I’m not worried about the world running out of oil. There’s plenty of oil out there. As has been noted, it’s simply a matter of the extraction being cost-effective. I expect Canada will become very rich this century.
And it’s just a combination of hydrogen, carbon, and oxygen. Maybe some bright spark 
will invent a way to synthesise it?
It might turn out that way, if you Canucks were not supporting terrorists and developing weapons of mass destruction. As it is . . . [sigh] . . . well, something may have to be done . . .
Transportation isn’t the only factor by a long shot. Farmers don’t tend crops with a hoe and a sickle, nowadays. Also, the production of fertilizers isn’t petrochemicals free.
I am wondering if this would affect population demographics. The southern states particularly Florida, Texas and Arizona only came into play when air conditoning was introduced. Does it cost more for the air conditioning than the heat. Surely Phoenix w/o air conditioning goes back to being a small town of 45,000.
I am wondering if this would affect population demographics. The southern states particularly Florida, Texas and Arizona only came into play when air conditoning was introduced. Does it cost more for the air conditioning than the heat. Surely Phoenix w/o air conditioning goes back to being a small town of 45,000.
Phoenix gets its power from hydroelectric and coal-fired generators, so that’s no problem. Ditto most of the rest of the warmer states. A bigger problem is dealing with the frozen North and fuel oil heating.
The skyways were in place when my family moved to Minneapolis in 1975, so I couldn’t compare to what it was like before. They are ok, but they’re not even close to fullfillig the idea of an “arcology”. Basically, Minneapolis did a better job than many urban centers of coping with the decentralizing effects of suburbs and freeways (this despite the fact that the Twin Cities metropolitan area is an infamous example of suburban “sprawl”). The skyways make downtown Minneapolis a more pleasant and convenient place to shop and eat, but only if you happen to be there anyway. I’d say that 95+% of the reason for their existance is simply to accommodate the downtown office workers: a place you can grab a bite if you left before breakfast, a place to eat or shop on your lunch hour, a place you can buy a few items after work before going home. Other than a few nightspots (mainly in the adjoining “warehouse” district just off of downtown), downtown Minneapolis has little to offer after 6:00 pm. Since the skyways rely on the buildings they pass through for connection, they’re mostly closed after early evening.
Besides transportation, there’s a shitload of products dependent on oil - and one product close to the top of the list is food.
As to what will be done politically, nothing at all. The market will sort it out. People will simply seek alternative products. The problem as I see it is what will happen to the global economy (and our jobs) as the cost of production increases and investments yields lower returns.
Nothing done politically? Haven’t you noticed this huge army camped in Iraq?
Why is it ‘blind faith’ to look at the various alternatives…most of which already exist (and some of which, as Lemur866 pointed out, have existed for quite some time)? What you quoted is a bit misleading BG. Sure, these alternatives aren’t as cheap and aren’t as flexable…so what? At some point there will be an event horizon where they become more flexable and cheap than where oil will be. Its really that simple.
Just because literally billions (perhaps trillions) are at stake, no need to think that someone will solve the problem, ehe? Especially since there are several promissing possibilities ALREADY out there…possibilities that require no pie in the sky or futuristic miricle technology, ehe?
Sorry, but I’ll put my ‘faith’ in greed and human ingenuity. You can put your’s in the opposite if you like. Hopefully you and I will both live long enough to see who’s right. 
-XT
It’s not just ‘ambitious’, it’s ridiculous. The scale of what you are talking about is orders of magnitudes greater than any of the other solutions to the problem.
A trillion dollars, for one city? Let’s say that were true. 10 million workers? Where are you going to get them from? Oh, and how much energy is it going to take to dismantle and rebuild this mega-city? How much concrete will have to be hauled? How much new steel mined and shipped in?
How many decades would it take just to recoup the energy cost of rebuilding a city?
The entire U.S. uses about 700 billion dollars a year in energy (this includes fertilizer, road asphalt, etc). That’s about $2500 per capita. Let’s say you build your city for 10 million peoople, and it costs a trillion dollars. And for that, you cut their energy usage in half. So you’ll save $1250 per capita. So it would take you almost 100 years just to recover the cost (actually, much longer considering the time-value of money). And that’s ignoring the energy costs of building the thing in the first place, which would probably more than equal another 100 years of energy savings. So we’re talking about A) vastly INCREASING our energy consumption during the construction phase, so that we can cut our energy afterwards in half. We won’t be at breakeven for energy within 100 years, and we won’t recover the cost for hundreds more.
