June 27, 2009Don't Tell Blake Carrington!Colorado ranked worst place for energy industry to do business Surveys and magazine rankings routinely list parts of Colorado as the best places to live. But one survey says for oil and gas companies Colorado is the worst place in the country to do business. Hat-tip: @RockyMtnRight
Posted by John Kranz at 1:21 PM
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But Perry Eidelbus thinks:
Don't you see what a good idea Obama's cap-and-trade is? The One will make Colorado equal with everywhere else...by bringing down everywhere else to Colorado's level. Posted by: Perry Eidelbus at June 27, 2009 2:23 PM
But Boulder Refugee thinks:
On the plus side, the Rockies have won 19 out of their last 22 and are just 7 1/2 games out. Who cares about economics when you have baseball? Posted by: Boulder Refugee at June 29, 2009 10:55 AMJune 26, 2009"Balanced" and "sensible" climate change bill passes HouseThat's the spin thrown on the bill by President Obama yesterday. Surely it was far from either of those qualities at the time, but prior to passage another 300 pages were shoe-horned in ... at 3 am this morning! [What in the hell is the fixation that Washington politicians have with that time of day?] Minority Leader Boehner said the obvious:
Rep. Geoff Davis, a Republican from Kentucky, said the cap-and-trade bill represented the "economic colonization of the heartland" by New York and California. I'd hoped to insert a bulleted list of ways that this bill is a colonoscopy for America but then I realized, Who the hell knows what it does... it jumped from 1200 pages to 1500 overnight! But it's far from law yet. Next stop: the Senate. (Note that as the lions share of H.R. 2454 was written by the environmental lobby this post qualifies for the coveted "dirty hippies" category.) And kudos to JK for naming the 8 RINOs who voted for this treasonous piece of crap. Just four of them switching sides would have spiked it.
Posted by JohnGalt at 7:55 PM
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But AlexC thinks:
That jagoff Kirk wants to run for Obama's former Senate seat. Good luck with that. Posted by: AlexC at June 26, 2009 11:33 PM
But johngalt thinks:
Of the 44 Democrats voting no, one is from Colorado and four are from PA. I'll tell you what - my respect for John Salazar (CO-3) just grew three sizes larger. Posted by: johngalt at June 27, 2009 10:06 AM
But jk thinks:
Well done, Mister Leader! I tend to give up before trying on my representation, but Colorado's two freshman Democrat Senators could well feel a little heat on this issue. To take up an Instapundit riff, having the next Tea Party outside of Senator Udall's or Bennett's office might be a better blow for freedom than a photo-op outside the Capitol. Posted by: jk at June 27, 2009 11:50 AM
But johngalt thinks:
If Mark Udall might face heat on this issue in 2010 he doesn't seem to feel it at the moment. One of the stories I read yesterday said a few senators were working the halls of congress twisting arms for a yes vote. Mark Udall (D-CO) was the one mentioned by name. I'm in for a TEA (Taking Energy Away) party at one of Markey's offices. Instead of pitchforks we'll carry empty gas cans. (Shall we try to organize something for next week?) Posted by: johngalt at June 27, 2009 3:27 PM
But jk thinks:
I'm thinking we'd have better luck with Bennett, but that it would be a good exercise to scare Senator Udall. He is used to catering to CO-2 collectivists and a reminder that Boulder is not the whole state, dude, might be a good lesson. They're pushing on Twitter for GOP defectors (great Twitter tag #capandtr8tors) to change their vote as you suggest with Markey. Is that realistic? I cannot imagine that the same effort would not be better directed at the Senate, but I am open to discussion. Posted by: jk at June 27, 2009 6:29 PM
But HB thinks:
Best quote: “I look forward to spending the next 100 years trying to fix this legislation,” said California Republican Brian Bilbray. Posted by: HB at June 27, 2009 10:15 PMMay 15, 2009For Sale: The Golden StateI really wanted to include a little graphic showing the state of California with a FOR SALE sign planted in it right about at Sacramento. Well, just use your imagination. California's Governor Schwarzenegger has proposed selling a number of state landmarks (state ownership of which is in some doubt) to raise cash and balance the state budget. One-time proceeds are estimated at $1 billion. The budget shortfall is $15.4 billion, just for the next fiscal year. Obviously state officials need more stuff to put in their garage sale. Hmm, I wonder what California has that someone might be willing to pay cash for (other than federal bailout dollars, that is.) Gee, that's a tough one! According to this handy interactive graphic the total government lease royalty revenue that would result from lifting current oil and gas production moratoria is $1695 billion and of that amount, $1386 billion of it comes from the outer continental shelf (Atlantic, Pacific and Gulf regions combined.) A summary report here provides numerous tables showing the breakdown by area but none were clear enough for me to cite specifically. Let it suffice to say the California budget shortfall, at $15.4 billion, is a bit over 1 percent of the possible OCS government windfall. If the Governator would simply work toward responsible development of his state's natural resources he could balance its budget overnight, and for decades to come. As an added bonus, the productive half of America might even throw in legalization of pot!
Posted by JohnGalt at 10:46 AM
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But jk thinks:
I'm just happy the Governator is listening to Reason TV as they point out some of the goodies that are available. Great point on the revenues from energy production. If we could duct tape Senators Boxer and Feinstein in a box* for a couple of days and override the bans, would the Golden State's production be viable at current prices? *ThreeSources does not recommend or condone violent behavior directed at legitimately elected officials. This was merely a dramatic device to suggest possible passage of legislation that the current Senatorial representation of California has long opposed. Posted by: jk at May 15, 2009 11:42 AM
But Keith thinks:
California going bankrupt while refusing to pump all that nice, shiny, revenue-producing oil isn't far removed from half a billion people starving in India while porterhouses and top sirloins on four legs walk around unmolested and uneaten on their city streets. THERE'S a worthy run-on sentence to make a well-deserved point. The picturesque tone of voice is just a fringe benefit. All that being said, I must once again apologize to the whole nation for my state. Let's just face it: we're heap plenty stupid. We gave you Feinstein, Boxer, Schwarzenegger, Waters, and come next Tuesday, we'll see whether we're still stupid. I'm sorry. I'm really, really sorry. Posted by: Keith at May 15, 2009 4:32 PM
But jk thinks:
A feller in the 2nd Congressional Colorado district is not going to cast any stones (not without a permit, Kieth). The Reason video reminded me the hope I had for Ahnold. All humor of the video aside, it underscores just how bankrupt (philosophically) the system is. Watch those union folk -- those teachers "Ain't got none attention of giving nothing up!" Schwarzenegger was a rare chance: he had the star power to get elected as an individualist in a collectivist-leaning state and he had toughness to stand up to the opposition. The California Public Union Sector trained him like a puppy. Is there another one left, Yoda? Posted by: jk at May 15, 2009 5:02 PM
But johngalt thinks:
I see today evidence that the "sell Cahl-ee-fohrn-ya's state landmarks" proposal was little more than a campaign stunt. It was aimed at bolstering support for tomorrow's tax increase ballot measures (which Keith alluded to in his comment.) The half-dozen or so initiatives would raise taxes to collect, as I understand it, an additional $6 billion per year for 3 years from CA taxpayers (read: those "white people" who gathered on Capitol steps nationwide last month). If they fail, as the polls suggest most will, the supposed result will be "deep spending cuts." Good NED, can we get some of those ballot measures in OUR state too?? Posted by: johngalt at May 18, 2009 1:36 PM
But Keith thinks:
johngalt: for more on tomorrow's wacky ballot measures in California, see here: I did an update yesterday pointing my readers back here, and we have a lively conversation going among my readers in which you're always welcome to participate. Heaven knows a good lesson in free-market economics and the proper role of government is sorely needed by Californians, especially our elected overlords... Posted by: Keith at May 18, 2009 1:55 PMMay 13, 2009We'll Pick Winners, We're Just Not Good at It!Scrivener.net has a little fun with the Obama Administrations abandoning funding for Hydrogen cars. He links to a WSJ blog with the sorry scoreboard: “We’re very good at starting programs. We’re not so good at delivering” on the promises made by those programs, Mr.[Robert] Fri said. For example, President Nixon called for a low-emissions car in 1970. Jimmy Carter urged the reinvention of the car in 1977. The Clinton administration started the “Partnership for a New Generation of Vehicles” in 1993. President Bush launched the FreedomCar project in 2003. Meanwhile, General Motors only put Hummer up for sale this summer, when gasoline hit $4 a gallon.
Posted by John Kranz at 5:03 PM
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May 11, 2009Fuel Economy BuffooneryIt was bound to happen: The 2010 Ford Fusion Hybrid - "The most fuel efficient mid-sized sedan in America." EPA rated 41 mpg city/36 mpg highway. You read that right, brother. It is supposedly MORE fuel efficient in town than on the open road. ("Smart" drivers will doubtless pull over and stop every mile or so to improve their highway mileage.)
Posted by JohnGalt at 1:39 PM
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But Keith thinks:
I'm assuming - more efficient in town than on the four-lane because in town, the carbon-based engine shares duty with the electric motor, while freeway speeds on the four-lane require full-time use of the gasoline burner, because battery power can't push you along at a speed needed for freeway driving? Alternative cynical theory: getting out and pushing can be done on city streets only. Posted by: Keith at May 11, 2009 4:36 PM
But johngalt thinks:
Yes, more or less. And the salient point is this: What is the battery's state of charge at the beginning and end of the test? Posted by: johngalt at May 11, 2009 5:17 PMApril 30, 2009Shreveport is ForgivenI got beat up very badly when my band was traveling outside Shreveport, LA. We were, as AlexC would point out, a bunch of dirty hippies, but still I have harbored some less than positive feelings about the place. Now, however, Shreveport may deliver our country from shortages on Natural Gas -- and with any luck obviate some of the nonsensical subsidies for "Green" energy. Those who realize CO2 is not a pollutant must concede natural gas to be one of the cleanest fuel choices. CADDO PARISH, La. -- A massive natural-gas discovery here in northern Louisiana heralds a big shift in the nation's energy landscape. After an era of declining production, the U.S. is now swimming in natural gas. It's a little too far North, but I'll still extend them a heartfelt Lasseiz rouler les bon temps!
Posted by John Kranz at 1:04 PM
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April 28, 2009More bad news for the wind power industryCan the green power bubble really be popping already? From the Guardian UK via American blogger Anthony Watts: 'Britain's Only Wind Turbine Plant to Close' A small excerpt: "The UK has large wind resources and it's a priority for the government but the orders didn't move. That's why we're telling employees that we're not reinvesting there. Those pesky government-induced markets are a real bugger. Be sure to follow the link though and watch the impressive video of a wind turbine exploding. It's not described but appears to me as an overspeed condition. Too windy? Found this while searching for the Governmentium joke. That old blog has been replaced by this new one by Anthony Watts - Watts up with that? Looks like good stuff.
Posted by JohnGalt at 2:47 PM
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April 27, 2009How Much CO2 is REALLY reduced by wind and solar? 30-40% at BESTHere is more evidence for brother Nanobrewer that wind power doesn't work as well as advertised. This time, on environmental and not merely ("merely" - sheesh) economic terms. Co-written by former Secretary of Energy James Schlesinger, under whose leadership the National Renewable Energy Laboratory was established in Golden, CO, this Washington Post article explains that "the sun doesn't always shine and that the wind doesn't always blow." (Stay with me here.) The climate change benefits that accrue from solar and wind power with 100 percent fossil fuel backup are associated with the fossil fuels not used at the standby power plants. Because solar and wind have the capacity to deliver only 30 to 40 percent of their full power ratings in even the best locations, they provide a carbon dioxide reduction of less than 30 to 40 percent, considering the fossil fuels needed for the "spinning reserve." That's far less than the 100 percent that many people believe, and it all comes with a high cost premium. The economic disadvantages are mentioned too, if you care to read the article, but I figured you're already tired of reading about those. NB, I'd be happy to discuss if you care to. Either in the comments, in person or via email.
Posted by JohnGalt at 2:09 PM
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Drill Baby, DrillSo why doesn't 'big oil' diversify and use some of its wealth and expertise to find [fill in your favorite cuddly adjective - clean, renewable, alternative, sustainable, holy] energy technologies to replace their "reprehensible" products? Exxon Mobil CEO Rex Tillerson says it's because if his company were to go into that field then congress would immediately cancel the tax subsidy. Actually what they would do is they would just cancel it for us," he said. He added: “In reality, that is what I fear would happen. So we are not going to go into investments that are dependent on a government providing a tax system to make them viable.” By the way, Exxon said it was increasing its capital budget by 11% and will spend $29 billion next year on finding, drilling and refining fossil fuels and chemicals. So, they’re not planning on going anywhere, anytime soon.
Posted by JohnGalt at 1:48 PM
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April 26, 2009"Dead as hell"That's how wind champion T. Boone Pickens describes the market for wind energy projects in the wake of the mortgage banking crisis. Wind power developers have long relied on complex tax-equity financing to bring most of their projects to market, but that system, once hailed as innovative, has collapsed over the last year, leaving the wind sector flailing for the cash it needs to make generation projects a reality. This ought to give some insight into the economics of "alternative" energy in general and wind power in particular. Nanobrewer recently said he was convinced that wind power "works" economically and I suspect these complex tax-equity financing schemes are the biggest reason for that belief. But nothing about the scheme that made it "work" was the result of a free market. There are myriad ways for the house of cards to crumble. And now, in the wake of AIG and investment banking failures, even last year's most popular wind champion has to admit defeat. So how badly is the sector hurting? Oil tycoon turned wind speculator T. Boone Pickens recently described the wind market as "dead as hell" to the Wall Street Journal. Richard Saunders, director of project development at GreenHunter Renewable Power, said Pickens was not far off. If wind power "worked" economically then none of this would be happening. Consumer demand for the stuff would bring investment capital in torrents. I also enjoyed the following point-counterpoint between wind industry analyst Tyler Tringas and ARI's Yaron Brook: "He [Tringas] added that he does not believe in government meddling, but he does think lawmakers need to account somehow for the cost of carbon." Brook's reply - "I don't believe there's an externality cost to CO2," he told Tringas. UPDATE: This may (or may not) be the WSJ piece where Pickens first made the "dead as hell" assessment. I can't tell since it's subscription only and I only get the preview. Nonetheless, it bears mention for this: Hit hard by the recession, the clean-energy industry is on the ropes. Governments are injecting stimulus money in hopes of keeping it alive, but what the industry ultimately needs is a far bigger dose of private investment. Umm, wasn't government "investment" supposed to create millions of "new energy jobs" that would pull America out of recession? If the recession itself has "slammed the brakes" then how can ANY amount of government "stimulus" make any difference?
Posted by JohnGalt at 3:20 PM
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But Perry Eidelbus thinks:
"If wind power "worked" economically then none of this would be happening. Consumer demand for the stuff would bring investment capital in torrents." Exactamundo. I've meant to blog about this for a long time, ever since T. Boone started his hogwash. He's looking at wind power because he sees a profit opportunity. If that were the end of it, I'd say "Power to him" and not blink an eye. However, he's seeking profit via government coercion: he's lobbying hard so government will skew markets in his favor, whether it's forcing energy producers to use more windmills or giving tax breaks to Pickens because he built more windmills early on. He can go ____ himself up the tailpipe with one of those large windmills, and then go to hell. Posted by: Perry Eidelbus at April 27, 2009 2:20 PMApril 21, 2009Truth to PowerThat whooshing sound you hear is the whole Upper West Side gasping for breath. Science Editor John Tierney tells it like it is in the New York Times in Use Energy, Get Rich, and Save the Planet. 1. There will be no green revolution in energy or anything else. No leader or law or treaty will radically change the energy sources for people and industries in the United States or other countries. No recession or depression will make a lasting change in consumers’ passions to use energy, make money and buy new technology — and that, believe it or not, is good news, because... A little choir preaching -- but ThreeSourcers should cherish every word, and then store the link to rebut their acquaintances.
Posted by John Kranz at 5:39 PM
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But T. Greer thinks:
I have always liked Tierny. He is a pragmatist first and foremost, and has never been afraid to tell environmental activist crowd when they are scare mongering. In addition, he has always been fair to the adaptation advocates, whom I count myself among. *sigh* I wish more science editors had his backbone.
But jk thinks:
Amen to both. Tierney is great. Posted by: jk at April 21, 2009 7:42 PM
But Perry Eidelbus thinks:
I just noticed. That's, uh, Upper West Side. :) And if it's the NY Times building, that's still midtown. Posted by: Perry Eidelbus at April 23, 2009 1:49 PM
But jk thinks:
Thanks to our NYC editor for keeping me honest. I have since corrected West Upper Side to Upper West Side (dang it, even I know that). And I was looking more for the true believing subscribers than the publisher. Posted by: jk at April 23, 2009 2:03 PMApril 13, 2009We Should All GoAt the Boulder Theatre, tomorrow night: Boulder Weekly Films & Center for ReSource Conservation: They forgot to say "No Moonbats Allowed!"
