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Friday, December 09, 2005

185. SHOULD WE MITIGATE EARLY BECAUSE THE MARKET IS MYOPIC?

In the comments we were discussing early mitigation. Anon wrote:
Roland, from your remarks I assume you live in the inner urban area of Sydney? Do you think that the scenario you describe will be practical for the satellite areas of Sydney... say western suburbs, central coast etc.? Many people live in areas where walking to shops etc. is not possible. [...]

I believe that a serious campaign must be launched immediately in Sydney to extend and consolidate public transport based on PO awareness. We can drop the doom histrionics and stick with the certain transport crisis, this is exactly the message Kjell Akelett described to me over a beer here in Sydney a couple of weekends ago. I also agree with Bob Hirsch, measures must be implemented BEFORE peak, a market based solution will be devastating.
To this I replied:
anon, there is a risk here that Hirsch himself points out -- the risk of mitigating too early (see 2. and 15. in Appendix VI of the Hirsch report). For example, what if you build a new mass transit system to service the outskirts of Sydney, but nobody uses it for years and years because the price of oil doesn't rise enough to justify switching? It's the risk of wasting a big pile of money (private or public) on a fiasco people won't use. That's what happened with Jimmy Carter's "synfuels" program in the 70s and 80s. It turned out to be a porkfest where the oil companies burned through billions of dollars of taxpayer money and produced nothing of any value.
I think people are still greatly underestimating the main risk of early mitigation: unrestrained pork. For example, consider this ironic development:
In Spain, Manuel Perez Becerra, secretary general of the Andalusian Beet Growers' Association, said that with current technology more energy is required to produce a litre of alcohol from beet than can be extracted from it once made.

Without tax breaks or subsidies of some sort it will not be viable to produce ethanol from sugar beet, he added.Source
What Mr. Becerra is saying is this: the EROEI of beet sugar ethanol is less than 1, therefore his industry needs taxpayer money. Clearly this is peak oil heresy of the rankest sort. If a process returns less energy than it consumes, then (according to peak oil theory) it shouldn't be done at all, let alone be subsidized by the government. But the funny part is that Mr. Becerra will fight back with peak oil theory. We can't wait for the market to act because it will be too late. We need to start mitigating the inevitable liquid fuels crisis now. That's why my industry needs your tax money. Better safe than sorry.

The problem is this: If you step outside the market framework, you are talking about a big pile of taxpayer money, and all the snake oil salemen and subsidy feeders lining up to get a piece. Who get's the money? The corn ethanol lobby? The beet lobby? The coal lobby? The refining lobby?

You could argue that refiners aren't investing to expand refinery capacity because they're all waiting for a handout. All they have to do is sit on their butts, watch rising gas prices put the squeeze on, and keep stressing that they really can't get the job done without assistance from the government:
Bob Slaughter, the president of the National Petrochemical and Refiners Association, told a House committee last week that Congress could expand tax incentives included in the energy bill as a way to encourage growth of the refining industry.Source
If the government is going to provide the funds because the market is too myopic, who will decide which projects get the funds? And how will they decide? I'd be interested in hearing serious answers to those questions.
-- by JD

33 Comments:

At Friday, December 9, 2005 at 10:31:00 PM PST, Anonymous Anonymous said...

"What Mr. Becerra is saying is this: the EROEI of beet sugar ethanol is less than 1, therefore his industry needs taxpayer money. Clearly this is peak oil heresy of the rankest sort."

I don't think that this doomsaying is a postive turn of events. And suggesting that the BIG GOVERNEMTN can bail us out is an insult. I think that beets are here to stay.

 
At Friday, December 9, 2005 at 10:32:00 PM PST, Anonymous Anonymous said...

I don't agree. EROEI is not a measure of inherent beet energy. There are probably several memes that would reduce this input into its constituent components and prove once and for all that the resulting output is positive.

 
At Friday, December 9, 2005 at 10:49:00 PM PST, Blogger dub_scratch said...

Perhaps the problem is not with the idea of doing an early mitigation. We definitely need to prepare early with a cooperative approach between government & business. And since nobody knows when oil will peak, it is a good assumption that we are within the range not preparing too early.

