NationStates Jolt Archive

COMMENTARY: When a country engages in international trade to the point where they begin to reach full employment and a considerable percentage of the population is now considered to be "middle class," trade will begin to flow to other countries where labor is more plentiful. In this slow but steady shift of manufacturing jobs, each economy touched winds up with much of the population benefitting. This is what is happening in China. It's essentially what happened in Japan after WWII.

Your thoughts?


Labor Shortage in China
May Lead to Trade Shift (http://www.nytimes.com/2006/04/03/business/03labor.html?_r=1&th&emc=th&oref=slogin)


By DAVID BARBOZA
Published: April 3, 2006
SHENZHEN, China — Persistent labor shortages at hundreds of Chinese factories have led experts to conclude that the economy is undergoing a profound change that will ripple through the global market for manufactured goods.

The shortage of workers is pushing up wages and swelling the ranks of the country's middle class, and it could make Chinese-made products less of a bargain worldwide. International manufacturers are already talking about moving factories to lower-cost countries like Vietnam.

At the Well Brain factory here in one of China's special economic zones, the changes are clear. Over the last year, Well Brain, a midsize producer of small electric appliances like hair rollers, coffee makers and hot plates, has raised salaries, improved benefits and even dispatched a team of recruiters to find workers in the countryside.

That kind of behavior was unheard of as recently as three years ago, when millions of young people were still flooding into booming Shenzhen searching for any type of work.

A few years ago, "people would just show up at the door," said Liang Jian, the human resources manager at Well Brain. "Now we put up an ad looking for five people, and maybe one person shows up."

The bottom line: For all the complaints of factory owners, though, the situation has a silver lining for the members of the world's largest labor force. Economists say the shortages are spurring companies to improve labor conditions and to more aggressively recruit workers with incentives and benefits.

The changes also suggest that China may already be moving up the economic ladder, as workers see opportunities beyond simply being unskilled assemblers of the world's goods. Rising wages may also prompt Chinese consumers to start buying more products from other countries, helping to balance the nation's huge trade surpluses.

"The next great story in China is how they are going to move out of the lower-end stuff: the toys, textiles and sporting goods equipment," said Jonathan Anderson, an economist at UBS in Hong Kong. "They're going to do different things."

When sporadic labor shortages first appeared in late 2004, government leaders dismissed them as short-lived anomalies. But they now say the problem is likely to be a more persistent one. Experts say the shortages are arising primarily because China's economy is sizzling hot, tax cuts have helped keep people working on farms, and factories are continuing to expand even as the number of young Chinese starts to level off.

Prosperity is also moving inland, and workers who might earlier have migrated elsewhere are staying closer to home.

Though estimates are hard to come by, data from officials suggest that major export industries are looking for at least one million additional workers, and the real number could be much higher.

"We're seeing an end to the golden period of extremely low-cost labor in China," said Hong Liang, a Goldman Sachs economist who has studied labor costs here. "There are plenty of workers, but the supply of uneducated workers is shrinking."

Because of these shortages, wage levels throughout China's manufacturing ranks are rising, threatening at some point to weaken China's competitiveness on world markets.

Li & Fung, one of the world's biggest trading companies, said recently that labor shortages and rising manufacturing costs in China were already forcing it to step up its diversification efforts and look for supplies from factories in other parts of Asia.

"I look at China a lot differently than I did three years ago," said Bruce Rockowitz, president of Li & Fung in Hong Kong, citing the rising costs of doing business in China. "China is no longer the lowest-cost producer. There's an evolution going on. People are now going to Vietnam, and India and Bangladesh."

The higher wages come at a time when costs are already rising sharply across the country for energy and land. On top of a strengthening Chinese currency, this is likely to mean that the cost of consumer goods shipped to the United States and Europe will rise.

To be sure, China is not about to lose its title as factory floor of the world. And some analysts dispute the significance of the shortages.

[ This article is two pages long. Read the second page (http://www.nytimes.com/2006/04/03/business/03labor.html?pagewanted=2&_r=1&th&emc=th). ]

The faster China's economy grows, the sooner we run into the grim reality that our natural resources are limited. I don't know if that's a good thing or a bad thing. If it means the frog jumps out of the pot instead of being boiled to death, it might work out for the bst.

Meh! Don't buy it.

The world only has so much natural resources and we are falling all over ourselves with greed at the prospects of increasing the living standards of 4 billion people(India and China). It will bite us.

As it was suggested the shortages are an anomoly. For a country of 3 billion; I am having a hard time beliving there is a real shortage of workers......

Meh! Don't buy it.

The world only has so much natural resources and we are falling all over ourselves with greed at the prospects of increasing the living standards of 4 billion people(India and China). It will bite us.

There is no avoiding or even postponing the rise of India and China. The other world countries can either participate in this growth or lose opportunity for trade.

Trade between India and China is booming and in another 5 years or so, India's volume of trade with China will surpass its volume of trade with the US. And as China's manufacturing matures and people grow wealthy, there will be a big market for Indian service industries which will be bigger in size. In effect, the Indian and Chinese economic may very well become symbiotic and grow on the strength of their internal markets and complementary strengths.

Now the US and the world can either participate in this growth (as they are doing currently) or sulk away at the thought of erstwhile third worlders attaining the standard of living that they rightly deserve after having suffered injustices during colonial and imperial era at the hands of the very western nations that are now wary of the growth of these countries.

It's not like the Indians and Chinese were always piss poor. Until 1500, their combined economies accounted for almost 50% of the world economy. It is only a natural evolution that they go back to that stage when they are free of colonialism.

I posted this in another thread, but it may be more relevent here.
DUBLIN, Ireland, Apr 03, 2006 (BUSINESS WIRE) -- Research and Markets ( http://www.researchandmarkets.com/reports/c35170) has announced the addition of China Energy Market Trends Report 2006 to their offering.
A new report details the current and future state of the energy industry in China. This report is for strategists and researchers seeking to identify market potential for their products and services in all sectors of the China energy industry. Give yourself the competitive edge with this soon-to-be published report.
China's economic trajectory has driven its expanding energy needs, and it is now the world's second largest energy consumer behind the United States. Accompanying this increasing energy demand has been a growing dependence on imported oil, and China is now the world's third largest oil importer. China will continue to be a major player in world energy markets, but increasing energy demands pose tremendous challenges.
China's present phase of economic and industrial development requires higher energy consumption per unit compared with developed nations. China's energy sector has enormous potential, especially the coal, petroleum and natural gas industries, yet China is currently a net importer of oil, and imports are expected to increase to more than 900 million barrels in 2006, against a total demand of 1.993 billion barrels per year. China is looking to expand its production of coal, natural gas, and renewable energy sources such as nuclear, solar and hydroelectric power to meet the enormous appetite for energy spawned by its massive industrial complex and consumer sectors.
It is estimated that in 2020, China will need 2.8 billion tons of coal and 600 million tons of crude oil, two and a half times more than in 2000. Given this scenario, China will need to import 250 million tons of petroleum, about 70%, from foreign sources. What's more, its carbon emissions will reach 1.94 billion tons, and China will likely overtake the US as the nation with the highest greenhouse gas emissions.Their economy will collapse because they will not be able to find that much oil on world markets and the price for the oil they do consume will be astronomical.

Meh! Don't buy it.

The world only has so much natural resources and we are falling all over ourselves with greed at the prospects of increasing the living standards of 4 billion people(India and China). It will bite us.

As it was suggested the shortages are an anomoly. For a country of 3 billion; I am having a hard time beliving there is a real shortage of workers......

where the fuck do you get your numbers? China has 1.3 billion people, and India has around 950 million. Combining to only 2.3 billion max. Chinese people do NOT take up half the world's population.

where the fuck do you get your numbers? China has 1.3 billion people, and India has around 950 million. Combining to only 2.3 billion max. Chinese people do NOT take up half the world's population.

India crossed 1 billion around 2000 AD and is probably above 1.1 billion now and projected to go until 1.5 to 1.6 in 2030 or so before stabilizing and reducing...overtaking China sometime in that process...

