DrumBeat: May 22, 2006

Now for some wise words from the readers of The Oil Drum...
Article from UK times stating that the markets are currently in the same "state" that preceded the 1987 "Crash."


The difference is that, unlike 1987, the US dollar has been holding up fairly well past couple of weeks while this sell-off in the markets has taken place. If the dollar starts crashing along with stocks and commodities, run for the hills.
Is it possible that the Fed has (1) inflated a big dollar denominated bubble with super-low interest rates, then (2) raised rates far enough that the bubble investments look poor on a risk-adjusted basis, so that (3) there is a rush to dollars to de-leverage?
Yes, investors clearly are dumping risky investments for less-risky investments, including cash. However, the U.S. dollar, the global reserve currency, is looking more shaky due to the huge debt and trade/budget deficits of the U.S. The Fed erred in keeping interest rates too low for too long and investors paid for it with the NASDAQ crash of 2000-2002, and the subsequent real estate bubble which is now beginning to deflate. The so-called "commodity bubble" (including energy) is different. It is supply/demand driven. We're approaching peak oil, peak copper, peak clean water, etc., due to the expanding world population and the rapidly advancing economies in China and India. Ultimately, I believe there will be a U.S. dollar crash but it may be years away. In the meantime, it may be wise to keep some gold on hand. I suspect that peak oil will just exacerbate and accelerate the dollar crash since it will stifle the U.S. economy. Expect severe stag-flation.
Um, I beg to differ. us dollar has plummeted in last few weeks.


On 5/7 the June US dollar futures contract opened at the 84.90 level. I just checked the latest price (as of 7:30 PM on 5/22) and its at 84.33. That represents a total decline of 0.7%. I would hardly describe that as "plummeting". It's true that the dollar has been very weak since January, but the point is that it has held up pretty well during the vicious decline in the markets over the past 2 weeks. In fact, the dollar is up nearly 1% during the past week.
Would it be possible for you to explain your numbers for me.  I watch Nightly Business Report on PBS every night and have been following the dollar to euro for some time now, and tonight it closed at (correct me if I'm wrong) at .777xx.  Can you explain what this means.


You're quoting the Euro. I was quoting the U.S. dollar futures contract which is the value of the U.S. dollar against a basket of foreign currencies. The dollar has lost somewhat against the Euro in the past 2 weeks. I'm seeing an opening price of 1.277 for the Euro on 5/7, and the current price is around 1.288. However, the Yen was at 0.8949 on 5/7 and is at 0.8999 tonight. So, the dollar lost 0.86% against the Euro, but only 0.56% against the Yen. The point is, it's a very modest loss, as compared to the carnage in the stock and commodities markets. Furthermore, the dollar has been strengthening this week.
OK. last 2 weeks its been pretty constant. I guess I meant last 8 weeks, when it has gone from 1.18 to 1.29 vs Euro. thats a big move for 2 months, historically.

I dont remember what was happening in the weeks leading up to 10/19/1987 - was the dollar selling off before stocks did?

I don't have charts at my fingertips, but I recall reading that the dollar fell sharply, and the stock market was very weak, in the days leading up to the 1987 crash. That was the warning sign - the dollar was falling simultaneous with the stock market. In the present case, we have the dollar holding up (even though it's been weak in the past few months) while the stock market has been dropping over the past 2 weeks. If the dollar and the stock market start falling together, it greatly increases the chance of a real crash.
Here is a dollar index chart (June contract):


There has been a dollar selloff recently -- ahead of many of the market corrections. The biggest drop was in April. Then we got market corrections starting in mid-May, but the dollar decent stopped.
The only reason the dollar has held is due to a worldwide drawdown of riskier assets (foreign equities) & into USD "safe" investments.  So again, it's like recycling dollars.  In the absence of M3 info, I think it's clear that inflaton it starting to take a firm hold.

To combat that they will have to raise interest rates to maintain the dollar.  Problem is they will do so to the detriment of the working people and boom UNEMPLOYEMENT!

One thing we all seem to have missed was that last week Larry King did a program on oil prices.  I saw the last 5 minutes at 2AM when it was being re-run again.

Transcript here:


Guests include Robert Redford, David O'Reilly (Chairman and CEO of Chevron), Senator Kay Bailey Hutchison, Senator Dick Durbin, Daniel Yergin and Sir Richard Branson.

A lot of boosterism for ethanol.  I didn't see the whole thing and I am still reading the transcript so I won't say whether this was even worthwhile or not.

Yergin was the weakest of all, quite an achievement in a group that included two senators.
I watched the show last night as well.

It seems that much is being said about Ethanol... but the point that nobody seemed to bring up is EROEI... what will it be at best 1 to 1, 2 to 1 someday?  Anyone performed total calculations on this?  fuel required by machines to till the field, prep the land, plant the corn, fertilize, spray pesticide, harvest, refine... etc... etc...

Stunning Peak Oil Article (not by that name though) in Oil & Gas Journal

Early new field production estimation could assist in quantifying supply trends

By:  Rafael Sandrea

Oil & Gas Journal, May 22, 2006

Comments by Jeffrey J. Brown:

The article is behind a pay wall.  The article uses the "Hubbert Linearization" logistic technique to estimate peak production from a group of oil fields currently being developed.   However, the kicker is toward the end of the article, where the author provides his logistic based reserve estimates for the world and various regions, which are as follows (presumably for crude + condensate, in billions of barrels, or Gb, through 2004):


Total Recoverable Reserves:  2,000 Gb; 1,043 Gb Remaining;  48% depleted.


Total Recoverable Reserves:  225 Gb; 40 Gb Remaining;  82% depleted.


Total Recoverable Reserves:  195 Gb; 44 Gb Remaining;  77% depleted.

Saudi Arabia:

Total Recoverable Reserves:  165 Gb; 64 Gb Remaining;  61% depleted.

Final comment at the end of the article:  "There is a need for a fast track development plan.  At current rates of project slippage, depletion will continue eating into discovery gains."

Note that the author's estimate of ultimate recoverable conventional world oil reserves exactly matches Kenneth Deffeyes' estimate (also 2,000 Gb).  

If Saudi Arabia and Russia are both well past the 50% depletion mark, how can the world be at 48%?  That implies that there are some countries out there (many small ones or a few large ones) that are well below the 50% mark. Which ones might those be?
"That implies that there are some countries out there (many small ones or a few large ones) that are well below the 50% mark. Which ones might those be?"

Some obvious candidates are in the Caspain Sea area and Africa (both onshore and offshore).

O.K. - interesting. Matt Simmons always says that "if Saudi Arabia has peaked, then the world has peaked."  But I guess that might not be the case.  It may be correct to say "if Saudi Arabia has peaked, then the world is just about to peak."
I suspect that Saudi Arabia is keeping their production up via the use of horizontal wells.  In effect, they are probably "borrowing" oil from future years.  They will pay the price.   There also appears to be a "swing producer" effect.  Texas peaked, based on Khebab's work, at about 58%, while the Lower 48 peaked at around 49%.   Note that Texas oil production has dropped by about 75%, while the Lower 48 is down by only 50%.  

The Yibal Field, in Yemen, is a prime example of what happens when the water encounters the horizontal wells.  The Cantarell Field is another, emerging, example of what happens with water + horizontal wells.

Wow, Jeffey!  Those 58%/75% versus 49%/50% numbers are quite telling.  Do you and Khebab have a Graphoilogy post about that?
If you go to Graphoilogy, you will find some recent Texas, Lower 48, World and Saudi Arabia graphs.   Texas is to the Lower 48 as Saudi Arabia is to the world.
Notice the cumulative data is for 2004, (Q2004 = 957 GB). That would put the peak right about now.
As I said, kind of stunning.
I read the article pdf link and saw nothing of those world and region % depleted that westexas quoted above. Are there 2 versions?
You can calculate the numbers from those presented in the footnote on the final page of text.
Shyie-shyie xuewen! (I hadnt noticed the footnote)
Well I suppose that if was bound to happen ... my mind is officially boggled!

Saudi Arabia at 61 percent depleted! It may just be that I have not been paying attention, but I believe that this is the most pesimistic number that I have seen.

How unusual is it for a highly controversial position to appear in the Oil and Gas Journal? I googled the author, Rafael Sandrea, and came up with the following link to a number of his articles. http://www.its.com.ve/publications.htm

For what it is worth.

"How unusual is it for a highly controversial position to appear in the Oil and Gas Journal?"

I have a sneaking suspicion that the author snuck a Peak Oil article into the Journal, without the editors really realizing what he was saying.  I had to read the paragraph regarding the logistic reserve estimates several times to make sure I understood what he was saying.    

Iran's production has been declining slightly the last year or so. Can we add it to the countries that are past peak?

Original here
If net oil exports are falling, where would actual shortfalls show up first?

As everyone knows who has signed on more than one time, I am predicting an imminent crisis in net oil export capacity worldwide.  

If we assume a drop in exports, IMO here in the US we would see an initial drop in imports, followed by a price spike, followed by a (temporary) increase in imports, ultimately followed by another drop in imports, then a price spike, then another temporary increase, and the cycle goes on as we see progressive demand destruction--as prices equalize supply and demand.

What we would of course be seeing is a process of richer importers outbidding poorer importers.  So, the demand destruction should be readily apparent in poorer countries.  

Following are links to two stories outlining how two poorer countries are coping with more expensive oil.  They are cutting back, because they can't afford to buy all that they want at current prices.  This actually ties in with a NYT story on US driving patterns.  Just about the only US drivers that curtailed their gasoline usage were the ones financially incapable of buying more gasoline.

Thailand and Senegal, today, offer us a glimpse of our tomorrows.

Government, refiners move to prevent oil shortages

(FnWeb.com Via Thomson Dialog NewsEdge)fnWEB - Bangkok - April 26,

Small gas stations had closed not because of short supply, but apparently due to the rising oil prices, which had already seen domestic consumption of diesel drop from 55 million litres to 51 million per day and gasoline from 20 million litres to 18 million daily, he added.

Senegal in dark as power cuts halt activity
By Diadie Ba


DAKAR (Reuters) - Dakar was known as "little Paris" during the post-colonial era because its sophistication evoked France's glittering "City of Lights" -- but these days the Senegalese capital is frequently plunged into darkness.

Soaring fuel prices and lack of investment in the creaking state-run electricity sector have caused lengthy power cuts in the city of more than 2 million people.

So, what we need is a "barrel" of "poor" countries and access to their consumption data. Do you have an "index" in mind that you would consider reliable?
It is my understanding that the only really reliable consumption/inventory data, in the short term anyway, are for the US.  
I suppose that one could argue that the sooner that Third World countries adjust to a less oil dependent lifestyle, the better off they will be;  nevertheless the fact remains that the US is probably outbidding them for oil supplies--which were largely used for nondiscretionary purposes in Third World countries--in order to maintain our high consumption lifestyle.

To put it in its simplest terms, we may be taking oil away from poor farmers and fishermen in order to supply our large SUV's and McMansions.

Somehow, I don't think that this is going to make the US more popular around the world.

I had earlier theorized that BCR planned to seize control of the oil fields in the Middle East and then in effect renege on the federal debt.  I suppose that it might be more accurate to say that they planned to seize control of the fields in order to force exporters of all types to continue to accept dollars.  

I suspect that the emerging definition of a terrorist state is an oil exporter that refused to accept payment for oil in dollars.  This weekend, one of the talking heads on Fox had some interesting questions/comments regarding Chavez & Venezuela--Do you think that Chavez is using oil as a new weapon of mass destruction?  Are there links between al Qaeda and Chavez?  Don't you think that we need to do something about Chavez before Venezuela becomes something like Iran?

IMO, the only rational--and moral--course of action for the US to take is to replace the Payroll Tax with an Energy Consumption Tax.  Unfortunately, I suspect that the course that BCR are pursuing is something along the lines of sell us oil for dollars or we will talk about nuclear weapons.

I think you might be right about BCR using military force to prop up the dollar, instead of contemplating reneging on the national debt (which would end US hegemony.)

Lt. Col. Karen Kwiatkowski worked for Douglas Feith's "Office of Special Plans" in the Pentagon, and said that Saddam's plans to convert to oil payments in Euros was the primary cause for our invasion. Or at least she thought they talked about that as much as anything.

I think BCR would like to bully the world into selling us oil for fiat dollars, but their power is rapidly ebbing. All three of them are under sustained attack, mostly as a result of the prolonged failure of their policies to accomplish the above.

I've been a bear for three decades, but sooner or later I'm bound to be right, and I think the US's luck is finally beginning to run out. If the dollar drops, and oil exporters follow Russia's lead and convert to Euros, and China and Japan start to diversify their portfolios, oil could become far more expensive in dollars, but not necessarily other currencies. Which would be a way of correcting for US extravegance, and "sharing the wealth."  

"... is to replace the Payroll Tax with an Energy Consumption Tax..."

At which point would you assess this tax? What I mean to say is, would I be tax liable only for direct energy consumption? Like heating, electricity, petrol, etc. The rest of the tax would be "hidden" in the cost of goods (services) I purchase?

"..sell us oil for dollars or we will talk about nuclear weapons."

I'm not entirely convinced this is the case. BCR, or better still, the Neocons, probably don't have a particular affinity to USDs as such, they simply want to ensure that access to the resources they feel are essential to US (their) best interests remain unimpeded. Only the loss of the presidency would actually challenge the Neocons, so I don't think Cheney or Rumsfeld going would necessarily have an immediate impact.

The Straussians spent an awful long time in the wilderness, some being turfed out by Bush Sr. during his reign, so I think it will take more than a few scandals and some bad press to remove them. This is why I perceive them as particularly dangerous. They appear to be beyond morals, ruthless, and willing to go to any lengths to ensure their survival.

"At which point would you assess this tax?"

I would use the existing tax system, and tax energy at the retail level, principally at the delivery point to the customer--pump, electricity meter, natural gas meter, etc.  Note that I am not talking about an increase in overall taxation (beyond what we would have anyway).  I am simply suggesting that we tax energy consumption instead of payroll in order to fund Social Security and Medicare.  

As a depressing aside, here in Australia, we have recently had the government announce the latest budget. Included in the budget were widespread and extensive income tax cuts. However, latest opinion polls show the government less popular following the release of this budget. In attempting to understand the public response, at least one media pundit has suggested that the public are unhappy because they would have preferred a cut in the petrol excise (gasoline tax).
Essentially, you want to reward "savers" and "punish" "spenders?"

Clearly, there would be no threshold. So, how would you deal with those suffering "fuel poverty?" What if fuel contributes more than, say, thirty percent of one's income. How would you deal with that scenario?

"How would you deal with that scenario?"

If we do nothing, we will all be paying both higher energy prices and Payroll Taxes.

As Jim Kunslter says, whether we like SUV's are not, we are going to be forced to reduce our energy usage and our high consumption lifestyles.  

I am merely talking about accelerating trends that we will inevitably see anyway.  

Have you done any estimate on how high the tax rate for energy would have to be to replace the income tax?  In 2003 US individual income tax totalled $1.95 trillion.  The top 5% of earners paid 50% of the tax, because we have a progressive system where people who earn more pay more tax.

