DrumBeat: September 27, 2008

Lehman-Backed Muni Gas Bonds Trade for Cents; Deliveries Halted

(Bloomberg) -- Tax-exempt bonds guaranteed by Lehman Brothers Holdings Inc. for a gas-supply contract may be worth little more than unsecured debt after the bankrupt underwriter's commodity unit stopped deliveries last week.

Main Street Natural Gas, a financing vehicle of the Municipal Gas Authority of Georgia, terminated the contract funded by $709 million in bonds sold five months ago, after Lehman's subsidiary failed to deliver gas for five days beginning Sept. 18. New York-based Lehman, which filed for bankruptcy on Sept. 15, owes a termination payment that would provide enough money to redeem the bonds Sept. 30.

``We don't expect payment due to the bankruptcy, so the bondholders will likely join unsecured creditors in bankruptcy court,'' said Susan Reeves, chief financial officer of the Kennesaw, Georgia-based authority, which provides gas for municipalities from Florida to Pennsylvania. ``We don't believe any other avenue is likely at this point.''

The utilities that received gas from the deal, including Tallahassee, Florida, lose the savings from market price that the tax-exempt financing created for them. The default may also damp issuance of similar bonds through which local entities lock in long-term energy supplies at a discount through deals backed by financial firms, according to Merrill Lynch & Co.

Senate sends big spending bill to Bush to sign

WASHINGTON - Automakers gained $25 billion in taxpayer-subsidized loans and oil companies won elimination of a long-standing ban on drilling off the Atlantic and Pacific coasts as the Senate passed a sprawling spending bill Saturday.

Kicking oil habit harder than they say

ORLANDO — Barack Obama and John McCain are promising voters a Tomorrowland of electric cars and high-speed trains and solar panels, a vision of American life without a drop of imported oil.

But their plans to get there look more like Fantasyland.

We can't have cheap oil and alternative fuels

On the campaign trail, some candidates are taking an "all of the above" approach to energy policy. They want us to "drill, baby, drill" and promote other renewable energy sources, too.

At first, this seems appealing. Energy is a big problem, and who doesn't want to look at all the solutions? Yet, as anyone who has ever taken a multiple-choice test knows, "all of the above" isn't always the right answer. What if your doctor took an "all of the above" approach to your health care? He or she might advise both watchful waiting and immediate surgery. Or what if the quarterback took the snap and decided to simultaneously hand off and pass?

An "all of the above" approach doesn't work when the options are fundamentally incompatible. That's why the "all of the above" or so-called "balanced" energy policies out there don't make sense. We can't "drill, baby, drill" and become leaders in alternative energy.

Bond measure offers rebates for greener vehicles

T. Boone Pickens, the Texas billionaire oilman who says he wants to break America's addiction to foreign oil, is betting that Californians are willing to help pay for cars and trucks that don't run on petroleum.

Pickens' natural gas fueling company, Clean Energy Fuels Corp., is the chief sponsor of a Nov. 4 ballot initiative that authorizes a $5 billion bond to fund alternative energy development and provide rebates up to $50,000 for buyers of vehicles that run on natural gas and other non-petroleum fuels.

Lester R. Brown: Mobilizing to Save Civilization: What You and I Can Do

One of the questions I am frequently asked when I am speaking in various countries is, given the environmental problems that the world is facing, can we make it? That is, can we avoid economic decline and the collapse of civilization? My answer is always the same: it depends on you and me, on what you and I do to reverse these trends. It means becoming politically active. Saving our civilization is not a spectator sport.

We have moved into this new world so fast that we have not yet fully grasped the meaning of what is happening. Traditionally, concern for our children has translated into getting them the best health care and education possible. But if we do not act quickly to reverse the earth’s environmental deterioration, eradicate poverty, and stabilize population, their world will decline economically and disintegrate politically.

Mark Lynas: the green heretic persecuted for his nuclear conversion

Just a month ago I had a Damascene conversion: the Green case against nuclear power is based largely on myth and dogma. My tipping point came when I discovered just how much nuclear power has changed since I first set my mind against it. Prescription for the Planet, a new book by the American writer Tom Blees, opened my eyes to fourth-generation “fast-breeder” reactors, which use fuel much more efficiently than the old-style reactors, produce shorter-lived waste and can also be designed to be “walk-away safe”.

Best of all, these new reactors – prototypes of which have already been tested – can produce power by burning up existing stocks of nuclear waste. As Blees puts it: “Thus we have a prodigious supply of free fuel that is actually even better than free, for it is material that we are quite desperate to get rid of.” Who could object to that?

Don’t Dump The Deal

Should Congress abandon the nuke pact now, Americans, not Indians, will end up isolated.

Yemen rounds up tribesmen after oil pipeline blast

SANAA (AFP) - Yemeni security forces arrested more than 10 tribesmen east of the capital Sanaa after an oil pipeline was blown up, tribal sources said on Saturday.

The men from the Al-Suhman tribe were rounded up in Khawlan, 50 kilometres (30 miles) from Sanaa hours after the pipeline was blown up on Friday morning, the sources told AFP.

Sharon Astyk - Peeling the Onion: What’s Behind the Financial Mess?

I’m going to suggest that if you peel off the layers of the financial crisis, we’re going to find some pretty basic things. And one of the basic things is, well, food. It seems sort of anti-climactic, I think, if you are a pundit, to talk about the cost of rice and soybean oil as part of the root problem of such a massive financial crisis, but I suspect we’ll find it there. And underneath the food, I think we’ll find oil.

Atlanta Thirsts for Gasoline After Gustav, Ike Cut Fuel Supply

(Bloomberg) -- Hurricanes Gustav and Ike are making their presence felt in the U.S. South almost two weeks after the last of the storms slammed the Gulf Coast, as evidenced by the gas lines in Atlanta.

At a Shell gasoline station this morning in Atlanta's Midtown district, about 25 drivers waited for a chance to pump what's become a rare commodity. The line clogged a side street, causing backups on Peachtree, the city's main thoroughfare.

Gas shortage impacting local-government services

City workers have been coming in at odd hours, often late at night, to get fuel while the getting is good, Ferry said. Police officers are on duty 24 hours a day, of course, "and can fuel the extra cars anytime," Ferry said.

When it is safe to do so, the water department meter readers have been making their rounds on electric golf carts, Ferry said. And nonessential travel for staff has been curtailed.

Businesses in bind over gas shortage

Chancey's Wrecker Service has seen a surge in business - gas deliveries and out-of-fuel tows.

And because fuel is harder to find, it's stopped bringing gas to stranded motorists, instead towing them to their residence or a gas station. Workers did 20 tows Thursday, said Joanne Scott, a secretary and dispatcher.

The gas shortages are straining businesses in the area, especially those making deliveries or servicing clients in the field.

Gas could stabilize in weeks

Ryan Mossman, the vice president and general manager of fuel management for Houston-based FuelQuest, said Oct. 13 -- Columbus Day -- is a good target date for the Augusta area's supply woes to wane.

It takes seven days or more to restart a refinery, Mr. Mossman said.

Then it takes four to six days for the gasoline to travel 900 miles from Texas to the North Augusta terminal, where most of the gas stations in the Augusta-Aiken area normally get their supply.

"It travels about 3 to 5 miles per hour," Mr. Mossman said.

Drivers Camp Out At Gas Station Waiting For Fuel

CHARLOTTE, N.C. -- The gas shortage is so severe that people are sleeping in their cars.

Thursday night, dozens of drivers snoozed in their cars yards from gas pumps as stations across the Charlotte area waited for gas shipments.

“I was told last night between 11 and 12; then I was told this morning,” said Kelly Davis, who sat in her car at the Citgo on Lawyers Road.

Davis is stuck in Charlotte. She came to the Queen City for a vacation and can't get back to her home in Pennsylvania. She was supposed to return Thursday.

Forsyth retailer balks at 'ridiculous' prices for gas

CUMMING – The executive who buys gasoline for BJ's Wholesale Club stations, including one in Cumming, won't pay prices he labeled as ridiculous when he knows they will drop in just a few days.

"Wholesalers would not sell product to unbranded retailers in Georgia, therefore we ran out of product in Cumming for nearly three days," said Scott Margherio, BJ's Warehouse Club vice president of Fuel and Auto Operations. "Even if we could find product, BJ's would not attempt to pass on a $1.60/gallon cost increase to our members, therefore we would rather be out of product than procure product at suc

Lessons hurt the worst when learned in crisis

I think by now saying that we have a little bit of an energy problem in the U.S. isn't a great leap of faith.

These past two weeks have been a delightful reminder of such economic theories as supply and demand, scarcity, and survival of the cattiest. Luckily, most of us probably didn't break out in a fight in line to buy gas, but reports of it did circulate.

We can keep gas if price not right, Iran tells UAE

TEHRAN (Reuters) - Iran said on Saturday it would sell gas to Crescent Petroleum of the United Arab Emirates if the price previously agreed was raised but is building facilities so it could use the fuel at home if not.

Oil Minister Gholamhossein Nozari also told Fars News Agency a Pakistani team would visit Iran in days for talks on another gas export project that has been under discussion for years.

Iran, the world's fourth largest oil exporter, has been slow to develop gas exports despite huge reserves partly because U.S. sanctions have hindered the building of plants to make liquefied natural gas (LNG) for shipment. Iran now relies on pipelines.

Kyrgyz Government Considers Buying Turkmen Natural Gas - PM

Bishkek, 26 September: Kyrgyzstan's current debt to be paid to Uzbekistan for natural gas is about 2m dollars, Prime Minister Igor Chudinov said in parliament today during the discussion of an issue related to preparing economic sectors and the country's people for the autumn and winter periods of 2008-2009.

An MP from the faction of the Social Democratic Party, Murat Dzhurayev, said that if Kyrgyzstan bought natural gas at 300 dollars this year it needed over 210m dollars or 8bn soms to buy it. The MP also asked how much Kyrgyzstan owed to Uzbekistan for natural gas.

Lights out: Lebanon faces looming power crisis

Oil prices have tripled since 2004. Electricity outages have doubled in Lebanon since 2005. Lebanon's electricity utility has been vulnerable to crude oil price shocks than ever. Consumers and businesses are spending two times their electricity purchase in this staggering situation. Josephine Nassralla conducted the following interview for The Daily Star with energy expert Roudi Baroudi about this crucial element of Lebanon's economy and the sector governance.

The 2008/09 Agricultural Season Fertiliser Shortage

A farmer in Zimbabwe this season will pay U$$ 1.08 per kg of fertiliser as compared to US$0.45 per kg for his counterpart in a neighbouring functioning economy. Therefore, to plant one hectare of maize the farmer will fork out US$594.00 per hectare, assuming the rains are good, the seedbed is perfect and germination is within the acceptable 95-99% range. However most farmers will have to replant or embark on “gap filling” because there is never a perfect season.

A sixty-horsepower tractor requires 35 litres of diesel per hectare to plough one hectare of land and then another 20 litres per hectare to disc with a harrow. 10 litres per hectare is further required for planting. The fuel requirement for a single hectare becomes 65 litres of diesel, which costs US$2.05 per litre in Zimbabwe. Therefore US$133.00 per hectare is required for land preparation without accounting for combine harvester costs.

World-class Vancouver also has a dark underbelly

Sprawling suburbs emerged after the Second World War in response to unprecedented population growth (more than four billion globally since 1950), an abundance of cheap oil and the proliferation of the automobile. With peak oil on the doorstep, we're finding that the great American dream of a large single-family home on a big lot far from the city centre no longer makes sense. Why not?

First, the cost of providing and maintaining infrastructure such as sewers, electricity, garbage pickup, roads and street lights is high because suburbs are widely spread out. Taxes do not recover these costs, so municipalities are caught in a bind: The faster they grow, the poorer they become. The escalating price of oil only hastens the financial drain.

Mexico-led $7bln Centam refinery project in jeopardy

MEXICO CITY (Reuters) - An ambitious Mexican-led project to build a $7 billion oil refinery in Central America is under threat after potential builders backed off from the project this week.

An international bidding process led by a unit of Mexico's state oil company Pemex concluded on Monday with none of the four qualified companies presenting offers for the project, Mexico's energy ministry said on Thursday.

Guatemalan Energy Minister Carlos Meany told Reuters the failure of the bidding process after months of delays could lead to the project being scrapped.

Financial crisis feeds volatility in oil

KUWAIT CITY: US crude dived below the US$100 per barrel mark for the first time since 27th Feb 2008 to settle at US$91.49 per barrel on 16th Sep 2008, before recovering to US$104.55 per barrel on 19th Sep 2008. US crude fell 8.6% during the review period (Aug 19-Sep 19, 2008). Worldwide credit crunch in the aftermath of subprime crisis, appreciation of the US dollar to a one-year high against the Euro, minimal damage from Hurricane Gustav overwhelmed the geo-political risk arising from conflict in the Caucuses and potential damage by Hurricane Ike to pull down crude prices to a seven month low on 16th Sep 2008.

Energy expansion costs soar in Gulf region

Dubai: Tightening credit conditions in the world's top oil exporting region are raising the cost of expanding energy capacity and adding to delays but are unlikely to derail strategic projects.

Interbank lending rates have risen across the Gulf Arab region as global financial turmoil has left banks struggling to finance expansion of infrastructure, real estate and industry.

Unstable economy raises energy prices

Olivier Jakob at Petromatrix, Zug, Switzerland, said, "The Washington soap opera is taking so much of traders' attention that market liquidity is coming off." He noted that trading volume was "relatively low" Sept. 24 in the New York market despite the release that day of the latest Department of Energy report on US inventories. "Open interest continues to decline to new lows for the year and soon to new lows for 2 years," Jakob said. "All the main commodities are in a declining trend of open interest. With so much public outrage on the Wall Street bailout, we see little chance that the commodity futures market will be able to escape a regulatory change, and the more commodity prices increase, the more immediate the risk becomes."

Nonetheless, the financial rescue plan in Washington "seemed to be a done deal until the candidates [Sen. John McCain (R-Ariz.) and Sen. Barack Obama (D-Ill.)] invited themselves to the show," said Jakob. "The easiest way to become an overnight leader is to break a deal and then become the savior of it. The latest political debacle will not help consumer sentiment."

Even if the plan is passed, it will do nothing to improve oil demand. "This plan is a rescue plan to prevent a collapse of the financial system and not a plan to boost the economy," Jakob said. "The rescue plan's impact on the economy will be a lengthy process and will not immediately put the US driver back on the road."

Norway Finds Virtue (and Value) in Transparency

FED by its vast North Sea oil riches, Norway’s 10-year-old sovereign wealth fund, called the Pension Fund, has grown to more than $400 billion under management. It ranks as the world’s second-largest sovereign fund behind the $875 billion Abu Dhabi Investment Authority.

The Pension Fund is managed by the Central Bank of Norway, and only 4 percent a year goes into the country’s budget. Yngve Slyngstad (pronounced ING-vay SLING-stad), who became the fund’s chief executive in January, has witnessed firsthand how the market’s latest convulsions affect a fund of this magnitude.

Venezuela, Russia in $1 Billion Accord

MOSCOW -- Russia announced ambitious plans Friday to enhance its armed forces and nuclear arsenal while extending a $1 billion loan to Venezuela to purchase arms and exploring the possibility of forming a gas cartel with the Latin American nation.

Speaking during a meeting with commanders following military exercises in southern Russia, President Dmitry Medvedev cited the nation's recent war with Georgia in calling for an urgent drive to upgrade Russian military capabilities within 12 years, including the country's ability to deter nuclear attacks.

Adak's woes continue as RCA pulls city's utility certificate

Since July, the city has had intermittent problems getting fuel from the Aleut Corp. because the city was in arrears on paying the corporation's subsidiary, Aleut Enterprises, for the fuel, said city clerk Chrissy Dushkin.

Meanwhile the Aleut Corp. was in arrears paying sales tax to the city, “because they wanted to deduct it from our (fuel) bill,” Dushkin said.

Dushkin estimated that the city owed Aleut Enterprises about $500,000 for fuel, a debt that in part was the result of Adak Fisheries owing the city upward of $600,000 in sales taxes and utility bills.

Refinery talks loom as BP shuns replacement workers

HOUSTON (Reuters) - BP, which has worked to mend relations with unionized workers since a deadly refinery explosion, will not have replacement refinery workers on hand going into contract negotiations late this year, a company spokesman said.

If talks with the United Steelworkers union break down, leading to a nationwide work stoppage, BP plans on halting production at its four union-represented refineries in California, Indiana, Ohio, and Texas, said BP spokesman Daren Beaudo.

Saudis using oil as a weapon against Iran?

A Business Week article on Saudi Arabia portrays a kingdom eager to pump oil far above its OPEC quota despite a rapid decline in the price of oil on the world markets. This places them in an adversarial relationship with Iran and Venezuela - two allies. Why might the Saudis engage in this practice? One, is they want to prevent a collapse in demand that might bring about a harsher collapse in prices.

However, there might be another reason: to destabilize Iran, an arch-foe of Saudi Arabia. Iran is a Shiite power intent on achieving hegemony throughout the Middle East. Saudi Arabia sees itself as the leading Sunni power and a protector of two of the holiest sites of the Sunni branch of Islam (Mecca and Medina).

Entergy spent $480,000 lobbying government in 2Q

Utility giant Entergy Corp., whose operations in Louisiana, Texas and Arkansas, were devastated by hurricanes Gustav and Ike this month, spent $480,000 in the second quarter to lobby on disaster assistance for power transmission and distribution facilities and other issues, according to a recent disclosure report.

Entergy also lobbied on low-enriched uranium, energy legislation, greenhouse gas emissions, renewable energy and plug-in electric vehicles

The wind at his back: George Smitherman's green-energy odyssey has minister `jazzed' over Ontario's potential

NIAGARA FALLS–In just nine weeks George Smitherman has likely learned more about the green-energy industry than any energy minister before him, and then some.

Two-wheel drive: Wheeled Migration takes on 500 miles of roadways, and that’s just the beginning

So for about the 30 Wheeled Migration riders who rolled into Cal Poly for the CSU/UC/CCC sustainability conference, it was the journey, and the surprises along the way, that made the trip so special.

“The conference was nothing compared to the ride,” insisted Michelle Wurlitzer, a Butte College sophomore, who, despite her relative biking inexperience, was determined to complete the trip.