But what you should emphisize here is more on the type of mitigation. I particularly don't like the emphasis on alternative liquid fuels, which tends to be the focus by people who look at this. All of the supply side approaches are expensive and run the risk of wasting huge amounts of tax payer money. Plus, when the legislative branch gets into the act of doling out money, a thousand special interests lobbies will be there to try to steer where the money goes. I think there is pretty good reason not to trust that congress will appropriate the funds wisely.

And what are we funding with our tax money anyway? Am I going to be taxed to support coal-to-liquid fuels for the use of car drivers-- people who waste energy in huge quantities?

No, the early mitigation should be more focused on the demand side, particular by diminishing the the high levels of automobile dependency here in the US. We need to reverse the laws and subsidies for cars & highways. I would like to see a ban on the nationwide pro-car policy of municipal parking requirements (the "build a parking lot or go to jail" policy). I'd like to see fuel tax revenue directed away from the support the building of more highways. I'd like to see the end of zoning and other car oriented land-use rules. All that I mentioned above will cost almost no tax money and will go a long way at preparing our nation for PO when it comes.

One thing that should be clear is that Americas addiction to cars is the primary reason why our per-capita consumption is double that of Europe & Japan. It also needs to be more understood that car consumption will not last long without incurring huge costs and risks. The sooner we in the US acknowledge this and act accordingly the less we will need some coal-to-liquid fuels program to be rushed to the market.

 
At Saturday, December 10, 2005 at 3:49:00 AM PST, Blogger Roland said...

I agree with Chris L that we need to be looking at mitigation strategies that will benefit us whatever the price of oil is, such as tightening fuel economy restrictions and implementing urban planning and transport policies to make living without a car easier. I think that if it's truly easier and more pleasant to get somewhere by mass transit, walking or pedal power, people will choose that option no matter what the price of oil.

These strategies create jobs, their success doesn't depend on the price of oil and their side effect is helping the environment and making cities more liveable. With imagination and effort, any city, no matter how choked and sprawling, can be transformed by this method - just look at Brazil's Curitiba. Wildwell said it best: "there is no reason why a sensible urban planning and transport policy couldn't solve peak oil".

Secondly, there are some supply-side solutions in which I think the cost-benefit analysis justifies an immediate fuel substitution program, ie food production and transportation. It's one thing subsidizing synfuels for SUVs and quite another subsidizing them for something as vital as the food supply. Perhaps we should also look at shifting to coal as a fertilizer feedstock.

For food transport, I like the idea of trains for long distances and in the inner city, vans running on biodiesel natural gas, liquefied coal or even electricity. Freight trains, like a good urban planning policy, make sense no matter what the price of oil.

So I think the answer is a huge effort to reduce demand and, considering the Peak is more likely going to be sooner rather than later, a gradual program informed by careful cost-benefit analysis to substitute for oil in its most essential uses. If markets prove conducive, then these alternative fuel programs can grow to provide for other uses, like driving around town in a pimped-up hummer flashing your boobs at strangers.

 
At Saturday, December 10, 2005 at 3:54:00 AM PST, Blogger Roland said...

Can I just add, I don't think the NSW state government would be to concerned about building a public transport system that nobody uses, considering that they're currently spending billions of dollars on massive motorways and tunnles that nobody drives in. It's just a minor shift of direction from one unused infrastructure to another. :-)

 
At Saturday, December 10, 2005 at 6:21:00 AM PST, Anonymous Anonymous said...

I agree with everything above. I think more time needs to be spent discussing political tactics i.e. how can the current system be manipulated to make some of these things happen. There is a little bit of this out there already. We should be focussing on creating a drumbeat focussed on one idea - energy security. The Bush propaganda machine on terrorism and Iraq will help this. The daily news cycle of suicide bombings will support it. Why are you placing your future in the hands of the Saudi royal family? What happens if a Bin Laden clone stages a coup? The only way to get the masses to move is through fear, that's why Bush used WMD has his primary propaganda.