But an energy tax wouldn't be progressive.  In fact, it will be easy for the wealthy to move to the best locations , buy the most efficient cars, and upgrade to the more effective heating/coolong systems.  So the bulk of the tax burden would be levied on the poor who have to commute the long distances and drive the older cars.

Now back to the $1.95 trillion.  There are about 100 million households in the US.  On average they will pay $20,000 in energy taxes.  Of course the poor will pay a little more for having the bad judgement of living outside the cities.  Lets say, for the sake of arguement that half of that comes from gasoline sales.  That means $10,000 tax needs to come from 600 gallons of yearly gas usage (15,000 miles at 25 mpg).  Your gas tax would be $16+.  Add that to the wholesale price of gas ($2), and you've got $18 gas at the pump.  $250 for a working family to fill up their tank.

And year over year, as we conserve, the tax per gallon will have to increase to raise the same amount of revenue.  It's like taxing the poor for being poor.  If we tax them hard enough we can disincentivize their poverty and then they will have no choice but to get a high paying job like the rest of us.  That's the "invisible hand" hand of the market at its best.

Energy taxes are a great idea.  But in addition to income tax, not as a replacement for income tax.  One thing's for sure, you wouldn't have to worry about Mexicans sneaking inot the US if gas was $18/gallon.  :  )

It might help if you read what I posted.  

I said nothing about the income tax.  I'm talking about the highly regressive Payroll (Social Security + Medicare) Tax, which is payed primarily by the middle class. The majority of US households pay more in the Payroll Tax than in income taxes.  

My bad taxman!  Sorry about that.
I have proposed a variant of Westexas's idea.  

We enact taxes that will get incrementally higher from a low base (say raise gas taxes 1.5¢/month for the next 20 years).  People KNOW the taxes will rise even if they think oil will not and start making "structural adjustments" with adequate time (sort of) and minimum (but not zero) pain.

Mitigation efforts (more Urban rail for example) are paid out.  The total for the fiscal year 2008 (ending Oct 09 I think) of taxes collected minus mitigation is found.  15% is put into social security (everyone gets a small private account or it goes into the trust fund) and 85% to reduce next years taxes. The new FICA taxes for 2010 are calculated.  Let's say employee % drops from 7.15% to 4.83% for 2010.

Oops... it seems I also mixed payroll with income tax. But my remarks for compensating people not paying them are still valid.
Thus my dedication of 15% of the net tax collected to Social Security + Medicare.  Perhaps 10% to improve Medicare (lower copays, cover more, etc.) and 5% to improve the fiscal soundness of retirement & disability payments.

Rough justice, perfect fairness simply cannot be done.

Yes, in the US, the rich actually pay a lower percentage to social security.  Once you hit around $90k (in 2006), you don't pay any Soc Sec.  so someone earning 180k/ year pays half as much as a percentage of income as someone making 20k.  Of course the wealthier person at retirement can say, I paid over 4x as much into soc sec through my life as the person earning 20k/ year.  Why is my monthly soc sec check only marginally higher than his?  The S--- will really hit the fan among the wealthy if they ever cut back on soc sec benefits to the wealthy as that will create a system where the more you pay into soc sec, the less you get out, and the less you pay in, the more you get out.
I think the idea is good, though the exact details will have to be worked out. Replacing the whole payroll tax is obviously  not a good idea - more appropriate would be to reduce it by the amount of the fuel tax income. This can be used to compensate for the regressive nature of the fuel tax - we can reduce the payroll tax more for people with lower income and less for the higher incomes.

A more problematic question is how do people not paying payroll tax (retired, disabled, unemployed etc.) get compensated for the increased tax burden. I think we do not have to rediscover the wheel here and we can take a look at the experience in Europe - where the high gasoline taxes are accompanied with appropriate mass transit for the people not able to afford to drive. Therefore any fuel tax hike should be accompanied by a large scale project to build adequate mass transit in the US - otherwise it could be accepted as a war of the state againts its poor.

If all of this is implemented gradually over the years I think the long-term effects will be excellent.

Do you REALLY think the working poor have a choice to get a high-paying job? The fact that high paying jobs pay good is plenty of incentive to have one instead of a McJob. The problem is that the high-wage jobs are few and far between and most of the jobs being created are the low-wage jobs the working poor end up with.

I hope you were being fetious about that "invisible hand" comment with giving the poor "incentive" to get a high-wage job. The incentive is built-in. Anyways, what would you study in college anyways? By the time the toner sets on that diploma, the job done got outsourced to India or China. And now the poor person is saddled with a mortgage on an education that lost its value before they even graduate.

Either fix your sarcasm detector or get a new one; yours isn't working.
Whether you were being sarcastic or not, an awful lot of the rich actually believe that notion you posted. Blame the poor for being poor, and all that. Not having parents to pay for college makes getting that high-wage job nearly impossible. Not to mention, the non-beautiful need not apply - no matter the education attained. Again, it's the poor's fault for not having money for cosmetic surgery to look like a movie star on that job hunt.

Put simply, Social Darwinism really blows chunks. And I was being sarcastic about the cosmetic surgery, but not without reason. I live in an area loaded with yuppies. They always look like movie stars.

Dam... now you have to fix your screen name detector too, because Testudo (not Engineer Poet) wrote the bit about poor people having to get high paying jobs to avoid high tax rates.
"Not having parents to pay for college makes getting that high-wage job nearly impossible."

What makes something nearly impossible? I grew up poor joined the military and got $1492 a month GI bill to go to college and had access to student loans and had tuition reimbursement from both my minimum wage employers.  I netted 45K a year the entire time I was in college between loans Gi Bill and my McJob (home depot) So if that was nearly impossible it seemed easy. (military service does include some cake jobs) Anyone who has the drive and the determination can improve themselves, som may have it easier but screw them adversity builds character.

Amen.  I've got a problem with "solutions" that punish the less affluent for not being able to afford Prius hybrids.  We got into this together, and we have to get out of it together.

If TSHTF, as some of us fear, there will be no tolerance of forward thinkers snidely commenting "I told you so".  The magic of American history is that when we've been challenged we've responded.  That history will be tested again in our lifetimes.  And when challenged the only legitemate solutions are ones that reach out and support the less fortunate.

the only legitemate solutions are ones that reach out and support the less fortunate.
Yes and no; the less fortunate can't be allowed to use that as an excuse not to help with the total effort.
FWIW, the 15K miles is the general "per car" number, a "per family" is 21K:

People in the average U.S. household in 1994 drove their vehicles 21,100 miles, far enough to travel from New York City(3) to San Francisco seven times. That number, however, represents the average of about 85 million U.S. households with vehicles in 1994, and the average masks significant variation. For example, typical householder A, an older person whose children had left home, drove only 8,600 miles in 1994. That same year, people in typical household B, which included teenagers of driving age, drove 29,900 miles. And people in household C, which also included teenagers of driving age and which had an income of $50,000 or more, drove 40,200 miles.


And of course, any time there's averages, there are the extremes. People with short drives or who use transit, walk, bike, etc. make up for the X-Treem Commuters. I saw this in the newspaper, but go and Google "contest" and "longest commute". Midas the muffler company had a contest to see who has the loooooongest commute in America. Are you ready?

186 miles. One way. (a laser beam takes one full millisecond to make that distance)

The winner of the $10,000 in gas money is this Dave Givens who lives by Yosemite National Park and works ar Cisco Systems. He's been doing this daily mission since 1989. Miles logged?

(2006-1989)*200 days a year * 372 miles round trip =
1,264,800 miles logged so far. That's equal to two round trips to the moon AND a trip back to the moon base! Only truckers and airline pilots log more miles behind their respective steering columns. Even at 30mpg, he's used up 33,000 gallons of pricey gas. No mention of the actual cars having been used over the years and zillions of miles.

Posted 4-02-06 and earlier:
Even though being and old fart, I believe an additional $2 tax on a gallon of gas is very necessary. Our current consumption of 140 billion gallons of gas would generate 280 billion dollars of Taxes. The 7.65% payroll tax paid by employees would be removed on the first $ 50,000 of earned income. The 7.65% paid by employers would remain and the self-employed would only pay 7.65% on the first $50,000.
After $50K of earned income there would be an incremental increase in pay-roll taxes up to the current  7.65%. The 7.65% would extend out to the current max cap on earned income and could be extended as is currently being done to insure sufficient funds to meet our currently projected requirements. Each working person would then receive an additional $765 for each $10K of earned income to compensate for the tax on 382 gallons of gas or about 8000 miles of avg. mileage or 40k miles for $50K or more. There certainly would be an incentive to save on gas and have more to spend on Whoppers.  Of course old farts like me with no earned income and who do most of the voting would object, as would the very rich, and all the self serving congress-folks beholding to their lobbyists.
Then we should also incrementally increase the tax on over the road and through the air commercial diesel consumption, to provide additional incentives for rail traffic. That won't happen until we are short of diesel.
How much do you suppose both would reduce our current 21 mbd consumption?
This would lead to a stock market crash and recession as it would be perceived to be extremely growth-unfriendly. I can't imagine any politician initiating something like this.
First, I doubt that my variant would.

Either Westexas or my proposal would mean more tax home pay.

How is this bad for Microsoft, GE, healthcare stocks, railroads, etc. ?

Yes, GM, not so good, but they are small fraction of the market today.

Well, it would be very bad for companies that use lots of energy - airlines, trucking, steel, aluminum, etc. (unless they were given exemptions, but that kinda defeats the whole purpose). If companies were allowed to pay workers less (to make up for the reduced payroll tax), then it would benefit some companies at the expense of others. In that case, workers would oppose it because they wouldn't receive the benefit of lower payroll taxes, but would pay higher energy costs. If, on the other hand, the reduced payroll tax was passed onto workers (their pay stayed the same but they payed less tax), then it would be a losing situation for business and they would oppose it strongly. I can't imagine any politician who support this idea.

I'm not saying it's a bad idea. I'm just saying it doesn't have a bat's chance in hell of ever being implemented.

That comment about Venuzuela is interesting to me regarding the talk on Fox about Hugo and Al Qaeda. First, Fox takes their daily cues directly from the BCR "talking point" of the day. Second, recently Condy "Oil Tanker" Rice and the US declared that Venezuela was a "non-cooperative" country in the war on an abstract noun. Apparently, this rationale can always be used for a country that 1) has oil and 2) is not doing what the US wants it to do. And in our own hemisphere! Oh, my!

Rationally, I can't believe this is happening. In quite another way, given the way BCR do business, it makes perfect sense. Where is this going? Nowhere good, that's for sure.

I have said it before, and it isn't a very popular line here on TOD, but there is currently very little in energy-related news to refute it, and much to confirm it:

"The only kind of power that ultimately matters in this world is the power that comes out of a barrel of a gun."

Nobody has a monopoly on guns (contrary to the beliefs of many BCR supporters).
what he is trying to say is nothing beats the power you have over a person when you have them at the end of the barrel of a firearm.
Political power grows out of the barrel of a gun. Mao Tse-Tung.

That was the original qoute and I believe the chairman was stating that without a strong military the words of a country are hollow.

The United States military DOES in essence have a monopoly on the guns.  They are unchallengeable militarily - if they are sufficiently ruthless in employing their "guns."  In the short-to-medium term, this fact will remain concealed beneath the veneer of seemingly successful world-jockeying vis-a-vis US economic weakness; but in the long run (and I am thinking in terms of a time-span of several decades), the US will increasingly cast aside these silly economic and diplomatic trivialities, and crush its enemies in a relentless military juggernaut.
Not very popular? I think it is the choir's third favorite line.
Uh oh, here I go again.  I came in saying you weren't being cynical enough, Dave.  You're a plenty cynical guy, but every now and then you sound amazed at things it seems you would normally think are obvious.  You could do a great Claude Rains: "I am shocked, shocked to find that we would steal oil in our hemisphere!"

If/When the TS-(sufficiently)-HTF we will do as Bob Shaw keeps pointing out and follow through on the "Three Days of the Condor" model.  We will invoke the Monroe Doctrine or the Carter Doctrine and use whatever military means we need and have available to secure the oil.  The administration is already building cases in the media for invading Iran and Venezuela.  We've already attempted to secure Iraq.  This is the reason the Iranians want nukes - to keep us at arm's length.  This is the reason Chavez has threatened to destroy Venezuela's oil infrastructure if they are attacked.  

You could call it the "Department of Defense of Our Lifestyle."  Cheney would probably go for that.

Have you encountered this advertisement about joining the army? after some quasi-patriotic BS and frames from our glorious successes in Iraq, some tough guy is saying:
"Join us to defend the democracy"
And a young girl:
"And the american way of life!"

First time I saw this I was shocked. I mean truly shocked, not like that famous "shocked, shocked, shocked" :) What struck me was that in the prime of a MSM media I had watched a straightforward admittance that we are in Iraq for defending the american way of life! How should people reconcile "defending american way of life" with the all-time stated reasons aka "war on terror" or "war for democracy"? And what is the next step of "defending the american way of life"?

What is new here is that the government propaganda is probably reaching a state showing these guys actually believe what they did/are doing/will do is for the common good. If this is the case... then we are in even deeper sh*t than most of us think.

I think you're reading way too much into that. My interpretation is that it just means "defending the U.S."

Some of the official reasons for being in Iraq are: to prevent Iraq from unleashing WMDs on the USA, and to fight the terrorists there so we don't have to fight them here. Plus which, the U.S. military is also engaged in Afghanistan now; it's not all Iraq.

I don't buy it. I do not associate "defending the american way of life" with "defending USA". The well-established stereotype of the "american way of life" is about that family living in a nice house somewhere in Suburbia, far away from the hazzles of the big city, earning a good income and planning for retirement. That so much cherished american privicy (or should I call it willingful alienation?) plus vacations to Florida or the Carribean once a year.

FWIW people come to this country exactly because of this idealistic picture and because of the easy living. I admit I could be wrong of course - I am also a newcomer here, and for me that "american way of life" has a specific meaning because of the sharp contrast with what I've seen everywhere else (no car ever needed in Europe).

  I am in full agreement, or perhaps moreso..  This propaganda is playing on the anxieties of many Americans (Very old anxieties).. that 'They'   want to take   'It all'   away from us.  The term 'American way of life' is an emotional euphemism for our whole civic identity and of our being permitted to keep any semblance of the 'Life, Liberty and Pursuit of Happiness' that we were promised.  (It was going to be 'property', but Jefferson allegedly got 'Happiness' from the Six-Nations, the Union of the Indian societies which he studied and parlayed with extensively.)  

  It is made offensive enough in that any mention of 'defense' is unjustifiable, since Iraq clearly had no capacity to attack us or take away our 'Happiness'..

  Then, it is made tragic, when much of this happiness is only a fond memory or unfulfilled dream, as more people struggle to keep heads above water, keep jobs, keep health coverage, have their votes counted, their kids educated, their phone calls in privacy.. while the rich are coddled and cuddled.

IMO the history of the people coming to USA in search for the "American dream" is quite a tragic one... not only because of life not being a sing-a-song here too but also for many other reasons.

