons began to be redistributed to the citizens by public health programs, public university research, and a general reform movement, poor people lived like dirt in cities and farms. Average life expectancy in the US in 1900: 40 years. Laissez faire was already losing its sway due to mass disgust. Now we've turned the clock back to neo-Victorian ideology, so the economic/energy crisis will be used to further degrade public health, sanitation, vaccination, and even simple education. Turning millions out of the city to grow food the low-energy way would make that all much worse, so I pray it doesn't come to that.
If john15 doesn't believe that can happen, when the USSR fell and the gangster capitalists (with a lot of Americans along for the ride, according to www.exile.ru) raped the country, life expectancy for men fell from the mid-70s to 59. It would still be getting worse without the strongman and the oil. A lot of Russian men drank themselves to death, apparently. A lot of American men will be too weak to do any better.
Don't forget the Afghani heroin. Yes, the same sort of ideology exported to Baghdad was first sent to Moscow by Bush I and Clinton, but mostly by the latter. The Rape of Russia Congressional testimony makes chilling reading. My post at the bottom of the thread exposing the fact that the same number of people are impoverished today that constituted a crisis and prompted a major policy speech by FDR during the Depression also hints at the disturbing fact that like the poor and mostly colored unfortunates of NOLA they are seen as un-people, or rather not to be seen at all--ignored like the person with a cardboard sign at an intersection. This board can become very impersonal at times and many forget that the people we talk of undergoing demand destruction could very well be us given a slight change in circumstances. I think that's what horrifies poor john15; he wants to believe there's some panacea-like fix because he cares about his fellows, unlike some of the doomers posting here, who wouldn't lift a finger to help their own kin.
If you have children, do you look at them as meat for the table, or something to be protected, loved and cherished; the socioeconomic system we've engineered looks at them as the former--meat for the gristmill--and cares nought for sentimentality. We have become Dicken's world on steroids. And only we can save ourselves from ourselves.
I don't think those things will do much for you if you don't have enough food to eat to keep you alive. The green revolution that allows 6.5 billion people to get enough to eat is absolutely made "possible by the one-time consumption of fossil energy". Without that, the 2 or 3 billion people inhabiting the earth might have good health care, anti-biotics, and vaccinations. But the explosive population growth would never have happened.
how are you sure that w/o fossil fuels(by that I"m guessing you mean oil) we wouldn't have had the green revolution? what about wood gas? what about steam? what about electric tractors?
I'm sure, look at how many people the world supported before we started using fossil fuels.
but we now have knowledge, that the fossil fuel age gave us. So I believe that the future will not look like the year 1800, but more like 1900.
In 1800 it took two to three weeks for a message to get between London and New York. By 1866 it was less then 1 hour, but it still took two to three weeks to travel that far.
It's getting there that's going to be fun (NOT)
Ed
"what about electric tractors?"
This is getting ridiculus
no it isn't. there were 1600 electric ploughs operating in WWI era germany.
http://peakoildebunked.blogspot.com/2007/12/317-electric-agricultural-ma...
And how did German electricity get generated? Coal. Leaving aside the vast expense of electrifying the poorest countries on earth so they could raise cheap plantation crops for your refrigerator, the sheer scale of the Green Revolution would have required either oil, coal or nuclear power. Think about some of the governments involved in the Green Revolution, then thank God the nukes didn't get built.
you don't know that. if we electrified farm machinery chances are that could have driven up the cost of electricity and we probably wouldn't have all the little electronic toys we have today. classic demand destruction.
Modern health care has not been important in causing explosive population growth. Antibiotics and vaccinations have been minor. Better food production and distribution and better sanitation have been the most important factors.
"Modern health care has not been important in causing explosive population growth."
http://www.pbs.org/wgbh/amex/influenza/
So are you implying that due to modern medicine another 1918 flu epidemic (black swan) could not happen again in a population with no resistance to a new virus? Bad choice of an example to back your argument.
of course it could. but you don't know if say AIDS-HIV was that disease but modern medicine won't cure it. if we are going to talk black swan, we don't know who the million, or even hundreds of millions, of people are that were saved or might not have been born if not for modern medicine. in fact in the spread of disease these days the main threat seems to be lack of education or prevention.
Huh?
Conjecture, which is what most of your posts rely on. Then you torpedo your own argument by saying it is social services rather than medicine. OK.
And impoverished governments have been strongarmed by the IMF and World Bank to wipe out their social programs and public education so as to cut taxes to encourage Western corporate investment. Pakistan's generals chose to wreck public education (as opposed to, say, cutting money to their A-bomb program), and Saudi extremist missionaries rushed in to fill the gap. Happy with the results? It's going to be worse with governments overrun by food riots and fuel riots and bank and stock collapses.
http://en.wikipedia.org/wiki/Spanish_flu
(I've included whole sentence to avoid claims of bias, but clearly the first part is the relevant bit.)
So the "first-order" effect on gross population was limited to those who died before producing offspring. It's not convincing that 20th medicine actually keeps significant numbers of people alive to reproduction ages to affect population level; there's a better case that it "just" makes living much more better due to ameliorating chronic conditions. Likewise, vaccination is more about keeping individuals alive with people otherwise having more offspring to replace lost children.
(People tend to forget just how difficult it is to actually die of an infectious disease once people get medical attention. A 20 percent mortality rate is considered huge and it's a terrible waste of individual life but it's not making much of a dent in population levels.)
I'm not saying medicine isn't important, but it seems orders of magnitude less important for gross population levels than being able to provide food and sanitation.
The explosive growth of the world population has been possible by the one-time consumption of fossil energy.
==========
really? what about modern health care? anti-biotics? vaccinations?
Arguably, the science that enables all of that is an result of the replacement of human and animal energy with external sources, of which fossil fuels are the most important, freeing up human resources. When agriculture requires 50% of the workforce, and construction another big chunk, and transportation of manufactures, etc, the effort that can be put into medical research is going to be limited indeed. Maybe we would have gotten there eventually, but it certainly would have taken longer.
Now the question is how to hang onto it if the availability of oil and natural gas declines sharply...
Have you got no idea how systems work with internal feedbacks?
Care to read 'Collapse' by Jared Diamond or 'Collapse of complex civilizations' by Joseph Tainter?
If you understand economics, I recommend the paper 'Usable Physical Work' by Ayres.
They all point to the same conclusion, simplified here as a causal chain:
Energy surplus
-> Free time
-> Higher education
-> More discovery
-> More inventions
-> More technology
-> Less manual labor
-> Longer lifespan
-> Longer travelled
-> Economic growth
-> Higher energy usage
-> Globalization
-> Longer travel for people, goods & services
-> weaker local independence
-> weaker local resiliency
= Progressively increasing complexity
= More dependence on an energy surplus
-> Requirement for a growing energy surplus
Now, start constricting progressively total energy, usable physical work and energy for mobility.
Imagine what can happen.
It's all about energy.
to memmel and others ;)
I tend to agree more and more that is good that people remain in the dark about consequences of peak oil. It depresses the hell out of me, occasionally, and people (me included) don't perform good when depressed.
People need to be joyful and optimistic about their future. For example, if every young person decided not to work, since there is no pension for him/her in the future, we would crash immediately. Young people today generally KNOW they are not getting anything when they get old, but they continue to work. Which is more, a young person today values the type of work over the money, which is basically good for an indivudal and for the society.
IMO the financial meltdown and probable profound reform of the society is quite near. Bubbles that we witnessed in the last years, were last big ones in which the elites took what the could from the lower classes. Elites know that we need to reform and they will cause it deliberately in few months/years.
Elites are like viruses, but smart viruses keep the patient alive for as much as possible. I don't agree with majority view here on TOD that politicians are dumb. The Iraq move is a great move for the future of USA. I despise the idea, but realpolitik is what it is.
If elites thought that there is any option to save the society as we know it (more or less) they would work in that directions.
The last big bubble is going to be oil. Financial meltdown can lower the price of oil quite substantially. Of course there is going to be high unemployment (at least initially). The oil is peaking, agreed, but there is a whole lot of oil to be extracted.
Unemployed will go to military, actually this process has been under way for some time now. USA will continue to be the greatest force in the world, fuelled by cheap oil. Middle class will of course dissapear.
American suburbia will become rest places for military people, when not on front. I am quite suprised nobody mentions this. It was all a grand plan from the start. Since military will be broke, they will need some cheap housing.
The last big bubble will not be oil, it will be the worlds population (crash and burn).
It totally destroyed me yesterday. I made the bad mistake of reading the news - and here I am doing it again. I had some organizing work to do in Scarborough - on Payne Road - where I'd not been in some years because I avoid malls. When I first moved here 25 yeaers back Payne Road was empty but for trees and meadows. Yesterday it was wall-to-wall cars, big boxes, traffic signals, traffic jams, SUVs - a complete ecological, financial and social disaster. Information has become toxic. To protect ones self, one must maintain ignorance. That, of course, makes it impossible to develop real answers.
One thing that's becoming very clear to me is how connected the financial and energy meltdowns are. It really is about "full planet". Climate change, environmental toxicity - it's all about "full planet". Commodities are no longer limitless - assuming one is willing to produce more; they are all becoming scarce - no matter if one tries to produce more. Overshoot. We are too many and we've taken too much already. I bet the rear-view mirror will put the data around 1970ish - Man on the moon - just as the famous graphic on dieoff does.
As someone pointed out last week to me (maybe here), the only way to deal with a failed economy - and this is a failed economy in the greatest sense, environmental and ecological as well as stuff-from-china - is a police state. I'm working on a pushback to US Real ID system; that is nothing but a mechanism for allocating resources and maintaining order. A very statist solution that will not work except for those in control; everyone else is going to be so screwed. But for now, because it will first start denying economic resources to immigrants, Muslims and pedophiles, so many people think it's just fine.
cfm in Gray, ME, Milliways
Poignant observations, thank you. I wish they were more unique, but they're not. I share your concerns about the coming police state.
Yup, this hobby was a whole lot more fun when it wasn't so freakin real. I use to to scan the drumbeat to see if the mainstream press would pick up on peak oil.
Now it is hard to look at them at all. Just to depressing.