India crossed 1 billion around 2000 AD and is probably above 1.1 billion now and projected to go until 1.5 to 1.6 in 2030 or so before stabilizing and reducing...overtaking China sometime in that process...

Yeah, but at least India will stablize. I'm more worried about the African countries and their growth rates. They don't look like their problems are going to be resolved any time soon.

Yes! God bless you Eutrusca and God bless Convergence theory! It works, it always has and it always will! The US, Germany, Japan, South Korea, Taiwan, Singapore and now China are all demonstrating that populations do grow richer with industrialization!

Yes! God bless you Eutrusca and God bless Convergence theory! It works, it always has and it always will! The US, Germany, Japan, South Korea, Taiwan, Singapore and now China are all demonstrating that populations do grow richer with industrialization!
Yeah, well, their industrialization is going to be cut short coming up here real quick.

http://www.ibiblio.org/tcrp/doc/art/discgap.jpgWhere are they gonna get the energy?

From the CIA world factbook, a source that has no option but to be right!

The PRC: ~1.3 Billion Folks

http://www.cia.gov/cia/publications/factbook/geos/ch.html

The ROI: ~1.08 Billion Folks

http://www.cia.gov/cia/publications/factbook/geos/in.html

I posted this in another thread, but it may be more relevent here.
Their economy will collapse because they will not be able to find that much oil on world markets and the price for the oil they do consume will be astronomical.

Well the Malthusian "sky is falling" scare tactics of the 80s (remember the "not enough food for exploding population growth...) did not work either....I believe that solution can be found to anything...where there is a will there is certainly a way...

The crux of the problem is this....developing countries like China and India (in a lesser way) are willing to tradeoff environmental cost for development and the developed countries having raped the environment (and these developing countries) on their way to becoming developed have no effing right to moralise. Work with these countries to develop in an environmentally better way. Let the India-US nuke deal pass so that India can go the nuclear way for its power. If you don't do that, then don't blame India for lighting up the tonnes of high polluting coal that they have in reserve.

Yeah, well, their industrialization is going to be cut short coming up here real quick.
I'd imagine that we'll all have real incentive to be the number one producer of non-petroleum fired machinery then, eh?

Yeah, but at least India will stablize. I'm more worried about the African countries and their growth rates. They don't look like their problems are going to be resolved any time soon.
A result of a combination of horrendous governmental corruption, the fact that tribalism has continued to thrive whilst the nation-state failed to develop and irresponsible development goals are the things that tend to damage Africa the most. I really ought to consider AIDS in on this as well, because a massively infected and sure-to-die work force isn't good for economic growth either.

Yeah, but at least India will stablize. I'm more worried about the African countries and their growth rates. They don't look like their problems are going to be resolved any time soon.

The relatively richer southern and western parts of India have already stabilized. The problem is in the "cow belt" region of the gangetic plains which is still growing population wise, but is not growing economy wise.

African countries will stabilise...they are facing a demographic disaster with the AIDS problem. There are really scary projections of demographics of sub-saharan Africa...:(

Well the Malthusian "sky is falling" scare tactics of the 80s (remember the "not enough food for exploding population growth...)About a billion people in Africa and another billion in Asia thank you for reminding them how plentiful food is.

did not work either....I believe that solution can be found to anything...where there is a will there is certainly a way...

The crux of the problem is this....developing countries like China and India (in a lesser way) are willing to tradeoff environmental cost for development and the developed countries having raped the environment (and these developing countries) on their way to becoming developed have no effing right to moralise. who's moralizing? I'm simply pointing out that they won't complete their experiments in industrialization because there will not be enough oil and there is no viable substitute.

Work with these countries to develop in an environmentally better way. Let the India-US nuke deal pass so that India can go the nuclear way for its power. If you don't do that, then don't blame India for lighting up the tonnes of high polluting coal that they have in reserve.
I'm all for it, but it won't work. Nuclear power is reliant on oil and there won't be enough and what there is will be too expensive and too low of a quality. Oil was a one shot deal and we're all about to wake up from the party with a massive hangover.

I'd imagine that we'll all have real incentive to be the number one producer of non-petroleum fired machinery then, eh?
Such as? Most "substitutes" are really just inefficient ways to burn more oil and the only liquid fuels that do work are only good for small scale, local problems. There is no substitute for oil and natural gas as an industrial fuel. that's why we use them.

The relatively richer southern and western parts of India have already stabilized. The problem is in the "cow belt" region of the gangetic plains which is still growing population wise, but is not growing economy wise.

African countries will stabilise...they are facing a demographic disaster with the AIDS problem. There are really scary projections of demographics of sub-saharan Africa...:(
Near demographic collapses due to diesease have actually played important roles in history in the past. The industial revolution can be partially traced to the final recession of the plague from Europe, which left vast holes in society that needed to be filled, and just really couldn't be filled by peasant farmers.

Such as? Most "substitutes" are really just inefficient ways to burn more oil and the only liquid fuels that do work are only good for small scale, local problems. There is no substitute for oil and natural gas as an industrial fuel. that's why we use them.
At the moment most are very reliant on oil, but as oil becomes increasingly more expensive, people will look for substitutes, demand will rise and the market will do what it always does.

I'd imagine that when the whale population was collapsing 150 years ago, people said similar things to what you are saying now. People found an alternative to whale oil. Nuclear makes a delightful alternative same with the entire concept, and there's plenty of fuel lying around in missile silos all around the world.. Beyond that, think outside of the box, hell we could put massive wind farms on gigantic rafts and set them out to sea and use those sonsabitches for power. We could toy around with geothermal power more than we currently are, there's lots of things that we can do.

About a billion people in Africa and another billion in Asia thank you for reminding them how plentiful food is.

I dunno about food self-sufficiency in Africa, but I do know that both India and China are food self-sufficient. In fact, India is a net food exporter.

The mass hunger deaths in India are a thing of the past. The problem with the poor going hungry in India is because of the poor storage infrastructure and inefficient logistics and the fact that the said poor people cannot afford to buy the grains which are then allowed to rot and for rats to eat...


who's moralizing?

I was pointing to this...sorry it was not you..."The world only has so much natural resources and we are falling all over ourselves with greed at the prospects of increasing the living standards of 4 billion people(India and China). It will bite us."


I'm simply pointing out that they won't complete their experiments in industrialization because there will not be enough oil and there is no viable substitute.

There's coal for India. :eek: India has one of the largest reserves of coal. It is either nuke fuel from NSG or it is burn baby burn.


I'm all for it, but it won't work. Nuclear power is reliant on oil and there won't be enough and what there is will be too expensive and too low of a quality. Oil was a one shot deal and we're all about to wake up from the party with a massive hangover.

Explain "Nuclear power is reliant on oil "

Do you know about Thorium based reactors?

Explain "Nuclear power is reliant on oil "

Do you know about Thorium based reactors?
I think he's referencing the fact that mining the nuclear fuel requires petroleum powered machinery, and building the actual reactors would also require oil.

Of course, like I said earlier, why mine when you can pillage weapons stockpiles?

I think he's referencing the fact that mining the nuclear fuel requires petroleum powered machinery, and building the actual reactors would also require oil.

Of course, like I said earlier, why mine when you can pillage weapons stockpiles?

True, what the Indians are hoping with the proposed US-Indo nuke deal is that it will allow India to import dismantled Russian Pu nukes and use Pu to seed the Thorium reactors which can then become self-reliant because India also has the largest Thorium reserves. Atleast this is what I understand from reading many discussions on this issue...