I think all of us are growing by getting to know ourselves; and happiness is when you get to know yourself that much that you know what true desires are; I think US is giving you a easy living and a system where you feel physically comfortable. But the system is designed in a way that constantly manipulates you and tries to turn you in an easily manipulated consumptive zombie. Resisting this and succeeding to find your niche of family, friends, community where you will feel not alone/alienated is very hard in this environment. And it's all going worse and worse.

To be more precise I think the message was "defending the american way of life" = "defending your way of life" (lifestyle) = "defending your well being" - your job, house, plans for the future etc. The message was well targeted and was definately not a random choice of words; I'm certain that even the choice of a young girl (20?) was not coincidence - what a better symbol of the future than that?
One "technology" that has truly advanced in the last few years is the art of mental manipulation. Every single word, image and sound is carefully crafted to send mixed messages into the multiple parts of the human brain. The beauty of this technique is that we are all in denial. We all deny that we are irrational, emotional creatures filled with fear, rage, a sense of powerlessness and a need to be part of the herd: Join "Us" (Don't be one of "Them"). Defend Democracy (DD alliteration where Dem resonates with Them). Way of Life (Stay the course and survive). Choose with your "heart" and not with your head.

My very elderly grandfather, who once served in the Heer (the army of the Third Reich) like many 'good Germans', and then emigrated to the United States after the war, recently said to me:
"We are becoming Nazi Germany."
I've been giving this quite a thought recently. It is striking how many are the similarities, though the details of course differ.

The most exact definition of fascism I've seen is "alliance of corporations and state against its own citizens". Well I'm sure that for anybody willing to see, it has been clear that in this definition USA has been (at least partially) a fascist country for decades now... What we are missing is only the wide-scale restriction of human rights of the ordinary citizen. But wait, aren't we seeing some worrisome developments with those, lately? It all starts too suspiciously resembling a planned transition, and they are doing it slowly enough - nobody to notice maybe? If I can deduce what will happen, here's what their plan is:

Stage 1: "Preparation". The populace is brainwashed and the groundwork is put in place for the next stage of turning the country into a concentration camp. We are here now.

Stage 2: "Crisis". An economic crisis is impoverishing the poor and the middle classes. It is of course blamed on external factors and is used as a pretext for a further tightening of the regime and restriction of rights.

Stage 3: "War". The state starts wars with that "external threats" - war(s) whose true aims are access to resources and enriching the military-industrial complex. For "the needs of the national security" the country is turned into a well-organized and subordinate fascist state.

These stages may not be consecutive and may overlap - as we see stage 3 has already begun, and stage 2 is also on the horizon.

Fallout/LeviK, good use of argumentum ad hitlerum.  Hate the government, hate yourself, hate SUV's it does not matter.

Stage 1 What are you talking about? Where will we put the camps? In Area 51 with the space aliens?
Stage 2 Unemployment is at low and the economy is decent.
Stage 3 Did you make these stages up or copy them from an AMWAY project plan? Where are you getting your material?

Comparisons of the current US government to Nazi Germany are inflamatory and do not apply.  Fascism is not "alliance of corporations and state against its own citizens" and who came up with your three stages?

Americans are out for themselves, That is why the Army changed their recruiting slogan from "Be all you can be" to Army of One. Researchers determined americans were more selfish since the 80's. We are no closer to fascism than we are communism.  And you can't make up new definitions to fit YOUR idea of what fascism is over america.  
 Thayer Watkins, a professor of Economics from San Jose State University, identifies fascism as aligned with corporatism, a form of economic oppression that he argues includes most of the world's governments[7]. Watkins, who some accuse of being out of step with the academic mainstream, considers Mussolini's Fascist regime to be merely one example of the corporatist states that emerged during the Great Depression, including such diverse political systems as that of Spain, Argentina and the United States.http://en.wikipedia.org/wiki/Fascism

This guy Watkins is your only supporter and his opinions are 10 times milder than yours.

This is like saying we are a theocracy because George is a christian.  

I think concentration camp is the wrong term.  The population does not need to be put anywhere, we are already here.  We just need to be transformed to an impoverished source of labor to be exploited, which is ongoing.  It's also the predominant role for the masses throughout history.  

But don't think the camps part isn't there too.  We already imprison by far the largest number of our people of any country in the world (by percentage of population and raw number), and from what I've been reading we have (and are building more) plenty of empty prison camps ready to go.

The combination of corporate control over government is how Mussolini defined fascism, which is also how I use the term.  All the rest is just symptoms, which can vary from regime to regime.  Just because you do not recognize some particular symptom that you are expecting does not mean that fascism is not present.

I am not talking about symptoms, I am talking about the definition of fascism.

"The combination of corporate control over government is how Mussolini defined fascism, which is also how I use the term." This sentence does not make sense to me combination of corporate control over government and what? What is the other half?

Mussolini said in The Political and Social Doctrine of Fascism:

"Granted that the 19th century was the century of socialism, liberalism, democracy, this does not mean that the 20th century must also be the century of socialism, liberalism, democracy. Political doctrines pass; nations remain. We are free to believe that this is the century of authority, a century tending to the 'right', a Fascist century. If the 19th century was the century of the individual (liberalism implies individualism) we are free to believe that this is the 'collective' century, and therefore the century of the State."

Merriam-Webster defines fascism as "a political philosophy, movement, or regime (as that of the Fascisti) that exalts nation and often race above the individual and that stands for a centralized autocratic government headed by a dictatorial leader, severe economic and social regimentation, and forcible suppression of opposition"

Mussolini defined fascism as being a right-wing ideology in opposition to socialism, liberalism, democracy and individualism.


Twilight, there are to many factions in america with to many subfactions for a unified fascism.  We are becoming isolationist and xenophobic but this does not translate to fascism any more than communism or democracy.

I agree that we imprison to many people for little or no reason.

Sorry, the words "combination of" were a leftover from a previous sentance arrangement.

If that particular definition of fascism doesn't suit you, and you'd prefer to just call it authoritarianism, or a right-wing ideology in opposition to socialism, liberalism, democracy and individualism, it doesn't change much.  Large corporations are mainly a tool for the benefit of the very wealthy, and whether than they run the goverment through corporations or more directly matters little.

I simply disagree that we are too fractious for fascism.

We just need to be transformed to an impoverished source of labor to be exploited

"Talk? No Mr. Bond, I want you to die now." --Goldfinger

Being transformed into an impoverished but alive source of labor is the happy outcome. Who says "they" even want or need "you" when there is this endless source of uncomplaining immigrant labor pouring in through the borders to pick the crops and scrub the toilets?

You need to step back to basics to understand what is going on here.

A few generations back, you may have been a corn farmer and I a wheat farmer. We were each producing a tangible something that is necessary for sustainability of "our way of life." It made sense for us to trade corn for wheat so we can enjoy a variety of products. That was the beginning of our Adam Smith economy.

Flash forward to present day. You are a financial analyst and I'm a lawyer. We exchange "services" because we are part of a "service/information economy". At the end of the day, although we each do "work", we produce nothing but hollow noises (financial analysis results or legal opinions). Someone has talked usinto believing that these are "valuable" things to produce.

Somewhere else in the world (China, India) there is a rice farmer and a soy farmer. They look around and ask, why should we "trade" with the noise makers when we can trade directly with each other?  We don't want noises any more, we just want rice and soy.

Agree that the above over simplifies things. But it's sort of about the state of affairs in the fable, Emperor's Clothes, where the common folk realize the royal noise maker ain't got anything going on for himself anymore but an intangible garb made of hollow noises. In other words, we've been had.

Ouch... I used the words "turning the country into a concentration camp" figuratively without thinking it will be accepted directly. Mind you, I don't expect that we will have an electric wire fence around every subdivision and a gunman on a high spot. Nope... "they" do not need that, and it is grossly uneffective when you think of it.

It is enough that the appropriate services take control of your private electronic communicitions and start tracking your location and bank accounts. After that you may continue to think you are "free" as long as you want.

Fallout's grandfather said:
"We are becoming Nazi Germany."

It's unimportant whether you correctly label this phenomenon as "facism" or something else.

The real point is that certain crazy thoughts/ideas are circulating through the consciousness of mainstream America; sort of like how crazy ideas circulate through the head of a mental patient. Germany went whacko after WWI as its economy and whole concept of how the Universe is organized came under challenge by reality (hyperinfaltion, an unsustainable economic situation). They dealt with it by creating an "Us" versus "Them" paradigm. "We" are the superiors while "They" are the inferiors and we must put them in their place. We must demonstrate that they are the inferiors and we are the superiors.

If you study Bush/Cheney/Rove's moves after 10-1/10+1, you will see the same dehumanization of the "Them" as being evil terrorists and the engrandizement of the "Us" as being the undeserving victims of the "Them" and how we need to put "Them" back in their places by showing Them that "Us" are the master nation, the superpower, the rulers of the Universe. We need to shock and awe them into submission and into understanding who's who and what's what.

The blood of many an American patriot may boil from making comparisons between the dysfunctional behavior of post-WWI Germany and the dysfunctional behavior of post-Vietnam/ post-IranHostage America. Maybe years from now, both countries will be able to look back on their dysfunctional pasts and understand how they came to be.

"If you study Bush/Cheney/Rove's moves after 10-1/10+1, you will see the same dehumanization of the "Them" as being evil terrorists and the engrandizement of the "Us" as being the undeserving victims of the "Them" and how we need to put "Them" back in their places by showing Them that "Us" are the master nation, the superpower, the rulers of the Universe. We need to shock and awe them into submission and into understanding who's who and what's what."

Let's assume this is BCR's exact thought...this is not what happened in Germany.  The German majority spiraled into nationalism blaming their problems on the jews inside germany.  Americans blame their problems on terrorists and mexicans and republicans and democrats and blacks and whites and french people especially.  There will never be a unified front we are to diverse.  There is no master race so long as Jessica Simpson, Jessica Alba, and Beonce are being portrayed as sex symbols.  There are tons of immigrants from every nation and a hodge podge of faiths.

Saying Hitler or Nazi is an easy bomb to drop in a debate but it is disrespectful to every jew burned in nazi furnaces. To every Marine and GI and Sailor from the Allied Nations that stopped the nazis. To history which you water down with this discussion.  The nazis shaved the jews heads for wool then pulled gold teeth out of their head to use for their war effort.

What you are doing is the equivalant of flicking a booger on a white wall then calling the wall green.

disrespectful to every jew burned in nazi furnaces

No disrespect intended Oilrig-medic.
Actually, I am second generation.
Both my parents are Halocaust survivors.
If anyone has a right to keep wondering, why the Germans became what they became in that time period, it is I.

Some of my WWII surviving relatives reflexively finish the opener: "The only good German .." with the pre-programmed answer, "is a dead German."

In other words, don't ask questions. If someone has bad thoughts in their head they deserve to die period. The thoughts are genetically hardwired into them. The only answer is to kill them all. Kill. Kill. Kill.

I find that answer wholly unsatisfactory.

Something happened in Germany.
Something happened in Cambodia.
Something happened in Mao's Red China.
Something happened in Stalinist Russia.
Everywhere you look in the world, so called "human beings" did or do act in grossly inhumane ways.
There is no reason why it can't happen here (in God-blessed America) and maybe it is already starting or progressing beyond the tipping point.

I too believe that BCR have no intent to resurrect the Reich. But they do have notions of American/right-wing Republican superiority, that somehow "we" are better than "them". That the ends justify the means. That the Unitary President is above the law. That it is OK to use the "terrorist" boogeyman noise to coral the sheeple into submission. All of this has a familiar smell to it. It scares me.

Never forget. Never again. (Let's hope.)

P.S. The booger has already buggerized itself across the entire Internet white wall. The booger is called NSA/Bush. It slides along the green slime stream of labeling everyone a "terrorist threat". You are a terrorist threat. I am a terrorist threat. If you don't stand up and call a Nazi a Nazi, you only embolden them. It is only when you shine the spotlight on them that they slither back to where they came from. We need to stop the BCR booger before it spreads its tentacles even further. Maybe you are a patriotic Republican. A truly patriotic Republican would be against unConstitutional activites as much, if not more so, than a leftward leaping Liberal. I know there are good Republicans out there. BCR are no Republicans.

Step Back:Yours is the post of the week.
Fallout/LeviK, good use of argumentum ad hitlerum.  Hate the government, hate yourself, hate SUV's it does not matter.

Where did that come from? Like I said elsewhere I have a decent respect for the government in principle. But as a person that lived in a comunist and then post-communist country I can tell you - there is nothing more tempting for a goverment (and easier actually) than manipulating its own people. The fact that this same thing is happening in the USA I'll leave without proof - I find it self evident for the deminishing minority of thinking people here.

Stage 1 What are you talking about? Where will we put the camps? In Area 51 with the space aliens?

What are you talking about? Did I ever mention conc camps? I am talking about a long-term plan to deprive us from our constitutional rights in order to secure the well-being of the government+corporate oligarchy. You may not like the word "fascism" describing that, but at least the author of the fascist ideology seem to agree with me this is just that.

Stage 2 Unemployment is at low and the economy is decent

You forgot to say the word now. And since I have contacts with lower/middle income people I can tell you from first hand that most of then are absolutely positive that life now is getting harder with each year going by. And I agree because I feel it by my own pocket... the inflation is eating hardest to people with lowest incomes, prices of everything are rising (in spite of the official inflation) and wages stay the same.

Fascism is not "alliance of corporations and state against its own citizens" and who came up with your three stages?

No matter how you frame it or you label it - that's what seems to be happening. We have a totally corrupt government waging wars abroad and restricting liberties at home for the benefit of the few. My "3 stages" are borrowed from the history of all empires or candidates for empires (Roman, British, Nazi Germany, Soviet and now US). Just take a look at the lies our government pushing to us to the media... where do you think this all leads to?

"What are you talking about? Did I ever mention conc camps? I am talking about a long-term plan to deprive us from our constitutional rights in order to secure the well-being of the government+corporate oligarchy. You may not like the word "fascism" describing that, but at least the author of the fascist ideology seem to agree with me this is just that."

Read your post above with your three stages. You typed concentration camps.....hence my response.

"My "3 stages" are borrowed from the history of all empires or candidates for empires (Roman, British, Nazi Germany, Soviet and now US)." The romans and british never went through those stages, and the soviets did something of a different twist. I don't understand how you are coming to you conclusions.

Read your post above with your three stages. You typed concentration camps.....hence my response.

Sorry, I used conc camp (as I replied to Twilight) figuratively and simply forgot about it. I assumed it was obvious you can not turn a whole country into a real conc camp - but nowadays you can very effectively put other means of control.

The romans and british never went through those stages, and the soviets did something of a different twist. I don't understand how you are coming to you conclusions.

Hah... and whose idea was "go to war if things go bad at home"? Romans, right? Then came the British who were luckier because they were so much technologically superior to their colonies that it was not that necessarry to fight - but even they also had to do it from time to time. With war always came the restrictions of liberties at home. And the Soviets? Whose idea was to conquer the world based on the revolution of the impoverished workers?