Posted by John Kranz at 6:36 PM
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April 7, 2009Quote of the Day IIIWhat kind of lazy-ass blogger posts three "QOTDs???" Well, what could one possibly add to this? No one at GM ever said that the first-gen Volts would make money, but Troy Clarke, president of GM's North American operations, recently told Automotive News that the second-generation vehicles might also be a red entry on the books. Of course, "as we get a chance to change the generations of technology, we'll lose less and less," he said, adding that, "It's not our intention to lose money forever." Well, that's something. -- autobloggreen.com
Posted by John Kranz at 1:50 PM
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But Keith thinks:
Crikey! It's like they brought Madman Muntz back from the dead to run GM. The Muntz Jet may actually resume production at last - complete with an in-dash four-track tape deck, for your listening pleasure... Posted by: Keith at April 7, 2009 3:25 PM
But Boulder Refugee thinks:
What'm I gonna do with all my old 8-tracks? Granted, the "Jesus Christ Superstar" tape is broken, but I've still got "Tommy"... Posted by: Boulder Refugee at April 8, 2009 11:24 AM
But johngalt thinks:
I haven't heard this discussed anywhere yet but this seems like a good time and place: After Obama Motors cancels the "gas guzzling" but profitable SUV car models I'd like to see some enterprising billionaire spin them off into a new auto company - he could call it "Specific Motors" - and put the profitable models back into production. It would be interesting to see if consumer demand could defeat layer upon layer of government coercion as Obama Motors uses its power of force to "compete" with the desirable cars. Posted by: johngalt at April 8, 2009 11:28 AM
But Keith thinks:
jg: I like your idea, but it won't happen. Were GM/Obama Motors to do away with the popular models you describe, it would be done in the the name of the environment and in the name of fuel consumption. Being at the behest of government policy, your spin-off company won't be ALLOWED to manufacture the now-contraband autos, and if necessary, legislation will be enacted forbidding the popular gas-guzzlers. It will probably be an amendment to Directive 10-289. That being said, the gubmint can have my gas-guzzling V-8 Mustang GT when they pry the five-speed shifter out of my cold, dead right hand - if they can catch me first. Second, "Specific Motors" is a name that needs improvement. It needs to be named after the founder, like "Taggart Transcontinental," "d'Anconia Copper," or "Wyatt Oil." A generic, faceless name like "Amalgamated Switch and Signal" or "Associated Steel" just won't do. Wouldn't it just be sweetly ironic to see this happen under the banner of "Galt Motor Works"? Posted by: Keith at April 8, 2009 1:39 PM
But jk thinks:
Lunching with ThreeSources friend Silence Dogood, I just suggested that the government could "fix" Chrysler and GM by saying the CAFE standards are forgotten, have a nice day. A little simplistic, but I'd love to see it tried. Okay, Keith we need more data -- what year is the horse? Posted by: jk at April 8, 2009 8:06 PM
But Keith thinks:
jk: 2004 (Fortieth Anniversary), dark gray - so I have no fear on highways where you see the sign "Patrolled By Aircraft." I'm the same color as the pavement. Low-tech stealth, and producing a CAFE-curdling 17-18 MPG - just a hair greener than the mileage I used to get on my 1986 Jeep CJ-7. I like your idea of deep-sixing CAFE. I'll add one to counterbalance it, since we're also going to have to do something, throw a bone to the global warming crowd. I once proposed that here in California, they print the IQ of every licensed driver on their license, and allow them to drive at speeds up to their IQ rating. Here in California, that would keep the average down to Jimmeh Carter's gas-saving 55... Posted by: Keith at April 8, 2009 9:20 PMMarch 9, 2009Why politicized economic development is dangerousI recently wrote on the danger of politics driving scientific research. The obvious case of this now is all of the government "investments" being proposed in the name of "saving the planet from irreversible damage due to climate change." But even if man-made climate change was real (sorry tg, is real) and even if "renewable" energy sources were beneficial to counter it, the least effective entity to make them a reality is - wait for it - government. Consider the following essay on "One Reason Governments Spend So Much" from the 'Uncle Eric' book: Whatever Happened to Penny Candy? Industries generally develop in three stages. First is scientific feasibility, second is engineering feasibility, and third is economic feasibility. This economic development of the economically unfeasible is precisely the modern story of: Wind power
Posted by JohnGalt at 2:38 PM
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But Keith thinks:
Just to add to the entertainment value: "But even if man-made climate change were real..." is the grammatically accurate construction. Heh. JohnGalt: great post, and the model of three-stage development makes plain, even to a poor, dumb country boy like me, why government-run economic development doesn't work. And to boot, it's much more elegant than me just saying "a government that can't even balance its own checkbook has no business fiddling with the economy." I'd only propose one small change to the quote rfrom the essay. Where the author wrote "Once science and engineering prove something can be done, those who comprise the government will do it - even if the costs are greater than the benefits" in the last paragraph, it seems to me that the last phrase should omit the word "even" and the hyphen, thusly: "... those who comprise the government will do it if the costs are greater than the benefits." If the benefits are greater than the costs, entrepreneurs and private industry will do it, without the necessity of government meddling. Profit motive being what it is, and all that. Ergo, government will ONLY do it if its benefits do not justify its costs, and that applies to every item in your list. QED, yes? Posted by: Keith at March 9, 2009 3:18 PM
But jk thinks:
Ahh, the punchline from a great old gag can be trotted out: I congratulate Keith on his use of the subjunctive.Posted by: jk at March 9, 2009 4:32 PM
But Keith thinks:
Thanks, jk... Say, on the subject of government and the economy, I've been reading in the news today that Warren Buffett has been quoted as saying the U.S. economy "fell off a cliff." I've read that three times today, and every time, all that comes to mind is... "It was pushed." Posted by: Keith at March 9, 2009 5:11 PM
But johngalt thinks:
Wellll, I was trying to have some fun with TG, saying "was" as in "past tense" ... before it was largely discredited, then replacing it with "is" as a sop to him since he's not yet comfortable with the "denier" badge of courage. I admit - sometimes my jokes trip over their shoelaces. Oh, and yes, I do fully agree with your improvement of the closing paragraph. Well done! Posted by: johngalt at March 10, 2009 12:25 AM
But jk thinks:
Tough room, jg, you know that as well as anyone. Posted by: jk at March 10, 2009 1:34 PM
But T. Greer thinks:
Eh, I though the post was funny. I also think you have highlighted one of the biggest problems with the Eco-stimulus crowd. What they call progress is in actuality a retardation (word?) of Western civilization. Posted by: T. Greer at March 11, 2009 12:19 PMMarch 6, 2009Why Politicized Science is DangerousYesterday I commented that there's "another important dragon to be slain before" the next elections for congress and for president. That dragon is the myth of man-made global warming caused by our use of economical, safe and abundant energy sources. Many of us have long contended that the idea is founded upon pseudo-science. The late Michael Crighton agreed and in an appendix to his wonderfully entertaining and thought provoking novel 'State of Fear' he wrote "Why politicized science is dangerous." Imagine that there is a new scientific theory that warns of an impending crisis, and points to a way out. Read on below-
Posted by JohnGalt at 12:10 PM
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But jk thinks:
Careful, jg, TR has some strong followers around here. Sure he wanted to control capitalism from Washington, lock up his enemies and kill the enfeebled, but he displayed prodigious intellectual powers, looked good in casual clothes, and said "bully!" a lot. Posted by: jk at March 6, 2009 2:36 PM
But johngalt thinks:
One of Crighton's points is how, after the horrors perpetrated in the name of the theory became widely known, "nobody was a eugenicist and nobody had ever been a eugenicist." You'll recall I suggested not long ago that we start a permanent record of Global Warmists today, for the historical record. My favorite thing about TR was "speak softly, and carry a big stick." Posted by: johngalt at March 6, 2009 3:47 PM
But T. Greer thinks:
@Jg: I read that book and thought it sucked. (Tidal waves=result of climate change?) On the other hand, I thought the appendix you link to was quite insightful. It is rather sad to me that one's views on AGW are determined by your political affiliation. These days it seems that if you believe in "protecting the environment" then AGW is a self-evident fact not worth examining, while if you are of the free-market crowd, there is no way the climate could ever be linked to man's activities on the Earth. This is a false dichotomy. It is perfectly acceptable to hold that warming may be influenced bu man and that free markets should not be interfered with for the environment's sake. Indeed, this is the exact position I hold.
But T. Greer thinks:
@Jk: Hahahha. Enough already! I think we have covered this before- Roosevelt's views on eugenics never led to anything more than a desire to make immigration laws stricter. Vilifying him for politicizing science makes no sense. Everything else you have listed is irrelevant to the subject of this post and has been discussed already. Posted by: T. Greer at March 6, 2009 5:32 PM
But jk thinks:
Okay, I'll leave TR alone. I enjoyed the Lomborg clip. He inspired the D in DAWG and I think his position is reasonable and defensible. I hold that the debate was politicized by the left: those who Popper said would have us go back to the caves. Suddenly, the inefficacy of their ideas was meaningless: we had to take on the whole Nader-Kucinich platform or all of our children will die! The DAWG advocates then claimed that "the science was settled" because a poll was taken. Popper, again, pointed out that science is not really done that way. Yes, it is too bad that something important has devolved into childish bickering -- but, Mommy, they started it!! Posted by: jk at March 6, 2009 7:04 PM
But johngalt thinks:
But it isn't called global warming anymore tg, it's "climate change." That way the charade can be continued whether the trend is warmer or cooler. Which is fortunate for them since now, it's cooling. The market interference you allude to is the setting of arbitrary limits on emission of mammal breath. "First they came for the dioxins, then the beneficial pesticides, then the fluorocarbons, oxides of nitrogen and sulfur compounds, and when they came for carbon dioxide there were no pollutants left to say - you can't regulate non-pollutants!" Posted by: johngalt at March 7, 2009 8:11 PMDecember 19, 2008Millions of Green Collar Jobs!Candidate Obama promised his administration would create millions of "green collar jobs," and to most it was a successful platform. Myself, I heard "Wasted $Billions and stifled innovation from government intrusion" but I am a partisan hack. I'd bore whoever would listen with "when the government picks winners in the energy sector we get Synfuels and Ethanol." Let the Senators decide what projects get funded and don't be surprised if we're all driving our cars on Iowa's major export. Had Senator Craig had not been busted, I suppose we'd be developing a potato-fuel infrastructure. In addition to creating more greenhouse gases, costing more, and adding to volatility in world food markets -- how's that Ethanol decision panning out? Instapundit links to this story about the collapse of North Dakota's ethanol industry and the evaporation of subsidies promised to keep the economically unviable industry afloat: North Dakota has an annual capacity of 333 million gallons of ethanol. Due to this year’s excessive commodity fluctuations, VeraSun, the state’s largest producer (which recently filed for bankruptcy), is itself eligible to claim a full $1.6 million from just one quarter’s worth of production. Over the past two months the price of corn has dropped sharply, leaving producers with very expensive inventories.
Posted by John Kranz at 1:42 PM
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But Keith thinks:
Denier? Pshaw. Think of him as that kid with enough nerve to point out that the emperor was out parading in the buff. Being the only person in the house to see the truth and act on it does not make one wrong. Posted by: Keith at December 19, 2008 6:59 PMDecember 1, 2008Never Saying You're Sorry...I don't have to remind ThreeSourcers of my high esteem for Instapundit. Professor Reynolds gets the lion's share of my hat-tips and I find it hard to imagine his equal in effectively voicing a pragmatic, little-l libertarian philosophy. We differ on immigration, but I accept that. I differ with many I respect on that topic. But I remain muchly vexed with Reynolds's unequivocal support for flex-fuel mandates, specifically the Zubrin Plan. I join him in looking forward to powering our cars and trucks on kudzu. But I wholly reject the idea of government mandates in the name of "energy independence." To his credit, he offers the flip side today, if without mea culpas: For the 2008-2009 period, fully 61% of vehicles had exemptions to run on gasoline. The mandate resulted in flex-fuel vehicles purchased for Puerto Rico and Hawaii, where E85 pumps don’t exist as it’s quite expensive to ship large quantities of ethanol. In some locations, said pumps are nearby but don’t accept government credit cards. So, despite all good intentions, the result is an increase in government gasoline consumption. Not mentioned in the article was that the billions of dollars in purchases went almost, if not wholly to the Detroit 2.8, as import manufacturers (still) don’t offer many flex-fuel cars or trucks. Perhaps we could recoup the energy of Hayek spinning in his grave. Government does not have the information to dictate automotive design, nor would I trust them to make the right decision if they did. When those 0.99/gallon KudzuCo stations start opening up, consumers will demand flex-fuel vehicles where they are appropriate.
Posted by John Kranz at 11:51 AM
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But Perry Eidelbus thinks:
"a pragmatic, little-l libertarian philosophy." If Reynolds were a real libertarian (capital L or not), then he wouldn't be supporting government mandates of any kind. Where is the liberty in forcing fuel standards on me or anyone else? With that post today, he can't even admit the failure of his "pragmatism," can he? He can call himself a libertarian until the day he dies, but he's just another pseudo-libertarian who wants the government to regulate certain markets he thinks are failing/can fail. Real libertarians know that free markets work and can fix themselves better than any government bureaucrat can (Hayek, knowledge problem, Q.E.D.). Real libertarians don't want the government intervening, not just in things I like that don't harm others, but *especially* in things others do that I personally dislike but do no harm to others. Posted by: Perry Eidelbus at December 1, 2008 4:04 PM
But jk thinks:
I wondered if he would relate that post of his to his ongoing support for the Zubrin Plan. I even sent him an email (there go my chances for a link in 2009, eh?) To be fair, Perry, I think he would be the last one to stake a claim to being a "real" L|libertarian. And I think he does a great job advancing little-l philosophy. The race for the purest Libertarian fills the most comical pages of Brian Dougherty's Radicals for Capitalism: only the purest is allowed to stay in the room. I still support the Iraq War -- excuse me, I mean "The Debacle in Iraq" -- so it's pretty clear from reading Gene Healy and David Boaz last week that I'm not invited to the party. I still believe in the importance of Deepak Lal's Liberal International Economic Order and will support blood and treasure to preserve it. I do think the most trenchant description of libertarianism ever occurred on Instapundit when a reader said "I dream of an America where millions of happily married gay couples have closets full of assault weapons." That remains a good, quick definition for me.
But Perry Eidelbus thinks:
And I think he does a great job advancing little-l philosophy. The race for the purest Libertarian fills the most comical pages of Brian Dougherty's Radicals for Capitalism: only the purest is allowed to stay in the room. You don't have to be "pure," just not so diluted. Reynolds is to real libertarians what a light beer is to San Miguel. There are superficial similarities until you realize the difference in depth and complexity. Sean Hannity has claimed "We're pretty libertarian on this show," and witness the emergence of "libertarian Democrats." It only goes to show the term is losing all meaning. It has to have clear definitions. It has to mean something. I still support the Iraq War -- excuse me, I mean "The Debacle in Iraq" -- so it's pretty clear from reading Gene Healy and David Boaz last week that I'm not invited to the party. It's a matter of why you supported the Iraq War. Do you believe in pre-emptive wars and nation-building? I felt Saddam was still a threat to the U.S. and have mixed feelings only because of how we handled the aftermath. By and large, we *were* welcomed as liberators. We just didn't know what to do once we toppled his government. A libertarian can justify the action because Saddam had previously kidnapped Americans and was continually violating the cease-fire. If Saddam had not done those, then I couldn't have justified toppling him. But Ron Paul was right: we should have dropped all the political pretenses and had Congress formally declare war. If anything, it would have prevented the Kerryism of "I voted as a last resort, I didn't think we'd actually do it!" Of course, all this would be irrelevant if Bush Sr. hadn't been a UN-heeding pansy, and Bubba was worse. There's nothing in libertarianism that says you can't retaliate in full force when your citizens are kidnapped, e.g. Jefferson's response to the Barbary pirates. I still believe in the importance of Deepak Lal's Liberal International Economic Order and will support blood and treasure to preserve it. Which isn't quite what Lal is talking about. The state can protect people, but the extent of what you're talking about is giving far too much credit to the state for protecting people. The danger is that people start relying on military protection of land and sea trade routes, much like Americans rely on police instead of themselves. "I dream of an America where millions of happily married gay couples have closets full of assault weapons." That's his own individual opinion, you see. The real libertarian way puts it more generally. I forget how Jefferson put it so wonderfully succinctly, but this is an expanded version: "I dream of an America where people have their unalienable rights to life, liberty and property: essentially, the freedom to do what they want -- including but not limited to forming legally enforceable contracts with homosexual partners, or owning whatever weapons they so desire -- so long as they do not infringe on the unalienable rights of others." Posted by: Perry Eidelbus at December 2, 2008 10:25 PMNovember 25, 2008Tightly Controlled Oil Supply Slips Into SurplusIn June I posted a Cato Institute article "Get Ready for the Oil Price Drop." At the time I read (but never linked) a separate article on American.com that showed the careful balance between world supply and demand for oil that allows relatively small inventory changes to effect relatively large price changes. The data available at the time was only through the end of 2007 and was still showing a supply deficit. The latest data, updated earlier this month, shows the first surplus since 2005 occurred in the second quarter of this year. It's not difficult to understand, then, how the predicted oil price drop materialized in the form of $1.70 gas replacing the $4 variety.
The graph above is my own, created from EIA's Excel data, to which I've added the "Total World Supply Balance" data line comprising supply minus demand. Note that I had to multiply the resulting data by 10 in order to see plus or minus movement on the same scale as the overall supply and demand. The take away from this should be that adding as little as 1.9 million barrels per day (2.3%) to the world oil market at any time in the last 2.5 years would have put the market in surplus at the time. Remember that the next time someone says, "The small amount of oil we could produce domestically would not lower prices for 10 to 15 years."
Posted by JohnGalt at 3:13 PM
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October 14, 2008Cheap GasI'm tired of hearing this, and I've only heard it twice. Here's GM doyen Bob Lutz: "We may hate high fuel prices, but they've been driving us in the right direction when it comes to fuel economy. If we suddenly went to $1 or $1.50 a gallon, that would be really bad." Rilly, rilly bad as Thomas Pynchon might say (Vineland -- five stars!) but I digress. Larry Kudlow had a guest last night (not listed on the blog, sorry), an ostensibly conservative money manager, who was peddling this line. He wants $140 oil because he does not want to lose momentum in alternative energy. Kudlow suggested that it would have to drop to $50 or below to threaten that, but Mister Guest thought that the psychological value of oil had a huge influence. 'Scuse me fellas, but is anybody paying attention to what is happening? Three dollar gas will be a huge break for small business and the American consumer. It's one a few things that überoptimist Kudlow can seize onto. I know Lutz has put all his chips on an electric car that will lose money at three times the price of a comparable combustion vehicle. I'm a Friedmanite and will support his defense of what's left of his shareholders' value. But for any responsible economist to root for more "back to the caves" (That would be Karl Popper, also five stars, but good luck finding it!) to prevent us from global warming has perhaps not noticed the correlation of per capita income and environmental concerns. Bring back dollar gas, I'm in.