Oil, or What? Life After Capitalism

Cheney and every other politician have said we are "addicted" to oil. And it all comes down to one question, ultimately, though it is a large one: can we kick the habit? Is it even possible to find a substitute resource and convert our entire industrialized world to it? And if not, what else must happen if we are to avert the transformation of our planet into a facsimile of silent, dusty Mars?

It isn't just driving cars and heating homes that makes us oil-junkies. Look around you, wherever you are right now. What do you see? What is it made of? My desk is a laminate surface on glued-together sawdust: flakes of wood and petroleum products shaped into a flat work surface. My keyboard is petroleum-derived plastic, as is almost everything connected to it. My shirt is cotton, but half my underwear is made of petroleum-derived synthetics. The cotton in my shirt no doubt was harvested, shipped, processed, woven and sewn by oil-driven machines, themselves made from metals produced at a high petroleum-based energy cost, and operated by underpaid and endangered human beings who could not afford to buy their own products in the stores.

Elon Musk conducts on-line Q&A at WashingtonPost.com

Washington, D.C.: Should not NASA be funding research to make Space Solar Power possible in this time of energy crisis as they did in the 1970’s?

Elon Musk: No, I don’t believe in space solar power. It will never be competitive with ground solar power. The cost of converting the electron energy to photon energy and then back again on the ground overwhelms the 2X increase in solar incidence. And that’s before you consider the cost of transporting the solar panels and converters to orbit!

Washington, D.C.: What do you think of the future of Space Solar Power, especially built with Lunar Materials?

Elon Musk: Only good for people living on the Moon.

Climate change experts seize the day: Oct. 7, 2008

Hansen's message, titled "Target Atmospheric CO2: Where Should Humanity Aim?" will be presented to scientists gathering in Houston, Texas, USA, on 5-9 October for the 2008 Joint Annual Meeting of the Geological Society of America (GSA), Soil Science Society of America (SSSA), American Society of Agronomy (ASA), and Crop Science Society of America (CSSA), the Gulf Coast Association of Geological Societies (GCAGS) with the Gulf Coast Section SEPM, and hosted by the Houston Geological Society (HGS).

Hansen's lecture will be broadcast live online (CDT) at https://www.acsmeetings.org/programs/events/gsa/.

Gas shortages: get ready for more: The long lines and closed pumps seen across the South this week are a warning: inventories are way too low

...In its most recent Weekly Oil Data Review, Barclays Capital pointed out that the U.S. gasoline inventory has reached its lowest level since August 1967, when demand was a little more than half its current level of 9.3 million barrels a day. At 178.7 million barrels, inventories are 21.6 million barrels below their five-year average.

None of this surprises industry watchers such as Matt Simmons, the chairman of Houston energy industry investment bank Simmons & Co. and chief spokesman for the Peak Oil movement. I recently wrote a profile of Simmons for Fortune ("The prophet of $500 oil") and I can report that he has been warning about the potential of gasoline shortages in the U.S. for months.

"Our system is so fragile," he told me recently. "All you need is a tiny change to go from 'Oh, we're in fine shape' to an unmitigated disaster."

Simmons points out that the gasoline weekly stock reports have been trending sharply downward since last winter (with a brief upturn in the spring), and that even before Gustav and Ike we were in "just in time" supply mode.

Getting back to a safer level of extra capacity isn't simple, either. Once the refineries get back up and running, they'll drain the already low crude oil inventories. Unless gasoline demand stays low, Simmons believes, we'll have a hard time clawing back to stability.

That's why he worries about a top-up catastrophe that could cripple the trucking industry and disrupt food deliveries.

As he told me the other day: "If we end up having gasoline shortages, the odds are about 90% that Americans will do what we always do: We'll top up our tanks. And in topping up our tanks, within three or four days we'll drain the pool dry and then within seven days we'll run out of food."

The future of energy

LONDON, England (CNN) -- While many of the world's best business brains are exercising themselves over the current global banking and equities crisis, there is another issue which has the potential to dominate our lives far more in the longer term -- energy.

Fossil fuels will not last forever, and the race is on to find viable replacements which will keep the globe moving by the time oil, coal and gas stocks run dry, or at least before they become ruinously expensive.

Gas shortage wipes out weekend across the South

RALEIGH, N.C. - This is how serious the Southeastern gas shortage has become: There's talk of calling off college football.

Not serious talk, of course. A petroleum executive's suggestion that No. 3 Georgia postpone its Saturday night game against No. 8 Alabama was quickly dismissed Friday by the Georgia governor's office as "ridiculous."

But the university's police chief did suggest fans who can't make a round trip to Sanford Stadium on a single tank stay home.

Weeks after Hurricane Ike shut down Gulf Coast refineries and dried up interstate pipelines, some panicked drivers are still waiting in long lines to top off their tanks at the few stations with fuel.

Many across the Southeast are keeping their cars in the garage this weekend, forced to cancel plans for fear they'll run out of gas.

Oil market collapse waiting to happen

The New York Mercantile Exchange (NYMEX) West Texas Intermediate (WTI) crude oil market price has become almost entirely irrelevant in the real world of physical and forward oil trading, which largely takes place, believe it or not, in Yahoo chat rooms. While NYMEX members still provide a massive pool of trading capital or "liquidity", the inconvenient truth is that oil market pricing power has moved across the Atlantic to the price of North Sea crude oil.

Russia to build missile defence shield and renew nuclear deterrence

Russia is to build new space and missile defence shields and put its armed forces on permanent combat alert, President Medvedev announced yesterday.

In a sharp escalation of military rhetoric, Mr Medvedev ordered a wholesale renovation of Russia’s nuclear deterrence and told military chiefs to draw up plans to reorganise the armed forces by December.

He said that Russia must modernise its nuclear defences within eight years, including the creation of a “system of air and space defence”.

U.S. weighs measures against Russia - Rice

NEW YORK (Reuters) - The United States is mulling what measures to take should Russia exploit the oil or minerals of two Georgian breakaway provinces it invaded last month, U.S. Secretary of State Condoleezza Rice said on Friday.

Oil wealth fans ethnic flames in Iraqi town

KHANAQIN, Iraq: In a mirror image of Kirkuk, the Kurdish town of Khanaqin near the border with Iran that holds sizeable oil reserves is being exposed to ethnic tensions and rival territorial claims.

The local Kurdish political leadership warns that the area could see an ethnic explosion, as they call for Khanaqin to join the adjoining autonomous Kurdistan Regional Government (KRG) of northern Iraq.

New York expands probe of short selling

ALBANY, N.Y. - New York Attorney General Andrew Cuomo is broadening his investigation of short selling on Wall Street, according to a senior official in his office.

Cuomo is turning to the massive credit-default swap market, which he believes may have been manipulated in order to give the impression that certain companies were in trouble.

Gas protest aims to ignite debate

Protesters are set to rally outside British Gas' Cardiff headquarters to demonstrate against energy price rises and the increasing economic crisis.

The People Before Profit Alliance are unhappy at the company's recent price rises but want its event to launch a public debate on the failing economy.

British Gas raised its electricity and gas prices by 9% and 35% in July.

Small is beautiful for carmakers

New car registrations fell by 7.3 percent in July and 15.6 percent in August compared with a year ago because of a general deterioration in consumer confidence and the effect of continuing high fuel prices. Over the first eight months of the year, new car registrations in Europe fell by 3.9 percent.

In Brazil, carmakers expect sales to slow in the second half after a spike in July. In Russia, August sales of imported cars were up 23 percent but that compares with the 40 percent of July. China's car sales fell 6.34 percent in August.

Natural gas: The next alternative fuel?

We've written about hybrids, clean-diesel engines, fuel-cell technology, ethanol and more.

That brings us to another entry in the auto industry's ongoing research and development of green-technology: compressed natural gas (CNG). Scientists are trying to determine which alternative fuel will best strike a balance between being environmentally friendly and commercial viability.

CNG might be the answer.

Coal Country: Washington Ups Support for Coal, Clean or Not

Most of the attention focused on the energy bills languishing in Congress homes in on the long-awaited renewal of tax credits for clean energy.

But there’s another fight brewing under the surface: The battle over coal. Both in the U.S. and overseas, figuring out a way to keep using coal has become a central plank in energy policy—including subsidies. Whether that coal is “clean” or not seems secondary.

France plans to end biofuel tax breaks by 2012

PARIS (Reuters) - The French government said on Friday it will phase out tax breaks for biofuels by 2012, arguing that higher oil and grain prices have removed the need for fiscal support.

Canada: Tories to put curbs on bitumen shipments

CALGARY - The Conservatives yesterday promised to prohibit oil companies from shipping bitumen from Canada's oil sands to countries that do not have equivalent greenhouse gas emission reduction targets --if they form government after the October election. One industry-watcher has already branded the policy as meaningless.

Rich nations' greenhouse gases fell in 2006: survey

OSLO (Reuters) - Rich nations' greenhouse gas emissions dipped for the first time in five years in 2006, easing 0.1 percent despite robust economic growth, a Reuters survey of the latest available information showed Friday.

The figures were less gloomy than a report this week, based on scientist estimates to 2007, which said world emissions were surging, led by rocketing growth in poor countries such as China and India twinned with a tiny rise by industrialized nations.

Real alternatives on climate issue

A year ago, Australian voters feeling the impact of drought placed climate change front and centre in their election – and ousted a right-leaning government that had ignored the issue. No sign of that here.

Canadians also claim they care about global warming. And our politicians insist they heed voters' concerns on climate change.

But in midcampaign, the environment has faded from Canada's political horizon. The media – and the electorate – have treated the issue as too complicated, the pitch as too dull, the costs as too high.

But doing nothing has costs, too. Climate change threatens our economic future. Yet Prime Minister Stephen Harper has concocted doomsday scenarios for the Liberals' proposed Green Shift, dubbing it "crazy economics." Echoing Harper's scaremongering, NDP Leader Jack Layton warns Canadians will be hit in the pocketbook by the Liberal proposal – though not, magically, by his.

Korea seeks to break climate talks deadlock

AMSTERDAM, Netherlands - South Korea wants developing countries to put their plans for reducing carbon emissions on paper — a proposal it hopes will break the stubborn deadlock in climate change negotiations.

South Korea's chief climate negotiator, Rae-Kwon Chung, said Friday he would propose an international registry in which countries such as China and India would record their domestic carbon emission policies.

World Bank collects 6.1 bln dlrs in pledges for climate funds

WASHINGTON (AFP) - The World Bank said Friday that 10 nations had pledged more than 6.1 billion dollars to its new investment funds aimed at helping developing countries fight global warming.

The Climate Investment Funds, launched on July 1, are aimed at providing "interim, scaled-up funding to help developing countries in their efforts to mitigate increases in greenhouse gas emissions and adapt to climate change," the multilateral development lender said in a statement.

Schwarzenegger to convene global climate summit

SAN FRANCISCO - Gov. Arnold Schwarzenegger, a Republican who has challenged many members of his party to take climate change seriously, said Friday that he plans to invite lawmakers and governmental executives from around the globe to California this fall to address solutions to the problem.

Climate change, fuel prices cutting into Lebanon forests: Urban sprawl, pollution join global hike in fuel prices to threaten forests in Lebanon.

In addition to the common threats to forests such as urban sprawl and pollution, the global hike in fuel prices is taking its toll. “Lebanon has very cold winters and most of its population lives 500m [above mean sea-level]. Some live at heights between 1,800m and 2,000m.

"When you climb Mount Lebanon these days, all you hear is the sound of wood being sawed. People are preparing for the harsh winter. Although this is prohibited, many poor families cannot afford to buy diesel, so they cut down trees to secure some warm days for their children,” Fakhreddine said.

"If we end up having gasoline shortages, the odds are about 90% that Americans will do what we always do: We'll top up our tanks.

Well Simmons won't be able to blame me for doing that, I have leak in my gas tank about half way up under some strapping where I can't get at it, 20 bucks is max for me. Surprised me that there are 10 percent out there in the same situation, makes one feel not so all alone.

LOL. I don't use much gas, but seeing those people freaking out down there in the southeast makes me want to buy a gas can so I can hoard. :-)

Not so much for me, but in case I need to bring gas to a friend. (A lot of people are doing that in NC. People with small children or other obligations, who can't wait in line for hours, are getting friends to do it for them.) I have one of those cars that comes with an anti-siphon device built in, so I can't share from my tank, as some are doing.

CNN this morning showed a bunch of people who camped out with their entire families at a gas station, hoping to be first in line when the tanker truck arrived. Sadly for them, the tanker truck did not arrive. It couldn't find any gas to deliver.

The Fast And The Furious 4, stealing "petro" has never been so cool!!
A trailer:

I walked by a well dressed woman balling out the cashier for only allowing 10 gallons in her Ford Expedition(?) big SUV. Many stations have a $50 or 10 gal limit in Asheville, NC. I walked by, into the grocery store, picked up a couple things, came back out and they were still going at it, on my walk home. Now 5 people excitedly talking. This is the 3rd time this station has had gas in I believe 19 days. There are many more gas stations with gas now here, no 100 car lines cars running out in the street.

I was able to fill up both of our cars today (Saturday). Each car was about half full, we had last filled up before Ike hit. There was one station in town that had gas, and I was able to get right in with no waiting lines.

I suspect that a lot of the people that had so much trouble this last week either:

1) Paid no attention to the news and were clueless. They had no idea that a hurricane wiping out refineries in TX & LA could impact their gasoline supplies. Thus, they had little fuel in their tanks to start with. (In contrast, I did know this, I was alert to events, and I knew when Ike hit that I needed to make sure all of our tanks were full.)


2) Drove fuel-inefficient vehicles long distances to work each day, and thus needed mid-week refills -- they couldn't go more than just a few days between refills in any case. (In contrast, I walk to work and my wife drives a Honda Civic just a few miles each day to work. We could have gone at least another week or two if necessary before really needed a refill.)

Lessons to be learned:

1) Arrange your life to minimize your vulnerability to energy supply disruptions.

2) Having done (1) as best as you can, be aware of your remaining vulnerabilities, have contingency plans, and stay alert and ready to implement your contingency plans the moment it looks like a supply disruption is going to happen.

"Lady, with your 10 gallons, you get a free prize of a nice warm cup of STFU. Or you don't get any gas. Your choice."

How long before we see private service stations in
gated communities for members only ?? Think Costco on
a local level ..

Triff ..

I don't understand why they aren't praying for more gas. I mean it worked to bring prices down earlier this year didn't it?

Where's old sonny Perdue and that pray at stations around the nation guy?

It just blows my mind when I hear about the shortages in the SE because reg. unleaded here in the Midwest just dropped to $3.14...I don't comprehend the massive disconnect even knowing how the pipelines are laid out in this country.

The price of gas is irrelevant, the higher the price, the more one has to conserve.

The problem with price controls is that it results in this type of shortages, and the shortages prevent people from using alternate transportation like motorcycles as they have much smaller range between fill up's.

Even the most economical of my bikes can only do about 150 mi between fill up's while my car can do over 700 miles on a tank.

The price controls is what forces cities into stand stills. If fuel is available even at very high prices then people can use a variety of already existing vehicles, like motorcycles and mopeds, that have good fuel mileage but little range.

Even if something like the Volt were reality instead of being a grant magnet, most regular people could not afford an extra 25K or whatever, even in form of debt burden.

Put a sisy bar on your bike and use it as support for a 2-4 gallon jerry can of gas.

I recently bought a 2006 Kawasaki Ninja 250 (used -- I always buy bikes used) to supplement my 78 BMW R80. The old R80 is pretty cool, but at 31-33mpg for city driving, it really isn't a great commuter (especially when I can get that in my car!). The 250 gets 70mpg, and when I've really tried to have absolutely no fun, 77mpg. Tank is over 4 gallons so I don't even think of refilling till 250 miles -- runs perfectly on regular unleaded too. It isn't the kind of bike I'd want to go on a long trip with, but it makes an excellent commuter.

From the Oil Market Collapse Waiting To Happen above:

The price of North Sea (Brent) crude oil is now the direct benchmark for over 60% of global crude oil pricing, and, through the mechanism of massive "arbitrage" trading between Brent and WTI, it also constitutes an indirect benchmark for most of the other 40%.

Most people - including virtually all mainstream press reporters - believe that it is the price of futures contracts that is used as a benchmark. In fact, it is the reported "spot" market price of "dated" Brent/BFOE (see below) cargo transactions that constitutes the direct and indirect benchmark for most global oil transactions. The massively traded ICE Futures Europe Brent/BFOE Crude Oil contract is merely a financial bet on these underlying prices, and these financial contracts are settled in cash, not oil.

For many years, the production of the Brent oil field has been in decline, and the production of other North Sea oil fields has therefore been amalgamated with it to ensure a sufficient number of transactions to give a credible benchmark price.

We now see four fields - Brent, Forties, Oseberg and Ekofisk ("BFOE") - together supplying the BFOE "Brent" contract whereby 600,000 barrel "cargoes" of these qualities of oil may be bought and sold forward for eventual physical delivery.

My question is: does anybody have a good link for the daily quote of the "spot market price of dated Brent/BFOE"?


BFOE is basically Brent crude: Prof. Jayanth R. Varma's Financial Markets Blog

The term Brent crude today refers to crude coming out of any of four oilfields in the North Sea – Brent, Forties, Oseberg and Ekofisk – collectively referred to as BFOE.

That is the same spot price reported on the Bloomberg.com Energy Prices web site. But Verma's Market Blog explains the spot market very well, especially the BFOE market.

Ron Patterson

I think there are other issues of concern in the same article, in particular the concern that the futures market will melt down, and the US will have yet another inadequately funded guarantee. This is like the FDIC guaranteeing all the banks, without actually having much funds. Also like Fannie and Freddie, and the US Pension guarantee system.

Oil Market Collapse Waiting to Happen

In the absence of a new approach to market structure we will inevitably see repeats of the recent spike in oil prices as waves of hot money swill in and out of the market. In my opinion, that will inevitably lead, sooner rather than later, to a market meltdown - similar to the literally overnight collapse of the tin market in 1985 from $800 to $400 per tonne.

The conventional wisdom is that the "central counterparty" clearing houses of futures exchanges, which guarantee the performance of transactions, backed by a pool of capital and margin, are a strength of these markets.

In my view, they also constitute a single point of failure, where oil price risk is concentrated in exactly the same way that Fannie Mae and Freddie Mac were massively exposed to house price risk.

OPEC has vowed to stabilize the price of oil to prevent market collapse. They were jittery over the recent collapse from $147 dollars a barrel. Russia has been in negotiations with OPEC as they are also worried about a collapse and would like to see higher oil prices. Ecuador recently affirmed OPEC's desire for market solidarity rather than collapse.

