DrumBeat: July 24, 2008

Don't take a flier on airlines: $130-a-barrel oil won't save the airlines — travelers must save themselves

Why the irrational aeronautic exuberance? Last week's unprecedented decline in the price of oil, which plummeted more than $16 and closed around $130 a barrel. With fuel now accounting for about 40 percent of the airlines' costs, sharply lower oil prices surely looked like good news to the markets.

But irrational exuberance is nothing if not irrational. The biggest airlines — American, United, Delta, Northwest, Continental and US Airways — can't make money at $130 a barrel. They can't make money at $100 a barrel, either. Nor can their smaller competitors. Even the double-digit cuts in passenger capacity and triple-digit aircraft retirements planned for the fall probably won't restore profitability unless oil drops to about $80.

...“Don't you dare rain on my parade,” an airline executive snapped at me Friday evening. “I want one weekend this summer when I can fantasize about not being in bankruptcy next year.”

Russia's military conducts test flights near North Pole

MOSCOW: Russia's navy conducted test flights near the North Pole on Thursday, boosting its military presence in an area believed to contain vast quantities of oil and natural gas.

Russia, China to hold energy talks amid oil demand

BEIJING - A top Russian official will visit China this weekend for high-level talks on energy policy, coming amid surging Chinese demand for oil.

Oil masks Canada's 'export recession'

OTTAWA -- Oil prices will continue falling and dip below $100 a barrel by the end of this year, unmasking an "export recession" in Canada that will result in anemic growth, a government export agency said on Thursday.

Japan: 3 major gas firms to hike monthly charges in Oct.

Major gas companies will raise their monthly charges in October, with Tokyo Gas Co. expected to hike its monthly fee for a typical household of four people by about 120 yen to about 5,680 yen, sources said Thursday.

Middle class: 'On the edge'

Adjusted for inflation, median household income dropped by $1,175 between 2000 and 2007, said Elizabeth Warren, professor at Harvard Law School, in written testimony before the Joint Economic Committee.

At the same time, the average family is spending $4,655 more on basic expenses, such as gas, housing, food and health insurance. Gas alone costs $2,195 more for a family making the same commute in May 2008 as it did eight years earlier.

Hunger is S. Florida's dirty little secret

The high price of food has sparked a secondary market where smashed canned goods or food that's about to expire are sold instead of donated to the food banks; dollar donations are shrinking; the cost of gas makes distribution more difficult; and government surpluses of farm products are gone.

''In 17 years, I have never seen the shortage of food we are seeing today,'' noted Patricia Robbins, founder of Farm Share in Homestead. ``While we are not turning people away, each person gets less food.''

UK: Land in demand to grow produce

More land for allotments is needed in Shrewsbury to meet the demands of a growing band of cost-cutting, green-fingered “yummy mummies”.

With living costs increasing by the day through rising food and fuel bills, more and more people feeling the pinch of economic pressures are resorting to growing their own fresh, organic fruit and vegetables.

Ammunition prices squeeze law enforcement budgets

A global shortage of precious metals has created an unpleasant reality for gun owners - higher ammunition prices.

For recreational owners, that means fewer hunting trips and days at the shooting range.

But for Whatcom County law enforcement agencies, it means reconsidering how they train officers and balance their budgets.

Sceptics say oil supply may not improve in 2009

"It worries me that everyone is projecting this relatively strong growth in non-OPEC output," said Julian Lee, senior analyst at the Centre for Global Energy Studies, a London-based forecaster.

"This leads to a sense of complacency that everything will be okay and that OPEC doesn't need to increase production."

Russia oil output seen up at 10.3 mbpd in 2010

MOSCOW (Reuters) - Russia expects its oil output will rise by 4.6 percent in 2010 compared to 2007, an energy ministry document showed on Wednesday, stopping short of making predictions for 2008-09.

Up to 100,000 B/D Brazil Tupi Field Output By 2011

A 50,000 to 100,000 barrel of oil equivalent a day pilot production scheme on Brazil's offshore Tupi field is planned to begin in 2011, the chief executive of BG Group PLC Frank Chapman said Thursday.

Speaking in a conference call he said an extended well test, with production in the range 10,000 to 20,000 barrels of oil equivalent a day, will begin on Tupi later this year in advance of the pilot program.

Guangdong plans 2 oil storages to ease shortage

South China's Guangdong Province, the largest oil consumer and importer in the country, is planning an investment totaling 6 billion yuan ($880 million) to build two strategic crude oil and oil product reserve bases, which was listed in the province's top 10 new projects mapped by Guangdong’s provincial economic planning body, according to the Caijing.

China oil use soars in 1H despite high world prices

BEIJING (Xinhua) -- Soaring world prices don't seem to have crimped China's oil use, with statistics released on Thursday by an industry group indicating that first-half consumption of oil and refined oil products set records.

The China Petroleum and Chemical Industry Association (CPCIA) said that "apparent consumption" of refined products -- gasoline, diesel and kerosene -- rose 14.6 percent year-on-year to 106 million tonnes, while crude oil use rose 6.3 percent to 183.3 million tonnes.

PetroChina to control fuel exports to ease shortages

BEIJING (Bloomberg) -- PetroChina Co. will extend its “strict control” on fuel exports into the second half of the year as China, the world’s fifth-biggest oil producer, seeks to ease a domestic gasoline and diesel shortage.

Chile says rains ease electrical rationing fears

A severe drought, which the government described as the worst in decades, had forced power providers to rely on expensive-to-run diesel generators. Compounding the problem, neighboring Argentina restricted natural gas exports to Chile.

"The probability of rationing has fallen considerably," Tokman told reporters in the Chilean capital, Santiago.

Supply lines: Is the Czech Republic too dependent on Russian oil?

Whatever the reason for the supply reduction, the current situation made it clear that depending too much on Russia for oil could prove too much of a risk in the future. Is the country prepared for the possibility of long-term shortages of Russian oil?

Boss of BP Russia venture leaves

BP has said the chief executive of its Russian joint venture TNK-BP has temporarily left Russia because of "sustained harassment".

Could it be...?

BANGALORE/MANGALORE, July 24, 2008: The power crisis which currently the state is experiencing could be an engineered shortage? This is being discussed in every corners of the seat of power Vidhana Soudha. Doubts are being raised and apprehensions are being aired about the "people behind" the power crisis that the state was undergoing.

Could it be that the Karnataka is being targeted as a state to demonstrate what could be life without energy, could it be that some forces want to show the politicians and people in charge of the government what energy deficient could look like. Could it be that Karnataka is a pawn in the global design of power politics?

Post-Peak Politics

The politics of peak oil form one of the most explosive and least often understood dimensions of the emerging crisis of industrial civilization. Too often, when questions of politics enter the peak oil discourse, they focus on the belief that the problem of peak oil can be solved by throwing one set of scoundrels out of power so that another set of scoundrels can take their place. This seems hopelessly misguided to me.

New York: Council Members Push Pedal To Add Taxi Fuel Surcharge

Fifteen City Council members are calling for taxi fares to be increased, saying they are ready to risk constituents' ire to prevent cabbies from leaving the streets.

Everything you need to know, in order

A student in my class asked me for a list of skills we need to get ready for peak oil, prioritized. I admit, it took me about a day after she asked to stop thinking “Holy Crap, how do I figure that all out!” But it is an interesting question. And while it isn’t all just about food preservation, I thought I’d take a shot at it. I will, of course, be relying on my fearless readership to point out gaps in my thinking.

Chop, chop: Firewood dealers struggle to meet demand

Rising heating oil prices, a shortage of loggers and increased demand for wood by the paper industry have driven up the cost. In addition, residents who used to wait until fall to order their firewood started buying it up in May or June this year.

Building a green collar workforce, one apprentice at a time

The tradition of apprenticeship – a craft master teaching trade skills to craft entrants – is one of the oldest and most effective methods of learning. That tradition continues in Minnesota today, and may be the key to growing a sustainable green collar economy.

UK’s Chatham House surveyed 12 hydrocarbon-exporting countries and concluded on growth of their dependence on oil revenues

UK’s Chatham House has completed its project - Resource Depletion, Dependence and Development. The project was funded by the Asian Development Bank, the Norwegian Ministry of Petroleum and Energy and BP.

The report oriented for period until 2030 looks at Algeria, Angola, Azerbaijan, Indonesia, Iran, Kazakhstan, Kuwait, Malaysia, Nigeria, Norway, Saudi Arabia and Timor Leste.

Petroleum-fuelled prosperity is masking the challenge of oil depletion and removing the sense of urgency that is desperately needed to promote diversification in oil-exporting states. All eyes are on supply-demand dynamics instead of how these countries" economies - so linked to our own - can be sustained as oil and gas resources deplete.

A new report by Chatham House says today's oil-price boom may be raising the global profile and financial clout of oil-exporting countries but their dependence on oil, (and gas) revenues has increased. This cannot continue: production will level off and eventually fall; rising energy consumption at home will reduce the amount available for export. For these countries to continue to grow, dependence on oil revenues must be reduced.

Entergy chief explains rising costs

“We are in a national energy crisis, and the culprit is natural gas,” he said. “The sharp increase in costs is unprecedented. We've seen spikes before, but never seen these sustained increases. Natural gas is up in price 85 percent from January.”

Fuel costs will rise under any future president, experts say

WASHINGTON -- No matter which one is elected president in November, the energy policies proposed by Sens. John McCain and Barack Obama would increase costs for the average American, but other changes may not be as readily visible, experts say.

While the candidates’ policies are distinct, several energy policy experts agree that both want long-term changes that will not immediately address the high gas prices and energy bills seen today.

Americans must diet to save their economy

Want to save the US economy? Go on a diet.

That's the message ecologists are trying to get across this week. They say the apparently looming energy crisis could be averted if US residents cut their calorie intake.

David Pimentel of Cornell University and colleagues have drawn on an extensive body of existing studies to highlight the wastage in the US food production chain. To bring their point home, they have estimated how much energy could be saved by making a few relatively simple changes to the way corn is produced.

Ethanol pipeline places the cart before the horse

Iowa Sen. Tom Harkin and Indiana Sen. Richard Lugar have proposed the construction of a pipeline able to bring Midwestern ethanol to the East Coast, where demand is high. However, given ethanol's current lack of overall cost-efficiency, much of the project's benefits will simply be accrued by the ethanol industry itself. But then again, as long as it's carrying ethanol, Midwestern politicians have always been happy to put the cart before the horse.

Pemex plans Ku-Maloob-Zaap fields subsea pipelines

LOS ANGELES -- Petroleos Mexicanos plans to start building two new pipelines—one oil and one natural gas—in October at the Ku-Maloob-Zaap group of offshore oil and gas fields.

Saudi Arabia: Diesel shortage worsens for farmers

BURAIDAH – Rural areas of the Kingdom are facing an increasing problem of diesel shortage which is threatening their ability to produce and irrigate crops properly. The problem originally confined to the Taif region has now spread to Al-Jouf and Hail regions.

Saleh Al-Shayea Al-Krei’, owner of an agricultural project in Al-Jouf, said the filling station in Al-Jouf is unable to supply diesel distributors with sufficient quantities, as it has decreased the quantities granted to farmers by 60%.

The coming gas supply shock in the Gulf

IT IS ironic that the Arabian Gulf, which contains two thirds of the world’s proven oil reserves and is the epicentre of the energy business, faces a regular gas shortage, possibly as high as 7 billion cubic feet in the next decade. This is going to have a seismic impact on the GCC’s oil production, consumption and exports, a major factor in crude oil prices.

Electricity Expert Scotto: U.S. Power Rates to Double Over Next 5 Years Due Primarily To Lack of Supply (Part 2 of 4)

Leading Wall Street electric utility analyst Dan Scotto predicted U.S. electric rates will double within five years due primarily to lack of supply. The increase will be on top of a 25% rate rise Americans have had to endure over the last few years, he said.

ConocoPhillips Net Rises 13%, Beating Consensus Target

NEW YORK (Dow Jones) -- ConocoPhillips on Wednesday said second-quarter net income rose 13% over its year-earlier adjusted profit, as the first of the three major U.S. oil giants to report financial results benefited from higher oil prices in its exploration-and-production business.

Colorado, Wyoming battle Bush over oil shale

SALT LAKE CITY - The Bush administration's push Tuesday to speed up development of oil shale in the Rocky Mountains runs headlong into Colorado and Wyoming leaders, who say the environmental costs are too high and the technology unproven.

New contamination incident at French nuclear site

PARIS (Reuters) - Around 100 staff at a nuclear power plant in southern France were contaminated with a low dose of radiation on Wednesday, power firm EDF said, the latest incident there after a case of uranium spillage two weeks ago.

Where would America’s renewable energy come from?

According to the Energy Information Administration, the average American consumes about 920 killowat-hours of electricity per month.

So where, exactly, will all this energy come from? And how do we get it from there into our wall outlets?

Gas Conservation Threatens Road Funding

Conservation means less gas-tax revenue is going into the Highway Trust Fund, which Congress taps every year to send transportation funding back to the states. Current estimates indicate the trust fund will take in at least $3 billion less than Congress planned to spend next year, and that deficit is expected to widen substantially in the years ahead.

Libya halts oil shipments to Switzerland

TRIPOLI (Reuters) - OPEC member Libya is halting oil shipments to Switzerland in protest at the arrest of a son of Libyan leader Muammar Gaddafi, workers of state-owned Maritime Transport National Corporation said on Thursday.

All ships carrying Swiss-made goods are barred from unloading their cargoes at Libyan ports, they added in a statement issued shortly after they staged a protest outside the Swiss embassy in Tripoli.

Swiss Oil Industry Brushes Off Libya Threat

"Libya would be punishing itself," the head of the Swiss Petroleum Association Rolf Hartel told AFP. "Economically it would make no sense."

He said Switzerland had four-and-half-months of reserves of gasoline, diesel and fuel oil and three months of kerosene, and could easily acquire oil products from other countries within days.

Russian S-300 missiles 'would ensure Venezuela's oil security'

MOSCOW (RIA Novosti) - Russian S-300 air-defense missile systems would enable Venezuela to fully ensure the security of its hydrocarbon resources, a Russian military expert said Thursday.

"Needless to say, should S-300s be delivered to Venezuela, they would effectively strengthen its defense capability, and it would not be easy for its possible adversaries to punish the country by striking at its oil fields," former Air Force commander Gen. Anatoly Kornukov said.

He added that as an oil-rich country Venezuela had to protect its natural resources.

Iran boosts gasoline imports around 50 pct

DUBAI/SINGAPORE - Iran is buying more gasoline and gas oil on international markets to boost stocks ahead of a heavy work schedule at oil refineries in the fourth quarter, trade sources said on Thursday,

"They've already started buying and it's being felt in the market," one trader said. "Gasoline imports are up around 60,000 barrels per day for August and September."

Ford posts $8.7B loss, accelerates shift to small cars

DEARBORN, Mich. — Ford said Thursday that it lost $8.67 billion in the second quarter largely because of a reduction in the value of assets.

The company also announced that it will bring six European small-car models to North America by the end of 2012 as it deals with a market shift from trucks to cars brought on by high gasoline prices.

The company also will retool two more North American truck and sport-utility vehicle plants to build small, fuel-efficient vehicles.

Scottish & Southern Energy warns on profits as fuel bills set to soar

A fresh round of energy price rises looked inevitable today as Scottish & Southern Energy (SSE) issued a stark warning that its first- half profits would be substantially lower than the results achieved in previous years.

Ian Marchant, chief executive of SSE, said that it was becoming increasing difficult to keep retail energy prices down, as wholesale prices soar.

"The extent of the energy shock with which the entire global economy is having to contend has been well-documented, and its full impact on prices for electricity and gas in the UK has still to be felt. We are continuing to resist the pressure to put up prices for domestic customers, but doing so is becoming more difficult by the day," Mr Marchant said.

Malaysia sweetens deal for independent power firms

KUALA LUMPUR (Reuters) - Malaysia will allow exemption from windfall tax for independent power producers (IPPs) which agree to alter electricity sales terms with power utility Tenaga Nasional, the finance ministry said on Thursday.

The government last month proposed a windfall tax on the IPPs and other industries least affected by inflation to help curb price pressures.

Can fuel hedges keep Southwest in the money?

Using some simple and some complex investment strategies, Southwest has for a decade locked in the prices it pays for large amounts of jet fuel months and even years ahead of time. Its success at that has protected it from run-ups in crude oil prices and dramatically cut its fuel expenses. Since 1998, it has saved $3.5 billion over what it would have spent if it had paid the industry's average price for jet fuel. That's equal to about 83% of the company's profits over the last 9½ years.

Who will solve the oil puzzle?

What is the biggest news hogging the limelight in the media these days? It is crude oil prices. What is intriguing is that nobody has so far come up with an acceptable thesis on why it is defying gravity and going only upwards. All possible explanations have been put forward by pundits and forecasters. One team, led by Arjun Mistry of Morgan Stanley, forecast that crude prices would touch $200 per barrel soon.

Want floor time? First, get past Bartlett

By his own count, Bartlett has given 48 hourlong floor addresses since March 14, 2005 –– far more than anyone else, and almost all of them on peak oil, the notion that when oil production begins to decline, prices will skyrocket and bring the world economy to its knees.

With oil prices in the stratosphere, is it time to start listening to the House of Representatives’ Chicken Little?

As oil price rose, exporters cut shipments

The world's top oil producers are currently proving unable to generate more barrels on demanding world markets, despite surging prices — a shift that defies traditional market logic and looks set to continue.

Fresh data from the U.S. Department of Energy show the amount of petroleum products shipped by the world's top oil exporters fell 2.5 percent in 2007, despite a 57 percent increase in prices, a trend that appears to hold true this year as well.

There are several reasons behind the net-export decline.

Peak Oil as a Direct Result of Misallocation of Funds

We have a paradigm shift. The misallocation of funds that are the result of Fractional Reserve Banking and creation of money out of thin air are the motor behind the actual and future shortage of liquid energy. Instead of allocating funds to new exploration, drilling and the modernization of refineries, the funds were used to fuel the worldwide bubbles in real estate. Because of an oversupply, real estate prices are going down…and ironically, because of an undersupply, oil and gas prices are going up.

The myth that pushes oil prices up plays into the hands of speculators

Something is wrong and it might just be that Peak Oil is the culprit. Take, for instance, the claim that the theory correctly forecast the 1965-70 'peak' in US oil output. This may well be true, but it proved correct only because of political intervention -- the US slapped a ban on exploration over wide swathes of sensitive territory and at the same time put limits on what could be produced from existing fields, part of its bid to establish a strategic reserve of home-produced oil. Little wonder then that oil output peaked when it did. Left to its own devices, the peak in US output would have been markedly different.

Opposing Views Launches As A Debate Site Where Experts Go Head-To-Head

Getting average know-nothings to create content for your site is easy enough and well understood by now. But how do you get experts to create in-depth topic pages about the hot-button issues of the day, complete with videos, links, and healthy commenting? Russell Fine is trying to do that with Opposing Views, a site that launched a few hours ago. It pits experts against each other on topics such as the economy, global warming, health issues, and politics. "We are trying to create a site where people can get well-informed on a topic quickly," says Fine.
(See Have we reached peak oil?)

Dengue cases in Philippines rise by 43 percent: government

MANILA (AFP) - Global warming may have contributed to a 43 percent rise in the number of dengue cases in the Philippines for the first half of the year, the health secretary said Wednesday.

..."The increase in the number of dengue cases may be attributed to the constantly changing climate brought by global warming as well as congestion in urban areas," health secretary Francisco Duque said.

Rising fuel prices are hitting cabbies hard:


An association representing 4,000 taxi drivers across the province is asking the Quebec Transport Commission for a 10-per-cent fare hike, citing the high price of fuel and the chunk it is taking out of cabbies' revenues.

Low-cost airlines are also still getting battered.

Easyjet plans cuts as costs bite

Budget airline Easyjet will cut flights over the winter to offset a challenging economic climate and the high fuel prices that have dented profit growth.

Easyjet said its annual fuel costs have increased by about £185m. As a result, its full-year earnings will be less than many analysts had been expecting.

It will cut capacity at Stansted by 12% over the 2008/2009 winter. Easyjet shares fell 3% in London on the news.

Same thing at Ryanair:

British Airways Plc, Ryanair Holdings Plc and Air France-KLM Group had their earnings estimates cut by analysts at Merrill Lynch as fuel costs increase and demand for air travel slows.

And they still continue their price obsfucation shenanigans.

Mississippi River at New Orleans shut down for days

A tanker full of bio-diesel and styrene cut in two a wayward barge full of 10,000 barrels of #6 residual fuel oil yesterday morning. As of 9 PM yesterday, 25 ships held up. Collision less than 2 miles from my home.

The Coast Guard says that it will be days before they re-open the Lower Mississippi "depending on developing conditions". The Intercoastal Canal also appears to be shut down at New Orleans.

Water intakes for potable water in Algiers (New Orleans West Bank), St. Bernard and Plaquemines Parish shut down and potable water will need to be trucked in today or tomorrow morning if the oil does not clear by then.

The smell is gone around my home.


