Drumbeat: February 23, 2010

Shale Drilling Moves North, Upending Canada Gas Forecasts

An unconventional drilling technique that sparked a boom in U.S. gas production has made its way north.

Companies in Canada, the world's fourth-largest natural gas producer, are turning their attention to gas trapped in shale rock. In the U.S., the emergence of horizontal drilling and high-pressure liquid injections into these formations helped fuel the boom in gas supplies and subsequent bust in prices.

The rise of shale gas in Canada further blurs an already uncertain outlook for the natural gas supply-and-demand balance in North America, leading some companies to seek a way out of a market that historically has been self-contained. It also represents a stark reversal of previous forecasts, some of which predicted that the decline in Canada's conventional gas supplies would force it to become a net importer of gas by 2030.

Oil Search Warns on Possible LNG Glut

Australian energy producer Oil Search Ltd is warning of a possible glut of liquefied natural gas (LNG) in coming years when several large projects come online.

Aramco adds gas muscle

State oil company Saudi Aramco has brought online the expanded Juaymah and Hawiyah gas plants, sources close to the project said.

Aramco is focusing on meeting domestic gas demand after completing last year a crude expansion project to boost output capacity to 12.5 million barrels per day. Gas demand in the kingdom is growing annually by 7% as oil revenues fuel economic expansion.

Aramco aims to raise gas supplies 30% to 8 billion cubic feet per day in five years.

Saudi announces major gas find

Saudi Arabia on Tuesday reported a commercially-viable natural gas field in its northern Jalamid area. Tests showed the Jalamid-3 discovery well in Al-Sannara reservoir flowing at 12.1 million cubic feet per day.

The well was drilled to a total depth of 2,986 meters, the official SPA news agency, said citing Petroleum and Mining Minister Ali al-Naimi. 'This well can produce greater quantities under normal production conditions,' Naimi added.

Al Khaleej Phase 2 comes on stream

Qatar Petroleum and ExxonMobil said today the Al Khaleej Gas-Phase 2 (AKG-2) project started up with 1.25 billion cubic feet per day of sales gas capacity aimed at meeting demand from local industry.

Total pledges no French refinery closures

Total has pledged not to close or sell any French refineries other than its Dunkirk plant for five years, clearing the way to end a week-long strike that has embarrassed the government ahead of key March regional elections.

Noble, Pemex Discuss Rig-Contract Renewal in Mexico

(Bloomberg) -- Noble Corp., the largest supplier of jack-up rigs in Mexico, is in talks with Petroleos Mexicanos to renew rig contracts that expire this year, Chief Executive Officer David Williams said.

The company has 13 of its 62 rigs -- 12 jack-ups and one deepwater rig -- leased to the Mexican state-owned oil company known as Pemex, Williams said. “Pemex has a need for them, whether or not the rig availability matches their timing, that’s up to them to decide,” he told reporters in Dubai today.

Nigeria says Total to invest $20 bln in gas, deepwater

ABUJA/PARIS (Reuters) - Total and its partners will invest $20 billion in deepwater oil and gas exploration in Nigeria over the next four to five years, the country's acting president and the French firm said on Tuesday.

Anadarko Starts New Well at Potential ‘Mega Project’ in Brazil

(Bloomberg) -- Anadarko Petroleum Corp., the second-largest U.S. natural-gas producer, said it started an exploration well in Brazil that may become the company’s next “mega project.”

Nigeria stablity depends on 2011 poll planning - U.S.

WASHINGTON (Reuters) - The United States pressed Nigeria's caretaker president on Tuesday to revamp the oil giant's tattered election machinery, saying it must hold credible polls in 2011 or risk increased instability.

U.S. Assistant Secretary of State Johnnie Carson said acting President Goodluck Jonathan, who stepped in this month to fill the power vacuum left by President Umaru Yar'Adua's near three-month absence in a Saudi hospital, was making a good start but that Africa's largest oil producer remained in dangerous political territory.

Power barges seen as solution to Mindanao energy crisis

MANILA, Philippines — Using power barges is the “only viable solution so far” to the energy crisis in Mindanao caused by a dry spell spawned by El Niño, one of the co-chairs of the Joint Congressional Power Commission (JCPC) said Monday.

Eastern Europe Looks to Neighbors to Break Russia’s Energy Grip

BUDAPEST — With the European Union’s Nabucco natural gas pipeline facing new delays and Russia’s South Stream project still under negotiation, the countries of Eastern Europe are turning more to one another in search of quicker — and less expensive — ways to secure a reliable supply of gas.

At stake for these countries is energy security and diversification, issues that will dominate a summit meeting Wednesday in Budapest of the Polish, Czech, Slovak and Hungarian leaders, collectively known as the Visegrad Four.

Central Asia’s Energy Wars

Since the winter energy crisis two years ago, when freezing temperatures lasted for several weeks, cooperation dynamics within Central Asia have witnessed rapid change. Upstream Kyrgyzstan and Tajikistan, which rely on electricity imports during winter, were hit particularly badly as they were unable to supply the population with enough electricity and gas. Consequently, Tajikistan was forced to declare a humanitarian crisis.

The crisis revealed the poor management of energy resources on the part of Central Asian governments and their failure to build effective regional energy cooperation. To make matters worse, last December, Uzbekistan left the regional electricity network that linked all the Central Asian states (EDM, December 3, 2009). Tashkent’s decision affected Dushanbe’s ability to transmit its own electricity through Uzbek territory. While the regional electricity network was built during the Soviet period, Uzbekistan was able to leave the regional system by constructing its own energy plants.

US Lawmakers: Reveal Names of Iran Sanctions Act Violators

U.S. Secretary of State Hillary Clinton should reveal the names of companies with "problematic" business dealings with Iran and sanction them, 30 lawmakers urged her in a letter released Monday.

Hiring Freezes Hamper Weatherization Plan

WASHINGTON — President Obama’s plan to create jobs and rein in energy costs through a steep increase in funds for weatherization of low-income homes has so far borne little fruit, with many of the biggest states meeting less than 2 percent of their goals to date, the Department of Energy’s inspector general said in a report issued Tuesday.

The inspector general, Gregory H. Friedman, called the lack of progress “alarming.” Far into the nation’s winter heating season, the program for the most part has neither saved energy nor put people to work, he wrote.

Feds holds geothermal lease sale for Utah, Idaho

SALT LAKE CITY (AP) - The federal government planned to hold a lease sale Tuesday for public lands suitable for geothermal development.

The Bureau of Land Management in Salt Lake City was to auction 17 parcels in Utah and 10 in Idaho.

Nuclear power is too risky

Palo Alto, California (CNN) -- If our nation wants to reduce global warming, air pollution and energy instability, we should invest only in the best energy options. Nuclear energy isn't one of them.

Every dollar spent on nuclear is one less dollar spent on clean renewable energy and one more dollar spent on making the world a comparatively dirtier and a more dangerous place, because nuclear power and nuclear weapons go hand in hand.

Playing with nuclear fire

The current debate over the unexplainable and apparently unfixable leak at the Vermont Yankee nuclear power plant about whether or not the radioactive tritium in the leak constitutes a threat to the environment, with no mention of what it says about the condition of the plant itself, would be laughable if it were not so serious.

Would anyone fly on an airplane that had an unexplained and unfixable leak, even if the leak did not harm the environment, especially if the plane was at the end of its designed life span and had a history of broken parts and mishaps?

Would anyone think of trying to use it for another 20 years? And as a final absurdity, would any one think of flying it 20 percent faster than it was designed for when it was new?

Power Trip: From Oil Wells to Solar Cells

In her first book, journalist Amanda Little breaks the mold of clean energy book by talking to big oil, NASCAR fans, doctors and clean energy pioneers.

Edward Burtynsky takes aim at bigger picture

Q: In the past, your work with heavy industry hasn't necessarily been topical – railways, mining, ship-breaking all operate at an astonishing scale but aren't necessarily front-of-mind issues. With oil, and now water, you've turned to some real hot-button subjects.

A: I think, as I'm progressing through this train of thought, which started 30 years ago, the next logical step for me as an artist – this is where it was pointing to. Mining, resource extraction – those are big issues. I think when we're engaged with transforming a landscape for our own use, it always raises a lot of questions because of the scale at which we engage.

But here, with the water issue, the difference is that there's a water crisis brewing. You can talk about climate change or peak oil; either one of these can bring on seismic changes in our society. But water has the most potential for dramatic, immediate impact. For instance, when water's not there, there's not a lot of time. Within days, cities collapse, society starts to unravel.

The Green in the Machine

A long shelf of new books has been coming into print with the goal of helping general audiences make sense of what’s happening. Nearly every one of these offerings sees global climate change as a dark cloud on the horizon that will stress societies and ecosystems and cause general mayhem. Compared with a decade ago, a surprisingly large number see climate change as a challenge so great that it will force humans to rethink their relationship with nature and to redesign industrial society so it leaves a much-smaller footprint on the planet.

U.S. driving decline is in reverse

The historic drop in driving that began in 2007 and the dramatic decline in gridlock that accompanied it have ended, according to a report today by a firm that tracks congestion in the USA.

Using 12-month averages, the study found that driving increased by 0.3% in September, 0.2% in October, 0.3% in November and 0.2% in December over the same periods a year earlier, according to federal data.

Oil Falls for First Time in Six Days on Dollar, Supply Outlook

(Bloomberg) -- Crude oil fell for the first time in six days as the dollar strengthened and a workers’ union at Total SA said it expects to settle a dispute with the company that has halted some refineries in France.

U.S. crude supplies probably grew for a fourth week and gasoline inventories may have risen from their highest in almost two years, according to a Bloomberg News survey of analysts before tomorrow’s Energy Department report. A union representing Total SA workers said some of the company’s French refineries have been halted by a strike. An official for the union said he was confident the dispute would be resolved today.

Latin America backs Argentina as Britain begins Falklands oil quest

Argentina cemented a Latin American front over the Falklands yesterday as a British oil rig began drilling in the disputed seas around the islands.

Regional leaders at the Rio Group summit in Mexico were expected to sign up for a resolution backing Argentina in its escalating row with Britain after Brazil and Chile pledged their support.

Venezuela’s vociferous President, Hugo Chávez, set the tone of the summit, offering military support. Characterising Britain as an imperialist relic, Mr Chávez demanded the return of "Las Malvinas", as they are known to Argentinians.

CNPC, Sinopec push up oil prices to cut stockpiles - report

China National Petroleum Corp (CNPC) and China Petroleum & Chemical Corporation (Sinopec), the country's leading oil and gas producers, began to heat up wholesale prices of refined oil following the rebound of crude oil prices in the international marketplace.

Between Feb. 20 and Feb. 22, wholesale prices of diesel and gasoline rose more than 100 yuan ($14.64) per ton, the National Business Daily reported Monday.

Market analysts said price hikes by the two companies will trigger panic buying, which will help reduce stockpiles and sales losses for the two companies.

Total Meets Unions to End French Refinery Strike

(Bloomberg) -- Total SA is meeting with unions in Paris today to resolve a strike at its French refineries that threatens nationwide fuel shortages.

“We want answers on the future of Flanders and for the other refineries in France,” Philippe Wullens of the Sud-Chimie labor union said as he entered talks with management at Total headquarters. Wullens later said he wanted a guarantee that Total will keep its other refineries running for five years.

Bulgaria ditches plan to list gas network operator

SOFIA (Reuters) - Bulgaria has ditched plans to float part of its gas network operator on the market, an energy minister said on Tuesday, which media reports said was to prevent Russia gaining more influence over the Balkan country's gas supply.

Nigeria oil reform would worsen bad situation - Shell

ABUJA (Reuters) - Nigeria's proposed oil industry reforms could drive away $50 billion in investment if passed in their current form and make a bad situation for the sector even worse, Royal Dutch Shell (RDSa.L) said on Tuesday.

Oil majors say the terms proposed in the Petroleum Industry Bill (PIB) will make it hard for them to develop new resources in deep offshore waters as well as to run current operations.

"The PIB threatens to make a bad situation worse ... If passed in its current form it will take years to correct its mistakes," Shell's Executive Vice President for sub-Saharan Africa, Ann Pickard, told an industry conference in Abuja.

Shell to Seek 800 Million-Euro Offers for LPG Unit

(Bloomberg) -- Royal Dutch Shell Plc, which is seeking to focus on exploration and production, may sell its liquefied petroleum gas distribution unit, four people with knowledge of the plan said.

Iran to issue $1 bln bonds for energy sector-agency

TEHRAN (Reuters) - Iran will issue bonds worth $1 billion in local and hard currency in coming days to help finance development of its energy sector, student news agency ISNA quoted a senior oil official as saying on Tuesday.

How investors can beat the oil crunch

Oil prices passed the $80 a barrel mark this week, but a growing number of analysts are expecting the black stuff to head back into three figure territory, even before the year is out as we head into a major oil crunch.

DNO Seeks Growth Outside Iraq Amid Oil Export Dispute

(Bloomberg) -- DNO International ASA, the first foreign company to pump oil in Iraq since the 1970s, may invest outside the war-torn country as the regional Kurdish authority and Baghdad officials argue over export payments.

“It’s important for us to look for opportunities in other areas, to have a more diversified portfolio,” Chief Executive Officer Helge Eide said in an interview in Oslo. “We’re looking at eastern Africa, northern Africa and the Middle East onshore. That’s where we have been focusing our new venture activity, with Tunisia being the first opportunity.”

Aramco's JV lubricants' plant expansion to cost $1 bln

DUBAI (Reuters) - Saudi Aramco Lubricating Oil Refining Co (Luberef) expects the cost of expanding its Yanbu refinery to be nearly $1 billion, an Aramco executive said on Tuesday.

Halliburton May Grow Alone as Schlumberger, Baker Do Takeovers

(Bloomberg) -- Halliburton Co., the world’s second- largest oilfield-services provider, may focus on growing from within by boosting market share as its top competitors work on completing two of the industry’s biggest takeovers on record.

Houston-based Halliburton is already positioned to compete in the hottest growth areas -- deepwater and U.S. shale-gas projects -- so it doesn’t need to rush to counter deals by Baker Hughes Inc. and Schlumberger Ltd. with a takeover of its own, said Roger Read, an analyst at Natixis Bleichroeder in Houston.

A tale of two countries to give hope to others

What do Oman and Colombia have in common? Sunny weather, nice beaches and friendly people, perhaps. A less obvious connection, though, is vital for oil markets: both are significant non-OPEC producers that have recently reversed their declining production.

US Dep. of Energy: Egypt oil production to drop

The United States Department of Energy predicted a decrease in the production of oil in Egypt, which is not a member of the Organization of Petroleum Exporting Countries (OPEC), according to Bikya Masr

It said in a report published this month that it expects a decrease in the country’s oil production during the monitoring period that runs from 2009 through 2011.

Russia threatens BP Kovykta assets

Russia's Natural Environment Inspectorate, RosPrirodNadzor, has recommended that BP's joint venture in Russia, TNK-BP, be stripped of the giant Kovykta natural gas project in eastern Siberia.

Don't cosy up to Russia, Europe

In the capitals of European democracies, leaders are hailing a new era of co-operation with Russia. Berlin claims a "special relationship" with Moscow and is moving forward on a series of major energy projects with Russian energy giant Gazprom, one of which is led by the former German chancellor Gerhard Schröder,. Italian prime minister Silvio Berlusconi traveled to St Petersburg late last year to join in the celebration of his "great friend" Vladimir Putin's 59th birthday. And in Paris, negotiations are under way for a major arms sale that would allow Russia to acquire one of the most advanced ships in the French navy.

At the same time, democratic dissent inside Russia has been ruthlessly suppressed. On 31 January, the Russian government refused to allow the peaceful assembly of citizens who demonstrated in support of ... the right to free assembly, enshrined in article 31 of the Constitution of the Russian Federation: the right "to gather peacefully and to hold meetings, rallies, demonstrations, marches and pickets".

IAEA heaps pressure on Tehran

In a new report, the International Atomic Energy Agency (IAEA) suggests for the first time that Iran is actively pursuing a nuclear-weapons capability.

Shannon Kile, a senior non-proliferation expert at the Stockholm International Peace Research Institute, discussed the report and the tougher mood at the UN watchdog agency with RFE/RL correspondent Charles Recknagel.

Bloom Box generates buzz, skepticism with 60 Minutes spot

The Bloom Box 60 Minutes segment has sparked interest, and the device has potential to be a game-changer. But the challenge of developing an affordable, reliable fuel cell has been around for a century, experts say.

Leaving the Trash Behind

Even before they board, air travelers throw away trash of all sorts — including paper, plastic and food waste — and airports and airlines recycle only a small portion of it.