The average U.S. citizen uses about 2.8 gallons of oil per day. If the world's population of 6 billion were to achieve the U.S. level of consumption, the world would need about 400 million barrels of oil per day. Currently there are about 87 million barrels per day of total liquids production. The world strives for affluence instead of poverty.

Part of the price of oil in the U.S. is due to inflation. Five years ago the dollar was worth about 30% more compared to the euro. Thirty percent currency inflation after years of deficit spending. Current plans might lead to another trillion dollars of deficit. That is likely to weaken the dollar and cause a spike in prices including food and oil not associated with consumer habits or changes in oil supply.

One current forecast is for year end corn stocks to be 2/3 of last year's levels. That is likely to cause a crisis in the grain export market. There was combined pressure from the ethanol industry and weather events to cause this potentially catastrophic situation.

Bad leadership produced bad results.

Yesterday my wife and I made an effort to drive across town to a special screening of FLOW:For Love Of Water, a darkly prophetic film about the sleeping giant of threats:Peak Water.

The film begins with a bleak W.H. Auden quote:

"Thousands have lived without love, not one without water".

The overriding theme of the movie is the politics of water and the threat to our future, for both rich and poor nations, unless the emergence of a dominating world water cartel, intent on the privatization of water, is thwarted. Sounds like a plot to a Star Wars movie doesn’t it?

"We have wars going on over oil; water can be oil all over again", declares an activist in one of the countries “rescued” by the IMF. The director, Irena Salina makes a thorough examination of the struggle between multinational corporations, in cooperation with the IMF, privatizing water sources in developing nations and the majority of the people who cannot afford even nominal fees for water. It shows disquieting images of poor people in Bolivia being clubbed in the street as for protesting the prices demanded for water by multinational companies like Coca-Cola, Bechtel and Nestle.

Then on a local note that will have most of us re-considering the safety of our domestic supply of water, Salina points out that there are more than 116,000 manmade chemicals floating around our allegedly clean H2O supply, with one scientist even pointing to the recent discovery of Prozac in Texas tap water. That explains a lot.

As any good documentary worth its mettle there are the usual suspects at the Bush Administration. Here’s a newsflash: Atrazine, an endocrine disruptor so toxic it causes prostate cancer in humans and turns boy frogs into girl frogs; the EPA’s okay with us spraying 76 million pounds of this junk all over the countryside every year. The usage of Atrazine is banned in the European Union, which is ironic since that’s where we buy it from. (Q: Why does the Bush administration seem like the bad guys in a WWII movie?)

The movie raises some uneasy questions about the commodification of natural resources. There is a creepy scene with our billionaire hero Boone Pickens buying up water rights in the parched Southwest, smiling sardonically about quaint notions that air and water should be free. The only thing missing was Milton Friedman smiling proudly at his legacy.

For me this movie was personal. I grew up in Las Vegas NV and have lived most of my life in the Southwestern U.S. I have daily witnessed the mindless depletion of aquifers and rivers for the sake of Swimming Pools, Golf Courses and decorative lawns. As a result Las Vegas will be dry in 7 years. California will be dry in less than 20. What’s being done? Nothing much. Peak Oil may not be our biggest worry after all…

I think they're related. If energy weren't a problem, water would be much less of one.

The arid Middle East is solving the problem via desalination plants. Natural-gas powered desalination plants. They have big plans to build more as demand rises with the population (and the wealth of the population). It's not cheap water, but it's worth it...as long as they can find the fuel. We have similar plans in places like California.

And as The Economist noted not long ago, the so-called food shortage is actually a water shortage. The amount of water that biofuels consume is a real worry.

Leanan - Do you have any idea how filthy desalinization is? Look at the coastal waters from satellite images along the Arabian peninsula - they're black. What do you do with the brine?

A: Dump it in the Ocean.

It seems obvious to me that the core of the problem is the overwhelming size and scale of these mega-projects financed by wealthy countries and multi-nationals. Consider the scale of the Three Gorges Dam in China. It's monstrous! In our country we have damed up every river river and stream until they are about dead.

Oil is not the life-blood of the earth. But water is.

Sorry Joe, but this is absolute nonsense. Desalination does not turn the water black. I have worked near desal plants in Saudi Arabia and the brine that is dumped back into the sea is the exact same color as the water taken in, just a little saltier. I actually worked at one desal plant at the Gazlan power plant. It was an evaporation plant, just like the huge one just one mile north of Gazlan. There was never a problem with water pollution at either. And you will not see any black water from google earth in this area, which I believe is the world's largest desal plant.

All desalination does is remove the salt from the water then the residue is simply dumped back into the sea. That water is about twice as salty as the water pulled out but it quickly mixes and is diluted with seawater.

I have no idea what the "black" stuff is you are talking about but I can absolutely guarantee that it is not the brine from desalination plants. The main problem with desalination plants is air pollution from the fossil fuel burnt and some slight thermal pollution in the immediate vicinity of the brine discharge areas. This thermal pollution can sometimes cause algae blooms but there was no algae problem in this area of the Persian Gulf when I was there in the early eighties.

The vast majority of desalination plants, especially the very large ones, are evaporation plants, powered by fossil fuel. Most smaller or local plants are of the reverse osmosis type. These are powered by electricity and have no thermal pollution whatsoever.

Edit: Desalinated water is far, far, too expensive to use for irrigation, even in Saudi Arabia. Saudi did use fossil water for irrigation of wheat but they are now phasing out this program.

Ron Patterson

I have no idea what the "black" stuff is you are talking about but I can absolutely guarantee that it is not the brine from desalination plants.

In the United States, due to a recent court ruling under the Clean Water Act, these intakes are no longer viable without reducing mortality by ninety percent of the life in the ocean; the plankton, fish eggs and fish larvae...

Regardless of the method used, there is always a highly concentrated waste product consisting of everything that was removed from the created fresh water. This is sometimes referred to as brine, which is also a common term for the byproduct of recycled water schemes that is often disposed of in the ocean. These concentrates are classified by the United States Environmental Protection Agency as industrial wastes.


Carlsbad CA is currently constructing one of the largest desalination plants in the world and during the hearings environmentalists showed slides of the "black water" along the coasts of the Saudi Peninsula that have grown as a result of desalination. "These are dead zones." There was little surprise that these warnings went unheeded, the plant was overwhelmingly approved. I have watched the same pattern over and over again throughout the southwest U.S. when it comes to water: Stupidity.

The citizens of So CA will soon be chagrined to discover that our water supplies via the CA Aqueduct system are about to be slashed to the bone. Bye Bye cheap water.

Have you read Cadillac Desert - The American West and Its Disappearing Waterby Marc Reisner?


Joe, if you go to Google Earth you will find that very shallow water always appears black. I have no idea why this is but you cannot see dead zones from Google Earth. I have never defended desalination and have always maintained that it is extremely expensive and uses great amounts of fossil fuel.

The brine discharged from desal plants is just that, very salty water and nothing more. You cannot see any difference in the water because it is the exact same color as regular sea water. It is hotter and saltier and this enhances algae growth and causes other distress to marine life in the immediate area of the discharge. But if you had a glass of regular sea water and a glass (or a swimming pool full) of brine from a desal plant, you could not tell the difference just by looking at it. To say that it turns the water black it totally absurd!

The problem Joe, is population, desalination is just a symptom. Saudi Arabia could not possibly support 28 million people without desalinated water. The cities and their industry could not possibly exist on the little fresh water they have. The same for the UAE, Kuwait and just about every other place in the Middle East. And that is just another reason I am a doomer. These places will be screwed when the fossil fuels for the desal plants are gone. There will be no food and no water and all those "organic food people" are just whistling dixie. When the oil is gone these people will die. End of story.

Ron Patterson

This of course means that net exports will literally be a life-or-death issue for these countries. It will not simply be about tweaking their economies - trading off cash income from exports against consuming fuel domestically. They will need to sell a bit of oil at a high price to pay for food imports (much easier to import food than the water to grow food), or more likely use cash reserves and/or the income derived therefrom, but fuel for desalination will be non-negotiable. Once production has fallen enough, any foreign power trying to exert influence on them to increase exports by decreasing domestic demand will rightly be seen as committing an act of war.

Excellent point.

And it will not just be fuel for desalination but the energy to move those water resources around and the energy to run the A/C and all the other creature comforts to which people have become accustomed.

Social revolutions almost never occur because the "have nots" seek to overthrow the existing social order. Social revolutions occur when the "haves" suddenly find themselves at risk of loosing their favored status and move to assert control of the state and the distributive mechanisms.

In addition to the potential for external threat there is an equal or greater internal threat which may lead to social upheaval and destabilization.

I think if you were a sensible arab person you wouldn't export a single barrel more than you have to right now, in order to balance your trade for as long as possible. IMO, and experience, in 50C heat it's better to have water than worthless IOUs.

The problem is population

Ron - you and I are in complete agreement on that issue. I am currently enrolled in a local ecology science class. Last week we arrived at Human Population Trends. The professor was clever about presenting it because rather than preaching doom he had the students analyze and graph population trends from such sites as: http://www.census.gov/ http://www.census.gov/ipc/www/idb/worldpopinfo.html

We compared world population growth trends in MDC's (most developed countries) to LDC's (less developed countries)and had us extrapolate those trends.

When we extrapolated current world population (6.87 billion)taking a growth factor of 1.2% the world population reached almost 10 billion by 2050. the consensus is not that that population would be impossible but what kind of "hellish world" we'd have to live in. For me I will never live to see that time but those young people will and they intend to do something about it.

Yesterday the students (mostly young people) got into a spontaneous discussion about curbing population voluntarily: They went from subjects as diverse as family planning to forced sterilization. There wasn't anyone suggesting over-turning Roe vs. Wade. Abortion on demand was more to their liking. As a matter of fact these young(reproductive)adults were slamming Sarah Palin for being a "serially pregnant bimbo".

I think there is a paradigm shift coming.


Hmmm...if forced sterilization and abortion are points they quickly promoted, I suspect the steps they'll take will be the same ones I foresee. That is, in the end, what makes the outcome hellish, and it is likely unavoidable.

That is, in the end, what makes the outcome hellish

Paleocon - What the f*#k are you talking about?

I thought it was obvious. Apparently not, but that's no reason to get testy.

If the best solutions they can come up with is controlling the weak through forced sterilization and eliminating the weakest through abortion, it is only to be expected that additional solutions will be similar or worse.

A world of starving people is bad, a world of resource wars is worse, but a world full of sub-groups where life and death are determined by the young and powerful is worst of all.

But that is indeed reasonable to expect. People will almost certainly die en masse, and by various means. The societal determination of how that happens will be a measure of humanity, and I suspect we will be found lacking.

Paleocon - 20 years ago my wife (ex) and I made the decision to have an abortion. We already had two children but we believed that it was personally irresponsible having more. I also had a vasectomy.

We also talked to our children (10 and 14) about it and the younger one was very angry. But we had long ago decided to talk to our children as young adults. I did however put it to him in terms that he might understand.

"... remember when we went to Disneyland and you started complaining about the crowds. Well that's because there are too many people."

I think he got it. The world is clearly in overshoot and education and equitable resource distribution is a positive answer to over-population. Putting your head in the sand and waiting for Malthusian solutions to over-population is not only cruel but it is dumb. Population reduction is not about crushing the weak but the contrary - empowerment.


I did similarly as you, but had the vasectomy one pregnancy earlier, when we were "done". Certainly an unmet worldwide need is cheap and effective birth control, and that is one reason that I don't condemn those who choose to have an abortion individually though I don't support it personally and believe it is rarely the "only option". I do also have adopted children, so I put my money and my personal behavior where my mouth is.

Note that with Disneyland you can always choose to not attend ("nobody goes there anymore, it's too crowded" - Yogi), while choosing to shoot others in line to reduce the crush would generally be frowned upon, however tempting it might be. Let's not even consider shooting your own kids to help eliminate the line at "It's a Small World", though after about 10 minutes of the song that might seem reasonable, too.

Education and resource-management options are good things, and making them more available to all is of course positive as well. Presuming to make life decisions for others gets into very unstable moral grounds. Who decides who gets sterilized by force? Is that morally better or worse than paying cash to convince them to do so voluntarily? How does that stand up versus various contraceptives, including abortion?

Where does euthanasia come into play? Is it better to deny healthcare (or affordable care) to the elderly and "let nature take its course" or put them down a la Logan's Run? Is that better or worse than letting a younger generation eliminate each other with bullets on a battlefied, or doing for all en masse with nukes?

The only moral high-ground I see is to individually decide to lead a more constrained life and strive to educate all while endeavoring to make a pre-Malthusian plateau as long as we can so that individual behaviors can change and adapt, and then working to ease suffering as it occurs.

Population reduction by force, however the means, is the ultimate in elitism. We do that here for deer control, and it is certainly effective and limits suffering and death by disease and starvation, but I'm not really sure any individual deer "selected" for execution prefers a quick bullet to scavenging for food next winter, and I'm pretty sure they'd shoot back if only they had opposable digits and a reliable arms supplier. I keep expecting PETA to come up with a plan to feed contraceptives to deer to reduce the population and cut tag-limits, but that hasn't happened yet either.

I'm not putting my head in the sand, as I said I'm expecting such a future. I am also pretty sure that if somebody came to take my teenage daughter for a forced tube-tie I would choose to eliminate their existing contribution to overpopulation before they would eliminate the potential of hers.

"Hell is other people" Jean-Paul Sartre

''hell is other peoples bathwater''

- younger brother of Jean-Paul Satre

"What a little prick!" - Neighbor dissing younger brother of Jean-Paul Satre.

"paradigm shift?" I doubt it, You can't fool Mother Nature.

World population trend shows a dramatic drop in population growth trends worldwide. 50 years ago world population trend was: 2.6% Today: 1.2%

Numbers don't lie.

Joe, it is great that the growth rate is down but we are still adding about 70 million people per year to the planet. We are already deep into overshoot. We are way over what the earth could support even if we never run out of fossil fuel. But we from four to five billion people what the world can support without fossil fuel.

Declining rate of the population increase? Like it matters!

Ron Patterson

Like it matters!

All of the MDC's populations are in decline (some such as Japan sharp decline). Even parts of the LDC's where education is available for women the populations are in decline as well. Poverty, scarcity, ignorance and religious dogma employ pregnancy to keep women subservient.

When women are given choice there is historical evidence of population reduction (even in India). This current Bush administration and Christian Zombies have done more to turn back efforts at population reduction (wait the invasion of Iraq is responsible for the deaths of at least 100,000 so they did offset a little population overshoot)than any other force I can recall.

Next year I have volunteered for a Peace Corp mission to help promote education in LDC's. So I guess that's a waste of time also?


Just curious Joe, how many people do you think the world could continually support even with fossil fuel? And without fossil fuel for that surely shall run out?

India's population is growing at 1.58%. They have 1.15 billion people and are growing by over 18 million people per year. Every form of population control has been tried in India, all have failed. What has slowed their population growth down to its current level is the principles of Malthus. They are desperately overcrowded and many are very hungry. Their water tables are dropping, in many areas, by over two meters per year. They can no longer produce enough food to feed themselves.

What is slowing their population down is the very same thing that is causing population growth to slow in many other parts of Asia and Africa.

You should be proud of your work in the peace corps and no it is not a waste of time. The people you help will have a better chance of being among the survivors...at the expense of others of course.

Ron Patterson

Ron - Thanks for that. I have done a lot of things in my life and very little has made a shit load of difference. I need to feel that what years I have left I might make a difference.

As far as figuring out what this planet might support with or without fossil fuels we could spend several hours computing the solar constant of this planet (10.9 billion calories x Meter squared per year divided by .002%) and determine what level of humanity that the finite energy supplies of this small planet might support. But the sad part of that task is when you have to factor in human greed (over-consumption).

I have only recently reached the awareness of the degree that my own personal over-consumption has contributed to this horror-show. As a result I have a hard time being critical of other people who are doing exactly what I did for half a century.

Years ago I watched a program about the felling of the old growth forests in the Pacific Northwest. At the end there was an epilogue by an old lumberjack looking at the moonscape he had helped create while he was earning a living and raising a family. He was tearing up as he said "We never thought it would end!"

I'm an out-doorsman. I always have been. I now grieve for what we've traded for "all of this shit".


Just curious Joe, how many people do you think the world could continually support even with fossil fuel? And without fossil fuel for that surely shall run out?

I'll add my 2 cents even though you are addressing Joe

What is below IS feasible; however I really dislike this 'plan' and see the likelyhood of it happening to be zero for a multitude of reasons.

Earth could support a population of 40 billion humans for thousands of years with this 'plan'

1. Kill ALL land animals larger than a rabbit. How many cows are there worldwide? A cow will conservatively eat more than 6 humans; probably more than 10 humans...so just eliminating cows and having ALL humans become vegitarian would likely be sufficient.
2. Spend $1.5 Trillion yearly on renewable energy for the next 30 years. IMO 15 years might be sufficient with that level of financing. AND do include massive buildup of generation 4 of nuclear reactors in addition to renewables.
3. Water supplies worldwide would be increased massively in this plan with desalination powered by renewables
4. To repeat myself; 95% to 100% human vegitarianism OR veganism would increase food supplies worldwide by at least a factor of 5 in maby 15 years...that is a population of 30 billion humans.

Personal note; I am a doomer...I do not see a rational and feasible plan happening before a worldwide human dieoff. It is IMO oppinion technically feasible to support a population of 40 billion humans indefinately. Also with the renewable buildup I describe fossil fuels would not be needed.

Darwinian, you are a doomer like me...BUT can you dispute my 'plan' as being technically possible IF humans magically thought with the logic of Vulcans?
Of course Vulcans wouldn't WANT a population that high and voluntary population stabilization at maby 4 billion would be eminately logical to Vulcans;)

What about phosphorous and potassium fertilizer? When production peaks and declines, maintaining the required food production levels would become impossible, I would think.

Sorry I don't know much about that.
I sugest you ask totenela(sp?)

