DrumBeat: July 28, 2008

Loans for automakers gain support in U.S. House

WASHINGTON -- Backers of a program that would lend up to $25 billion to automakers and auto parts suppliers said today they had garnered 71 U.S. House members to support their search for $3.75 billion in funding over the next couple of months.

The program, known as the Advanced Technology Vehicles Manufacturing Incentive Program, was meant to help automakers meet fuel economy standards of 35 miles per gallon by 2020. Created but not funded by Congress last year, the program would provide low-cost loans to cash-strapped automakers and their suppliers for engineering fuel-efficient vehicles or converting old plants.

Mexicans vote 'no' on oil reform; turnout far below expectations in nonbinding referendum

MEXICO CITY: Organizers of a nonbinding referendum say Mexico City residents voted against the president's proposal give private companies a bigger role the country's state-run oil industry.

More than 80 percent of those who voted Sunday in the capital oppose President Felipe Calderon's plan, according to results from nearly 98 percent of the vote.

A $16 Billion Problem

Few legal battles have been more exotic than the lawsuit tried over the past five years in a steamy jungle courtroom in Ecuador's Amazon rain forest. Brought by a group of U.S. trial lawyers on behalf of thousands of indigenous Indian peasants, the suit accuses Chevron of responsibility for the dumping (allegedly conducted by Texaco, which Chevron bought in 2001) of billions of gallons of toxic oil wastes into the region's rivers and streams. Activists describe the disaster as an Amazon Chernobyl. The plaintiffs—some suffering from cancer and physical deformities—have showed up in court in native garb, with painted faces and half naked. Chevron vigorously contests the charges and has denounced the entire proceeding as a "shakedown."

But this spring, events for Chevron took an ominous turn when a court-appointed expert recommended Chevron be required to pay between $8 billion and $16 billion to clean up the rain forest. Although it was not the final verdict, the figures sent shock waves through Chevron's corporate boardroom in San Ramon, Calif., and forced the company for the first time to disclose the issue to its shareholders. It has also now spawned an unusually high-powered battle in Washington between an army of Chevron lobbyists and a group of savvy plaintiff lawyers, one of whom has tapped a potent old schoolmate—Barack Obama.

Gas Price Follies

Add high energy prices to a sagging economy in an election year and politicians will inevitably come up with bad policies, like converting the corn crop into ethanol or John McCain’s proposal to suspend the federal gas tax — neither will provide real relief at the pump while both are guaranteed to create other problems.

Why might Alaskans favor Arctic drilling? A $2,000 check

JUNEAU — This year's Permanent Fund dividend check — what Alaskans receive each year from the state's oil-revenue investment fund — is likely to be more than $2,000, the first time since the state began making the payments in 1982 that the dividend has topped two grand.

Ethanol production soars, but its allure plummets

For the past quarter-century, U.S. energy policy has been generally non-existent. To the extent there has been one, it has been to keep gasoline cheap. But one element stands out as a dramatic exception to this minimalist approach. Through a series of generous tax subsidies and production mandates, the use of corn-based ethanol has soared.

Already, some 23% of the American corn crop goes into ethanol. In acreage, that's equivalent to the combined farm land of Pennsylvania, New York, New Jersey, Maryland and Delaware. In 14 years, under current federal mandates, about 40% of America's corn crop would be heading for its gas tanks.

The more and more ethanol that's produced, however, the less and less it looks like a solution.

U.S., China lead way in tapping wind power

LONDON, England (CNN) -- From Dallas, Texas to Dabancheng, China, energy companies are staking fortunes on harnessing wind power.

Fans of L.E.D.’s Say This Bulb’s Time Has Come

By lighting all of the building’s exterior and most of its interior with L.E.D.’s, Sentry spent $12,000 more than the $6,000 needed to light the facility with a mixture of incandescent and fluorescent bulbs. But using L.E.D.’s, the company is saving $7,000 a year in energy costs, will not need to change a bulb for 20 years and will recoup its additional investment in less than two years.

Economy hitting the elderly especially hard: Bankruptcies soar as retirees, agencies struggle to keep up with rising costs

Food prices and medical costs are still rising, tarnishing what are supposed to be the golden years for the elderly, perhaps the hardest-hit victims of the slumping economy.

Elderly Americans are filing for bankruptcy in record numbers, according to a study by AARP, formerly the American Association of Retired Persons. At the same time, support is drying up from meal, transportation and other home assistance agencies that can’t pay their own bills.

“There's no question that the downturn in the economy is dramatically impacting those at the doorstep of retirement and those that have already decided to retire,” said Mark Kitchens, a senior vice president of AARP.

The numbers are stark. Of the more than 1 million Americans who filed for bankruptcy last year, nearly a quarter were 55 and up, AARP found. Bankruptcy filings among those ages 75 to 84 skyrocketed by 433 percent from 1991 to 2007.

Charities suffer as donations diminish

Layoffs, foreclosures and higher gas and food prices are driving more people to turn to local charities for help.

But as demand for food, temporary shelter and other necessities has soared in recent months - by as much as 100 percent for some agencies - the economic downturn also has curbed giving. Local human service organizations report that donations from individuals and businesses have slowed more dramatically than normal during the historically low summer months.

Add rising fuel prices, and the problem intensifies, increasing nonprofits' operating costs and hindering their ability to recruit volunteers.

Australia: Supermarkets stockpile fresh food as truckies protest

SUPERMARKETS across Queensland are expected to run low on food tomorrow as angry truck drivers stand firm on their two-week strike.

Retailers, fearing the worst yesterday, started to stockpile fruit, vegetables and meat as thousands of truckies joined blockades to protest against low pay rates, new fatigue regulations and soaring fuel prices.

UK: Energy firms ‘conspire to raise prices’

Energy companies stand accused today of overcharging customers, leaving millions of households struggling to pay gas and electricity bills.

A report claims that the six biggest energy companies conspire to keep charges artificially high and gives a warning of widespread hardship this winter unless the Government acts.

New Zealand: Power shortages cost economy $3b

Business is licking its wounds as the country emerges from the winter of tight power supplies.

Lost production and the cost to some generators exposed to high wholesale prices to meet customer obligations will, according to previous dry year precedents, total hundreds of millions of dollars.

Concerns raised over Pacific’s capacity to cope disaster

The Pacific Regional Disaster Risk Management Meeting last week expressed deep concerns over the Pacific’s capacity to cope with disasters.

In a communiqué released yesterday, the participants say the high fuel prices - the global food shortage have a likely impact on the ability for the pacific nations to cope with natural disasters.

It adds the increasing impacts of climate change will further worsen the capacity especially in regard to response and recovery.

Russia EconMin sees stronger rouble, less oil

Klepach also told reporters the ministry had revised down its forecast for Russian oil production in 2008 to 492 million tonnes from 495-500 million tonnes predicted earlier.

Nigeria to ramp up oil exports by 14%

Nigeria, overtaken by Angola this year as Africa's biggest oil producer, is scheduled to increase daily crude exports by 14 percent in September.

Loading programs show Nigeria is scheduled to ship an average of about 1.88 million barrels a day, compared with a revised average of 1.65 million barrels a day in August. Total exports will climb to 56.3 million barrels from a revised 51.2 million barrels in August.

Firms squeeze the workweek

Ask Roberta Chinsky Matuson about compressing the workweek into four 10-hour days and her response is enthusiastic. "I would rather work four days than five," says Ms. Matuson, who once spent nearly nine months on a compressed schedule as a human resource director in Massachusetts.

Julie Lenzer Kirk, who has also worked a compressed week and has approved it for employees, offers another perspective. "When they're done right they can work well, but if they're not managed correctly they can be tough on the business," she says. "It can be more of a hassle than a blessing."

Their comments reflect the divergent viewpoints employees and employers hold as more companies adopt, or at least consider, alternative schedules. By squeezing five eight-hour days into four 10-hour days, workers save one day of commuting – a growing consideration as gas prices have soared.

UAE: Union Cement Q2 profit down

Union Cement Co posted a 60.2 percent drop in net profit in the second quarter on high raw material and fuel costs, as well as a sharp decline in income from investments in shares.

...Cementmakers in the United Arab Emirates are turning to imported coal as gas is scarce and a petrodollar-fuelled building boom shows no signs of letting up.

Pakistan: Rally slams power outages

OKARA: People held a protest demonstration against the Wapda for the long-hours load-shedding being conducted from 14 to 16 hours here in Okara and its environs.

Mexico's capital, 9 states vote on nation's oil industry

MEXICO CITY -- A bitter debate on how to rescue Mexico's troubled state-owned oil company went directly to the people Sunday as residents of the capital and nine states voted in a nonbinding referendum on President Felipe Calderon's plan to open some portions of the petroleum industry to outsiders.

Congress deadlocked over offshore drilling

Washington - As Congress heads into its last week before August recess and political conventions, there's one big item on the must-do list: Action to ease energy costs for American families.

With a gallon of gas hovering at $4, energy prices are the No. 1 issue on voters' minds. But congressional leaders are increasingly deadlocked over what to do. In response, frustrated rank-and-file members on both sides of the aisle are stepping up efforts to find common ground.

Ontario nuclear plant weld failure "unprecedented," documents show

OTTAWA -- When the Canadian Nuclear Safety Commission was struggling last December with a shortage of medical isotopes sparked by the Chalk River reactor shutdown, it was also dealing with another Ontario nuclear plant where there had been an "unprecedented" weld failure on one fuel bundle.

In all, 10 defective welds were found on the fuel bundle, a collection of processed uranium rods resembling the barrel of a Gatling gun about a half-metre long.

Small farming is the future

There's the rub -- feeding the world was never the intention. Back in the '70s well-meaning researchers and eager graduate students, myself included, were convinced we could eliminate hunger in our lifetime. We had good intentions, but the big picture was always about making a profit.

Farmers, using cheap fuel, fertilizer and plenty of chemicals, could plant more acres, produce enough volume and generally make a profit. This, of course, benefited the seed and chemical companies, which long ago figured out that small farmers saving their own seed and tending small acreages didn't spend much money.

Want guilt-free steak? Go against the grain

Instead of focusing on what you're eating, how about taking a look at what your prime rib had for lunch last week? Research is showing that beef from grass-fed cattle is leaner, healthier, and less costly to the planet — and may even be safer to eat than the heifers you're chewing on now.

Grocery wars: Whose belts are the tightest?

As you scuttle through the aisles of the grocery store looking for your favorite snacks, you probably experience some sticker shock: $8 for a pint of ice cream! Yes, food prices have gone up, and they’re going to keep climbing. Kind of like gas (and largely because of gas), everyone is shelling out more — but who’s being hit the hardest? Vegans? Regular ol’ omnivores? Or are we all in equal-opportunity Sufferville?

NEPAL: Fuel shortage threat to food security

KATHMANDU (IRIN) - Nepal's acute fuel shortage is causing serious concern among local food traders about its impact on food prices.

"The shortage of fuel has been affecting the cost of our transportation. We can expect further increases in food prices which could heavily affect poor families," Ravi Sharma, a local food trader, who supplies rice and other food from the Terai region (fertile plains of southern Nepal) to the hill areas of the country, told IRIN in the capital.

Funds for Highways Plummet As Drivers Cut Gasoline Use

An unprecedented cutback in driving is slashing the funds available to rebuild the nation's aging highway system and expand mass-transit options, underscoring the economic impact of high gasoline prices. The resulting financial strain is touching off a political battle over government priorities in a new era of expensive oil.

A report to be released Monday by the Transportation Department shows that over the past seven months, Americans have reduced their driving by more than 40 billion miles. Because of high gasoline prices, they drove 3.7% fewer miles in May than they did a year earlier, the report says, more than double the 1.8% drop-off seen in April.

Saudi Aramco denies shortage of fuel to rural areas

DHAHRAN – Saudi Aramco said, Sunday, it has not received any complaints from clients about shortages of its products in any local market. The statement comes after farmers have complained that diesel has been undersupplied to the rural regions of the Kingdom.

Farmers complained of their crops being in danger of drying up because they could not acquire diesel for their water pumps to irrigate the fields. Truck drivers also complained of shortages at filling stations in June.

Arroyo rejects calls to scrap sales tax in Philippines

She said her government would maintain a 12 percent value-added tax on oil, the proceeds of which she said would go to funding projects for the poor.

'Take away VAT and you and I abdicate our responsibility as leaders and pull the rug from our present and future progress,' Arroyo said. 'Take away VAT and we strip our people of the means to ride out the world food and energy crisis.'

Saudi Aramco to sell 41 pct more crude oil to Sinopec this year

BEIJING (XFN-ASIA) - Saudi Aramco is expected to sell 41 pct more crude oil to China Petroleum & Chemical Corp (Sinopec) this year, the official China Daily reported.

Mohammed Al-Madi, regional vice-president and chief representative of Saudi Aramco in Beijing, was quoted as saying that Saudi Aramco is looking to deliver 32.4 mln tons of crude, equivalent to 650,000 barrels per day, to Sinopec, compared with nearly 23 mln tons in 2007.

The Saudi company expects to increase exports to 1 mln bpd by 2010 and 1.5 mln bpd by 2015, he said.

Contemplating Nigeria’s Future

The state authoritarian tactics in handling the festering crisis over environmental degradation, underdevelopment, resource control against the advice of its general staff to the effect that it is a political problem, which requires a political solution and not military, could lead to an all out war that might unhinge the huge joke called Nigeria.

Interview with Nick Barisheff: Gold is Money

The issue of Peak Oil – it used to be a debate as to when the production of oil would peak. Now it looks like that has already happened, in March 2006. As a result we have a situation where oil production is declining while demand is increasing, particularly from India and China. This will result in ever-increasing oil prices, and also increasing prices for almost every product and service.

As these two forces – increased money printing and peak oil – interact, the result is a declining dollar alongside constantly increasing oil prices. This leads to even greater oil price increases in an effort to offset the dollar decline. These two highly inflationary factors are working in tandem, and they can’t be changed.

China's Cars, Accelerating A Global Demand for Fuel

"In China, size matters," says Zhang, the 44-year-old founder of a media and graphic design company. "People want to have a car that shows off their status in society. No one wants to buy small."

Zhang grasps the wheels of his Hummer, called "hanma" or "fierce horse" in Chinese, and hits the accelerator.

Car ownership in China is exploding, and it's not only cars but also sport-utility vehicles, pickup trucks and other gas-guzzling rides. Elsewhere in the world, the popularity of these vehicles has tumbled as the cost of oil has soared. But in China, the number of SUVs sold rose 43 percent in May compared with the previous year, and full-size sedans were up 15 percent. Indeed, China's demand for gas is much of the reason for the dramatic run-up in global oil prices.

China alone accounts for about 40 percent of the world's recent increase in demand for oil, burning through twice as much now as it did a decade ago. Fifteen years ago, there were almost no private cars in the country. By the end of last year, the number had reached 15.2 million.

Public resists Beijing efforts to clear the air

BEIJING — Wang Hao knows that the air in Beijing still needs to get a lot cleaner before the Olympics start in fewer than two weeks.

Yet he won't apologize for paying $12,000 for a second car. The purchase allows him to avoid the city's tough anti-smog restrictions, which ban half of the city's vehicles from the roads on alternate days until the Games are over.

"Of course taking the subway is more environmentally friendly," says Wang, a car salesman. "But it's not convenient."

Gas: Under $4 a gallon and falling

NEW YORK (CNNMoney.com) -- Gas prices declined for the 11th straight day on Monday, falling to a level not seen since May, according to a nationwide survey of filling station credit card swipes. Other fuel prices also continued to fall.

Nigeria militants attack oil pipelines

ABUJA (Reuters) - Militants in Nigeria's Niger Delta said on Monday they had attacked two major oil pipelines belonging to Royal Dutch Shell, forcing the firm to halt some production and helping push world oil prices higher.

'Blood oil' dripping from Nigeria

Under cover of night dozens of barges queue up to dock at a jetty in a creek somewhere in Nigeria's oil-rich Niger Delta.

Their holds are filled with stolen oil running from valves illegally installed into a pipeline.

No more cheap energy: How do we end fuel poverty?

By any standards, 20% is no small price rise. But according to EDF Energy, this was what was needed for it to keep up with its own sky-high costs.

It is moves like this, compounding rising household costs that are pushing more and more people into poverty, that prompted a committee of MPs to investigate the big energy companies.

The resulting report not surprisingly states that the era of cheap energy is behind us. It warns: ‘Expect gas and electricity bills for domestic consumers to rise significantly in the near future, over and above the increases already announced this year, with serious consequences for millions of households, and especially the fuel poor.’

Ryanair Profit Falls 85% on Oil; May Post Annual Loss

(Bloomberg) -- Ryanair Holdings Plc, Europe's biggest discount airline, said profit fell 85 percent, missing analysts' estimates, and may post its first full-year loss since going public in 1997 because of increased fuel expenses.

Hedge Funds May Post Worst Month in 5 Years as Bank Bets Sour

(Bloomberg) -- Hedge funds may post their worst month in at least five years after bets on financial stocks falling and on crude oil rising backfired.

Toyota cuts global sales outlook

"The main reason for the change came from the faltering U.S. economy, and how rising oil prices and material costs are dampening the market there overall," said Toyota spokeswoman Kayo Doi.

The Japanese and western European markets were also sluggish, but Toyota's solid sales in China, the Middle East and other markets were enough to maintain its worldwide growth, she said.

Will clotheslines turn dryers into relics?

In my most rich environmentalist fantasies I am off the grid, self-sufficiently solar. In real life I'm still on the grid because I'm not rich.

But even in real life with a budget, my family and I have scored big with one simple lifestyle change — we hang dry all of our laundry. It has reduced our power bill, and turned us, like converts to a new faith, into proselytizers.

Man hurt in fuel-making explosion

A man blew up his garage attempting to make biodiesel from cooking oil at his Northamptonshire home.

The victim received 20% burns when his makeshift garage factory, in Middleton Cheney, exploded on Saturday afternoon.

Oil bogeyman approach won't reduce emissions

AUSTRALIAN motorists have been frightened into greenhouse submission. A shocking CSIRO report issued earlier this month warns of petrol prices of up to $8 a litre by 2018.

There are few buttons hotter than petrol prices to get public attention on the future cost and availability of transport energy.

The eye-watering projection of a 500 per cent increase in petrol prices is based on one small section of the Fuel for Thought report, which models a doomsday scenario of imagining if the exhaustion of the world's oil reserves peak oil was already upon us.

Kyoto, city against global warming, sees threat to gardens

KYOTO, Japan (AFP) - Kyoto, the city whose name is synonymous with the fight against global warming, is feeling the effects of climate change first-hand as the moss dries out in its celebrated gardens.

Here's one that relates to what we spoke of last week, returning to canals for transportation:

Gig by Gig on the Erie Canal: No Gas. No Mule.

Most did not know the musician, Christopher Bell. But they had an idea about how he got there. Mr. Bell had paddled into town in his one-man canoe — a ukulele, 11 harmonicas, some energy bars and a few pieces of clothing stowed in the canoe’s crevices. “This is my attempt to stave off gas prices for six weeks and still go to work,” he said to the audience.

Mr. Bell, 22, of Frewsburg, near Jamestown, is on a summer tour across New York State. He started his tour from Buffalo on July 20, and plans to canoe 550 miles to New York City in time for a performance at a coffee shop in Manhattan on Sept. 4. Along the way, he is performing in small towns like Brockport, as well as in larger cities such as Rochester, Albany and Poughkeepsie.

For a long time I thought that the nearly zero cost of distribution of music on the internet (illegally) would put an end to the music industry as we know it and favor more local musicians or lower profile ones. Well, maybe gas prices will do the same thing. Less income for musicians and fewer people willing to use their disposable income on a high-priced concert.

Thanks for finding this from a lifelong resident of the Great Lakes basin and current resident of western NY. I have been saying for a couple years now that the Erie Canal is going to be a great asset for NY state going forward.

The local Rochester, NY newspaper also had an article about increasing use of the Erie Canal going forward:

Western Monroe County Communities Hope to Build Future with Erie Canal



Damn Chinese. Who the hell do they think they are, burning up our gasoline?

I'm sure that someone has already started buying up cheap used SUV's in the US and shipping them overseas. BTW, an articles in the NYT about fuel subsidies:


Of course, relative to Europe, one could argue that the US is, in effect, subsidizing energy prices--which is a key reason that our total energy consumption per capita is twice what it is in Europe.

The article also had this bombshell in it:

The oil company BP, known for thorough statistical analysis of energy markets, estimates that countries with subsidies accounted for 96 percent of the world’s increase in oil use last year — growth that has helped drive prices to record levels.

Subsidies are a remarkably efficient way to boost consumption, but what is interesting is how oblivious, until recently at least, most of the media have been to rising consumption in exporting countries. A What If scenario for Saudi Arabia, assuming a flat production rate of 11 mbpd and extrapolating their consumption at +5.7%/year (the latest EIA data show a +7.2%/year rate of increase):

However, once an exporting region starts showing lower production, recent case histories suggest that the rate of change in consumption only changes the slope of the net export decline rate, e.g., the UK went to zero net oil exports in seven years with a minimal increase in consumption of +0.2%/year.

...The whole Middle East will 'go nuclear' b4 those lines cross -the only variable being the speed of the energy released...


To get a sense of the historical rise in consumption in developing nations you should review the graphs of the Energy Export Databrowser. Those producing nations that subsidize oil consumption have shown dramatic increases in consumption over the last couple of decades. (The Export Land Model in action!) Check out the plots for:

  • Indonesia
  • Egypt
  • Malaysia
  • Mexico

Here is Indonesia:

Then take a look at the producing nations of the Persian Gulf. The oil consumption is up but their consumption of natural gas is WAAYYY!!! up.