Does bio-diesel and styrene mixed together give you environmentally friendly napalm?

Just out of curiosity, can this oil be recovered? It seems like for $120+ per barrel (I almost said "per gallon"), it might be worthwhile to suck it up and try to process it. Can you put a mixture of oil and seawater into a normal refinery?

It was biodiesel already, no need to put it into a refinery. Unlike ethanol it floats on water, but I doubt it can be profitably recovered. It will be polluted by bacteria, and that causes all sorts of problems.

Thank YHWH the styrene didn't leak - It's a hideously dangerous chemical: volatile, flammable, explosive, poisonous, and carcinogenic.
Polystyrene is dissolved in gasoline or diesel to make one of the recipes for napalm - not styrene.

Hmmm. Model Rail enthusiasts use this stuff all the time to build things out of. ...Unless it's a different Styrene.

By 5 PM, more than 60 ocean going ships were backed up. Plus barges.


The company also announced that it will bring six European small-car models to North America by the end of 2012 as it deals with a market shift from trucks to cars brought on by high gasoline prices.

It's almost as if they read theoildrum.com. :) Now let's see if they survive until 2012, I guess they will. Incidentally, I was examining a late model Ford Fiesta yesterday before dinner (I'm in Munich right now) and my thought was that it was a very good looking car. Quite stylish, it was reminiscent more of a Honda than a Ford. I bet it will sell decently well here barring that things do not return to the former era of cheap oil.

Too little, too late. Figure on $200/barrel oil or more. Figure on Mitsubishi (and others) marketing EVs with 100 mile ranges.

Who's going to invest in gasoline/diesel when they can get good EV?
Between now and 2012... they have NOTHING.

Given that Toyota is apparently having difficulty meeting demand for batteries for their Prius, don't you think batteries in general may be an issue and that many people will be forced to choose a high-mileage ICE vehicle as their second choice?

People "underwater" on their gas guzzler and in debt to their utilities will not buy any new car.

That, too.

Nothing makes the point clearer than this chart from the Wall Street Journal:


Oil down $20 bucks from the high, and CNBC hosts today talking about buying SUVs, one of them had her husband buying a minivan today, and the other wanted to buy an SUV because they were getting so cheap…

I guess a lot of people still think that the climb in oil prices is a just a blip, and all will be fine in a couple of years with technology and the artic oil reserves! …

The reality of peak oil remains illusive to the absolute majority of the people, and oil prices have a long way to go before people “never ever” think of buying an SUV!!!..


I still cannot help but think the 3,566,138 trucks and SUVs are going to seriously be offset by 100,000 Prius's. Even if you include the 200 to date that have plugs.

It still looks like denial to me, at least for the 2,017,941 driving brand new SUVs. Those guzzlers are going to be guzzling for the next 20 years.

Nice graph, though. Thanks.

This entry at AutoBlogGreen gives some more details on Ford's plans:

Ford to retool 3 truck plants for small cars starting in December

Starting in December of this year, three truck plants will be retooled so that they can build cars instead. In addition six new models will be coming over from the European lineup and Mercury will live on. Like other automakers Ford will be consolidating production of large trucks into fewer plants..... The Michigan plant will retool to build to build a vehicle based on the European Focus platform. As previously announced the Cuautitlan Assembly Plant in Mexico will shift from building F-series pickups to the new Fiesta at the end of next year. A second plant in Louisville that currently builds Explorers will switch over to building Focus based vehicles as well.

The European Fiesta ECOnetic (which I mentioned a couple of days back) gets 75mpg on highways according to the EU test cycle. Hopefully that's what will be built in Mexico.


from the latest "myth" myth:

"the US slapped a ban on exploration over wide swathes of sensitive territory and at the same time put limits on what could be produced from existing fields,"

does anyone in tod land know what this boyles character is talking about ?

what i mean is the part about putting limits on what could be produced from existing fields. the states regulate all onshore production. i dont know about offshore.
the states that regulated production (texas and new mexico) were relaxing restrictions, if anything, due to declining potential.

if i recall correctly, prices were regulated back then (remember tricky dick nixon) and if anything the federal govt was encouraging higher production with unregulated pricing on "new oil". there was also a bonus for increasing production because for every barrel of "new" oil, an additional barrel was "released"(allowed to be sold at market price).

and incidentally, the market price was $3.50/ barrel.

edit: on further reading, it is apparent that boyles listens to a lot of rush limbaugh drivel.

Another day, another POD (Peak Oil Denier) Person.

In any case, this is why I constantly cite the Texas & North Sea case histories. There is one key reason for the production declines: the smaller fields that we have found post-peak can't offset the declines from the older, larger fields.

how 'bout this statement, westex ?

"Little wonder then that oil output peaked when it did. Left to its own devices, the peak in US output would have been markedly different."

Without the exact stats, anyone can answer that question: peak could have been delayed for a few years... just like world peak could be delayed a few years if everything was peaches and cream.

It hardly matters.

"slapped a ban on exploration over wide swathes of sensitive territory.."

It must have been in cahoots with the folks who were putting that kibosh on Discovering an increasing amount of Oil back in '64/'65. (sarcanol)

The 'Drill more' crowd has been using this spin on the US Peak for a few weeks now.

"The 'Drill more' crowd has been using this spin on the US Peak for a few weeks now."

the first i'm aware that they have specifically blamed the '70's peak on "the democrats and their pinko environmental supporters"

It appears to be a highly coordinated marketing campaign. I have already fielded spam emails from relatives about ANWR and how high gas prices are the Dem's fault.

We knew the oil companies would blame the environmentalists for peak oil (rather than admit to being wrong). Here we go!

It is an election year.

Let the spin begin: Peak Oil aware friend in Mineapolis sent me e-mail yesterday:

"So I'm out mowing the lawn (yes, I need to give it up for the engine free model) and this young Sierra Club volunteer comes by petitioning our U.S. Senators to NOT drill ANWAR. He was so happy I signed his petition and he told me most people told him to go away because they are for drilling wherever it takes to get their "fix". I told him to keep up the good work and keep up the good fight."

I think the Republican talking points machine has once again outmaneuvered the hapless Democrats on this issue and that may cost them the election.

"Drill, drill, drill so we can drive drive drive." Not quite a bumber sticker but could be a T-shirt.

I personally think that the Democrats should borrow Jon Stewart's line about how the Republican plan to deal with our oil addiction is to drill for more oil. "Yeah, I've got a heroin problem alright, I'm out of heroin!" I think this would gain traction (the oil, not the heroin) to use as a spring board to put forth plans for more funding for alternative energy. Combined with this they might focus on the ten year lag time for the oil to come on line, the fact that the total reserve estimates might sound like a lot, but they would only produce a small percentage of the U.S. daily consumption.

Fighting the agents of denial and mis-information is an uphill battle. Quoting Leanan:

"Welcome to the Theatre of the Short Attention Span."

How do you persuade people who are only concerned with "the cost of eggs" to invest time in a message that is a threat to their personal lifestyle. For me there is a general disconnect. When I say sustainable economics people think "Buy a Prius". When I say that it may involve riding a bike, walking and learning how to grow their own food they immediately tune me out.

If I were running for political office would I be talking about Peak Oil? Not if I wanted to get elected...

Debbie Cook is running doing a fantastic job discussing PO.

I have a crush on Debbie Cook.


I think I will go to her election night event.

OK, Fine, I got two negative ratings probably for linking to the cheesey song.

But she is doing a great job. Here is a sample of what she is saying:

“There has been a lot of talk in the last couple of days about lifting the ban on drilling for oil along the coast. Dana Rohrabacher, John McCain and today President Bush have joined in a chorus of “drill, drill, drill,” as if that will solve our energy problems.

“Time is not on our side, and continuing to divert our attention away from the real problem is a disservice to our citizens and a failure of leadership.

“World oil production has been flat for three years. America’s oil refineries are configured to refine light sweet crude and are currently operating at 88% capacity and paying a premium for this short supply. There is no point for the Middle East, the only region that may have spare capacity, to increase production of heavy sour crudes until new refineries are built or existing refineries have been modified.

“Three fourths of the world’s oil and gas wells have already been drilled in North America. Our continent is so heavily explored that it looks like swiss cheese. Eighty percent of the oil available on the Outer Continental Shelf is already open to leasing and drilling. Will opening the remaining 20 percent make any difference when it takes 5-10 years to bring any new oil discoveries to market?

“Perhaps we should just call the President’s bluff, sell off the leases and then get on with the real work ahead of us, leaving fossil fuels before they leave us.

“The world economy depends upon the flow of oil, not the oil that remains in the ground. The fact is, more than 50 nations are now past their peak in oil production: Mexico, Norway, UK, USA, Russia, perhaps even Saudi Arabia to name a few. If you use ExxonMobil’s estimate for the decline rate from these existing wells (-6%), then from now until 2017, we need to find and develop 37 million barrels per day of additional crude production just to stay even with what we consume today. That assumes no growth in demand for oil. That is the equivalent of finding FOUR Saudi Arabias. Does anyone think we have overlooked resources of that size and quality?

“George Bush and Dana Rohrabacher’s failure to understand the fundamental economics and geology of oil and gas production is matched only by their failures as leaders.

“The true solution to our energy problems starts with conservation efforts, and investment in alternative and sustainable energy sources, which will create new American industries and jobs and jumpstart the sluggish economy.”

Actually, I think you got rated down because it's a partisan political video. But we'll never know because the "drive-by minus clickers" almost never take time for rebuttal.

If Debbie's reading, I liked the video for the facts it conveyed, but the song is distracting.

My personal guidelines for modding people is that up is for posts i approve of, down is for off topic and obvious troll. I think this is a better style for encouraging good discussion. I've seen sites try to enforce my style of modding, but unfortunately it never pans out. I like this style because it makes it easier to sort the posts as agreed with, boring/not agreed with, and waste of time. When you mod down things that you just don't agree with, it makes you spend more time trying to figure out what is controversial and what is just crap. Anecdotal evidence shows me that off topic/troll posts tend to be longer than boring ones.

Holy cow! I never even noticed the rating system on here before! Wow, I guess that shows how much attention I payed when the upgradge/changes were made! Haha.

"...the Democrats should borrow Jon Stewart's line..."

good idea, but it wont fit on a bumper sticker so it will likely be beyond the comprehension of the vast majority of voters.

It may not be that hopeless. In the short term the knee jerk reaction to tight supplies is to offer to increase supplies. In the longer term I think it is possible for the public to catch on to the reality of the situation if it can be put forth in simple terms. The public did not fall for GW's plans for privatizing social security.

the first i'm aware that they have specifically blamed the '70's peak on "the democrats and their pinko environmental supporters"

It makes sense though. If they're going to blame the global peak on commie environmentalist democrats, they have blame the US peak on the same cause. Of course, they blame EVERYTHING on commie environmentalist democrats.

This is why I reluctantly encourage all commie environmentalist democrats to arm themselves (you don't have to become a gun-nut, eagerly awaiting your chance to use it, just have one put away). If we do end up having an ugly collapse and chaos follows, the ditto-heads are already prepared to blame the leftists for everything, and the facts won't matter if they have a gun and you don't.

I absolutely agree. This is the reason the NRA supports personal weaponry and the far right supports militias: they're certain that, given the opportunity, their kind will always have blacks, gays, leftists, Jews, urbanites, women, atheists and the poor outgunned. When the government finally collapses, they will return society to its "natural" 1776 state, in which only they are voting citizens. The only question is how deeply penetrated the current authorities (including the military) are by such people.

Look to the Bosnian war, where the multicultural and multireligious cosmopolitans of Sarajevo (white Moslems for God's sake) were expected to be easy cleansing for the redneck Serbian death squads equipped with heavy weapons from Yugoslavia's national militia system. The city was saved by its gangsters, who organized its defense against annihilation.

What propaganda have you been reading. Half the city was inhabited by Serbs and was ethnically cleansed by the BiH (Muslim) forces. CNN newthink translates civil war frontlines into ethnic cleansing. I guess since the ICTY has released butcher Nasir Oric everyone should swallow the black-white, good-evil fairy tale. It was Izetbegovic who wanted a pure unitary Muslim state. He was all too willing to break the 1992 Lisbon accords which provided for an independent non-unitary Bosnia i Herzegovina at the prompting of the USA. Given that his group had 43% of the population and no history as an independent state the Lisbon accords were more than generous, but for zealots it is never enough.

Oddly enough, i was looking up all the post-Yugoslavian wars in the Balkans earlier today. What a mess, i was hoping to get a sort of cut and dry explanation, but it looks like I'd actually have to sit down and research to figure it all out. What i did gather is that nobody seemed to have clean hands in the situation, which makes me wonder if the "because they are our friends" political double-standard is being applied. My gut says yes.

At this point, I'd be willing to put a lot of my political beliefs aside and vote for a major party candidate whose policies didn't revolve around a complex series of double standards

Elwood, the guy is an idiot. At that time few, if any, bans were in existence. And as for limits on what could be produced on existing fields, this was the time they were lifted! The Texas Railroad Commission had for years limited output from existing fields in Texas due to a glut in supply. In 1972 all limits were lifted because of falling supply. Since that date there have been no limits on output from existing fields in Texas or anywhere else in America.

But the man makes several other extremely stupid statements:

Then there is Saudi itself, where the giant Ghawar field -- reservoir for a quarter of the planet's known oil reserves -- is crying out for the type of investment which can extend its life and boost its production levels for decades to come.

First, Ghawar does not have anything even close to a quarter of the world's known reserves. Saudi Aramco, according to Wikipedia puts Ghawar reserves at 71 billion barrels but that is probably a gross exaggeration. That being said, no other nation on earth is investing more in their old fields than Saudi Arabia and they are employing the world's best contractors in that effort.

However this article does highlight one fact, that is that most critics of Peak Oil haven't a clue as to what the hell they are talking about.

Ron Patterson

most critics of Peak Oil haven't a clue as to what the hell they are talking about

Unfortunately, most of their readers/listeners don't either. That means the denialist noise machine that was created in the wake of the tabacco hearings can run full bore. For everyone who knows what they're talking about, they can put up a clueless git as "balance". The public is clueless as ever, but they know they like what the clueless git is saying.

As I've said many times, I'm not a doomer because of the geology. I'm a doomer because of human idiocy.

"...I'm not a doomer because of the geology. I'm a doomer because of human idiocy."

My sentiments exactly.

Somehow, I manage to keep them both together in one nicely integrated scenario.

I'm hopeful, as long as people actually get their act together and do something.

Do I think they will? Not a snowball's chance in Hell.


Ron, I thought you were on the road to recovery but you must have missed a couple of meetings. Why is everyone that disagrees with you and IDIOT? How about 'I think he is wrong because'...?

...And, citing Wiki as a source of Ghawar reserves is really lame. Wike nor you have any idea what the Ghawar reserves are.

...'Most critics of PO haven't a clue as to what the hell they are talking about'... and you do? PO is a fact. It is coming. If it isn't here today it will be soon enough. Why the rush? Remember, if you don't live long enough to say 'I told you so', someone else will.

pat boyle MAY not be an idiot, but he sure quacks like one.

River, it seems like you're fishing. Idiot is a good description of the guy who wrote the article. And Ron did cite at least some of the most glaring reasons he was wrong.

Citing Wikipedia for Ghawar is absolutely reasonable when what you're trying to do is establish the baseline concensus for what is in Ghawar. He wasn't citing it as authoritative; he even pointed out he thought it was wrong. Is there anyone but the buffoon who wrote the article that thinks Ghawar has 1/4 of the world's oil reserves?

Also, I don't get any sense that Ron is trying to rush Peak Oil. He's trying to rush an understanding of peak oil. I'd hope we're all trying to do that, and not just sit back with a bag of popcorn and watch.

I have a request: how about leaving all epithets out of the conversation so that we can stay focussed on the points at hand?

Almost every time someone uses one (an epithet), the rest of us have to wade through much noise as the age of the conversation quickly plummets to five or six years old.

One need not use an epithet to insult, as river occasionally reminds us.

I yearn for a society in which what you say is more important than how you say it. River's post was a pile of poo. Period. Nothing wrong with saying so.


The difference, as your mom no doubt told you, is between calling River's post a pile of poo, and calling River himself a pile of poo.

Ideas can and should be folded, spindled, and mutilated. Not so the people who hold them.

I thought about this after reading the front page LA Times article about peak oil. The reporter wrote:

The boiling debate, in which peakists and their critics flay one another's conclusions and intelligence, is fed by imprecise terminology and oil-field data that are questionable or incomplete. For starters, views vary wildly on how much oil remains in Saudi Arabia -- crucial information for projecting worldwide supplies.

I think she was talking about us, and it really doesn't make us look good.

I'm as guilty as anyone, I suppose. It's hard to resist poking fun at, say, Yergin, especially since he's not here to get his feelings hurt. But I suspect things like "Triple Yergin Day" look really juvenile to mainstream America, not least because Yergin is a respected expert, and we're just bloggers.

All true, but if people had stood up and called a spade a spade over the last 7 or 8 years, things might be pretty different.

It is possible to be too polite and too careful in what is said. Suffice to say River does his share of picking at people, so I don't get much from his going after others for same. His post was, iow, hypocritical. That style of insult - using supposedly polite forms to insult - is one of my pet peeves.

I don't mind a little mix-up (obviously; comes from growing up in a large family of virtually all boys with no '60's to '80's), but I don't have much tolerance for unfair and/or hypocritical shots.

Best hopes for kinder, gentler dialogues.


All true, but if people had stood up and called a spade a spade over the last 7 or 8 years, things might be pretty different.

I don't think so. I think it would have just painted all peak oilers as crackpots.

Which isn't to say there isn't a place for that kind of thing. Kunstler comes to mind. But that's not really our style here at TOD.

Is there anyone but the buffoon who wrote the article that thinks Ghawar has 1/4 of the world's oil reserves?

Well, River seems to think it is a possibility. ;-) And River, it is the SAUDIS who claim that Ghawar has 71 billion barrels of reserves. Wikipedia was merely quoting what the Saudis claim. Saudi claims to have 260 billion barrels of reserves, 71 of which are in Ghawar.

Ron Patterson

And may I remind everyone that the little bit of study applied to the veracity of Wikipedia found it to be equal, overall, to formal encyclopedias. Thus, river is attempting to cast aspersions where they are not legitimate. How do we say this politely? He's lying? He's misleading? He's biased against the source? He made an honest mistake?


Hello Ron, I have been taking care of some biz and am off to bed soon.

To put this entire notion of Wiki being correct on the Saudi reserve numbers into perspective need I remind you that all the OPEC members increased their claimed reserves long ago? Why did they do that? Well, it was a matter of money...More claimed reserves allowed OPEC nations to pump and sell more oil because production and sales were based on reserves. So, they all lied and they continue to lie.

Now SA has reported to the world that their reserves are such and such...but are they? Wasn't there a big row recently when someone suggested that outside auditors be allowed into all oil producers to confirm reserve claims?

My question to you is: Why do you suddenly believe what SA says, or what WIKI reports, regarding SA reserves? Is it because that now it is convenient for you to believe SA, even though they are known liars, because it fits what you want to believe?

You're logic isn't. I stand by what I said earlier...You have no idea what the SA reserves are and if you claim otherwise you are a charlatan.

River, here is exactly what I wrote, cut and pasted from above with emphasis added:

First, Ghawar does not have anything even close to a quarter of the world's known reserves. Saudi Aramco, according to Wikipedia puts Ghawar reserves at 71 billion barrels but that is probably a gross exaggeration.

Now my question to you is: Exactly what does gross exaggeration mean?

Ron Patterson

'Baseline concensus'? What hogwash! How can you get a baseline consensus out of SA or WIKI figures that are based on supposition? Your case would be dismissed by any judge in the land.

Ron is a pot stirer. He has no more clue what SA reserves are than you do or I do.

SA and all OPEC countries have consistently lied about reserves for years and you know it. They use X amount of oil but the next year magically they report their reserves are the same as last year. Why?

It's about the money! When the quota system existed among OPEC produceres the quotas were based on claimed reserves. The quotas have been lifted for a time but OPEC members are well aware that they might return if enough demand destruction occurs. So, they all continue to lie about reserves.

Anyone on this board that claims to know what SA oil reserves are is a charlatan...and they know it. Anyone on this board that claims to know what the world total oil reserves are is a charlatan.

'Baseline consensus' is a fancy way of saying 'a guess by a lot of people that don't know much because oil producers keep their reserves close to their vests'. Get real.

WTs models of various decline rates base on past oil field histories and current production (if these production numbers are to be believed) is the best info that we have. Your 'baseline consensus' is baloney.

get popcorn, roll film

Although I agree somewhat with your general comments on TOD, I get the feeling you read strange things into other people's posts here... you seem to attribute things to others that aren't there.

I went out to dinner... (the place was at about 1/5 of it's usual crowd of a year ago). People started saying that the price of oil was down and that the stock market was up. "Things are turning around." One patron started singing "Happy Days."

I didn't say anything, but I think that people are under a lot stress economically to produce this kind of passionate (relief) response after seeing improvements over such a SHORT time. I don't remember ever seeing such strong emotional anxiety driving public opinion over a long term (not even after 9/11).