But since you asked me...WAGS below

First, my 'plan' was technically feasible...it was however politically impossible given human nature.
To rephrase; it is possible in principle to do my 'plan' however most people includeing myself would object to manditory vegenism and manditory population control and manditory kulling of ALL nonhuman mammals on land. Really my theoretical 'plan' offends ME! It was pure theory, pure 'what if'

IMO there would not be a fertilizer shortage IF phosphorous and potassium fertilizer was proceessed and reused as advised by Toteneila. Toteneila's advice is more expensive NOW, but it will be a requirement eventually.
IF there were a shortage? Dredge river beds worldwide. Dredging would be very bad environmentally and I'm sure there are better options.
Reprocess ALL landfills worldwide for ALL valuable elements that are recoverable...this is a good idea that I like. I am a fan of John Micheal Greer and he might have advocated this.
Use notill farming to reduce runoff of nonrenewable fertilizer componants.

I got voted down?
I have never voted up or down on anyone; to me the up/down rating is fluff.

Hello Drizzt,

I am not aware of any river dredging specifically for P & K, do you have any links?

Water soluble chemicals tend to stay in suspension till they reach the ocean or a lake with no escape. River plants and animals tend to concentrate heavy metals in their tissues as a bio-chemical function, but when they die: again the soluble chemicals head downstream. Thus:

Australian junior prepares to mine phosphates off Namibia's ocean floor

...The deposits are accessible with current marine mining and dredging technologies that are being used in water depths of up to 600 m, he adds.

A basic screening out of anything larger than a millimetre yields a phosphate enrichment of up to 24% and further removal of shell components yields enrichment of up to 35%.

“That’s a pretty simple process; there is nothing complicated about the deposit and it sits in the sea bed in an unconsolidated sediment,” Woodborne says.
I am no marine dredging expert, but it sounds like a subsea environmental disaster in the making to me.

Potassium metal is never found free, as it reacts violently with the abundant water in nature.[1] Potassium compounds generally have excellent water solubility, due to the high hydration energy of the K+ ion. Potassium salts such as carnallite, langbeinite, polyhalite, and sylvite form extensive deposits in ancient lake and seabeds...

Due to its reactivity with air and many other oxygen-containing substances, phosphorus is not found free in nature but it is widely distributed in many different minerals.

Sadly, dredging rivers nowadays is usually a biohazard, not a fertilizer source:

Army Corps may change plans to dredge Saginaw River to avoid tussle with DEQ

The state DEQ has said the dredging spoils site must include a slurry wall and groundwater permit to ensure the pit doesn't leak contaminants back into the river, including toxic dioxins from Dow.

The spoils site is already the safest one the Corps has ever designed, agency officials say, and 14 monitoring wells are planned to make sure water doesn't migrate off site.

Links? No
Keep in mind it was WAGS from me...that is why I mentioned you for fertilizer.
You claim to not be an expert; however compared to me and probably most here you are the TODs fertilizer expert.

I will add that PLEASE create your own blog AND link to your fertilizer blog when you post here...a few days ago about six TOD posters asked you to create a blog including Leanan, but you did not reply. Blogs are free. If a blog is a bit intimidating to you just ask Super G or others who deal with web issues; you will get more than enough advice from TOD posters.
As you say; no specialization without food.

Of the options I meantioned IMO river dredging is a BAD one. Processing landfills would have a multitude of benefits, but dunno about potasium and phosphorus concentrations in landfills.

The sea dredging you meantioned to me seemed to be much better. You thought it would be bad environmentally; my WAG is that the deposit is probably less than 300 sq miles of ocean floor. Compare the VALUE of that ocean dredging project for that phosphates project VS. the disaster that is commercial dragnet fishing. Everything I hear about dragnets is VERY bad. 24%? Wow! that is an awsome stat;)

Unfortunately we still have overall an exponential world population growth that is permitted by the use of fossil fuels, a relatively stable climate and the one-time-use of things like fossil water, topsoil and phosphates.

Exponential growth is always unsustainable and, based on other species behaviour in the presence of an abundance of food, it's likely that what we see at the moment is the first half of a more or less symmetrical peak.

The population is currently doubling every ~40 years, close to a billion a decade. A slowing of the growth rate is what we expect as we approach the peak, and what we currently see.

Hopefully, I won't be around to see the second half exponential decline from the peak!

The population is not growing exponentially, the rate of growth is slowing rapidly, and projections were that it would not double but rise from around 6.5 billion to around 9.5 billion towards the end of the century than start falling.
Of course peak oil and other strains may mean that this population is not sustainable, and in any case economic turmoil may change the population projections either on the upside or the downside, but the projections are lower than stated.

Yes, it is. Sure, the world was once growing at 2.0%+ per year and now it's 1.1% or 1.2%. I realize the trend is down, too. But is something like 0.5% per year growth too much? (I think it is.)

I'd agree it is likely too much, but it is important to get the basic facts straight - I would expect the birth rate to fall further in the developed world with recession, as happened in the 30's, but unfortunately it seems likelier that rural areas in the third world will go up, not down, as has happened in warfare situations in places such as Angola and Afghanistan.

Hello Xeroid,

Speaking of forty years--> a teaser segment below:
..Grant estimates that in the next 40 years we will need to produce as much food as we did on this planet in the last 10,000 years.
MIND-BOGGLING! IMO, this is NOT going to happen.

Link below to display just my very last posting in yesterday's DB, with more weblinks and other info, in case you missed it:


Darwinian -

I agree that the high salinity of the brine disharged from desalination plants should not pose an environmental problem provided that there is sufficient dilution with fresh seawater. This can be done relatively easily with an arrangement of diffuser pipes. Ditto for thermal pollution.

It would seem that solar power (particularly via concentration collectors) and desalination are made for each other, particulary in a hot, sunny place like Saudi Arabia and most of the other parts of the Middle East. As you are making a product (desalinated water) that can be easily stored, you don't have to worry about the natural diurnal cycle of solar power. And if you must run the desalination plant 24/7, then there is always the possibily of storing enough of the heat from the daylight hours to carry you through till the next morning and then some.

I'm sure the main reason solar-powered desalination has never caught on for large-scale applications is the economic conflict between high-capital/low-operating cost systems vs low-capital/high-operating cost systems. The desire to minimize capital usually results in the latter winning out. However, given the way things are going, that could all change sooner than later.

There are also possibilities for using nuclear power to both generate electricity and desalinate water. Desalination could be a good way to utilize the enormous amount of waste heat generated by a nuclear power plant. Again, capital cost is the potential deal killer.

Part of the issue is that there is lots of oil there (so no urgency) and part is that solar energy, especially with desalination as a cogen function is something that still requires a lot of R&D and in enough quantity R&D winds up being spelled J.e.w.s. and H.i.n.d.u.s

But several Arab princedoms are waking up to all these issues and attacking them from all sides - facing the dwindling of oil supplies, setting up an academia of their own, and liberalizing a little.

Hi All,

Just a question here - or maybe a statement. I am being told that to this date the dumping of residue having double concentrations of solutes into an area is doing no harm. Perhaps it isn't at this time with this number of desalination plants - but at what point will it begin to have an impact? I don't think you can say never - because I think the first few thousands of autos had little impact on their environment....but now?

And I have to say that it is my strong opinion that change is occuring because of this dumping. What kind of change I don't know. I suspect however, that if someone looked - change would be seen.

It would be nice to quantify this and have some idea what effect scaling up desalination would have - other than economically I mean.




I think if you calculated the total volume of desalinated water in relation to the volume of the oceans it would be like you peeing in lake superior.


And I am certain that 75 years ago all those nasty fumes just blew away into the wind - which of course became the problem as the scale increased.

Or to take if even farther back - when the first folks settled in London (Londinium? I can't recall if it was named pre Roman times) the smoke from the woodfires just blew away - who could foresee the smog which has existed from about 1600 onward?

However, now that we have the benefit of this knowledge, I think it behooves us to consider what adverse possibilities may accrue when we scale up any endeavour in order to meet the needs of our huge population, even (or especially) if we are seeing negligible effects from industrial sized installations at this time. Never underestimate the extent to which we can ramp up production when profit is at stake - lol

Thank you for responding, and pardon my dark perspective. I have been reading "A New Green History of the World - Clive Ponting" and now I have a great need to go hug a tree - or something.


On a global scale, all desalinated water returns to the sea via rivers or aquifers or evaporation and rain, so there is no net result on the saltiness of the sea.

On a local scale the picture is a bit different.

We have a salt water swimming pool. I have often put a 50-lb bag of salt on the top step and watched a sheet flow of brine down the steps and along the bottom of the pool to the deep end, where it accumulates and gradually diffuses. Brine is dense, and mixes reluctantly.

I would predict something similar from a desalination plant outfall -- a dead area of sea floor from the outlet pipe to either a natural depression or gradually petering out as the brine mixes with seawater.

Of course the brine is warmer so it tends to rise, complicating the picture.

The full picture would depend on density, miscibility, diffusion rates, tides and currents, and local topography. A nice modeling exercise.

But the amounts of brine are so small compared to the sea volume that one cannot expect wide-spread problems unless the outfall is in a very sheltered area.

If energy weren't a problem, water would be much less of one.

Energy caused the problem.

In the same way that cheap credit resulted in a US housing bubble that now threatens the US economy, cheap energy created a latent crisis which has yet to be fully acknowledged.

People did not begin to populate the desert regions of the US until they had cheap energy. This allowed the use of A/C to make the climate habitable, permitted the collection and transport of water resources, and underpinned the cheap transport that allowed folks from everywhere to fly in to Las Vegas for a crappy weekend.

The outcome was an economic boom that attracted more people to the point so that even with cheap energy the region was bumping up against environmental limits. Even with cheap energy the area was experiencing localized overshoot. Take away the cheap energy subsidy and the US southwest is in for a world of hurt. Just wait for the screaming to begin, and the demands for a government bailout.

Why did this happen? Well, Americans are exceptional people. They acknowledge no limits, their way of life is non-negotiable and it is their forsworn duty to consume everything, entertain themselves 24x7, and then call on the government for a bailout when the extent of their self indulgent errors become apparent.

Unfortunately for the rest of us, when Americans are confronted by an unpleasant domestic reality they look for a foreign scapegoat to blame.

Americans are exceptional people.

You said it all brother.


Rainwater, Simmons, Puplava & Kunstler

Interesting that all four of these gentlemen either now own, or they are looking for, agricultural land.

Rainwater? I think he is the guy who has has a lock on virtual agi land, isn't he?

Wrong person--google Richard Rainwater + The Rainwater Prophecy

Oh dear, didn't I just find a real nonentity, or what? Thanks Totoneilia you're a brick.

Buying the land is easy. Working it is much harder. And capital intensive -- tractors, discs, tillers, cultivators, planters, etc. Of course, I'm sure for all those guys money is not a problem, but time and experience are.

After purchasing 13 acres last September, my husband and purchased equipment and grew half of it out with a variety of organic vegetables. Instead of selling the produce, we donated it to homeless shelters and food banks because the harvesting, washing, chilling and distributing is large project in itself. And since we were/are new to "farming" at this scale, we knew we needed a year or two to experiment.

We purchased a small 35HP John Deere tractor on EBAY sight unseen as well as a variety of other equipment. Just hooking up the PTO tiller to the tractor for the first time was nervewracking. But even with just one season under our belts, we learned so much and are much more comfortable and confident. Next year will definitely be easier. But I can see that it really takes years and probably a lifetime to get good at it.

We figure down the road, the distribution side will be easy due to the ramifications of Peak Oil. But even on a few acres, lots and lots of vegetables can be produced. We literally had truckloads. One just one day I picked 8 40-gallon containers of green peppers. And my root cellar is filled with potatoes, onions, shallots, garlic, dried beans and winter squash as well as a freezer full of veggies (no time to can this year! I'm no Sharon after all).

sandiego - I'm fascinated by what you wrote. What an experience. Are you located in San Diego?

LOL, I am Sharon and I'm no Sharon ;-) - that is, part of the reason I preserve so much is that I don't grow as much as you do - plus I have a shorter growing season - we never did more than an acre and a half of veggies - and never had a tractor. It always sounds better when I write it than it actually is ;-).

Congratulations on both the land and accomplishments.

Sharon Astyk

Sharon - Great piece of big picture thinking on that Pealing the Onion piece.

Thank you for the good work you do.

Here is the math Matt Simmons used in his presentation in Sacramento if we should experience The Great Tank Topoff:

  • America has 220 million passenger vehicles.
  • Assume average vehicle can hold 20 gallons.
  • Assume average current tank has 5 gallons.
  • Topping off ≈15 gallons x 220 million = stock draw of 78 million barrels
  • Current finished stocks (excl. blending supply) ≈87 million.

Thus, a run on the gas bank would exhaust supplies very quickly.

He then pointed out that since we no longer have gas station attendants, precisely how will we accomplish rationing when it becomes necessary? We'll need ration booklets so that we can hand a coupon to the person behind the cash register. But, he points out, the booklets have not been printed.

In other words, we are not even in a position to execute a rationing plan.

Did he give any reason for his assumptions? They don't seem reasonable to me.

20 gallons for an average tank size seems high. My car has a 13 gallon tank, and I don't think I've ever pumped 10 gallons into it. The fuel light goes on long before then, prompting me to fill up. Sure, there are Hummers with huge tanks, but I doubt they balance off the many cheap, small cars on the road. The estimates I've seen for average tank size are all under 20 gallons.

Also, why assume only 5 gallons on average, if the average tank size is a 20 gallon tank? Isn't 10 gallons more logical? Maybe more, since there will likely be more people on F than on E. Most people fill up well before the tank is actually empty.

New, efficient cars have 10gal tanks. Trucks have 20 or larger. Mid-90's Suburbans had 40 (mine did). My Jeep has 23.

MANY people are JIT gassers -- they put in $5 to get where they need to go, and bounce between 1/2 and empty.

I imagine the average will be in between -- but still pretty bad -- especially since for every 20-gallon tank half-full there is somebody like me with an already-full 10gal tank but a couple of empty gas cans. People who plan ahead will strive to get extra gas; those who don't plan ahead will rush to get any gas.

I suppose it could be like the Hunt Silver Market, where silver came out of houses. Maybe as we run short people drain their lawnmower cans and beater trucks to fuel their Camry's? Certainly people will work hard to drive their best-mileage vehicles and park the worst?

Maybe as we run short people drain their lawnmower cans and beater trucks to fuel their Camry's?

People are already doing that in the southeast. They're draining the tanks of their lawnmowers, ATVs, etc., to fill their cars.

Almost all of the minivans, pickups, and SUVs you see have at least a 20 gallon tank. Suburbans come with 31 or 39 gallon tanks in 2009, depending on other options.

Large pickup trucks (F250, F350) can have extra large tanks, since they are used for work such as pulling trailers. Here in the middle of ranch/farmland, many people drive these things as their daily vehicles, since they own cattle (or the like) and move them in the evenings after work, or have to pick up 1,000 pounds of feed, or whatever. I have no idea about all the FedX type delivery trucks and working vans used by electricians and plumbers.

All I'm saying it it's easy to see a lot of fuel capacity out there on the road.

I used to frequently wait until I'm on fumes (putting over 10 gallons in my car which officially has a 10 gallon tank) to fillup. I don't do that anymore.

I dont understand this.

I fill up when I get to half full.

I insist my wife does the same.

I cannot understand the rationality of not hoarding.

I have to agree. What you put into your vehicle's tank can't be regarded as hording, since you will be using it up in a few days anyway. Why would it be better left in the station? So that you can wait in line to buy it later?

Keeping your tank full is just common sense. I never understood people who let their tanks get low.

The problem isn't the few people who keep their tanks full. The problem is the many people who drive so many miles in such inefficient vehicles that they can't go more than a few days between refills. Inventories were thin already, so it doesn't take much of a supply disruption to cause these people to start lining up and getting pretty desperate.

This is the truth, but it is not what people are being told.

I never understood people who let their tanks get low.


It takes time to stop and fill-up. If I fill up at half a tank, I'm stopping at the gas station twice as often as if I wait until empty. I avoid stations that don't have pay at the pump for the same reason.

So long as there was little or no risk, this is the way I operated. Now that there is more risk due to peak oil, I'll invest the time to keep the tank half full. That's common sense, but those addicted to MSM probably do not perceive the increased risk.

I'm not saying I'm right, I'm merely pointing out a supposedly rational reason to help understand why someone wouldn't keep their tank above half full.

We (the global TOD we, certainly not me personally!) seem to very good at offering projections for many things, and providing in-depth analysis of many aspects of oil.

What I have yet to see is any real analysis of what MOL for gasoline, diesel, and other distillates really is. The per-region production and consumption charts are readily available, but do we actually know at what point spot-shortages begin, and when those turn into regional acute shortages and pump-run scenarios?

  • http://tonto.eia.doe.gov/oog/info/twip/twip_gasoline.html
  • (from a post by Ericy yesterday)

    Obviously the MOL for the SE is a little higher than where we're at now: 44.8 for the East, and 54.7 for the Gulf Coast, as we have shortages already. What about the other regions? They are all at the low edges of multi-year bands, but how close is this really to a nationwide shortage?

    Stocks (at least as the last report earlier this week) are still declining. Are we at the cusp of full regional shortages?

    Has a pump-run already happened in the SE, or has that yet to occur? If not, why not? Have we reached the point that apathy and inattentiveness will moderate the pump-run phenomena?

    If you let prices float, point-shortages are addressable for even a large outage by trucking in more fuel and discouraging people from "topping up".

    In the SE, they've been in pump-run mode on and off since Gustav. The media & politicians (including District Attorneys) have been threatening owners who raise prices significantly "When the hurricanes didn't even hit Georgia." Prosecution under price-gouging statutes has been mentioned, hotline numbers have been sent out, and the witch-hunt is on. As a result, there have been widespread shortages in some areas - including one driver who passed 17 shuttered gas stations before running out and calling AAA for two gallons while stranded on the highway.

    If the price had floated to $6 or $8 or $10, you'd have tanker trucks lining up from Mexico to New York to head down there and sell some of their stocks, you'd have people taking drastic measures to conserve, but you'd still have gas available in at least one station in town.

    my car is basically full, i rarely use it now that i have my motorbike.. though i might need to invest in some after market anti gas theft device.. though they can always drill a hole in the tank. guess i will just top off my bike on the way home from a few errands later today.

    We have reports of gas theft here (and have for six months or more, it's not related to North Carolina and Atlanta gas lines). A co-worker had her tank drained in broad daylight.

    If you at least have a locking gas cap, then the potential thief will either have to work harder for your gas, or will move on to someone who makes it easier.

    If you have a locking gas cap then the thief will whip out an awl or screwdriver, puch a hole in the bottom of your gas tank, and drain out the gas that way instead. Great strategy - now you not only are out a tank of gas, you are also out one gas tank as well.

