276. ECONOMIC GROWTH WITH FLAT FOSSIL FUEL CONSUMPTION
One of the central beliefs of peak oil is that flat or declining consumption of fossil fuels will cause economic growth to halt and decline.
Oddly enough, DOE statistics show that -- at least in the case of personal gasoline and natural gas consumption -- this was not true in the U.S. for the 20 year period from 1981 to 2001.
Per capita oil consumption for transportation was flat:
Per capita residential consumption of natural gas declined:
Meanwhile, the real GDP doubled (click for a clearer picture):
And the DOW rose from 947 in Jan. 1981 to 10788 in Dec. 2000 -- an increase of about 11.4 times (1040%). With no increase in per capita consumption of oil for transportation, or residential natural gas.
Thanks to Paul and dub_scratch, who caught me doing some of my usual monkey business in this post. They are right that a better comparison is with real GDP per capita, given in the following Table:
As you can see, the point holds true. Real GDP per capita grew by 50% from 1981 to 2001.
More broadly, this shows that increasing real GDP (both gross and per capita) and increasing stock prices are perfectly compatible with zero growth in personal driving, and decreasing use of natural gas in the home.
-- by JD