It is all one and the same schema applied in different variation and with different success, this is my point.

  Hence my comment Argumentum ad hitlerum you dislike percieved government control and war.  There has been war in all those countries you mentioned and virtually every other country's history.  They have not (save Germany) been fascist.  Russia was not even Communist, (as we are not a democracy) it was a dictatorship with an elite few oppressing the few.  Are people oppressed in the US yes driving through georgia there are places with only country music and the bars have only DOMESTIC beer. Its awful oppression, hopefully someone from amnesty international will read this and bring them some Guiness. You came up with three stages whose final endpoint is fascism and only one of your example became a fascist country.  I really dislike some aspects of the government but I can't just say Hillary Clinton is a fascist if I don't like her policy.  It does not apply.  I think the Israeli government has the most comparisons to the Nazi government in their treatment of the palestinians, but it is still a seperate situation. Jews in Germany never attacked the Germans.  Palestinians and other arabs have since the founding of Israel forced them into a defensive posture so here to call them Nazis is a misnomer.  

My point is you are ranting and making claims with no logical backing and several fallacious arguments. Criticism of BCR for an unprovoked war with examples and references is fine. But your flight of ideas borders insanity and paranoia.

Well it looks you like the labels. Yes, Rome was not a fascist... it was just what? Slave republic? Nor did Britain or Soviets, the latter not even being good enough to be called communist. Guess this makes them all much better than the Nazis which were fascist hence they were evil, evil, evil.

Personally I think you don't get it. These are just words, labels, sounds - what stands behind them are different forms of control of the elites over the populace. With the current militaristic state and shovinist retoric, with its openly stated sense of supremacy over other nations, our current regime resembles more Nazi Germany than the Soviet empire. So what? Does it mean we are going to see conc camps this time? Maybe yes, maybe no - I think no, but who knows? And you talk all the time like I claim that we are all-functioning fascist state, where Guiness is prohibited under the fear of being shot (though the prohibitation to buy alcohol on Sundays here is really annoying). What I'm saying is that we may be headed in a similar direction (which the future historins will call what? bongo-dungo? does it matter?), because of the following:

  1. We are militaristic.
  2. We are (or about to become) worse economically.
  3. We are being deprived by liberties we took for granted before (watched the news recently?)

You may call this paranoia, but when I start smelling smoke I usually expect to see the fire soon. And I prefer to call for the firefighters before seeing it.
You compare us to Nazis and I say it is an invalid comparison.  I could say these oranges are just like blueberries because they have fructose in them. None of your claims are specific or definitive of fascism
+++We are militaristic.
     An we have been for 200 years
+++We are (or about to become) worse economically.
     A statement that is always true, infinite growth is impossible.
+++We are being deprived by liberties we took for granted before (watched the news recently?)
     Which ones? I watch the news every day and surf the net.
(incidentally how long have your liberties been depriving you and why haven't you called out for help. )

Levin, you are not arguing fascism you are protesting milgov if I understand your influx statements.

I can not argue fuzzy logic. I could be smelling smoke, but this could be just somebody trying to burn his crap.

+++We are militaristic.
     An we have been for 200 years

Actually only for the last 60 years, at least at such scale. Stranger question is why we become even more heavily armed after our biggest enemy collapsed?

+++We are (or about to become) worse economically.
     A statement that is always true, infinite growth is impossible.

Yes, but this is unique experience for a country that has been always going forward, except some minor fluxes. Elites pushing for harder use of the stick in the absence of carrots is a very real possibility.

+++We are being deprived by liberties we took for granted before (watched the news recently?)
     Which ones? I watch the news every day and surf the net.

Oh, which ones - you can now be arrested, interrogated and even locked only by suspicion of being a terrorist. We are all assuming now that this does not/will not concern us, but you know how dangerous assumptions are.

Levin, you are not arguing fascism you are protesting milgov if I understand your influx statements.

OK if a country maintains an army which is obviously much larger than what is needed for the country's self defense, why does it do that? You call it milgov, I call it fascism - whether it is control of your own people or people in other countries... doesn't really matter. I just see it growing in the future and the grasp of control by the elites (both external and internal) becoming worse as the energy and other resources start to dwindle. This is yet another obvious parallel with Nazi Germany which did the very same thing.

I don't think I have anything else to add to this conversation - just that I didn't mean a Nazi style type of fascism will be taking over this country starting tomorrow. Rather I see a more subdued type of control at home and probably a little bit more harsh abroad.

Just as a side note, I only quoted my grandfather. Neither Hitler nor fascism was explicitly mentioned in the post (although grandpa did make the comparison with fascism in his conversation with me), thus the ad Hitlerum comparison is baseless.
He was, after all, alive for both periods of history. Something about apples to apples.
I do not presume to have such personal experience, and hence I do not quote myself.
  My response was attached to Levins 3 steps to Fascism post.  I maintain the steps (and the US current Trend) have nothing to do with fascism.  He is using the word only for inflamatory purposes.


I'm just trying to decide which book I should memorize.
Is this really any more outrageous than other commercial advertisements? These days, after the 'Enron Era' of big business dirty laundry being plastered all over the news, I can't believe anyone takes any advertisements of any kind seriously. But it just keeps on keepin' on...
Well... we are somehow expecting the commercial advertisments to be a brainwashing piece of crap explaining you what kind of loser you are if you still don't have the keys of that brand new SUV. I don't think most people have any higher level of respect towards those things - they are targeting the primary instincts and if they work for you... well this is your problem.

However at least for me the government is an entity which I'm used to listening when it talks. I have respect for the police, the army, and at least until recently to most of the people in charge. Presumably we have delegated those people a great deal of power and what they do is also our responsibility as a society, isn't it? The language of the government so much diverting to what I think most people think is a sure sign for me that it is being "hijacked" to the use of some narrower part of the society. Not a very nice thing to witness, IMO.

You have been trained since your first days in grade school to obey the "leadership" at the head of the classroom (actually it was an animal herding and branding corral, you just didn't see it that way, and probably still don't).

Of course, the training played its part like for everybody else... but I have also conciously accepted that as a member of the society I should follow the rules and respect the institutions that ensure the common good. It's not the propaganda that made me - I decided to do so, because this is the rational thing to do from my point of view, as long as what is good for all people is good for me too. I strongly object to denying them per se.

The tough question is what do you do when you see that those rules and institutions start to divert to the people's long term interest? We can just sit, watch and swear or we can try to change them no matter how hard it is.

I agree with this - it has always been my choice to follow the rules and laws - this is the only way that society can function, at least when combined with an orderly way to create the laws/rules, and universal application of them.  But when one can see that the application is not universal, and you know that the lobbyests are writing the bills to their advange and your disadvantage, what choices do you make then?  If that is how people perceive the system, then laws become only something you have avoid getting caught breaking.  It's a coice between the advantages gained by breaking the law vs. the disadvantages of getting caught.  

That's the kind of rot that pervades all totalitarian societies once people perceive that following the law is not in their interest and begin to step over that line.

It's fun to make lawyer jokes, but the law is no joke at all.

That's the kind of rot that pervades all totalitarian societies once people perceive that following the law is not in their interest and begin to step over that line.

Well... it is a little bit more complex than that. I'd describe it more like a "mass passive resistance". In the socialist block people usually obeyed the law - it was severely monitored by the authority and generally the education was excellent, no unemployment and the troublesome elements of the society were few and under control.

What happened was that the average honest person slowly became uninterested in cooperation with the system. It was not giving him/her freedom of opinion and speech, room for growth or even a decent living standard. Everyone started to look primary after themselves and their close circle; people began to shirk, small scale stealing from public property became so common (everyone did it in fact) that it got almost accepted as a normal by the society. The end was of course predetermined - the system collapsed economically and politically.

"It's not the propaganda that made me - I decided to do so, because this is the rational thing to do from my point of view, as long as what is good for all people is good for me too."

If there is propaganda out there, how do you know if your actions are a response to their stimulus or not?

How do you decide whats in the long term interest

One can never be sure of course :)

But you have to know yourself and the world around you. And most of all be able to identify your own deceptions. IMO there is an inherent feeling of truth in everyone of us that is letting us distinguish the right from the wrong - as long as we are willing to look for and face the facts. Sounds easy but in reality only a small number of people even try to do it - denials and self-deceptions are a much easier psychological niche to live in.

This is a point I have been making of late - there is now no difference between those who run the country and those who run the corporations.  They are run by the same people for the same purpose - profit (theirs).  

You will feel much better if you turn off the propaganda - just stop watching it!  Why willingly stand in a stream of shit?  The "entertainment" is not worth it, and the propaganda is in there too.  

For the time being, we can still connect to the world around us through the internet - a lifeline to reality.  It's pretty much the last one, now that NPR has been absorbed - although I still listen to it, I really need to stop, because if I'm not paying full attention too many of the lies creep into my subconscious and affect my thinking.  I ponder quite often how it will be once the internet is denied us and becomes just a shopping tool.  I know I am quite dependant on this one channel for all my info, and I also believe that soon I will be blind, unless by some miracle they cannot gain control over it.  I need to come up with a strategy for that eventuality - I can only assume it will involve person to person communications, with all the whisper-down-the-lane problems that entails.  

Maybe that's why I'm so interested in what happens here in the near future - I'm trying to calibrate my mental models of how things work, in anticipation of being isolated in a sea of corporate propaganda.

I also fear that we may be in the process of turning into a full-functioning fascist state, as I argued in my response to fallout above.

I am both optimist and pessimist here - times have changed and there are much more means of resistance, Internet also among them. Watching the BBC movie "Why we fight" yesterday convinced me, that while things look really bad indeed, still there is quite a lot of resistance within the system itself. Most important IMO is to fight those small, incremental changes that are gradually taking away our rights.

I've had a sneaking suspicion for a while that it will be the least developed countries (3rd world) that will in the medium and long terms be the best off.

As you point out, their demand for oil will be the first to be destroyed, at the shallow end of decline, ie when the rate of change of price is relatively low.

But secondly and perhaps more importantly, people in these countries are in general less specialised and less far removed from farming and the natural world than those in highly industrialised countries. They have, in a sense, less to lose and so may be able to adapt to the loss more easily.

According to bloomberg oil alternatives are gaining momentum:


The winner among the alternatives according to the article is GTL, but others are also mentioned:

Other alternatives using similar technology include coal, or CTL, projects, favored by the U.S. and China, which have vast coal reserves. Biomass, or BTL, projects include a factory in Germany that makes high-quality diesel from wood chips.

Is this marking the beginning of the transition to post-oil economy? As Hirsch predicted the most favoured technologies seem to be GTL and CTL (soon to come to your city).

How do you think: do we need to start moving our worries from PO to Global Warming?

CTL, GTL, oil sands, etc. will definitely help the situation, but I strongly suspect they will only lessen the rate of post-peak decline, meaning we'll have plenty of economic incentive for decades to come to move to renewables as quickly as possible.

I just posted a comment on my site about an article on Canadian oil sands production, and how that country's oil production (conventional + non-conventional) is forecast to peak in 2020.



I wish a could agree with you, but comparing the economics of CTL/GTL to renewables is simply ruling this out, at least in the medium term.

The bigger problem IMO is the infrastructure... the more advantegious renewables (wind, solar) are suitable to produce electricity or hydrogen; BTL and etanol are very suspicious from EROEI standpoint and I also suspect we will soon see their limitations. On the other hand there are vested interests the status quo of using liquid fuels for transportation to be continued by all means. Anything else (electric transportation) would require massive investments which our overdebted governments do not want to make.

As a result I think that GTL and CTL will be the path of least resistance and we will start hearing about them more and more in the next decades. In regard to renewables it is enough to compare the "huge" BTL plant planned in Germany (4500 bpd) to the CTL plants currently built in China (~50 000 bpd each, by memory).

Electric transport can be added incrementally and uses non-petroleum fuels almost exclusively.  Railroads can convert fairly easily (esp. if they get tax breaks on the infrastructure) and PHEV cars can be done one at a time.  Compared to hydrogen cars or DME diesels, either of which require a huge new infrastructure to make them practical, electricity is the path of least resistance (pun half-intended).
I'm wondering if ASPO's "natural gas liquids" on their general depletion model is the same as GTL?

Does anyone know?

Generally the term "natual gas liquids" has a specific meaning.  Essentially when you draw off natural gas, you get a number of compounds other than methane.  Generally all lightweight - things like ethane, propane, butane, isobutane and natural gasoline.
But is GTL the same as "natural gas liquids" as used by Colin Campbell of ASP?
IMO, No.  GTL usually delivers a very clean, usually transparent, synthetic diesel fuel, which makes sense, since they are building the stuff out of pretty much just pure methane.
City of Hamilton, Ontario Releases Peak Oil Report


Another good read...

Estimating the amount of oil in place

Excerpt from article above:

The logic of Richardson and Sterman's synthetic data experiment was quite simple. First build a system dynamics model that accurately replicates the exploration, discovery, and production behavior of the world oil system and assume that it is the "real world." Second, formally code and add the Hubbert and geologic analogy methods to the model so that they "watch" the "real world oil system" and create forecasts of the ultimately recoverable amount of oil in the "world." The results of the synthetic data experiment were that:

  • The model replicated the behavior of the actual world oil system very well.

  • The model replicated the actual forecasts produced by the Hubbert and geologic analogy methods very well.

  • Hubbert's method was clearly the most accurate.
  • over simulated time, the geologic analogy method rose to, and then overestimated, the ultimately recoverable amount of oil in the world.
    The implications of the geologic analogy method significantly overestimating the ultimately recoverable amount of oil in the world include:

    a possible reduction in oil conservation efforts.
    the probable overestimation of the amount of time available to develop substitutes for oil and the technologies, institutions and values needed to create a sustainable energy system.

    Excellent link, Estimating the amount of oil in place . In particular, they have an excellent model for overshoot and collapse, using elephants and shrubs/trees. Since vegetation is renewable, and fossil fuels are not (unless you're a flat earth economist), the conclusions are sobering.

    Also, they reveal that their models, based on Hubbert's curves, have been used by the Departmetn of Energy since the DOE was created by Carter. It proves that our society has it's head firmly stuck in the sand (or some other place.)

    Superb link.

    Models will continue to become richer and more informative.

    Check out the Oscillation Family graphic. This could be the historical record of my thought processes the day I stupidly clicked a certain hyperlink.


    Sustained: Meandering around the web checking out lingerie catalogues.

    Damped/Exploding: the wife's footsteps...quick, hit a political blog...hey, what's this?

    Chaos: Dieoff.org

    Looks like other developments are also gaining momentum


     "Iran is a troublemaker in the international system, a central banker of terrorism. Security assurances are not on the table." Miss Rice said

    "Peak Oil & Fascism"

    I've given it a lot of thought, and I've come to the conclusion that Kunstler is wrong about rural areas becoming unlivable because of "brigands" and such.

    We live on a small homestead on the edge of a small town in Arizona (within sight of the Mexican border to boot!). I have spent a lot of time repairing our barbed wire fences, and picking up trash left by illegals. And I've given a lot of thought to security, in the event of a crash.

