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Drumbeat: April 6, 2010
Posted by Leanan on April 6, 2010 - 10:08am
Peak oil man shifts focus to peak price, demand
(Reuters) - The economic shock of global recession has led a prime exponent of the theory conventional oil output has peaked to shift his view of the consequences, but he still thinks the world has to go green.Retired petroleum geologist Colin Campbell, who worked for major oil companies as well as smaller firms, has long been associated with the belief the world's oil supplies are dwindling.
He does not waver from that and dismisses the argument of the so-called optimists that technology will manage to keep eking out more and more oil to keep pace with rising demand.
What has changed is his opinion of the price impact and implications for fuel consumption after the spike of July 2008 to nearly $150 a barrel was followed by world economic recession, a deep drop in fuel use and a crash in oil futures to just above $30 in December 2008.
"I have changed my point of view about future prices," said Campbell, who used to think the peak in conventional oil production, which he believes happened in 2005, would lead to a relentless price surge.
Oil rises to fresh 18-month high above $87
LONDON (Reuters) - Oil rose to a fresh 18-month high on Tuesday, rallying for a sixth consecutive session as investors awaited oil inventory data out of the United States.U.S. crude for May delivery was up 12 cents to $86.74 a barrel by 1358 GMT, down from an intraday peak of $87.09, the highest since October 2008.
U.S. Raises 2010 Oil Price Outlook on Economic Growth
(Bloomberg) -- The U.S. government increased its crude oil price forecast for 2010 on projections that the global economy will rebound through the end of the year.West Texas Intermediate oil, the U.S. benchmark, will average $80.74 a barrel this year, up from last month’s forecast of $80.06, according to the Energy Department’s monthly Short- Term Energy Outlook, released today. That’s 31 percent higher than the 2009 average price of $61.66 a barrel.
U.S. Forecasts LNG Imports to Increase 42% in 2010
(Bloomberg) -- U.S. imports of liquefied natural gas may rise 42 percent in 2010 to approximately 1.76 billion cubic feet per day, the Energy Department forecast today in its monthly Short-Term Energy Outlook.The latest estimate for 2010 imports was 2.2 percent lower than the previous forecast. The department’s Energy Information Administration last month predicted imports of 1.8 billion cubic feet per day.
U.S. Carbon Emissions to Rise 2.1% in 2010, EIA Says
(Bloomberg) -- U.S. carbon dioxide emissions from energy use will climb 2.1 percent this year as the economy emerges from the recession, the Energy Information Administration forecast today.
Saudi Arabia’s crucial role in the crude price outlook
It’s a well-known Opec phenomenon that while most members break any production quotas to increase their own oil revenues, Saudi Arabia not only adheres to the targets but at times produces even less than its own quota to offset the poor compliance of other Opec states. This is one reason it has become known as the ‘central bank of oil’. The other (related) reason is that Saudi Arabia has more spare capacity than any other oil producing nation, although exactly how much is not completely clear and hotly debated.
Iraq to Take Control of Oil Revenue by End of 2010, UN Says
(Bloomberg) -- Iraq’s government will install a metering system to properly track crude oil production and take full control of the disbursement of revenue from oil exports by the end of 2010, Iraqi and United Nations officials said.
Desire abandons Liz in Falklands
British oil explorer Desire Petroleum said it had plugged and abandoned the first well to be drilled as part of a controversial oil exploration programme by UK companies in the Falkland Islands.
Qatar says oil spike is speculation
Qatar said crude oil prices are being pushed up by speculators rather than by any shortage of supply.
Brazil sees China interest in offshore oil fields
RIO DE JANEIRO (Reuters) - Chinese energy companies will likely participate in bidding for Brazil's offshore subsalt oil reserves when auctions begin and are already seeking to buy stakes in existing oil projects, a top energy official told Reuters.Chinese President Hu Jintao is slated to visit Brazil next week to deepen ties with the South American nation as it taps tens of billions of barrels in the offshore subsalt province that has become a new frontier for petroleum exploration.
Argentina Soy Growers ‘Optimistic’ on End to China Oil Blockade
(Bloomberg) -- Argentina is “optimistic” negotiations will end a blockade by China on soybean oil imports that may cost the South American country as much as $2 billion, an Argentine soy industry official said.
Pioneering environmentalist Bill McKibben hopes to take his readers by the collars and shake them in his new climate change wake-up call, Eaarth.
Clay Shirky: The Collapse of Complex Business Models
Tainter’s thesis is that when society’s elite members add one layer of bureaucracy or demand one tribute too many, they end up extracting all the value from their environment it is possible to extract and then some.See also: Mayans, Romans and Peak OilThe ‘and them some’ is what causes the trouble. Complex societies collapse because, when some stress comes, those societies have become too inflexible to respond. In retrospect, this can seem mystifying. Why didn’t these societies just re-tool in less complex ways? The answer Tainter gives is the simplest one: When societies fail to respond to reduced circumstances through orderly downsizing, it isn’t because they don’t want to, it’s because they can’t.
Richard Heinberg: Economic History in 10 Minutes
Here is all of economic history compressed into one sentence: As societies have grown more complex, larger, more far-flung and diverse, the tribe-based gift economy has shrunk in importance, while the trade economy has grown to dominate nearly every aspect of people’s lives, and has expanded in scope to encompass the entire planet.With more and more of our daily human interactions based on exchange rather than gifting, we have developed polite ways of being around each other on a daily basis while maintaining an exchange-mediated social distance. This is particularly the case in large cities, where anonymity is fostered also by the sheer numbers of people one sees from day to day. In the best instances, we still take care of one another—through government programs and private charities. We still enjoy some of the benefits of the old gift economy in our families and churches. But increasingly, the market rules our lives. Our apparent destination in this relentless trajectory toward expansion of trade is a world in which everything is for sale, and all human activities are measured by and for their monetary value.
Stuart Staniford: Implications of Unmeasurable Capital
This seems to me to bear on one of the hardest issues at the heart of any "Risks to Civilization" discussion: how resilient is modern civilization really? In the past, in discussions with collaborators trying to figure out how vulnerable civilization is to large scale cyber-attacks, I've run into the fact that different folks have radically different intuitions about this, and it's very difficult to come up with a methodology that makes the situation more objective.
James Hansen: Obama's Second Chance on the Predominant Moral Issue of This Century
The predominant moral issue of the 21st century, almost surely, will be climate change, comparable to Nazism faced by Churchill in the 20th century and slavery faced by Lincoln in the 19th century. Our fossil fuel addiction, if unabated, threatens our children and grandchildren, and most species on the planet.Yet the president, addressing climate in the State of the Union, was at his good-guy worst, leading with "I know that there are those who disagree..." with the scientific evidence. This weak entrée, almost legitimizing denialists, was predictably greeted by cheers and hoots from well-oiled coal-fired Congressmen. The president was embarrassed and his supporters cringed.
Uganda's oil: A bonanza beckons
A DETERMINED push by Western wildcatters and big oil companies from fast-growing Asian economies such as those of China and Malaysia may change the fortunes of several countries in remoter and trickier bits of Africa once largely ignored by foreign investors. One of the most spectacular recent finds has been in Uganda. The reserves of the Albertine rift, which takes in the Ugandan and Congolese shores of Lake Albert (see map), are said to need $10 billion for development. All being well, Uganda will soon become a mid-sized producer, alongside countries such as Mexico. Foreign investment in Uganda may nearly double this year to $3 billion. The country expects to earn $2 billion a year from oil by 2015.
Ukraine Says Russia to Consider Reduction in Price for Gas
(Bloomberg) -- Ukraine said Russia agreed to consider proposals to cut the price of natural gas exports, President Viktor Yanukovych said in a statement.The accord was reached during a visit by Yanukovych to Moscow yesterday, according to the statement issued in Kiev today. Yanukovych asked Prime Minister Mykola Azarov to prepare a set of proposals for the Russian side.
Total Maintains Iran Oil, Gas Deals Worth Billions of Euros
(Bloomberg) -- Total SA, Europe’s third-largest oil company, continues to receive crude oil as payment for developing four Iranian natural gas fields while buying billions of euros worth of fuel from that country last year.
The Secret of Libyas Liquid Gold
An infinite wealth of treasure lies in The Elephant Field, 800km south of Tripoli, which was discovered by the Italian company Eni in 2006. The Elephant Field drew a renewed focus upon MENA oil and gas, and showed that there are new possibilities waiting to be found in the face of a global oil crisis.Booming investment within China and India has created a vast amount of pressure on MENA oil reserves, but Libya could hold the solution. There are doubts over Libyan official records regarding their oil and gas reserves; oil and gas experts insist Libya has much higher amount than they are currently prepared to say. Although Libya hopes to reach a target of three million bpd by 2013, this is impossible without foreign investment. Therefore Libya might be a key port of call for the struggling oil and gas industry, which is set to be one of the items up for discussion at the illustrious NGO&G MENA Summit (run by GDS International) being held this week in Doha.
El Paso Gets Go-Ahead for Ruby Pipeline
El Paso Corp. has received Federal Energy Regulatory Commission (FERC) approval for its Ruby Pipeline project. Ruby is a 675-mile, 42-inch interstate natural gas pipeline that will access significant Rockies supplies and make them available to consuming markets in California, Nevada and the Pacific Northwest.
Divided Aborigines in vital vote over $30bn gas plant plan
A BITTER split among Kimberley Aborigines over Woodside Petroleum's plan to build a $30 billion gas plant will come to a head today when native title claimants decide whether to oust opponents of the project from their claim group.
Pakistan: Domestic generators face action
AMID the energy crisis in the country, the Sui gas authorities are all set to launch a campaign against the use of gas generators by domestic consumers that will certainly add to the miseries of people who are already fed up with loadshedding.The Sui Northern Gas Pipelines Ltd (SNGPL) has initially scrutinised a list of about 6,000 domestic consumers who are ‘illegally’ using gas for standby power generation. The authorities will start checking of illegal gas-powered generators during house-to-house search and will cut connection on the spot. The SNGPL has warned that users of gas generators should register with gas authorities if they want to avoid action.
Britain may block World Bank loan for coal plant in South Africa
The Government is considering blocking an aid project to provide reliable coal-fired electricity for millions of South Africans after coming under intense pressure from green groups in the run-up to the election.On Thursday, Britain will cast the deciding vote on whether the World Bank should grant a $3.7 billion (£2.4 billion) loan to allow South Africa to build the Medupi coal plant.
French Propose Methane Project for Ukraine
French investors are offering an environmental project to recover and utilize methane at five mines in Donetsk Region, Ukraine, Ostrov.org reports. “Such a project does exist within the framework of co-operation between France and Ukraine. Our companies are proposing to utilize methane in order to turn its normally negative effects into something positive”, French Ambassador to Ukraine Jaques Faure said.
Surge of Enthusiasm Greets US Offshore Power Study
A new wind is blowing in, stirring up the scientific, media and business communities with its powerful implications for the U.S. energy supply: limitless, renewable, clean electricity that's capable of powering the entire Eastern Seaboard.But where, exactly, would it all come from?
Right off the East Coast, according to scientists. That's where some 11 weather-monitoring stations are stretched out across 1,550 miles from Maine to Florida. At present, they're just collecting meteorological data, but imagine if each one had an electricity-generating wind turbine and all were connected to a single power grid by a giant undersea cable.
Site C Would Drown a Vital BC Breadbasket
If anyone needs a reminder of what kind of damage a dam can do, they told me, they need only visit the W.A.C Bennett Dam, the massive two kilometre-long earth-fill dam that was completed in 1967. Nearly 50 years on, the Williston Reservoir, a 70,000 square kilometre watershed that was flooded by the dam, remains a striking testament to the near-apocalyptic damage a dam can do to its surrounding environment. That massive reservoir, the largest body of water in British Columbia, was supposed to provide local residents with a valuable recreational resource and nearby First Nations communities with a bounty of fish and fowl. Instead, though, it is a dead zone, a toxic stew of dead trees and mercury-filled fish surrounded by the still-eroding banks, and recreational activity in the reservoir is limited to those with a taste for the extreme.
A revelation for the gas market
The mystery over how US natural gas production has increased while rig counts have decreased might be solved, in part because it might not actually have been rising that much. At least, not as much as EIA data had suggested.Industry rig counts, although increasing for the natural gas industry in the past few months, crashed last year from their mid-2008 highs and remain more than 600 rigs short of the 1,600-rig high. Yet production levels as estimated by the EIA in its 914 report have only fallen slightly since then. And prices, of course, are low.
Natural gas futures have risen on news that the production data are being revised, and reports that it may be revised downwards. But how big will the impact be?
Oil rises over $86 a barrel — an 18 month high
NEW YORK - Oil and gasoline prices climbed to 18-month highs Monday as a batch of new economic reports provided more signs that the U.S. economy is back on steady footing and demand for crude will follow.The worry now among some analysts is whether gasoline pump prices are starting to approach a level that could choke off the recovery.
Tanker Rates Seen Sinking 35% Amid Refinery Cutbacks
(Bloomberg) -- The most profitable supertanker market in more than a year is heading for a 35 percent slump as oil refineries from Japan to the U.K. shut for maintenance and leave a surplus of vessels.Shipping costs will fall to an average of $28,758 a day this quarter from $44,576 on April 1, according to the median estimate in a Bloomberg survey of 13 analysts, traders and shipbrokers. Rates to hire the ships, each bigger than the Chrysler Building, averaged $49,908 a day in the first quarter, the most since the last three months of 2008.
Oil Refiners to See Profit Boon in Dubai’s Drop Versus Brent
(Bloomberg) -- SK Energy Co. and rivals including Reliance Industries Ltd. may raise their output as price declines for more dense crudes such as Dubai and Arab Medium boost processing profits, company officials and analysts said.“The more sophisticated refiners benefit from a widening light-heavy spread,” said Victor Shum, a senior principal at consultants Purvin & Gertz Inc. in Singapore. “It would be a positive for most refiners and certainly help the export refiners like SK. You may see some increased operating rates.”
Natural gas boom brings riches to a rural town
(Reuters) - At a windswept rail yard at Wellsboro in northern Pennsylvania, dozens of railcars wait to load thousands of tons of sand onto trucks that will take the cargo to natural gas rigs across the state.The freight railroad, which runs 35 miles north to Corning, New York, had its busiest year in more than two decades in 2009, fueled by demand from a booming natural gas industry, which uses sand in hydraulic fracturing operations.
SKorean warship catches up with hijacked tanker
SEOUL, South Korea – A South Korean navy destroyer caught up with a hijacked supertanker carrying about $160 million of crude oil and was maneuvering nearby in the Indian Ocean, South Korea's Foreign Ministry said Tuesday.The supertanker, on its way from Iraq to the United States, is believed to have been hijacked by Somali pirates, the latest high-value bargaining chip for the sea bandits. Similar seizures of oil supertankers in the waters off the coast of lawless Somalia have yielded ransoms as high as $5.5 million.
Iran says oil sanctions threat "a joke"
TEHRAN (Reuters) – The idea of international sanctions on Iranian oil exports is a joke, a senior Iranian official said on Tuesday, adding Iran would not abandon its disputed nuclear work despite mounting international pressure.U.S. President Barack Obama is pushing for new U.N. sanctions in the coming weeks to pressure Iran to stop its sensitive nuclear activities, which Washington and its European allies believe is a cover to develop bombs.
Saudi Argas Sees Aramco Red Sea Award ‘Shortly’
(Bloomberg) -- Arabian Geophysical & Surveying Co., part-owned by the world’s largest seismic surveyor CGGVeritas, expects Saudi Aramco to award a contract for exploration work in the Red Sea “shortly.”“We have already answered the bid,” Saad al-Akeel, chief executive officer of the company known as Argas, said in a phone interview from Al Khobar, in eastern Saudi Arabia, on April 4. “We expect to hear the news very shortly.”
Sinopec Corp setting up fuel oil, bunker arm -sources
BEIJING (Reuters) - Asia's top refiner Sinopec Corp is forming a fuel oil and bunker sales and marketing arm that aims to expand its market presence in China's rapidly growing marine fuel market, two industry officials said on Tuesday.
Vietnam to Be Handed Refinery by Builders in April
(Bloomberg) -- Vietnam expects international builders to hand over the country’s first oil refinery of Dung Quat this month, Vietnam Oil & Gas Group said in a statement on the government’s Web site.The state oil company, the plant’s investor, expects its contractors to provide a 24-month warranty period after handing over the facility, Tran Thi Binh, deputy chief executive officer of the company known as PetroVietnam, said in the statement. “Contractors will still take responsibility if any technical problems happen.”
Kazakhstan May Expel Foreign Workers From BG, Eni-Led Venture
(Bloomberg) -- Kazakhstan is seeking to expel workers from the BG Group Plc and Eni SpA-led Karachaganak venture, the central Asian nation’s second-largest producing oil field, for violating immigration laws.“We have questions on about 270 of the venture’s employees and have started by suing seven for receiving their labor permits and visas improperly,” Alexander Ogay, a senior official at the Prosecutor General’s Office in Astana, said in a phone interview. “The punishment for the violation is a fine and deportation, if the court upholds the prosecutor’s claim.”
Rudd Seeks Reasons for ‘Outrageous’ Ship Stranding
(Bloomberg) -- Australian Prime Minister Kevin Rudd said he wants to bring to account those responsible for the stranding of a Chinese coal carrier on a sandbank in the World Heritage-listed Great Barrier Reef.“It is frankly outrageous that a vessel this size could find itself 12 kilometers (7 miles) in the middle of the Great Barrier Reef, and it’s time we got to the bottom of how this could have occurred and to hold those who are responsible for this accountable,” Rudd said in the Queensland city of Cairns. He earlier flew over the Shen Neng 1, which ran aground on April 3, about 100 kilometers off the northeast coast.
Total Faces Investigation on Iraq Oil-for-Food Bribery Charges
(Bloomberg) -- Total SA, Europe’s third-largest oil company, was placed under formal investigation in February on bribery charges related to oil deliveries from Iraq.French Judge Serge Tournaire is examining charges of corrupting a foreign public official and influence-peddling, Isabelle Montagne, a spokeswoman for the Paris prosecutors’ office, said today, confirming information in Total’s annual review and reported earlier by Les Echos.
Tesoro Refinery Probe Homes in on Precise Site of Explosion
(Bloomberg) -- Investigators with the ChemicalSafety and Hazard Investigation Board say they have conflicting information about the precise site of a fire at Tesoro Corp.’s Anacortes, Washington refinery that killed five people last week.The safety board is trying to determine the cause of a breakdown that released a “fireball” that engulfed seven Tesoro workers April 2. Two workers remain hospitalized, one in serious condition and one who is critical, according to a spokeswoman for Harborview Medical Center in Seattle, where both are being treated.
Chevron: Ecuador plaintiffs’ lawyers lied
Oil giant Chevron Corp. said this week that lawyers for groups of people suing it in Ecuador turned in bogus reports to a court there in 2005.This is just one salvo fired in a long war between Chevron and various groups trying to hold it responsible for pollution in the Amazon rainforest. Chevron inherited these suits when it bought Texaco in 2001. Texaco worked in Ecuador and spent some $40 million cleaning up sites there afterwards.
Selling off our public assets makes no sense for Toronto: Many of them generate stable flows of revenue that the city will lose in these one-shot deals
The list of Toronto mayoralty candidates running from the conservative side of the spectrum is getting pretty long. Even longer is the list of public assets they are promising to sell off should one of them win the election.Toronto Hydro, the downtown heating and cooling system, parking meters, parking lots, garbage collection, transit routes, even ski hills and campgrounds have all been offered up by business-friendly candidates, all promising to downsize the city out of its fiscal problems.
An Uncomfortable Fact About Oil
What is the uncomfortable realization facing the president? It is the fact that going forward it is going to become dramatically more difficult for America to obtain and secure the energy it needs—and sooner than most people realize. It is a truth that policy makers and politicians are afraid to publicly admit because the implications of an oil-constrained world affect everything from stock markets and food production to the dollar’s status as the world’s reserve currency.In short, over the next several years, global oil dynamics may change the planet forever. And America will not be immune.