I think that politicians are playing on this passion with this off-shore drilling issue. I worry what happens when things don't get delivered. I'm seriously worried that these politicians don't have a clue that the matchbox they just found to play with may be one that's been soaked in gasoline.

I didn't say anything, but I think that people are under a lot stress economically to produce this kind of passionate (relief) response after seeing improvements over such a SHORT time. I don't remember ever seeing such strong emotional anxiety driving public opinion over a long term (not even after 9/11).

I think that politicians are playing on this passion with this off-shore drilling issue. I worry what happens when things don't get delivered. I'm seriously worried that these politicians don't have a clue that the matchbox they just found to play with may be one that's been soaked in gasoline.

Having recently read Naomi Kleins "The Shock Doctrine" I am tendign to see a lot of things - like this - as classic behavior on the part of the neocons many, if not all, are adherents to Friedman's Chicago School of Economics thinking.

Essentially pass legislation and/or establish economic policies that ordinarily would get close scrutiny but when the populace is under stress - things that ordinarly would not have a chance.

If you (collective you) have not read the book PLEASE do so. I was so persuaded by others here on TOD.


Having recently read Naomi Kleins "The Shock Doctrine" I am tendign to see a lot of things - like this - as classic behavior on the part of the neocons many, if not all, are adherents to Friedman's Chicago School of Economics thinking

Pearls before swine.

I haven't read her book but will read both the review and it since I've been meaning to for a while.

In the meantime, I can highly recommend John Perkins' Confessions of an Economic Hit Man and its follow up book A Game as Old as Empire: The Secret World of Economic Hit Men and the Web of Global Corruption.

I also heard Mr. Perkins speak...he may quite literally have put his life on the line by writing that book. He was part of the group that "engineered" (i.e. "fixed") the numbers so that economic development projects had completely unrealistic revenue projections. The money loaned to developing countries thus never got repaid, leaving the borrowing countries forever in debt.


Read this...

"Bad Money: Reckless Finanace, Failed Politics, and the Global Crisis of American Capitalism" Kevin Phillips

Then read Shock Doctrine.

I own a copy of Bad Money but I've (perhaps just temporarily) abandoned it. I find his writing not quite incoherent but not very easy to read, either.

IMO the review reads like a typical right-wing hatchet job, full of ad-hominems and arm waving generalizations.

I don't take everything in the book as literal fact, and I recognize that it has shortcomings, but I do think it paints an accurate picture of the marriage between corporatism, neo-conservatism and fascism.

Agreed about the shortcomings comment.

I realize this is getting off "TOD" topic, but one of the areas that I am unstettled about is the outsouring of goverment functions. In Irag we saw/see the outsourcing of "logistics", "security", etc. At home it is the outsourcing of things from disaster recovery (Post Katrina), processign tax returns, etc. On a more local level leasing out highways to the private sector. Etc, etc, etc.

On the one hand the US Government over the years has demonstrated quite a level of incompetence and wasteful spending in most areas. On the other hand the performance of the private sector in Post Katrina and Iraq has been extremely wasteful if not down right criminal.

It's how the US Government at once shrink in term of people and yet expand spending to the detriment of all.


I don't think it matters if it's govt. or private sector... as in any business venture, what matters is the ability of the person in charge.

Outsourcing government work is a win/win for a government that wants to skirt the constitution and international law (i.e. security, torture, etc.) and also create jobs to pad statistics.

I don't think this is off the Peak Oil topic at all. I think some of the elites knew this crisis was coming, and welcomed it as a way to return society to a model in which elites had absolute power: feudalism.

What is feudalism? Think of it simply as the creation of a super-class that monopolizes military functions first, then log-rolls that into a near-monopoly over land and a monopoly over government. The same families control all the top positions in civil government, army, and land-based economy, being both private and public actors at once. Forget about conflict of interest, here it's a way of life.

So in a feudalist world Baron Fathead is both a Fortune 500 company, and the head of a private army which he rents to his jousting buddy the king to turn on the peasants to collect taxes. Thus, it's not surprising that he wins the royal monopoly on salt mining. Worse, his cousin Bishop Fathead works for the biggest landlord of all, the Church. The Church functions as the media, putting out coordinated talking points from all its franchised outlets, and heaps praise on Baron Fathead.

Now is this a "small" government society or a "big" government society? Does the government control industry, or does industry control government? These right-wing semantics are irrelevant, because the only thing you need to measure is concentration of power, and it's already right where they want it to be after collapse. We could also call it fascism, but then European fascists considered feudalism to be the "good old days", to which they would return by their temporary reign of centralized terror.

I think there are more than a few people at TOD who welcome all this, expecting to become lords over the "welfare mothers" and "treehuggers" because they got in on the ground floor. They are mistaken.

Big gov't is big gov't, regardless of whether it derives its growth from communist or fascist ideals. I think the left digging the right over some mythical neocon-led defense-industrial complex and the right digging the left over a liberal-elite dominated group of educators, media, and lawyers, both claiming the other runs a shadow gov't is just people making noise and pointing fingers. The problem is rooted in a big national gov't, which is why a small federal gov't was originally outlined by the Constitution. The rest your legislators and judges made up from whole-cloth, and we now have exactly what we as a nation want, and exactly what we deserve.

Actually, the size of the federal government was NOT outlined in the Constitution, whereas the document it replaced, The Articles of Confederation explicitly had NO executive department that could expand onward and outward. Of course, the legislative had to provide the financing for the executive's expansion, which was actively instigated during T Roosevelt's and Taft's terms. Please see Kolko's The Triumph of Conservatism for details.

actually the constitution outlines a very strict, small set of responsibilities that the federal government has control over. The rest are both implicitly and explicitly (10th amendment) responsibilities of the states. The federal government is not just the executive, it is the executive, legislative and judicial branches. The legislative giving money to the executive is just re-allocations within the federal government.

You are correct though, there is no size limitations. The current size just seems insane when you look at what the federal government is actually strictly allowed to do based on the constitution and amendments. A lot of the departments (Department Of Education, for example) should probably have an amendment to allow them.

Please see Article 1, Section 8:

The Congress shall have power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties,...

To make Rules for the Government and Regulation of the land and naval Forces;...

To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.

Karlof, it's the "Powers vested by this Constitution" part that basically means that the Government can make laws based on the powers that the rest of the constitution gives it. If the General Welfare part meant they can make whatever law they want, why bother write the rest? I'm not saying that things like the Department of Education are completely barred from the federal government, I'm just saying that they have to actually AMEND the constitution when they want to expand the powers of the federal government. It's no big deal really, amendments were allowed because our founding fathers new that times change, and as such the constitution should change with them. You can always repeal an amendment (see 18 and 21)

Encinitas--Then you are what is known as a "Strict Constructionist" and would likely subscribe to the Anti-Federalsit POV. (I did get a degree in order, and was accredited to, teach this material and did.) The parts of the Constitution I bolded are just that: open to varying degrees of interpretation. An item I didn't post was the Commerce Clause: "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;" which is perhaps one of the most widely fought-over clauses. Banks were allowed to issue their own banknotes; yet, the Constitution says: "To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;" so, is printing a banknote the same as minting a coin? Lastly, since this is TOD, I should certainly point out where the authority lies for the construction of roads: "To establish Post Offices and Post Roads;" And I can go on for some time, and did in the classroom.

Next time you're in your local college library, see if it has a copy of The Complete Anti-Federalist or at least a copy of The Anti-Federalist: An Abridgment of the Complete Anti-Federalist. Another two very useful books that every home should have are The Ideological Origins of the American Revolution and The Radicalism of the American Revolution. Then of course there's that old standard The Federalist Papers.

Of course, all of this is related to those "soft degrees" that are condemned below as useless. So, knowing what our legal and sociocultural foundations are is probably just as useless.

yeah, guilty as charged. I even hinted at it a little above with the "... the constitution outlines a very strict, small set of responsibilities" part of my first comment =). I even go for the whole Bill of Rights was unnecessary and undesirable argument. From my short time here, you've been nothing but fun to talk to =).

As to the "Soft Degree" stuff, i definitely see the value in them. I wouldn't put much heed to people talking down about them. I tend to be a techie, and sometimes when you get used to measuring things in moles, bits, ohms, or microns, it's easy to lose sight of other less obvious systems of measurements like a well run society. Though kinesthesiology is still just a glorified PE class to me.

Trying to debate karloff about history is like trying to debate dezakin about nuclear power or leanan about the virtues of efficiency. You can make a lot of points, just expect them to be picked apart mercilessly :-)

I'm totally cool with that, in fact i enjoy it! It's all part of Hegelian dialectic: thesis, antithesis, synthesis, wash and repeat. I tend to be like that too in person, but my laziness gets the best of me at the keyboard.

Thanks phreephallin. It does show that I miss post-grad seminars;-) The generally high level of discourse is quite attractive, as is the daily opportunity to learn something new. Starting tommorrow, I'm off on a field-trip to observe the denezins of Northern California and the local fire damage around my sister's house. There's a guy called lurker down at the bottom of the thread with an interesting bio (click on his user name) looking for some engaging discourse. Ta!

No, Paleocon, tyranny can exist under small government, and thrive under it. If not for cheap coal and the Industrial Revolution we'd still be living under it ourselves. It's the tyranny of 4000 years of cheating, flogging, daughter-raping landlords that blighted our past more than anything else, choosing strong or weak kings as served their momentary interests. The American, Greek and Roman slaveowner, the El Salvadorian oligarch, the Chinese landlord, the Russian boyar, all of them oversaw misery in detail that was more durable than any Communist dictatorship, over people who were most of our ancestors and thus presumably were not animals or subhumans.

It's always a few unlucky farmers who must borrow money from a luckier one after a bad crop, and the cycle begins until the lords have log-rolled their advantage to control law, culture, religion, and the army. In ancient Greece, it ended in revolutions in countless city-states, many of which had to redistribute wealth and forgive debts just to start the cycle over again. We don't know how many people have been murdered or knowingly starved in all the normal operations of this system over the millenia, but I bet it doesn't compare badly with the death toll from Stalin and Mao. We Americans just consider it more "natural" for peasants to be butchered rather than entrepreneurs.

If we believe that collapse is coming, then there is nothing to prevent the return of this pervasive evil except the deterrence of revolution. We Americans justify capitalism by lauding technological improvements to the lives of those on the bottom, but The Oil Drum assumes that this will end without cheap energy. If we go back to 19th Century economics forever, then I damn well have to call for revolution forever, because the human race deserves to go extinct if such a despicable system is the best it will ever do.

A number of right-wingers at this site seem intent on excusing neo-feudalism in advance, and I imagine they wouldn't do it if they figured on ending up as one of the serfs.

To show the typical depravity to which a system of absolute property rights must descend (in only 180 years in this case), I quote from Mary Chesnutt, wife of a prominent slaveowning family and friend to Jefferson and Mrs. Davis.

"God forgive us, but ours is a monstrous system & wrong & iniquity. Perhaps the rest of the world is as bad. This is only what I see: like the patriarchs of old, our men live all in one house with their wives & their concubines, & the Mulattos one sees in every family exactly resemble the white children-& every lady tells you who is the father of all the Mulatto children in everybody's household, but those in her own, she seems to think drop from the clouds or pretends so to think-."

Is this the restored post-oil republic that some at this site cheer for?

Basically, I'll just put it out there:

all governments screws you, but so does no government.

You're damned all the way across the government spectrum. The size of the government doesn't seem to matter when screwing people. Pick your poison people (and your alliteration).

This is why some of the intentional communities have as part of their aims being a model for others. Many have a knee-jerk reaction to sharing and sharing alike, but it's what we learn at our momma's knees. How it becomes an evil as we grow up is beyond me.

Whether we like it or not, we have two choices: some form of BAU, or some (not-so-radical) radical change. With today's technology, for example (assuming honesty in implementation), there is no reason why America cannot become a direct democracy. Why do I need someone to go to Washington when I can and access all the info I need with, then vote from, my computer?

Community decision-making works best in small communities, so let's have small communities. Let's make the neighborhood the primary structure of society, not the federal government, not states, not even cities. As larger scale problems arise, address them at the larger level, but let's not START at the larger level for everything.

Make participation in civics mandatory. You don't participate, you don't get to vote. You don't vote, you don't get to use those things common to the society. Wanna go your own way? Go.



A point of clarification: What does BAU mean? (I'm new here >.>)

A recommendation: A page linked off the main page, maybe in the left column, that works as an appendix for all the TLAs (three letter acronyms).

I agree with the idea of direct election, but there needs to be a lot of work done to get the system security and accountability aspects of online voting up to the levels i'd be willing to trust. Just using my SSN on a SSL encrypted server will not do it for me.

BAU - 'Business as Usual'

Welcome in!


oh man, can't believe i didn't get that one, Thanks!

Thanks for having me =)

Reminds me of a recurring Political notion, that different forms of Gov't may be appropriate for different scales.. (Family, Town, District/State, Nation, World) with a clear limitations on what is controlled at what level.

I've looked at Intentional Communities with such bad experiences with poor leadership, that they wanted to build a system of no leadership.. have also served on Boards with 'Antidisestablishmentarians' who were so used to attacking systems that they would tend to sabotage any systems we had to create to get things done. .. So you say you want a Revolution?


i go for:

"Decentralized governmental power ought to be a fundamental goal of a democratic society"

- National Forensics League

It was a horrible debate topic, empirical evidence shows that there is some degree of decentralization in all democratic societies (not to mention it is a snoozefest). The cool part about it was that it made me think about the benefits of bringing parts of governments closer to the people. I'm not sure i care about a Revolution, but I've always wanted to get drunk and unload an AK into the air. They don't let you do that here in suburban California.

Speaking of Revolutions, i just realized what will be a scary breaking point for Peak Oil: if/when their is not enough power to keep up a reliable internet infrastructure. This will mobilize my notoriously passive generation, because they won't be able to blog their outrage. People over 30 will be first against the wall. That is if we will be able to organize without facebook or twitter...

I think the Constitution did a pretty good job of establishing those limitations, but we have allowed those in power to bend and twist it to their own ends. Notice I said allowed, not just "those in power bent it," which would imply we are little victims rather than citizens abdicating what the Constitution granted to us.

My contention is that we have abdicated our role as the Gatekeeper. We cannot blame the government without blaming ourselves. We are the government. The sheer size and complexity overwhelms people. They feel powerless because they think that action is inappropriate. We've been told to vote, and that is good enough. Demonstrations are for hippies, commies and the unpatriotic.

But imagine what a national strike could do. Imagine a sustained national strike, targeted to effect and with "the people" organized to take care of those whose access to food and such is limited by the strike and to protect participants from retribution after. Imagine simply saying, "No."

Of course, this could lead to massive confrontations between "sides", and fall into chaos. That's the risk. But that's why a long period of education, PSAs on TV would be best, would be needed.

This is all Pollyanna, though. We are just too damned big. There is too much inertia in the system. There are too many nooks and crannies and loopholes that those with the time, money and resources can manipulate or control. There are too many who do not know the Constitution and particularly don't understand that of all the things one could point to and say, "That's America", it is the one that most truly is. Yet, it's a "goddamned piece of paper." (How bush wasn't instantly pilloried and tried for treason for that statement alone, I will never know. It is a direct violation of his oath of office.) To too many, patriotism is the flag, yet the sum total of the great ideals embodied in the flag are: the number of states, white for purity, red for sacrifice. By getting Americans to buy into the flag rather than the Constitution, Americans are easily swayed because they then are not thinking about ideas, but about emotion. It's an instant brain kill switch.

As Jefferson said, revolution is not only good, but necessary when gov't wanders too far off the mark. The nature of the "revolution" is the key. A shooting revolution would be pointless as the problems are systemic and endemic. In the end, power would win out. But, "revolution" via voting is not working, either, because the institutions built up over time have corrupted that process, as Diebold can well attest. We need to "vote" with our dollars. That is, opt out of the system. Stop using them by ending the need to use them. End the need for the police forces by being strong communities. End the need for wars by being satisfied with the world we can create with our own hands. End the need for political parties by being Americans and neighbors first last and always.

As for building communities, there's a good video from Peak Moment on YouTube about what makes such communities work. According to them 90% of them fail. (Go figure.) It's almost a half hour, but worth watching for anyone seriously considering any kind of community that is more than just networking with friends and neighbors. What struck me was something that makes being human all too clear, and it essentially proved to me that human beings cannot create utopia on any meaningful scale. That is, we cannot avoid the cycles of growth and collapse, nor the uneven distribution of wealth, nor any of the other ills that come with being human and living in groups larger than clans: Every successful intentional community controls who can be in the community. We decry segregation for skin color, but it's OK if it's about philosophy, lifestyle, or just your social skills and ability to play nice? What's the difference? So, an intentional community is not a panacea. The lack of a need for them would be the greatest evidence we have evolved a bit.

The healthy, sustainable community that is more than the clan will accept anyone willing to work for his share of the community's product and not harm others in the living of their lives. That's about all the rules I think we can really manage and consider ourselves truly accepting of others. Of course, principles of sustainability are absolutely necessary.

Ultimately, I think the best way to manage civil life is to leave things to the people. Major decisions are full group. Lesser maybe by committees, but subject to the full group's veto. If there are infractions, face your peers. You don't need laws. We all know right and wrong. Let the group decide. And, sadly, excommunication/banishment might have to be one of the choices the group makes.

Sorry, this is rambling. My thoughts are not complete and this post cannot be anything near exhaustive.


What we need is a nude love-in.

LOL - Well, a clothed love in would be pretty boring after a while, wouldn't it?

Here's Peak Moment Video: http://www.youtube.com/watch?v=IXVLNUHqjeA


Funny the word tyranny. It derives from the word tyrant. The tyrant was the powerful/brave/? individual who put an end to the gross inequites that cyclically arose in the Greek citi-states. It was thus for a long time an honorable title and probably the first victim of spin.

Best form of governmnet? I favor the communitarian roughly equalitarian village/regional democracy; and I must say I admire the sociocultural system of the Trobriand Islanders. As I've said before, unless we learn to be cooperative instead of competitive, to share instead of covet, there's not much hope for humanity becoming civilized.

Big gov't saps your wealth. Powerful gov't takes your freedom. A ruling society class is just another form of oppressive gov't. The US experiment isn't perfect, but it has done better than any before.

How is the recent sexual revolution better for women, though? "Empowered" women today have kids they can't afford with loser guys with little but attitude then expecting society to raise them is better how? Powerful men always sleep with women for the same reason poor guys do -- because they can.

Humanity has superb aspects and despicable facets. Stress brings both to the surface. But for America overall the better tends to win out; hopefully that will be true this time as well. I don't assume societal guilt, I don't advocate despair, and I'm not so naive to expect people to change. I do expect some to survive, though.

Today each of us is a plantation lord with slaves of oil, and we are facing emancipation. We'll see how the sharecropper shacks look after the big house. You can do worse than 40 acres and a mule though. 19th century economics doesn't mean 19th century mores and technology. We could do better or worse than before, but mostly I bet simply differently.

How is the recent sexual revolution better for women, though? "Empowered" women today have kids they can't afford with loser guys with little but attitude then expecting society to raise them is better how?

I thought racking up an unsustainable amount of debt was the American Dream. What's more of a debtmonger than a kid you can't afford?! Are you trying to deny women their fast track to the American dream?! I bet you don't even have two mortgages! You sir, are Un-American.

I have too many mortgages, but not more than one per house. I do have several adopted kids, too, so I've got most the "dream" well-covered! And more debt than I should, but I'm getting better fast. :)

May the world shower you with valuable carbon credits for having adopted!

Example: I send my quarterly retail sales tax form to a private company in Arizona. Hello! I am in business in Nevada.

Thanks for the link great counter to the Kleinheads. Its amazing what tries to pass for intellectual discourse these days.

And yet all you offer is an insult. Personally I have not read the book and simply skimmed the The New Republic editorial. Speaking for the editorial, the writer could have cut out the biography on Ms Klein and dealt with the matter of the book. But, no, it appears that it is not enough to disagree with an argument, the arguer is also fair game. Thats not "Discourse" - its something else.

Well, I wasn't going to read it, but if you don't like it, it must be good. Thanks for the recommendation!

I bought Shock Doctrine, because I was reading references to it here on TOD.
I totally agree with the review. I could hardly read the book it was so full of conjecture and personal opinion.
Just more conspiracy garbage IMO.
I thought I was the only one who thought it poor reading.

It's not just the Neocons who are from Chicago; the neoliberals are too. Thus I coined the term neoliberalcons several years ago as they're both from the same side of the same coin. The continuum of policy direction since Reagan/Bush provides my proof.

Excellent read.....will explain alot to those who
want clarity.
When Amy Goodman on FSTV (Free Speech TV) highlighted
the book I bought and read it........actually I donated
money to FSTV and they sent the book for the donation.

Ignorant...Nothing in the US Economy is 'turning around'. In fact, all sectors are in a steepening decline.

The anticipated bear market bounce in Financials has led to the usual fools' chorus that the worst is behind us, the economy is on the mend, and a recession is avoided. If their song sounds familiar, it is because you heard the same tune with the home builders, and the same melody with the monoduoline insurers.