    Kunstler bases his views, at least in part, on the fate of estate owners in Britain after the Romans left. If three men with swords approached our house, we would bar the gates and then run. One man with a sword wouldn't have a chance against three.

    However, most rural people out here are well armed (including us). With rifle or shotgun, or the ubiquitous AK 47, if I had the drop of them, three armed bandits wouldn't stand much of a chance.

    But it goes much further than that. Rural areas would band together in militias, and brigand groups would be hunted down and cut to pieces. If Mexican bandit gangs started coming across and causing trouble, they would be gunned down as well.

    But I doubt it would ever come to that. Our county (approaching 150,000 people, with 15 sheriff's deputies), would clamp down big time. Security would take precedence over planning and zoning, garbage collection, education, whatever. I have no doubts that our deputies, cooperating with a company or two of National Guardsmen, and backed up by as many armed citizens as they wanted, could keep order well enough. Probably too well. Government would respond both to forestall anarchy (which is contrary to their interests), and also to forestall the development of armed citizens' militias (ditto).

    If Mexican gangs (or even armies) were a menace, the National Guard would be deployed - even if they had to walk. They have enough munitions to last centuries.

    Rather than looking at the fall of Rome, or our own experiences in the Great Depression, we should look at what happened in Europe in the '30s. Especially Spain.

    Spain was flattened by the Depression just as everyone else was. So the urban areas launched a sort of revolution (lots of people wax nostalgic about it's socialist potential; but it is quite clear that the Republican cause was co-opted by Stalin.)

    Faced with urban insurrection, the Spanish church, the army, and the landowners cracked down and crushed the socialists. Then they kept the country locked down for 40 years.

    I have little doubt that something similar would occur here, if the country did indeed seem to be going up in flames or breaking down. Societies don't tolerate anarchy.  

    I don't know what would happen in the suburbs (probably something similar), but in the rural areas of the South and West, order would be maintained, with or without cheap gasoline.

    This, of course, is known as "fascism." But American fascism, instituted  under severe duress, and dependent upon a well armed citizenry, would presumably be quite different from the Spanish and Latin American variety.

    This is not to condone it or say it's inevitable; it is merely to strongly suggest that prolonged anarchy in the countryside is not very likely.

    How much violence have you experienced so far from the Mexicans entering illegally?  What is the attitude of your community at this point?  Would you all band together in case of a threat or are you too diverse in your political views?
    No violence to speak of. There was a mentally ill illegal who torced a number of houses and vehicles, but was quickly caught by the sheriff.

    The county is extremely diverse, and a lot of the newcomers have 10 acres and a double wide, and have no interest in community; but in general, there is a lot of sympathy for the illegals, but exasperation at the effects of being overrun. (the "minutemen" are almost entirely from well inland.)

    Right now there is no real "threat", as the vast majority of illegals are trying to get themselves or their drugs to the interior. But things could change, and if there was a real threat of anarchy and collapse, as per Kunstler, et al, I think our county would unite. (I was in San Francisco bay during the '89 earthquake, and the neighbors -- who had never spoken to each other before -- suddenly had time and shared interests on their hands, and there was a very quick feeling of community.)



    I'll bet your medical facilities are overwhelmed most of the time.  Where I live one can wait for hours in the emergency room while the undocumented workers are treated.  It's a hard issue and I can't really blame the illegals for seeking health care.  I tend to blame our government for not creating a workable system - that's why we elect the bums.

    Regarding your experience in SF during the earthquake:

    As an only child I've learned the hard way that a "feeling of community" is quite different from "community."  As in Paul Simon's great line "Negotiations and Love Songs are often mistaken for one and the same."

    One of the hardest things to for me to deal with has been figuring out the worth of a favor given and favor received - something that often comes with the territory when you've been raised in a large family or active and close-knit community.

    Part of being a Wal-Mart society is that we have grown up with fixed, non-negotiable prices.  That will be one of the first things to go when the warp of our technology and the woof of our humanity unravels.  And that's when the difference between a "feeling of community" and a "working community" will reveal itself.  A survivable community needs to have well-practiced negotiating skills amongst its members.

    What steps if any are you all taking to create more economic and social interdependence?  I'm not going to say where I think you live because you haven't chosen to reveal your location.  If my guess is right I have actively considered moving there so I'll be very interested in your response.

    I'd particularly like to know if you have a core group of maybe ten or fifteen people who take the issue of community very seriously and are promoting community building activities such as community gardens, barter arrangements, tool loans, etc.

    You are right about "community" vs "a feeling of community," amongst people who are getting a first glimpse of a possible one for the first time in their lives.

    The small towns I know of have community; the slower growing and more established, the better. The quickly growing instant cities don't have it. They are more like suburbs,and I really don't know how they will respond to a crash; though I find it hard to believe they would allow "roving bands of brigands" to destroy their lives without a fight.

    Much of the rural exurbia is a diffuse cloud of "10 acres and a double wide," which, though it might not have much community now, could grow it pretty quickly. You only have a handful of neighbors, and if there was a real need, you would learn the arts of reciprocity.

    But the small towns provide the leavening. After 15 years here, I've become a "neo native" and know most of my town and county elected officials, and when I go through the county buildings I know surprisingly many people.

    I love it. I really like knowing the people I pass on the street. And even if I don't know someone, if they've been here for very long I'm certain we know a lot of the same people.

    I lost that when we moved 3 years ago - it's starting to come back, but slowly.  Connections through the kids and school are quite helpful.  
    That's right in essence, but wrong in example.
    The Spanish government fell to attack not by the rebels, but by the rebels, the French, the British, the Italians, the Germans, and the Portuguese. The Russians sold them some guns and that was about it.
    What happened was the rebels landed in Spain and then moved through Portugal to invade areas where the Spanish army wasn't, because they weren't expecting Portugal to go to war against them. The Spanish army could have invaded Portugal and removed their government with the aid of the former government loyalists (from before the Portuguese government was overthrown) but Britain threatened war if they did. Then after they backed down the British attacked them at sea and blockaded them. France just shut the border where the Spanish government had control and then later when the rebels had advanced far enough, opened it for them. Italy and Germany invaded Spain with some troops, too, to help the rebels.
    Regardless of the dynamics of the war, the fact remains that the rural population and urban elites of Spain felt threatened by what they perceived to be anarchy or worse (communism), and crushed it and locked down the country for two generations. Ditto for Latin America in the 60s and 70s.

    Other governments - who might otherwise be hostile to the established order of said country - will generally come to their aid if they feel threatened by anarchic forces. This, by the way, also happened during the French Revolution; the neighboring countries (unsuccessfully) invaded France to try to reestablish the Bourbon dynasty (which they had fought against for generations), because they feared "the mob.

    The point is that societies don't tolerate anarchy, and that goes for the rural populations of the south and west. So the science fiction aspects of Kunstler et. al. feel wrong.

    Factor in my idea--if anyone thinks they have picked their perfect survivable community and set up their perfect off the grid farm, and networked with their community, times start getting tough, so the government starts redistributing people to the best "survivable areas" (kind of like they did in the aftermath of H.Katrina).  Altruism becomes expected, and you won't be banning together and shooting everyone that gets off the bus.  Nor will you when a two or threesome of starving beggars come by.  My grandparents dealt with that all the time in the depression years, because their farm was along a railroad line.  They gave the hobos a sandwich and they might have spent the night sleeping on their property and then they moved on to the next place...  Just something to think about.  Now, if their a threat to your own survival, that's another story, but I don't think that's how its going to be.
    I agree. What I'm referring to is the "roving bands of brigands" that are rife in Kunstler's literature, among others, who expect urban life to be better than rural, because the countryside will become too unsafe. As long as migrations don't threaten violence or displacement, they will generally be tolerated.

    When there is a collapse (like H. Katrina), the neighboring counties sherrifs blocked the bridges and roads and didn't allow refugees to escape the collapse of the city.

    One example from Iceland, a marginally habitable land and the poorest nation in Europe (Danish colony) till the 1940s.

    The church would assign poor people, often older w/o family, who would otherside starve to various farmers.  They were expected to work as much as they could and were fed and given a place of the floor with straw to sleep.  All were poor but these were the poorest.

    As I have noted before, the uncertain nature of the peak oil future leads people to project onto that future screen a world  they would like to see, be it Ecotopia, Mad Max or the Wild West.  

    "Rural areas would band together in militias, and brigand groups would be hunted down and cut to pieces. If Mexican bandit gangs started coming across and causing trouble, they would be gunned down as well...But American fascism, instituted under severe duress, and dependent upon a well armed citizenry, would presumably be quite different from the Spanish and Latin American variety."

    How Lovely.  So we are to look forward to Fascism, an ideology characterized by nationalism, militarism, authoritarianism and collusion between the state and business interests.  Add to this lots and lots of guns and the will to use it and it looks like we have the White supremacist's  ideal state, undoubtedly preserving America for all the real Americans and stop those brown people from undermining "our way of life."  

    I didn't point to the racist angle, but its' there.  I hate the idea of fascism, and I think at least in the west, it would be a last resort. And "last resort" is exactly what we're talking about, when the alternative is "roving bands of brigands" and depopulation of the countryside.

    Since you mention the Wild West, this is where I live. During the 1880s & 90s, some of these towns had extraordinary homicide rates. They clamped down by shooting or hanging anyone who got out of line (even for minor theft), and soon these areas became so peaceful they were dull. Prohibition began here and spread to the east, and notorious saloons closed down or became cigar stands.

    Many people forget that communities managed to police themselves long before the state or federal government had the means to do so (this is not a defense or criticism of the quality of 'policing' that was accomplished).  In extraordinary circumstances of crime or poverty, people brand together and create their own form of justice, which can often go too far and result in fascism.  I see your point and agree.
    I meant "band together", not "brand together", although we certainly see a lot of that as well!
    Yeah, those gangs sporting Old Navy or Polo logos scare me too.
    I didn't know that gun ownership led to white supremacy.  Does this mean that black gun owners will now be welcome into the KKK?

    I think you missed his point.

    Fascism would be just a desparate continuation of our existing
    lifestyle. It's the corporate state gone wild.

    Would a facist state survive for long in a post-petrol world?
    What are the vital economic ingredients that keep facism
    alive? Is facism more than just simple totalitarian rule?

    What will become of the American constitution? Will Americans
    tire of a facist state and kill it?

    Whoa. [Seems appropriate since we are comparing the great American West post peak with ???]

    Fascism implies a strong state and large industrial concerns that are already so clumsy and ineffiecient that not even the Government can screw them up so much worse that that they simply do not work anymore. A strong state implies the power to tax and the enough wealth to be worth taxing / pillaging.

    Many if not most gun owners that I know are not overly fond of the Government [with either big "G" or little "g"] as either the provider of a nanny state looking after their needs or a way to impose their beliefs on others.

    If given a choice of betting on the upper West side of Manhattan [a great place to find statists of all sorts IMO] or rural Iowa as a peaceful place post peak ... my money would be on Iowa.

    Good points. Perhaps Spanish fascism was a bad example, but English speaking countries don't have an example that I can think of since Cromwell. Perhaps abundant resources, colonies and imperial status have rescued us.

    Thinking of the spectrum of gun owners, we might more think of  the early settlers who formed militias to fight Indians, Mexicans or British. These attitudes run deep in the rural west. But there is also a thick layer of exurbian growth and complete dependence on the internal combustion engine. If and when these things were to wither away, you would still have a lot of armed people who would have a vested interest in banding together to protect their lives and property.

    I guess my point is that Kunstler and others' visions of rural life "after the apocalypse" more resembles zombie movies than any sort of reality I can envision.

    Jim: I agree with you. Actually, in the USA currently, criminals don't "roam". They control "turf". In the case of a post-peak societal breakdown, your physical proximity to the most violent areas (the ones with the most societal breakdown) will be important. New Orleans was a good example. The city had rampant crime before Katrina and during the crisis many members of the police force became criminals. IMO, you are far safer where you are than you would be living 5 miles from South Central LA or downtown Detroit, St. Louis, Philly or many other US urban centers. These neighbourhoods have already broken down culturally and will not respond well to a future of oil depletion (IMO).
    I was at http://ontpet.com/documents/energyfuture.pdf and I noticed that page 20 had some illuminating figures on drilling more and more wells for less and less gas in Canada. Page 25 had some figures for the US and I think part of the difference was that we had lots more offshore gas than Canada did. Page 23 made the problems of coal based methane obvious as the level of New Mexico, Alabama, etc, gas production leveled off when we hit the maximum salinity that the rivers would stand.
    One quick post, and then I am offline until this evening.

    Over at my blog, I have just posted the latest response in my ongoing debate with ethanol advocate Joseph Miglietta:

    Miglietta's Second Response

    Miglietta has been quite reasonable in his arguments, and on a lot of points his position is the same as mine. I will post my response by the end of the week.

    Second thing, you may have seen the post in yesterday's ethanol thread by "AsianFarmer" claiming that switching to 3rd world production practices, you could get an EROI of 2.34 with corn ethanol. I had a look at this claim this morning, and concluded that the EROI is at best 1.17:

    Correcting the Calculations


    If I look correctly at the calculations, they don't include the energy for growing and harvesting your inputs, nor the shipping of the final stuff. This will bring overall EROEI <1 (EROEI as calculated for extra energy input, not including the energy content of the vegetal source).

    Robert, I think you are absolutely right in discarding ethanol.

    I keep discussing these things with my brother in law and my cousin. My brother in law is France's 2nd exporter of agricultural machines for Europe (and he has witnessed a lot of suffering in east europe and heard a lot about Putin and pipelines). My cousin is heavily involved in biogas matters in Germany. My brother in law doesn't believe at all in biogas but believes in rapeseed. Both of them look away when we begin discussing fertilizer, pesticides, shipping of endproducts.

    Last weekend they both showed me their plans for solar and geothermal heating of their homes ...

    I am very against corn ethanol. But let me play devils advocate for a moment. Society is facing some tough times ahead. If we have a serious liquid fuels crisis, ala hirsch Report, wouldnt it be better to produce ethanol using coal as a feedstock at a very slight energy gain to avery societal collapse? Even at an energy loss?
    If we are going to use coal, it would be better to turn the coal into methanol and avoid that energetically costly distillation of water and ethanol.

    Regardless, I think coal-based ethanol is the road we are headed down. From an economic viewpoint, it makes perfect sense. From an environmental and sustainability viewpoint - what a freaking waste.


    You guys should all get a kick out of this portion of Joseph Miglietta's latest response on my blog:

    JM: First of all, there is still a lot of oil underground to sustain our needs for a few more decades.


    I love this kind of modern rethoric.

    It goes something like this :

    • first of all, the problem you mention doesn't exist (in this case, there is plenty of oil)
    • second, the solution is obvious and only a few nights of work away (in this case fusion)
    • third, actual solutions for the problem mentionned in 1 work fine and are the best (ethanol, which in fact worsens the problem and, if implemented, will significantly decrease the biomass of earth)

    Absolutely no logic involved, but this kind of construction is legion in corporate world.
    I found this part interesting

    There is no need to discuss any further the disadvantage offered by producing ethanol, its energy balance, farm land availability in our country, etc. Ethanol, however, is a starting point. Lets have the necessary infrastructure: distribution, fuel stations, and flex-fuel vehicles. Let's play along with the farmers. When the demand for ethanol is higher than what they can produce, or to farm corn for ethanol, the same legislation that they pushed for is going to work against them. Hawaii, for instance, cannot produce yet enough sugar cane, so they resorted to import ethanol.