Fossil Energy Use in Conventional and Low-External-Input Cropping Systems
Conventional agriculture production systems in developed countries rely heavily on fossil energy, but emerging uncertainties in energy supply indicate a need to better understand energy efficiency in conventional and alternative systems. These researchers used 6 yr of data from a cropping systems experiment conducted in Iowa to compare energy use of a conventionally managed corn–soybean system (a 2-yr rotation) with two low-external input (LEI) cropping systems that used more diverse rotations and manure, but substantially lower quantities of synthetic N fertilizer and herbicides.Depending on how fossil energy costs were assigned to manure, the two low-external input systems (a 3-yr rotation of corn-soybean-small grain/red clover, and a 4-yr rotation of corn-soybean-small grain/alfalfa-alfalfa, used between 23 and 56% less fossil energy than did the conventional system.
Industries brace for peak water as peak oil hits
As though businesses didn't have enough on their plates dealing with peak oil in their strategic planning, production practices, and business models, now researchers from GlobeScan, after conducting a survey of 1,200 sustainability experts, have concluded that peak water is upon us and will worsen over the coming decade making every production process employed in creating the amenties of modern life more expensive.
Toyota faces record $16.4M fine in gas pedal recall
The government said Tuesday it has proof that Toyota knew about a safety problem involving sticking gas pedals for four months before it recalled vehicles and said it will penalize the automaker the maximum $16.4 million for the delay.
Newcastle Coal Exports Rise 24%; Ship Queue Shortens
(Bloomberg) -- Coal shipments from Australia’s Newcastle port, the world’s biggest export harbor for the fuel used in power stations, rose 24 percent last week while the number of vessels waiting to load declined.
W.Va. mine blast disaster kills at least 25
NAOMA, W.Va. — An explosion killed 25 miners Monday in a West Virginia coal mine and four others are missing, a federal Mine Safety and Health Administration official said today. It is the worst U.S. mine disaster since 1984.The blast occurred about 3 p.m. at Massey Energy's Upper Big Branch site, which was hit with $900,000 in federal fines in 2009 for about 500 alleged safety violations, Labor Department records show.
U.S. Lawmakers Raise Concern About World Bank Loan to Eskom
(Bloomberg) -- Three U.S. lawmakers whose committees oversee World Bank policy and funding asked the institution for more environmental and social commitments from Eskom Holdings Ltd. before lending the South African utility $3.75 billion to build one of the world’s largest coal-fired power plants.
South African Coal Plant Proposal Strains 'Culture' of World Bank
On Wednesday, the World Bank board is expected to vote on a $3.75 billion loan to help South Africa build a 4,800-megawatt coal-fired power plant. The plant will release an estimated 25 million metric tons of global warming pollution into the atmosphere. Its loan application has sparked some of the fiercest public outcry the World Bank has seen in years.Opponents are leaning hard on the United States to cast one of its rare but potent "no" votes, shining a spotlight on the secretive World Bank decisionmaking process, in which critical choices are made behind closed doors and, analysts say, diplomatic sensitivities mingle with an institutional drive to approve loans. Actual "yea and nay" votes, in fact, are almost unheard of at the World Bank, where the money flow is virtually always given the green light by a well-orchestrated consensus.
Tax credits for energy-saving windows, cars going strong
If your air conditioner sputtered and died last August, forcing you to buy a new one, you probably didn't clap your sweaty hands and shout, "Hooray! We'll qualify for an energy-efficient tax credit!"But if your new air conditioner uses less energy than the one it replaced, there's a good chance you'll be able to recoup some of your costs when you file your tax return.
Q.&A.: Transportation Secretary on Biking, Walking and ‘What Americans Want’
The United States transportation secretary, Ray LaHood, recently caused a stir when he proclaimed that bicycling and walking should be given the same consideration as motorized transport in state and local transit projects.Supporters, who continue to post notes of adulation and thanks on Mr. LaHood’s Facebook page, say the acknowledgment of biking and walking as legitimate modes of transportation is long overdue.
Critics, conversely, believe the secretary is taking the country in the wrong direction.
Digital Download: Join the Armchair Revolutionaries
Online social games such as FarmVille and Happy Island let players tend make-believe homesteads and islands. A new online site wants to take such social gaming tasks into the real world.Armchair Revolutionary (armrev.org), which launches Tuesday, adapts the features of Facebook games such as FarmVille and social networking applications such as Foursquare to involve people in social and environmental causes.
Transition Town, for when the oil is gone
Imagine for a moment Powderhorn neighborhood in the not so distant future; five, ten, maybe 15 years from now. Powderhorn Park is the vibrant center of the community. Part of the park has been transformed into an enormous community garden. Fruit and nut trees abound. Several folks are fishing in the clear, clean lake. The park building hosts community meetings as well as community theater and art shows. There is a community kitchen where people preserve food together. Cooking classes are held throughout the year. The park building has a tool library where anyone in Powderhorn can check out a rototiller, a saw, a snowblower or other items that people need (but don’t use often enough to justify everyone having one).
The Bright Green City: Alex Steffen's Optimistic Environmentalism
Cooper: So how do we start to build a sustainable society?Steffen: I think we’re still figuring that out. Big chunks of our infrastructure, our existing cities, our manufacturing base, and so on are radically unsustainable, but we have enormous amounts of money, energy, and materials invested in them. I think the most graceful solutions are ones that take what already exists and remodel it in a way that’s new, sustainable, and even charming. Retrofitting historic buildings to make them green, for example, not only conserves the resources that went into the building in the first place, but preserves the cultural identity of the building.
Of Biofuels, Land Grabs and Food Prices
Scientists still are trying to work out whether biofuels represent a significant savings in greenhouse gas emissions compared with fossil fuels, and whether the kinds of targets mandated by Europe will lead to a serious increase in global food prices.There are also conflicting views among experts about the benefits for countries where many of the crops are grown.
A Town Says ‘Yes, in Our Backyard’ to Nuclear Site
In most countries, of course, people would sooner allow a factory hog farm or garbage incinerator in their backyards than a nuclear waste dump. But in Sweden, SKB found 18 of 20 possible towns near proposed sites intrigued by their proposition. Then it had to whittle the list down to two, Osthammar and Oskarshamn, both already the site of nuclear plants....Claes Thegerstrom, a nuclear physicist who is the chief executive of SKB, attributed the new attitude of Swedes toward nuclear energy to fears of global warming. “In the 1980s nobody was mentioning CO2,” or carbon dioxide, considered the major cause of global warming, he said. “Now, it’s on the top of the list of environmental issues.” Since they burn no fossil fuels, nuclear power plants do not produce carbon dioxide.
U.S. Sued Over Nuclear Waste Fees
WASHINGTON — Sixteen utilities and a trade association sued the Energy Department on Monday to halt the government’s collection of nuclear waste disposal fees, arguing that the country no longer had a disposal plan after ruling out Yucca Mountain, Nev., as a repository.
The Smoking Guns and Blue Dress Moments of Climategate
The repetititve use of these phrases and cliches by deniers would probably make GOP wordsmith Frank Luntz proud. By sticking to a small set of familiar, eye-catching and dramatic-sounding memes, the denialosphere succeeded in getting many of the mainstream outlets covering the stolen emails scandal to follow suit by using the same language again and again.
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Good news everyone!
2 members of Congress have come to their senses!
Via:
http://climatechangefraud.com/climate-reports/6712-senators-question-fla...
I look forward to the data being corrected on Peak Oil and policy adjusted now that leadership wants an energy policy that is not based on flawed data.
Love to start the day with some good news, right?
Good news everyone!
Two republican Senators wrote to the wrong government agency (NASA vs. EPA) to announce their opposition to legislation they were expected to vote against, and filibuster, anyway!
I look forward to our grandchildren either drowning, starving to death, or killing each other for a bottle of water. Forget science and observation and peer-reviewed research. We have innuendo and irrelevant comparisons and repetition of talking points and repetition of talking points on behalf of entrenched business interests!
This puts me in an uncomfortable position of sounding like an EIA defender but here it goes. A rig drilling a successful NG prospect adds nothing to the county's NG production rate. A successful NG well that is completed and turned to a NG pipeline adds to the rate. An onshore discovery can take anywhere from one to three months to complete and install production facilities. Then add one to six months to connect to a pipeline and began sales. And obviously offshore is a whole nuther world. I can have a rig drill a successful NG well this month (thus adding to the NG drilling rig count) and then not see first production for one to two years.
Again, there can be many reasons to think the EIA lack credibility. But to be fair the time lag issue needs to be viewed separately.
also, there is or has been some curtailment going on which is also difficult to evaluate. curtailment is always there in the background, whether intentional or not - the not intentional part because of high pipeline pressure.
The Pension Land Model (PLM)
Once an oil exporting country peaks, the resulting net export decline is controlled by consumption as a percentage of production at final peak, the rate of change in production and the rate of change in consumption. Dozens of case histories show that domestic demand is almost always taken care of before oil is (net) exported, and the model and various case histories show that the net export decline rate tends to accelerate with time.
One of the biggest factors affecting government budgets--other than declining revenue--is unfunded and underfunded government employee pension obligations. I would suggest that before money can be "exported" out of a government entity, "domestic" consumption has to be taken care of first, which consists of current salaries & benefits and other costs and current and future pension (and health care) obligations. In many cases, state laws in the US mandate that pension obligations will be paid first. Many, perhaps most, governments--especially in developed countries--are seeing declining revenue and rising costs for current and retired workers. It only stands to reason then that we would expect to see an accelerating rate of decline in government services and aid to residents.
And the governments with the highest level of underfunded pension obligations and overall "consumption" levels at their respective revenues peaks would tend to have the most rapid rates of decline in government services and aid, e.g., California & Illinois.
I think it may be the opposite. As things get worse, governments are going to have to justify their existence by providing for their citizens. Tainter describes how the dole increased in Rome, even the ability to pay for it declined. By the end, one of out three citizens was on the dole.
What, pray tell, will they provide besides acceleratingly inflated and worthless currency?
If currency is so worthless, give me yours. :-)
The dole in Rome was a food allotment, and I expect that will be a big part of ours as well. There are already people living off food stamps.
I can give you the current of my thoughts, best I can do.
Food stamps are a currency, and as delivery of food declines, what is their worth?
I think it will be quite some time before delivery of food declines. At least to population centers; it could be argued it began declining years ago to isolated rural areas.
I don't deny the budgetary problems are ugly, but I expect BAU will totter on for far longer than many expect. You predicted we'd collapse by January 2010. Yet here we are, still arguing about it on the Internets. (Honestly, when TOD started five years ago, did any of us expect that BAU would be continuing, two years after oil hit $150/barrel?) When the financial crisis first hit, Denninger predicted that CNBC would be out of business in 18 months if the government bailed out the big banks. Yet eighteen months later, they're still on the air, celebrating the end of the recession.
Eventually, there will be hell to pay for the financial shenanigans. But it might not be in a time frame that current retirees have to worry about. The dollar is still the prettiest horse at the glue factory, and likely will be for quite some time. Look at how long it took for the dollar to supercede the pound.
Oh, I don't know, things can happen quickly sometimes due to the nature of the system. eg. Monsanto GM-corn harvest fails massively in South Africa
That article is dated last year (March 2009). It may have cost the farmers money, but it didn't seem to affect the corn supply much.
That's not the point Leanan. With a financial depression, Climate Change and Peak Oil, plus other sundries like water shortages, greedy corporations, scientific hubris and total ineptness of governments, the perfect storm is brewing for agriculture.
Just as portfolio diversification doesn't work in a stock mania, or geographic diversification in a housing bubble because they've effectively become one homogeneous system. Global agriculture has become one big homogeneous system and the confluence of events and internal dynamics can bring the entire system down as fast as any deflating bubble. It doesn't have to occur at the end of any period of time, it can happen any time, it can happen within one growing season and create empty shelves before anyone realises there is even a problem.
I don't think I buy that. It's a possibility, but after seeing what happened after the October 2008 crisis...I think we'll stagger on. We're just too big, with too much inertia, for a sudden collapse.
Yes, some areas of the world are vulnerable. The areas that have always been vulnerable will likely be more so.
But I think the run up in food prices, rice riots, etc. have probably helped. Countries are thinking about food security now, and I would guess China is no longer the only country maintaining a food reserve. I don't think anything will happen before anyone realizes there's a problem. Here in the US, we have a food surplus, and in addition, could eat lower on the food chain. If things get really bad, I could see the government taking over farms (and putting the unemployed to work on them). I expect if oil is scarce, agriculture will get priority. And the military, of course.
Complexity is repeatedly raised on this board as negative - due to the concept of the decreasing marginal rate of return formulation of Tainter.
However, there is another aspect as well, which is the resilience built into an organic market network which is more-or-less decentralized and not designed or controlled by any single human agency. TCP/IP networks have resilience deliberately designed into it. If certain routes become unavailable, new routes are discovered and utilized. The network learns which new routes are the most efficient and shift traffic in that direction. It doesn't prevent network outages, single points of failures still arise (especially on the edges), but it does minimize them and decrease the amount of intentional human intervention required to perform successfully.
As prices rise and resources depletion becomes known, investments in new technologies occur, people adjust their lifestyle decisions (move into the city or onto a farm, buy a different car, etc). The more time available, the more adjustments made, new 'nodes' are added into the system.
"TEOTWAWKI Peal Oil" narrative depends primarily on the idea that oil transportation is an absolutely indispensable component of the economy and which will become scarce/expensive so fast that our entire society/economy will have insufficient time to adjust, crashing the whole network.
I grant that, as producers and consumers, we are more inter-dependent than at any time in human history. But we also have a greater knowledge base to work off of than in any time in human history. I'm not betting on the hard crash. But I think it makes sense to invest in things/people/associations that make *your* local network edges more resilient. If the local WalMart is your sole source for food, if your local water and electrical grids are your sole source for those necessities, it might make sense on a local level to add in redundant capabilities. Not because of some great 'ROI' on those investments, but as a 'risk management' task.
Too many people look at the "system" and see some brittle, unchanging, hard-coded machine that breaks as soon as the first monkey-wrench is tossed in. But it's not. It is a flexible, organic network with millions of business connections that have become more reliable over time - not less. Granted - it has also become more dependent on oil over that time as well. The question becomes: is there enough time and enough investment available to grow in a new direction.
I'm not yet willing to call Tainter "wrong." But I think there is a dialectic between the 'costs of complexity' and the 'resilience of organic (free market) networks' which has not been fully explored.
(BTW, I'm just swimming upstream for a while. I think the US debt/continuing deficits will reduce our time and credit, reduce *our* ability to adapt over time. Of course, we sometimes forget that we are only a small percentage of the world)
It's not entirely negative. Indeed, Tainter's point is that complexity arises to solve problems. It works.
Have you read The Upside of Down, by Thomas Homer-Dixon? He writes a lot about complexity, efficiency, and resilience. His book is clearly influenced by Tainter.
Not yet.
Thanks for the tip.
Ron, I agree with you here. Doomers are romantics. Democracies are messy but create robust, tested systems. The model for collapse is based on a fictitious world without engineers. A nice, simple word that can be quantitatively measured to predict the future.
"a greater knowledge base to work off of than in any time in human history"
Good point, but knowledge has also been lost. As people moved off the land, fewer and fewer people grew up having the vast number of experiences and daily instructions that are necessary to be good farmers and stewards of the land. There is much local knowledge that is being rapidly lost that we may miss in an energy and resource constrained world.
And of course emotion plays a roll in what kinds of knowledge most people seek out. We have long been frustrated here that so few seem interested in gaining knowledge about resource depletion and other limiting factors that we need to be planning for.
Just saying the market and human ingenuity will take care of it seems a bit naive, especially given the behavior of the market recently.
Homogeneous systems have system points which can cause cascading failure throughout the entire system. In global agriculture there are system points too, its unlikely there isn't, even if we don't know where, we know they're there somewhere.
India has food surplus's too, held in their much vaunted reserves which they never seem to actually release, regardless of repeatedly saying they're going to. Sometimes what is assumed to be there, simply isn't:
Food grain rots in Punjab as prices soar
Maybe, but I now believe the chances of that happening are remote. If it was going to happen, it would have happened during the credit crisis.
Mmmm.
Yet, this will happen as a part of overshoot:
How sharp will our inflection be? How steep the decline? Will it be like the reindeer?
There will be more credit crises in the future and at one point a bailout will not work.
Then we'll really test the theory. The last crisis was a dodged bullet but that doesn't mean there aren't more bullets on the way. Assuming there will not be more crises would be like the conversation ThatsItTimeout and I were having. Many people think that because we recovered after the oil shock of the 70's the problem had gone away. Of course we know it hasn't gone away. Same thing with financial crises.
I am sure there will be more crises. Lots more, no doubt. One of the CNN talking heads predicted we'll have them every five years or so.
However, in the case of finance (unlike with oil production), all that really matters is that people believe things will work out. And because they did the first time, there will be a lot less fear next time.
Which doesn't mean bad things won't happen. I just think they'll happen slowly, with plenty of warning, rather than suddenly falling into the abyss.
I have to agree that there will be more crises, and then more, and more, and "the system" will stagger on through them, for a very long time to come. Until, that is, another crisis, one that is not really exceptional, trips "the system" and sends it crashing.
Stuart Staniford pointed me in the direction of a recent piece on collapse by Niall Ferguson, an eminent historian. The gist of it is firstly that "deep causes" of catastrophes aren't needed. For example, World War I was caused by a series of diplomatic blunders in 1914; it's not necessary to go back to the 1870s or earlier to look for the "roots" of the problem. Rome's collapse after 453 was caused by events in that year and immediately prior; it's not necessary to go back to 286 AD, or earlier, and say that's where the problem started. And secondly, that crashes happen fast when they come. The city of Rome lost three-quarters of its population in one generation.
I think that Ferguson is oversimplifying a bit. Yes, there are the crises that trigger events. But there are also long-running trends that progressively stress a system, so that it becomes "brittle". Then something that would have been shrugged off in earlier times suddenly becomes fatal. Thirdly, there are cyclical processes with different cycle times, and "one-shot" changes.
Examples.
These different processes can interact to produce ... nothing much, at the world scale. Or a blighted period, from which the world recovers. Or a crash. It depends. The chances of a crash go up with time, though, because of the trends.
On balance WNC Observer is right: this century will be one long exercise in giving things up. And you are right, Leanan: there will be plenty more crises. As time goes on, though, the chances go up that one of those crises will cause a crash.
And we've done precious little address the basic problems that caused the first crisis. Many people didn't survive the first crisis, economically or even physically. And of course the entire investment banking system did collapse.
The combination of less fear and nothing having been done to prevent another financial crisis (much less to prepare--or should I say 'post-pare'-- for PO) is not one that gives me great confidence.
But I agree that it is not likely that absolutely everything will totally collapse all at once. And, as here, the people that get through one collapse relatively unscathed, will look back a couple years hence and say, "That wasn't so absolutely bad"--right before the next step of collapse smacks them down.
If one builds the house on sand with no foundation collapse will happen.
Can anyone give a "label" to the present system? What is it "officially called"?
(vs an observered name of kleptrocracy or banksterism or .... )
The Ferguson piece was posted and discussed here when it came out.
And, well, I found it unconvincing. You pointed out the difference between his view and Tainter's, and it's a very significant one.
You're saying Tainter is right, while Ferguson's essay is arguing that Tainter is wrong. So you're saying Ferguson is wrong.
In which case, I agree. :-)
BTW...the link you posted is behind a paywall.
The entire article can be read here. It doesn't have the paintings, but you can find those via Google. They are fairly well-known works.
One should not forget that we all are becoming poorer as time goes on. The real wealth, sum of materials owned by people and govts is getting decreased in the product of quantity and quality (quantity x quality). May be the quantity is not getting decreased due to cheaper, low quality products from india (one example is unaudible accent of call center people) and china but the reduction in quality is more than the increase in quantity. One can calculate that on the basis of product-years a material work minus the downtimes. For example you buy a fridge at $100 and it work without major problems for one year, compare that with a fridge of same size at $500 that work without major problem for ten years, which of the two options is better is very easy to find. Just calculate per year cost of usage of a product.