The case of the UK is an object lesson in how quickly resources that are fully developed can decline. If you look at the graph for UK Oil Exports/Imports in units of constant dollars, you'll see that they made a grave mistake in exporting largely during periods of cheap oil and returning to imports during the current period of high prices. (A mistake reminiscent of the Bank of England's selling off the national gold reserve during (and contributing to) the lowest inflation-adjusted prices of the century.)

I don't know if you saw this a couple of days ago, but here is a link to a presentation I gave at Sandia Labs on our net export work:


Nice presentation and thanks for passing it on. Are all of the forecasts based on HL analysis?

Yes. Khebab basically did a low case, middle case and high case for production declines, using HL, and he used a Monte Carlo analysis for future consumption, again generating low case, middle case and high case scenarios. He then generated three predicted net export curves showing worst case, middle case and best case for net oil exports approaching zero.

If we sum the top five together, volumetrically they are currently on track to approach zero net oil exports around 2031, which is the middle case scenario in the quantitative analysis.


If you use Firefox 3 do not under any circumstance download the recommended plugin as it is not compatible (it was designed for firefox 2) and will almost certainly break things. I'm still manually undoing the mess it made. At one point I had to pull the plug on the machine as an infinite number of windows tried to pop up with unintelligble (to anyone other than the programmer) error messages.

Answer Yes to continue without plugin with Firefox 3(there actually is a plugin handling this already). That should work and you should see the synchronised slideshow in another frame. If not use IE :-(

Thanks for the info. There have been some scattered reports of problems.

It seems to be the old windows "dll hell" problem where you end up with multiple different versions of code libraries installed in multiple locations depending on what you have previously installed. Firefox 3 only came out recently and not every website/plugin/addon is fully compatible yet - some reviewers have suggested Mozilla jumped the gun with this release (I've had far more annoyances with this upgrade than any previous Firefox upgrade).

[Edit: On a technical note I think it's the detection/installation program that makes a mistake. WMP11/Firefox 3 users should already have a suitable np-mswmp.dll - your mileage may vary :-)]

I'm running Firefox 3 and did not download the plug-in. I can see the slides, but see no video. Is there a way this can be saved in some other format? Much appreciated, if possible to convert it to another format.

If you're not using Windows Media Player 11 then upgrading to that should work.

Howver here's a direct URL for the video stream which should work for everyone. This should fire up in external windows media player no matter what you are running. Should work on other operating systems too if you are having problems.


I had to use tinyurl because the posting software won't let me post the full url as a link (it converts mms to http which doesn't work)

The actual address of the video to which the tinyurl points is


with the wrapping removed for the technically inclined.

That rating system doesn't seem to be working for me, but thanks again. It's wonderful.

Here's a zip file (only 2.2MB) http://www.savefile.com/files/1695621 containg all the slides plus their starting time index (in file texas.txt). The video is 350MB long as provided so I haven't uploaded that but you can download it directly with (for example) mplayer using the command:

C:\mp2\mplayer>mplayer -dumpstream -dumpfile texas.wmv mms://as04snlnto.son.sandia.gov/mediasite/44148de6-159c-468f-b4ac-0b2490591d15.wmv

Using this combination you'll get the video and slides stored locally should anyone wish.

Also I think it may be the case that if you are running a version of Windows Media Player prior to V11 with Firefox 3 it may be ok to download a recommended plugin - however I haven't tested this as I'm running WMP V11.


That was excellent.


It took me a while to steel myself to actually watch the presentation, but I do think it was the best one I have given. It might have had something to do with the audience. It was a group--at Sandia Labs with video links to two other national labs--that I didn't want to disappoint in any way (I've also had lots of practice lately).

Excellent job. I've read all of these arguments from you before in snippets here and there, but to see the entire presentation is quite impressive. There were good questions from the audience also.

One fellow asked about the effect of acts of terrorism on export rates. I think Mr. Vail's observations are that as energy prices become more expensive, the payback for energy saboteurs increases. Increased attacks on energy sources further drive higher prices leading to an even greater ROI for sabotage. This feedback loop is one that I'm afraid will play a greater role in driving energy costs.

About the tax increase on energy and reduction of the payroll tax, Gore has the killer bumper sticker line: "We should be taxed for what we burn, not for what we earn."

Thanks very much for making it available; I sent it to a number of people who otherwise might not have seen it (that don't read here).

I'm running XP, Firefox 3, didn't have a message to download and it seemed to work fine. I really liked the video and the slides working together in tandem vs. the usual power point without the full explanations that the presentation offers.

I'll second that (or third or fourth it). Great to see you getting the message out.

Yes, Great Presentation-->Big Kudos to Westexas!!!

Go,go,go Alan Drake! We really need to start building RRs & TODevelopment ASAP!

Good Morning from Melbourne, Australia.

It WAS 1am. Wife had been snoring, dog growling at a possum outside. Earplugs not working. Brain refuses to shutdown. Now it's 2.30am. Wife's quiet, dog's asleep... But why on earth did I start your one hour presentation?!

I guess the main question I keep asking myself, if your models are to be believed (as a PO newbie with an average IQ, I struggle a bit with the black dots more or less trending up, followed by a nose-diving blue line - I'm sure many of my fellow Average Joes and Janes would also), is how long do we have?* I read here often that many Todsters believe BAU will begin a rapid shutdown in less than a decade. But how can I tell family and friends that? I can't even accept it!

Dang, I was just starting to enjoy this mid-life thing.

* Factor in also that our city is basically one huge suburb of three million people, with a very poor rail service and little hope of political improvement to it in the forseeable future.

Regards, Matt B
Oh well, back to bed... Sweet dreams or nightmares?

The key characteristic of our simple model, several case histories and ongoing regional and world data is that it shows an accelerating net export decline rate. I expect to see a continued accelerating rate of decline in world net oil exports, which is why I always finish with a strong push for Alan Drake's plans.

Alan Drake's plans are suitable for urban areas, but are of little use for rural and small town areas. This urban/rural conflict is holding up progress.

When ethanol is rejected and only one solution that may suit urban areas is imposed there is going to be resistance from rural areas since they do not see any benefit.

A questioner asked about the percentage of liquid energy use that ethanol would be if all corn were converted to it. This implies that total liquid energy supply can continue at the same level it is now. It can not.

A more relevant question is what percentage of liquid fuel will ethanol be when we reach zero imports due to the ELM. By that time the ethanol percentage would be much larger because only domestic oil production would be available. This is not a minor point.

This inability to project oneself into the future situation is leading to a false conclusion about the usefulness of ethanol in mitigating Peak Oil.

Alan Drake's plans are suitable for urban areas, but are of little use for rural and small town areas.

The genius of Alan's approach is that he wants us to go with what we know works--using technology that was basically perfected more than 100 years ago, and built out with little or no liquid fuels.

Plano, Texas Interurban Museum


If you were fortunate enough to live in Plano between 1908 and 1948, then you most likely had an opportunity to experience the rollicking, clickity clack sway of riding on a Texas Electric Railway Interurban Car. This second generation of rail transportation extended from Denison to Waco, with connections to Fort Worth, Cleburne, and Denton possible through the "hub" station in Dallas. Rail transportation powered by steam first arrived in Plano in 1872 and forever changed the agrarian lifestyle of early settlers who had traveled to this area by covered wagon.

While steam engines guaranteed the survival and likelihood of growth to a community and transported farm crops to distant locations, the laborious process of producing enough steam to drive the train forward limited the frequency of stops along a line. In the late 1880's ingenious inventors discovered the wonder of electricity and devised ways to harness this marvel into driving trolley cars previously drawn by mules or horses.


Entrepreneurs, capitalizing on ways to market this new transportation, developed systems throughout the United States that connected small towns and outlying farms to a large, regional city. Overnight, farming families isolated from society by distance had easy and affordable access to opportunities and amenities available to urban populations.

And BTW, I think that local biodiesel plants, for agricultural use, probably make a lot of sense. Keeping with the theme of going with what was perfected more than 100 years ago, that is of course why Rudolph Diesel designed the engine in the first place--to allow farmers to have mechanized equipment powered by vegetable oil.

Compare and contrast that to what Plano has become; described by a college pal of mine (thirty years ago) as "the land where the BMW's roam free."

It has all the earmarks of what 'could' of been, had we not decided to go down the car path. not what 'can' be considering the current circumstances..

With some effort and expense (and trashing some wasted investments) a LOT can be done in a decade or two. Start now, and get as much done as fast as possible.


Alan Drake has many facets to the plans he has outlined. Trolleys may not be much use in small-town Iowa (right?), as they won't be in much of Maine, but a comprehensive system of electric Passenger and Freight Rail across the country will keep highway-bound, rural areas from becoming increasingly isolated. The plains states could be great contributors to an HVDC grid, possibly parallel to and serving these efficient electric rails, as they are fed in part by Iowa windpower.

I make no particular claims around ethanol, but I worry about the implication of doubling our dependency on crops for energy and for food, using materials vulnerable to drought, soil condition, fertilizer supplies, etc..

Either way, I don't think the Ethanol argument has any factors that preclude the sensibility of an Electric Rail buildout.



Iowa - Albia, Ames, Boone, Burlington, Cedar Rapids, Centerville, Charles City, Clinton, Council Bluffs, Davenport, Des Moines, Dubuque, Fort Dodge, Fort Madison, Independence, Iowa City, Keokuk, Marshalltown, Mason City, Muscatine, Oskaloosa, Ottumwa, Red Oak, Sioux City, Tama-Toledo, Cedar Falls -Waterloo PLUS several interurbans.

Maine - Augusta, Bangor, Bath, Biddeford-Saco, Brunswick, Calais-St. Stephen, NB, Fairfield, Lewiston, Portland, Rockland, Sanford, Waterville

Best Hopes for Urban & Rural Rail,


Very good link Alan, thanks, Some of those towns (in Iowa at least) are under 10,000 in population.

My hometown was smaller - about 2000 people - and I was born in 1952. Once it had passenger train service that stopped there, by the time I was about 5 or so it still existed but I think you had to catch it at the county seat 7 miles away (by that point owning a car was pretty much assumed). At least until the 1960s several buses a day stopped in town as well. And there were businesses covering the whole gamut of what people needed. They're all dead now, the main street has a few new boutique businesses that aren't covered by the mall 16 miles away. Walmart's about 20 miles away. Even the main highway (US 34) has been diverted south of town, adding to the civic demise.

Most of the people I know in Iowa live in towns or cities, but none of them, far as I know, believe ethanol is a good idea, by the way. Apparently they even didn't before they listened to me. ;)

Thanks, Alan;
I just wrote to one of my State Leg. Reps, (after your Post last week) but probably didn't advocate the positions clearly enough. Here is a bit of the response that I have to find arguments to counter.. should have checked with you right away, but had to get into 'Home Weatherization' mode.


You sound like the challenge is just a matter of presentation. I took note earlier this year when I learned that Charlotte, North Carolina had initiated what was turning out to be a very successful new light rail system. Use was higher than projections and the economics are favorable. Such news is a very good sign. But

Charlotte has a population of 616,075. That is in the city proper. Portland's population, of course, is 65,000. As you know, what makes a system work economically is ridership. It would be good to have a model of a light rail system in America that works economically for a population base even remotely close to ours. Do you know of any such system? What would be the closest?

I did reply, in brief saying 'I know we can't afford to do it, but we also can't afford NOT to..' , and words to that effect. I think the argument for having interurbans will sell sooner here than of having intown trolleys, but I'd love to hear what angles you use when showing this to State Govts.

Best hopes for working outside our skillsets,
Bob Fiske

Kenosha Wisconsin pop 96,240 has a streetcar system (recently voted to expand it). Uses old Toronto streetcars (Toronto about to scrap some more).


Also Little Rock


Seashore Trolley Museum is in Maine, I know the (former ?) Chairman of the Board, I think that they would be open to helping out a combo local & tourist line in Portland ME.

Portland OR has figured out how to build streetcar track for $300/ft in street (2003 $)

Best Hopes for small Streetcar Systems,


Soviet Elektrichka


Interesting technical but even more so social commentary.

I can see one and two car EMUs connecting small towns a few times/day. With a container, box or flat car as well.


Thanks Texas Jeff and I'll have a read through Mr Drake's material when I get a chance. However, what's your "best guess" at global BAU collapse (assuming world powers and the Big Oilers do little to help steer a new path). Three years? Five years? Ten? Twenty?

I need a plan to determine whether to save for that farm or not.

Regards, Matt B
Still living in MS with a decade of debt in my pocket!

Matt, the credit crunch is beating PO to the punch, though there are some that believe it was triggered by the plateau in oil production.

It may not mean the end of BAU or not in Australia (then again, it certainly may), but it looks almost certain to cause severe global recession, possibly depression. I've always felt that the initial stages of PO would manifest as economic downturn rather than sudden shortages at the pump. Saving money & getting out of debt really is a very good plan right now, as is trying to ensure your job is on the "non discretionary" side of the economy.

That said, there's been previous articles about Australia's exposure to net exports. A substantial proportion of our oil comes from Vietnam and Malaysia, two countries on the fast track to zero exports over the next two or three years. After that we'll join the queue in the Middle East, along with many other thirsty nations...

One criticism that I have of the video of the presentation is that the visual materials displayed on the projector screen are not included. If the video could be edited to include this material (Powerpoint I presume?) it would be more effective.

Do you mean you don't see the slides at all? A frame should be opening up to the right of the video window with all the slides displaying in sequence at the correct time. This doesn't seem to work properly in various browsers/OS. Are you using Windows/IE or something else?

If when you visit the page you see (to the right of the embedded video) a big blue square with mediasite at the bottom there should be some buttons above that. Click the thumbnail one and you can browse the slides manually if they do not display automatically.

I viewed the video with Windows Media Player, which I placed in full-screen mode since playing it in-browser clipped the video. Therefore, no graphs/charts for me :(

Strangely the first time I played it the full video was clipped to what seemed like the top left quarter unless I went to fullscreen. Every other time I've tried it the video was scaled correctly.

One of the best Peak Oil presentations I've watched. What was clear to me is when you look at your body of evidence Peak Oil is not some way out theory but exactly the opposite.

At the end of your presentation your thesis "Can we continue to look at infinite growth in a finite world?" seemed irrefutable.


As the saying goes, if you want more of something you subsidize it, and if you want less of something you tax it. This should be obvious even to an idiot, which tells you something about the IQ level of the people running the USA.

I don't agree-the people running the USA are having a great time-never better. A study was done quantifying the dollar value of being elected a senator or congressman, and on average it is gigantic-the actual salary is inconsequential. These constant "idiot" references only tend to muddy the waters, which is what TPTB desire.

BrianT,I think that when most people on TOD refer to the powers-that- be as idiots,or worse,they are refering to their lack of medium to long term vision,not their present ability to milk the system.

It's getting to the point where I no longer know how to interpret any claims of increased production from exporters, because I don't have a running handle yet on how much is left after going through the filter of domestic consumption. It's easier therefore to game declining production from Russia and Mexico, for example, as patently and uniformly bad news.


Great point Anti-doomer. We can expect these fuel subsidies to be phased out in coming years, while demand keeps falling in the developed world. US demand (El Fatso) is falling rapidly.
The advent of many EV cars (GM Volt) in the next few years is truly remarkable -- the OPEC-killer, the death-ray for oil speculators. There may be one more run left in oil prices, or maybe it is crying-time for the oil bulls. Too soon to tell. The bulls have one ball left after the last price plummet, but full castration in on the slate.

"we can expect these fuel subsidies to be phased out in coming years" NO! NO! NO!
Fuel subsidies WON'T be phased out till AFTER a country has an economic collapse or revolution.
An example, my family is Egyptian and the cost of subsidies there dwarf the spending on health and education combined. In '77 Egypt had bread riots that would have had the same result as the '79 Iranian revolution if the price rises were not reversed. Now Egypt has even greater cost of subsidising bread and the number of cars is up tenfold.
Subsidies (food and fuel) will kill Egypts economy and cause a revolution in the next few years (rising population,rising consumption, rising cost per unit and declining production, ouch!. Eliminating subsidies will bring that revolution forward to now so the governments will of course keep subsidizing to put off that day. Same in many of the other subsidizing countries (or do you think Chavez etal are popular enough that they wouldn't be ousted?)

The same thought comes to my mind. Ship them to countries with subsidized fuel, like China, Venezuela, and Saudi Arabia. This would help people here unload things that they would otherwise be unable to sell, but this only works if they don't do something stupid like go out and buy another SUV.

Several weeks ago I recommended loading up those car carriers with used SUVs and pickups for their return trip to the far east.

How does this help globally, or even just the US?

The best thing we could do is to minimize world consumption. If anything, we should pay cold hard cash for inefficient cars and recycle the materials in to high-efficiency cars for local sale and export.

How does this help globally, or even just the US?

It would help with the national balance of payments issue. If they displace new SUV production overseas the effect on foreign consumption would be a wash. If they expand global use of SUVs it drives up consumption/demand/price. I suspect in places like China owning a vehicle, even if it is driven infrequently is a status symbol, so perhaps these exported SUVs won't consume much.

Somehow this reminds me of the housing market. Someone buys a stupid SUV and it doesn't work out. All taxpayers pay hard cash to get it out of trouble.

2008 20mpg or no license
2009 25mpg or no license
2010 30mpg or no license

Unlicensed vehicals go to the junk yard. BTW: The same argument could be made of old semi tractors that burn a lot more diesel than newer ones.

Never happen! Because the ones making the laws need to be re-elected and the ones with SUVs elect them. That's one reason I am a doomer.

Via Con Dios or Vaya Con Dios (both forms are spelled correctly)

A friend of mine, Tara, has a brother named Lynford, could you be one and the same? I was telling her and Bobby about Peak Oil when I visited a couple weeks ago. Sounds like Josh is on board the Doomer wagon.

Not the same. See my profile. Only child but I have some half sisters from later in life father re-married.

I see nothing serious to stop the doomer outcome of this mess the world is in. I also believe it will be earlier rather than later because of unemployment acceleration among other things.

I think that "Vaya" means "go" while "via" means "way, path, avenue etc."

"I'm sure that someone has already started buying up cheap used SUV's in the US and shipping them overseas."

You can put them in with the ag equipment that's going to
places like Greece and Brazil.

I wonder if Greece has gotten 4 row pickers yet?

Westexas said:

I'm sure that someone has already started buying up cheap used SUV's in the US and shipping them overseas.

They're going to Mexico. Every month I see caravans running south on Interstate 35, for resale across the border.

Maybe this will be the smallpox blanket of the 21st century -- low-cost Hummers for exporting countries? It'll hasten along ELM curves for sure.......might even make some sense IF we had an alt-energy self-sufficient nation. But we don't.

I've seen this exact same sentiment earnestly expressed on several automobile enthusiast sites where the readership is generally of a reactionary political bent.

This frightens me because it implies that there are many in the West that are absolutely bent on making the worst choices possible going forward. It also frightens me because, with regard to autos, it appears that the "bigger is better" mentality has already propagated across the cultural divide between the Occident and the Orient.

I agree that the last thing we should want to do is to export our gas-guzzling vehicles to other parts of the world. (For the most part, those kinds of vehicles aren't already sold there because customers don't want them--high fuel prices being one reason.)

Rather, I'd like to see the US relax import restrictions on used vehicles from overseas. There are tons of compact diesel-powered cars and trucks in Asia, Europe and Latin America that aren't sold here. In Canada, you can import a foreign vehicle 15 years old or older, but in the US its 25 years. Up there, they import all kinds of low mile Japanese diesel powered vehicles, especially trucks, SUVs and vans, that get 30+ MPG and run great on biodiesel.

Many here in the US would like to choose smaller, but our choices have been artificially limited.

Those right hand drive vehicle scare me, especially when someone else is driving one. All the rest is true---good, low mileage, high mpg vehicles are coming into Canada in large numbers

Okay, wolverine,
I've got one that's even more extreme, and sicker:


"Would this help the economy?
What if, instead of recruitment bonuses, the military offered a new Ford/Chevy/Dodge truck/car after completion of their tech school? I'm sure the GOV could work out something with the Big 3 to provide vehicles at a reduced cost, increasing production/sales/etc..."

And the most mind-bending fact is that the replies don't exactly address the futility, much less the irony, of this whole blood-for-oil thing. I can imagine that Phase II of the program would pay a bounty in gallons of unleaded for every confirmed kill in-country.

Reading these conservative forums is a great way to get the pulse of the working class, if you have the stomach for it.

Thanks, I think, nelsone.

I'm just getting really tired of the seeming reactionary monopoly on public discourse in this country. In the long run I just want to hole up and be left alone to the business of sustaining myself and my family.

Now they are going to get our natural gas too!

The Chinese, sadly, are building an infrastructure based upon a lifestyle that, at best, would be appropriate and understandable if we were still in the 1950s. They have seen the past that is completely incompatible with the future and have decided to expand their economy based upon the symbols of the past. There is not much excuse for what has happened in the United States except to say that we were unable to project what would happen based upon our lifestyle. But it is obvious now how unsustainable the SUV/suburban lifestyle is and yet the Chinese choose to use that paradigm as their linchpin of development. They are busy making oil deals all over the world to make a mad rush to experience the thrill of the SUV lifestyle, a lifestyle that cannot possibly last more than a mere decade if that.

This has to do down as one of the greatest follies of the 21st century. We have seen the future and choose to ignore it.

Those Americans who want to cling to their SUVs and their high energy lifestyle will make the argument that there is no point in giving up their oil use if the Chinese will just take up the slack. In this context, personal, even national actions seem futile and irrelevant.

Well said.

