Drumbeat: July 5, 2010

China Fears Consumer Class Impact on Global Warming

GUANGZHOU, China — Premier Wen Jiabao has promised to use an “iron hand” this summer to make his nation more energy efficient. The central government has ordered cities to close inefficient factories by September, like the vast Guangzhou Steel mill here, where most of the 6,000 workers will be laid off or pushed into early retirement.

Already, in the last three years, China has shut down more than a thousand older coal-fired power plants that used technology of the sort still common in the United States. China has also surpassed the rest of the world as the biggest investor in wind turbines and other clean energy technology. And it has dictated tough new energy standards for lighting and gas mileage for cars.

But even as Beijing imposes the world’s most rigorous national energy campaign, the effort is being overwhelmed by the billionfold demands of Chinese consumers.

Chinese and Western energy experts worry that China’s energy challenge could become the world’s problem — possibly dooming any international efforts to place meaningful limits on global warming.

If China cannot meet its own energy-efficiency targets, the chances of avoiding widespread environmental damage from rising temperatures “are very close to zero,” said Fatih Birol, the chief economist of the International Energy Agency in Paris.

Singh's Resolve to Rein in Spending Tested by All-India Strike Over Fuels

Flights were grounded, companies shut offices and protests jammed roads across India as a strike over fuel prices tested the government’s resolve to rein in spending that has spurred the budget deficit to a 16-year high.

The main opposition Bharatiya Janata Party and communist parties, which independently called nationwide 12-hour stoppages, say truckers, shopkeepers and government workers are backing them to protest Prime Minister Manmohan Singh’s June 25 decision to stop subsidizing gasoline and diesel.

Oil Rises as Five Days of Decline Makes Commodities Attractive to Purchase

Crude oil rose for the first time in six days in New York as last week’s decline and the outlook for global growth made the price attractive to investors.

Crude’s 14-day relative strength index dropped below 40 last week for the first time since May 26, approaching a level that may signal an imminent rebound. China’s Premier Wen Jiabao said over the weekend the government will ensure “steady and relatively fast” growth.

OPEC surplus keeps price of crude down

Iran's OPEC governor Mohammad Ali Khatibi said the organization had surplus capacity of 4-6 million barrels of oil per day, which was keeping the price of crude down.

"Right now, because of the economic crisis, OPEC is facing a 4-6 million barrel surplus capacity," Khatibi said, according to the Iranian oil ministry website SHANA.

Abu Dhabi National Oil Cuts Prices for Cuts Cargoes Lifted in June by 4%

Abu Dhabi National Oil Co., the state-owned producer, cut the price on all four of its crude grades by almost 4 percent for cargoes lifted in June.

UAE airports 'refuse fuel to Iran jets'

TEHRAN — Airports in Britain, Germany and the United Arab Emirates have refused to offer fuel to Iranian passenger jets after unilateral sanctions imposed by Washington, ISNA news agency said on Monday.

IRNA, the official state news agency, said in a separate report that Kuwaiti airports have also declined to offer fuel to Iranian passenger planes.

Iran announces gas field discovery in Gulf

Iran has discovered a natural gas field in the Gulf with reserves of more than 700 billion cubic metres, Oil Minister Massoud Mirkazemi said on Monday.

China sentences U.S. geologist to 8 years

An American geologist held and tortured by China's state security agents was sentenced to eight years in prison Monday for gathering data on the Chinese oil industry in a case that highlights the government's use of vague secrets laws to restrict business information.

In pronouncing Xue Feng guilty of spying and collecting state secrets, the Beijing No. 1 Intermediate People's Court said his actions “endangered our country's national security.”

Saudi King Seeks Wise Oil Use, Not Output Ban, Banque Saudi Analyst Says

King Abdullah of Saudi Arabia, holder of the world’s largest crude-oil reserves, encouraged using the fuel wisely to protect the interests of future generations, rather than a ban on exploration, an analyst said.

The monarch told Saudi scholars studying in Washington that he had ordered all oil exploration to cease “in order to keep the earth’s wealth for our sons and grandsons,” state-owned Saudi News Agency reported yesterday.

“The King’s statement shouldn’t be perceived as a message that Saudi Arabia is stopping its capacity expansion projects but rather that Saudi Arabia has to be mindful of the future needs of the country and be cognizant of its usage wisely and prudently to support future generations,” said John Sfakianakis, chief economist at Riyadh-based Banque Saudi Fransi.

Saudi Arabia’s real energy problem(s)

Upstream reported in May that Saudi Arabia is exploring for hydrocarbons in the Red Sea, and has recorded 22,000km of seismic data there, among challenging geography including 2km-plus water depths, high temperatures and a layer of salt. It has also commissioned exploration around the Manifa oil field in the Persian Gulf.

But the overall focus is on gas, not oil, because of the Kingdom’s domestic electricity supply problem. It heavily subsidises both fuel and electricity use, and consequently consumption is growing too fast for domestic gas supply to keep up with. Platts reported last month that Saudi Arabia diverts about 877,000 b/d - or 11 per cent of its current oil output - to its own domestic electricity supplies.

In fact the King’s ban story somewhat reminiscent of a warning by Saudi Aramco chief Khalid al-Falih warning in April that it may have to take another 3m b/d off the markets by 2028 if domestic efficiency was not improved.

Russia and Kazakhstan sign three agreements

ASTANA (Itar-Tass) -- Russia, Kazakhstan have signed three agreements on cooperation in nuclear power engineering and on the construction of a hydropower plant.

BP's Oil-Collecting Effort Delayed as High Waves Hamper Vessel Connection

Waves as high as six feet (1.8 meters) may persist for most of this week off the Louisiana coast, forcing BP Plc to postpone already-delayed efforts to double the amount of oil being captured from a leaking Gulf of Mexico well.

Wave heights in the area of the Gulf that includes BP’s Macondo well are expected to average from 3 feet to 6 feet through July 8, the National Weather Service said yesterday on its website.

BP Wants Partners to Help Shoulder Spill Cost

BP has said repeatedly that it will pay for the disastrous oil spill in the Gulf of Mexico. But its actions show that it does not intend to go it alone.

Newly released documents show that on June 2, BP sent out demands for nearly $400 million to its partners in the well, the Anadarko Petroleum Corporation and the Mitsui Oil Exploration Company of Japan, or roughly 40 percent of the $1 billion BP spent in May.

Kuwait mulls over BP assets

Opec member Kuwait may buy some of BP's Middle East and Asian assets, according to reports, as part of the UK oil company's attempt to raise funds and fend off takeover bids.

Dealers ready to plug in to Volt

Chevrolet dealerships in the area are getting energized for next year's arrival of the Chevrolet Volt.

"I expect it to do well because it's the first practical car on the market," said Bill Guibeaut, sales manager for H&L Chevrolet in New Canaan, who looked over the vehicle at the New York International Auto Show and has orders for three of them. "It's not a golf cart."

Many moons to go: the promise of lunar mining

For $1-billion, Canada convened a summer weekend session of assorted world leaders who, as they left, produced an ambivalent communiqué of improbable historic importance. For $3.2-billion (U.S.), or a week’s worth of such summitry, several of these same countries paid for the U.S.-European Cassini space mission to Saturn, a 3.5-billion kilometre, seven-year voyage that has revealed the secrets of Saturn’s strange orange moon, Titan. It turns out that Titan is awash in liquid hydrocarbons: in oil. Indeed, it rains liquid hydrocarbons – and, in the moon’s light gravity, each drop floats down from the clouds at roughly the speed that large snowflakes fall to Earth.

With only one-fifth of this moon radar-scanned so far, scientists calculate that dozens of lunar lakes each hold more oil and gas than all of Earth’s proven oil and gas reserves – and that Titan’s equatorial sand dunes hold hundreds of times more coal than all of Earth’s proven coal reserves. Titan is a vast reservoir of hydrocarbons. Talk about Peak Oil.

Investment trusts - Help needed for the planet

The 'peak oil' argument relates to the fact that the rate of discovery of new large-scale oil fields has declined, while demand has not. Examples of clean energy are the solar, wind, tidal and biomass sectors. Along with population growth, other trends include increased urbanisation and demand for higher living standards coming from those in developing countries, and, of course, those in developed countries wish to at least maintain their current standards of living.

All this places an increasing importance on materials (for example, base metals) for use in construction of the infrastructure to support the population globally. A common problem in developed markets is the fact that the infrastructure, perhaps built over a century ago, is nearing the end of its life and will need to be replaced. Finally, new techniques will need to be developed in order to produce food on the required scale and distribute it, within the constraints imposed by energy usage and climate change.

Lost in translation

A recent Associated Press-Gfk poll found that a plurality of people still favor offshore drilling, no matter what is transpiring in the Gulf of Mexico. Has no one concluded that this might be the moment to reframe our entire energy policy? Has no one figured out that we're not just living in a time of peak oil but we're living in a time of peak planet?

The moratorium and palm oil

More than five weeks since Indonesian President Susilo Bambang Yudhoyono committed to a two-year moratorium on the conversion of primary forests and peatlands into oil palm plantations, related ministries and palm oil companies have remained confused about how the program will be implemented.

GE Using Nanotechnology to Green the Alberta Oil Sands

The technology is based on naturally occurring zeolites identified by UA. These materials are rocks with molecularly sized pores, which allow small molecules to enter while excluding larger molecules. Zeolites are widely used in the chemical industry as catalysts, and this project seeks to form these materials into membranes that can be used for high temperature gas separation. The materials also have the potential to be used as filters for contaminated water. The CCEMC is providing $2 million in support of this project, with an equal cost share from GE and its project partners.

Threats of Global Warming Spark Environmentalists to Create Global Warming Survival Center

The founders of GlobalWarmingCenter.com are urging the public to understand that global warming is a very serious threat to the planet and their livelihood. To help people understand the extent of these threats and prepare them for the inevitable effects of global warming, GlobalWarmingSurvivalCenter.com is providing a free video mini course available for download and viewing on their website.

Climate change and root crops

POTATOES are among a range of crops likely to be affected by more severe disease outbreaks as a result of climate change, a major new technical review has concluded.

The review, undertaken by ADAS and commissioned by BASF, predicts climate change will bring about significant changes in the spectrum of diseases which damage crops. In most cases, the severity of disease outbreaks will increase.

Melting ice fields pose serious threat to water supply in Asia

The mighty Yangtze and Yellow rivers, as well as the Mekong and the Ganges, are in danger of running out of water, threatening the livelihood of millions in India, China, Pakistan and other parts of Asia.

The Qinghai-Tibet plateau covers 2.5 million sq kilometres – around a quarter of China’s land area – at an average altitude of 4,000 metres above sea level.

Himalayan glaciers on the Qinghai-Tibet highland store more ice than anywhere on Earth except for the polar regions and Alaska. But because of global warming, all across the plateau, glacial and snow run-off is evaporating, leaving dwindling rivers dangerously clogged with silt. Northern India relies on glacial run-off for much of its fresh water.

The heat age

The past 12 months have been the hottest since measurements began, in keeping with trends that have, for the past 35 years, shown global warming unfolding as predicted by science.

Airlines Fret as Emission Rules in Europe Are Set to Kick In

Among the major airlines, there have been remarkable advances in biofuels aimed at reducing the footprint of commercial aviation drastically. But those experiments are at an early stage.

So instead of relying on a technological leap forward that still may be years or even decades away, the European Union is embarking on another way of lowering the emissions from flying: making airlines join its five-year-old Emissions Trading System.

China Fears Consumer Class Impact on Global Warming

I have been pushing for a policy of applying a tax on electrical devices over their working life that is equal to the cost of offsetting the electricity/CO2 down to the level of the best A+ or A performing devices. This will encourage people to buy A class devices since now people often tend to just look at the initial price and others who have no interest in the running costs just the up-front costs e.g. landlords, builders.

No new technology or investment required just some simple political will. It would be strange if China were to become the first major country to do something like this:-)


Speaking from an economist's point of view, your proposal is excellent. But economists only advise; they rarely make policy decisions (except at the Federal Reserve Bank). Politicians make policy, and politics is the art of the possible. It is just not possible to impose the tax you suggest, nor is it politically possible to raise the gasoline tax. Washington DC never forgets what happened to Jimmy Carter when he suggested a nickel a gallon increase in the gasoline tax; that one proposal may have been the key factor in keeping his presidency to one term only.

The last presidential candidate to suggest any kind of tax increase at all was Walter Mondale: Remember what happened to him?

Economics journal articles and books are full of good suggestions of how to use taxes to discourage negative externalities--but these proposals all fall into the same category of politically impossible, just as yours does.

Voting out the incumbent b#stards and voting in a new batch is futile. The problem is in the structure of our political system, a structure dominated by lobbyists for and campaign contributions from special interests who favor light taxation of the rich and powerful--and corporations in general.

Our system is doomed to overspend because of the special-interest effect and also to undertax because of the same effect combined with some other political dysfunctions of our postindustrial politico-economic system.

Our system is doomed to overspend because of the special-interest effect and also to undertax because of the same effect combined with some other political dysfunctions of our postindustrial politico-economic system.

Such a culture of entitlement will not last. Getting everything for nothing is an insane public policy. Postponing austerity and taxation is only making the inevitable worse when it happens. The fact that Governor Schwarzenegger is musing about paying California civil servants minimum wage and Illinois has become Greece on the Michigan is not boding well for the future prowess of the United States.

Here in Canada twenty years ago, there was a seismic shift in public policy. One government raised taxes (Mulroney's Conservatives introduced a 7% General Sales Tax in 1991) and the next government slashed spending (Chretien's Liberals budgeted a "nothing off the table" policy of austerity). The ironic fact that it was a conservative regime that raised taxes and a liberal regime that drastically cut spending was not lost on the Canadian public. It was a rough time for those of us who had to go through it, but we're better off today because of it. At least Canadians are able now to bankroll public policy without worrying excessively about public debt (although those figures were revised upward recently owing to stimulus spending).

Don, all you have to do is convince the Democrats to become the party of austerity and the Republicans to adopt tax platforms.

Niall Ferguson, the economic historian, has rightly pointed out culture has a lot to do with how successful countries will be in meeting the challenges ahead. Canadians have had a long track record of balancing the books (historically, high deficits are an anomaly north of the 49th parallel) whereas Greece is notorious for tax evasion.

Are Americans more like Greeks or Canadians?

If the answer is the Greeks, then the U.S. is destined to become the U.S.S.R. Redux.

Such a culture of entitlement will not last. Getting everything for nothing is an insane public policy. Postponing austerity and taxation is only making the inevitable worse when it happens. The fact that Governor Schwarzenegger is musing about paying California civil servants minimum wage and Illinois has become Greece on the Michigan is not boding well for the future prowess of the United States.

Yes, but getting something for nothing has worked for a number of years, so the average person doesn't see much if any incentive to change until recently.

The modern era of deficit spending kicked off not long after the US reached its domestic PO moment, almost 40 years ago. To facilitate payment for growing crude oil imports, the US basically only issued new dollars - which were accepted at face value or near face value due to the US dollar's reserve currency status. State and local government ran up huge deficits, which were indirectly financed by the Fed creating an abundance of new dollars domestically.

The recent panic out of the Euro has only reaffirmed the use of the dollar as a reserve unit. That is why I believe the US economy will not be seriously impacted by its inflationary ways until oil is in shorter supply.

The recent panic out of the Euro has only reaffirmed the use of the dollar as a reserve unit.

In days of yore, imperial powers financed themselves by demanding tribute from client states. American global hegemony is backed by something similar - instead of overt tribute, client states now hold U.S. dollars on reserve. And that system will work for as long as there is no alternative to the greenback. Unfortunate for long term U.S. security, gold and Euros are sitting contenders on the horizon.

Nothing is static and what is true today may change tomorrow. If Europe gets its financial act together and implements austerity and the United States does not, then the world may opt for euros in place of dollars.

Although one day's trading is no indication of the current state of affairs, today's news on a run to euros may be a bellwether of things to come, particularly if U.S. policy makers do not wake up to the siren's call:

I think many Americans understand that the rest of the world would react to U.S. diminution on the world stage much the same way as it did the Soviet Union's collapse: too bad, so sad, now let's see who will play with us today. The dollar, like U.S. military power, would not be immune to the indifference of international self-interest.

If Europe gets its financial act together and implements austerity and the United States does not, then the world may opt for euros in place of dollars.

Indeed. But then again I'd hate to try to predict the outcome of this particular race to the bottom. The universal sense of limitless entitlement seems even more entrenched in Europe than in the US even if the basket of presumably God-given goods and services differs somewhat. There is a long, long history of announcing austerity but then backpedaling, softly, softly, the very instant a few fishers blockade some port. The French, especially, have raised this sort of theater to a fine art. So I'll believe it when I see it. Meanwhile, I figure that this show will call for a jumbo tub of popcorn...

The French, especially, have raised this sort of theater to a fine art.

Thank you, Paul, for the reminder that we are all hamstrung by our cultural assumptions. European sacred cows are different than American ones but their entitlements are no less politically off limits.

I think I'll join you for that jumbo tub of popcorn.

The example that springs to my mind is Britain. It struck me as odd, from a Canadian perspective, that David Cameron in announcing austerity measures for the U.K. left out the National Health Service and education, two of the biggest expenditure departments of government. What kind of austerity is that? Clearly, not a government with its sights on restructuring public finance beyond tinkering here and there. Yet, the political landscape is not designed for anything else. Even the ferocious and fearless Maggie Thatcher stopped short her revolution by not touching the cornerstone of Clement Attlee's New Jerusalem.

Meanwhile, at home in Nova Scotia, our local social democratic (NDP) government is expressing strong concern over the burgeoning cost of health care (42% of provincial expenditures) and has not been shy to say no and hold fast to current estimates. (Incidentally, socialist provincial governments in Canada have had a far better track record of balancing the books than their conservative counterparts. Go figure!)