In terms of money, one should not forget inflation, the printing of money by govt which take away both wealth and income from people. Looking at stock market figures, balance sheets and salary levels one should not forget to discount for inflation. Inflation figures told by govts are pure lie so only a fool can believe on that. My favorite is making my own currency one unit of which is equal to a certain amount of food and clothing at market price. Taking a basket of things seasonal inflations in a single item can be prevented from corrupting the data too much. I took food and clothing because after all these are the very basic items for which all of us work. Shelter is needed too but somehow people manage to live at any place, with a lot of difficulties and loss of productivity ofcourse but still they survive. Without food you can't survive and without clothing too in long term you can't survive (just wait for the next winter, rainy season or 50 degree celsius summer).
To be honest, and to make data reliable and meaningful historically one should take prices of consistent quality items in the basket year over year. One kg of genetically modified grain worth may be 0.1 kg of traditionally (without fertilizers, pesticides, tractors, dams and canals) grown grain.
The point is, at end of each bubble, wealth is destroyed. Wealth is not just transferred from the poor to the rich but it is also destroyed. In terms of purchasing power, quality of stuff etc people collectively become poorer, no matter how high stock markets go and what govts say. Wealth is a cushion from collapse, stopping it in best case and reducing its impact in worst case. When wealth get destroyed some of the shield is gone forever and society become more vulnerable to collapse. No society ever get collapsed in one single event. It not work that way. Its a consecutive and near-to-each-other shocks that first reduce the thickness of shield. Once the shield get too thin even a minor event can blow off the system.
I can give many examples. A slave rebel was once about to take over rome after defeating roman armies in several battles but rome still had some fat so it was saved. The wealth of rome got it loyalty from its citizens and they combined to defend it. Hannibal couldn't kill rome. Even over complexity didn't collapsed it in a single blow. Western roman empire started disintegrating somewhere in 6th century A.D. but still existed in some form in 14th century A.D.
Mughal empire got its first shock 22 years after death of its last great emperor when an irani king invaded and in a matter of an year captured half of the empire (afghanistan, nwfp, baluchistan, punjab, kashmir, sindh) and capital delhi along with the entire royal family, but that was not the end of the mughals. The irani king had to go back and mughal empire continued for another 128 years though in a weaker form.
Even a war takes time to kill an empire. Even after being captured if you used to have strength lately you would still have some of it left using which you can fight back. It usually take centuries to completely kill an empire. An empire is a resilient thing.
"If it was going to happen, it would have happened during the credit crisis."?
We're still in the credit crisis and its getting worse, money supply is still contracting and interest rates are beginning to rise. We're sliding into a global deflationary debt spiral.
BTW I wonder what the World's surplus food stocks are in reality, given the state of the World's No2 wheat producer's reserves pictured above. The World's No1 wheat producer (China) has also been found massively exaggerating is supposed grain surpluses too. I hope people don't look at the pictures of India's rotting reserves above and think it's just India so it doesn't matter, the World's two largest producers have been found lying about their reserves and I doubt they're the only ones.
Have you ever been watching someone run at full bore who gets tripped up by something tiny...they don't stumble much but can never quite get their feet back under themselves and eventually just land flat on their face.
One Nov. a few years ago, I was walking at a good clip and tripped on something about the size of my fist, I landed hard enough to fracture 3 ribs. When you take a breath and you hear grating sounds you know that a fall can be painful and not something you want to take again. More than one person has died from a simple fall while walking.
Just because we have all these built in layers of cushions, does not mean something big won't harm us.
Look at the weather in the last little while, massive snow falls, massive flooding. What happens when whole regions fall under the big weather events? Crop failures not just in one area but in several over one year can put a big strain on the stored food for the world's population.
Maybe I am just around more people that see the handwriting on the wall, but the general feeling I get from people I talk to, is when is the next big spill going to happen. I see the monoculture farming practices getting us into trouble reall easy, when it is tied into how weather can play out. I guess living most of my life in Tornado Alley can leave its mark. But it is the little things that can kill the system, if they happen all at once in a given time period.
Bee die off, sudden freeze, flooding, drought, Hurricane, EarthQuake, all in different locations, but all affecting the same system. My advice is don't bet on Everything you think you know, that won't or can't fail, but be mindful of what you will do if it does fail.
Most people can't live off their stored food for a whole year, most people have to buy food every week. Don't depend on the Gov't to supply you if something goes wrong, be proactive.
The old saying still sticks to me from hearing it long years ago.
Better Safe than sorry.
Charles,
BioWebScape designs for a better fed future.
Leanan is spot on. You will lose the ability to drive your SUV 40 miles to work long before we run out of food.
Moreover, it's quite impossible, as long as the sun shines, to run out of food. Unless of course we have a catastrophic climate event.
Sure, some people will starve, but not everybody will. I'm a doomer as much as anyone, but I don't understand the "human extinction or nothing" attitude. Even if 500 million humans survive, humanity marches on!
Moreover, it's quite impossible, as long as the sun shines, to run out of food.
1) Plant virus/fungus. UG99 as an example
2) one of the GMOed things gets loose. The soil bacteria modified to make alcohol is an example.
Good points, and what if you run out of arable soil or water (note the recent UN report on deserts covering 70% of the land in a few years).
Humans MAY survive, but none of us can tell the future. And humans are, finally, just one more species in a world where species are going extinct at a mass extinction rate--approaching 10,000 species per million per year above background rate.
It's hubris to think that we could never join the exploding ranks of extinction.
Let me respectfully disagree with 'the government taking over farms..' (sounds like collective farms...) Yes it is a warped system, but agriculture as presently practiced (massive uses of oil, fertilizer, irrigation and big machines) is an extremely complex undertaking. Taking away the present farmer and substituting government management and 'the unemployed' is NOT going to work..
The only way your scheme would work would be to give every unemployed worker two acres and a hoe... and everyone will absolutely starve...
Peak oil and agriculture presents layers of critical and alarming issues. As peak oil hits, even if ag received some sort of priority on fuel, there will be so many problems with allocation and distribution that I can see no way that overall production does not fall dramatically. As soon as peak oil hits agriculture we all need to be afraid.. very afraid.
There's a spectrum of ways the government could take over. From what they do now (encourage certain crops through subsidies) to ordering farmers to produce even if it's not profitable (what the Romans did, and done in some countries today) to direct takeover. It might not be more efficient than what's going on now, but it doesn't have to be. It just has to be more efficient than not growing any crops at all.
"Poor farms" were the way we took care of the poor, elderly, and disabled before social security. People were expected to work, as much as they were able. Most farms did produce food, but not necessarily enough to feed all the residents. But they didn't have to. Since those people were going to be fed anyway, any little bit helped.
Production might fall, but we have a huge surplus, especially if you consider the amount we feed to animals.
The big question is exports. During the last spike, some countries bypassed currency to trade petroleum for food directly. We might be having our own little Exportland crisis - with our export being food rather than oil.
Yes, I am more concerned about the Chinese, for example, buying up farm land (as they are around the world, especially in Africa) than our own gov taking them over.
I'm a bit surprised to hear you express that opinion Leanan.
Firstly: there is a massive difference between what happened 2008-present and the peaking of oil supply. With the financial markets, its all fake anyway. Fake money was magiced into existence to plug a hole the fake accounts of finance institutions who didn't even know how fake the fake numbers were. Result: confidence in the fake numbers was improved and the cost of confidence in the governments' fake numbers.
In contrast the supply of oil, a basic resource underlying so many systems in our civilisation, isn't fake. Its real and you don't get to play accounting rules with it to magic new resources into existence. The two are very different stresses on the system; one internal, the other external.
Second: What we saw was the operation of intelligent design to attempt to stabilise the financial system and stop it from crashing. They roughly managed to do this, but exposed the limits of their capacity for dealing with large scale system perturbations. Rather than having a fine scale understanding of the system such the small changes could have large effects, they resorted to old levers and large scale actions to attempt to force that system into the state they wanted. Even so they didn't really understand what they were doing, the consequences, how to unwind afterwards, etc.
Put that same level of ignorance on the deep seated system shifts induced by supply reduction and you can virtually guarantee that the wrong, short term, BAU focused actions would be taken. You've already seen a taste of it with blaming speculators when the price spiked, rather than asking the deep questions.
Its akin to balancing a stick on the palm of your hand - while its stable you're fairly OK, but allow it to fall out of balance for a short while and its very difficult to recover the situation. Actions push things too far the other way, perturbations increase and speed up, and quickly it falls.
Finally: You put some faith in the ability of societies complex adaptive system to find a solution. In fact many here are implicitly certain that the fix is to return to an agrarian existence - doing without and growing your own food Farmer Giles stylee. So just imagine that 10m tried to do that, all at the same time. Think of the systems of our society that rely on their efforts, their spend. Think of the ownership of land, the knowledge deficit, the sustainability of the sustainable meme. It would be chaos and would speed up the collapse.
Let lose, the actors in this society will follow attractors, but in doing so will help to destroy the stability of the existing system. Hitting that phase change in belief behind large scale independent action basically guarantees collapse, it doesn't avoid it.
So, your real physical drivers, centralised C&C that's not up to understanding the system and likely to perturb things badly, and CAS actors who will magnify effects rushing towards imagined solutions that cause bigger problems and fast falls.
Tell me again why from a system's perspective we will muddle through - given the dynamics and scale of the forcing function?
I was talking about the financial crisis.
Sorry, reading the original post and your reply I thought you were looking more generally, at agriculture, etc.
If you are saying that just the financial system can't collapse, well I'm not sure that's true either, for the reason I described. Fixes are done by rule of thumb from previous experience. Any experience outside that experience and the understanding isn't there to act smart enough or fast enough.
And the very fact that they had to intervene in the "free market" to keep it from destroying itself has lead many more to see the whole thing as the vast sham that it is.
Hence the Move Your Money movement: http://moveyourmoney.info/
(And note that this kind of thing is getting MSM attention, especially on public radio and TV.)
I'm saying a financial collapse sufficient to destroy agriculture is unlikely, given what happened last time.
I don't think mere oil depletion will be enough on its own.
Climate change and "peak water"...that's a possibility. But again, I don't expect that to be sudden.
The question was whether it would happen before anyone noticed there's a problem, and I think the only element that applies to is finance. Agriculture is well-monitored, if only because farmers want to know what to plant in order to make the most money.
Well, I think I'd half agree with you, and half not.
I don't think financial collapse will directly destroy agriculture, purely because agriculture would decouple from the financial system - becoming barter based. After all, it has real value to trade. Indirectly it can cause problems via fertiliser manufacturers and fuel becoming difficult to source. However food is high up the priority list, so provided nobody is dumb enough to run a 'market economy' approach, it will probably survive.
However, the 'anyone noticed' bit I feel is wrong. Its not a problem of attention, its a problem of understanding and using the wrong tool at the wrong time and making it worse. I don't think the total complexity of civilisations systems in extremis is at all understood, and I fully expect C2 actions to make things worse.
Take as an example the obvious solution to limits on oil supplies - rationing. We can expect all governments to go down this route, and to place certain usages on the 'reserved' list, getting first dibs on supplies. For everyone else that means much higher prices and problems in supply - eg Rationland.
However, fail to understand the connections in the system and some key group doesn't get supplies, can't do it's job; and creates a cascade failure from somewhere that is by definition unexpected. These can loop back through finance, which is effectively a black hole - probably via legal requirements for insurance and cash flow problems.
Maybe something like a programmer not being able to get to work, thus the SCADA processes don't get changed, so something blows up under the changed circumstances, knocking out a key infrastructure system, etc., etc., etc. In such a tightly integrated system there are a million and one such routes. Point is, continued oil supply issues reflect a systemic issue, pulling the system off balance in one direction all at the same time. Compare that with Black-Scholes and what pulled the finance market down and you can see the similarities.
Yesterday in a Bloomberg article an analyst was explaining why oil prices were suddenly going up. He said smething like "the fundamentals (ie supply and demand) don`t matter until they do". I was really struck by that sentence. So many times I`ve heard variants of it on TOD. "Until they suddenly do." That is the problem for us. We can handle some stresses until finally we can`t. That tipping point might happen suddenly without any warning. I have noticed a lot of "breaking points" WRT PO. The financial crisis was one such. As was the price of a barrel of oil.
For example, what if the price of oil continues to go up a lot then plunges in a crash like 2008? And then the supply of a lot disapperas without financing......Who will pump $30 oil out of the ground if it costs $80 to retrieve it?
Suddenly the fundamentals matter. Suddenly all the gas stations are useless and so are all the cars and trucks and supermarkets. An analyst will say, his dying words, "Oh, well, the fundamentals didn`t matter until they suddenly did..."
Suddenly there is no fuel to move any food anywhere. (Without warning, except for Stoneleigh, TODers, etc, that is, who have made repeated warnings.) People will be in shock I suppose and governments will try to do everything they can---we can only imagine the creative responses---but finally what will be possible will be very limited I believe.
I really am expecting something like this but I`m not doing anything to prepare for it because I can`t do that--I can`t go to that place and live simply off the land. I think I might be bored there or unsuccessful. Part of it is that my husband is opposed to any preparation. He said , "you can`t prepare for PO". I suppose taking oneself away from city life and competition is just too weird for many people. I accept that (for now); the future is so unknown anyway. I like my job too.
We will try to manage as things happen. I do expect a longish period of slow decline...it could be anywhere from years to decades. But eventually there will be something sudden. Then we will do something different, the exodus out of the cities will be steady. People will start to dismantle old buildings to retrieve green land again. I hope I will see it rather than waste away in the initial famine!
So, Leanan, I think you`re right and wrong. Something like another economic crisis might happen suddenly, it will be pretty difficult, the govt will try to help and the decline will resume at a slower pace.
There is an interesting post on Stuart Staniford's blog that hints that the 'financial shenanigans' may go on for quite some time, as long as we all pretend very effectively.
It's called 'Implications of Unmeasurable Capital'
http://earlywarn.blogspot.com/2010/04/implications-of-unmeasurable-capit...
I especially like Steve Randy Waldmann's term “Schrödinger’s Banks”
And it's posted up top. :-)
And yes, I agree. Especially since it didn't all go blooey in October 2008 - people aren't going to fear it as much the next time.
Yaa! As soon as I hit the go button the thought occurred to me, "I bet Leanan already posted this one." Sorry for being slow on the uptake.
Things really can change practically overnight. A string of bad financial news and "the herd" (i.e. us, me included) gets spooked.
What's underneath the whole system is trust and trust can vanish pretty quickly. It happens between married people, between countries and in financial markets.
Just one person too many has to start withdrawing his capital and then the whole edifice tumbles....The debts and shenanigans don`t matter until they suddenly do.......
"...people aren't going to fear it as much the next time."
You keep making this point and IMO it's the opposite. They will see that everything that was done, throwing Trillions at the problem, did not do anything but make it worse. I think it is very possible the public will loose confidence "next time".
and it's all about confidence.
On the other hand...
I wish you were right, but IME, most people see the bailout as working. They were against it when it was proposed, but now most think it was the right thing to do. So of course, they'll do the same next time.
Their (intended) worth is to prevent hoarding, AFAIK.
I expect the US will use two currencies, the dollar for 'big ticket' items like real estate transfers and food stamps.
Best bets: 'free issue' by the USDA, that is, no basis - fiat food stamps. Also, the IRS accepts them for tax payments.
That's why I think that we are headed toward something like virtual civil war--between current & retired government workers on one side and taxpayers on the other side, but in many (probably most) cases, governments don't have much discretion regarding government pensions:
http://www.huffingtonpost.com/2010/04/05/somethings-got-to-give-ma_n_525...
'Something's Got To Give': Massive Pension Fund Shortfalls Threaten To Bankrupt States
Can States go bankrupt?
Peter.
My understanding is that the answer is no, but they can default on obligations like debt service, but I think that many (most) are legally required to honor pension obligations.
They can't, and I expect that if necessary, the feds will bail them out.
They are limited primarily by their own constitutions as to what gets paid and what doesn't if the money runs out. IIRC, CA has a pretty ugly priority list.
The gov't will indeed bail them out if the gov't can still borrow, with the result being centralization of power. At the point that they can't, then who knows?
Perhaps a few states would consider defaulting instead of taking gov't dollars, but I imagine most won't.
This keeps coming up. States retain enough residual sovereignty to do sovereign default, they don't need a court's permission. Some states might have to amend their constitution in order to get out of their public employee pension obligations.
Given that state governments don't and can't contribute money to congressional, senatorial, and presidential campaigns, I wouldn't count on the feds coming forth with much bailout money. You've got to pay to play in that game.
The state governments can't, but the citizens of the states can and do - including the civil service labor unions.
But I think they'd be bailed out anyway. It would just be too disruptive if a state went bankrupt. Bad for business, you know.
Actually, it has happened. I know of the case of Indiana, which defaulted on its canal bonds back in the mid-19th century. They then adopted a new constitution that prohibited ever paying the bonds off. It ruined their credit rating, of course, and they operated on a "pay as you go" basis for over a century, at least. A state default would not be the end of the world, but it would be the end of borrowing for that state.
Without the states, the Fed Gov is nothing. The Feds will find any way possible to bail out the states.
Strange.
I was thinking the exact opposite.
What if, by whatever process, states lose sovereignty due to this collapse?
What you are talking about is regime change - the replacement of the present US constitutional regime with some other form of government. It can - and maybe will - happen. I don't know if the default of a few states would be the trigger, though.
Still, I would not like to be a member of Congress running for office -- and more so in the primaries -- if my state legislature and governor were actively campaigning against me.
Well, some governors (like ours in MN)--who have been railing against federal spending but are eager to accept anything the federal government throws their way-- would have a tricky time running against representatives who simply were more consistent in their ideology.
No more tricky than a family values party that has Vitter as a senator or worse a party that rails against govt spending but only after Jan '09.
When you have an absolutely disinterested and easily distracted citizenry, you can get away with murder.
Our Governor is a member of that party.
The sad fact is that the opposing party hasn't been able to put up any credible opposition. Maybe we need another wrestler.
Further, there are hundreds of billions of dollars of slack in the system. Start with the defense budget and cut it in half. Descent into oblivion can be postponed substantially if we start cutting things that are primarily the result of our corporate, military, industrial complex.
Chalmers Johnson writes about this in his trilogy.
In Nemesis he outlines that 25% (more now I bet) of the economy is tied to the military and if that comes to an end there will be economic hurt.
Unfortunately one citizen's slack is another's paycheck. How many people do you suppose garner a paycheck from the military-industrial complex? And the people siphoning up that money have shown themselves to be better at it than just about anyone.
Yes, just witness how hard it is to close a military base.
I suppose I am really talking about a net cash flow model. Gross cash flow would be tax revenue, borrowings, asset sales, etc. Consumption would be salaries, benefits, current and future pension and health care costs, debt service, government infrastructure costs, i.e., all costs needed to keep government functioning. Net cash flow, to be spent on services & aid to residents, would be the difference between gross cash flow and consumption.
Just as in the ELM, the trend would be for many governments to be headed toward the point at which consumption approaches gross revenue.
http://www.californiahealthline.org/articles/2010/4/6/study-california-p...
Study: California Public Pensions Underfunded by Over $500B
I think it needs to be kept in perspective that tomorrow's public employee pensioner is today's fireman plunging into a burning building or policeman responding to a call in a gang-infested neighborhood. How unhappy do you want to make these people, really?
I would also point out that societies that fail to treat their public employees as professionals and fail to compensate them fairly find that their public employees discover other means to obtain "compensation". People grousing about public employee compensation should give some thought as to what the alternatives are.
Another aspect of this situation to keep in perspective is who the taxpayers really are. The majority of the total bill for government is picked up by the most wealthy individuals and households. For the common person, the tax bill is much closer to the actual value in services provided. The rich are, not surprisingly, also bankrolling the "tea party" and numerous other anti-government/anti-tax initiatives because they know that in a democracy, they need populist protection. So, if and when we pit pensioners against taxpayers, we should try and keep in mind who exactly those "taxpayers" are.