It's fine to say we need to change zoning laws and stop supporting the highway system. You have zero chance of accomplishing this against the rich entrenched interesting protecting these subsidies and programs. We need a realistic strategy.

By the way, I think the most immediate need is for a gas tax which pegs gas at say $3 a gallon, independent of market fluctuations (works as long as market price stays under $3 dollars).

If peak oilers want to be effective they have to organize and focus. I say focus on an energy security scare campaign for an increased gasoline tax.

 
At Saturday, December 10, 2005 at 9:28:00 AM PST, Blogger Chris said...

Cheers, Chris L. I couldn't have put it better myself. While I think it's important to deal with both supply and demand sides of the energy equation, I think that a disproportionate amount of effort and money has been devoted to the former. It seems to be that there are lots of relatively easy ways to drastically reduce demand, while increasing supply is quite difficult. Unfortunately, this comes down to who is being considered in the decision making process: it's big business, and big business can't easily benefit from decreased demand as easily as they can from increased supply.

 
At Saturday, December 10, 2005 at 9:29:00 AM PST, Anonymous Anonymous said...

What if they decided to unsubsidize gas in the US, take the tax component out (so we pay less taxes) and put the full brunt of the externalities of gasoline into the price per gallon?

Meh I'm just thinking, I think 3 things need to be done when facing the peak oil issue.

1 - PERSONAL conservation: This is not pointless, you save money, get more excercise, and generally feel like a better person (whether or not it's warrented). All things considered if you can figure out how to live without your car (this doesn't mean you have to stop using it for the odd long trip etc, just figure out how to get down the essentials of your life without it, eg getting groceries, going to work, etc) you will do no worse than 99% of the rest of your country when peak finally arrives. Whether or not it will mean you get to keep your job while the entire economic system crumbles and people start eating each other is another matter best left to psychic phone line operators and conspiracy theorists.

1 - OTHER PEOPLE'S CONSERVATION: encourage your neighbors to conserve, I laugh when my neighbors complain about high NG costs when they waste it so readily. Inform them what you do differently. You won't save the world, but you're neighbors will appreciate it. Write your congressman about the issue, don't cite LATOC or they'll end up spewing a bunch of bad "facts" (such as the precious metal requirement of a hydrogen fuel cell requiring all the platinum on earth, or the suggestion that oil = food, when NG is used for fertilizer and coal can be). I'd send them the Hirsh report and a few other sources, still negative but negativity will spur action hopefully?

3 - MITIGATION: You can't do anything about this, showing your support by riding the bus is about all you can do as well as including mitigation techniques in your letter to your congressman. We won't see any serious mitigation until the first few oil shocks, whether that is good or bad is going to be up to history.

 
At Saturday, December 10, 2005 at 9:30:00 AM PST, Anonymous Anonymous said...

this thing needs an edit button

 
At Saturday, December 10, 2005 at 10:31:00 AM PST, Anonymous Fernando said...

Well, some people think France is better prepared for PO because its nuclear power.

Nuclear power in France was started by and belongs to the French State.

I fact, which company would start to build a nuclear plant if the government didn´t back up its efforts?

 
At Saturday, December 10, 2005 at 10:34:00 AM PST, Blogger dub_scratch said...

I'd like to emphasize why the Hursh is bad and why it is good:

The big problem is it is based on satisfying conditions of business-as-usual. All three scenarios are heavy on the supply side liquid fuels as a means for mitigation. On reading these strategies I could not help but think of what they were trying to maintain. Are we going to solve the problem of PO by maintaining traffic jams and car crashes? Their work shows that starting too late shows a great discontinuity in that objective. Starting too early on the supply side strategy means potentially wasting huge amounts of money and resources.

The good of the Hursh report is that it demonstrates why the heavy supply side mitigation strategy is of huge risk no matter when we start it. This is why, as this topic and debate emerges, we need to get people to focus much more on demand reduction as a mitigation strategy. The Hursh report is useful in making the case for drastic demand reductions and not relying so much on alternative fuels to maintain the national traffic jam.

 
At Saturday, December 10, 2005 at 11:20:00 AM PST, Anonymous Anonymous said...