Bitteroldcoot - "Just to depressing"
http://lawnstogardens.wordpress.com/2008/02/19/peak-oil-is-here-how-youn...
There is a young guy next door to me that just purchased a brand new BMW M3 on a long term lease. I know he commutes to Orange County (35 miles each way) so obviously he's betting on gas prices either coming down or stablizing. I thought about mentioning gas and peak oil but then I thought 'Why be a prick?' Instead I told him, "I love those low profile tires".
People have to wake up when they're ready. But for anybody who is now peak oil aware there is no going back.
I have a very clear impression that Swedish political and economical elite are doing that and our nordic neighbours seems to do the same. And it is a natural thing to do, we have lived thru good and bad times for manny generations and if the king and his staff did not deliver good statemanship he and them were replaced one way or the other. Who would want to live in a failed society or leave a faild society to the grandkids? Obviously bad statemanship is a sure election looser.
I am slowly learning how our political system works due to my supportive job as a party employee in our parliament. My impression of our political system including lobbying etc is that it tends to create investment opportunities rather then finding ways of bleeding capital to party on.
Our political system has to a large degree been focused on buying votes with subsidies and creating government jobs with questionable productivity and this toying with socialism has hurt us. Parts of this has been rolled back by the socialists out of economical necessity and other parts are now being rolled back by the center-right coalition. And it works, government institutions resists change but change is being done, subsidies are lowered, taxes are lowered and new jobs are created. A large part of the new jobs are in local services, physical production and booming physical investments in energy etc. A lot of the environmental investments has been very good for energy security and this synergy continue to be strong.
One of the biggest political issues is how the record high government surplus should be spent. Its a fight between the finance who would like to minimise government debt, wich tax reductions would be best for stimulating growth, that is more jobs and change, a very strong lobby for more road and rail investments and old and new spending areas with everything from environmental work to subsidies to poor groups and hidden among the important stuff there is spending that could be cut.
I find it reasonable that we could continue cutting old socialist baggage and making the job market etc more agile for about a generation. Since we also have an ok infrastructure well into reinvesting the wear down since the 60:s, plenty of electricity and attractive goods to trade for the post peak oil period it could be period of change like other periods of change during the 1900:s. Although it is reasonable it wont give a net increase in the tonnage of consumption but rather a gradual change in what is highly valued.
USA is regarded to have one of the words most dynamic populations, markets and cultures. You ought to be able to build on that to handle an era of change as we can build on the parts of our government and businesses/markets that works well and handle change in a productive way. When you do things you seem to be quick like when you built up the ethanol industry, it were not the best idea but when you moved things happened fast.
But there are things I do not understand like why your huge automotive industry has had a hard time reinventing itself and rather then having a "silicone valley" in car innovation you stick with old dinasours and depend on foreign companies for innovation. But there might be realy good things following the creative destruction of companies that are unable to adapt fast enough. We have front row seats here in Sweden since Volvo(Ford) are downsizing the production due to making too large cars for the US market and shedding people that so far have a good labour market. Saab (GM) seems to be ahead in downsizing the car size and both of them have hybrid initatives. Will the smaller cars and hybrids be ready and start to sell fast enough? Will the labour market be dynamic enough for hickups or failures to not give high unemployment? The government initiative for handling this is mostly large subsidies for medium and long term RnD and skill building of the workforce. Wonder who will pick up the opportunity if Ford or GM fails?
But hey I am kind of in the elite in a junior way and it might all be smoke and mirrors. 8-)
Congratulations. I hope Reaganism does as much for your once-compassionate society as it has done for the United Corporations of America.
As your private property system is left untethered to concentrate wealth in the hands of a very few, those very few will do what they did in America after 1968. They will form brainwashing lobbies (our were the Coors, Scaife, and Olin Foundations) to teach even greater hatred of the poor, and advocate ever-greater tax cuts for the rich. Then that money will be used to teach that environmentalism is a fraud, and advocate eliminating the pollution controls for further profits. Then that money will be used to fund a revival of extremist religion, which will teach the new poor to hate anyone who criticizes the rich. This will destroy the unions, which will collapse wages, so that the poor will work longer hours to compensate, thus depressing labor markets. Eventually your citizens will be too stupid, superstitious and fearful to understand why global warming is not an act of God. The few will own everything, before it all goes up in flames.
There is no moderate capitalism. It's all or nothing, winner take all, baby.
I must echo what super390 said, Nodic socialism has inefficiencies that can be spotted and deleted, but socialdariwnistic capitalism of the American and British varieties is EVIL, primarily because it promotes competition instead of cooperation as the ideal. Thus everyone is at everyone else's throats. The bloody tooth and claw descriptions from the late 1800s and early 1900s has been coated with euphemisms to hide their reality, but the system still operates with the same brutality. For proof, just look at what the USA and its NATO surrogates did to Serbia and Afghanistan, and then gaze upon Iraq and Haiti. Unlike Norway, Sweden was lucky during WW2 and afterwards. Then Norway got lucky with the North Sea discoveries. Ask yourself, How would we in Sweden have handled that? I find it very intriguing that Norway's richest man, Jon Fredricksen, the shipping magnate, felt he had to renounce being Norwegian and take Cypriot citizenship because he wasn't rich enough. He is Faust. The UK and USA are Faustian; look where they're headed. The EU seems somewhat saner, but it also teeters on the edge of becoming Faustian, too. The NATO aspect of it already is. Taken to its ultimate conclusion, Capitalism has no winners, only losers. Sweden is lucky that it still has a choice; it should choose cooperative life over servile death.
I agree that capitalism has its excesses, but you cannot say that currently it isn't the most efficient system. Capitalism would be extremely successful through the eternity, if there weren't many different bottlenecks like oil.
Now with those bottlenecks it will have to adapt. The problem is - the transition period will be some pretty rough ride. Predatory nature of capitalism simply does not care for others, yeah, but that's life. Sure a person or a small country can have (limited) success without being an asshole, but a superpower needs to get everything it can.
It is true that elites need the masses to stay uneducated but hey, that's really easy thing to do. People don't like to be educated and most can't even understand pretty simple mathematics and logics.
Of course I am pretty pessimistic about future but somehow I have stopped to really care about it,though I like to speculate. If I had children, I don't know what would it do to my psyche. Maybe nothing, but then again I can't really feel it until I actually have them.
And markets with real competition where new people can enter the market are very good at adaptation. But the result do of course reflect the moral of the participants. Cultivating good moral is slow work that can be done in manny ways. Capitalism needs good institutions and a sound legal system preferably run by a democracy where people care about minorities.
This week's New Scientist is a "Peak Oil" special. One of the articles was linked in yesterday's drumbeat and I posted a link to the editorial. Also in the issue is an article by Matt Simmons. Behind a paywall (buy the mag if you can) but here's an extract.
Time to go cold turkey
The letters page should be interesting in upcoming editions.
One of the key problems is the ingrained assumption--due to a large degree to the assertions from ExxonMobil, et al, that we don't have to worry about Peak Oil for decades, worst case--is that high oil prices are temporary, or the absolute worst case, they stabilize.
I think that the price of oil remains a horserace between declining net oil exports and declining demand, but one thing that I don't expect to stabilize, at least not for a long time, is the volume of net oil exports.
I think that we are seeing periods of brief stability, with supply & demand in balance, and then net oil exports fall again.
This is why I do not believe in either fast collapse or slow collapse. What I think we'll see is "punctuated equilibriumn", to borrow an idea from evolutionary biology. Extreme efforts will be made to preserve the status quo. This will work until it doesn't any more. Then you'll see a rapid but brief decline, until enough demand is destroyed to reach another period of equilibrium. Rinse and repeat.
For a continuous transition, we would need people in power who can see the need for change and work to make the change happen. The world doesn't work that way. TPTB got to be powers because the status quo is beneficial to them. To a large extent, their very purpose for being in power is to preserve the status quo. They will fail, and change will be discontinuous.
Your description is similar to that of Greer's catabolic collapse...a series of steps down, interspersed with periods of 'normalcy' at lower levels of complexity.
I was listening to BBC radio 4 news last Friday and heard Alan Duncan (Conservative MP who was a former oil trader and is about as mainstream as you get politically) saying that roughly "Prices are higher than supported by fundamentals now" but in response to a direct question that "oil in a year will probably be around the hundred dollar mark and will stay there for a while". What struck me was that he seemed to be saying that higher oil prices would soak up more of people's money, but not suggesting that dramatically different alternatives need to be entertained.
WT -
Why would the stablization of prices be a bad thing? I see dramtic shifts in the way people relate to driving and living because of the high cost of gas. Isn't demand destruction and conservation an opportunity for a soft landing?
Because Britain is insolvent, and the vast personal debts can never be paid back in an economy in permanent slowdown.
Moe_G thanks for your comments yesterday.
Paul.
Thanks for the feedback, Paul.
Isn't this special (linked on Drudge):
http://www.telegraph.co.uk/news/worldnews/middleeast/israel/2212934/Isra...
Israel has a year to stop Iran bomb, warns ex-spy
Last Updated: 10:42PM BST 28/06/2008
With talk like this, we might make $156/bbl by the Fourth. And PG will have to put up another poll.
I think the novel was "Last Blade of Grass", where the powers that be nuked their own cities. In that particular story some virus was killing off all species of grasses. As the impending famine became obvious to the rulers - and still largely hidden from the population - they called in the bombers.
A massive mercy killing/culling.
I wonder if a "limited" thermonuclear war doesn't appear exactly the right ticket to authoritarians like Cheney. Actually, no need to wonder - there have been studies done with the "World Change Game" and that is exactly what the authoritarians did - repeatedly killing off multiple billions of people. [references in Bob Altemeyer's "The Authoritarians" and Dean's "Conservatives Without Conscience"].
cfm in Gray, ME, Milliways
It was called "The death of Grass" but the US title was "No blade of Grass".
http://en.wikipedia.org/wiki/The_Death_Of_Grass
Classic doomer porn.