    The oil companies are now pressed for ethanol. What we need is to reassure the farmers that importing ethanol will not go against their interests--a quota system should be established to import only the ethanol they cannot produce. When we have the necessary infrastructure, gradually, instead of importing more ethanol, we produce methanol, or produce ethanol from other sources.

    Many see corn ethanol and the E85 program as lemons.
    Sounds like he's found a way to make lemonade.
    Pulling off the second part will be difficult though, I don't see the producers of corn ethanol giving up their windfall without a fight.

    new scientist tech is claiming a breakthrough on fusion but the article is rather short and doesn't go into details. personally i think it's bunk but i am posting it here to have it torn apart by people who know more then i do in nuclear physics.
    And why do you think it's a bunk?
    It's not bunk, but also note that they're not claiming a fusion "breakthrough".  This is simply one step forward in the work on fusion.  And there will have to be many small steps made by the engineers working on the reactor designs before it is a viable energy alternative.

    Look at the journal this article is printed in and remember the target audience...  other engineers who will find this advance very interesting.  I wouldn't rush off and sell your ExxonMobile stock, but there is no need to belittle their work either.

    I have hopes that we will see an operating fusion power plant one day, but I have to wonder if it can ever be commercially deployed -- just from the point of view that the plants themselves will be mind-numbingly complex -- think Space Shuttle Complex.

    I'd like to see Fusion work out, but I'm not holding my breath. While the incremental improvement is nice, it's no breakthrough. Trying to contain the plasma is a real pain, and it may well never be solved. It may well take too powerful a magnet to contain it. 100 million degrees is some hot stuff!

    I suspect that if it can be solved, it could take centuries to do. For that, a place like the tar sands places would have to be deliberate last pockets of industrial civilisation that can run for centuries as they work it out. This is a long haul project. Maybe we'll get lucky, but nobody knows.

    I agree that this is just one small step forward for fusion. The technical problems involved in making a practical fusion reactor are daunting. One issue that rarely gets discussed is that even if a succesful fusion reactor is ever developed, it will generate copious quantities of neutrons. Aside from safety concerns (neutrons can at least be shielded against), the extremely high neutron flux will quickly cause the materials closest to the active region of the reactor to degrade and become highly radioactive. Therefore, its not as "clean" as some would suggest. Also, the lifetime of these parts would be greatly compromised. I've seen materials after they've been in linear accelerators for a few weeks discolor and begin to degrade severely.
    I have been struggling with the details of what a renewable energy grid might look like in North America, and then I will work on the steps to get there.

    As an aside, I see all wind turbine installations to date as being "Proof of Concept" experiments; working out the technology, financial details, gaining operating experience, grid impact is yet to come.  We are close but not "there" yet.

    I have accepted that we will need low efficiency (~60%) pumped air storage for the summer and will have to throttle back on power intensive uses (aluminum production) most but not all summers.  Depleted natural gas reserviors and other geological traps that could have held NG but didn't can hold a LOT of air.  Massive winter surpluses of wind power would charge pumped air reserviors.

    My newest #s; measured in % of total electrical energy consumed by users (assume 80% of today's load)

    Wind                    63%
    Hydro                    12%
    Other Renewable         13%
    Pumped Storage - Hydro +10% -12.9% 77.5% efficient (Day -Week Storage)
    Pumped Storage - Air   +12% -20% 60% efficient (Summer)
    Nuclear                    23%

    Other renewable includes geothermal that will be reworked from base load to running an average of 25% of the time at 4x the MW, solar thermal, biofuels (also used more as peaking power).

    Nuclear would do, as they do now, all scheduled maintenance during the spring and fall.  Doing this with zero nuke becomes quite difficult and assumptions have to move WAY over on every item (conservation = 30%, not 20%, more summer cutbacks, etc.)

    All connected by a continent wide HV DC grid.

    I figure demand will drop by 20% through efficiency and conservation.

    I will not argue if this is possible to accomplish technically. It may be possible, or may be not... I have the question of how do you suggest we get from "here" to "there"?

    All things proposed require a high level of nation-wide coordination and cooperation - e.g. building a pumped storage in Illinois to support wind mills in North Dakota powering a house somewhere in Southern California; building a transcontinental electric grid, possibly active demand management system, etc. Currently our electric grid is deregulated and there are number of state-wide and nation-wide utility providers. Who is going to coordinate between them? And... who is going to pay the bill?

    Step one is defining an achievable goal.

    Step two is some sensitivity analysis of this goal (how much can the different fractions of supply be balanced against demand management is one of several questions) and creating a range.

    Step three is defining the steps required and how they might be developed.

    A major first stage would be creating a wind turbine only grid in West Texas that feeds into a DC node, thus solving stability issues.  DC to San Antonio/Austin, Houston & D-FtW nodes.

    As output grows, add a DC link to Ozarks (outside ERCOT grid, so DC required) and hydro pumped storage there.  Ozarks Pumped storage complex also has DC links to St. Louis, KC & Chicago. Missouri and Iowa wind feed into KC node or new node.

    One possibility is a TVA run DC grid that offers free transmission for renewables, half price for pumped storage (unless filled with excess renewable power) and full price for fossil power. (Nuke at 2/3 ?) Perhaps a money loser, perhaps not.  Paid for with carbon tax (most of which is rebated back in FICA taxes).

    The idea is to figure out what would work economically, standardize DC voltage and build a bit ahead of need,

    The US is badly in need of new transmission capacity today, so this is unlikely to be wasted.

    The Dakotas have great wind potential (ND #1, SD #3 among US states from memory) but little production because of a limited market.

    Create a market that links the Dakotas to nodes near San Fransico, Los Angeles, Minneapolis, Chicago, Detroit, St. Louis, etc. and wind turbines would spring up !

    Due to climaic and time zone differences, peaks vary between markets.  Dakota wind could find a good price most of the time somewhere, displacing ever higher NG most of the time.

    Why a DC grid? If you are worried about capacitive loss from AC, you could just be swapping problems. you can't use transformers and corrosion galvanisation could be a problem [though I suppose you could reverse the polarity at regular intervals]
    I thought you US guys had the worlds largest unstable Caldera under Yellowstone? You could do a hell of a lot of geothermal power from that, and maybe save yourselves from disaster by cooling the plug so it doesnt blow/collapse. Of course the 'environmentalists' wouldn't want the view spoiled..
    Hi TI,

    I have posted some ideas after your reply to my post. I think you aren't going back to friday seeing the huge amount of posts in the other threads.

    "The Threat to the Baltic Sea Continues to Increase", an article in today's Lietuvos Rytas (largest Lithuanian daily); unfortunately, behind a subscription wall at http://www.lrytas.lt

    A few excerpts:

    Finland will soon take over the chairmanship of the European Union, and plans to use it to draw Russia's attention to pollution in the Baltic Sea, because as the volume of oil exports grows along with the region's economic activity, the intensity of traffic has reached a scale never seen before.

    At any given time, some 2,000 cargo ships are in the Baltic Sea, including 200 tankers.

    Every year, there are about 50 collisions or incidents in which ships run aground.

    From 1989 to 2003, there were only three accidents in which chemicals were spilled.

    The last time the Baltic suffered a serious oil spill was in 2003, when a Chinese tanker ran aground near Bornholm island, between Sweden and Denmark, and spilled 1200 tons of crude oil.

    The volume of oil tanker traffic will likely increase, as Russia increases its exports. In 2000, Russia exported 40 million tons, but in 2005, Russia exported 135 million tons.

    By 2010, the volume of crude transported through the Baltic may exceed 200 million tons.

    I submit this not to contradict anything that Dave, Khebab, or westexas have written -- I am impressed with their work, and what they have written on Russia makes a lot of sense. However, this article just adds to the data points that suggest many, many people in positions of influence still do not foresee an upcoming decline of any sort in Russian exports. It doesn't even seem to be on the radar screen.

    So if it comes to pass, all the more damage will be done...

    Check out my post (up the thread) on the most recent issue of the Oil & Gas Journal, which has an article estimating that Russia is 77% depleted.
    Turn out the lights, let's go home guys...Apparently peak oil doesn't matter

    Tinker says peak oil makes good press but really doesn't matter, first, because we won't know if we've peaked until 10 or 20 years later.  "It's really an exercise in the unknowable.  I guess it's just fun to forecast."  For another thing, Tinker says, in a sense, we're already there.  Demand is pulling the market now.

    It's an older article posted August 2005, any rate, it's interesting to see so many views on the subject

    Amusing article, but the level of ignorance displayed (on so many levels) was astounding. The most hilarious was the economics professor's belief that an oil future price of $46 for 2011 (as of 2005) made it likely that this would actually be the price of oil in 2005 as the "smart" money knows. Not to be negative, but this guy is totally full of crap. In 1998, what does he think the "smart" money was predicting for 2006 oil prices? $12. It's good to know he was the deputy grand poohbah of the Treasury. No wonder the dollar is toast.  
    LOL, ouch... I think I just cracked a rib laughing at your comments.
    Ha! That is hilarious. Didn't the government have some bizarro idea recently to come up with a "market-based model" system for predicting/tracking terrorist events? Because, supposedly the "market" would know where and when the most likely terrorist attacks would be.
    Oil futures contracts are in backwardation which means that 2011 oil is cheaper than 2006 oil. That doesn't necessarily mean that the "smart money" is forecasting declining oil prices. It may simply be caused by commercial fuel users (airlines, shipping, trucking, etc.) hedging against higher oil prices by buying the forward months. If you're running an airline, you're probably more concerned about fuel prices over the next few months than what they will be 5 years from now.
    Yes, it is funny and sad... the guy goes on to contradict himself... "you won't know if you've peaked until 10 to 20 years after the peak..." but then uh... we may already be there...

    How would you know if you're already there if you can't know that until 10 to 20 years after the fact... (his own words);  so does he think we peaked 10 or 20 years ago?  Of course not, he's a moron...  

    Hello Bradshaw,

    Included in this link was this quote from Scott Tinker that I profoundly agree with:
    Scott Tinker is director of the Bureau of Economic Geology, located at UT's Pickle Campus in North Austin, and is the state geologist of Texas.  Though he spends most of his time on oil and gas issues, Tinker is at least as concerned about "the other fluid in Texas, water." "It's going to become more and more valuable and eventually will be traded just like oil and natural gas futures," he says. "Someday it's going to be as if we were today spraying gasoline on your yard. You're probably just not going to have grass. Water is just too precious, especially in arid regions like this." Of special concern is the Ogallala Aquifer in West Texas, one of the largest aquifers in America. "You can just see it drawing down. It recharges at an inch or two a year, and we remove a foot or two a year. It's silly. We're just not managing it."

    Water is Life, period! The amounts of energy and infrastructure to provide water for agriculture, industry, and daily living is mind boggling, and adequately cleaning the water before sending it back to Nature requires an equal commitment of resources.  Future generations will say our profligate waste of water will be nearly as bad as our senseless wasting of fossil fuels.  Thankfully, it still rains and snows, but global warming is going to dramatically shift where it comes down in safe, usable quantities.  See this CIA graphic:


    taken from this voluminous CIA link:


    If anything will setoff huge migrations and wars--it will be for water.  I believe one of the reasons India and China have grown their economies so fast for so long is because they have invested in getting water, but not invested in cleaning it resulting in tremendous pollution.  Thus my earlier speculative post on possible Chinese glacial harvesting.  I worry greatly about Asia having civil wars and/or international wars for water and food in the near future.  Recall the postings on rioting in India, China, and elsewhere.

    If global warming combined with acquifer & detritus depletion recreates the American Dustbowl--ethanol farming does not stand a chance because we will be struggling just to grow sufficient food trying to stave off widespread violence.  Recall the recent graphic of how grain stores are declining faster than replenishment.  The first place the future starving rioters will try to put to the torch is any infrastructure associated with ethanol.  Expect armed guards at gas stations, and run-flat tires and armor on those who can afford to still run vehicles.  Recall the L.A. riot street scene where vehicles were showered with bricks and rocks from pedestrians.  Or expect martial law and the Halliburton camps-- the logical response to declining 'energy slaves' is to ramp up the human 'wage slaves'.  As Westexas has warned before: college grads and illegals will be working together in the fields.

    I would prefer the world's leaders to head this off by mitigation in all possible forms.  But recall Putin's idea of increasing birthrates [for future cannon fodder] despite the declining life expectancy.  To me, this exemplifys the real agenda of insuring 'energy security' for elites only in the upcoming G8 Conference:


    I think TODers should come up with a consensus opinion that we can forward to the G8 Expert Opinion Solicitation Forum linked here:


    I think referring them to Dieoff.com, Savinar's LATOC, ASPO's Depletion Protocols, and the TOD website should be included at a minimum, but maybe a well-written agenda to achieve the New PostPeak Paradigm would be best.

    What say you, fellow TODers?  I think TOD should send something so that these leaders can never again say that they were not warned-- the world's citizens would laugh them off the podium as we gathered the tar and feathers for their lack of proactive mitigation.

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

    I agree with the statment that water is life as well.   While fresh water may be depleting in Texas (I live in Houston), I personally don't correlate this at all with oil depletion.

    You can desalinate salt water (ocean / gulf of mexico) hint... texas can pull salt water from the ocean and purify it as potable water.

    We don't have an ocean of alternative fuel that we could convert so easily if needed...

    Desalinating water has one problem: It takes energy. Fortunately, it can be done with solar power in a largely passive setup. Get creative! Or, you can use reverse osmosis, but you'll have to use windmills to do the pumps for a largely passive setup. The solar method takes solar heating panels designed to distill the water instead of just heat it. Think of the old survival trick of the plastic bag, rock, and the cup in the hole.

    But to build industrial scale solar stills is the problem. You still have to conserve water instead of watering lawns in an otherwise desert.

    Most water use in the west is incredibly inefficient; pumping aquifers dry for alfalfa!

    Peak oil and gas will pull the plug on much of this waste, but unfortunately the former farmland is so depleted it takes years before tumbleweeds will grow in it!

    When energy costs go up, most irrigated farming will not be viable.

    Ironically enough, the ocean is in a fact a source of almost boundless energy, albeit not readily accessible.  One out of every 6700 water atoms is D20, or deuterium oxide, which is the fuel used in nuclear fusion.  If or when fusion becomes a reality, our energy problems will be largely solved.  It is the path to this new level energy which is problematic, if it is possible at all.
    Remember the "cold fusion" fiasco of the '80s? (If only it were that simple.) I believe the current research in fusion energy is using the deuterium-tritium fusion reaction under magenetic confinement (as opposed to laser or inertial confinement). The problem is maintaining a stable reaction at extremely high temperature (on the order of 100 million degrees centigrade). As some others here have pointed out, it's questionable whether we'll ever be able to achieve a practical system.
    Well,  they may get there some day...