An estimated 7.5 million pounds of trash is generated every day. While the Natural Resources Defense Council, an environmental advocacy group, says that 75 percent of that trash is recyclable, it has found that only 20 percent reaches a recycling center.

“It does not make sense to acquire oil from the Middle East or the north slope of Alaska and turn it into a plastic bottle, use it once and throw it away,” said Allen Hershkowitz, a scientist at the council.

All-electric cars mean more EMI

When Ford Motor was developing its Escape hybrid, it would shut off as it left a particular supermarket parking lot in California, says Scott Staley, chief engineer of electric and fuel-cell vehicles.

The cause discovered: a wireless fence to alert the store when shoppers tried to take shopping carts outside the lot.

U.K. Can’t Rely on Market to Transform Energy, Report Says

(Bloomberg) -- Britain can’t rely only on markets alone to develop electricity networks that can support electric cars and decentralized generation or renewable energy, according to a government report released today.

Cash-for-clunkers rebates offered on new appliances

Three dozen states will launch programs in March and April to distribute almost $300 million in rebates to consumers buying energy-efficient appliances.

The federally funded programs, similar to the cash-for-clunkers auto rebate program last year, are intended to improve energy efficiency and stimulate the economy. Rebates differ by state and appliance.

German Solar-Park Aid Cut Less Than Expected in Draft

(Bloomberg) -- German Chancellor Angela Merkel’s government has toned down plans to slash subsidies for solar parks, potentially improving the outlook for companies such as Phoenix Solar AG and Q-Cells SE, draft legislation shows.

Germany plans a cut of 15 percent for solar parks built after July 1, less than the 25 percent the Environment Ministry proposed in January, the unpublished draft dated Feb. 22 shows. Subsidized rates for systems put on conversion sites such as former dumps and army bases will be cut by 11 percent. Rates for rooftop systems will be cut by 16 percent as planned, while farmland converted to take solar systems won’t be subsidized anymore from July 1, according to the draft.

U.S. Offers Solar Project a Crucial Loan Guarantee

The United States Department of Energy offered a $1.37 billion loan guarantee on Monday to a California company planning to build a large-scale solar power plant in the Southern California desert.

Nuclear power's time has come

(CNN) -- For decades, pioneering environmentalist Stewart Brand, the founder and editor of the Whole Earth Catalog, opposed the use of nuclear power. Now he sees it as vital to efforts to combat climate change.

EU will hit renewables targets, says wind agency

The EU will exceed its target to produce 20 per cent of its energy from renewables by 2020, according to new analysis by the European Wind Energy Association (EWEA) released last week.

The report, which assessed all forms of renewable energy, found that 13 of the 27 EU member states are likely to meet their national targets for renewable energy capacity, with a further eight set to exceed their EU imposed goals.

Small family farms in tropics can feed the hungry and preserve biodiversity

Conventional wisdom among many ecologists is that industrial-scale agriculture is the best way to produce lots of food while preserving biodiversity in the world's remaining tropical forests. But two University of Michigan researchers reject that idea and argue that small, family-owned farms may provide a better way to meet both goals.

Make Poverty History: Make Clean Energy Cheap

"If you gave me only one wish for the next 50 years," declared the world's wealthiest man during last week's TED 2010 conference, "I can pick who is president, I can pick a vaccine... or I can pick that [an energy technology] at half the cost with no CO2 emissions gets invented, this is the wish I would pick. This is the one with the greatest impact."

Bill Gates is right. And he is not just talking about the impact on climate change, which does of course present a major threat. He is also talking about one of the most critical global imperatives to make poverty history: making clean energy cheap.

Turf grass not always a 'green' thing, study shows

UC Irvine research finds that the greenhouse gases absorbed by lawn can be more than offset by Earth-unfriendly maintenance practices.

Richard Branson's War On Carbon

If someone other than Richard Branson had announced that he was waging war on the carbon dioxide molecule, it would probably have seemed a bit presumptuous. But we're talking about billionaire Sir Richard Branson, CEO of 360 companies including one that produced the first manned commercial spacecraft. If he's looking into it, it means he sees both a great challenge and a great opportunity.

Branson was in Copenhagen during the climate talks, but unlike many other businessmen who were waiting for their world leaders to take the lead, Branson had already realized what now seems quite obvious: Politicians are not going to offer real solutions--instead, it will be the private sector.

WWF-Canada and Loblaw Are Turning Down the Heat Across Canada

TORONTO, ONTARIO--(Marketwire) - Today, Loblaw corporate and participating franchise stores across the country will turn down store thermostats by three degrees Celsius for WWF-Canada's Sweater Day. The initiative is designed to demonstrate how simple changes in behaviour at work and at home can help save our planet. Loblaw expects to reduce greenhouse gas emissions by about 5.6 tonnes in just one day.

EPA Takes Heat from Coal-state Dems

(AP) Eight Democratic senators from industrial states are challenging the Environmental Protection Agency's authority to regulate pollution blamed for global warming.

E.P.A. Plans to Phase in Regulation of Emissions

WASHINGTON — Facing wide criticism over their recent finding that greenhouse gases endanger the public welfare, top Environmental Protection Agency officials said Monday that any regulation of such gases would be phased in gradually and would not impose expensive new rules on most American businesses.

Alun Anderson: I'd like a big volcanic eruption and an Arctic disaster

I believe we have reached a tipping point with the arctic ice where anything that is politically plausible now will not save the ice. However, we can still reduce the warming on the wider arctic - the arctic lands - so that we have a chance to stop the runaway emissions of methane or at least to slow it down and make it happen over thousands of years instead of hundreds.

But on the arctic ice it's too late. I haven't met a single scientist who thinks there's anything we can do now that can save the sea ice in total. We might get some of it left in the corners of the Canadian islands which will be a very important refuge for the polar bear and other creatures.

Copenhagen: Billions in Aid Seen as Key to Climate Talks Success

The allure of $30 billion in climate aid for poor nations holds the key to helping restore confidence in U.N. talks on fighting global warming and stopping them from unraveling. But there's only months to figure out a way to start deploying the cash, say the world body, negotiators and greens.

Emissions vows not enough to avoid 2 deg C rise: UN

NUSA DUA, Indonesia (Reuters) – Emission cuts pledges made by 60 countries will not be enough to keep the average global temperature rise at 2 degrees Celsius or less, modeling released on Tuesday by the United Nations says.

Scientists say temperatures should be limited to a rise of no more than 2 degrees Celsius (3.6 F) above pre-industrial times if devastating climate change is to be avoided.

Ice shelves disappearing on Antarctic Peninsula

Ice shelves are retreating in the southern section of the Antarctic Peninsula due to climate change. This could result in glacier retreat and sea-level rise if warming continues, threatening coastal communities and low-lying islands worldwide.

Research by the U.S. Geological Survey is the first to document that every ice front in the southern part of the Antarctic Peninsula has been retreating overall from 1947 to 2009, with the most dramatic changes occurring since 1990. The USGS previously documented that the majority of ice fronts on the entire Peninsula have also retreated during the late 20th century and into the early 21st century.

A new publication by the new economy foundation:
21 hours - Why a shorter working week can help us all to flourish in the 21st century

I know folks (workaholics) that just can't do that, the same people that can't stop driving or reduce their consumption. They have to "get 'er done and "use it up" before someone else does (or they die). It's the American way!

They'll love it. They can get two jobs! ;-)

I like the idea of a shorter work week. It was considered as a solution to unemployment during the Great Depression, and Kellogg's actually did it. People loved it so much that many refused to return to a normal work week, no matter how much money they were offered. Some worked the shorter schedule until they retired in the '80s.

I think a shorter work week would make for an easier transition. It would spread what work there is around, instead of having a lot of unemployed, and a lot of massively overworked people. It would give people time start businesses or learn new skills that might be better suited to the new economy (whatever that is). The drop in income wouldn't be so bad if everyone was affected, plus you'd have extra time to do things to save money (grow a garden, sew, cook from scratch).

Of course it would be massively deflationary. And the killer: it would completely uncompetitive with Indians willing to work 6 days a week, 8 hours a day. For that reason, I don't think it's feasible until globalization unwinds a bit more than it has so far.

There is likely to be more of a spectrum of possibilities rather than a rigid standard in the future. It wasn't until the industrial era that the idea of working by a standard schedule took hold. In the future, those who hold down paying jobs that are worked throughout most or all of the daylight hours for most of the days of the week are going to become increasingly exceptional. Those may still be considered the "good" jobs, but fewer and fewer people will have them. It will become increasingly common to divide one's time between several things - some time for wages in the "formal" economy, some time for money under the table and/or barter in the "informal" economy, and some time on DIY expenditure-avoidance work. This is what is going to force the effective cash compensation that people actually bring in closer to global averages (to which they must converge).

At different times I have earned enough money that it paid me to hire out various chores from housecleaning to servicing my car or truck.

But only rarely heve I earned the kind of money that you can avoid paying out when you take a car to a dealer for a tuneup for instance.I have a lot of time invested in learning basic mechanical skills, but I learned them on somebody's payroll.

A three hundred dollar tuneup (the dealer price) usually takes me about an hour to two hours and costs maybe forty dollars out of pocket.Considering that one of those two hours would have been spent dropping off and picking up the car, and that I have no incentive to cheat, the work is done by the book, the actual return to me per hour is well over two hundred dollars of avoided costs.

Knowledge is power at any level.

I once bought a house for twenty thousand dollars less than the normal market price because it needed a few fairly serious repairs, but nothing any good all around guy couldn't handle.Materials and a helper cost me five grand, and I was finished in a month.

There are still enormous opportunities out there for those who CAN do things to actually DO THINGS.

Of course it would be massively deflationary. And the killer: it would completely uncompetitive with Indians willing to work 6 days a week, 8 hours a day. For that reason, I don't think it's feasible until globalization unwinds a bit more than it has so far.

Unfortunately, that sort of unwind seems impossible to imagine without a complete breakdown. Here's something Stuart Staniford posted a couple of days ago (apologies if this has been discussed).

"The current average for manufacturing wages in China is less than $1/hour.... China has a population of 1.3 billion - ten times larger than Japan - and is determinedly trying to bring them all into the twentieth century. Secondly, as the labor cost graph higher up shows, Japanese manufacturing wages, for example, are about 80% of those in the US, while Chinese manufacturing wages are about 3%. It's going to take a very long while, or an unthinkably large correction in exchange rates, for Chinese wages to get anywhere close to those in the US."

Stuart's assessment?

...the entire working class of the United States is screwed.

Stuart may be wrong. Jeff Rubin thinks peak oil will mean the end of globalization, and I think he could as easily be right as Stuart.

However, Stuart's scenario is the one I expect in a BAU scenario - that is, if peak oil turns out to be a non-factor. So, peak oil or no peak oil, we should probably expect a lot more poverty in our future.

If I recall correctly, Rubin believes the wage differential on global shipping ended around $100 barrel oil.

Maersk Shipping has a new class of very fuel efficient # container ships and they report that slower cruising is cutting fuel costs by a third.

So I seriously doubt that $100/barrel concept.

# Very large, so they take advantage of the square/cube savings (hull friction goes up as square, capacity goes up by cube as size increases). New paint reduces fuel cost by ~1% (so $101/barrel :-), very efficient engines and hull design. Low "hotel load" (insulated crew quarters, efficient lights, that sort of thing).

Bunker fuel is low grade and a good match with increased heavy oil production, so bunker prices may not track av fuel, gasoline & diesel.

Add it all up and $100 becomes $150 or a bit more.


A question, Alan. How does fuel consumption break down between ship/rail/truck in moving my new shoes from China to Denver or my bottle of Bordeaux?

Container shipping is more volume than weight constrained. Air freight is weight constrained.

So it is a ratio between labor & volume.

As I said before, I doubt that $100 (or even $150/barrel) will doom international trade.


I'm inclined to agree with you. Silk and spices have been traded since ancient times. I suspect that the decline of the US economy and US dollar, and our consequential incapacity to buy very many more imports, will have more to do with it than anything.

Silk and spices are both lightweight, high-priced luxury items. I have no doubt that trade in such goods will continue, even if it's by camel or canoe.

Silk and spices were oddities. They were so valuable that overland transport was profitable. Overland travel allowed their traders to tell more interesting stories. That's why we remember about the silk and spice trade.

The bulk of ancient international trade was in heavy, low-value goods such as wine, timber, grain, and even stone. These goods were traded even when ships lasted only a single voyage, and took a lot of effort (for their economy) to make. But this was routine, and one shipwreck story is much like another. So this trade did not get into the literature of the times, from which our histories were written.

I'd go much further than Alan. No conceivable energy cost could halt water-borne shipping, even of relatively low value-per-weight goods, provided the goods are there to ship.

The disappearance of a surplus available for trade is a far more likely consequence of extreme energy costs.

Interested in working on the river? [had a good job in the city...]


just covers Illinois River.

Barge transportation is the least expensive way to deliver goods that I know of. Ship Canal from Joliet to Chicago (basically connected the Great Lakes to the Mississippi River) turned Chicago into the major city in the Mid West, mostly from that fact.

I understand that the Erie Canal is still operating. Maybe we will again see the use of livestock along the banks to propel the barges... or not. I still believe that wind electric and solar will be in use for a good long while, and will be the preferred method.

Of course, downstream it is easier. Just guide the thing and let the current move it.


Canals have no apparent current between locks. The surface of the water is level. Guiding a loaded barge down stream on a navigable
river without power wood be difficult in maintaining steerage.

I live on Camp Street in New Orleans.

Before steam boats and railroads, farmers in Kentucky, Ohio, Illinois, etc. had only one way of getting hard money (silver, gold, copper). Load their valuable produce (tobacco, whiskey, wheat, deerskins, etc.) onto a flat boat and go down river to New Orleans, where they would sell their produce and then break up their boat and sell the lumber. They would often drink, whore and gamble before walking home. Abraham Lincoln did this once as a young man.

The French speaking citizens of New Orleans would not allow the uncivilized Americans to live amongst them whilst drinking etc. so they were forced into a camp upriver from town. A camp of tents, lean-tos and crude cabins. Hence my street name :-)

Going downriver without power is quite doable.

Best Hopes,


PS: My cross street is Race Street, which once lead to a horse race track.

It might not be necessary for shipping costs to be the exclusive reason for decline in trade.Rising wages in exporting countries and falling wages in importeing countries will play a large role, as will; changes in govt policies making for a more manufacturing friendly environment in current importing countries such as the US.

And while a five thousand dollar shipping bill for a container full of electronic gear might be trivial in relation to the money involved, it is substantial in relation to furniture or large appliances or textiles.

I believe the bunker oil bill alone comes to close to a million dollars a week for a large container ship under way.

If wood is being shipped to China, made into furniture, and shipped back-which it is- , a modest subsidy for local furniture manufacturers might be a lot cheaper than supporting thier employees on permanent welfare.

OFM, I'm with you on that one, and so is Jeff Rubin, who specifically identified furniture as being probably the first victim of the energy cost of shipping. Just ten miles down the road from where I live (near Vancouver) there are raw logs being loaded onto ships for China, to come back as said furniture. Combine this with less demand for furniture, as we keep our old stuff for longer, and it looks even worse for mass produced overseas stuff.

Canadian governments are already spending hundreds of millions helping timbertowns "adjust" to the less timber trade (i.e. paying welfare), so I think you are spot on in your analysis.

And making furniture does not require huge high tech equipment - it is one of the few things that can still be done efficiently at modest scale, with modest training. Ideal for recently unemployed people or recent school graduates - it's just not sexy, that's all.

Do you have a link to Maresk's new tech? Because all I find checking the news is that they're achieving that 30% reduction by the tried and true approach of slowing down. That would work up to a point, but I don't see how we're going to build speed traps in the middle of the ocean.

Although come to think of it, between GPS/AIS/Whatever that high seas monitoring system is called tracking ship speeds should be a piece of cake. Or perhaps we could install governors. I guess. Seems like arbitrage through more knots/hour could kick in with voluntary restrictions.

What % of shipping cost is fuel, too? Figures I've seen are usually around 50-60%. Author Jeff Rubin says peak oil will shrink trade with Asia | Vancouver, Canada | Straight.com. JR sez 50% at $100/bbl, spent a lot of time attempting to find other figures with little success.

Emma Maersk gets 28.2 feet/gallon !


The engine (uses recycled exhaust)


The exhaust gases of the engine are passed through a steam generator which then powers electrical generators to generate electricity. This creates an electrical output equivalent to about 12% of the main engine power output. Some of this steam is also used directly as shipboard heat...