    Yeah, but I figure an SUV would be a much better target. A high vehicle is easier to get under to punch a hole in the tank, plus is likely to have more gas in it.

    Walk up from behind and throw a match at them. Two birds with one stone, the thief and the SUV.

    When the insurance asks what happened, tell them "no idea, someone was lighting a cigar while walking by and the thing just blew up"

    Maybe you're right. I'm going to leave the door unlocked (and on my house, too), since that way nobody will break a window.

    Most fuel stations that I have seen use smart pumps. Rationing could be incorporated into the software controlling the pumps. Although the concept is more easily stated than it is implemented, it is essentially a software patch. A mandate for implementation can easily be accomplished by passing yet another law.

    Taken to an extreme, the identity and household address could could be obtained by mandating use of credit cards for fuel purchases. Enforcement could be done at the sales point or as part of the credit authorization process. This would enable rationing on a household basis. Given that the USA seems to be heading for is already engaged in ubiquitous law enforcement access to digital information and an interventionist policy for financial transactions, such an approach to rationing now seems to lie in the realm of the possible.

    An alternative is to follow the avowed Free Market Philosophy of the current administration and let the price rise until people engage in self rationing due to economics. Only laws and regulations prevent such a situation from coming about.

    Is it hoarding if one keeps on hand a year's worth of consumption? I do it for propane (really large tank, typically filled in August when the price is lowest). I'm contemplating doing the same for diesel fuel -- market fluctuations are playing hock with budgeting...

    Yes, I think rationing would actually be easier now than it was back in the '70s. Most gas stations have card readers at the pump. They could issue gas ration cards like the food stamp cards they already issue.

    And after the Real ID act passes, they could tie it to your driver's license.

    The rationing imposed by stations in southeast seemed to work pretty well. You can probably trust other customers to enforce it. With a tire iron if necessary. ;-)

    And people actually seemed to welcome rationing.

    The trouble with rationing is that it doesn't readily account for differing personal situations -- number of people in a household, vehicles and types, job commutes, etc.

    I suppose the black market trade essentially resolves this, where I sell some of my extra gallons to you at a profit. Food stamps work this way already, but since cash is the goal (not food), they get only 50c on the dollar, whereas gas would probably get a premium.

    Taken to extreme, an open trade in coupons would set the real price of gasoline, but if coupons were granted 'free' it would turn into an income redistribution mechanism from those with gasoline needs to those with excess coupons.

    it would turn into an income redistribution mechanism from those with gasoline needs to those with excess coupons.

    But that's not a bad thing. At least, most peak oilers think it's desirable to give people incentive to change their "personal situations" so they need less gas.

    Rationing would allow this to occur gradually, rather than catastrophically.

    And of course, if you have a good reason to use more gas, you could be allotted more. This happened during WWII. Doctors, nurses, police, etc., got a larger ration.

    I agree, it would be a good thing. Especially if you view natural resources as a shared resource. The average person could turn a profit by riding public transit and selling coupons, but if they wanted to rent a car to drive out to see Aunt Martha they could get what they needed as well.

    Probably the coupons would need to have a very short life, to ensure that virtual hoarding did not occur. Or maybe they'd trade in for a small value in cash at expiration, thereby incenting reduced consumption further.

    An open trade in coupons would set the real price of gasoline, but if coupons were granted 'free' it would turn into an income redistribution mechanism from those with gasoline needs to those with excess coupons.

    I'd like a plan along these lines: coupons would be distributed to every resident giving them an equal share of the total any given state gets. The state total would be a hard and diminishing cap, perhaps at 5% a year or some such depending on best estimates. Businesses and organizations would be required to purchase from some sort of a pool made of up the coupons held by residents. A three month old baby would have coupons to sell. Mobil would have to purchase coupons. After all, the baby has a stake in the planet where Mobil does not. For one hour's fuel for an F16, the military would have to purchase the annual fuel allotment of an entire family.

    Of course, something along these lines is precisely what will not be allowed by powers-that-be.

    The coupons would be good only for the right to purchase some amount of fuel - NOT for the price of the fuel. And that should go up with taxes. The expiration time is a good idea, yeah. [Sorry, I can guarantee the taxes will be spent wrong; no doubt handed directly to some fat cat.]

    The worst way to ration would be to give coupons tagged by ID or only to licensed drivers or on the basis of miles driven or somehow including businesses and organizations in the pie at the start; that perpetuates business-as-usual.

    This need to control distribution authoritatively is part of the push behind RealID. But I think RealID will spark a furious and violent backlash if it is ever used overtly in this manner. Let alone all the emergy/empower arguments that suggest it won't fly in a context of declining resources.

    cfm in Gray, ME

    I am coming to believe that such a coupon system with distributed "ownership" is the fairest way to allocate limited but shared resources while leveraging the power of capitalism to deny the "tragedy of the commons".

    Even the original sheep commons could be managed through an auction of shared-ownership grazing coupons, sharing the sheep-grazing revenue with all townspeople while managing the number of sheep permitted overall.

    Of course the more likely outcome is ownership of the sheep tokens by the local gov't entity with ensuing control of the common resource, but I digress.

    Commies, the lot a ya!



    PS. Sorry, the baby is sick; needed a cheap grin.

    For a rationing system to work long term (as compared with a temporary situation such as we now see in the southeast), a white market would need to be setup. Those who needed more could buy extra allocations from the white market. Some of the fuel available in the white market would have to be part of the allocation, while the rest would be unused "coupons". The white market would set a price for the shortage which would be above the usual pump price, thus those who were conservative would be rewarded for their savings, while those who wanted more would pay for their excess. I would think that the allocations would have a time limit, perhaps 2 weeks, after which the allocations would expire and revert to the white market with the holder being paid the white market premium.

    One can call it an income "redistribution", but who owns the fuel in the first place? Don't we, as residents of Earth, ultimately "own" it? I know, that's too radical for the Repugs out there, who think one's income is REALLY a function of one's "worth" to society, instead of the luck of the draw (or outright fraud)...

    E. Swanson

    Income in my view isn't so much an indicator of worth of an individual as a guide to the degree of need of society for certain work, but obviously the implementation is flawed. Often "qualifications" for a job serve to prevent open competition to do the work, inflating the value paid and reducing the work quantity and quality delivered. CEO pay is the case in point this week.

    I was listening to the local Cornucopian Radio this morning (Ed Wallace, who is rapidly anti-Peak Oil, but sensible in most other things), and he had an interesting comment. He was hearing from more and more dealers that are getting cars in their shops with engine damage, and tests of the fuel in the tank show ethanol percentages in the 20% to 30% range, when it should not be more than 10%.

    I don't know if this is a recent problem, with more ethanol being surreptitiously used to boost the volume of gasoline and/or a problem with blending the stuff especially as inventories get low. In any case, there could be a heck of a lot of damage to engines going on.

    I don't suppose there is any chance that it is end users adding a bottle of Everclear to their tanks to try to go a bit farther?

    I don't suppose there is any chance that it is end users adding a bottle of Everclear to their tanks to try to go a bit farther?

    I bought some of that stuff once - it's expensive! They'd have to be desperate to use that for gas.

    Since the density of ethanol is higher than gasoline (especially as ethanol picks up water), it would make sense that motorists are getting high ethanol concentrations as inventories drop. Yet another good reason to be taking the bus, until inventories are rebuilt.

    My wife's car needed some scheduled maintenance, and I called yesterday for an appointment. I couldn't get one until next Friday.

    Perhaps the ethanol guys secretly wanted to destroy the car fleet and force us all into riding bikes and taking mass transit.

    No explanation behind the assumptions, sorry.

    My understanding is that rationing coupons were printed up in 1980 at the end of the Carter presidency in preparation for rationing which (thankfully) never happened. These coupons are reportedly stored underground in a salt mine in Kansas.

    I've heard that, too, but have not seen that substantiated. The way Simmons was talking it sounded like the people at the EIA did not rush to correct his understanding that the coupons were not yet printed.

    Oh, they were printed all right (but in 1974, not 1979. Also see archive headline here.) The crisis ended just before they were to be mailed out. IIRC it was by car registration, so the more cars you owned, the more coupons you would have gotten.

    Later, they were shredded:

    The coupons are being shredded and buried because they could trigger dollar-bill change-making machines.

    LOL. However, the early dollar bill changers had very poor capabilities.

    I'm bemused by how fast history gets forgotten nowadays. The event was 35 years ago, and it's already subject to so many narratives and interpretations that you'd think it had happened in the age of Pericles.

    "Coupons for gasoline rationing were printed but were never actually used during the 1979 crisis. [8]" From the Wiki entry on 1979 energy crisis.

    The references are confused. They were indeed printed in '73-'74 and stored in several places and then brought together in Pueblo, Co. according to this reference. http://news.google.com/newspapers?nid=932&dat=19790507&id=X_kOAAAAIBAJ&s...

    I'm bemused that you're bemused...I was four years old in 1974.

    Well, see, now I'm even a little more bemused. After all, most of history is what happened before you and I or anyone else reading this was born. That's why it's called history instead of being called personal experience. It's something passed down, oftentimes through those objects referred to as books.

    That an easy-to-summarize and moderately important event 35 years ago - which was in part a significant grab of peacetime governmental power over the populace - should already seem as if it were contemporary with the construction of the Pyramids, and be subject to almost as much hearsay and confusion, well, YMMV but it just strikes me as bemusingly...ah, there's the word, solipsistic...

    ...through those objects referred to as books.

    I was wondering why people were stacking all that paper up in one place and then gluing one edge together. I thought they were just trying to keep the place tidy.

    Iam bemused you are up so late posting on TOD, shouldnt you be in bed? Kids these days..pffft

    Great drumbeat Leanan. Yes the fact is we are low on gas? Is it because we don’t have enough in our ground? NO There has been collusion IMO to reduce the supply to create the fear of peak oil. But why? If you recall, the US is in 6.9Trill in trade deficit Further Reading
    . But how would saying we have a shortage be helpful? Well… We were able to change a bill that was passed over 20 years this past week if any of us recall Monday morning. The US lifted their off shore drilling ban. Therefore the exploration WILL continue, and very close to the US home. Perhaps this is in place to create jobs? After all manufacturing in the US is basically dead. Or maybe the new tax on oil companies in an effort to fund the green movement ? JOB CREATION. The US gov is thinking ahead, however they are not disclosing their intentions. They just say and do. If they were to explain the rationale behind their actions we would have a much more transparent system and the overall market sentiment would be strengthened. Just, be honest.

    Valero's Texas City Refinery Resumed Production:

    Exxon's Beaumont City Refinery May Take Months to Repair:

    Total Refinery in Port Arthur Ready to Start:

    B.P. To Restart Texas City Refinery

    Hello TODers,

    In stark contrast to our efforts at Peak Outreach and the further promotion to encourage lifestyle shifting to WT's ELP, others are delusionally pushing for the exact opposite:

    Attract Money Today Affirmations [2:10 viewtime]
    Lots more of these sad videos available.

    This photo below shows a child with more innate Thermo/Gene Collision understanding [Can you see the pretty pink teddy bear backpack?]:


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

    MCCAIN: Look, we are sending $700 billion a year overseas to countries that don't like us very much. Some of that money ends up in the hands of terrorist organizations. We have to have wind, tide, solar, natural gas, flex fuel cars and all that but we also have to have offshore drilling and we also have to have nuclear power.

    Senator Obama opposes both storing and reprocessing of spent nuclear fuel. You can't get there from here and the fact is that we can create 700,000 jobs by building constructing 45 new nuclear power plants by the year 2030. Nuclear power is not only important as far as eliminating our dependence on foreign oil but it's also responsibility as far as climate change is concerned and the issue I have been involved in for many, many years and I'm proud of the work of the work that I've done there along with President Clinton.

    OBAMA:The second point I want to make is -- is the issue of energy. Russia is in part resurgent and Putin is feeling powerful because of petro-dollars, as Senator McCain mentioned.

    That means that we, as one of the biggest consumers of oil -- 25 percent of the world's oil -- have to have an energy strategy not just to deal with Russia, but to deal with many of the rogue states we've talked about, Iran, Venezuela.

    And that means, yes, increasing domestic production and off-shore drilling, but we only have 3 percent of the world's oil supplies and we use 25 percent of the world's oil. So we can't simply drill our way out of the problem.

    What we're going to have to do is to approach it through alternative energy, like solar, and wind, and biodiesel, and, yes, nuclear energy, clean-coal technology. And, you know, I've got a plan for us to make a significant investment over the next 10 years to do that.

    And I have to say, Senator McCain and I, I think agree on the importance of energy, but Senator McCain mentioned earlier the importance of looking at a record.

    Over 26 years, Senator McCain voted 23 times against alternative energy, like solar, and wind, and biodiesel.

    And so we -- we -- we've got to walk the walk and not just talk the talk when it comes to energy independence, because this is probably going to be just as vital for our economy and the pain that people are feeling at the pump -- and, you know, winter's coming and home heating oil -- as it is our national security and the issue of climate change that's so important.


    Obama had multiple opportunities to stop talking after making a particularly good point. The whole last paragraph is unneeded and would have left people with the thought about McCain voting against alternative energy so often.

    I'm really wondering if there's any point to debates any more.

    The comment I've heard most often about last night's debate is about Obama's stuttering, and how disappointing it was from someone who is supposed to be such a good speaker.

    It reminds me of the Bush-Gore debate where the takeaway was about Gore sighing.

    Seems like nobody cares what they say. It's all about how they look. Might as well have a swimsuit competition and be done with it. ;-)

    I think that would be a slam dunk for Obama.

    Great. Thanks for the image. Now I have to go wash my eyes out with bleach.

    No, no, a thousand times no! We do Not Want a swimsuit competition to determine the McCain/Palin or Obama/Biden winner:

    Sarah Palin swimsuit video
    We want her to open her mouth as much as possible until election day. Please see Couric/Palin interview.

    Where's the porn?

    I watched the absurdly comical Palin/Couric interview on the Net-someone commented that here is a person that has gotten where she is because of beauty, aggression and meanness, and basically that is what America values. The USA public overall doesn't have a lot of respect for obvious intelligence-it is considered a sign of weakness or elitism.

    We could vote on the basis of supporter's videos:

    Obama: Yes we can


    McCain Inspires a Nation With Just Three Words:


    Or we could vote for the candidate who had the foresight and judgment to oppose the invasion of Iraq--when it was a politically unpopular thing to do.

    I'm going to vote for the candidate who says no to "cash for trash."

    I hope you're not seriously undecided about supporting Obama still? Seriously Hillary lost.

    What does Hillary have to do with this?

    I feel very strongly about this bailout issue. I won't vote for anyone who supports it. Hillary, Obama, McCain, even Jesus Christ himself won't get my vote if they support this ripoff.

    (But don't worry, my vote doesn't matter. I don't live in a purple state. It's one of the few benefits. Sure, the candidates ignore you, but you get to vote your conscience.)

    Eh I agree with you the bailout isn't great, but what are you going to do if both Obama and McCain vote for it? Support Nadar/Barr? I guess you're in a state that Obama won't win, I just fear there are those in swing states that will do just what you're saying. Think of how much of a different world we would live in now if just 1000 of those nadar supporters in Florida had voted for Gore! Sometimes it is necessary to put away principle and vote for the what you perceive to be the lesser of two evils. I hope everyone in a swing state will think carefully about that.

    Eh I agree with you the bailout isn't great, but what are you going to do if both Obama and McCain vote for it?

    Vote for neither of them.

    I guess you're in a state that Obama won't win

    Or that Obama can't lose.

    I just fear there are those in swing states that will do just what you're saying.

    Not my problem.

    Imagine what might have happened if Gore had convinced Nader to be his running mate instead of that &%*#*!@ Lieberman.

    That really is mind-boggling. The guy who ran for VP as the Democratic candidate eight years ago was a speaker at the GOP convention this time.

    And if McCain had gotten his way, might well have been the Republican VP this time.

    And if Kerry had gotten his way, the 2008 GOP Presidential candidate might have been the 2004 DNC VP candidate.

    I'm going to "vote" in whatever way will maximize chaos. We've settled into a structure that is killing us and marginal changes - or the false hope of marginal changes - only make it worse - a tightening of the screws if you will. We need to boil and settle out to a new structure. No, there is no guarantee that it will be better.

    Gaia dances with Shiva.

    cfm in Gray, ME

    Anarchists of the world unite?

    Dryki - Interesting that you bring up Shiva. In Hindu mythology there are two aspects to Shiva. The first Tandava displays Shiva in the aspect of deep meditation. The other image commonly associated with Shiva is Nataraja, the Lord of the Dance.

    Natarajo is by far the most stirring of the image of the Hindu God Shiva. In this graphic image Shiva is surrounded by fire representing the beginning of the world: which is created in fire. The right foot of the God is supported on the back of the dwarf which represents ignorance from which all knowledge manifests. The locks (hair) of the yogi(Shiva) swirls with the wind of change manifesting skulls of the dead lost like bubbles to a boiling pot. The ears of the god have jewels representing both Yin and Yang the opposite aspects of mammalian life. The left leg is held outstretched across the body of the god with the upper left hand pointing to the left ankle which implies elephant. Elephant to a Hindu means to go directly to your goal as the elephant goes through the jungle. The lower left hand holds fire which implies your mortal death. The upper right hand holds the drum which signifies the beat of time sogmofuomg our journey through mortality. The lower right hand is held out with palm outward in the fear not gesture reassuring the aspirant that the journey in spite of all of the mystery is is safe.

    Legend is that when the God ceases to dance that is the end of the universe, or at least this chapter. That's how he became the God of Destruction.


    I'd have a hard time voting for somebody who would trash the Second Amendment just when we're likely to need it.

    Yes, absolutely.

    In every way.

    I only saw parts of it, but the stuttering was hard not to focus on. Even when I tried.

    Honestly, though, I wonder what either of them could say that would have any more significance than, "I'll say whatever I can to get your vote. Specifically, if you happen to be a swing voter."

    When we live in what is in aggregate the most corrupt society in history, what people say is irrelevant. We have to watch what they do. If they don't do anything that is of any benefit to us, then there actually is a incentive to vote for the most incompetent and for complete lockup and stand still.

    Like anything else, if one can't win then one plays not to lose.

    Then all is left is cosmetics.

    I would expect a large % of the population to consider the Obama's in the WH unacceptable on this basis alone, and it isn't just race, many of these people would accept for example a Colin Powell.