Still sound like a good idea?
In comparison, estimates I’ve seen for converting the gasoline distribution system to hydrogen runs between 500 billion and 1 trillion for the entire country.
Then there’s all the issues of housing all the displaced people while you rebuild a city, taking all those workers away from whatever other jobs they are doing, etc.
Oh, and of course you have to convince everyone that they really want to live in a big arcology packed in line sardines - or put a gun to their heads.
Brain, I realize you are a smart guy, and I have a lot of respect for your posts.
A government-planned railroad system is a horrid idea. A government-funded system is slightly better but still awful.
The history of government investment in internal improvements is riddled with corruption, waste, and inefficiency, and there is a very good reason for this…the incentives are all screwed up.
Let’s say you are running a railway company without any subsidies from government. You will definitely look to complete the railway as fast and as efficiently as possible, because it is your money at stake. You also are looking to do it right the first time because nothing will be more expensive than having to redo the entire track.
Now, contrast this with running a railway company funded by the government. You want to take as long as possible. Why? Because when you finish the government stops funding you. You don’t care if the railway is solid or not because your pay won’t change in any event. It makes sense to do a poor job as slowly as possible and to give no-bid contracts to your friends…because why not? It’s not your money.
Further, If people actually demanded high-speed rail travel, IT WOULD EXIST ALREADY. But it doesn’t. Why? Because people don’t want it. Unlike Europe, the major cities in the United States are very spaced out. And as high-speed rail lines go about 1/2 as fast as standard airplanes do (200 mph vs. about 400) there is a bunch of wasted time that isn’t nearly such a big deal as it is in Europe. Based on these factors and many others, entrepreneurs in this country realize that building a high-speed rail network is, at the current time, totally pointless and a waste of money.
Also there’s that whole thing about taxation directly reducing the standard of living of all involved. People don’t want to spend their money on train travel. So rather than accept this and move on, you propose to force them to subsidize some corporations to build a railroad that they don’t want? HOOORAY corporate welfare!
In regard to peak oil, I’m going to refer to a great blog entry from Paul Phillips’ blog:
…Most people spend all their worrying energy worrying about the wrong things. Welcome to the club.
You referenced The Long Emergency in your email. Wow. I encourage everyone to read this just to see exactly how clueless people can get. It’s hard to pull just one quote, but:
“The American economy of the mid-twenty-first century may actually center on agriculture, not information, not high tech, not “services” like real estate sales or hawking cheeseburgers to tourists. Farming. This is no doubt a startling, radical idea […]”
Startling, radical, and completely brain-damaged. Even the 9/11 conspiracy nuts make a better case than this guy.
I recently read this awesome (incomplete) book Future Imperfect. You should read it too, but for now just skip to the end for the section “Environmentalism, Resources, and Why We Should Worry About Global Warming But Not Just Yet.” Some quotes:
“One reason their predictions were wrong was their failure to take account of basic economic principles.”
Not just one reason, by far THE reason. And it’s the same reason this knustler fellow is wrong. Whenever you see a guy predicting the fall of civilization, demand testable predictions. Let’s see one of these prophets of doom be right about something little, something easy, before we start assuming we’re all going to be living in ramshackle huts and growing our food amongst cracks in the concrete.
“It was as if they were trying to predict what would happen on a highway by extrapolating the paths cars were following, while ignoring the fact that each car had a driver with good reasons to avoid colliding with other cars.”
Uh-huh. And one more, a meatier excerpt to try to illustrate the futility of fretting about our running out of oil:
"We live in a radically uncertain world. It is entirely possible that, fifty years from now, our species will no longer exist. It is also possible that, fifty years from now, we will have powers enormously greater than at present. Even if we end up between those two extremes, the odds are high that in fifty or a hundred years we will be living very differently than at present.
"That might mean a drastic reduction in power consumption–you can have a lot of fun with very little energy in a world of deep VR. It might mean a shift to power sources, such as nuclear or orbital solar, that generate no greenhouse gasses. It might mean a world of low cost space transport, with population expanding through the solar system. It might mean low cost ways of reducing the earth’s absorption of heat from the sun–a very large array of orbiting mirrors, for example. More modestly still it might–in my view probably will–mean a world sufficiently wealthy, and with sufficiently advanced engineering, to make the diking of Bangladesh a considerably less difficult project than the diking of the Netherlands was a few centuries back.