Thanks, Alan. That's a big puppy. Are we going to retrofit all the current DWT with this oceagoing CHP, though? Cheaper to slap on some of that newfangled paint - or some sails.

is that they're achieving that 30% reduction by the tried and true approach of slowing down. That would work up to a point, but I don't see how we're going to build speed traps in the middle of the ocean.

But, if the vessels ownwers want it to travel slow because fuel costs have become substantial, they would find a way to enforce or incentive it. Perhaps some portion of the cost of fuel consumed would be deducted from crew pay. And that 30% is from maybe a 15% slowdown, go to half speed and the savings can be really large. And then sails could be added..... There are plenty of ways for waterborne freight to respond to high fuel costs, shrinking the business is the least attractive option.

How does fuel consumption break down between ship/rail/truck in moving my new shoes from China to Denver or my bottle of Bordeaux?

I asked myself a similar question a year or two ago: What is the ship/rail/truck fuel breakdown to move a "typical" shipping container from Shanghai to southern Indiana? I came up with the following:

By ship, from Shanghai to Los Angeles: 38%
By train, from Los Angeles to Chicago: 45%
By truck, from Chicago to S. Indiana: 17%

In other words, the Midwest is further from Los Angeles in "fuel distance" than Los Angeles is from Shanghai. That being the case, any deglobalization that may occur as a result of rising fuel prices will be more significant for interior destinations than for coastal destinations. I don't think that's at all surprising based on historical experience.

So it may be cheaper to ship a car from Asia to LA than from Detroit to LA ...

If all else fails, ships can go back to burning coal. Natural gas is another possibility. So is nuclear power for the biggest ships (e.g. it works fine for aircraft carriers).

On my own boat, I'll just continue to use sails.

It works fine enough for Aircraft Carriers, but what are we US Citizens paying for that fuel regimen, and what WOULD we be paying if this system had to stand up to commercial shipping regulations, waste requirements, etc.. as some of these might be getting waived or overlooked for the US Navy. Anyone know?

Having served aboard US Carriers and Subs I can tell you that they exceed anything on the oceans concerning minmizing environmental impact (excluding planes and eventual nuke waste disposal). Even their garbage is weighted so it will sink and it is only dumped in deep water. Sewage is a different matter, but the regulations are very strict. Other contaminated products are stored for proccessing ashore. Nuke subs are the cleanest boats there are excepting, perhaps, sailboats. Commercial vessels are far dirtier. If all of the major commercial shipping was nuclear it would be a plus environmentally, purely from a propulsion standpoint (no emmissions). Of course, this will never happen.

Many ports don't allow nuclear vessels.

Thanks Ghung,

Any idea of the cost?

No numbers, but likely cost prohibitive, like $120/barrel oil. The biggest issue besides cost is regulation. I've been aboard aging ships with conventional plants. Shipping companies don't factor long term maintanence into their costs very much. They focus on short/medium range profits. Even the US Navy decommisions many of their Nuke subs due to maintenance/refueling costs when the cores get used up. I really don't think seagoing commercial nuclear power is a good idea. If/when newer reactor designs become commercially viable (big if) this could change. Since newer propulsion plants (i.e. giant 2-stroke diesels) are the most efficient means to date of moving goods around the planet (except sails maybe), I don't see a push for nukes unless the culture of shipping changes dramatically. Giant fuel cells or gas turbines perhaps, or modern coal systems.

Best hopes for more localized economies.

Even their garbage is weighted so it will sink and it is only dumped in deep water.

Hey Ghung, I have a deep, (no pun intended) respect for all US seamen and I m sure that what you say with respect to minimizing environmental impacts is true. However your comment and the actual policy underscore the fact that the average person still considers the oceans of the world a garbage dump. The old saw, "Out of sight, out of mind", still seems to hold. Some of the most fascinating and fragile environments on this planet are found in the deepest parts of our oceans.

We recently had an oceanographer, Dr. Ken Banks, PH.D., P.E. with the Environmental Protection and Growth Management Department in Broward County give a talk at my dive club regarding the recently discovered deep corals growing a few hundred miles off of the South Florida coast and how they were being affected by ocean acidification, climate change and a rain of human caused detritus. Even a decade ago these fields were almost totally unknown.

I mean no disrespect to the servicemen who sacrifice so much in so many ways for the rest of us but this policy is extremely shortsighted, to put it mildly!

I wish more people could understand the implications of what our so called civilization is doing to our planet ocean.

TRACES: The Trans-Atlantic Coral Ecosystem Study



Fred Magyar
President www.Kayuba.org
Certfied 500 ft. 1978, Sub Sea Oil Saturation diver.

I agree FM. I often thought about these things as I threw the garbage over the fantail. Just following orders. I was making a comparison to commercial shipping. We often came upon miles of trash floating in their wake and would try to chop it up in our screws to make it sink. I hear that Navy sailors are now required to separate their trash to reduce what goes over the side, but space is limited aboard ship. On subs, trash gets compacted into steel cans and ejected through a hole in the bottom of the boat. Every "non-qual" has to do a stint in the garbage room before he can earn his dolphins. I say "he". I heard yesterday that women are going to be serving on subs now. I'm not a sexist, but I'm not sure it's a good idea. A 10 month patrol can be.......frustrating.

There are companies developing small nuclear reactors just for this purpose.



The head of the large Chinese shipping company Cosco suggested in December 2009 that container ships should be powered by nuclear reactors in order to reduce greenhouse gas emissions from shipping. He said that Cosco is in talks with China's nuclear authority to develop nuclear powered freight vessels.

If all else fails, ships can go back to burning coal. Natural gas is another possibility. So is nuclear power for the biggest ships (e.g. it works fine for aircraft carriers).

But how long this conversion will take ?

Hmmm I think one of the key issues with shipping is being missed.


The problem is not the efficiency of the individual ships but demand for the ships vs supply.
If the fleet is in excess of supply then it will be very difficult to operate these ships profitably esp in a high oil price environment.

So on the financial side your looking at the potential for some serious overcapacity in shipping and problems paying the loans much less making a profit. On top of this you are facing rising fuel costs and the need to pass it on as surcharges to even break even.

My opinion is that people will not work for free or at a loss regardless of the efficiency of the system.

Now moving beyond this problem the next problem is no matter how efficient the ships are the bunker fuel available is a product of how much oil is refined and how much resulting bunker fuel product is produced. Ships are not the only customer for these lower grade products others exist. As the total amount of oil being produced declines at some point you have a problem of actually supplying the bunker fuel period.

Efficiency gains do not solve this problem and simply delay when they become serious.

Next the economies of scale are critical in making shipping cheap. At some point you reach a level where you simply don't have enough goods to ship to fill up our large container ships. Probably this is related not too the ships themselves but to expenses in follow on transport costs when one of these ships is unloaded. Arranging for partial unloading at a number of ports to offset secondary transport costs becomes problematic at best. Just in time delivery becomes a serious problem and if you return to large inventories then local manufacturing looks attractive as time factors become a serious issue. Thus economies of scale can quickly loose value with a very small change in conditions.

I don't see the actual efficiency of the ships themselves playing a huge role in the problems that I think will cause unwinding of the global trade as we see it today. It doesn't even make my list of issues except as basically a footnote.

And of course we have not even begun to discuss exactly how people are planning on paying for these mass shipments of goods around the world. Trade imbalances are a serious issue and to date the fact they have been allowed to grow actually underlies the profitability of the whole form of commerce.

The point is that is far from clear that the current form of globalization is even profitable in a balanced trade environment.

Don't go looking at the ancient world to prove that its possible serious trade imbalances have been a problem literally since the stone age. It did not start yesterday and trade is almost always intrinsically unbalanced resulting in eventual default.

However feel free to look at ancient trade routes and their rise and fall and changes the efficiency of a particular route in and of itself seldom played a role in establishment of trade simply restricted the nature of the goods that could be exchanged.
Certainly more efficient forms of transport opened up new routes and expanded the goods traded but the actual trade itself is almost purely financial not driven by how its executed except for the obvious transport costs.

What I'm saying is that trade is very much a financial problem not a physical problem and next that physical transport issues are seldom the controlling factor in trade. They certainly restrict the nature of whats traded and the financial arrangements possible but beyond that is all about money. And last but not least physical issues have not been a huge problem for centuries i.e the ability to trade any good with any region because the physical capability to do so exists has been effectively around forever. So today I'd argue that financial issues are the primary problem.

With that said whats the future of global trade well its tough to say. Obviously needed raw materials will continue to be traded copper is copper and its not available everywhere. Aluminum, oil food etc. Value add goods are more problematic as most factories can be located anywhere that the power supply is stable only labor costs and other external factors drive many of our current trade routes.
As far as whats going to actually happen I don't have a clue and the reason is simple because the current system probably cannot transform smoothly into whats coming next. Prediction is impossible because I don't see survival of BAU. Now thats not to say the future does not leverage our current investments but I think only after full default i.e basically our our existing structure of debt and corporations related to shipping will fail and a new and very different set of entities will emerge. Who they are and how they work simply cannot be predicted. I think anyone that claims they have a crystal ball than can see through this collapse is wrong.

Given the financial issues asserting that a collapse and reorganization won't happen is also in my opinion simply absurd.

Now with all that said assuming that in general transport costs are rising and far more important delivery times are becoming chaotic and unreliable then obviously we will be forced into using more warehousing or sourcing finished goods locally. It makes far more sense to store raw materials that can be used for a variety of finished goods and go towards a localized demand sensitive manufacturing scheme even if this falls into one off craftsman production of the demand is simply to low.
Also of course to counter this micro or postal style shipments of parcels if you will makes sense. Custom made or one off shipments from a central supplier become the norm not the exception.

We simply don't have the learning curve for making goods and services that existed in antiquity how to make stuff is not a problem where to make it is not really a problem its which how and which where makes money. Its a very different problem. And outside of the obvious need to continue to ship a wide range of basic materials but not even knowing the size of the shipments that make sense its tough to know how things will settle out.

Back to copper sure its going to be needed same with aluminum but also as the economy contracts recycling becomes very viable i.e if we shrink significantly most places will have mounds and mounds of the stuff so although its needed supply is often not and issue.

Lets assume for example that Las Vegas is abandoned it can be profitably mined for centuries for metals and other valuable goods.
If one considers large scale abandonment of cities and suburbs then our children will be swimming in durable raw materials.
Even things like wood would be in ample supply and tar from shingles and roads etc etc.

Makes one wonder even more about what actually gets shipped around esp if populations fall and we have war.

This speculation is a bit farther out in the future but not as far as you think already stripping of abandoned buildings esp of copper has had and impact on trade. Thus recycling of our infrastructure back to raw materials should play a big role in future trade.
Indeed the massive oversupply of ships I forsee broken up for raw materials dramatically drops the need for bulk ore carriers and coal carriers as the ships themselves become the source of steel for falling demand perhaps to make new sailing ships. Cannibalism is a serious issue in shipping :)


Do you have your own blog somewhere? You ought to. You write these epic posts, and it's damned near impossible to respond to your massive (for a blog) outpourings.



One post so far "proving" peak oil is well in the past more coming.

Wow! Graphs!

My daughter is teaching an introductory science class, for science majors, in a local public college. The stuff that I have been warning her about finally hit home this week, when she found out that, due to mandated state budget cuts, she may not have the money she needs to do the remainder of the labs for the spring semester.

My advice to her: Propose to the dean that all college employees take a 10% pay cut, with tuition increases being used to fund the remainder of the deficit. I suggested the standard argument: Would you rather take a 10% pay cut or would you rather take a 10% chance at losing your job?

Of course, I have offered my advice on this topic once or twice over the years. . .

The problem with your proposal is that all employees are not equally vulnerable. Tenured professors are pretty confident they won't lose their jobs. So voting for a pay cut may not be in their interest. It's the same with any workplace where layoffs are via seniority. The young workers are the ones at risk; the older workers have little reason to accept a pay cut (especially since they generally expect the younger workers will jump ship for greener pastures as soon as the economy improves).

In this case, it's a community college, and I don't think that they have tenure. But in any case, I would think that the highest paid employees may be the ones most at risk. In a lot of cases, they can hire two (or more) young professors for the cost of one older professor.

That was my analysis in 1989, when I (anticipating layoffs) proposed that I take a 50% pay cut, in exchange for an equity interest in oil deals I generated and sold. I moved myself from the highest paid employee at the company to the lowest paid, and as I expected, shortly thereafter the owner fired 50% of the staff (but not yours truly).

It's a little cold blooded, but it's like the old joke about the two lawyers and an approaching bear. One lawyer pulls his athletic shoes from his gym bag and proceeds to put them on. The other lawyer says "You can't outrun the bear." The first lawyer says, "I don't have to outrun the bear; I just have to outrun you."


I wasn't sure where this belongs...

Anyone with eyes could see this coming years ago. My prediction in 1978 was that labor arbitrtage was certain to come, and would be extremely difficult for American workers. Any time that there are currency differentials, and wage differentials so huge as what we have seen for so many years, where Americans were earning 15 USD/hr, and 'Third world" workers earning 1 USD / week, business was certain to find a way to exploit the difference. I mean, if stock market arbitrage on a few cents differential in different markets could make people millionaires, what could a disparate set up like that do?

So, it should not be a surprise to anyone that this is happening. It is part of what Capitalism is about, exploiting labor... colonialism, captialism, feudalism.

And, since capital has historically controlled newspapers and other organs of publication, they also controlled the spin on what was happening. And, through their 'generous' tithes, they control the churches as well. No one wants to bite the hand that feeds it.

What we are witnessing is one of the occassional historic changes in the history of the world. More than that, we are in the midst of one of the epochal geophysical events of all time. A worldwide die-off of species that has only happened two or three times on anything like the scale we have already seen.

Part of the changes were created by our liberating so much of the carbon dioxide gas into the atmosphere, and part of it is being caused by running out.

The first equation is: use of fire to tame the environment => agriculture => ability to store => escalation of desire to hoard [greed] => creation of power from stored sunlight in the form of wood => desire for more power [greed] => discovery of steam engine => use of coal => desire for more [greed] => discovery of oil / gas as power source => desire for more => "taming of the environment" to accomodate humans => destruction of habitat in mining, buring, growing in unnatural manner => unnatural increase in CO2 gas in our atmosphere => destruction of species, and making the planet less habitible, and a less desireable place to live.

We read in: http://www.independent.co.uk/environment/nature/the-big-question-how-qui...

scientists calculate that we are losing species at a rate of somewhere between 1,000 and 10,000 times higher than the natural "background" rate of extinction. This means that technically we are going through a period of "mass extinction", the sixth that we know about over the hundreds of millions of years of the fossil record. But unlike the previous five mass extinctions, this one is largely caused by the actions of a single species - Homo sapiens.

And the second equation is simpler:

Peak oil, peak gas, peak coal => population exceeds carrying limits of the planet => reduction of population to sustainable.

=> represents a necessary, not optional, flow. It means 'Leads to,' not 'implies.' There is no way to argue about it, there is no way to spin your way out of it. It is not a debate, and it is not a game. There is no reset button. We get only once chance... no replays, no substitutes, and overtime is unthinkable!

I am truly sorry if this makes some people unhappy. It is not my fault. They need to understand the overwhelming importance of what is going on today! One thinks of lemmings.



Lemmings became notoriously famous because of unsubstantiated myths that they commit mass suicide when they migrate. The myth may exist in more variations. In most forms it does not appear to claim a conscious suicide but rather accidental mass death due to various factors. However in popular culture the alleged behavior is usually referred to as "mass suicide" and hence discussed here as "mass suicide myth".

Driven by strong biological urges, some species of lemmings may migrate in large groups when population density becomes too great. Lemmings can and do swim and may choose to cross a body of water in search of a new habitat.[7] This fact and the extremely strong unexplained fluctuations in the population of Norwegian lemmings may have contributed to the development of the myth.


You must be thinking of the Disney version.

"mass suicide myth".

you mean like this one ?


I don't know anywhere where layoffs are by seniority, except maybe the inverse. Companies are trying to get rid of the senior, high-wage people first. You can see it in the auto industry and newspaper buyouts. And those are the union jobs. For the rest of us, being over 50 paints a target on your back.

Happens in airline and some other union shops(depends on contract).

planner -- Never thought the oil patch was so unique but for us it's usually the young ones that go first. It's very obvious on the drilling/service company side. Seniority equates to experience. When the slide started in early '09 the companies, especially the drilling contractors, began to "back slide" employees: you didn't get laid off but were demoted to your last position (along with your old salary...maybe a little less). This way when activity picks up they can slide the experienced folks back up the ladder. In most areas of the oil patch you're not capable of much independent contribution until at least 5 years experience. Some spots it's more like 10 years.