Just one reference, here are the 2009 compensation winners among hedge fund managers, topped by David Tepper who took home $4,000,000,000 ($4 billion!) for one year's "work".
http://www.ritholtz.com/blog/2010/04/top-10-hedge-fund-managers-2009-sal...
How much does Mr. Tepper actually pay in taxes?
I suppose that states could set up a means test. If you are a large net taxpayer, you can't leave the state, but if you receive government benefits, they will be happy to send you on your way. Of course, I suppose that we would then see Berlin Wall like incidents, where wealthy hedge fund managers desperately try to escape high tax areas. I suppose then that the logical next step would be concentration camps, where wealthy people are rounded up and forced to produce.
Actually, this is why it makes sense for the feds to bail out the states.
The super rich pay a super tiny percentage of their wealth in taxes, especially compared to the 90% tax on the wealthy that was in place till a few decades ago.
The fact that this tiny percentage still adds up to a lot of taxes is some indication of just how obscenely and filthily rich the top .1% really is.
The idea that the dole brought down the Roman Empire is conservative nonsense straight out of the Cato Institute; 'beware of politicians bearing handouts'(scary), etc.
In fact the dole was brought on by mass hunger during the Republic.
It is more likely that the dole created and sustained the Roman Empire as the Roman people(plebians) traded their political power(a veto by tribunes) to the politicians and later the Emperor for a daily loaf of bread.
The dole was started in 123 BC. And covered 200000 people out of a citizenry of 5 million males(census under Claudius).
As far as I know, americans have not traded their votes for bread up to now.
Nobody said the dole caused the collapse of the Roman Empire. Certainly not Tainter.
Majorian, I definitely agree with you on that point.
Well we must disagree on that point. But you did preface it with; "As far as I know" and I must give you credit for that. You are obviously too young to remember the WPA, or the NRA, or the CCC. [NRA stands for National Recovery Act, not the gun organization. ;-)] Anyway all those programs, and several others during the Roosevelt Administration were all about bread for the huddled masses. And votes were delivered in exchange for that bread.
All welfare programs, food stamp programs and other such relief programs were delivered by congressmen in return for votes in their district. Even defense contracts and other government contracts in a particular congressman’s district or in a senator’s state, are a form of an exchange of bread for votes.
I am not saying that this is good or bad, just that such is the case. However many economists argue that, though there are many benefits of democracy, one of the serious faults with it is the fact that the citizens can vote themselves a share of the national treasure.
Congressmen promise it and the ones that promise the most usually get the most votes, and they get reelected only if they can deliver on most of those promises.
Ron P.
Unfortunately somewhere along the politicians discovered that borrowing allows them to sell tax cuts and increase giveaways, thus buying votes on both ends of the spectrum. Now we're doomed.
Naw, we ain't doomed! We got people over in the resource post claiming that $ is a fine way to model resources.
So as long as we gots us some $, we's got resources!
And don't forget the circus part. Our gov took a solemn vow not to raise any taxes ever for anything or anyone. He kept to that pledge (to the letter at least--he approved plenty of 'fees') in spite of crumbling infrastructure (including a world-famous, deadly highway bridge collapse) and debilitating cut back in everything from police and fire protection to library and hospitals to schools.
But there was one thing that he and most of his never-any-taxes friends in the legislature was more than happy to approve--a restaurant tax increase to pay a billionaire and his drug-addled millionaire players for a brand spanking new stadium where the hapless populous can drink themselves into oblivion and lose themselves in mindless admiration for hopelessly corrupt children's games for adults.
[/rant]
Nice rant dohboi!
If there is any denialism at TOD, it's denialism about the state of America. And it's no wonder - most of us are Americans and many here are part of the old guard who still remember American optimism, know-how, etc. And they still have some of that genuine civic mindedness and patriotism, not the Faux News type.
I can see clearly, though, that our society is finished. Kaput. How it dissolves is the question - peacefully, or violently.
"I can see clearly, though, that our society is finished. Kaput. How it dissolves is the question - peacefully, or violently."
Now there's the ole' American can do spirit!
RC
As far as I know, I don't believe 'socialism' as practiced by Otto von Bismarck (pensions) or National Health Insurance as practiced in the UK, Canada, Europe, Japan, etc. has resulted in national destruction, though the lack of a national health care system has almost bankrupted this country.
The WPA did create jobs to replace those the private sector destroyed between 1929 and 1933.
As the GOP-civil liberatian hypocrites like to say when defending against campaign spending limits, 'the people have a constitutional right to petition their representatives'. In conservative estimation it is more dangerous to give a down and out worker a job than millions in bribes.
Still, nice to hear you channeling Old Man Potter, Ron.
UK has similar issues with today's papers running columns re $1.6 trillion public sector pension 'black hole':
Public sector pensions: New warning from CBI
Unfortunately for penioneers, there is a lot of historical precident for reneging on pensions, so they ended up with fractions of what was expected.
Reneging would allow gov'ts to reduce their debt burdens.
In the United States, the only guaranteed retirement is that which people invest themselves via IRAs, 401k's, and 403bs' (that I can think of).
http://www.google.com/search?hl=en&q=pension%20reneging
WTI just broke through $87 a few moments ago. Pulled back a bit in the last couple of minutes but $90 isn't far away now.
The progression in recent annual lows, where we have seen year over year declines in annual oil prices, is perhaps even more interesting than the progression in annual highs. Here are three recent (post-1997) annual declines in US crude prices (note that the lows after 1998 approximately doubled each time):
1998: $14
2001: $26
2009: $62
We are so far seeing, post-1997, a cyclical pattern of higher highs and higher lows:
http://tonto.eia.doe.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=RWTC&f=A
The ratio from temporary peak to prior trough is pretty interesting too. Here are the ratios between discrete annual peaks and prior troughs:
2000/1998 Ratio: 2.1
2008/2001 Ratio: 3.8
Note that the ratio almost doubled.
A 7.0 future ratio given the 2009 trough of $62 would suggest a future peak of $434. As Matt Simmons has noted, many consumers pay (for refined product) the equivalent of $300 plus per barrel.
Sam plotted this pattern, using monthly data, but I wonder if an annual chart might be more meaningful.
Once again, great analytical insight from Westexas. Please post annual charts... It takes out so much of the noise and day-to-day sloshing and focuses on the underlying issue of liquid fossil fuel demand and supply.
This is the EIA annual crude oil price chart through 2009 (2010 to date is between 2008 & 2009). You can clearly see the progression of higher lows, from $14 in 1998, to $26 in 2001, to $62 in 2009.
IMO, the annual oil price data average out a lot of the trading hysterics and give us a much better idea of supply/demand fundamentals.
So evening out the recent gyrations and assuming we stay in the $80-100 range through the year, it looks like we have a clear linear slope, which by my eyeball should put is back above 100 in a couple years and near $130 in three. But more, and probably ever wilder, gyrations will surely persist, so predicting what happens in any particular year will get more and more precarious.
My pipe dream would be to see a boxplot of daily oil price aggregated by year. My guess is that an interesting exponential rise would show up, with both the mean oil price and the error bars.
Ditto for oil production- it might show some interesting trends.
"STOPPPPPPPP!" Note how current production levels were last applied to a price of $105/bbl; Feb production was 86.6 mb/d according to the IEA, which I didn't plot here. Staniford says the production rebound is almost entirely non-OPEC, thus the possibility of exceeding 2008 is worth considering. I pointed out that JODI numbers suggest that consumption has rebounded even more than production, even with a limited number of countries supplying data.
Gecko - don't know if this is what you're after, but: Plot of daily price volatility:
Neat, huh? Looks like an earthquake. This is only up to March '09, too, things haven't settled down.
Yeah, that is nice. I'd hate to see that kind of activity coming out of the Yellowstone Caldera ;-)
I think that if oil breaks $120 again, I'll start buying 1-year-out $60 put options with 10% of my modest savings on a ladder basis, on the theory that we'll have a series of deflationary episodes triggered when things get too frothy.
your mileage may vary....
I predict that oil prices will fluctuate--in a cyclical pattern of higher annual lows and higher annual highs.
I predict that my confidence in WT's predictions will fluctuate--in a cyclical pattern of higher annual lows and higher annual highs.
Now if we can just find that 10 mb oil field.
WT is high, agreed. ;)
Tentative changes in 2009 demand vs 2008, using JODI numbers and subtracting results from EIA's 2008 values:
The number for Egpyt just has to be a glitch. China contracting even a bit seems surprising but looking at Rembrandt's last OWM they did start out that year in quite a slump, before going totally bonkers from all that gov stim.
Will try to plug these into BP data and see how this compares to happenings 20 years ago.
Wait, what? We're down to millibarrels now?
;-)
"Now if we can just find that 10 mb oil field."
Why? What would we do with it? If the global warming/carbon release concerns are considered in any way accurate, finding more oil is a catastrophe compared to not finding it, and burning it would be essentially illegal.
RC
Easy answer TIIO: the more oil we find the less coal we'll burn.
And forgive WT's "mb". He's been hanging out at TOD so long he's developed bad habits.
WT 10 mb = oil patch 10 mmbbl = everyones 10 million barrel
That sort of thing is why the Canadian oil industry converted to metric. It's a 1.6×106m3 oil field. It's so much simpler that way.
Wouldn't that be 1.6Gl?
No way. That wouldn't be allowed. You have to use 1.6×106m3.
In the Alberta oil biz, we would have said "1.6 million cubes". And for gas we would use "decs" where a "dec" is 103m3. But that was our own jargon. To be officially correct in the SI system, you have to use exponential notation.
I have a solar panel question I was hoping someone on TOD might be able to answer...
I'm looking for a good panel set-up for "utility" purposes - i.e. powering rechargeable electronic devices, trickle charging 12V marine batteries, maybe powering mini-submersible pumps etc. Definitely don't need anything to power an entire house at this point - I'm just wondering what the most versatile / mobile set up might be for this kind of application.
Would love to hear anybody's recommendations / experiences - i.e. are there any manufacturers that people just really love for this kind of thing (conversely - any I should really stay away from).
Also looking at solar powered electric fence (primarily for pest control) - would appreciate any thoughts on this as well...
Thanks in advance -
Catskill
Catskill;
The panels themselves are pretty boring. As far as I've heard and experienced, they just work. Put them in Sunlight, and you get power.
If you're in the Northeast, as your Handle suggests (and I seem to recall?), you might look at the Alt Energy Store, in Massachusetts.. http://www.altestore.com/store/Solar-Panels/51-to-99-Watt-Solar-Panels/c... (That link is to the 50-99 watt panel page)
I have a couple Kyocera 130 watt panels, a Shell 40 watt (Discontinued), and a Chinese, 'Harbor Freight' 45w array of 3- 15w panels. If you buy panels, keep in mind that you may well like to expand the array, and to get a panel that you'll be able to get more of in the future. My Kyocera 130watts are great and still available, but the '135', slightly bigger brother to it actually sells for less now!
You might look at a little Sunguard Charge controller like this one, just for a small-scale setup. Make sure you've got an LVD option somewhere in the setup, "Low Voltage Disconnect", which keeps you from overdischarging your batteries. That and overcharging are the commonest way to kill of nice cells quick. Many Inverters do offer this feature, and cut off at 11 volts or so..
http://www.altestore.com/store/Charge-Controllers/Solar-Charge-Controlle... (about $99)
Good luck!
Bob
Thanks for the great info Bob - I really appreciate it...
I'll check it out and probably be sending some follow-up questions your way :)
Please do!
Catskill:
If your electric fence is to keep out bears, then you don't want the little fince energizers with the little solar panel on them. Those don't deliver enough of a jolt. You need to deliver at least 0.7 joules to deter a bear, the little units with the built-in solar panel only deliver 0.25 joules. Get one of the more powerful units (a full 1.0 joules gives you a good margin of error), and rig up a larger panel to keep a deep-discharge marine battery on charge.
http://www.freepatentsonline.com/6396239.html is a patent on the idea of hooking PV + charge controller + batteries + inverter in a mobile config.
Me, I like Outback units. But I also have a victor.
You can buy an outback pre-wired so all you'd have to do is build enclosures for it and the batteries.
Or you can go man-portable:
http://www.siliconsolar.com/portable-solar-power-systems.html
Any farm supply store will have a ready to go solar powered fencer.
What an excellent example of something that's too obvious to deserve patent protection. (Here's the full patent at google) You suppose I could get a patent for a similar invention substituting tracks, on a sleigh for "A plurality of wheels"?
Sorry, I just think patents should only be awarded when the idea takes longer to hatch than the time between the waiter bringing the beers and the first Pizza hitting the table.
Something you might look into is an electric golf cart. The golf carts are often very cheap when a golf course closes down. Mine is a 36 VDC unit and the batteries are 220 AMP deep cycle (~7000watts total). I rigged 3 130 watt 12 VDC PV pannels in series with a 36 VDC (actually max 42VDC) charge controller. For the output side I have a 3KW 36VDC => 110 VAC inverter. I have run all sorts of hand tools, welder, well pump, etc. Further the grandkids love it to run around the pasture. I filled the tires with slime because we are in a desert here. IF you need 220 VAC a simple step up transformer will do the job. Of course all this is not as efficient a some setups but I find it is very flexable. The batteries will last several years in light duty mode. An extra set of batteries (not filled with acid) @~$720 will last a very long time. Keep the acid in glass bottles with non-metallic corks.
Hope this helps. Lyn
In addition to people's personal suggestions, the magazine "Homepower" does reviews, and has many contributors that share their systems, and what products they use/recommend.
(http://homepower.com/home/)
"The Smoking Guns and Blue Dress Moments of Climategate"
For anyone who doesn't know the name "Frank Luntz" (may he live in infamy), he runs a company called The Word Doctors, which, according to Wikipedia, "specializes in message creation and image management for commercial and political clients".
http://en.wikipedia.org/wiki/Frank_Luntz
He is further known for being the first to rebrand "Global Warming" as "Climate Change" because it didn't sound as fearful.
"Although Luntz later tried to distance himself from the Bush administration policy, it was his idea that administration communications reframe "global warming" as "climate change" since "climate change" was thought to sound less severe. Luntz has since said that he is not responsible for what the administration has done since that time. Though he now believes humans have contributed to global warming, he maintains that the science was in fact incomplete, and his recommendation sound, at the time he made it.[5]"
"In a 2002 memo to President George W. Bush titled "The Environment: A Cleaner, Safer, Healthier America", obtained by the Environmental Working Group, Luntz wrote: "The scientific debate is closing [against us] but not yet closed. There is still a window of opportunity to challenge the science...Voters believe that there is no consensus about global warming within the scientific community. Should the public come to believe that the scientific issues are settled, their views about global warming will change accordingly. Therefore, you need to continue to make the lack of scientific certainty a primary issue in the debate, and defer to scientists and other experts in the field."[6]"
For those who can stomach it, there is more on Frank Luntz at Sourcewatch :-
http://www.sourcewatch.org/index.php?title=Frank_Luntz
He is further known for being the first to rebrand "Global Warming" as "Climate Change" because it didn't sound as fearful.
Intergovernmental Panel on Climate Change (IPCC), est 1988
Also, there's the journal, Climatic Change. The first issue was March, 1977...
E. Swanson
I'm not suggesting that the term "Climate Change" was never used before - what Luntz did was recommend that reference to "Global Warming" as a term was removed from the public/political discussion, and replaced by "Climate Change", since it could be viewed as more benign, less threatening - even a *good* thing.
This is a matter of record. He did some word-smithing, for the express purpose of downplaying the issue. Another part of the deliberate misinformation campaign.
In fact, I recall several people (including one female press secretary) suggesting that "Climate Change" could actually be beneficial to some. I suppose, if you like boats, that might be true.
There's an old saying : "It's an ill wind that blows no-one any good"
Oh, I understand what Luntz was up to ... and succeeded, although not quite the way he intended.
I used to see the "AGW was changed to Climate Change to hide the fact that its not warming" meme pop-up every few months on the political forum I hang out on. It only took a dozen or so posting of the IPCC establishment date to stamp that talking point out.
Now it has morphed into "Who's afraid of climate change? You couldn't stop the climate from changing even if you tried. It's always changing.". A point I grudgingly agree with, even when it is being promoted by AGW deniers to prevent action limiting CO2 emissions.
A few moments ago, the Canadian dollar reached parity with its U.S. counterpart (it has since slipped back somewhat). Forgive me for asking this, but does a strong Canadian dollar relative to the greenback have much of an impact on Alberta's energy industry, good or bad, or are exchange rates more or less a non-factor with respect to energy exports to our southern neighbour?
Cheers,
Paul
I think Rocky Mtn Guy will have the best insight on this, but here's my 10c(Cdn) worth.
The Canadian dollar is largely viewed as a petrodollar in world markets, so it has tracked the price of oil fairly well in recent years.
What this really means, is that if you see the loonie (that's a Canadian dollar, eh?) going up, chances are the oil price is too. And for the oil companies, much of their equipment cost (e.g. Caterpillar dump trucks, etc) is in US dollars, so some of their input costs go down, and others, like Cdn salaries, stay the same. From an international view, the value of their reserves is also rising.
As long as oil and the dollar are rising together, they benefits and costs partially cancel out, but overall, they are doing better.
Believe it or not, what is often a more discussed exchange rate related topic in Calgary and Edmonton, is that the rising dollar makes it cheaper for the two NHL teams, as they pay their players in US pesos. Unfortunately, none of that has translated into improved performance of said teams...
Now, as the Cdn dollar continues it's relentless rise against the US, and oil does the same, we will accumulate more and more of the US wealth. Then, when the Cdn dollar is worth $20US, we just start cashing in our national treasure (i.e. hockey memorabilia) and start buying up large tracts of the US (that don;t use much oil) and keep selling to the parts that do. Simple, really...
Thanks, Paul -- what you say confirms my thinking, although I confess my understanding of this industry and international trade and finance is tenuous at best. As you point out, many of the goods and some of the services consumed would be priced in U.S. dollars so a stronger Loonie is obviously beneficial in that sense. And if the product you sell is priced in U.S. dollars and this price is adjusted to reflect changes in the greenback's value, you're good in that respect as well. However, I wasn't sure if a falling U.S. dollar would negatively impact exports in any measurable way given that it makes petroleum based products most expensive for American consumers. And to the extent that exchange rates and world oil prices influence the general state of the economy, there too, the demand for oil.
Cheers,
Paul
Paul, the rising oil prices ceretainly do affect demand in the US, and that will be seen in reduced imports from places like Saudi, Iran and Venezuela. Importing from Canada by pipeline is far better than from anywhere else by ship. so as long as they are still importing any oil at all, they'll take all Canada can sell.
The real problem for Alberta is, that when oil industry is really making money (like in 04-08), no one else (who is not connected to it)can do so at the same time. The oil industry can, and does, outbid anyone else for services and materials. so the housebuilder in Calgary has to pay the electricians and plumbers enough that they won;t go and get a job in the oilfields, and the good ones have already gone there. The Tim Hortons and McDonalds in Fort Mc Murray were having to pay its staff $16-20$/hr to keep them - how much does the coffee or Big Mac cost then? How can you afford to buy it if you are just the checkout chick or taxi driver?
So you end up with rampant local inflation, and a transfer of wealth from those not involved, directly or indirectly, to those that are, it's a real problem.
The country that has the best solution to this is Norway, where they charge higher royalties, and invest all of it outside their country so there is not too much money chasing around the domestic goods and services. Seems counter intuitive, but it works, and avoids the bubbles.
Thanks, Paul, for this additional perspective. I was wondering if lower demand hurts all exporting countries more or less equally, or if pipelines and proximity to market might spare Canadian producers some of the pain. Presumably, the relative strength of the regional economies served by those pipelines will dictate this to a some degree.