"If all of this seems like wild eyed pie in the sky speculation, consider how much the world has changed over the past century. A hundred years ago medicine could cure very nearly nothing–with rare exceptions, all a competent doctor could do was tell the patient whether he should be taking a few days off work or making his will.[236] The usual form of individual transportation was walking, riding a horse, or riding in a horse drawn carriage. The only form of rapid communication available to ordinary people was the telegraph, sending short messages in Morse code at a fairly high price. The adding machine was a recent invention; the only sorts of mechanical calculator in common use were the slide rule and abacus.[237] The first powered heavier than air craft capable of carrying a human being had just flown–for twelve seconds and 120 feet.
“The changes from then to now were in large parts changes in technology–in what human beings knew how to do. Those changes are continuing. Arguably their rate is accelerating, as developments in one field make easier developments in another. To make plans for the world of a century hence today, based on today’s technology and practice, makes no more sense than it did in 1900–when a man with an eye to the future might have worried about avoiding a collapse of the transportation system due to a shortage of hay and oats.”
The guy in 1900 worrying about a hay and oat shortage at least was understandably ignorant of the pace of technological change. Today we have no such excuse.
If you want to fret about something, fret about grey goo, fret about engineered superviruses, fret about global nuclear war. We’re not going to run out of energy: not a chance. *
He he, I should have foreseen that this thread would evolve into just another Pro Con Energy Crisis Thread. So let me throw in my two cents:
A lot of people, especially Americans, are putting their faith in the market. That high oil prices is no problem at all, as this will only force other alternatives to emerge. Coal and nuke being the prime candidates. I read that one guy here wrote that nukes will last for millions of years. Now that’s the most optimistic figure I’ve seen for the global nuclear energy reserves! I guess that person must have been talking about fusion, and not fission, which is the only alternative we have today.
But there are huge amounts of coal on this planet.
However, for you free market fundamentalists, there is one externality the market has not yet internalised: that of environmental destruction. And coal is perhaps the worst energy source this planet has, in terms of environmental destruction. One thing is the local total destruction of a coal mountain strip mine (they remove entire mountains), but another is global warming. I know you guys like to see numbers, but really, to try to calculate the cost of the future environmental destruction caused by global warming is close to impossible (even if you discount it). But that it will be worse than humans have ever seen is very likely.
My other point is that people are often equalising one unit of energy to another. It is vital that we include the concept of EROEI in this discussion! EROEI is Energy Return on Energy Invested. EROEI is currently decreasing worldwide, from the initial cheap oil in the 20th century, when EROEI was over 100, to the typical 1-10 today. Remember that EROEIs under 1 means that you use more energy than you get.
See this list for several energy sources: eroei.com domain is for sale | Buy with Epik.com
So people have to stop comparing coal to oil, they’re completely different in terms of EROEI.
To bring discussion a bit onto track (what can be done?), I thought I should list some things I think should be done (and boy, do I know people will pounce on several of the items on the list ):
The world would have to adapt to an economy in which today’s levels of tourism would plummet, and in which plane transport would be reduced to a minimum. Also, SUVs would become anachronisms. In short, people would have get used to travel less, and much shorter distances.
Suppoose we opted to FORCE people to scrap SUVs and trucks, and use those very small engined-high mileage commuter cars. If the CAFE average mileage was raised to say 45 MPG, could we free ourselves of oil imports? That would make more sense and be cheaper to handle than rebuilding cities, adding mass-transist systems, etc. Plus, compared to the costs of keeping the army in iraq-its a much better option.
Y’know, I’m fucking sick of being called a market fundamentalist because I expect the law of supply and demand to continue to operate in the future.
I’m not expecting magic solutions to all our problems. Just that people will make semi-rational choices most of the time, so if gasoline is $10 per gallon, while biodiesel, or alcohol, or hydrogen, or natural gas, or electric is cheaper, they’ll pick the cheaper alternative. Call me crazy.
Now, about Kristian77’s proposals.