For those with their head in the sand, here is a broad and varied look at where the economy is contracting. Note that this isn't a cherry picked list of negatives -- it is the crème de la crème of corporate America, ranging from consumer to finance to industrial to transports, and includes such stellar names as Apple, Toyota, American Express, UPS, Catepillar, Costco and JPMorgan. (There's not a slouch in the bunch!'...snip...

'How's the economy doing? You tell me:'...See rest of article at link below...



I don't see improvement, but that wasn't my point.

Over at Shadow Govt Statistics the pre-Clinton CPI is running at over 8%. That means that the GDP is over stated by at least 4%. This does mean that the economy is in negative terriory OVERALL. There are some plays out there like rail roads, energy production, mineral production, and more besides, that could be good pickups if there is a move down.

Keep your powder dry - I do think that all the rest of us should be avoiding costly capital projects unless the payback is good.

SGS is excellent. CPI and unemployment are both at about 12% today when using the same formulas as the 1970's.

Personally I'm currently in the deflation camp, expecting falling stock prices and commodity prices. Although I expect commodity prices to hold up better, and recently commodities have fallen so far so fast I have no idea what is coming next. (I'm not expecting a further breakdown in prices immediately, but are trying to be in a position to take advantage of it if it begins).

Having said that, with the stock market crash will come even higher levels of unemployment, and lower standards of living. So there will be huge pressure on the politicians to do something. I think most people nowadays (including myself) have little experience with, and few skills to cope with hard times. So demands for a silver bullet solution, some kind of new New Deal will be overwhelming. Higher gas prices (at least as a percentage of discretionary income) will only exacerbate this.

That could lead to massive govt spending and as SGS predicts hyperinflation.

When? I don't know, I just don't know.

TripHop, ICBW, I am looking for a Dow around 7,000 or lower and am out of stocks.

Hyperinflation might happen for a very short period but I doubt it. HI would mean no foreign flow of funds into the US and an almost immediate default on US Gov debt. Checkmate scenario.

The Fed will, at some point, realize that all of their schemes, especially low interest rates compared to the real rate of rising prices (inflation), is never going to accomplish reflation of the housing bubble. In fact, real rates of home mortgage interest are rising even with the low Fed funds rate. See any commercial paper spreads vs treasuries for confirmation or call up your local banker about a RE loan for confirmation.

What happened today in financials is exactly what I predicted would happen a couple of days ago. The bulls realized that the fundamentals in financials have not changed and gains in financial stocks reversed on a sell off. Now we could see another bump up in crude and other commodities because the slosh money ran scared from financials and it has to go somewhere. With few good choices in stocks, commodities look pretty good. This stuff is not rocket science although 'investment advisers' would have you think otherwise.

The last move the Fed has is to increase interest rates to protect the dollar and offer higher yield rates on Gov bonds. Of course this move will crush the housing sector, the autos, credit cards, employment and financials. Thus the Fed is reluctant to make the move. In the end game they will have no choice. It will be ugly.

since you seem much wiser than me, i have two sets of questions for you:

A) 7,000!!! Ok, that's not a question. I'm not doubting you, it's just, well, we have a long way to go still.

B) Wouldn't crushing housing, employment, etc. be pretty hard on the dollar as well? I mean you basically described all of the underlying institutions of our current economy being crush. I mean, if Housing, credit cards, and employment are screwed, so is the consumer. No consumer=economy. The dollar is fiat money, which I understand to mean it's only as good as people think it is. If the basis of our economy, the consumer, is screwed, why would anybody think that the dollar is a good investment? Is it just to prop us up so we can pay them back all our debts?

IMO the Fed raising interest rates should save the dollar, but yes it will hurt the economy. You are right there are two opposing forces at work, but if the Fed raises interest rates enough (more than the ECB say) it should work to save the dollar. Or at least the dollar should tank less quickly than the Euro. They are all going down against commodities.

As I said I'm currently in the deflation camp. 7,000 dow sounds believable to me. I have been shorting stocks since s&p at 1400, mainly using s&p500 futures but covered between 1215-1220. (See my previous comments or on seekingalpha). Looking for an opportunity to go short again.

I own some commodities as long term investments (mainly physical precious metals), but have a hard time seeing how commodities will soar while the stock market is crashing.

Instead I see commodities consolidating for awhile (18-24 months say), during the stock market crash as demand destruction takes place. But demand for, say, crude oil, is pretty inelastic and asia and opec are still using more each year, so unless a realistic alternative to fossil fuels can be found quickly (in 5 years say) then I see the price skyrocketing higher as physical supply shortages begin to occur.

At the same time this is occurring unemployment and interest rates could be extremely high, and rising fast. (You yourself said the Fed will be forced to raise interest rates, and it will be ugly). The outcry for politicians to do something could be overwhelming. But the politicians can only make things worse, all they can do is print money, for new New Deal programs, stealing from dollar savers, and causing inflation. Even hyperinflation, that's the danger the do-gooder politicans.

Oil/Gold down heavily as I type this (oil 127-124 in one hour), and simultaneously stocks falling (s&p500 actually down 1260-1252) as I type this.

Encinitas: Yes crashing stock market will be bad for employment and house prices. Access to credit may be greatly reduced or cut completely. No credit card loans, auto loans or even home loans. Imagine how low house prices will go if people can only buy with cash!

But this won't happen in a day, it will take time, years.

The big boys are scared and the markets eat sissies.
It isnt the mom and pop investors causing this froth.
The small potatos and retail investors cant cause this.
Most individuals arent on E-Trade.
The little unwashed drones use Fidelity and Vangaurd
and such...since their trades of stocks and ETF's
sometimes take 3 days to settle and another to post...
or they get a "Breach of good faith violation" call if
they trade to fast.
Its the big unwieldy hedge funds and super funds that
are causing this sawtooth rollercoaster ride.

Little people like the barber or butcher or baker cant
rotate in volumes the markets are seeing right now.

The talking heads on CNBC and MSNBC cant even keep
their stories straight lately.
They stutter and lisp, wriggle and squirm and make
grimacing faces and roll their eyes.

Ive actually seen fear in their eyes and heard their
nervous laughter.

They know its P.O. ...dont kid yourselves

I saw the American markets tanking today so why
someone was singing "Happy days are here again the skies above are clear again" I cant understand.
I have a longer memory then a year ago also and recall
several years ago (pre Bush) when all resturants every
where were jammed with a line out the door.
The paper place setting was even a job application.

Ive been singing "I made a railroad..I made it run...
I made it race agaisnt time.....now its all done..
Hey Buddy can you spare a Dime"

Congress has provided a transfusion into the highway trust fund because gas taxes can't keep up with lower VMT. Besides the fact that this shifts the costs to everyone from auto drivers, I find it depressing that congress can find $6 billion for highways but not a pittance for renewable energy.

Around here, they seem to be doing more patching and less total resurfacing. I would presume this is due to increased asphalt costs. The locals don't have the option of unlimited deficit financing like congress does so must just make do. Any increase in taxes requires direct approval by the people.

We should either pay as we go with higher gas taxes or cut back on highway construction and maintenance. In addition, we should ensure that truckers pay for the full damage they do to the highway.

Long term priority should be that we begin to shift funding from interstate highways to interstate trains. But that would required that we actually set priorities.

Not to worry though because just the threat to "drill, drill, drill" in the words of Larry Kudlow has and will bring down oil and gas prices.

I wanted to watch CNBC this morning but Kudlow is one of the anchors . I can't stand to watch that man more than about 30 seconds.

"In addition, we should ensure that truckers pay for the full damage they do to the highway."

But don't forget, 'If you bought it, a truck brought it.' We all pay for this, either way you figure it..

When you point your finger cos your plan fell through, You got three more fingers pointing back at you..

Dire Straits 'Solid Rock'

Yes, but the truckers should pay the full costs so that the transport system chosen to move the goods will reflect the true costs of that system. In addition, paying the full costs of transportation would tend to favor greater use of more localized goods. Subsidies that encourage energy intensive methods of moving goods around should not be permitted. That is what is being done by giving truckers a break.


Subsidizing trucking hides the true cost by removing it from that direct supply chain and spreading it across all taxpayers generally. If the cost of trucking were considered without subsidies, very few businesses would choose trucking as the primary route for shipping goods other than very locally. Truckers may not like this but it's the truth and in a world where our available hydrocarbon resources are not growing as fast as demand (and might begin to shrink any year now), we can no longer afford such energy expensive experiments.

Believe me, I don't think trucking should (have been) subsidized, via highway policy, etc.. but at this point, we're facing triage, we're not designing the system from scratch.

How do we wean ourselves off of truck transport, while rebuilding our systems with parts that will in so many cases arrive by truck. It's just another aspect of 'using remaining Oil supplies to help us get ourselves OFF of it'.

We start by getting the prices right, by harnessing the considerable power of simple honest billing.

As long as the transportation sector continues to receive gargantuan subsidies, there is no incentive for any "weaning" to occur. Yes, 'if I bought it, it came on a truck', but that really only needs to be the last few miles. So part of the adjustment needs to be, 'if it came the whole way on a truck, I need to pay more, starting now, because there's no better time.' There are plenty of non-saturated rail lines, and plenty of opportunities to restore single track back double track.

There are also logistical opportunities. A good many markets still operate on the principle that 'to protect superfluous parasitical middlemen, it has to be be shipped back and forth across the country five times before it gets to me.' OK, I exaggerate, but in those markets, there are plenty of opportunities to reduce the number of greedy, grasping hands involved in the process of getting it from port or factory to me, and, in the process, to reduce the number of times that it is shipped hither and yon along the way.

And in some markets, there are opportunities to rearrange production to take place closer to the final consumer. In recent years, the massive subsidies have helped mightily to drive a huge trend in the opposite direction, but that's not irreversible.

The sooner we get the prices right, the sooner opportunities to reduce freight transportation, improve logistics, and optimize production location will be taken, and the sooner we will be better off for it. It would remain so even if oil dropped back down to the infamous $38, so it's one of the few truly no-regrets options around.

One cannot get the price right until the horizon is right. It's fairly easy to get the price right on an ear of corn from your own garden - one only has to worry about fertilizer and soil amendments from away. And the intellectual property ownership of pollen and the various species of bees. But what is the right price on an ear from the other side of the continent? You don't know the inputs, the transportation costs, the food industry infrastructure - let alone GMO and public health issues.

Price alone will almost always be wrong as a mechanism for improving society, because the incentive to reduce price will almost always end up in some sort of unsustainable exploitation elsewhere - over the horizon. One can't start and end with price. Scale, efficiency and allocation all have to be considered.

This past spring I ordered a 25# bag of organic black beans from my food coop. What I got - for less than $25 - came from China. How does one set the price right? First one sets the horizon.

cfm in Gray, ME

This is the problem with the "every silver BB is good" theory. Resources aren't infinite, and funding one means not funding something else.

You look at that table:

If we as a nation really believed in peak oil, that funding allocation might be quite different.

I have pointed out before that we cannot "crash everything"# Priorities need to be set.

IMO, for example, EVs should be left to market forces, solar PV should get less emphasis than wind (unless technology changes) etc. Corn based ethanol should be forgotten about (except for purposes of intoxication, which does aid forgetting).

# As in a crash program to do xyz, doomers certainly agree that we CAN "crash everything" :-(


The primary problem is unlimited deficit spending, a congress, people, and president who are all out of control.

Another problem with doing everything was exemplified by the crash program in Denver to spend billions on both widened highways and mass transit largely paralleling that highway. It was great to get more light rail but why should we simultaneously make it easier to use the auto. Easing congestion just gives people less incentive to use light rail when the destination is the same. Of course we are back to congestion, anyway, since this is a problem that never gets solved in a large, growing city.

And now the current light rail plans are in jeopardy because of increased costs. Sure would have been nice to have some of that highway money they pissed away on I25 expansions.

Why should solar get less emphasis than wind?

Two different technologies, two different manufacturing streams, two different applications in terms of scale - very little overlap, at least in Germany.

After all, you need to keep employment up, and any industry which is energy positive will be self-sustaining, in one basic sense.

Why should solar get less emphasis than wind?

Because I and my buddies can build a 1Kw windmill in a couple of days for from $300 to $1,000 bucks, but cannot build a solar cell at all.


You make an excellent point. Smart people like yourself don't need incentives and stupid people won't ever be able to calculate the return anyway.

Looks like you'll have a job when it's all over.

Nice work.

Of course, there's Solar and there's Solar. A lot of people could be building simple solar heating devices, or manufacturing and selling them with generally local materials..

Sorry again I couldn't help more with your design. I'd love to, but I'm way overstretched.. Don't give up on it.


You manufactured the copper wire in the generator windings and the ball bearings for the windmill yourself? Call me impressed.

Or to put it a bit differently, to the extent we are talking about new as compared to scavenged or repurposed, very little of anything that would be considered an industrial product can be manufactured at a handicraft level.

And the wind turbines under discussion are in the MW range - and they are as easily as high tech as solar panels.

Yes, new and scavenged. The design we built (they, really) uses junked automotive bearings, builds much of the rest from stuff around locally, but needs power tools and they bought the wire. Of course, most of the stuff can be done without power tools, but much more slowly.

There's no perfect solution, right? But I think the locally built 1kw windmill is far more sustainable than the wind farm, and keeps my thousands of dollars in my pocket. A hand-built, passive solar home with no mortgage, a windmill, some bio-gas from a digester and a cheaply made (buy the cells on E-bay?) solar system (bottles, cans...) would pretty much get me off the grid, away from the government's prying and taxing and allow me to tell said government to go suck an egg.

The Grid = BAU.


Interesting perspective, and I certainly believe that scavenging from what surrounds us in abundance is a completely valid way to keep things sustainable.

Where I differ, as noted by another poster, is in such areas as the durability between a solar panel that works for decades. You will be scavenging multiple times over that same span of decades to keep that windmill going, and at some point, there won't be much to scavenge any longer.

The other point I differ, very deeply, is the idea that we all can live in splendid isolation if we just work hard enough at cutting ourselves us from society.

But this is a very broad discussion, one that in the end is all gray, without black or white.

I will point out, however, that reading about the history of manufacturing of wire could be interesting - we take wiring for granted and assume it is a trivial thing, but it is far from simple to actually create, especially in terms of wiring used for electricity. Jewelry is another subject, of course.

Where I differ, as noted by another poster, is in such areas as the durability between a solar panel that works for decades.

Solar power hasn't been widely used for 30 years yet, so I'll wait a bit longer to accept your characterization, but I have no real opinion. I think solar is fine. But here's the problem: if you can't afford it, then it's not sustainable for you.

This gets forgotten a lot in these discussions: who is it affordable for? A few hundred million out of 6.6 billion? And, what resource constraints do we hit trying to build 1 billion solar arrays for 1 billion homes?

The other point I differ, very deeply, is the idea that we all can live in splendid isolation if we just work hard enough at cutting ourselves us from society.

I didn't say anything about society, I said government.

There are tons of things I want to read about. Time is my enemy.


Solar power hasn't been widely used for 30 years yet,

Solar power is the reason we are here. ITs why we have oil, coal, gas.

Man's been using solar power in adobe construction.

This gets forgotten a lot in these discussions: who is it affordable for? A few hundred million out of 6.6 billion?

Even one panel at 150 watts does the wattage labor of one man. A small panel can power a radio or a light to drive away the dark.

(and yea, 6.6 is a whole lot. But hey, if 'power from space' boy is right that's solvable just by putting stuff in space, right?)

Even one panel at 150 watts does the wattage labor of one man. A small panel can power a radio or a light to drive away the dark.

This is a salient point. It is essentially the underpinning of my policy suggestion, but it still needs to be affordable, available and requires a paradigm shift to living sustainably. That is, we must be satisfied with less bling and more real action and interaction.


I agree. My system produces 5.3 million watts a year for three years now. I'm not interested in a mechanical system that requires maintenance. And I sure don't want a 100 foot tower on my roof.

Wind is way over rated. Solar is easily distributed across the grid. Meanwhile, Pickens in begging Congress for Billions to run more tranmission lines.

Equal incentives per watt and let the user decide which is best, or no incentives. The latter suits me just fine. Prices will be high enough, soon enough.

Really, this either/or mentality has got to go. It's wasting time and energy on an unnecessary and unproductive discussion. Many have made the point, and let me repeat it: no one solution fits all conditions, fits all budgets, etc. I intend to use multiple solutions due to the four season climate I am now in, if build here. I really have no choice.

The equalizer for ALL systems will be storage. When storage is cheap, easy and efficient, it won't matter so much which system one uses. But I'll hopefully be starting with a passive solar home which will help keep energy needs down considerably. That's the best first step many can make, a highly efficient home.


I believe you meant to say that resources are "finite".

Um...I did.

The point about jobs being on the line is errant as well. If pushing national debt out to industry via a road project is a good thing economically, not taking it at all (cutting taxes) would be better.

In any case, shifting subsidies to alt energy is getting ahead of the game, whereas shifting more money to highways is doubling up on an already losing hand. I'd rather double up behind Picken's, personally (the wind part -- the gas part can sort itself out via market forces).

I don't expect Congress or people to give up on roads entirely, but I do think that shifting to a user-pays model for cars and trucks would be fine. You'd need a lot less maintenance once the trucks moved to rail. If you wanted to be nice, you could stair-step the fees over 10 years, but really some short abrupt pain would help shift momentum quickly.

Which is why a lot of investors, including Warren Buffett, are becoming fixated on railroads, at least in part as a peak oil move. The rails have been a bright spot in this year's dismal market. They may not be strong believers in peak theory, but investors are realizing the vast transport efficiency advantages of rail - much less fuel used per item.
Trains get 80% more mileage from a gallon of diesel than they did in 1980, when they began an upgrading process. The EPA now estimates that for distances over 1000 miles, trains use 65% less fuel than trucks to transport the same cargo. Electric rail would be a whole 'nother ballgame.

As I see it, the current system of funding the maintainence of road systems could become trapped in a vicious circle. Lower VMT results in lower revenue from fuel taxes. To increase revenue, fuel taxes must be raised, further reducing VMT. People will also become more resistant to paying taxes for a road system which they are increasingly unable to afford to use.

Of course, less traffic on the roads should reduce maintainance needs but probably not by enough to counteract the loss of tax revenue, as it's not only damage from vehicles but also from the elements, which needs to be repaired.

I suspect popular routes will be given priority with government funding or may become subject to tolls. More minor roads could fall into disrepair unless local people are able to invest in their upkeep. Remoter areas could become more and more isolated as the transport links which service them degrade.

And then there's the investment needed in the new infrastructure required for constant economic growth...

Of course, less traffic on the roads should reduce maintainance needs but probably not by enough to counteract the loss of tax revenue, as it's not only damage from vehicles but also from the elements, which needs to be repaired.

Yes, freeze-thaw cycles never stop. Less truck traffic will make a difference though. For modern roads in good repair, it almost doesn't matter how many cars travel on them they are so (comparatively) light.

Makes me wonder how the Romans paid for road maintenance. Or maybe how they couldn't, at the end.

The roads would be easily paid, if the money weren't spent by large-living plutocrats and spent on palliatives for the masses.

As with oil, slaves and plunder from far-off lands really help a nation's lifestyle until the slaves revolt and the plundering reverses direction.

In America's case, aren't the roads the ultimate palliative for the masses?

I think TV.

And Internet blogs. :)

I find it depressing that congress can find $6 billion for highways but not a pittance for renewable energy

I find it a lot more depressing that Congress can come up with close to $1 trillion in military spending to fund the eternal war against brown people and only a pittance for things that actually make things better in America (or the rest of the world, for that matter).

800 miles of toll lanes on Highway 101, other Bay Area freeways proposed

A Bay Area transportation commission is proposing the creation of a $3.7 billion, 800-mile-long network of mixed-use carpool and toll lanes on more than 12 freeways in a big new attempt to ease chronic traffic congestion.


What an incredible waste of money. Traffic congestion will ease due to high gas prices.

I suspect a new revenue stream off the CA state books is the real incentive here?

I was living in San Francisco when I discovered LATOC and TOD. My apt. had a great view of the city and the bay. What immediately struck me was the folly of the continued building of the new bridge that will replace the one from Oakland to Treasure Island... billions of dollars for an infrastructure that soon will not have the tax base to support its on-going building and maintenance. At some point (two years ago?) work stopped because it was overbudget. Go figure.

Since 2004, Saudi oil consumption has increased nearly 23 percent, to 2.3 million barrels a day last year. Jeffrey Brown, a Dallas-based petroleum geologist who studies net export numbers, said that at its current growth rate, Saudi Arabia could consume 4.6 million barrels a day by 2020

atta boy westexas, got another plug in their today!

keep spreading the good (or bad?) word

From the Saudi diesel story linked uptop:

Farmers of the Al-Jouf region have threatened to sue Saudi Aramco for curtailing the diesel supplies to the Kingdom.

One of the things I have wondered about is if Saudi Aramco is curtailing domestic refinery runs, in order to boost crude oil exports. This would presumably be offset by increasing product imports (which aren't widely reported in the short run), but they may be having trouble getting enough diesel in a tight market.