Explain "Nuclear power is reliant on oil "

Do you know about Thorium based reactors?
Where do you get thorium? Where do you get the concrete and steel needed to build teh structures? How do you mine, smelt and transport the materials necessary to build a reactor? How do you mine, refine and transport the fuel? How do you move around the labor force necessary to build and operate the reactors? All commercial pesticides and fertalizers are manufactured out of fossil fuels. the average bite of food travelled 1,500 miles to make it to your plate and the average person consumes 10 calories of fossil fuel energy for every one calorie of food enery they consume. How do you feed the armies of workers necessary to maintain and expand and porduce the kind of massive nuclear power infrastructure needed to meet the expected enery demands of an industrialized China and India to say nothing of the rest of the world. You have to complete the full equation back to the beginning. You cannot build a nuclear power plant without cooling towers. You cannot build cooling towers without concrete. you cannot have concrete without massive open pit strip mining operations with tractors the size of small buildings and dump trucks big enough to haul multiple tons of sediment to refine the concrete from. You cannot build cooling towers without steel. You cannot have steel without massive mining and smelting operations that all run on oil. Once you have those you have to be able to transport the materials sometimes all over the globe. Whenever you think about these things you have to consider the costs of all inputs, not just the final result. How are all of these massive global mining operations going to work on $200/barrel oil? $300? $400?

Maybe.

Two things, though:

1. China remains somewhat protectionist, and this has ensured that they can control the flow of labor a lot better than in completely neoliberalized countries.

2. When wages start to rise significantly, if China doesn't loosen up the labor market more, capital will go elsewhere.

It's questionable if neoliberal globalization will ever create a middle class of Third World labor if it is not forced to, and if it does not, cheap labor will find itself eternally competing against itself both to attract capital and to sell goods cheaply enough to people in the First World. Comparing levels of population growth, this means that people in the Third World will see a more or less constant degradation of wages as they produce more goods for a market with a stable size. Because globalization will benefit some, the market will probably grow, actually (as it is in India and China) so things will hardly be apocalyptic, but it's still a losing game for what will almost certainly amount to a majority of the world's population.

Let's not forget that for the vast majority of China's population, the current growth isn't all that helpful, and in fact certain aspects of the reforms have caused considerable harm. If that's going to change, China is going to have to open up the labor market more, and that will only intensify the problems I referred to above.

Ultimately we are going to have to come up with some effective way of regulating the global economy, or else it is not going to solve anything for most inhabitants of most of the world. My preference is to expropriate multinationals and put them in the hands of the workers, but failing such extreme measures, globally ensuring decent wages and working conditions, and actually enforcing them, would be a good start.

Overall, the aim should be to work towards a global economy where "comparative advantage" amounts to something more than the place where corporations can best exploit everyone else.

COMMENTARY: When a country engages in international trade to the point where they begin to reach full employment and a considerable percentage of the population is now considered to be "middle class," trade will begin to flow to other countries where labor is more plentiful. In this slow but steady shift of manufacturing jobs, each economy touched winds up with much of the population benefitting. This is what is happening in China. It's essentially what happened in Japan after WWII.
Your thoughts?
My thoughts are that reality doesnt reflect your theory.
Which of these statements do you believe is true.
A) The per capita income of one third of the countries in the world has decreased since 1980
B)In 2003 1.2 billion people (one fifth of the world's population at that time) subsisted (or attempted to) on less than $1.00 per day.
C) The total assests of the world's three richest individuals exceeds the annual income of the poorest 600 million
D)In 1960 the richest 20% of the world's population had 30 times more income than the poorest 20%, in 2003 the ratio had risen to 74 to 1 and still rising...

A, B, C, & D

The facts simply do not match with your beliefs or the propaganda you appear to have swallowed in order to come to those beliefs.

Where do you get thorium? Where do you get the concrete and steel needed to build teh structures? How do you mine, smelt and transport the materials necessary to build a reactor? How do you mine, refine and transport the fuel? How do you move around the labor force necessary to build and operate the reactors? All commercial pesticides and fertalizers are manufactured out of fossil fuels. the average bite of food travelled 1,500 miles to make it to your plate and the average person consumes 10 calories of fossil fuel energy for every one calorie of food enery they consume. How do you feed the armies of workers necessary to maintain and expand and porduce the kind of massive nuclear power infrastructure needed to meet the expected enery demands of an industrialized China and India to say nothing of the rest of the world. You have to complete the full equation back to the beginning. You cannot build a nuclear power plant without cooling towers. You cannot build cooling towers without concrete. you cannot have concrete without massive open pit strip mining operations with tractors the size of small buildings and dump trucks big enough to haul multiple tons of sediment to refine the concrete from. You cannot build cooling towers without steel. You cannot have steel without massive mining and smelting operations that all run on oil. Once you have those you have to be able to transport the materials sometimes all over the globe. Whenever you think about these things you have to consider the costs of all inputs, not just the final result. How are all of these massive global mining operations going to work on $200/barrel oil? $300? $400?


You do realize that all that technology is oil based because oil is viewed as plentiful and cheap. Once that changes and oil lobbies lose power, alternative power techonologies, including vehicles, etc will be the ones getting all the funding and subsidies, then oil power will be expensive and unpractical. You are right that it is like that now, but it is all circumstancial, tis not by chance that oil giants buy off most renewable power patents and inflate their costs (eg photovoltaic panels). It allows them to remain viable without making apparent their inherent inefficiency.
The added costs are reconversion costs, of all the production and distribution chains, not absolute costs. A short term finite power source (estimates give oil at current consumption rates another 150 years, max, expect that rate to increase and it's even less) like oil is not a sound choice. Even money hungry, anti-tech oil CEOs will come round and reconvert their companies. Rather later than sooner mind you...

Yes! God bless you Eutrusca and God bless Convergence theory! It works, it always has and it always will! The US, Germany, Japan, South Korea, Taiwan, Singapore and now China are all demonstrating that populations do grow richer with industrialization!
Now, I'm all for free trade and all that, but you shouldn't generalise.

ConditionalConvergence holds true. Not total convergence.´

I feel obliged to post a link to an essay I wrote a while back (http://forums.jolt.co.uk/showthread.php?t=449512) about this very topic, with regards to Uganda. At the time it sounded okay, but I only got about 70% for it, so forgive any blatant stupidity showing.

Im interested to see what will happen to the Middle East when Oil tuns out they effectivly have no resources the rest of the world wants, unless of course you make a sand powered car:p

in theoryit become a group of proggresvily poorer group of warring states.

Does anyone know if the following statistic is correct

By 2030 Canada (Thats Right CANADA) will be exporting more oil than Saudi Arabia, if CAnada continues to exploit there reserves more.

Im interested to see what will happen to the Middle East when Oil tuns out they effectivly have no resources the rest of the world wants, unless of course you make a sand powered car:p
http://en.wikipedia.org/wiki/Dubai

There you have your answer. That goes for those who are smart - those who aren't are going to be in a world of trouble. And that means that the West will be too.

You do realize that all that technology is oil based because oil is viewed as plentiful and cheap.No. I thought all that texch is oil based because oil contains the net caloric equivalent of 2500 hours of manual labor per gallon.

Once that changes and oil lobbies lose power, alternative power techonologies, including vehicles, etc will be the ones getting all the funding and subsidies, then oil power will be expensive and unpractical."Alternative energies" have recieved enormous subsidies and have never been proven to be economical in an industrial setting because they take more energy to produce than you get from the process. You simply cannot compare, for example, the process of plowing acres and acres of soil, planting the biofuel crops, pumping the billions of acre feet of water to maintain your crops, harvesting, porcessing, transporting and finally rendering those crops into a lower quality fuel with poking a hole in the ground and having teh equivalent of 2500 hours of labor come shooting out every fraction of a second. ALL alternative energies require enormous inputs of energy in order to produce. In this way they are much less like oil and much more like a battery. They are energy carriers, not energy sources.


You are right that it is like that now, but it is all circumstancial, tis not by chance that oil giants buy off most renewable power patents and inflate their costs (eg photovoltaic panels). It allows them to remain viable without making apparent their inherent inefficiency.

That's bullshit. Its something you hear about a bars but doesn't hold true in reality. The reason energy companies have not participated in ethanol research, for example, is because they are private sector and nee to make a profit to survive and they recognize that to date no process or fuel can compete with fossil fuels in a straight bang for your buck match. Without government subsidies ethanol would be enormously expensive in comparison to oil. In fact, the only reason ethanol is cheap is because the government subsidizes teh oil it takes to grow, transport and render the ethanol into fuel. Ethanol is dependent on oil.

the fact is that energy companies will make money in way you can show them how and people are constantly trying to do that. If they see a market for ethanol they will jump in head first and start selling it. In fact, the largest solar power company in the world is Royal Dutch Shell. The reason you are finding more and more energy companies getting involved in "alternative" energies is because they recognize that cheap oil is over.