"SHOULD WE MITIGATE EARLY BECAUSE THE MARKET IS MYOPIC?"

Ha ha ha. According to the Hirsh report (commissioned and paid for by your Department of Energy) we are too late. This type of doomeristic meme is sickening. I just wonder whatever happened to an open marketplace of free ideas in a healthy economic paradign of positive feedback? There is no way in hell that we need Aunt Fuddie Sammie meddling in our business! Just as soon as the oil runs out all sorts of imaginative enterprises will spring up and come to bat that will make the future as exciting as yesterday

 
At Saturday, December 10, 2005 at 2:00:00 PM PST, Blogger Roland said...

I agree that the market has a lot of power to fix Peak Oil, but with the huge scale of oil use it's going to take time to compensate for the lost production. That meantime is what Hirsch is worried about. I think it's worth building a few coal liquefaction/biofuel/coal fertilizer plants today and ensuring their output is only used for the food supply, just because food is so vital. Then at least people can eat while the market is finding a solution.

Also, if you don't want the government to subsidize alternative fuels, at least get them to remove the current "perverse subsidies" on petrol, cars, roads and so forth. While I agree that subsidizing synthetic fuel to maintain the status quo of automobile use is ridiculous, renewable energies are deserving of subsidies since that's where everything has to go eventually. In Australia, fossil fuels get subsidized to the tune of $8 billion a year, while renewables get much less; we should reverse this situation.

Anonymous at 9:29, I agree with you about personal conservation. As far as I interpret Jevons Paradox, it doesn't mean conservation will make things worse, it just says it won't make a difference (at least as long as resources are plentiful). That's why JD is right about conservation making sense as a personal choice. Who cares about some stupid paradox when you are making money. I would add to this two other merits of personal conservation:

1. Morality/ethics. If you're really worried about the state of the world, then you have a moral obligation to avoid contributing to its problems. Don't whinge about global warming; switch to green power and plant trees to offset your car use. Stop going on about the wastefulness of consumer culture and buy a compost bin, and so on. "Oh you can't do that, because prices will stay low and someone else will be more wasteful," say the doomers, to which I say, "I don't give a stuff." I don't care about what anyone else does. I personally don't want to contribute to problems, whether or not someone else will.

2. Ease of transition. As JD says, conservation will save you money today, but I would extend this further, because it's also going to make life a lot easier after oil gets more expensive. Everyone will have to make adjustments after Peak Oil, so the wise route is to make them now. I'm not talking about running for the hills, but if you are used to using a lot of oil, why not wean yourself off gradually while you have the chance instead of waiting for the market to do it for you? By mitigating your own demand, you can be a microcosm of what you would like the country to do.

 
At Saturday, December 10, 2005 at 2:14:00 PM PST, Blogger Roland said...

I just remembered a quote by Gandhi which pretty much sums it up: "We must be the change we would like to see in the world."

 
At Sunday, December 11, 2005 at 4:53:00 AM PST, Anonymous Anonymous said...

I was the original anon that inspired this subject...

Robert L. Hirsch actually had this to say on the subject: "It is possible that peaking may not occur for a decade or more, but it is also possible that peaking may be occurring right now. We will not know for certain until after the fact. The world is thus faced with a daunting risk management problem. On the one hand, if peaking is decades away, massive mitigation initiated soon would be premature. On the other hand, if peaking is imminent, failure to quickly initiate mitigation will impose large nearterm economic and social costs on the world. The two risks are asymmetric:
• Mitigation initiated prematurely would result in a relatively modest misallocation of resources.
• Failure to initiate timely mitigation with an appropriate lead-time is certain to result in very severe economic consequences."

JD, can you elaborate on why you think this is incorrect?

The tools to implement and then market public transport infrastructure are waiting...

Chris L, when somebody such as Mr Hirsch has to prepare a report on such a contentious subject as peak oil, the politics of the situation will necessitate a very careful "establishment" friendly framework... ya catchin' my drift... I'll give you another example, take a look at the way the IEA shifted its position on peak oil recently. They went from a "she'll be right mate" standing to one that admitted peak oil, BUT they chose a timeline scenario that leaves the problem outside of the political timespan of current bureaucrats and elected officals. I'm guessing Hirsch et al. had political concerns on mind when they were preparing the report. The oil and motor industry lobbies spring to mind...