Or is it that they have a split local oil market along the lines of different production costs in different fields. Maybe Shaybah is so expensive its only worth exporting at world market prices?

Sem Group loses Bets on Oil, Files for bankruptcy

The collapse this week of SemGroup LP, a little known private oil-marketing firm, may have played a role in crude oil's 14% drop over the past 10 days.

The Tulsa, Okla., company filed for Chapter 11 bankruptcy protection Tuesday, citing among other financial woes a loss of at least $2.4 billion in crude-oil futures. Changes in its hedging strategies coincided with big moves in oil recently.

Good job of scooping my post Nate. I like the way you folks manipulate the time stamps on posts. Hey, I don't mind doing your job and I don't mind not getting credit...It's the news that counts.

pls tell me you're kidding...manipulate time stamp??? dude i have better things to do - just threw that up here - story doesnt even make sense tho people are saying that them covering their shorts are what caused the spike to $140+ then there was no bid after they closed down...

Doomers are known for their paranoia, right? :)

I think he is. Besides which, it was posted in yesterday's DrumBeat, and the day before, too. :)

The sky truly is falling...But sometimes the biddies don't hear Chicken Little...They continue to chirp, scratch, and find a few worms...all the while gossiping about the mundane. Meanwhile Chicken Little watches and attempts to understand if the Oil Sky is falling or the Economic Sky is falling...Or both. Chirp, chirp, chirp. :)

Sounds like somebody better have a talk with a "real psychologist".

Or could that be the problem?

Nate...All I can tell you is that your post did not appear on my hs access computer screen when I posted the story. Then I refreshed the page at least two times over a period of 20 minutes to check for new posts. Voila! suddenly your post on the same subject appeared directly above mine and with an earlier time stamp than mine. I am not kidding. Otho, like I said, I don't care. It is the story that is important, or, might be...and, I certainly didn't write the story.

If you aren't logged in, you see an outdated version of TOD. I'm not sure what the lag is now, but last time I checked, it was about 30 minutes.

I noticed because I sometimes view the site in IE as well as Firefox, just to make sure formatting, etc., looks okay in both browsers. I'm usually not logged in when I use IE, and often find to my surprise that the DrumBeat I just posted isn't there. Log in, it appears. Log out, it's gone.

I am always logged in when I pull up TOD from my favorites oil list. I rarely have to log in to begin posting and today I did not. You are welcome to try again...and, why would I be paranoid about such an occurance? Your logic isn't.

Just offering a possible explanation. I did not accuse you of being paranoid. Honestly, I thought you were kidding.

Many people use more than one computer/browser, or use something like CookieSwap to manage multiple users on a single computer. And TOD has been known to log people out automatically without their noticing.

If that's not the cause, I have no clue what went wrong. It's not possible for us to change the time stamps or anything like that. And I saw Nate's post appear before yours.

Out of morbid curiosity, since youre not kidding, pls explain why I, who am on conference calls half the day, am writing 3 papers to finish my thesis, trading stocks, harvesting my garlic and potatoes, preparing a speech for local school, reading about 100 emails, would give a rats ass about changing the time stamp on a freakin story that someone sent me? So I look smart????

I looked in drumbeat and didnt see it so i posted it - (I should have known Leanan had already posted it prior - she always does - but it was first I'd seen story).

My god - theoildrum is definitely a microcosm for post peak IMO. Tribal interaction at its finest. Our biggest problems can definitely not be measured in joules or BTUs....

Perhaps it was a strange coincidence but place yourself in my shoes for a moment. Considering what I have said I suspect you would be just a little curious about the timing of the posts.

Only you can answer the questions that you posed. I have no doubt that you are a very busy person. We all are. I didn't see the story in DB either, otherwise I would not have posted it. I doubt you or Leanan can find an incidence where I have posted an article that was already posted. If I am in doubt about whether an article has been posted I will start my post with a disclaimer, ie, 'Sorry if this has already been posted.'

Anyway, as you pointed out we have bigger fish to fry.

Peace, River.

Leanan - are we able to change time stamps?

IIRC, we can change the time stamps, but it doesn't change the order of the posts. So if you had actually posted after River and used your admin powers to put a later stamp on his post, the time stamp on yours might have been earlier, but his would have still been above yours in the thread.

Do NOT feed the trolls. Please concentrate your much appreciated input on those posts that matter :)


I feel its always hard to get a balance. When I post, I try very hard to be extra polite, even if the other person is saying "anybody who believes other than me is an idiot" or whatever. I don't know everything, in fact, I know very little really and that's why I come here to learn things and attempt to apply my learnings in the real world--and hopefully make my world a better place and maybe some others.

When I have a discussion with another poster I try and keep my humility and assume I might be wrong and they might be right and they might give me a real opportunity to learn something. I also sometimes try to throw out a possible theory in contradiction even if I agree with the poster in an attempt to flesh out understanding.

Of course, I confidently state my position with the caveat that my actual true personal knowledge of the matters discussed is limited, otherwise in my opinion I would damage my credibility by stating to truly know more about something than I do.

The back and forth discussion/argument, however, is what makes blogs so valuable in my opinion in contrast to TV or the like where material is just spewed out.

Cross-examination is the engine of the truth. Skepticism is the basis of science--only when something holds up to be true no matter how hard you try and show it to be otherwise can its veracity be claimed.

Crazy ideas are essential to understanding--peak oilers were considered to be in the same club as alien body snatchers only a couple of years ago as Khebab noted. Let the crazy ideas keep coming in, and keep smacking them down, and if they still stand then we know they are good.

But people need to be polite.

River, Drupal (the system the Oil Drum uses) also has caching, which may have played a role in this. Even with the cache setting turned off, Drupal still does a bit of it (depending on which version they are using).

From wikipedia:

A cache is a temporary storage area where frequently accessed data can be stored for rapid access. Once the data is stored in the cache, future use can be made by accessing the cached copy rather than re-fetching or recomputing the original data, so that the average access time is shorter.

The downside to using a cache is that the data is not guaranteed to be the most current.

As you can see, there are several technical explanations that can explain what you experienced that have nothing to do with people manipulating the system.


The downside to using a cache is that the data is not guaranteed to be the most current.

That is correct. And I may add that usually you need some knowledge to alter a time stamp. I guess its part of a database record, possibly as a UNIX time stamp (a ten-digit number). You don't have to be an IT professional to change such a value, but the normal computer user would not easily know where to go.

Real IT professionals use a signed 32-bit integer that represents the seconds since January 1, 1970, and waits for Y2k version 2.0 to occur on January 19, 2038.

< /tongue-in-cheek >


Also you do not know how many copies of Squid you are going thru, most ISP's would run a squid server. Squid is a web cache, The reason logging in would flush the cache is it would change part of your request (most likely the oil drum sessionid cookie value) which would invalidate any caching, simply being logged in doesn't.

Sorry to rain on your paranoid parade but the most like explanation for any inconsistencies you see are your ISP (and your web client for that matter) trying to save bandwidth


From the FT...Notice the dateline and time:

'Oil trading company files for bankruptcy
By Javier Blas in London

Published: July 23 2008 01:17'


If this story appeared in Tuesday's DB it appeared prior to the FT posting it. Perhaps you found it at another source? In any case I did not see the story untill I posted it...but I do not spend all of every day on TOD. I found the story at Naked Capitalisim this morning and it was not there last evening when I returned from a gala affair at the Iron Horse. :)

Yes, it was from different sources. I try not to use FT.com because of their paywall.

Actually, it was Monday and Tuesday I posted the story. Monday the rumor, Tuesday the confirmation. Search on Semgroup and it should come up.

I dressed down Airdale for being a public egomanic about 'but I posted it 1st'.

Consider this your dressing down.

...And now for some dissenting opinion. Or, are dissenting opinions welcome here? Well, perhaps they will make for spirited debate. Check it out cheerleaders!

On a slightly different note: Has anyone followed up on the LEH (Lehman Bros) suspension in commodities (or, was it just oil?)trading? If I remember correctly within a few hours of the announced suspension oil prices began to trend down and have stayed on that trend. Meanwhile, the LEH story has fallen off the radar.

' James Bianco, a respected fixed income analyst at Arbor Research, was so kind as to pass along his observations about the retreat in oil prices from his morning research note. "Is This Why Crude Oil Is Getting Slammed?":

The Financial Times - Oil trading company files for bankruptcy Access

...snip...'Oil traders said SemGroup could have exacerbated the spike in oil prices this month, when the market experienced unprecedented swings of more than $10 a barrel, as the company was buying back some previous bets on lower prices. The bankruptcy of SemGroup, which describes itself as the fourteenth largest US private held company, affects approximately $3.1bn of debt, according to court filings. Oil company BP is the largest creditor, with almost $160m.'...snip...

Reuters - Huge oil trading loss sinks energy trader SemGroup

'SemGroup took a $2.4 billion loss on July 16 after it transferred its New York Mercantile Exchange oil futures trading account to Barclays Plc, converting what they called "loss contingencies" into an actual loss. Included in the NYMEX loss was $290 million owed to SemGroup by a trading company owned by co-founder and former chief executive Thomas Kivisto, who was placed on administrative leave on July 17. Securities legislation limits publicly traded company executives from extensive dealings with their firms, but experts said privately held companies have more flexibility.'...snip...

'Comment - This story reminds us of the May 2006 parabolic rally and collapse in copper. Back then it was the short position held by China and Dwight Anderson's Ospraie Management that was forced to cover and when they did, copper prices collapsed.'

Quack, quack, quack...


A week or so ago, my wife got bit by a spider, and the bite got infected. Just about the same time, oil prices started trending down.

Cause and effect, River. Show me the cause and effect.

In the past few weeks, Mexican production has actually gone up, at the same time that Saudi Arabia not only restored the 100,000 bbl/day they had cut in the 2nd quarter, but increased production above that level. In addition, the imminent war with Iran seems to be on hold, and the dollar is on a multi-week rally.

All of those things are known to directly affect oil prices. If you get hit in the head with a hammer, you really don't need to dig around to find the cause of the knot on your head.

BTW, when you're forced to cover shorts, the price goes up, not down.

Shargash, I am asking questions. You guys are the experts, not me. I posed a simple question and what do I get? Analogies of spiders and hammers. BTW, sorry to hear of your wife's spider bite.

I am more interested in what the LEH suspension had to do with falling crude prices, if indeed it did.

Any experts out there willing to take a shot at this one?

He just told you: probably nothing.

Let me introduce you to the phrase "Lag Time". There is a lag time in just about everything. For instance there is a lag of about four weeks between the longest day of the year and the hottest days of the year. Ditto for the shortest day and the coldest days of the year.

There is a lag time between high oil prices and demand destruction. I suspect this lag time is on the order of six months or greater. Actually I think it would be spread out over a period of from a few weeks to over a year. At any rate, we are seeing demand destruction start to have a very serious effect on oil prices. I would not be surprised if prices dropped even further before demand finally overtakes the falling oil prices.

From there on out it depends on what the supply of oil does. If it continues to drop, or net oil exports continue to drop, then the price will head back up and continue its up and down swings with a gradual trend upward. But as I have said many times in the past, in the long run supply and demand are the sole arbitrators to the price of oil. However panic buying and selling will continue to cause swings in the price of oil with some of these swings lasting several days.

There is not a bubble and speculators are not driving the price of oil up any more than they are driving it down. They may be responsible for short term swings but nothing more. Congress going after speculators is nothing more than a witch hunt.

If there is a long term collapse of oil prices, back to under $100, then it will be caused by demand destruction, which in turn will cause/is causing a world recession. This is totally different from any price collapse in the past such as the past collapses in copper, silver, or anything else.

One more point must be mentioned. The dramatic rise in oil prices in the early 80's was caused by OPEC nations cutting production. They actually cut production by almost half, from over 31 million barrels per day to 16.7 million barrels per day. Demand destruction was dramatic. Actually it dropped by the same amount as world oil production, 15%. (How could it have been otherwise?) Then when OPEC ramped back up, this created a glut and oil prices dropped dramatically. However the recent peak in oil prices was hit when OPEC, and everyone else, was producing flat out.

In the light of all this, it gets rather tiring when some people continue to blame speculators for the high price of oil, especially when those people are members of this list, the very ones who should know better.

Ron Patterson

I am glad you explained that Ron. Let me see if I have this right...Oil prices on the way up = evidence of PO...Oil prices on the way down = lag time.

No sir, what he is saying is that price is a lagging indicator. We cannot draw any immediate conclusion about PO by simply using price as a measure.

How about a million and a half cars yanked off the Beijing highways in one fell swoop? Think that might temporarily dent the quantity demanded?


No, one and a half milion cars in Peking (showing my age)is only a drop in the ocean. Over 10 million new cars in China this year means the increase in the number of cars in the rest of China between beginning of July and the games end will cover that drop (and then some).

There is a lag time between high oil prices and demand destruction. I suspect this lag time is on the order of six months or greater. Actually I think it would be spread out over a period of from a few weeks to over a year. At any rate, we are seeing demand destruction start to have a very serious effect on oil prices.

You nailed it. The Fed has stated on numerous times that it takes 9 to 12 months for interest rate changes to alter the economy. This is probably true for other economic changes such as rising energy costs.

FWIW: It probably fair that the global economy can't tolerate the price of oil above $115 to $120 (in 2008 US Dollars). Demand starting falling much earlier in the year but it started to really accelerate in May. There are other factors such as declining access to credit and rising interest rates for consumers and small business. Plus the economic bubble started in 2004 was driven by excessively easy and cheap credit. Virtuall Consumers all over the globe where spending beyond their means by using debt.

Now that era of easy credit is over, its have a crushing effect on consumers spending. Not only are consumers not adding new debt to finance spending, they are being forced to pay back the debt accumulated during the run up. Less credit spending and less spending as they pay down debt. A true double edge sword!

The next run up of oil will begin when the dollar starts taking a dive when Washington starts spending recklessly to stimulate the economy as well as to keep the GSEs (Freddie and Fanny), and big banks from failing. Right now Paulson and other officials are trying to get foriegners to invest in US banks, but so far they don't seem to be taking the bait. Paulson has asked for $796 Billion Credit line for emergency credit liquidity (I think this means that Treasury sees at least $800 Billion in bad debt held by the GSEs and some other major banks near the brink).

We are heading for a major recession, lead by declining home prices, lack of cheap and easy credit and soaring commodity prices for food, energy and metals. The prices of commodites should continue to slide for at least the next six months, although I doubt we can predict how low and how fast they will slide. I read a couple of articles that suggest chinese factories are slowing or idling as excessive inventories are building up over their. This will also aid in declining commodity prices.

Also note that Mortgage rates and consumer credit rates have started rising rapidly. The Feds don't have to raise if the market it already doing it on its own.

“Maybe innocence is better. They just don’t know.” Rep. Roscoe Bartlett

Yesterday I went to visit a friend of mine who owns a small car dealership in North San Diego. I was looking at his inventory and I noticed that all of his cars were compacts or small sports cars like Miata'a. I asked him about that and he said nobody wants the big behemoths anymore so he is paying a premium for small cars at auctions because it's the only chance he has to stay in business. I asked him what he knew about the rise in gas prices and he said that is sounded like a combination of speculation and politics. He then pulled a fax he had recieved that day from a political action group showing what the Democrats had done to cause the rise in prices.

I then asked him if he gets his information from Rush Limbaugh and he said "Sure I listen to Rush on AM 600 when I'm driving...he's no worse than the rest I guess."

After hearing that I asked him if he knew about Peak Oil. He said, "sure he'd heard of it". "What does it mean? I asked. He really had no idea. We then talked for about twenty minutes about a number of topics related to peak oil but then a customer came onto the lot and I excused myself.

I really like Ray and I thought I would rather keep his friendship than pester him about Peak Oil and then after reading the above article about Roscoe Bartlett I made up my mind to send him an e-mail:

Ray - It was interesting for me chatting with you today. I think you're a real bright guy so it amazes me the scope of mis-information floating around.

Think about what we discussed today:

1. Peak Oil
2. Climate Change
3. Economic failure in global markets
4. Sustainable economics
5. The failure of the suburban paradigm
6. Population Overshoot
7. Failing cities

I know that is a heavy load but I believe it is paramount that people start a dialogue.

As I mentioned earlier I think stories are important. In that spirit I would like to share the following story with you:

On August 14, 1969 my uncle, Rod Davis, was in the Air Force stationed at Biloxi, Miss. This is his recollection of events:

There was a Hurricane named Camille headed their way. He was assigned to the Hurricane Hunters at Keesler AFB. Understanding Hurricane threats was their business. Well ahead of Camilles' arrival they issued national and local warnings and as a result the govenors of Missisippi and Louisiana issued evacuation alerts and the National Guard was called up. At Keesler AFB they scrambled all of the local aircraft out of the area and then battenned down the hatches in preparation. Even after all of the preparations they still sustained major damage but no loss of life.

The locals were another matter. They completely downplayed the threats of Camille and instead planned Hurricane parties up and down the coast. The bars even created a new cocktail (The Hurricane - 90 proof) and issued souvenir Hurricane glasses to the revelers.

When Hurricane Camille made landfall on the Mississippi coast it was the 2nd of 3 CAT V hurricanes in the world during the 20th century but was the most powerful tropical Hurricane that had ever been recorded making landfall. Official winds reached in excess of 190 mph. It flattened everything in it's path. Hundreds of people were killed and even in Alabama over 1,000 businesses were completely wiped off of the face of the earth. To say it was a trainwreck would be an understatement. After the worst passed the airbase organized local relief efforts so they got to see first-hand the devastating effects. Those fools partied in the face of of one of the worst Hurricanes in history.

In reference to Peak Oil today I see a much larger threat yet I also see the same complacency. The impact of Peak Oil will make even Hurricane Katrina look like a minor interruption in comparison. The problem with Peak Oil is it won't happen in a matter of hours so you won't see the storm clouds and high winds and there won't be the calm after the storm. Instead it will happen over years...decades really but the effects will be lethal. Also there won't be national resources or organizations like FEMA coming to the rescue. As national governments' resources dry up so will they. For the most part people will be on their own.

When President Bush said that America is "addicted to oil" he didn't get it quite right. What he should have said was "American is dangerously dependent on cheap oil".

What to do? In my opinion personal education is the most critical thing to do right now. With a few exceptions I consider main stream media to be clueless. Television and radio pundits (the chattering classes) should be rounded up and charged with mal-practice. At the same time politicians pander to the lowest common-denominator: stupidity.

People need to drop any illusions that we can stop it or cure it or worse yet deny it out of existence. Like Cammille in 1969 it's coming but there's no stopping it. The best we can hope for is to mitigate the disaster through intelligent preparation.

If we are going to have any chance at all we will have to find the leadership in the shaving mirror, not the TV screen. In other words the answers will come from grass roots efforts and not from global centralized organizations.


P.S. For starters read The Long Emergency by J.H. Kunstler

After I sent the e-mail I thought: Now you're going to be that annoying Peak-Oil guy every time you see Ray. Oh Well!

Best post of the day, but then I love stories.

Rep. Bartlett is a good missionary to mainstream Americans, precisely because his social and cultural agenda is diametrically opposed to mine. He's been vetted by the Right, now they're stuck with his inconvenient truths.

Mind if I quote you on my blog? That's a fine piece of writing.

go ahead.

I might as well, if it's all the same to you. :)

Great talk by occasional TOD poster Steve LeVine on Russia, Putin, and some oil, gas talk in the q&a.

"Steve LeVine: The Dark Heart of the New Russia"


The Commonwealth Club of California
San Francisco, CA
Jul 14th, 2008

Russia's rich oil reserves are helping the country regain prominence. Under Vladimir Putin and his sucessor, Dmitry Medvedev, nationalism has grown as well.

Thanks. I try to follow Mr LeVine's post. He's a fairly keen observer of Russian matters - even though I consider him slightly biased. He comes down very harsh on Russian geopolitics and human rights abuses, but passes over the same violations by USA. Maybe that's because he follows Russia, not USA, but it does stick out a bit, imho.

Weekly NG Storage Report:

Working gas in storage was 2,396 Bcf as of Friday, July 18, 2008, according to EIA estimates. This represents a net increase of 84 Bcf from the previous week. Stocks were 347 Bcf less than last year at this time and 22 Bcf below the 5-year average of 2,418 Bcf. In the East Region, stocks were 2 Bcf below the 5-year average following net injections of 63 Bcf. Stocks in the Producing Region were 6 Bcf below the 5-year average of 758 Bcf a net injection of 10 Bcf. Stocks in the West Region were 14 Bcf below the 5-year average after a net addition of 11 Bcf. At 2,396 Bcf, total working gas is within the 5-year historical range.

This is good news. The storage gap is closing with the 5 year average. I hope to make it through next winter without a doubling of prices. Go drillers! Go!

And then the next year? And the one after that?

Go McCain go! Maybe he and his Republican Brown-shirts can take the energy issue, spin it and convince enough illiterate NASCAR nitwits to give George Bush 4 more years.

I can already picture Obama wind-surfing to defeat in the fall.

The director-general of the International Atomic Energy Agency wrote yesterday in the Financial Times that "A global agency is needed for the energy crisis".