It can look good on paper to lay off a guy making $120,000/yr and replace with a less experienced hand at $70,000/yr. But then the light hand makes a mistake and it costs you $2 million. Or maybe a $650 million drill ship. Don't need too many mistakes to take away all the cost savings and then some. Little mistakes on a drill rig can cost millions of $'s...and an occasional finger/hand...or a life.

It can look good on paper to lay off a guy making $120,000/yr and replace with a less experienced hand at $70,000/yr. But then the light hand makes a mistake and it costs you $2 million.

Yes, my brother had an experience of that sort with a supplier. He worked for an oil company that was buying lots of 3000 horsepower natural gas compressors, and suddenly all of bearings on the new compressors started failing. Eventually they discovered that the problem was the the compressor manufacturer had laid off all the old timers.

Back when the manufacturer had introduced this particular design, the old-timers on the factory floor had looked at the blueprints, said, "Well, that's not going to work!" and had started doing a little pre-finishing on all the bearings before they installed them. They didn't bother telling the design engineers about it.

Then a downturn hit, so they laid off all the old timers. From that point on, all the bearings on all the compressors failed prematurely. It was a very expensive problem for the manufacturer, less so for the oil company because there are penalty clauses in these contracts.

It just occurred to me that my brother retired at the end of the year, and I haven't heard from him since. I think he said something about doing a little consulting for his former employer. He said something about making four times as much money as he did before he retired.

Pity, because I was counting on him to buy a new yacht to go sailing down the West Coast, through the Panama Canal, and off to Europe. My own yacht needs new sails, the engine has problems, and he could afford a much bigger one. With a bigger yacht you need more crew, and my wife and myself are really good crew. Maybe next year.

I floated such an idea with a few fellow faculty at our small college. Take a voluntary 10-15% cut now and hope the administrative branch would follow our lead. It was strongly suggested I keep my suggestion to myself.

We have not yet had a crisis, because our school lives off of federal funds. So maybe we have a little more time left at The Nipple than do institutions that feed mostly from the state's teet. Every piglet for themselves !!!! Last piglet left with a still-dripping nipple wins. Ha-Ha, charade you are.

Most people's underlying premise is that the downturn is temporary.

Other than those I "know" here on TOD I have only come in contact with one other person (and he has been off and on out of the country working on permaculture in communist states) that seems to realize that it's permanently game over for BAU - not if, just when...

Most others seem to sense that something is seriously wrong but if discussing any of these issues they'll always finish up by adding a little note about "when things turn around..." or "it's just a cycle"...

I have noticed though that for many people some of the wind had been taken out of their sails - any mention of a turnaround has a tone of "it will get better, won't it ?"

The trustees at our place asked for faculty input on budget deficit issues and were surprised at attentiveness of faculty to the financial issues of lower-wage staff (I'm sure we all suggested that they fire half the deans) - anyway, I think it's a function the sense of community people have regardless of the status divide (which could very greatly depending on the institution) and the specific cost issue - e.g., I see no reason why my phd entitles me to better health care than anyone else at my school, but I do see why it would justify wage differentials.

...we should probably expect a lot more poverty in our future...

Which would make Stuart correct - not wrong - on the point that "...the entire working class of the United States is screwed." The end of globalization as we know it (keeping in mind that considerable long-distance trade existed long before the fossil-fuel blowout) would leave US workers paying very high prices (compared to what we are now accustomed to) for basics such as clothing, without receiving compensatory wage increases. Or, to put it another way, one might expect China and the USA eventually to come (approximately) to par irrespective of the volume of trade, unless there continues to be some sort of productivity-based reason, or perhaps quality-of-governance reason, for a difference.

Yes, but the mechanism would not be wage arbitrage. And it would not be just the working class affected.

My take on globalization is that the USA had a very good run for most of the 20th century. We had this marvelous continent, filled with resources, mostly to ourselves, and invited in huge numbers of motivated, hard-working, and in some cases creative and talented people, to help us make the most of it. Our isolation between two oceans protected us while the rest of the world was busy tearing itself apart, twice. No wonder we stood on top of the world by mid-century, with a wage differential vastly higher than the global mean.

Well, we had our run, but there was no way it was going to last. The rest of the world - or at least the parts of it that matter - stopped tearing itself apart and got on with rebuilding itself into serious economic competitors. It was thus inevitable, IMHO, that the playing field would start to level. Relative decline for the USA was going to be unavoidable no matter what happened.

I suspect that the consent of the US to the lowering of global trade barriers was not so much the conspiracy of some secret cabal, but rather something we had little choice but to agree to. Once the rest of the world had risen sufficiently, they were knocking on the door, and for a considerable number of practical reasons, the door could not be kept shut.

Thus, I see the convergence toward the global mean of global wages as being one of the really profound megatrends that are shaping our economy, and will continue to do so for the rest of the 21st century. This would happen with or without peak oil.

The fact that energy prices are going to go up will impact shipping to some extent, and it will have some impact on which things are made in which country. However, I suspect that there will be far more trade between countries going on for far longer than most people imagine. Shipping costs just don't loom that large in the equation, at least for most goods. It won't be until wage differentials between high-wage (e.g., the USA) and low-wage (e.g., China) countries have been forced down to a much narrower range that the cost of shipping will start to weigh very significantly in the balance and result in the re-domestication of much manufacturing. By that time, our economy and the purchasing power of most of our consumers will have declined so much that there won't be many manufactured goods they'll be able to afford to buy anyway.

I suspect that the consent of the US to the lowering of global trade barriers was not so much the conspiracy of some secret cabal, but rather something we had little choice but to agree to. Once the rest of the world had risen sufficiently, they were knocking on the door, and for a considerable number of practical reasons, the door could not be kept shut.

I think it's the opposite. We're the ones who needed globalization. We used up our own resources, and started on everyone else's. And we needed access to other countries' markets, to keep the ever-growing pyramid scheme going.

Shipping costs just don't loom that large in the equation, at least for most goods.

I don't think the cost of shipping is going to be the biggest factor. (Though it may be larger than you think. The recent spike did change things. Wal-Mart found local produce more economical than imported. Manufacturing shifted from China to Mexico, at least for heavy items like appliances. Rail boomed, because of the fuel efficiency compared to trucks.)

However, it was something else that happened during the spike that I think is more telling. Countries started hoarding. Oil, food, coal, steel, biofuel, whatever. True scarcity - as opposed to the sort that means widgets cost a few more dollars here than there - is what will end globalization. Especially for essentials like food and oil.

I think it's the opposite. We're the ones who needed globalization. We used up our own resources, and started on everyone else's. And we needed access to other countries' markets, to keep the ever-growing pyramid scheme going.

I'm not at all sure that we have 'used up our own resources' to the extent that we needed globalization that badly. Do you have some data that supports this?

Looking at Russia, which is still one of the most resource rich countries in the world, it is easy to see how the economic state of a country doesn't necessarily correlate with the size of its resource base. I'm not certain that the US cannot have one last big 'blow out' of resource exploitation which would really leave us penniless, resource wise.

I'm not at all sure that we have 'used up our own resources' to the extent that we needed globalization that badly.

I agree ET. My take on the U.S.'s willingness to enter bodly into globalization was the greed of powerful politicians on behalf of corporations to take advantage of cheap labor at the expense of the U.S. middle class. Statistics show the middle class has been losing ground now since about 1970.

Russia is indeed rich in mineral resources and timber. However, it is quite impoverished in one truly essential resource: a benign climate. That's why it was, and is, sparsely populated, and "under-developed."

I'm not at all sure ... we needed globalization.

I agree. Let's look at the basics. First, there wasn't any "we", in the sense of a group intending to carry out a plan. There were a whole lot of individual companies. Each of them came to a point where they could make more green sauce (i.e., profit) by using the low-hanging fruit on some-one else's tree than by climbing further up the tree in their own back yard. No national "we" was needed.

There wasn't any "need", either. It was merely a matter of cents per share.

The drive for a few more cents per share lead to corporate lobbying, and so to the US and other industrialized countries exerting heavy pressure on LDCs to open up to "trade".

(Trade between an industrialized country and an LDC: "Here. You give us your oil; we'll give you vaccines, civil wars and toys for your elite and military. Deal?")

I'm not certain that the US cannot have one last big 'blow out' of resource exploitation

The US does have a large fraction of its original resource base left. It could have a blow-out, but without the profit motive, it would only do so under military necessity.

Eventually, resources elsewhere will deplete to the point that it's more profitable to exploit local deposits. But remember, the rate of exploitation will be limited by the resource quality. Probably there'll be more of a fizzle-out than a blow-out.

Look at oil as an example.

Stuart's commentary includes references to Eric Hoffer's writings. Those comments reminded me of comments from a man who is running for a House seat from NC. From his personal blog called "Christ's War":

The coming battle, he wrote, will be against "The wicked (The Liberal Leftist Socialist Democrats and their beast in the news media)."

"They want to destroy you," he continued. "At what point are you going to realize this is a war to the death. This is a fight that is either the end of US [sic] or the end of them. I say it is the end of them and their evil world."

The magnitude of the frustration and fear which is the result of the ongoing destruction of the American Dream could easily produce much violence. I recently finished reading Bruce Catton's book "The Coming Fury" in which he described the events and passions leading up to the American Civil War, aka, The War Between The States, as we southerners called it.

From the rhetoric of the Tea Party folks, one hears echos of the same sort of passions being unleashed all over again. If there really is no way to bring back those good paying manufacturing jobs once held by those with only a high school education, the middle class could easily turn to one of the loud mouthed rabble rousers, such as a Beck, Linbaugh, Palin or, worse, D'Annunzio in a desperate attempt to regain a footing as their former lives disintegrate around them.

E. Swanson

re: Christ's War

right... because I seem to remember a lot of discussion in the Bible regarding Christ's concern over political affiliation and economic systems in the (non-existant at the time) USA.

As part of the intellectual elite liberal leftist socialist democrat party I will say that these people are morons - even in subjects they are supposed "experts" on...

Wonder how many liberal leftist socialist democrats one has to kill to earn your ticket through the pearly gates...

Here's something for the Christ's War crowd - we have no interest in "destroying" you - we just think you're ridiculous.

Here's something for the Christ's War crowd - we have no interest in "destroying" you - we just think you're ridiculous.

If they even read the book they worship, they would know that the Christ of the Bible only got mad once, and that was when he kicked the bankers out of the temple!

Of course, they ignore that, and concentrate on the 'vengance' of God [Who has a real anger problem, if you ask me, and for no reason since it is all His fault!] and the violent parts. Forget 1 John 4:7&8, and concentrate on John of Ephesus. And then complain about how intollerant they feel Muslims are, and the like.

Strange species, homo sapiens. Wonder if they'll be missed.


Many of the Fundamentalist may be morons, but there's a lot more of "them" than there are of those of us who fall into the category of "elite leftist socialist democrats". Remember that this is the same group which populates our Military. Remember too the Fundamentalist at the Air Force Academy, where non-believers were given "special" treatment with the tacit assent of the officers. They have been taught how to kill and have the weapons to do so, if they so choose.

The last time the US had a "civil" war, both sides claimed to be fighting with God on their side, yet they willfully slaughtered each other with a purpose. There was no disagreement on the supernatural at the time, as there is today. Indeed, the US had only recently experienced a "Great Awakening" as Fundamentalist preachers spread The Word throughout the country. Darwin's findings had just hit the intellectual world and the average man-on-the-street had no clue about Evolution or geology.

I see it all around me living as I do in back woods America. They are being backed into a corner by science and technology and appear to think that they can turn back the clock on all that's been learned which refutes their supernatural world view. The Fundamentalist American is little different than the Taliban as far as their tolerance of opposing world views. I think it would not take much effort to push the Fundamentalist over the edge into a campaign of violent suppression of the rational world view often labeled "liberal". Welcome to the new Dark Ages. Don't like it? Eat lead...

E. Swanson

The South has a long tradition of value of military service, and, this is largely due to the Scotts-Irish traditions of the South. After being on the short end of rights, wealth, and status in the English (British) Empire, the virtue and necessity of force is more respected.

As to God being on both sides of USA civil war, this is not unusual. Most Armies in history believe god is on their side.

As to the current Fundamentalist fevor, there have been multiple waves of this in American History. The current condition is not exceptional.

It is very simple minded to view the Talibans beliefs and actions as the same as fundamentalist Christians. Some of the differences:

1) Execution of people who leave the faith.
2) Execution of people who commit blasphamy.
3) Insisting the courts run by Sharia law/Christian law.
4) etc, etc

Also, references to "Dark Ages" don't help discussion.

Also, if you want to actually persuade people to your point of view, avoiding personal attacks helps a lot.

You apparently have missed the fact that Christianity has a long history of repression of dissenting thinking. Remember the Crusades? The 13th century was a period of massive repression in which the Inquisition was applied to anyone who was thought to be a heretic. Anyone who appeared to be a witch or other sorcerer was likely to be imprisoned, tortured and killed. Burning at the stake was a common way of sending the unfortunate to hell. It's said that if you recanted, they would strangle you before lighting the fire. More recent centuries produced the Spanish conquest of the Americas, with genocidal results. Need we discuss the various flavors of religious wars in Europe? How about the Irish Catholics vs. the Protestants over the past century, where both sides agreed on the fundamental notions of the supernatural but differed on the details?

I forgot to put in the link to the story about Republican candidate Tim D'Annunzio. Read it and tell us exactly what you think he means by "war on liberals".

E. Swanson

Black Dog,

Don't get too hot and bothered. There are no Inquisition denialists around here.

And don't forget that extreme secularists have been equally murderous -- think of the tens of millions who died in the socialist Gulag or the Nazi Holocaust. Socialists, Fascists and Nationalists should occasionally look at the beam in their own eye -- and while Liberals haven't indulged in mass murder, they tend to be selective in their indignation, singling out religion as the source of all evil and its elimination as the key to Psradise on Earth.

Besides, putting Christian fundamentalists on a par with the Taliban damages you own credibility -- this kind of hyperbole will get you nowhere. I's like comparing Obama with Pol Pot or Bush with Mussolini.


I remember the conversation I had with my dad when I told them I was an atheist and would not be going to church anymore(I was 16.)In an effort to change my mind, he said:

"You don't have to take it literally. You don't have to believe all of it..."

I do not think this is a strictly "Canadian" thing: I have a friend who lives in Alabama and is an atheist, to the extent that he gave talks about it in schools. He eventually joined a Baptist Church because he found it difficult in his business life not to have an appropriate answer when asked "So what church do you go to?"

I bring this up because people do not think about the unpleasant aspects of religion: it is about the exclusion of others, social control, and a subtle undercurrent of lying and of not knowing people's actual beliefs and loyalties. It is about fighting the "other" and of convincing them that your choices are better. It is about pastors maintaining their jobs, and, if you're Catholic or Anglican, about your place in what is essentially a multi-national corporation.

And then, when they're not fighting other religions, there is the ever-present danger of schism and fighting each other.

From a survival standpoint, you want to surround yourself with people whose views are similar to your own, and whose reactions in crisis will mirror yours. Peak Oil is a natural event caused by man: the last thing I want to argue about is whether it is a punishment from God.

Simply put: if you are thinking about mitigating Peak Oil, you obviously believe in science over God. Those who believe Adam rode on a Dinosaur are not your people.

And they will know this.

When you went to college, were you in a frat? Would you advise your kids to to join?

For every "exclusion", there is a beneficial "inclusion" for the insider -- some ready common ground, lowered barriers, quickly verified references, open doors, and (perhaps most importantly) a somewhat shared world-view.

Some pick at inconsistent beliefs or behaviors as "hypocrisy", but really the human brain does not require perfect logic, and you can lead a perfectly normal life as an educated technologist who believes in God and evolution, the Constitution and equality, free enterprise and ecological stewardship, big screen TV sports and LED bulbs. The harder times get, the easier it will be to reconcile apparent contradictions, and to believe what is necessary. Logical consistency is not a prerequisite for survival.

"It's life's illusions I recall

I really don't know life at all"


My chief concern about the church as a survival group is that it was not created for this purpose. Churches will take virtually anyone. Their object is to create a large enough mass for political power and social control. Are you more charismatic than L. Ron Hubbard or Jim Jones? You would have to change the minds of a majority of the members, and traverse the politics of the group. I'm sure that you have gotten the glazed looks from family and friends when you try to explain peak oil to them. And yet you believe that a Pastor somewhere is not going to say that "it is God's will" and that "he will provide", etc., and that the duller members of the congregation will be easily swayed? That the local controlling elites will allow a program that may not be in what they see as their interests(this would include you taking control of any part of the church's activities.)

Would the time spent lobbying be put to better use in a group specifically dedicated for the purpose? Would it be less frustrating?