The added costs are reconversion costs, of all the production and distribution chains, not absolute costs. A short term finite power source (estimates give oil at current consumption rates another 150 years, max, expect that rate to increase and it's even less) like oil is not a sound choice. Even money hungry, anti-tech oil CEOs will come round and reconvert their companies. Rather later than sooner mind you...
150 years? You live in a dream world. We won't be using oil as a primary energy source in 20 years and it will not be replaced by a comparable one because there isn't a comparable one.

150 years? You live in a dream world. We won't be using oil as a primary energy source in 20 years and it will not be replaced by a comparable one because there isn't a comparable one.

Dunno. This looks like it might work.

http://www.keelynet.com/energy/waterfuel.htm

What's your analysis?

Ha Ha, serves you right Big Money, they're going to keep shifting production around until they find a new Bottom class in another nation to exploit.

Dunno. This looks like it might work.

http://www.keelynet.com/energy/waterfuel.htm

What's your analysis?
I'd have to research more but I'm sure its bullshit or someone, somewhere in the world would be massproducing these conversion kts or engines. Rightoff the bat I can tell you that h2 makes metal brittle so if a normal car battery could turn water in your tank to h2 you'd have to replace the rest of your car because in short order your engine would break down. Also, h2 leaks out of existing natural gas and fuel lines in existing industrial pipelines because the molecule is so small so I'm sure your standard fuel lines woudl not be able to hold the h2 long enough to actually deliver it to your combustion chambers. If tactical Grace sees this you'll probably get a better answer than I can give. Suffice it to say that I have never seen one of these energy technologies that actually pan out when put to the test. There are two sayings that matter here:

There ain't no such thing as a free lunch.
If it's too good to be true it probably isn't.

Photovoltaics are expensive because they are semiconductors. Semiconductor plants are extremely expensive, and extremely energy intensive. It is the nature of the technology that is the problem, not an uber omfg conspiracy.

Speaking of conspiracies, oil companies suppressing renewable energy technologies is bullshit. Renewables can't compete on the battlefield of infrastructure, thermodynamics and public opinion. You want to build offshore wind farms? Tough shit. The people on the coast vote and exercise a veto. You want to build geothermal? Try generating enough electricity to run the pump that injects the water. You want to plug electric cars into the grid? Try doing it so it doesn't melt after rush hour.

If there was a way of making renewable energy technology work, we would have made more progress by now. And frankly, it's the attitude that 1973 and 1980 were scaremongering that lost us 30 years of time in which to do something.

People have been looking for substitutes for a while, actually. During the entire 20th century, we managed to add only nuclear to the list, and the rest of the list couldn't be made to work. The revealing thing is that energy infrastructure is built with a 40 year lifetime in mind, and the stuff being built now is now is just variations on the same old themes. It means the innovation has already failed to deliver anything new for our generation.

Their economy will collapse because they will not be able to find that much oil on world markets and the price for the oil they do consume will be astronomical.
And the man or woman who invents an alternative energy souce will become wealthy beyond any dreams of avarice. :)

Yeah, well, their industrialization is going to be cut short coming up here real quick.
One of the cardinal virtues of humans is that they always seem to find a way. :)

Dan, you've bought into the Peak Oil scare, haven't you? While there is some logic to what they say, their arguments are flawed. For instance in...Missouri, I believe...the state government has pushed forward with incredibly efficient coal-fired plants that have for all intents and purposes no pollutants, and provide much more power than your typical coal-fired plant. Such technology is being worked upon and advanced each and every day. It would most assuredly be feasible to plan around the oil shortage until one has implimented enough of such efficiency-building technology to where there is no oil shortage again because it is used so efficiently, along with other fossil fuels. Meanwhile we continue to work on alternative energy sources to where they can fully take over once even the most efficient fossil fuel using plant will no longer be feasible. It's taking time, but it will happen. Quit being so pessimistic. Civilization will not collapse. At worst, it will slow down for a short while.

Yes! God bless you Eutrusca and God bless Convergence theory! It works, it always has and it always will! The US, Germany, Japan, South Korea, Taiwan, Singapore and now China are all demonstrating that populations do grow richer with industrialization!
[ feels all properly blessed ] :D

This is true. If you truly want to "help" people in third world poverty, send them a micro-loan so they can start a little business. This has been shown to be the most effective way of getting people out of poverty: give them the means of getting out through their own initiative.

One of the cardinal virtues of humans is that they always seem to find a way. :)
Hi, I'm one of the people charged with finding a way. Pleased to meet you. I'll let you know how we're doing in 5 years or so. In the meantime, start experimenting with public transport. :p

About a billion people in Africa and another billion in Asia thank you for reminding them how plentiful food is.
There is more than enough food worldwide to feed every human being on the planet. The problem is largely infrastructural, not agricultural.

Hi, I'm one of the people charged with finding a way. Pleased to meet you. I'll let you know how we're doing in 5 years or so. In the meantime, start experimenting with public transport. :p
Go for it, dude! Let me know how I can help. :D

Hi, I'm one of the people charged with finding a way. Pleased to meet you. I'll let you know how we're doing in 5 years or so. In the meantime, start experimenting with public transport. :p
Really? Care to enlighten us as to what you do? I'd be interested in seeing how such attempts are going from a personal perspective rather than just press releases and the like.

Eut: That, and scare tactics from assholes like Greenpeace when it comes to genetically engineered food. Many African countries refuse to take such food despite the fact that it's just as safe as any other food. The only difference is the amount one can harvest.

Dan, you've bought into the Peak Oil scare, haven't you? While there is some logic to what they say, their arguments are flawed. For instance in...Missouri, I believe...the state government has pushed forward with incredibly efficient coal-fired plants that have for all intents and purposes no pollutants, and provide much more power than your typical coal-fired plant. Such technology is being worked upon and advanced each and every day. It would most assuredly be feasible to plan around the oil shortage until one has implimented enough of such efficiency-building technology to where there is no oil shortage again because it is used so efficiently, along with other fossil fuels. Meanwhile we continue to work on alternative energy sources to where they can fully take over once even the most efficient fossil fuel using plant will no longer be feasible. It's taking time, but it will happen. Quit being so pessimistic. Civilization will not collapse. At worst, it will slow down for a short while.
Exactly! Good analysis. Thank you. :)

On a side note, this is hilarious:

Originally Posted by Vittos Ordination2
I angered Eut by comparing him to my 6-month Christmas tree, so I think I am out.

:D

One of the cardinal virtues of humans is that they always seem to find a way. :)
Unfortunately, most times that way tends to involve massive bloodshed and/or oppression.

Go for it, dude! Let me know how I can help. :D
Write to your political representatives and tell them that people who object to wind turbines on the grounds that they "spoil the view" are dumbasses. :rolleyes:

And leave the car in the garage.

And the man or woman who invents an alternative energy souce will become wealthy beyond any dreams of avarice. :)
And yet they havn't.
One of the cardinal virtues of humans is that they always seem to find a way. :)
Not true. History is rife with examples of humans who's civilizations have gone extinct and who have suffered enormous tragedy as a result of resource depletion, natural disaster or economic collapse. Look at Africa and Asia right now. Are farmers in Dafur "finding a way?" Are people in refugee camps in Laos "finding a way?" You position in either N.A. or Europe leaves you feeling invincible because you are used to living in the Age Of Oil. Most people don't live there.