    So Obama reckons that Venezuela is a ''rogue state''


    The United States is mulling what measures to take should Russia exploit the oil or minerals of two Georgian breakaway provinces it invaded last month, U.S. Secretary of State Condoleezza Rice said on Friday.

    Ah, good 'ol Minitru. We've gone from Russia's counterattack against Georgian agression being an invasion to Russia's OSCE-sponsored peace keepers' presence in S. Osettia and Abkhazia being an invasion. Next we'll be considering sanctions against the Russian invasion of Murmansk.

    That whole peninsula is Karelian...

    Hello everyone,

    I wrote the following to explain why Peak Oil renders recovery from the current economic crisis, and a return to "business as usual," probably impossible. I sent it to an unabashed enthusiast for the Paulson plan, whose defense of it may be accessed here (scroll down to the piece by Robert T. Miller):


    I would like to refine my understanding of things by opening up my way of looking at things to TOD comment and critique. Please fire away!

    As is the case with many things that have been unfolding over the past year, the present financial crisis is something that Peak Oil-aware commentators have been predicting would happen for quite some time now (see, for example, James Kunstler's 2005 book, The Long Emergency, which contains an entire chapter on this issue). And not only is it happening as they predicted, but it is happening essentially right on schedule.

    Now Peak Oil and other energy resource limitations are not necessarily held to be among the principal proximate causes of the crisis by Peak Oil-aware commentators. These proximate causes have a lot more to do with reckless policies by Alan Greenspan and others in government and regulatory positions that led to an environment where all kinds of actors in the financial world were able to take precipitous and dangerous risks without the requisite "moral hazard" being in place.

    However, the present reality of world Peak Oil and its imminently looming cousin peaks among other energy sources, especially natural gas and coal, will play an essential role in preventing a resolution of the crisis in anything like a "business as usual" sense. On the most fundamental level, it will do so because hard limits on energy availability eliminate a basic condition necessary for the continuance of economic expansion, namely, an abundance of inexpensive energy to provide the physical basis for the economic work involved in economic expansion (work being understood here in the sense that physicists use the term). Yet it is this very process of continued economic growth that is being counted on in the present crisis to stanch the continuing slide in the housing market by reigniting growth in demand and thus in prices for housing, and thus to provide an economic basis for retiring some of the debt currently bedeviling the system in an orderly fashion

    There is now little doubt that we have been in the period of the Peak of world oil production for a full four years now; as such, there is every reason to believe that future growth in demand for housing is infeasible, and that we are therefore in the beginning throes of economic convulsions that will exceed the Great Depression of the 1930s in their magnitude. (Whether these economic convulsions will take a hyperinflationary or radically deflationary form, or some hybrid of the two, is something that is vigorously debated in Peak Oil circles; but there is a widespread consensus within the Peak Oil community that these convulsions are inevitable, regardless of any measures taken at this point to try to avert them.) Here are some of the ways in which skyrocketing food and energy prices have been and will continue to affect the economy in ways that make a continued collapse in housing prices, and therefore in overall economic activity, inevitable:

    1) Skyrocketing food and energy costs are reducing the purchasing power for consumers of other things - including housing. Peak Oil makes it inevitable that this direct drag on demand for housing will be of indefinite duration, and will in fact only worsen as prices for food and energy continue to rise (as they surely will over the longer term).

    2) These same skyrocketing energy costs are also acting very directly to depress the price of much of the most recently built stock of housing in the so-called "exurbs," due to the growing energy costs both of travel to these houses and of their heating and cooling. This particular effect is making itself felt most notoriously and spectacularly among exurban "McMansions;" already there are recently middle-class suburbs of places like Cleveland and Las Vegas that are transforming into economically worthless slums, and there is every reason to believe that this process will only continue, as the inexpensive energy required to arrest the decline in value of remotely situated housing is now a thing of the past.

    3) More indirectly, the drag in consumer demand both for housing and for other consumer goods will lead to growing unemployment in such sectors as the home building industry and its adjuncts, the automotive industry and its adjuncts, and the retail industry and its adjuncts. Growing unemployment in these sectors will in turn shrink the pool of candidates available to reflate the demand for housing, and thus the price of housing, even further.

    4) The continuing downward pressure on housing prices due to factors 1 through 3 will in turn cause a continuing decline in the value of the stock market and other investment vehicles, due to profitability declines and bankruptcies among the panoply of industries adversely affected by declines in consumer spending. This in turn will adversely affect the financial fortunes of many whose anticipated comfort and prosperity is strongly staked in the fortunes of the stock market and other conventional investment vehicles. As such, the inexorably declining stock market constitutes yet another factor that will contribute to the continuing deflation of housing prices on account of the associated decline in consumer purchasing power. (I might also mention, as an aside, that there is a very good likelihood that tens of millions of people who are today counting on a comfortable retirement on the basis of such investments are instead in for the rude shock of facing an old age of penury. The younger the person in question, the greater is the likelihood of this coming to pass, all other things being equal.)

    5) The wave of foreclosures that is among the principal contributors to the drop in housing values is by no means over; on the contrary, additional waves of foreclosures on already existing mortages from higher grade forms of loans than the so-called "subprime" sector are set to swamp the economy over the course of the next year or two. The next shoe to drop will be the so-called "alt-A" loan market, as many of these loans are primed to reset over the course of the next year or so. This very predictably unfolding process, too, will act to further depress housing prices.

    6) Factors 1-4 will make many more people vulnerable to foreclosure than might have been the case in the absence of the downward economic spiral that these factors portend. This is all the more the case in that millions of American homeowners are in debt up to their eyeballs for all kinds of things other than housing.

    All the factors mentioned, as well as others not discussed, tend mutually to reinforce each other. As such, anything the government does to loosen credit temporarily cannot reverse this dynamic. Peak Oil and its attendant consequences cannot be stopped by tinkering with the present economic system, relying as it does on a no-longer-tenable process of continuous expansion for its fundamental viability. Instead, the system itself must be fundamentally changed in a way that is congruent with the inescapable realities of declining energy supply. The impending Great Depression will accomplish that for society - although much of the attendant "collateral damage" will not be pretty.

    What you are saying sounds a whole lot like what I have been saying. This is a link to a copy of my ASPO-USA presentation, Peak Oil and the Economy (large PDF). I want to write up something about it soon.

    If people want to look at other presentations, they can be found here.


    Interesting proposal about reworking (reforming?) the monetary system.

    But at the end of the day isn't all of economics based on trading promises and then living up to those promises? i.e. You do X for me and in exchange I'll do Y for you.

    This financial house of wax "meltdown" came about because Joe Sixpack couldn't live up to his end of the bargain, namely, I'll pay whomever is the holder of my mortgage paper, Z dollars per month for the next 30 years. Sounded plausible in the beginning except that Joe recently lost his job --or was downsized to a lower paid situation--, and the price of basics: fuel, food, etc. was steadily increasing, and now Joe cannot meet his end of the promise. In turn, those who sold the paper can't meet their promise or warranty that the paper will provide a steady revenue stream for the remainder of the 30 year mortgage term.

    Breaking News: Nancy Pelosi is at the moment announcing that a deal or "fix" has been agreed upon by our fear mongering leaders.

    Hello Step Back,
    No, Joe Sixpack did live up to his end of the bargain, where there bargain was: I'm paying the credit or You take this home. The bank got the home.

    No, Joe Sixpack did live up to his end of the bargain

    We're not "blaming" Joe Sixpack for being in this current predicament.

    Instead the issue is that of monetary policy.
    How does the government decide how much money (M1, M2, M3) should be floating out there, how much debt (D1?) should be floating out there, and assuring that everyone can keep up his part of the bargains made between lenders and borrowers?

    Gail is suggesting that something went terribly wrong with the current system and we need to somehow reform or change it.

    So what exactly went wrong and how do we reinvent the system?

    So what exactly went wrong and how do we reinvent the system?

    Scientists, and certainly economists don't really know how the system works. Why economic theory is out of whack The problem is that while money itself is quite simple, the interactions that are possible using it create a complex system with emergent properties. Since Tulipmania in 1637, bubbles appear to be an inherent feature of the system.

    Perhaps you could fix the system by using non-fiat currency, banning lending except under strictly controlled circumstances, etc. The problem there is that a steady-state economy stifles growth. Built on these principles, the USA would not be a superpower, and it's people still a nation of poor farmers and ranchers. The American Dream, aka "Get rich quick!" could not exist.

    Since America is a "democracy", the people would quickly ditch the austerity economy and vote for anyone who promises a growth economy. Trying to enforce austerity and government control doesn't work for long.

    So "what went wrong" is that people naturally desire growth, and will always gravitate towards an economic system that promotes growth. How do you fix human nature?

    Thanks for your feedback, Gail. I consider your own writings an excellent benchmark. Probably I got some of my ideas from perusing your stuff in the past, but it's still helpful to put these ideas into one's own words, especially since they are complex.

    Do YOU see any way out of a Great Depression at this point?

    ...namely, an abundance of inexpensive energy to provide the physical basis for the economic work involved in economic expansion (work being understood here in the sense that physicists use the term). Yet it is this very process of continued economic growth that is being counted on in the present crisis to stanch the continuing slide...

    I think you weaken your most important fundamental argument by trying to link it so directly to the housing and food crises. Anyone can then start to pick you apart by resorting to the host of "above ground factors". Getting into the details of the mortgage system isn't really relevant to the fundamental argument either, and that opens you up to critiques on irrelevant points. Add a third argument so it's clear they are all examples (I like to use the melting ice caps). I'm not criticising your points - only the relative weight you give them in this short presentation. Standard disclaimer, grains of salt and so forth. And of course it depends on your audience. This is hard stuff to understand and hard to communicate.

    FWIW, what you are saying is very much related to my "humpty-dumpty" argument; that things will not and cannot go back together again and that the more effort is put into trying to do so the more effort is wasted.

    I'm going through Odum's "Environment, Power and Society for the 21st Century" for the third time now - this time I bought it so I could highlight and fill it with marginal notes. It continues to blow me away. One bit of trivia, in 1975 Sen Mark Hatfield got legislation passed requiring net emergy evaluations of all federal projects.

    Human beings used to be smarter than yeast.

    cfm in Gray, ME

    Singular human beings are smarter than yeast.
    Human society ... not so much.

    I blame 'writing.' Hard to get to this level of technological civilization just based on what each generation can memorize.

    Abrams, "The Spell of the Sensuous", all about that.

    John Andrew Boehner, the House Minority Leader, just came out with the Republican group position on the Bailout and they have completely split with the Bailout.

    This isn't often that I am in agreement with Republicans but on this issue I'm with the Republicans.

    They want: No bailout, government will allow Wall Street Firms to purchase Insurance to bolster weak investments.

    These guys look like leaders for a real change!

    The main problem with the whole proposal is the incredibly blatant corruption-if ENRON had come along a little later, that company would be right near the front of the line and Skilling, Fastow and Lay would have been able to engineer a far larger fraud using the taxpayer as a capital source. The situation is that overall the USA banking sector is very weak (insolvent) because of widespread fraud, and the proposal was to transfer taxpayer money to the most fraudulent firms-these firms have been stealing from their shareholders and now they want to steal directly from the taxpayer (actually they already have through Fed actions). If one actually was interested in strengthening the USA banking sector using taxpayer funding, the funding would be allocated to the most honest and successful banks, allowing these to strengthen and raise even more capital. You will notice no one is proposing a government investment fund that will take large equity positions in the most well run (using lower leverage) and prudent USA financial institutions, allowing these to grow even stronger. It is evident that there is zero interest (with the notable exception of the rebel Repubs) in structuring a reasonable (non scam) subsidy program for the banking industry.

    I agree that any plan should nationalise any failing companies.
    However, the Dodd plan from what I gather sounds marginally less awful than the Paulson scam, sorry, plan, - the devil is probably in the details though, and it will likely bankrupt everyone else for the benefit of the banking elite:

    "something Really smells here!" David Letterman

    Seahorse points out that one of the purposes of these "creative" financial vehicles was to avoid paying US taxes.

    Yes, his description is probably over-simplified, but jeez, it's ironic. They set up this house of cards to avoid paying taxes...and now they want taxpayers to bail them out?

    That's nothing new. Every trans national corporation has been minimizing if not avoiding taxes for a long time via corporate transfer payments.

    Most off shoring is tax related.

    Yeah, but they don't expect to be bailed out with taxpayers' money. Or at least, they shouldn't.

    No, and neither are the commercial banks and thrifts. They will go down either way if insolvent like WAMU, and their senior bond holders will be equally robbed. Within days (or maybe a week or two if they are real dense) people will figure it out, and this is about how much time the 700b will buy.

    Whatever Paulson and Bernanke can extort out of congress will go to primary dealers, and none of it will be reinvested, used to facilitate liquidity, or even stay in the US.

    It is a pure heist by oligarchs that have primary loyalties other then the US.

    I hope they stick to their guns. No bailouts for billionaires. I think Denninger's idea is better. What we need is transparency, not this taxpayer boondoggle.

    Then there's what Sweden did:

    Can the U.S. learn any lessons from Sweden's banking rescue?

    A banking system in crisis after the collapse of a housing bubble. An economy hemorrhaging jobs. A market-oriented government struggling to stem the panic. Sound familiar?

    It does to Sweden, which was so far in the hole in 1992 - after years of imprudent regulation, shortsighted macroeconomic policy and the end of its property boom - that its banking system was, for all practical purposes, insolvent.

    But unlike the United States, whose Treasury has made a proposal to deal with a similar situation, Sweden did not just bail out its financial institutions by having the government take over the bad debts. It also clawed its way back by pugnaciously extracting equity from bank shareholders before the state started writing checks.

    That strategy kept banks on the hook while returning profits to taxpayers from the sale of distressed assets by granting warrants that turned the government into an owner. Even the chairman of Sweden's largest bank got a stern answer to the question of whether the state would really nationalize his bank: Yes, we will.

    Its perfectly simple:

    Any one above asst dep. head in any bank or similar should be fired immediately without any compensation

    That is the price I would extract for the bail - out.

    Its perfectly simple:

    Better yet: Public stockades and put every MBA professor who taught "financial" hocus pocus in one of them.

    OOps, a problem with that proposal: peak wood.

    The Republican "insurance" proposal is in my view a time-bomb. No money up front, but a huge liability later, since it puts the risk onto the insurer (i.e. us taxpayers). If the banks were to pay an "insurance premium" large enough to cover the risk, it would not help them out (and they don't have the money).

    Perhaps it's just a ruse to make things look peachy-keen long enough to have an election. That's why it's the R's proposing it, and the D's sticking to the up-front bailout.

    Nobody in Congress is talking about real alternatives, such as financing the good banks instead of the bad ones, or setting up a new National Bank, or investing in things of real value such as infrastructure and alternative energy.

    With regards to: Russia to build missile defence shield and renew nuclear deterrence.

    Sounds like Russia is using a play right out of the Reagan playbook. Out spend us and hope the United States economy collapses. Seems like deja-vu only the tables have turned.

    Think we could look into Putin's lying eyes and determine what their intent is? Bush et all must be squirming with the russians cozying up to Chavez. One more step toward the inevitable expansion of the resource wars.

    Jeffrey, I'm studying Well's presentation from Sunday night at ASPO.

    Some of the optimistic assumptions I caught while listening were large increases in production in Iran and especially Iraq, but I missed his Saudi production forecast -- it doesn't seem to decline for the foreseeable future.

    In a subsequent slide he writes:

    Major potential for new capacity is in four countries:
    –Saudi Arabia(potential 2-3 million b/d) –underway but technical risks
    –Iran(1-2 million b/d) -stymied by politics
    –Iraq(4-5 million b/d) -major political/security risks
    –Venezuela tar sands (>2 million b/d) –resource nationalism

    Despite the caveats, you can see in the following slide that he is clearly expecting crude oil production to surge.

    OPEC Crude Oil

    Leading to a peak in world liquids production in 2020.

    World Liquid Balance

    This seems awfully optimistic.

    Some of the factors I see playing a role are:

    • the decline rate he uses could become much higher
    • project delays push that new oil further into the future
    • resource nationalism ("keep it for the next generation")
    • EOR isn't as high as he models

    At the same time, Laherrere's model shows a break in 2010, an eight year plateau and only a 2% decline.

    These two models are different than the model you are working on.

    Did I catch the major differences between these models and your own?

    The full presentation is here:

    While hope springs eternal for Venezuela, the fact remains that they have shown 10 straight years of declining net oil exports, with a very rapid current rate of increase in consumption. Their net export decline has averaged 100,000 bpd per year for 10 years. Extrapolated out, they will approach zero net oil exports in 20 years. And of course, our middle case has Saudi Arabia, Russia, Norway, Iran and the UAE collectively approaching zero in 23 years.

    I had a chance to talk to Robert Hirsch at ASPO, and while he was generally familiar with our net export work, he had never really looked into the deceptively simple--and economically deadly--net export math, so I sent him an email with a summary of our work and with several links. I just sent the author of the recent Fortune article on Matt Simmons a version of the same email, with some added material. Here is that email, especially for the benefit of any new readers:

    Mr. O'Keefe,

    Your recent article on Matt Simmons was very good, and I have long
    thought that Matt is to the emerging oil crisis as Winston Churchill
    was to the years prior Second World War.

    You are of course correct that evaluating reserve estimates is a
    difficult subject, which is why I am a fan of the logistic method
    (commonly referred to as Hubbert Linearization, or HL). We use a plot
    of the ratio of annual production to cumulative production versus
    cumulative production to estimate the recoverable reserves for a
    region. Here are two articles that discuss the method:

    Texas and the Lower 48 as a Model for Saudi Arabia and the World (2006)

    In Defense of the Hubbert Linearization Method (June, 2007)

    While no method is perfect and while the method is dependent on the
    quality of the data (which varies), in my opinion this is the best
    method we have for deriving a relatively objective estimate for the
    recoverable reserves from a mature region, and I think that the data
    errors tend to average out with time.

    However, the primary problem that oil importers face is an accelerating decline in the volume of net oil exports. BTW, Matt Simmons is very familiar with our work, and we built on some prior work that he did on the rapid increase in domestic consumption in importing countries.