The Canadian propensity towards deference to authority means that governments have some latitude to introduce taxes or to hold/cut expenditures without the threat of a Tea Party movement. My worry is that the U.S. will bankrupt itself by trying to avoid provoking a populist reaction. The fact remains: something will have to be done to bring soundness to American and European public financing. Otherwise serious trouble awaits ahead - and sooner not later.

I would hate to see the fall of western civilization brought about by political inertia and collective obsessions about entitlements but that seems to be happening.

I wonder if it's a baby boomer thing? The generation that had it all is hell-bent to lose it all.

Zadok, what I don't understand, about our respective provincial governments, is why they don't just start (gradually) reducing salaries for health care workers, instead of reducing services. They are some of the most highly paid people, who have job security the rest of us can only dream of, and to take a 5 or even 10% pay cut would not put them out on the street. I'd like to think the provinces could co-ordinate such a move, to prevent migration of health care workers from one to another, but even if they don't , and say, Alberta holds steady, there's only some many more people they can afford to hire, if any.

All government workers can only earn what the people can afford to pay them, and right now, that is less than what it was last year, or the year before, etc.

I would like to see at least one government take this approach - the health care workers may not like, it, but everyone else will.

Paul, I couldn't agree with you more. It makes far more sense to curtail salaries than to reduce beds and limit procedures.

My understanding, however, is there are two brakes on such an approach: 1) that our health care system is top heavy and bloated with management; and, 2) the unions remain powerful.

The political headache for most premiers, treasurers, and ministers of health is that for every extra dollar of provincial budgets that go to hospitals and health care workers, one fewer dollar is available for roads, education, municipalities, and welfare.

I would suspect that if a showdown took place in one province, other provinces would be quick to follow. And you're right. Any province foolish enough to hold out for higher wages to attract top quality workers (and thus balloon their own budget) would soon be swamped with excess applications.

I figure the day of reckoning is coming. And once salary caps are imposed in one jurisdiction, the domino effect will take hold. The public is aware of the limitations on health care services, so if the labour battle is presented as a measure to reign in costs, the political ramifications would be minimal.

The idea of "just paying health care workers less", becaause "they are some of the most highly paid people, who have job security the rest of us can only dream of, and to take a 5 or even 10% pay cut would not put them out on the street" strikes me as incredibly cynical and sad.

A person doesn't just become a "health care worker", the process involves many years of schooling, depending on the position. Most if not all of the higher level workers, Pharmacists, Nurses, Nurse Practicioners, Physicians Assistants, Doctors, etc. had to take out numerous loans for multiple years of schooling. While others were involved in decent paying tradeskill jobs (electrician, plumber, manufacturing, etc), making money while training on the job... health care workers were paying vast sums of money and putting in long hours for their education, while earning nothing in the meantime.

Fast forward to when schooling is finally completed, sometimes 10 or more years later, and that health care worker now has hundreds of thousands of dollars worth of debt to pay back, while that tradesman has been making money the whole time. Job security in healthcare comes with a high price tag... it cost that worker a heck of a lot of time and money to earn that security.

If you start balancing the budget on the backs of healthcare workers, many will quit, and you will especially lose some of the best ones. Even if you coordinate some kind of nationwide pay cut, they will still leave in droves... to the US. Top notch surgeons and other healthcare workers will give you the finger and take their skills somewhere where they can at least make decent money for doing some of the WORST jobs you can imagine.

Less workers means longer wait times, even for emergency care. When every second counts, do you want your hospital to be shortstaffed? Would you like your surgery to occur during your doctors 15th hour in a row of work?

I understand that you want to save money on healthcare, it makes sense to try to be as financially savy as possible when large sums of money are involved. I would argue that you shouldn't attempt to save a few bucks at the expense of the people who are actively working to save lives. If you want to save some cash, stop paying for certain expensive procedures and tell affected patients and familys, sorry, the taxpayers have decided they can't afford to pay for this procedure.. you are welcome to pay for it yourself and/or use your secondary insurance if you choose, and here are the odds that your procedure will be sucessful.

Meanwhile, if you think healthcare workers have it so good, maybe you should undertake the training and become one... more hands are always appreciated and you seem to believe the grass is greener for them.

The idea of "just paying health care workers less"... strikes me as incredibly cynical and sad.

Runeshade, I hear what you are saying. I work almost daily in connection with the health care system. I have friends who are pharmacists, doctors, nurse practitioners, and palliative care workers. My wife was a labour-delivery and operating room nurse in times past. I see firsthand their expertise, dedication and willingness to do jobs that nobody else can and will do.

I'm also seeing the other side of the coin. Demand is rising, costs are growing exponentially, revenues are stagnant, and the strain on the system is showing. (And this is before the baby boomer glut hits in full furor). I talk to people who are waiting procedures that are increasingly falling outside provincial coverage or who are waiting for standard treatments that are routinely postponed.

It's not a question of whether health care professionals are worth the money (most are), it is a question of living within one's means. This is especially true when belt tightening has been the experience of many others. If one has to rob Peter to pay Paul it is more than reasonable for Peter to ask Paul to be modest in his earnings.

Yes people are mobile and can move to lucrative jurisdictions. This doesn't change the reality that practically every jurisdiction is facing the same dilemma and the same resource restrictions.

It is not about being cynical; instead, it's about being responsible for that which has been entrusted to our care.

A person doesn't just become a "health care worker", the process involves many years of schooling, depending on the position. Most if not all of the higher level workers, Pharmacists, Nurses, Nurse Practicioners, Physicians Assistants, Doctors, etc. had to take out numerous loans for multiple years of schooling. While others were involved in decent paying tradeskill jobs (electrician, plumber, manufacturing, etc), making money while training on the job... health care workers were paying vast sums of money and putting in long hours for their education, while earning nothing in the meantime.

Fast forward to when schooling is finally completed, sometimes 10 or more years later, and that health care worker now has hundreds of thousands of dollars worth of debt to pay back, while that tradesman has been making money the whole time. Job security in healthcare comes with a high price tag... it cost that worker a heck of a lot of time and money to earn that security.

To me the current problem is one of too much debt. Debt (primarily government backed) has distorted pricing in the medical profession the same way it has distorted it in many other key industries --housing being one of the most salient examples. Thanks to the debt burden, many of these health care professionals are forced to decide their career path, specialties and location based not on public need or their own desires, but purely on the basis of income potential.

If the cost of medical education were mostly or fully subsidized with grants not loans (as in Europe), the situation in the U.S. might be very different.

yes, it would be different. We'd see the cost of a medical education skyrocket even faster, and the number of people entering the field limited by Congress refusing to pay the bill.

If your solution to the problem is "government", then the solution is worse than the problem.

Runeshade, health car workers are not the only ones who do years and years of training. So do lawyers, accountants, scientists, engineers (I am one of those). The difference is, for the professions I just named, you don't (in Canada, at least) get a govt guaranteed job, you are with the ups and downs of the economy the same as everyone else.

I am not saying health care workers do not work hard, or they they have not worked hard to get to where they are (so have many other people), I am saying that we cannot afford to pay them as much, that is all. When nurses can earn > $100k/year, and doctors are earning >$300k year, on government pay, I think that is too much. When people are suffering (and they are) because there are insufficient medical staff to treat them (and there are)

I did not for one moment suggest we have less staff, actually think we should have more, just paid less. It seems a logical solution is to pay 10% less and hire 5% more. Yes, some won't like it, and some will leave. many other private sectors have gone through painful pay reductions, so why should government be exempt? If you leave here to go to the US purely to earn more money, then you are doing Canada a favour. If your motivation is to earn lots of money, you should not be in a government job in the first place.

There is indeed scope for not doing certain expensive procedures, but you tell the family that operation X can;t be done because of budget cuts since the health care workers won;t take a pay cut.

In a recession (or worse, a war) everyone has to pull together, and make sacrifices. A 5% cut for all govt staff (incl teachers and health care) will not be the end of the world, it just puts them in the same boat as everyone else.

David Cameron in announcing austerity measures for the U.K. left out the National Health Service and education, two of the biggest expenditure departments of government. What kind of austerity is that?...

I wonder if it's a baby boomer thing?

I think it's more of a moralizing thing, the modern Western version of, oh, say, some of the antics of the Taliban. Almost from time immemorial, it has been possible and even sensible to say to whoever was regarded as something like the doctor of the day, "do everything you can" - simply because until quite recently "everything you can" usually didn't amount to a hill of beans. Now, rather suddenly, we're almost at Greg Mankiw's Dorian Gray pill (small PDF.) Tradition is no help in these new circumstances, it just insists blindly on "more, more, more" no matter the cost, sometimes on the grounds that everyone is an infinitely-entitled "child of God". Political correctness is no help either, it just insists on "more, more, more" no matter the cost, only for different reasons, namely the fatuous notion that everyone can be made "equal" every which way à la Harrison Bergeron.

We could probably already spend the whole GDP, and a lot more, adding yet more hours one at a time to the tail end of life at an exponentially rising cost (and declining worthwhileness) for each hour - or likewise on yet more hours worth of "safety". So when do we say "enough"? We can't and don't, because our "morality" forbids it, claiming that no amount can ever be enough. This simply cannot come to a good end, not even on the most optimistic business-as-usual trajectory.

I had a conversation not long ago with a planning officer with the Department of Health who echoed much of what you said. It is the awful dilemma facing every new Minister of Health, regardless of political stripe, as to where to allocate resources to maximize benefit. It's a bit like playing God - what treatments are affordable by the system and which ones go by the wayside? And inevitably, someone is going to lose out.

At the front line, doctors and nurses are trained and bound by professional ethics to saved lives. The Hippocratic oath compels them, at the minimum, to do no harm. Nobody wants to tell a family that their 90 year father isn't worth heart surgery or that dear Aunt Myrtle can't have chemo for her cancer. Unfortunately, as you point out, a good proportion of health care costs revolve around end of life care.

The foreseeable problem is that the next thirty years are going to be horrendous on our health care system as the baby boom generation goes bust. If the system is to survive, further limitations are going to have to be imposed restricting access to services and procedures. Everything will be scaled back, including wages. It won't be business as usual - we can only do what is affordable to do - and I would suggest politicians would be wise to start preparing the public now.

That's why I think Cameron would be better off putting the National Health Service under the financial gun. It is the one budgetary item that can wreck havoc with the best intentioned austerity package.

I'm looking at it from the philosophical angle which is of no value what so ever at this time; however, it may help us to understand the long term solutions.

I look at our current "extreme life prolongation" as a poverty of life experience and acceptance. If we look at the flip-side of the coin - and it does happen now - when one gets to last years and months of their life if they had lived a fulfilled and meaningful life, they would simply want to pass on and not fight to the bitter end. And bitter it is.

Is this a mass juvenile society unenlightened and unaware, lacking a moral and spiritual centre? That seems to be the root cause explanation. I'm not talking run of the mill, franchised and conglomerated religious moralities as advertised, but the understanding of the human experience within the universe.

Until we can as a species get to this level we will be doomed to repeat our shortcomings. This may not compute with health care administrators or ministerial budgets looking for immediate answers, but I would hope it would provide a guidepost to where we ought to be heading. So long as our societal programming has us as well trained for the production industrial inputs to be relieved on the magical day of retirement when we can really start living, this I'm afraid is our fate.

And no, a 90-year old man is not worthy of a heart transplant or an alcoholic a liver. When are we going to grow up and make the adult choices?

As I've said here before, we treat our pets more humanely at the end of life than we treat our elders. Nobody would dream of subjecting their dog to the suffering and pain that we inflict upon our parents and grandparents.

And no, a 90-year old man is not worthy of a heart transplant or an alcoholic a liver. When are we going to grow up and make the adult choices?

But what if that 90-year old man is Dick Cheney? The Empire must spare no expense to keep the irreplaceable Darth Cheney alive! I'm thinking a hermetically sealed bodysuit with its own built-in defibrillator and air supply...

...pass on and not fight to the bitter end...

In my experience the soon-to-be-deceased (when not severely afflicted with Alzheimer's) is often well aware of his or her situation and knows that it is, or shortly will be, time to let go of the heroics. The real fight tends to be among the next-younger generation of relatives (offspring, nieces, nephews.)

Paul, your assessment is quite accurate. Most terminally ill patients and elderly are acutely aware of what's happening to their bodies and the human body tends to shut down in a fairly standard sequence - although no two deaths are ever completely alike. Gramps or Nanny may be ready to die but it's the loved ones that often have to be convinced to let go.

For those working with a person who is dying the main concern is to have his/her affairs put in order so as to facilitate peace of mind.

What seems to be increasingly a stumbling block is the cultural perception that death is unnatural. Each time I lead a workshop on palliative care, I always begin with the statement: "Life is a sexually transmitted condition that is one hundred percent fatal. None of us get out of here alive."

People have been dying for thousands of years - it runs in families. If in doubt, just ask your great great grandmother. She's probably been through it. Moreover, the human body (in situations apart from trauma) has a remarkable ability to let a person know when it's time. Family and friends can help by giving permission. Once most people know this then they are generally receptive to follow through.

I find that nurses and doctors who deal regularly with the elderly or the dying can be a great source of comfort. Death need not be a fearful process.

Yes, I was reading the Victoria Times Colonist recently and noted that people are generally going along with the new HST to raise revenue and the unions also seem to be ok with wage freezes. What a concept! Wish we could take these kinds of responsible steps here in the US. This attitude of fiscal responsibility has served Canada well and will into the future.

Jim, The flip side to those wage freezes from the public sector unions (in BC , anyway) is that demanded, and got, agreement from the govt not to lay of any staff! Any person whose job dissappears, for whatever reason, must be found alternative, and equivalent, work in the civil service. So it's a cap on staff and spending, but it's a floor, too. What is really needed now is the ability to reduce both wages and numbers of civil servants - the government caved in here when it could have put its foot down.
BC has a problem with a growing number of retirees (moving here from other provinces) and not enough working people to pay the taxes for all the gov't workers (and health care, education etc) That's why they had to go HST, to get more tax out of people who spend, but don;t earn much (taxable) income, like retirees.
Meanwhile, those of us who are working (in the private sector) are a shrinking number and are earning less, while those working for the gov are now a static number and earning the same. Tax consumers are are exceeding what is provided by tax payers - a hard day of reckoning is coming.

Here in Michigan we are finally moving through the process you outlined and there is more to come. It has been a bitter pill for some in the public sector to swallow but a necessary one as you point out. It all started with the restructuring of the Big 3 and has moved into government in a big way now too. Michigan is cutting the number of state workers now using buyouts. We have over 2000 units of government!!

The last presidential candidate to suggest any kind of tax increase at all was Walter Mondale: Remember what happened to him?

OTOH, Reagan, Bush I, and Clinton all got tax increases passed. And Obama will almost certainly get tax increases by simply letting some or all of the Bush II cuts expire. It may not be possible to get elected on a platform of tax increases, and it may not be possible to get reelected if taxes do go up during your first term (Bush I), but it's possible to get some passed from time to time.

Rather then Presidents, I would ask whether a majority of the House (and a super-majority of the Senate) are willing to pass tax increases.

You pubbies have always wanted to bring about a situation where taxes were at a record low and the government was completely hamstrung by 'serious concerns'.
It's the 'starve the beast' strategy.
True, it dooms the USA to the kind of stagnation
you might find in a banana republic but at least the bank account is full.
It's a class war they've already won.
Does it really matter if the vast number of citizens are much poorer if the GDP continues to rise? Just look at that GDP!
This is the way the pubbies feel Peak Resources should be handled--rationing by price.
It's just not a problem---not like the IRS.

The way out is hefty increases in income taxes and low economic growth 1-2% for the next 20 years which is what happened after WW2 which brought the national debt down to about 40% of GDP(Carter).
Then the country will elect another Bonzo Reagan.

I will vote against any politician that raises income taxes (although I'm not opposed to taxes of other kinds), and I will vote against any politician that increases government spending.

And no, I'm not rich nor a peasant. I'm a middle class working person who is absolutely fed up of paying for endless entitlements for the underclasses of America, not to mention a bloated military. I'd rather have more of my own money to buy gold and make personal preparations for peak oil that benefit myself, my family, and my local community.

Dear Oilman
You are incorrect in your assessment that the government pays for entitlement of the underclasses. The sole purpose of the US government is to redistribute income to the elderly--social security, Medicare.

As if the elderly can't be underclass? If somebody doesn't have money or happens to be in ill health, don't rob me to support them forever.

The elderly, as a group (individual mileage may vary greatly) is the wealthiest demographic in the U.S., while the poorest demographic would be young people and children. By definition, if you're the richest something, you cannot simultaneously be the "underclass".

If the elderly are so wealthy, why do they need social security and medicare?

In any case, I don't want to pay them. I prefer to keep my money for gold and peak oil preparation. I'll have enough on my plate supporting my own parents and grandparents.

Why argue with the sophistication of a 10 year-old? I know you understood the point made, and I know you understand your question is simply argumentative. Is it your ego or your ideology or your agenda?


Ego: Don't have one. Maybe I did as a teenager/youth, but not anymore. My own ignorance is the only thing I'm aware of anymore, especially since the events of 2008.
Ideology: Again, none. Used to be left of center, drifting more libertarian, but honestly I don't think it matters in the face of energy decline.
Agenda: To survive and live the next 40 to 50 years with some dignity, and have the fruits of my own labor to support my pursuits and family, and not have it distributed willy nilly to 400 million other "Americans" by know-nothing politicians in D.C.

Hope that's clear. You can disagree if you like, but I've laid it out on the table.

Another non-answer. You well know not all the elderly are wealthy even if as a group they are, on average, wealthier than other cohorts.