Dan, you've bought into the Peak Oil scare, haven't you? While there is some logic to what they say, their arguments are flawed. For instance in...Missouri, I believe...the state government has pushed forward with incredibly efficient coal-fired plants that have for all intents and purposes no pollutants, and provide much more power than your typical coal-fired plant. Such technology is being worked upon and advanced each and every day. It would most assuredly be feasible to plan around the oil shortage until one has implimented enough of such efficiency-building technology to where there is no oil shortage again because it is used so efficiently, along with other fossil fuels. Meanwhile we continue to work on alternative energy sources to where they can fully take over once even the most efficient fossil fuel using plant will no longer be feasible. It's taking time, but it will happen. Quit being so pessimistic. Civilization will not collapse. At worst, it will slow down for a short while.
None of those coal fired plants have even been built yet beyond prototypes, first. Second, the old adage that the world has 200 years worth of coal at present rates is true. At present rates. When we suddenly have to substitute it for oil and when you calculate industrialization and growth for about 4 billion people in Asia, NA and Eruope, to say nothing of Africa and SA, you suddenly have a LOT less coal.

That, and scare tactics from assholes like Greenpeace when it comes to genetically engineered food. Many African countries refuse to take such food despite the fact that it's just as safe as any other food. The only difference is the amount one can harvest.
Greenpeace is a good "thorn-in-the-side" organization. It serves to remind us of things we would rather forget.

As to the use of genetically engineered crops, they worry me. The bio-sphere constantly exchanges genetic information amongst its quadrillions of individual members. Any genetic manipulation will also be exchanged. All I can say is that geneticists had better be damned certain that other species won't be detrimentally affected before they introduce changes.

Not true. History is rife with examples of humans who's civilizations have gone extinct and who have suffered enormous tragedy as a result of resource depletion, natural disaster or economic collapse. Look at Africa and Asia right now. Are farmers in Dafur "finding a way?" Are people in refugee camps in Laos "finding a way?" You position in either N.A. or Europe leaves you feeling invincible because you are used to living in the Age Of Oil. Most people don't live there.
This is called "learning from hard experience." The human race is noted for closing the barn door after the horse has escaped. As we move by fits and starts toward a global economy, the impact of this will become greater and greater. We will have to learn to anticipate rather than simply react, or we're going to be in serious trouble.

Greenpeace is a good "thorn-in-the-side" organization. It serves to remind us of things we would rather forget.

As to the use of genetically engineered crops, they worry me. The bio-sphere constantly exchanges genetic information amongst its quadrillions of individual members. Any genetic manipulation will also be exchanged. All I can say is that geneticists had better be damned certain that other species won't be detrimentally affected before they introduce changes.
I absolutely agree. Thing is, what Greenpeace and others would have you believe is that geneticists are just screwing around at random, with no real testing. As a matter of fact, GE food is tested almost at a higher level than most medications, let alone most foods.

And of course it's funny. That's why it's in my sig.

Dan: Hence why we don't focus on just one thing. You seem to believe we're incapable of multitasking. Do some more research. I actually did buy into the Peak Oil scare for a little while before realizing that they haven't fully done their research. I'm not saying there won't be problems. I am, however, saying that you are being far too pessimistic and uninformed when it comes to our ability to get beyond such problems.

Write to your political representatives and tell them that people who object to wind turbines on the grounds that they "spoil the view" are dumbasses. :rolleyes:

And leave the car in the garage.
Don't own one.

And my Congressperson is sick of my constant calls. :)

This is called "learning from hard experience." The human race is noted for closing the barn door after the horse has escaped. As we move by fits and starts toward a global economy, the impact of this will become greater and greater. We will have to learn to anticipate rather than simply react, or we're going to be in serious trouble.
And I hope you don't rtake this too harshly, but you and others in this thread are proof that we have not learned to anticipate. As a species we are still living in the reactive rather than the proactive.

"Don't worry. The Market and Human Enginuity will take care of it."

I doubt it. I think the crisis will hit and all the polyanna talk will cease and everyone will say, "Oh, shit."

This crisis is going to be worse than any in human memory.

There is wearing rose-tinted glasses, Dan, and then there's realism. You, however, seem to be wearing grey-tinted glasses. Take them off, and realize that while obviously humans are nowhere near perfect, we do have the amazing ability to learn and adapt. Now see, I'm not too worried about it either way because I can't do anything about it. I don't plan on going into any fields that would affect the situation one way or the other, and as such, I don't feel the need to worry. What will happen will happen. And I, unlike you, am going to be realistic, not pessimistic.

I do hope you realize that I'm not trying to attack you personally here. I'm merely trying to show you that you need to open your mind just a little bit more.

Really? Care to enlighten us as to what you do? I'd be interested in seeing how such attempts are going from a personal perspective rather than just press releases and the like.
I work in the exciting field of energy infrastructure. I chose it because I knew that it would be an 'interesting' place to be in the years to come.

Basically when you build something, it's going to sit there for 40 years before obsolescence. I have a pretty clear view of what the industry worldwide is capable of building right now. It's the same old stuff, big, centralised, etc. Advances in computing give you greater control, but ultimately our energy systems are going to retain their current form until the middle of the century. You can't argue with purpose-built factories and bulk buy orders for stuff that lasts that long. It's big cash, it's already getting spent, and there is nothing new on the horizon.

The thing is, what we know about future energy availability is at odds with what I know about our technological capability. What we are going to have in 2010-2020 won't run on what will be available 2010-2020. It just doesn't add up.

A great example is the UK electrical energy generation mix:

- North Sea oil/gas production falling at 7%+ annually since 1999, 10% last year
- Energy self-sufficiency ceased in 2005
- Gas turbine share of generation rising from 45% to 60%+ by 2020
- Nuclear share of generation falling from 20% to 5% by 2020
- North Sea production by 2020: negligible

Really if you know what is going to be up and running on the ground by then, and what you can get built by then, you know you are well and truly fucked. The annoying thing is, people shrug aside stats like these and say "Oh they'll think of something, they always do", not realising how long it takes to build it even if you have thought of it already.

This is called "learning from hard experience." The human race is noted for closing the barn door after the horse has escaped. As we move by fits and starts toward a global economy, the impact of this will become greater and greater. We will have to learn to anticipate rather than simply react, or we're going to be in serious trouble.
You get a tentative applause for this - what was once a behavioural quirk is one hell of a scary problem for us now. Civilisations die of procrastination and denial.

I work in the exciting field of energy infrastructure. I chose it because I knew that it would be an 'interesting' place to be in the years to come.

Basically when you build something, it's going to sit there for 40 years before obsolescence. I have a pretty clear view of what the industry worldwide is capable of building right now. It's the same old stuff, big, centralised, etc. Advances in computing give you greater control, but ultimately our energy systems are going to retain their current form until the middle of the century. You can't argue with purpose-built factories and bulk buy orders for stuff that lasts that long. It's big cash, it's already getting spent, and there is nothing new on the horizon.

The thing is, what we know about future energy availability is at odds with what I know about our technological capability. What we are going to have in 2010-2020 won't run on what will be available 2010-2020. It just doesn't add up.

A great example is the UK electrical energy generation mix:

- North Sea oil/gas production falling at 7%+ annually since 1999, 10% last year
- Energy self-sufficiency ceased in 2005
- Gas turbine share of generation rising from 45% to 60%+ by 2020
- Nuclear share of generation falling from 20% to 5% by 2020
- North Sea production by 2020: negligible

Really if you know what is going to be up and running on the ground by then, and what you can get built by then, you know you are well and truly fucked. The annoying thing is, people shrug aside stats like these and say "Oh they'll think of something, they always do", not realising how long it takes to build it even if you have thought of it already.

So, what will happen then? What is your professional opinion? Will civilization collapse, as Dan would have us believe? Will we somehow pull a rabbit or twelve out of our collective hats and be all peachy? Or will something in between occur?

I absolutely agree. Thing is, what Greenpeace and others would have you believe is that geneticists are just screwing around at random, with no real testing. As a matter of fact, GE food is tested almost at a higher level than most medications, let alone most foods.

And of course it's funny. That's why it's in my sig.You mean all that corn that got tested and grown with all those agro-petro chemical fertalizers and pesticides? If it produces twice as much it nees twice as much to grow. They work here in the US because we soak our ground in oil based pesticides and natural gas based fertalizers. Farmers in Darfur don't have those.