 
At Sunday, December 11, 2005 at 6:35:00 AM PST, Anonymous Anonymous said...

Address it for the interim within the context of a hedging stategy. For example, energy utilities buying land for perspective future nuclear plants. Don't build the plant, but take care of the siting, certification, NIMBY, etc. issues a priori. The point is to maintain as much flexibility as possible. How much? That depends on an analysis of the possible future scenario and their potential costs/payoffs. This is the Real Options paradigm and it is gaining ground in system/policy design.

 
At Sunday, December 11, 2005 at 1:36:00 PM PST, Anonymous Anonymous said...

Peaking will happen within the next 80 years and not before. Revolutionary progress just announced reveals that the supply side will be augmented by brand new technology. Those neglected over-viscous residual oil fields will be harvested after all, those shale oil and oil sands reserves will be harvested efficiently and ecologically after all. This is very bad news for doomerheads but the world is not made for them.

 
At Sunday, December 11, 2005 at 1:51:00 PM PST, Anonymous Anonymous said...

Long before 80 years we will kneed those regulated over-viscious resident oil fields to be harvested but won't be able to because of BIG GOVERNMENT on our backs. Then we can grow and harvest shale oil and oil sands trees as much as we need for things to be just fine, thankyou.

 
At Sunday, December 11, 2005 at 4:21:00 PM PST, Anonymous Anonymous said...

" Those neglected over-viscous residual oil fields will be harvested after all, those shale oil and oil sands reserves will be harvested efficiently and ecologically after all."

Absolute unmitigated rubbish. The problem of peaking is that NEW fields must be constantly brought online to OFFSET depletion in existing fields that are post peak. It is a very simple concept yet surprisingly few people really get it.

What is this 'revolutionary progress' in technology...
if you're talking about the new in-situ processes, you're dreaming. Even the most optimistic forecasts for these technologies show they will not produce enough oil to offset even current depletion rates (around 4mbd, I believe).

Oil sands, oil shale are extremely dubious mitigation strategies. The price of recovering fuel from these sources will rise with the price of oil and NG. EOR (enhanced oil recovery) will not effect the timing of the world peak, It is a post peak mitigation strategy because it does not prevent falling production, it just extends the ultimate that can be recovered.

Type III depletion can only be counteracted by NEW OIL REGIONS. We are not finding them!

Note: the previous is in no way meant to be advocating doomerish sentiment or hysterical chickenlittleism.

 
At Sunday, December 11, 2005 at 5:23:00 PM PST, Blogger JD said...

The two risks are asymmetric:
• Mitigation initiated prematurely would result in a relatively modest misallocation of resources.
• Failure to initiate timely mitigation with an appropriate lead-time is certain to result in very severe economic consequences."

JD, can you elaborate on why you think this is incorrect?


The problem is not whether the point is correct or incorrect. The problem is that, if we assume Hirsch is correct, then you are giving a blank check to entrenched pork interests.

For example, Mr. Becerra will surely love Hirsch's argument: Providing subsidies to the beet industry will, at worst, be a minor misallocation of funds, and is certainly preferable to not providing those subsidies because the risks of not helping the beet industry are so much greater.

Chris L paints a good picture of where subsidies should go, but I am damn sure that that's not where they are going to go. They are going to go to people like Mr. Becerra. So isn't it more productive to oppose Hirsch's logic? At least that way my tax money won't go to propping up the automobile culture which I don't participate in.

IMO, severe economic dislocations are part of the solution. If you agree with Hirsch that severe economic problems must be avoided at all costs, then you're playing into the hands of the status quo. We have to continue car culture because the economy is dependent on it. We have to drill ANWR (for example) because the economy demands it etc.