Not appreciated.

Well I guess we'll just have to agree to leave each other be.

No, you'll be argumentative for the sake of it in the future, and I'll slap you upside the head for it.

At least there will be little confusion in the relationship.


In the end this exchange has been informative.

As we begin the decline I fully expect our country will tear itself apart just determining if granny can stay on the vent for another week, even as society enters terminal decline.

So thank you for your contribution, helps me to understand the ongoing dynamics that animate my pessimism.

Corporate welfare dwarfs "entitlements," but those counting on the American Fantasy that we can all be rich don't so easily give up their delusions.

I hate to break it to you, but "Corporate welfare" is a drop in the bucket compared to entitlements.

Several government agencies provide budget and debt data and analysis. These include the Government Accountability Office (GAO), the Congressional Budget Office, the Office of Management and Budget (OMB), and the U.S. Treasury Department. These agencies have reported that the federal government is facing a series of critical long-term financing challenges. This is because expenditures related to entitlement programs such as Social Security, Medicare, and Medicaid are growing considerably faster than the economy overall, as the population grows older.

These agencies have indicated that under current law, sometime between 2030 and 2040, mandatory spending (primarily Social Security, Medicare, Medicaid, and interest on the national debt) will exceed tax revenue. In other words, all discretionary spending (e.g., defense, homeland security, law enforcement, education, etc.) will require borrowing and related deficit spending. These agencies have used such language as "unsustainable" and "trainwreck" to describe such a future.[47]

While there is significant debate about solutions,[48] the significant long-term risk posed by the increase in entitlement spending is widely recognized[49], with health care costs (Medicare and Medicaid) the primary risk category.[50][51] If significant reforms are not undertaken, benefits under entitlement programs will exceed government income by over $40 trillion over the next 75 years.[52] According to the GAO, this will cause debt ratios relative to GDP to double by 2040 and double again by 2060, reaching 600 percent by 2080.[53]

In 2006, Professor Laurence Kotlikoff argued the United States must eventually choose between "bankruptcy", raising taxes, or cutting payouts. He assumes there will be ever-growing payment obligations from Medicare and Medicaid.[54] Others who have attempted to bring this issue to the fore of America's attention range from Ross Perot in his 1992 Presidential bid, to motivational speaker Robert Kiyosaki, and David Walker, former head of the Government Accountability Office.[55][56]

Thomas Friedman has argued that increasing dependence on foreign sources of funding will render the U.S. less able to act independently.[57]

Unfunded Obligations:

The U.S. government is committed under current law to mandatory payments for programs such as Medicare, Medicaid and Social Security. The GAO projects that payouts for these programs will significantly exceed tax revenues over the next 75 years. The Medicare Part A (hospital insurance) payouts already exceed program tax revenues and Social Security payroll taxes fully cover payouts only until 2017. These deficits require funding from other tax sources or borrowing.[47]

The present value of these deficits or unfunded obligations is an estimated $45.8 trillion. This is the amount that would have to be set aside during 2009 such that the principal and interest would pay for the unfunded commitments through 2084. Approximately $7.7 trillion relates to Social Security, while $38.2 trillion relates to Medicare and Medicaid. In other words, health care programs are nearly five times as serious a funding challenge as Social Security. Adding this to the national debt and other federal commitments brings the total obligations to nearly $62 trillion.[58]

The Congressional Budget Office (CBO) has indicated that: "Future growth in spending per beneficiary for Medicare and Medicaid—the federal government’s major health care programs—will be the most important determinant of long-term trends in federal spending. Changing those programs in ways that reduce the growth of costs—which will be difficult, in part because of the complexity of health policy choices—is ultimately the nation’s central long-term challenge in setting federal fiscal policy." Source Wikipedia

Corporate entitlements are just (mostly) better hidden.

I hate to break it to *you*, but corporate entitlements and bailouts far outweigh citizen entitlements.

Never mind "projections" to 2084 (as if its possible to accurately project budgets that far out), current annual outlay for S.S., Medicare/Medicaid, etc. while quite large cannot hold a candle to the tribute we pay to the Giant Vampire Squid and its minions.

Medical care is not an entitlement. But, I should have specified I was talking about welfare only, but I thought it was obvious given I said CORPORATE WELFARE.

And, make sure you add up all tax breaks, all subsidies, etc., for every business... then get back to me.


The country was much better off under a steeply progressive income tax.

In WWI the rate was 70% but it dipped to 25% in the 1920s.
Roosevelt raised the top marginal rate from 25% under Hoover to 63% and then 94% in 1944. It dipped to 82% under Truman but from Ike to Johnson it was 91%. It was 70% until Bonzo Reagan when it dropped to 50% when it stuck at 35% for the Chimp (Bush) and now Obama.


The fact is that the reason we had a progressive income tax is that the government needs a lot of money and you can't get money out of a stone(the poor).

Would you raise taxes in the event of a war?
Previous generations did, probably out of patriotism.

As for the entitlements,
Combined Federal, State and Local Welfare Budget, 1992 (millions)

Medicaid $118,067
AFDC(reduced/reformed in 1996) 24,923
Food Stamps 24,918
Supplemental Security Income 22,774
Lower income housing asst. 12,307
Earned Income Tax Credit 9,553
Veterans medical care 7,838
Stafford loans 5,683
Social Services (Title 20) 5,419
Pell Grants 5,374
Low-rent public housing 5,008
General medical assistance 4,850
Foster Care 4,170
School Lunch 3,895
Pensions for needy veterans 3,667
General Assistance 3,340
Head Start 2,753
Food supplements,
Women, infants and children 2,600
Training for disadvantaged
youth and adults 1,744
Low-income energy assistance 1,594
Rural housing loans 1,468
Indian Health Services 1,431
Summer youth employment 1,183
Maternal and child health 1,059
JOBS and WIN 1,010
Job Corps 955
Child care block grant 825
School Breakfast 782
Child care for AFDC 755
Nutrition Program for Elderly 659
Housing interest reduction 652
Child and adult care food program 624
"At risk" child care 604
$282 billion 1992 dollars
($425 billion in 2009 dollars)
The pre-crash 2007 budget was $2780 billion dollars
(2863 billion in 2009 dollars).

So all these horrid entitlements amount to something less than 14.9% of the US budget.

If you want to use your tax money to horde gold, you're certifiably crackers, Fafner.

Fafner guards the Niebelungen  horde

Well, as they say, if you're going to lie, tell a REALLY BIG lie, at least then some will believe it. So, I see you tried. Except, I don't fall for lies, just as most don't (anymore).

First, your "list" is a fatuous lie, pretending this is an exhaustive list of "entitlements". No, it isn't. You left off the really BIG one, Social Security. My spreadsheet of the budget is a little out of date, but the estimates for 2010 reveal your big lie.

Here's the real story.

The following items are all or partial "entitlement" spending. Some of it is hidden, such as student loans, which are a a liability to the federal government, and provide a no-credit-check near blank check for education. These kinds of liabilities have a future cost, and a present cost, as well, as this kind of easy money supply has caused double digit education cost increases annually for some time. Spiralling out of control, you might say, just like throwing money at health care via "first dollar insurance coverage" schemes does the same in health care.

So, in no particular order...
Social Security, costs both on and off budget: 782 billion.
veterans affairs: 108 billion
HUD: 54 billion
Health and Human services: 880 billion
Education: 101 billion
Agriculture: 133 billion

The estimate for just these combined is well over 2 TRILLION dollars.
With the exception of Veterans affairs, none of these spending / entitlement agencies should even exist. And the only reason that Veterans Affairs exists is that we promise a certain lifelong benefit to joining the military, as part of compensation for so badly underpaying military personell. This 2 trillion is mostly taken from people who work and earn an income and given to those who aren't.

Health and Human Services, for instance, is 25% larger than the whole defense budget. That's pure, unadulterated, mindless insanity. HHS should simply be deleted. As should the department of education. There is no reason on earth for the federal government to be involved in education. And please, don't give me the argument that it should, for the purpose of redistributing my money. I'll distribute it wiser and more usefully than the federal government will EVER. And you can multiply that statement times 1000 and still not be exaggerating.

All this money, the regulations on how OTHER money is spent, creates massive costs to the consumers and taxpayers that should never exist. Let the states decide if they want to duplicate this or not. Give the taxpayers a choice.

For someone who's quick to point a finger at someone else (Marjorian) and call him a liar, you seem to play pretty loose with the facts yourself.

He did list educational subsidies (Pell grants & Stafford Loans). And technically, student loans are not even government liabilities, but assets --and well protected ones at that. You cannot even discharge a student loan in bankruptcy. You either repay it + interest, or you have your wages and assets garnished and carry it with you to the grave. He also listed "Veterans medical care", and "Pensions for needy veterans". Didn't see line items for Social Security & HHS though - you win on those ones.

"HHS should simply be deleted."

Hey grandma, you want medicare? How about a quart of whiskey and a .357 with one bullet.

That's the spirit!

Actually, I kind of look forward to seeing a doctor when I'm old rather than being left to die in the streets like an animal. But that's just me.

And you somehow failed to notice the multiple trillions more just spent keeping Wall Street alive?

Big lies, indeed.

And let's not forget Iraq and Afghanistan. Corporate welfare at its worst.

Not that I am or ever was in favor of "bailouts", but what "multiple trillions" was that?

And, both Iraq and Afghanistan are dwarfed in size compared to most of the giveaway items I listed. So, again, why strain at gnats and swallow camels?

You need to spend some time at The Automatic Earth. They can educate you far more effectively than I can. But the gov't has guaranteed huge amounts of losses, for one. They have some primer type posts. Read them all.

Then, your list wasn't representative of public vs. private hand outs. Education? Health costs? Veterans? The first two are Commons and the latter is defense spending. The question I have been participating is welfare vs. welfare. Take up other issues with those that raise them.

If you're not going to take the conversation seriously, why bother?


Except that from another economic point of view,

...a tax on electrical devices over their working life that is equal to the cost of offsetting the electricity/CO2 down to the level of the best A+ or A performing devices...

would become an incredible bureaucratic and administrative nightmare unless one limited it to a very small set of the most energy-intensive mass-produced devices. The extensive information required to assess this - and to decide in the face of a great profusion of devices just which ones were comparable to the one being assessed - is not free and in many cases it would become quite controversial and politically-charged. It would become a bit like Nixon's price controls, where existing products disappeared from the shelves in favor of nearly indistinguishable "new" ones, precisely for the purpose of obfuscating comparability.

It would be a heck of a lot simpler - and more comprehensive - to offset or tax the electricity itself. But with unemployment numbers - no matter which ones you use - so huge, this sort of thing may have little traction no matter how it's attempted. As I've often said before, it's one thing to demand punitive taxation, regulation, or bureaucracy to lash out politically at "big business" for delivering the unwelcome news that one must get up in the morning and do something to earn one's God-given "entitlements" - but quite another thing altogether to demand it in order to reduce one's own standard of living. The latter ain't gonna happen much except maybe on picket signs at funky elite colleges in Vermont.

...special interests who favor light taxation of the rich and powerful...

I keep remembering how much simpler it would be if it were only the rich and powerful, but the sense of entitlement is now universal. It wasn't just the rich and powerful who voted out Carter and Mondale - they simply didn't have enough votes by themselves. As somebody said in the Wall St. Journal in the pre-Web days (and I've never been able to find a Web citation), class warfare doesn't work well in the USA because there are only two major classes: the rich and the would-be rich.

Oh, and I'm still waiting for the Utopian lefties, who piously affect to be offended by the very existence of the rich, to call for boycotts of cable and satellite TV and sports networks, and for draconian cutbacks in the scope of copyright or maybe even outright repeal. After all, TV, sports, and copyright fees (royalties) line the pockets of the very rich, while dropping only a very few sparse crumbs on the not-so-rich. But not to hold one's breath: historically, all this stuff was heard ad nauseam in the 1960s and look where that got us.

Funny, the only Utopians I've seen around here are the Libertarians.

Actually, the real Libertarians are the ones who know that we are all screwed unless we can dramatically reduce our spending right now

Former Treasury Secretary Paul O'Neill was told "deficits don't matter" when he warned of a looming fiscal crisis.
O'Neill, fired in a shakeup of Bush's economic team in December 2002, raised objections to a new round of tax cuts and said the president balked at his more aggressive plan to combat corporate crime after a string of accounting scandals because of opposition from "the corporate crowd," a key constituency.

O'Neill said he tried to warn Vice President Dick Cheney that growing budget deficits-expected to top $500 billion this fiscal year alone-posed a threat to the economy. Cheney cut him off. "You know, Paul, Reagan proved deficits don't matter," he said, according to excerpts. Cheney continued: "We won the midterms (congressional elections). This is our due." A month later, Cheney told the Treasury secretary he was fired.


I'm missing the joke I guess. Neither Bush nor Cheney are anything close to Libertarians. O'Neil was fiscally conservative/responsible. His firing was one of many poor decisions made by our Neo-Con president.

From Wikipedia:

O'Neill was appointed Secretary of the Treasury by George W. Bush. O'Neill was a somewhat outspoken member of the administration, often saying things to the press that went against the administration's party line, and doing unusual things like taking a tour of Africa with singer Bono.

A report commissioned in 2002 by O'Neill, while he was Treasury Secretary, suggested the United States faced future federal budget deficits of more than US$ 500 billion. The report also suggested that sharp tax increases, massive spending cuts, or both would be unavoidable if the United States were to meet benefit promises to its future generations. The study estimated that closing the budget gap would require the equivalent of an immediate and permanent 66 percent across-the-board income tax increase. The Bush administration left the findings out of the 2004 annual budget report published in February 2003.[citation needed]

O'Neill's private feuds with Bush's tax cut policies and his push to further investigate alleged al-Qaeda funding from some American-allied countries, as well as his objection to the invasion of Iraq in the name of the war on terror — that he considered as nothing but a simple excuse for a war decided long before by neoconservative elements of the first Bush Administration — led to his resignation in 2002 and replacement with John W. Snow.

So... tell me where the Neo-Con Republicans were right and O'Neil was wrong.

So, while you're whining about "neocons", which is just so much noise, could you explain how Democrats are better at reducing spending than was Bush, who wasn't a fiscal conservative? Most of them are pretending that pork barrell spending on do-nothing project is "economic stimulus". And that we need a LOT more than we've had.

So, while you love to scream at the so-called "neocons", what IS your answer?

Look, an honest analysis puts most of this bubble at the feet of the republican idiots who ended glass-steagall, turned a blind eye to oversight, created all these ephemeral "securities" and shorted their own customers.

To then attack the Dem president left to try to do something, anything, to limit the damage is just so much crap.

Deal with it.


LOL, "Honest analysis"? What are you smoking? that bit of mindless propaganda may sell to the ignorant, it won't play to anyone paying attention.

US Government: 13 trillion in debt. If Obama remains president and Democrats retain Congress for 6 more years, expect that to be 25 to 28 trillion.

Fannie and Freddie, about 6 trillion of loans peddled to the marketplace. More than 1 trillion being subprime.

total mortgage debt in the US, about 13 trillion. You're whining about Glass-Stegall? The level of blame which goes to that... is so small as to not be measurable. Yes, oversight and reigning in fannie and freddie was tried, but blocked by the GOP... No, Democrats blocked any effort to reign in the reckless and utterly insane amounts of debt being incurred with the resulting cash pumped into real estate and related economy.

Am I promoting the GOP? No. Bush compromised with Democrats. The GOP failed to start paring down the number of federal agencies and reducing employment and overall spending. The federal budget needs to be reduced by 60 to 70 percent.

I'm merely pointing out that your post is just pure fiction. There are elephants in this room, and none of them are GOP elephants. Every one of them is directly the 'fault' or rather a direct creation of the federal government and it's completely oversize and deadly influence in the marketplace.

Can you, in any way, expect to have a working economy if you tax business more and more? Please explain how increasing the cost of domestic economic activity in favor of importing is a good thing? I mean, you seem to love the "tax the big corporations" emotional manipulation, but we don't need emotion, we need employers, jobs, and business, and we need it beyond the term 'desperately'.

We punitively tax work, employment, investing, growing a business, and punitively tax owning and operating your own business. It's as if we don't want anyone to have a job or create their own. Why? As a business owner, I am SO sick of intrusion into everything I do. The level of intrusion and the incredible cost of everything related to trying to earn even a pittance is pure insanity. Although the need for what I do exists, I'm seriously considering stopping growth so I don't have to endure the monstrous insanity that happens when you hire someone.

The engine of our economy is the growth of employment. Employment is grown by growing business. We tax employment, growth, and everything related to growth. Why? Why tax what you want to happen? Because politicians want you to suffer, so that they can promise to help you with someone else's money. And you'll be stupid and vote for them.

Yes, we did, many nations do. The Commons is far more important than individual ownership. Balance is needed, for now there is zero balance to the system.

"The engine of our economy is the growth of employment. Employment is grown by growing business. We tax employment, growth, and everything related to growth. Why? "

That kind of economics is dead, whether its practicioners know it or not.


LOL, you promoters of planned economies are so hilariously funny. Planned economies are the biggest joke of the last million years, never having worked, unable to work, and simply impossible, yet, you have faith in them.

So, what religion is this, and who are your priests, and what rituals do you do that cause people to become delirious and start saying this stuff?

Your definition of "balance" is truly the stuff to induce gales of laughter. And rivers of tears, for those subjected to it by force.

Undertaxed? How could ANYONE be undertaxed? You can't be taxed less than nothing, and nothing is perfectly good.

My, my what an outpouring my little post created when I was proposing one simple idea to improve electrical efficiency. I didn't mention it but the intention would be to encourage manufacturers to quickly make their devices as efficient as possible once that the lifetime cost was no longer hidden. Here in Yourop (European Union:-) household appliances already must show the European Union energy rating label which has an efficiency rating from A (best) to G (worst). It shows a typical consumption in kWh per year with other relevant information e.g. noise level.