The Chinese may be repeating the U.S. folly, but the U.S. was warned by the twin oil shocks of the 1970's that we needed to change our ways and we didn't heed the message. Here we are almost 30 years later again confronting the same problem. Seriously, folks, just why should the Chinese slow their rush to wealth? Their national consumption per person is way below ours and they have made a major effort to control their population, something the U.S. appears to be unwilling to even discuss, let alone do anything about.

All the while, the Chinese are building a capacity to produce electric vehicles, starting at the bottom with electric bicycles and scooters. There's no major company in the U.S. which is building such. Heck, we don't even have a company which builds modern motorcycles (sorry, Harley). We do here repeated claims that GM will begin to build EV's, sometime -- in a couple of years -- maybe, but the Chinese are already doing that. Remember how Honda grew from a maker of small motorcycles to being the builder of highly desirable, fuel efficient cars. The Japanese motorcycle manufacturers destroyed the British bike builders, who did not keep up the technical advances from Japan. BMW went thru a similar transition after WW II and now builds expensive vehicles in the U.S.

All those Chinese freeways will work equally well for EV's as for gas or diesel vehicles and also work with buses. I wonder whether the Chinese Government has a longer term view, as they will need the roads for whatever vehicles are available to use them. When they are done building, the roads will be new, unlike our U.S. Interstate system. We know how good the Chinese engineering can be, since we trained quite a lot of themselves over decades. In 30 or 50 years, the Chinese might still be a functioning nation, while the U.S. has become a second rate collection of city/states not unlike Europe after the 14th century. Could be that it's all part of the plan...

E. Swanson

You can't talk about population control for citizens until you nix immigration, and we're not to that point yet. I think as soon as unemployment pops up we will be though.

Like the US "National System of Interstate and DEFENSE Highways", the Chinese highway system also has military as well as civilian applications. The Chinese are prepared to quickly deploy massive military resources to subdue any civil disorder anywhere in their territory - that is how their regime stays in power. They are also quite capable of quickly cutting off all motor fuel to the civilian sector anywhere or everywhere if neecessary, or even of expropriating all privately owned motor vehicles if that is what they feel they have to do.

It is a different country with a different system. Keep that in mind.

China is following in other east asian countries' footsteps, not the US. China doesn't have the space and national mentality of ample/infinite resources to follow the American footstep. But following the east asian footstep still means huge oil consumption though.

Very Limited Traffic on Lower Mississippi

5 ships trapped in spill zone are let out and 10 ships through the spill zone. No statistics given on up-river vs. down-river ratio.

No upriver/downriver barges in spill zone, but East-West barges on Intercoastal Canal allowed as of yesterday afternoon/evening.

This is a small faction of normal traffic.

All at "slow bell", minimum wake.

More ships tomorrow.

Local gasoline as low as $3.69/9, I suspect that this reflects a surplus of gasoline that cannot be barged out.


PS: I stayed up late working on a paper for the Transportation Research Board, a division of the National Academy of Engineering. Quite an aggressive paper :-)

FWIW, gas was $3.69 in Brenham, TX yesterday. I don't think they've had any oil spills recently.

It's still $3.97 here, 40 miles away, at least in spots.

Re: Saudi Aramco denies shortage of fuel to rural areas (linked uptop)

Which reminds me of the old joke about the wife who walks in and finds her husband in bed with another woman. The husband denies it and asks "Who are you going to believe, me or your lying eyes?"

I have theorized that the Saudis may be curtailing their domestic refinery runs, in order to temporarily boost crude oil exports--and planning to offset the product shortage with imports. If this is what is happening, they may be having trouble finding enough diesel.

Electric Cars are not one of my great interests however I forwarded an email from one “Rob” sent me yesterday to the list. Late last night Css posted:

"Can you ask Rob in the Lab for more info like where did he get his EV, and how much it or the conversion cost?"

This morning Rob replied:

"I bought one of the very few available-for-sale Toyota RAV4EVs from Toyota in 2002. That's quite a story, too. With help from my fellow Californians, it cost me $30K. Twice what the gas version cost.

And I just had an offer I am not going to refuse: I am selling it for Twice what I bought it for, 6 years and 60K miles ago. So I will have enough to buy a new electric. Of course, like your friend says, they may not be availabe today, but in a year or two, I will be driving electric again. Might check out conversion companies (Several in CA) or wait for Tesla, Mitsubishi, Nissan, Th!nk, Javlon (Meyers), Phoenix, Aptera, many others coming. Not hybrids, not hydrogen.

The Main Stream Auto Mfg doesn't get it. Just like the MSM, I guess. I don't need to be sending kids to foreign countries to guarantee my right to drive an SUV to the mall. Doesn't seem right, somehow. And when we need energy, not gas, to keep the seams together, hopefully I can drive something else and be a help to my neighbors. I have an electric assist tandem recumbent trike, too.

I don't live in the city, but above Napa Valley, 1000 foot climb. Talked about moving, but we have neighbors here, community. Can't leave that. Boy, it feels different to know I won't have an EV. But I still am an EV driver, if only inside. Hope I'm not sorry. Check out EV World, EV finder, or feel free to ask questions about what I know works NOW. Hopefully it will work then."


The Main Stream Auto Mfg doesn't get it. Just like the MSM, I guess.

I'm not sure if some peak oilers get it either.

Some folks believe something like "oil production is dropping and you can't do without it."


Datamunger, the issue is not "doing without oil" but "doing without very cheap energy"! The world is fed with the aid of cheap energy. Read the post above on rural fuel shortages in Saudi Arabia:

Farmers complained of their crops being in danger of drying up because they could not acquire diesel for their water pumps to irrigate the fields.

Now picture how much graver the situation must be for irrigation in India, Africa, China and elsewhere. Picture the billion or so people of the world who live on less than two dollars per day when their food costs go to three dollars per day because of high energy costs.

The idea, the very idea, that we can just convert to some other form of energy without dire consequences is just preposterous. Even the cheap oil is now gone and other forms of energy will be even more expensive. The earth's population has exploded because of the availability of very cheap food produced with the aid of very cheap oil. The much higher cost of alternative forms of energy will spell doom to a very large percentage of the world's population.

That is the one blind spot in the cornucopian's line of vision. They pretend it does not exist by never looking directly at it. The availability of massive amounts of very cheap energy has fed the world and is directly responsible for our population explosion. It is going away...end of story. Tragic but true.

Ron Patterson

I definitely agree that cheap energy has fueled worldwide population growth at a high rate.

But that doesn't mean that a high standard of living can't be maintained with more expensive energy.

Note that much of the expansion of decades past was very wasteful with respect to energy (in a technical sense). We didn't have to be careful. We do now and it's within our capacity to be careful.

Our world is essentially energy + technology. We do have the technology to be very careful with energy use and high prices will constantly pressure us to utilize it.

But that doesn't mean that a high standard of living can't be maintained with more expensive energy.

A high standard of living! For whom? This was written in the year 2000.

World Hunger

• Nearly one in four people, 1.3 billion - a majority of humanity - live on less than $1 per day, while the world's 358 billionaires have assets exceeding the combined annual incomes of countries with 45 percent of the world's people. UNICEF
Every day around 24,000 people die directly from hunger or hunger related diseases - an unbelievable amount.

No doubt Datamunger, those billionaires will still have a high standard of living but most others will not. As the price of energy increases the standard of living will drop for almost everyone. But for those already living at the very edge of their existence, it will mean they will simply starve while another two or three billion people slip into abject poverty. But those who can afford electric cars will not be so bad off. Comforting thought isn't it.

Ron Patterson

Expensive energy creates problems even for countries who are net exporters.

I was in Bogota last week and was amazed at some of the things I read in the city's leading daily newspaper. Here's a link...


but a summary of some of the things presented is as follows:

☺Overall export revenuse for Columbia are soaring, up 26% in May. Columbia is heavy into the production and exportation of primary materials, such as oil.

☺Unlike Saudia Arabia, Columbia has not tried to defend the dollar. The dollar has plumeted relative to the Columbian Peso, falling from 3000/dollar several years ago to 1785/dollar today. The decline of the dollar has been expecially pronounced over the last year.

☺The decline of the dollar has wrecked havock on some parts of the economy that export to the U.S. For instance, one of the articles referenced cites that 60,000 jobs have been lost in one region due to the shut down of the shoe manufacturing industry.

☺Inflation is at 7.2%

☺The central bank raised the prime lending rate to 10% on Friday. President Uribe is screaming bloody murder.

☺The country is experiencing a huge contraction of the economy. Nominal growth in GNP is projected at between 3.3% and 5.3% this year, but with inflation running at 7.2%, the real GNP will contract by between 2% and 4%.

☺The contraction of the economy is reflected in the trucking industry. Total tonnage is down from 62.63 million tons for the first six months of 2007 to 61.56 million tons for the first six months of 2008.

☺Corporate income taxes are extremely low--13%. But for some "preferred" industries that receive special breaks they are as low as 9%. Personal individual income taxes are much higher, averaging 18%.

☺Due to the low tax rate on business, the government runs huge deficits.

I don't know what all these phenomenon mean or how to interpret them. I must admit that for me it is all very confusing. It would seem that with the huge surge in income from exports the country would be riding high. But the opposite seems to be ocurring.

The economy of Colombia will grow by about 4-5% this year, not contract, yes that is real growth, adjusted for inflation.

Something similar is happening in Canada.

Exports of gas, oil, potash and wheat from western Canada keep the value of the C$ high. But the high currency reduces manufacturing exports from the eastern part of the country as well as destroying energy-intensive industries like paper mills.

The net result is a transfer of wealth within the country from energy-consuming to energy-producing regions.

And on a global scale, the transfer of wealth to Russia and the Gulf states is part of the same process.

Sustained high energy prices are creating new winners and new losers everywhere.

those billionaires will still have a high standard of living but most others will not. As the price of energy increases the standard of living will drop for almost everyone

There is Hope. Someday every single man, woman and child will become billionares

Nearly everyone in Zimbabwe is a billionaire. If the proud people of Zimbabwe can all become billionaires so can americans!

But those who can afford electric cars will not be so bad off.

I suspect that if the dollar crashes or Global Oil production crashs, Getting replacement parts and spare parts will be very difficult, even for today's billionaires.

I guess it comes down to one's definition of a "high standard of living".

Can we do better than the Middle Ages? Definitely IMO. Can we do better than the late 19th Century? Maybe. Can we maintain today's US/European/Australian lifestyle in the face of extremely high energy costs? I don't think so.

Who is we? There has never been a time in human history when it didn't suck to be living at the median income level globally.

Not quite true. It was probably okay in our foraging past.

But yeah, if we actually have to start living at the median, it would suck. IMO, that's really the biggest issue with peak oil. The economic power will switch to those who have resources. And it may not be us.

Can we do better than the Middle Ages? Definitely IMO.

Definitely not in a world with 6.6 billion people. But when the population drops to about 500 million we will eventually rise to the standard of living enjoyed by those in the Middle Ages.

Ron Patterson

Do you understand just how badly the Middle Ages sucked for the average person?

No effective health care. None. Just flat out didn't exist.

Leaky houses heated by wood at best.

19th century standards of living may even be doable with current knowledge without oil.

I repeat that which I have said before: Not everything invented since 1857 relies upon fossil fuels to be useful.

I predict that some high population density areas will be really hard hit, but one of the first things that's going to happen is that those that can leave those areas will.

"I repeat that which I have said before: Not everything invented since 1857 relies upon fossil fuels to be useful."

Name some things ...

Safety razors, penicillin, broccoli and tea bags all post-date 1857 and can all exist without using oil or coal. Knowledge/ technology can keep us out of repeating the middle ages (doesn't mean life won't suck for most of the survivors).

For what it's worth, the modern road predates 1857 too. It was invented by John Loudon MacAdam in 1820. It didn't come into wider use until much later though, after aggregate started being covered with tar. Hence the name "tarmac" is used sometimes.

Do you understand just how badly the Middle Ages sucked for the average person?

I am sure he does

19th century standards of living may even be doable with current knowledge without oil.

The 19th Century was powered by coal. While some regions still have significant coal reserves, most don't. However, very big Hurdles remain before an industrial power can replace its oil\gas powered infrastructure. Its not easy transistion from a high EROI liquid fuel economy to one of a solid lower EROI fuel source. Virtually every vehicle on the road are fueled using oil. Plus the road themselves are made of oil (asphalt). Today we have little in redudant infrustructure (no transportation\agraculture systems using alterative fuels) and very little in emergency liquid fuel and food stock piles. Tommorow, If world's leading exports refused to take US Dollars for oil or they decide to hoard their remaining reserves for their own survival, the US would collapse in less then six months (probably much sooner as WW3 would almost certianly happen).

Not everything invented since 1857 relies upon fossil fuels to be useful..

No, just the most important stuff relies on fossil fuels. Think of what it would take to go back to animal power for farming. The ratio of humans to horses is at an all time low, it would take many decades to bred sufficient beasts of burden to match even pre-20th Century era numbers.

FWIW: Life in the 19th Century was very hard. Most people died at an early age. Health care wasn't all that great. I believe a large number of the Western population can't live without access to quality healthcare. Prior to modern medicine, a significant number of children born died before they reach adulthood (most died very young). Nature weeded out the weak and only the strong survived. Modern medicine as tampered with the natural order, and today we have large numbers of people who are very vulerable to disease without access to modern medicine (For instance, Consider the large number of diabetics living today). If access to to healthcare crashes, nature will take its natural course and take the weak.

I predict that some high population density areas will be really hard hit, but one of the first things that's going to happen is that those that can leave those areas will.

Where will they go? What work will the take on? Do you think the average western urban dweller is cut-out for back-breaking manual labor? Consider that without Fossil Agraculture inputs and irrigation, Crop yields will drop to 5% to 25% (depending on crops and regions). We will need to plant at the very minimum 4 times the number of acres to feed the population without abundant fuel and natural gas for agraculture. On top of that all but 1% of the population would be required work farmland (assuming lack of animal labor and very little fuel for existing farming equipment). While I doubt fuel production will drop to zero, nor do I believe that even a small percentage of the urban population will make a sucessful transision to farming\rural life.

I expect that the majority of urban dwellers will become financially trapped in cities and eventually die from disease, violence, or war. I think as times get tougher more and more people will reclocate into cities because they will offer the most public services (public transportantion, food and medical subsidies (food stamp, free\low cost clinics). I think gov't will add to the problem by devoting available resources to the cities and cut off aid to suburbian and exburbia regions and direct the non-urban population to relocate to the cities in an effort to reduce energy and transport costs.

Eventually cities will become constrainted as their infrastructure decays and become over burded with swelling populations take relocated into cities. Systems and social order will begin to break down. Malnuetrition, Lack of clean water, Lack of heating, will lead to pandemics. People living in the cities will be trapped since they have no place to go, no money and no supplies required to relocate out of the cities. Maybe a tiny few will make it out. Consider that when the Pandemics of Roman era and during the middle ages, the majority people didn't flee the cities. They couldn't because they were economically trapped. Even much of the nobility remained in cities and perished along with the common people.


I keep hearing that energy will disappear faster than it is replaced, but then I keep hearing about the poor little poor people who are suffering.

If the oil is disappearing, and there won't be a suitable and timely replacement, then it seems reasonable that the current group of sufferers will only be the first wave and that it will eventually he you and me as well.

I suspect 2 dollars a day seems like a lot of money to an American ex-autoworker currently making 0 dollars a day. At least with 2 bucks you can get a lottery ticket and a beer.

I wouldn't feel too sorry for the suffering poor people abroad when there will be plenty in this country soon enough.

I suspect 2 dollars a day seems like a lot of money to an American ex-autoworker currently making 0 dollars a day. At least with 2 bucks you can get a lottery ticket and a beer.

I guess you haven't travelled widely in the third world.

I wouldn't feel too sorry for the suffering poor people abroad when there will be plenty in this country soon enough.

What an unbelievable callous remark! Is it not possible to feel sorry for ALL starving people, regardless of their nationality? I am reminded of a very sarcastic cartoon I saw awhile back, sorry I lost the link.

A Major was showing his Colonel a new very powerful Rocket;

Colonel: What kind of fuel does it use?
Major: Babies.
Colonel: Babies!
Major: Yes sir, we grind them up into a paste then....
Colonel: That's disgusting!
Major: But sir, they are not American babies.
Colonel: Oh...okay then.

Ron Patterson

With all due respect Ron, your handle is Darwinian. Survival of the fittest and all that.


May I suggest IntelligentDesigner as perhaps more appropriate given your distaste for sufferring.

Is it truly callous to suggest that things are going to get really ugly? I'm hardly proposing it as a solution, but I'm not so ignorant as to think not talking about it will make it any better.

My wife is on the board of the local food bank whose roles have doubled while contributions have declined. We're huge supporters of feeding people in our own neighborhood, but we recognize we're losing ground every month. You see, we don't feel sorry for people. We do something tanglible instead.

So please Darwin, spare me the lecture. I'm growing ever more tired of them.

May I suggest IntelligentDesigner as perhaps more appropriate given your distaste for sufferring.

Right, I should choose superstition over science as a way to help me ignore world hunger and suffering. Deeming it "God's Will" would make it more easily to accept. However, unlike most other people I am unable to simply "choose" what I believe. The facts of science dictate my world view, not superstition.

Is it truly callous to suggest that things are going to get really ugly?

Absolutely not. I suggest such every day. It is truly callous however to suggest that we should only be concerned with the suffering of Americans!

So please Darwin, spare me the lecture. I'm growing ever more tired of them.

I can understand, given your attitude to the suffering of non-Americans, that you get a lot of lectures. I suspect they will continue until you realize that all human life feels hunger and misery just as much as Americans do.

Ron Patterson

How much time do you spend a day wringing your hands about the well being of the Malawai tribe? Have you built them any huts are taught them how to cope with the onset of peak oil? No, but god forbid someone say that maybe we should prioritize our efforts locally. We should all travel to the ends of the earth (expending copious amounts of oil in the process) to help a tribe we know nothing about.

Its this kind of thinking that gets Americans (and western civilization) in trouble in the first place. We worry so much about getting food and medicine to "backwards" tribes in Africa and Asia that we ignore our own deficiencies at home. We also cause internal strife in those countries through our patronage, promoting the creation of strongmen by telling locals they must get along or else we'll pull the bread and circuses away. I think the best thing that could happen to Africa and Asia in general is to escape western meddling and slowly build up their infrastructure like Europe did, by themsevles. I doubt it will happen as we want their oil and minerals too much, but I hardly think I should worry about a small african boy starving before one in my own neighborhood in any case.

In conclusion, you make some strange arguments Darwinian

Greg, you obviously do not understand my argument. I am a great fan of Garrett Hardin and realize that our support of starving nations has exacerbated the problem, not helped it. By keeping alive one starving child in the past means we simply have two starving children today. However that does not mean we should not feel empathy toward those two starving children. The total amount suffering today is indescribable and unimaginable. To quote Richard Dawkins:

During the minute it takes me to compose this sentence, thousands of animals are being eaten alive; others are running for their lives, whimpering with fear; others are being slowly devoured from within by rasping parasites; thousands of all kinds are dying of starvation, thirst and disease. It must be so. If there is ever a time of plenty this very fact will automatically lead to an increase in population until the natural state of starvation and misery is restored.
Richard Dawkins: River Out of Eden, page131-132.

To return to Garrett Hardin, he stated that the choice is never between good and evil but between the greater evil and the lesser evil. To have let starving children die in the past would have been a great evil, but it would have been the lesser evil because now the misery and suffering is so much greater because of that.

What really pisses me off Greg is the callousness shown to starving people simply because they are not Americans. It is a miserable world out there and is going to get a lot worse. And those who sit smug and happy thinking that no Americans will suffer are in for a rude awakening. The times of plenty are going away and all the world will suffer horribly. My heart aches for all humankind, not just for Americans. That is my argument Greg. You may think it is strange but it is the only one my conscience will allow me.

Ron Patterson

No-you are wrong-it is a great world. Just because you choose to focus on the hole in the donut doesn't make it a bad world. Why don't you take up skydiving or surfing or sport sex or something and leave your current trip to someone else.

Because Brian, I have a conscience that will not allow me to blind myself to the suffering that is in the world, and the even greater suffering that is about to come. Some however, are without conscience. They oblivious to the suffering in the world. Some even enjoy it. They are called psychopaths.

But as I said in the past, I have good bourbon. That helps.

Ron Patterson

I think the correct term is sociopaths. Psychopaths tend to have issues with reality while sociopaths understnad reality, they just tend to enjoy ignoring it.

You are confusing "psychopath" with "psychotic". The terms "psychopath" and "sociopath" can be used interchangeably.

well I'll be damned, I always differentiated

Less psychopaths, more cycle paths

The terms "psychopath" and "sociopath" can be used interchangeably.

Yes, they mean exactly the same thing. Both terms mean basically "without conscience". The difference lies in the what one believes is the "cause" of a person having no conscience. Those who use the term "psychopath", like me, believe it is in the genes, a fluke but not necessarily inherited. (Of the psyche.) Those who use term "sociopath" tend to believe it has environmental causes, or a learned behavior. (Caused by society.)

Ron Patterson

I think you have climbed to the very summit of the moral high ground, Ron. Well done ;)

Why don't you take up skydiving or surfing or sport sex or something and leave your current trip to someone else

It’s pretty obvious by your choice of suggested activities to a man over sixty years old that you’re a young one. Yup, life IS great when your young (you should have seen the sixties and seventies, oh, my), and all you know is the benefits of the life you received from the apex of western civilization, and death is just a concept. Everything is solvable, and why not, it always has in your short lifetime; bad things are things you see in newspapers or history books - they don’t happen to us.

Actually, there are lots of guys over 60 years old doing all three of these activities. Re what I know, what I don't know, who knows?