    Relativistic Heavy Ion Collider


    150,000 times hotter than the sun...


    Or in laymans terms... 40 Billion X room temperature +- a few degrees :-

    The instruments that have been developed in recent decades for high-energy particle physics, such as the Relatavistic High Energy Collider, are impressive, and they're allowing us to probe matter under exotic conditions and verify advanced theories of matter and energy. However, they involve exciting very minute quantities of matter to ultra-high energies. I'm not sure they are going to help us much in developing a practical fusion energy source. To quote the nobel laureate in physics, Pierre-Gilles de Gennes, "We say that we will put the sun into a box. The idea is pretty. The problem is, we don't know how to make the box".
    I don't know if anyone's interested, but when I was looking into nuclear fusion as a possible source of energy, I discovered a really interesting fact.  There are so few ions in accelerators and/or tokamak, that temperature is actually a really bad way of describing the phenomenon.  If the structures broke, the effect would die, it would not melt everything around it.  There aren't enough particles for that to happen.  When physicists say that a tokamak creates an environment of 40 million degrees, they are actually saying that the particles are moving fast, or equivalently have a very high energy, an energy corresponding to roughly 40 KeV (if I'm remembering correctly).  Now a television moves electrons around at an energy of roughly 20 KeV, so you could say that the electrons in a television have a temperature of 20 million degrees, but that would be misleading.  Of course building a tokamak is still an incredible technological achievement, but I'd just thought I'd point this out.  
    I've mentioned this a couple times before, but "cold fusion" was hardly a fiasco.  Even if everyone agreed that the science were completely wrong, it would hardly constitute a fiasco.  The two men involved, Pons and Fleischmann were both highly accomplished in their fields, they had an interesting idea, tested it, and had some very interesting results, which they reported.  They reported it in a poor manner, and the issue quickly became clouded, but there was relatively little cost to society.  Not much money was spent on cold fusion, considering that if it works, the return on investment would be so enormous.  Certainly, billions of dollars were not spent , as in the hot fusion program, which has still to produce any net energy.  

    Secondly, many researchers have established "cold fusion" as being a perfectly real phenomena.  It was initially dismissed largely for being irreconcilable with theory, a theory for hot plasma in a vacuum, not for cold nuclear reactions in a solid.  Since theory cannot dictate to experiment, a number of experiments were done to show that "cold fusion" was illegitimate.  Most of these experiments have been shown to be faulty, and even fraudulent.  For example, the experiments at CalTech involved making measurements of heat with a calorimeter.  The students involved in making the measurements recalibrated the calorimeter each day because they were getting excess heat which they couldn't explain.  Similar actions appear to have happened with the MIT experiments, except that in this case it appears to have been intentional.  

    In any case, hundreds of researchers worldwide have replicated the phenomena, including researchers at Stanford University, Texas A and M, Wisconsin University, one of Japan's preeminent nuclear physicists, researchers in Italy, Russia, China, and India.  Unfortunately, mainstream Journals refuse to publish articles on the subject, often without reviewing them.  The U.S. Patent Office will not grant patents on the subject, and the DOE will not grant research money to researchers in this field.  Given the potential benefits associated with this technology, I think it certainly deserves a more careful look.  Check out http://en.wikipedia.org/wiki/Cold_fusion for more info.  

    There are two problems with the cold fusion evidence. First, calorimetric measurements are extremely difficult to perform accurately under the conditions of the tests. All of the sources of energy input and heat loss must be accounted for over the entire duration of the experiement. This typically leads to large uncertainties in determining the excess heat production. Second, nuclear measurements -- a sign of fission/fusion processes -- have to be done very carefully. I am an experimental nuclear physicist and I can tell you that chemists generally do not have the background to make those kinds of measurements. When the measurements have been done properly, accounting for natural background radiation, Gamma-ray and neutron by-products have not been demonstrated. In short, cold fusion appears to be a "classic case of what the Nobel chemist Irving Langmuir called 'pathological science', in which the results are always near the limit of detectability and the proponents always have an ad hoc answer as to why."
    I feel free, you are absolutely correct to point out that calorimetric experiments are quite difficult.  Cold fusion researchers have spent a great deal of time trying to perfect calorimeters in order to make better measurements to insure that their results are accurate.  Indeed, the science of calorimetry has been significantly advanced by a number of cold fusion researchers.  In fact, despite the difficulty of calorimetry, the results of Pons and Fleischmann have now been repeated hundreds of times.  In at least one experiment, the possible error in a calorimetric measurement was 1/90th of the amount of excess heat measured.  

    As to the nuclear measurements, a number of experimenters have in fact measured neutrons and gamma rays.  However, you are correct in saying that these are not typically observed.  Cold fusion is extremely different from hot fusion, and there is no reason to believe that the theory which predicts that d+d will fuse to form tritium and a neutron as well as gamma rays when deuterium is in a vacuum will hold when nuclear reactions occur in a solid.  On the other hand, at least one experimenter has demonstrated a quantitative relation between He4 measurements and heat production.  Since d+d to He4 is a pathway of hot fusion, albeit having low probability, it seems that this is the pathway most frequently chosen by cold fusion.  

    There is a great deal of misinformation about this subject on both sides.  The science of cold fusion was unfortunately  quite poorly understood when judgements about the technology were made.  It is still poorly understood, but many experiments have been done and researchers in the field have a better understanding of what might be going on.  Unfortunately, many critics of cold fusion have not paid much attention to newer research.  This makes it difficult to have an honest discussion of the technology.  Personally, I think that given the possible benefits of cold fusion, it is worth a bit of time and money to find out if it really works and can be harnessed for energy, to the tune of at least 20 to a hundred million dollars.  We are spending at least that much money on ethanol, and that may well be a net energy loser.  

    I'd appreciate if you'd check out the wiki article on cold fusion, and let me know what your thoughts on that are.  I'd also love it if some members of the oil drum would be willing to have a dialogue on this subject.  It is important.  

    "Cold fusion is extremely different from hot fusion, and there is no reason to believe that the theory which predicts that d+d will fuse to form tritium and a neutron as well as gamma rays when deuterium is in a vacuum will hold when nuclear reactions occur in a solid."

    Explain this....I don't understand why a physical state would change the outcome of a nuclear reaction if the reaction actually took place.  Once the repelling forces of the nuclei are overcome does it matter what the external temp/pressure are? I no little about fusion, so enlighten me please...


    The problem is that physics is so ridiculously complex that you need to develop a model for everything.  Thus in quantum mechanics, you make certain approximations such as the repelling force between electrons within an atom are negligible.  As long as your approximations are based on reasonable assumptions, you can get out reasonable results.  Unfortunately, if the assumptions fail to hold you can sometimes get quite different results.  For example Ohm's law holds in many metals given certain assumptions, but at very low temperatures in certain metals known as superconductors, this law falls apart.  The problem is that in condensed matter (a fancy word for things like solids and liquids) there are so many particles that you have to make lots of approximations, but there are lots of times when these approximations fail and you get quantum effects like superconductivity or superfluid helium.  Now the physics of nuclear fusion are based on the assumption that the reactions are occuring in a vacuum.  This is typically pretty valid since on the time-scales involved in a nuclear reaction, the other atoms in a plasma won't effect the nuclear reaction.  However, it may not be true in all cases.  In particular, in certain solids it may be possible for coherent effects to develop, so that various deuterium atoms are quantumly related in some way, changing the nature of the reaction.  No one understands for certain how this might occur, although there are a number of ideas.  However, similar things happen with superconductivity, superfluidity, lasers, bose-einstein condensates, etc.  In any case, the evidence for cold fusion is experimental not theoretical.  You cannot declare an experiment to be false on the basis of theoretical models, but must consider the experimental setup instead.  Theories are a guide, but they cannot dictate to experiment.  
    you will spend more energy just to get enough of that d20 then you will ever get back out by using it in fusion. that is of course assuming man made containable fusion is even possible.
    the sun only gets away with it because of it's size gives it enough gravity to keep the reaction contained.
    That is actually patently untrue.  Nuclear reactions are very different from chemical reactions.  They produce an immense amount of energy.  In a nuclear reaction mass is converted to energy, and mass has so much energy in it, mc^2, that the energy obtained in this fashion is enormous, on the order of 20 MeV per atom.  Typical chemical energy outputs are almost a factor of 10,000 smaller.  Since separating D20 from H20 involves chemical processes, far less energy is required than is eventually produced.  This in no way violates the laws of thermodynamics because the energy is being converted from one form to another (mass to heat).  Currently any number of chemical plants separate D20 from H20 for nuclear power plants.  A liter of D20 typically costs around $500.  Since that liter of D20 could probably power Manhattan for a month, this is obviously cost-effective.  There is enough energy in the heavy water in a cubic kilometer of seawater to more than equal all of the energy contained in all of the fossil fuels that we have used and all of the fossil fuels that remain in the earth.  
    You are correct. If a practical means to obtain energy from fusing deuterium atoms were found, it would lead to almost unlimited energy and the modest amount of chemical energy required to obtain the deuterium from sea water would be negligible. However, the converse is true. There is no known electro-chemical reaction at ordinary temperatures that can produce the enormous forces required to confine deuterium atoms close enough to produce fusion. Therefore, there are strong theoretical arguments against cold fusion, in addition to the nebulous experimental evidence.
    Again, I agree with you.  The theoretical basis of cold fusion is quite poorly understood.  Alan Widom of Northeastern University and Lewis Larsen have an explanation for the phenomena involving the weak interaction.  Peter Hagelstein of MIT has an explanation involving phonons and quantum correlation.  Unfortunately, I don't know enough physics to understood let alone explain either of these theories.  Some of there papers are posted at http://www.lenr-canr.org if you're interested.  

    Cold fusion is studied because experimental results have shown that heat is produced during the electrolysis of palladium and deuterium.  Since the heat will be useful, no matter what source it comes from, it is worth studying.  It is clear that cold fusion is very different from hot fusion, and may not even be a strong nuclear reaction, but rather a weak nuclear reaction.  As usual, theory must not dictate to experiment.  If the phenomenon is real, new theories must be developed to explain it.  Cold fusion does not violate any laws of physics.  It does violate the laws of hot fusion, but the theory of hot fusion is predicated on a number of assumptions including that the reactions take place in a vacuum which is clearly not the case here.  

    No, only some experimenters have claimed that excess heat is produced by such electrolysis. In almost twenty years they have not been able to convince those competent to judge that their results are replicable.
    It is true that only some experimenters have claimed excess heat, and others have found nothing.  However, there have been many replications of the effect, numbering in the hundreds by competent, successful scientists.  There are certainly quacks in this field, but some researchers studying this phenomena are highly accomplished scientists.  In particular, Martin Fleischmann was considered one of the best electrochemists in the world.  John Bockris wrote one of the classic textbooks in electrochemistry.  A theorist, Peter Hagelstein, is a top scientist in the field of laser physics and coherent effects.  Two nobel prizewinners, Brian Josephson and Julian Schwinger worked in this field.  Finally, Arthur C. Clarke, while not a researcher, wrote extensively on the subject, and was very upset with the mainstream reaction to the technology.

    There has been considerable work in this field in the last twenty years, and much of the controversy has been cleared up, at least for those who are familiar with the latest research.  Unfortunately, many scientists who are critical of the field refuse to familiarize with newer experiments.  Mainstream scientific publications refuse to publish articles on the subject, and the patent office refuses to grant patents.  All of this makes it very difficult for the field to advance.  

    One major problem is that it is difficult to get reproducibility in experiments.  Many experiments have been replicated many times, but not in every case.  Similar results were obtained during the development of the transistor.  Most likely, the material composition of palladium has a great deal of influence on the phenomenon, and the presence or absence of a few doping ions can dramatically change the results.  Until researchers in the field can resolve this problem, it will be difficult to harness energy from this technology.  However, the evidence in support of this phenomenon is by now extensive, and can be found at http://www.lenr-canr.org.  It has been replicated too many times to be dismissed, especially the research by careful researchers.  

    Very interesting discussion about something that I know next to nothing about....

    If we are going to spend $500+ BILLION a year on the military machine here in the US, I don't see any harm in throwing, say, $500 MILLION a year at cold fusion research - sort of with the spirit with which one might purchase a one-dollar lottery ticket for the mega-millions sweepstakes.

    Plus, it would create jobs for otherwise perhaps unemployable people with technical backgrounds....

    My thoughts exactly.  We're spending loads of money on all sorts of mostly useless things, such as highway projects, the military, suburbia, etc.  Why not spend some peanuts on something that might help, even if its very unlikely.  
    Regarding China, there's  a new analysis from the Congressional Budget Office (CBO) called "China's Growing Demand for Oil and Its Impact on U.S. Petroleum Markets,"
    April 2006.  Haven't had time to read it yet meself.  Link: http://www.cbo.gov/ftpdocs/71xx/doc7128/04-07-ChinaOil.pdf.
    Hi Bob,
    Even in Wet Western Oregon there is water trouble on the horizon. Too may people.


    Hello ET,

    Thxs for the info!  I think people take water for granted much more than they take fossil fuels for granted.  People experience short term electrical blackouts from weather events [expecting the power to be shortly restored], and are use to refilling their gastanks for higher costs, but people very rarely have no water come out their kitchen or shower taps.  It will be a rude awakening for most when this starts occurring.

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

    Hello TODers,

    Thxs for the replies, but is TOD going to send some kind of formal email to the G8 Conference next month? I hope we will--that is what the G8 opinion forum webpage is asking for:


    I feel it is our moral duty as the leading peakoil forum to put our two cents in.  Perhaps the G8 leaders will include our email in their press releases which will be followed by the worldwide MSM.  Time is awasting!

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

    More good news... (Not...)

    RTS bourse to start trading oil, oil products, gold on June 8

    Snipped from article...

    MOSCOW, May 22 (RIA Novosti) - The Russian Trading System, Russia's premier stock market, announced Monday that it would start trading in gold, oil and oil products on June 8.

    Thoughts on where the dollar will head?

    Ummm - wait, wait, I know this one.......
    To be more specific, I've seen the IOB refered to here on TOD as the "Iranian Oil Bore", and I've waffled back and forth on how improtant I think it would be.  But, if a group of large exporters start trading in currencies other than USD, I think the argument that it doesn't matter because it's all convertable to other currencies starts to sound a bit hollow.  
    Don't be surprised when Hugo announces a Venezuelan oil bourse. That'll annoy BCR a little! If other boursers go with the Euro, so will Hugo.
    Feel free to insert Russia or Venezuela in place of Iran in the phrase. I maintain my prediction that none of them will ever take off.

    The power of a currency as a medium of exchange lies in the willingness of creditors to hold it for long periods of time and to agree to use it as a medium of exchange.

    A price is only a way of measuring something. The dollar price claim is the equivalent of saying that if we bought commodities in kilograms rather than pounds, it would doom the US.

    Russia has enough market power to insist that buyers convert their currency prior to making energy purchases, but this doesn't make any difference. No one is going to hold large sums of Russian, Iranian or Venezuelan currency in order to make oil purchases. It wouldn't help them and would create a massive currency risk.