BTW, the impact of Alberta's oil industry on labour markets is felt out here in eastern Canada as well. When times are good, our supply of electricians grows tight; conversely, when the oil patch slumps, the number of bodies chasing work increases rather dramatically. For purely selfish reasons, we don't like to see Alberta's economy overheat either.
Cheers,
Paul
Ahh, yes, the immigrant workers...First time I went to Fort Mac, seemed every 2nd person was a Newfie, even the waitress at Earl's. Some of the nicest people I have met, I must go there sometime, once I can understand the accent..
I would suggest that the Maritimes have a very good export industry in trade labour - they are all sending money back while they are in Alberta, but that doesn't help you when you are competing with oilfield rates for electricians!
It is certainly a case that in a shrinking market, those who are closest/easiest supply route have a distinct advantage.
As for the pipelines and things, they mostly run to the Chicago area refineries, but they can actually send Alberta crude all the way to the Gulf coast. Problem was, the refineries did not want heavy oil, so they (oilsands companies) had to upgrade it to light synthetic crude first. Now, the refineries will take the heavy oil directly, makes it easier to sell, but there is a lot of capex and jobs that have been lost from cancelled upgrader projects.
I would like to see it all refined locally (meaning in Canada), but that's not how it works. Irving refinery in NB is still importing middle east oil!
Would have been interesting if the prov/federal govt's had put an export ban on crude, so you have to refine it locally. They should do the same with logs, we send boatloads to both China and US (raw logs are NOT subject to the softwood lumber agreement, so it effectively transfers mill jobs from here to there).
In fact, I'm surprised Danny Williams didn't do that...
Thanks, Paul, for mentioning these additional points.
I worked part-time for a tug company when I was an undergraduate student. Almost every employee was from some small Newfoundland out-port and it took a good six months before I could understand half of what they said (even more challenging when you're communicating via a UHF set and Lord help you if you got one excited, because they all started talking like they were auctioneers and once that train rolled out the station there was no stopping 'er). But they were truly the nicest, funniest and most generous guys I've ever known.
Cheers,
Paul
Paul Nash,
I think most of your analysis is dead on, but it is a bit narrow to think of the Canadian dollar as "petro-dollars". Canada also has many other minerals of great value and the rising prices of metals must also be driving Canadian currency. It is more accurate to think of the Canadian dollar as "commodity dollars". Of course the history of commodity prices has been boom and bust, so what is good today...tomorrow who knows?
RC
Actually, the local media, and even industry, have referred to it as a petrodollar since about 2005
You can see a graph of Cdn dollar v oil price from 1995 to 2006 here
http://www.financialsense.com/fsu/editorials/dorsch/2006/0221.html
And from 07 to 2010 here
http://www.environmentaldefence.ca/reports/pdf/Petrodollar_Brief_Jan2010...
There is a pretty good correlation, and better than any other commodity, and quite different from natural gas prices.
I couldn;t find a graph comparing the dollar to the CRB index, but that would be interesting. I guess you could say, of all the commodities, oil is the one that is most important to the dollar.
A strong Canadian dollar relative to the American dollar is generally a negative for the Alberta energy industry.
Most of their expenditures are in Canadian dollars, whereas most of their revenues are in American dollars. This results in their costs increasing relative to their income, and that causes their profit margins to fall.
Also, a lower American dollar means that Americans will be able to afford less oil, which means sales volumes will fall.
This is bad for Albertans. However, it is going to be even worse for Americans.
RMG, this holds true only if the price of oil is steady (in US terms) , but it has risen as fast as the loonie.
I think the worst result for Alberta is the cancelling of all the upgrader projects, they'll still be able to sell what they can produce.
Paul, I think that what is really happening is that the value of the American dollar is actually falling in terms of what it can buy on the international market. The Canadian dollar is holding steady in terms of the international market.
The net effect is that Alberta energy producers are staying about the same, but American consumers are losing. If the Canadian dollar was really rising, it would be negative for Alberta energy producers, but in reality I think it's neutral for Alberta.
I don't think that cancelling the upgrader projects is that big a problem for Alberta. What I think is going to happen is that world demand for oil products is going to fall, which will create a serious global refinery overcapacity problem. Until the excess refinery capacity disappears, I don't think it's a good idea to spend money building more refinery capacity.
Thanks, RMG, for your take on this. Assuming the fall of the U.S. dollar doesn't impact local labour rates or the cost of Canadian sourced goods and services in any significant way, there still should be a net benefit with respect to goods imported from the U.S.. And Canadian manufacturers presumably import machinery and equipment, various sub-components and perhaps a portion of their raw materials that are paid in U.S. dollars either directly or further back in the supply chain. And to the extend that a stronger loonie hurts other Canadian exporters, this would take at least some pressure off the labour market. Lastly, as Paul mentioned above, crude prices tend to float higher in response to declines in the U.S. dollar, so there should be hopefully adequate compensation at that end of the equation. Of course, U.S. oil demand is tightly tied to the general state of the economy, and I'm guessing a drop in the greenback is, on balance, negative.
Cheers,
Paul
HiH, I think this is somewhat negative for Canada in that labour rates will tend to become less competitive in the global context. On the flip side, imported goods will become more affordable. According to the Globe and Mail, it's a great time to buy a Porsche if you can pay in Canadian dollars.
If you intend to travel in the US, which I intend to do soon, it's also a great time to be converting Canadian loonies to Yankee pesos.
The bad thing is that we seem to be ramping up for a repeat of the 2008 scenario: Oil becomes too expensive for Americans to buy. If Americans had the money, they would have bought from us. They have fewer options all the time.
Thanks, RMG. The boom-bust nature of the oil and gas industry wrecks a lot of havoc and I wish Albertans well as they ride that roller coaster. One of our recent clients operates an import-export business and in the back garage are a Porsche, Farrari and Lamborghini, plus two exotic brands of motorcycles I don't recognize (I take it business is really good). I was kidding him that the toughest part of his day must be deciding which vehicle to drive ... meanwhile, whilst he's busy doing that, I'm in my driveway banging the wheel of the Volaré, yelling "Start you bastard, start!".
Cheers,
Paul
Re: Tanker Rates Seen Sinking 35% Amid Refinery Cutbacks
4.2% (net) of the fleet vanishes this year as the last of the single hulled tankers are scrapped. And this process has been ongoing now since 2005.
This article significantly confirms other information that oil and products in storage around the world have substantially been used up. For all practical purposes, there is no meaningful storage left floating offshore around the US.
Yeah, but contango's heading up again, and Goldman still gets money for free.
Are you sure about that. I heard on CNBC this morning that the oil market is heading toward backwardation. Of course it is still in contango but it does appear that, averaged out over the last few weeks, the contango is getting smaller. Of course it all depends on your perspective. It did get a little larger yesterday, but that was only one day.
Ron P.
I wish memmel (who has not been around for a week) would check in on this issue of shipping rates, but I would not automatically assume if there is or isn't a contango in the futures market that offshore supplies are or are not being built up.
Considering that overall oil shipping volumes appear to be picking up in the second quarter over the first, the primary conclusion I can draw is that the 35% drop in shipping rates is mostly due to drops in storage demand. To a lesser extent, shippers may now be going on relatively shorter routes this year - that is the Far East as compared to North America.
In either case, the consequences for the US oil import market mid-2010 summer are quite poor, on the verge of being dire. At some point, the US will have to outbid Asia to take some supply share back. I am sure that some realization of that is already underpinning the oil market, and in the end, the US will not 'run out' of enough oil supplies for refineries - but at what price will we have to pay to keep the US oil/product distribution system smoothly running?
Link up top: An Uncomfortable Fact About Oil and a very uncomfortable fact about that uncomfortable fact.
How ironic that what the pentagon is doing, if it is successful and catches on with the rest of America, will not protect the environment but will insure its destruction. It is no secret that agricultural land and forest will be used to produce fuel instead of food, trees and wild animals. And of course as more agricultural land is converted to produce biofuel, more forest land, wetlands and such, must be converted to producing food.
I don't have the figures that tell me how much agricultural land and forest would have to be converted to biomass fuel production if we were to replace just half our fossil petroleum supply with biomass fuel, but I imagine it would be all of it, and then some.
Eric Sevareid: "The chief cause of problems is solutions." And this "solution" will cause a far greater proplem than the problem it was supposed to fix.
Ron P.
Well, Ron, there is current technology and then there is future technology.
I have absolutely no doubt that given time and investment,
that biofuel production can be made much more efficient through bioengineering.
We will have a new generation of biofuel bugs that won't need 100% of our foodstock.
OTOH, I haven't looked very hard at the soil depletion issue or the water resource diversion
required to sustain a long term biofuel economy.
On a side note, I find the DOD's influence on the economy over the last 60 years,
to be a largely overlooked aspect of our "free market economy."
Highway systems, computer technology, satellite communications, jet liners, nuclear tech, etc ....
Now the search is on for fuel and power alternatives. Change is a-coming.
Yes there is always a caveat isn't there. Given enough time and investment we might just do anything. But if the world recession gets deeper there will be little investment and as for time... you must be kidding. Sure, given enough years, and enough fertilizer and pesticides, we can increase the biomass yield per acre. But how many years do we have?
Of course change is a-coming, and that change will be nothing like the change the world is expecting.
The news just gets worse. Link up top: Of Biofuels, Land Grabs and Food Prices
By the end of decade we will need to convert farmland and forest land equivalent to half the size of Italy just to supply 10 percent of the transportation fuel for European Union countries. And that does not mention biomass for electricity. How much for 50 percent? In ten years the fossil fuel transportation fuel may just be down to 50 percent. And it almost certainly will be at that point in two decades.
The changes that are a-coming just seem to be getting worse and worse.
Ron P.
Govt targets are govt targets.
I suspect that they don't predict end-rates very well.
What they do is create a framework for govt investment.
I also suspect that we will see a mixed transportation economy - at least for 20 years or so.
More efficient gasoline vehicles.
More flexible diesel vehicles (inc biofuels)
Electric vehicles.
Nat gas/propane vehicles.
Hydrogen vehicles?
(and possibly a new generation of navy nukes)
Power down plans won't be entertained until the credit market crashes. (again, harder)
Granted credit towards the US could be withdrawn at any time. (sooner or later?)
Until then, govts will continue to fund projects hoping to clarify the way forward.
People don't just crawl into a hole and die when faced with an uncertain future.
Nor should they.
"Hydrogen vehicles?" If you are even halfway serious about that one then I cannot take anything you say very seriously.
Of course they do not crawl into a hole, they deny that there is any uncertainty in their future. They deny and deny until events, not arguments, bitch slaps them right in their face. They will accept that the future is uncertain only when that uncertainty actually arrives, like a sharp decline in the oil supply causes the economy to crash and unemployment to soar to over 50 percent.
Ron, the study of human nature is sometimes a boring subject, but I have found it often very alarming during the some 40 years I have been studying the subject.
Ron P.
The cause of so much human suffering is the lack of critical thinking skills. Well said.
If fuel cells do get to be more economical like the Bloom, it's more likely that they will run on natural gas directly, until that runs out.
http://www.wired.com/wiredscience/2010/02/bloom-fuel-cell/
Hydrogen makes sense if the world gets serious about AGW.
Ethanol is net energy positive( creating more fuel energy out than was put in)
and reduces CO2 and so kills two birds with one stone, but the total amount of ethanol is limited, so efficiency needs to be raised.
If cars averaged 40 mpg, the US would require 60 billion gallons of gasoline
or 83.4 billion gallons of E85(12.5 billion gallons of gasoline-1 mbpd?) plus 71 billion gallons of ethanol. At 71 gallons per ton of cellulosic ethanol that's a billion tons of biomass. The US corn crop is 200 million tons, the US wood crop is 30 million tons,etc.
The USDA outlines a biomass resource of 1.3 billion tons.
http://www.nrel.gov/biomass/pdfs/39436.pdf
Too much negativity, too few solutions at TOD.
No, it makes no sense whatsoever. Converting to a hydrogen powered fleet would greatly increase AGW if the electricity is generated by the same means as it is generated today, primarly from fossil fuels. And even if it is totally generated by wind or solar, batteries are still far more efficient.
Who Killed the Hydrogen-Powered Car?
As you can see, starting with 100 kWh, 23% of that is delivered as torque to the wheels using a hydrogen fuel cell compared to 69% in batteries. And if that 100 kWh is generated with coal, oil or natural gas, then the AGW would be greatly exacerbated.
Ron P.
To add to Darwinian's argument about hydrogen..
The hydrogen fuel cell has been under intense development for over three decades now, but none of the commercially available ones get 50% efficiency. The fuel cell concept cars average 25% cell to wheels efficiency, so we need a doubling of performance, and an order of magnitude decrease in cost, before they are a realistic alternative.
Their real world performance means you get about 10-12kWh of motive energy for the starting electricity, and if that came from a combined cycle gas powerplant (60% eff), then you are only getting 6% of the NG fuel value. Better to burn the NG directly in the vehicles, or convert to methanol, or use battery electric vehicles, than go hydrogen.
if we look at elec generation from coal (35% eff), then it is even worse, at just 4% of the fuel energy. A solid fuel powered steam car can get 15% fuel efficiency, and the technology has been around for over a century.
But NG is the fuel of choice, after oil. If we didn't use our NG for electric, there would be enough to power the (more efficient, and smaller) vehicle fleet for many decades.
First, I'm talking about natural gas fuel cells which are about 60% efficient.
http://evworld.com/article.cfm?storyid=1756
Compressing natural gas is much easier than hydrogen according to Ulf Bossel.
You could pipe that gas instead to a 50% CCGT gas turbine and then deal with a 20-25% distribution and battery inverter loss. It would seem to be less efficient.
If the renewable electricity is supplied thru central batteries, where AC is converted to DC and then DC to AC before continuing on to the charge point, the losses could be high; 100 kwh x 90% transmission x 85% AC-DC charge x 85% DC-AC discharge x 85% AC-DC battery x 90% = 50 kwh
A standard car at 20 mpg gets 2000 mi per ton of CO2.
A Honda GSX CNG car gets 28 mpge and produces 4170 mi per ton CO2.
Electricity from the current grid produces .7 tons of CO2 per Mwh and a Nissan Leaf EV gets 4166 mi per Mwh which is 5953 miles per tCO2; 100/(.7x.024)
A kg of hydrogen can be generated from 160 cf of natural gas by reformatting according to DOE. The CO2 also could also be be removed at the gas station for CCS.
A Honda FCX Clarity gets 68 mpkg and natural gas releases .052 tons of CO2 per 1000 cf of natural gas which is 8100 miles per tCO2; 68 x 1000/(160 x .053)= 8018 miles per tCO2.
Transport produces 40% of US GHG, while electricity produces about 43% of GHG.
We are suppose to reduce CO2 emissions by 50% over the next 4 decades.
As one of the few people commenting the need to reduce CO2 emissions, I think that given the science, CO2 will trump energy efficiency if real efforts are made to stop AGW.
Well no, you were talking about hydrogen fuel cells. You did not give even the slightest hint that you were talking about natural gas fuel cells. What you said was:
But then you said you were talking about natural gas and your link was about natural gas fuel cells, not hydrogen fuel cells. Then you wrote:
Now you are talking a combined cycle gas turbine, an entirely different subject.
Now you are back to hydrogen fuel cells again, and you are generating that hydrogen from fossil fuel!
Well the most immediate problem will be peak oil. You said hydrogen makes sense only if we get serious about AGW. My point was that hydrogen makes no sense even if you are concerned about AGW because batteries are much more efficient no matter how you generate the electricity.
Sure combined cycle power plants would generate less CO2 but that has nothing to do with hydrogen powered cars. And if we turned to natural gas combined cycle power plants for all our electricity plus natural gas for generating hydrogen for cars, we would run out of natural gas before we even ran out of oil.
I agree that a natural gas fuel cell is more efficient than a hydrogen fuel cell but you seem to be mixing the two. Actually I am not really sure what you are talking about and since you bounce from hydrogen to natural gas fuel cells, as if they were the same thing, I am not sure you do either.
Ron P.
Fuel cells basically run on hydrogen.
What do I mean by hydrogen? Hydrogen is created from the reformatting of fossil fuels, which like grid electricity and internal combustion engines produces CO2.
Also, hydrogen in most views would be produced in quantity, which actually makes CO2 capture easier. Also hydrogen can be made from water-shifting coal which we have two centuries supply.
The amount of primary energy(if depletion is your only concern) is less for
the fuel cell car at .61 kwh/mi--33.4/68x.8 than the Nissan EV at .65 kwh(grid)/mi--.24 x 2.7.
"Hydrogen can be generated from natural gas with approximately 80% efficiency, or from other hydrocarbons to a varying degree of efficiency."
http://en.wikipedia.org/wiki/Hydrogen_production
As was demonstrated by my calculation, if we want to choose the energy path that minimizes CO2 for production cars the best choice is a hydrogen fuel cell Honda Clarity over a battery car like the Nissan Leaf.
Given that renewable wind and solar amount to less than 2% of our electricity generation, batteries are going to be dirty power for at least a century.
The real point of renewables is to stretch out fossil and nuclear by a few decades.
Oil consumption has been flat for a decade but dirty electricity is growing strongly worldwide.
Not all of them. Some fuel cells run on natural gas.
We all know what hydrogen is. It is the most common element in the universe.
Well no, it is not. Hydrogen can be produced from the reformatting of fossil fuels. that process releases the carbon from the hydrogen and produces free hydrogen and CO2. Hydrogen can also be produced from water. That process does not create CO2.
You are joking right? Some claim we have two centuries supply of coal at present use. These people are sorely misinformed. Others claim that U.S. coal supply may last only 10-20 years
Nope, it just ain't gonna happen. The hydrogen car is dead and good riddance. From "Who Killed the Hydrogen Car" link posted earlier, written in June of 2008.
And the hydrogen car has not been resurrected. It is dead, dead, dead. Science has finally won over myth and silly hype.
Ron P.
DOE Hydrogen program is dead?
http://www.hydrogen.energy.gov/
http://www1.eere.energy.gov/hydrogenandfuelcells/events.html
Joe Romm? Dave Rutledge?
EIA
2004 2005 2006 2007 2008
1,112,099 1,131,498 1,162,750 1,146,635 1,171,483
Numbers of US coal mines rose 6.1% from 1374 mines in 2007 to 1458 mines in 2008.
EIA projection AEO2010 show coal and other fossil fuels increasing.
http://www.eia.doe.gov/oiaf/aeo/overview.html
I find it quite humurous that every time you get proven wrong, so very wrong, in an argument you simply change the subject and simply ignore everything that had been the subject, or subjects before.
You state talk about hydrogen, then produce a link that has absolutely nothing to do with hydrogen, but natural gas fuel cells, to show how efficient hydrogen fuel cells are. Then you have the aucacity to claim that you were talking about natural gas fuel cells all along. Then you bring in Combined Cycle Power Plants, as if that had something to do with the subject being discussed. It didn't.
Then you make the claim that fuel cells basically run on hydrogen, after claiming that you were talking about natural gas fuel cells and even posting a link on natural gas fuel cells.
Then I posted a paragraph from the article Who Killed the Hydrogen-Powered Car?
Meaning the millions once doled out to finance hydrogen fuel cell research had been cancelled. Then you post links showing that they are still hosting workshops! Like workshops has anything to do with the hydrogen car subsidity being cancelled! And as if that wern't enough you post links showing that coal use is increasing. Hell I could have told you that. What the hell has that to do with anything?
Okay, there are two types of fuel cells, hydrogen and natural gas. They are not related in any way except that they both produce electricity.
The fuel cell car is dead.
Combined cycly power plants have nothing to do with either hydrogen fuel cells or natural gas fuel cells.
Workshops are basically meetings where interested parties get together and discuss the plausability of this or that idea. They may or may not discuss the future of the fuel cell car but no one is going to get any grant money even if some of those in attendance say it is a great idea.
And yes coal use is increasing but we sure as hell do not have 200 years left, not even at current use. Not even close. But if we start to use it for generating hydrogen, or coal to liquids or even to generate electricity to charge battery powered cars, we will only have a very few years of reserves left.