Posted by John Kranz at 1:56 PM
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But Boulder Refugee thinks:
The screed highlighted by tg is not news to The Refugee, either. However, it is usually followed by the line, "...and that's why we need higher gas taxes." The Refugee has no quarrel with the market driving up the price of gas and making alternative fuels economical. His problem is with governments stiffling production (supply) and increasing taxes to dampen demand. Back to the original point, however: Lutz says,"We may hate high fuel prices, but they've been driving us in the right direction when it comes to fuel economy," as though he is powerless to make design decisions. If he wants to design a bunch of rubberband driven cars he can do it. The Refugee bridles at his attempt to used gas prices as an excuse for inaccurate market forecasting (to wit, Toyota got it right) and poor product design decisions. Those decisions were driven more by a union-based cost structure than "what Americans want." He was lucky it lasted as long as it did. Posted by: Boulder Refugee at October 14, 2008 10:13 PM
But Boulder Refugee thinks:
And another thing: The Refugee is willing to bet that Kudlow's money manager has a lot of money riding on alternative fuel investments that would be jeopardized by lower gas prices. Posted by: Boulder Refugee at October 14, 2008 10:16 PM
But johngalt thinks:
br (refreshingly) writes, "The Refugee has no quarrel with the market driving up the price of gas and making alternative fuels economical." tr (curiously) writes, "T. Greer, confident in the future of democracy." But what br's quote describes is democracy in action in the marketplace, while tg brings us the voices of America's enlightened youth claiming that high gas prices are "the solution." As br and I have both asserted, high gas prices are an artificial result of authoritarian regulations and market interference on the part of government. (That the government was purportedly seated through democratic means does not innoculate it from the charge of authoritarianism.) So what tg means is that he is, "confident in the future of democracy to force "the solution" upon ignorant rednecks who don't understand the urgency of wiping out the worlds most economical fuel source." Democracy uber alles, except in the case of free markets. (Or any other instances when the majority wants the "wrong" thing.) And while there's been nothing but the sound of crickets chirping on dagny's open letter to Obama supporters the ideas espoused in these comments from tg explain as well as I've seen how anyone could support Obama: For all their self-espoused enlightenment, Obama-tons just can't see how their beliefs are manipulated by the flowery rhetoric of statism. Posted by: johngalt at October 15, 2008 3:27 PM
But T. Greer thinks:
@Jg: Almost correct. You forgot the phrase that ends the sentence: I am confident in the future of democracy to force "the solution" upon ignorant rednecks who don't understand the urgency of wiping out the world’s most economical fuel source for that we may save humankind and Planet Earth. The most curious thing about this is that many of the members of these high-gas-groups are Republicans. Furthermore, it has been my experience that most young Republicans use similar rhetoric and reasoning to defend current Republican planks. ~T. Greer, not quite sure that it is wise (or possible) to use statist means to accomplish libertarian goals.
But johngalt thinks:
No, I didn't forget the phrase "so that we may save humankind and planet Earth." (I did forget the apostrophe in "world's" however.) No, the phrase at issue is implicit in the title "ignorant rednecks" along with many other phrases like, "spreading the wealth around is good for everybody" and "the cause of radical Islamic terror is American exceptionalism." You see, we ignorant rednecks don't "know" that continued use of gasoline will wipe out the planet and all of humanity along with it. We still adhere to quaint notions such as proof, evidence, causality, logic, reason. We don't turn into drooling zombies at every mention of the latest crackpot hypothesis out of post-modern ivory towers merely because someone, somewhere, has the temerity to call it "science." In order to "know" that gasoline is the harbinger of the end-of-days one must have "faith" in the preachings of his particular clergy who bring this important message from his particular deity. As for this "ignorant redneck" ... I'm not a theist, therefore I don't "know" how evil gasoline is. --- I do agree with you that it is impossible to use statist means to accomplish libertarian goals. So what sort of goals do you suppose statists really have? Posted by: johngalt at October 16, 2008 3:16 PM
But T. Greer thinks:
Aye, point taken. Although I would note that things like "We need to stop giving those oil barons money they don't deserve" is often just as much a reason cited as any environmental concern there may be with the practice of consuming gasoline. Before I answer your question, I think a distinction must be made. There are statists who wish we would use statist methods to reach statist goals. Then there are the folks who would balk at being called a statist, but who have been trained to think that the government can solve all of our problems, and as such, can't help but support statist methods to reach statist goals. One who thinks that America should nationalize various industries so that the government can wield greater influence, provide greater security, or obtain a bigger budget is of the first sort. One who thinks that it would be a good idea for the government to send a $200,000 check to every American family (see here: http://www.congress.org/congressorg/issues/alert/?alertid=11976981&content_dir=ua_congressorg) in order to ease America's financial woes is of the second sort. The goal of the second person is to strengthen America's economy. This is not a goal exclusive to statists. Yet the means of accomplishing the goal -redistributing income- are undeniably statist. I find the second man much more frightening than the first. It is easy to rob a statist of his masks. It is quite a bit harder to break that Faustian bond of big government and great expectations. ~T. Greer October 7, 2008Flex FuelProfessor Mankiw has his damned (pronounce two syllables) Pigou Club and Professor Reynolds has his Zubrin plan. I should let it rest, but every time they push it I wonder how those two can be so off. Dr. Zubrin massacres the Obama Energy proposal today. It lacks any mercy at all and should be read in full, several times a day. The lone happy note at the very end of the piece is that -- like Zubrin -- the Obama plan calls for mandates to force automakers to produce "flex fuel" vehicles. The best part of Obama’s plan is his strong support of biofuels. In contrast to John McCain, Obama favors both the renewable fuel standard and ethanol production subsidies. These subsidies cost taxpayers $0.45 per gallon of ethanol produced but save the nation $3 in foreign oil purchases at the same time. Why John McCain prefers to send $3 to Saudi Arabia instead of $0.45 to Iowa is difficult to understand, especially given the strategic nature of the commodity in question, and the fact that the foreign oil money helps to finance acts of war and terror against the United States. Yet he does. So on this question Obama has it right and McCain has it badly wrong. Now, I think biomass methanol and cellulosic ethanol are exciting technologies. I also like puppies and would like to see kids drinking clean water. But Zubrin wants to pick the winner today. Screw the market, we'll mandate $130.00 extra cost to new American cars. T. Boone wants CNG cars. I am leery of some of his plans but CNG cars seem to make sense just on their own. I propose that if you make $2 gallon Kudzu-ethanol, you will have a lot of Americans demanding flex fuel vehicles or upgrading their own. The $2.40 CNG on the Pickens Plan Commercial could do the same. We might also find algae output that could go straight in a diesel engine or landfill waste or a rapid adoption of plug-in hybrids. Let's not have the gub'mint pick a winner first. And. Dr. Z, don't be shocked that Senator McCain would rather willingly send money to Saudi Arabia than be forced to send subsidies to Iowa. The difference is coercion, not geography. Hat-tip: Instapundit, of course, who links favorably
Posted by John Kranz at 4:50 PM
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But Boulder Refugee thinks:
If we'd drop the tariffs on foreign ethanol, Brazil may well supply all we need. Then, we might not need to send $.45 a gallon to Iowa and Nebraska. Unfortunately, Grassley and Hagel have something say about it. Posted by: Boulder Refugee at October 7, 2008 6:24 PMSeptember 15, 2008Democrats on EnergyMy illustrious Senator, Ken Salazar, was picked to provide the Democratic response to the President's radio address. I'm sure nobody missed hearing that, but let's go over some of our favorite parts, as the Senator sent me a copy: Democrats are working for change, and it starts with being honest about our energy future. There's more but you get the drift. Here's the audio if you want to relive the excitement! This strikes me as one of the most amazing misrepresentations I have heard since "I did not have sex with that woman." Drilling was the only idea at the RNC? GOP legislators have been pretty clear about an "all-of-the-above" strategy with all of Senator Salazar's kumbaya fuels plus nuclear plus expanded offshore drilling. Salazar downplays the environmentalism that he knows won't sell too well with his rural constituents, completely ignores nuclear, and misrepresents the rest. I'm a big boy. I can handle and dig a little spin, a little shading, and a little aggressive positioning. But this is an outright lie. And it was heard by at least ten or twenty people!
Posted by John Kranz at 5:13 PM
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September 12, 2008Millions of Green Collar Jobs!It's -- like -- Senator Obama is already President! Thin Film Solar Companies Raise Hundreds of Millions in Funding This could reduce our dependency on foreign oil, cut greenhouse gas emissions, and provide jobs in the clean energy sector! This is awesome stuff! I read the post twice, however, and could not figure out which government office or division was making this happen.
Posted by John Kranz at 11:49 AM
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August 21, 2008Thank You Mister Stossel!I wince at quite a few things that Democrats say. But a bipartisan wince-inducer is the call for "energy independence." John Stossel points out "how ideas with no merit become popular merely because they sound good." To be for "energy independence" is to be against trade. But trade makes us as safe. Crop destruction from this summer's floods in the Midwest should remind us of the folly of depending only on ourselves. Achieving "energy independence" would expose us to unnecessary risks -- such as storms that knock out oil refineries or droughts that create corn -- and ethanol -- shortages. I ask people who champion this whether they are "food independent." "What if King Soopers decides to stop selling you food tomorrow? Your family will starve!!!" (I don't seem to get invited to as many parties as I used to...) Stossel rips this one out of the park Don't Obama and Pickens realize that we get something useful for that money? It's not a "transfer"; it's a win-win transaction, like all voluntary trade. Who cares if the sellers live in a foreign country? When two parties trade, each is better off -- or the exchange would never have been made. We want the oil more than the money. They want the money more than the oil. They need us as much as we need them. Whole. Read, Thing. The. Hat-tip: Instapundit
Posted by John Kranz at 3:00 PM
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August 18, 2008Your New Friends, Governor.We need to switch to renewable energy, but we can't build anything. Environmentalists don't want to build the transmission lines to connect T. Boone Pickens's wind farms with consumers. Even smaller scale projects are getting axed. WSJ Ed Page: Go ahead, say "It's kind of schizophrenic behavior" in your best Arnold Schwarzenegger voice -- I'll wait. My buddies on the Ed Page have discovered the real agenda: In other words, the liberal push for alternatives has the look of a huge bait-and-switch. Washington responds to the climate change panic with multibillion-dollar taxpayer subsidies for supposedly clean tech. But then when those incentives start to have an effect in the real world, the same greens who favor the subsidies say build the turbines or towers somewhere else. The only energy sources they seem to like are the ones we don't have. Let the bastards freeze in the dark!
Posted by John Kranz at 2:12 PM
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But johngalt thinks:
Exactly right. They don't want "alternative energy sources;" they want "alternatives to energy sources." The only energy they'll endorse is naturally harvested sunlight and the only commercial product they won't oppose is hemp. Unlike Charlie Brown, Americans will eventually recognize that the greens keep pulling the football away. I'm seriously hoping that a majority do so before November 4th. Posted by: johngalt at August 19, 2008 3:06 PMAugust 15, 2008Roan BlownThe oil and gas lease auction for Colorado's gas-rich Roan Plateau was held yesterday and generated $114 million, just 1/20th of what some had predicted. Those who have followed the Roan process and debate know that Gov. Ritter and the Democrat legislature have been working diligently to raise taxes on energy producers, including proposed referendums and radio ads demagoging these producers. Senator Salazar has been working in Congress to increase the already-byzantine permitting process to make it simply not worth the effort. The significantly lower lease bids demonstrates that producers factored higher taxes, increased administrative costs and greater uncertainty and thus discounted their bids accordingly. Perfectly rational. Do you suppose that Ritter, Salazar (the senator who would said he would not support expanded domestic drilling at $10 a gallon) and the Dems learned a lesson in basic economics? Do you further suppose that they now understand that companies are tax collectors, not tax payers? Maybe they concluded that raising taxes leads to lower revenue? Of course not. Who did they blame? President Bush, of course. The Refugee hopes that Ritter is merely playing politics not just plain stupid. The Refugee, a dyed-in-the-wool Republican, has been pleasantly surprised by previous Democratic governors (ie., Dick Lamm and to a lesser extent Roy Romer.) However, The Refugee had low expectations of Ritter, expectations that Ritter continues to fail to achieve. This guy is terrible, and Colorado's tax coffers are suffering as a result.
Posted by Boulder Refugee at 12:01 PM
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But jk thinks:
Great post; I had missed that entirely. All these same Democrats will prohibit companies from exploring and drilling -- and will then ask "why companies are not using the leases they have now?" Our state is lost, and I see little hope in the Colorado GOP or new voters' having the capacity or wisdom to resist it. I'm usually pretty upbeat. But I think brother jg is right: the state coffers are a golden goose to be fleeced by those who oppose the policies that created the gold. August 13, 2008Energy Freedom DaySign the petition created by Senator Jim DeMint (R-SC) and Rep. Jeb Hensarling (R-TX) calling on Congress to let the drilling bans expire on October 1, 2008. The related blog page can be accessed here. Hat Tip: Human Events via Wayne at jeremiahfilms.com
Posted by JohnGalt at 3:14 PM
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August 12, 2008Pelosi blinkingA week or so after telling democrats in competitive races it's OK to blame her for congress' inaction on energy legislation she now tells Larry King she's willing to allow a vote. Pelosi, speaking Monday on CNN's "Larry King Live," said "We can do that. We can have a vote on (oil drilling)." Why the sudden change of heart? Republicans are threatening to shut down the government. In a letter from DeMint to Reid, DeMint indicates the GOP has the votes to sustain any veto of a continuing resolution that might get 60 votes. What do you call it when Republicans force a vote on lifting the drilling ban AND shut down the government in the process? I call it eating one's cake and having it too - killing two birds with one stone - bre'r rabbit getting thrown into that thar briar patch. Let's do it! Unfortunately, Pelosi wants her precious government purse badly enough that she'll cave on the energy vote. She certainly also has known for some time what is now being reported: That the offshore and shale oil drilling bans will automatically expire on October 1 unless renewed by an affirmative act of congress. Sounds to me like a vote might be required in there somewhere.
I report - you decide - The fifth paragraph of the Fox News article I cited reads as follows: This is setting the stage for a showdown in September with Senate Majority Leader Harry Reid, D-Nev., and most other Demorats who oppose this drilling. I'm not making this up - that's how they spelled Democrats. Is it in their spell check dictionary that way or did they just click "ignore?" Either way, I smell a rat! :)
Posted by JohnGalt at 3:02 PM
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But Wayne thinks:
Great news ... updated Jeremiah Films' House Recess Really? post and added link to your post Posted by: Wayne at August 13, 2008 2:51 PM
But johngalt thinks:
Thanks Wayne! I particularly enjoyed this Human Events article also linked from your site. Posted by: johngalt at August 13, 2008 3:14 PMAugust 7, 2008Drill, Drill, Drill and King DollarI guess it is safe to say, sadly, that I am more like Larry Kudlow than Paris Hilton after all. My comment on the Everyday Economist referenced in my Paris Hilton post engendered a thoughtful response from the EE. With his permission, here it is: 1. I mostly agree with your centrist position. We're not way apart, and he his dead on most of his points and his conclusions. I don't hold out much hope for higher interest rates and disagree that drill-drill-drill by itself is not a great step. It is my understanding that oil fields vary widely and wildly in their marginal cost; the $75/bbl figure he offers would be an average. By opening more fields, I expect they will find some that are more than 75 -- and probably some more than 150. But won't they also locate some more fields that are less than 75? Then they could pump the cheaper ones now at a profit at today's cost. They could leave the more expensive oil in the ground, discounted at his negative interest rate, against future rate increases and expectation of better future extraction technology. Though I think it would be specious, I suggested it might be good politics to open the SPR and tie additional drilling to refilling. This would silence the "won't help for 750 years" crowd, prop up the Obama campaign, and provide instant additional supply without compromising future protections of the SPR. Drain it and refill it with new production. The feds could even hold futures to fill it as part of the bill. Me, Larry, and Paris...
Posted by John Kranz at 10:41 AM
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But johngalt thinks:
I fear this macroeconomics discussion is far above the heads of most of our readers. I know that some of it is over my head. I'll trust JK to ensure it's not mere obfuscation. I will go out on a limb and challenge EEs assertion that nobody is incentivized to extract oil during this period of expensive (I figured about double the typical market price) oil merely because "real interest rates remain low." I can't say much about the effect of interest rates but if I had reserves in the ground I'd be trying to get them to market right now. Posted by: johngalt at August 10, 2008 3:40 PMAugust 6, 2008I'm Just Like Paris HiltonLike Ms. Hilton, I have found a centrist position between two schools of thought on energy. School of thought #1 is well represented by blog friend The Everyday Economist. In an interesting post, Hendrickson links to "an advanced copy of Paul Davidson’s article on oil speculation prior to its publication in the July/August issue of CHALLENGE." I recommend the entire post and linked article, but the EE gives us a synopsis: As I have previously expressed, the rise in oil prices cannot be fully attributed to supply and demand because interest rates are at historically low levels (short-term real interest rates are negative). Thus there is little incentive to extract oil from the ground when the rate of interest is below the rate of growth in the price of oil. Davidson's article recommends the use of the Strategic Petroleum Reserve (SPR) to break speculators, who have bid up the price beyond what Davidson says is supported by supply and demand. I left a long comment on the EE site, but the short version is that I trust a vibrant international commodities market above government manipulation of supply with the SPR, and believe that a large and continuing addition to supply through drilling would have more impact on futures. School of thought #2 is represented by one Lawrence Kudlow. Drill, drill, drill! The drill, drill, drill political scenario coming out of Washington and spreading throughout the country is really helping Fed policy right now. Since President Bush launched his offensive to roll back the drilling moratorium, the oil price has dropped more than $30 from near $150 to below $120. The barrel price is actually down again today to around $118. In connection with the big oil drop, gold has fallen and the dollar has appreciated. Gas prices at the pump have come off about 25 cents. Presumably, headline inflation will moderate a bit next month. Like Paris, I don't find these positions mutually exclusive. Let's open drilling both on the Outer Continental Shelf and in ANWR. Then, let's use the SPR to speed this new production to market, releasing a significant amount with the understanding that it will be refilled from new supply sources. I'm pretty hot myself, huh bitches?
Posted by John Kranz at 5:35 PM
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July 17, 2008Quote of the DayIt's a photo caption: “Senate Majority Leader Harry Reid walks from his Chevrolet Suburban (left) to attend a news conference on energy efficiency Wednesday in Upper Senate Park. Reid rode in the sport utility vehicle from the Capitol to the event, which was across the street.”