He points out that there are global, theoretically non-partisan, institutions for food, finance, health, aviation, shipping and so on, but nothing for energy. Which does look like a bit of a killer oversight right now.

The piece ends with:

Even the pessimists believe we still have at least a few decades before the oil on which the world’s prosperity is built starts to run out.

I guess the people he talks to are only pretending to be pessimists...

We already have a global agency. It is called The United Nations. Unfortunately, the azz hats that are currently in control of the US have attempted to discredit and destroy the UN. Granted, the UN has some problems but it is not beyond reform.

Instead of adding another layer of bureacuracy to the world why not form the new 'energy agency', if it is needed at all, under the auspices of the UN?

I can answer the question for you: Because the hypothetical 'UN Oil Agency' decisions would be subject to veto by China, Russia, and others. What the US seeks is a 'World Oil Agency' that is another US sock puppet. This stupid idea sounds like something John Bolton would come up with.

Balance of power matters where there is no supreme power. The UN could only be as effective as the superpowers allowed it, and that wasn't much. But the wartime alliance that preceded it was driven by short-term self-interest and succeeded in its primary goal. We need to get the Big Four of energy on board to be the Energy Security Council: the US, the EU, Russia and China. All these countries have a vested interest in having some energy available for the rest of the world. The US and EU need cheap overseas labor, Russia needs energy customers, and China needs consumers. Concerns about all these are becoming short-term in nature. The EU greatly disagrees with the US on environmental issues, and Russia and China greatly disagree with the US on everything else. So it cannot dominate such an alliance, which is good. Between them, these states currently spend over a trillion $ a year on militaries, largely to checkmate each other as they all go over the cliff together. We form alliances to fight a common foe more cheaply and effectively, don't we?

The problem is the EU. If Europeans don't realize that the current crisis is beyond the ability of any one state to survive, that in fact this is the only matter that justifies the EU's existence (not stupid consumer regulations and farm subsidies), then I don't imagine the dumber, crazier people inhabiting the rest of the planet will ever get around to saving themselves anyway. If Europe can unite to tap the multiple energy potentials of North Africa, then it's a very small start towards what a surviving world will look like, and a model for the other great powers.

Ah, but Europe is too slow on the draw...'If Europe can unite to tap the multiple energy potentials of North Africa,...'

Perhaps you missed my posts last week about Gazprom/Gaznaft sewing up a deal with Lybia to purchase all of their gas at market price? Russia is going to build a pipeline beneath the Med to Lybia. Russia's energy giants are cutting deals with Nigeria. Russia is also busily out manuvering the US in the Stans.

People sometimes like to look at the micro when they should be looking at the macro. As the SCO continues to weaken the US economically the US will be unable to compete on the world stage for resources. Europe meanwhile will be subject to economic weakening by the Russian energy giants by controlling European gas and oil. Anyone that cannot see these moves coming is not looking very hard.

Arctic's oil could meet world demand for 3 years

That's the first time I've seen a major news outlet frame the Arctic oil supply in that manner. I suspect that the discussion has awakened at least one journalist. ;)

This was in yesterdays drumbeat also but there wasn't any discussion. Does anyone have an idea of the reliability of the USGS estimate? My gut feeling is that the USGS is probably giving an irrationally exuberant estimate. I feel this because of their world crude oil reserves estimates from a few years ago were that way:

To me, this looks like a nonsensical estimate based on the assumption that future growth will follow past growth.

*edit* Normally I respect the USGS quite a lot since I worked there as a "hydrologist" when I was an undergraduate, but their oil reserves estimates are just beyond belief. I suspect that the downsizing of the geology division that occurred in the 90s, I bet that people there now feel they have to remain on the right side of the political fence to keep their jobs.

They didn't mention the estimated cost per barrel-maybe someone here would have an estimate-$100, $125 a barrel? I don't think that would make such a pretty headline.

Current Director Mark Myres:


Mark Myers is an American geologist. Myers became the fourteenth Director of the US Geological Survey (USGS) on 26 September 2006 after confirmation by the US Senate.[1]

Myers had previously worked as head of Alaska's Division of Oil and Gas, resigning along with five others in late 2005 as a protest over Republican Gov. Frank Murkowski's negotiations with oil companies to build a natural gas pipeline [2][3][4].

Myers earned his bachelors and masters degrees in geology from the University of Wisconsin at Madison. He received his Ph. D. in geology from the University of Alaska at Fairbanks in 1994, specializing in sedimentology, clastic depositional environments, surface and subsurface sequence analysis, and sandstone petrography.

He was a Petroleum Geologist for the State of Alaska Division of Oil and Gas, and then Senior Staff Geologist for Exploration at ARCO Alaska Inc. and Phillips Alaska Inc. He was the Alaska State Geologist and head of Alaska's Geological Survey.

I don't think this guy is going to be high up on the list of people who wan't to break the great news!!


The Alaska Permanent Fund check was up to $1,654.00 last year. Of course we have to drill in the Arctic, we have to keep those oil dollars to Alaskans flowing. (For those who don't know, instead of paying state income taxes, residents of the state of Alaska receive a check each year from oil revenues. link)

I bet that people there now feel they have to remain on the right side of the political fence to keep their jobs.

Les Magoon has worked for the USGS for many years and he has been talking about Peak Oil for over a decade.
The Big Rollover

For more information: lmagoon at usgs.gov

Yeah, I guess you're right. This probably isn't the problem with the USGS as a whole, it's probably due to the political appointees at the top. This is pretty common in other parts of the government too I guess. Those poor schmoes at the EPA have been twiddling their thumbs for years because their hands have been tied by the current administration, and the head of the EPA also takes it upon himself to veto whatever he feels like.

Gwydion, you are right. The political appointees are, in the main, worthless. 'You're doin' a he** of a job Brownie' is only one tiny example in a sea of malfeasance.

Ask where political appointees come from...Campaign staffers, the Pentagon, wives and husbands and families (nepotisim), former state politicians like Gonzales, etc.

How are these appointees qualified to carry out their new duties in government? They are not. They depend on career staff under them to insure that their department continues to function. Imo, this is where the wheels fell off the current administration. Consider: This This admin didn't want anyone that was not a loyal republican and massive house cleanings were undertaken in many departments, not the least of which occured under Gonzales and his predessor at Justice. Then there is the debacle of Iraq where kids right out of college were sent to 'rebuild the Iraqi economy'. The kid that was sent to Iraq to oversee the restart of the Iraqi stock market was a fresh college grad with no work experience...but he was a loyal neo con.

It comes from the top and they are incompetent. How would one that is incompetent judge the competence of a prospective new hire?

get popcorn, roll film

This was the survey that applied the US reserve growth phenomena (of proven reserves) to world wide IHS database reserve data. The methodology has been discredited by multiple sources. You can read about it in detail in the Energy Watch Groups Oil Report

The second point of critique refers to the fact that – as is known to all experts - the growth of
reserves in the USA in the past was much higher than elsewhere. This is a direct consequence of the regulations by the Securities Exchange Commission (SEC), which for financial reasons call for very conservative evaluations at the beginning of the development of an oil field. This US practice leads to systematic underestimations.

For these reasons this marked reserve growth in the past was only observed in the USA and can not be extrapolated into the next 30 years, nor even less can this pattern be applied to the whole world.'

Kinda funny when compared to how AP spun it:

"Vast oil, natural gas reserves estimated in Arctic"

Yes, it's the same story!

GreyZone, we can but hope.

The BBC is running the story as Arctic 'has 90bn barrels of oil' on its news website, with virtually no meaningful context. They did the same thing with a TV and radio story they ran the other week about Russian oil reserves. It began with the classic 'despite record oil prices there's no sign that we're about to run out of oil' line. Then a brief interview with someone (I forget whom) about the 'underinvestment' in Russian oil infrastructure. Then a look at a British company working in the Siberian swamps, closing with a line about how there are 'a billion barrels of oil' there.

It's particularly disheartening when this stuff comes from a public service broadcaster. Numbers like '1 billion' sound comforting but are meaningless without the wider context.

P.S. Sorry for all the posts today: it's a really slow afternoon at work!

More on the USGS Arctic Oil and Gas story:

USGS Estimates the Arctic Holds About 22% of Global Undiscovered, Technically Recoverable Oil, Gas and NGLs

These resources account for about 22% of the undiscovered, technically recoverable resources in the world. The Arctic accounts for about 13% of the undiscovered oil, 30% of the undiscovered natural gas, and 20% of the undiscovered natural gas liquids in the world. About 84% of the estimated resources are expected to occur offshore.

A probability of 100%? Wow, that's some crystal ball they have. Or do they mean these are areas where there has already been a demonstrated recovery?

One other thing I noticed:

Technically recoverable resources are those producible using currently available technology and industry practices. For the purposes of this study, the USGS did not consider economic factors such as the effects of permanent sea ice or oceanic water depth in its assessment of undiscovered oil and gas resources.

As far as I'm aware, "economic factors" such as sea ice and water depth will greatly affect whether a reserve is technically recoverable or not using currently available technology and industry practices. It was good of them to admit it, but I feel like they're talking about "potential reserve areas" but then calling them recoverable reserves and it's a bit much. As is well known, you don't know for sure if there's oil in the ground until you drill the well, estimates will only get you so far.

I believe that the important point is that it is 90 billion barrels of "undiscovered oil". It really truly is there until you actually look for it.

And then it isn't.

Kinda like a great big electron.

The following news story talked about arctic sedimentary rock being much older and more fractured than other offshore sources (thus, a lot of the good stuff would've leaked out millenia ago). I'm not a geologist, so I wouldn't know. But it was a good read. Any thoughts from you folks who have degrees in this stuff?


Hmmm....If the resources are "undiscovered," how is it known they are there or even "technically recoverable"? Even if some fraction of the USGS estimate is there, extracting the resources in the offshore Actric Ocean environment makes mining on the Moon look easy. It would be much cheaper and easier to pay Venezuela $200/bbl to fully develop its Orinoco heavy oil resources.

This map clearly explains the reason for all the "Russian Arctic oil grab" hysteria in the western media. By far all the possible finds are in the shallow portion of the Russian sector. NATO members are hopeful they can establish some sort of argument that they can drill even within the 200 mile limit. The deep waters, as expected, are not going to be a wealth of new oil.

Bicycle theft is all over the UK press today.

Cameron's bike stolen as he shops

Conservative leader David Cameron says his bicycle was stolen after he left it locked outside a supermarket while he shopped near his home in west London.

Tom Bogdanovich of the London Cycling Campaign said he hoped the theft would not discourage Mr Cameron from using his bike.

The case highlighted the need for a greater number of secure cycle stands in London, he added.

I wouldn't bank on this one case changing anything though.

Best hopes for more thefts of MPs' bicycles?

Tom Bogdanovich of the London Cycling Campaign said he hoped the theft would not discourage Mr Cameron from using his bike.

Now, I don't know about London, by where I live, when I have my bike stolen the lack of having the bike sure does discourage me from riding the now stolen bike - what with not having it anymore.

Well it hasn't stopped him wearing his new clothes ...

This is happening in Toronto too:

Bike theft tally tops 1,200

Very interesting in light of the Saudi's claims that they have all this SPARE CAPACITY!!!!

spare capacity != spare oil.

Cap'n Kenos in leucadia usually has spare capacity, but that's because you can't get people to eat there.

err.. != means not equal.

USA Today has a special report on community colleges. They are getting to be increasingly expensive:

The price of an education is likely to be debt

I think this is a disaster in the making. Kids assume they need college to have a decent life, but many are starting out in the hole because of the costs. They may never get out of it if the economic SHTF. And you can't get out of repaying student loan debt by declaring bankruptcy.

I am expecting something like the Veterans' March on Washington in the Thirties--except that it will be debt burdened students marching on Washington. As I said yesterday, funding an expensive college education for your graduating high school student--especially one that results in a soft degree--is akin to turning a weapon of personal financial destruction on one's self. A better idea for many high school graduates will be a two year associate degree, related to some kind of specific, and essential, job skill.

Yeah, but even two-year degrees are getting awfully expensive. Community colleges that had prided themselves on encouraging students to avoid debt are being forced to join the federal loan program.

What ever happened to apprentices and OJT?

Job Corps still exists, and we have a very popular and productive campus just up the highway.

We used to have a Vocational School. Then it became a Vocational Technical School and is now a Technical College tied into the State College System.
Vo-Tech students have to take mandatory classes in important things like "community appreciation". And where they used to give complete well rounded skills training, they now focus on training the student to learn to run one machine for one specific employer (and I think the employers are helping push this.)
The "Dumbing Down" of Americas technical skills.

If kids want a real education today, they had better learn to read so they can get books from the library or book store and learn on their own. Schools aren't in the educating business any more.

All the technical subject classes I took at night from the local high school and vo-tech don't exist anymore.

Rant mode off

Books are good, but the internet is the more likely source of info. Wikipedia really is an amazing way to learn about stuff. Well written articles not only give you decent overviews of topics, but link to more sources to help you expand your knowledge beyond the article. Search engines pick up and go beyond were wikipedia leaves off. If there is a topic that you can't find info about on the web, it means that it is your chance to be an expert in an esoteric field!

The future of education is Back to the Future: Socrates would be thrilled with the internet.

I think the "soft" degrees are the main problem. It makes absolutely no sense to spend $60k+ at a state university for a degree in history/political science, journalism, or dozens of other degrees of questionable value. They get out of school at 22(or 25)and if they are lucky enough to find a job, they make $30k, if that. The bottom line is that it is a terrible investment of time and money, but that doesn't seem to stop it. One guy I went to high school with went to Princeton and got a degree in sociology. Five years later he was back in town, working at Red Lobster. I was fortunate to have parents who understood this... they made it very clear they would not be paying for any "BullS#@T" degrees.

I think this is the most critical point. If you get a BS from the Colorado School of Mines (or similar), you'll have a high paying job when you graduate. That's a good investment, in my opinion. A BA in English from State U, not the same deal. Or, you could go to a service academy, pay no tuition, get a B.S. in engineering, and have a guaranteed* job when you graduate.

*Note: this guarantee works both ways.

My boys have said they want to be in the Army or Marines when they grow up (they are in grade school now).

I've told them they may not be given a choice. Uncle Sam wants You (points)

I disagree- think of the expertise you get with a journalism degree from Harvard. You can win a Nobel Prize.


I'm thrilled my boys are working hard at history, english, music and language. A serious liberal arts education is exactly what they need to understand the challenges of their lifetime. Not business training or some such. Nor even engineering and science. And no way economics.

And they are doing this at high school - not in college. I've been quite clear I don't expect them to do college. Not just to do college anyway and certainly not for a "job".

We might both argee about a degree in sociology - but hey, what else did your acquaintance learn at Princeton? Maybe he worked at Red Lobster so he could finish his novel or some such.

Full disclaimer - I have a BS in Art from MIT. Parse that.

cfm in Gray, ME

Absolutely right - No knowledge is ever wasted.
And I've got a B.A. in Chemistry!

When education became a "capital investment" we were screwed.
Knowledge that helps one in a superstition and greed based economic and social philosophy like capitalism, is useless and counter to one's ability to access the embedded physical reality of life and it's existential questions.
I know, I'm a elitist, but one who lives a simple life in a good place.

And what is "education to meet the needs of tomorrow's businesses?" More debt. We have too many people wasting effort trying to get college degrees in an industry focused on maximizing credential throughput. Almost all of them would make a bigger contribution to society if they read and discussed - even in a trivial way - some of the great works of literature: Merchant of Venice, Henry IIII, Silent Spring, if not Diet for a Small Planet then Fannie Farmer. The Grand Inquisitor, We, The Mass Psychology of Fascism.

More Criminal Justice grads to staff our prisons we do not need. More business school graduates we do not need. More coders to break the intellectural property barriers we -the human species - need very badly. We need criminals like that to break the paradigm in which we are trapped.

The return vs the price is a huge issue. When I was in college (Class of 78) the *price* did not come close to reflecting the *cost*. Nowadays it seems the *price* is the *benefit-$1*. An entirely different concept. When I went to college, a good college education was part of the societal contract. Now it is personal gain.

Half of Americans are functionally illiterate, Joe Bageant documents in "Deer Hunting with Jesus". ANOTHER 25% can't follow a 5 paragraph argument. Which this comment is. Yeah, I'm all for an "irrelevant" liberal arts education.

cfm in Gray, ME

Hi Dryki,

I obtained my undergraduate degree in 1982 (BA Honours, Political Science). I was digging through some old files not long ago and came across the receipt for my tuition in that year -- a little less than $800.00 for two full semesters ! Vive le Canada !


I would agree that there is value in all of these endeavors, even sociology, but not enough to justify four years of your life and 60k..or more if you go to Princeton. Our kids need skills to survive first. All of these other things can be learned outside a classroom. As an elective at Texas A&M I ended up taking a Latin American History class my junior year to fulfill a humanities requirement. It was an interesting class, and I learned a lot. However occurred to me that I could have gained the same knowledge by borrowing the textbook from the library and reading it over a weekend, saving a lot of time and money. So my advice to anyone pursuing such a degree is to drop out, get a library card, and learn how to weld, fit pipe, or operate a crane.

Without vocal people like myself with "soft degrees," the Propaganda System would have run rampant and the Indoctrination System wouldn't have met any resistence whatsoever. With all due respect, Peak Oil is a sociohistorical and economic phenomenon generated by geological constraints. Politcs constructed the current economic structure/paradigm, and politics will be the menas by which the new paradigm will be arrived at. Science and engineering and the socialsciences are not exclusive of the other; rather, they must operate inclusively in a holistically balanced manner, which is currently not the case, and IMO is the bane of our present condition because the political ideologues bent on Imperial Conquest have had too much power for too long.

Boy, I must have pushed somebody's button to get a minus for speaking the truth once again. And of course that someone didn't bother to cobble together a rebuttal.

To quote a great bumper sticker:
"If you think education is expensive, look at the cost of ignorance"
Education, even soft degrees like sociology, are needed. Look at what has resulted from the US being run by business people and lawyers. An ignorant nation can be pushed around by fear mongers.

Most TODers probably know this already, but I think there may be important cultural-political-economic circuitry being misunderstood here. The classical educational ideal, enshrined in the liberal arts, was to have well-rounded people (mostly white males) at the helm of the important institutions. All folks with similar cultural capital, often intermarrying. For example, John Hofmeister, Shell CEO, when he was in Portland last year on his big tour, I asked him about his undergraduate major; it was political science.)

The problems to which Westexas alludes have come about from three interrelated developments, IMHO:
- degree inflation, with too many people aspiring to this sort of education;
- people pursuing these "soft" degrees without the appropriate class background; e.g., there used to be virtually no study abroad programs at the elite schools because, well, you would already have been to Europe, wouldn't you have?
- re my opening statement, the classic liberal arts undergraduate degree was never really intended to prepare one for a specific career. Rather, it was to prepare (and weed out) a new set of recruits for the leadership positions.
The professionalization of these fields transformed the PhD to the terminal degree, when it was originally rare; the MA was originally the terminal degree for teaching.

Seems like a shakeout of the university system is underway, with a return to an older model of post-secondary education. I teach at a small liberal arts college, and wonder about how these trends may affect schools like ours. Perhaps relocalization will boost the fortunes of regional liberal arts colleges, tasked with preparing regional elites, while national level schools will see fierce last-man-standing competition.

Good post.

I think the economics are going to turn against college. Sure, a liberal arts education has intrinsic value...but who will pay for one, if there's no job waiting on the other side? And how will they pay for it, when they can't afford gas and groceries?

And it's not just the cost of college. It's the cost of all that time spent not working. Only a few generations ago, a lot of kids didn't go to school (or didn't go for long) because they were needed to work on the family farm, or in the family business.

Poor girl wants to marry and the rich girl wants to flirt
Rich man goes to college and the poor man goes to work
A drunkard wants another drink of wine and the politician wants a vote

I don't see this changing much.

(that's Charlie Daniels, btw)

Gotta add that colleges and universities do more than just hand out slips of paper, there is a ton of research being done as well. No students = funding for research dries up, and that can't be that good for society.

Yes. This is why I don't think we will maintain our current level of technology. It's too expensive, in ways we aren't even aware of. Like the cost of supporting colleges, teachers, and the school systems that feed into them.

Wow, could not disagree more with this. Education is good, period, be it English, political science, engineering, accounting, law, etc. Some grads, however, will fail to be financially successful, yes. So what?

I agree: education is good. In any subject. Period. The question here is whether it justifies the loan payments that will be required. Learning what the hell James Joyce was talking about in Ulysses: $120,000. Not being so far in debt that you can't feed your family: priceless. The promise of dragging oneself out of mediocrity can be extremely alluring, though. I have a JD and my wife has a MS/MBA, so I can't really in good faith say that others shouldn't invest in education. I think people just need to realistically appraise the value added of a degree against the cost. As I said above, for a well qualified 18 year old, investing $100k in a B.S. from the Colorado School of Mines is probably a good value. I think that a B.A. in Irish Literature is great, also, but I don't think it's worth $100k in loans for a person who doesn't already have family money. You're paying for the degree--the certification that you actually know something in a topic. In many instances (though admittedly not all), the actual knowledge can be gained for free, or for a small fraction of the cost.