In fact since the label has been introduced it has lead to efficiency improvements and three new classes (A+, A++ and A+++) will be introduced early next year - don't ask me why they just didn't make it A to J. Actually I know its because manufacturers didn't want their devices "downgraded"!

It would therefore be a very easy step to calculate a lifetime cost of the CO2/electricity and it could no longer be hidden from the eventual users. To an extent this is already being done for cars so these sorts of taxes are feasible. In the UK cars are graded in 13 bands depending on CO2 emissions expressed as g/km with thirteen bands from less than 100g/km to more than 255g/km and an annual tax is charged from free to GBP 425.

Energy analysts remain concerned about the demand for oil, despite the fact the US summer driving season has started, and the Arabian air conditioning season has also been underway for a few weeks:

Jul 5, 2010 17:29 AEST
Crude oil slumps due to economic fears


Granted that OPEC supply is a little stronger than expected:

OPEC Sailings Seen +190,000 B/D In 4 Weeks To July 17-Tracker
First Published Thursday, 1 July 2010 04:44 pm - © 2010 Dow Jones


However will that small increase make up for the loss of supplies caused by bad weather in the GOM?

Regular readers may have noticed that I have been providing a fairly detailed interpretation of the EIA weekly inventory report. I will be the first to say that the EIA inventory figures on a weekly basis can be off considerably. In fact, at any given time, they are probably off by up to about 6 million barrels either way (for the commercial oil stocks). As a side thought, I realize it is up for debate whether we will miss the big picture by looking too closely at the details, but the value of TOD to me is providing those details that I may otherwise not know about.

Based upon many Gulf of Mexico oil production platform closings last week, and the under-reported closing of the Louisiana Offshore Oil Port (LOOP) for about 3 days, there will be a substantial fall in oil inventories in the next EIA report (which I believe will be available Thursday). Lost US oil production is about 1.1 million barrels, but another 3 million barrels of oil in transit to the LOOP may have been delayed. Due to the unique ability of the LOOP to offload supertankers, it is unlikely the tankers headed for that port were diverted elsewhere. In addition, Mexico also shut in some production and also closed some oil export terminals - not to mention some other US oil importing terminals were closed.

Therefore we should expect an unusual drop in oil inventories of at least 5 million barrels more than what would have otherwise occurred without Hurricane Alex. It’s possible that in later weeks, weather permitting, that delayed imports will reach port and total inventories will not be affected much in the long run. But don't bet on that - it appears that mother nature won’t be ‘permitting’ smooth sailing in the GOM this summer.

LOOP closes:

LOOP opens:

Hello Everyone,
Did anyone else notice that the general theme of a large % of these articles actually shows companies/countries DOING (or trying to) something about the upcoming energy crisis/environmental impacts? There is currently the moratorium that Saudi Arabia has issued, as well as this new moratorium that Indonesia has placed. However well intentioned Saudi Arabia's moratorium is, I can't imagine it will succeed, analysts are already "greying" what the King said.

But at least it appears that people might be starting to wake up around the world?


edit: of course it could also just be the particular articles chosen today, I'm not sure how TOD picks articles for the drumbeat, but that could lead to the same...

It is hard to get very good solutions.

Better insulation and smaller cars will reduce oil and gas use, but don't eliminate the problem. It takes years and considerable investment to phase in smaller cars and other changes that would reduce oil use. Furthermore, most f the"green energy" solutions are "fossil fuel extenders". For example, wind and solar help natural gas supplies go farther.

But long term, neither of these are really likely solutions. We need oil and other fossil fuels to run our system, in the way we are accustomed. For a long time, the world operated without fossil fuel (or using fossil fuel only in tiny quantity).It seems to me that eventually we will need to head back to a system that doesn't use fossil fuels--perhaps animal power will be used more.

Furthermore, most of the"green energy" solutions are "fossil fuel extenders".

Simply false.

As has been argued multiple times. We became accustomed to oil and we can become accustomed to alternatives.

Technology will not disappear everywhere. Roman engineers would have MUCH more effective with just hydraulic jacks (for sale for $20 today, easy to fabricate once you know how).

Electric motors, wires and batteries will not disappear (even in areas with massive die-offs). An electric delivery truck, batteries charged from solar PV and/or wind, will work much better (and use *FAR* fewer resources) than mules drawn wagons for local deliveries from the rail depot.

We could, in the year 2187, be running out of the fossil fuels that "fill the gaps" for 2.4% of all power generated and simply need to learn how to do without electricity for 160 hours/year. 100% renewable but not 100% of the time. No FF, just do without and adapt.

More likely, in just 50 or less years, we will develop new technologies (such as geothermal that can be throttled up and down as needed) that will allow us to phase out the last fossil fuels from our grid.

In the meantime, we need to conserve and become more efficient while steadily increasing the renewable share of the grid from 8% to 12% to 30% to 50% to 78% to 85% to 93% to, one day, 100%.

Best Hopes for a Rush to Wind, with growing subsidies to keep the growth rate high, along with increased transmission and pumped storage,


PS: Switzerland, with cheap and available fossil fuels, in 2007 generated a token amount of electricity from oil & gas (both "other renewables" (mainly biomass) and net exports of electricity, were triple the oil & gas generation). Roughly 60% hydro, 38% nuclear. 2% other (mainly biomass).


1/3rd of the freight and 1/6th of the passenger-km were by electrified rail. Only 3% of total transportaiton energy was needed for electrified rail.

Switzerland is on a twenty year, 31 billion Swiss franc program to increase the modal share of electrified rail.

Are you telling me if the Swiss install wind and solar PV (which they have since 2007) that these are just "fossil fuel extenders" ? WHAT FOSSIL FUELS ARE THEY EXTENDING ?

And are you also saying that Switzerland could not build and install solar PV (or wind) without large amounts of fossil fuels ?

I would say "Simply false" if you did.


most of the "green energy" solutions are "fossil fuel extenders"

Then by definiton we create more time and ability to raise the investment for:

It takes years and considerable investment to phase in smaller cars and other changes that would reduce oil use.

I can't understnad how you can dismiss green energy as meerly a fossil fuel extender, when what we need right now is to extend our fossil fuels as long as possible!

What we need is to get off fossil fuels as soon as possible. whichever countries can do that first (and it would seem Switzerland and maybe Sweden are closest), while maintaining and civilised lifestyle, will win.
They will be out of the mug's game of competing for a diminishing resource, and can worry about all the other things of modern life.

Mecca (Makkah) Metro starts limited operation

One small step back for ELM.

The partially completed "Sacred Rituals" Metro (design is 18 km of elevated rail) will be in service this Haj.



The second link has some details of other Saudi rail projects.

I did learn one detail. Residents of Mecca (Makkah) do not need to make a pilgrimage (Haj) but they should participate in stoning the devil.

Best Hopes for More,


Melting ice fields pose serious threat to water supply in Asia

There are fears that in 25 years, 80 per cent of local glaciers will vanish as warming bites, writes CLIFFORD COONAN in Tibet

I thought that 2035 date had been discredited as a typo of 2350. Things are bad enough without reporters resorting to misleading articles. The truth is plenty bad.

You are mistaken. The "problem" with the IPCC report was one of attribution, not conclusion, and the 23~~ thing is a figment of your imagination.

Why can't people get it through their heads that the IPCC IV was based on science that is now a minimum of five years out of date? What we have learned about ACC since then is leaps and bounds ahead of what we knew then. Also, try not to forget the IPCC IV is conservative on its scenarios.

Some 80% of glaciers globally are melting. Some have already disappeared. 2035 is optimistic, believe me: the effects of warming are far more pronounced at latitude *and* altitude. That is, the ice goes first.

I've been warming people for years here and elsewhere. Mearns, Bardi, Aleklett, Rutledge, all of them... dead wrong. To wit (brand new research):


Forest at the poles at 400 ppm CO2. We're at 390+.

Good luck with that.


I've been warming people for years here and elsewhere.

truly a Freudian Slip...

If you hadn't responded I might have noticed and been able to fix it, damn you!

Thanks for the laugh.



I went back and read the realclimate post on this. They say:

Himalayan glaciers: In a regional chapter on Asia in Volume 2, written by authors from the region, it was erroneously stated that 80% of Himalayan glacier area would very likely be gone by 2035. This is of course not the proper IPCC projection of future glacier decline, which is found in Volume 1 of the report.

Realclimate: http://www.realclimate.org/index.php/archives/2010/02/ipcc-errors-facts-...

It looks like the 2350 thing was reported by the BBC:

BBC: http://news.bbc.co.uk/2/hi/8387737.stm

Michael Zemp from the World Glacier Monitoring Service in Zurich also said the IPCC statement on Himalayan glaciers had caused "some major confusion in the media".

"From a present state of knowledge it is not plausible that Himalayan glaciers are disappearing completely within the next few decades. I do not know of any scientific study that does support a complete vanishing of glaciers in the Himalayas within this century."

I'm on your side, man. I think AGW is a big F'n deal. That's why I get bothered by unnecessary sensationalizing using distorted information.

It's not distortion. 80% are melting. When they finish melting isn't the mos important metric. What of all the years as they dwindle?


Thanks for the link to the paper by Ballantyne, et al. I noticed one apparent error though. They write:

This pronounced Arctic tail in the latitudinal temperature gradient can be explained in part by a greater ice-albedo feedback in the Arctic compared to Antarctica. Ice has a much higher albedo (~0.7) (Lindsay and Rothrock, 1994) relative to the ocean (~0.07) (Payne, 1972) than it does relative to forest (~0.1–0.4) (Betts and Ball, 1997).

The trouble is, Payne's work did not find this low albedo for the ocean when the zenith angle becomes large (or solar "altitude" becomes small). Just like a sheet of glass becomes a good reflector at large zenith angles, water also exhibits a high albedo when the sun is low in the sky, which occurs often in the Arctic. At the North Pole, the solar "altitude" angle never exceeds 23.5 degrees and that only occurs at the Summer Solstice. A month or two on each side of the Summer Solstice and the solar "altitude" angles for the Arctic Ocean are quite small throughout the day.

E. Swanson

2/3 of melt is from the bottom. June is the most important month wrt albedo. Splitting hairs, Ron. What's the point of debating a percentage point or two of albedo when the whole damn thing is going faster than virtually anyone predicted? Albedo or otherwise, it's going, and we're quickly approaching the point where the "why" approaches irrelevance.


I certainly agree that the sea-ice is melting rather rapidly. That said, I think that the model builders still need to get it right. If the sea-ice is not melting due to a large difference in albedo, then there must be some other process going on, such as melting from warm water below. That would seem obvious, but getting models right is a prerequisite for getting the projections of the future right as well.

As I've repeatedly mentioned, my feeling is that we are changing the tropic to pole circulation in the ocean. That process may also result in more warm water entering the Arctic Ocean and melting the sea-ice from below. I think, as a result, the future climate will not be what the model builders have claimed, even though at present there's no clear difference. On reading the report in SCIENCE from 25 June ("The Last Glacial Termination") about the Eemian transition, one must wonder exactly why the Eemian only lasted some 10k years, compared with our present interglacial, the Holocene. Was it important that the Eemian was just a bit warmer than present? Or, have mankind's other alterations in the natural world extended the Holocene beyond what might have otherwise happened. I'm afraid that we won't know until we are stumble upon the truth as things change around us.

BTW, I'm not Ron...

E. Swanson

Agree with everything, just don't think the albedo issue is going to be any degree of game changer. And the waters are already infiltrating up to Greenland... and beyond, I am certain.

Did you see what I posted wrt CO2 and temps during the Pliocene?

Three big stories in the last 24 - 48 hours. The top is going from a wiggle to a wobble.

Hang on.

Oh, yeah, caught the name thing, but you had responded. Sorry.


Models only work when you understand what is going on in the first place.

I see this all the time, people saying that the climate models are sucky, and can't tell the real story. It is just like our understanding of how our own body works, how the brain works, why we need sleep, how the universe is working and a lot of other things in life that we have no real clue what is going on, and we are still trying to make models to predict future happenings.

HOW in the world can you get a model to tell you something when you do not understand the full process at the root of the question?

I can build a model, (computer program that looks at where a system will be in some time in the future, with this or that string pulled here or there, to see where the bits all change) Of what will happen on a pool table when I break the rack of 8-Ball. And I would get a pretty good model of where things are going to in the future. But if I were to not know where the 7,3, and 15 balls are and had changed their weights and sizes, to represent unknowns in the system. All my modeling is for naught.

We have that going on in Climate, we have that going on in the Oil patch, and we are fussing over the results of this or that study, when most of them just do not have the needed information yet.

But we can see results happening, As a Climber ( I do what is known as bouldering, and rock jumping, also caving) I know that the Ice routes in the mountains of the world that climbers have been on, have been dissappearing over the last few decades, and it scares them, and they write about it. It has been going on, in the background for a while.

Change is afoot and we just party on like nothing is going on in our world.

I think we need to really get off our soapboxes and realize that whether we like it or not, the world around us is changing and likely it is changing in more ways than we even suspect and it is not going to be pretty when we are all caught off guard when systems that we have thought were stable fail to be stable. After all nothing in the natural world is really stable and unchanging. Just watch a seacoast for a while and tides and storms move the sand and rocks and corals grow and die and wind and rain move things about, Change is a normal thing in the world.

But we have a short lifetime memory and it is not the same as even that of a tree, which can grow for up to 4,000 years, but even more normal lifetimes are 100's of years. We just think we know it all and have this superiority complex, that blinds us to the facts, that we don't know all there is to know and what we do know, does not amount to a small hill of ant dirt.

BioWebScape designs for a better fed and housed world,
Hugs to all.

"At the North Pole, the solar "altitude" angle never exceeds 23.5 degrees and that only occurs at the Summer Solstice."

Another way to put it is that absolutely every other point in the Arctic (and beyond) DOES exceed 23.5 degrees.

That being said, it has been well established that there is indeed much going on in the Arctic beyond sea versus ice albedo difference.

Black carbon and other dark particulates have played a major roll in the melt (this was covered in a realclimate thread about a year ago).

There is indeed more and deeper intrusion of warm Atlantic water into the Arctic.

IIRC, shifting wind and ocean currents are also moving more ice out of the Arctic.

Another feedback is that the more open water there is, the more and bigger waves can develop, and these break up thin ice more quickly.

Methane feedbacks on land and in the sea seem to be kicking in...

It's a big complex mess, but there is no question that increased GHGs do play a central roll in kicking off a lot of these changes.

Ice coverage has been going down steadily for years, but recently ice volume has broken away from its long term linear decline and looks to be going into a rapid collapse. But maybe this will recover or revert to a linear for any number of possible reasons.

[Edit--after thought--the absorption at the pole is not really of much concern. It is the absorption over the vast continental shelves around the southernmost rim of the Arctic Ocean where solar absorption can lead to rapid ice loss, melting of clathrates, and ensuing catastrophe that is of greatest concern. These lie mostly between the Arctic Circle (66.33 degrees) and about 80 degrees. So, for those of you more math literate than I, do I get the angle of incidence for these latitudes by adding the difference between them and 90 to the 35 degree number given for the North Pole? (So about 60 degree angle of incidence on the solstice at the Arctic Circle? Or I guess this would be the grazing angle? My trig is not what it used to be.)]

During the Summer Solstice (21 June this year), the North Pole has a solar elevation of 23.5 degrees for the full 24 hours of the day. Moving away from the NP, say to 80N, at local noon the solar elevation is 33.5, but at midnight, it drops to 13.5 degrees. Moving further south to 70N, at noon the solar elevation is 43.5, but at midnight, it drops to 3.5 degrees. So, over a 24 hour period, the variation in albedo due to the solar elevation can become rather important, even at the edge of the sea-ice which you mention.

Of course, between the Fall Equinox in September, and the Spring Equinox in March, the NP receives no direct solar energy.

E. Swanson

Thanks for the clarification.

Would you say that there would be a lot of reflection off water at a solar elevation of about 45 degrees?

No. Look at the graph in my post above about Payne's work. But, the problem is that in the example, the sun is above the horizon 24 hours a day, so one should calculate the effects over that entire period. Also to be considered is the effect of the angle on the horizontal illumination, as the energy of the direct beam which reaches the surface is a function of the cosine of the zenith angle. Worse yet, there's the indirect component of sunlight due to scattering, aerosols and clouds to consider, which would result in a lower albedo as the zenith angle could be much different from the direct beam.

E. Swanson

It is the absorption over the vast continental shelves around the southernmost rim of the Arctic Ocean where solar absorption can lead to rapid ice loss, melting of clathrates, and ensuing catastrophe that is of greatest concern.

Actually, wrt sunlight, the shelves are the ultimate because they have the potential for sudden, very large eruptions, but they are more affected by ocean heat content than sunlight. Arctic amplification, and the effects of ice melt, are felt as much as 1k miles or km inland. This massive methane sink is undergoing serious melt, too.


Actually, some glaciers are un bad shape and other are growing. It depends on the local conditions. Also, some place received their water from glacial melt, while others from rain.

Actually, some glaciers are un bad shape and other are growing. It depends on the local conditions.

You are implying that everything is neutral, some growing and some shrinking, no problem. Everything is equal. Well I just don't believe it. Got some evidence? I suspect that CCPO is right, 80 percent are melting and the rest are likely holding their own. I doubt seriously that very many are growing very much.

And please don't insult our intelligence. We know there are lots of places in the world with no glacial melt. I live in such a place, Florida. Glacial melt is a problem where people depend on glacial melt for water, like Tibet. That is what the article was talking about. Telling folks that some people don't get their water from glacial melt is not something that will shock very many people.