The benefit I see is that in a Peak Oil preparedness group over a Church is that the discussion would be about how much of a reduction in the standard of living is required, and when we have to be ready, rather than "if Jesus would save us" and "if this is all part of the rapture and I don't want to mess up my chances of going to heaven".

I realize that the problem with my thesis is that you don't see an alternative: that there is no non-religious, local, non-governmental, social organization with a scientific bent, with weekly meetings and a hall, childcare, mixers, transportation, and a range of price points. (Churches are masters of customer service within their narrow range.)

Perhaps we should start a Lodge.

And yet...traditionally, a big part of the role of large, organized religions has been to enforce lower consumption. Just about all of them have restrictions on meat-eating or encourage vegetarianism, for example.

Then there's the whole idea of heaven. Marvin Harris compared it to smaller societies, like Indian tribes. The old joke goes, "How do you find the chief?" Answer: "Look for the poorest man in the village." Because leaders in such societies gain the respect of the rest by giving them things. That becomes impossible with really large societies, though; there aren't enough material goods to do that. So the leaders instead promise people great rewards in the afterlife.

I think that's probably a really necessary element, especially in bad times.


No, i did not miss the facts of Christian history. I was reply to a poster who was discussing christians in the United States, in the present.

As of this century, it is safer to be a disident thinker in the USA than in most Islamic lands or in most/all of Africa, or in China.

As to the Irish Catholic/Protestants, I am unaware of either side doing mass executions of free thinkers or academics.

As to the Genocidal effects of Spanish, most of the deaths were due to diseases, which were poorly understood by the Spanish.

The Black death came from policy changes in the Mongul Empire. Do you also rant against the Khans? Do you blame modern Mongolians for the actions of Ghengis Khan? Your rants consist mostly of personal attacks that have little to nothing to do with rural America or the Southern USA.

BTW, why do you think i necessiarily agree with MR. D'Annunzio? And why do you think this one American represents the veiw point of over 100 million Americans?

America is not perfect, but it is better than most of the current world or various empires in History.

blondieBC wrote:

America is not perfect, but it is better than most of the current world or various empires in History.

I think it's important to realize that you are talking about the US as it was in the last century. Back then, it was reasonable to think that the future was rather bright and that the economy might continue to grow into the foreseeable future. Those of us who have considered the limits to growth paradigm tend to agree that this period was the result of a brief economic binge fueled by cheap fossil fuels. As it appears that this boon has reached it's natural limit, that is, Peak Oil is upon us, it's reasonable to think that the notion of an ever brighter future has died. Added to that has been the efforts of US companies to export jobs to low wage nations and the employment situation looks dire for many people. The old undercurrents of human existence on the edge of survival may return along with all the old conflicts.

Remember that after WW I, Germany's industrial capacity was essentially untouched by war as the fighting occurred outside their borders. Yet, only a few years later, the German economy fell victim to unemployment and crushing inflation, brought on by the reparation payments demanded by the Allies. The situation presented a prime opportunity for Hitler and his Nazi Party to legally take over the government and establish his dictatorship. While I can hope that the present economic situation in the US doesn't worsen, I expect that we haven't seen the end of the downturn yet. Thus, there may be a opportunity for some segment of the population to exploit the situation in order to exert their will over the rest of us in ways which have not been seen in the US since the Civil War, but which are all too familiar to the rest of the world. The Tea Party movement is just the tip of the proverbial iceberg, as I see it. The Republican Party's elected representatives have chosen to operate in lock step to prevent Obama's efforts to govern. I can't see the situation ending peacefully...

E. Swanson

Perhaps you can't see the situation ending peacefully because you are so intellectually arrogant that you cannot consider that the republicans blocking OBama's program are the elected representatives of pretty close to half the population, and that the senate was organized as it is by the Founders for the very purpose of PREVENTING too fast change.

There will be elections soon, the Democrats are very likely to lose a three or four Senate seats and probably a dozen or so in the House.

After New Year, the democrats will be a little more open to a little more input and things will start happening.I make no value judgements in particular in regard to OBama's agenda in saying this-for instance I have stated here several times that I am in favor of Euro style single payer health care.

This is the same old same old that has been going on forever.

You are perhaps very young, which is perhaps to be envied, from my pov;or else it appears that you haven't followed national politics very closely for the last few decades.

The Democrats as I see it have made a serious mistake in evaluating the overall situation.They interpreted a rejection of the last few years of Republican leadership as an ENDORSEMENT of thier current agenda.The public wanted change in a very serious way , but not necessarily THE CHANGE that OBama and his crew have offered us.

In short , the Democrats overreached and tried for a little too much change a little too fast and fell short -near the goal line but not ACROSS it.The banker bailout and the arrogance of the Obama administration as evidenced by staffing so many key positions wit gold in sacks former exucitives, the refusal to say where the money has gone, etc , has simply INFURIATED a large part of the public.

I make it a point to stay in close touch with a circle of liberal friends-former coworkers mostly- and quite a few of them are kind of hot under the collar in regard to the current Democratic agenda or policies for various reasons.

O Bama has never paid his dues in the sense of having to really compromise and work with the opposition-his rise was too easy and too fast. A decade or two in the Senate would have done him and the country a lot of good.Then there is the undoubted fact that he inherited an incredible mess which isn't helping him any.

The Republicans saw thier chance and they have siezed it, and will almost certainly reap thier reward in November.

But you can take comfort in the fact that demographics are on your side, and that more than likely the left will prevail over the right in American politics in another decade or so, in many respects such as health care, environmental policy, etc.

I take it that you are a scientifically literate person , thus and realize that in terms of history and nature a decade is but an eyeblink.

Keep your shirt on. ;)


Much wisdom in what you say, and much with which I agree.

Unfortunately, I greatly fear for the USA. The utter dysfunctionality of our government is not just transitory, but systemic. The people at the top of both parties are clearly not up to the job of leading the country into doing the very hard and painful things that need to be done right now to at least prevent the future from being any worse than it really needs to be. I see no signs that this will change under our present constitutional regime.

The fact that a few people in flyover land are grousing a little bit under this "tea party" banner shouldn't really frighten people. What SHOULD frighten them is that the citizenry hasn't opened their eyes and arisen in righteous indignation, waving brooms in their upraised fists, and demanding a massive and thoroughgoing clean-sweep in Washington DC. We need to send the whole lot from BOTH parties packing, and replace them with public-spirited patriots of wisdom, character, and competence - if we can possibly find such. That, unfortunately, has virtually no chance of happening, and that is what is really scary. For that means that what we are very likely to end up with is a regime change (and by that I don't just mean a changeout from one set of Demopulbicans to another set of Demopublicans, but rather a replacement of our constitutional regime with another form of government). This scares me to death, because while it is likely that the new regime will get to work doing some of the hard but necessary things that are being neglected or blocked by the present constitutional regime, the new regime is going to have to be considerably more authoritarian in order to do this. That means all the tyranical baggage that typically comes with authoritarian regimes. Have no illusions, though, if the people of this country don't wake up and get their act together soon, this WILL happen. We have seen this pattern in history over and over and over again. When a regime becomes paralyzed by factional infighting and problems are left to fester, when the debts pile up to the point that they must be rolled over because repayment is impossible, when the military gets increasingly bogged down in more and more unwinnable wars, and when the society distracts itself in an increasingly decadent and degenerate popular culture, then the handwriting is on the wall, and replacement with a new regime is the inevitable outcome.


I am afraid I must agree with you in just about every respect.

Probably the only real difference is that you are thinking more of the longer term , whereas in respect to my last comment, I waas thinking in terms of a couple of elections out.

I do not doubt that the risk of collapse and a revolutuion of some sort is very real , and could easily come about as the result of an energy war, or the failure of the govt to be able to pay entitlement benefits, or any one of numerous other possible causes.

Nothing would suit me better than to see the corporate world's stranglehold on the throat of our society broken, and as far as I am concerned there is , painting with the broadest possible brush, little to choose from in terms of our current two party setup.

IMO you are dead on in nearly all your comments,and offer some of the best reasoned and best seasoned commentary on the site when you write about politics and culture.

If it is not too rude of me, may I ask about your professional background?I have run across only a few people who seem to have such a broad understanding of our society.

My background:

Nothing impressive on paper. Undergraduate studies in science and economics, graduate studies in business and public administration. A career in state and local government and in higher education, nothing high-level. I'm very much of a generalist, always been too interested in too many things to focus enough on one thing and climb to the top of that ladder. Life is too interesting for "career success" anyway!

It's only bad if you make think it's bad, dysfunction and doing nothing is worse.

I don't think people like Pinochet were too bad, everything is relative. Many are taught that these people are terrible because they are authoritarian, fascist, communist, kings, etc. But it does not appear the present system is working. A benevolent dictator isn't "bad", if he fixes things then he has done good. He is only "bad" if he is overthrown and the victors write the history and say he was a tyrant.

I don't think people like Pinochet were too bad

Modern Republican "conservatives" seem to like people who torture (and kill illegally) as long as it is the "conservatives' doing the torturing.


It's only illegal depending on who makes the laws, everything is relative. You may think torture and killing people is wrong but not everyone does. I believe a Hobbesian state of existence is highly likely.

You may think torture and killing people is wrong but not everyone does

I agree.

Case in point, Modern Republican "Conservatives" and Nazis.

Best Hopes for Basic Morality,


Yes, I have an engineering background and may appear arrogant to those who do not understand the basics of science, especially those with a strong belief in the supernatural. Also, I've never been a good salesman, having found shyness to be a curse. One reason I write is to get my thoughts down "on paper" as they used to say.

You appear to be missing my point, that being that the US is faced with two different political philosophies these days. The Republican mantra of less government and more "free markets" left over from the days of Reagan has hardened into a mindset which resists rational challenge. As such, the Repugs appear intent on opposing any efforts to change the system which they left behind after almost 30 years of power, including 20 years holding the Presidency. They can not admit that their philosophy is the foundation of the latest financial disaster for to do so would imply repudiation of all that they have stood for these past decades. In addition, the Repugs have pandered to the Evangelical Movement, tapping into the intensity of many people who hold a fundamentalist world view. The result (as I see it) is similar to the "irreconcilable differences" which lead to marital divorce.

My perspective comes after working on 4 presidential campaigns, as well as a couple of senate and congressional races and California initiatives. The American electorate has voted repeatedly for candidates who were perceived a outsiders and who promised changes in the way government worked. I gave up on presidential politics when Clinton won the nomination. My last feeble efforts were directed against Newt Gingrich in 1998 and I have lately registered as an independent.

The Repugs and their "Government by Gridlock" will prevent the implementation of rational solutions to immediate problems and make it impossible to solve the long term problems, such as the ballooning national debit and funding for SS and Medicare. At the same time, the Rethugs insist on maintaining an overwhelming military machine which costs more than the combined spending for military of the next 10 nations while we continue to fight in 2 wars which their President started. I fail to see how this situation can result in anything but massive pain.

E. Swanson

The long term problems with social security is that it is a ponzi scheme doomed to failure. No one can "fix" social security without making it just another tax, government spending will be forced to decrease because the money won't be there for the military and entitlement programs.

The only solution is to save for your retirement yourself and pay the doctors yourself.

without making it just another tax, government spending

And what is wrong with that ?

Just after the occupation formally ended in Germany after WW II, they started mailing out "social security" checks. Started under Bismark (a wise conservative who saw the need for social programs), the checks went to people who had earned income with gold marks, paper marks (hyper inflation), Riechmarks (under the Nazis) and new German Duetschmarks. In their earning years, they lost two major wars, saw two revolutions, two occupations and one hyperinflation.

Yet they got checks in their later years for their earlier contributions.

As far as paying your own doctors, just be prepared to die instead. A large # of illnesses will require more $ than you can reasonably save if you work for a living.

One is supposed to save for retirement (see IRA, 401k, Roth) but Social Security makes up the difference.

Best Hopes fSocial Security,


Because social security relies on perpetual growth to pay the retirees, it will never work. Welfare for the old is just more generational theft and won't be tolerated in a post peak oil world. I am too young and will not see any money, I do not want to pay into the system but I am forced to pay.

It is not my fault the Baby Boomers did not have enough kids to support such a flawed system, they can eat dog food for all I care.

they can eat dog food for all I care

Compassionate Republican "Conservative" = oxymoron

The society that you espouse is the one most likely to have the maximum # of people eating dogfood, or not eating.

That society is also the one LEAST likely to survive as a functioning, technological society.

Germany, which honored the promise of past governments to it's older citizens, and the other social democracies are MUCH more likely to do quite well post-Peak Oil.

Best Hopes for reflecting on "What would Jesus Do ?"


They're going to be eating dog food because they did not measure the opportunity cost properly of having children to help take care of them. But Social Security, Medicare, and pensions are all going to melt down. They assumed these would be there, the welfare state is going to implode in the U.S. and Europe and there won't be anyone to steal from to fund it. Germany wouldn't have been able to fund those programs unless it was able to grow the economy, I don't see how that will be possible in the future.

I don't know what Jesus would do as I am nonreligious and the universalism of religion does it more harm than good. Jesus probably would have said have more kids or something of that nature. I don't like compassionate conservatism either, that is why I am not a Republican and not a "Conservative", I am a paleoconservative.

they did not measure the opportunity cost properly of having children to help take care of them.

Have you actually calculated the Net Present Value of children ?

VERY high risk (they may grow up to be drug addicts or even ungrateful paleoconservatives, which are of no value what so ever). At any appropriate discount rate, there are *FAR* better investments for one's old age.


When there are multiple children, I have observed that the more liberal siblings do *FAR* more than the conservative ones. A new Willie Nelson song would be appropriate, "Momma, let your children grow up to be bleeding heart liberals".

Growth was *NOT* required for Germany to keep it's promises to the elderly !

At the end of WW II occupation, their economy had shrank DRAMATICALLY. Germany's cities were still rubble (some damaged buildings had been repaired, but that was about it), her industry barely functional, the main source of tax revenue was property taxes on farmland (the most viable part of the struggling economy). All in all, worse than many doomers foresee for many decades.

Basic morality is required though.

And that morality, even in bad times, is a critical component in surviving as a functional society worth living in.

Unlike the hell that you propose and advocate.

Morality does have survival value.

Best Hopes for Basic Morality,


They're going to be eating dog food because they did not measure the opportunity cost properly of having children to help take care of them. But Social Security, Medicare, and pensions are all going to melt down.

Thanks to Social Security, Medicare and pensions old folks don't need to impose on their children.
But you argue backwards, that Social Security having failed(untrue), old people without children will eat dog food, assuming that old persons with children will be supported by them(conjecture).
The reason why SS was passed because in those days old people were not being cared for by their children(reality). Another advantage was that old people would retire making room for younger people to get jobs.


Your addled brain has failed you, paleoconservative.

Since even under normal circumstances, the system will most likely collapse, why should I be forced to pay into it? This program is simply unsustainable, it must be nice for older people to get money, but the program simply does not work.

Back atcha BD,

Actually I rather tend to agree with you, IN BROAD TERMS, except I think you have altogether too much faith in the demorats. You may have noticed that I occasionally remark that a conservative is not the same thing as a republican.(Nor is a liberal necessarily a person in favor of providing a cushy living for women with five or six kids and no husband, or a preson determined to collect all our personal weapons, or sieze all our personal property for the good of the state.)

I tend to see both sides of the political spectrum as being equally guilty of createing the mess we find ourselves in.

My perspective , however is from a different pov-I tend to look at the world, and the people in it, as factions fighting first and foremost for thier own place at the trough.

I suppose that comes of being a Darwinist and a technically educated farmer-mostly scientific ag is just applied biology, like medicine.

As I see it, niether party in this country has dominated;rather all the basic legislation has been passed as a result of fairly crude deal making.Enough democrats support the military industrial complex to keep it alive;and in exchange enough republicans support the welfare state(by which I mean ss, medicare, school aid...)to keep it running.

Now as a realist I submit that niether we nr the countries of westen Europe which are often held up as models would likely not exist in a recognizable form today unless it were for the American military juggernaut.If they had had to pay thier own way on defense they might not look so good in comparison.

( As far as those who think communism was a phoney threat goes, IMO they are so simple and niave that I don't bother talking to them -I regard them as being the intellectual equals of bible thumpers at best.)

Now as far as THAT-meaning our oversized military-goes we would have been much better off to have taken a different strategic and economic path after WWII.

But we didn't.And we CAN'T drop out of the game.We simply are compelled to play the game out with the cards we hold and the chips of the world on the table.

It's a Darwinian world, and it's scary , and we aren't getting out of here alive. ;)

If there are any primates left after we are gone, they will probably evolve complex technology and do it all over again in few tens of millions of years.