We all make our own choices and live as our situations provide. I think feeling anguished 24/7 for the whole world is a useless feeling if there is no subsequent action to relieve the feeling. Its all utility for me, which is probably why your argument looks so strange.

Hello GregTX,

Your Quote: "I think feeling anguished 24/7 for the whole world is a useless feeling if there is no subsequent action to relieve the feeling."

Although I am a fast crash, Thermo/Gene Jay Hanson-ite realist: nonetheless, I put what effort I can into Peak Outreach to help assert some grassroots' measure of optimal Overshoot decline; the coming Bottleneck Squeeze for us and all species.

As posted before: IMO, the Peak Oil, Climate Change, Permaculture, and other mitigative groups and speakers, conferences, books, videos, and webforums constitute the largest charity on the planet.

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

I think American Indians had it about right -- say a prayer for the animal you just killed, then use every scrap to maximum utility.

It is not good to ignore suffering, but neither can you be immobilized by it. Change what you can, accept what you can't, and move on. Those who cannot move on will be the first to go, and flexibility and resourcefulness always pay dividends.

I have long felt that food and health programs without population control are ill-advised, whether for 3rd world countries or welfare mothers. I can reconcile "choose life" and "help the unfortunate" with expecting effective birth control and gainful employment, but society has not. We want to have unlimited reproductive freedom and high living standards for all, but by attempting to guarantee both, we will eventually have neither.

Exactly, our population explosion is truly the elephant in the room.

Why bother discussing how to curb CO2 emissions and resource depletion if we won't face its ultimate cause...too many humans on this small earth.

We can't cure the whole world of all its problems. However, as physicians are instructed in their code of ethics, we can resolve to "first, do no harm". If we would even focus just on that much, that would be quite something. Most of us have a very, very long way to go before we can honestly say that we have accomplished even that.

If we deny the wolf its means of subsistence because we grieve for the dead elk, then we neither support the elk nor the grasses, shrubs, aspens, and willows that it eats unto oblivion. And the latter practice of the elk also denies the beaver the livelihood from the aspens and willows. Further, when the beaver is not around to build his dams, the natural flood control and water retention that it causes is also lost. Nature is clearly interconnected and its balance requires that species eat each other in order to maintain that balance.

But we human beings appear to think that we are exempt from this balance, that we can multiply without limit and that there will not be any consequences. And, by the way, the main concern, when there is concern, is that we human beings will run up to its limits of carrying capacity. In saying, this however, commentators typically ignore the non human species that we are causing to die by our overpopulation and consumption.

Ron is not calloused and if even if he were, he is not stupid and his approach is actually a lot more humane than many of those who supposedly show compassion. Short term compassion is fine as long as it is in the context of an understanding of the inevitable future.

In nature, we might grieve for the individual rabbit or ground squirrel but must keep in mind the sustenance of the bobcat or coyote. In order for one species to prosper, the other must suffer. This is the way of nature and we are not exempt from its laws.

Those teeming millions who are starving or who will starve as they run up against the scarcity of fertile land to support their existence will have killed off most of their fellow species before they begin to die. Even if they are not starving now, rest assured that the animals are starving now or are already dead.

Man has no real effective predator except itself and disease and starvation. Postpone this by increasing the means of subistence by providing food aid will just result in an even more horrendous and disastrous famine down the road. As long as we do not use birth control, in some cases because we supposedly revere human life will just result in more death later. Same issue relates to abortion. Pro life? Not really. Pro life policies are really pro death and pro suffering polices.

Food aid, to the extent that it literally becomes the long term path to subsistence is really a pro death policy in the long run.

Waste is the other unforgivable part of the equation, as efficient use would promote the least suffering for all.

I don't agree on abortion though. That's just birth control done terribly inefficiently and optimized for revenue generation and psychological damage. Sure it's a form of self-predation and not that much different than big crocodiles cannibalizing their young to manage populations during thin times, but I think (hope?) we can do better than that. Interestingly, that makes Planned Parenthood a rare predator of humanity, preying on the young as predators so often do.

The slippery slope of population control of course arises when some group people determine the allowable reproductive practices of others. On a global level there can be no other result, as in the end the wealthy will live and the poor will die, and we're probably not sufficiently altruistic to manage it more fairly, but we could perhaps do it worse.

How long before somebody decides that euthanasia is better, and that if 90% are going to starve we might as well get them out of the way humanely and quickly? It's only a few small steps from being a realist to a cynic to a sociopath. Add in a touch of elitism and nationalism and you have the recipe for a kill-off versus a die-off.

Hello Paleocon,

PAKISTAN: Lack of food prompting extreme actions by parents

...Several days ago labourer Abdul Salam clubbed to death four of his six children (ranging in age from 11 years to 18 months). Two others, who had also been badly beaten, survived. Salam said he did this as he could not feed his children.

He later told the daily Dawn newspaper he had killed his children because he was “unemployed for 10 days and could not meet their demands”. There was insufficient food in the house and when he killed them they had gone to sleep hungry, he said.

Despite the widespread shock, some say they sympathise with how Salam felt.....
Universal Peak Outreach [with includes birth control] would help prevent such tragedies. Alternatively, we can also expect many Tadeusz Borowskis, #119198:


As TODer Darwinian has posted many times before with his weblink: which lesser evil should we [humanity] choose?

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

Frankly, I think the slope will be slipperier if we do nothing. Abortion doesn't lead to euthanasia; lack of abortion leads to euthanasia. On our current slope, euthanasia has and will occur. When there is no other alternative, it will make perfect sense as was practiced on the island described by Jared Diamond. You hope we can do better than abortion. Thus far, there is no evidence that we can do better as many of those in power in opposed birth control. Right now we are on the fast slope to dieoff. Pick your poison.

Abortion IS euthanasia.

I suppose war is the highest (counter-Darwin) form -- euthanasia of the strong rather than the weak?

I've heard that in modern warfare highest casulties are among civilians.

Depends on the definition of modern and civilian. During Desert Storm it was mostly military deaths. In Iraq do you include only those killed by the US? Is an armed insurgent a civilian? What about the family he uses as a shield?

But certainly, many noncombatants die in war. Maybe duels at 20 paces then?

Another major problem is that the root of the overpopulation problem is that the people with the least education are the ones that have the most babies. It is highly politically incorrect to talk about that though. What happens after some generations when the people with the least education and/or most prone to be religious have systematically bred more than the educated and agnostic? It is suicide for mankind, and must be paid attention to, but it is hard to do as society has become very sensitive about stuff like this.

What you describe is the history of Lebanon. For generations the Maronites had fewer kidss than the Shia and Sunni and gave them a better education (they also placed a higher value generally on education, although ducated elites existed in all the communities). The Shia and Sunni communities had larger families and had less money left over for education. Eventually the economically well off Maronites became a minority and the numerically larger muslim communities wanted a larger share of the economic and political pie. Result was the civil war. (of course many Maronites were also having large families and many muslims didn't have big families, but the overall community numbers set the trend).

"We worry so much about getting food and medicine to "backwards" tribes in Africa and Asia that we ignore our own deficiencies at home."

Greg - Why aren't we creating family planning clinics in the 3rd world if we are truly committed to reducing human suffering in the world?

"A Modest Proposal" dealt with this in a much more entertaining fashion.

Solve hunger, reduce population at the same time. Cannibalism FTW.


Look at the size of this thread! Didn't see that coming. Frankly, I'm surprise my "score" is as high as zero given my propensity for independant thought and ascerbic personality.

When one feels sorry for anyone, much less 6+ billion people, what is the expected outcome? Probably not much. I've never heard Mary Ann, the Director down at The Pantry, say "Are you sure you want to give this check to us and not the people overseas!"

Am I really supposed to feel guilty about helping my own community when most do nothing? I know most do nothing because it only takes my wife a half a day a week to send out the Thank You cards.

Do you really think your reply deserves 3 votes? Here, I'll click it and make it four and me minus one. That will make your reply 66% more correct.

Whatever scores you get have nothing to do with independent thought.

That arrogance might, though.



Philosophical musing for the morning: does cheap oil equal cheap life?

Perhaps the abundance of oil has led to an "inflation" of humanity, where there are too many people struggling to succeed, and so we have reduced the value we see in others' lives while working every-harder to grasp more for ourselves.

Today the world is at the cusp of becoming large again at the end of the age of individual wealth, and every additional person is a potential competitor, not a potential ally. Perhaps we can no longer feel sorry for the third-world poor, but instead hope their economies crash before ours does? Close to home, will we riot and kill, or will we band together in a renewed sense of community? Inflation theory says lives will become dear again only when there aren't so many of them.

Once monetary wealth and the empowered individual have faded, we might return to community wealth and valued individuals once again. But by then how many will remain?

Will tomorrow bring a new sense of community, again driven by necessity to protect aga

Will tomorrow bring a new sense of community, again driven by necessity to protect

I certainly hope not. Societal groupthink has driven some of the worst decisions in mankind. I'd rather have individuals making good and bad decisions seperately than deal with lots of people banding together to take my food and fuel.

Societal groupthink will hopefully be replaced by "deliberative democracy". That's the real keystone to sustainability.

deliberative democracy


Thanks for getting the info, Ron and thanks Roblab too.

I looked into the RAV EV in 2003 when I needed a "new" car, but they were hard to find and cost $40K. I drove the first Prius off the lot here (ordered months before) for $20K - more in my range. It is probably the last car I will own, but if I ever buy another, it will be electric.

Here's info on an EV Conversion Workshop in Silicon Valley:


And what our county is working on:

County looks to become electric car-friendly

Your stop for gas and a candy bar could soon give way to an occasional shot of electricity. At least that's the thinking of a panel of county-appointed environmental leaders who see electric cars in our not-too-distant future.

Planning for a network of vehicle charging stations is one of the projects that the county Commission on the Environment is considering as part of its charge to reduce greenhouse gas emissions.

"We know that the technology is coming forward. Let's start supporting the infrastructure so we can be ready," said commission chair Virginia Johnson.


Personally, I am an extreme doomer and think things will fall apart before we get to our all electric utopia, but I always hope...

The WSJ story....

Funds for Highways Plummet
As Drivers Cut Gasoline Use

...misses a very important point: less driving means lane reductions and maintaining some roads at a lower level of quality simply because they are no longer needed. So there are savings to be had. The highway infrastructure doesn't all need to be maintained. It will make good business sense to downgrade and abandon some of it.

Some graphs from the article:

Currently we drive about 10,000 miles per year per capita (every man, woman and child). Back in the mid 80's it was closer to 7000 and there was a thriving car culture.

Hang on.

Doing some rough back of the envelope calculations, we are talking about 350,000 - 550,000 barrels per day drop in usage in the US. While I'm sure other countries will have suffered falls too, these numbers are only going to move the market a small amount (~$10 as shown by Saudi increase announcements).

To really affect the market we would need to be talking about 1Mbpd drops worldwide, but as far as I know we are still fairly static on the demand front. Someone else is eating all the pies.

If the decline rate isn't maintained (eg one off rather than continuous), prices will go back upwards again in short order.

...prices will go back upwards again in short order.

And hopefully they do because the process of migrating away from oil must continue in the United States.

Also, Garyp, if you add in increased Ethanol usage you're closer to 550,000 - 750,000.

Thought you might be interested.

US: U.S. oil demand in April was 863,000 barrels per day less than previously estimated and down 811,000 bpd from a year earlier, putting petroleum consumption at the lowest level for any April month in six years, the Energy Information Administration said on Monday.

U.S. oil demand in April was revised down 4.2 percent from the EIA's early estimate of 20.631 million bpd to the agency's final demand number of 19.768 million bpd, and was 3.9 percent less from 20.579 million bpd a year earlier.

By the way a drop of 863,000 bbls is quite large. Worldwide growth in oil consumption from 2006 to 2007 was 990,000bpd, according to the BP Statistical Review 2008). It is enough to wipe out two years worth of consumption growth from China.

Japan: Japanese oil consumption has been declining since 1996. Think of this as peak demand for oil, Okay?
Israel: Demand in Israel peaked in 2001, and it is now 16% less from it's peak level in 2001.

Italy: Italy’s demand peaked in 1995 and it is currently down 14%.

Sweden: Demand peaked in 1996.

Denmark: Demand for petroleum is down 20% from its peak in 1996.

The law of supply & demand does work.

Hmm, so:

Other uses of oil in the US have declined significantly


Ethanol usage continues to increase


The year on year rate of decline is accelerating and the measurement is lagging.

Given the supply is till flatish, someone else is definitely eating all the pies.

The next 863,000 barrel decrease in US consumption will be much more difficult than the last 863,000 barrel decrease. And the next will be even more difficult, etc. There is still a lot of "low hanging fruit" to pick in US consumption, but each successive piece of fruit is higher on the tree. This is not to suggest that we can't keep on eliminating demand, just that the price increase (relative to purchasing power) to destroy each successive barrel of oil consumption will be higher than the last.

While demand destruction suffers from diminishing marginal returns, geological depletion does not.

Also, from a systems-theory perspective, reducing the easy-to-eliminate demand, improving efficiency, etc., all makes our system more highly optimized. Highly optimized systems tend to be more brittle, less resilient, and more likely to transmit rather than absorb systemic shocks. It's a classic example of market failure: market-driven demand destruction will make the system more brittle because we don't attribute a sufficient market value to maintaining systemic resiliency (aka slack).

This is not to suggest that we can't keep on eliminating demand, just that the price increase (relative to purchasing power) to destroy each successive barrel of oil consumption will be higher than the last.

In principle, I can't see how this is true.

As time passes, the available technology to replace oil consumption gets better. So it will get easier and easier to reduce oil consumption.

Currently the automotive industry is undergoing such a rapid transformation that I can't keep up with the daily developments (though I try). Unless we track tech, we can't hope to understand the effects of oil depletion.

When will it be easier to reduce your gasoline consumption?

Now or when 75mpg vehicles (such as the Ford Fiesta ECOnetic) come to the US?

Here's a what if scenario for you:

Robert Hirsh was recently quoted in the Wall Street Journal as saying that he no longer believed that there would be a sharp drop off from current production levels. He now thinks there will be a plateau, though he didn't specify the length. Let's say there is a plateau of another 5 years.

Optimistic maybe but my point is that IF it occurred and the price of oil was egging us on to bring new tech to market during that time, it's quite possible that the tech available in the future would allow your average American consumer to cut his gas consumption by 90% rather painlessly. Much tougher to do it now.

Robert Hirsch was recently quoted in the Wall Street Journal as saying that he no longer believed that there would be a sharp drop off from current production levels. He now thinks there will be a plateau, though he didn't specify the length. Let's say there is a plateau of another 5 years.

The only words in quotes in the WSJ article were: "We have already been on a plateau for sometime". The rest is the author's interpretation. In a more recent interview on CNBC, he stressed that he expects oil at $500/barrel within 3-5 years.

That's what he gave as a 'worst case':


But then said (at the end of the interview) that $500 in 3-5 years was not unreasonable.

It would be good to know his base case.

Technological improvements also run into diminishing marginal returns (not to mention an absolute wall at the amount of work that must be performed at some point). Without doubt, you are right that it is possible that technology improves faster than population increases or production declines. The 75 mpg car is a great start, but we must remember that it also brings driving within the economic reach of billions more in the developing world, so may end up increasing inelasticity of demand more than decreasing empirical demand. At the end of the day, no one knows exactly how this will play out. What does seem reasonable to say, for now, is that technological improvement must improve our efficiency of energy use faster than depletion reduces energy supplies + population grows and demands more energy or the result will be as I stated above. Is that possible? Certainly, especially over the short term (next 5 years). Is that likely to happen? In my opinion, no, and especially not over the longer term (next 20 years). But, I also think that reasonable people can disagree on this point... we'll know when it's well in the rear view mirror(!)

Europe adapted to high gas prices by building dense, compact cities with walkable neighborhoods and good mass transit. Such cities are more resilient to high gas prices than our wasteful suburban lifestyle with all its low hanging fruit. For someone stuck in the suburbs, buying a 50 mpg hybrid is lower hanging fruit than moving closer to town, assuming we could even revitalize and build enough new units in those neighborhoods.

There's been a lot of debate about the effects of the cheap cars like the $2500 Tata Nano which, by the way, gets 51 mpg. Even with high gas prices, the purchase price is more important than efficiency in calculating affordability. The Nano represents the lower bound of cost cutting once you've done all the downsizing and simplification you can do to a conventional gasoline car. Any smaller and it would be a motorbike! To get higher efficiency than 51 mpg you'll need a more expensive car, whether it's hybrid, diesel, aluminum chassis, or battery electric.

If gasoline gets too expensive for even a 51 mpg car, poor people will go back to motorscooters, and rich people will buy expensive, efficient cars.

The pattern of dense, walkable cities was established in Europe and the rest of the world right up until the post-WWII period, not due to high gas costs, but because it was what made sense in a world full of pedestrians, horses, and trolleys.

My expectation: a city's "success" on the downslope of peak oil will be directly proportional to the percentage of its urban area that was laid out/built up before the 1930s. A more accurate prediction can be developed based on the percent of the population residing and working in this "old" portion of the city.

OK, that pattern of growth may have been established before WWII, but you could say high gas prices inhibited the growth of sprawling suburbs like in the US. I've heard the high gas taxes in Europe were to encourage conservation since they had no domestic production before the North Sea find, unlike the US which had plentiful supplies until the 70s. Unfortunately, by then our pattern of low prices and consumption was set.

I have seen many cases where sprawl is part of the city building codes.

You CANNOT build closer than X feet to another building, there MUST be X amount of distance between the street and the property, etc.

I mentioned Plano earlier, I remember back when it was one of those small towns of 30,000 or so, back when they had only one or two grocery stores and no movie theaters or shopping malls. Now look at it; in 2000 it was the 9th largest city in Texas (behind Houston and Dallas, of course) and has grown a lot since ten.

This was PLANNED this way, it didn't just happen.

As time passes, the available technology to replace oil consumption gets better.

Proof? As in, do you have some?

As time passes, the available technology to replace oil consumption gets better

Improvements to electrified rail are generally slow and marginal. Last major one was power electronics that take single phase AC > DC > 3 phase Variable Hz AC, perhaps 20 years ago.

Carbon fiber bicycles and e-bikes are inprovements, but not that recent.

Segways are probably the biggest, most recent improvement. But their oil saving potential is limited IMHO.


And yet, none of the listed items will replace consumption at the demand point set by $10 a barrel oil (Under Bush 1)

Hi jeffvail,
"The next 863,000 barrel decrease in US consumption will be much more difficult than the last 863,000 barrel decrease".
That would be correct if there was only one cause of demand destruction.
Based on the 1978-82 recession, demand destruction started with less VMT. This is mainly what has happened so far in 2007-8. The next drop will be due to new purchases being more fuel efficient. As the new car/light truck average rises from 25mpg to 30, 35 or 40mpg(depending upon fuel prices), there will be a 10 year slow decrease in fuel use /VMT. If people continue to drive the same amount, we could expect continued declines. Improvements in vehicle mpg available for new purchases are likely to continue pass the 50-65 mpg available now, with PHEV going up to 100-150mpg and EV using no gasoline.
Higher gasoline prices are also likely to reduce VMT of very low mpg trucks and SUV's because the relative cost of driving these will become much higher. For example for a 1000 mile trip a 12.5mpg SUV would use about 20 gallons more than the average 25mpg vehicle and 30 more gallons than a 50mpg vehicle, BUT the new 50mpg vehicles is only going to cost one forth the out-of-pocket costs. At $2/gallon thats only $60 less but at $8/gallon thats $240 less, so unless you really need the space or towing pull, its more likely that the SUV will stay at home IF there is a second car that much more fuel efficient.
These types of decisions will be made every day until the old gas guzzler is finally retired and replaced with perhaps with a 100mpg PHEV, so the old 50mpg vehicle will now be the one used less. Each cycle takes 10-15 years, but demand destruction will be relentless unless fuel prices DO NOT continue to increase in real terms.

I have a question about the numbers in this article. The EIA site lists US mogas consumption in July 2007 as 388.6 million gallons per day. At $0.184 per gallon, the tax revenue should be:

388.6 million x $0.184 x 365 = $26.1 billion per year at 2007 usage rate

a drop in usage of 3 or 4 % should only drop revenue about $1 billion. Where does the $5 billion shortfall come from?

I read a similar article in the LA Times recently. It claimed that the Treasury dept. said revenue shortfall was $2 billion through May compared to last year (this is in line with the $5 billion projection in the WSJ article). But that would imply a drop in usage of:

$2000 million/ 150 days x 1 gal/ $0.184 = 72.5 million gallons/day

But that is 18.6% of the 388.6 million gallons/day listed by EIA. No way usage has dropped by that much!

The LA Times article states the fund "will finance about $40 billion in transportation projects". If the fund only takes in $26 billion a year, then there is a serious problem! I am still unsure how the $5 billion "shortfall" developed. Did I screw up the math, or am I missing something else?

Does any other tax pay into the trust fund? The most concise info I could find on the funding was this:

"Tax revenues directed to the HTF are derived from excise taxes on highway motor fuel and truck-related taxes on truck tires, sales of trucks and trailers, and heavy vehicle use. The Mass Transit Account receives a portion of the motor fuel taxes, usually 2.86 cents per gallon, as does the Leaking Underground Storage Tank Trust Fund, usually 0.1 cent per gallon. The General Fund receives 2.5 cents per gallon of the tax on gasohol and some other alcohol fuels plus an additional 0.6 cent per gallon for fuels that are at least 10 percent ethanol. The Highway Account receives the remaining portion of the fuel tax proceeds."

So increased use of ethanol in gas could swing revenue from the trust fund to the general fund, further reducing trust fund revenue. But it seems since 3.1 cents is about 1/6th of the tax, even if every gallon fell in this category (and did not last year), then that at best is only about 16% drop. No way a year-to-year shift in ethanol blended gas is close to that amount.