I was struck at how prescient John Christopher was. Just replace grass with oil and he could have been writing about right now. Scary.
westexas -
For quite some time now Israel has been making not so vailed threats that if the US doesn't 'fix' Iran and fix it soon, then Israel will do the job. What really gets me is Washington's almost total acquiesence to this threat. The attitude seems to be (said with a shrug of the shoulders): 'Well if that's what Israel wants to do, then there isn't much we can do about.'
What disgustingly deceitful rubbish!
The only route open for Israel to attack Iran is by flying over Iraq, whose airspace is totally controlled by the US. If the US really wanted to prevent Israel from attacking Iran, it meerly has to inform them in no uncertain terms that any Israeli overflights will be considered a hostile act and will be met with the full weight of US air power.
Furthermore, the US could also inform Israel that an attack on Iran will automatically result in an immediate and permanent cut-off of any further aid to Irsael, which has been running at some $3 billion annually (the largest given to any country).
Of course, there is no chance in hell that either of the above will ever happen, and with this being an election year, the reason why should be painfully obvious. So essentially, the US has already given Israel the green light to attack Iran. The fix appears to be in.
The neocons want to attack Iran every bit as much as the Israelis. I wouldn't be surprised to learn that the neocons have been pushing the Israelis to attack, on the grounds that another war of agression launched by the US isn't politically palatable (though you'd never know that from listening to the US Congress). However, if Israel does the agression and the US comes to the aid of an ally, that might be another matter entirely.
Drudge has a link on a new story by Hersh on the continuing battle between Cheney led Neocon faction and (most of) the Pentagon, regarding an attack on Iran and on US efforts to undermine the Iranian government: http://www.newyorker.com/reporting/2008/07/07/080707fa_fact_hersh
As we have discussed, Admiral Fallon's forced resignation was not a good sign. I still think that one of the most interesting tidbits of information was Bush's decision, earlier in the year, to fill the SPR to its current capacity by October (Congress has since forced him to stop).
Hersh:
I'm very concerned that the idea of a blockade might be viewed as a "compromise" between the people who want to bomb Iran and those who don't. A blockade is an act of war just as much as bombing, and I can't imagine Iran would sit back without retaliating in some fashion. Even worse, what happens if a Chinese-flagged tanker decides to run the blockade?
I shargash your concern.
I have been following Cheney's pushes for war and there have been at least 4 major ones as best I can tell. They all start with articles written by Michael Gordon in the supposedly left wing NYT.
The first was when they tried to link the Israeli war against Lebanon with Hezbollah and Hezbollah with Iran--- this was a non-starter-- too complicated for the American people to understand.
The second was when they tried to push the idea that Iran was providing the IEDs for the Iraq insurgency. General Pace said "No we have no evidence to confirm this."
The third was linked to the capture of British sailors. Fox News tried to get the American people worked up but they simply weren't American and Fallon just wasn't cooperating.
The fourth was quite serious. They passed the Kyle-Lieberman bill and Cheney wanted to push to bomb "terrorist camps" on the border. The NIE report came out and took the momentum out of the campaign and Fallon again was not cooperating.
This is the fifth push. Now we have Special Ops in Iran. A blockade bill in Congress and no Admiral Fallon to stop the war. Cheney is like the T-Rex testing the electrical fence in Jurassic Park. He is looking for the weaknesses.
I hope the fence holds him but this bill in Congress seems like the weakness he needs.
No, No, No. You can't have another war until you've finished your first two.
That sounds too much like the German general pleading with Hitler not to open up a second (Eastern) front. But, I suppose that was your point.
What sort of idiots would go to war with Iran and risk the economy going bankrupt and the sources of oil destroyed or damaged?
Unfortunately perhaps the very same idiots who went to war in Iraq without a game plan of how to occupy and control it.
I don't think of the NeoCons and other US leaders as idiots.
I do think that there is a "wreck it and run on to whatever happens next" kind of desperation among our civilian leadership.
"Wreck it and run" -- this is the new management policy in business amoung the corrupt crony capitalists. This is also the economic policy, foreign policy, energy, food, and security policy of our political leadership.
Remember that phrase, folks: "Wreck it and Run."
The leadership we have carefully cultivated over the years is psychopathic. The concern is now to steal resources in any way possible while watching for opportunities to move on to new targets. Any debts or costs are simply someone else's problem if one can grab and hold control of vital resources.
Such policy is clearly homicidal, but is ultimately suicidal as well. We are wrecking far more than can be fixed, and will find the various kinds of blowback -- geopolitical, yes, but mostly environmental -- to be far more than can be managed.
We are cunning Killer apes (Jay Hansen) at Peak Resources and we Kill Off anyone or anything to get our next fix. Our leaders likely do this simply as a compulsive behavior. Most of us play for smaller stakes, at least in our own minds.
I note also that the myth of capitalism as a kind of magical world where self-interested people operating for their own self-interest results in peace and prosperity is imploding.
The Killer Apes who benefit the most always rig the system to externalize costs and internalize profits -- whether if that means killing off the network of species that make life possible for our species to survive on the planet, or whether that means various forms of slavery and genocide within our own species.
I think that there might be some evolutionary possibility out there in the future. Maybe evolution to a cooperative paradigm or mutuality with an eye to maintaining a hospitable environment for generations. But that seems problematic. We are reverting to very primitive and destructive behaviors with very powerful technologies at our disposal.
One does what one can, even so, I suppose. I myself have been working very hard for too few American dollars, it seems lately. I need to go out and finish building some wood window screens promised to a client before the month ends. Meanwhile, the leaders of our business and political system will manage to guide us into Armageddon, by hook or by crook. Good Shepherds, all, no doubt.
I have to agree with beggar.
Psychopaths is a more apt description than idiots.
If I had to name the most important architects of the war it would also be the people that profited the most.
Cheney- Halliburton and Lockhead
Bruce Jackson-Lockhead
James Woolsey-Dyncorp
Richard Perle- Trireme
George Schultz- Bechtel
They have personally made millions from this supposed fiasco.
The incompetency theory is being pushed by some of the same people that also advocated for war: Richard Armitage, Patrick Clawson, Richard Haas, L. Paul Bremer.
We've got to drive a stake through the incompetency theory. It let's greedy psychopaths off the hook.
IMO a lot of people are afraid to let go of the "idiot" theory. The whole premise that there are wealthy, powerful Americans working together against the interests of the country is terrifying to most people. What I just wrote is a "conspiracy" theory-everyone knows wealthy, powerful Americans only work together for the good of the USA.
I am glad that you came to your senses. I was just about to report you to the new HUAC committee that is forming:)
I'd got for both psychopathic and idiot personally.
I think they genuinely had no idea that their fantasy of taking over Iraq without substantial 'boots on the ground' was a product of wishful thinking as opposed to realistic calculation.
They had hoped to have moved on to Iran, and for all I know, Mars by now.
Due to their miscalculations they are now engaged in a desperate attempt to go for a last throw of the dice, and strike Iran so as to mobilise the country behind them.
Thus they would hope to divert the anger of the people, who with the collapse of the access to cheap oil and with the financial system sacked might otherwise place the blame where it belongs.
Already the British Government is trying to argue that the present financial melt-down is due to factors outside its control, which no-one could have predicted, like an oil shortage, for instance.
War is one good way of distracting attention from the elites' systematic looting and embezzlement.
The idea that these people are vastly competent though seems to me incorrect.
They are incompetent, and not good at waging war, as well as peace.
Their fantasies and greed see to that.
The last bunch as nuts as this were running the Third Reich.
I like the phrase "wreck it and run"...sounds better than "starve the beast", though the meaning is the same. "The Authoritarians" is a really eye-opening analysis. Psychopaths rise to the top...they are the only ones interested in controlling everything. This is all very depressing when you contemplate it too long. Used to be an abstract issue to me...now it is becoming all too relevant.
You can't have another war until you've finished your first two.
Finish the first five wars:
War on Iraq
War on Afghanistan
War on Poverty
War on Drugs
War on Terror
I might be missing a few (not necessarily in order), please expound.
Don't forget that we ousted the government of Haiti and conned others into being "peacekeeping" forces, until the effort collapsed. We also got Ethiopia to invade Somalia, and got it stuck there, with the occasional US airstrike. Then there's Pakistan.
Good point, especially in light of the the sanctions that crippled Iraq during the 1990's. The sanctions led to the deaths of something like 500,000 Iraqi children, who perished from More shocking was the callous reaction by the Secretary Albright of the Clinton administration.
Iran has to be well aware of this history.
"We think the price is worth it"
shargash -
Well, what you said gets back to my whole point. And that is: any attack by Israel on Iran will have the full approval of the US because it is within the power of the US to prevent such an attack, if it really wanted to. And the fact that the US has made absolutely no move to tell Israel that it will not allow an attack on Iran clearly indicates that if there is an attack, the US will be fully complicit even if it does not partipate directly.
And it is true that certain factions in the US (led by Joe Liebermann, the senior senator from Israel) do want an attack on Iran to take place. But those people in power that do not want such an attack have been largely silent.
I was aware I was agreeing with you when I posted my comment. :) I just wanted to make a stronger statement. If I count correctly, every war of the young millenium has either been started by the US (Iraq, Afghanistan) or by a US proxy with the urging and support of the US (Israel's invasion of Lebanon & Ethiopia's invasion of Somalia).
If you check the personal histories of the leading Washington neocons, you will see that many of them have worked for the Israeli government or the Likud party. They worked on the influential "Clean Break" paper that called on Israel to move to the right economically and to deal with Iraq. They are a conspiracy that moves freely between the governments of the US, Israel and Britain, each vouching to the other for these bastards' "expertise".
Or maybe it has nothing at all to do with this being an election year, but rather because the US really wants Israel to attack Iran. Such a war diverts attention from the USA's rapidly escalating economic problems. World oil prices will skyrocket if there's a war, but it's so much better to blame it on Israel than for America to take the responsibility for years of disastrous policies.
Consider this...
It's pretty much universally agreed that a naval blockade is an act of war. I guess that if the Israelis don't do us a favor and bomb Iran soon, we'll just have to do it ourselves. Of course, we'll only attack if the Iranians fire a missile at an "innocent" American aircraft carrier (that was blockading their ports). Such an act of Iranian aggression would necessitate an American military response.