"the senate was organized as it is by the Founders for the very purpose of PREVENTING too fast change"

Oh? Suggest you read the Constitution more carefully.

I think he's right. PG makes the case here.

Actually, what record we have of the debate during and after the constitutional convention, and the constitutional structure itself, makes it pretty clear that the Senate was created to prevent change that was going to be excessively favorable to the most populous states and excessively adverse to the least populous states. And the Senate was designed to represent STATES, not so much the people in them. Senators were originally appointed by state legislators, for the purpose of representing their STATES, and particularly their state governments, in Washington. It is called "The United States" because it was designed to be a federation of states. The 17ths amendment upset this balance by having senators directly elected, which set us on the road to having a yet another legislative chamber full of nothing but grandstanding egotists.

Really? Better at democracy than the Greeks? Better at imperial control and assimilation than the Romans? Better in living standards for ordinary citizens than modern western European countries? Really? Sweeping generalizations don't promote thoughtful discussions.

Some might even argue that the nit-pickers, complainers about and critics of American democracy do because they love their country enough to want to hold it to its promise - and surely that promise is worthy of more challenging comparisons than the ones you suggest. Being better than totalitarian regimes does not make us a good country.

My take is that many Americans have their relationship with their country back-asswards. When I spoke out against this current war I got a lot of grief. One woman I know actually said "How can you question the will of your country and it's leaders? You don't love your country!". I asked if she had kids (knowing she did). I asked her if she approved of everything they do and support all of their decisions regardless of how foolish they may be. "Of course not, when they do wrong I let 'em know, whip 'em if they deserve it."
"Do you love your kids?", I asked.

I totally agree with you B_D

I was just talkin' a bit of smack to them...

I harbor no illusions about this situation - I know that I'm just another dead "liberal" if they choose to follow this path...

Who knows though - maybe when the time comes they'll do the Christian thing and forgive us our sins.

Stuart's commentary includes references to Eric Hoffer's writings.

Stuart quotes from "The True Believer: Thoughts on the Nature of Mass Movements". I read the book in the early 60s, about ten years after it was published. I have since read it several times. I quote from it often. In my file of several hundred of my favorite quotations I have about 15 or so from that Book. Below are five of them, picked at random from my collection:

Mass movements can rise and spread without belief in a god, but never without belief in a devil.

It is the true believer's ability to "shut his eyes and stop his ears" to the facts that do not deserve to be either seen or heard which is the source of his unequaled fortitude and constancy. He cannot be frightened by danger nor disheartened by obstacle nor baffled by contradictions because he denies their existence.

The devout are always urged to seek the absolute truth with their hearts and not their minds.

The inability or unwillingness to see things as they are promote both gullibility and charlatanism.

They want freedom from "the fearful burden of free choice," freedom from the arduous responsibility of realizing their ineffectual selves and shouldering the blame for the blemished product. They do not want freedom of conscience, but faith--blind, authoritarian faith.

Eric Hoffer:
The True Believer.

A footnote: Hoffer had no formal education and worked as a longshoreman for most of his working life. He worked as a longshoreman until he retired at age 65. He wrote ten books, all of a philosophical nature.

Ron P.

I like this one:

A man is likely to mind his own business when it is worth minding. When it is not, he takes his mind off his own meaningless affairs by minding other people's business.

, which our vast throng of Big Government busybodies and their enablers would do well to take to heart.

The drop in income wouldn't be so bad if everyone was affected. . .

You don't seem to understand that capitalism is about exploiting labor. It is the labor input that creates value in things. Productivity is way up, but wages are not. Only profits, and of course bonuses.

So, you see, the drop in income will almost certainly not be shared by "everyone." Your fellow laborers, though, will certainly share in that. I just don't see management wanting the masses to have huge amounts of time on their hands. IMHO we are more likely to see higher hours, lower pay, and higher unemployment. Capitalists would prefer if all of the workers were supporting the unemployed memebers of their families. That way they will be 'glad' to get the work, and take whatever minimal wage is magnanimously granted by our lords and masters of the international corporatocracy.


You don't seem to understand that capitalism is about exploiting labor.

Of course it is. And yet...we somehow have labor laws. How did it happen?

Well, most of it happened before globalization. I expect globalization will break down. Maybe not for the reasons Jeff Rubin has put forward, but I don't think it will last forever. As Krugman has pointed out, we've been through this before. A global economy that no one could imagine would ever end...that ended.

And yet...we somehow have labor laws. How did it happen?

For a brief moment, during the deepest part of the depression, a populist President engaged the country, and in reaction to the excesses of the past 20+ years, some labor laws were passed. Since then it has been a steady errosion of what was passed then, until today there is need for renewed legislation. And yet, today, after a clear mandate, our President does not understand that he was elected to LEAD, and all of the wimps in the Democratic Party are so afraid that they will not get their reelection funding money from Corporate American, and the international corporocrats who have stolen our electoral system, and our Supreme Court over the past 28, now 29 years!

Basically, I agree that the American Worker is screwed.


It was more than that. The labor movement started long before the Depression, and labor law as we know it wasn't enacted until long after.

This played a big part in the history of Hawaii. One reason it's such a melting pot is that plantation owners didn't want their workers to organize. They intentionally brought in people from different countries, and housed them separately so they wouldn't learn each other's languages.

It's also the reason statehood was delayed until the 1950s. The wealthy land owners did not want to become subject to US labor law.

and labor law as we know it wasn't enacted until long after.

Labor law has been emasculated, and it has been going on for quite a while. I had the opportunity to represent PATCO members in their little dispute with Ron Reagan back in '82. The fix was in, the union had no chance in that particular skirmish.

And it has been downhill ever since, that battle being the start of the race to the bottom, at least IMHO.


The union membership rate in the U.S. has fallen from 20.1 percent of employed wage and salary workers in 1983 to 12.4 percent in 2008, according to the U.S. Bureau of Labor Statistics' (BLS) latest union members summary, which reports that there are 16.1 million workers belonging to a union in the U.S., down from 17.7 million in 1983.


I don't disagree there. "Peak union" was probably 1967, when the age discrimination act was passed.

What undercut labor was globalization. And I suspect peak oil USA had a big role in that. Yes, cheap labor beckoned overseas. But then, it always did. I suspect cheap energy was even more enticing.

Possibly peak oil USA helped squelch any notion that it would be fun to go it alone. Trade may have its drawbacks but so would going it alone. Yawn.

The underlying trouble is that many of the economic reasons for fantastically high wages for rote jobs in the USA have faded away, and when one gets down to brass tacks, the subject here is very much the pretense that it is otherwise. Plus, oddly enough, and despite a lot of hysterical posturing at the time, planes haven't exactly been falling out of the sky all over the place since air-controller salaries came back down to earth. There was little reason to pay through the nose for a whole raft of rote jobs in the first place, except that amidst roaring growth towards infinity, it had seemed possible at the time. These days, it may not be so possible, so we might be in for some Greek-style temper tantrums - but probably to no lasting avail, not here and not even in Greece.

It will be interesting to see how many ardently supported institutions and programs will turn out to be merely unaffordable luxuries. The siren songs of growth and energy have been seductive indeed. Now we're upon the rocks, and soon the music won't seem quite so enchanting.

Unions, minimum wage, child labor, racial equality, immigration, free trade, equality under the law, police protection, impartial functionaries, empowered women, meritocratic workplaces, property rights, safe travel, available medical care, relative peace -- all (and more) are likely to be sorely tested.

As I keep saying, the 21st century will be one long exercise in giving up things.

I had the opportunity to represent PATCO members in their little dispute with Ron Reagan back in '82.

zaphod42 - I would like to hear more about your experience with the PATCO strike of 81'. It was my understanding that Reagan used the "get tough" posture on the relatively small air traffic controllers union (there were only about 12,000 members at the time) to intimidate other larger unions such as the Postal Workers Union and labor unions in general. I see that headline grabbing event as the beginning of the end for labor in America.


Remarks about Big Business controlling the media and the politicians mirror statements being made in 1910. That was the middle of a 40-year period during which capital managed to extract an increasing share of production. From 1910, however, it took another 20 years for the capitalists, led by the financial sector, to screw things up badly enough that radical reforms happened. And the financial crisis had things to build on. The Roaring 20s were a limited phenomenon; all during the 1920s, a large majority of the rural population in the US was desperately poor.

Just personal opinion, but things aren't ripe yet for radical change, and those expecting the Obama administration and the Dems in Congress to make such changes are bound to be disappointed. As a kid, I sat and listened to my grandparents' stories about the Great Depression. It was different: 25% unemployment and experts predicting that a 45-year-old who lost his job would probably never find work again. Entire towns' savings wiped out completely when the local bank failed. Game wardens who tried to enforce hunting season restrictions going into the woods and simply disappearing. The Communist Party holding meetings in the Great Plains states, and significant numbers of ordinary people attending openly. We are far from that.

I would argue that, as of today, the US has one looming (crisis in the next decade or so) energy problem: petroleum-based transportation fuels. NG, coal and electricity are a problem further down the road. And unfortunately, it's all happening in slow motion. In one sense, a crisis -- an Iranian strike knocking out Saudi Arabia's export capability, say -- might be helpful.

It would spread what work there is around...

Of course, this tempting logic is also known as the lump of labor fallacy - which was rediscovered some years ago when they tried les trente-cinq, the 35-hour law, in France.

Apparently the law had but little effect on unemployment - hence the fallacy - but what it did do was (1) to please some members of the affluent middle class, especially academics, and (2) to make workers at the bottom of the pile angry. The pleased folks were well-fed types happy to have a bit more leisure, especially when their jobs already provided, for example, the sort of travel that could be seen as a perq. The angry workers were the ones who had no perqs and didn't want their paltry weekly wages cut back (it's more economical, even in France, to take on a few extra hours at an overtime rate at the same job, rather than commute to a second job to work those hours at a non-overtime rate.)

AFAIK, the French government has long since backpedaled, softly, softly, oh so softly.

I think it will no longer be fallacy in the post-carbon age. Because then, the economy really will be a zero-sum game.

Of course, most people will go to their graves not understanding why things changed.

Of course, most people will go to their graves not understanding why things changed.

Yeah, but not a single one of them will be a reader of Leanan's Drumbeat. ;)


Merci for your intelligent comment. In fact, it is more likely that the economic crisis will 'incentivise' people to work LONGER hours if they get an opportunity to do so. Indeed, in poorer European countries, such as Greece, it is quite common for people to work two jobs. By way of anecdote, my Greek step brother-in-law has/had a day job as a computer technician plus a part-time weekend / evening job at a vending kiosk. Totals about 60 hours. He would find the idea of working merely 35 hours per week financially suicidal.

Dream on, ye thirty-fivers.

If people have trouble finding one job, good luck finding two.

I've no doubt many will work longer hours, but it may be in what Homer-Dixon and others call the "home economy."

To place a period at the end, HuffPo has this:


No wonder Consumer Confidence was down so today!



Hindery's piece is interesting, but unsatisfying in the end. It is easy to say "What is needed is an all out government effort to create 30 million jobs," those jobs paying, based on his other comments, on the order of $40K per year and up. It is another thing entirely to make specific recommendations that might accomplish something.

If I were to be made Emperor of the US, I can think of several things I would try. Some of them are clearly illegal under WTO treaties to which the US is currently a signatory. Some of them would be unpopular with people running multinational corporations. And some would be unpopular with people as wealthy as, and with the income of, a Leo Hindery.

And whatever those unstated things you would try might be, I suspect that they would not create 30 million jobs paying $40K and up according to any current understanding of what $40K means.

What we might actually be able to AFFORD is a new CCC, where the workers are fed three good meals a day in an Army mess tent, where they are issued Army surplus uniforms, where they sleep on Army cots under an Army tent, where they are seen by Army medical teams, where they are supervised by Army NCOs - and where they are given a few dollars per week that they can send home to their families.

$40K+ per year? Dream on!!

I suspect that for increasing numbers of people, it is going to be one job in the formal economy, and one in the "informal" economy. It is going to be a lot easier to hide the under-the-table money earned if one has a formal economy job with W-2s and tax withholdings to minimize suspicions. A person geting on with no officially documented means of support is bound to eventually attract the attention of the IRS. I'm pretty sure that they are going to go looking for such once the tax revenues dry up enough.

I wouldn't be at all surprised if this is pretty much the game that has already been played in Greece for years and years.

Greece, Italy, Spain, other Mediterranean countries - yes, and it's ancient. Modern Germany with its overbearing ordnung, and Scandinavia, which is just like Germany in that respect except that it's done softly, softly - maybe not so much.

Or what the British call the "informal economy".

it would completely uncompetitive with Indians willing to work 6 days a week, 8 hours a day. For that reason, I don't think it's feasible until globalization unwinds a bit more than it has so far.

The problem is not that Americans aren't willing to work 6 days a week, 8 hours a day. A lot of them are. The real problem is that they are competing against Indians who are willing to work 6 days a week, 8 hours a day, AND ARE BETTER EDUCATED.

The real problem is that India graduates over 2 million English-speaking university graduates per year. They're willing to work relatively cheap by American standards because that's not cheap by Indian standards. For lower salaries than Americans make, they can afford to hire a few servants to do their cooking and cleaning for them.

I didn't say people were unwilling to work. The topic was a shorter workweek, because there won't be enough jobs for everyone. Not because people don't want to work.

The number of jobs is not fixed, it depends on the level of economic activity in a country. If you reduce the work week, the level of economic activity drops, and the number of jobs remains the same while the average weekly income falls.

A shorter workweek doesn't address the underlying problem, which is that American workers are becoming uncompetitive in the global context, given their income expectations compared to their education levels.

Why would a semi-skilled American assembly-line worker expect to make more per hour than an Indian software designer or a Chinese engineer? In the long run, he won't. He'll make something comparable to an Indian or Chinese assembly-line worker.

The number of jobs is not fixed, it depends on the level of economic activity in a country. If you reduce the work week, the level of economic activity drops, and the number of jobs remains the same while the average weekly income falls.

I understand that. I'm saying that peak oil means lower economic activity, whether we like it or not. We need to re-calibrate our work force to match, rather than futilely try to keep growing.

A shorter workweek doesn't address the underlying problem, which is that American workers are becoming uncompetitive in the global context, given their income expectations compared to their education levels.

I don't see that as the underlying problem. Indeed, more Chinese lost jobs than Americans.

The problem is that peak oil means less economic activity. At least of the traditional sort.

I also expect it will mean the end of globalization, so what Indian software makers are willing to work for won't matter.

Rocky...you have a tendency to jump in on threads without reading them. You need to read the entire thread before you respond, not just one comment, or you end up taking things out of context. Arguing against stands no one took, or that have already been addressed.

It's not that I don't read these threads, it's that I have a different perspective on these things than most people. That largely is because I have been to a lot of interesting places that most people will never go, and talked to interesting people they're never likely to meet.

Also, after I have made a post, other people jump in between the original post and my reply, add a lot more conversation, and the whole thread suffers from temporal disassociation. For instance, I make a blanket statement that the number of jobs does not depend on the hours of work, and leave it at that, but someone will jump in ahead of my reply with a more complete explanation, complete with a link to the Wikipedia article on the lump of labour fallacy , which is a pretty good summary of why the concept is economically invalid.

I'm also not interested in discussions of Christian theology or the behavior of lemmings because I don't think they're relevant to the topic. I was trying to make a basic economic point: In the 21st century, your income will depend on your level of education, regardless of where you live in the planet, regardless of Peak Oil.

I disagree with many of the assumptions that people make about the implications of Peak Oil. Peak Oil has little or nothing to do with the economics of something if it can be done over a wideband satellite link or fiber optic cable. Case in point: I have a sailboat docked up the West Coast about a day's sail north of Vancouver. The guy who lives on the boat across the dock has a satellite dish up on a pier and is developing video-on-demand software for a company in China. He doesn't have to be in Beijing because he can work just fine from a boat in a remote British Columbia community that has fewer people than it did before Columbus discovered America. Case 2: Once of my partners in the boat doesn't have time to sail because he is working too hard developing educational software for a company based in India. In both cases, the companies in China and India need expertise, and these people have that expertise. The problem for most people arises if they do not have expertise that is needed in the global context.

While peak oil does mean less economic activity of the traditional sort, it does not mean the end of globalization. It means that global economic activity will increasing be of the non-traditional sort. Indian software developers don't need to use oil to develop software. As long as they have satellite links and fiber-optic networking, they have all they need. However, if they need expertise in video-on-demand or educational software, they might have to hire a Canadian for that.

That's a globalization BS excuse.

Immigrants have always been eagerly sought by money-hungry
managers. They are easy to bully and exploit. The solution is obviously strong unions which check the power of the bosses.