Dan: Hence why we don't focus on just one thing. You seem to believe we're incapable of multitasking. Do some more research. I actually did buy into the Peak Oil scare for a little while before realizing that they haven't fully done their research. I'm not saying there won't be problems. I am, however, saying that you are being far too pessimistic and uninformed when it comes to our ability to get beyond such problems.
As to my research I do nothing all day except read about energy and not from Peak Oil scare sites but from the Oil and gas Journal and other energy publications. I watch the oil and gas reports that come out every week on Wed and Thur at 7:30 AM PST from the DOE. I do google searches on every "alternative" energy scheme I come across. In fact in between posts I've been looking at site after site about "waterfuel" because of that one post in this thread. I research all day everyday and put my money where my mouth is because I invest heavily in energy and energy services stocks. I think you need to do more research. If you have, then don't tell me that "human enginuity" will save the day. Tell me abot an actual solution that you see. Are you an Ethanol fan? Do you think solar will save the day? Can you explain to me how any of these technologies will work in an oil scarce world? How do yo actually see us solving the problem of fossil fuel depletion, because believe me I look for solutions every day and I don't see one that involves us keeping the standard of living that we have grown accustomed to.

Also, there are a lot of people who have done a lot more research than me, Tactical Grace, who I believe is an engineer in theenergy industry, is one of them and the only people who seem to think the Market and Human Enginuity will solve the problem are classical economists who have no respect for the word "finite."

So, what will happen then? What is your professional opinion? Will civilization collapse, as Dan would have us believe? Will we somehow pull a rabbit or twelve out of our collective hats and be all peachy? Or will something in between occur?
I never said civilization will collapse, in fact I think you'll find TG to be a little more pessimistic than I. I think like oil itself the future is a bell curve. Can I predict what will happen? Of sorts. I predict that the futrue will fall somewhere between the real possibility that we will go extinct and that Peak Oil will flow undr us ike a wave under a boat without is knowing it. The most likely probability, as with all bell curves or probability, is somewhere in the middle. What you need to understand is that somewhere in the middle of complete annhililation and nothing happening is REALLY FUCKING BAD! In the middle does not inlcude our current level of prosperity. In the middle does not include the billions of people now alive. In the middle is not relative peace and political stability.

What's also interesting to note is that if we want to pull the outcome closer to the good side of the bell curve it requires us all to first recognize what is happening and the gravity of it and second to, as a society, react quickly and with single mindedness. This thread is proof that that is not happening yet.

So, what will happen then? What is your professional opinion? Will civilization collapse, as Dan would have us believe? Will we somehow pull a rabbit or twelve out of our collective hats and be all peachy? Or will something in between occur?
Something in between.

Voltage regulation and rotating blackouts as a way of life, decline in power quality forcing redesigns of computer and medical equipment, shift of focus to regional rather than global trade, massive recession and a multitude of resource wars. We may see the re-emergence and popular success of politics which openly embraces resource conquest. In terms of quality of life, the US and EU will get the post-USSR Russia experience, for the long term, and I'm talking the same sort of timescales - decades. In a world of plenty, Russia has not repaired itself after 15 years of trying, and in a harsher world, we won't either. This is probably the most accurate comparison we have.

I doubt we will end up in a post-apocalyptic world of every man for himself. It didn't happen when the Soviet Union imploded, and it is a rare conclusion to any historical decline and fall of civilisation.

Beyond that it's all speculation. But be definitely won't save ourselves the trouble I describe, the facts on the ground are such that it is inevitable.

Something in between.

Voltage regulation and rotating blackouts as a way of life, decline in power quality forcing redesigns of computer and medical equipment, shift of focus to regional rather than global trade, massive recession and a multitude of resource wars. We may see the re-emergence and popular success of politics which openly embraces resource conquest. In terms of quality of life, the US and EU will get the post-USSR Russia experience, for the long term, and I'm talking the same sort of timescales - decades. In a world of plenty, Russia has not repaired itself after 15 years of trying, and in a harsher world, we won't either. This is probably the most accurate comparison we have.

I doubt we will end up in a post-apocalyptic world of every man for himself. It didn't happen when the Soviet Union imploded, and it is a rare conclusion to any historical decline and fall of civilisation.

Beyond that it's all speculation. But be definitely won't save ourselves the trouble I describe, the facts on the ground are such that it is inevitable.

I still find this hard to believe, but that just may be a denial-of-the-truth type of response here. I'm only nineteen. I still have a full life ahead of me. I wouldn't want the world to be like this. =/

I still find this hard to believe, but that just may be a denial-of-the-truth type of response here. I'm only nineteen. I still have a full life ahead of me. I wouldn't want the world to be like this. =/
I was 18 when I had it explained in a univeristy engineering lecture, and since then I have accepted it as the way things are. It is the everyday watercooler chat reality of the energy industry. Just draw strength from the thought that for some it has already happened and tens of millions of Russians struggle on. As in time we will learn to do also. :p

I still find this hard to believe, but that just may be a denial-of-the-truth type of response here. I'm only nineteen. I still have a full life ahead of me. I wouldn't want the world to be like this. =/
I didn't either, but as Matt Savinar says, "Deal with reality or reality will deal with you."

I got my original BA in film. I have since gone back to school and am now getting a degree in geology and chemistry and will go on to get MS's in realted subjects. Read a lot, I mean a lot, and then rethink your life. You're right it doesn't need to be too bad for you, but you will be far better off in the future if you are necessary.

On a side note it should be scary that TG and I posted almost identical predictions for the future completely by accident and at the same time. It says something that a scare mongerer like me gets supported by accident from a person in a position to know a lot more about all this than I do.

Well, we'll see how things pan out then. In the meantime, I think I'll just live my life like I always have. No reason to change overnight, eh?

Well, we'll see how things pan out then. In the meantime, I think I'll just live my life like I always have. No reason to change overnight, eh?
Well, I don' mean this personaly either, but that's probably what a lot of extinct civilizations thought. Its true that as a society, the earlier we take action the better. Its true on a personal level, too. The fact is, out of absolute catasrophy arises great opportunity. You may find yourself better off than you could ever believe if you take advantage of the opportunities knowledge like this can give you, especially at 19.

Well, we'll see how things pan out then. In the meantime, I think I'll just live my life like I always have. No reason to change overnight, eh?
It is debatable to what extent there is any point in making lifestyle changes. The party won't end just because you leave early. Just be sure to take a long view and get yourself into a position where you can survive the changes. For example being an essential worker rather than just another arts grad with debts and no direction.

It is debatable to what extent there is any point in making lifestyle changes. The party won't end just because you leave early. Just be sure to take a long view and get yourself into a position where you can survive the changes. For example being an essential worker rather than just another arts grad with debts and no direction.

Art's grad? Clarification please.

Some of the best computer people I have known have music degrees........

Well, I did intend to go into the field of education. Perhaps I should change off from history to more general education. Unless that would be a bad choice. I'd still rather do something I'm interested in than something I'm not just for the sake of what could happen. =/

Art's grad? Clarification please.

Some of the best computer people I have known have music degrees........
In the future I think they'll be using their comp knowledge a lot more than their music knowledge unless they're Mozart reincarnated. It happened to me, too, sort of. I have a film degree and i work on comps all day. Of course, i work on comps digitizing media and moving big files for TV and movies around the world.

Art's grad? Clarification please.

Some of the best computer people I have known have music degrees........
There are always exceptions. :p

But I think most people would understand what I'm talking about. The great majority of young people who end up in a "Hmm...now what? I know, I'll spend a couple of years doing casual jobs and getting drunk" position.

Just found this. It's an open letter so I'll just post the whole thing. It's from a petroleum geologist to the two largest newspapers in Texas.

April 2, 2006


Mr. Wesley R. Turner, President & Publisher
Fort Worth Star Telegram

Mr. James H. Moroney , III, Publisher & CEO
The Dallas Morning News

Subject: What Are Two Texas Billionaires,
Richard Rainwater & T. Boone Pickens,
Saying About Peak Oil & Why Aren’t You Listening?