Ron P.

A general question about coal. Does anyone know of a discovery model for coal like the dispersive discovery model for oil and gas?

I know that WebHubbleTelescope, Khebab, and Stuart all have models for oil and gas discovery, is the same model applicable to coal? Or does the nature of the resource, veins as apposed to reservoirs, affect the rate of discovery?

Unfortunately I have never seen discovery data for coal. I definitely have seen the production data.

Coal has the additional categorization of grades, anthracite, bituminous, to lignite. It certainly is not quite as homogeneous a gradation as oil. So prospectors will find all the grades without being able to discriminate grades, but then the production will proceed according to profitability. So I would think you would need the discovery profile separated into the 3 categories, at least.

Otherwise the discovery model should be exactly the same. It is a purely spatial-based model so it doesn't depend on what you are looking for.

Thanks WHT,

Purely spatial model is what I needed to know. I am modeling this as a predator prey relationship where the economy preys on resources. Converting that relationship into an economic production format gives what amounts to a decreasing ERoEI. As the resource base is consumed more capital, labor, and energy need to be deployed to maintain a constant output. Or a constant level of capital, labor, and energy yields lower output.

You could map that to mining large seems of coal, then small seems, then mountain top removal or mining anthracite, then bitumimous, then lignite. The same thing holds for oil and gas. From light sweet to heavy sour to tar sands and from on shore to off shore to deep water.

Thanks again.

Illinois Stops Paying Its Bills, but Can’t Stop Digging Hole

For the last few years, California stood more or less unchallenged as a symbol of the fiscal collapse of states during the recession. Now Illinois has shouldered to the fore, as its dysfunctional political class refuses to pay the state’s bills and refuses to take the painful steps — cuts and tax increases — to close a deficit of at least $12 billion, equal to nearly half the state’s budget. Then there is the spectacularly mismanaged pension system, which is at least 50 percent underfunded and, analysts warn, could push Illinois into insolvency if the economy fails to pick up.

States cannot go bankrupt, technically, but signs of fiscal crackup are easy to see. Legislators left the capital this month without deciding how to pay 26 percent of the state budget. The governor proposes to borrow $3.5 billion to cover a year’s worth of pension payments, a step that would cost about $1 billion in interest. And every major rating agency has downgraded the state; Illinois now pays millions of dollars more to insure its debt than any other state in the nation. “Their pension is the most underfunded in the nation,” said Karen S. Krop, a senior director at Fitch Ratings. “They have not made significant cuts or raised revenues. There’s no state out there like this. They can’t grow their way out of this.”

From the referenced article :-

"More broadly, Illinois is caught between blue state convictions about social safety nets and a red state aversion to taxes. For years, the Democratic-controlled legislature has passed budgets that are, in effect, in deficit. Lawmakers routinely skip around the state’s balanced-budget law, with few consequences. (Republicans are near monolithic in voting against any tax increases and borrowings. When one broke ranks to try to keep the pension solvent, he was stripped of a committee position, reducing his pay and pension.) "

Clearly, we have to do both - cut programs and raise taxes.

What keeps happening is that "business groups" fight tax increases, raising the fear card that businesses will leave the state, and jobs will be cut.

Meanwhile, educators keep asking for more money - which, in Chicago, ends up in raising real estate taxes, since Springfield refuses to fund things like public education and transit.

Businesses and large condo buildings hire real estate attorneys to lobby the Assessor to get their taxes reduced. Homeowners apparently have the least amount of leverage in getting tax breaks, until they can't pay the bills any more, and end up in foreclosure.

My real estate taxes have gone up 80% since I moved into my house in 2006. Yes, eighty percent. There was a 7% cap in annual increase for homeowners assessments, up till 2007 - voted down. I guess we are the easy target.

The state has a flat rate of 3% income tax. Proposals have been floated to raise that to 4.5%, with some breaks for folks on the lower end of the income scale. Needless to say, that idea is going down faster than a lead balloon !

It goes around, and around, and around. And, of course, nobody wants to do anything politically dangerous in an election year....

Clearly, we have to do both - cut programs and raise taxes.

And at the risk of exposing my biases -- the quickest way to cut spending significantly is to get out of Iraq and Afghanistan and then reduce defense spending to a sane level given our size, rather than having an annual defense budget roughly equal to the combined defense spending of the rest of the world.

Perhaps, but this would not alter Illinois' problems.

I wonder if perhaps the best course of action for Illinois would be to just go ahead and default on various governmental obligations, rather than trying to pretend that BAU can be maintained.

Not rocket science.

Illinois spends $33 billion and gets $25 billion in revenue. Result a $7.2 billion dollar shortfall(2010).

Increase the income tax by 33% and the books are balanced. Illinois income tax is 3% so go to 4%, which as similar to other states.


About 3% of the budget goes to debt service, so up to now debt financing has been the legislature's favorite way of balancing the books.


One problem is the local property tax rates which are a killer, so the issue is difficult but Quinn's plan would certainly work.

But Republicans will demagogue him to death and he knows it.


Now Illinois has shouldered to the fore, as its dysfunctional political class refuses to pay the state’s bills and refuses to take the painful steps — cuts and tax increases — to close a deficit of at least $12 billion, equal to nearly half the state’s budget.

Why does the NYT refer to the deficit as "Equal to nearly half the state's budget?"

In any case, the monster that is going to increasingly consume more and more of local and state government budgets is vastly underfunded pension programs.

It's the slow drip, drip, drip of economic contraction. Yesterday my wife and I spent a quiet evening looking at the stars...not watching the 4th of July fireworks which has been a tradition on the beach in Oceanside for over 20 years. Last year there were over 100,000 showed up for the celebration. This year no money, no fireworks. But we're not the only municipality cutting back:

Firework Funds Fizzle Out Fireworks manufacturers say that business is down over 30% from last year. What are you going to do when all of that imagined wealth disappears?


12 billion was last years Illinois state deficit 2009, this year 2010 it's 7.2 billion. Last year's deficit was paid for by borrowing.
Not a good policy but it's what you must do in bad times.
I agree that the General Assembly has been somewhat irresponsible on spending but a lot of this is due to the economic crash that magnifies many problems.

The issue of state pensions is the $61 billion in unfunded liability for state employees, teachers, judges, university employees and politicians/general assembly which is 40% funded.

Here the problem is partly the crash in value of market assets that backed up the pension system.

In the future, employees will just have to pay out more in their withholding for smaller pensions(they don't get SS).
It's a long term problem but once it is properly renegotiated it goes away.


Nice try, but it actually is rocket science.

Raise income taxes, and you hamper private spending. So initially you might balance the books, but eventually revenue will decrease as those with means start to hoard money or leave the state.

Moreover, as our economy continues to decline down Hubbert's curve, what are you going to do? Raise income taxes to 5, 6, 7, 8%? Good luck.

Spending must be cut. The bloated government must be cut down to size, using any means necessary.

I have nothing but admiration for the Schwarzeneggers and Camerons of this world who have the courage to do this.

From what I see in my social circle, private spending is toast anyway. We're all delevering, that is paying down any and all debts, including mortgages. A tax hike will only slow down that process while helping the state government pay down its own debts.

Illinois spends $33 billion and gets $25 billion in revenue. Result a $7.2 billion dollar shortfall(2010).

Increase the income tax by 33% and the books are balanced. Illinois income tax is 3% so go to 4%, which as similar to other states.

Income taxes account for only a bit over a third of Illinois' General Fund revenue. In really round numbers, they would have to almost double their income tax rate to close the gap if that was the only change they made. There are states with income tax rates at or near 6%; but doubling a tax rate is likely to cost you politically when the next election rolls around.

Some other state actions regarding tax increases over the last couple of years (eg, Oregon, Arizona, and others) suggest that you can cover about a third of the gap with tax increases and get voter approval, but the other two-thirds has to be program cuts. And some of the things that have happened suggest that you need to have committed to the cuts before you do the tax increases.

Tax receipts continue to drop from $18 billion FY 2009 to $17 billion FY 2010.
Sales tax is about $5 billion.
The State lottery and Riverboat gambling contributes 300-700 million per year.
It also gets 5.4 billion dollars in federal revenue sharing for FY 2010.


Corporate and personal income taxes amount to 54% of the total revenues, so doubling the state income tax
would cover the 7.2 billion deficit. I admit that 33% income tax increase alone would not cover the deficit, a moving target but if sales AND income taxes were increased 41% the deficit would be covered.

Quinn also is recommending sales tax increases and has reduced agency spending by 10.5% and it is expected that money sent to local governments will be sharply reduced just as federal pass thru money to states has gone down.

About 44% of the state budget is for health, disabled, mentally retarded and other social services, 33% for education and 15% is for transfers to debt service and local revenue sharing.
It's hard to see where to cut.

Up to now the state has reduced costs by stopping payments to contractors which is ethically wrong.

Cutting such expenditures to spare yourself a tax increase seems to be the epitome of selfishness.

Our ancestors were far more generous.

Yeah, they let them starve. When they can't walk to a refrigerator to get food maybe they'll starve again. Perhaps we'll be back to that in a few decades.

To really present the absurd...

1) Have Illinois foster a terrorist group or two
2) Pull off some well placed false flag operations
3) Have the Governor close all public speeches with "Death To America"
4) And watch the military pour in with billions in reconstruction funds
4a) (Have some resource worth appropriating, does coal still count? Stanley Cup winning team? The Bulls are a shadow of their former selves.)
5) Posse Comitatus be damned.

Not that I'm an historian by any means, but given the trajectory of Illinois in relative wealth and demographics, would the State not be a preview of the failing empire to come? It seems these once prosperous states cannot make the hard decisions due to the inertia of politics and social structures.

Ah, the "Mouse that Roared" strategy.


Exactly!! That's the movie I was trying to remember. Haven't seen it since I was a kid.

Even better would have been to start two years ago, when the revenue collapse began. Be that as it may, the hard part is deciding which obligations to cut. Major General Fund spending categories from Illinois' 2011 original Governor's Budget Book:

Category Percentage
Education 33.7
Healthcare and Family Services 32.3
Human Services 23.1
Public Safety 5.9
Government Services 4.0
Economic Development and Infrastructure 0.8
Environment and Business Regulation 0.2

Given the magnitude of General Fund savings they're looking for, there are only three broad areas where they can make the necessary cuts. They could wipe out the rest of the state government entirely and not close the gap, so it's got to come from their big three. Perusing their budget book a bit more closely suggests that they spend little or no GF on transportation, depending on fuel taxes and federal revenue. The overall spending/funding pattern is typical of most state budgets.

I'm not familiar with Illinois' constitutional provisions on spending, so there may be some restrictions on what spending the Legislature can cut and by how much. Many states protect K-12 education. Some state constitutions (eg, California) put repayment of public debt very high on the priority list. The new federal health care reform act has locked-in the Medicaid eligibility standards, so the only way Illinois can cut that is by cutting reimbursement rates (or withdraw from Medicaid entirely).

I have said before (and will continue to say) that at some point states have to start bailing on Medicaid. They may replace it with some very basic health care system for the poor, but an entitlement program with costs rising faster than state revenues, combined with a balanced budget requirement, is unsustainable. Everyone who looked at the financing seriously knew that when the program started, but they all said "Oh, we'll deal with that when the time comes." Now, 45 years later, the time has come.

The book has a bunch of interesting information. The state pension fund gets lots of press; it may be worth noting that >83% of the workers currently participating in that are K-12 teachers and university staff. >70% of those receiving an annuity are former teachers and university staff.

Other viable options are to raid the Special Funds (no new roads and low down on repairs) and new taxes.

Inheritance taxes the dead, who vote less often.

Gas taxes are a generally good idea.



I was assuming that all the special funds that could be raided had been. Here in Colorado, that was pretty much the first thing that got done. Don't know about Illinois, but here the constitution requires that all gas taxes go to the Dept of Transportation and be spent on transportation-related projects.

Most state budgets are accounting nightmares. Quite literally hundreds of funding sources, most with restrictions on use. Hundreds of programs. I worked for three years as a legislative budget analyst (including the first session after revenues began to collapse) and here the accounting detail shows up in the budget bill: every funding source for every program is broken out, and staff are responsible for ensuring that all the rules are followed, special funds are going to have as much money in them as is being appropriated, etc.

The budget process drives former business people who get elected to state legislatures absolutely crazy.

Inheritance taxes the dead, who vote less often.

Not in Chicago.

And what did we get with that "education?" Scientists and engineers and solar panels and wind turbines and nuclear plants and electric cars?

No...we got MBAs and investment bankers and lawyers and consultants and corporate lackeys and offshoring and high fructose corn syrup and 500 cable channels and $600,000 McMansions in the desert and SUVs.

And we think the Chevy Volt is going to save us.

We're toast.

It seems the we are toast comment just makes one(me) think about getting the jam and butter out to make breakfast.

Down thread I posted( late I know) about not forgetting to enjoy the sun rise, then while getting up to do something I made a fast short story about Billy and how the Sun did not rise that day.

Seems Billy gets up before the sun most days, but this morning it was rather dark for 5 am, no street lights like normal, but yet his clock was still working.

After getting dressed and going for breakfast he noticed it was still dark out the kitchen window, so he went outside only to see stars out, he called the time number and sure enough it was 6:15 am. Then he called his friend Mac( OldFarmerMac you'll like this one) from his Online forum addiction(TOD), cause he is 2 hours east and he'd see the sun for sure.

No go, mac was not answering the phone, odd things billy thought.

... That is as far as the story went before I got off doing something outside. I think I'll make it a doomer story, about the sun getting blocked or Kinda blinking out or some such thing, Science Fiction is that way, you think of a neat story line, then think of 50 other ones all while trying to make your first one work out to an actual story that makes it to paper form. LOL I have 53,000 possible story lines all rattling about in my head if I let them get out of their locked box in the corner of the control room in my head.

We are toast.

But for me the thoughts run on the problem of too many people not taking care of their animals( pets) and letting them breed, Gee where have I heard that line of thinking lately? A nieghbor let her cat get preggers, another nieghbor wanted the kittens, another cat got ahold of the newly weaned youngins and claimed them for her own, now they are under one of my sheds, and the adult is killing the local birds to feed them, my dad hates cats, I like them and I don't want them running around loose killing my birds( I like most animals, and if they are around my area I kinda claim them as mine even though they are just as wild as the next batch).

So when the effort can be done I will smoke them out, like you do people holed up in a house or cave, (real smoke, like you might use for bee keeping, got to ask around about that though, I don't need real fire around the tender box of a yard though,,, problems always problems, makes life a pretty interesting place, Gotta love it. Smiles, Yes I am happy about the challenges of the days ahead. It is like trying to figure out how to climb down a cliff face, after you lost your rope. (Giggles in the way most people would see me as a bit off in the head).

Hugs from this cloudy hopefully rainy world.
BioWebScape designs for a better fed and housed world.

This always reminds me of New York State politics. In both states, you have a huge city that's "blue", and the rest of the state that's "red", in terms of the perversely reversed US color-scheme for these things. New York City is relatively bigger and much more able to have its own way but there's still considerable similarity. In both states, people in the outlying areas see little reason to subsidize the follies of the big city, such as astronomical fringe benefits and wages for bus and train drivers and other bloated, very lightly skilled staff. Conversely, the city folks often see the outlying areas as alien hicksvilles (aka "flyover territory".) Never the twain shall meet.

Maybe the solution would be to split these states in two, I dunno. The argument that would ensue over the politics of the additional Senate seats would certainly be entertaining.

Trouble with that argument is that 65% of the population in Illinois resides in the general Chicago metro area, thus most of the tax revenue is generated there.

Downstate is, generally speaking, the beneficiary of Metro Chicago tax revenues.


Downstate is, generally speaking, the beneficiary of Metro Chicago tax revenues.

Perhaps. But politics is about perception and they don't see it that way. Not in upstate New York either.

Perhaps. But politics is about perception and they don't see it that way. Not in upstate New York either.

Yeah, I hear the same thing from my relatives in rural areas.

Ignorance is no excuse. With the general exception of states that have major extractive industries, urban/suburban areas subsidize the roads and education systems in rural areas. For the most part, the counties with the highest public assistance caseloads, as a percentage of population, are rural, and are also subsidized. The very large US federal farm subsidy programs are (and were intended to be) a transfer of money from urban to rural areas. Most states have telephone and electric tariff structures which include substantial urban to rural subsidies.

Of course, this is not a new situation. The problem of how to extend the increases in wealth that occur in cities, and the new technologies such wealth allows, to the rural areas, has existed pretty much as long as there have been cities.

This is going to be more and more of an issue, since people in outlying areas want all the amenities of population density, while living miles from their nearest neighbor - i.e. roads, water, electrical service, phone etc etc.

I'm not sure how viable it is going to be, long-term, to support extra-urban and rural infrastructure.

Meanwhile, educators keep asking for more money - which, in Chicago, ends up in raising real estate taxes, since Springfield refuses to fund things like public education and transit.

You forgot the Tax Increment Financing (TIF) districts, which effectively steer their R/E taxes elsewhere, thus adding to the woe. If Chicago would quit approving TIFs the schools might have a chance, along with public transportation.

Clicked on the link up top: Oil Rises as Five Days of Decline Makes Commodities Attractive to Purchase and got a different article altogether. What came up was:

Crude Oil Trades Near Three-Week Low on Concern of Slowing Chinese Demand. Bloomberg switched the article but kept the same URL.

Crude oil traded near its lowest level in three weeks on concern that a slower pace of economic recovery in China may constrain global fuel demand.

How quick things change. Crude oil, trading on electronic trades, at this moment is down 66 cents to $71.48. Interesting. The world is worried about China as well as a double dip recession. That probably means less demand for oil. At least that is what traders seem to think at the moment.