Do the trust fund taxes on trucks/trailers/heavy equipment amount to an appreciable fraction of $26 billion a year? Even if so, would they drop $4 billion in one year?

Thanks for any insight -

There is another point it misses as well, Who is driving less?
As bad as economic conditions are here in Michigan the highways are packed with cars, trucks and all the gas powered toys you can imagine.
Even the marinas near my lifeboat have many slips filled.
To my eye I see none of the demand destruction these "studies" claim.
The doomer in me views articles such as these as conspiritorial propaganda, created to artificially lower oil prices to benefit the REAL market speculators, the shorts!

sarconol/rant off.

The less well off, the one's who have those badly paid jobs that are living hand to mouth and can't afford any increase.

Under the scenario I've detailed before, the severe stratification of US society is likely to mean these 'drop out' and there loss has a knock on effect to higher paid members of society.

This is purely anecdotal evidence, but I felt I saw many changes in traffic patterns as I drove I-75 the length of the Lower Peninsula on June 28th and July 6th this year.

I felt as though I saw far fewer large SUVs and very few people trailering boats, jet skis, etc. RVs and Hummers were almost non-existent.

Local surface traffic in the NW LP also seemed to exhibit a similar shift in quality to my eye.

Overall volume seemed to be down slightly, but not yet at crisis levels. I did note there were far fewer out-of-state plates around than in years past. Most of the out-of-state plates seemed to be from states bordering or near MI.

Boat traffic on the Inland Waterway also seemed a bit low when I was out kayaking on the afternoon of July 4th. Usually it is wall-to-wall, even if the holiday falls on a weekday. I can recall lengthy stretches when I saw no boats at all. I did get the obligatory, "How many MPG?" and "Work it!" comments from some of the boaters I did see. :)

Another anecdotal report... I had dinner with a friend at a popular restaurant in Mahone Bay this past Friday. It was a beautiful sunny day at the height of the tourist season and we were one of only three tables taken (with outside deck, I'm guessing the restaurant accommodates about 100 guests). I asked our waitress how this season compares to past years and she said this time last year we would still be waiting in line for a table to clear. I see far fewer out-of-province and, in particular, American plates. In addition to higher fuel prices, American tourism seems to have been impacted by stricter border security (unless I'm mistaken, American visitors to Canada require a U.S. passport to gain return access to their country).

BTW, Mahone Bay (http://www.mahonebay.com/) is one of the prettiest towns you'll find anywhere in this great province.


I made two trips down to Seminole County north of Orlando in the past two weeks. Normally, I avoid I-4 due to it being gridlocked every afternoon, but the last two trips I've been able to use I-4 just fine.

Another regional anecdotal report:

I was on a section of the Blue Ridge Parkway last week, and traffic seemed to be down. We ate lunch at the Pisgah Inn and had only a short wait - usually, the lunchtime wait during peak tourist season is at least a half hour or more. I didn't see any license plates from farther away than FL or the Midwest.

All of the local campgrounds are jam-packed full with RVs and camp trailers, parked year around for a fee. People have figured out that it is cheaper to just pay to keep it parked at their favorite vacation destination and drive up in a small, fuel efficient car. The number of RVs or camp trailers I've seen on the road over the past week I can count on the fingers of one hand; in past years I would have seen dozens. Starting to see RVs parked at entrance of campground with For Sale signs.

Belle Chere at Asheville seemed to still be doing OK though - estimated 350K attendance over the weekend, allmost all from within a few hours driving distance, I would imagine. People still vacationing, but doing inexpensive things closer to home?

I just heard a report from someone that vacationed on one of the Atlantic coast beaches - the place was half empty, tons of properties for sale, all of the local businesses doing badly.

I heard another report of someone on a flight from Orlando to Atlanta, almost filled with French and other European travelers. The low dollar makes selected US travel destinations a bargain for non-US tourists.

Wolverine: less anecdotal is looking at the MDOT site for Mackinac Bridge crossing traffic. The last six years data is there in tabular form. If I were more ambitious I would turn it into a pretty graphic. It looked like there were only increases from the previous year's data in two months, and both of those were in 2002/3. Otherwise the data shows a steady drop, of about 25% cumulative.

I have been driving less for several years now due to a severe disability and unexpected retirement that precludes driving more than 10 to 20 minutes at a time.

Unfortunately when I do get out on the road I am AMAZED at what I see. People in all makes and models driving like Mario Andretti, swerving in and out of lanes, 20+ over the speed limit in their "Fuel efficient" cars. Unreal. It always seems like I am THE SLOWEST one on the highway at 55 to 60 MPH. Everybody passes me. I go to the doctor this morning so I'll be watching again but it is absolutely unreal.

Demand destruction? Only in miles driven, not manner of driving.

IF people had a clue that they could save EVEN MORE by slowing down and driving in a more stable mode than by jackrabbit starts and full pedal stops than by reducing miles they would be onto something. Unfortunately I do not see it happening. The general public is not logical / rational enough.

I still wish it though. It makes for a much nicer drive all around. Another side benefit that the auto body shops don't want disseminated. :)


As long as time is more valuable than gas it will ever be so. When I drive on business it's a pretty easy trade -- if I'm billing, say, $50 per hour for work time but not for travel, and driving 80 will save me an hour on an 8-hour round-trip versus the posted 70, or two versus driving at 60, I'll do it. At 10 over I get one ticket every two years, so the legal/insurance cost is trivial.

Sure, at 80mph I might get 25mpg in my Toyota that gets 30mpg at 60mph, but I'm only spending $8 per hour on gas anyway, and 'saving' $50 on time alone. It makes some sense to buy a more economical car that I can drive faster, but driving slower only costs me billable hours.

When gas gets to $25 per gallon driving slower will make monetary sense. Even now, though, it makes sense to not drive at all if possible, as the driving costs maybe $30 per hour for vehicle costs on top of the $50 of work time spent, which is why I telecommute and telecon when possible. The real solution isn't to change to a "drive slowly" paradigm, but to a "travel less but quickly" model. This is where rationing would change behaviors more rapidly than price alone.

And really, driving fast is fairly efficient and safe as long as everybody travels fast. It's just a pain when people drive slowly in the fast lane, and ignore the left-lane-is-for-passing rule, so everybody spends their time decelerating and acceleration rather than cruising at max efficiency.

Hmm...if you could come up with a rationed gas credit system where hurried, highly-paid frequent drivers would pay leisurely, money-short, and infrequent drivers for their credit share we'd have a time-value maximizing solution. Making the credits gallon-per-month rather than per-gallon taxes would have a progressive effect upon wealth redistribution while still limiting consumption, and it would encourage everyone to buy the most efficient cars possible. At the individual level you'd be deciding whether to put your dollars toward a more efficient car or a few more credits each month.

I think you need to do a sober reassessment of your risk factors, you seem to have the reward numbers pretty well parsed.
Your statement that "...driving fast is fairly...safe as long as everybody travels fast." seems delusional.
Driving 80 mph is not only dangerous to you but is socially irresponsible in the sense that when you have your accident at 80 mph (which you will, eventually), the loss of control and energy unleashed will affect me poking along at 55.
In the blink of an eye lives are utterly, irrevocably changed forever.
The damage from a high-speed accident can be incalculable, and for goodness sakes, just read the newspapers, they are not 'rare' occurrences.

Yep – it sure wastes a hell of a lot of time for the rest of us when one (or more) of these hotheads inevitably runs into something or someone. Speeding, not paying attention, on a cell phone – whatever the reason - they eventually fail to negotiate or predict something correctly. Then their failure becomes everyone else’s misery – those just trying to make it home in one piece are forced to suffer by sitting in the resultant traffic jam. Now, for trying to save a little bit of personal time they have accounted for a HUGE waste of collective time. I wish us inconvenienced drivers who have had OUR time wasted by these idiots had the ability to bring class action lawsuits against truly negligent drivers who make us sit for hours in traffic.

The behavior I witness on the roads is a major reason why I think we’re stuffed as a nation. Rarely a thought is given to the common good or cooperation for the benefit of others on the road. It’s always "I have somewhere to go so get out of my way" – as if the concerns of anyone else on the road are trivial.

In my fantasy land I’d love to see some kind of limiters on cars and a serious set of penalties for reckless driving (i.e. one, maybe two warnings or minor fines – the third time – well, better find a good pair of hiking boots or tune up the bike because you’re never driving again… and much less leniency if their actions cause injury to an innocent person).

Speeding and hot-heads are two different things in my view. Inattentive driving is the primary cause of accidents behind drinking, and for every hot-head carving through traffic there is an unobservant slow guy changing into the fast lane right in front of a guy going faster. I can't count the times I've seen a 60mph truck swerve over to pass a 55mph truck on a hill only to block ten 65+ drivers for a minute or two. Or the times two people cruise along at 5 under or 2 over right next to each other, chatting on their phones oblivious to the cars piling up behind. And then they're surprised when somebody passes them on the shoulder........

Most slow-pokes seem to think it's legal to go any legal speed in the fast lane, but most statutes regard the left lane as a passing lane, and lane blockage law has no speed component in its wording. Here they've FINALLY started enforcing the passing lane, and it seems like everybody who gets a ticket for that writes a letter to the editor.

I agree about the "common good" on the roads. Everybody should recognize some will go slower and some will go faster and each should endeavor to manage their behavior so as to not adversely affect the others, and commit to not foisting their views upon others. Other people have places to go too, so you SHOULD get out of their way. Why SHOULD some people have to wait so others can toodle along enjoying the drive when they have somewhere to be? At least now with a cell phone I can get some value out of the time I spend in my car........

Chronic speeders almost invariably become hotheads if you somehow impede their progress - bullying and badgering people at every opportunity. I drive pretty much middle of the road (a bit slower now to conserve gas) and get out of the way when passing but I don't have an 8 cylinder car and quite frankly people that are going 15 or 20 mph over close on you very rapidly if you're doing around the speed limit - yet if I pull out to pass someone going slower I'm somehow at fault because another person wants to exceed the speed LIMIT by going 80 ? I don't agree with that logic at all. More often than not that speeder will end up pretty much in my trunk rather than back off for a few seconds to allow me to get past that one car and that's if I pull out into the passing lane with plenty of time (I don't dart out to pass - I'm not suicidal...)

That 60 mph truck you refer to is well within his rights to pass someone doing 55 mph no matter how many people he blocks for a minute or two (oh the humanity... a whole minute). There are minimum speed limits set on highways and any driver has the right to drive any speed down to that minimum. BUT the speed limit IS the maximum allowed by law and none of those drivers going >65 mph has a "right" to do that. Of course everyone thinks that it's subject to interpretation because it is constantly broken but it's a law nonetheless. A speed limit is not a view - there was probably something at some point that made the government think that it was necessary - safety maybe - or in the case of 55 mph to force conservation.

I wish I could find the quote and context but I seem to remember reading something by one of the founding fathers where he was of the opinion that the "small" laws were the most important to enforce because once it becomes commonplace for those to be broken then it just snowballs to where everything just gets shrugged off. I think that's exactly what has happened in the U.S. - it is a free for all on the interstates and highways most anywhere you go. I find it pretty much offensive that cops enforce the passing lane given the less than sparse enforcement they provide for people doing 15+ over the speed limit - but I can't say I'm surprised by it.

I wish I could find the quote and context but I seem to remember reading something by one of the founding fathers where he was of the opinion that the "small" laws were the most important to enforce because once it becomes commonplace for those to be broken then it just snowballs to where everything just gets shrugged off.

Sounds like Rudy Giuliani's "Broken windows theory."

The military has the converse - don't issue an order you know won't be obeyed, as it undermines your authority.

I find it entertaining that I'm viewed as the hothead here, when mostly I'm doing what the large middle segment does -- driving 5 or 10 over while complaining about idiots and maniacs. I just am willing to provide supporting rationale for my behavior.

The trouble with "legalities" is that interstate speed limits are really set for a poorly maintained car being driven inattentively on mostly bald tires at night with one headlight in the rain. Sure, plenty of times conditions require slower speeds, but most of the time faster speeds would be perfectly reasonable.

Really it comes down to risk management, and I argue that society should worry about drinking, cellphones, makeup, and vehicle inspections first, driver ability and training, and then speed differentials, before speed limits themselves.

In the end, the interstates are the safest roads to drive anyway. And peak oil will reduce traffic and trucks so that traveling is easier as well.

Paleocon -

I wasn't really implying that you were a hothead. During our exchange it became clear that you were referring to an area with speed limits of 70 mph (maybe more) so the speed you say you drive might be perfectly justified (especially in the West - I lived in New Mexico for a while and know of the ridiculous distances involved to get just about anywhere.)

I'm from back East where there always seems to be such high traffic density and the speeds and reckless behavior I witness on a daily basis have pretty much reached an intolerable level. I tend to get a bit defensive because there is such a rush to defend actions that are just blatantly anti-social and simply not civil all because of this idiotic American infatuation with speed. And it particularly irks me when the blame is placed on people who may not be able to afford a tricked out Escalade or a Hemi, or perhaps they are a bit older and don't quite have the reflexes anymore or are quite simply not as skilled. Whatever the cause - the highways are a form of the commons - where everybody has just as much of a right to use them as the next person. This attitude that somehow people who don't feel comfortable going super fast should be blamed, harassed, and treated as second class citizens strikes me as being symptomatic of just how sick this country has become and how twisted our priorities are.

In Australia the maximum speed is 110kmh (65mph) and based on a roadworthy car in clear daylight on a dry road. I seriously doubt that the traffic authorities in the US set the limits based on crap car+ crap road.
Anti-speeding campaigns in NSW use the examples of 2 cars driving parallel, at the limit and 5k (3mph) over the limit to demonstrate the extra stoppong distance. So 10 mph over as you condone is dangerous, not just to you but to the rest of the public.
Another point that many posters fail to realize is that even if you save time on a journey the value of that time has to be greater than the cost of not only the extra fuel consumed but also the tax cost,
Example: if I spend an extra $20 to save one hour on a trip then I need to make at least $30 to make it worthwhile as to earn that $20 I have to make $30 of pre tax income (at 33% marginal rate) if I am a wage earner.
You never get back the extra hour you waste in slower driving but you also never get back the extra hour you had to work to earn the extra cost of fuel used in speeding.

As I understand it, the design speed for interstates is 80mph, and of course there are rarely any emergency stopping needs (by design intent) and visibility is designed to be good as well. From my experience, deer at night and blown truck tires are the most frequent obstacles to avoid.

The 10mph point is valid at any speed, but as a square law, so why not make the limit 45, or 45, or 15? Any why not have separate roads for trucks and cars -- a truck is demonstrably more lethal at low speeds than a car at high speeds, from momentum equations and practical observation. Ever see the video of a semi rolling back onto a Corvette? Or idling forward into a Civic parked at an intersection? Drivers of the trucks couldn't even tell.

There is always going to be a trade-off between safety and expediency, but accident data shows that interstates are the safest areas to drive. If you subtract the fraction of drivers that fall asleep or wreck on ice and such, I imagine it's much safer still.

Good point on taxation, but the cost delta is still hugely in favor of speeding, at least in reasonably high-mileage vehicles.

Weird that you mention a truck idling on to a Civic at an intersection without realizing it. That is what happened to me in my '84 Honda Civic in '93. Shoved in the back of the hatch. At the time worst intersection in Sydney (replaced following year by flyover) with an accident nearly every day.

Me thinks Paleocon may not be around much longer. Just hope he/she doesn't take anyone else with him/her.

A quick note on your mention of speed limiters for vehicles. Two years ago I tried to find a company who sold them for gasoline vehicles. There are plenty available for diesel trucks, but I could not find any for my fleet of gasoline cars and vans. What I did find was chip tuners. These are people who reverse engineer the computer programs that run your vehicle. They do it because people will pay big bucks to remove the top end speed limit auto manufacturers set for each vehicle type This limit is typically over 100 mph!

Canada passed legislation about two years ago requiring all commercial vehicles with a gross vehicle weight rating (GVWR) of over 10,000 lbs to have speed limiters set to just below 65 mph. (Don't quote me on that number.) When I read that I immediately called the provincial department in charge of the new law expecting to get the name of the company Canadian companies were using to buy speed limiters for their gas vehicles. The person I talked to in a sheepish manner said they discovered, as had I, that the speed limiters were not available and they changed the law to reflect that.

Sad, very sad.

On the interstates (rural, real interstates, not the part that goes through town) the biggest dangers I see are errant lane changes by cars and unobservant trucks. Sure, 80 is more dangerous IF you're in a wreck, but it's only 5 over the toll roads and 10 over the other interstates. Certainly there are more vehicles going 80 than 55, and it's the differential that causes the most risk. Sure it would be safer if everybody drove 55, but it would be more cost-efficient if every body drove 80, and it's this difference in priority that causes the trouble.

At least once the trucks are gone whats left of the highways will be safer and more maintainable. I dream of the day when I can cruise at 90 in my EV on a car-only interstate........

That speed differential is caused by the following three scenarios:

A minority of people driving somewhat slower than the "flow of traffic" - which is LEGAL down to minimum speed for the interstate (usually 45 or 50 mph).

A majority of people that constitute the "flow of traffic" - typically ILLEGALLY 5 - 15 mph over the speed LIMIT.

Another minority of drivers going very ILLEGALLY 15+ mph over the speed LIMIT.

Slower drivers do not cause a dramatic differential compared to those doing somewhere around the speed limit. They cause a great differential in speed relative to those vastly exceeding the speed limit.

But this does not require the slower driver to speed up - this REQUIRES the fast driver to stop breaking the law. Voila - no longer a signficant differential in speed.

True. My next door neighbour died in a car crash last week, just a couple of miles from the house. Never even got chance to meet him as he'd only been in the village about a week or so. Left a wife and daughter behind, he was just 30 years old.

Every time I pass the house I see the new swing and slide he'd put up for his daughter.

I too have noticed a few local Prius drivers that really seem to enjoy dissecting traffic at 15-20 MPH over in their vehicles.

On the holiday drive I described above it seemed as though average interstate speeds were down. It seemed like there was also a little less rage and a little more courtesy.

I also noticed my total trip time was nearly an hour longer this year versus years past. Obviously that plays into my perception of lower average speeds.

Interstate speeds are down. Trucks are down a few mph, and more consistently at the speed limit. Car drivers are now mostly 5 over, and at 10 over I rarely get passed anymore. I used to get passed by those going 20+ over every few minutes, but now at 10 over it's maybe once or twice an hour.

I did an 8 hour test drive at the speed limit and got 10% better mileage -- the best ever, actually. But it's just not worth it (yet).

Interestingly, I still see a lot of vehicles pulled over on the interstate, but so far my 8-10 over average seems to still be "invisible". It'll take a year or so before I can tell if the odds just haven't caught up to me yet. My target is 1 ticket every 18 months or so. Any more than one per year that will increase my insurance, and any less than that just wastes time.

Then just as I have feared, the higher price of late IS acting just like a tax in that those who can afford to waste will continue to do so REGARDLESS OF COST.

As far as fewer miles driven "Unreal" is a good descriptor.

What put me on this rant was the fact that I consider myself like most folks and only drive when necessary.
Anyone who can't wait to get behind the wheel to get stuck in rush hour, construction or just the sheer volume of traffic these days has got to be in the minority.
To explain this another way, Friday I was delayed about an hour because my route unavoidably put me in with traffic that was going to a remote suburban outdoor theater in SE Mich that was going to see "Kid Rock".
When I see events such as those cancelled because of high gas prices then I can believe in demand desturction.

Which highway, might I ask? I actually saw some pretty nice destruction here in the ENC a month or two ago, but it has definitely started to trend back to normal traffic levels. I base this on El Camino Real and the 101. The one trend i noticed is that people drive even crazier (faster, more aggressive, and much less likely to follow even common sense laws) than normal during the rush hours, but the off hours are slow and reasonable driving (by Southern California's standards at least). I'm pretty surprised by the south bound I-5 traffic, which seems really light for horse racing season. I haven't seen a hummer in a while, though there seems to be no shortages of Escalades. A crazy trend that i am seeing is that the lower income areas that usually have streets loaded with Hondas all seem to be switching over to SUVs!

A caveat to all this is that the Shell gas station in the target shopping center on Leucadia Bvld. has for a long time been the highest grossing station in the nation. Actually the home depot across the street holds the same title. I have noticed that watching the trends in this area is usually a good indicator of the nation. The problem is that it is sometimes hard to identify trends without hindsight.

Woo-hoo, a minus two for me. Being a fairly ordinary guy here is unpopular I see.

I-40 is the interstate I'm on most.

Used SUVs are cheap, so they are yet another tax on people who can't do math.

i drive a '89 volvo, so it's not like i'm living large =). These are just my observations.

I'm in the same area (used to be in Encinitas now Vista). I have been trying to judge whether the traffic on 5 through Encinitas has improved. It used to be the worst spot in north county but the last couple of times I have been through Encinitas it has been much better. Have you noticed the change?

yeah, I mean take into consideration that the race season is in full swing and you can get from leucadia past via de la ville in less than 20 mins. I'm not sure how long this will last though, i'm already seeing the traffic trend back to normal on the surface streets, which I assume means that the freeways are next.

It's pretty much Business as Usual here in Central Texas.

Massive 4x4 trucks, motorcycle groups going for long rides in the country, RVs, and of course the ubiquitous SUVs.

I drove 60 mph yesterday through a highway construction zone and was passed by tons of cars and a few Uhaul trucks. The police were not watching, I suppose because it was a Sunday.

Much rejoicing that gas is under $4.00 a gallon all around us.

What I find intriguing is a few percent drop is described as "plummeting".