Posted by John Kranz at 2:04 PM
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But AlexC thinks:
"We can't drive our SUVs and eat as much as we want and keep our homes on 72 degrees at all times ... and then just expect that other countries are going to say OK." I wish I could remember who said that. Posted by: AlexC at July 17, 2008 4:26 PM
But johngalt thinks:
For those who can't tell AlexC's tongue is planted firmly in his cheek (like I was until I looked up who said this) here's the reference: Link I knew it sounded familiar! :) Posted by: johngalt at July 17, 2008 7:39 PM
But jk thinks:
The competition is quite stiff, but I think that line is my least favorite Obama quote so far (some of our bitter Pennsylvanians might feel differently). As if collectivism isn't bad enough, he has to add knee-jerk Malthusianism to the mix. This quote caused the Wall Street Journal to suggest he was running for the Second Carter Term. July 9, 2008Oil MathWay back in January 2007 some good folks at the Institute for Electrical and Electronics Engineers (IEEE) published the chart below along with an explanation that proposes a "Cubic Mile of Oil" as a new unit of measurement for the vastness of world energy consumption - along the lines of the light-year for measurement of distances in space. I find it more enlightening to use it as a measure of "alternative" energy sources: One commercial wind turbine equals 0.000 000 61 CMO
Before you say, "Wow, a cubic mile of oil must be a tremendously vast amount" consider this: 1 cubic mile of oil would cover the entire state of Pennsylvania to a staggering depth of: 1-3/8 inches. The truth of the matter is that oil is an incredibly high-energy fuel. One gallon of gasoline has the same energy as 63 sticks of dynamite. An average lightning bolt, comprising 500 megajoules of energy, equates to just 3.8 gallons of gasoline. (Think about that the next time you talk on your cell phone while filling your tank!) Click "continue reading" to read the comment I posted to the IEEE article. It's still being vetted by the webmaster. I'm a little late to this conversation (and am amazed there's only 1 comment after all this time) but Mr. Rogers' comment compels me to add one of my own.
Posted by JohnGalt at 3:47 PM
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But johngalt thinks:
I'm bullish on PV electric generation too, because of their passive nature and virtually zero operating cost, but its uses are limited. But be careful about comparing Moore's Law (which applied to integrated circuit density) to the efficiency of solar cells. The latter has a limit of 100% where the former related to size and not efficiency. While something can be miniaturized almost without limit, PV cell efficiency can only double about four times before it reaches the end of the line at 100 percent. At that point its CMO equivalent will be a whopping 0.000 000 000 88. Whew - almost takes my breath away. Posted by: johngalt at July 9, 2008 8:22 PM
But Perry Eidelbus thinks:
Here's some more math. One cubic mile is There are 42 gallons in a standard barrel of oil. So one cubic mile of oil is 26,217,075,000 barrels. World oil production has stagnated at 85 million barrels per *day* for the last three years (and yet there are so many idiots who think there's no supply problem!!!). At current global production levels then, it takes approximately 308.436 days to pump a cubic mile of oil. So to replace what we could get from 308 days of global oil production, it would take 52 nuclear power plants 50 years. Or putting it another way, as much energy as 2600 nuclear power plants will produce in one year, or 3078 nuclear power plants in 308 days. To account for fluctuations, let's say 3000 nuclear power plants. Posted by: Perry Eidelbus at July 9, 2008 10:05 PM
But jk thinks:
If we were on Kudlow, it would be time to bring out the boxing gloves animation -- looks like a ThreeSources Rumble!!!! I exaggerate. But I do disagree with two basic points: -- jg: TJ Rodgers has put considerable money where his mouth is on PV (JG, TJ, PV, JK...) He does not see a limit and when Mister Moore was pontificating at Intel, I would expect only the wildest of futurists imagined the chip I have in my humble little $900 desktop. There is a limit to the energy in a mi3 of oil, there is not technically a limit on how much can be collected from the sun. Whether by nanotech or some yet unseen development, I think today's solar panels will be the 4MHz 286s of tomorrow. -- Perry: You a peak oil guy? Say it isn't so. (Not the Perry I thought I --nevermind). I think the "supply" problem that you describe is a lack of will to drill by the United States, combined with a third-worldism and comfy cartelization of other suppliers. When they find a field, it always seems to produce a lot more than original guesses. New extraction technology rejuvenates legacy fields. Tar sands, anybody? I think there is sufficient oil supply. Jonah Goldberg talks about 19th Century concerns that we were going to deforest the Continental US to power trains. We solved the urban horse manure problem and the deforestation problem (and the whale shortage) with petroleum. Do we really think nothing will come along to supersede it?
But Perry Eidelbus thinks:
"This is not the Perry I knew"? I do believe, firmly, that there's a supply problem. A severe one. And it's entirely man-made, because we're not drilling where we could. At this rate, we *will* have "peak oil," because of the tree-huggers. Posted by: Perry Eidelbus at July 10, 2008 1:55 PM
But jk thinks:
Kumbaya, Brother Perry, we are on the same page after all. A self-imposed supply problem, absolutely. Posted by: jk at July 10, 2008 5:42 PM
But Perry Eidelbus thinks:
I know I did that "Che" thing for April Fool's Day last year, but you should know me well enough by now! :) Posted by: Perry Eidelbus at July 11, 2008 2:27 PMJuly 1, 2008Casey At BatEvery few months some Democrat decides that oil companies are to blame for high prices. Except they're not. It's Democrats who are at fault. This time it's Senator Casey's turn. The federal government is so poorly staffed to investigate oil speculation and price gouging that its agents might as well be “cops going after criminals with water pistols,” said U.S. Sen. Bob Casey Jr. ... because frankly their semi-annual effort has failed. Oil and gas woes dominated the discussion with the editorial board as Casey cast doubts on what he called shortsighted proposals to expand drilling along the U.S. coastline and in the Alaska wilderness. Six months worth of oil: Lie. If we got it all out immediately and refined it and sold it our current consumption rates that's "possibly" what it would take. But you cannot drain an oil reservoir that fast (nor would you want to, you need to replace the oil volume removed with water to maintain pressure). Even the oil volume potentially produced in those six months is not true. You cannot (and the Senate damned sure cannot) forecast advances in oil production and drilling technologies. Oil that was out of reach even 10 years ago is being produced with new techniques. Who's to say what big oil companies or service companies like Halliburton or Schlumberger will develop in the coming years? Don't bet against ingenuity. The 10 years of drilling is also a lie. It does not take 10 years to drill a well. It takes weeks to drill a well... and one rig can only drill one well at a a time. So it might take years to bring more and more wells to production. But first you must do exploration... which usually amounts to dragging microphones over the surface looking for oil. We can't even do that. If we took Senator Casey's (and the Democrat) acreage complaint to heart, it would only lead to more dry holes being drilled. If you do non-invasive exploration and no oil is found, of what use would drilling into nothing be? Of no use. Once a company determines there's potentially oil under a lease, then they do exploratory drilling. If they establish there's financially producable amounts of oil beneath a lease, THEN they go into production mode. In the Alaska oilfields (an area with I have personal experience), if there is a production facility nearby, it's generally a matter of plumbing at that point. However, all of the existing leases have already been explored and re-explored. All the oil that can be found in those location has been identified. So when you hear dishonest Democrats saying "they have 80 million acres of leases"... this is true. But not every acre has oil under it! If oil is discovered, and the nearest processing facility is thirty or forty or fifty miles away, a production facility needs to be built... which means years of environmental permitting and lawsuits. It's not 10 years, it's more like 5. If five years is too far out for oil, why should we spending billions or trillions to tackle .4 degrees of global warming in fifty?
Posted by AlexC at 12:19 PM
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But jk thinks:
Again, do these people do laundry or maintain their property? He is part of the 110th Congress of a 220 year-old nation. I can't see that thinking a whole freakin' decade out is too much for these people. Martin Feldstein has a great piece today on how future supply would lower today's prices. (HINT: it rhymes with Weevil Escalators...)
But johngalt thinks:
Casey's "...area available for drilling" reminds me of the old joke: What are you looking for under this street light?
But Perry Eidelbus thinks:
I've heard 6 years thrown out as the time from drilling to refinement. That still begets the question, so why didn't the Democrats let us start drilling 6 years ago? Oh, they couldn't have predicted the future? Nor can they now. Good examination of the microeconomics by Feldstein, but I didn't see that he boiled prices down to a simple concept: prices reflect supply versus demand, not just in the present time, but in the *future*. All it would take is for Congress to approve drilling in ANWR, and before a single rig is set up, oil prices would start falling immediately. Posted by: Perry Eidelbus at July 1, 2008 4:11 PM
But johngalt thinks:
Exactly right, Perry. And the fact that speculators keep pressing the price higher and higher is proof positive of their conviction that it [ANWR drilling] won't be happening anytime soon. Posted by: johngalt at July 2, 2008 7:41 PM
But johngalt thinks:
Exactly right, Perry. And the fact that speculators keep pressing the price higher and higher is proof positive of their conviction that it [ANWR drilling] won't be happening anytime soon. Posted by: johngalt at July 2, 2008 7:41 PMJune 29, 2008Quote of the DayMy response to those who say that increased drilling is pointless because it won't yield immediate results -- like Arnold Schwarzenegger --is why worry about the greenhouse effect, then? Nothing we do will cool the planet immediately. Yet we're told immediate action there is vital. In fact, we're told that by none other than Arnold Schwarzenegger, in the very same speech. -- Instapundit, Glenn ReynoldsI wonder if these people do laundry ("won't have clean clothes for hours!") or repair their homes ("guy said he couldn't come out to fix the roof 'till Tuesday -- I told him to $%&* off!")? Never have people been so proud to lack any forward thinking.
Posted by John Kranz at 12:46 PM
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A Market Price for Crude OilYves Smith asks in Slate Does Anybody Know How Much Oil There is in the World? The answer appears to be mostly "no" with various technological attempts to measure reserves throughout the world sometimes receiving the climate change slur "junk science." But there is evidence that despite International Energy Agency foreshadowing of current estimates being exaggerated, there is much more oil underground than anyone has previously been led to believe. Indeed, some old oil hands argue that the entire method for computing reserves is fundamentally flawed. Richard Pike, president of the Royal Society of Chemistry, who spent 25 years in the petrochemical industry, contends in an article in the Petroleum Review that published estimates are less than 50 percent of their actual level. As the Independent summarized his argument:Companies add the estimated capacity of oil fields in a simple arithmetic manner to get proven oil reserves. … However, mathematically it is more accurate to add the proven oil capacity of individual fields in a probabilistic manner based on the bell-shaped statistical curve used to estimate the proven, probable and possible reserves of each field. This way, the final capacity is typically more than twice that of simple, arithmetic addition. So what is the actual market-based price that oil would gravitate toward without all the meddling and misinformation on the part of so many disparate interests? Japan's oil minister said, based on fundamentals, the price of crude should be $60 a barrel, not the $130 to $140 we see today. During congressional testimony, five oil-industry CEOs each gave estimates of where oil "ought" to be, with results ranging from $35 to $65 a barrel to $90. Even the implacable Saudis are reportedly about to increase production by half a million barrels a day, a sign that they are concerned that the current price is too high. Yet BP's chief recently said current price levels are warranted, and the oil bulls at Goldman forecast a "super spike" to $150 to $200 a barrel. That last estimate is not really a "market price" figure. It is a speculator's prediction which takes into account all of that meddling and misinformation that won't be going away anytime soon. But what if it did? That's the question the others were answering. Their figures ranged from $35 to $65, or possibly as high as $90 per barrel. This is roughly half of the current "oil shock" price. Yet it's reasonable to expect such prices to return before long. Consider this graph of U.S. gasoline prices adjusted for inflation since April of 1979.
In the much more valuable dollar of 1979, premium gas cost about $1.20 per gallon in 1980 and, interestingly, is about the same price today (although it appears to be trending above that ceiling). But for nearly 20 years between the two "oil shock" periods noted the price was roughly half that - 60 cents per gallon in constant dollars. These various data points give lie to the claim that oil prices are at record highs because the world is "running out" of oil. Instead they show that petroleum based motor fuels have been and continue to be the best bargain since the Louisana Purchase - excluding the backdrop of currency inflation, and absent the efforts of those who wish oil to cost more than their own "pet alternative fuel" preference. Hat Tips: Slate article - The American Magazine; Fuel graph - johngalt's dad. Correction: I had previously titled the graph "world oil prices" since corrected to "U.S. gasoline prices."
Posted by JohnGalt at 11:05 AM
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But Boulder Refugee thinks:
Very well argued, JG. The Refugee attended a computer-related speech by a Chevron exec some time ago. He said that you cannot unlink known reserves and price. In other words, if you say, "What are our reserves at $4/bbl, the answer is zero. Even the Saudi's can no longer produce oil at that price. However, if you say, 'What are our reserves at $200/bbl,' the answer is trillions of barrels. At that price, many options are economical. Recoverable capacity is a function of price." Posted by: Boulder Refugee at July 1, 2008 4:42 PMJune 25, 2008Mad As HellDrop what you're doing and click over to Eidelblog. ThreeSources friend Perry Eidlebus takes on these two adorable little girls: Welcome to the real world, girls. Welcome to the lower quality of life that's inevitable when people let themselves be ruled by environmentalists. Those are the people you should be blaming, girls, not oil companies! Oil companies would love nothing better than to supply us with more oil and gas, and at lower prices: when you do the math, lower prices mean higher sales, so they earn more profit while we consumers still benefit from cheap, plentiful carbon fuels. He even has an adorable picture of a polar bear enjoying a tasty snack. Awesome. UPDATE: Taranto links to an AP pick up of the story. It points out that Sadie "carried a sign asking drivers to honk to lower gas prices" and ends with a sympathetic supporter: "I think it's great," said Hamid Tayeb, who was walking past on his lunch break. "It's unfortunate that kids are doing it before we do."
Posted by John Kranz at 10:47 AM
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June 19, 2008President Reagan on EnergyA nice clip Larry Kudlow ran of his old boss:
Posted by John Kranz at 6:05 PM
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But johngalt thinks:
Damn, I forgot how good it could be to have a conservative president who speaks deliberately and forcefully on principle. Could it have been his acting background? Is it too late to nominate a conservative movie actor for '08? Willis/Romney2008.com Can't you just see President Bruce Willis saying "Yippee Kai Yay..." to Al Gore? Posted by: johngalt at June 21, 2008 1:01 PMJune 12, 2008Drill! Drill! Drill!That's Daniel Henninger's title in today's Opinion Journal column explaining how America is the only nation on earth that refuses to harvest its petroleum reserves. More of this stuff in media on a daily basis is just what this country needs. A tidbit: Nikita Khrushchev said, "We will bury you." Forget that. We'll do it ourselves. I emailed Dan to say, "If we could just get this message onto American Idol where the majority of Americans might see it then Pelosi, Reed and Nelson (and McCain) would change their tunes in a heartbeat." The closing line - hammering McCain - is priceless. I won't copy it here. You gotta go read it.
Posted by JohnGalt at 2:34 PM
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But jk thinks:
This will be a great campaign issue for November as the Democrats put their environmental and regulatory constituencies ahead of the American economy. Then, the GOP nominee can step up to the plate and...oh, wait...never mind... Posted by: jk at June 12, 2008 3:16 PM
But Boulder Refugee thinks:
This is an interesting year of cognitive dissonance for Democrats. The mantra of "The war is lost" is at odds with reality as is the "We can't drill our way out of this" platitude. The Refugee hopes that it takes Americans no more than four months to figure out that Democrats are living in an alternate (and fictional)universe. Posted by: Boulder Refugee at June 17, 2008 2:29 PMJune 8, 2008Get ready for the oil price dropAfter crude oil jumped by $11/bbl in two days, Cato Institute's Alan Reynolds writes that the price hitting $200/bbl in the near future is "quite impossible." Market analysts often claim oil prices are almost entirely determined by supply. Demand is said to be insensitive ("inelastic") to price. The standard example is that many Americans have to drive to work and most gas-guzzling SUVs will still be on the road even if the affluent few can trade theirs for a Prius. Whatever the price, we'll pay it. Reynolds goes on to explain that industrial use of oil fuels is already declining in most sectors, one of which we witnessed last week as airlines parked planes, cancelled some routes and reduced employment. But even without a US recession, Reynolds says, oil prices will still fall with industrial declines elsewhere. In the United States and Britain, industrial production is nearly flat - only 0.2 percent higher than it was a year ago. In many other countries, however, industrial production has dropped over the past 12 months. It's down by 0.7 percent in Japan, 1.1 percent in Austria, 2.5 percent in Italy and Denmark, 2.9 percent in Canada, 5.4 percent in Greece, 5.7 percent in Singapore and 13.3 percent in Spain. My college physics professor took great joy in explaining that alarming trends, such as population growth, never continue at the same rate for a very long time. The meteoric rise in the cost of oil is yet another of those trends. Hat tip: 'The American' magazine
Posted by JohnGalt at 12:24 PM
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But AtTheWaterCooler thinks:
Great research, I linked to your post from Time to sell oil futures short? Posted by: AtTheWaterCooler at June 11, 2008 2:09 PM
But jk thinks:
Thanks for the link. As far as shorting oil goes, I think the old joke applies here: "The market can remain irrational longer than you can remain solvent." - John Maynard KeynesPosted by: jk at June 11, 2008 6:58 PM June 6, 2008The Perfect Pigouvian TaxJim Glass takes Mankiw's Pigou Club to new heights. Imagine a simple, single tax that can help avert global warming, de-fund Arab terrorists, save scarce natural resources, reduce pollution AND remedy the government's approaching funding crisis for Medicare (by heading off the coming diabetes epidemic, etc.) ... save private individuals billions of dollars of medical costs from avoided heart attacks and strokes and blood pressure medication prescriptions ... make the general population lean and good looking ... and improve your sex life too! That's the Fat-Gas Tax. What's not to love? Hat-tip: Don Luskin.
Posted by John Kranz at 11:08 AM
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May 30, 2008More On AlgaeI tried but failed to sell JohnGalt on being an early adopter for Algae farmin' (or is that Ranchin'?) Just choosing which kind of algae to start with is a herculean task. There are well over 100,000 species, each adapted to grow in different environments at different rates, and each capable of producing different amounts of oil—or none at all. The government collected more than 3000 different strains from all over the world in the 1980s, 300 of which were deemed promising. Today, many algal strains have been engineered into genetically modified superplants—the secret formulas of biofuel startups—but there is, as yet, no proven winner. Not to mention, there remains the small matter of how to make the algae flourish, how to cheaply dry several million gallons of subsequent slush, and how to get the oil out of minuscule cell walls and into the metaphorical barrel. At the end, I have to think that straight photovoltaics offers a rosier path, with T.J. Rodgers saying that Moore's Law will apply to PV. Yet I still find the algae story intriguing.