I’d simplify it to one, increase the tax on fossil fuels. Forget massive government funded research programs. Government is terrible at picking technological winners. Government research should be steered towards basic science and public health, not finding ways to make cheaper and more efficient consumer products. That’s what businesses do. If you want to encourage businesses to produce cars and houses that conserve energy, just put a tax on energy large enough to cover the externalities that you believe are produced by a specific type of energy consumption, plus a little extra.
So go ahead and slap a $2.00 per gallon tax on gasoline and fuel oil, and a whatever tax per ton of coal burned. And then stop. Let consumers figure out the most efficient way of reducing fossil fuel use. Because I guarantee you that 250 million people figuring out ways to reduce their individual energy use is going to be more effective than some government panel.
And as I’ve said before, the problem is not that we don’t have energy alternatives. We have plenty. We don’t need a crash research program to try to develop more, we have all we need. Discovering more won’t help, because those newly discovered alternatives aren’t going to be cheaper than gasoline at today’s prices. There are dozens of alternatives we can turn to when gasoline gets up to $5 or $6 per gallon. Research into alternatives isn’t going to do anything to get people to actually adopt those alternatives until the price of gasoline exceeds the price of the alternatives.
Now of course there’s a cost to switch, so gasoline has a built in advantage because of the already installed infrastructure and vehicle fleet. So in reality an alternative fuel needs to be quite a bit cheaper than gasoline before you’ll see a very large shift. Which is where simply increasing the gas tax comes in. Just increase the gas tax and you’ll see a shift to alternatives sooner. That’s the smart way to prime the pump. We don’t need research, the big cost of alternatives isn’t research, it’s actually constructing the infrastructure needed. More research won’t help that, and no one will invest in new infrastructure to replace gasoline while gasoline is cheaper or equal.
If you want alternatives to coal we don’t need research, we already know the alternative. Nuclear. Done. The barrier to nuclear isn’t technological, it’s economic and political. And anyway, we’re not going to run out of coal any time soon, we’re not facing an electrical generation crisis, what this thread is about is a gasoline shortage. Peak oil, anyone? Not peak coal, not global warming, not electrical brownouts.
My point is that there isn’t anything magical about petroleum. It is cheap and convenient and energy dense. But if you’re willing to pay more there are alternatives. Trouble is, most people don’t want to pay more. But if it’s important to reduce demand, we use the power of the state to force them to pay more by increasing the gas tax.
I know what you mean. I think it comes from folks who THINK they actually understand how ‘the market’ works but don’t. Sort of like creationists who THINK they understand how evolution works but don’t…and then go on to ‘prove’ that evolution is based on faith just like creationism so why can’t their pet theory work as well?
I agree with your post for the most part…using taxes to give the market a nudge by increasing the price at the pump and the price of other energy will accelerate the move to whatever is the next generation fuel source(s)…one that will be ‘chosen’ from out of the crowd of current perspective alternatives by simple market forces. PEOPLE will decide what is best for them wrt price and availablility/ease of access.
Then all the nay sayers in this thread can bitch about the new Bill Gates in a few decades…‘How come S/HE has all those billions of dollars? Doesn’t seem fair…’
-XT
It’s especially annoying because I specifically mentioned lots of things that would reduce demand other than driving a single passenger vehicle exactly the same as vehicles today, only now burning mystery alternative fuel X.
Like carpooling. Vanpooling. Buses. Light rail. Commuter trains. Working from home. Telecommuting. Moving closer to work. Getting a job closer to home. Driving a moped. Riding a bicycle.
People don’t bother doing these things today because they can be inconvenient, and don’t offer much cost savings compared to driving their 20 mpg sedan 2 hours every day back and forth to work.
But as gasoline prices ratchet up people start to make different choices. Even if we passed a law that no new fuels could be brought to market, and no vehicle technological improvement was allowed, we could still reduce gasoline consumption dramatically. Except the alternatives to driving a gasoline burning car have costs. And the cost of driving a gasoline burning car is still pretty low, despite the fact that gasoline prices have doubled in the last few years.
People seem to have the idea that our GDP is directly correlated with increased gasoline consumption, and if the price of gasoline doubles then our GDP should be reduced by half.
Thing is, gasoline is only a small part of the expense of owning a car. Gasoline doubling, or tripling, or quadrupling isn’t going to quadruple the cost of transportation, even if you weren’t allowed to buy a different car that was more efficient or used different fuel.