Has anybody seen statistics on the use of diesel fuel or truck miles? A decline in truck traffic would actually reduce road wear. On the other hand if economic pressure drives truckers to overload that would increase wear. I wonder if states will increase overweight enforcement.

It is plummeting. The population is growing, after all. There are more drivers on the road each day (theoretically, anyway). The bean counters were counting on that increase to fund new projects, maintenance, etc. Instead, they're getting a decrease.

It is plummeting. The population is growing, after all.

And here is the chart to show the effect.....

vehicle miles driven data comes from there:

And population data comes from here:

The year over year change is -2.2%.

That has not happened since the early 80's.

I should add that for this monthly plot, the miles driven stat used at each data point is for the entire preceding 12-months. So that tends to dampen the effect of the recent fall off in driving.

Sure lets just trust the government for all our facts, no possibility there could be some political manipulation.
From your link at top:

Prior to joining DOT, Mr. Ray served as Deputy General Counsel to the Bush-Cheney campaign and the subsequent Presidential Inaugural Committee from 2003 to 2005.


So from May 2006 to May 2007 total vehicle miles dropped while in the same period total vehicle sales were UP 7.2%.

All those folks bought those pretty new vehicles just to let them sit in their driveways.

Something about that original article has sent my B.S.S. (Bull Sh*t Sensor) off and your post did the same.

All those folks bought those pretty new vehicles just to let them sit in their driveways.

That thought occurred to me, also. And to some extent I think that is exactly what happened.

People continued to buy SUV's but didn't drive them as much. They were essentially waiting for the price of gas to fall.

You understand the the economic factors creating Demand Destruction will also destroy demand for EVs don't you?

or maybe they all can just sell their guzzeling suburban and by a...

OOps I forgot dealers are turning down SUVs.

May dampen demand for EV's but not destroy it. If a new product helps solve an economic problem (oil depletion), it will be rolled out even in a recession or worse.

The classic example that is always used in this case are refrigerators. Fridges were rolled out in the US during the Great Depression and they caught on rapidly with households.

datamunger- as many here have pointed out that was a time when oil flowed freely, energy was cheap to almost free, most if not all resources were there for the picking, cheap and easy.

Now every thing is HUGELY more expensive, resources across the board are harder to come by, the global climate is putting the squeeze on everything, and the US is HUGELY in debt.

I understand your way of copeing is to trumpet TECH but tech requires all of the things I listed above in order to happen.

Tech does not solve any of these issues, even if a technology does apply to one small area, or a bunch of tech put together addresses a bit of this It will not stop what is happening and will require tons of energy and money to implement.

The worst part of your belief system of tech fix is it gives people the false impression that they can keep on keeping on just as they are.

This is the WORST POSSIBLE thing for people to think right now.

I understand your way of copeing is to trumpet TECH...

Believe me, it is not simply 'a way of coping'. It has to do with managing investments. If the US adapts to oil depletion without too many hiccups, I stand to lose a fair amount of money. So it behooves me to pay very close attention to technology (and behavior changes).

The worst part of your belief system of tech fix is it gives people the false impression that they can keep on keeping on just as they are.

I think it's the high prices that convince people to change and my beliefs won't stand in their way. For instance, I suspect it wouldn't hurt to start saving up so that one could buy a highly efficient car in a couple of years. Credit may be tighter then than now.

OK, so after sawing all of what you just said in response

Disreguard all my earlier comments.

You are simply an ignorant a$$ who is sOOOOOOOOOOOOO out of touch as to be dangerous.

good night and good luck

You may have misunderstood me. I'm long oil and short the S&P. Not exactly dangerous. I've had these positions for a while now.

If I believed the US couldn't trim demand rather rapidly and adjust to peak oil via technology, I'd increase both my long and short positions. However, I suspect otherwise.

So I watch both tech and demand carefully. This trade won't work forever.

May I point out that The Oil Drum is currently running an article about a dude who wrote a book entitled "Profit from the Peak:The End of Oil and the Greatest Investment Event of the Century".

Based on the delivery schedules and battery costs of EVs, they'll be luxuries for rich drivers for a very long time, as someone else put it, a Let Them Eat Cake solution. A $24,000 Prius is reasonably affordable, but for people on a tight budget, the most affordable car is the smallest, cheapest conventional car you can find, e.g. a Corolla for $16,000 or a reliable used one for even less.

To me, the dramatic downward shift in miles driven is one of the clearest indicators suggesting that the US is in a significant recession.

Also, the data as presented suggest oil prices that mark rough "breaking points" in motor fuel demand for the US:

(Average monthly spot price for WTI)

First sign of a downward trend in VMT: $60 to $65/bbl (Jul-Oct 2005).
More significant downward shift in VMT: $70 to $75/bbl (May-Aug 2006).
Sharp downward shift in VMT: $90 to $95/bbl (Nov & Dec 2007).

Looks like about $90/bbl is the price point to really push rates of driving over the edge, so to speak, at least in the US. Though sustained prices above $50/bbl for a number of years before late 2007 may have contributed to straining personal budgets that put many people in a position to reduce driving at $90 or so per bbl.

Apparently, this is a small bit of evidence to suggest that oil prices need to be south of $60/bbl for any kind of economic "recovery", and that sustained prices above $90/bbl are causing serious economic problems. Kind of puts $120-$145/bbl in perspective.

Again, I'm reading a lot into VMT, probably too much... But it's interesting to think about.


Wolf in YVR BC

What is conveniently overlooked is that the amount of money spent on gasoline by Americans is at record levels, way up YOY. Obviously there is a limit to the amount of money in their pocket or room left on their CC, but this "plummet" is partly spin. Once the YOY amount spent on gasoline declines in the USA, IMO "plummet" would be appropriate. OTOH, that would mean the greater depression had taken hold.

A bit premature, don't you think?
For companies that build gas guzzlers, I can see how they will have to change their product lineup to compete.
But no one is going to stop driving as long as fuel is available.
A $0.25-0.30 drop in gas prices over the past 3 weeks has them right back on the roads.
I would think road construction projects being terminated would be based on more than a couple months of negative data, after all these are multi year endeavors.

You're in this business, how can they pull the $$$ so quickly?

Another point here that might be important with respect to scaling back the road infrastructure.....

We may be able to recycle material from lanes taken out of service to repair the infrastructure that remains. But I'm no expert.

From wikipedia:


Asphalt road surface is the most widely recycled material in the US, both by gross tonnage and by percentage. According to a report issued by the Federal Highway Administration and the United States Environmental Protection Agency, 80% of the asphalt from road surfaces' that is removed each year during widening and resurfacing projects is reused as part of new roads, roadbeds, shoulders and embankments.

According to energy investment banker Matthew Simmons, global oil production is now declining, from 74 million barrels per day to 60 million barrels per day by 2015. During the same time demand will increase 14%.

This is equivalent to a 33% drop in 7 years.

You could reduce the number of lanes on highways that are 3 or more lanes.

Much expensive maintenance is required even with lane reduction: culvert cleaning, hillside erosion prevention, culvert repair and cleaning to prevent road washouts, bridge maintenance and repair for 600,000 thousand bridges.


With less and less driving, and with diesel used in maintenance becoming more and more expensive, the states and federal will lack the resources for all of this maintenance, snowplowing, and highway security.

Alternatives energies will not even begin to fill the gap. And most alternatives yield electric power, but we need liquid fuels for tractors/combines, 18 wheel trucks, trains, ships, and mining equipment.

We are facing the collapse of the highways that depend on diesel trucks for maintenance of bridges, cleaning culverts to avoid road washouts, snow plowing, roadbed and surface repair.

When the highways fail, so will the power grid, as highways carry the parts, transformers, steel for pylons, and high tension cables, all from far away. With the highways out, there will be no food coming in from "outside," and without the power grid virtually nothing works, including home heating, pumping of gasoline and diesel, airports, communications, and automated systems.

I used to live in NH, but moved to a safer place. Anyone interested in relocating to a nice, pretty, sustainable area, good climate with much rain and good soil?

According to energy investment banker Matthew Simmons, global oil production is now declining, from 74 million barrels per day to 60 million barrels per day by 2015. During the same time demand will increase 14%.

Why do people claim demand will continue to rise with oil decline. This is impossible. Price will rise until the demand equals supply. If that 60mmbd will command a $1000/bbl price, so be it, but demand destruction will occur, unless governments decide to start rationing at lower prices, which will then create a black market for oil at $3000/bbl and cause more strife.

Greg, Price will continue to rise with oil decline because demand will still rise in exporting countries who can continue to subsidize the real price of oil.

*shakes head*

Demand will rise in the subsidized areas and fall even faster in the unsubsidized areas. Shortfall may occur briefly, but economic collapse should bring things back into balance.

The correct thing to say is something like "At any given price point, supply will continue to drop and demand will continue to rise". For example at the actual price (where demand = supply) then previously demand would have been lower and supply higher at that price (so that there would have been excess supply which is why previously the price was lower). [It's not easy talking about the past as seen from the future].

"I used to live in NH, but moved to a safer place"

What's unsafe about NH? I've always wanted to visit there and it always sounded like a great place to locate for survival in event of economic dislocation .

Most dependent state on oil (heating oil), not enough land and it is expensive, cold climate, short growing season. When there is no oil, how do you get wood to heat with, no chain saws and trucks.

"When there is no oil, how do you get wood to heat with, no chain saws and trucks."

Axes, Handsaws, Dogcarts and Decent Insulation.
Glass Roofs (which get insulated at night), Electric Chainsaws and Trucks http://www.youtube.com/user/newfarmerfilms , Exothermic Composted Natural Gas Heating, Tide and Wind Power, Geothermal

Or ask the Passamaquoddy and Outward Bound about how to survive a Maine (ahem, New Hampshire) Winter.

Growing Season: http://www.fourseasonfarm.com/main/harvest/harvest.html

"For the past eight years, in defiance of our long, cold Maine winters, we have been developing an environmentally sound, resource efficient, and economically viable system for extending fresh vegetable production into "the other eight months." We call it the "winter harvest." Our success thus far is very encouraging. We currently sell freshly harvested salads and main course vegetables from the 1st of October until the 31st of May."

Tools will break, and we'll fix the ones that we need to live. But there are lots of ways to live well up here without a ton of energy.

"There's no such thing as Bad Weather, just inadequate clothing" Outward Bound saying..

Relocated around the first of the year, cashing in some chips and leaving San Jose CA for Beaverton OR. Stable, established neighborhood in unincorporated area, 1.5 miles from two electric-rail stops, more than half an acre with lots of trees for $310k. No mortgage. Convinced the sibling to leave OH - now we're neighbors.

Who knows what will transpire, but you "look for your keys under the streetlamp, where the light is better," rather than facing all the worst-on-worst projections, which would just make me give up. What's the opposite of optimize? Pessimize? No thank you. I'll plan for self-reliance, not self-sufficiency, putting in a water well, buried LP tank, generator, heat pump, and underground storage. Lots to do, not much time left.

Oh, and I just married my S.O., too. Can't let her get away - and now she can't be compelled to testify against me!

I don't see the absolute connection between highway failure and and failure of the power grid. Trucks still manage to supply remote communities in outback Oz where the roads are never maintained. Incredible amounts of infrastructure are trucked in to support the mining operations.

I think you should change your rant to the food supply chain will fail due to the highway system because system that cant deliver the capacity required.

The US has abundant supplies of Geothermal energy. The only reason this has never been popular to exploit is because the coal/fossil fuel industry is too powerful. They would have no one to sell their coal to, so it has been illogical to develop geothermal with the mindset of the corporate chiefs who decide these things. Do a search for geothermal on TOD and come back and tell me I'm wrong.

20% of US power generation is gas, replace that with geothermal and it could be used to power trucks. It is possible to run a truck on gas. I believe 30% of buses in the states run on natural gas. Have a look at dieselongas.com

The only reason this has never been popular to exploit is because the coal/fossil fuel industry is too powerful.
Do a search for geothermal on TOD and come back and tell me I'm wrong.

You are wrong. The cost of drilling holes, the material to move the heat from the bottom of said holes to the top are two examples. Add in the very low costs of fossil fuels (pay over time) VS pay up front and one doesn't need a 'too powerful' magical fossil fuel industry.

But hey, go ahead. Show you are right RickJames.

"AUSTRALIAN motorists have been frightened into greenhouse submission. A shocking CSIRO report issued earlier this month warns of petrol prices of up to $8 a litre by 2018."

Is there a URL for this report?

The reference to $8 a litre fuel is on page 14

Information is limited on what oil prices might be associated with a peak in global oil production in the near term (2008 to 2013). Modelling undertaken for the Future Fuels Forum projected prices in the range of A$2 to as high as A$8 per litre by 2018 for petroleum-based fuel products in Australia, depending on how rapidly alternative fuels and vehicles become available and what share of diminishing global oil supplies Australia will have access to.

From Funds for Highways Plummet as Drivers Cut Gasoline Usage

A report to be released Monday by the Transportation Department shows that over the past seven months, Americans have reduced their driving by more than 40 billion miles.

That is the best news I have heard in weeks. Maybe you can teach an old dog new tricks.

"That is the best news I have heard in weeks"

Yes, and its all voluntary. Bless those wealthy folks who are considerate enough to reduce their consumption so the rest can have some. YEA.

"Maybe you can teach an old dog new tricks."

You should go check out the animal shelter lately for a more accurate depiction of whats happening.

I'm in Munich right now and I've been talking to some of my German friends about alternative energy promotion and there's something interesting I've learned on how they're doing it. What follows is all hearsay, I haven't had time to research it, but here it goes:

Germany has recently reached a level where 5% of their total electricity is coming from alternative energy. They did this by promoting home solar cell use. The problem usually with solar cells is the high up-front cost for installing them. To make it attractive for people to buy, rather than give a tax rebate like they might do in the U.S., what they did here is mandate a beneficial rate for selling the solar power back onto the grid. I think the usual rate for electricity here for buying electricity is about 20-35 cents/kWh whereas the mandated rate for residential generators selling solar power back to the power company was 42 cents/kWh. This had the unintended side effect that people who installed the solar cells were selling all the power from the cells to the grid and buying the conventional electricity from the power companies rather than what they were supposed to do which is sell only the excess power. Who was eating the cost of this? I found it hard to believe but people seemed to think it was the power companies (!) who were forced into this with the threat of removal of some monopoly status protections. Now that Germany has reached their 5%, they have lowered the solar power rate substantially, but I think it's still profitable.

It's an interesting way of going about it, but I guess it would never work in the U.S. I guess since in practice in the U.S. the tax-payer ends up bailing out everybody and companies are never held to pay for anything for long (e.g. the current financial crisis, or the superfund for CERCLA). It seems to have worked though, there are a lot of solar cells on people's roofs here.


To "sell all from the cells, and buy the conventional" would require dual metering to be installed by the power company - one meter for the cells, and one meter for the house. I would suspect that in most situations the power companies could easily restrict their customers to one connection per dwelling or some such regulation. But maybe they did not care to be scammed if the object was to get solar installed.


A large proportion of residential solar panel systems being installed globally are going up on roofs in Germany, primarily due to above mentioned feed-in tariffs. Not-so-sunny Germany and Japan have had the lion's share of solar system installations for a number of years (I think their portion was approaching 80-90 per cent in 2007).

Of the systems installed in Germany, roughly 90 per cent are installed in the rich southern states of Baden-Württemberg and Bavaria. Bavaria is not blessed with much sunshine. Indeed, their summers are notoriously damp and cool. However, the conservative Christian party CSU (that generally garners approx. 60 per cent of votes at state level) have long supported renewable industries, specifically bio-mass energy and residential solar.

I know there are a lot of people in the U.S. who feel strongly about owning their own solar on their own roofs, but the thought that comes to mind is that many homes aren't sited properly for solar. Either they don't have a good south-facing roof, or they have a lot of shade from a large tree. In our case we have a roof that is high with a steep pitch that isn't really south-facing, and it is a real pain getting anyone to go up there. I don't even want to go up on the thing...

I see stories about places in California where they are installing solar on large flat roofs like you would find on a warehouse or factory. Here you have more flexibility in ensuring that the panels are facing the proper direction, and you have economies of scale in that the planning and preparation costs are spread over a much larger project.

And from the reactionaries:


Interesting read. I don't use debit cards and never will.

Same here. Credit, yes, debit, no.

(And yes, that link is correct. They put a "hold" on your account. They're currently trying to shorten the hold for gas purchases.)

I've never heard of this. I've used a debit card for 25 years (VISA) and have NEVER experienced this. It's the only credit/debit card I own...it all comes out of my checking account. Is this a new practice?

I've heard of this before - supposedly when the pump checks for authorization, since it doesn't know how much you're going to pump, it puts a hold an a large amount of funds.

I always pay with my debit card and have never seen a hold - I don't get a receipt at the pump, so I check online to deduct it from my account when I get home. Usually the correct charge is pending deduction from my account in short order.

Maybe pumps here are different - maybe CA has a law?

Maybe the people who are having holds placed are people who tend to overdraw their accounts?

Years ago, I had a $500 hold place on a credit card when we stayed in a hotel and I ordered video games on the TV for my son - pretty outrageous since I don't think he could have run up more than $50 or so...

Another day, another article about oil speculators.

Commodities such as oil could be the latest bubble about to burst

Where demand or supply are unresponsive to price, or where they are responsive in roughly equal amounts and in opposite directions, then speculation might drive up prices without building up stocks. It's true there must be the desire and preparedness to build-up stocks, but if prices rise in response then the need to actually build up the stocks is dissipated. If speculation drives prices up to where the speculators think prices will eventually end up, what is the point in building up stocks in order to sell them at a profit later on? Once current prices have risen, there is no prospective profit left.

If speculation worked to drive up prices and make $$ for speculators, why hasn't speculation driven up the price of every commodity since the markets began?

The belief in speculators controlling the market is just not logical.

If the price of everything goes up that's inflation not speculation.
And if that happened the speculators wouldn't make any money.

Especially if you live in a state where the weather is decent much of the year, here is a possible solution to your peak oil woes......

Announced today:

Green Transporter Introduces Plug-in Hybrid Scooter

Green Transporter, based in Encinitas, California, has introduced a plug-in hybrid electric scooter—the PI Hybrid—powered by a 50cc engine and a 500W electric hub motor.

At speeds less than 22 mph, the vehicle will operate solely on battery power. At speeds over 20 mph, the vehicle uses blended electric and mechanical power, for speeds up to 45 mph and longer range. The scooter has an electric range of 25 miles.

The plug-in hybrid scooters sell for US$2,295.

What the heck do they mean by mechanical power?

Has it become politically incorrect to say, "gasoline"?!

Especially if you live in a state where the weather is decent much of the year, here is a possible solution to your peak oil woes......

Right! Because by spending JUST $3,000 all the other 'peak things' will be A-OK. The Roads will be fixed on the gas taxes of using a 50cc motor as an example.

Thanks for finding this fix that solves it all!

Why does something have to solve it all?

If it solves it for a decent number of people, is it not worth mentioning?

As I mentioned in today's Drumbeat, some of those roads won't need to be fixed. i.e. If people continue to drive less, we can intelligently discard or downgrade some of the road infrastructure.

Yeah, that's gonna happen because VMT is down 3%. Find me a politician who is going to openly suggest it, or an electorate that is going to buy it, at least for anything less than an extended double-digit downturn in VMT.

As it is, spending on highways and roads for critical, urgent and required maintenance, repairs and upgrades is well below what the Dept of Transportation says is needed. For example, in 2005 DOT claimed $375 billion in federal spending was required over 5 years and Congress authorized $286 billion. In 2007 DOT claimed $415 billion was required for the 2007 - 2011 period. Federal spending in 2007 was $27 billion, $33 billion in 2008 and the current projection for 2009 is $41 billion.

The remaining $314 billion is not likely to materialize for 2010 and 2011. In fact, with the federal Highway Trust Fund now facing a deficit of $6 billion or more in 2009, unless Congress appropriates money directly into the fund federal spending will drop to around $27 billion for 2009.

DOT, the National Highway Transportation Safety Agency and the American Society of Civil Engineers estimate that 33 percent of paved roadways have surfaces that are in poor to mediocre condidtion and 26 percent of the bridges supporting roadways are structurally deficient or unsound.

We have already implemented an unofficial policy of silent degradation for our roads and highways and so far the public has gone along with it. I suspect that deliberate abandonment of already existing raods will not go over well, if at all. And, further degradation is likely to only be tolerated until there are a few more occurrences of the kinds of death dealing failures like the collapse of the I-35 bridge in Minneapolis.

Good point. How would any politican ever decide which road going to who's home gets to become gravel? Or has a lane shut down? I see us puttering along, like you, until a few more disasters happen. Then who knows what will happen.

And as cjwirth noted above, the cost of roads is hardly just re-paving every few years. I use the example of the highway in front of my office. They spray for weeds, mow, replace sidewalks, trim trees, respond to wrecks and spills, jet out the storm drains, paint stripes, et al.... although I'm sure some of the cosmetic maintence is set to be reduced in the future.

Surely one would be better off navigating rough roads on a light motorcycle than in a car? A 50cc bike might not be such a bad option in that case. Of course, gas taxes could be raised in the US too from the current low, low levels. Slap on three dollars a gallon for personal vehicles and watch conservation kick in!

Enduro motorcycles may be a popular item in post-peak motoring. Nothing short of an armed checkpoint will stop one. You can get this electric one for $7500.


Eric, I see no point in your snarkiness here. Do you think it would be possible to harp a little less shrilly? Really, he didn't actually say 'ALL your peak oil woes', so why treat it that way?


. Do you think it would be possible to harp a little less shrilly?

I harp shrilly when the poster has shown a history of posting, then not understanding the answers they have gotten or rejected without reason.