Posted by John Kranz at 2:25 PM
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But johngalt thinks:
"Today, many algal strains have been engineered into genetically modified superplants..." Visions of Cylon Centurions dance in my head... Posted by: johngalt at June 3, 2008 11:42 AMMay 27, 2008Democrats and Gas PricesThe truly scary thing is that Democrats might actually use their stance on energy to augment their leads in the House and Senate. Even NYTimes writers are laughing at them: The lawmakers played their parts, too — showing mostly outrage and fury. “You all are gouging the American public and it needs to stop,” declared Representative Steve Cohen, Democrat of Tennessee. Other Democratic lawmakers openly questioned whether the companies were illegally fixing prices to hoard profits and voiced suspicions that they were in cahoots with Vice President Dick Cheney to enrich the energy industry. Hat-tip: Gregory Mankiw, who excerpts Rep. Waters's quote and says "Oh Yeah, That Should Work"
Posted by John Kranz at 6:16 PM
Wi-Fi AllergyStop the earth - I want off. Seriously, didn't most people have that same reaction to the 1970's nutjobs who wanted to outlaw drilling for oil in this country because it was "dirty?" Leave the idiots alone and look what it gets you - politicians who say things like "gasoline prices are not based on supply and demand, they're being driven up by reckless speculators and obscene oil company profits" and "we can't drill our way out of this problem" when, in fact, that is the ONLY way to bring gasoline prices down. And it makes us "less dependent on foreign oil" at the same time.
Posted by JohnGalt at 3:33 PM
May 13, 2008Cap'n TradeThe Wall Street Journal Ed Page nails all the failings of Senator McCain's proposed Cap and Trade program for carbon credits: The problem is that once government creates an artificial scarcity of carbon, how the credits are allocated creates a huge new venue for political rent-seeking and more subsidies for favored industries. Some businesses will benefit more than others, in proportion to their lobbying influence and how well they're able to game the Beltway. Congress itself will probably take the largest revenue grab, offering itself a few more bites out of the economy and soaking politically unpopular businesses. Where I am not sure they are right is the politics: But he will never be green enough for the climate-change fundamentalists. The Obama campaign and Democrats were already dinging Mr. McCain yesterday for half-measures. His concessions won't help him much in November, but they will make his governing decisions in 2009 that much more difficult if by some chance he does win. My YouTube question for the GOP Debate was to ask which, if any, of the candidates would stand up and say that climate change is not sufficiently proven to threaten disruption of the energy markets. I was looking for somebody brave enough to say that it might be "hooey." But we have the best candidate for 2008. I sure wish Senator McCain would propose something less intrusive than C&T, but I will concede that the "denier" I was looking fir would not have a chance in this "tick! tick! tick!" climate. It's Game Over and we have lost. I'd rather elect a free trader even if he is badly misguided on this issue.
Posted by John Kranz at 11:42 AM
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But Boulder Refugee thinks:
Just when I was starting to warm up to McCain, he pulls this loo-loo (pun intended). I was thinking, "Wow, we can really draw a stark contrast against Obama based on policy, because we sure aren't going to win on personality." It's a small consolation to realize that I was half-right. Posted by: Boulder Refugee at May 13, 2008 1:36 PM
But jk thinks:
It's real bad, br, I cannot dress this pig up. But, as Larry said, we all knew it was coming. It will be hard to stay enthusiastic this fall, but it is worth it for free trade and the continued existence of Israel. Posted by: jk at May 13, 2008 4:48 PMMay 7, 2008Do You See The Light?Support for Ethanol subsidies are now out of favor with the green elite. According to a WSJ editorial, the WaPo and TIME magazine have both "concluded that food-to-fuel mandates have failed." All we can say is, welcome aboard. Corn ethanol can now join the scare over silicone breast implants and the pesticide Alar as among the greatest scams of the age. But before we move on to the next green miracle cure, it's worth recounting how much damage this ethanol political machine is doing. Just because everyone now knows it's a sham, don't look for subsidies to be repealed, mandates to be lifted or tariffs on imported Brazilian sugar cane to be reduced. And that's another trouble with gub'mint solutions. Perhaps the mandates might be scaled back, but the subsidies will be around 'till the end of time. As far as I know, the Federal government still subsidizes mohair because it was a vital component in WWI military uniforms. Will anybody learn? It was clear from Senator Obama's speech last night, that the Democrats are poised to double down and harness the power of Government to "create millions of green jobs, &c..." I love Megan McArdle’s' take: Gack. Now Obama is ranting about how he's going to make the corporations give us super fuel-efficient cars, find awesome new sources of oil, make renewable energy affordable, and invent a really delicious fat-free ice cream. However did we manage to get through the first 200 years without Barack Obama to beat some progress out of the corporations that have been holding us back?
Posted by John Kranz at 12:44 PM
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But mdmhvonpa thinks:
The 17 bazillion gallons of H2O is incorrect ... corn for fuel is not irrigated like food-stock corn. Posted by: mdmhvonpa at May 7, 2008 3:11 PM
But jk thinks:
Interesting -- is fuel corn significantly different from feed corn? I'm city folk, the accent is just affectation. Posted by: jk at May 8, 2008 10:02 AM
But johngalt thinks:
Under the heading "You learn something every day" some non-irrigated hybrid corn varieties apparently can out-yield the best irrigated varieties: http://www.garstseed.com/GarstClient/GarstNews/news.aspx?NewsItem=10101 May 6, 2008Getting. Dumber. All. The .Time.Blog Brother AlexC is flying (one of them newfangled Wye-Fye planes, I guess) and sends a link to MyDD: Make it against the law for oil companies to pass the price of the windfall profits tax on to consumers, and then audit the oil companies' books. It is not a difficult accounting exercise to tax excess profits above a certain gross percentage per barrel of oil, or gallon of gas. Every major oil company has sophisticated profit segmentation reports that go to the very senior management of the company. These reports identify revenues, costs and profit at each level of the vertically integrated operation, broken down on a per barrel basis by product type, marketing region, you name it. And if they pass along the cost of this tax, we'll...
Posted by John Kranz at 2:56 PM
1,147th. Dumbest. Idea. Ever.ThreeSources friend Everyday Economist has signed an Open Statement Opposing Proposals for a Gas Tax Holiday. Being a fair guy, he also provides a link to Bryan Caplan, who disagrees. The American people want to "do something," and Hillary's tax cut will at least do little harm. I think I'll throw my lot in with Caplan on this. I think the holiday is a gimmick and I think it will be completely ineffective and likely counterproductive and it's stupid and it will never happen. But this is campaign season with daily displays of foolish gimmicks and bad policy. I don't know that I'd pick this one to sign a petition. (In fairness, ex-guitar player would not be sufficient academic credit if I wanted to.) Having three active candidates provides a bad idea every eight hours. The summer gas tax holiday seems, like Caplan says, one of the least harmful. The discussion around it has been rather informative. Senator McCain all but admits that it's a gimmick, but he just wants to give a little guy a little break. Senator Clinton wants to "pay for it" with a big tax on oil companies. Senator Obama gets points for recognizing its gimmickry, but I take a couple off for laughing that "it will only save 28 bucks!" If you live in a $3M mansion, $28 per person may seem laughable. But to masses of bitter white trash, Senator, that's a lot of arugula down at Whole Foods. Stupid, yes. Compared to cap-and-trade for CO2, socialized medicine, re-importation of pharmaceuticals, windfall profits taxes, it seems pretty harmless.
Posted by John Kranz at 11:10 AM
May 4, 2008Dumbest. Plan. Ever. WSJ's Take.Here's what the WSJ editorial page has to say about Obama's election year plan to lower gas prices by raising the marginal corporate tax on oil companies ABOVE it's present level of 35%: Mr. Obama is right to oppose the gas-tax gimmick, but his idea is even worse. Neither proposal addresses the problem of energy supply, especially the lack of domestic oil and gas thanks to decades of Congressional restrictions on U.S. production. And about energy policy politics in general: This tiff over gas and oil taxes only highlights the intellectual policy confusion – or perhaps we should say cynicism – of our politicians. They want lower prices but don't want more production to increase supply. They want oil "independence" but they've declared off limits most of the big sources of domestic oil that could replace foreign imports. They want Americans to use less oil to reduce greenhouse gases but they protest higher oil prices that reduce demand. They want more oil company investment but they want to confiscate the profits from that investment. And these folks want to be President? But there is hope: Late this week, a group of Senate Republicans led by Pete Domenici of New Mexico introduced the "American Energy Production Act of 2008" to expand oil production off the U.S. coasts and in Alaska. It has the potential to increase domestic production enough to keep America running for five years with no foreign imports. With the world price of oil at $116 a barrel, if not now, when? So does the AEPA have a chance of passing instead of the CREPPA? The chances may be slim but as Wayne Gretzky used to say, "You miss 100% of the shots you don't take."
Posted by JohnGalt at 1:46 PM
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But johngalt thinks:
Shamelessly commenting on my own post- Disregard for a moment whether either of the proposed Acts would or could actually achieve its stated goal and instead consider the competing intents: D-PA: "Reasonable" energy price protection for consumers. R-NM: American energy production. That pretty well sums it all up, doesn't it? Posted by: johngalt at May 5, 2008 3:21 PMMay 2, 2008I'll Stand Up For GrandpaThe Wall Street Journal Ed Page discusses the Rockefeller Scions who are beating up on Exxon-Mobil for, well, selling oil. One luxury of being a Rockefeller is that you are wealthy enough to live in style even if Exxon's performance starts to slide. The same can't be said of millions of pensioners and small investors for whom Exxon's profits may be the main source of a secure retirement. If John D.'s heirs aren't satisfied with Exxon, they're welcome to invest elsewhere. Our guess is that few will, given how much money they've made over the decades on fossil fuels. Companies create value for shareholders, that's their highest calling. I defended Google against freedom lovers on that account, I certainly will defend XOM against whiny, pampered heirs. Larry Kudlow tore into the scions last night: "they've never seen an oil field, they've never worked a day in their life..." (Especially Senator Jay, I'd add.) But I come to praise John D. We call him a robber baron, but he made his money bringing heat and light to poor people. Bastard! Rich folk could buy wood or whale oil and have servants to tend it. Rockefeller brought five cent gallons of kerosene to the masses, who could now read or work past dark. He used more of the harvested oil than his predecessors who cracked it for a small part and threw the rest away. Then, of course, he devoted much of his fortune to philanthropy. We should be building statues and not calling him names. And, as the WSJ says, if the grandkiddies want to invest in windmills or perpetual motion (algae maybe?) they certainly can.
Posted by John Kranz at 1:03 PM
May 1, 2008Pretty CoolBiofuel from algae? Selective hydrocarbon out? This seems pretty cool: The highlight says "[W]e could grow all the fuel the United States needs using 1/10th of the land space of New Mexico." My musical career used to entail criss-crossing the great state of New Mexico. One tenth of its area is pretty big. All the same, it sounds more efficient than Ethanol. Maybe some of the "Big Algae" Senators will step up to the plate and subsidize this! Hat-tip: His Instyness.
Posted by John Kranz at 1:14 PM
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But johngalt thinks:
Well, if efficiency compared to ethanol is the yardstick then just about everything is an improvement. Posted by: johngalt at May 2, 2008 3:51 PM
But jk thinks:
I hear you. Though I was giving this credit for being potentially magnitudes more efficient. Instapundit once also linked to a home ethanol distiller that cost $9995 and brewed $1/gal Ethanol out of sugar. The algae project does not intrigue me about covering 10% of New Mexico. But I do wonder about making a 20' diameter silo that could sit on a fellow's farm in, say North Central Colorado that could fuel all its owners vehicles, heaters, and itself. Crazy talk? Posted by: jk at May 2, 2008 4:40 PM
But johngalt thinks:
"And itself?" Perpetual motion machine? In the video I see an electrically circulated solution being exposed to solar radiation, so I guess that's a principal input. And plants require CO2 for respiration (or whatever you call it in plants) so that's another input. But the plants I grow (various forage grass species) also require nutrients. This spring's crop just received $1000 worth of petroleum derived nitrogen fertilizer. I'll need to see the complete cycle diagram with cost inputs before I invest in this plumber's nightmare. One thing I DIDN'T see in the video was the giant vessel of "vegetable oil" produced at this quite impressively sized plant. In north central Colorado I'll also have to shut it down and winterize it in late September. For a system primarily powered by solar energy I'm still leaning toward organic photovoltaic panels. (But not until all the fossil fuels are depleted - probably not in my lifetime.) Posted by: johngalt at May 4, 2008 1:44 PM
But jk thinks:
Perhaps it's not for a sober, measured man such as yourself. I was thinking of a Randian family with some millenarian, survivalist instincts who would pony up a little extra to get "off the grid" and enjoy self sufficiency. Winter would suck (New Mexico looks better and better) but I have no problem envisioning this as viable. It's not perpetual motion; it is essentially a solar play. My memories of pond scum would suggest that they don't require too expensive a nutrient medium. I agree that I'd like to see the vegetable oil or the jet fuel before I signed up -- how complex is the extraction? Compared to Ethanol, jg...
But johngalt thinks:
Oooh, sarcasm - I LIKE it! But I've already told you how I'm going to get off the grid: http://www.threesources.com/archives/005036.html And I can use the waste heat to warm my wife's new riding arena in the winter. I do need to work on a large capacity electrical storage system though. Electrochemical batteries are so passe. Hey, I know: hydrogen fuel cells! Posted by: johngalt at May 5, 2008 3:29 PMApril 29, 2008Global Food CrisisNot content with helping Senator Obama to a victory in Pennsylvania, Senator Casey turns to solving the global food crisis. How? President Bush had previously requested $350 million for the year. Durbin and Sen. Robert P. Casey Jr. (D-Pa.) held a press conference Monday calling for an additional $200 million in food aid to be added to the upcoming war supplemental bill. Oh, and let's give it to the UN, of all people. A model of efficiency. The President doesn't escape blame, but is anyone in government willing to look at the real cause of the global food crises? Government. ... specifically the US and EU mandates for Ethanol production and consumption. When it pays better to burn food for fuel than it does to sell it for food, is anyone, outside of Democrats and liberal do-gooders, really surprised?
Posted by AlexC at 2:58 PM
April 19, 2008OutgassingInsty links to a topic near and dear to my heart: where does oil come from? We all learned in school that it's rotten dinosaurs, everybody knows that. When everybody knows something, look out. When I was in college, I was in a band with a PhD candidate in Physics (who was a pretty good guitar player as well). He had me over for dinner one night with the former President of the school, Dr. Sterling Colgate. Colgate has forgotten the cube of the physics I'll ever learn and was a fascinating personality. This was in the late 70s when world oil supplies were a concern, and Dr. Colgate was adamant that the Earth, like most every other celestial body its size, was kicking out more hydrocarbons than we puny humans could ever be expected to burn. I was young and took the word of my intellectual betters. For better or worse, I have believed this ever since. The core of the planet "outgasses" small hydrocarbons and the pressures in the crust produce larger molecule versions. I never hear this discussed at any level. Until today: What does Gold have to do with the recent Brazil oil find? In 1999, Gold published "The Deep Hot Biosphere," a paper that postulated that coal and oil are produced not by the decomposition of organic materials, but in fact are "abiogenic" -- the product of tectonic forces; i.e., deeply embedded hydrocarbons being brought up and through the earth's mantle and transformed into their present states by bacteria living in the earth's crust. I feel like a 9/11 truther or something, but I find this theory a lot more believable than the dead dinosaurs.
Posted by John Kranz at 12:03 PM
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But pquist thinks:
I recall reading Gold's theory in the late 70s or early 80s in the WSJ. Like you, I have never been able to totally discount the idea. The view that oil derives from fossils is dominant, but I do not believe that it can be proven. Posted by: pquist at April 20, 2008 4:02 PMMarch 3, 2008I'm Thinkin' 't He's Drinkin' 'tRobert Zubrin did a podcast with Glenn Reynolds a while back, and I am thinking that he slipped a bit of biomass ethanol into the good Professor's drink. Glenn has since run about 754 positive blurbs about "The Zubrin Plan" to mandate that new cars sold in the US can run on gasoline or ethanol. "You had me up until 'mandate,'" says I. The proponents wash over the mandates with the assumption that these will replace other and worse pieces of legislation. The way Professor Mankiw sells his carbon tax as being better than cap and trade, The Zubrin Plan is always better than some other government abomination -- yet there's very little evidence our benighted 535 won't give us both. Reynolds and Zubrin claim it is better than CAFE standards and are likely right. But how bad would increased CAFE standards and mandated flex-fuel capability suck? Zubrin defends himself from the mean old attackers at Science Magazine and the WSJ Ed Page -- and Reynolds dutifully links. Where Reynolds likes biomass ethanol, Brother Zubrin is still pretty pleased with the corn ethanol subsidies. By his math they provide a 600% ROI: Let's start with the allegedly misbegotten incentives. The United States invests roughly $3 billion a year through a 51-cent per gallon credit to promote the production and use of renewable fuels like ethanol. The return on that investment? Taxpayers are saving approximately $6 billion that would otherwise be spent on counter-cyclical crop price supports, plus an additional $15 billion reduction in the country's petroleum import bill. "The attacks continue." "That, not a blind and dangerous reliance on the status quo, should be our course." Defensive much? It's like watching Senator Clinton complain about getting the first question at debates. I remain pretty excited about biomass. But I don't want to mandate solutions onto car manufacturers. Mr. Zubrin does his cause no favors with a petulant essay.
Posted by John Kranz at 3:00 PM
WSJ: Supply-Demand Thingy Works!As crude-oil prices climb to historic highs, steep gasoline prices and the weak economy are beginning to curb Americans' gas-guzzling ways. The article then points out that a rally in crude prices has kept this from feeding back into lower gas costs, so don't reprint the textbooks just yet. I point it out because I see a new promising free market solution to our soi disant oil addiction every week, and yet the insane calls for gub'mint solutions come every day. I think Economics textbooks will be updated in a few years to include the folly of subsidizing corn-based ethanol. A corn-producing state has two powerful Senators, one in either party, so the government throws [insert magnitude here]s of dollars at a "solution" which costs more, requires more energy, and emits more greenhouse gases -- a policy trifecta!
Posted by John Kranz at 11:24 AM
February 15, 2008A Green HeroFree market deity, T.J. Rodgers, is bringing Moore's Law to Solar Power. He wants to save the world and make a pile of cash. What a guy! I had a brief and very unsuccessful stint in my younger days selling ad space for "Photovoltaics Magazine." My problem was that I was not a good closer; the PV industry's problem was that it competed for Silicon with the likes of Intel and Texas Instruments. One sold a square inch for $300 and one sold 4 x 8' sheets. You get the idea. Rodgers saw a similarity others did not: Moore's Law. It was a semiconductor industry and the advances in chip fabrication would pay off in solar power. He bought a power company with his own money when his board would not go along and now "SunPower is rapidly becoming a more important business to Cypress than semiconductors themselves." So, it goes without saying that when the word "green" comes to mind, T.J. Rodgers, the ultimate free market libertarian, is probably the last person you'd ever think of. And yet, here he is, at the absolute epicenter of the Green Revolution, helping lead the charge that will likely very soon make solar power as inexpensive as other sources of electricity. These are from a great piece by Michael Malone on abc.com. Read it all and send a copy to your favorite Democrat.