The USA will not make the same mistake in Iran that was made in Iraq (tying up US troops for years in a hopeless occupation). A swift nuclear attack, Tehran a smoking ruin - definitely more cost effective.
If we nuked Tehran, the world would never forgive us.
Yes, but the world won't punish us fast enough for the American people to learn the lesson. The capitalists in most of the world will hold their noses but prevent any real state-level punishment because America is the sword and shield of capitalism - if it falls, all capitalists are endangered. Ordinary outraged citizens have no real voice these days anywhere on earth.
If the Israelis attack Iran, all shipping in the Persian Gulf would stop. US forces in Iraq would be starved of supplies - especially oil.
I cannot see how they could operate with insufficient oil - a sort of Stalingrad-in-the-sand scenario.
Alfred - "If the Israelis attack Iran...a sort of Stalingrad-in-the-sand scenario."
I really like the "Stalingrad in the sand" metaphor. I've recently finished Dmitry Orlov's book "Reinventing Collapse" (reviewed by TOD) and in it he argues that a quick collapse is preferable to a slow agonizing decline. One of the aids to collapse are "Boondoggles" employed by the U.S. Government/Military and corporations.
The invasion of Iran would be the Ultimate Boondoggle.
In the 1950s Albert Wohlstetter out of Rand and the University of Chicago wrote extensively about the use of strategic nuclear weapons. Two of his proteges Richard Perle and Paul Wolfowitz thought he was genius.
The neocons have been itching to try out his theories for decades. If it came down to losing a few thousand U.S. troops that were pinned down in the desert--- the neocons would use nukes with glee.
Someone is going to stop these madmen. They just have to.
If it kicks off then I'm taking a month off work, laying in the popcorn and beers and with my generator on standby, watching the burning carriers and cross cowboys on my big telly.
Yay for the 21st centruy !
CBS News had this the other evening:
Israel Poised To Strike Iran
http://www.cbsnews.com/sections/i_video/main500251.shtml?id=4206561n
You sort of have to wonder if Mossad isn't working with OPEC or Little Oil to drive the price of oil ever higher?
Oh, and those Iranian tankers marking time in the vicinity of Kharg Island, IMO, will be the mechanism used to plug the Straits of Hormuz.
Unless they first "accidentally" get hit by missiles fired from a US aircraft carrier defending itself against "unprovoked" Iranian military aggression.
Actually, all they need do is move down the navigational lanes as they would normally and halt. The move could be done in only a few hours, and I'm very certain the Iranians have enough intel assets to provide them with more than enough warning.
Another point I made at another site. Olmert and his government are on the ropes; Olmert himself is almost in jail for corruption. So, much of the "hawk talk" represents wrangling over the composition of the next government. Also, with jet fuel at $4/gal, the recent Israeli "rehearsal" cost its treasury a rather large sum, an item likely to be used by Olmert's domestic foes. On the filpside, Olmert's government is engaged in talks with Syria and Hamas that were entered into to placate public opinion. Other factors are also in play: Israel's economy is being hurt by high oil/energy prices and an effective boycott of its products in Europe, and pocketbook issues are just as important politically there as elsewhere. So riddled with contradictions is Olmert and his actions, I wouldn't be surprised for Olmert's government to fall before the Iraqi Provincial election scheduled for early October. In other words, and as usual, the whole story isn't being provided by the Propaganda System.
Olmert and Berlusconi have the same approach. They both view public office as a way to get rich and to keep out of jail.
IMHO all this talk about attacking Iran is BS - Olmert is trying to keep the public from looking too closely at his finances.
Might be B.S. for Olmert but it ain't for Cheney. I won't belabor the point because it has been made by others. Mearsheimer and Walt are dead wrong. Israel is not an independent actor.
They are a useful pawn that Cheney/Wurmser/Perle are trying to push into starting their war. But I think that the Israelis are a bit smarter than that- at least I hope.
Wurmser and Pearle are as much Israeli citizens as US citizens. How do you know they actually have any loyalty to any nation at all? The neo-cons' brilliant idea was to create a personal reich by subverting several different governments at the same time via a network of political parties, foundations, media outlets, etc, all pushing the same ideology. They got ahold of Israel, financed Tony Blair's rise to power, then stole the US election. Their agents got Italy and Spain for a while, and got France recently. All full of high-rolling think-tank buccaneers who go to the same conferences and foundations.
What struck me is that Israel, the US and UK all have had tech bubbles and real estate bubbles. Israeli defense software firms began to rake in big export cash maybe 10 years ago, and the Israeli settlements were in the process of becoming US-style suburban subdivisions. When America's tech bubble collapsed, Greenspan (a neocon at heart?) violated his responsibilities to shift the money to real estate. Britain followed the US into the Forever War, lucrative for its own defense contractors like ultra-corrupt British Aerospace, and now is trapped by a real estate bubble worse than America's. Is this a coincidence, or a model?
The entire world is now infected with bad US and British mortgage debt, making foreign capitalists afraid of standing up to neocon rule and collapsing the whole house of cards. As for Israel, they didn't run out of bad mortgages to make, but their fortress suburbs are thirsty for water and oil that they don't own.
Super 390
You obviously are knowledgeable about this stuff. Ante up on sources. I want all of them.
Thanx
Former head of mossad.
Anybody else have alarm bells going off inside his/her head? :)
A really reliable source, yup.
Doesn't have an axe to grind, no - of course not.
Why do people read this stuff and let themselves be lead like lambs to the slaughter?
The mind boggles.
Many economists are saying, fwiw, that if Israel or US attacks Iran, then oil will go to $300-$400 and US will crash & burn in a financial crash of gargantuan proportions.
We shall see, but Seymor Hers is at least thinking that the propaganda is winning:
The Bush Administration steps up its secret moves against Iran
Re: Home heating oil customers in limbo
Residential fuel oil in some parts of Ontario now sells for $1.50 per litre ($5.68/gallon). If someone lets their tank run dry (and for those not on automatic delivery, that will become more commonplace if customers either can't afford to pay for an oil delivery or have delayed their purchase because they've been led to believe we're in the midst of a speculative bubble and that prices will fall later this summer), the cost to re-fill could easily top $1,500.00.
I'm fortunate that my oil-fired boiler is a newer, high-efficiency model and that last year I used just 702 litres (185 gallons). In May, I installed a small, 1.5 kW electric water heater to pre-heat the water feed my indirect hot water tank and, with that, I expect my fuel oil consumption to fall to 400 litres or less; granted, a 300 litre reduction doesn't sound like a whole lot, but at current prices my net savings are $20.00 to $25.00 a month which, in turn, results in a 5 month payback.
By comparison, many of my neighbours use between 5,000 and 7,000 litres a year (my own home had previously used 5,700 litres), which means they could be looking at home heating bills this year in excess of $9,000.00 or $10,000.00.
Cheers,
Paul
Wow-$10000 has to be some sort of record for an average sized house-IYO what is the market value of one of these homes? By the way, your posts are always a breath of fresh air with some defeatism rampant.
At $10000 a year I would guess that many won't be able to afford to heat their homes.
Is it realistically feasable for families to partition an insulate a core section of their house as winter quarters? (I assume that pipes freezing might require some solution - isolate and drain?).
There are some problems with that, but a lot of people are doing it already. (For example, empty nesters who close off the top floor of the house during the winter, now that the kids are gone.)
And that was common practice in the old days. In winter, the whole family would sleep in one room downstairs. Or the kids would sleep upstairs, but it would be unheated.
I tripled my attic insulation, air sealed and added foundation insulation for $2,800, this alone cut my heating bill by 30%. Upgrade the building envelope first, then consider upgrading HVAC equipment with an eye on what might be the cheapest fuel down the road.
Check out the comments in the thread on the article by Gail the Actuary:
http://www.theoildrum.com/node/4172
This issue was extensively discussed there, both for part and full insulation.
Bottom line, it is easy and pretty cheap, although you may loose some convenience if you have restricted money so that only part of the house can be done.
Watch the pipework and make sure that any areas which aren't going to be kept at a reasonable temperature are drained and cut out of the circuit.
Hi Brian,
Thanks kindly. I live in an older area that is exposed to strong winds off the Atlantic, so I expect our heating demands are somewhat higher than most; my home, at 2,500 sq. ft., is also pretty much the runt of the block. Two of my immediate neighbours live in Andrew Cobb homes (http://en.wikipedia.org/wiki/Andrew_R._Cobb_(Architect)) built in the late '30s/early '40s. Earlier this year, one of them replaced the original steam boiler; I won't even guess the operating efficiency of that 250,000 BTU/hr brute but, presumably, their new system will cut their fuel oil consumption by 25 per cent or more. In addition to the home's space heating demands, a typical family of four that consumes an average of 240 litres of DHW per day would use another 800 to 1,100 litres of heating oil for these purposes -- $1,000 to $1,400.00 a year at current prices.
Cheers,
Paul
Hey Paul,
When are you going to put in some wind generation to take advantage of those "strong winds"?
I have yet to thank you for your contributions. Thanks!!!!!
Thanks, karlof1. I'm picturing my neighbours gathering with their lit torches, shouting for my head! :-)
Over the past several years, I've been substituting electricity for oil (space heating and DHW) and to a lesser extent propane (cooking). However, my goal has been to keep within a 10,000 kWh/year budget and with the heat pump and, more recently, the addition of the electric hob and water heater that's becoming a lot more challenging. I've unplugged satellite receivers, television sets and other electronic equipment that are seldom used and drastically reduced the run time of the dehumidifier (next to the heat pump, our second largest load). The next step is to move our current ductless heat pump downstairs and replace it with an ultra high efficiency Fujitsu; this would trim our remaining fuel oil demand by another couple hundred litres and, at the same time, reduce our electricity use by about 10 per cent (a Fujitsu 12RLQ is 1.5 times more energy efficient than our Friedrich).
I do pay an extra $15.00 a month for wind power (3 blocks per month @ 125 kWh ea.) which covers nearly half our household needs, and at some point I'd like to bump that up to 6 blocks per month but, for now, my focus is on demand destruction.