DAtamunger is repeating the same arguments that have been beaten down here on TOD before. Not to mention his willingness to not actually debate his points.

One could go back over 3 years of TOD and provide a link-fest, but its not like that will change his mind. And he'd just keep posting.

Tell ya what - next time I see someone who's been told the answer they seek and rejecting it outta hand or when the poster is new and wants to hash over what has been already discussed, I'll post a link for others to respond http://images.google.com/images?ie=UTF-8&q=bat%20signal%20bad%20idea

One could go back over 3 years of TOD and provide a link-fest, but its not like that will change his mind.

Make sure you include Stuart Staniford's work in that link fest!! ;-)

Yup, they use "Mechanical power" to disguise the fact that the 50cc engine is most likely a 2 stroke polluter.....

Oh, AND how does the "Mechanical" power start? Probably by the usual means on a moped; engage the clutch by using a small lever on the handlebar while rolling. Not a seamless or smoothly operating feature but one that works none the less.

This thing is unusual in that a moped in California is limited to 50cc and 30 MPH. If it has a combined HP rating above what a moped has or has the ability to go faster than 30 MPH, it is considered a motorcycle and needs registration and insurance.

Still, it will get better mileage than a standard moped or scooter.

So what do you make of these?


I actually test rode a Vectrix. It's an electric maxi scooter, equivalent in size and power to a Suzuki Burgman or Honda Silver Wing. It's big, comfortable, keeps up with traffic, and you'll need a motorcycle license to ride one. The build quality is on par with the Japanese and miles ahead of the cheap Chinese electric scooters. The big limitations are cost, $11,000, and range, 40-45 mi in real world driving. A lithium ion battery would improve range over the NiMH battery used now.

Public Transportation is also affected by the lack of driving and revenue from tolls. Its a catch 22. People drive less, less revenue is generated which is ultimately needed to finance the increasing use of public transportation.

Could any smart people out there with a good understanding of economics help me solve this conundrum: "Does peak oil necessarily lead to monetary deflation?"

The movie "Money As Debt" suggests that the vast majority of money is created as debt. Furthermore, the interest on this debt can only be serviced by a further expansion of the money supply through an expanding economy taking on even more debt. So we need an infinitely expanding economy to prevent defaults on debt payments.

Peak oil prevents economic expansion so the money supply should contract leading to deflation.

Is there any way that governments can prevent this?

If you don't have an expansion of the economy you can also accomplish the result by a dramatic devaluation of the currency. These debts are stated in fiat currency, the US dollar. The value of the US dollar is headed right down the drain, so stating the size of the USA economy in US dollars (i.e. toilet paper) will effectively disguise the actual situation-it has been going on for a while but the pace will pick up dramtically. If you hold USA real estate, make sure it is somewhere with foreign buying interest-start thinking like a third world landowner.

Thanks for your reply.

I guess what I was getting at with my question is can the deflation be countered by, in effect, printing money?

Can U.S. dollars only be created (and thereby deflate their value) by selling treasury bonds to the federal reserve. If so, is there any limit on this?

I don't think the congress debt limit means much because they keep raising it every time debt exceeds the new ceiling.

But what happens when all government revenue from taxes are no longer sufficient to pay the interest?

I guess what I was getting at with my question is can the deflation be countered by, in effect, printing money?

This is something that has been repeatedly argued here. We don't have anything like a consensus. I think there will be a key post on it soon.

Me, I'm leaning toward "No, printing money won't work." You still have to get it into circulation somehow, and Helicopter Ben doesn't have enough helicopters. Credit is drying up, and it would take an awful lot of new money to make up for that. Banks don't want to give loans even to good customers, for good investments. And I think it's only going to get worse.

Banks don't want to give loans...

However, with the current creeping nationalization of Fannie and Freddie, soon the US government could be who you deal with directly when you get a mortgage.

The US government already is the guarantor of most mortgage loans.

That is how money can be injected into the economy to prevent deflation. It would appear different but in essence the government would print money and then loan it for car purchases, infrastructure loans and even business loans.

How does the government get into these businesses?

It's actually not hard. When a lender currently fails, the government takes over the banks infrastructure and then eventually sells it when the operation is wrapped up. All it has to do is not sell it and instead continue to operate it itself. (The government is already operating several large bankrupt banks -- Indy Mac for instance)

Great Idea datamunger

Maybe they could create... oh I don't know...
I got it, a housing bubble, yeah thats it.

(boy am I on a sarcanol binge today)

Ok, excellent, I'm looking forward to the post you mentioned on this topic.

So is there anything that can fundamentally prevent the U.S. government from mass employing all the out of work people in the country to work on energy infrastructure as a way to pump money back into the economy?

I'm not saying this is desirable, but I just wondered if there are any structural or financial constraints preventing the U.S. following Weimar Germany and Zimbabwe?

So is there anything that can fundamentally prevent the U.S. government from mass employing all the out of work people in the country to work on energy infrastructure as a way to pump money back into the economy?

Lack of requisite skills and resources could put a damper on it.

But I believe that with respect to deflation, some of the people here are on the wrong track. Serious deflation is always preventable in a fiat money economy. The falling prices that Japan experienced were very minor. Fractions of a percent. It barely shows in the CPI data. They could have prevented it but chose not to.

Comparisons to Japan aren't useful-the Yen has always been very strong. The USA dollar is in serious trouble, the only question is when the run starts. Deflation is a misnomer. As an example, a house in Flint is listed for sale for $5000-the place sold for $150000 in 2005. These guys like Mish that talk about "deflation" really mean economic collapse, which is different. Rsing energy cost, rising food costs, rising taxes, healthcare, insurance, combined with collapsing RE values and a collapsing currency isn't deflation.

Me, I'm leaning toward "No, printing money won't work." You still have to get it into circulation somehow, and Helicopter Ben doesn't have enough helicopters.

I don't think the US govt. has the means to create money without the concurrent creation of debt-- i.e. 'print money' in the Weimar-Republic manner. It seems like what has been happening has been the constant rolling forward of the 'due date' for all the debt. If a debt 'never' needs to be paid off, then we have the inflationary pressure of all that extra money in circulation. Of course cheap imports held down apparent effects of this inflation, or at least postponed its effects.

It seems to me, with my limited understanding of economics, that what is happening now is the calling due of massive debt that has built up over the past decades, leading to shrinkage of money supply (see Mish) and, hence, deflation.

But, argue on...

Currently, M2 is up 5-6% YOY, M3 way up. Mish never discusses this.

Long term, yes, more expensive and more scarce hydrocarbons of all types will probably cause the US economy to do poorly, and probably contract, which in turn suggests that - left to take its natural course - the long term trend will be deflationary (speaking in terms of money supply). Monetary inflation cannot overcome the inevitability of this long term trend, but that won't stop the authorities from trying it. Inflation of the money supply is the last tool in their bag of tricks, so when everything else has failed, they can be counted on to use it.

Thus, the short term outlook is inflationary, the long term outlook is deflationary.

IMHO, anyway. Then again, the whole world could blow up tomorrow and this could all be academic. Or we could just muddle along for decades. The only thing I know with certainty is that nobody knows anything with certainty.

Let's hope that Cheney doesn't get his way with an Iran War, or else the world will indeed 'blow up tomorrow'.

In regard to inflation/deflation, I was guessing that we currently have deflation (in a monetary sense) being masked by commodity inflation.

This sounds impossible but they can co-exist if the commodities are becoming more scarce. I.e. less money buying even more scarce goods can cause higher prices if wealth is not distributed evenly (i.e. the poor miss out).

This all sounds like a wacky new version of musical chairs.

I think we're in the same fix as with oil, in terms of prediction. Peak Oil models work well on local scales, when there are alternative sources to address demand with nominal price increases. The depletion curves still work for world-wide models, but nobody is really sure what will happen in terms of price vs drilling vs alt energy, neither how fast nor how far a shift might go.

With a local money supply, you can predict to a degree what mass borrowing, printing money, or work programs might do. In a global economy, where your currency is a standard, it seems a lot harder to manage. We CAN'T borrow enough, but we ARE selling assets to finance negative trade balances. I think we can either choose inflation or depression. If we don't stop the bleeding (oil plus trade), the dollar can only get weaker. At home, that means stuff gets more expensive in real terms (prices go up faster than wages), but internationally our products and assets get cheaper.

I think the path we are on is to sell assets to maintain the imbalance rather than cutting oil imports and increasing exports. It's been too long since I took any Econ, but I can see no future for the dollar but down until we come clean on debt, energy, and trade, and rebalance the books on all fronts. Right now I think we are selling our infrastructure at firesale prices just when the replacement cost (and thus current value) is beginning to skyrocket.

I think world markets and economics are like nature -- you can choose to ignore or not understand the laws, but they don't ignore you.

I would much like to be better educated though, so I'm following with interest the various arguments (and various definitions) regarding inflation, deflation, recession, depression, and stagflation.

I fear we're in for a long slow slide, where we first cannot augment, then cannot replace, and finally cannot even maintain the infrastructure we have, due to increasing foreign obligations and decreasing domestic wealth and productivity. Somebody passed along the term "catalytic collapse" that seemed to well-capture this notion.

I think you mean catabolic collapse:


Me, I'm leaning toward "No, printing money won't work." You still have to get it into circulation somehow, and Helicopter Ben doesn't have enough helicopters. Credit is drying up, and it would take an awful lot of new money to make up for that

Getting money into circulation is very easy:

1. Pass Stimulus bills first one in May delivered $170 Billion directly to the public (a second much larger bill is in the works)
2. Bailout the banks. So far the Fed has loaned out $400 Billion and the US treasury dept is about to get in on the action (Paulson has asked Congress for a $796 Billion credit line)
3. Pass new spending bills such as a $400 Billion Farm aid bill and a $200+ Billion Highway bill

These are things that just happened this year or about to happen later this year. The gov't can find unlimited ways to get money into circulation.

"Leenan: Never under estimate the power of the Dark Financial side"
--Darth Vernanke

Banks don't want to give loans even to good customers, for good investments. And I think it's only going to get worse

You're simply not looking forward enough. While Credit is likely to get much worse in the short term, the gov't isn't going sit idle creating millions upon millions of angry voters. Keep in Mind that 850+ Banks failed between 1990 and 1992, Yet the gov't was able to prevent deflation. How did they do it? Lots of bailout money and stimulus bills. The US gov't motto for the past 30 years is "why solve a long term problem when a short term patch will work". The last short term patch will be printing trillions or quadrillions of Dollars.

Well, this is basically where the disagreement between the inflation vs. deflation camps is. Will all that be enough?

I think it won't be. I could be wrong, but it's not like I haven't considered it. I just don't think it will be enough.

The problem is that where both camps agree is on a depression of a magnitude as great or greater than the 1930s. Yes, the guv can take money and throw it around at an even greater extent than in the past but this is the sign of a very sick economy, structurally speaking. I haven't seen any logical arguments rebutting a total collapse of the currency-the only possibility IMO is a relentless gradual decline helped along by Europe and Asia (providing gradual support).

It's not just quantity of money. Velocity of money has a role and there's not yet been a test of maximum velocity in an electronic context.

Deflation, inflation aren't useful terms. People think that maybe the guv can counter housing price deflation by devaluing the currency, but that only helps your home if you, your neighbours and potential buyers of your home have access to more devalued currency. If the currency is devalued 50% and your income goes up 2%, maybe after this bust your home value might go up 2%. The areas with foreign interest will go stratospheric-the USA still has more great real estate than anywhere else.

Thanks for all the insightful replies.

The reason I'm so curious is that I told my father to sell his shares a while back when the share market was at its peak and put it into a savings account instead.

He didn't listen to me and has now lost around 25% of the value.

I'm still pressing him to sell them as I think the financial fallout is far from over (especially when you factor in peak oil). However, this action may now only be prudent if we are heading into a deflationary period.

I don't want to press him on it only to cause him to loose more money.

Even if the USA heads into a "deflationary" period, you don't want to have a lot of your wealth tied up in US dollars.


I am from Australia, however, but peak oil will affect the global economy, so many of the same arguments should hold.

The government can guarantee loans to build out alternative energy infrastructure.

New coal to liquids plant in the US:

CONSOL Energy and Synthesis Energy Systems Form JV for Coal-to-Liquids Plant to Produce Methanol and Gasoline

the syngas will be used to produce approximately 720,000 metric tons per year of methanol that can be used as a feedstock for the chemical industry. The partners also expect that the project will be capable of converting methanol production to approximately 100 million gallons/year of 87 octane gasoline.

It should be kept in mind, however, 100 million gallons per year is only about 6500 barrel per day.

New coal to liquids plant in the US:

Yes! Let’s remove more mountaintops! No price is too large to pay so we can continue our decadent lifestyle.



Again, I must ask the question, what is so god damn valuable about our modern society that gives us the right to strip the earth of all of it’s resources without regard to the consequences? I’m glad I don’t have children.

Some religions have a directive from God to go forth and multipy and note that earth was created by God for man. So, I suppose it is a divine right to use the earth's resources.

So, I suppose it is a divine right to use the earth's resources.

You forgot to include your sarcanol tag. Someone might mistakenly think you're serious about this statement;-}

Genesis 1: ""Be fruitful and multiply and fill the earth and subdue it and have dominion over the fish of the sea and over the birds of the heavens and over every living thing that moves on the earth."

The earth is full and generally subdued, with full dominion over living things. Mission accomplished. Let's look further, shall we?

Isaiah 24 has a pretty bleak view of the earth's end, but that doesn't help much with what was expected in between.

Psalms 8:6 gives some clues, as does Genesis 2:15.

But nowhere is there a clear message of "don't destroy the earth or its animals if you feel like it". There is however a broad base of "good stewardship" scripture that combines responsibility with prudence, wisdom, and long-term investment managing.

I'm not the sort that requires a scripture to know right from wrong in most cases, and I think it's reasonable to fill in the blanks. The Bible has plenty of positive mentions of wine while considering drunken behavior a sin, so taking a single passage to logical excess can't be reliable. Absence of a restriction does not equate to a permission.

Note that the parable of the talents covered investment versus simply burying the gold -- it didn't even bother including a fourth man who spent the money on himself or a fifth man who signed up for the public dole to add some wealth. It was supposed to be OBVIOUS that a steward would take care of his area of dominion and return value to his master.

I think we're going to take some hits when we turn the Earth back in at the end of the lease....

Hello ,
The Bible as the worlds people know it is the most published piece of literature the World has ever known. This Bible also includes the "Old Testament" or the Tanakh or Hebrew bible from which you get much if not all of your references. I have not created a graph nor a curve, I can confidently say that if you were to compare consumption habits of a great many who have read the Bible or have its tenants as the societal "religion" (Judeo-Christian) now and throughout recorded history, consume vastly more of the Earths resources then those who do not have this access or "ruling" religion. What does this mean?
You wrote:

"But nowhere is there a clear message of "don't destroy the earth or its animals if you feel like it"."

Clearly both "Testaments" are rife with mans poor choices, bloodlust and greed. There were absolutes on Mans spoiling the Gifts of Yah. Unfortunately at the inception of "Christianity" also became a highly organised opportunity to usurp those limits thru the invoking of the "Lord Jesus"(a completely fictitous character) to commit many, many violations that continue to this day. Now along for the ride (coincidently ;) was the Hebrew bible. While I have not seen some of the earliest Judeo-Christian bibles with my own eyes, I believe it has included the "New" and the "Old" for hundreds of years. I won't speculate on what the creation of this mythical "Jesus", the linking of the two books, indelibly over the hundreds of years has mean't. Looking back over those same years, an awful, and I mean AWFUL lot of damage has been done under the auspices of these two "Books". In other words I don't think those that are under those same auspices are reading them.

Man is a greedy, blood-lustful, poorly choosing creature for sure. I don't think many people argue that point, and the Bible certainly documents a lot of such behavior. I assume the Koran does as well, and probably less well-known tomes from other religions also.

I guess it all depends on what you call "damage". An awful lot of technical progress has been fostered by advocates of Christianity as well, and an awful lot of killing has been done by communists, dictators and other political religions and other spiritual religions, both of their own people and their neighbors. Not a few have attempted to exterminate each other and Christians, with varying degrees of success. Christianity so far has killed relatively few, but you hear about those few a lot. To be fair, disease and starvation kill a lot more, but those pesky Westerners have been working hard at fixing that too (but not very effectively).

I suppose if you argue that technology-driven changes, less starvation, and less disease have enabled a highly-energized and massive population to damage the earth, your point is valid. Why have Americans and other westerners consumed more? Because they could. Simple as that. People are like that.

Do you think we'd be in a significantly different point if Christianity HADN'T arisen? Other than a possible time-shift of a century or two I don't. All of our problems are deeply rooted in basic humanity, and ever will it be so. You can choose to blame a specific religion or all religions or lack of religion, but that's all political convenience. I know of no organized subset of the populace who has articulated a workable combination of technology, behavior changes, political structures, and economic engines to manage the Earth into long-term stability.

Certainly America "tries harder" than most to do well, and probably to do ill, but really I think most of the harm is unintended or bone-headed side effects of trying to do good. We seem to be a motivated bunch of idiots if nothing else. Still, I cannot name another group that is more likely to manage a soft-landing if one can be had at all, or that is more likely to try to help others down the curve as well for no reason other than altruism. The biggest problem is we're not really motivated, when we could have been for 40 years. Why? Well, unfortunately we're still human.

First I would like to say you are an excellent writer, unfortunately I am not sure if we are in agreement on some of these fundamental philosophical concepts. I do not mean to be obtuse but you wrote:
"To be fair, disease and starvation kill a lot more, but those pesky Westerners have been working hard at fixing that too (but not very effectively)."
Its my understanding based on the historical record the Judeo Christian world brought some pretty horrendous diseases to the "New World" thereby decimating millions of people in a time when perhaps only 3 quarters to a billion people existed. While I have no physical evidence, I believe it was known what these diseases would do to an unexposed society. Even if on a superstitious level.
you also wrote:
"Why have Americans and other westerners consumed more? Because they could."
I did not ask "Why?" I asked what does it mean? Perhaps the Why can get to the mean, but I sure can't.
now I did not get this that you wrote:
"Do you think we'd be in a significantly different point if Christianity HADN'T arisen?"
I never thought that Christianity had "arisen"
hatched, concocted, manipulated, undermined, hijacked. Based on the profilgate number of bibles currently in existance. Had none of the above not taken place sure it might be different. I certainly never mean't to imply that these beliefs are directly responsible any more then any Tool that Man uses to manipulate his/her environment. Unfortunately the fire that roasts the meat can also burn down the house. eh?

"The biggest problem is we're not really motivated, when we could have been for 40 years. Why? Well, unfortunately we're still human."

Ah, I think what I was refering to was the hundreds and hundreds of years of indoctrination. I am afraid 40 years just ain't going to cut it.
Please never stop asking why.

Please excuse my grammatical and syntax errors.

I enjoy discussing and bantering, and cannot claim any special skill or insight. Nor do I promise or expect syntactic or grammatical perfection.

Certainly disease was spread to the new world from the outset of travel. I assume the first visitors left syphilis behind, and smallpox not long after. I imagine these were accidental events though, regardless of the utility for later conquests.

The smallpox blankets were far worse (which was likely the lesson learned from the earlier accidents), as was slavery, though that was world-wide and multicultural. All were a long time ago and not in any way the responsibility of today's America or Europe. I don't buy into cross-generational guilt.

Today's America is of course the opposite, and IS working hard to resolve all sorts of diseases. I'm sure the millions saved far outweigh the earlier deaths numerically, but probably it is still pointless long term, if they live only to see their children starve. Still, it seems morally better, if marginal.

As for the meaning of western consumption, I think it is that the American mindset has been inordinately shaped by those who have a predisposition to explore and conquer. Both require the ability to leverage opportunity and take risks. Perhaps this adds a proclivity for excess, and a live-for-today bias? There may be no deeper meaning - it just is.

I think indoctrination comes one generation at a time, but history provides many useful guides as to how to go about it. I think most people are also biased toward "fitting in", especially during formative years, and that they have a strong built-in desire for routine, ritual, and religion. Communism (and most other political systems) very closely resemble religions, and you get similar emotional reactions if you question basic tenets of either. Communists and dictators seem to be more proficiently lethal to their own people though.

Belief systems CAN change, but it takes a lot of energy and effort. So far there hasn't been enough stress to cause most people to question their comfortable, commonly-shared, and ritually-supported daily religious activities. So they still get up from their nice warm bed in their nice big suburban house, kiss their wife and 2.1 kids goodbye, drive to work in their nice heavy gasoline car, and spend their day doing their information-related, energy-centric jobs. They eat out for lunch and drive home to consume the same 50 ingredients prepared the same ways they always have, before watching TV.

Somewhere along they worry about bills and employment and "the future", but it's not a fear-in-your-stomach worry, let alone a what-will-the-kids-eat-tonight emergency.

It'll be interesting to see what the peak-oil belief system will break down into. I bet it won't be that of the environmentalist or the early efficiency advocates, and I bet it will integrate easily into all prevalent religions just like existing western society has.

Certainly disease was spread to the new world from the outset of travel. I assume the first visitors left syphilis behind, and smallpox not long after.

Syphilis, it seems, developed in the New World from yaws, perhaps 1,600 years ago, and was waiting for Columbus and his crew.

Are you a troll? Attacking Christians and Jesus Christ as you do at least makes you a bigot.
Christians include monks and laypeople who lead austere lives and reject the accumulation of wealth and other worldly goods. Christians include numerous defenders of the poor and weak and many committed enviornmentalists (St Francis of Assisi demonstrates this stewardship).
I think the worst degradors of the planet include the capitalists on wall st and the Soviets with their 5 year plans (and you didn't find many commited Christians in either place).
As far as suggesting the Bible (New and Old) has a history of hundreds of years this is dumb. The New and Old Testaments have surviving fragments from the 2nd century (well before the time you suggest).

what is so god damn valuable about our modern society that gives us the right to strip the earth of all of it’s resources without regard to the consequences?