Posted by John Kranz at 3:29 PM
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But johngalt thinks:
A fledging Loveland, Colorado company named AVA Solar is on the verge of pilot production of a new type of low-cost photovoltaic panel. They claim to have an infrastructure cost comparable to the same kwh generating capacity using fossil fuels. The difference, of course, is that operating costs for solar photovoltaic are virtually zero since there is no fuel cost. I believe a German company is already in production with a similar technology. It appears that solar electric generation is on the cusp of an energy economy revolution that will make ethanol, biodiesel and methane composters seem like just a bad dream. You may have noticed that hydrogen fuel cells are missing from my list of failed energy gambits. That is because hydrogen is not a fuel, and fuel cells are not engines. Instead they are analogous to batteries and have the capability of being "charged" by solar photogenerators. I'm not endorsing this, just saying that it will remain a competitor for future energy storage applications. (At least until the first "Hinden-yugo" explosion on an urban motorway.) February 7, 2008A Physics HossI am linking to a one hour and 35 minute video. It's a huge investment. But I know we have some geeks around here and I encourage each to ignore politicians and pundits and spend some time with a true genius. (Hat-tip: Samizdata. Dale Amon says "For those who have not spent a lifetime watching the world of Physics, Dr. Bussard is one of the elders of the field. He is no outsider and no crank. He is one hell of a serious physics dude." The talk is all Physics, but quite a bit of politics and economics unwittingly enters. ABSTRACT This is not your father's fusion reactor! Forget everything you know about conventional thinking on nuclear fusion: high-temperature plasmas, steam turbines, neutron radiation and even nuclear waste are a thing of the past. Goodbye thermonuclear fusion; hello inertial electrostatic confinement fusion (IEC), an old idea that's been made new. While the international community debates the fate of the politically-turmoiled $12 billion ITER (an experimental thermonuclear reactor), simple IEC reactors are being built as high-school science fair projects. Have fun: http://video.google.com/videoplay?docid=1996321846673788606
Posted by John Kranz at 12:11 PM
January 15, 2008Jeremy!It is probably too late to start a draft Jeremy Clarkson for President campaign, Especially since we would need to amend the Constitution to allow the foreign born star of Top Gear to hold the position. And his general contempt for America and her people would be a PR challenge. But I still wonder: A couple of weeks ago, plans for a wonderful new coal-fired power station in Kent were given the green light and I was very pleased. Senator McCain he ain't! Hat-tip: Samizdata
Posted by John Kranz at 5:11 PM
January 4, 2008Uniquely AmericanYou see one of these "Cold Fusion" stories every month or so. I'm still waiting for the nation to be powered by the scraps from the Tyson poultry plant. Yet I hope that this one is true because it represents a uniquely American solution. “Check it out. It's actually a jet engine," says Johnathan Goodwin, with a low whistle. "This thing is gonna be even cooler than I thought." We're hunched on the floor of Goodwin's gleaming workshop in Wichita, Kansas, surrounded by the shards of a wooden packing crate. Inside the wreckage sits his latest toy--a 1985-issue turbine engine originally designed for the military. It can spin at a blistering 60,000 rpm and burn almost any fuel. And Goodwin has some startling plans for this esoteric piece of hardware: He's going to use it to create the most fuel-efficient Hummer in history. Goodwin takes the largest American cars and fits them with electric drive and a fat burning jet 60KRPM jet to recharge supercapacitors. "Like a Prius on Steroids," he says. Well, Mr. Goodwin, I know Steroids. Steroids are a friend of mine. And your solution goes beyond steroids. Let our beloved, European allies buy smaller and less powerful cars. Whether Goodwin's approach ever sees an integral market share or not, this is the way for Americans to beat the "fuel crisis:" with big, fast, mighty cars, If it indeed runs on french-fry grease, we might just get energy-independence after all. Hat-tip: Insty
Posted by John Kranz at 4:22 PM
October 28, 2007Imagine..."Imagine if a two hundred and fifty year supply of energy were right here at home." "Black hydrogen" never looked so good. Hat tip: Blog brother Cyrano.
Posted by JohnGalt at 3:14 PM
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But jk thinks:
I'm sold on coal. Posted by: jk at October 28, 2007 5:16 PMSeptember 30, 2007Did somebody say bubble?The NYTimes reports an ethanol "glut." Only last year, farmers here spoke of a biofuel gold rush, and they rejoiced as prices for ethanol and the corn used to produce it set records. We did talk about an alternative energy bubble last week. As long as Senator Grassley breathes, however, I think ethanol providers are safe. And the article makes clear that the problem is not a lack of demand as a lack of distribution, so I am not flying my schadenfreude flag just yet. UPDATE: The WSJ weighs in as well:(paid link) Financing for new ethanol plants is drying up in many areas, and plans to build are being delayed or canceled across the Midwest, as investors increasingly decide that only the most-efficient ethanol plants are worth their money.
Posted by John Kranz at 1:43 PM
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But mdmhvonpa thinks:
Watch for an interesting flux in the (corn) feed futures. Posted by: mdmhvonpa at October 1, 2007 10:32 AM
But Perry Eidelbus thinks:
I wonder when the American corn industry will do as French winemakers have, and demand more government subsidies so they don't lose money from the glut that government subsidies created in the first place. Posted by: Perry Eidelbus at October 1, 2007 1:18 PM
But jk thinks:
The WSJ article goes on to say that ADM and the big players will still do well, so I think you have a Baptists & Bootleggers alliance that will keep Grassley and Harkin out. ADM will use the downturns to buy the little guys. Posted by: jk at October 1, 2007 3:27 PM
But TrekMedic251 thinks:
Well,..there may be a good side to this. With a corn glut, tacos will be cheaper in Mexico and that should decrease the flow of illegals into the US,....um,....right?? Posted by: TrekMedic251 at October 2, 2007 10:15 PMSeptember 22, 2007The Power of RegulationProfessor Reynolds links to this as good news: "The economist reports that Concentrating Solar Power (CSP) systems that capture and focus the sun's rays to heat a working fluid and drive a turbine, are making a comeback. Although the world's largest solar farm was built over twenty years ago, until recently no new plants have been built. Now with the combination of federal energy credits, the enactment of renewable energy standards in many states, and public antipathy to coal fired power plant, the first such plant to be built in decades started providing 64 megawatts of electricity to Las Vegas this summer. Electricity from the Nevada plant costs an estimated 17 cents per kilowatt hour (kWh), but projections suggest that CSP power could fall to below ten cents per kWh as the technology improves. Coal power costs just 2-3 cents per kWh but that will likely rise if regulation eventually factors in the environmental costs of the carbon coal produces." To be fair, Instapundit doesn't give it a glowing endorsment, but the link asks "A BRIGHT FUTURE for large-scale solar farms?" I expected to read of a technological breakthrough in Photovoltaics, inspired by nanotechnology -- or something. Instead I read that Federal regulation and "public antipathy" are now deemed sufficient to rethink a process that is six times less efficient than existing mechanisms. Oh boy. Where can I go long public antipathy? I think that's a growth market.
Posted by John Kranz at 5:08 PM
August 30, 2007Big Oil CollusionAre you sure about that? Big oil companies did not conspire to raise U.S. gasoline prices last summer, as it was high crude oil costs and supply problems that caused the spike in pump prices, government investigators said on Thursday. So what they're saying is that fluctuations in supply and demand cause prices to go up (and down?) Not some cabal of evil white men? Get outta here.
Posted by AlexC at 3:33 PM
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But jk thinks:
They buried the lede: 25% was caused by ethanol mandates (government intrusion). It was evil white men, ac -- Sen Harkin, Sen Grassley, Sen Lugar, Sen Durbin... Posted by: jk at August 30, 2007 4:09 PM
But johngalt thinks:
OK, I'll be your conspiracy theorist. Ever notice how gasoline prices rise quickly and fall slowly? My hypothesis is that the retail price rises immediately whenever the wholesale price goes up, but when the wholesale price drops the retailers only lower their price as much as they have to as dictated by their nearby competition. Not everyone plays this game, however. While 91 octane premium still commands 3.13 to 3.35 per gallon (north Denver metro) Costco gasoline has been selling their Sinclair wholesaled 91 octane for 2.99 for at least a month. Posted by: johngalt at August 30, 2007 11:55 PM
But TrekMedic251 thinks:
JK,..I direct you to this piece on ethanol: http://www.philly.com/inquirer/opinion/pa/20070828_Kudos_to_kudzu_as_source_of_energy.html Posted by: TrekMedic251 at September 1, 2007 1:05 PM
But jk thinks:
I liked it just fine until they suggested genetically modified kudzu. I'm no Luddite, but one can easily see GMK taking over and destroying all life on Earth. I'm actually very keen on biomass energy and have long been intrigued with generating power from poultry offal and by-products. Just as long as it's neither subsidized nor mandated, sign me up. July 24, 2007No War but the Price WarA price war with the Hess station across the intersection at Union Boulevard and Airport Road had seen gas prices down more than a dollar a gallon. The margins on pump gas are so incredibly low (pennies per gallon to the retailer) that the majority of the station's profit is generated from burnt coffee and old hot dogs. But losing a buck a gallon doesn't seem like it could go on very long.
Posted by AlexC at 1:48 PM
July 21, 2007Drilling Ordered to StopA federal appeals court has ordered Shell Oil to stop its exploratory drilling program off the north coast of Alaska at least until a hearing in August. Oil is at $75 per barrel in case you missed it.
Posted by AlexC at 12:05 PM
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But jk thinks:
The Ninth Circuit -- wow, that will never be overturned... Posted by: jk at July 21, 2007 12:48 PM
But Perry Eidelbus thinks:
I can't help but wonder what's in these judges' portfolios... September 07 crude was almost $76.50 on Friday, the day after the announcement. August 07 gasoline was over $2.15 -- the wholesale price, mind you. Prices have dipped a little since, but only a little. And then you have all the idiots who cry "gouging" when it's the courts that **** things up like with this bull**** ruling. From a purely business standpoint, there's no such thing as raising prices only when the more expensive shipment arrives. Gas stations have to raise prices *today* so they can afford to buy the next shipment. Posted by: Perry Eidelbus at July 24, 2007 4:26 PMJune 22, 2007Again, Bullwinkle?That trick never works. So say Senators J. Bennett Johnson and Don Nickles in a guest editorial in today’s Wall Street Journal. (Paid link, TNSTAAFE[ditorial]) If the American people are suspicious of bold pledges from Washington about energy independence and reform, they have good reason to be. Since the first energy crisis almost 35 years ago, our nation has had a very expensive education in such matters. Whether it was President Nixon's Project Independence that called for the elimination of foreign oil imports, or President Carter's mandate that 20% of all domestic energy be supplied by solar technologies -- both of which were set to be achieved by 2000 -- projects have come and gone to no avail. They then enumerate a frightening list of Congressional intrusion: price-gouging, alternative energy mandates, renewable fuels standards, windfall profits tax, &c. The bipartisan team, to be fair, hails from the oil states of Oklahoma and Louisiana. But they puncture each mandate and ask the current Congress to "recognize and act upon the difference between hope and reality."
Posted by John Kranz at 12:15 PM
June 20, 2007Thirtieth BirthdayA project to which I quite literally owe my livelihood to celebrates it's 30th birthday today. Figurin' that I'm about thirty years from retirement, here's hopin for another thirty!
Posted by AlexC at 7:57 PM
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But jk thinks:
I'm hoping for 30 years of ANWR oil as well. Posted by: jk at June 21, 2007 9:42 AMJune 4, 2007Regulating Gas PricesYeah, this will work. State Rep from Washington County Mike Solobay wants to regulate gasoline like milk, and wants to duplicate a bill California drafted years ago. "It basically set up a board similar to our Milk Marketing Board, but it gave the authority to a public utility commission to regulate the pricing and cost of what the pricing could be for fuel and processing of gasoline and different oil products." Did anyone notice that milk, like cigarettes are sold at state minimum prices? Those prices are act as an artificial floor for cigarettes and milk. The government of Pennsylvania is actually costing you money. Milk and smokes could be cheaper. Really. Think of the millions of poor who are overpaying for those sundries. What "needs" to be done is setting a state maximum price for gas... which always leads to shortages. If the high cost of fuel is really a problem, surely the state could forsake it's cut of your gallon of gas. They didn't drill for it. They didn't produce it. They didn't refine it. They didn't deliver it. They didn't store it. They didn't even sell it! Pennsylvania collects $0.32 per gallon of gas. How much would that save you per week? He's a Democrat, btw...
Posted by AlexC at 12:19 PM
May 25, 2007Gouge 'emThe lead WSJ Editorial today suggests that Congress look in the mirror if it wants to know who is causing "excessive" gasoline prices. The big anti-gouging law will only enrich a few lawyers. What does "gouging" mean anyway? No one on Capitol Hill can answer that question. The House bill prohibits energy companies from charging a price that is "unconscionably excessive." There's a precise legal term. It further explains that it shall be a crime whenever "the seller is taking unfair advantage of unusual market conditions" or "the circumstances of an emergency to increase prices unreasonably." Now that this law has passed, prices are sure to plummet. UPDATE: link changed to free site -- thanks to johngalt.
Posted by John Kranz at 7:11 PM
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But johngalt thinks:
The link was public this morning: http://www.opinionjournal.com/editorial/feature.html?id=110010132 Posted by: johngalt at May 28, 2007 12:04 PM
But johngalt thinks:
The line that caught my eye, and sent me looking for the story, was this one: "Now that this law has passed..." What? Did the Senate vote on it? Has the president signed it? No, it appears that only Pelosi and Soros' House of Representatives has passed it. Once actual grownups begin debating this measure, sponsored by the aptly named "Bart Stupak" (D-MI) someone is sure to point out that it will cause gasoline shortages during price spikes. Faced with the government imposed alternatives of selling their product at a loss or comitting a felony, retailers will do neither. Instead they'll just turn off the pumps and wait for the government to cave. Bart STUPak needs to read this cartoon and the 'Who is Gouging Whom?' excerpt that follows it. Posted by: johngalt at May 28, 2007 12:15 PMMay 21, 2007Sounds like my diet...I have had this story in a browser window all day. I don't know what to say but it is too good not to share. The Wall Street Journal details (paid link, sorry) what pig farmers are feeding their livestock as corn is being diverted to Ethanol production. GARLAND, N.C. -- When Alfred Smith's hogs eat trail mix, they usually shun the Brazil nuts. Of course, if we did not provide 50 cents a gallon subsidies for Ethanol and apply 51 cent tariffs to a gallon of Brazilian Ethanol -- never mind, you know the rest. My wife just hopes they don't find a way to make biofuels out of coffee.
Posted by John Kranz at 7:31 PM
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But TrekMedic251 thinks:
...are downing cookies, licorice, cheese curls, candy bars, french fries, frosted wheat cereal and peanut-butter cups. Sounds like the desk of the lieutenant at the firehouse! ;-) Posted by: TrekMedic251 at May 21, 2007 10:47 PMMay 8, 2007Chuck Schumer: Feel the LovePerry at Eidelblog refers to the Senior Senator from New York as:
What a great post! Seriously, one of his constituents on a blog points out what no newspaper or magazine will dare. The good If Schumer wants to know the fundamental problem with American refineries, he need not look anywhere but a mirror. The New York Times reported two years ago that "Over the last quarter-century, the number of refineries in the United States dropped to 149, less than half the number in 1981." Worse, the United States hasn't seen a new refinery built since 1976. Every time a company would like to build one, they can't get past the hurdles that Congress, and state and local governments too, made to satisfy the tree-huggers. The blame falls mainly on Democrats, but also on "environmentally minded" Republicans who'll court any vote to win elections. Well done.
Posted by John Kranz at 12:29 PM
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But TrekMedic251 thinks:
But Perry Eidelbus thinks:
I can't take credit for that one. 'Twas one of my friends who feels much the same way about Chuck the Schmuck. Posted by: Perry Eidelbus at May 8, 2007 11:15 PMApril 26, 2007Windfall Profits Taxes, Again.It will save us money at the pump. No, really. Ask Bob Casey. In response to the new round of oil profits, Sen. Bob Casey, D-Pa., introduced legislation Thursday that he hopes will curtail rising gas prices. Casey's bill would impose a windfall profits tax and close certain tax loopholes for big oil companies and use the money for research into biofuels and other related projects. Follow the logic here. 1) Oil companies make excessive profits. Be careful not to laugh too hard. In the real world, step three would be. The "real" step three never crossed Bob Casey's mind? Governor Ed Rendell had the guts to lie to us and say he'll prevent the oil companies from passing on the tax... perhaps Casey thinks we won't notice?
Posted by AlexC at 5:41 PM
February 7, 2007Another Liberal Ideathat could lead to famine. Tens of thousands of people have marched through Mexico City in a protest against the rising price of tortillas. You're kidding overhyped subsidized demand for a dubious product raising it's demand? You learn something new everyday.
Posted by AlexC at 12:02 AM
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But johngalt thinks:
And what does Josh say about the reduction in available labor for auto mechanics, welders, electricians, and brain surgeons when all those grown up farm kids head back to Metropolis to grow a crop for which the demand is more genetically altered than the seed corn is? Or the price of other crops that are crowded out by government corn? Or the spike in demand for scarce irrigation water that is already in a semi-natural balance? Or...? Posted by: johngalt at February 7, 2007 2:45 PM
But johngalt thinks:
I'd also like to call attention to a comment by El-Visitador (that languished in the junk comments bin for far too long due to more than one embedded hyperlink): *** CORRECTION *** No corn mandate *** (sixth comment) In addition to the correction of his previous assertion he adds, "Ethanol could be made in the U.S. from a cheaper, more efficient per acre source: sugarcane. But sugarcane is heavily dutied and protected (which is why sugar is 4 times costlier in the U.S. than in most places around the world), whereas corn is subsidized. This is why most ethanol is currently made from corn." Posted by: johngalt at February 7, 2007 3:00 PM
But jk thinks:
Good point -- I don't want to take a great blogger (and valued commenter) out of the 'sphere. I think he might lease some of that permafrost tundra prime farmland to ADM or Cargill, and they could turn it for him. The point is that subsidies interfere with but do not invalidate the market. I don't want to encourage ethanol subsidies, but rising corn prices is a bogus argument, when there are a million good arguments. Mexico, as was noted in the same discussion, has import quotas on US grain and now flirts with price controls. The enemy of my enemy may or may not be my friend, but to argue against ethanol subsidies because of tortillas is the wrong reason.