Cheers,
Paul
You could get a heat pump water heater add on for the hot water heater. I will basically act like a dehumidifier while pushing the heat into the hot water.
Hi xironman,
I've been keeping an eye on this one:
http://www.genewscenter.com/Content/detail.asp?ReleaseID=3348&NewsAreaID...
We use no more than 30 or 40 litres of hot water a day (10 gallons), so emotion/ego would drive this purchase, not economics, but, hey, I'm sold!
Cheers,
Paul
Re the $10000, the relative silence on home heating costs in the MSM is interesting (yes I saw today's article). To spend $10000 on gasoline you would have to drive 50000 miles per annum at 20 mpg and $4.00 gasoline.
Hello Paul,
We did the energy retrofit for our house several years ago, it made financial sense then with natural gas at less than $10 per million Btu's. Now with the prospect of 15 or $20 gas this winter our return on investment is over 15%, now if I would have only bought wheat futures like I talked about last July.
Hi btu,
Congratulations; the money you spent upgrading your home will save you a significant amount on your future heating costs, increase your personal comfort and energy security, and no doubt enhance the resale value of your property.
I have good friends that own a beautiful Victorian home in Wilkes-Barre, PA. They use about 3,300 CCF per year, so I expect their natural gas costs this winter will exceed $6,000.00. For several years now I've been gently coaxing them to insulate and air seal and to replace their old boiler, but the message never hit home, that is, until now. When we last spoke I get the sense they've become far more receptive to the idea.
Cheers,
Paul
My house here in France used oil for heating and hot water. I stopped using it as soon as I realised just how much fuel it was consuming. I now use the oil from the tank to run my micro-tractor.
Hot water is now provided via a 1.2kw water heater (15 litres) and heating via a wood stove with warm air distribution system using a 70 watt fan. I'm currently looking at installing a wood fired boiler to replace the old oil system, although I doubt we will use it all the time as our existing arrangements work fine.
Originally, we still used the oil water heater when we wanted to take a shower, but when it broke down, we found we could still shower using the 15 litre water heater. It saves money on the water bill too, with water here costing 3€ per cubic metre. Rainwater collection, for all external water requirements, and dual flush toilets have also reduced our water bill quite a bit too.
I agree that there is lots of simple things that can be done to reduce energy usage and costs. We've reduced our heating costs massively (probably in the region of 70%) and we haven't even insulated the house yet. There's much more to be done, for example I've bought and old radiator for 5€ which I intend to use as a solar pre-heater for the hot water, possibly using parts from the now defunct oil heater.
All money saved then goes into infrastructure and equipment for the micro-farm.
Hi Burgundy,
Looking at my last statement, between September 25th and March 31st of this year, our two-person household used a total of 14 cubic metres of water, or an average of 74 litres per day; water and sewer charges total $1.56 per m3, so our water costs are about one-quarter of your own. We have low-flow shower heads, low-flush toilets (6 litres/flush), a BOSCH dishwasher and front load washer. Both of us are water frugal by nature, so the first five litres of water we draw when we purge the shower line of cold water is collected in a watering can for other uses.
In terms of DHW, our 67-litre, 1.5 kW electric tank is more than adequate for our needs -- a single, 5 minute shower @ 2.7 lpm is 13.3 litres, some of which would be cold water tempered with hot. I do wash laundry in either hot (whites) or warm (colours), in large part because our mid-winter supply temperatures are near freezing (some days you can see ice crystals).
Cheers,
Paul
Your experience shows exactly what people will do: they will stop using 5000 liters per year, and cut down to under 1000 liters. They will find that life doesn't really change much as a result -- that the actual benefit from those extra 4000 liters per year was almost nil.
In general, I think oil heat is a bad system, as it tends to be centralized. It would be better to rig up a woodstove with an oil dripper to heat one room. Then, you don't have all those pipes which need to be kept from freezing. As for heating water, the solar solutions are good, but in terms of quick solutions, and electric water heater is not a bad way to go. I have a 19-gallon 1.5kw heater. It is enough for two people, with quick showers, and doesn't use too much energy.
Last winter, I used about $200 per month in electricity for heat. This is all-electric heating, in upstate New York, where it gets well below 0 degrees F at times. At $0.15/kwh, that's about 1,300 kwh/month. Still quite a lot, if you ask me. I'm aiming to cut that in half for next winter, to 650 kwh/m or $100 (assuming prices don't rise, although they will). Here's the strategy.
1) I already have a "winter apartment" -- kitchen, bathroom and bedroom, separately insulated. Increase the insulation above this area from R-40 to R-70. Cost: $350. This area will be heated by: a) a 1500W plug-in heater, permanently set at 42F to avoid pipe problems, and b) an 800W radiant heater, used as needed.
2) Make "kotatsu desk" to reduce heating in office from 400W average to 175W. Cost: $40
3) The "winter apartment" has large windows (and a sliding glass door) to the unheated parts of the loft apartment. Some of these windows will be "disappeared" by filling them with 2" foam/foil board. (R-10 plus reflective foil cover; $35 per 4x8 sheet) These will be easily removable in warmer months.
4) Some of the windows to the outside will also be filled with 2" foam/foil board, removed in warm months. Cost of all foam board: $105 for three sheets.
5) Remaining windows will have insulated curtains. Cost: $100
6) The "winter apartment" will be painted with reflective thermal paint. Cost: $125 for five gallons.
Total estimated cost: $700
Some really great ideas, econguy. Years ago, I use to clip a 45-watt PAR38 halogen lamp to the privacy panel of my desk to use as a foot warmer -- regardless of the indoor temperature, if my feet are warm, I'm warm. A safer and more practical solution is an electric heating pad placed on top of a folded bath towel. Those 30 or so watts might allow you to lower your home's main thermostat by an extra one or two degrees.
Cheers,
Paul
A "kotatsu" is a Japanese invention dating from centuries ago. They would take a brazier of coals, put it under a low table, put a blanket over the table which hung to the floor, and then put a board on top which served as the table top. You could put your legs under the blanket and keep warm in winter. Later, the brazier of coals was replaced by a simple radiant electric heater, typically of 100-300 watts.
http://www.jlifeinternational.com/furnishings/kotatsu/kt011.html
The "kotatsu desk" is much the same idea. Last winter, I used a simple 400W radiant heater under the desk, much like your 45W light, but with no other heating. (Some mornings it is well below 20F in the office when I get there. The 9'x15' window and 12' ceiling doesn't keep much heat in.) This winter, I'll cover the underside of the desk with foam/foil insulation, and put a blanket/board on top like a kotatsu. I expect this will allow me to cut my heating needs to 175 watts, which will take the form of a clip-on utility light from Home Depot with a 175W radiant bulb.
Assuming 10 hours per day of use and $0.15/kwh, the monthly cost of this heating system is $8.
I've just built an office in the garden in the back 1/3rd of my garage. I had it insulated very well and according to heat load calcs should run off body and PC heat only with a 200w additional load at -5c.
I have put the heater under the window with the desk running over it for the same reason; interesting to see this is a formal idea in other parts of the world.
Thing is - how do you avoid condensation on electronics ? I can't imagine going to 20F will be good for them ?
Hi econguy,
At 20F (or below), a kotatsu desk makes a lot of sense. A couple comments to pass along, FWIW. When I used the 45-watt halogen to warm my feet I found, not surprisingly, the top sides were warm but my souls were cold, especially when they came in contact with the floor. The electric heating pad was a more comfortable alternative and far safer too.
Which brings me to my next point. I stopped using the halogen lamp out of fear I'd end up burning down the house and because it was difficult to regulate the heat. With several combustible materials in close proximity to a 175-watt radiant lamp, the potential risk of fire strikes me as just too great. I would strongly encourage you to consider another option such as this: http://www.grainger.com/Grainger/items/1VNX3 A thermostatic control would make things more comfortable and you could plug it into a timer to come on a half hour before you arrive each morning and pre-heat your desk. Use a 45-watt halogen in a swing arm lamp to position the light (and warmth) over the keyboard and mouse and/or desktop workspace (I don't like resting my arms on a cold surface).
Cheers,
Paul
I spend forty dollars a month on energy for the ole homestead.
I can't imagine why anyone else would spend more than that other than just plain ole stubborn consumerist brainwashing.
My high tech consists of the following. I occupy 400 sq feet. I only turn on the water heater to heat the water for the shower. After the shower, I wash the dishes for the day.
I have not used a refrigerator for four years, preferring to eat fresh, canned, or dried food.
I have not used the central heating unit for nine years. I use a single electric heater. The avg. temp in my house in midwinter where temperatures can reach negative five is 58 degrees.
I use one light, fluorescent, at a time. ALWAYS. I do not watch television. I do use a computer.
I have an extremely efficient window air-conditioner which I run at 80 degrees. I could do without this, obviously.
I have never been happier. I used to own a home with two separate central air and heating units, a four car garage, an apartment in the basement, yada, yada, yada. Three hundred dollar energy bills in the late eighties and early nineties. Shudder to think how much of the patrimony I'd be throwing away now had I remained in the egoship.
Reflective thermal paint is a great retrofit for any existing structure. It looks like normal paint but contains glass spheres which reflect up to 90% of radiant heat. In fact, you can buy just the glass spheres and mix it with normal paint if you like. In practice, applying the paint has led to roughly 30% reductions in heating fuel usage compared to normal paint. At $125 for five gallons, it's a no-brainer.
http://www.hytechsales.com/
I am highly doubtful of this product.
Even the best insulators (such as solid aerogel) cannot have much of an R-value with paint thickness. And an additive will have much less of an impact.
As for reflective, aluminum foil is cheaper and more effective.
Best Hopes for avoiding snake oil,
Alan
It is based on reflection of radiant heat, not conduction (or anti-conduction) of heat. Different principle. R-values do not apply in the normal sense, although you can have an approximate "R-equivalent." The R-equivalent of 1/8" foam/foil insulation is about R-10. In other words, in a practical application, the amount of energy saved by using an "R-10 equivalent" reflective thermal surface is about the same as adding R-10 worth of regular insulation, which is about 2.5" of fiberglass batting.