So if gasoline is $10 per gallon, are you shooting your neighbor with a crossbow and siphoning his tanks for precious juice, or do you give up driving your Hummer 60 miles to work every day and take the bus 4 days a week and telecommute every Wednesday? Even at $10 per gallon your cost of transportation driving the Hummer doesn’t even double compared to gas $2.50 per gallon, even though the price of gasoline has quadrupled.
For those predicting disaster, how soon are we going to hit $10 per gallon gasoline? 5 years? 10 years? 20 years? Now, will $10 per gallon gasoline mean the end of civilization? Or will it be a pain in the ass that we’ll deal with by conservation, more efficient cars, driving less, commuting less, and switching a much larger fraction of our vehicle fleet to hybrid electric, ethanol, natural gas, gassified coal, and biodiesel (considering only alternative fuels that are in wide spread use today and are mature proven technologies)?
This is market fundamentalism? What do we call the opposite, blind faith that the law of supply and demand doesn’t exist? Market flat-earthism? We need no new technologies, just new infrastructure. No miracles required, we just have to eventually build new stuff we already know how to build, instead of the kinds of stuff we build today. Or rather, an increasing fraction of our transportation infrastructure spending will be on things other than gasoline burning single passenger full-sized vehicles. And if you’re expecting sharply increasing gasoline prices, don’t buy a gas guzzler any time soon, and begin now to arrange your life such that you can live with $10 per gallon gasoline.
The problem is that some people dispute that point.
Even on a purely economic basis, the ecological movement has been laudable for forcing the market to “internalize” the value of a clean healthy ecology. But a radical fringe claims that a key presumption of market economies- that purely local decisions by individuals lead to a workable global system- is untrue. According to this view, left to their own devices individuals will selfishly promote their own welfare until they have destroyed the resources that supported them, as in the parable of the Tragedy of the Commons*. Thus you get “ecosocialism”, the concept that ultimately the “wise” people who can see and plan globally must tell the stupid selfish proles what’s good for them, and if they don’t like it tough.
*which in my opinon proves the unworkability of socialism rather than private property.
Oh, yes I will.
Ugh. Great. So the problem with the status quo is that in the future our standards of living might be reduced because oil will become scarcer…and your solution to this problem is to reduce our standards of living NOW? Because that is always what taxation does…it diverts capital from higher-valued uses to lower-valued uses and reduces the purchasing power of all members of society, which hurts - you guessed it - the poor more than anyone else.
If by completely redesign you mean sack entirely then we are on the same page, but I doubt that is what you mean.
Again, at the moment, people really don’t demand public transportation…and jamming it down their throats by funding it with taxes doesn’t change that fact. All you are doing is stealing money from people and spending it on something they don’t want and don’t use. How can that conceivably make us better off? For a classic example, look at MARTA in Atlanta, or the light rail in San Jose.
If and when oil becomes scarce enough that people will want to use buses/trains/et al. instead of cars, then the market will provide those services, because there will be a ton of money to be made.
You realize that all this stuff is already happening, right? Government is subsidizing research and development in renewable energies all over the place. Guess what - it’s totally unnecessary.
If you are running a government research program - you have no incentive to actually solve the problems of your mandate. Why? Because if you do actually solve the problem, your funding will get cut. OTOH, if you fail, you’ll be able to request and receive more money, increasing the power of your program! If you were wondering why current government research programs rarely show any fruit…well, this is the main reason.
And why can’t we just let the energy companies do this themselves? All the incentives line up correctly. If and when oil becomes scarce enough that people demand alternatives, then these companies will be looking at the biggest business opportunity in the history of mankind. As such, amounts of capital that can’t even be comprehended will be shifted to the development of alternative energy and efficiency, and without any government intervention at all. Plus, they will actually have an incentive to succeed, unlike the government research programs, because there will be a huge reward for success: profit.
Why do you think this won’t happen…naturally? That’s the beauty of the price system…the more expensive gasoline gets, the less inclined people are to use gas. It doesn’t take a triple-digit iq to decide to use less gas because gas costs $10 a gallon.
Guys…we aren’t running out of energy. The biggest threat to our standard of living doesn’t come from peak oil - it comes from government intervention in the market.