You're paying for the degree--the certification that you actually know something in a topic. In many instances (though admittedly not all), the actual knowledge can be gained for free, or for a small fraction of the cost.

I agree 100% My 25 years of job acquired expertise wasn't enough to satisfy corporate head-hunters, who insisted on a sheepskin of any sort in order to jump through the first hiring hoop. After receiving similar responses at a total of 5 multinationals, I said screw-it; I'll go back to college and get my degree, but it's going to be in something that I want to do. I'm more than happy with my result, and certainly accept the consequences of my choice.

Getting a degree back when I did it was a real value: at the height of the vietnam war, a '2S' deferment at the paltry cost of a student loan. Heck, I even paid it back. Not having your ass hauled off to indochina to shoot and be shot at: priceless.

I went to about twice as many classes as I was signed up for; the interesting ones that had nothing to do with my major and were too "popular" to get into; there were always empty seats and the professors never complained. Getting the degree made my parents proud...

But y'know, as life went on nobody but nobody ever checked to see whether I actually HAD the degree, much less asking what sort of grades I got. I got all sorts of technical jobs based on the degree in my Bio which turned out to have little to do with anything I had learned related to the degree; and had I had the chutzpah to just claim I had the degree, the results would have been the same. So in retrospect, I figure what I paid for was the privilege of someone else going to war in my place, with the degree sort of a crackerjack prize.

Going into debt for a degree these days makes little sense to me unless you need to apply to a place which actually checks on you. Few do.

So in retrospect, I figure what I paid for was the privilege of someone else going to war in my place, with the degree sort of a crackerjack prize.

My father was in Uni studying Civil Engineering when he got the call to go to Vietnam. Even though he could have got out of it because he was studying, he went anyway, saying that if he didn't go "some other Mother's son would have to".

Frankly, I'm not sure I would have done the same thing. We all make our choices.

I suppose I should be happy he went, because when he came home (after having his arse shot at, and having his tent run over by an APC, which happened to be driven by his future brother-in-law (small world)), he met my mother, and a few years later, there I was. ;)

It seems that the current setup favors people who know how to manage, flim-flam, or manipulate other people, not those who have technical skills. So if a poli-sci degree helps you manipulate people and get a job in governing, it might be worth it. Business and law also seem good nowadays.

It makes sense in a way--people are more complicated than machines, so manipulating people must be worth more than manipulating machines.

If the soft degree helps you to manipulate people, it's probably all good.

Declarative statement to aspiring Law Student: "The World needs ditchdiggers too!" Ted Knight - Caddyshack

Obama has said some interesting things on his education policy. But talk is cheap.


he promised to make community college completely free and offer a $4,000 tax credit to cover two thirds of the tuition at an average public college.

Democrats and tax credits. How glaring the class aspect of that. The proles get free community college - probably learning how to use Microsoft Access - and the upper class gets tax credits at the "better" institutions.

cfm in Gray, ME

It matters if he can show how to cut costs. Something about the teacher-student model of education is going to have to change, just like the doctor-patient model of healthcare.

A tax credit is a credit against owed taxes. Rare is the student who earns enough to pay taxes. Hell, make it 10,000 credit, it still won't cost anything.

Just get a loan, don't pay it back, and get a government bailout check. It's the American way!

From the Chatham House study on oil exporters, linked uptop:

Strikingly, it shows that even Saudi Arabia must plan for export decline

Do ya think?

From my post Drumbeat post yesterday:

Regarding Saudi Arabia, it would appear that 2009 will tell the tale--as to whether they can match or exceed their 2005 average production rate--since it appears very likely that their 2008 average production rate will be below their 2005 rate. Regarding their net export numbers, here are the annual EIA numbers for Saudi Arabia, and my estimate for 2008:

2005: 9.1 mbpd
2006: 8.5
2007: 7.9
2008: 8.3 (estimated)
2009: ?

I estimate that if Saudi Arabia wanted (and were able), in 2009, to match their 2005 net export rate, they would probably have to boost total liquids production to about 11.8 mbpd (versus their 2005 rate of 11.1 mbpd).

If the refining capacity for heavy, sour crude is increased as has been discussed here on several occasions, and if the Saudi's have the reported monstrous shut in reserves of heavy, sour crude, I would think that they could well bust their previous best, but the yields will not match what was achieved from Light Sweet Crude. I would think that this could take the edge off the current shortages, but with all demand increasing, from exporters and their customers alike, the benefits will be short lived. I would also think that the Chinese deals with Venezuela, if filled with Heavy, Sour Crude, could ease some of the price pressure. Demand will continue marching on, however. Now, if we had a massive recession/depression and if construction of heavy sour crude refineries were kept on schedule, then we might see enough additional capacity and demand destruction to make a difference. Too many if's though, and won't postpone crises for very long.

"if we had a massive recession/depression"
Apparently you give this a fairly low probability. As a triple doomer (financial, energy, climate), I think it all too likely.

Re: Pimental and ethanol pipeline up top:

I have normally have little time for David Pimental of Cornell and his to my mind completely phony ethanol EROEI studies that I can not verify on my farm.

However as much as I hate to said it, he is spot on with his Americans should go on a diet recommendation pointing out the energy waste in feeding corn to animals. He is also correct to point out that transporting a low value coarse grain around the world is a waste of energy. It should be used locally as westexas has pointed out umpteen times.

Too bad that he can't bring himself to the next obvious step: what to to do with all the corn saved by less animal feeding and exporting. Of course the logical thing is to use it to make ethanol and use the ethanol locally.

This is where the fallacy of the ethanol pipeline comes in. Most who post here appear to be outside the Midwest corn belt and dead set against ethanol. So be it. Let them do their part in the Post Peak Oil world by conservation. It's their bag and they want to do it. Fine. It makes no difference in the overall big picture who does the conserving as long as it gets done.

And it makes no difference who does the additional consumption of liquid fuel for transport if there is any. Therefore the logical thing to do make everyone happy is confine ethanol consumption to the Midwest where it is produced thus saving on transport cost.

The Midwest can probably run on E85 for some time before the rest of the country comes to its senses and wants some of it for themselves.

Conservation isn't hard at first, but it gets harder and harder to conserve as ever less fossil fuel becomes available. The Midwest ethanol producers should anticipate this and make safeguards such as not building pipelines and discouraging ethanol consumption is non ethanol producing parts of the country all the while creating ethanol infrastructure in corn producing areas.

Sadly at some point the booming ethanol economy will breed so much envy and resentment that it will come under even more attack than it does now. But that is a battle for another day.

In my view, putting land in competition with food is always a bad idea when the quantities become large enough.

That's because although the feedstock for ethanol (or cellulosic ethanol or whatever one's favorite feedstock is) can be grown on marginal land doesn't mean that it will be grown exclusively on marginal land. A farmer will use even his best land to grow the feedstock — he will do so even if that means taking food crops out of rotation. If the profit is there, he will use whatever land is available that will provide high yields so as to maximize his returns. His personal goal is to maximize financial returns, not maximize food production. This drives the system.

The result is that almost any imaginable kind of fuel that must be grown in a field will be in competition with our food supply.

Add to that two additional pressures:
* forests will be cut down to plant fuel feedstock (if there is profit to be made, the forest will be cleared)
* the decline in energy available for agriculture will decrease crop yields, thus forcing farmers to use more land to grow whatever they have chosen to grow, again increasing pressure on forests

We have created terrible feedback loops and the only way out, in my view, is to break the loops completely and dramatically reduce consumption of, well, just about everything.


How much ethanol does "your farm" use each year ?

How much Fossil Fuels (diesel etc.) ??

Don't phone Washington when you need Morocco invaded for its phosphorous.

The Midwest ethanol producers should anticipate this and make safeguards such as not building pipelines and discouraging ethanol consumption is non ethanol producing parts of the country all the while creating ethanol infrastructure in corn producing areas.

I agree. The East, West and Gulf coasts are ridiculously unsustainable. They can meet the EPA regs with MTBE made from expensive natural gas. The result will be low prices in the Midwest and higher prices everywhere else. Our Canadian syncrude will keep a decent amount of crude going for local diesel and E85. The Midwest will start looking a lot more like Brazil in terms of energy and the rest of the country will look like Europe.

In fact as a general principle we should just forget about a national system of energy--people are just too stupid to understand the need for it.

You want to at least survive Peak Oil?

Move to a more sustainable part of the country, dude!

So, USGS estimates 90 Gb, or 22% of undiscovered reserves growth... How does this compare with previous estimates by others? I saw a TOD post a couple years back say that CERA estimated 118 Gb in Arctic - so this estimate is a downgrade of ~24%? Anyone else have referenced information on that or other estimates?

Dennis ( http://www.setenergy.org )

i believe the usgs uses the ihs database, yes that ihs, the ihs that cera is a part of.

and here's a link for the terminally curious:


From "The Coming gas supply shock in the Gulf"

However, Qatar cannot supply the sheer magnitude of the gas demand that will arise from the lower Gulf’s power generation, aluminium smelting, water desalination, petrochemicals and iron ore industries. Qatar has even declared a moratorium on new projects in the North Field till 2010, an ominous indicator of a future GCC gas squeeze. While Qatar and Iran have some of the world’s largest gas reserves, Iran is prevented from US Treasury sanctions from the billions of dollars in international bank credits from converting its gas into viable new production and supplies. Regional politics preclude Iran from emerging as a significant gas supplier to Saudi Arabia and the rest of the GCC. The gas supply deficit in the region could well provide both the impetus and strategic opportunity for the evolution of a nuclear power industry.

There has been an assumption that as natural gas prices rise in the US and UK that domestic industries will close and move overseas to cheaper supplies of NG. I wonder if that is really possible? Or if moving those industries will soak up the little LNG potential that did exist?

-Personal preparation category: looking forward to reading your comments !

As a European (Austrian) reader of the oil drum for some years now, I was encouraged to strengthen my intention to acquire a nice plot of land but added the requirement of good water and if possible small hydro power.
Now I have found a small hydro power (and sawmill) in OK climate with yearly output of 120.000kwh which could be increased with a little maintenance to 135.000 without much expense next to a tiny rural city.

The only drawdown... little land, just 2700m2 (i.e. investment only which is a drawdown) or 10000m2 with a totally rotten millbuilding that is a potentially protected building (for 200k OBO).

I offered 135k euro for the small plot and hydro and the seller is reluctant and asks 150k, considering that the next quarters elec. base load futures already increased to 10c /kwh (fell to 8.9 now) I probably should increase my bid a bit. I have no debt, but would finance for tax reasons.

Larger ones with 2Mwh/a cost 2000k euro so small is always more expensive, but what is your opinion.

Given the future European energy outlook, which is grim IMO, I would up my offer to 143K. The longterm return on investment is your friend and your security.

That is what I thought, too. Thank you for the confirmation.

Warning - the river that feeds your sawmill may run low in the future if it depends on glacial melt from the Alps. I'm sure you can find some group that's monitoring that for the ski resorts, etc.

Thanks for the warning, it is no alpine river, actually this year we have very heavy rains 200l/m2 in June and already 120l/m2 in July.
I accept the risk of stronger and weaker waterlevel years.

You may be able to extract more power from the site with modern, high efficiency turbines (and less water spilled without generating power during higher loads).

I would suggest contacting MHyLab in Vaud Canton.


Best Hopes,


Thanks for the link, they specialize in Pelton turbines with water head of 100m plus (and little water), my target only has 2m head with 2.5m3 water.

Everyone interested in small hydro should check the publications on http://www.esha.be/index.php?id=39 and remember if you build one yourself with only little water (0.1-2m3) and little head (c.2-5m) a top feeding water wheel is the best choice reg. price and efficiency.

Wait six months, then offer a lower price. The Global economic is marching to recession. Credit is becoming hard to get.

Personally I think buying a small plot of land because it has 120kwh/year is a waste of money. 120kwh/year works out to about 14 continuous Watts. A couple of 80Watt solar panels would exceed that output. You probably do better with a larger piece of property that can be used to grow food and plant fruit and nut trees. Land with large amounts of woods would also be very useful as a building material and fuel resource.

I think he's saying 120 thousand kWh/year, close to 14 kW average power available. (120.000 would be conventional European notation for 120,000 American notation, I believe.) That would equal a REALLY serious PV array plus storage.

You are right, sorry I forgot to adapt the number to the English/American notation.

Wait six months, then offer a lower price. The Global economic is marching to recession. Credit is becoming hard to get.

Consider making an Option to Buy over the land for some future date, but get the loan now (pre-approved).

Not sure if this one flew under the radar... Timothy Egan's op ed in today's NYT

The Oil Man Cometh

There he is, the sound of money in a wizened Texas drawl, the tired realist looking a bit like the John Huston character from “Chinatown” as he warns in national television ads that we should just listen here and do as he says.

And what the 80-year-old T. Boone Pickens says, in a $58 million campaign, is that we can’t drill our way to lower gas prices. By implication, anybody who tells you otherwise — including the fellow Texan he helped put in the White House — is a fraud.


Oakland Airport does it the Boone Pickens way:


The Oakland Board of Port Commissioners recently authorized the purchase of 26 new CNG-powered AirBART and rental car shuttle buses that will be deployed at Oakland International Airport (OAK) beginning in 2009, replacing older diesel-powered models.

The replacement of 26 diesel buses with natural gas buses will result in major fuel cost savings for the airport, projected at up to $400,000 annually, based on current market prices.

A look at Whatcom County Sheriff's Office's largest ammunition purchases. Note: Cases contain 1,000 rounds.
.40-caliber bullets, practice use
125,000 rounds used per year
Price per case last year: $117.50
Price per case this year: $202.70
.223-caliber bullets, practice use
60,000 rounds used per year
Price per case last year: $148
Price per case this year: $372.80
.223-caliber bullets, duty use
About 8,000 to 10,000 rounds per year (unused rounds are replaced each year, and used for practice)
Price per case last year: $771
Price per case this year: $1,309

Regarding the ammo prices link above.
Anyone know how many rounds an officer fires for practice each year? Seems to me that firing this many new shells just for practice is pretty wasteful. If they rolled their own, they'd save a bunch of $$$....not to mention providing some redundancy in case of shortages and increased ballistic knowledge. Pretty wasteful, especially on 223. Do they recycle their brass at least?

All brass that gets fired in a range gets recycled (though cops are not allowed to pick up their spent shells - to make sure they never do that in a live fire situation).

It takes a LOT of practice with a gun before the public can trust you to use it, so the expense is justified.

That's sure not what I read on the blogs!
Lots of departments range-qualify their LEO's only once or twice a year:

WOW. Guess your link explains why some cops can't shoot straight under the best of circumstances and others are very proficent under the worst. I never would have imagined that there was such a variance among departments. I would have thought this would be a nationwide standard or atleast a FOP recommendation.

That being said, if its your chosen profession you owe it to yourself to do it to the best of your ability, even if it involves personal expense.

'A Turkish theater for World War III*'

This article could have been titled 'How the US is fast becoming irrelevant in the Mid East' or, pick your own. The House of Saud is positioning itself for the coming battle with Iran and is not looking for a lot of help from a weakening US.

...snip...'The age-old rivalry of the House of Saud with Turkey, which saw the overthrown of the Ottoman Empire from the lands of what is now Saudi territory, helps create enough energy and urgency for the latest Saudi enterprise. It is no mere coincidence that the Saudis need a functioning Sunni army to counter the likely expansionism of Iran, a matter that they simply cannot risk leaving to the putative next president of the United States, Democratic Senator Barrack Obama.'

'As the price of oil increased rapidly in the past three years, Saudi influence has grown. The rapid decline of the US into a credit crisis has also prompted the need for rich friends in high places, particularly to rescue moribund banks and continue buying bonds issued by bankrupt federal agencies. It now appears that instead of a share of US banks or its corporate that "lesser" Arab rulers may be happy with, Saudi Arabia has been slowly pushing the US to capitulate its Turkish fiefdom.

After stabilizing the Islamist government, the true costs of this bargain for Turkey will become more visible. As the US Army plans to leave Iraq, it will leave in its wake an independence-seeking if not functionally autonomous Kurdistan that embraces territory in the north of Iraq and Iran as well as the eastern part of Turkey. On its western front, Turkey has already been outmaneuvered by Greece on its claims on Cyprus by using the illusory carrot of potential European Union membership.'...snip...

Oops, here is the link to the above post:


Wow!! A minus rating for just posting a link!

Rating systems seem to always boil down to popularity contests. I'm not sure how to make it work better. The Slashdot system seems a bit more steady, but then I have no idea what I'm missing since I browse at a certain level.

As an experiment, change your user name and then see if you get the same number of baddies.

Karlof1, TstreeT, Sgage, anyone that lets their posts be effected by a stupid ratings system is caving in to the popularity contest.

The ratings system is designed to encourage all posters to 'sing in the same key', ie, PO is here, it is now, if you don't believe this you don't belong here. To question the wisdom(?) of Darwinian is to receive a deluge of downratings. To question WT is even worse, blah, blah, blee, blee.

Is that really the kind of site that TOD wants to become, has become? If no one posts anything other than 'received wisdom' then the site has become Animal Farm made real. TOD would become just one more ideological site...Hey, might as well visit an evangelical site or a site for the mentally impaired.

I do not care if my posts are downrated but I would care very much if for a moment I compromised my posts to garner upratings. I will continue to post that which I deem relevant to PO and retain my self respect regardless of how some moronic rating system grades them. I am too old to worry about what people that do not understand the value of debate think about me.

I am glad that my post re: The aims of SA and the ever declining role of the US in the ME garnered some comments...and I read the comments. To post that which is though provoking is what is important, not which arrow some moron clicks.

That's the problem with the rating system. River has a thing against Darwinian and people are punishing him by giving a negative rating to a good article.
BTW I like the majority of what River and Darwinian post, I just don't get the feud.

For some reason, The Asia Times has some writers who have it in for Turkey's AKP, the closest thing they've had to a democratic political party. So if the secular, pro-US army tries to have its judicial proxy ban an elected party that has done a better job running the place than any of the other parties, we're all told that this is a victory for freedom. Screw that.

Maybe the Turks like being Moslems. Is that a possibility?

Actually, the author is taking a shot at the Saudi's as shown by his thesis: "... recent events will conspire to push Turkey in the direction of Pakistan; into becoming a breeding ground for a new class of Islamic militants. The transition of Turkey into a new front for Saudi interests will follow typical ideological, strategic and political trends."

The ultimate nightmare of the neocon is the development of Moslems into all the forms of politics seen in real democracies: economic populists (not unlike the AKP), socialists, anti-imperial conservatives, etc. Then they would be Europeans, leaving us all alone as warmongering religious fanatics.

As for the Saudis, their stooges must be judged on their own merits; when they back a rich minority Sunni population as in Lebanon the results will likely be bad, when they back a broad-based populist party like in Turkey the results could be very good for everyone. Their guy Sharif in Pakistan is too mysterious to call. I don't think the Saud family wants to create Bin Ladens everywhere, it's bad for business.

Not so long ago, one of Saudi's foreign policy goals was to push the Wahhabbism brand of Islam on to other Muslim countries, as is pointed out by Rashid in his book about the Taliban and in The Battle for Saudi Arabia by Abukhalil, which is where the proliferation of "Islamic extremism" originated. A major change in policy seems to have happened now that Abdullah is completely in charge. And I would add that the Saud family didn't create bin-Laden, the US Empire did.

Hello TODers,

Here is a good info roundup of the I-NPK* news for any TOD newbies unfamiliar with my previous postings:

Discussion of various nutrients

The resulting tight fertilizer supply/demand fundamentals impacted all three nutrients in the quarter, and were clearly evident in higher product prices.

First, in potash, inventories were reduced to historically low levels around the world. For example, reported North American producer inventories were 41 percent below the previous five-year average at the end of June, an extremely low level given upcoming summer maintenance shutdowns. Global demand remains unsatisfied, even without considering the protracted contract settlements that left China approximately 3 million tonnes short of previously expected 2008 potash requirements.

Global nitrogen and phosphate supply was impacted in the second quarter by China, the world's largest urea exporter and second-largest phosphate exporter in 2007. China introduced a 35 percent tax on phosphate and nitrogen exports during the first quarter to protect its domestic supply, and then raised it to 135 percent effective from April 20 to September 30, 2008. Phosphate supply tightened further in May when a severe earthquake struck Sichuan Province, which produces 11 percent of China's phosphate rock and a significant amount of related downstream fertilizer, feed and industrial products.

In nitrogen, while higher global costs for oil and natural gas supported higher product prices and generally restricted product movement to regions relatively close to the source of production, the Chinese export tax immediately and significantly drove world urea prices higher.

Input cost data

Phosphate producers without an integrated supply of phosphate rock continued to be affected by rising costs for key inputs. The price of rock from Morocco rose to $350-$400 per tonne, compared to $190 in the first quarter of 2008 and $56 in last year's second quarter.
Delivered sulfur prices rose to $800 per tonne or higher in China and India, while US molten sulfur prices increased $200 per long ton from the first quarter of 2008.
Have you hugged your bag of NPK today?