Gentlemen:

I realize that I don’t have to introduce Richard Rainwater and Boone Pickens to you two gentlemen, but for the benefit of those who may not be familiar with Messrs. Rainwater and Pickens, following are brief introductions.

Richard Rainwater is the Texas based businessman who was chiefly responsible for turning the Bass Family’s inheritance of $50 into a $5 billion dollar fortune. Mr. Rainwater was therefore indirectly responsible for the remarkable urban renaissance of downtown Fort Worth, as a result of the Bass family’s massive investments. Mr. Rainwater also had a material role in George W. Bush’s selection as Managing Partner of the Texas Rangers Baseball Team, which launched Mr. Bush on his way to the Governor’s Mansion and then to the White House.

Mr. Pickens, now based in Dallas, has had a long and storied career in the oil and gas industry. Like most Texas oilmen, Mr. Pickens has had his ups and downs. Most recently he has been on an up cycle, via his investment firm, BP Capital.

These two gentlemen share an uncanny and proven ability to accurately predict future trends. The only real mistake that I am aware of is Mr. Pickens’ timing regarding natural gas prices some years ago. He was right about the price move, but he was just a little early.

Mr. Rainwater was profiled in the 12/14/05 issue of Fortune Magazine, “The Rainwater Prophecy.” Mr. Rainwater is deeply concerned about Peak Oil. In the article, Mr. Rainwater said, “This is the first scenario I’ve seen where I question the survivability of mankind.” Mr. Rainwater first became concerned about Peak Oil after reading “The Long Emergency” by James Howard Kunstler.

According to Bill McKenzie, with the Dallas Morning News, the primary reason that President Bush used the “Addicted to OIl” phrase in his state of the Union Speech was the Fortune article about Richard Rainwater, and again Mr. Rainwater became concerned about Peak Oil after reading Mr. Kunstler’s book.

On November 1, 2005 the Greater Dallas Planning Council and the Southern Methodist University Environmental Sciences Department cosponsored a symposium featuring Mr. Kunstler and Matthew R. Simmons entitled “The Unfolding Energy Crisis and its Impact on Development Patterns.” Mr. Pickens, via BP Capital, was one of the lead underwriters of the event.

Mr. Pickens, several of his associates, and several other notable Dallas businessmen such as Herbert Hunt were at the Simmons/Kunstler symposium, but no one from your respective editorial and news departments were able to make the event--despite multiple notices of the event.

In any case, Mr. Pickens has publicly stated that he believes that the world is at peak oil production. Mr. Pickens has publicly suggested increasing the gasoline tax, in an attempt to reduce oil consumption, with offsetting tax cuts elsewhere.

I certainly don’t speak for either Richard Rainwater or Boone Pickens, but my impression of these two gentlemen--along with Matt Simmons and Jim Kunstler--is that they are American patriots, in the truest sense of the word, who are trying to warn their fellow Americans about the dangers posed by Peak Oil.

In the Fortune interview, Mr. Rainwater was quoted as follows, “I believe in Hubbert’s Peak. I came out of Texas. I watched oil fields reach peak and go over, and I’ve watched how people would do all they could, put whatever amount of money into the field, and they couldn’t do anything about it.”

Much of the Peak Oil debate is based on pioneering work done by a famous Texas born geoscientist, M. King Hubbert. My coauthor, “Khebab,” and I wrote an article that was published on the Energy Bulletin website, “M. King Hubbert's Lower 48 Prediction Revisited: What can 1970 and Earlier Lower 48 Oil Production Data Tell Us About Post-1970 Lower 48 Oil Production?” Following is an excerpt from that article.

Fifty years ago this week, on March 8, 1956, at a meeting of the American Petroleum Institute in San Antonio, Texas, M. King Hubbert, in the preprinted version of his prepared remarks, had the following statement, "According to the best currently available information, the production of petroleum and natural gas on a world scale will probably pass its climax within the order of a half century (i.e., by 2006), while for both the United States and for Texas, the peaks of production may be expected to occur with the next 10 or 15 years (i.e., 1966 to 1971)." As more and more people are learning, Lower 48 oil production, as predicted by Dr. Hubbert, peaked in 1970, and it has fallen fairly steadily since 1970.

Kenneth Deffeyes, in Chapter Three of his recent book, "Beyond Oil: The View From Hubbert's Peak," described a simplified way of predicting the production peaks for various regions and for their subsequent declines. One simply plots annual production (P) divided by cumulative production to date (Q) on the vertical axis, or P/Q, versus Q on the horizontal axis. Stuart Staniford, on The Oil Drum Blog, has described this technique as "Hubbert Linearization" or HL.

With time, a HL data set starts to show a linear progression, and one can extrapolate the data down to where P is effectively zero, which gives one Qt, or ultimate recoverable reserves for the region. Based on the assumption that production tends to peak at about 50% of Qt, one can generate a predicted production profile for the region. The Lower 48 peaked at 48.5% of Qt.

Using the HL technique, Dr. Deffeyes, an associate of Dr. Hubbert, predicted that the world crossed the mathematical 50% of Qt mark on December 16, 2005. In other words, Dr. Deffeyes believes that the world is now where the Lower 48 was at in the early Seventies.

We used the HL method to predict post-1970 Lower 48 cumulative oil production, using only 1970 and earlier production data. Our work indicated that the HL method was 98.7% accurate in predicting post-1970 Lower 48 cumulative oil production.

We need to differentiate between conventional and nonconventional oil. Perhaps the best way to differentiate the two types of oil is to classify it the following way. Conventional--the oil will move to a wellbore on its own. Nonconventional--the oil and oil-like solids have to be surface mined or heated in order to move to a wellbore (or synthesized from lighter hydrocarbons).

Dr. Deffeyes estimates that we that we have two trillion barrels of recoverable conventional oil reserves worldwide and that we have used half of this amount.

Fossil fuels can be viewed as a continuum, from natural gas, to natural gas liquids, to condensate, to light sweet crude oil to heavy sour crude oil to bitumen to coal. (Kerogen, a precursor to bitumen, can also be processed to yield oil.) This list is a progression from gas, to liquid to solid. It is also a progression from cleanest, natural gas, to dirtiest, coal.

The world wants Liquid Transportation Fuels (LTF’s)--gasoline, diesel and jet fuel. LTF’s can be obtained for the least expenditures of energy and capital from light sweet crude. It only makes sense that light sweet crude will peak before heavy sour, and based on the current historically high spreads between light sweet crude and heavy sour crude, that appears to be the case.

The world is increasingly turning toward the endpoints--natural gas/natural gas liquids on the light end and bitumen/coal on the heavy end--in an attempt to maintain and increase our supply of LTF’s. There are several problems. These are hugely capital intensive programs that tend to produce liquids at very low rates compared to conventional oil sources, and on the heavy end there are some fairly severe environmental consequences. Another point that is often overlooked is that every fossil fuel resource, except for kerogen, is currently being commercially exploited. In other words, we are simply talking about increasing our rate of extraction of our finite fossil fuel resource base in a desperate attempt to maintain the current American way of life of driving $50,000 SUV’s on 50 mile roundtrips to and from $500,000 mortgages.

Currently, the most significant source of nonconventional oil is the tar sands play in Alberta, Canada, where bitumen is being extracted via surface mining or via the injection of steam into deeper beds.

From fossil fuel and nuclear sources, the world currently uses the energy equivalent of a billion barrels of oil (Gb) every five days. The mighty East Texas Oil Field, the foundation of so many Dallas fortunes, the largest oil field in the Lower 48, and the field that was largely responsible for providing the oil to power the Allies victory over the Axis powers in World War II, made about 5.5 Gb. The field is currently producing 1.2 million barrels of water per day, with a 1% oil cut. It took about 75 years to pretty much fully deplete the East Texas Field. In terms of oil equivalent, the Barnett Shale Gas Play in North Texas should ultimately produce, over several decades, on the order of 4-5 Gbe.

The world uses, from nuclear and fossil fuel sources, the energy equivalent of the recoverable reserves in the East Texas oil Field or the Barnett Shale Play in less than 30 days.