It's interesting how people never criticize those who are actually responsible for how society works and choose to blame its victims.

For lower salaries than Americans make, they can afford to hire a few servants to do their cooking and cleaning for them.

Slavery is socially acceptable in India as are no running water and open sewers.
Rather than importing the more economical Indian lifestyle
perhaps greedy managers should be exported to India where they can demonstrate their economic indispensibility.

re: Slavery is socially acceptable in India as are no running water and open sewers.

Lack of sanitation aside, the people working as servants in India are getting wages that are fair by Indian standards. It's just that Indian standards for uneducated people are a lot lower than American standards. However, the incomes received by educated people in India are closer to American levels. It is not unusual for people to move back to India because, while their money income is somewhat lower, it is enough to enable them to live in a bigger house and have a few servants to do their cooking and cleaning. In effect, they have a higher standard of living in India than they would in the US. This is a tremendous incentive for them to get as much education as they can.

re: Rather than importing the more economical Indian lifestyle perhaps greedy managers should be exported to India where they can demonstrate their economic indispensibility.

That's actually a rather dangerous possibility. You have to realize that it is getting to the point where the trend toward moving the back-office functions of companies to India to take advantage of the lower wages could extend to moving the front-office functions as well. From there, it's not a big step to move the whole company to India. And then what do Americans do for a living?

I'm speaking as someone who once was approached by an American company to move to manage a new software development operation in Pakistan, so I know whereof I speak. I researched it in some detail. Intestinal disorders aside, my living standards would have been considerably higher than in the US. (That particular deal fell through, but only because they came to the belated realization that Pakistan was not a really safe place to operate compared to India.)

They will as a matter of necessity find other things to get done- lots of them.Inevitably.

This is never going to happen willingly - the status quo of black and white (work yourself to death or be unemployed) is the easiest way to keep the masses in line and not questioning the basic premises that we base our way of life on.

Either work people to death (keep them on the treadmill to pay the mortgage, cars, kids etc.) or keep them jobless and in poverty while the media spews forth constant reminders of what losers these people are for having no jobs, bad credit, debt etc. Provide television to keep both the jobless and dead tired crew entertained for a few hours each day.

For a shorter work week one requirement would be cheaper housing and the government and real estate industrial complex are throwing everything at doing the complete opposite - they are doing anything possible to keep prices propped up.

The prime directive continues to be to push the american dream and to provide more hosts for the financial industry parasites - reducing work hours is directly opposed to this directive and it allows people the time to think a bit more about living outside of the current paradigm - and this cannot be allowed to happen.

Continuing on the thread with twenty plus yrs of blue collar outsourcing it's the white collar workforces turn in the crosshairs of downsizing.The yearly 5% plus gains in productivity which the market rallied. The large % gains in college educated population in countries with low wages the percentage gains in tech all growing exponentially.A guest on CNBC last Friday was asked with higher PPI and lower CPI how will profits continue to grow "wages".Looking back at a text book from the 50's in the back one one page called the "Future" reader digest version computer,robots,and productivity only 30% of population will be needed to supply everyone needs.Who's the 30 was my thought then and now.

This is exactly why I've become significantly more pessimistic over the past few years - joining the ranks of the "doomers" here on TOD.

We are indeed caught in a vicious circle from which I absolutely can't see an exit without unwinding the industrial progress of the past 100+ years. We will retain the knowledge of these industries but we will lose the capacity to do things at either the volume or speed that we've grown accustomed to (dependent on). If we make the choice that we want to continue to support ourselves deep(er) into overshoot along the current trajectory we simply have to have more things done through manual labor and the replacement of this labor by automation has to be reduced - in effect we have to busy huge numbers of potentially idle hands. If we don't choose to do this voluntarily at some point there comes a breaking point where everything goes to hell, violence surges, and the gov't is only able to make token gestures toward resolving fundamental issues - then the wonders of our "futuristic" world really run into problems. Either way I only see one possible outcome - permanently reduced standard of living and a nearly pre-industrial age style of living.

Re US driving decline in reverse. There goes the "peak demand" !

Not necessarily. The "peak demand" concept is not based on recession, nor does it expect people to drive less. Rather, it predicts that we will transition away from fossil fuels (while continuing the happy motoring lifestyle).

Maybe. But the argument that we have seen peak demand is completely undermined if demand picks up again.

No, it isn't. It's undermined if demand reaches a new peak, but Yergin & Co. have said that they do expect demand to pick up as the recession ends.

Yergin's a weasel. The Chinese are now buying more cars than the Americans and every Indian wants a Tata Nano. Even if all of these cars are comparatively fuel efficient, that's a lot of potential new cars on the road.

Yergin predicted peak demand in OECD countries. He expects world demand to increase (for awhile at least), for just the reasons you mention.

Yergin & Co. will equivocate whenever the situation changes, as they have in the past.

As oil peaks, price becomes volatile. This is part of PO theory. High price dampens demand, which then decreases. When this happens Y&C say it was 'peak demand' because of course all they can see is that demand decreased, having blinded themselves in advance to any peak in supply.

Obviously, they believe in a theory of “demand and supply,” not “supply and demand,” and they believe that demand controls endless supply. In their universe, horses all push their carts, and consumers without income all borrow money to purchase goods and services. It is all part of the same strange mentality of the Yergiverse.

And we try to argue with them? Why? We need to leave them behind. Or else, we need to reframe Peak Oil as a demand side equation. Anyone know how to do that?


Rather, it predicts that we will transition away from fossil fuels (while continuing the happy motoring lifestyle).

Shouldn't that be:

"Rather, it predicts that we will painlessly and seamlessly by the infinite powers of the almighty invisible hand transition away from fossil fuels (while continuing the happy motoring lifestyle, expanding a vibrant and burgeoning suburban landscape, and growing, forever without end, the economy and population at an even faster rate!).

I wonder how much of that was actually people stuck on icy/snowy roads, idling?

Redefining Peak Oil: A tale of two countries to give hope to others (uptop)

The premise of this article, which looks at Oman & Colombia, is that an increase in production, to a level below a recent peak, effectively means that the region has not peaked.

So, based on this premise, the US--which is showing a year over year increase in crude production, and which is showing a 1.5%/year crude production decline rate, from 1970 to 2009, versus a 1.7%/year decline rate, from 1970 to 2008--has not peaked.

Or, if world crude production has fallen by 90%, but then we see a year over year increase, then world crude production has not peaked.

IMO, as long as the rate of change calculation is negative, i.e., showing a production decline relative to a recent peak, then the decline has not been reversed.

At this point, why on earth would we want to use what is left any faster than we absolutely have to? I would think that stretching remaining supplies out so that the decline rate is as slow as possible would be considerably preferable - unless a fast crash is something you are really rooting for, from the safety of your remote bunker.

In a post peak region, in order to slow the decline rate as much as possible, you have to increase the rate at which you deplete remaining reserves.

Strange thing on my Oil Drum Google Reader feed today: I got 8 articles from 2007, including the April 10, 2007 Drumbeat. Nice to breeze through past predictions and such.

The Drum was down "for maintanence" for a while last night. I logged on and a bunch of older posts popped up. Your google reader must have grabbed those.

SuperG is trying to add new search capabilities. Been a few bumps in the road.

Using 12-month averages, the study found that driving increased by 0.3% in September, 0.2% in October, 0.3% in November and 0.2% in December over the same periods a year earlier, according to federal data.

Well so much for the idea of peak demand in the developed world. The Saudis, CERA, etc. are wrong.

Not just US driving. US home prices, too.

"Home Prices in 20 U.S. Cities Rose for Seventh Month"


So when does the commercial dive kick in?

When the bulldozers are done?


I'm still wondering if the recession is over (temporarily or not).

Consumer confidence plummets in February

NEW YORK - A monthly poll showed consumer confidence took a surprisingly sharp fall in February, hitting a 10-month low, amid rising job worries. The decline ends three straight months of improvement and raises concerns about the economic recovery.

You probably saw this (posted over at TAE).

Irvine-based John Burns Real Estate Consulting Inc. made national news this past week with a study showing that a new wave of foreclosures will hit the U.S. housing market in the next few years.

According to the Wall Street Journal, Burns Consulting’s study forecast that despite loan modification efforts, the nation has a “shadow inventory” of 5 million units that will be added to the housing market as their delinquent owners lose their homes. This shadow inventory is equal to about 10 months supply of homes.

It's foreclosures that lower the average selling price. I think this shows that strong recovery will be difficult, but given the huge recent decreases, I guess I can foresee averages still rising a bit. People will continue to slop up "bargains". What slows it down is oil prices and perceptions, hard to say...Any thoughts on the anticipated commercial r.e. dive?

Over the next five years, about $1.4 trillion in commercial real estate loans will reach the end of their terms and require new financing. Nearly half are "underwater," meaning the borrower owes more than the property is worth. (Link)

What an ugly link - a little bit more :

Commercial property values have fallen more than 40 percent nationally since their 2007 peak. Vacancy rates are up and rents are down, further driving down the value of these properties.
When the reckoning comes, it could threaten everyone from banks and pension funds to renters and small businesses -- and small banks could be particularly vulnerable.
Warren warned against government inaction.

Alright the recession 'is over', that insinuates that many(most) other factors must do extremely well- I mean to outnumber these very gloomy signals.Of course there is always the consumer confident marker .. heck... down almost 20% from previous month today.

The recession isn't over, the economy is just resting on the staistep until it takes the next plunge downward. The "growth" and "green shoots" that the fools go on and on about is just random noise.

oh yes it 'is over'. Go and ask Obama :-)

5 million homes is NOT "10 months inventory".

That may be the total sales (at whatever price, and for all types of housing) for a 5 month period.

But 2 million new homes/year is a boom. Today we are building about 1/3 million SFRs/year (not latest #) plus an equal # of multi-family housing units.

Given that these 5 million homes are largely SFR (single family residences) and the foreclosed on will move to apartments, back home to relatives, etc. and not into smaller SFRs, we appear to have a decade or more of SFR inventory.

Decay, vandalism and neglect will shrink the "inventory".

I see a decade plus inventory of "shadow" inventory in SFRs.


Yes, good eye, Alan. Note that this article said "6.1 million will lose their homes." The 5 million figure excluded 1.1 million units that were already listed.

... and if there are 3 people on an average living inside them - I think we can firmly say that some 18 millions will lose their homes...

I can never forget this one on Shadow-Inventories in San Diego (Jan 2010)........ Shadow Inventory Is For Real

There are currently 11,976 homes listed for sale in San Diego. If all the shadow inventory were to hit the market, inventory would increase by 162 percent to 31,429.

What will this do to all sorts of homebuilding in SD for the next n-years ? I can't fathom.

The only homebuilding needed anywhere in the nation is a little infill amongst all those vacant urban lots - and mostly with duplexes and multi-family units at that. Some homebuilders will find an opportunity to continue making a living by shifting to remodeling work as homeowners add accessory apartments and retrofit their homes for energy efficiency. The era of big new suburban subdivisions is over, forever, and the big companies that made their money building those are doomed to extinction.

It is important to keep in mind that the “Home Prices” reported are those of homes that sold. Today, a phenomena that is widely reported is that families are looking for larger homes, to accommodate multiple generations (and multiple families, IMO). The few homes that are being purchased, are multi-owner, multi-generational residences, larger in size and hence a slight demand for them may manifest.

The other side of the housing market is the new record of foreclosure filings reported in January.


As you can see, RE Agents have found a way... short selling.

And of course banks are not foreclosing on many loans, IMHO as part of the 'deal' they made with the Fed in the bailout.


As for taxpayers bulldozing their homes, or flying planes into IRS buildings, your guess is as good as mine. The act seems excessive to the motivation... these people need to get a grip.

The commercial dive, though, is under way.


The 50-story building I worked in a few weeks ago is closed. New buildings are being built. We sound like China, don't we?


Good luck with understanding real estate and better with understanding stimulus.



Banks at risk of going bust tops 700

NEW YORK (CNNMoney.com) -- More than 700 banks, or nearly one out of every 11, are at risk of going under, according to a government report published Tuesday.

The Federal Deposit Insurance Corp. said that the number of banks on its so-called "problem list" climbed to 702, its highest level since June 1993.

That chart looks uncomfortably like a hockey stick. How high do you suppose we will go?

Remember, there were more than 1500 on the list in 1990. For a persepctive check out:




Is there a way to index this chart, do you suppose, to account for numbers of banks. I believe that there were many more banks in 1990 than there are today, reflecting a failure of our anti-trust laws in general. I know there were many fewer in the 1930s. I suspect that an indexed chart would show similar numbers in 1930s, 1988-1992 and today.

What has never been mentioned in the mainstream media is that by saving the big banks, smaller banks were precluded the opportunities for expansion that would have been possible if the big banks shut down. The main point of all the moving and shaking last year was to assure that the large and powerful banks with their powerful CEOs stayed in business, and to assure that the bank closures would be amongst the small guys instead. The well-being of the nation had absolutely nothing to do with any of that.

Another win for the big banks, I suspect, because they can then buy off the assets of the failed banks at discount rates.

Calculatedriskblog is very good at publishing these, and other financial-related news stories and data.


With apologies to WT, Rockman et.al.

The Texas ratio is a measure of a bank's credit troubles. Developed by Gerard Cassidy and others at RBC Capital Markets, it is calculated by dividing the value of the lender's non-performing assets (Non performing loans + Real Estate Owned) by the sum of its tangible common equity capital and loan loss reserves.


One list of banks with a high Texas ratio:


This was the end of October, so I'm sure some of these banks are history. I found a more up-to-date list yesterday. I'll try to find it.

Apology Ghung? Did I miss some slight? I hate it when I do that but being a geologist I'm so use to being dis'd I miss it some times. LOL

Not yet. They all predicted demand would increase as the economy recovers. A fraction of a percent increase year over year is not a new peak, any more than Oman's increase in production year over year means they did not peak. Congestion is still down 2/3 from the peak, according to the article.

I have not seen this news on Google Energy here, yet:

Google gets go-ahead to buy, sell energy

Rat gets go-ahead to buy, sell energy too.
Got a letter from PG&E saying, effective with my next yearly billing period, I'll get paid for any XS electricity my panels produce. I've never gone negative, cuz I didn't want to give welfare to PGE, but now...
I can produce 500KWH more by either buying 3 more panels and upgrading my inverter for maybe $2500, or by taking advantage of Cash for Appliances and replacing my 23 year old fridge for about $700. More panels are still an option, and I have room for 2 or 3 more on the mount, but I'll probably plug my seasonal creek in next. One of these years, I'll be able to claim my occupation is "green energy producer".

Hmmm, I didn't notice that. But I've had one day that was positive (yesterday), but we start a whole week of cloudy days according to the weatherman.

As usual the cheapest energy is negawatts. Our biggest saver is the spin dryer. It is unfortunetely manpower intensive, but it cuts clothes drying energy costs by a lot. I suspect adding panels -plus inverter swop out is gonna be pricey. I hope I missed the thing about getting piad for any excess. My system is probably too small for that to be an issue. But when the kids go off to college, our use could drop quite a bit, so I can't say we won't get there.

Latin America backs Argentina as Britain begins Falklands oil quest

This should be fun to watch. If Argentina, Hugo, et al are smart, they'll lay low and let the British do the hard part. If they do find oil things may get interesting. Maybe that's what Britain needs, a nice little war for oil.

Ghung -- They won the last war they fought in the S Atlantic. It will be interesting to see how hard they go after the next given their front row seat view of the decline in N. Sea production. The last one was fought perhaps over national ego more then any other motivator. The next one may appear as a battle for economic survival. In my book an empty stomach trumps a big head.

I wonder if the US will choose to sit this one out, since, if it happens, it'll be over oil in our hemisphere. The British did support our actions in Iraq, after all. In that case, the naval part of this thing would be very short.

In the future, if you really want to be popular, find a couple million barrels a day of oil production. The UK with oil will be a lot cooler than the UK without oil.
Argentina is being run by the latin american version of Sarah Palin and Hugo is dealing with blackouts.

Come, cheer up, my lads, 'tis to glory we steer,
To add something more to this wonderful year;
To honour we call you, as freemen not slaves,
For who are so free as the sons of the waves?

Heart of oak are our ships, jolly tars are our men,
we always are ready; Steady, boys, steady!
We'll fight and we'll conquer again and again.

majorian, OK, this is really wierd: In 1982, March I think, my ship was on it's way to the Persian Gulf and we pulled into Gibraltar, nested alongside the HMS Sheffield. The Sheffield crew invited some of us aboard for a few pints. Nearing the end of their ration, "Steady Boys" was the song they sang.