Ron P.

I noticed that too.

Traders are more concerned with the impact of the China economy moving from 10% to 8% GDP growth, than US oil use suddenly growing at a 6% rate over the last two months - after only slowly growing in the first quarter.

More specifically, bearish energy traders in thier comments have almost entirely ignored the 10% to 12% year over year growth in US diesel demand recently - as if it did not exist.

This article then is a good example of how 'news' is written (or in this case rewritten) to fit the mood of the market.

Interesting partial data point about short-term price signals and long-term effects (partial because the long-term bit is still in the future):


Because of how the US is privatizing its stock of the gas, prices are artificially low, which is encouraging a pattern of consumption that may leave us without significant supplies of the gas midway through the century.


The light weight of a helium atom, which makes it perfect for party balloons and blimps, is also the key to its scarcity. The Earth simply doesn't exert enough gravitational force to keep it on the planet. Once in the atmosphere, helium will migrate to the stratosphere and be lost to space. All the primordial helium in the Earth's vicinity when it formed is long since gone, and only flukes of geology have given us the opportunity to study it on Earth.

That's where things stood in the mid-1990s, when Congress decided that the US government needed to get out of the business of managing helium. Ostensibly, this would allow market forces to set a price proportionate to its remaining supply, something Richardson indicated he supported.

But Congress dictated that the supply had to be wound down within about 20 years, even though the Bush Dome had enough helium to supply the entire globe for most of a decade, even if all other sources were cut off.

The result has been low prices for the gas even though, at 2008 rates of consumption, we had only a 25-year supply.

Dutch agency admits mistake in UN climate report

"The underlying IPCC conclusions remain valid, said Maarten Hajer, the Dutch agency's director. The IPCC report is not a house of cards that collapses with one error, but is more like a puzzle with many pieces that need to fit together. "So the errors do not affect the whole construction," he said at a news conference."

"The original report said global warming will put 75 million to 250 million Africans at risk of severe water shortages in the next 10 years, but a recalculation showed that range should be 90 million to 220 million, the agency said."


Methane releases in arctic seas could wreak devastation

Massive releases of methane from arctic seafloors could create oxygen-poor dead zones, acidify the seas and disrupt ecosystems in broad parts of the northern oceans, new preliminary analyses suggest.

Such a cascade of geochemical and ecological ills could result if global warming triggers a widespread release of methane from deep below the Arctic seas, scientists propose in the June 28 Geophysical Research Letters.

...“This will be a truly big environmental pollution problem in the next few decades,” Elliott contends. “This problem is not going to go away.”

Besides generating large volumes of acidified water and low-oxygen dead zones, the microbial activity will rob the waters of key nutrients — including nitrate, copper and iron — that otherwise would be used by microorganisms that don’t feed on methane. Many of these nutrients are already sparse, and the resulting shift in populations among the fiercely competitive microorganisms at the base of the ocean’s food chain in many regions could be devastating, the researchers suggest

Here's the abstract for the article:

Geochemistry of clathrate-derived methane in Arctic ocean waters

Alterations to the composition of seawater are estimated for microbial oxidation of methane from large polar clathrate destabilizations, which may arise in the coming century. Gas fluxes are taken from porous flow models of warming Arctic sediment. Plume spread parameters are then used to bracket the volume of dilution. Consumption stoichiometries for the marine methanotrophs are based on growth efficiency and elemental/enzyme composition data. The nutritional demand implied by extra CH4 removal is compared with supply in various high latitude water masses. For emissions sized to fit the shelf break, reaction potential begins at one hundred micromolar and falls to order ten a thousand kilometers downstream. Oxygen loss and carbon dioxide production are sufficient respectively to hypoxify and acidify poorly ventilated basins. Nitrogen and the monooxygenase transition metals may be depleted in some locations as well. Deprivation is implied relative to existing ecosystems, along with dispersal of the excess dissolved gas. Physical uncertainties are inherent in the clathrate abundance, patch size, outflow buoyancy and mixing rate. Microbial ecology is even less defined but may involve nutrient recycling and anaerobic oxidizers.

Citation: Elliott , S., M. Reagan, G. Moridis, and P. C. Smith (2010), Geochemistry of clathrate‐derived methane in Arctic ocean waters, Geophys. Res. Lett., 37, L12607, doi:10.1029/2010GL043369.

E. S.

Thanks Black_Dog.

Articles like this and the recent Science article give one pause.

Looking at the artic sea ice disappear like butter on a hot griddle makes it seem like it will be a real horse race between PO and AGW.

I was out along the Yukon coast this past weekend with my Aunt and Uncle. They both remarked how when they used to go out to the camps along the coast 40-50 years ago they would be traveling in and around icebergs of varying size and shape. We didn't see any such thing - indeed the water was warm, the sun pretty damn warm. Nearest ice, from satellite images, looked to be hundreds of kilometers offshore.

Good link on sea ice, but note that it only covers sea ice extent. Total ice volume, long dropping in a linear fashion like ice extent seems to have lapsed into a non-linear collapse in the last few years.


A few things about sea bed methane--much of it is in the vast continental shelves, the largest in the world, much of it only a few meters deep. Yes, some methane will dissolve in even these shallow waters, but much will also escape into the atmosphere as a potentially powerful feedback.

Also, the frozen methane hydrate is serving as a cap over large stores of free methane. So just a small amount of clathrate melt can lead to very large and sudden releases of methane.

One thing not mentioned in the article or the abstract, unless I missed it, is--what exactly happens when the waters go anoxic (or close)? Presumably the fish sense the loss of dissolved oxygen and swim away. But do anaerobic bacteria then start producing massive quantities of SO2? (This is also a question for the Gulf.)

Plume spread parameters are then used to bracket the volume of dilution. Consumption stoichiometries for the marine methanotrophs are based on growth efficiency and elemental/enzyme composition data. The nutritional demand implied by extra CH4 removal...

Thanks for the technical analysis Black Dog but Is it any wonder why the general public thinks that Global Warming is a hoax? Got derivatives?


I really have no idea what you intend to say here. Do you really expect an abstract written in a scientific journal to read like the comics?

What exactly is difficult for you to understand here, anyway? Do you have trouble looking up words you don't know?

I'm with joe on this one. You could have politely restated what the statement means, but instead you chose to flog a straw man.

No one is asking for it to "read like the comics."

Maybe the jargon is appropriate for a science journal, but it doesn't do science any good to condescend to those who request translations into Plain English.

Ummmmm, that was what the originally cited article provided.

And they're asking for a translation to plain English. I don't think that's too much to ask.

Apparently, the folks who complained about the abstract didn't read the "dumbed down" news story to which I replied. I was just attempting to point to the original research report, not translate it for Joe Sixpack, in the event some interested folks might want to read the report in GRL. I could have just posted the citation, but then, most people can't go online to read the journal GRL...

E. Swanson

That is one reason I have a simple lexicon for most things I talk about, looking for the simple ways of explaining the complex. It is one reason why I also type the way I do, another is I Have been getting worse at spelling, my dyslexia has increased over 5 fold in the last 3 years. I have trouble seeing the words in my head when others tell me how to spell a word, I can't see it there any more, rather frustrating. And my typing is getting worse than it used to be. I can see the words in my head by when I hit the keys they are ixmed up a lot.

But I have had to deal with a lot of people who did not understand the ten dollar words that college journals have a habit of spouting off with, though that is good, it keeps the odd turn of phrase from being like TeXt speak, in a text to your friends.

Simple words for the complex concepts sometimes do not exist, how do you explain words we have had to create for the news features found in the brain, and the newest chemical compounds and mixtures, and formulas that math has been working on, and then there are all those car name we have to come up with every year( lol ). Language has it's ups and downs. Who has been taught Latin in the last 20 years? Anyone that is not Greek, know anything about it? Both of those languages have roots in a lot of the words we do use today, as well as create for new uses.

As a Landscape Architecture student, knowing Latin, told you a lot about why the plant was named that way, and was great if you had to know 500 species of plants and tell others what you meant. Now though there are new ways they are talking about classification, Tribes being the latest, It was odd to hear the word used in a speach I heard online, 20 years ago it was not used except to talk about a native people.

Acer Rubrum, I Read a Maple leaf and it told me I had to understand my audience.

(Red Maples everywhere just lost 10,000 leaves in a shudder)

JHK uses a lot of ten dollar words, which is great, but he can put the common folk off and they peg him as elite and above them poor folks. If you know that people might not understand what you are about to tell them, or even suspect that might be the case, you should hold your tongue( fingers) and pause a bit and then go on, watching for signs of them picking up stones with their body language, or closing down their minds to you.

Joe was asking a question I think, not just stating something. sarcasm and subtle tones are hard to get out via black and white spaces type, your voice is much better at that than normal. I try to read my words verbally in my head to see if I can change the Tune of the tone to get the point of the pin across faster.

Hugs all around some days it seems here on TOD we need to chill and buy a beer and shoot some pool before getting started on the discussions.

BioWebScape designs for a better fed and housed world, Where is my beer, darn, empty. Bartender, Beers all around on me.

Coal on Titan ?

With only one-fifth of this moon radar-scanned so far, scientists calculate that dozens of lunar lakes each hold more oil and gas than all of Earth’s proven oil and gas reserves – and that Titan’s equatorial sand dunes hold hundreds of times more coal than all of Earth’s proven coal reserves. Titan is a vast reservoir of hydrocarbons. Talk about Peak Oil.

I thought The Globe and Mail was a serious newspaper. Perhaps it has been taken from The Onion?
Coal on Titan, from the titanic jungles of yore.

What's the EROEI for collecting hydrocarbons -- of any sort -- on Titan for use on Earth?

Very high. Possibly even Titanic...

I thought The Globe and Mail was a serious newspaper.

Of course it is. Its sales are number one on Titan! ;-D

I don't know why, but stories like this always remind me of an old joke:

As the slave galley pulls into the Hawaiian harbor, the captain makes an announcement:

"I have some good news and some bad news".

"The good news is tomorrow you get the day off".

Yeah!!! cheers the slave oarsmen.

"The bad news is tomorrow we're going water skiing".

It should be mandatory these stories are preceded with the latest update on the Mr. Fusion development.

Abiotic coal of course. The terrestrial variety a prime energy candidate when abioitic oil flows prove inadequate. To be supplemented by aboitic wood.

Tea parties pay for inquiry barrister

TEA parties, garden parties and auctions have helped village campaigners raise £35,000 to pay for a barrister to fight their cause at a public inquiry.

Villagers were celebrating in February when Tewkesbury Borough Council turned down National Grid's application for a Gas Pressure Reduction Installation unit at Flat Farm, in Tirley. However, after the Grid appealed the decision, a public inquiry was set for July and villagers united to raise the cash to fund a barrister to represent them.

Now, following an auction of promises on Saturday, members of the Campaign Against Pressure Reduction Installation (CAPRI) are confident they have reached the target.

The Public Inquiry will start on Tuesday, 13th July at 10.00 a.m. at Corse & Staunton Village Hall.

Campaign Against the Pressure Reduction Installation

For those who don't know, that's the reason LNG can't be pumped into the UK gas grid at full design capacity.

I'm "amused" by the quote on the anti-installation campaign site "The Department of Energy puts it this way: 'the UK has a robust and highly resilient gas supply'." They use this quote to prove that the installation is not needed. Oh well, guess I must have hallucinated these Gas Balancing Alerts back a few months ago.

They just believed the government propaganda!

Not sure if this was previously reported; if so, my apologies.

Survey takes a look inside the homes of Americans
Most families with young children live within a mile of a public elementary school. The most common home heating fuel in the U.S. is gas. Only a third of American homes have a working carbon monoxide detector. These are just some of the findings of a new survey.

Most families with young children live within a mile of a public elementary school. The most common home heating fuel in the U.S. is gas. Only a third of American homes have a working carbon monoxide detector. These are just some of the findings of a comprehensive national sample of the more than 130 million residential housing units released Thursday by the U.S. Department of Housing and Urban Development.

HUD's 2009 American Housing Survey (AHS) is the most thorough look inside the homes of millions of Americans and reveals everything from the square footage of the unit to how many homes have front porches, garages or even usable fireplaces. First conducted in 1973, the survey's long-term design allows analysts to trace the characteristics of U.S. housing units and their occupants. For example, the 2009 survey reveals that significantly more American homes are larger and have more bedrooms and bathrooms than homes 37 years ago. In addition, homes of 1973 were significantly less likely to have central air conditioning and other amenities considered commonplace today.

See: http://www.echopress.com/event/article/id/76255/group/News/


We live a mile from the local grade school and another 1/4 mile and up a steep hill is a 8th and 9th grade school. Which was prefect for us when we moved here, I was going to 9th grade and my little brother was going to 3rd grade.

My mom and us would leave in the morning walking and when we got to 50th street my mom and brother would turn off and I would continue on to Ridge Road( literally the ridge of a hillside) junior highschool. Later when It was time for me to go to 10th grade I took the public transportation bus, but back then the buses did not run on time like they do these days, so after having to sit in the Asst. Deans office and have him call my parents several times over the course of a few weeks, my parents looked for other ways to get me to school. I hitched rides with a local girl who drove a car to school, Scary times, then with my dad on his way to Vo-tech school himself, then finally in 12th grade I was old enough to drive and having had to jump start my driving in the summer before, because my dad had to go in for surgery and I was the only one able to drive. My mom had been able to drive when my dad was in Vietnam, but refused to suffer that ever again, she just got to nervous driving.

So next thing the above sparks is that the house here, did not originally have an AC unit, it has an attic fan, great way to pull in air fast if you burn something cooking, or are painting or other harsh smells. And we have a Monoxide detector that works fine, have had one for ages.

130 million homes that have been priced out of this world and will blow into dust in 25 more years.

BioWebScape designs for a better fed and housed world,

Rain on Titan:

It turns out that Titan is awash in liquid hydrocarbons: in oil. Indeed, it rains liquid hydrocarbons – and, in the moon’s light gravity, each drop floats down from the clouds at roughly the speed that large snowflakes fall to Earth.

Does Ron know about this?


Of course Ron knows about this. Liquid methane covers most of Titan. Titan's atmosphere is 1.4% methane but below 8 kilometers from the surface it the percentage is 4.9%. The rest, (above 8 km),is nitorgen, 98.4% and hydrogen, .2%.

The temperature of titan's atmosphere is −179 °C, or −290 °F. At those temperatures, and with such a high percentage of methane in the atmosphere the methane will periodically condenses into liquid rain.

If earth had that much methane in its atmosphere and if we also had those temperatures in our atmosphere it would rain liquid methane on earth also. However the percentage of methane in the earth's atmosphere is 0.0001745%. Hardly enough to condense even if our temperature were -290 degrees F as on Titan.

What this proves is that the temperature must get low, really low, for methane to condense into rain even when it is almost 5 percent of the atmosphere. And methane at 0.0001745% is by far the most abundant hydrocarbon in our atmosphere. Meaning that there is no chance of it ever raining hydrocarbons on earth.

Write that down Riban so you won't forget it. And next time don't try to be such a smart ass.

Ron P.

It was intended as a respectful joke Ron, not a refutation.

But thanks for the Titanic education. I'll keep your advice in mind next time I feel inclined to levity, but I think I'd prefer to be a smart ass than just an ass.

In the future I'll stick to receiving the signal instead of contributing noise.

There is nothing wrong with levity Riban, as long as it is not at the expense of someone else. And your jab was clearly aimed at me.

I have been jabbed about this subject every since I said it could not rain oil. Some were even so silly as to imply that I said oil could not blow on the beach.

Any damn fool knows anything can be picked up by the wind, even fish. But hydrocarbons cannot be picked up by evaporation then condense back into rain. It is absolutely impossible. Well it is impossible at temperatures above -290 degrees F or at concentrations found anywhere in the solar system except on Titan.

Ron P.

It was all that jabbing that I was taking a lighthearted jab at. Maybe a bigger wink would have conveyed that better.

I learn a lot from your posts, and the forum generally. I'm grateful to everybody who contributes. I apologise if that felt like a malicious attack.

Apology accepted, and I apologize if I misinterpreted your post. My original post was, at least I thought, clearly to imply that hydrocarbons could not be taken up into the clouds and dumped as rain. The fact that I did not use the word "evaporation" led some to think that I was saying that the wind could not pick up oil and blow it onto the beach. Perhaps I should have been more clear but I reread my post several times and I thought what I was saying was very clear. It cannot possibly rain oil.

Wind blown oil, or salt water, is not rain, not by any stretch of the imagination. And it really pisses me off that some tried to twist my words into saying that I implied that the wind could not blow oil onto the beach. Geeze!

Ron P.

With the risk of being deemed troll-like I just have to try to get some explanations from the members of "the oil drum" on a newsflash that came today in Denmark.

(not full article)

I am sorry that it is in Danish, but the condensed information of interest is that they claim that US are getting near self-sufficiency with gas production for a long time.

The claim is that shale gas production has been matured in the US and scaled up very silently and now the Danish shipping company Maersk says that the LNG transport to US is being downscaled to next to nothing and rerouted to perhaps Asia - they seem to expect this to last decades.

Do the members have any comments on this? I am positively puzzled since i expected shale gas to become relevant in some years and at a huge price.

Shale Gas 'Revolution' Could Turn Out to Be Mammoth Spin Job

While I believe that it will take more than a few articles and interviews before we know the precise scope of this resource (which, incidentally, has been exploited to a limited extent for a great many years), I am going to insist that all of my energy economics students take a few minutes to read the short article by Bill Francis (2010), in which he emphasizes the observation of Henry Grope that despite all the talk about shale gas, it provides only a very small part of the U.S. gas output. Similarly, readers should be aware that the CEO of the oil major Chevron (CVX), John Watson, confesses that he will avoid investing in the shale gas sector. Mr Watson flatly declared that the price of shale assets is too high relative to expected returns to justify a large scale commitment by his firm. Put another way, he does not believe that shale gas has lived up to its publicity, and as a result he will not join many of his esteemed colleagues in investing millions or billions in that commodity – at least at the present time.