In the 4/2/06 Star Telegram, Automotive Journalist Ed Wallace, in the classified advertising section, wrote a rebuttal to the Peak Oil theories. Mr. Wallace’s two basic points: (1) improved technology will increase recoverable conventional reserves by 50% to 3,000 Gb and (2) nonconventional oil sources will add another 3,000 Gb. Therefore, based on Mr. Wallace’s estimates, we have used 1,000 Gb out of a 6,000 Gb resource base.

In the Viewpoints (Op-Ed) section of the Dallas Morning News, similar “cornucopian” energy abundance articles were published last year making basically the same points that Mr. Wallace made.

In regard to the technology issue, this assertion is directly contradicted by our experience in Texas (peaked at 54% of Qt), the overall Lower 48 (peaked at 49% of Qt) and the North Sea (peaked at 52% of Qt). Nothing the industry has tried in these regions has reversed the production declines once about half of the oil reserves were consumed. The reason is best illustrated by the East Texas field, now producing water with a 1% oil cut. What can better technology do to help a field that has watered out?

In regard to the nonconventional sources of oil, Mr. Wallace is primarily focused on the Canadian tar sands and shale oil (kerogen). The tar sands play is a proven commercial success, that is however hugely energy intensive and that is also yielding vast amounts of contaminated waste water. Mr. Wallace cites the most widely used estimate of 175 Gb in recoverable reserves (note that this should be discounted by about 35% to 50% to get net energy equivalent). He also cited a vague estimate by a Shell executive of 2,000 Gb, that can’t be currently recovered. There is one interesting research program testing some new shale oil technologies, but there is nothing commercial yet.

In any case, let’s look at past and current estimates of Canadian tar sands production. In 2003, the US Energy Information Agency (EIA) estimated that total Canadian oil production--driven by increasing tar sands production--would increase by 700,000 BOPD from 2003 to 2005. The reality? Total Canadian oil production fell from 2003 to 2005. The tar sands production fell short of estimates, and the increasing tar sands production the Canadians had could not make up for the decline in conventional Canadian oil production.

The Canadians themselves are estimating that tar sands production will only increase to about three million BOPD (mbpd) in 2016 from one mbpd today. Note that we will probably start losing a net two mbpd to four mbpd in conventional oil production per year, starting this year. Again, note that you have to discount the tar sands production by 35% to 50% to get net energy.

In effect, Mr. Wallace, and the other energy cornucopians see no problem with the $50,000 Hummer, $500,000 mortgage way of life.

Messrs. Rainwater and Pickens disagree. I can’t speak for them, but I assume that they believe that while nonconventional oil will help, it will only serve to slow the rate of decline of total oil production.

Some types of ethanol production (not from corn sources) appear have some possibilities, but there are a number of problems. Among the problems is a basic conflict between land devoted to food production and land devoted to fuel production. By the way, the US is probably now a net food importer. Currently, the US uses up to 10 calories of fossil fuels to produce one calorie of food. Ponder the impact on our food supply of a declining oil supply.

I realize that US media companies are facing severe economic pressures, and I realize that you are heavily dependent on advertising revenues from the housing/auto industries and from related companies. However, in my opinion we have hit the iceberg. The US media can lash themselves to the sinking ship, by failing to face reality, or you can face the reality of finite energy resources and start heading for the lifeboats.

I am supporting a proposal to abolish the Payroll (Social Security + Medicare) Tax and to replace it with an energy tax, principally a tax on liquid transportation fuels. This would unleash powerful economic forces against profligate energy use. Since it is in effect a consumption tax, it would tax those who currently don’t pay the Payroll Tax, by using cash. Instead of taxing payrolls to fund the Social Security and Medicare systems, we would instead tax energy consumption.

Alan Drake, a consulting engineer, has written a compelling article advocating a crash program of electrifying our transportation system, with special emphasis on Urban Rail.

I am working with a small group regarding the possibility of a Fall symposium on the Energy Tax and Urban Rail proposals, and we would be delighted to have support from The Fort Worth Star Telegram and/or The Dallas Morning News.

Note that these two proposals would address: the Social Security/Medicare crisis; the Peak Oil crisis; the loss of farmland due to suburban sprawl and Global Warming issues. We would replace “dumb growth” with “smart growth,” New Urbanism projects along mass transit lines.

In addition, I would at least ask you to give your readers a balanced report on the Peak Oil issue. Two leading citizens of your respective cities--Richard Rainwater and T. Boone Pickens--are deeply concerned about Peak Oil. The stated mission of the Fort Worth Star Telegram is: “Earning the People’s Trust Daily.” I assume that the Dallas Morning New concurs with this mission statement.

In my opinion, the US media have two choices regarding the Peak Oil issue. To paraphrase Winston Churchill, you can now have either your honor or the status quo. If you do nothing regarding Peak Oil, you will soon have neither the status quo nor your honor.

Sincerely,


Jeffrey J. Brown

Jeffrey J. Brown is an independent petroleum geologist in the Dallas area. He can be contacted at westexas@aol.com .

In the future I think they'll be using their comp knowledge a lot more than their music knowledge unless they're Mozart reincarnated. It happened to me, too, sort of. I have a film degree and i work on comps all day. Of course, i work on comps digitizing media and moving big files for TV and movies around the world.

It's arguable. There is cheap computer labor offshore. I seriously don't advise younger kids to look at computer science as a degree. Especially, with what I see companies doing these days. We are hiring like crazy. In India. We created 40 positions there. Laid off 23 here and added 2. We are probably going to create another 30 there. And probably 3 more here.

Computers aren't safe jobs anymore especially with the rise of high speed WANS and apps like webex.

BTW - I just read what Mr. Chavez is actually proposing. He's not talking about locking in a $50.00 ceiling. He's talking about locking in a $50.00 floor. If oil goes to $400/barrel then it will still cost $400.00/barrel, but the market will not be able to drop it uder $50.00 under Mr. Chavez's plan.

The market isn't able to drop it under $50 / barrel already, so I don't see what his point is. Much of what Chavez says is either for internal or external consumption but not both, with some unclear aim in mind.

BTW - I just read what Mr. Chavez is actually proposing. He's not talking about locking in a $50.00 ceiling. He's talking about locking in a $50.00 floor. If oil goes to $400/barrel then it will still cost $400.00/barrel, but the market will not be able to drop it uder $50.00 under Mr. Chavez's plan.

As I recall he said that was going to be the "long-term price," not merely a price floor.

The market isn't able to drop it under $50 / barrel already, so I don't see what his point is. Much of what Chavez says is either for internal or external consumption but not both, with some unclear aim in mind.
His point is that he gets to count his reserves of tar and asphalt as oil at prices above $50.00/barrel by OPEC rules. This makes his "oil" reserves more than the entire Middle East combined. It also makes Canada an oil super power on paper.

His point is that he gets to count his reserves of tar and asphalt as oil at prices above $50.00/barrel by OPEC rules. This makes his "oil" reserves more than the entire Middle East combined. It also makes Canada an oil super power on paper.
Ah. Well then as I said earlier, he is talking out of his arse. :p

As I recall he said that was going to be the "long-term price," not merely a price floor.
Yes, the point is that OPEC still has an official target price of $35.00/barrel but they have not been able to pump enough to get it that low. If the official target price raises to $50.00/barrel then his asphalt and tar become oil by magic OPEC rules and Chavez becomes an oil super power.

On paper. It could improve Venezuela's credit rating, but it would not change its export earnings.

On paper. It could improve Venezuela's credit rating, but it would not change its export earnings.
Why? All they have to do is get a million people with a million steam powered shovels and they can up their output by a few million barrels a day. :cool:

A result of a combination of horrendous governmental corruption, the fact that tribalism has continued to thrive whilst the nation-state failed to develop and irresponsible development goals are the things that tend to damage Africa the most. I really ought to consider AIDS in on this as well, because a massively infected and sure-to-die work force isn't good for economic growth either.

Possibly as a result of the fact that the nation-states that were created did not respect linguistic and cultural differences? Because the borders drawn up by colonial powers were meant to divide rather than to create unified states?