    "Net Export Math" is deceptively simple, but I believe that it will
    actually be quite deadly to the world industrial economy. I have used
    a very simple little mathematical model, the Export Land Model, or ELM, which assumes that a country--with two mbpd of production, one mbpd of consumption and one mbpd of net exports--hits its final peak and begins declining at -5%/year (roughly the same decline rate as Texas and the North Sea) with a +2.5%/year rate of increase in consumption. This results in net oil exports going to zero in 9 years. Even with no increase in consumption, they would go to zero in 14 years. A key assumption is that domestic consumption is satisfied before oil is exported.

    Assuming the +2.5%year consumption increase, and assigning some reserve numbers, Export Land would only export 10% of their post-peak production, with 90% of their post-peak production being consumed locally.

    The effect of an exponential production decline and an exponential
    consumption increase produces a net export decline that tends to
    approximate a linear decline, i.e., approximately a fixed volumetric
    decline per year. This of course results in an accelerating decline
    rate, that looks something like this:

    1/10 (-10%/year); 1/9 (-11%/year); 1/8 (-12.5%/year); 1/7
    (-14.3%/year). . .

    We (Brown & "Khebab" on The Oil Drum) looked at two exporters, the UK and Indonesia, with radically different demographics and energy tax/subsidy policies, but they both were consuming about half of their production at final peak (like Export Land). The UK went to zero net oil exports in seven years, Indonesia in eight years, and they both showed accelerating net export decline rates.

    By the way, Mexico--like Export Land, the UK and Indonesia--was
    consuming about half of their production at peak production and is
    showing a rapid net export decline rate, probably approaching zero net
    oil exports within eight years of their 2004 production peak, i.e.,
    probably by 2012.

    We next did some detailed mathematical modeling for the future
    production and consumption for the top five net oil exporters (Saudi
    Arabia, Russia, Norway, Iran and the UAE), which account for about half of world net oil exports. Our middle case shows them collectively approaching zero net oil exports around 2031, and they have collectively shown two years of net export declines, relative to 2005, and as predicted, they collectively showed an accelerating decline rate.

    Even Saudi Arabia, which is showing a year over year increase in
    production and exports, will still be down quite a bit from its 2005
    rate. Here are the EIA total liquids net export numbers for Saudi
    Arabia, and my estimate for 2008:

    2005: 9.1 mbpd
    2006: 8.5
    2007: 7.9
    2008: 8.4*


    Note that the 2008 rebound will probably be around 700,000 bpd below their 2005 net export rate.

    The EIA shows two years of total net export declines worldwide, with an accelerating net export decline rate, down -1.1%/year for 2006 and -2.2%/year for 2007.

    Our point is that Peak Oil, from the point of view of importing
    countries, is effectively here, and unlike the simple Peak Oil
    exponential model, we believe that we will continue to see an
    accelerating net export decline rate. My guess is that world net oil
    exports in 2031 will be down by about 75% from the 2005 peak rate.


    Jeffrey J. Brown

    Two Links:

    Here is a link to a recent (July, 2008) presentation of our work that I
    gave at Sandia Labs, which was videolinked to two other national
    laboratories (you should see two windows--the video and our slides).


    And this is a link to our paper on the top five net oil exporters:

    A quantitative assessment of future net oil exports by the top five net
    oil exporters

    Thanks, Jeffrey. I had noticed that he did not include the effects of your Export Land Model, either, and I hadn't realized that Venezuela's was an optimistic forecast as well.

    The other thing I just fully realized is that despite all the risks he lists for the production increases his model counts on, he doesn't seem to apply a reduction factor at all to the numbers.

    For instance, if for Iraq he is saying 4-5 mbd of new production, but there are "major" political/security risks, wouldn't it be prudent to model 4-5 mbd x 0.5 instead? This is perhaps a longer way of saying what Darwinian noticed below.

    In fact, he really does seem to be assuming the best case occurs in each area he looks: Iran, Iraq, Saudi Arabia, EOR, etc.

    It certainly seems to me that yours and ASPO's numbers are more likely to occur (unfortunately).

    The thing that I continue to find absurd is CERA, et al's assertion that the world--the sum of the output of discrete producing regions--will not show the kind of peaks we have seen in discrete producing regions like Texas and the North Sea. It's really only a slightly less ridiculous version of the "Huber Curve," to-wit, that discrete forms of energy will peak and decline, but our aggregate energy production will increase forever.

    supberb...(im hearing the scary part)i think the scary part for the relativley new producers like azeri,angola,they will peak early and decline quickly,and in that time they will ramp up consumption only to fall off an economic cliff.how do you see this playing out.thanx r.m.

    I think he uses some of the same kind of thinking as CERA. I presume ASPO-USA is not really endorsing this kind of thinking. They have been criticized in the past for not showing both sides of the story.

    I thought that the most interesting part of his talk was his offhand comment that the north end of Ghawar would be effectively watered out in two years.

    That comment was in response to my written question.

    Given Ghawar production will soon shift to oil stained water, I cannot see how the rest of his Saudi projections "make sense".

    And how can ANY oil analyst so casually refer to the depletion of Ghawar ?



    Aangel, you have Iraq more than tripling their current production. Where do you get such number? That fact alone puts all your other predictions in grave jeopardy. How can anyone who predicts that Iraq will triple their current production be taken seriously? Iraq is currently producing about 2.4 mbd. Will they ever produce 7.4 mb/d? Good God man, get real!

    Ron Patterson

    Those aren't his predictions. They're from Peter Wells' presentation at ASPO. He gives a link.

    It simply doesn't matter, one should not post statistics or predictions that one does not support. He posted them, therefore he must support them. Of course if he posted a disclaimer then that would be different. If he had said something to the effect; "look at these absurd predictions". But he did not. That chart is totally absurd! Anyone who posts absurd charts apparently also supports them.

    Sorry for the rant Leanan but why does anyone post such crap if they do not support it?

    Ron Patterson


    Sometimes you go over the line. Surely we can post info that we don't "support" to explore what is out there. Don't you want to know the disinfo that's being spread around?

    When you disagree with someone, you can say that you disagree. But your language lately seems to run to "totally absurd", "utter crap", "completely ridiculous", etc. Your absolutist, totalizing language is frankly, tiresome and rude. It just shuts down any chance of dialog or learning.

    Which is too bad, because I mostly agree with your viewpoint on things. But not everyone is as omniscient as we are ;-) You can afford to dial back a notch.

    Yeah, I often go over the line. I really enjoy doing that. ;-) The data was posted with NO explanation as to whether the data was reliable or not. The idea that Iraq will triple their current production is totally absurd. (In my opinion anyway!)

    It is called a disclaimer! And example: The following is the opinion of such and such and does not represent my (the poster's) opinion. Or just: Such and such says this but I do not necessarily agree.

    However perhaps you have a different opinion. Perhaps you think Iraq will triple their current production. If so, please explain why you think that will happen.

    And I have no intention of dialing it back a notch. When I see such carp as a prediction that Iraq will TRIPLE their current production, I will call it totally absurd! And if the poster of such carp does not support such crap, then he should make that opinion obvious.

    Thank you for your kind attention.

    Ron Patterson


    aangel did include a comment at the end of the graphs he posted: "This seems awfully optimistic." Earlier in the same post, he wrote "Some of the optimistic assumptions I caught while listening were large increases in production in Iran and especially Iraq..." I think you owe aangel an apology and yourself some new reading glasses. Save your smackdowns for those who really deserve it.

    You are correct Brother, I got a little carried away. Please accept my apologies Aangel. I was trying to watch football and read posts at the same time. I should know better. But both my Alabama teams are winning so I have some consolation. Well, one won 14-12 and one is ahead 31 to zip at halftime. Hell, I should just give up posting on weekends altogether. Perhaps I should just give posting altogether if this is the best I can do. My heart is just not in it anymore.

    Apology accepted. I was in fact posting to engage Jeffrey in a discussion about Peter Wells' model. Rather than email him directly, I thought others might want to listen in.

    It simply doesn't matter, one should not post statistics or predictions that one does not support. He posted them, therefore he must support them.

    That's just silly. Maybe he wanted some criticism? Or just thought they'd be of interest?

    Sorry for the rant Leanan but why does anyone post such crap if they do not support it?

    You're asking me, the person who posts a ton of crap I don't support every day, at the top of the DrumBeat?

    CNG as vehicle fuel.

    It could work out a lot cheaper to retrofit millions of SUVs with CNG than replace them with cramped, expensive and short range PHEVs like the Volt. Soccer moms will have the big car they say they need. If necessary include a speed limiter to say 60 mph/100kph as part of a tradeoff. If you really need a behemoth then put up with the speed limit.

    Those CNG fitted cars could run for another decade saving huge amounts of energy that would be embodied in the replacement fleet. Rebates could assist with the cost of the conversion and in some cases for home filling equipment. However governments would have to set fuel tax or excise at a low level for many years, no more than a few cents per cubic metre, kilogram or heating unit. As Pickens says gas supplies might last longer and stay cheaper if wasteful uses like baseload power generation were cut out.

    The conversion market is currently highly regulated, with an expensive (anecdotally $200K) EPA certification for every conversion model and engine. So far, this has limited aftermarket conversions to fleet needs for large expensive vehicles, which means work trucks.

    Some of this can be argued for safety, but other than requiring proper tanks and tubing the risks of conversion are not notably different than for any back-yard hot-rodder, and those parts exist in vast abundance.

    It would be difficult to make a CNG conversion that polluted badly and still performed well, so it seems to me that some relaxation of laws is in order, or funding of type-testing. The market SHOULD be willing to produce low-cost kits for minivans, SUVs, and even compacts, as such kits are available in India and elsewhere where capital is constrained as well.

    Today the Honda GX is the only production car in the US that supports CNG, and they are halting production for 6 months. New orders placed today will deliver in approximately one year. It is worth noting that a CNG conversion will not be as efficient as the native-CNG GX as the GX takes advantage of the higher octane with a higher compression ratio. It's equivalent mileage is approximately the same as a standard Civic, and existing rebates cover most of the cost spread.

    Compressed CNG is available near my house for $1.14. It's gone WAY up from the $.92 per gallon-equivalent of earlier this year.

    A low-cost, gov't supported conversion could go a long way to saving low-income hand-me-down owners of deflated trucks and SUVs from a high-cost, low-supply gasoline fate.....at least for a few more years.

    Thirty years ago, in an odd time in my life, I drove a bread truck. The entire fleet ran on propane. The only hitch was when a driver lit a cigarette and burned up the fueling station.

    You can run cars on CNG with minor redesigns. It's not like batteries where you have to double world production of lead, nickel, lithium, and cobalt just to make enough batteries for American car makers.

    I don't think we really have enough CNG for this to work on a very large scale (or, if production turns out as some folks think, on a even small scale). Using CHG for cars is likely to send the price of NG way up, much closer to that of the price of gasoline. This will make the price of electricity very high.

    I find it difficult to believe that wind will ever provide base load electricity. For one thing, it would be very difficult to build sufficient storage to even out the power. For another, all of the transmission lines would be difficult to do in any reasonable timeframe.

    A lot depends on production, and on the wind side of things, and solar, and nuclear, and so forth.

    I think it is pretty obvious that gasoline is going to be in short supply soon, and that electricity will be much more expensive in any case.

    There is robustness in a multi-fuel approach for every segment, even if they all get expensive,which they probably will.

    A good smattering of CNG vehicles with some plug-in EVs and of course diesel, gasoline, and even a some E85 would help smooth the peaks of the oscillations we seem destined to see.

    I'll carpool with you this week while the Gulf pipeline is down, you can ride with me next week when the summer AC peak drives up CNG, and we can ride in his plug-in hybrid next winter when the wind blows all the time. It's not necessarily a long-term solution, but cars aren't long-term investments. 5-10 years, max.

    I don't see why equating wind with base-load is strictly necessary, though obviously without baseload effect the value is much less. I think at some point we'll be happy to have ANY power at a reasonable price, and we'll adapt. EVs, thermal-store HVAC, freezers, water pumping, desalination, and probably a host of industrial chiller users could benefit from low-cost electricity at off-peak pricing whenever it came along, and these applications all provide native "storage" as part of their operation. If wind production happen to help at peak, more the better. Solar seems like a better match for summer AC peaking to me.

    There is a need for cheap, low-maintenance storage for wind for sure. Solar too, but less-so.

    Options for wind storage (and possibly for EV usage as well) would include flow batteries, such as the vanadium types in limited use today. Expense is high currently, but it is not completely out of line. For example (per The Energy Blog), a system rated at 100MWh would have an installed cost of about $325 per kWh, or $32.5M for enough storage for about 5 hours of operation of 12x1.5MW wind turbines, or about doubling the installed price. The incremental cost of storage for large systems is approximately $150 per kWh. The lifetime of vanadium cells is still be improved, and there is admittedly quite a ways to go. Still, for $700B you could buy a LOT of wind storage batteries.

    Flywheel storage is also possible, but today it is cost-viable only for short-term peaks (which may still have a lot of value for the gusty nature of a wind farm). $100K for 25kwh is a pretty steep cost...even it can run at 10MW.

    Compressed air could possibly work as well. Coupling a pressurized tower-canister with phase-change salts could potentially flatten the production curve on-site, while utilizing thermal storage for lower pressures (and costs) with better efficiency.

    Innovation is yet possible........unfortunately, we need it NOW!

    Hydro pumped storage, connected via HV DC lines if need be, is proven, cost effective, efficient and VERY practical. Much better than any of the listed alternatives.


    I can think of few worse things to subsidize than CNG conversions for Hummers, Escalades, Armadas, Expeditions, etc.

    The sooner they are scrapped the better, converting them into Natural Gas Guzzlers (perhaps we do NOT have as much NG as Picken's claims) is a simply BAD idea.

    And there are 10,000 better aand more important things to subsidize.


    Unfortunately, those kits already exist -- all the big Chevy, Ford, and Dodge truck engines have conversion kits already. Those for V6s and small V8s don't though. Minivans do still have a societal role...for now, anyway.

    $700B would have paid to replace 50M clunkers with brand new gas sub-compacts, or about 30M Civic GXs. Or a scooter for just about everybody in the country. Who says we don't have the money to change our paradigms overnight?

    How many miles of electric rail conversion would $700B cover?

    Total rail track miles in the USA, roughly 180,000 miles.

    2004 cost $2 million to $2.5 million/mile to electrify. Lets say $3 million/mile.

    180,000 x $3 million/mile = $540 billion for every foot of existing rail.

    I support electrifying the main lines (about 20% that carry 80% of ton-miles) ASAP, and then evaluate the remainder. Most nations have 30% to 60% of rail miles electrified.

    Best Hopes,


    Thanks Alan. Is there anything about trains you DON'T know?

    Maybe the light at the end of the tunnel could be a train (electric, of course)?

    I know people that know a LOT about trains.

    For the price and pace of railroad electrification, I used John Schumann, who also built Sacramento's first Light Rail line fairly innovatively in 1987 (?).

    My major effort so far on TOD


    Best Hopes for Electirc Trains coming out of the Peak Oil Tunnel,


    I have read your proposal more than once. It is the most coherent plan for crash mitigation I have seen. Not that there is really much competition for such.

    Did you weigh in on the discussion of specialized transports, such as mining trucks and so forth? Is it reasonable to have hybrid trains and heavy trucks that seamlessly switch between electric and diesel? What is your take on overhead-tram-style electric dump-trucks?

    Today I understand decelerating trains have dynamic braking. Can this be regenerative braking that back-feeds the power network when going downhill? Would such even make a significant difference in overall efficiency?

    Regenerative braking has little value on long hauls across the Great Plains. Much more value in mountains or urban areas.

    Rule of thumb is that electrification increases energy efficiency by x2.5 in rural flat lines, and x3 in urban or mountainous lines. The delta is regenerative braking.

    Some Soviet electric trolley dump trucks.


    Not widespread in Soviet Union, almost unknown elsewhere.

    Best Hopes,


    Do you ever track battery technologies? For niche applications, where range is limited but utilization is critical, I wonder if Vanadium flow batteries would suffice?

    We could really use a solution for farm tractors as well.

    I oscillate between thinking that a painful but survivable slow collapse may be possible, with a heavy shift to renewables and broad utilization of transition technologies, where Engineering may play an active role, and more hopeless view that it's all going to fall apart and I need to head for the hills and learn to farm and raise sheep while I can.

    How do you navigate this aspect of the impending long crisis?

    How do you navigate this aspect of the impending long crisis?

    I will die one day. Nothing I can do will prevent this.

    What matters is what I do with the days I have between this morning and my last day.

    Best Hopes,


    BTW, ammonia fueled tractors (ammonia from surplus renewable power) are a viable solution for farming.


    There was one energy related comment in last night's debate that surprised me. McCain said he favors ending the ethanol subsidy. I still like Obama's energy policy better, but maybe a little of the old maverick is still there.

    McCain has always been against it. In fact, one of our resident ethanol supporters predicted a few months ago that McCain would lose the election because of his opposition to ethanol.

    I think the candidates' positions on the ethanol issue boil down to that fact.

    I think you meant this reply to go to Consumer's post, not mine.

    But I agree 100%.

    Corn doesn't grow in Arizona, but it sure does in IL.

    I can't seem to edit my post above, but it was meant to be in reply to Consumer's comment.

    That is why McCain will lose Iowa and other Midwest ethanol producing states. Obama has long been an ethanol suporter often appearing to speak at plant openings. It is the reason he won the Iowa caucuses IMO and the reason he is where he is today.

    If Obama wins the Presidency he has ethanol to thank.

    If Obama wins the Presidency he has ethanol to thank.

    The only thing that McCain said in the debate that would make me consider voting for him was his opposition to ethanol subsidies, but like Leanan, my vote (presumably) does not really count.

    Hello Leanan,

    Thxs so very, very much for posting this toplink:

    The 2008/09 Agricultural Season Fertiliser Shortage

    ..Today in Zimbabwe, cows and other livestock are being used as a method of payment for school fees, not only will this further decimate the nation’s breeding herd gene pool but will reduce the availability of cattle manure, a major fertiliser input for smallholder farmers on communal lands. Cattle manure is an integral component of soil fertility management in the communal areas in Zimbabwe.

    ...The 105 combine harvesters, 3,000 tractors, 100,000 ox-drawn ploughs, 20,000 ox-drawn harrows and 45,000 ox-drawn scotch carts, provided by the RBZ as a vote-buying gimmick to gullible farmers before the Presidential elections, WILL NOW JUST RUST AWAY.
    The Zimbabwe Embassy never replied to my email, sent a long time ago, asking them to go to full-on Peak Outreach. :(

    I would have been just thrilled to inform them about Asimov's Foundations for Optimal Overshoot Decline, Earthmarines, Strategic Reserves of bicycles & wheelbarrows, SpiderWebRiding Networks for O-NPK recycling, and the other many biosolar concepts that I have posted on TOD.