Bill Francis’ articles (Part One & Two):

Thank you. It seems to fit more with my vision of reality on shale gas.

So we have here the CEO of DONG making direct lies? And doing that together with Steffen Nielsen energy attache at OECD...

But this should be fairly easy to dispute by looking at the next quarter(s) of gas imports/exports or am i wrong?

For them to make such a shortsighted lie I would think something important in upcoming in the short term?

Is it politically decided or do we have private investment agendas making these newsflashes?

Uh Uh Paranoia is rampant... :-D

I find it hard to believe the negative comments on shale gas. Fisrt, CVX seems to stand alone in its's view of shale gas because just about every other major including XOM, TOT, BP, Shell, STO etc. have made major commitments to the shale gas potential. Secondly, I have yet to see any proof that the eur per well forecast by the msjor E%Ps in the shale plays are inaccurate. In the haynesville core, CHK projects eur of about 6.5 bcf per well and they plan to drill about 4000 wells, or so, if my memory serves me right. HK projects eur of 7.5 bcf for their acres which appear to be very high quality.

They now have three years experiece with many wells, and with the high decline rate (80%) in the first two/three years, these wells (over two years old) must have already produced 5 bcf. If they have, then the shale gas potential is for real. If they haven't, then they should be charged with fraud, and it would be easy enough to retrive that data from the E%Ps themselves. Four thousand wells with an eur of 6.5 bcf is 26 tcf. No wonder the major's want a piece of the action. Perhaps CVX is suffering from a case of sour grapes for having missed the party.

How to go green in facilities management
How successfully will companies respond to the CRC requirements coming into effect this year?

One area of enterprise energy consumption, often overlooked, but which can account for up to 30 percent of operating costs, and is always low hanging fruit for energy saving, is lighting. “Electricity used by lighting is one of the easiest places to target energy savings with a fast payback,” says Duncan Stevens, director of Vita Energia, which specialises in minimising energy usage in existing lighting systems and recently expanded into Poland. In premises such as airports or factories managing lighting can cut maintenance and energy costs by as much as 75 percent.


The NEC Group’s first Carbon Survey identified potential savings of £600,000 through simple measures: from improving lighting management procedures, to switching off vending machines at night. “By acting on this advice, we have already seen a reduction in our energy bill of £313,000 and have cut our carbon footprint by 1,600 tonnes of CO2,” says Thandi.

See: http://www.businessrevieweurope.eu/business-features/operations/how-go-g...



Moral of the story: retrofitting is good and makes business sense in Europe. Makes sense in Halifax, too.

Betcha already knew that!



P.S.: Spent the day in the garden. Never seen the soil as dry as this year. It's parched down to a depth of two feet. Heat wave over Ontario and Quebec this week. Here's hoping it stays west of us. Extreme risk of forest fires already.

P.S. II: Good news, Paul. Saw several hummingbirds in the past two days. Whatever caused their mysterious disappearance, they seem to be back.

Excellent news about the hummingbirds, Tom. Environment Canada is calling for a 40 per cent chance of drizzle overnight and tomorrow morning and a similar chance of showers on Saturday, with temperatures several degrees above normal for much of the week ahead, so no relief for us quite yet, I'm sorry to say.

The volume of audit requests continues to grow day by day. No doubt NSP's application for an 18 per cent hike in commercial rates next year and a warning of several more increases to follow will kick things up another notch or two as word continues to filter out. I just hope our supply of materials holds up (we're already encountering spot shortages and the phaseout of T12 lamps come 2012 is only going to make the situation that much worse).



Best of luck keeping up with the retrofits. Spot shortages, that's interesting. The work on the street is that China is back ordered eight weeks to six months and some factories aren't taking any more orders. That would seem to be the world economy cranking up again.

I asked about U.S. made parts and my informant just laughed. The answer is well, some screws are made in Canada.

Puts all the fancy environmental and lighting controls that have become so popular lately in an interesting light. We may have been entirely too clever in some of these buildings.

Thanks, Celt. We've been told not to expect any FO59T8 ballasts for the next several months and that Osram Sylvania, Philips, GE and others are in the same boat as they all depend upon the same Chinese suppliers.

I've waited over three months for a shipment of 347-volt 0.77 BF 4-lamp tandem industrials. Our supplier brings in a couple thousand troffers at a time as we can chew through those things in the span of a few days.


Hey Paul,

Glad to hear you're keeping busy. Yes, let's hope demand won't outstrip supply. Keep up the good work.

It appears this morning that the 40% chance of drizzle applies to Halifax. In the Valley, it's overcast and no precipitation. This summer is exceptionally dry. We live in a part of the world where summers are prone to be be soggy or if we're lucky clear (called a Bermuda High) with periods of sogginess. This dearth of rain, drizzle and fog is hard on the local wells and irrigation systems.

What's worse, if the waters warm up offshore the same way as 2003, we'll be vulnerable to another category 2+ hurricane. Nova Scotia is similar to Florida: as a peninsula that juts out into the Atlantic Ocean, we on collision course with whatever nasty weather is making the rounds. In years past, we were spared the full fury of hurricane season by the mitigating influence of the cold waters of the Labrador current. That's been less of a factor lately - much to our peril.

We don't need another Juan.

If anyone doubts climate change, they can talk to any adult who grew up in the Maritimes. The weather patterns are markedly different from even a decade ago.

Thanks Paul for the work you do. You're doing your part everyday to reduce the carbon footprint in s very practical way. I, for one, appreciate it.



Thanks, Tom, for your kind words. Light showers are moving through as I type, so hopefully they'll continue to make their way to you soon. We can definitely use the rain as you point out. Our weather is out of step with what one would normally expect here on the east coast -- you would be hard pressed to believe otherwise. I have to change the oil on our generator and refresh our supply of gasoline in anticipation of hurricane season, which sounds rather bizarre given we're so far north, but I expect we'll be on the receiving end of something nasty in the months ahead.



Here in Arkansas, central area, it is 6 inches below normal rainfall, where last year we hit the all time high of 83 inches, in another town close by( within 50 miles) they got 100 inches Twice normal.

Odd Odd weather for so short a time frame.

There was talk recently locally of this being reminding people of 1980 when the high hot weather put a lot of things in the oven. over 20 days straight of over 100, and no rain for over a month, not even afternoon heating showers.

Here is hoping the storm Low from the gulf heads this way and dumps more rain.

BioWebScape designs for a better fed and housed world, hugs all.

Odd Odd weather for so short a time frame.

Charles, yes, similar variations all over. Odd odd is becoming normal whereas familiar weather patterns are becoming odder. Farmers feel the effect first, since planting crops or raising livestock relies on planning around what can be reasonably expected on any given year. Inconsistency is hazardous.

Here's to a Elijah-like invocation of rain.



Relief well is last best hope to contain gusher

"Chief Executive Tony Hayward said in June that the reservoir of oil is believed to hold about 2.1 billion gallons of oil. If the problem was never fixed, it could mean another two years of oil spilling based on the current flow rate until the reservoir is drained."


I would like to point towards this PDF by Kjell Aleklett and Kristofer Jakobsson:


On page 2 there is a graph I unfortunately can't copy into here because I don't have a web site to store it on and link to. But have a look at it. The graph show how GDP and oil consumption grows per capita in China, India and Sub Saharan Africa respectively. The correlation between oil consumption and GDP is very cear here. But notice that China grows its GDP faster than its oil use. They are in effect getting more efficient, it is the growth of the economy that pushes its growth in oil consumption.

Should all the chinese reach a life standard of say Rumania we are toasted.

This article deals with oil, but I guess it is the same for coal.

"But notice that China grows its GDP faster than its oil use. "
Chinese GDP has its own particular mix of components. Coal using growing fast, I hear.

"But notice that China grows its GDP faster than its oil use."

Generally speaking, the world grows its GDP faster than its energy use. This graph is one I put together a few years ago. Lots of people have put together similar ones, with similar coefficients. You can pretty much substitute oil for energy without any significant change. For economies around the world, the ratio is roughly a 1% increase in per-capita energy use is accompanied by a 1.3% increase in per-capita GDP.

The causal arrow appears to run in both directions. Increased energy use leads to greater productivity and income. Increased income leads to increased energy use for "non-productive" activities such as leisure. Lots of econometricians have spent lots of effort attempting to prove that the arrow runs one way or the other, without a lot of success.

The question is what happens on the way down. We use oil to do work that might previously be done by hand, thus improving human efficiency. If oil production starts heading downward, how does the GDP decline compare to the oil production decline? My view is that you get the multiplier effect going down as well, because of the impact of debt.

Think first what happens as oil use grows. In a rising economy, it is easy to repay loans, so the amount credit available to consumers and businesses tends to grow. Increasing debt contributes indirectly to economic growth (and may explain some of the 1% to 1.3% ratio above.) For example, with more debt, consumers purchase more automobiles, and the production of these automobiles is measured in GDP (even if the debt itself isn't measured there).

As oil use declines, we can expect huge defaults on debt (because it is growth that allows debt to be paid back with interest, relatively easily), so debt is likely to contract. This will cause fewer automobiles to be made and fewer houses to be built, exerting downward pressure on GDP.

As oil use declines, we can expect huge defaults on debt (because it is growth that allows debt to be paid back with interest, relatively easily), so debt is likely to contract.

It may be difficult to tell the oil-related defaults from all the rest. Stuart Staniford has put up some interesting graphs based on Federal Reserve data. Within the US, the financial sector has more debt than any of (a) total household debt, (b) other business debt, (c) current federal government debt, or (d) state and local government debt. The financial sector cannot possibly generate the profits needed to pay off that debt, peak oil or not. There's a staggering amount of worthless paper out there.

Since I have started reading TOD I was hit by the Peak Oil/Global Warming wave. But first I was hit by PO. So, I try to think, imagine, mentally prepare myself to try and adapt, if I can, when things are complicated by rising oil prices. My goal, live to be 50, at least, and help those around me if can. I even started growing vegetables in pots on my apartment's balcony: a few lettuce sprouts, 3 tomato plants and I was able to sprout a chickpea plant. This is most likely not enough in the end, but it's a constructive hobby at least.

But then the Global Warming idea comes to mind, I can't seem to get my head around it, it's just staggering. I begin to think that GW is many magnitudes worse than PO. PO mitigation/survival requires human will power and action, even though it's too late to do anything at a large scale, but with the right mentality good things can happen here and there. But GW...hold the presses, if you hit tipping point, it’s like trying to stop an avalanche with your hands, right?

Enlighten me, please, confirming or denying these ideas I have...GW will...

Make agriculture enormously difficult if not impossible?
Dry up rivers and other bodies/sources of water around the globe?
Cause millions of deaths from the ever increasing heat alone?
Destroy important ecosystems and food chains?
Interfere with or impede significantly many human initiatives to adapt to PO?
Will be the real test of the human being’s ability to survive?

Am I right? Wrong? Have I missed anything?

Some see PO as almost insignificant compared to GW. However, PO is severely limiting our options in dealing with GW. Similarly, Financial Collapse: PO.


A pretty good little summary, actually. But we can do quite a bit about emissions in very simple ways. Still some hope.


They are all inextricably linked. The dumbest approach is to favor one over the other. Systemic thinking to get sustainable results.


PO is causing financial collapse by causing reduced economic growth, which makes it more difficult to pay back debt with interest--hence the rise in defaults in the last few years (following the plateauing of world oil production in 2005). Debt defaults can be expected to increase in the next few years, as oil use declines, triggering financial collapse. Hard to say that is insignificant.

Economic collapse will tend to affect GW, since CO2 emissions are likely to drop fairly quickly, whether or not any attempt is made to reduce emissions. For example, the recession caused US emissions to decline in 2009. Economic collapse can be expected to have even greater impact.

I truly consider this an irresponsible response, with all due respect. Like so many that believe PO takes precedence, you fail to allow for the following:

1. Tipping points. There were three different reports out in the last 48 hours or so that all point to tipping points being passed. Once that happens, climate can change globally and dramatically in just a few years. There are examples in the geological record of multi-degree changes in periods of 10 years, two years, and even more regional changes of several degrees withing a few months!

2. Even if the tipping points are far off, and they aren't, the conditions that create them are *now.* You can't separate the one from the other. Thinking ACC is a future event shows a very poor understanding of ACC and/or ACC risk assessment.

On the other side of the equation, you are stating as fact that which is opinion. Few people, economists or otherwise, would attribute the financial collapse to PO. Part of the equation? Of course. But cause and effect as you state above? Not at all. Perhaps you were not being careful?

Finally, the assumption that the only metric at play with climate is human emissions. CH4 is currently at @ 1.7 ppm (or is it ppb?), but previous to the present era had not been more than 0.7 or 0.8 for millions of years. Even if emissions fall, they will not go negative. Couple that with natural feedbacks already occurring to enhance human emissions, the assumption that economic downturns will solve the problem is patently false. This is supported by a report just released that CO2 in the Pliocene was only around 400 ppm, yet the poles were forested, even tropical. We're at@390 and rising.

Also, clathrates are degassing ahead of schedule. The Arctic is melting ahead of schedule. The Antarctic, ditto. Glaciers, ditto. Greenland, ditto.

Another new report? The oceans are at the brink of irreparable change.

If all emissions ceased instantly, the momentum in the system would likely still take us past thresholds into some very bleak scenarios.

Climate Change is now. The failure to understand and respond to that is likely to be a suicidal one.


ccpo, get a grip.

Don't you know that the electrons zipping across screens at various stock markets around the world is the real reality, while things like viability of oceans and the future of complex life on earth is just fluff we needn't worry our pretty little heads about.


I just read something that said most people that don't understand GW think that the CO2 we emit only stays in the atmosphere a year or two. So they think if there's a little economic downturn, GW will quickly solve itself. How they get this idea is beyond me. Increases in CO2 concentration now will persist for centuries and probably for tens of millennia.

Also, the global CO2 emissions did not stop with the economic downturn of the last few years. We're still adding about 2.5 ppm a year--up from under 2ppm/yr in the 90s.

As oil becomes more expensive, more coal will be burned in much of the world where oil is still used for electricity generation. This will not lessen our GHG emissions.

It is far more likely that, as things get more and more desperate on the plateau and down slope of H's curve, we will see more and more attempts to make the most of the still relatively abundant but much dirtier coal for more and more purposes.

But for many, financial disruptions may well be/have already been the first impact.

From where I sit, though, things look to get pretty crazy pretty quickly on the climate/environment front, as the ice melts and the methane bubbles and the oceans die.

Modern society depends on cheap ff, especially oil.
It also depends on access to credit.
All societies and species depend on access to reliable sources of food, at least every few days.
They also rely on access to potable water every day or so.
They also (except anaerobic microbes) rely on access to oxygen at least every minute or so.
They also rely on a temperature/humidity range that is survivable.

All of these will be more and more difficult to get for more and more, but I would say the first two priorities pale in comparison to the rest.

But maybe that's just me.

why exadurate everything: CO2 increases of the past 20 years and 10 year avg of the previous 10 years.

1990 * * 1.31 * * 1.54
1991 * * 1.02 * * 1.50
1992 * * 0.43 * * 1.47
1993 * * 1.35 * * 1.39
1994 * * 1.90 * * 1.45
1995 * * 1.98 * * 1.52
1996 * * 1.19 * * 1.49
1997 * * 1.96 * * 1.45
1998 * * 2.93 * * 1.53
1999 * * 0.94 * * 1.50
2000 * * 1.74 * * 1.54
2001 * * 1.59 * * 1.60
2002 * * 2.56 * * 1.81
2003 * * 2.29 * * 1.91
2004 * * 1.56 * * 1.87
2005 * * 2.55 * * 1.93
2006 * * 1.69 * * 1.98
2007 * * 2.17 * * 2.00
2008 * * 1.66 * * 1.88
2009 * * 1.76 * * 1.96

Thanks for the data. Could you link the source?

Even so--so I was off by ~.5 ppm (on the ten year averages--about 2ppm in '00s, about 1.5 in the 90's). So sue me.

Note that there was no noticeable dip during the economic down turn, at least nothing much greater than the annual variations seen in some other years.

Ominously, if you look at the record for, I believe, May, which is the peak each year, the jump from '09 to '10 is almost 3 ppm.

Things are accelerating.

A lot.

Hate to say I told ya so, but...


PO is causing financial collapse by causing reduced economic growth,

You always say that but as a lot of other people have pointed out I don't think you have proved it. In developed countries, debt has been growing faster than income for several decades. As debt grows faster than income, more and more of the income goes into servicing the debt. This is obviously unsustainable, even if the world was awash in oil.

I think financial collapse was caused by the following:
1. Excessive growth in debt over the last 3 decades
2. Financial deregulation that turned banks and financial institutions into casinos.
3. Repeal of Glass-Steagal act in 1999
4. No regulation of over the counter derivatives (thanks to Greenspan)
5. Globalization which puts downward pressure on wages and reduces employment via off-shoring and wage arbitrage.

Of course, expensive oil makes a bad situation worse by reducing the disposable income but I don't think it is the root cause.


"As debt grows faster than income, more and more of the income goes into servicing the debt. This is obviously unsustainable, even if the world was awash in oil."

I think the point is that at some level people and institutions are willing to extend these kinds of debts because for the last 100 years or so of ever-expanding access to cheap oil, it has been on the whole a winning proposition.

When it becomes clearer and clearer to people and institutions that this is now longer the case, debt will stop being available to almost all enterprises.