*I-NPK = Industrial fertilizers = mined, then beneficiated P & K ores plus Haber-Bosch natgas Nitrogen products

O-NPK = Organic fertilizers = compost, manures, guano, etc

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

Reading Richard Heinberg's 'Peak Everything'. Rather than a Peak Oil Book (for beginners)this is a series of essays that have been previously published, a sort of Best Of R.H.

The essay "Tools With A Life Of Their Own" starts out with an admission that although Heinberg had been a critic of technology all through the nineties he had never mentioned "the ghost in the machine" "energy" until the current decade.

"It's the Energy Silly
What does it take to enable these techno-miracles? It takes 85 million barrells of oil per day globally, as well as millions of tons of coal and billions of cubic feet of natural gas. The supply network for these fuels is globe-spanning and awesome. Yet, from the standpoint of the end user, this network is practically invisible and easily taken for granted. We flip the switch, pump the gas, or turn up the thermostat with hardly a thought to the processes of extraction we draw upon, or the environmental horrors they entail."

Heinberg really is the poet of Peak Oil. We're lucky to have him.

"How I Started Writing and Learned to Accept Peak Oil" :-)


I wonder if we could run with this idea and get more people to accept the implications of Peak Oil? Maybe the technique could be incorporated into something like a party game or as a participatory part of a lecture or presentation?
We have all seen the defensiveness that rears up when we try to discuss Peak Oil with our nearest and dearest. Anything that can help get people past this hurdle is worthwhile to do.

I suspect this article on the sidebar is more relevant...

Positive Thinking Leads To Irresponsibility

Looking on the bright side can lead to irresponsible financial behavior, reveals an article in the Journal of Consumer Research.

Boy, if that isn't a title that can be taken a few hundred different ways..

'Positive Thinking' as in Antidoomer, Dr. ML King, Shirley Temple .. which of these?

Ahh, ok.. "Elizabeth Cowley (University of Sydney) examines repeat gambling in the face of loss."

or as Dumb and Dumber put it..

[Jim Carrey]: "What are the chances of a guy like you and a girl like me? One in a thousand?"

[Lauren Holly]: "Um, more like one in a million."

[Jim Carrey]: "So you're saying there's a chance!"

or perhaps a little closer to the bone,

"For scientific leadership, give me Scott; for swift and efficient travel, Amundsen; but when you are in a hopeless situation, when there seems to be no way out, get on your knees and pray for Shackleton." - Sir Raymond Priestley.

Ok, I'm off to get a sense of humor now..

The fuel situation in India gets progressively worse.

Diesel shortages in Bangalore this time: http://timesofindia.indiatimes.com/Cities/Power_cuts_fuel_shortage_of_di...

The power supply in Bangalore is so bad that most businesses need diesel generators even in "normal" times. With power now being rationed, businesses need additional diesel for their generator sets.

Until now, the public has been assuming that the fuel situation would resolve itself soon. The realization is probably beginning to sink in that it won't....

With wind being unreliable in this part of India, The only solution I can see is for businesses to start adopting solar power in a big way. I think IT companies will have to take the lead in this matter.

In the latest from Whipple, The peak oil crisis: America's electricity he seems to have forgotten the son of the gorilla: while there is enough electricity under BAU assumptions (plus economic slowdown), he didn't factor in the effect of much higher prices of heating fuels. That will spur some people, especially in the Northeast US, to shift to electricity for heating, which will easily topple the grid - at the worst possible time (dead of winter). Be prepared!

At least heat load comes at night, when there is generally a lot of spare capacity.

I also expect we'll see a shift in housing, with more foreclosures up East and more people moving a little further South.

Hi Paleocon,

With the exception of Ontario Hydro, all Canadian utilities are winter peaking and generally record their highest demand in the early evening hours, as street lights start coming on and folks arrive home from work, turn up their thermostats and prepare their evening meal.

Nova Scotia Power's '07/08 hourly load reports for the months of December, January and February can be viewed at:


In quickly scanning these tables, it appears our winter peak fall between 20h00 and 21h00 (roughly 25 per cent of provincial homes are electrically heated).

Interestingly, neighbouring New Brunswick has a much higher penetration of electric heat (56% of all homes) and experiences more extreme temperatures, and their winter peak generally occurs either around 08h00 in the morning or 17h00 in the evening.


Thanks, I stand corrected. That is not a good thing..........

Topple the grid? Not if:

1. All electric heaters are replaced by efficient air heat pumps. Leaves plenty for new electric heaters, which, of course, should also be efficient heat pumps. Resistance heaters should not be standard for wholesale heating; just for emergency heating only. Even if, in a pinch, oil is used as electricity generation (slim chance) then modern 50% net electrical efficiency oil fired generators and 10% electric T&D losses, fed into a heat pump with a COP of 3 on average, gives 135% efficiency equivalent. Oil fired heaters could never do better than 100%. So there's an advantage even then.
2. End use thermal energy store to take huge loads of the grid, effectively allowing large amounts of load following. Ice storage/chilled water for summer AC (those dandy high efficiency air heat pumps can do efficient cooling as well). Heat up that water thermal store during the winter for diurnal storage.

If aggressive policy is in place to make this happen FAST, then this will actually improve the overall reliability of grids, at a very acceptable cost.

I'm not talking policy and long-term rationality. I'm talking about people who are shivering and can't afford a refill of the heating oil tank. Plug-in resistive space heaters are cheap. Heat pumps are totally out of these peoples' realm. They're still in debt from last winter's heating bills, and since then the price of heating oil has doubled again.

And BTW, here in Vermont in the winter we need heat during the daytime too. And in winter the night time is probably the peak-electricity-demand time anyway.

You haven't really read my comment. Plugin resistance heaters are cheap? That's why the gov't has to step in with legislation that prohibits resistance heaters as standard heating for homes. Air heat pumps aren't that expensive; with 3x less electric use compared to resistance heaters, payback is pretty fast. With a 50% gov't rebate, it's a no brainer. The gov't frees up this money by not having to subsidize new generation and electrical infrastructure. Utilities can pay consumers for responsive load which easily offsets the costs of thermal storage; plus, the thermal storage will allow lower average electric rates. The thermal storage thing solves the diurnal variation in heating demand you mention. You're not telling me that people can't get a couple thousand USD private loan; they wouldn't be allowed to even rent a residence if their credit would be that bad.

This isn't long term rationality. We can start now and finish before 2020.

Hi Cyril,

VT's concerns are well founded. The vast majority of families in rural New England and Atlantic Canada would be considered working poor -- most live at or below the poverty line and could ill-afford to take on additional debt even under the most generous of terms. Almost every home has one or more electric space heaters and they'll be pressed into service by those who cannot afford to pay $1,000.00 or more to fill their tank. Of course, they won't be able to pay a $500.00 or $600.00 a month electric bill either -- it's a desperate act committed by desperate people.


His concerns were well founded, but he's wrong about people not being able to get the money for an air heat pump. The lifecycle costs are lower than electric resistance heating even with high interest rates. This means that a poor family will improve their future credit rating by getting a loan to pay for the air heat pump.

There's one particularly cost effective method of heating the home. 350 bucks if you do it yourself:


This provides most of a building's space heating. Should be great especially for the rural families.

Of course, not all of this could be done in a year, but that's no reason not to get started seriously. I'd like to look a bit beyond that; shortsightedness is exactly what got us where we are right now with our energy conundrum.

Hi Cyril,

Nothing would please me more than to see heat pump technology more widely used, especially where it would free additional electrical capacity to be used elsewhere; there's also little doubt in my mind that the economics are sound and that cash flows would be net positive. It's just that there's a tremendous amount of ground to cover to get from point "A" to "B" and I question the speed at which we could move forward. The supply of these products is our first big hurdle; there are a limited number of plants that manufacture these products and from what I understand they're all running flat out to meet current world-wide demand.


Good point about production capacity. It looks like it's ramping up pretty impressively. The Solar Wall shouldn't be restrained by production though. 350 bucks DIY project. I've got a feeling that many of those rural families would be really good DIYs :)

Their credit wasn't bad when they bought or rented, but it is now.

Do air heat pumps work much below freezing? Not efficiently or well. Thermal storage takes room. Ground-source is expensive.

Long-term these things might be possible, but for this winter it will be rough. Insulation is the best investment, and gov't/utility sponsored home energy audits would seem helpful.

Hi Paleocon,

I was looking at some stats for Aroostook County, Maine earlier this evening. In 2003, 26.9% of those under the age of 18 lived below the poverty line and, likewise, 54.8% of those between the ages of 18 and 64, and a further 18.3% age 65 and over. Per capital income in that year was just $15,033.00, 35.2% of all households in the county earned less than $20,000.00 a year and 58.9% of all households earning less than $35,000.00 paid more than 35 per cent of their monthly income for housing.

Source: http://www.umaine.edu/MCSC/Research/HeaSocPol/Poverty/Aroostook.htm

Bear in mind this is a cold climate (even by Maine standards) and much of the housing stock is older and not well-insulated nor necessarily in the best of repair; it's not hard to imagine how a doubling of space heating costs would affect household budgets (over 80 per cent of Mainers heat with oil). A detailed housing profile can be found at http://www.infoplease.com/us/census/data/maine/housing.html There's no question about it; it's going to be a tough winter for a lot of folks here in the north-east.

In terms of their heating performance, a good quality ductless heat pump will perform well down to -10C or -15C and some of the more advanced inverter drive systems continue to operate down to -25C, which is really quite remarkable. The numbers will be notably better in coastal communities where winter temperatures are generally more moderate but even in places like Fort Kent, Caribou, and Presque Isle I would expect good results (you don't have to displace every last drop of fuel oil to be cost effective, just enough to make the initial investment worthwhile). For anyone who can afford one, it's one of the best investments I know.


Plus you can get low-cost hot water in the summer for free. The output drops as the temp goes down, and certainly some nights will get far colder than 0F. Still, it is a great option when it's not terribly vold.

I know that many houses have deferred maintenance on top of poor design and construction, and it's hard to come up with capital even if there is clear operational pay-back. I wrestle with that with my rent-houses, whether to invest in conservation and efficiency though I don't pay the utilities. The typical renter doesn't consider utility costs, so there is no reward for me though the benefit is clear. Collapsing these sorts of social/business knots would be a good role of gov't. Maybe renters will get more savvy as well, so a tight house earns premium rent.

Thermal storage takes room? When the utility pays nicely for the load following service, and when people actually get a lower average rate due to not having to buy at peak rates, many people (especially those poor families) may find they are willing to sacrifice some space for the thermal store...

Besides, those rural families have more space available (doesn't have to be in the house - many have big propane tanks outside, why not a big insulated water tank?)

Last winter, people were trying to heat their homes by turning their ovens on and leaving the door open, and/or turning the burners on with no pots on them. Someone in NYC burned down their apartment building that way.

It's been down a lot of late here in Maine. Bangor Hydro and CMP. That will continue to be the case until the citizens constitution a Militia - not the Guard - to chop down the out-of-state transmission lines and for the extractive payments to out-of-state corporations. The Constitution is not a suicide pact? Bullshit; that's exactly what it is for everyone except the wealthiest.

And then there is the shortage of loggers to harvest the forests....

cfm in Gray, ME

Companies can't make money at triple digit oil prices? Of course they can. Just pass it on to the consumer. 100 bucks more for a multi thousand dollar vacation isn't going to stop people from going on jet vacations. I got back from Hong Kong early this month. Spent over 3000 USD. Think I care about a 3% price increase?

From what I understand, the problem is more with signed contracts that underestimated oil price excursions, that are now hurting business models.

You are in a different league than I am.

We cancelled our vacation this year, an annual driving trip to the beach, due in part to high gas, grocery, and hotel prices (we rent a condo for a week but need to stay overnight coming and going), but also because the money could be much better spent on other things at home which are also more expensive this year.

Of course, gas is up much more than 3% over last year. Right now everyone here is celebrating because it's "only" $3.95 where as last week it was "over $4"

(rolls eyes)

Hmm, long distance travel has always been expensive, suggesting inelastic demand to rising fuel prices. Your story also shows the inelasticity of oil in general, which is one of the major reasons why oil prices can fluctuate so strongly.

Rising gas prices don't hurt me at the pump. I'm totally sold to light rail :)

Of course, high oil prices are noticable in many areas besides transportation :(

The details of the personal automobiles of the five oil executives that testified
before Congress with full registrations


They probably buy SUVs because of the exemption from the limited depreciation allowed for fuel efficient vehicles. I am surprised that Congress has not received any flack for encouraging the proliferation of SUVs. I am an accountant and I cannot tell you how many clients bought SUVs for the write off. I would always say, "well, yes you do get the write off, but depreciation is a timing issue and you will pay more for gas than you will benefit from the early write off." The response is always the same, "I don't care about gas, I want my tax deduciton now."

So, I buy oil stocks and drive a crappy old car.

But ouch, my Acergy is way down. I would have thought it would be flying from all the discussion of offshore drilling.

Even Conoco Phillips is sucking wind.

How many hear believe GWB's political stunt of offering up his opinion on the economy "when the cameras" are off...and we get it on youtube instead.


Look for ex-pres Bush to be on youtube a lot!

It's interesting to see that there seems to me that there is a large population who think the economy is only having a hangover and we can get through it via the hair of the dog!

Taking in the evening news...and I have a question. Has anyone seriously schooled this Kudlow dude on what drill drill drill really means? Who do you think best to pit against Kudlow and Co? And tbey have to let the person talk. And they have to listen.

Big news today from the Teamsters

Hoffa Rejects 'Drilling Our Way Out' of Energy Crisis, Demands Long-Term Policy Solutions

Looks like this Hoffa is gonna go where the last one went.
Where ever that was.

Gotta hand it to this Hoffa family...they got
cannoli's and arent afraid to tell it like they see it.

The difference between an America insurance actuary and
a Sicilian insurance actuary is the American will tell
you how many of the insured will die and the Sicilain
will tell you how many and who they are and how they
will die.<-----Old Sicilian saying

Sorry if this wasn't clear from the headline, but the Teamsters pulled out of the ANWR Coaltion, a pro-drilling organization.

There were reports online that Russia has surpassed Germany in terms of auto sales and is now Europe's largest auto market.

One unconfirmed report seeming to originate from within Russia indicates auto sales surging at a much higher rate than Chinese auto sales.


Am not sure if the Russians will be able to maintain export growth if in fact auto sales will grow at a double digit rate while the forecasts for production growth made by Putin this year were optimistically calling for 5% growth per annum this year and next, while first quarter 2008 production dropped. It is true they have Arctic and Eastern Siberian frontiers, including large offshore undeveloped resources, but their recent auto sales growth trends vastly exceed short term development forecasts.

Hello TODers,

Two interesting articles popped up on the page today:

The first news article makes explicit mention of the effect that high gas prices are having on a home buyer's decisions. The increasing costs of a contemporary suburban life style may indeed be starting to be questioned by the members of the middle class. Large house, large car, long drive, and an energy intensive lifestyle may be easy to maintain in a time of cheap energy. As energy prices rise, and as the increased prices work their way through the economic system, discretionary income is being reduced. More and more often people seem to be talking about cutting back and or reevaluating their lifestyle.

I wonder. On one side of the coin, high energy prices in a free market will result in folk making individual decisions that have the effect of reducing the collective energy demand of society. On the other side of the coin, the government can take actions, such as changing the CAFE standard or awarding energy star ratings to appliances, to force or drive a reduction in the collective energy demand. The former includes pain for the consumer. The latter is viewed by some people as a restriction of individual freedoms. Which is better, governmental mandates for the good of all or individual pain?

One of the articles mentions that Townships and cities seem to be rethinking their development plans to include more local businesses in the hope that a broader business base will entice people to live in the town. This seems like beneficial, forward thinking on the part of the local government.

However, high gasoline prices seem to have done more for increasing the average fleet fuel economy than the higher CAFE standards (only time and the continuance of high prices will tell if the upward shift will be permanent). Due to apparent high consumer demand for more fuel efficient cars, Ford announced that they are finally going to start selling those nice little European cars in the US.

There is a downside to the free market approach -- many people do not have discretionary income that they can reallocate and are suffering hardship as they struggle to manage the increased costs. There may not be an easy, well balanced answer to the question. Adaption is not necessarily easy.

Having government mandate high energy efficiency throughout the economy comes under its mandate "to promote the general Welfare." Thus, one could argue it hasn't been doing its job for some time, especially when energy use per capita is compared between OECD countries where most are 50% more efficient than the USA. The housing bubble created by Greenspan/BushCo and what I call the Greed/Debt Bomb that's been gestating since Reagan/Bush and seems to have finally exploded too were also the result of closely intertwined government and business policies that were also sold to the public as "promot[ing] the general Welfare." As I imply, the "free market" has not been involved at all. What has instead happened is a social engineering paradigm on a grand scale that's operated since the end of WW2 and is now failing because its underlying foundation--cheap fossil, and especially cheap transport, fuels--is no longer able to support the paradigm. To be sure, there are other related reasons for the paradigm's failure, a few I've mentioned above.

So my scenario for the USA, which your bio says you want to explore and discuss, is that of paradigm shift, a shift that may be more or less radical and surely disruptive as the transition time will be shorter than the previous much more milder shifts in energy-type paradigms, a point noted and emphasized by Hirsch in his report and subsequent speeches. The current self-inflicted financial strangulation afflicting the USA can be alleviated and monies thus provided to mitigate the effects of and help start the transition to the new paradigm by the wholesale rollback of the overseas US Empire, which will generate a Trillion dollars each year for the next several that would otherwise be wasted. The monies would be used in a Keynesian-type program of new industrial and infrastructure construction for non-fossil and non-nuclear electrical generation and new transportation formats that emphasize mass public transit. New agricultural production methods would also need to be put implace in tandem with repopulating the rural areas of the USA.

The above constitutes my solution to Peak Oil and Climate Change, which I've advocated for four odd years now. The brush strokes are broad, but the picture can easily be made more detailed. Its scope may be unprecedented, but we face an unprecedented collection of crises, and the road we are currently traveling is unacceptible and fraught with the danger of even more, and potentially nuclear, war.

Are you familiar with Earth Policy Institute's "Plan B"? But the price of saving our world would equal 1/3 of our military budget and hence is a non-starter.

But the ROI of energy efficiency is often much better than military ventures.

double post...

Hello TODers,

To get an idea of the cascading blowback effects of depletion in water, I-NPK, seeds, hoes, and FFs, plus a hefty dose of earlier machete' moshpit dance action:

KENYA: Fears of food shortages in the west

KAPSOKWONY, 24 July 2008 (IRIN) - Erratic rainfall, soaring farming costs, and a shortage of materials in the western district of Mt Elgon could compromise food security in the region.

..."Right now we are expecting four [90kg] bags of maize per acre instead of the usual 20 as we could not afford to use any fertiliser," Keya said.

..The cost of using ox-drawn ploughs had also gone up from KSh800 ($13.30) to KSh1,200 ($20) per acre of land.

...According to the district agricultural officer Sammy Cheminingwa, the acreage of the land under crop production in the district was 30 percent less than normal. "Most of the land was also prepared late because people had run away," Cheminingwa said.

...The district, one of the key grain-producing areas in western Kenya, normally has a surplus of 418,500 bags of maize for sale to neighbouring districts. Cheminingwa said the district cereal bank had been depleted.

...Phyllis Chesha, a returnee living at the Elgon Bible College in Kopsiro division, told IRIN she had not yet been able to plant any crops on her farm due to a lack of seeds.

..."We also do not have jembes [hoes] to help us prepare the land," Chesha said. A lack of shelter material was also preventing the returnees from settling back on their farms.
I found the rapid price rise in hiring oxen to be fascinating. My guess is that there are far too few oxen-teams for the available acreage. [Do oxen plow one day, then must be rested for the next two days to recuperate? Anybody know?]

Additionally, my guess is the current hoe shortage is due to the earlier fashioning of these into weapons for their earlier tribal whack-attacks.

Anyhow, this weblink above sadly illustrates what happens when no mitigation is planned for ahead of time. It would be fascinating to know what mileages and percentages of Kenyan goods are now transported Nuahtl Tlameme backpacking style. IMO, the next round of violence will be even worse. Such is life.

Please contrast the above versus with much of what I have suggested before to help optimize the Overshoot decline: Strategic stockpiles of bicycles, wheelbarrows, garden tools, I-NPK, seeds, and other biosolar essentials. Rapid ramping of O-NPK recycling using SpiderWebRiding and/or minitrains. These are all low-cost mitigation measures for a First World economy practising full-on Peak Outreach.

Time will tell.

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

Worldwide wind power generation is expected to grow from 1% of the world's electric production to 3% in 2012.


Currently windpower is profitable.

That Pat Boyle article really got my blood boiling. He/she claims that the 1970 peak in US oil production was forced by the governemnt, by banning drilling and capping production.

Never mind that there is no data that shows how much production was lost or delayed by these actions. Let's consider what would have happened if the govt didnt do those things. Any drilling that would have been done would have brought new production online much later, well after the peak. And if production wasnt slowed down, then we would have been hit even harder by the peak. I think we're lucky to have 5 mbpd today, so long after the US peak.