But mdmhvonpa thinks:
Hmmm ... pound your chevy's into plowshares ... Forget corn, sugar-beet is the wave of the future boy! And yes, the Mrs would castrate me should I even mention the IDEA of moving back to the wilderness where you live in the 'town' if you can see your neighbor's house. Even if it is 10 miles away. Posted by: mdmhvonpa at February 7, 2007 10:01 PM
But El-Visitador thinks:
"subsidies interfere with but do not invalidate the market. I don't want to encourage ethanol subsidies, but rising corn prices is a bogus argument, when there are a million good arguments." Agreed 100% with JK. But I just enjoy pointing out to the do-gooders that their ethanol mandate is sending hungy kids to bed in thirld-world countries. Posted by: El-Visitador at February 8, 2007 11:33 PM
But jk thinks:
Yeah, that is too good to leave on the table, isn't it? Posted by: jk at February 9, 2007 10:54 AMFebruary 3, 2007Fuel EfficiencyHooray! Alternative fuels come to Philly! The Shell gas station at 12th and Vine Streets now offers ethanol and biodiesel fuels. Would I brag about driving 25 miles out of my way to get some biodiesel? Probably not. Think of the CO2 emitted. He's killing polar bears and contributing to No, I wouldn't brag about it unless it's less than used to drive for a biodiesel fix. “I'll drive this car from this gas station on biodiesel to Miami, which is 1,200 miles away, without refueling. I'll average over 60 mph per gallon,” said Waterloo. Saving the environment or feeling better about yourself? You be the judge. Someone get this guy a Pious.
Posted by AlexC at 12:40 PM
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But johngalt thinks:
If you follow the link in my Ethanol Myth post you'll see some related articles (subscription required) that discuss ethanol fuel: Hot topics in the ethanol debate says - "Considering the entire “well to wheel” process, including growing and harvesting the corn, and producing, shipping, and burning the ethanol, David Friedman, the clean vehicles research director at the Union of Concerned Scientists, says that E85 made from corn provides an 8 to 15 percent reduction per mile today. That is countered by Tad Patzek, professor of geoengineering at the University of California at Berkeley. He says the “equivalent CO2 emissions from corn ethanol are 50 percent higher than those from gasoline.” Tests of ethanol vs. gasoline shows NOx emissions from gasoline as 9 ppm vs. 1 ppm from E85, but HC and CO emissions are identical at 1 pmm and 0 ppm, respectively.
But Guy Montag thinks:
Yep, if they were driving the kind of 'hybrid' I drive this would not be a problem at all :) Still debating Holly or Edelbrock hydrogen delivery systems for the six-pack . . . Posted by: Guy Montag at February 4, 2007 2:33 AM
But johngalt thinks:
Edelbrock! That's what feeds the 340 4 bbl. in my convertible '68 Barracuda. Posted by: johngalt at February 4, 2007 6:23 PM
But Guy Montag thinks:
Fuel efficiency is defined by turning fuel into horsepower at the fastest rate possible. Posted by: Guy Montag at February 4, 2007 8:06 PM
But jk thinks:
I had a 6-pack Holly in my younger days. I could never get the linkage adjusted properly. It was a 2-barrel until floored when all six would kick in. Posted by: jk at February 5, 2007 10:30 AM
But Guy Montag thinks:
Was that on a MOPAR or something else? On MOPAR the outboards open from the vacume, not a mechanical linkage. Posted by: Guy Montag at February 7, 2007 4:46 PMJanuary 29, 2007Silver Lining?All the sturm und drang about energy has seemed to have no upside. Like Paul Gigot, I enjoyed Senator Grassley's giddy abandon when ethanol subsidies came up at the SOTU, but I expect government meddling and spending and interference will make things worse, not better. Maybe there is a bright spot (a glowing lump of U-235?) The Wall Street Journal reports a rush to license and build noocyoolur plants. A flood of applications seeking permission to build at least 30 reactors, primarily in the South, is expected to pour into the Nuclear Regulatory Commission beginning late this year. If built, the reactors would boost the nation's electricity supply by more than 30,000 megawatts, or 3%. A megawatt is enough to power at least 500 homes. Of course, they wouldn't have to pony up billions in subsidies if they'd establish reasonable criteria for permitting and licensing. In the end, however, I think nuclear power is our best bet for clean domestic power. Nuke plants powering plug-in hybrids could fill a lot of needs with present or near-term technology.
Posted by John Kranz at 11:09 AM
January 26, 2007Whither PigouI part with the beliefs of Greg Mankiw reluctantly. I respect the good doctor. But his recent pushing of Pigouvian taxes and creation of the Pigou club have left me cold. Today, Charles Krauthammer joins the Pigou Club and is applauded by ThreeSources's own LatteSipper. I sense an unholy alliance building between LS, Mankiw, and Krauthammer -- a triumvirate I'm not prepared to consider. Josh at Everyday Economist has a thoughtful post on the topic today. Like me, he's a Mankiw fan but like me he is unconvinced. Individuals respond to incentives. So, if a tax is placed on a good, individuals will be inclined to change their behavior. Pigouvian taxes work especially well on things like cigarettes and alcohol. The increased taxes cause many to cut down on their unhealthly habits; or even quit. However, there is something quite different between tobacco use and automobile use. With regard to Charles Krauthammer's piece, I hate to interrupt the comity implied by LS's improbable link, but I can't agree with that plank of his piece either. Krauthammer has a three-part path to energy independence: "Tax gas. Drill in the Arctic. Go nuclear." If my friend LatteSipper will sign on for all three of those, I'll compromise on the gas tax. Building nuclear power plants and increasing domestic drilling would be good moves. As far as Krauthammer's Pigouvian leanings, I think he makes a big mistake confusing economics with capitalism: No regulator, no fuel-efficiency standards, no presidential exhortations, no grand experiments with switch grass. Raise the price, and people change their habits. It's the essence of capitalism. I would suggest that capitalism would be allowing the market to decide the balance of energy sources and trusting the pricing model to spur innovation. Sorry, LS, the big group hug is put off 'till another day.
Posted by John Kranz at 7:13 PM
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But johngalt thinks:
Well, I'm certainly glad that ONE of us read Latte's link. That Latte is a sneaky guy! I'm also thrilled to learn the academic source of Washington's belief that it can alter reality by raising taxes: English economist Arthur Cecil Pigou and his "Pigovian tax." I daresay that thinking like his is what brought us the very idea of DAWG. Like class-action lawyers beating the bushes for plaintiffs, proponents of Pigou's "Economics of Welfare" needed a club with which to malleate a mostly free world market into something more to their liking. DAWG is, without a doubt, the closest they've come to date. Posted by: johngalt at January 27, 2007 2:59 PMThe Ethanol MythThat's not just this gas guzzlin' global warming denier talking, those are the words of the respected consumer journal Consumer Reports. A recent Harris Interactive study of vehicle owners found that more than half were interested in purchasing an FFV, mostly for reduced dependency on petroleum and improved fuel economy. CR goes on to explain how: - The fuel economy of their test SUV dropped 27% when running on E85 compared with gasoline. And finally, the real reason for the boom in FFV production: The FFV surge is being motivated by generous fuel-economy credits that auto-makers get for every FFV they build, even if it never runs on E85. This allows them to pump out more gas-guzzling large SUVs and pickups, which is resulting in the consumption of many times more gallons of gasoline than E85 now replaces. But this isn't all. The Wall Street Journal explained Who Is Hurt By Oil's Fall (paid link) in the January 19, 2007 issue. The lede says it all. "Drillers, Ethanol Makers Lead Pack Of Stocks That Could Be Hit Hardest" This is because the cost of producing ethanol fuel is so high relative to gasoline. Not because the oil economy is subsidized, but because it requires only refinement to become a fuel, not an elaborate and energy intensive fermentation and distillation process. Still want more? There's a huge debate raging over this issue with claims such as "it cannot contribute to the formation of deposits" coming mostly from domains such as ilcorn.org, mncorn.org, ncga.com (national corn growers assn), and contradictory claims of "increased intake valve deposits by more than 350%" from the addition of just 10% ethanol to gasoline. (This sounds a lot like the global warming debate, with opposing sides making bold claims. I wonder if either of them could be bending the truth a bit?) I suspect the ethanol messiahs are conveniently ignoring the corrosive effects of moisture that is naturally absorbed by anhydrous ethanol. when AlexC wrote The Dark Side of Ethanol yesterday I wondered, what is the bright side?
Posted by JohnGalt at 1:24 AM
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But lattesipper thinks:
Rare is the day I agree with JohnGalt and Charles Krauthammer (Energy Independence?) Posted by: lattesipper at January 26, 2007 8:43 AM
But Everyday Economist thinks:
Okay, I will be the first to stand up and complain about government subsidies of ethanol. However, this analysis by Consumer Reports purports to dispel the "myth" of ethanol when, in fact, their analysis is flawed. First, it is unfair to compare the current cost of ethanol to the current cost of gasoline because in most areas ethanol is monopolistically priced. Ethanol is only available is certain areas of the country. Further, even in areas of the country where it is available, it is offered at only a few places. Second, if we were to allow Brazilian ethanol to be imported, ethanol would be much cheaper. After all, that which is produced in the United States is done by an infant industry that has yet to develop economies of scale. These lower prices would make ethanol more practical and more affordable. The "myth" associated with ethanol is that we can subsidize the industry to the hilt and thus immediately reduce our oil dependence. Even if the industry becomes successful in the future and is able to produce ethanol at a much lower cost, it is not a short run solution. Subsidizing industries has more to do with "creating" jobs than it does with solving the problem. Subsidation is not the panacea that the government pretends it to be. However, ethanol is not the problem; it is the ignorant subsidation of an American ethanol industry. Posted by: Everyday Economist at January 26, 2007 10:35 AMJanuary 24, 2007The Dark Side of EthanolIt's like something out of the twilight zone. Soaring international demand for corn has caused a spike in prices for Mexico's humble tortilla, hitting the poor and forcing President Felipe Calderon's business-friendly government into an uncomfortable confrontation with powerful monopolies. It's good to know that Big Oil aren't the only ones blamed with collusion. The federal government's antitrust watchdog announced this week it was investigating allegations companies were manipulating corn prices, and making deals to limit the supply of corn to boost prices of tortillas.
Posted by AlexC at 9:26 PM
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But Everyday Economist thinks:
Price manipulation? The increase in the price of corn will cause corn producers to produce more. As supply increases, the price of corn will fall as will the price of the tortilla. We heard this same argument with regards to oil just a few short months ago, yet the price of oil has plummeted. Go figure. Posted by: Everyday Economist at January 25, 2007 12:32 PM
But jk thinks:
Well said, EE. You're dead right in a real market. My concern is the government manipulation through subsidies. The tortilla baker has to compete against a subsidized ethanol plant. No wonder Senator Grassley was weeping tears of joy.
But Everyday Economist thinks:
Subsidies are unlikely to push up prices. In fact, a government subsidy often encourages overproduction and thus lowers the price. This is why foreign farmers find it so hard to compete with countries with large farm subsidies. Unless the United States were to develop some type of New Deal-style subisidy that was designed to limit the supply, it is unlikely that we will see a sustained rise in corn prices. The idea behind the ethanol subsidies is to encourage more production. Currently, both tortilla-lovers and ethanol producers are competing for the same scarce resource. The subsidies will eventually lead to increased production and thus lower prices. Posted by: Everyday Economist at January 25, 2007 3:21 PM
But johngalt thinks:
I'm afraid our friend Everyday Economist is vastly oversimplifying the situation by failing to account for the myriad ripple effects of government manipulation of the marketplace. He's also mistaken about just exactly what the subsidies JK mentions are for. It is not corn production that is being subsidized, but ethanol production. That, combined with the "maize only" mandate that El-Visitador claims (the validity of which I have no reason to doubt), creates an artificial spike in demand, which has a predictable effect on price. Meanwhile, ethanol as a practical fuel is a disaster. Posted by: johngalt at January 26, 2007 1:17 AM
But El-Visitador thinks:
*** CORRECTION *** No corn mandate *** I appreciated johngalts' comment regarding my comment, but it made me reflect on what my source was. And my source was my memory, which has been known to fail from time to time. So I looked at a number of sources, including the Act itself, the Energy Policy Act of 2005. Corn is not mandated by law at all. Nonetheless, most ethanol in the U.S. is made from corn, which obviuously results in rising corn prices. And the U.S. does produce (or at least formerly produced) 70% of worldwide corn exports; therefore, any increases in the internal U.S. market have immediate consequences in the (mostly poorer) countries elsewhere that import corn as either human or animal foodstock. Ethanol could be made in the U.S. from a cheaper, more efficient per acre source: sugarcane. But sugarcane is heavily dutied and protected (which is why sugar is 4 times costlier in the U.S. than in most places around the world), whereas corn is subsidized. This is why most ethanol is currently made from corn. some sources:
But jk thinks:
You're both right (I'm a uniter). I'll do a post about this, but Cafe Hayek has more on tortilla-gate. It seems Mexico has a quota to limit imported corn: So because of a bad law in the United States (the requirement to put ethanol in gasoline), the Mexicans have decided to pass a bad law that can only lead to a tortilla shortage.Posted by: jk at January 26, 2007 10:16 AM January 23, 2007Gas Prices DroppingDo you hear that? It's the sounds of 10,000 conspiracy theorists silenced. Today’s Patriot-News survey of 10 stations in the region put the average price for a gallon of regular unleaded at $2.164, down 9.3 cents from last week and 16.6 cents since Jan. 9. ... and here I thought gas prices were being manipulated by the President for his electoral benefit. (Well, there was that SOTU address) Actually, as someone in the petroleum business, I should be crying. But strangely, I'm not. It's like a tax-cut for consumers. Yay, capitalism!
Posted by AlexC at 11:43 PM
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But jk thinks:
$1.99 for regular unleaded around these parts. I read yesterday that GM is actually concerned about low gas prices. Now that they are betting the farm on hybrids and smaller vehicles they do not want to see demand drop. Posted by: jk at January 24, 2007 10:25 AM
But mdmhvonpa thinks:
The thing that bothers me the most: Citgo has the lowest price in the area and 3 new stations have been opened near me. Fargin' Hugo. Posted by: mdmhvonpa at January 24, 2007 10:28 AM
But TrekMedic251 thinks:
I just a pre-approved credit card from Citgo. Voided it and sent it back with a note saying "We don't support South American dictators here. Stop soliciting my name and address. Remove both from your mailing lists!" Other than that, give me Sunoco, or give me death! Posted by: TrekMedic251 at January 25, 2007 9:44 PM
But jk thinks:
Catchy! Posted by: jk at January 26, 2007 10:17 AMJanuary 5, 2007100 HoursWell this didn't take very long.
Legislation introduced in the House of Representatives on Friday would make the oil-rich 1.2 million-acre (490,000 hectares) coastal strip of the Arctic National Wildlife Refuge a permanently protected wilderness and end repeated efforts to open the area east of the Prudhoe oil field to energy companies. "The consensus is that there should not be drilling in the refuge, so the logical next step is to pass legislation which turns it into a wilderness," Rep. Edward Markey, a Massachusetts Democrat and chief sponsor of the legislation, said in an interview. He's introduced it before, but with Democrat majorities, it's going to be a lot easier.
Posted by AlexC at 5:54 PM
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But johngalt thinks:
If there's a consensus that there should not be drilling in the - ahem - "refuge" then why must further debate be prohibited? Could it be that Democrats are afraid that, one day, the consensus could be different? How much more proof does one need that Democrats value democracy only when the majority happens to support their priorities? And just what is the difference between a "refuge" and a "wilderness" anyway? Posted by: johngalt at January 6, 2007 12:20 PMDecember 7, 2006Open MarketsI'm really digging the blog, Open Market. A sample post today: Let them use Solar!
The tagline, if I remember it correctly from when I saw the tv spot earlier this week, is “low-cost oil for those in need, brought to you by the good people of Venezuela and Citizens Energy.” Read the rest. Open Market is a blog of the Competitive Enterprise Institute.
Posted by AlexC at 12:29 PM
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But jk thinks:
CEI could not buy the publicity they've received from the Rockefeller-Snowe letter. I trip across something of theirs once a day now. Posted by: jk at December 7, 2006 4:21 PMDecember 4, 2006DAWG Bites DAWGMAWikipedia tells us that Claude Allegre is a "French geochemist and politician" and "member of the French Socialist Party." Google news search tells us... nothing. (Well, nearly nothing. There's a letter to the editor of the BYU paper mentioning what I'm about to mention.) The French (tabloid? newsmagazine?) L'Express.fr printed an editorial by Msr. Allegre stating, in part, "So, the question that arises is whether there is climate warming or not? [...] Greenhouse effect plays no significant role in these processes." (English translation here.) Fox News Channel told me, and the Majority members of the Senate Committee on Environment and Public Works corroborates, that Allegre's skepticism is "newfound" and that "one of the most decorated French geophysicists has converted from a believer in manmade catastrophic global warming to a climate skeptic." The Senators write: Allegre's conversion to a climate skeptic comes at a time when global warming alarmists have insisted that there is a “consensus” about manmade global warming. Proponents of global warming have ratcheted up the level of rhetoric on climate skeptics recently. An environmental magazine in September called for Nuremberg-style trials for global warming skeptics and CBS News “60 Minutes” correspondent Scott Pelley compared skeptics to “Holocaust deniers.” See: http://www.epw.senate.gov/fact.cfm?party=rep&id=264568 & http://www.cbsnews.com/blogs/2006/03/22/publiceye/entry1431768.shtml In addition, former Vice President Al Gore has repeatedly referred to skeptics as "global warming deniers." Allegre concludes: Glaciers’ chronicles or historical archives point to the fact that climate is a capricious phenomena. This fact is confirmed by mathematical meteorological theories. So, let us be cautious. But the exposure of man’s responsibility as regards global warming allows us to sit idly by (the effect of the measures advocated will be felt only in half a century!). On the other hand, the crusade against extreme theories can be led with tangible results! However, as this is not fashionable, we choose to remain passive. In the meanwhile, the ecology of helpless protesting has become a very lucrative business for some people! Which is more incredulous: That a long-time DAWG might actually recant, and, become active for a "not fashionable" cause, or that the only source for this news in America is a bunch of Republicans on a senate subcommittee? Wait - don't answer that.