A couple of months later we got word that the Sheffield had been sunk in the Falklands. Ironically, the Sheffield had been completed, after an explosion during construction, using a section of a ship being built for the Argentine Navy.



Interesting Ghung. I imagine you appreciate more then most how a little tech can change the battle plan. If I recall correctly Arg. had only 2 or 3 Exocets (sp?) when the battle began. Amazing how one $500,000 piece of tech can take down a $150 million (WAG) vessel. I wonder if Arg. has a better stockpile now?

The Sheffield had an outdated defense system due for replacment. The British weren't very happy with the French after the incedent, since the Exocet was their baby. The British missle techs showed a lot of interest in the Phalanx system aboard our ship. Too bad they didn't have one in the Falklands.

Ghung -- yes indeed. A line vessel taken down by a bottle rock that might have been defeated by a high-fire rate pop gun. Just not the good ole days when you went along side and boarded with drawn cutlery.

I suspect our support for the Brits would be two-fold: satellites and a USO show with Jessica Simpson. A 1 -2 punch if there ever was one.

Not really.

The Phalanx is more talk than proven success, and its highly likely that if push comes to shove it would be shown to be ineffective against real sea skimmers (particularly supersonic, dog-leggers). The main problem with the Sheffield is the missile defence was turned off, and the aluminium burnt well (the warhead didn't do the damage).

Don't forget, Sea Dart took out a Silkworm in the gulf; that and SeaWolf are quite capable of taking out Exocets if used properly.

C'mon, g. This was almost thirty years ago. I did see it work well against dummy Tomahawks. Never missed and cut 'em to pieces. A big problem has been collateral damage:

On February 25, 1991, during the first Gulf War, the Phalanx-equipped USS Jarrett (FFG-33) was a few miles from the USS Missouri (BB-63) and the destroyer HMS Gloucester (D96). The ships were attacked by an Iraqi Silkworm missile (often referred to as the Seersucker), at which Missouri fired its SRBOC chaff. The Phalanx system on Jarrett, operating in the automatic target-acquisition mode, fixed upon Missouri's chaff, releasing a burst of rounds. From this burst, four rounds hit Missouri which was two to three miles (about 5 km) from Jarrett at the time. There were no injuries.


You're point up the instance where the Sea Dart took out the Silkworm and the Phalanx shot up its own side? Not sure you've got the hang of this debate lark.

Phalanx, and all the systems like it, have a big problem and a number of little ones, when it comes to defence against sea skimmers. I'm not going to point it out, but its fairly obvious and its been identified and used to counter such systems.

BTW one of the small issues is by the time the sea skimmer is close enough to reliably engage, its close enough that it will hit its target, no matter if you manage to put a round or two from the Phalanx into it. Remember, even an Exocet is a good 6m long and as big round as a dustbin. Travelling at 300m/s an engagement at a kilometer out is just three seconds till it hits.

I never said it's a good system, just that, at the time, my Brit friends thought it was cool. As for the Sheff, a lot of things could have been done differently. As you say, skimmers are tough to counter, especially in high seas. Best defence? Prevent their launch.

Amazing how one $500,000 piece of tech can take down a $150 million (WAG) vessel.

Or 'Destruction Returned On Destruction Invested' of 300 to 1. Fourth Generation Warfare in action.

The book to read (if you haven't already read it, that is) is John Robb's much-acclaimed Brave New War:


John Robb's website, Global Guerillas, is here:


Good point CO. Similar to the cost efficiency of a $2 30-06 from a Marine sniper popping a unit commander. The conversation reminds me of a scene in "Enemy of the State" (?) with Gene Hackman: you use your apparent weakness as a weapon. If your few in numbers you can move quickly and quietly, etc, etc.

Or sort of like the King and Queen of the IED:


Excellent Ghung. Took me a minute to get it...no sleep last night.

Sunk with French Exocet missiles.

Yes, war is terrible, cruel, yada-yada-yada.

Falklands Islands were discovered by the Brits, settled by the Brits, conquered by the Brits, etc. It's their land and their oil.
The Brits aren't going to give back Gibralter which is physically part of the Iberian Penninsula.

Argentina's politicians and generals use it to score points. About as solid a claim as Saddam Hussein claiming Kuwait was the 13th province of Iraq.

Christina succeeded her hubby as president in true Peronista style.




Funny! Go to your wiki link and click on her fotolog link, you get this:

This article is written like an advertisement. Please help rewrite this article from a neutral point of view. For blatant advertising that would require a fundamental rewrite to become encyclopedic, use {{db-spam}} to mark for speedy deletion.

Did you write this, majorian? ;> It seems her popularity isn't universal.

That was quite nasty of me.
I regret it already.
But these politicians(like Bush) love to cook up wars.
The Argentine military was going to attack Chile over a similar border claim but the Pope stopped it.
I guess the Pope can only stop wars between Catholics(sometimes).

Falklands Islands were discovered by the Brits, settled by the Brits, conquered by the Brits, etc. It's their land and their oil.
The Brits aren't going to give back Gibralter which is physically part of the Iberian Penninsula.

Claims on territory can get pretty interesting. Muammar Gaddafi, who is pretty smart and well educated, claims Sicily as part of Libya based on the fact that it occupies the same contiguous tectonic plate as Libya.

"Claims" aren't worth the paper they're written on if a more powerful force occupies them. Especially if the locals side the other way -- who do the Falklands inhabitannts see themselves as part of?

All too true. When asked my opinion about the situation in the Middle East, my reply is, 1) there is no moral high-ground and 2) the operative principle is 'might makes right'

Whoever has the military power to take and hold a piece of land owns that land.

I seem to remember a "Monroe Doctrine". Something about European nations keeping their hands off the Americas. How did the Falklands avoid that?

Not that we didn't exhibit high hubris ourselves in ennunciating that.

With so many new finds being out to sea, whose oil is it, anyway?


Regarding Kuwaiti-an history vs Saddam/Iraqi claim vs the Brittish (the juicy part prom wikipedia)

Oil was first discovered in Kuwait in the 1930s and the government became more proactive in establishing internationally recognized boundaries. After World War I, the Ottoman Empire was financially crippled and the invading British Indian Army invalidated the Anglo-Ottoman Convention, declaring Kuwait to be an "independent sheikdom under British protectorate".

That land is equal to the Burgan oilfield - nothing more, but nothing less either, strange heh ?

If you Google Ottoman-maps back in time- there is nothing called or named Kuwait as a land or province- it was a trading port in the Ottoman Empire.. Middle East 1914

Falklands anthem is "God Save the Queen"- so if the UK just keeps a low non aggressive profile towards Argentina, NATO has to step in if they are attacked...
Argentina just made a statement that their ports were not part of any supply line for exploration and other oilish activities at the Falklands, whatsoever - so probably UK has to settle with St Helena for that purpose.

"Maggie" privatize everything Thatcher was sinking in popularity until this little war happened.
A propaganda coup!
If the Argentine air force had had more than 15 planes, and more Exocet Missiles, this would of possibly backfired on the simpleton brit neocon.

Actually the reason they are probably stirring the **** now is that if oil is found, some significant military resources will be stationed down on the Falklands; permanently and swiftly. Wouldn't take long to fly a squadron or two down there, etc.

The chances of argentina getting a look in will drop from "very unlikely within 50 years" to "not a chance in hell".

Thus they chance their arm now, trying to get their continental compatriots onside, so that they are better positioned, and maybe (they think) can stop the drilling till the UN extended sea rights get determined.

Problem is, there is NO chance that the UK will give anyone the time of day on this one. Its immediate election success or failure to give ground on this and Gordon has got to be hoping against hope that they continue with these pointless actions, so he can look better and not lose the forthcoming election too badly.

Honestly? The UK public would happily see bombing of Buenos Aires if it came to it - this is not a matter that's up for debate in the UK psyche.

Today's relatively "cheap" gas won't last, says Stephen Schork, editor of the The Schork Report

Goldman Sachs forecasts oil will trade between $85-$95 per barrel for most of the year. Schork says that has nothing to do with fundamentals. "We kind of have this backward economic logic where we bid up oil prices very high, expecting this demand to return,"

"In very few circumstances do we push prices to a very high level and then expect the demand to occur." But, that's exactly what's happening. Schork says Wall Street is telling clients to use oil as a hedge against potential inflation to come.

As a result, crude is trading ahead of demand fundamentals -- leading to our second issue.

Refinery Margin Squeeze. With prices too high for demand, refineries are forced to keep product off the market by closing facilities. "The industry, to protect their margins, has to take matters into their own hands,"



oil in 1971 average price was $3.0
gold average price in 1971 was $35
oil obviously was unconstrained supply

fast forward 39 years to 2010
oil now is approx $80
gold is approx $1100

gold growth rate over 39 years is 9.2% (I'm taking it as a proxy for true inflation)
if oil grew at 9.2% it would be $90. so oil really has only kept up with inflation, as it should. you can explain all increase in oil prices by inflation alone,
given that it has been in an unconstrained supply environment

so over the past 40 years we have had very small periods of constrained supply:
the two oil shocks in the 70s and six months dec2007/june2008

oil does funny things when it is in constrained supply

Very timely historical review poly....thanks

Francisco Blanch, from Bank of America Merrill Lynch, said crude may touch $105 next year, with $150 in sight by 2014


Gold & oil inflated by 30x in the last 40 years?
In the same time, a movie ticket went from $2.50 to $10, and a slice of pizza went from $0.50 to $2.00 - 4x.
If inflation was 30x, then movies and pizza got 7.5x cheaper!

That is the result of the mechanisation of agriculture and the 'green revolution'. In real terms, food has got dramatically cheaper.

Also, the IT revolution has done the same for the Movies. A busy Berkeley move had incredible budgets in terms of man hours, etc.

Films are global releases these days. make more money on the back of merchandising, and TV and DVD rights than at the cinema. The cinema is the loss leader.

Since there's not a lot of good news out on any front, I offer this up as something at least somewhat encouraging:

"New figures show teen births hit record low in California"

Births to teen mothers in 2008 fell to 35 for every 1000 teen females, down from 37/1000 in 2007 and way down from 71/1000 in 1991. This is in contrast with national teen birth rates which have been rising. (42.5 in 2007, up from 40.5 in 2005.)

Evidently California never accepted Federal dollars dictating abstinence-only pregnancy prevention and instead came up with a combination of education and access to contraceptives that worked. But with the severe fiscal crisis in front of us, who knows what programs will be slashed and burned.

Sounds like such a small drop could be attributed to a significant portion of the illegal alien population returning home due to lack of work, and taking their kids with them.

The article details how the Latina birth rate fell dramatically. However, the data is from 2008, a year that population continued to rise in California, so I doubt the decrease could be attributed to illegal aliens leaving the state.

This is indeed good news but the explaination as far as politics doesn't work.The trend is down nationally.

let's get this straight, only lowering wages and benefits on workers and raising profits for the elite can save uhmerika. i fart on that philosophy.

have you reduced your lifestyle today? if you didnt, did you reduce someone else's?

as for glopal warning:
"Scientists are chipping away at a glitch in the climate records, hoping to explain why tree-rings that track temperature changes successfully until the 1950s suddenly veer off."

where's my atom powered rickshaw?
"The Nuclear Regulatory Commission confirmed Monday that a whistleblower told the truth last week when he told a member of the Vermont Legislative Oversight Panel there was an earlier radioactive leak of tritium at the Vermont Yankee plant in the same area that is the focus of the current leak."

your tax dollars at work. military rah-rah-rah!
"The world’s most expensive military cemetery, a £22.6 billion centre dubbed “The Boneyard”, has been pictured in a spectacular series of new high-resolution Google Earth satellite images."

lots of trolls for TPTB on TOD. mebbe i can get a job making more than $15/hr doing the same.
"The Drive to Eliminate Social Security in America"

"no one gets out of here alive"-the humungus
"it's all good"-anon.

A few last minute adjustments to this warehouse retrofit have bumped our expected energy savings to 78,489 kWh a year. Albeit a small drop in a seemingly bottomless bucket, this one retrofit will nonetheless eliminate some 66 tonnes of CO2 emissions each year, and adds to the over 70 million kWh in energy savings Nova Scotia Power has racked up over the past two calendar years (with a whole heck more to come). Plus, 26.7 kW of "new capacity" brought online at less than $1,000.00 CDN per kW. We're also focusing our efforts in areas where load relief might help forestall expensive upgrades to NSP's transmission and distribution systems.

No more coal-fired power plants !


What ever this company saves on (smart or should I say common sense) lighting- they plow out at least the same amount for heating further down the same bill-
.... at least if the T-shirt guy in the background feels comfy at Halifax latitudes at this time of year, with 12 meters to the ceiling :-(

/personally I'm a little bit fed up these light-pix. I think TOD has gotten this clue by now/

Efficiency and improvements are a little unexciting, but in fact Paul is showing us Actual energy improvements each time. Pretty much as radically ON MESSAGE as one can get for this site.

For me, for the one or two pix and comments every few days, it's a great reminder of the dull and steady progress we need to make on the most basic things, if we want to push our energy situation in the right direction.

I'm hope you're more bored and agitated by the dead-end, but interminable and antisocial arguments on Population, Religion and even Climate change, when it just becomes a bash-fest of 'Oh, yeah!?' and 'I suppose you believe that yada yada..'

Hopes for more boring and wise improvements, and enthusiastic witness to it. Go Paul!


I agree !!

Best Hopes for More,


Alright point taken.
And let me be perfectly clear about it- I really honor Paul's efforts on these important efficiency installations- b/c they represent the 'easy way'.
That said- the ideas of white reflectors and white surroundings in regards to 'better lighting' is as old and well known as civilization itself- it's self explanatory IMHO. I mean, everybody know this, so me for one don't need to be reminded of this every few days, particularly on a forum where mostly the same people mingle every day. First day every month would suffice for me.... thus also new readers would be able to get this takeaway-point at some stage.

Thanks, Bob. Traditionally, when it's getting late and the host wants to break up a party, they yawn and stretch their arms upward and engage in other perhaps not so subtle visual clues. Now, they get me to start talking about ECM motors and low-flush toilets. Man, you should see the crush of humanity trying to squeeze through the front door and piling into their cars.

Energy efficiency sure ain't glamorous, but the work we do on behalf of Nova Scotia Power provides many tangible benefits. Customers directly benefit from lower utility costs and improved cash flow; improvements in light output and light quality often result in increased sales, improved productivity and enhanced worker safety as well. The utility benefits in that, for us, we don't have to spend a billion or more dollars building a new coal-fired power plant at a time when banks don't want to lend money for such things and the regulatory environment is fraught with peril. Ratepayers also gain because DSM initiatives are almost always the lowest cost source of new supplies. And, lastly, we all benefit when we're not pumping as much nastiness into our environment or permanently scaring our landscape by building massive scale hydro-electric facilities.

Best hopes for greater energy efficiency and fewer hosts with bleary red eyes !


HIH, I appreciate your occasional snippets of "light" in the midst of so much "heat" in the blogs. You are doing, on a daily basis, what most here know needs to be done yet fail to undertake. I wish the US gov't could clone your operation instead of the mud-stuck home upgrades of the stimulus packages.

Ever thought about franchising? Do you actually make some money doing this?

I, too, enjoy the photos and descriptions of your projects. Very concrete and practical. Maybe not so glamorous, but it shows that there's much that can be done to tame the energy beast if we just chip away at it day after day, light fixture after light fixture. Thanks for all that you do. Nova Scotia is lucky to have you.

Thanks taomom and Paleo. Admittedly, I beat this one drum and this same one note time and time again, so I appreciate it can get rather repetitive.

There's a tendency, at least in some quarters, to view energy issues largely in terms of supply. In the utility industry, you simply built more plant to meet demand and, God forgive us, we did everything in our power to promote further load growth so that we could do more of the same. Thankfully, this is changing as a host of other factors come into play; e.g., rising fuel costs, political and regulatory uncertainty, diminishing economies of scale, changing customer expectations, siting concerns, etc.

As many of us know, there are tremendous opportunities to reduce our energy needs by pursuing simple and cost-effective efficiency measures. My primary focus happens to be lighting and a 50 to 60 per cent reduction in lighting load is pretty much a given in most cases. I quite often speak of heat pumps, both for space heating and domestic hot water supply. I'm working with a client now to hopefully install a heat pump water heater in their commercial kitchen; it would supply all of their domestic hot water needs and a large portion of their air conditioning requirements as well -- in effect, two vital services for the price of one (see: http://www.hotwater.com/lit/spec/com_hp/AOSZE15000.pdf). In just about every sector and across almost every end-use, the potential to do better with less is there. However, it's easy to overlook this and that's why I like to reference these examples from time to time.