Aluminum foil is cheaper and more reflective, but only a little more reflective, perhaps 99% compared to 90% for the paint -- within the infrared realm that is most important for heat reflection. The upside is, you have a normal-looking painted surface instead of the "I'm a baked potato" decor. More durable too.
I prefer the "Playboy" look; mirrors everywhere ;-P
Great place to sip the sarconol with friends.
Alan
Hi econguy,
Just to echo Alan's comments, I used a thermal paint in my Toronto home made by Para Paints and, to be honest, I found no difference in comfort nor any verifiable savings in my heating and a/c costs. In addition, it was difficult to apply ("caulky" is how I would describe it) and, moreover, you couldn't properly clean it, so if someone touched the walls their finger prints couldn't be removed (my home ended up looking like a CSI set). I was very disappointed.
Cheers,
Paul
What are the prospects for micro CHP? I've only experienced one northern winter and that was when I was 7, so my experince is about nil but, it seems to me that just burning fuel for heat seems a terrible waste. When burning fuel in engines, a significant amount of the energy from the fuel is still in the form of heat. Everything I've read says CHP is far more efficient than heat or power alone and if there was ever a time when there's a demand for something like this, it would be now.
Cheap energy meant it was never necessary to have the kind of efficiencies that CHP offers but PO is pointing us to a far different future. How difficult will it be to develop engines (piston or turbine) that could burn heating oil or NG and then use the waste heat for home heating? I'm thinking of something that could be a drop in replacement for existing furnaces/boilers. Even if it were impractical for individual detached houses, there should be some feasibility for apartment blocks and townhouses.
It just strikes me that the vast majority of modern kitchen and home cooling/heating appliances have been designed with a cheap energy mindset. What would these appliances look like if designed for a different paradigm (very expensive fuel)?
Alan from the islands
Starting Tuesday, you'll pay more to boost transit in five counties
Nice! Any idea when they are going to start work on the Central Corridor line?
BobCousins, in case you're not following the Drumbeat from yesterday any longer, I was interested in hearing why you didn't like Zabel's 20% cutoff for a new energy source raising the population ceiling.
If you're still interested in continuing the conversation, please see:
http://www.theoildrum.com/node/4227#comment-370711
-André
http://www.cnbc.com/id/25269297
Credit-Card Debt Snaring More High-Income People
"In our culture, frugality is almost a dirty word,"
Not too long ago, even 3 decades after Veblen coined the term "Conspicuous Consumption" in The Theory of the Leisure Class, frugailty was considered a virtue, and in my family, it is still. The culture that still valued frugality helped the effort to win WW2. A lot of social engineering went into coopting that culture. I think of us Peaknics as pushing back against the Virtue of Consumption Culture forced on us by Madison Ave. I see frugality as a natural response to scarcity, and its practice a form of religious pragmatism.
Good post but "religious pragmatism" is an oxymoron.
Perhaps to you, but to those who were/are still frugal it is a tenet of their being. I suggest you have a good look at William James's Pragmatism to understand how it functioned within the realm of Puritan pragmatism/frugality and the nature of US social-psychology prior to its undoing after WW1. I would also say that religious pragmatism functions in many non-Western cultures, which is why they found the connections made by the Missionaries between Capitalism and Christianity to be oxymoronic, and why they were able in most cases to embrace the latter while rejecting the former.
If there ever was evidence that the USA is NOT a Christian nation, one need only look at the tenets of Christianity, which promotes social cooperativeness sans competition, sharing, caring and the promotion of the whole of the congregation, not just a few members.
Frugality is a dirty word because Madison Ave. has succeeded in peddling the fear of being considered "cheap". Our images of success, power and happiness are all personified by the crass consumption of resources.
Heinberg has said he believes the only way our culture can prevent a peak oil die off is if the full power of advertising and the MSM are put in reverse to spread the message of powerdown.
Congressperson Bartlett has also touched on this issue - that we need to redefine success in terms of one's social and spiritual capital, rather than by how much one consumes. When a Conservative like him is sounding this message, it gives me hope that people may eventually grasp peak oil as being larger than a democrat or republican issue; moreover, larger than the Capitalist/Communist dualism that the industrial fossil fuel era ushered in.
Non-stop rain takes its toll in flood-hit south China
http://www.abs-cbnnews.com/storypage.aspx?StoryId=123232
China's agriculture and thus food production most have been severely affected this year, undoubtedly driving up prices and food imports too. Add to that the floods in the US, drought in Australia and all the other agricultural impacts seen around the world. Are we heading for a food shock along with the oil shock?
I've been visiting quite a few organic farms in my area (of France) recently which has been extremely interesting. But, two of the vegetable farms are talking about giving up after about 20 years due to the weather related problems they've been having. Another one, whilst not saying anything directly, is obviously struggling and may have to reduced the surface area farmed to maintain control over production.
Whereas the big events get the headlines, I'm beginning to suspect that an even bigger albeit silent problem may be slowly creeping up upon an unsuspecting world. Namely yield depletion, where yield starts falling slowly at first and accelerates over time, similar to after peak oil production.
BTW Bob Shaw has been doing a marvellous job highlighting some of the key problems facing agriculture.
The European birthrate item is absolutely good news. We HAVE to reduce our footprint on the planet if anything other than humans and insects is to live at all. There are positives! People in Japan are not starving in spite of the low birthrate.
The enlargement of the natural world is good news. Interweaving human communities and the natural world sounds like a fine idea to me. Let our demands on the earth fall. Let other creatures live. It will be a better world, and people will enjoy it more.
More prosaically, it will mean lessened demands on expensive school systems, transport, housing. My baby boom generation will have to work a few years longer - but most of them are planning to do that anyway.
I can imagine a time when the natural world is larger than it is now. I look forward to it!
You say it. Quality of life is increasing with less people.
But unfortunately, the EU agreed recently to immigrate as much as 20 Mio. until 2015 and more than 50 Mio. until 2040.
I have the links, if you are interested.
http://en.wikipedia.org/wiki/Population_pyramid
I link this due to the good NYT article on European slowing population up top and previosu disucssion here of this topic related to origins of WWI and WWII and current ongoing and expected wars due to population pressures among many other factors. THE NYT article up top cites USA maintaining much higher population growth than previously projected in 1984. Considering the resource restrictions oncoming this could be a disadvantage and a reason for military adventurism. Europe/Japan is incapable of long term war as youth population is in sharp decline. WE often cite here at TOD the facotr that oil supplies played in winning WWII for example and nowadadys hitech weaponry are very important. After oil diminishes we are back to brute force of course, which means baby boom beats all other arguments. It is of ocurse the time between which is most dangerous, when the hitech weaponry are still working and the various powers are willing to use them regardless to make sure they reamin (USA) or become (China/India) the new superpower.
At any rate the social mood is formed by the pressure from "the street". Proportionally lots of young people without jobs, etc. put lots of pressure on governments to find an outlet for their energies(external wars) to keep the peace at home(avoid revolution). America is not an extereme case but has a fairly young population and overuses resources to a very high extent. Europe is a moderate resource user with an older population. Poorer countries with young populations could be more esaily satisfied due to moderate resource use. However as we see in 3rd world recently the whole situation is getting out of control with blackouts, foiod riots, etc. This could be blame don governem,mets or on the idustrial countries who overuse, driving up prices. When the blackouts and food shortages hit USA/Europe/Japan only USA is young and aggressive enough to overreact due to public mood and overuse of resources. They have the will(youth anger) and the way (military prowess), so to speak. 3rd world and Europe would have only one or the other.
The only real challenger is China.
Africa will likely be a giant Zimbabwe, South America is way back in industrialisation as is India, in spite of recent progress.
For my money although China still has a fairly young population, this has all happened 5 years too early for it as it is still not developed enough - its blue water navy for instance is in no position to challenge for control of the Gulf.
This leaves out the possibility of alliances though, the traditional answer to relative weakness.
A Chinese/Russian alliance would be formidable.
Speaking as an American, don't underestimate China's industrial ability. It only took the US about three years after 12/7/41 to put that machine into play. I seriously doubt we have the INDUSTRIAL clout to compete, especially if China hooks up with Russian energy and resources via the SCO or a more direct alliance.
I saw these side by side photos of Shanghai once upon a time(I wish I had saved them). One was, IIRC, 1997 and the other 2001. In one was the city in the background with a huge many square kilometer meadow in the foreground. In the second the meadow was gone, filled with just more Shanghai. The caption said the additional development was equivalent to the city of Chicago. The same happened at Beijing, Chongkin, Xinhau, and a few other places. It's inconceivable for us to imagine a nation that can build, and can afford to build, something like a Chicago or two a year while still producing like half the world's exported finished manufactured goods. This has continued for the last few years. There's a reason China uses as much concrete, steel, copper, etc. as the whole rest of the world combined.
Remember, in war it's not about "economic power", real or imagined. It's about raw industrial might provided with adequate natural resources. I believe the US would fare against China about as well as Japan fared against the US in all out conventional war. Nuclear is another matter...
They certainly have determination...and organization. Did anyone catch the brief video which showed how they finally were able to get those lakes that had formed after the earthquake to drain away? They used strategically located explosions using some kind of hand operated missile system (I think). I remember thinking to myself at the time that it was really an amazing feat.
For my money although China still has a fairly young population...
Check the UN's population projections. China's "one child" policies have drastically reduced the number of children. By 2040 or thereabouts, China is forecast to be a significantly "older" country than the US. I took a graduate economics class a couple years back that included several Chinese students. At one point the prof asked, "How many here are only children of only children?" About half the Chinese students raised their hands, and no one else. How many people do you know that have no siblings, no cousins, and no aunts or uncles?
In 2010 as opposed to 2040 China will have a large number of men of military age, and what's more due to selective abortions a lot of them will have little chance of finding a partner.
Frustrated young men in plentiful supply are a pretty good resource to fight a war with.
By 2020 or so the proportion of suitable age starts to drop rapidly.
In a similar fashion it was apparent in 1914 that Germany was pretty well coming into 'peak young men'
The inflection point for European growth was at around that date - it looks as though the inflection point for world population will be at around 2015.
