Peak Oil

Alternet has a nice write up on how peak oil has passed from crack pot idea to mainstream theory with oil peak dates issued by even the Department of Energy. The discussion of taking preemptive action about oil production peaking reminds me of the social security debate. Even the most conservative prediction for oil peak (2037 from the DOE) beats the day when social security starts running in deficit mode, and the consequences are far more severe. The world has two options - burn baby burn, or immediate conservation efforts.

As the article points out, a 60 year resource assuming a 4% growth rate in demand can be turned into a 300 year resource assuming a 0% growth rate. But with an annual 4% decline in demand the same resource can last effectively forever, wouldn't that be a nice legacy to leave for our decendents?

But no, the only response we've seen from the government is to just keep down the same path of burning oil like its an unlimited resource. Once in a while they'll pooh-pooh conservationists and mutter stuff about leaving the problem to "market forces". However what people forget is that the world has already experienced what happens when growth is left to market forces - its called the boom and bust cycle. This happened over and over until the 1930's when government started getting involved in regulating the economy and controlling the reaping of the commons. So with market forces in control the best we can expect is boom and bust in the energy world, something that was widely agreed to be a bad thing when applied to the rest of the economy.

However by heavily subsidising the oil economy (it's the free roads, tax breaks for oil exploration, production and free license to pollute stupid!) the government is actually putting its foot firmly on the energy growth accelerator. If the government was doing the same with regular fiscal policy it would be like cutting interest rates to 0% and opening up the spigot of government spending to the max, again widely agreed to be not a good thing.

Personally I believe market forces on the demand side will eventually catch up with the energy business. People will begin to take matters into their own hands and demand less demand, if you see what I mean. However at that point it may be way too late in the energy game. Countries like China and India that have a history of dealing with scarcee resources may actually have leapfrogged the USA in the conservation game and we'll be heavily dependent on their technology, and their products to get along. Really that might not be such a bad thing because being self-proclaimed top-dog in the world has definitely starved this country of humility and respect for our fellow people on this earth.