I think oil dependence is an addiction, and there is no way we are going to kick it without withdrawal symptoms. If avoiding pain is the top priority, quitting is impossible. Economic dislocations are something we should welcome -- as the first step toward healing. It's a little like the last tree on Easter Island. Should we cut it down? Well, we pretty much have to if we want to avoid severe economic consequences, because the economy of the island is based on Moai, and we need to use trees to erect and move Moai. Do you see where I'm coming from?

 
At Sunday, December 11, 2005 at 5:42:00 PM PST, Blogger JD said...

Address it for the interim within the context of a hedging stategy.

Hedging is a great idea, but are we talking about private sector hedging, or hedging with public money? If we're talking about private sector hedging, do the electrical utilities have enough money to invest for both the usual infrastructure, and the just-in-case infrastructure? If we're talking about hedging with public money, then who decides where that money goes? The oil/automobile industry is gigantic, well-funded, and deeply entrenched in the subsidy process. They're not going to support subsidies for the electric industry. That might just be a trojan horse, to promote trains/EVs and threaten their market stranglehold.

Here's the key question: If you support early subsidies, how are you going to stop the status quo (oil, cars, refiners etc.) from sucking all the subsidies down? People love their cars, and the people doling out the subsidies (politicians) will, of necessity, cater to that. It's like political ju-jitsu. If you loudly support early government intervention, your opponent (the oil/car lobby, Dick Cheney etc.) will pick up your rhetoric, and us it against you. "We need subsidies, or else we will be facing economic chaos. One out of six jobs in this country depends on the auto industry."

 
At Sunday, December 11, 2005 at 6:00:00 PM PST, Anonymous Anonymous said...

"The problem is that, if we assume Hirsch is correct, then you are giving a blank check to entrenched pork interests."

So by your reasoning then, if we assume Newton is correct the we are giving a blank check to entrenched apple interests? And if we we assume Einstein is correct then we are giving a blank check to entrenched light bulb interests?

Excuse me! But I don't see how sleeping with dogs automatically means we are going to get chiggers. Some of us dust regularly with flea powder.

 
At Sunday, December 11, 2005 at 6:04:00 PM PST, Anonymous Anonymous said...

JD you said, "Economic dislocations are something we should welcome -- as the first step toward healing. It's a little like the last tree on Easter Island. Should we cut it down? Well, we pretty much have to if we want to avoid severe economic consequences, because the economy of the island is based on Moai, and we need to use trees to erect and move Moai. Do you see where I'm coming from?"

Yeah I see where you are coming from. You sound just like any heartless economist who would trivialize depression, economic dislocations and other human pain as "demand destruction." Well from your obvious ivory tower I can see why.

 
At Sunday, December 11, 2005 at 6:54:00 PM PST, Blogger dub_scratch said...

Rock on JD!

What I see when I imagine how this mitigation policy gets put together is a whole lotta pork going over to the big oil, big auto & big agrabiz industries.

Much of that game is already in play. Look at the subsidies for corn ethanol that we cannot get rid of. Look at the subsidies for oil & energy companies in the last energy bill, despite of the fact that they are swimming in cash right now. Look at the way hybrid buyers get a tax break for buying what is essentially a nonessential energy wasting luxury (the auto industry is currently licking its chops over this one). All of the above are justified by our government as "energy security".

So when PO mitigation does get put together, are we going to get more of the same? You bet. And are we going to see a large call for greatly diminished auto dependency? I would love that but I ain't gonna hold my breath. By definition, deminishing auto dependency in the US IS 'economic dislocation'. And as JD noted, much of this effort will be to prevent this sadly needed economic dislocation.

JD is also right that our irrational addiction to cars (and sprawl) that IS our energy problem. I regret to agree that the only way to rid ourselves of that addiction is economic dislocation de-tox therapy.

 
At Sunday, December 11, 2005 at 7:01:00 PM PST, Blogger JD said...

You sound just like any heartless economist who would trivialize depression, economic dislocations and other human pain as "demand destruction."

If you want to subsidize the auto/road/oil/CTL/GTL business, and the whole chain of bottom feeders dependent on it, do it with your tax money, not mine. I don't drive. In fact, you car driving folks owe me money, because you're stinking up the air I breathe.