Ron P.
Ethanol is a net-energy loser. Hydrogen is also a net-energy loser.
I think the 'solutions' come up quite frequently but some do not recognize them as solutions because they don't necessarily involve the delusion of technological progress. For example, using less energy is not deemed a 'solution' but an outrageous defeat by many. The goal of most people seems to be, like some sort of cosmic joke, to increase their personal entropy wake by continually increasing their personal energy throughput. Indeed, that is the measure of one's worth in corporate society.
What are 'solutions'? That is a matter of one's world view and a constant collision of opinion. I would argue that energy efficiency is the arena that has the most promise to 'save us' from the BAU path. Ironically, it would be helpful if governments, state and national, would lead rather than follow, but that would be idealist to expect them to do so. Consequently, those of us who understand the challenges ahead do our best to bring our own lives into 'transitional' projects. Besides advocating energy efficiency in housing, transportation, and agriculture, advocating renewable energy, advocacy in general, working with others at the local level is also a possibility for many not locked into survival mode. Transition Culture is an example worth noting.
Working on solar energy projects, rain water collection projects, home insulation, gardening, bicycling, networking... Studying!--these projects are fun and critical to our survival. Imagine if governments actually supported such projects instead of working for the coal and gas industries!
stiv:
Excellent points, all. Unless Americans grow up and stop acting like spoiled children, none of this will happen.
It's worse than that. Since the beginning of time, people have always competed with each other, primarily to win more-ideal mates for themselves and for their offspring. You won't resolve the stated problem with cajoling or mild admonishments as long as displaying a condo lobby walled with costly rare stone flown halfway across the earth and polished with diamond tooling gives the resident higher status than a less consumptive decor. And BTW, re. that 40 sq. ft. of granite countertop in the average modern kitches, one of the most popular materials, Black Galaxy, comes from India. Most others from China.
The obvious solution is to make giving of large gifts to the needy the most efficient way to gain status. Good luck with that re-education process.
As Richard Heinberg points out above, that was long the traditional way to gain status.
I'd still like to see some government make at least some attempt to encourage the process. How about some PR outfit being hired to figure out ways to meaningfully reward (other than financially) those who make non-balancing gifts to others?
Very complex. What I'm trying to get to is promotion of the ethic seen among the native americans of the northern west coast.
That ethic was likely seen among all humans before we got so complex. You reach a certain point, and one person can't give away enough stuff to reach everyone. That's when they switch to telling you that you'll get your reward after you're dead.
here are some simple numbers on how much biofuel can be produced.
With managed forests, you can get about 5t of dry wood per acre per year, with minimal input (i.e. no fertilisers, pesticides etc). With highly managed plantations you can double that, but, let's stay with 5t/ac/yr.
One ton has an energy value of about 18GJ -equivalent to three barrels of oil. You can actually convert wood to oil (or ethanol) by a few different methods. using Fischer-Tropsch, thr absolute best you could get would be one barrel of oil (6GJ) per ton, for a yield of 33%, and some electricity on the side (5% or so) with the wood itself supplying the process heat and the like (i.e. minimal external inputs.
The US currently has about 750 million acres of forest (USDA, 1997), so you could, theoretically, get a sustained yield of 5*750 = 3750 million barrels of oil per year, or about 10 million barrels per day.
Now, this is using every acre of forest (incl Alaska) and not one of farmland. This is also assuming all the forest can be accessed (it can't) , and that it can all produce at this rate (some more, some less). So, if we say that 50% of this is achievable, then we are using 375 million acres (more than current total cropland) to produce about 5mbd of oil, with a huge investment in processing plants, but little required in terms of fertiliser, water, etc
Once that investment is made, we would quickly decide it's better to put coal into them than wood, but that's a whole different story.
For comparison, the area of Italy is 75 million acres, and Texas is 175 million acres.
Any way you look at it, it is a lot of effort, and land, and capital to do this. Coal to liquids is only really viable at $100/barrel, and wood to liquids is probably at $150, though it is carbon neutral.
So, how realistic is (large scale) biofuel? Only when oil is so expensive that we don't want to use it in the first place.
Two points:
1) a minor quibble with your calculation, in that you've missed including the fuel inputs to the harvesting / chipping process. A large diesel tractor can haul out perhaps as much as 40 cords / day, burning 30 gallons of fuel directly and perhaps another 10 gallons in getting the operator and maintenance crews to work. With slashing, loading, hauling and chipping, say 3x so 120 gallons fuel to get 40 cords at 1 dry ton / cord, or 40 tons, yielding 40 bbl. or 2,000 gallons. With all other inputs, say 10% lost to harvesting and re-planting etc.
2) far more interesting than this calculation for the US would be the similar one for the world. No country could be an island in a world where this process made sense.
Len, yes I did leave out the input, and I had guessed it would be less than 10% (based on typical logging costs), so I appreciate you doing the real numbers on this. For a biomass operation, it could probably be optimised further, by direct chipping on site, etc, but I would still go with 10%
As for the world, well...
There are about 4 billion hectares (10bn acres) of forest worldwide (10% of that is in Canada). The tropical areas are much more productive, but we'll stay with 5t/ac (12.5t/ha/yr). Assuming we can utilise half the world forest area, we get 2bnha x 12.5 t.yr = 25bn tpy. If we convert to oil, at 1t =0.9 bbl (after harvesting etc) we get 61 million barrels per day!
Not bad, really, for using only half the forest area and NONE of the agricultural area. And sure would create a lot of jobs
Here is a good summary of the forest data.
http://www.earth-policy.org/index.php?/indicators/C56/
As an interesting aside, the area of the Alberta oilsands is 14 million hectares. if this was turned over to forest to oil production, we would get 14 x 12.5 x 0.9 /365 = 430,000 bpd from this area, indefinitely That is about 1/3 of current production, but it could continue indefinitely, and much of the infrastructure is already there...
I have to be skeptical of any claims of increased "efficiency" through bioengineering. We've been pretty good at transferring synthetic factories from one animal/plant/microbe to another, but I would like to see some examples of where human intervention has improved the energetics. If I remember correctly from a plant physiology class 40 years ago, a chloroplast converts about 40% of the energy of a photon into ATP--pretty damn sweet.
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2635718/
This is just the beginning.
The 20th Century was a Century of Physics.
The 21st Century will be a Century of Biology.
If the house of cards doesn't collapse.
There is some truth to the potential growth, but whether it is positive in impact is an open question.
The holy grail of micro-machines (and the whole nano-tech push) is to create self-replicating machines. Biologists pretty much start there. Putting the lid back on Pandora's Box once custom microbes become mainstream is going to be pretty hard.
What if you create a bug that is really good at digesting cellulose and providing oil, and it mutates a bit and decides to turn the trees and crops of the world to sludge in a period of six months?
Then we die.
Ice Nine, for those who have read 'Cats Cradle' by Vonnegut.
Or, "The Day of the Triffids" by John Wyndham
Or Zodiac by Neal Stephenson.
What if you create a bug that is really good at digesting cellulose and providing oil
We've been there, and (nearly) did that.
http://www.saynotogmos.org/klebsiella.html The idea was to make booze via cellulose.
That sounds like a really interesting organism.
Has there been any more research done on it?
I'd be particularly interested in simulated wild-ecosystem robustness of the genotype and effects on plants other than wheat.
What if some existing cellulose digesting bacterium out there mutates to become hyper-efficient on it's own and tries the same trick, only producing more bacteria instead of producing oil?
I don't think that the trees are exactly defenseless, and I'm sure that any bug we produce for this purpose will require that the cellulose feedstock be properly killed before feeding it into the bioreactor.
But even a GMO could be modified to do this. We are already playing with many very big fires on a number of fronts.
Cut the defense budget in half and then figure out how much fuel is needed for that. Get out of Iraq and Afghanistan and see how fuel we save from that. Quit trying to run the world from hundreds of foreign bases. See how much fuel is saved from that. The defense budget has very little to do with security and everything to do with the decades old control of the budget by contractors who stand to profit from same.
tstreet:
Fat chance. The U.S. emerged as the de facto global policeman after WWII, and the de facto oil policeman after the 70's. Nobody else is willing to do this - not Europe, not Japan, not China.
Which means that our boys fight and die so that the world can have relative stability and oil. Which means there will never be any defense budget cuts - until we collapse, that is.
Ditto.
See also:
The Carter Doctrine.
Reagan's Corollary to Carter's Doctrine
Project for New American Century
I wouldn't quite go that far.
Number of UK military deaths in Iraq: 179
Number of UK military deaths in Afghanistan: 280
http://icasualties.org/oef/
And here's an example of, in this case the US, acting as world policeman.
http://www.collateralmurder.com/
Saaed shouldn't have been hanging out with insurgents,you can clearly see rifles and in one instance an RPG. That video is actually pretty cool, it's like something out of an old Sci-fi movie.
And you remind me of something out of Dr. Strangelove to be honest. I suspect you may take that as a complement.
They mistook camera equipment for an RPG.
And how can you find it "cool" to watch children being shot?
At 3:46 of the short video you can clearly see individuals walking with an AK pattern rifle. At 4:10 of the short video, it appears there is an individual looking around the corner with an RPG. These people weren't college students doing a bar crawl, the "journalists" were embedded with insurgents.
It is cool in the sense at how advanced it is. Here we have a helicopter flying far away, perhaps 1500 meters and is able to engage a target with a a 30mm chain gun while the gunner controls the fire control system like it's a video game.
Wow someone had a rifle in Iraq. Better nuke the place. The RPG looking around the corner was a telephoto lens.
This is not a video game.
Right. If someone shoots you out of the air with an RPG in a video game you go back to the last save point.
The enthusiasm is distasteful, but the burden we place on our soldiers to kill people, survive, and exercise perfect judgement is much higher than we should reasonably expect of anyone.
The problem is not so much that a misidentification took place. I'm well aware that can happen. However the later shooting up of some random passing Iraqis displaying no weapons ,who had no idea that an airborne gun platform had them in their sights and were just trying to help an injured man, would appear to have been well outside of acceptable behaviour for an effective occupying power in a civilian area and likely also in conflict with the rules of engagement at that time.
Then the first US military personnel on the ground arrived at the site to find badly injured children among the dead and wounded and correctly attempted to have them immediately transferred to US medical care. That was over-ruled and they were instructed to just hand them over to Iraqi police. By this point, I for one, am disgusted.
Good for you, any sane person should be.
My point is that this sort of thing is inevitable whenever you start a war and happens much more often than you ever hear about.
We ask our soldiers to take on our insanity for us, then blame them for the tragedy that results. Once you teach a man to kill, to dehumanize the enemy to where he can kill and not become totally useless afterwards, what's a few women and children?
This is why there is no such thing as a just war, and why we should make damn sure that a war is needed before wading in.
There is nothing in the world more tragic than an unneccessary war, and no criminal worse than the one who starts one.
Getting back to oil, BP renamed it's Crazy Horse platform Thunder Horse after complaints from Native Americans that it was disrespectful. The US military, with no trace of irony however, apparently finds it an ideal callsign.
I wonder what the majority of Native Americans feel watching that video.
Btw I agree with your main points.
Uh, no.
"...so that the world can have relative stability and oil.."?
I don't see you Americans shipping oil to the impoverished masses with no money to pay for it(you're more likely to be taking the oil.) I didn't see you dealing with the genocides in Darfur or Rwanda.
A similar statement I couldn't fault factually would be:
"Which means that our boys fight and die so that we can have relative stability and oil."
Not nearly so noble.
And if you did cut that ol' military budget, and limit your insane and/or illegal military adventures, it would make it a lot harder to drag short-sighted Canadian politicians along with you. I'm for that.
LA Controller Greuel: City will be Broke on May 5 - Mayor Blames City Council
Yesterday I attended a lecture on campus entitled, "Is the Bounce for Real? The Recovery and
Why it’s More Illusion than Reality." The economist who spoke presented a clear assessment of the California economy, backed up by current economic data and attributed recent improvement to primarily Federal government stimulus. He concluded that, while the economy is likely in for several more years of slow growth, California is well positioned for economic expansion as "growth in the economy is a function of technology and skills," and that California had both.
In the Q and A that followed I asked him about the statement and the role of resources in the growth eqation. He looked a bit puzzled and asked if I meant capital. I replied that I was referring to water, energy, rare earth metals and the like. His response: resources are a function of technology, using resources more efficiently and coming up with replacements when needed.
It seems a good illustration of the disconnect from the natural world and a fundamental inability to acknowledge limits.
You are clearly a nut case. You are probably lucky that you weren't committed to a mental institution, along with various space alien cultists.
AY!
Yep that pretty much sums up his response - silly me.
You can bring data, graphs, pretty Powerpoint presentations, and even statistical analysis and make anyone beleive anything. However, without critical thinking about the events behind the fluff it means nothing.
Maybe it's just me, but I'm observing/suspecting that the more a person is prone to multi-tasking, the less likely/(?able?) they are to sit through and make connections between two seperate thoughts. For example, one multi-tasker I talk with doesn't seem to be able to make a distinction between 'energy availability' and 'environmental protection'. He simply interchanges one concept for the other. I talk 'PO' and he responds with 'recycling.'
Does multi-tasking diminish one's ability to understand one topic in depth?... conversely, does it emhance one's ability to handle many topics, but only with shallow understanding?
Do you mean multi- tasking in terms of knowledge or just the common tendency to try to do too many things at once. I think the lack of a basic understanding of how the world works (economics, geology, biology psychology etc.) is an obstacle to understanding the current challenges. The speaker was very smart, very well informed in his area of discipline but seemingly oblivious to the concept of resource scarcity.
I have seen the same thing in people who have an understanding of climate change but none of PO and vice versa.
just the common tendency to try to do too many things at once.
I'm not sure 'multi-tasking' gets specific enough to see a trend in this.
Look at Nurses v. Doctors in terms of perspectives. It's very possible to see things with TOO broad a lens, and also TOO narrow. I think the art form in all that is (spoken as a cameraman), to have access to your Zoom-controls.. to be able to go from Telephoto to Wide Angles, remembering one while looking at the other.
(I once or twice discovered how much this skill in my own mind was impaired by Weed. It was quite comical.. but probably only because I wasn't driving at the time.)
In a way, it's similar to my view about the ideals of the 'liberal' and 'conservative' parts of one's personality. Like a Human Hand, it is having BOTH the ability to 'Hold On' and to 'Let Go', AND the capacity to orchestrate these two, vital skills with accurate timing. It makes a game of catch look a whole lot different.
I think you are on to something. And, not too many receptionists have meaningful conversations with engineers :) (and, in my experience, engineers have strained relations with salesmen, for the same reason).
In an essentially stagnant or even slightly declining economy, the US government has enough weight to be able to force swings back and forth between "growth" and recession every few quarters. Why would they do this? To obfuscate, of course. Rather than things continuing on their dismal way, they get to crow about the "recovery" every couple of years, in between those unfortunate and "unforseeable" downturns. As far as the politicians are concerned, two sharp downturns in a decade, punctuated by "growth", would be far preferable to a decade of stagnation and slow decline. The first case fools most of the people most of the time; the second case fools no-one.
What I have just described is how the US economy essentially has been working for over a decade, and will continue to be working for decades into the future.
To immunize oneself against this sort of manipulation, you must tune out the short-term fluctuations, and especially the cheerleaders on CNBC, and focus sharply on the underlying long-term trends only. Regard the quarterly ups and downs as essentially being "noise", for that is very close to what they actually are.
I agree but the govt benefits (and they know it) from looking good or not so bad compared to other countries like Greece or the UK. Everything is relative in our world. If someone weighs 200 pounds and lives in a town where everyone else is chubby then that is different from being fat in a place where everyone is slim. So the US may well fall into another recession but so will everyone else. As long as the govt can convince people it is truly trying to turn things around then it doesn`t matter if it does or not for quite a while I think.
WNC Observer:
Excellent.
Read his post everyone.
Was he wearing one of those "Unobtanium" Charm necklaces that has become so popular with Economists lately?
Silly Rabbit! Didn't you know that "Natural Resources" are just a theory, and are only validated when a market valuation makes them real?
I keep thinking about this image I had in NY, where some people have put on these 'Masks of Civilization', like kids who might put on a costume in front of their parents.. and we are willing to be convinced that Mother Nature is no longer our prime 'source'. WE can be fooled by this pantomime, we fool each other and ourselves.. but mother nature sees through it all and smiles patiently.
From the physicist Richard Feynman, about 50 years ago "in the development of any new technology, reality must take precedence over public relations, because (ultimately) Nature cannot be fooled"
jokuhl,I doubt if Mother Nature will be smiling patiently for much longer.
One corollary of Murphy's Law is that Mother Nature is a bitch.If there is any smiling from that direction it will be one of contempt for half smart monkeys.
WE could be resentful at our actions. To Mother Nature, it's all good.
There is no punishment or evil. There is only the flow of energies.
Smile, it's a good day to die.
Nice story, klee, but you're wasting your precious time on this earth listening to economists, even if they lure you with catchy headlines.
Why bother trying to convince everyone of global warming? Its not possible to achieve anyway, so why bother? Letting those that refuse to assimilate the data collected in the field by climatologists to assert falshoods by virtue of what they believe or not should just be ignored. The only people we can rely on for information are those professionals in their field. If I need surgery, I go to a surgeon. If we need plumbing on the house I do it myself or call a professional. If we wonder why the ice in the artic is melting, then we must rely on those collecting data in the field.
Society needs to decide to just ignore those that refuse the information provided by the professionals.
The trouble is, the denialist entire effort is aimed at making as much noise as possible. They've become very good at spreading their anti-science message thru the Internet. Each new revelation, whether it's true or not, is blasted out to so many channels that the public confronted almost daily with their propaganda. They are being very successful, as evidenced by the rising fraction of the public who claims AGW is a hoax or worse.
The propaganda game worked in Nazi Germany and it's working in the US today. The denialist camp is successful because the politicians are letting them have their way with the media. There no fact checking before their message is blasted out, only later are the lies revealed. There's no accountability, no punishment for the professional liars. I'm afraid that the US will continue on this path until there's no doubt that the Earth is warming, by which time, it will be too late to stop. Out of ignorance, greed and hubris, humanity may kill the Golden Goose, ie, Mother Earth...
E. Swanson
Good point on propaganda E.S. I hadn't thought of it as a PR game of noise, but that is true. Too bad the media ignores credentials or lack thereof. The other day on a post here I equated the deniers to the person losing badly at tennis. The person winning just wins points and games but doesn't make a big fuss about it, but the loser when he does wind a point, like when ice extent recently came close to approaching the 1979-2000 avg., started fist pumping and yelling for all to hear. I suppose the media are like the trees watching the monkeys in the forest to report on which ones are making the most noise. No discernment is made to determine which ones are credentialled or which ones are collecting data in the field, just which ones are making the most noise.
I agree with you that one should be aware of which areas one has the expertise to really evaluate oneself and which areas one is relying upon experts, and in those cases listen tot the genuine experts. However, it appears that human psychology gets in the way again: The
http://en.wikipedia.org/wiki/Overton_window
theory says that most people tend to pick what they perceive as "moderate" opinions as what they think is "true", so by adding extreme ideas on one side of the range manipulators can alter opinions in the centre of the range. So if those experts who believe their data and theories support AGW stop trying to convince people whilst those ideologically opposed to AGW keep banging the drum, it's likely that some of the current "weak" public support for CO2 reduction measures will ebb away.
Of course sensationalism and the advent of testimonials to trump statistics are not limited to 'denialist' or 'manufactured doubt' groups. Lack of critical thinking, logic, and statistics in education seems to convolve perfectly with hedonism and flashy marketing in mass media.
Personally, I think an over-weighted time discount factor is the most endemic problem, visible everywhere from teens making hedonistic choices to CEO's pumping this quarter and politicians borrowing from our grandkids. The inability, or worse lack of desire, to adequately assign value to the future makes a poor outcome inevitable.
"The inability, or worse lack of desire, to adequately assign value to the future makes a poor outcome inevitable."