Actually, China's poplulation is projected to begin aging rapidly in the next 20-30 years. Their forced birthrate reduction (to 1.7, IIRC) is beginning to have some serious demographic effects.
The slowing (native) population seems to be the top priority of EU politicians. They are afraid, that a shrinking population doesn't create enough (economic) growth. Does not create tax income growth for the countries. They are in desperate mood, since they know, that a diminishing tax revenue means, they cannot grow in spending state money. It so easy: If the politicians must curb spending, they won't be reelected. Everything (survival) is based on growth.
The EU is going to be Islamic within the next 30 years. First is France, which should have an islmamic majority around 2030, then Switzerland, Sweden, UK and Germany.
The islamic fifth column in Europe has grown, in the main, because of the Barcelona Agreement; immigration for oil, an arrangement between the European political class and Saudi Arabia made decades ago.
The Agreement is also designed to divide the native people, brainwashed with multiculturalism and enforced political correctness, making it easier to govern across borders.
This plan will backfire as it has assumed an abundance of cheap energy. The disparate groups will fight each other along old grudges and the native people. Race war, or perhaps accurately, culture war.
islam will attempt to take advantage of the confusion, and here is where my crystal ball fails me...
I will not submit.
America's WASP bigots used to scream about the Popish plots of the filthy Irish dragging the Republic into hell. Nothing that big labor and progressive liberalism didn't cure, after 80 years of dreadful laissez-faire poverty. They also screamed about the conspiracies of the Jews, the Italians and the Chinese.
Next?
You forgot the Japanese, Slavs, and those labeled "Hispanic."
I just came back from a European vacation, which included visiting London, Sweden, Sardinia (Island that is part of Italy), and Corsica (Island that is part of France).
I observed the following retail gasoline/petrol prices:
London: £1.21/L = US$9.13/USG
Sweden: SEK13.84/L = US$8.76/USG
Italy: €1.55/L = US$9.24/USG
France: €1.54/L = US$9.17/USG
These prices are just averages of what I saw, but didn't seem to vary much from one location to another nor from one day to the next.
Not surprisingly, the average car on European roads looks a lot lighter than the average America vehicle. For some reason, the swedes seem to drive heavier vehicles (Volvos and Saabs) than the french, italians, or brits who are more likely to own Fiats, Renaults, etc.
What was surprising was the extent of motorized recreation -- RVs, Jet boats, ATVs, and yachts where seen in large numbers. The RVs where generally smaller than the american versions, and the jet boats and ATVs seemed to be mostly rental. There were quite a few 4x4s on Corsica which is mountainous with many rough roads.
What I don't understand is how Europeans can afford the high prices. How can americans be suffering when everything in Europe seems to cost double, and people overthere seem perfectly capable of handling these high prices? I doubt the standard of living is higher in western Europe than in the US. What am I missing?
I think one reason is the strength of the Euro. Another reason is that labor is stronger in Europe, and they have not seen the consolidation of wealth in the richest part of the population, at least not to the extent that's happened in the US. Europe is also less dependent on personal vehicles than the US is, both because things are closer together and because there are more alternatives (I once heard a Brit say, "Americans think 100 years is a long time; the English think 100 miles is a long distance"). Finally, I would say that America is more infected by consumerism than Europe is. How many flat screen TVs do those people who are "hurting" own, compared to how many are owned by the Europeans you're talking about.
All that having been said, Europeans are definitely hurting, or there wouldn't be so many protests, work stoppages, and such.
Our taxation system has benefited the very large local car industry in Sweden but that do not explain why Volvo and Saab choosed to make large wehicles.
It could simple be effect of us being a lot richer then the French, Italians and Brits in the post WW2 boom before toying too much with socialism and being able to afford large cars. Large imported US cars were also popular in that era. The early focus on wehicle security has probably also contributed to wehicle size.
When we had harder times before todays boom the cars did not shrink overall but were kept longer. The Volvo 240, 740 etc were also quite easy to repair and spare parts are cheap. The adaption to smaller size were slow due to a large part of the new car sales are to companies who can buy them for their emplyees use with low taxed money. A large car were a loop hole in our very heavy taxation tailored to keep the large car industry humming.
Why Saab and Volvo chose to make big cars, I don't know. We are longer than most Europeans, for instance, but I think the most important answer to why Saabs and Volvos are more popular in Sweden than in other contries is because they are made (mostly) in Sweden. In Germany VW and Opel are popular, in Italy Fiat, in France Peugeut, Renault and Citroen.. and so on.
The Peugeot 308 diesel gets 62.77mpg combined. Being one of the most fuel efficient vehicles in the world, I suspect it is some sort of benchmark in Europe, for how fuel efficient a car should be. It is not considered all that spectacular and unlike the Prius, does not carry a significant price premium. It is in many ways a very ordinary, affordable European small car.These small, fuel efficient cars probably outnumber their larger, less fuel efficient counterparts by a fairly large margin.
In many European cities, a car is far less of a status symbol than in the US. I remember reading om www.autobloggreen.com about anti-SUV protests in a couple of European cities and also, that SUVs in London are disparagingly called "Chelsea Tractors". For New Yorkers, think "Manhattan Tractor" and how out of place a farm tractor would be in modern day Manhattan Island, the implication being that only an idiot would drive a farm tractor (SUV) in the city. The whole car culture is apparently, different in Europe. In how many US cities do you think, you would see SUV owners having rotten eggs and spoiled tomatoes hurled at them .
The United States has the lowest average fuel economy among first world nations; the European Union and Japan have fuel economy standards about twice as high as the United States. I suspect you would find part of the answer there, as it could well be that Europeans travel more than twice the same distance on a gallon of fuel than Americans on average.
I remember on a visit to London last year seeing several instances of an expensive SUV and an inexpensive commuter car parked outside the same expensive house. I suspect the commuter is used to avoid London's congestion charge but the overall net result would be a reduction in fuel consumption. I also suspect that "average fuel economy" describes the mix of vehicles on the road and not the total miles travelled vs the totall amount of fuel consumed.
Take the case of the London family owning a Range Rover and a VW Polo. Their average fuel economy would be the figure for the SUV plus the figure for the small car divided by two. The result of dividing the total miles traveled by the total fuel used would depend on how much of the total distance is covered by each car. So, if the car with the higher efficiency covers a greater distance than say, a less efficient weekend driver, that would add to the effect of having better average fuel economy.
Then there is the whole issue of rail and mass transit being mech better developed in most of Europe.
Just a couple of thoughts on what you might be missing.
Alan from the islands
http://www.ajc.com/opinion/content/printedition/2008/06/29/lettsed.html
Voice of the American consumer.
I followed the evidence thread posed by the item on Mass. utility cutoffs to find the following table within this small pdf.
3/31/08 3/31/07 Difference
Arrearages $4,958,082,858 $4,318,115,503 $639,967,355 14.8%
Households 15,607,913 14,259,636 1,348,277 9.5%
% of Total Households 14.8% 13.5% 1.3% N/A
Average $318 $303 $15 4.9%
The above figures are for the whole USA, and are probably understated, and as the table notes, they aren't current. If we assume 15% of today's households are about to be shut-off and we assume a household population of 300 Million, that gives is 45 Million people--an amount eqivalent to the "Third of the Nation, Ill-clothed, Ill-housed, and Ill-fed," from FDR's speech of the same title, that are about to lose the amenities of modern living--electricity, and the refrigeration and cooking appliances it powers; and hot water.
Some Super-Power, huh. How many will be living in the dark come election day? 25% or 75 Million isn't too far-fetched, IMO. If ever there was a proxy figure showing the true economic health of the USA, I think it's the above table.
EDIT--When I go to edit, the table appears as a table. What causes its collapse upon posting?
You cannot use the "table" tags that way. You need to know how to do tables in HTML to use the table tags. (tr, td, etc.)
What you probably want is the "pre" tag. That will monospace text and keep the formatting you see in edit mode.
Thanks, I will practice with it. I also need to know how to insert a photo instead of just linking to it. But before even using the table tags, just putting the table together in a text format, it would still collapse, the additional spaces between data becoming just one. Oh well, time to learn a new trick.
Start here
http://tutorials.photobucket.com/tutorial_151.html
FTFY
Thanks to you both.
Since I went through a time in my youth with my power shut off, I have some empathy and compassion for these millions, something apparantly not shared judging by the lack of comments.
Yeah, they're just demand destruction, or Iraqis in Falluja; they brought it on themselves, so they deserved what they got. Or it can be seen as a US Military recruiting drive. LBJ started the War on Poverty; Reagan willingly surrendered.
Mish has a good post up on cheap solar power.
Promising Solar Power Technologies
http://globaleconomicanalysis.blogspot.com/2008/06/promising-solar-power...
While solar thermal is promising did you see the report that the Bush admin has frozen new construction of new solar thermal plants for 2 years while unspecified environmental risks are evaluated.
Talk about the government picking the winners. On one hand they want to drill everywhere without any environmental restrictions and on the other hand solar is frozen because there might be environmental problems they might find in a 2 year study!
Hello TODers,
As most know: I support Alan Drake's RR & TOD ideas 100%, and I really hope the nation gets busy towards this goal.
But what if your urban area's RR & TOD conversion pace starts drastically falling behind the rate that people are priced out of PHEVs, electric scooters, golf carts, and bicycles, not to mention their ICE vehicles being chicken coops?
Recall my earlier link where a scooter dealer had sold all his inventory and people now had to ante up $500 just to get on a waiting list-->I expect this supply problem to get much worse. So potentially, we could see large numbers of people in the outer suburban asteroid belts being stranded from their jobs and the vital resources moved by the rail logistics.
The waiting list for buses, standard-gauge heavy-railtrack, passenger railcars, trolley cars, and other conventional transport for Alan's ideas could be years away for your city, if they have not already placed their massive orders in this waiting-queue. I suspect my huge Asphalt Wonderland [the deluded Metro-Phx area] is not even on this list, and their current mass-transit system [still being built] will be woefully inadequate WTSHTF. :(
Thus, my minitrain posting series, available in the archives of TOD. Recall that carefully dis-assembling the steel from the top 35 floors of a 40-story skyscraper may provide 100 miles, or more, of light, narrow-gauge railtrack [that does not require remelting or reforming], but can be nearly instantly bolted down to concrete sidewalks, or down the asphalt street.