Here's an idea: internalize the externality. Connect the tail pipe directly to the inside of the car. You fart it out, you breathe it.

 
At Sunday, December 11, 2005 at 8:16:00 PM PST, Blogger Roland said...

Type III depletion can only be counteracted by NEW OIL REGIONS. We are not finding them!

If, due to some miraculous new technology, we are able to get that previously unrecoverable oil and reverse the decline, then it will turn out it wasn't really type iii decline after all, was it?

Otherwise I agree with you though.

 
At Monday, December 12, 2005 at 5:36:00 AM PST, Anonymous Anonymous said...

JD, I get where you are coming from...

The solutions to peak oil and environmental problems have-as you and Chris L mentioned- massive entrenched vested interests to overcome.

I also agree with you guys on mitigation. Although the Hirsch Report appears to focus on supply side solutions, it states that demand side solutions must also play a role. This leaves open a political target that sensible peakniks like yourselves must attack.

However, early government driven demand reduction solutions will be a necessity. Let the market punish heavy users, but create a solution with mass transit at the same time. Perth is a good example of a city implementing demand reduction strategies both for fuel and water use.

PO is a political and economic battle. I agree that crises are inevitable in the renewal process. How else can the existing vested interests be attacked?

 
At Monday, December 12, 2005 at 6:34:00 AM PST, Anonymous Anonymous said...

You sound just like any heartless economist who would trivialize depression, economic dislocations and other human pain as "demand destruction."

The alternative is greater pain. We're going to have to go into withdrawal SOMETIME.

 
At Monday, December 12, 2005 at 10:51:00 PM PST, Anonymous Anonymous said...

wow JD does not drive. But someone drives your food to you. Or do you grow your own? Nah. Much too doomeristic

 
At Monday, December 12, 2005 at 10:52:00 PM PST, Anonymous Anonymous said...

so what is with the magic letters that we have to type in. Are they some kind of security code?

 
At Tuesday, December 13, 2005 at 3:31:00 AM PST, Blogger Roland said...

wow JD does not drive. But someone drives your food to you. Or do you grow your own? Nah. Much too doomeristic

The point is that about 5% percent of oil is used transporting food, where as more than ten times as much is used in private automobiles.

JD's food gets driven to him in a van with food for hundreds of other people. When you drive a large car around, on the other hand, you use a similar amount of petrol just to transport one person.

None of us claim that oil is not usefuel, but there is no need to personally burn it ourselves.

 
At Tuesday, February 14, 2006 at 10:22:00 AM PST, Blogger sir.dave said...

Very illuminating! Lots of derisive
talk about "doomers", yet I see that
the idea of "massive economic dislocation" is viewed in a positive
light! Sounds like an embrace of
doomerism to me. This economic
dislocation is viewed as necessary
to cope with a broken market/govt.
that will only serve entrenched
interests. Again, that sounds like
doomerism to me.

To extend this approach to climate
change, we see that surely the earth
will come thru ok, eventually, but humans might be in for a
bit of a hard time. But hey, that's
what its going to take to fix the
problem. What's the problem with a
bit of "environmental dislocation"
when that's what will ultimately
fix the problem?

 
At Monday, June 26, 2006 at 5:50:00 PM PDT, Blogger mealymind said...

The idea that economic dislocation will be the major force for change brings about the sticky question- Will the reaction to that dislocation be the hijacking of new public programs by big business?

If so then hoping that economic dislocation will let the invisble hand of the market lead us away from dependence on oil may be a very empty one.

As new public money is channelled into demand side solutions there will little left in the kitty for the more appropriate solution- massive education programs and capital made available for people to embrace less energy intensive lives.

Remember that the government of America is bonded in service to big business and for it to fund demand side initiatives is counter to business interests. Unless there is a political paradigm shift it is more than likely that supply-subsidies will outstrip demand-alternatives.
I am happy to admit that I am not a resident of the Northern hemisphere and that while my government does side with the status quo we do not support American imperialism or big business anymore than absolutely necessary. We are a nation of early adopters and proudly self reliance. We are Kiwis and every day i give thanks for that.

 

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