Nicely put (but it's too big for a bumper sticker or a sound bite, so no on will remember it).
Absolutely.
This is the reason why "socialist" Obama theme keeps churning - even though for all practical matter on economics he is just left of Bush (if that).
Society needs to decide to just ignore those that refuse the information provided by the professionals.
"Society" is largely composed of those people. Or at best they consider "professionals" to be whoever sounds most convincing on talk radio.
I, personally, don't really care about convincing people about global warming. I found that article interesting because it shows what we're up against if we want to convince people about peak oil...and also what we have to do if that's our goal.
Art the global warming deniers and the anti peak oilers the same crowd? If so, then it won't work. I'm convinced the global warming deniers are unconvincable, so if there is an equivalent for peak oil, then oh boy were in huge trouble.
I would say yes, they're the same crowd. Big corporations that are invested in the status quo, and will spend their millions to protect it.
But I don't think it's futile. Big Tobacco eventually lost the war over public opinion. (OTOH, there are some - mostly diehard smokers - who still don't believe cigarettes are bad for you.)
It is my opinion and observation that the tobacco change took one generation of people's worth of time.
It is also my opinion that peak oil will require the same. Folks tend to 'lock in' their worldview, and it does not deviate much. It takes a new generation to have a different worldview.
Leanan -- I don't keep track of Big Tabacco but last I read they were doing just fine. A growing cusotomer base, expanding markets in Asia, continued gov't subsidies to farmers (?) and good profits. Sure...lots of big headlines about huge lawsuit wins but the very significant reduction in awards by appeal courts don't get much coverage.
Maybe they lost the PR war but it hasn't seemed to hurt them financially. Or have I missed that part of the story? They still look like winners to me. Not only has the gov't not killed the tobacco indistry they are still a big beneficiary of the tax revenue from tobacco sales.
They're doing okay, aside from some big liabilities from lawsuits, and getting caught exploiting farm labor and smuggling cigarettes now and then.
When they saw the handwriting on the wall, they merged with food companies. I imagine Big Oil will eventually do something similar, whether it's due to climate legislation or peak oil.
The question wasn't whether the companies were put out of business, but whether public opinion on their products changed.
Plus, during the Bush Regime, they were part of finance that benefited most, along with extraction, arms, banks, drugs, and oil.
We will see how they do under obama, but their advertising departments could just switch to the anti global warming propaganda, and the cash cow continues. They were the pros of cultivating denial.
This bit piece from VK is something often misunderstood but we should understand it thoroughly. We are being screwed without the benefit of intercourse. Intuitively we know it. People are in extreme downer mood because of it.
http://theautomaticearth.blogspot.com/
A most excellent reality rant!
Say, that Clay Shirky article uptop about the collapse of complex business models is well-written, I hope folks read it.
I really like Clay Shirky. He's the one who wrote the widely linked Newspapers and Thinking the Unthinkable, which I found thoughtful and excellent. I don't think he "gets" peak oil, but I love the "big picture" view he has of things.
That was my favorite article of the day, too.
I've been noticing that in other organizations as well, the continued investment in complexity, and the inability to get simple things done quickly because of it.
I have been lurking around here silently for a while now, so time to step out of the shadows, I suppose.
I'm probably a little late to the game...
As of December 2009, I had very little awareness of the impending threat of Peak Oil. I know what the phenomenon is, but being a shameless capitalist (a product of the Thatcherite 80s), I hadn't given much regard to it. However, I am four weeks away from becoming a father now - a fact that I should be jumping for joy about. All was great - until I stumbled upon LATOC, that is. Now my outlook has changed - I am looking out across the London skyline at the moment and thinking 'how much longer will it all last?' I have given up trying to inform my family and friends - I feel very much like Cassandra right now!
Anyway, I have been reading the Oil Drum religiously for the past four months (as a Historian, reading's at least one thing I do well!). I realise I am in the presence of some tremendous intellects - some hopeful, others not.
I wanted to ask some advice if I may. I do have options. Although I am staying in London with my extended family now, I actually work in rural Devon, near Totnes, of 'Transition Town' fame. I was wondering whether to continue to live there, and hope that the relatively large swathes of Devon countryside will prove to be useful in the future. I don't mind back-breaking work - I was a construction worker before becoming a History teacher. The other choice is to up sticks with my partner and son and head to rural Ireland, with its relatively small population and very strong sense of community. My parents have a house on an acre of land there, surrounded by good neighbours with many other useful acres of land (the neighbours all have great practical skills too!). My father and I have both got experience of manual labour, and we will turn our hand to anything (especially if our survival depends on it!). My mother has also stocked enough food to feed a small army - not for fears over oil, but having learned lessons from her own mother's wartime experiences.
Sorry if I have rambled, or if this is not on the right part of the site, but these things have been pressing on my mind, and I would really appreciate some advice! Time, as we know, is a luxury we do not have.
Thank you,
John
Welcome, John!
Where to live? Your guess is as good as mine, but it looks like you're looking and thinking, and that's the best place to be. Devon sounds fine to me.. did you see this BBC film?
http://manchesterpermaculturenetwork.howcreative.co.uk/node/433
(That link's video isn't playing.. I think the BBC would like to be paid for their content, but a description is there.. I would bet you can find it out there)
(Careful about saying your can Mum feed an army. There might be some armies listening!)
"All the world will be your enemy, prince with a thousand enemies, and if they catch you they will kill you; digger, runner, listener- prince with the swift warning. Be cunning and full of tricks, and your people will never be destroyed."
- Watership Down - 'The Blessing of El-ahrairah'
Best,
Bob Fiske - Portland, Maine
Thank you Bob,
I'll keep my inventories on the down low then :)
It's strange - Peak Oil has been like an epiphany to me - if it weren't for the fact that I'm having a son, I probably wouldn't care so much - I'd just resign myself to my fate and go down fighting - to paraphrase Shaun of the Dead - 'I don't mind being eaten!'
John
John,
Welcome indeed. I suspect that if you are at the point of changing your life because of an internet blog site then you are suffering from shock more than anything.
I don't pretend to know the answers and there are a lot of sensible and stupid comments on this site - but which-are-which is not as obvious as it sounds. There is also a strong US slant.
I would arm yourself with a bit more background before you leap - I personally found that Greer's EcoTechnic Future was a much needed anti-dote to some folks here waiting for the world to end tonight. An historical context on people, money and energy, I consider the minimum. Many unique global events turn out not to be unique at all with enough history I found. Then again, the adrenalin buzz of an apocalypse is strangely addictive - I guess it is what many here call doomer-porn.
I suspect the reality will be neither BAU nor apocalypse but somewhere between the two extremes as ever. The trick, as I see it, is not burning bridges that you do not need to. To be honest, in one of the most densely populated countries on the planet, you would be very hard pushed to find a 'place' to go to that will fare any better than where you are now.
Best of luck with what ever you decide - and let us all know.
Thank you for a thought-provoking reply.
The option to move to Ireland has been on the table for some time now - my parents moved there in 2006, and have been asking me to go for some time. The UK will suffer some very hard times (I realise that Ireland will too, but there are a number of mitigating factors IMO), and I would get the chance to be with my parents as well as my own fledgling family.
You are right - I have had a severe shock to the system, but it's confirmed that I need to make changes - it has coincided with the opportunity to go to the Emerald Isle. Nowhere will be a perfect refuge, that much is definitely true, but I'd like to hedge my bets if at all possible.
John
The one thing that I'd say is that to make things work you have to pick a point between what you "ought" to do and what you "want" to do, because in all but real extremes you're better off doing something that's not "best" but which inspires you to put all your energy into it rather than "doing the right thing" but hating it so that it saps your energy. That's why I'd be a little bit careful acting immediately on an "epiphany" experience. As I tend to agree with what poeple like Leanan say about things limping on for longer than people think, I'd pick a situation you'll be happy with even if it things "just" get very slowly worse over the course of the next 20 years. (It sounds like you'd actually enjoy the Ireland life regardless so that's good, I'm just cautioning about making irrevocable decisions based on your immediate "emotional view" on things.)
Very true - I have tried to avoid irrational fear. I have my high and low days at the moment. My partner is a Buddhist, so tends to have a calm outlook on things. "It is your mind that creates this world" she tells me. I myself am not religious but there are some pearls of wisdom scattered about in scripture - more common sense than anything else.
I do not plan to jump in feet first (not yet anyway) - keeping an eye on things at the moment. As for the future - it could be unimaginably grim, it could merely be difficult, but it will most certainly be different. But who hasn't had to deal with that before?
Definitely don't panic over the info you see here. Remember, some of us started "panicking" around 5 years ago. It is best to study those that have been on the site for awhile (i.e. Leanan). TOD does change your perspective on everything, but most would agree here "Prepare for the worst, hope for the best". Preparing for the worst means different things to different people. Good luck and pace yourself when it comes to TOD.
*clap* *clap*
For what it's worth - aside from some obvious places that might not do well on a post-peak, cooked planet, like say the exurbs of cities in the desert - my general advice is to relocate to someplace where you can call home and really believe it- because then you can live, and die there. And I say that in a cautiously optimistic way.
A world of oil is a world of unlimited possibilites and expansion - flying across the globe, driving across the country, eating foods from far flung places, investing in businesses you know nothing about and expecting a profit etc. A world without oil is the opposite - a world in which you have to take sides.
The world becomes a much larger place, so to say, as your own horizons are becoming increasingly limited.
So pick a place where you can think to yourself: I can live and die here, and I will defend it if necessary (even hoping that it would never come to that).
John,
I too am a Londoner in a very similar predicament though I've been in it for several years longer than you. I've come to the conclusion that the only sane way to deal with this crises is through community. All this talk you hear of survivalism (mostly US based has to be said) is delusional imo. Human beings need community to survive and provide all the things and services required to live a decent life. So, wherever you go I think the quality of community you can rely on is critical.
My problem is that I can't think of leaving London. I get the heebie-jeebies if I'm out in the countyside too long. I've been spoilt by city life. I live near the river at Waterloo amongst the best galleries, museums, libraries, cafes, shops etc anywhere. I also find the local community to be rich and diverse and actually friendlier in many ways than from where I originate which is ... Ireland. Country life can be very claustrophobic if you are used to somewhere Like London.
One thing I have been doing is looking to co-housing as a possible balance between community and city life. http://www.cohousing.org.uk/
If you want to exchange further thoughts email me at art@nickstewart.org.uk
good luck ...
Stew.art,
I know what you mean about London. I was brought up in Dagenham, in the shadow of the big smoke. Granted there are some rough parts but I have had some wonderful times in the city. Just this weekend I went to an eclectic nightclub with one of my best friends (the London goth scene is fantastic imo - sorry to go off on a tangent!) and when I travelled on the tube early sunday morning, I had a really strong sense of being home. It is just tinged with a deep sadness that everything could come crashing down in the country of my birth.
As for Ireland, I know of many people who have come to the UK from there and who have never wanted to return, and they have cited similar reasons as yourself. I suppose I have been lucky as living in Devon has helped to 'wean' me off of city life (though I do visit Plymouth quite a bit) so it might make the transition easier. I do miss my friends though.
John
My email is john.caulfield@churston.torbay.sch.uk
John,
In am likewise here in the UK. I have been peak oil aware around 5 years. It is very hard to get through to family and friends who just don't want to listen. Where the safest lifeboat will be going forward, I think is anyones guess. I would love to self sufficient cut off from the rest of humanity, but ultimately family and community may be the best lifeboat.
One thing I would say is, no one knows how this will play out. The financial crisis that is morphing into a sovereign debt crisis is destined to throw up all sorts of dangerous wild cards of its own making. One thing is for sure we are in an historical transition period. Many things will effect the mid term future, Peak Oil being just one of them.
All the best in your planning and for your new arrival
Karl
Karl,
It is so true - family and community are key to survival, wherever that may be.
The UK does have a myriad of problems too, as you suggest. It's so surprising that we just keep limping along. I have been very fortunate to have a teaching job - I have managed to dodge the bullet so far!
John
Hello, John! Decide where (and with whom) you want your son to grow up. It will be his world that will experience the greatest changes, and a sense of "place" and belonging is important.
My humble advice is to put your feelings of insecurity on hold and enjoy the moments around the birth of your child. Don't let fear of the future cheat you of this sacred event. Then teach him to live a full, rich life on less. Teach him the difference between needs and wants. Simple skills, learning, and a strong, honest sense of history will provide context as he grows up in exciting times. Avoid too many distractions and keep things uncluttered, as clarity will be an advantage.
Ireland sounds good to me. Good luck with your new family!
Ghung,
Thank you for the welcome. I am fortunate in that I have a supportive family and network of colleagues. My school is doing sterling work on sustainability with the students. There are programs teaching students how to grow their own food - small-scale I know, but a start.
I do want to bring him up appreciating everything he has - I have had to fight hard for what I have achieved - one thing that worries me with many youngsters is a sense of 'entitlement' - mind you, in a society like ours, it's to be expected. I have rejected the consumer mindset and just want to enjoy the little things in life, and I want my son to do that too!
John
If your school where you work is teaching the things you say they are, then stay for a while, be a part of that, and learn as much as you can. Even though if I were you I'd move to my parents, I am not you, so take what I say with that grain of salt.
I am envolved with planting plants in more places than just my yard. I have two aunts still living in town that have paid for homes which have yards that can grow food on them, even if it is only a little. I advise people on what food plants to plant in their yards, what wild plants are edible and where to find them, amoung other things. So I would advise you to also find somewhere locally that you can grow food plants, sharing garden space is a good start, as not everyone has open land near them.
Your parents might look into finding more land around them for you in the future, if you can you might try to buy some close to them just as backup plan.
But with whatever you do, remember to smile at the life you see around you. At times if youve been reading four months my might have seen me be a doom and gloom kind of person, but at heart I smile everytime I see a plant growing somewhere, more so if I know I could munch on it. (those first seeing me walk around in the wild, wonder if I am a goat at all the plants I pick and munch on.)
Charles,
BioWebScape designs for a better fed future.
I was wondering whether to continue to live there
What's the water table like? Get that answered and you'll know to stay or try elsewhere.
If you can superinsulate and get passive solar to work, all the better.
One thing I have learned on my numerous travels to Ireland is that water is not in short supply. Even in AGW simulations it is not considered an area of 'water stress' - provided a pump could be rigged up on my parents' land, that shouldn't be a problem.
As for insulation, my parents were very lucky - they had the walls of their house ceramically injected - the heat stays in for ages. What was funny about it is that the guy who did it got the wrong address - he didn't charge my parents either!
I was annoyed at my Dad though - he switched from a wood/turf burner to a heating oil system - Duh! I have been putting pressure on him to change that.
Lurkers are always welcome, posters with a wide range of world views can only enhance the site.
Cheers on being a new father, and welcome to family of TOD.
I would think that within reason newcomers are allowed to ramble wherever they find themselves wanting to post, so no worries.
I would move to where I had land to own, Though if it were a desert I would have to have a lot more of it than I would if it were better watered. I would gather that you are younger than myself, as my parents grew up during the Great Depression and WWII. They have the same stock the place to the gills mindset, which at times can be a bother if you want to bring in something new.
LOL, just today while building something in the yard, my dad was trying to remember where the tools (hammers and nail pullers) all went, he got them from several different locations. I questioned him as to how many rooms did not have tools in them. I have a set of basics of my own in my bedroom, he has some in his bedroom, in the extra bedroom, the kitchen and 3 places outside. Tools of one sort or another in every shed we have(4), and every room. But then again my father is a jack of all trades Literally. There is nothing in the house that he can't fix.
So saying that, I'd lean toward being near your parents, though you might ask your partner what she thinks and include her in your thinking.
Prepare for the worst and pray for the best.
Charles,
BioWebScape designs for a better fed future.
Sorry Charles - didn't mean to seem ignorant but have been without internet for a few days - a glimpse of the future perhaps?
I am lucky in that my father is a very practical man, and he can also fix just about anything. I can learn a lot from him.
For the time being, I am stuck in Plymouth - it is a major port town (but also has the distinction of being the largest Naval base in Western Europe). I am just contemplating how much time I may have here before having to make a jump. Baby arrives on May 3. I sometimes wonder whether I did the right thing deciding to have a child, especially now I have a clearer idea of what may be around the corner.
John
Let's kill several birds with one stone. Here's the stone: electrified rail transit in and between all cities that would include bike friendly coaches and stations.
It could:
1. Save hydrocarbon fuel
2. Put people back to work making and maintaining it
3. Get more drivers off the road
4. Provide cheaper transport for people of modest means
5. Improve people's health by getting them to walk and ride more
6. Provide a market for recycled automobiles
7. Save lives and injury from auto accidents
8. Improve air quality and thus respiratory health
You missed one bird Kid:
9. Develop capital resources to fund the trillions of $'s to fund such expansions in a timely manner.
Electric rail was an even greater idea 30 or 40 years ago when we had time to start the transition. Lots of great ideas like yours on TOD for the transition...if there were just enough money and time.
Not only that, 30 or 40 years ago (well, maybe 50) was the start of the great suburban sprawl. Our cities, in their current form, are too spread out for rail to be really effective - you need to build a lot of rail line to serve the population. European/Asian cities, which are much denser, can use 1/3 the amount of rail to serve the same population.
So it's not just building rail, it is re-engineering the cities, the way people live and business is done, that has to go hand in hand. That is the hardest part - the people who live in the suburbs/exurbs are not willing to abandon them yet.
You two are going to have a very disappointing decade.
9) Allow dogs on the train.........................just sayin
The train now costs as much as flying. Diesel cars now can get over 45mpg. So even with 10 or fifteen dollar gas it's still a hard sell. Personally I think the emphasis should be placed on local public transportation. Intercity travel on rail hasn't been attractive.
DCM, I am with you about intra-city v. inter city. There is much better value for the dollar doing urban transit than inter-urban. The price of airfares will need to go up by 4-5x before people will take the train for any more than a few hours.
But doing urban is still very expensive. Our new train here in Vancouver, cost $2bn for 12 miles! We have very good density along its corridor, so that works, but there is still 70 odd% of the greater vancouver area that is not within two miles of a passenger train - still a long way to go..
if it had been done in reverse order - build trains first, then suburbs, the enhanced value of the real estate around the train would have paid for it, and development, both residential and commercial, would cluster around the stations, ensuring enough traffic to make them worthwhile.
I am involved in developing some more transit projects here in Vancouver, using abandoned railway lines and ROW's, so I hope to have a very good decade. But when you are going to do it, as opposed to talking about doing it, you have to face these realities, and they are not all positive. You end up doing the low hanging fruit first, which is the easiest to serve, densest neighborhoods - the rest will have to go without, unless they are prepared to pay for it themselves (which they never are). Just like mining the high grade ore, or drilling the best oil prospects - good ideas can only be implemented if they make real economic sense. And even then, as we know, some people with their own agendas can still block such projects...
France plans to build 1,500 km of new tram (light rail) lines in a decade, in every town of 100,000 or more (and some less than <100k) for 22 billion euros.
One key to their cost effectiveness is a willingness to take road lanes away from cars.
Best Hopes for equaling the speed and efficiency of French Bureaucrats,
Alan
The "one key" you talk about is not just one key but probably the most important, if the "the" key. Any serious commitment to mass transit would include making it increasingly difficult and unpleasant to drive, including making it more expensive to drive. This would be the policy in a sane world, which, apparently, can be found in France.
This reminds me of Denver where they spent billions on light rail and extra auto lanes simultaneously. Let's build light rail but at the same time, let us make it more pleasant and faster to drive. Dumb,short sighted, and maybe even corrupt.
Alan wrote;
"Best Hopes for equaling the speed and efficiency of French Bureaucrats" Normally I would say that is a contradiction in terms, but maybe not in this case.
When it comes to building rail, I am a big fan of grade separation. Streetcars and trams are nice, but if they are in the street, taking a lane away from traffic, you don't get as much benefit, in my opinion, not for mass transit anyway. Once your car frequency starts to get up to 20+ per hour, then you run into traffic problems at level crossings.