Alternatively, the next time you are in a big-box store: look up at the overhead, structural steel that supports the roof, plus the safety firepipe for the emergency sprinker system. Then imagine converting that into narrow-gauge railtrack and hastily, but well-built minitrains.
These former pieces of structural angle-iron, steel beams, and building piping should be plenty strong enough for supporting [for a fairly long time] the very lightweight 'Cambodian Bamboo Railway Train' adapted for our First World Cities:
http://www.youtube.com/watch?v=l4qttp6nDts
[the minitrain model I am suggesting starts about 2 minutes into this 7 minute video. Also notice the small sacks of some passengers--is that their year's supply of I-NPK?--Yikes!!!]
But if a city plans ahead further ahead [while still building out Alan's ideas]: they could have even more efficent and comfortable passenger and mini-freight minitrains, as ilustrated in the following links, in their asteroid-areas to keep people and freight moving:
http://www.monon.monon.org/sobendpixs4/03-26storyland-train1.jpg
http://www.monon.monon.org/sobendpixs4/03-26storyland-train2.jpg
I have detailed in earlier postings my thinking on how to quickly electrify these trains by tapping the powerlines from the overhead streetlamps directly overhead. Then, as the standard gauge RR & TOD expands: the minitrain track can be quickly moved further out and/or recycled/remelted for more equipment of Alan's ideas.
Obviously, we would prefer the faster speed, greater comfort, longer durablity, and more efficient factory-built minitrains [with regenerative-braking] and track over the last-gasp Bamboo versions, but who knows how this will play out as we go postPeak?
I have asked before if the engineers on TOD are working on the development of quickly converting ICE engines for these minitrains, but I got no replies [as far as I can tell]. I am not an engineer, but I will keep plowing ahead with my 'wild & crazy ideas' to help our future from being the worst.
Since thieves are now busy siphoning gastanks, when fuels become Unobtainium, I suspect that rechargeable-batteries will be their next target. You may ride your electric vehicle or batt-scooter to your local mass-trans or mini-tran depot, lock it up very well, to only come back to the battery pack missing. I was trying to think of a way to reduce this theft problem when the old lightbulb went on:
Picture the Bamboo train without an ICE engine [remember: now Unobtainium], but your fare would be to remove your battery from your personal ride, then hook it up in parallel with the other passengers to power the minitrain's electric motor.
Recall, from Alan's prior discussion and weblink, that an electric train is much more efficient than an ICE train, and a batt-electric minitrain is much more efficient per passenger mile than a single batt-electric vehicle. Additionally, if the roads are badly pot-holed and suffering sewage overflows nearly everywhere [see prior archive discussion]: then people will gladly use their batteries as the fare to power along the smooth railtrack.
The conductor could easily determine how far you get to ride the minitrain by quickly checking the battery charge with a voltmeter/chargemeter, or perhaps the parallel hookup system would signal somehow if the battery is fully discharged before you reach your destination.
This would prevent your battery from sucking juice from the other parallel batteries. The advantage of when you leave the train--you also take the battery with you: this reduces the weight and 'fuel-load' losses for the remaining passengers' battpacks, further enhancing their transport efficiency.
You then recharge your battery at work downtown, either from the remaining grid, or perhaps your employer has solar panels to accomplish this task for you as part of your compensation. Thus recharged: you now have the fare to commute back towards home, then pop the battery into your dinky electro-bike to complete the final, short trip home.
Hopefully, you can further recharge your battpack with a small windgen, micro-hydro, or small PV panel for when you next need to go to the downtown area for supplies or work. Imagine all the millions of batteries currently installed in our ICE vehicles: yanking them out for batt-scooters and electro-minitrains could do much to keep us moving, and hopefully the battery mfg. industry can provide a steady resupply as we continue to build out Alan's ideas. The vehicles' steel rims [cutoff or remove the tires] could be the quick source of minitrain wheels for rolling on the narrow gauge track and/or pipelines.
If things really get ugly fast, where even battpacks become Unobtainium: any narrow-gauge rail-track, that is already installed, will provide the first migration path for human-powered railbikes; my prior postings on SpiderWebRiding. This is still far better than Nuahtl Tlameme backpacking.
Okay, enough for now. I hope this is not so long that Leanan deletes this--my Greatest Fear! Thxs for any TODer replies that further elaborate or refute my thoughts.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Bob,
I don't like it from an economic POV. If you have a cluster of employers using a shared renewable resource, surely it would quickly evolve into them owning or collaborating with the minitrain operators to provide the juice and give preferential rides to their employees, if not these energy surpluses leading to the buffering of said surplus in monetary form? The adhoc system you describe might work on long distance lines, but those would surely be a whole other battery system?
Hello TODers,
I was just watching the 'Cambodian Bamboo Train' video again, then I started wondering:
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Is this country now so poor from ELM and rising I-NPK prices that possibly many, or most of these rudimentary trains are now just rotting away in the jungle weeds?
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Yikes!! :(
Oil has started the week up and is again approaching $142. Perhaps we will hit $150 by July 4th as predicted in early June by a Morgan Stanley analyst.
http://www.chicagotribune.com/business/chicago-oil-prices-150-july-jun06...
allthough it pis es me off to pay 1.45 ltr up here,more damage will be done if oil drops to 100 beans a barrel and or 1.00ltr for gas/diesel.lets call it the "boomerang affect"
my point is,i hope this is not a passing phase or we are in big trouble.
Hello GLT149,
Thxs for this info. Don't forget: as FF prices increase-->I-NPK and sulphur prices have to increase too.
The P & K rocks are free, nitrogen [N] is free too, but it is the huge energy inputs to mine, beneficiate with sulfuric acid, then globally distribute these multi-millions of tons around the planet that makes this industrial fertilizers so expensive. I suggest a huge O-NPK recycling upramp and composting everywhere to try and offset this I-NPK pricing trend.
Have you hugged your bag of NPK today?
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Not sure I get the expensive FF yields expensive silfur. IIRC sulfur was considered a waste product from refining of FF. Since we are using progressively dirtier FF -even if the volume of FF doesn't keep up, I would think the amount of sulfur would be increasing. Will the pending opening of new heavy-sour refineries reduce the sulfur crunch?
Hello Enemy of the State,
Thxs for responding. You may be right, or wrong--I don't really know, as I am not an expert, and the detailed sulfur projections cost BigBuck$$ from Pentasul and the other Mineral-Marketing outfits.
Most of the recent weblinks I have recently posted state: their experts say it is still going up, possibly for the next year, with a possible pricing plateau when new sulfur FF-extraction processes begin in China and the MiddleEast in sour natgas & sour crude fields.
The above paragraph was just for the raw product price. Then you have to add the fast-rising transport costs, which make it increasingly difficult to move this sulphur around. Picture the energy required to move a ton of sulfur from the Athabasca oil-sands to Morocco, then the finished phosphate and sulphate to far-inland Africa.
We all know how these mammoth FF-infrastructure projects have a tendency to be delayed due to equipment backlogs and/or expert worker shortages. Accidentally released Sulfur gas-clouds are quickly lethal--I hope they don't hire clowns to rush the process along.
In the meantime: 70 million people additional per year are clamoring for I-NPK to grow their food, and 60% of all sulfur currently goes for I-NPK [mostly for phosphate], and sulphate-based fertilizers, plus sulfur-based pesticides and herbicides.
Eventually [who knows how long?], even the sour gas & crude will start rapidly depleting out-->then the sky will be the limit on sulfur and the residual FF-energy to make I-NPK. Then almost 100% of sulfur will go to making activated phosphates to delay the 'Phosphorus Bottleneck' as long as possible. Just another reason for quickly ramping O-NPK, IMO.
Job specialization depends upon food surpluses; a brain surgeon can't operate if he is starving.
In short: I am hoping a TopTODer statistical wizard and/or an industry leader [possibly POT topdog: Bill Doyle] can add a lot more detail to my feeble texts.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Hello TODers,
http://www.theaustralian.news.com.au/story/0,25197,23941731-5005200,00.html
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BHP to plough $10bn into fertilisers [June 30, 2008]
..."The acreage available in terms of (farming) land per person is going down, the world's population is going up," Mr Calderon said.
...Mr Calderon said about six players controlled three-quarters of the world's production out of two basins, in Canada and Russia, and barriers to entry were high.
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That would be the Canpotex & Uralkali [K]Cartels, which, IMO, are vastly more powerful than OPEC is in FFs. Morocco and its [P]-allies, which form the P-irate Cartel are also, IMO, vastly more powerful than OPEC [recall earlier postings for details].
Sitting in the naturally occurring darkness with a full belly should be much preferred to starvation--we are evolved to enjoy a beautiful sunset.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Khurais to the rescue. I think I remember Joules Bourn writing about this field...can't seem to find that analysis though
http://www.msnbc.msn.com/id/25443913
This one?
http://www.theoildrum.com/node/3694
Khurais Me A River
Giant Saudi field is key to boosting oil output
http://news.yahoo.com/s/ap/saudi_giant_oil_field;_ylt=AhpA_LgROsfDkI1z8r...
The MSM is really getting in to it
Hello TODers,
This could rock the already teetering stock market downward, as if rising crude pricing isn't leveraging it down enough already:
http://www.marketwatch.com/news/story/floods-may-push-corn-stockpiles/st...
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Floods may push corn inventories to historical low
USDA to report acreage; analysts warn of $10 corn and possible supply crisis
...Shrinking acreage and falling yields could push 2009 year-end corn inventories to as low as 300 million bushels, down 80% from the previous year, Hackett projected. This will be the lowest inventory level the U.S. has seen since 1947.
..."If bad weather is seen in the July-August timeframe, then we would be talking about a corn supply crisis that would probably require some type of government intervention," said Hackett.
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The link goes on to say that this grain report is already obsolete--high probability of worse news ahead as more info is collected.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Humans are yeast. The question is, for what purpose?
Excisting do not require a purpose.
We ferment ideas and turn them into 8%-12% culture. (Some years are better vintages than others.)
Cmarch