    Likewise, these countries are still going to convert currencies back to arrive at their predetermined holding arrangement in any case.

    Disclaimer: This does not mean that I think the dollar is unassailable. I do think there are real risks to dollar primacy. If countries begin to perceive that that risk return profile of the dollar is unfavorable, or if it becomes less important to maintain a weak currency against the dollar, they will abandon it.

    The various bourse schemes get thrown around only because it is so tempting for many to envision an Achilles heal for the dollar, not because there is any substance to the threat.

    I think that's incorrect: the rate of exchange between pounds and kilograms is fixed, while the rate of exchange between dollar and other currencies is a matter of opinion, especially since it's fiat money.

    If all oil exporters switched to their own currencies, it would indeed pose less of a danger to the dollar, since there would be no clear alternative currency - though you could expect the price of gold in dollars to rise even faster. If they all switched to the same, preferably stable, currency, there would be an alternative. For your information, the primary task of the ECB is to contain inflation.

    Jack: At least some of them will. The Euro fits your description of a currency. Your kilos argument is nonsensical.
    Why is it nonsensical? Maybe you're missing the point.
    I'm asking you to elaborate. Why is it nonsensical?
    A dramatic drop in value of the US currency would have the same effect on the US economy as switching to the metric system. Elaborate.
    Yeah, you definitely missed the point.

    Jack was using kilograms and pounds as an analogy for two things being basically the same thing, not a conversion to the metric system.

    Oil is traded in dollars. The dollar is the stable, powerful currency in the world. At this point it doesn't matter what you "call" what you are doing, you are still operating in a dollar-for-oil, dollar-is-king-world.

    Okay. Now you are talking nonsense. Congratulations.
    Elaborate. Please.
    "A dramatic drop in value of the US currency would have the same effect on the US economy as switching to the metric system."

    Where, other than your comment, in this discussion do you see these words? Neither Jack nor myself has mentioned them, so who exactly are you talking to?

    Russia is the only country wanting to do this in THEIR money.  I know for a fact that following the post cold war, dollars became the norm for dealing in business.  You can't walk down a street in Moscow without running into fifty (hyperbole) exchange windows.

    Now, Russia wants to demand payment in Rubels.  However Iran is proposing accepting the Euro.  Now I know the arguments against the fundamentals of Europe as a whole and why it won't work, but follow me.

    I've read about how sandpiles turn into avalanches.  It's rather fascinating beacause what they found was ONE grain has the same chances of bringing down the entire sandpile.  It takes millions of grains of sands to form the piles, but there are regions within the center of the pile that become unstable.  As more instability builds up, the next grain can bring it all down.

    They found that there is no number that brings down a sandpile.  Take this and apply it to the current oil bourse question.  At some point, if Iran (3rd largest reserves?) says we want Euro's only there will be another country to jump on the European bandwagon.  How many countries need to band together and start trading more and more in Euro's to undermine the dollar?  I don't know, but as more and more countries adopt this approach, it becomes increasingly better especially considering the relative strength of the Euro against the dollar.

    Now the Euro's fundamentals & social disagreements are a problem, but relatively speaking they are no worse than us.  In the face a collapsing America, do you think Europe will fight amongst themselves or band together?

    Sounds like what I said about boursers. One country boursing may or may not destabilise things. But enough exporters boursing will screw the dollar. So far, Iran wants to bourse, and Russia and Venezuela are thinking about it.

    It turns out before the war Iraq tried to bourse and take euros. Sone conspiracy theorists contend that the attempted boursing was why the war was started. Now, becuse we are bogged down in a quagmire, any bourser can step up to the plate! Worse, if we attack Russia or Venezuela, we at a minimum only create a new species of anti-American terrorists.

    Add me to the nut list then b/c if you really don't think we are in IRAQ for oil I call BS.  While I don't think the Euro/Oil/Iraq was the reason we went after him, I certainly don't think it helped.  It was like 2 months later that we started shock and awe.  Not much time to see how things would progress.
    I'm not sold on either side of this argument yet.  But I'm not sure I'm buying that currencies are no different than measuring systems.  If that were true, wouldn't all currencies be the same (i.e. translation is free, just multiply by K)?  Or is the argument that there are differences between them, but the demomination of a particular transaction doesn't affect that relationship?  It would seem to me if the transactions were large enouogh (whatever that means) then they would start to affect the relationship.
    There will not be a noticeable impact on the dollar in the short term.  There has to be a mass movement away from the dollar for there to be a collapse in its value.  The current US regime is paranoid about this cascade effect.  But I don't see it happening, yet.
    Nor do I see it happening so soon but you take:

    How long before others follow suit?

    OPEC - Oil Dollars or Oil Euros?

    Keep putting nails in the coffin, sooner or later you will be burried. -- Peace, Love and Soul my brotha...

    One bourser doesn't do much, but if most of the exporters bourse, the dollar tanks. Even worse is if all the boursers pick the euro. (or all agree on one currency) Now, with Iran and Russia being possible boursers and Hugo liking to annoy BCR, that leaves Saudi Arabia to become a fourth bourser at some point.

    Global oil bourse, anyone?

    E. Wesley F. Peterson, a professor of Agricultural Economics at the University of Nebraska submitted an editorial to the Lincoln Journal Star today, titled "Let's be smart with our petroleum".  I can't link it, but I'll give you a few excerpts.

    ...it could be argued that the United States actually is not dependent enough on foreign oil supplies.  Instead of pumping oil out of the ground in one place so it can be pumped back into the ground at the SPR sites, wouldn't we be better off simply leaving U.S. petroleum in the ground while we help to use up everyone else's oil?
       ...  In 2006, U.S. known reserves stood at 21 billion barrels.
       Note that while this represents only 1.6 percent of world reserves, it is a much larger stock than we are holding in the SPR.  In fact, if the U.S. simply left all of the petroleum under U.S. territory in the ground, it would constitute a strategic petroleum reserve containing almost three years of consumption in contrast to the one month of consumption that would be available from the SPR as currently structured.  There are undoubtedly some technical problems with the idea of capping U.S. wells in order to save petroleum from U.S. sources, but if such a strategy is feasible, it makes more sense than to incur the costs of transferring oil from a U.S. or foreign well to the SPR salt domes in Louisiana or Texas where it is stored.
       Some may object that importing 100 percent of U.S. oil consumption would leave us vulnerable to disruptions in the foreign supplies.  But we would have three years worth of consumption left in the ground and that should be enough to get the country through any short-term disruption that might arise.  The world will never run completely out of petroleum because as it becomes scarcer and more difficult to recover, its price will increase to the point where it is no longer economically sensible to use it.  Meanwhile, we would be better off using oil from other countries, saving ours for a real emergency should one ever arise.

    Many countries may be starting to consider this as their strategy.

    I don't understand how remaining US oil reserves can be used as a SPR, to cover a period of three years: are you saying that ALL of the oil within the US can be consumed within a period of three years?
    The reason oil is pumped into SPR's is because it is easily reclaimable through simple infrastructure, wheras oil located naturally in the ground cannot all be consumed, and must be drilled for etc. An overlooked point?

    I also don't see how ALL American oil production can be taken offline - what a jump in price that would create! Sure, the main SPRs wouldn't be filled, but worldwide supply wouldn't cope with such a change in policy. This article assumes there is such supply at-the-ready, to supply 100% of American needs for years, through imports.

    There are so many holes in this suggestion, I find it hard to believe it is from a professional. It hardly takes into account modern economics of oil, let alone peak oil.

    I agree.  I just thought it would make for interesting discussion.  One thing that jumped out at me about the story is that here we have an Agricultural Economics professor that may be fearing for our food supply and he is grasping at straws as a way to prevent disruptions for a period of time, though his knowledge of the oil world itself, is limited.  Also, that many people of many different walks of life may be starting to absorb this story and perhaps panic or come up with their own unique solution.  
    CNBC "On The Money" today @ 7PM Eastern time will be discussing ethanol (I believe).
    I believe the show is called "The Ugly Truth about Ethanol"
    Drudge Falsely Smears Gore

    Matt Drudge is looking for any excuse to smear Al Gore and his new movie, An Inconvenient Truth. He's been running this story, unsourced, all day:

    ThinkProgress contacted Gore's representatives, who unequivocally confirmed that Al Gore and his associates walked from the Majestic Hotel to the screening at Cannes. Further, Paramount has committed to making the entire tour promoting the film carbon neutral.

    UPDATE: At 3:37:59 PM EST, an hour after this post, Drudge removed his smear on Gore.

    BTW, I read that McLeod article about TOD being the place for "traditionalist" peak oilers.  I gather it is a dig, but I frankly don't understand what "traditionalist" means in this context.


    We are dull boring scientific & engineering types who spend WAY too much time talking about #s and what they mean.  That is just *N*O*T* hip !
    It may not be HIP but at least we don't blindly post / comment on data without having some numbers to back it up :)  (I know you were making phun... because you are HIP) LOL
    I disagree with his conclusion. A short white guy from any country (not just Canada) being named the MVP of the NBA two years in a row is a big story (at least it is unusual).
    I don't think any group comes out too good in his personality sketches.  Did you catch him say:

    Curmudgeons are often very number savvy but as a result they avoid any topic they have trouble quantifying because it's too much work. They likely point out the shortfalls of the technology they know the most about, and promote the technologies they know the least about due to their cynical worldview. This group includes me.

    I think it the whole thing is part true and part good fun ... but (LOL) maybe that's because I've got a bit of the curmudgeon in my view ;-)

    India on alert for suicides after stocks slide
    Mon May 22, 2006 10:11 AM ET


    MUMBAI (Reuters) - Indian police are watching out for possible suicides by brokers and investors after a steep market slide wiped out billions of dollars in share values, officials said Monday.

    Policemen were keeping a watch near lakes and canals, possible places where people in distress could head to kill themselves. They said rescue teams were on alert.

    "A financial crisis can trigger suicides. We are just trying to prevent them. Till now, no such cases have been reported," said R.K. Patel, a police official in the western city of Ahmedabad.

    India's Bombay Stock Exchange Ltd., which had a market value of $657 billion last week after falling 10 percent in the previous two sessions, slid as much as another 10 percent in early trade Monday following sales of stocks held by brokers as security on behalf of their clients.

    "Gold has turned into brass. We are finished," said S.S. Gupta, a middle-aged Mumbai broker who said he had lost millions of rupees in two hours of trading Monday morning.

    Ahmedabad is considered particularly vulnerable to stock market volatility.

    With over five million retail investors, the city is one of India's main trading hubs where people have put in millions of dollars of their disposable income into the stock market.

    "I borrowed money to trade in the market. I lost it all in the past two days," said 37-year-old Sanjay Joshi, a small investor. "I don't know how will I repay my loans."

    In the 1990s, a stock market meltdown led to several bankrupt brokers and small investors committing suicide across India, some of them drowning in rivers or throwing themselves off highrises.

    Analysts described the market slide -- which has been as much as 22.4 percent from an all-time high of 12,671.11 points on May 11 -- as a correction and said order should return soon.

    "It seems overdone and the market should stabilize during the second half of this week," said Rajat Jain, Chief Investment Officer, Principal Asset Management Company Pvt Ltd.


    © Reuters 2006. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.

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    Ethanal futures:  ACM6 $3.14/gallon
    Gasoline futures: HUM6 $2.07/gallon

    Ethanol   84,400 BTU/Gallon
    Gasoline 125,000 BTU/Gallon

    Implied EROEI = 0.44

    Sounds about right.

    Guess who has arrived to argue that global warming is real.

    The insurance companies.  Australia is first up.

    "INSURANCE products linked to climate change may be introduced in Australia.

    "Bruce Thomas, a sustainability expert with reinsurer Swiss Re, told The Age he expected Australia to follow other countries where insurance had taken account of the effects of global warming."

    http://www.theage.com.au/news/business/insurers-take-cover-with-global-warming-risks/2006/05/22/1148 150186764.html
    The Oil Drum was mentioned in Newsweek magazine, May 1st issue, page 16, at the bottom of the page, under "blogwatch".
    On a seperate note: Businessweek has an interesting article on the May 15th issue titled "Why you should worry about BIG OIL". it made for a good read, but then after reading TOD over the months, I'd say that I wasn't surprized my the article's depth. Yet it reinforced my opinion of TOD, absolute "cutting edge" information. Thanks to all!
    I had to sit in a Dr's office waiting room for an hour and a half today - I picked up the only magazine there that looked interesting, a copy of the May 2006 "Outside Magazine".  As I'm flipping through, I run into a whole article on Peak Oil with Kunstler and our own Westexas!  I was amazed!  
    As I said in a previous post, you haven't lived until you have driven Jim Kunstler around a suburban wasteland as he delivers a stream of conciousness profanity laced running commentary on suburbia.

    We have fast growing, but small, pockets of New Urbanism here in the Dallas area, but they are little islands in an ocean of suburbia.  

    Found this interesting site:


    Attacks on Iraqi pipelines, oil installations, and oil personnel.

    It lists them all, starting with June 2003. The latest is May 15 - attack on pipeline in the Daura refinery.

    It also has a good map of the pipelines and facilities (scroll down to the end to see it).

    Yet another "expert analysis" by someone who doesn't get it:

    The 'peak oil' deja vu
    By Bob Hoye


    someone with a frontal right brain injury wouldn't understand the article provided in this link. Again an example of modern corporate-political rhetoric.

    1 - there is no oil problem
    2 - cycles take care of everything
    3 - we will move on to coal which is still abundantly lying in the earth waiting to be extracted

    Of course if you read this in a mirror it means :

    1 - we are at the beginning of an oil problem
    2 - cycles exist, with successive expansion-contraction phases implying our system is on the verge of exploding
    3 - we will delay the huge explosion some years by moving back to coal from which we will try to extract every remaining cc, regardless of the problems which made us switch from coal to oil in the first place.

    Here is some depressing news though I suspect it is a blip until Congress gets moving again:




    From the latter,

    DTE Energy Corp. suspended production at all nine of its synthetic fuel plants this week because rising oil prices made the manufacturing of the alternative fuel too expensive.

    Michigan's biggest power producer said it couldn't afford to make synthetic fuel at a time when energy prices are going through the roof, unless it was subsidized. Oil prices are too high for companies to qualify for a federal subsidy.

    The nine facilities, in Kentucky, Alabama and West Virginia, employ a total of 150 workers whose jobs are at risk, say DTE officials.

    DTE has a majority stake in two of the facilities and maintains minority positions in the remaining seven. Synfuel, as it is commonly known, is liquid processed from coal that allows companies like DTE to earn federal tax credits under Internal Revenue Service rules by selling it. The market for the fuel is generally limited to such industrial customers as steel producers that can use the coal substitute to generate electricity.

    "Right now, the sale price for the processed coal is less than the cost of producing it," said Mike McNalley, director of investor relations for DTE. "The price of oil has reached a level where the tax credit is phased out. It's gotten so high, that it would be unlikely to come down enough to merit" synfuel "production at least for several weeks."