I don't think it is necessary to make it difficult to drive, it is better to make it where people want to take the train. Eliminating lots of parking is a good one for that, and makes the streets dominated by people not cars. I guess this is still making driving "less convenient", and that is fine, as long as people get something in return, like good/fast/clean/reliable rail service, and a pleasant place at the end of their journey. What I saw in Portland fits that model, when i lived in Sydney everyone knew that if you could get across the harbour bridge by train instead of car, then you do so. So too in London, there was no point driving or even owning a car. That is a major culture change for most American (or Canadian) cities, but I think young people in particular, will welcome that. They have seen the status quo, and have little desire to perpetuate it.
One thing I would be scared of in France, is a mass transit strike, they tend to do things like that. once you make your city train dependent, that sort of thing can't be allowed to happen.
My regular experience of trams is in Oslo and there are many streets where they co-exist quite happily with cars, particularly where they are running at maybe every 5 to 10 minutes.
I think that there is a quick and dirty 80/20 approach consisting of rolling out ultra-light rail (ULR) tram look-alikes running on (say) biogas or compressed natural gas.
That way you don't have to reinforce the roads for heavy electric vehicles and string electric cabling plus sub-stations etc all over the place. This infrastructure has accounted for a very large part of the astronomic cost and delay close to me in Edinburgh where they are building the first tram line.
Also, you don't get thermal losses from burning carbon fuels for the electric supply or transmission losses in distributing it.
I think CNG/Biogas ULR streetcars could be quite a neat hybrid, actually, certainly during the transition. Quick and easy to install, pretty good on carbon use and getting the benefit of low rolling resistance of steel wheels on rail as an advantage over buses and trolley-buses.
Houston is that way. Their light rail shares the lane with cars, at least part of the way. It seems to work well for them. They have a special light that turns on when the train needs the lane.
Chris, I'm not saying they can't co-exist, I am saying you don't get a very high capacity system that way. You are better off than buses, but if you have taken up a lane of traffic to do so, not by that much. However, lots more people, myself included, will ride a tram rather than a bus.
One 70 person (seated +standing) tram every 10 minutes is only 420pp/hour/direction, 800 at 5 minutes. Go to 2minutes and you have 2100, and you are causing traffic jams along every level crossing. A grade separated train can do up to 10,000 people per hour, with no traffic interference and faster travel time.
Streetcars are a better small town/neigborhood solution, but the longer your routes, and the more ridership you want, the less effective they are compared to a train. Now, that doesn't mean trains, or streetcars, have to be "heavy" , I am an advocate of exactly the opposite, ultra light. My point is that the real benefits are achieved, in a busy/large city, by grade separation (which can also be a dedicated, non car right of way). With the trains freed from traffic interference, they are much more productive. if you are trying to get thousands, or tens of thousands, of cars off the road, you need to get that many people onto something else. The streetcars are fine for the people who ride them, but they don't solve the problem of a choked three lane road, there is just not enough capacity. In the worst case scenario (gridlock) they can become just as stuck as anything else.
You can have both, of course, and many cities do. Here in Vancouver, they elected to go with overhead wires and electric trolley buses running on normal roads - the opposite of your idea. Possibly cheaper to implement, and buses can handle Vancouver's hills easily, but they are not as nice as streetcars. Would be interesting to know the comparitive costs of these - Alan?
The French typically just take a lane away from traffic (a la St. Clair in Toronto) for a private ROW, but that is "too much" they put either cobblestones or rough concrete in the tram lane and a smooth surface on the other lanes, "inducing" cars to not get in the tram lane.
Grade seperation is simply "too much" for smaller cities (say <1 million).
Best Hopes for French Bureaucrats,
Alan
BTW, it is often a month or two shy of 4 years from an arm wave "build a tram line here" to ribbon cutting in France. A mayor is elected on a promise and cuts the ribbon just before re-election.
Alan, when Calgary built its LRT (light rail train) before the 1988 winter olympics, it was a population of 650k. It is a mostly grade separated system, with only a handful of level crossings, and runs along a car-free street in downtown, so I will call this a separated system (though it is often at same grade. The system is a three leg system with a total of 30miles of track and 26 stations.
It now has a ridership of over 250,000 rides per day, assuming people ride it in and back, that is 125,000 people per day, or 12.5% of the population. I can;t find the statistic, but it is something like 30% of downtown workers take the train. it has one of the highest riderships of any north american transit system.
. It has been a resounding success, and I would think, much better results than a street car system - you would need a lot of streetcars, and more lines, to move that many people per hour. Yes, there are a million people today, but when it was built with 650k it was an instant success.
I am not saying Calgary is perfect, either, they could have made the system better, and serve more areas, which they will do now, after the fact, at great cost. But I will maintain that you don't need to be that large to justify it. Many British cities of 200-500k have their own train systems - though admittedly not all grade separated, but there seem to be very few level crossings in towns.
You could do a separated system if it was planned in from the start, but how many cities do (did) that on this continent?
I do like the four year period - has that ever happened on tis side of the pond?
BTW, it is often a month or two shy of 4 years from an arm wave "build a tram line here" to ribbon cutting in France.
Never happen here in the USA. Regardless of the nature of a project, we're obliged to spend 100 years hearing out to the bitter end the maunderings of every petty p*ssant NIMBY who comes stumbling along...
Alan -- Not taking advantage of existing roadways for rail was a huge disappointment here in Houston. The I-10 west of d/t Houston (a very major commuter route) was expanded at a great expense. Expansive toll road built down the middle. Same thing for a major route on the SW side. It could have easily been designed for rail instead. But this is Texas and you'll get us out of our cars when you pry our cold dead bodies from of them.
That's one of the advantages Calgary has had building its light rail transit system. They started in 1981, and knew where they wanted to run the lines, so they just reserved space in the medians of roads. When they actually build the line, it's a relatively straightforward process of putting down gravel in the median and laying the tracks on top of it.
However, if there is an existing railroad right-of-way, it's even simpler. The ROW is at least 100' wide, so it's quite simple to lay a couple of LRT tracks next to the main line tracks. Since the city takes over maintenance of the whole ROW, the railroads like this idea.
Calgary's light rail system is carrying close to 300,000 people a day now. It's down a bit from the peak of oil activity, but they're building a new line to the West, which should be completed by 2012. It's a bit more complicated because there are no railroad lines or freeways to take advantage of near the route.
Rocky -- They did the same set-asides here on all the freeways. Unfortunately with only autos in mind.
10. Be able to transport food and critical materials without oil.
11. Create a long lived, productive asset.
Best Hopes,
Alan
"The predominant moral issue of the 21st century, almost surely, will be climate change, comparable to Nazism faced by Churchill in the 20th century and slavery faced by Lincoln in the 19th century. Our fossil fuel addiction, if unabated, threatens our children and grandchildren, and most species on the planet.
Yet the president, addressing climate in the State of the Union, was at his good-guy worst"..........
I believe we will see what he has planned after the midterm elections. The double problems with energy and climate are too important. Obama doesn't act fast, but he does act.
Problem is that democrats will be decimated at the next election. The time, if ever, is now. After the mid terms, he will trim his sales even further getting ready for his hoped for reelection.
Whaddya mean, doesn't act fast? He's simply failed to get his actions passed, until healthcare. Now he has some momentum, but his window closes in November.
Here you hear about nutcase tea-parties full of right wingers, but in actuality many are Inds and Dems, and while you hear a lot about the Tea Party meetings you here zilch about Move On getting large counter-demonstrations - maybe a dozen folks here or there.
Incumbents should be sweating, for both major parties, but today the Dems are in line for the more significant losses, IMO.
I am not sure why Colin Campbell, whom I greatly respect, suddenly has said oil will never exceed price of $100. Even though that appears to be a sentiment shared by many here, I think the idea of a price limit to oil to be totally wrong. Perhaps better said, it is not really an important issue.
More to the point, the problem in the post peak era is adjustment to lower supplies. Outside of the US and a few other countries, $100 oil is not a serious problem to growth. So I don't see the price being limited to $100 just because $100 or higher oil may put the US back in recession.
While I surely think that the whole financial system is becoming more unstable over time, and when oil gets over $100 again a new period of financial instability may ensue, it will be because of falling oil supplies and not the direct impact of high prices.
If there was a strong and quick feedback mechanism from price alone, we would have never have gotten to $146 a few years ago.
I also agree with Stuart Staniford's article in that 'deflationsts' are wrong, and the economy will not blow up and implode - at least not yet. I see the possibilty of a deflationary collapse as very low, and contrary to what many still believe, in the middle of 1930s great depression prices rose very rapidly for two years or so after inflationary policies were undertaken by the US Treasury. More likely, inflation will accelerate over time, while the economic cycle will see lower highs and lower lows.
If inflation could be created in even the worst historical economic period, I don't see why the US government won't be capable of even more inflation now.
I think the feedback was much slower and weaker back then - The economy (or at least what passed for it on CNBC) was booming (Booming, I tell you! Booming!) and there were a lot of long-term plans and lots of money in motion lots of business inertia. A lot of otherwise brilliant people thought that the downturn could be simply powered-though. Of course this has turned out to bethe worst recession that nearly all living business managers have ever seen. As a result I expect that:
1: Many big-deal opportunities with long lead times that would have been go-ahead investments in 2006-7 are now just too risky.
2: Every investment must now have incremental plans A, B, C, D, E. If things start to cool down between B and C, no resources are allocated to D, (And don't even talk about E.)
3: The lookouts have all been given binoculars (And night vision goggles)
BTW, Here's that article that pegs US recessions to $80 oil.
My spidey sense tells me that Dollars are made up of Materials, Ideas, Time, and Energy, and when you get less real energy per dollar, it's changing things in ways that economists only have nightmares about.
In a very general sense I think there is too much "stuff" in the world relative to energy. There are too many people, too many houses, too many cars, too many buildings, too many ipods, etc. None of this is needed in any real sense, and I think what we are seeing now - unemployment and low wages, real estate collapse, falling sales, etc. confirms this.
Thereby it's my opinion that peak oil really does mean debt deflation and economic contraction on a grand scale, at least for now. I don't quite agree with the full deflationary view - commodities, energy, and essentials should receive price support and maybe even inflation, as more dollars out of a smaller total pool chase them.
In short, a sort of mixed picture that is nonetheless deflationary. Being poor admidst "plenty" is exactly what I see going on. It's energy that's the limiting factor. Bernanke is no emperor - and even if he were, he cannot magically create economic growth in an era of energy scarcity.
And one more thing, The Great Recession started in December 2007, before oil began trading at $100 in January of '08.
It was trading above $80 for only a few weeks before the recession started. (But it was some months before the data showed the start date.)
I'm very tempted to predict that in a few months The Great Recession II will be found to have started in April, 2010.
Relax, We’ll Be Fine --according to Dave Brooks of New York Times
Does peak oil matter if it's not supply constrained? What's happening in the U.S.is people paying down their debt. That's not good for growth, but it does indicate that oil demand may stay relatively low. There's more to efficiency than oil use. The u.s. is a very efficient manufacturer. I fear not having $100 oil, and not having $200 oil in ten years.
As far as the economy (U.S.), I talk to people everyday who say their business is much better than a year ago. I do wonder about another jobless recovery, however.
dcmiller said,
" What's happening in the U.S.is people paying down their debt."
That is SOOO important, and one of the great under-reported economic stories occuring right now. Everyone worries about "hoarding". What is happening right now is money hoarding. Businesses, individuals, banks are all hoarding money, raising their reserves to the highest possible levels. What does it mean?
First, the economy will grow slow, as you point out dcmiller. There is a real risk of another fairly sizable stock market retreat as the market gets ahead of the economy.
It may also mean that the expected post collapse inflation may not be nearly as bad as expected. If people hoard money, sellers of goods and services will be under continued price pressure to keep prices down or even lower them.
The combination of money hoarding and extreme distrust of financial institutions of all types lead to another problem, one that folks (I will include the very astute, but I beleive slightly mistaken Gail E. Tverberg on this issue) attribute to peak resources. The resource that is most treasured today is money (after all, nations give up oil for money!), and so far there has been no evidence yet of oil hoarding but there is plenty of evidence of money hoarding.
What is the eventual outcome (by which I mean sometime in the next two decades? It could work out that American entrepreneurs will have to go international to fund their ventures, seeking money from nations that are less risk averse than the American investors and banks.
We could spend a book discussing this, but if the risks in new technology turn out to have staggering returns, the Americans could be left lagging, earning 3% or 4%, while international investors are earning more than double digit returns.
Another possibility is that inflation will simply devour much of the savings of the money hoarders. Even an inflation rate of 5% is catastrophic to annual post tax returns of 2%. At that spread between inflation and return, a whole estate would be wiped out in about 15 years (remember that compound interest works in both directions..eash year as the estate gets smaller the inflation bite works it's magic as the estate holder falls further and further down the comparitive economic pile)
A third possibility: As perceptions that the money is loosing it's safety as a store, and an aging population wants to enjoy one last experiential journey, there will be a spending spree, i.e., a "boom" with all that saved money. This has important implications concerning issues of carbon release and energy consumption. In a market already filling up with the art pieces, collectable cars and fine homes, furniture, etc., of a generation, this could be a profoundly prosperous time for those with a load of hoarded money and the discretion to use it well....they could essentially live like the monarchs of old with the finest artifacts of one of the greatest artistic ages in history.
One last, but very real danger: TAXES. The government will not take well to being starved out while the money hoarders sit on piles of cash. We could see a revocation of the current 401K type "encouragement to save" structure, and see the government look for various devices to get their share of this giant nest egg, but trying to cloak it in such a way so as to avoid massive political backlash.
So, which way are you betting your money? :-)
(just for full disclosure, I have reduced my debt load by some 85% in the last two years, with a goal of debt free by middle of this year (2010)
RC
I don't think he means to say it will never get over $100 . . . just the latter of what you write . . . that when it does cross around $100, that will throw the economy in a tailspin, recession, decreased demand, price drops, then a recovery, then oil approaches $100 . . . rinse & repeat.
Or as CERA would say . . . an "undulating plateau".
I think the price that triggers the collapse will go up over time though.
It is far too early to count out the deflationists, as deflation is just getting started, here in the West.
In Japan it has been running for twenty years. Government policies and a positive current account have prevented an economic calamity, but what about the next twenty years?
What matters is not the nominal price of oil but the real price. If the dollar changes its value the nominal price will change, too. What matters is the amount of production that can be gained from each barrel, this measured as a proportion is the real cost of oil - and all other inputs - to an economy. Campbell's remarks reflect this understanding.
The feedback loop is simple enough with a high enough price shrinking margins which in turn wallops demand. Very high prices are unsustainable. Businesses - and their customers who are other business's workers - run out of money. Eventually, everyone goes bust.
- The greater finance industry is hollow compared to the pre- Bear Stearns iteration.
- The credit multipliers are negative and accelerating.
- The central banks are moving away from liquidity facilities.
- This likely represents a dollar hardening as it is closely pegged to crude oil.
- Increased demand for dollars means a move away from debt as this is sold to obtain more dollars.
Deflation
Since the economies' major players are moving into cash by dumping assets (to the taxpayers) and there is negative net investment with decapitalizaion of the economy - along with and despite near zero short- term nominal interest rates - deflation is taking place.
High oil prices are deflationary, there is an allocation of funds away from commerce toward fuel. Our economy is intended to be profitable with cheap natural resource inputs.
Here's another bit - just change the words 'gold' into 'oil':
Right now it is the US dollar pegged to crude that ties all the countries together! This - and general deflation amplified by high energy costs - is why credit, currencies, trade and productivity worldwide is under severe pressure. The difference between now and 1933 is there is no easy way to decouple the dollar and crude oil. The only way would be fairly severe conservation/rationing.
Horribly inconvenient, no? I love my godd***ed car!
If oil prices continue to increase, at some point sufficient business will be lost to cause another crash and demand destruction. Oil prices will plummet as all countries - even the investors' darlings the 'developing (what) countries' will see demand crash. After another 'green shoots' period, the oil price will rise again and the peg reestablished. The depression will continue as hard currency antics will export deflation from the US ... or any other country that finds its currency pegged to crude oil!
It doesn't have to be dollars! It could be yuan or euros or even drachmas!
Read this Simon Johnson article about the euro and Greece.
Here's Steve Walmann's China revaluation take: he points out China's wage advantage and argues against currency revaluation.
The trigger on the next obvious deleveraging leg might be $85 - $90 oil. Governments and business have been scrambling to keep the credit dominoes from falling and starting a chain reaction, an oil shock would be a very large domino.
Aren't we in that range right now? I've been posting my opined range at 105-115. Guess we'll see...
I wonder if that range will creep up as we increase efficiency with each shock? The level that sends us into recession might be an indicator of how well the shift is going!
Still, considering the colossal amount of energy in a barrel, and how there simply is no alternative for many uses - people would still have to drive, and at some point the recessions might not reduce demand below supply for much of a 'breather' on price. And the spikes could still be quite high. We should see massive volatility rather than oil in a tight range as we have, no?
Increase efficiency of a decrease in 'doing extra' and trying for only doing what is 'needed'?
I was writing on the web about the coming collpase of the credit system - especially Fannie Mae - five years ago, before you and Stoneleigh, so I think I'll pass on getting the additional education you suggest.
Anyway you say it is premature to make judgements about deflation. You are exactly right there - Japan will be swinging from very mild deflation to high rates of inflation within years.
The Chinese coal carrier hard aground in the Great Barrier Reef Marine Park saga continues.In the Courier Mail (07/04/2010) it is reported that the master of the vessel is complaining that the salvage people on board are eating his food and drinking his water.
Seems that there might be a problem with reality perception as well as navigation ability.
This ship(wreck)is not going anywhere soon.Most of the crew will probably be on a plane back to China in the near future.The master and possibly some of his officers will almost certainly be guests in Her Majesty's Hotel where they won't have to worry about food.
Link Feeding rescuers worries Shen Neng 1 captain more than oil spill
Ms Bligh also fails to comprehend if Australian coal exports help China's 2.5 billion tonne coal habit then the reef is going to turn into a lump of rock anyway. The jury seems to be out on whether coral can cope with even another 2C of warming.
One day the State may have to decide whether it wants coal exports or coral reef based tourism the more. Right now they think they can have it both ways.
And, in more important news...,
Tiger woods was recently caught texting on the tenth green….,
It’s a hole in one! he will be singing divorce papers later this afternoon.
http://news.yahoo.com/s/ap/20100406/ap_on_sp_go_ne/glf_masters_woods_cel...
For the first time ever, Dancing with the Stars beats American Idol in ratings.
http://tv.yahoo.com/dancing-with-the-stars/show/38356/news/tv-news.en.ap...
Rielle Hunter will soon appear on the Opra Winrey show.
http://news.yahoo.com/s/ap/20100406/ap_on_en_tv/us_winfrey_rielle_hunter...
John Gosselin is suing Kate Gasselin for her appearance on Dancing with the Stars.
And,
Erin Andrews will not allow death threats to stop her from dancing.
http://news.yahoo.com/s/ap/20100406/ap_en_ot/us_people_jon_gosselin;_ylt...
http://www.cnn.com/2010/SHOWBIZ/04/05/erin.andrews.not.quitting.ppl/inde...
Despite hitting an iceberg, it's BAU on board the RMS Titanic.
Well, that's just BAUtiful.
Reuters quotes Colin Campbell....
""Peak oil drives prices up in the first place. It has its own mechanism. We're sort of at peak demand right now," Campbell told Reuters from his home in the village of Ballydehob, West Cork. "I think presently the price limit is about $100."
For those who have painted alarming pictures of civil unrest as the world economy is forced to move away from conventional fuel and pay high prices for it in the interim, an inbuilt price mechanism to limit demand and move the world to other forms of energy should be a good thing."
Well, well, well...:-)
RC
Thank you for all the nice comments everyone - I feel truly welcomed :)
John
More About Oil: A Preview of the New Decade - Professor Ferdinand E. Banks
A worthwhile read.