    IMO, it could have made a huge Liebscher's Optima difference if it merely achieved the Earthmarine specie protection of their draft animals, plus other wild creatures. A societal Liebig Minimum of Oxen means the Nuahtl Tlameme backpacking scheme plus the extreme stoop labor of stick poke & plant to drastic, non-optimal Undershoot.

    I hope the more developed world can do better when our Thermo/Gene time comes. I have no doubt in my mind that China understands the Strategic Logistic of wheelbarrows, bicycles, and rickshaws, and how this leveraging can help protect the environment:

    1970's photo of massive #'s of wheelbarrow workers
    IMO, Home Depot & Lowes gardening centers being busy will reduce the scale and duration of postPeak machete' moshpits. Have you hugged your bag of NPK today?

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

    Given the election coming up I'd like to petition readers here to participate in a "fantasy president" game. Something along the lines of "If I were president starting in January I would ________________" It would encompass ideas concerning energy of course but could include any idea that could effectively change the course the USA is on. I think it might even be useful to collect such comments in a separate space on TOD so that it becomes an ongoing thread.

    I have thought myself thought about what I would do and I bet others have too. Additionally, you never know what great idea may be lurking out there that has not been expressed out loud or who might be reading TOD that is in a position to project an idea into reality.

    What do you think? Is there any merit in my proposal?

    You might find this of interest.

    Hello Freeman,

    "If I were president starting in January I would ________________"

    ..go to Universal Peak Outreach to quickly turn delusional consumers into thoughtful citizens.

    In the meantime: I would love to see an televised energy Q & A with all four candidates. The probing questions, and follow up rebuttal to each of the candidate's answers would be done by a panel composed of Simmons and other key ASPOites & TopTODers. Too bad it will never happen.

    Imagine JHKunstler giving the closing wrapup speech! :)

    Well, since it's a weekend, and since it's late, and since this is one of Leanan's research topics, I have a question about cholesterol, which I picked up on reading a section from "Good Calories, Bad Calories." One could also argue that we have only begun to see the explosion in heart disease and Type 2 diabetes, as Americans are economically forced to eat more refined simple carbohydrates.

    In any case, it seems that doctors are probably too quick to prescribe statins for patients who have elevated LDL levels, but otherwise have normal blood-work, especially where they are otherwise asymptomatic for heart disease.

    From what I have read, there seems to be some emerging research suggesting that a very good indicator of future heart problems is the Triglyceride/HDL ratio. A value of 3.8 seems to be the dividing line between the two different types of LDL. A value of less than 3.8 is associated with high percentages of the good (Type "A" LDL) and and low percentage of the bad (Type "B" LDL) and vice-versa for above 3.8. Here is a recent paper:


    In any case, this group seems to be well versed on a lot of subjects, any comments?

    P.S. Here is an Amazon review of Dr. Atkins' book by an M.D. who addresses the two different types of LDL:


    I think you start out with the issue...diet. And I don't know that we are forced into unhealthy diets. What is your reasoning or assumption there? The healthcare organization I work for...prescribes change in diet:

    Therapeutic Lifestyle Changes (TLC) diet

    The Therapeutic Lifestyle Changes (TLC) diet is a way to eat that lowers cholesterol. It is low in saturated fat and cholesterol, which can reduce blood cholesterol levels and lower the risk of heart problems.

    The TLC diet calls for:

    Less than 7% of daily calories from saturated fat.
    No more than 200 mg of dietary cholesterol a day.
    25% to 35% of daily calories from fat, mainly from unsaturated fat. Most of the fat should be monounsaturated, and only 10% should be polyunsaturated fat.
    Only 2,400 mg of sodium a day.
    Just enough calories to maintain a healthy weight and avoid weight gain.

    The TLC diet is part of the Therapeutic Lifestyle Changes program, which aims to lower cholesterol through diet, exercise, weight loss if needed, and other changes, such as quitting smoking. It is recommended by the National Cholesterol Education Program of the U.S. National Institutes of Health.

    Just a heads up on Dr. Atkins....he died of a heart attack, ironic isnt it? He was obese and had numerous heart ailments which most experts agree were diet related.


    The absence of the only heart ailment I noted in his medical records was, MVP or Mitral valve prolapse, typical in athletic persons.

    That article says the opposite. That he did not die of a heart attack, and was not obese.

    correct. it's actually a urban myth that he died obese and from a heart attack. he actually had a nasty fall after slipping on some ice.

    Err.. last time I looked, he died after smacking his head on a kerbstone.

    Though I have no doubt that CCPO and similar will state that he died because he believed in a meat eating, non AGW diet .

    I'm not embarrassed by your childishness.

    Excerpt of a review of "Good Calories, Bad Calories" by Gary Taubes:


    By Timothy D. Lundeen

    This book is an impressive review of the science and the politics behind our ideas about good nutrition and healthy diets. Taubes took 5 years to write this, and says it wouldn't have been possible without the ready access to original resources that the Internet makes possible. It does indeed have an incredible amount of information about the subject.

    One of the sad and infuriating themes of this book is that much of the currently accepted wisdom about healthy diets has a political basis, that recommendations were made and marketed before the science was solid, or in many cases before the science was even done. The people pushing their ideas strongly believed that they were doing the right thing, that their recommendations would save lives and wouldn't hurt anyone. Unfortunately, as the science gets better and better, it looks like they were wrong -- they may have helped a small percentage of people, but at the expense of greatly increased risk of diabetes, heart attacks, strokes, and cancer for large numbers of us.

    Taubes opens his book by reminding us of the "diseases of Western civilization", that diabetes, high blood pressure, heart attacks, and cancer were relatively unknown in the third world until they adopted a more Western diet. Albert Schweitzer didn't treat many cases with these problems when he started practicing in Africa, but at the end of his service was seeing a lot of them, as local diets changed during his practice.

    One hypothesis for why a typical Western diet is so unhealthy is that we eat a high level of refined carbohydrates: sugars, white flour, polished white rice. Taubes does an excellent job of supporting this hypothesis.

    The basic model is that refined carbohydrates are absorbed very quickly by the gut and result in large blood sugar (glucose) spikes that require large insulin surges to keep blood sugar in a healthy range. Over time, many people develop metabolic problems and are not able to cope with these repeated glucose surges and keep their blood sugar under control. As average blood sugar and insulin level levels go up, they cause a cascade of increasing metabolic problems, leading to higher weight or obesity, diabetes, high blood pressure, inflamation, and increased risk of heart attack, stroke, cancer, and dementia.

    BTW, Discover Magazine has a great article on the side effects of statins, and some other drugs, and how on how drug trials are conducted. It turns out that if someone drops out of a drug trial because of complications (e.g. temporary amnesia), they are dropped from the study, and listed as noncompliant, i.e., they don't exist. Thus, the statistics on complications tend to be skewed, so once the drug is released to the general population, complications are frequently far more widespread than what the studies indicated.

    Wonder Drugs That Can Kill

    John Abramson, a clinical instructor at Harvard Medical School and author of Overdo$ed America: The Broken Promise of American Medicine, says he grew concerned when he learned that the authors of professional guidelines recommending an expanded use of statins had ties to the drugs’ manufacturers. So, Abramson, a tall, dark-haired man with owlish glasses, decided to review the study data. What he found stunned him. Statins could reduce heart attacks and strokes—but only in a small fraction of the people taking the drugs. “Doctors give statins in one of two ways,” Abramson explains. “The first way is to give the drugs to people with elevated cholesterol as primary prevention—to prevent a heart attack, stroke, or other serious cardiovascular event. [These are] people who have never suffered any of those events. The other way to give statins is as secondary prevention, after people have had one of those events or develop diabetes.”

    Despite broad recommendations in the National Cholesterol Education Program guidelines, Abramson found that there were no studies that showed statins were beneficial for primary prevention for women of any age or men over 65. Yet more than three-quarters of people taking statins take them for primary prevention—meaning that many patients stand to gain no benefit at all. Abramson, who with a colleague published his findings in the British medical journal The Lancet, says that even when statins are used for men at the highest risk, “you have to treat about 238 men for one year to prevent one heart attack.”

    Another problem with statin studies, according to Abramson, is that many do not measure clinically and critically important outcomes like heart attacks, serious adverse events, or all-cause mortality. Instead they measure surrogate markers—outcomes that are associated with a risk of disease—but not a bad outcome itself. In the case of statins, the surrogate marker most commonly used is cholesterol levels. If a drug reduces cholesterol, it is said to be “effective.” But lowering cholesterol doesn’t necessarily mean a drug will reduce the bad outcomes people are worried about—such as death or heart attack. This was the issue in last winter’s congressional investigation into the nonstatin cholesterol-lowering drug ezetimibe, sold as Zetia and contained in Vytorin. Hearings in January revealed that the release of negative results of a clinical trial of ezetimibe had been delayed. The drug, while lowering cholesterol effectively, failed to slow the progression of carotid artery plaque. While manufacturers Merck and Schering-Plough delayed the negative study’s release for more than 18 months, ezetimibe had turned into a blockbuster drug, even though it had never been shown to reduce heart attacks or deaths.

    “You can lower cholesterol levels with a drug, yet provide no health benefits whatsoever,” Abramson says. “And dying with a corrected cholesterol level is not a successful outcome in my book.” Suddenly Abramson, who had taken many hits for his critiques of cholesterol-lowering drugs, was joined by physicians calling for more openness in research and more careful examination of the evidence before drugs are put on the market.

    I have followed the Zone guidelines for eating for many years (more or less, because basically, once I started eating that way, I just felt better when compared to not) -- especially daily consumption of pharmaceutical grade fish oil from Dr. Sears' company (expensive but worth it as each batch is tested for mercury and other toxins). My blood work is similar to an athlete's and believe me, I'm no athlete! Although taking fish oil is probably not sustainable for the long term, I prefer it to taking prescription medication. And although Dr. Sears does sell and promote his products for profit, he really is a smart man who has done a lot of research that supports his dietary guidelines. And what I like about it, you can basically read his book, follow his advice and never buy another thing from him and derive maximum benefit. According to him:

    : The TG/HDL is not only a good indication of the LDL particle size but also of the degree of insulin resistance. The stricter you become with the Zone Diet, the further you reduce insulin levels that drive the enzyme in the liver to make more cholesterol. and

    :The TG/HDL ratio: Your best indicator of an impending heart attack By: Dr. Barry Sears Filed: 1/5/98 For more than two years, I have been awaiting the publication of the research first presented at the 1995 American Heart Association meeting by researchers from Harvard Medical School. This research demonstrated significance that the ratio of triglycerides (TG) to HDL cholesterol (HDL) had on predicting the likelihood of developing a heart attack. Published in the December issue of Circulation (Vol 96, pp 2520-2525 [1997]), it was found that the higher the TG/HDL ratio, the greater the risk for heart attack. How much higher? TG/HDL Increased likelihood of heart attack 1.4 1 2.3 4 3.3 6 7.5 16 This is why I have always recommended keeping the TG/HDL under 2, and ideally under 1. The power of the Zone Diet is that it will reduce the TG/HDL dramatically and quickly within weeks. And if I believe Harvard Medical School (which I do from time to time), then this reduction in the TG/HDL ratio will reduce the likelihood of a future heart attack. No drugs required, simply eating the food you like to eat, assuming you are following the Zone principles. This article should go a long way to moving the medical establishment to understand the importance of the Zone Diet for the treatment of cardiovascular disease because the TG/HDL ratio is easily calculated from everyone’s blood chemistry. Of course, if you really want to increase your TG/HDL ratio, just follow a low-fat, high-carbohydrate diet and ignore what Harvard Medical School is trying to tell you. After all, what do they know?

    I consider myself a "recovering vegetarian." For 20 years I was a "vegetarian." I can't even remember why I read the Zone, but I tried it and felt so much better eating some protein at each meal and for snacks. Even now I don't eat a lot of meat, I only eat fish/chicken a few times a week plus eggs, cottage cheese, whey powder and yogurt. I haven't eaten any red meat for 30 years. But I do eat a lot of vegetables. I'll steam a great big batch and have it with my eggs for breakfast.

    My bloodwork is always good (TG/HDL ratio is 1)and I'm still within a few pounds of the day I got married and never "diet" per se. The hardest thing for me was to get in the habit of eating breakfast within an hour of waking. I'm not much of a morning person, but I feel so much better having consistent blood sugar levels all day long. What I also like about the Zone is that it's possible to do while traveling and even at fast food restaurants in a pinch.

    I know that Dr. Sears has worked with several olympic athletes and isn't he working with that guy in Mexico who was the world's largest man? I think he's lost a few hundred pounds so far.

    As the box on the upper right hand part of the page occasionally shows. this quote from mark twain fits the bill.

    "it's not what we don't know that will hurt us. it's what we know that just ain't so."

    West Texas, I appreciate your export oil model and I am surprised Hirsch hadn't heard of it (saw him speak at Duke two years ago).
    As for cholesterol: it is one of the worst medical fables ever foisted apon the american public. Your body will produce it if you don't consume enough. There is a genetic factor that is manifest. Did you know that statin users have lower heart attacks but the death rate stays the same? They die of other causes! What many don't know is cholesterol is the basis of many of the hormones we produce in the body. If you reduce them you screw with your hormonal balance and that can be deadly. The reality is that it is extremely weakly correlated to health and as a matter of fact some of the longest living humans have HIGH cholesterol!
    The gold standard of life extension is calorie restriction: Bacteria to humans live longer if calories are restricted by approximately 30% reduction. Also it had been shown that insulin spikes from sugar are deletirious for health. The Protein Diet shows that by balancing protein, fat and carbos to 33% each restricts insulin spikes. Forget cholesterol as a measure of health.
    See books by Barry Sears The Zone Diet:

    Dr. Hirsch had heard of our export work, but he had never really drilled down into the export math, e.g., case histories of devastating accelerating net export decline rates.

    In regard to cholesterol, this is my favorite quote from the Discover article:

    “You can lower cholesterol levels with a drug, yet provide no health benefits whatsoever,” Abramson says. “And dying with a corrected cholesterol level is not a successful outcome in my book.”

    the healthcare facility I work at is in what passes for our "inner city". Very many folk we treat are obese. They also have limited income. Vegetables are expensive in comparison to refined carbs. Healthy fat is also expensive. Having had a very low income myself for a few years I know first-hand how difficult it is to ensure a good, balanced diet in such conditions. I also had a degree, some education in nutrition and internal motivation toward such a goal. If conditions had been socially chaotic and food had been in short supply at that time life would have been very hard.

    I think that with FF shortage we will see both a price rise and a lessening of availability of produce and imports.(even imports from other areas of the country) I fear that many may have to rely on hightly processed carbs if conditions become dire. White flour does keep longer than whole wheat, and pasta is filling.

    The book I made reference to earlier on posting "A New Green History of the World - Clive Ponting" discusses the hardships of agricultural societies in times of scarcity. It is a very sobering read.

    I think discussion of HDL/LDL ratios and other issues won't have the same immediacy when basic calories are in short supply. I really hope that things don't get that bad.



    Gordon Brown warns short-selling ban may become permanent

    Mr Brown defended the ban, saying "when a group of people are exploiting a difficult economic situation, it is right to stop it."

    The FSA said the ban would be in place until January when permanent new rules on shorting would be formulated. Mr Brown said: "I think you'll find new rules come in for the future...We have very unusual and volatile financial markets . It would be wrong for good companies to be brought down by speculators."

    Not surprising. Killing the messenger has been the modus operandi of the British civil service ever since Tony Blair took over, and Brown is cut of the same cloth. (See British blogs on the police, medical and school services to view the extent of the problem.)

    Pipeline Damage as Bad as Katrina

    from casual conversation in New Orleans from shift supervisor for Chevron production platform.

    "It will takes months to fix them all, they are still trying to define the problem exactly. Some repairs are underway".


    This was just one platform though, wasn't it? Doesn't mean it's that bad for all of them.

    Im curious. Ive now seen two Drum beats in a week with news from the Newnan Times-Herald. Todays article included my own town (Senoia) in Georgia. How do articles get posted on the drum beat and is there someone else in the Coweta county area or Senoia area that is a regular TOD reader/contributor?

    In any case it would appear that the gas shortages in the Atlanta area are easing ever so slightly. But I noticed that shortages made a very significant impact on habits - friends and family around here cut back to only the more essential trips because they cant stand the thought of being stuck or battling long lines and extensive searches for fuel. Thats odd because given the choice between "gouging" (I assume thats what the media would call it if fuel was $6/gal) and shortages the public seems to have chosen its poison - shortages. If gas hits $6/gal and I cut out my non essential driving - im still paying more out of pocket than if gas stays around $4/gal and there are shortages (kind of like rolling blackouts for the fuel industry). In both cases I cut out my non essential driving, but in the case of shortages/rationing the price stays lower so I can still get to work but it costs me less.

    Perhaps unconciously the public/government/media seems to choose rationing over price increases for things they consider important to their lives - at least in times of emergency. Thats a little ironic when I think back to the collapse of the Soviet Union and all the grandstanding about Capitalism triumphing over Communism, the efficiency of markets etc... Sitting in line for hours to buy gas, being limited to 10 gallons or less. Not so different from the old soviet era bread lines? We mocked the Soviets then, but now when faced with similar choices we choose long lines, and rationing over much higher prices...

    Some DrumBeat articles are submitted by readers, but most I find on my own, using Google News, Yahoo, etc.

    I imagine your town is in the news because, well, there's news there. :-)

    As some others have pointed out, unlike higher prices, gas shortages do not encourage people to use more fuel efficient vehicles. The more fuel efficient vehicles usually have smaller gas tanks, so you can't go any further on a fill-up, and in some cases you can't go as far.

    The FKN Newz
    Deek Jackson

    The American Dream, Death By Debt And Delusion
    Profanity warning...


    Shop for your lives, and die in debt!


    Democratic House Speaker Nancy Pelosi said "great progress" had been made - but details remain to be worked out.

    hmmm.....I always thought the devil was in the detail!

    Another thing. I wonder what would happen if a referendum was held on this? Don't be silly me...the power was never in the peoples hands :-(


    The exact allocation of the bribes campaign contributions still needs to be finalized. Details, details. . .