Anyway, that's one way to look at it. So your #1 was by this theory a direct result of increased accesss to cheap energy and,even more importantly, expectation of continued, ever expanding access. #s 2-5 were all then fostered by #1, and even more by an underlying philosophy of endless growth that had been fostered by nearly 200 years of ever expanding access to cheap energy, mostly ff.

That's not to say there wasn't a whole lot of malfeasance and plenty of bad actors along the way. But the whole unsupportable mess was fostered by the idea that we would always have more cheap energy (and that there would not be any very serious negative consequence to unsequestering and burning up all that safely sequestered carbon).

This is an idea that will be/is coming into question more and more.

Explain to me why there are no widespread defaults in countries like Canada and India where the financial sector is tightly regulated. Not a single bank has failed in Canada and India! Maybe it has something to do with the fact that you have to make a large down payment and have to be credit worthy to buy a house or a car in India? Or maybe it has something to do with the fact that Indian and Canadian banks don't package and resell mortgages but keep them on their books? Or could it be because "home equity loans" and "cash out refinancing" are non-existent in India? Incidentally, both Indian and Canadian consumers pay more for oil than American consumers. Canada may be an oil exporter, but they don't subsidize oil for domestic consumers.

Also, explain to me why the Japanese credit bubble burst in 1990 and why Japan was dealing with widespread defaults and bankruptcies even when oil was ridiculously cheap. Why couldn't Japan continue to inflate its credit bubble until 2005 when conventional oil production peaked?

Credit contracts and you have widespread defaults and bankruptcies when the cost of servicing debt becomes too large. Peak oil makes a bad situation worse by reducing the disposable income of consumers. But peak oil is not the root cause of financial collapse. Even if another Ghawar was found tomorrow and price of oil collapses to $20/barrel, the Fed won't be able to reinflate the credit bubble until much of the debt is paid down or defaulted on.


Good points about regulation. Note that I said (I think) that expectations of ever cheaper oil *fostered* a culture of ever greater debt and corruption--it didn't dictate it.

The corruption is greatest in the greatest centers of power--US and much of Europe.

So all I'm saying is that an expectation of ever-cheaper energy was a fascilitator, enabler and encourager (but not a deterministic necessary dictator) of ever increasing debt.

I intuitively sense (I could be wrong of course) that the relationship between PO and GW is a little like rolling blackouts, or extinction events coming in waves that are separated by time, a lot of time relative to a human life.

There is no question that the oceans are dying---acidification, the temperature disruptions that interfere with the food chain, overfishing, etc. Those are mainly GW events but the real cresting of this problem will be decades away probably. Maybe 50 years or more before a lot of the oceans are really massive dead zones. PO will bite much sooner than that, and be much sharper and more acute, limiting everyone's options and mobility. My idea is that PO is sort of semi survivable if you live in a good climate and have the right amount of neighbors (not too many not too few), are in good health, etc. But once PO crests and tapers off (ie people abandon cities, try to live with solar flows) then GW will seriously bite and put much more serious and stricter limits on what can be done, and perhaps prevent cultures from recovering from PO induced trauma. Georgescu-Roegen sees the end as featuring small bands of humans sort of semi nomadic. It's possible to imagine them a century or two from now, sparsely populating areas that still have some water....and every year maybe fewer of them.

Those are mainly GW events but the real cresting of this problem will be decades away probably. Maybe 50 years or more before a lot of the oceans are really massive dead zones. PO will bite much sooner than that, and be much sharper and more acute, limiting everyone's options and mobility.

Why do people keep repeating this completely illogical conclusion? I want just one of you who say this to actually back it up.

Dangerous, dangerous thinking.

Why do people keep repeating this completely illogical conclusion?

Because they base their conclusions on belief rather than data, and in this case the belief helps them to think it won't have any effect on their lives based on the eroneous assertion that it's too far into the future.

It's becoming more apparent all the time that peak oil and AGW are simultaneously moving us towards a bottleneck. Both will have negative impacts that push humanity in the direction of economic collapse. For example northern India relies on Himalayan melt water runoff from glaciers that are shrinking. As the rivers drop in volume due to less runoff, the associated costs will further degrade their economy, much like higher priced oil due to depletion will do the same thing. Anything and everything to do with oil depletion from peak and or the effects of adding massive amounts of CO2 to the atmosphere are intertwined and interconnected in the direction of reducing economic viability.

Sometimes I think the denialists are egging on disaster. It's almost like a kid double dog daring another kid to hit em in the shoulder because the first time didn't hurt. Then when he does he gets real mad, and I suppose the denialists will probably be the angriest when they are finally proven absolutely, completely wrong, and their little bit of BAU is gravely threatened. They'll say something really stupid like, "Looks like Al Gore's wish came true", instead of taking responsibility and saying something like, "We should have listened to Al Gore's warnings and done more about it while we still had time."

Thank you.

PO will bite much sooner

Yeah right.

NYT story: Protests Over Fuel Costs Idle Much of India

"but the real cresting of this problem will be decades away probably"

We should be so lucky.

Until relatively recently, this was the accepted wisdom.

But things are now going much, much faster than what was thought remotely possible only a couple of years ago.

Do you have any idea what the difference is between a planet that has a large mass of ice over much of the top of it all year, and one that doesn't?

I don't. I'm not sure anyone does, for sure. But it is likely not to be a trivial difference. And that non-trivial difference is not likely to be kind to the enormously complex systems we depend on for our survival.

I live in a huge metro area---Tokyo. I can feel that nature is basically dead all around me. Yet I think it isn`t in other places. I think there might be a few more decades before everything dies. At least I hope there are. I really do do what I can. No car for our family, just bikes. I always bring my lunch to work. Hang all laundry to dry. I haven`t flown in 5 years. I grow some veggies and fruits for our family. I would advocate banning the sale of all new cars tomorrow. And if there were a govt that said "no plastic as of next week" I would support it.

In short I don`t want GW to happen and I don`t say that I don`t think things could get much much worse faster. But let`s say they do---then we will all die, it`s as simple as that, way before PO clears the value of all of our bank accounts and shuts down all the gas stations.. I don`t think I can go around thinking "the end is just weeks away, better get my shroud in order" and still function. So maybe I am living in fantasy land, thinking that some places will escape for a few decades, some remote, natural places with lots of mountains and trees....but if we are all truly doomed (and I see no sign of people junking their cars in any country by the way and trying to counter the effects of GW) then maybe it`s better to live with a happy illusion. Not that decades of slow grinding and relentless catabolic collapse, followed by centuries of species extinction caused by GW, can be called a "happy illusion" by any stretch....but relative to let`s say one or two years down the line all the oceans turn into dead zones of toxic waste and the "wet bulb" temperature situation becomes such that noone can stay alive even wet and naked in the shade....well, if we are really headed for that condition (and soon), and noone will listen or care (except a few people here on TOD)....then simply getting up in the morning and managing to smile and say "good morning" becomes a great accomplishment.

I`m not a scientist. Things could be a lot worse than anyone knows. But noone will do anything, like stop driving, or give up plastic. If 7 billion people are bent on destroying themselves and the planet then how can anyone with a more environmental idea stop them? So I choose to live in my fool`s paradise, because I have done everything I can already and I know that most people around me are only focused on soccer, new clothes, the stock market, etc. despite my cautionary words and lectures to them. I hope you are wrong, but I fully accept the fact that you might be correct, that I don`t know, and that I wouldn`t buy a car in either case because I prefer my bicycle.

"simply getting up in the morning and managing to smile and say "good morning" becomes a great accomplishment"

It does indeed. I think of myself as a mostly upbeat person, but I am regarding that part of my personality less and less as a rational response to our set of predicaments.

Pi, I know it feels hopeless at times. Most of those times it feels hopeless for me, I have been reading TOD to much, or I have seen the news to many times, Or I have had to deal with some people more than I normally do.

But That being said, I am not a hopeless person in general. Most days when I am feeling hopeless I need to go recharge myself in positive things, (Reading the bible and praying for me is one of them) Going outside and looking around at all the plants that grow in my yard, even the ones I don't want there, and the ones I am trying to save from my dad's axe, and the ones I can't figure out how they got there, and the ones I like the looks of, and want to add them into the design of something artistically, or as some sort of pretty mental picture, or the ones I am collecting seeds off of and keeping track of so that I can grow mosre of them.

The natural world for me, even if it is looking at a harsh place, I don't see hopelessness in nature, I see it in how people misunderstand and misuse the gifts of the world around them.

As to plastic, I use it on a second hand basis, I have plastic milk crates I saved from a dumpster last year in my water collection system, I have 6-55 gallon barrels and 2-30 gallon barrels and plastic totes and plastic buckets and loads of other plastic things all over the place, second use of them, they aren't in the ocean collecting seaweed and being homes for fish, or being their death. I try not to buy things that have a lot of plastic on them, in them or are made of it. I have to buy PVC fittings for the rain collection system as It stands in my yard. If I see a bit of plastic trash I can use I get it, likewise of any other junk of others.

Most Plastic parts are a waste product of the Oil product stream( at least were at one time thought of that way). So vast amounts of Plastic is going to be with us for a long time to come even if we stopped all Oil Production today.

I have worked in the pieces parts recycling business in the past, back then the bulk to of the recycled plastic bits were being shipped to China. Then I expect it got sent back to us as plastic veggie slicers like JHK is oft using in his papers and talks.

I know that Bamboo would be a better material to use, but at the moument I have no way to get it, but to have it shipped here from elsewhere, what is the point of that? I could design a system of water catchment better than I have now that was more sustainable, but it looks great on paper, but right now the systems to get to parts are not energy and time and money wise. It all stems back to what can I get within the world I live.

Recycling industrial mankinds trash is better for me today, in 50 years, making rock basins and ponds and cisterns and channels and runoff courses is likely to be the name of the game. I have the skills to do that, just not the rocks.

We each live within a whole framework that is not where we want to be really, we most would prefer to be in a better place, but while we are here in the places that we are, we have to learn to adapt to the locale and feel happy about it, no sense dreading death tomorrow, expect that you will not live to see the end of the day, and go one about life as if you have a 1,000 years left to plan and live.

Zen Master Charles, Class of 1963, taught by the cat in his backyard.

BioWebScape designs for a better fed and housed world, even if I never see the sunrise today( it is overcast, thank God). Hugs from Arkansas.

Your bullet points are spot on but the devil is in the details. What can you do? Not much really but your survival is most important.

You might start here:


Once your finances are OK, be flexible to what might come your way. Hope for the best but plan for the worst. A supply of food, water, and other stuff to handle short to medium outages. Long term outages will develope but you must get through the short term shortages first.

The problem goes on and on. While there is energy to develope your plan and get it started, by all means 'just do it'.

If you are old enough to remember 'Watts'; place yourself in that virtual environment and think what you would do. Remember, no one there was hungry.

Scary? You bet and a lot of your friends won't make it (sorry bout that). BTW: I am way past your goal age and have been a certifiable 'doomer' for a long long time.

From the Automaticearth article:

#1 Hold no debt (for most people this means renting)

Full stop - terrible advice. If you plan on staying in the area where you currently reside, permi-renting is not wise long term policy. With the debt levels of the US government growing at an astronomical pace, high levels of future inflation are looking more and more certain. Fixed rate morgages are at historical lows, and a locked-in low mortgage rate will be worth more than some brick of gold in your basement(scratch that... in the basement of some house that someone else owns).

Look at it this way, take what you are currently paying monthly for rent and multiple it by 12. That is the amount your current rental unit would have to lose in value over 1 year for it to be technically more beneficial to rent than buy your current abode. Now, subtract your yearly rent a 2nd time, same story for the two year period. Now do it a total of 5 times... 5 years of rent is a lot of money. At the end of 5 years you have nothing to show at the end for your money, can be evicted at anytime (thanks for putting in that food garden by the way, the owners will enjoy the produce and fruit in the coming hard times), can have your rent raised at any time, and can look forward to continuing to pay rent until the end of your life. The homeowner with the fixed-rate mortgage on the other hand, has inflation protection, housing security (hands off my fruit tree), and is building more and more equity with every payment.

Take it to the extreme. After 30 years, even if the house has lost 50% of its value due to some kind of crazy deflationary cycle, the house will still be completely owned by you, you never have to make another house payment (and you benefit from lower real estate taxes, which you were also able to dedcut from your income taxes). During those 30 years, your house payment never went up, ever, as you had a fixed rate. Meanwhile, the renter has put out 30 years worth of rent, risking rent increases or evicition at any time, and yet still has no home equity and will have to pay rent for the rest of their natural life. Not such a great deal for that renter in the long term, eh?


I am a proud homeowner and glad I took the plunge. Even gladder that I am a few payments away from owning free and clear.

But ownership has its costs. We have a large dying tree that will have to come down (probably thousands of dollars). We will have to paint or have someone paint the house soon...again (at least a thousand dollars). We have had ongoing plumbing problems (thousands of dollars)...

And it really just never ends.

If you can, get (or switch to) a 15 year mortgage. Get the cheapest house that's acceptable to you so you can do that. We saved at least $100,000 by refinancing to a 15 year mortgage when rates went down low enough that it was the same monthly cost to us as the 30 had been.

I don't much like giving money to landlords, but I certainly have hated giving it to banksters.

Paying down your mortgage faster is certainly great advice. You don't even need to refinance to a 15 year loan. All you really need to do is send in a bit of extra cash with each monthly payment... assuming you can afford to do so. You can turn a 30 year into a 22.5 year for example, with a little bit of extra money each month. For each $100,000 of loan, assuming 5% interest, you'd need to add an extra $80 a month to your payment to own your house 7.5 years sooner, or in 3/4 of the time as a 30 year loan.

Here is link to a mortgage calculator that you can play with to see how extra payments can shorten your individual loan.


Even if you can't shorten your loan at the moment, in the long run you will still be better off owning than renting.

The basic flaw in your logic is the assumption that you will be able to pay the mortgage for the entire 30 year life of the debt. Lots of folks are now finding that their ideas of lifetime employment didn't work out, so they are now faced with losing their homes to the banks. It sure didn't work out that way for me, although I do have a paid up house, which I built myself.

If the economy gets into a massive inflationary spiral, who is to say that your pay will grow at the same rate? If the cost of everything you must buy increases exponentially and your pay is fixed, paying on a mortgage may become impossible as buying food and fuel may take precedent. Then, you're out on the street with everybody else and the cost of renting will have increased along with everything else. Then, you are screwed, living in a tent under a bridge, that is, if you can find a space to pitch the tent, given the large number of other residents already staying in Hoverville...

E. Swanson

Then, you're out on the street with everybody else and the cost of renting will have increased along with everything else.

I think you just proved my point. The worst case scenario you painted puts you in the exact same boat as the people who are currently renting. I fail to see how the possibility of not being able to make the payments for the home you own is worse than not being able to make the rent payment for the month... both strike me as equally unhappy circumstances. The worst case scenario is equally bad for both cases... the best case scenario is orders of magnitude better for home ownership as versus permi-renting.

If the cost of everything you must buy increases exponentially and your pay is fixed, paying on a mortgage may become impossible as buying food and fuel may take precedent.

So, who is better off, the person will exponentially increasing food, fuel and rent costs, or the person with exponentailly increasing food and fuel costs, and a now trivial mortgage cost? Not having to worry about rent increases from the landlord puts the homeowner/buyer in much better shape than the renter.

I fail to see how the possibility of not being able to make the payments for the home you own is worse than not being able to make the rent payment for the month.

Easy. If home prices go down, you end up out on the street owning the bank maybe hundreds of thousands of dollars (has happened already in some places where the bubble was bubbliest). If you were a responsible borrower who put down a large down payment, you're out that, too.

If real estate prices don't go down and you can keep making payments, owning builds wealth. If they go down or you can't make payments, it destroys wealth.

I still think there's a good chance that we're going to get a deflationary spiral, not an inflationary one. In a deflationary environment, you don't want to be in debt. Even "good debt," like a mortgage.

And in a bad economy, there's a good chance you'll find you want to move. What if you can't sell the house? This has become a serious problem already. People want to move to where the jobs are, but they can't, because they're tied to their houses and upside down on them.

Big news considering the millions of Tim Hortons cups that are discarded in this country each day.

Tim Hortons cups turned into biofuel

Discarded Tim Hortons coffee cups are being turned into ethanol by researchers at the University of Manitoba.

Microbiologists Richard Sparling and David Levin said they came up with the idea of using the paper cups after walking past some of the four Tim Hortons outlets on campus.


Since starting the project "on a whim" in 2009, they've had some promising results: they have found they are able to generate about 1.3 litres of ethanol from about 100 Tim Hortons cups.

See: http://www.cbc.ca/technology/story/2010/07/05/tim-hortons-waste-cups-fue...

Interesting to note that the bacteria used in this process prefer Tim Hortons cups over Starbucks. None of that high falutin stuff for us, thank you very much.


Given that 1 paper cup weighs about 10 grams, and 100 papercups is about 1kg, and 1,3 liters of ethanol weighs about 1kg, that is impressive

Hi Valment,

I'm guessing some of the extra kick is related to the residual cream and sugar. Make mine a double-double, I can hear them say.


Makes you wonder if this was a news release from The Onion (haven't read it), or a prank along the lines of Vivoleum. The answer to biofuels is to have more people go through the Timmy's drive through and drink more coffee in biodegradable cups? Brilliant!

It's like a past colleague told me about a whimsy study they did at university in economics looking at the impact of Canadian Tire money on the national economy and money supply. Yes, I have actually used Canadian Tire money as currency exchange.

BC_EE, whatever do you mean? Do you mean to tell me Canadian Tire money is not legal tender and exchangeable with other world currencies?

Hot damn! Sandy McTire is as recognizable as the Queen. Now that's a face that the world should know.