My top 10:

10. Flush Toilets/Curbside Garbage Collection - cause sending my waste to let someone else deal with it just feels so right.

9. Beer/Ice Cream - Like revenge, both are best served cold.

8. Professional sports - what better way to cure our feelings of inadequacy than by spending inordinate amounts of time watching people get paid for something that we wish we could do, but did not have the skill or dedication to succeed in?

7. Automobiles - cause walking, riding a bike or the bus is for chumps and freedom of mobility is guaranteed to me by the Bill of Rights.

6. Fast Food/Pre-cooked food - who has the time to cook when there's so many shows on the Food network to watch?

5. Bottled water - how do I know where that stuff from the tap came from anyways?

4. Pornography - how depressing would it be to have to rely on your imagination?

3. Discovery Channel - it's much easier and safer to watch nature on TV than to actually go outside.

2. Blogging - arguing with people on the Internet allows us to share a sense of community, without having to put on pants.

1. Wal Mart - cheap food, cheap essential stuff and cheap useless junk all located in one easy to access location with a person whose job it is to 'greet' you as enter. Some people may have a different name for this, but the term that comes to mind for most good consumers is Nirvana.


Love it!!

I wouldn't rip on the Discovery Channel myself. Makes more sense to watch it on TV if it is in some remote locale. More sense than the so-called "eco-tourism"...

Relocalization, aka localization, will afford us the ability to appreciate nature locally. Let's see, I occasionally see some ants running around on the sidewalk. And the parks have some interesting critters. But mostly just the great apes in clothing. They're everywhere right now.

I wouldn't rip on the Discovery Channel myself.

You'll notice that I also ripped on beer, ice cream, flush toilets, automobiles, pornography, bottled water, blogging and Wal Mart. When I'm not drinking tap water or eating vegetables, I've been known to imbibe a cold Guinness drought or eat a pint of ice cream (generally in one sitting!) When I'm not peeing into a bucket to capture O-NPK, I use a flush toilet. While I produce probably less than a tenth of the garbage thrown out by my neighbors, I am nonetheless dependent on the trash man to remove what doesn't go into the recycle bin or the compost pile. I try to fix my own healthy meals the majority of the time, but I enjoy a hamburger and fries if the fat content is high enough. While I don't really follow professional sports, come September, you'll find me watching NFL football on Sundays. About the only thing on this list that I've completely given up is bottled water.

So, I am not trying to pretend that I don't benefit(?) from mountains getting ripped up, or that I don't take part in activities which support this destruction. It was simply an attempt to add a little levity to another otherwise depressing doombeat.

More sense than the so-called "eco-tourism"...

I've come to the conclusion that anything that has an "eco" in front of it, or the word "green" is most certainly bad for the environment and a way for someone to make money by greenwashing. I support conservation whole-heartedly, but let's be realistic about what we are doing. We might be consuming less, but we are hardly "saving the planet".

Dang it, my rating buttons aren't working today, but this made me laugh.


My rating buttons aren't working either. This was very clever. +1

Here is the opening salvo in taking the US version of the Dolchstosslegende to the next, fatal level:

Police: Tennessee shooting suspect called Unitarians liberal

KNOXVILLE, Tenn. — Knoxville's police chief said today the man accused of a shooting that killed two people at a Tennessee church targeted the congregation because of its liberal social stance.

Chief Sterling Owen IV said today that police found a letter in Jim D. Adkisson's car. Owen said Adkisson was apparently frustrated over being out of work and had a "stated hatred of the liberal movement."

I will not be surprised if we see many similar episodes in the next few years.

This is a perfect example of why our current poisoned political discourse is a broken system. It is also a perfect example of why broadcasting tacitly approved hate speech from mainstream media outlets is not acceptable.

Here come the Brown Shirts from the 1930's (Germany)---
Disenfranchised thugs venting frustration on the progressive movement for their own social status.
Now we just need a dynamic leader like the Feurer to crystalize and bring coherence.
The State, the Corporation and the Church have already been "bundled", the classic definition of Italian fascism.

I assume you mean liberal hate speech?

I think "Unitarian liberal" is quite redundant, and a meaningless headline point. Does it really matter what crazy people are crazy about?

Apparently, what really drove him over the edge was unemployment, and a cut in his food stamps allotment.

Well, he may not be aware that it is liberals who are responsible for much of the publicly-funded social safety net (such as it is) but he might well remember that it was William Jefferson Clinton who championed NAFTA.

There is (or maybe was -- I'm probably dating myself) a radical school of thought that said that the welfare state was a band-aid constructed to pacify the poor. If you buy into this idea, liberals would not be seen as friends to the working class.

Edit: Of course, blaming the Unitarians for your plight is just plain stupidity, but we do live in an "us" vs. "them" world -- promoted ferociously by the MSM, of course.

The welfare system in the US is constructed to provide customers for supermarkets, owners of rental property, and the health care system. Without food stamps supermarkets would go out of business. Without rent subsidies even more mortgages and land contracts would be defaulted. Without Medicare and Medicaid we would see doctors and nurses lining up at the soup kitchens. There used to be a time (pre Reagan) when the government built and owned the housing for the poor, the government bought food wholesale and gave it to the poor but let the poor suffer and die so everyone else could afford health care.
On another note I never considered Bill Clinton a liberal. At best he is a moderate conservative.

Heh, I think Bush is pretty liberal, and the Governator more so. I guess it's a matter of perspective.

It surely is important to know what drives people into a killing spree.

My Dad was the organist at the First Unitarian Church in Boston when it was firebombed in the 60's after opposing the Vietnam war. (I don't think any lives were lost, just a beautiful sanctuary.) We lost a Unitarian Minister on the Selma March of a grievous headwound.. ( James Reeb, a white Unitarian-Universalist minister who worked with poor people in Boston, died on March 11, 1965, after he and two other Unitarians, the Rev. Clark Olsen and the Rev. Orloff Miller, were attacked in Selma, Ala. They had gone there, to the epicenter of the struggle for black voting rights, two days after state troopers had violently turned back a column of marchers, an event known as "Bloody Sunday." http://www.danaroc.com/guests_selma_030507.html )

My Minister from NY, Rev. Rosemary Bray McNatt is going to TN tonight as one of the UU Trauma Response Ministry (who tended to people through 9/11 as well).

Yes, 'Unitarian Liberal' is a bit redundant, but I don't mind claiming the word and staying proud of it.

Bob Fiske

No Relief from $120 Oil Anytime Soon -- or Ever, says Energy Expert

The floor is $120


don't bet on it, they want to drive oil to $80 and they might well succeed.

I wonder just who "they" are in this situation. Given that most of the owners of oil are national oil companies, just why would they want to force the price down? Now, maybe, the conservative U.S. multinational oil companies would like to cut the price of oil temporarily before the election, in hopes that their candidate would get elected, but I think the price would likely continue the steady increase after the election, if the world is actually at (or near) Peak Oil. The major oil companies might see themselves becoming little more than operators instead of owners of oil in place if the world economy fell into depression and people demanded more of a socialist government. That might happen even in the U.S., as people begin to realize that we already have a form of "socialism for the rich" what with all the subsidies for the energy companies.

E. Swanson

So much for lower prices due to the availability of “bio-fuels”.

B-99 biodiesel scarce in Twin Cities
The Associated Press
Article Last Updated: 07/27/2008 01:13:25 PM CDT

NORTHFIELD, Minn.—Locating the purest of biodiesel fuels has gotten a lot tougher for drivers of diesel vehicles in the Twin Cities.
All diesel sold in Minnesota must contain at least 2 percent biodiesel, which is usually made from vegetable oils or feed stock. Last year, two gas stations sold fuel called B-99, which contained 99 percent soybean oil. But they were forced to go back to selling the usual 2 percent blend when higher soybean prices dried up their supply.


B99 biodiesel well runs dry in Twin Cities
by Tom Weber, Minnesota Public Radio
July 20, 2008
Listen to feature audio
Drivers of diesel vehicles in the Twin Cities trying to buy the purest of biodiesel fuels have run out of easy options.


Here in Oregon, retail biodiesel has generally run between $0.30 and $0.60 above the cost of D2. Which is one reason we haven't run out. ;-)

The price isn't high because we're short on supply, but because we are short on low-cost, local feedstock and the capacity to refine it. Sequential Biofuels (http://www.sqbiofuels.com/) makes 40% of its biodiesel in Oregon from WVO (Thank you Kettle Foods! When you eat Kettle Chips, the oil used to cook them might end up in my tank!) and 10% from local Canola oil, but they don't, right now, have enough local refining capacity to meet demand, so they have to import soy-based biodiesel from the Midwest, the price of which has risen with the price of soybeans (and the price of D2).

A couple of years ago, D2 was at or just under the cost of Unleaded, and B99 was at or a bit under the price of D2. Some people here have info that suggests that gasoline prices are actually low, compared to diesel and jet fuel, whose prices have followed the price changes of crude oil more closely. (I suppose sticking it to truckers and airlines and passing on the costs to consumers is less politically risky for the oil industry than $5.00/gallon for unleaded. Grrr.)

Of course, thanks to our powerful friends from the corn belt and our tax dollars, E85 is still $0.40 or more cheaper than unleaded, but biodiesel (which has more net energy and creates more carbon reduction) doesn't get the same treatment. (Oregon DOES have a $0.50 per gallon state tax credit for B99, but you have to save your receipts and wait till the end of the year, and a lot of people don't know about it. Not the same effect as lowering the price at the pump.)

Diesel #2 sold in within the City of Portland all has to be B5, and I haven't heard of that causing any shortages, of B5 or B99. That rule is scheduled to go up to B20 at some point; it will be interesting to see what effect that has. (But, then again, shouldn't such an "automatic" increase in demand also increase the incentive to invest in more biodiesel production?)

Economy hitting the elderly especially hard ...

Social triage is underway. Cheap energy made it possible to support the disabled, the elderly, the sick, the poor, etc., in far greater numbers than in the past. No longer.

At current lwo oil prices, that is just a social choice we make.

Later, in the Great Depression II, it will be less so.


the disabled

All it takes is one wrong step to end up in this boat. I outta know.

There but for the grace of [insert preferred deity here] go us all.

Cheap energy made it possible to support the disabled, the elderly, the sick, the poor, etc., in far greater numbers than in the past.

Er, actually, it's the rapid increase in wealth and income disparity in the United States (thanks largely to the policies of Republican politicians) that has made a larger and larger portion our economy closer to that of a Third-World country.

Bankrupt the Treasury by launching a war-for-private-profit and by giving fist fulls of tax dollars to the rich and uber-rich; accelerate deregulation of the few remaining safeguards for working families; say "Yes" to any and every Corporate Welfare scheme you can think of; destroy unions and family wage jobs and substitute Wal*Mart (killing locally-owned Main Street is just a bonus); distract anyone who'll listen with Faux News, Terra-Terra-Terra!, gay marriage and guns so that they consistently vote against their own interests; systematically disenfranchise the voting rights of the rest of the poor and working class who won't vote against themselves... pretty much a sure-fire way to make sure that the only part of government that works is working to make the rich richer and screw everybody else.

And, now that we're in a crisis (no matter that it is one largely of the Republicans' own making--after all, Jimmy Carter was un-American to ask us to use less!), just start telling everybody that the social-safety net (such as it was--crumbs compared to Western Europe) is simply a luxury we can no longer afford.

No need to conserve, everyone. We'll just drill our way out of this and throw the weak, the foreclosed and anyone else who won't vote for us under the bus. Nothing to see here. Move along.

Look! Over there! Brittney!

"(thanks largely to the policies of Republican politicians)"
Republican legislators + conservative Democratic legislators = permanent majority

Hey, we're closer to having "ordinary" people travel in space.

Hello Leanan,

Thxs for your toplink:

NEPAL: Fuel shortage threat to food security

..."The problem could get worse in the hills and mountain regions where the price of food is already 10 times more expensive than in the Terai," said food trader Sharma.
Recall that I had earlier discussed the fixed physical hurdle of elevation changes and distances from seaports limiting supplies.


The Terai goes along the northern edge of the Gangetic plain. The Gangetic plain goes far into India and end at the Chure Hills (called the Siwalik Hills in India), where it goes up to 1000m immediately. It is never more than 40km wide. It ranges from 60m to 300m elevation.
60 meters = 197 feet above sealevel, 300 meters = 984 feet above sealevel. Dangboche, at the lofty altitude of 14,500 feet, is probably where the locally grown food is the mentioned 'ten times more expensive'.

Thus, the following rough calculations:

[197 + 984]/2 = 600 feet average elevation of Terai above sealevel, but people are already suffering malnutrition and worse as they cannot afford to get adequate I-NPK just 600 feet higher and from 715 miles away:

Nepal as a Transit State

..Nepal’s nearest seaport is Kolkatta in India which is 1,150 kilometers [715 miles] away....

14,500-600 = 13,900 elevation change.

13,900 feet/10 times food price = locally grown food price doubles for every 1,390 feet [424 meters] in elevation change.

Seems about right if you can imagine a Sherpa porter hiking up with a 100 lb sack of I-NPK. If postPeak Nepal went to massive O-NPK recycling plus SpiderWebRiding for I-NPK and food movement--IMO, it could help promote optimal decline. The railbikes would need really low gearing for the uphill slog, but the downhill run would be thrilling.

Could these events in Nepal be a clear warning for high altitude and far-inland farmers/gardeners in the postPeak US?

I hope farmers/gardeners in the Sierras, Rockies, and other high altitude areas are stockpiling cheap I-NPK while they can, besides composting everything possible.

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

Federal Reserve Governor Frederic Mishkin said, "energy prices can't keep going up forever."

I guess we know which way he voted on the recent TOD price poll.


Hello Izzy,

Yep, strictly speaking, prices cannot go up forever, but they sure could reach a much higher non-FF, Thermo/Gene value.

...the true value of NPK is around $210,000/ton

Under idealized conditions: a ton of I-NPK can generate 20 tons of food. That's a lot of food for a lot of families for a year. Since job specialization is dependent upon food surpluses, a successful farmer leverages the ability for our society to have brain surgeons and other non-farming jobs.

Since there are No Substitutes to NPK and the other trace Elements, the earlier Guano Wars, War of the Pacific, and the dead-heading of the bones of millions of 'immigrants' were required to keep civilization going. Recall that a minor potash embargo sent US prices to $14,500/ton [inflation-adjusted] in 1914. The current $1,000/ton spot price is a bargain.

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

didn't see this in this thread[delete if is]

Chris's "profit from the peak" book focused on on front page of yahoo finance with an interview.


There's a dedicated thread on the front page.

EIA has posted new consumption data. We now have their final revised value for May of this year.

19,729,000 bpd versus 20,620,000 bpd in May '07.

That's 900,000 less and a decline of 4.3%

We also have data for net imports.

11,056,000 versus 12,764,000 in May '07.

That's 1.7 million bpd less and a decline of 13.4%

Consumption data:

Net imports:

"We also have data for net imports.
11,056,000 versus 12,764,000 in May '07.
A decline of 13.4%"


Consumption declined 4.3% year on year. Seriously, that is a phenomenal event.
However, May 2007 average price was about $65, May 2008's was ~$125.

So a ~92% increase in price caused a 4.3% decrease in consumption.
Tells you how cheap $65 was. And for the previous 20 years it was well below that!

Do you realize that at under $30 per barrel, oil was virtually free? OPEC got shafted.

Do you realize that at under $30 per barrel, oil was virtually free? OPEC got shafted.

What do you mean OPEC got shafted? They're still exporting. However, the UK certainly got shafted.

(Consumption) That's 900,000 less and a decline of 4.3%
(Net Imports)That's 1.7 million bpd less and a decline of 13.4%

You wouldn't want too many months like that.

why not? less consumption is good right? and the decline in imports would have to do using less, or would it be due to less available oil from exporting countries?

It's not the decline in consumption that's the problem but you'd soon run out of crude to feed the refineries with such a huge drop in imports relative to consumption.

datamunger - are you cheering the fact that tens of thousands of low income people here in the US are now priced out of fuel?

You sir are an a$$.

Move on.

You are on the wrong trajectory. Do you understand this?


This is not the great news you think it is.

It represents average people who, thanks to people like you who tout "all is good and tech shall deliver", comming up against the hard wall of reality.

The story is about extreeme hardship and loss, but hey you see it as "hell yes, the free market works, three cheers".

Well EFF you buddy.

You Need To Pay Better Attention.

Re: Fans of L.E.D.’s Say This Bulb’s Time Has Come

The idea that you would light a factory floor with LEDs is truly absurd. A 6-lamp, 32-watt T8 fluorescent fixture equipped with two high efficiency, 1.18 BF electronic ballasts supplies 21,948 initial lumens for 222-watts -- 98.9 lumens per watt (Osram Sylvania XPS lamps/Quictronic QTP ballasts). A $2.50 XPS lamp provides 36,000 hours of service, a CRI of 85 and 93+ per cent lumen maintenance. The lamp and energy costs per 1,000,000 lumen-hours at $0.12 per kWh is about $1.25. Any guess as to the cost per million lumen-hours for an equivalent LED fixture suitable for an industrial environment?

Depending upon fixture height, the nature of the work performed within this space and various other factors, a 10,000 sq. ft. shop floor might require something in the order of 1.5 million lumens of light, or what would be supplied by 70 of the aforementioned fixtures. Our hardware costs, in this example, assuming a cost per fixture of $150.00, is $10,500.00. For an equivalent amount of light, how much would I need to spend to illuminate this facility with LEDs?


a lot up front, than nothing for about 20 years.

Hi Encinitas,

If you're referring to any expected savings related to longer lamp life, I think you'll find the 32-watt T8 to be the hands down winner. Assuming this factory operates 6,000 hours per year, a 36,000-hour rated lamp should theoretically last about six years. If the replacement cost is $2.50 per lamp, the cost per lamp, per year, is a little less than 42-cents; for a facility with 420-lamps, that's $175.00 a year. If we budget an additional $1.50 per lamp for labour related charges -- $9.00 per fixture -- that adds another $105.00 per year to the mix, for a combined total of $280.00 per year.

A good quality LED lamp might have a nominal service life of 50,000 hours based on a 70% lumen maintenance factor; i.e., the point at which light output is no longer deemed sufficient (note that at EOL, a T8 fluorescent would still be cranking out roughly 90% of its initial lumens). And at 3,600+ lumens per lamp, how many LEDs would we require to equal the light output of a single T8? Two? Three? Four? I would expect the cost of LED lighting in this type of application to be many times that of T8.


But can the T8 do this? ;-)

Watergate, Berlin

Hi trichter,

Well, you got me there. I'll keep this Simpsons clip in mind the next time I design a factory floor system: =:-O



How many union guys does it take to change a lightbulb?

UPDATE 3-Biofuels major driver of food price rise-World Bank
Mon Jul 28, 2008

World Bank economist Don Mitchell concluded that biofuels and related low grain inventories, speculative activity, and food export bans pushed prices up by 70 percent to 75 percent.

"The large increases in biofuels production in the U.S. and EU were supported by subsidies, mandates and tariffs on imports," Mitchell said in the research, which looks at rapid rises in food prices since 2002. "Without these policies, biofuels production would have been lower and food commodity price increases would have been smaller."

Mitchell, however, said Brazil's sugar-based ethanol did not push food prices appreciably higher because Brazilian sugar cane output increased and sugar exports nearly tripled since 2000.

Meanwhile, the US is busy producing more ethanol, taking more farmland away from food production, pushing food prices even higher.

In May 2008, the US produced 18.54 million barrels ethanol (620 kbd), up almost 50% from a year ago on May 2007 at 12.57 million barrels (410 kbd).

Food prices will keep increasing.

The program, known as the Advanced Technology Vehicles Manufacturing Incentive Program, was meant to help automakers meet fuel economy standards of 35 miles per gallon by 2020.

This is after the Partnership for a New Generation Vehicle, a public/private partnership where we gave the Big 3 $1.2 BILLION DOLLARS to create fuel efficient vehicles. They made prototypes of family cars that achieved between 72 and 80 mpg, but when Bush took office, they asked for the program to be killed, because they didn't want to look like hypocrites for pushing high margin SUVs instead...


Part 3 of the WaPo story is now up...

A Century After a Rush, Global Supply Is Tapping Out

Kern River is the story of America's oil supply. Four decades ago, the United States was the world's biggest oil producer. But U.S. crude oil output peaked in 1970, at 9.6 million barrels a day, which was enough to cover the bulk of the country's needs back then. Now, U.S. crude production stands at 5.1 million barrels a day. Together with liquids derived from natural gas and other inputs, domestic production covers only 42 percent of the country's needs. The balance comes from imports. Ever since President Richard Nixon called for "Project Independence" in a 1973 address to the nation, U.S. energy independence has been little more than a throwaway line in political speeches.

The United States is at the leading edge of what may lie ahead for worldwide oil production. Global petroleum output is still rising, but the rate of growth is slowing. Supply is not increasing fast enough to keep up with soaring global demand, putting ever more upward pressure on oil prices.

According to the IEA, world oil production was 84 million barrels a day in 2005. In 2008 it is published as 87 million barrels a day and forecast to expand in 2009 on non-OPEC growth and strong OPEC NGL production growth. So far this fits with the ASPO forecast for world peak oil production in 2010.


Higher gasoline prices may result in greater stock builds in OECD nations. If the price falls to low then we might get increased demand and OPEC cuts. Currently OPEC has stated it is in favor of continued production without cuts.