Posted by JohnGalt at 3:17 PM
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But jk thinks:
Dammit, jg! If you keep supporting this "Obfuscation agenda," the US Senate is going to shut ThreeSources down. "Glaciers’ chronicles or historical archives point to the fact that climate is a capricious phenomena." Writing your own Taranto headline is left as an exercise to the reader. Posted by: jk at December 4, 2006 3:58 PMNovember 29, 2006Oil, That IsIn case you were wondering...
Just 3 percent of the oil and 13 percent of the gas under federal land is accessible under standard lease terms that require only basic protections for the environment and cultural resources, according to the survey, which was ordered last year by Congress. An additional 46 percent of the oil and 60 percent of the gas "may be developed subject to additional restrictions" such as bans to protect animals and sensitive terrain during parts of the year. Another example of government being the primary obstacle to lower gas prices. They're in the way, as usual.
Posted by AlexC at 1:12 AM
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But mdmhvonpa thinks:
Hey, the fact we buy oil abroad which funds terrorists is a good thing. I mean, when was the last time a terrorist tried to blow up a rock that the seven toed blind newt was using as a breeding créche. Now, if we could get Al Kookda to declare a fatwa against the flora and fauna of America as well ... oh, boy. The Nature freaks would ... well, freak. Posted by: mdmhvonpa at November 29, 2006 11:12 AMNovember 20, 2006MonopoliesI came across this great ad from 1976 the other day, I wish I knew the complete context behind the it. It struck me as interesting in two ways. First, it's an ad in National Geographic by an oil company taking an unapologetic look at the state of it's industry. It's actually pretty aggressive in it's own defense.
This "monopoly" is so inept, it offers the world's richest country some of the world's most inexpensive gasoline. This "monopoly" is so inept that it lets everybody and his brother horn in on the action. Did you know that of the thousands of American oil companies, none has larger than 8.5% share of the national gasoline market? In fact, this "monopoly" is so inept, that you probably wouldn't recognize that it is a monopoly, because it looks so much like a competitive marketing system. People who call us a monopoly don't know what they're talking about. Self-defense from a company or industry is always fascinating. The American Petroleum Institute did this a year ago when they compared their profit rates with other industries. Oil came in in the middle of the pack at about 7.5 cents on the dollar. Banking was at 20%. There's also a great defensive cartoon from the 50's. Secondly, thirty years later, some things have changed. ExxonMobil, the largest American oil company now controls something like 15% of American gasoline refining, Roughly double the "largest" block in 1976. By contrast Coke and Pepsi are at 41% and 31% of the soft drink market, respectively. Of course that's comparing apples to oranges. Coke and Pepsi compete globally. There is no OPEC of dyed sugar-water. XOM's market is artificially manipulated. Looking the companies shown, you have ask yourself, how many of these are still around? Most have been merged into other brands. Perhaps only Sunoco, Shell and Tesoro are the only companies still existing in the same sense as 30 years ago. Of the large oil companies listed above, Gulf, Sohio, Texaco, Conoco, Amoco, Getty, Chevron, Union, Arco, Union, Exxon, Mobil, Phillips 66, Hess and Citgo have all been acquired by another or merged with each other in some way... and that's without counting up the minors and regional players. Overall, pretty neat stuff. (graphic from GasSigns.org) Update: An email from a friend of mine who really should be blogging.
As ever, it was a politically motivated extortion threat generated out of the heat for Congress to "do something" after one or more of the '70s oil shocks. The McCain-Feingold act of the time, sorry, I can't remember its name, forbade the companies from donating directly to politicians. Political Action Committees (PAC)s were the result. I suspect the ad that you show - and a zillion others of the time - was financed by one of the oil company PACs. PACs probably still exist but have probably morphed into a "Section 1701" or some similar techno-lawyer rubbish term for the same thing.
Posted by AlexC at 2:25 PM
November 19, 2006Dems to Raise Gas PricesApparently the latest drops in fuel prices have really sent the Dems into a titter. To rectify this problem, it's time (yet again) to stick it to the oil companies.
Hot-button issues such as a tax on the oil industry's windfall profits or sharp increases in automobile fuel economy probably will not gain much ground given the narrow Democratic majorities in the House and Senate. Incoming House Speaker Nancy Pelosi, in an outline of priorities over the first 100 hours of the next Congress in January, promises to begin a move toward greater energy independence "by rolling back the multibillion dollar subsidies for Big Oil." So which subsidies are they going to do in?
-A measure passed two years ago primarily to promote domestic manufacturing. It allows oil companies to take a tax credit if they chose to drill in this country instead of going abroad. That's the top of their list. Say hello to three dollar gas soon, and a screeching halt to the current boom in oil field projects and workers.
Posted by AlexC at 12:23 PM
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But jk thinks:
I'm a big fan of big oil, ac, please don't take my question the wring way, but: "Is it wrong to end subsidies in such a profitable industry?" Precisely for the reasons that I would argue forcefully against windfall profits tax, the subsidies you mention seem anti-market. It seems if you craft some way to get government the hell out of the way, refinery capacity would skyrocket without tax breaks. Ditto for domestic drilling. If gas costs three dollars without government subsidies, that's what it costs. Now a coffee subsidy...
But AlexC thinks:
I don't think it should be anyone but the shareholders business what the profits of a company are, and "are they enough?" I think the fact that a "subsidy" like this exists is a symptom of the fact that some government inspired imbalance in the free-market exists. Rather than asking "Should be cancel tax breaks?" the question should be, "What has government done that we need to do tax breaks?" In that sense, we agree. But it's government "solving" a problem of it's own creation. In the end, we don't know what gas costs. It's being meddled with innumerable ways. Posted by: AlexC at November 20, 2006 2:22 PM
But johngalt thinks:
I absolutely agree with AlexC, although it took his reply to jk's comment before I realized we'd both been snookered by NoCal Nancy's misleading terminology. When is a subsidy not a subsidy? When the money at issue was looted from the beneficiary in the first place! Nancy nearly persuaded us of her delusion that those "multibillions" belong to "the people." JK even referenced this in his comment: "...if you craft some way to get government the hell out of the way, refinery capacity would skyrocket without tax breaks, [i.e. getting government the hell out of the way.] By the time you include regulatory limitations, some of which are defensible but most are not, the burden upon "big oil" is disproportionate in the same way as the burden on individuals - those with a "greater ability to pay" are compelled to do so. Posted by: johngalt at November 20, 2006 5:40 PMOctober 29, 2006The Power of Cane
Brazil did achieve independence from foreign oil all right. It happened this past April. But Clinton, true to form, doesn't quite recall the critical point showing how it was done. Here's a clue for the semi-retired former president and policy wonk: Brazilian President Luiz Inacio "Lula" da Silva didn't celebrate the oil independence milestone out in an Amazon sugar field. No, he smashed a champagne bottle on the spaceship-like deck of Brazil's vast P-50 oil rig in the Albacora Leste field in the deep blue Atlantic. Why? Brazil's oil independence had virtually nothing to do with its ethanol development. It came from drilling oil. Brazil's independence has been touted by politicians all over the American left. The numbers were never practical for the United States. There's simply not enough room to grow all of the necessary ethanol. Turns out there isn't enough in Brazil either. I wish I knew who to tip the hat to. Damn.
Posted by AlexC at 10:41 PM
October 24, 2006Windfall Losses Rebate?When oil prices were rising, oil executives were called in front of preening Senators to explain why -- dammit why -- they were making so much money. These "windfall profits" were deemed to be worthy of special taxation. After all, why should the oil companies get to keep the money they made? I wonder if Debbie Stabenow will have a hearing to discuss tax rebates for big oil. It seems their profitability is hurt by falling prices as it is helped when they rise.
Commodity boom huh? Sure glad I didn't jump in on that. (Kidding, kidding.)
Posted by John Kranz at 10:20 AM
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But AlexC thinks:
I think we're perilously close to time for a Chrysler style corporate rescue. Posted by: AlexC at October 24, 2006 11:49 AMGoogle ShmoogleSince JK's "gratuitous swipe" last Thursday, GOOG's share price has soared another 54 points, an increase of more than 12 percent in just two trading days. Which means it is finally almost 10 points above its all-time high of $471.66 on 11 January, 2006. I'm sure this comes as a relief to the many casual traders who bought in January since the share price has been largely under water since then prior to last week. Google's year-to-date appreciation is indeed about 16%, but stodgy old Exxon-Mobil checks in with nearly 25% gain since January 1. And, has dividends to boot!
Add to this that XOM's P/E ratio is 11 while GOOG's is 61 and the same dollar invested in Exxon delivers more than five times the earnings as does that slick tech fad. When I said in January that paying $400 a share for Google would earn you the moniker "moron" it was because Google is the exact same formula that created (and burst) the 1999-2000 tech bubble: Hype and buzz and very little hard assets. If you want to ride that firecracker again then don't let li'l ol' me stop you!
Posted by JohnGalt at 12:54 AM
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But jk thinks:
Well played, friend, well played. I'll agree with your premise of XOM over GOOG, but dispute that the current GOOG run is all hype or comparable to pets.com. Does your cool charting tool do PEG ratios? I contend that Google's high P/E is supported by growth of earnings -- exactly what the bubble stocks did not have. I should point out to anybody choosing sides that jg has a farm to bet and I lost everything on a start-up I was working for. I take my gratuitous swipes from a house of glass. Posted by: jk at October 24, 2006 10:11 AM
But johngalt thinks:
I have to admit to not knowing what a PEG ratio is but I've since learned that it isn't generally a charted value, presumably because it doesn't change very fast. I also learned that a PEG ratio (P/E ratio divided by expected long term growth rate) of more than 1.0 is poor, less than 1.0 is good, and less than 0.5 is excellent. Finance.yahoo.com lists the 5-year expected PEG ratios for GOOG and XOM as 1.58 and 1.53, respectively. These are virtually equal, which tells me that Exxon's earnings growth is not great (to be expected for the leading company in a mature market) and that Google's earnings growth is almost good enough to counteract its huge P/E ratio. One may conclude that investing in Google is as wise as investing in Exxon Mobil, except for that insane share price. And why does Google keep it so high instead of splitting it down to the 25-50 range? I'm just guessing but I suspect the founders restrictions on the selling of shares are tied to number of shares instead of percentage of outstanding shares or dollar value. If shares are worth $500 each then they can cash out bigger faster. More investors buying Google only helps them more. Posted by: johngalt at October 26, 2006 4:12 PM
But jk thinks:
Perhaps they're big Berkshire-Hathaway fans... I brought up the PEG ratio to show that Google's higher multiple is supported by its highert growth rate. October 20, 2006Black GoldMost obvious geological prediction ever.
Eric Cheney said Friday in a news release that changing economics, technological advances and efforts such as recycling and substitution make the world's mineral resources virtually infinite. For instance, oil deposits unreachable 40 years ago can be tapped using improved technology, and oil once too costly to extract from tar sands, organic matter or coal is now worth manufacturing. Though some resources might be costlier now, they still are needed. "The most common question I get is, 'When are we going to run out of oil?' The correct response is, 'Never,'" said Cheney. "It might be a heck of a lot more expensive than it is now, but there will always be some oil available at a price, perhaps $10 to $100 a gallon." Any economist would have told you that. We're not going to leave the oil age for lack of oil. It's going to because something new (and cheaper) showed up.
Posted by AlexC at 8:39 PM
October 9, 2006Up Yours, Chavez
And yet a few of the small communities want to refuse free heating oil from Venezuela, on the patriotic principle that no foreigner has the right to call their president "the devil." The heating oil is being offered by the petroleum company controlled by Venezuelan President Hugo Chavez, President Bush's nemesis. While scores of Alaska's Eskimo and Indian villages say they have no choice but to accept, others would rather suffer. "As a citizen of this country, you can have your own opinion of our president and our country. But I don't want a foreigner coming in here and bashing us," said Justine Gunderson, administrator for the tribal council in the Aleut village of Nelson Lagoon. "Even though we're in economically dire straits, it was the right choice to make."
Posted by AlexC at 10:04 PM
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But mdmhvonpa thinks:
Well, shit. I'm guessing that the DNC is not really all that interested in the Aleut Vote after that. Posted by: mdmhvonpa at October 9, 2006 10:47 PMOctober 5, 2006Dead Sea OilAn Israeli company has found some small amounts of oil in the Dead Sea.
This stuff is everywhere. You just have to have the right market to produce it.
Posted by AlexC at 8:26 PM
September 30, 2006The Sky is Falling!For my record, first time ever, fitfh consecutive blog post I'm going to talk about ... alternative energy. You know, the alternative you can buy at any street corner for less than the cost of Perrier - gasoline. Some of what I'm about to say is based on this article in India's Rediff.com. Much of the rest is pulled straight from a dark place so fact checking by AlexC is encouraged. Gasoline comes from oil. Oil comes from geologic deposits underground. The entire earth has been surveyed and all existing oil reserves have been located, mapped and accounted for on a gigantic spreadsheet at Iranian Oil Company. In fact, A M S Bakhtiari there says "peak oil" (the day when oil production reaches its maximum and begins a steady decline until it is gone in 40-50 years) will occur in 2006-2007. Shell oil experts disagree. They posit that the date will actually be in 2025 or later. So who is right? Probably neither. Energy economist C M Lynch says there is "no visible peak." All of this is reminiscent of the "population explosion" hysteria in the seventies. That fallacious prediction was based on extrapolation of then current birth rates, ignoring the reality that birthrates change over time. Similarly, the "peak oil" and "no more oil" predictions are based on current KNOWN reserves and historical rates of discovering new reserves (like Chevron's recent find in the Gulf of Extralegalalienville). But rates of discovery, like rates of baby making, are not constant over time. Large areas of the US remain untapped because the oil deposits are relatively small. Technology now exists to pinpoint these pockets and they are becoming economically viable to collect. And the prospect of actually running out of oil will cause monumental efforts to locate more and more oil in the coming decades. These and other factors make the fossil fuel "alternative" a very attractive one. Not the least of these factors is that many currently vogue fuels like ethanol and bio-diesel have an EROEI factor (energy returned on energy invested) of less than 1. Like bin Ladin's, the reports of fossil fuel's death have been greatly exagerated.
Posted by JohnGalt at 11:56 PM
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But johngalt thinks:
Hmmm, no commentary by AlexC yet. Either my "dark place" punditry is spot-on or he's commuting to or from the 49th state again. Posted by: johngalt at October 1, 2006 5:19 PM
But Perry Eidelbus thinks:
An Iranian talking about Peak Oil? I'd sooner believe Ted Kennedy talking about how alcohol makes one a better swimmer. Hmm, wonder why Iranians would be talking about this. Could it be because we're finding new deposits all the time, depressing prices and thus rendering Madman Mahmoud's "oil as a weapon" as effective as spitballs? I call the Peak Oil doomsayers, the ones who genuinely believe we're running out as opposed to those trying to create a false panic to drive up market prices, Malthus' philosophical descendants." I look to much earlier than the 1970s, John, for the first instances of "population explosion" Chicken Littles: we're all living proof that Malthus' 1798 prediction of mass starvation was pretty boneheaded. Similarly, the oil doomsayers are being proved wrong as we speak. http://eidelblog.blogspot.com/2005/05/malthus-philosophical-descendants.html Last year I wrote about John Tierney's bet with oil doomsayer Matthew Simmons. The latter thinks we'll have such a scarcity that by 2010 the price per barrel will be over $200 (in 2005 chained dollars). In hindsight, I think they shouldn't have bet an absolute number of dollars ($5000), because what if the price is $199? It would have been better to negotiate some sort of option, where Tierney can make his own prediction of oil's future price. That way the winner's profit would increase with how correct he was. http://eidelblog.blogspot.com/2005/08/call-it-dumb-call-it-clever-ah-but-you.html Let's say Tierney thinks oil will average $60 per barrel for 2010, so they contract that Simmons will buy 100 barrels from Tierney at $130 each (the midpoint). If oil averages $60 per barrel, then Tierney will profit $70 per (less broker fees). If oil averages $200 per barrel, then Simmons will profit $70 (again less broker fees). And the more the winner is correct, the more he'll profit. Anyway, in that entry, I noted Don Luskin pointing out how our *proven* oil reserves are constantly increasing. As you guys noted last month, U.S. reserves are now up by an estimated 50%, 15 billion barrels. That's on top of the Chinese buying PetroKazakhstan (owned by Canada -- will the wonders of globalization never cease?) so they can explore tar sands in Alberta, and OPEC nations developing their own reserves. The latter for years have *already* been pumping (pun intended) profits back into exploration and development. Strictly speaking, I won't say "we" should be going nuclear. There are lots of us who are content with fossil fuels for specific reasons, although I think nuclear reactors are great for household electricity. All I ask is that you don't have to subsidize my choices, that I don't have to subsidize yours, and that you don't force me to trade in my gas-powered car before I'm ready. The new nuclear pellets are very promising indeed, but the Department of Energy subsidized the project, while Congress still has environmental regulations that keep nuclear power too expensive, or entirely restricted in a lot of jurisdictions. Sigh. Indian Point, which is pretty antiquated, and I are on opposite sides of Westchester County. There are two radii for determining evacuation, depending on the severity of any problems. I'm inside the second, I think, but I don't worry about it. The biggest problems are the perpetual ones keeping the damned warning sirens working. The occasional reactor problem is far less dangerous to me than the idiot drivers along I-684 and Route 22. The environmentalist nutjobs are always trying to shut down the reactor. They know they can't, but their lawsuits make IP much more expensive to operate. Thus its electrical output is much more expensive than it should be, in addition to all the environmental restrictions. Some putz years ago tried telling me that nuclear energy is the most expensive kind, and I had to educate him on why. Posted by: Perry Eidelbus at October 1, 2006 9:36 PM
But jk thinks:
I actually think we're all in agreement here (mirabile freakin' dictu!) Sorry for the side road. I certainly don't want to take away anybody's gasoline or subsidize any alternative. I believe that nuclear power is economically feasible without subsidy if we could protect the utilities from excessive regulatory burdens. Posted by: jk at October 2, 2006 10:27 AM
But mdmhvonpa thinks:
Hmmmm, if all the parties agree, does that mean that 3Src has jumped the shark? All here in favor of building Nukes and stop buring oil for electric say Yeah! All against? (crickets...) Ok, next order of business is that confounded wormhole technology allowing us to suck matter from the core of a black-hole and convert it directly into energy. If that damned Enron Front company had not failed, we could have kept it under wraps until our Alien Associates gave us the key-codes to unlock the regulator. When is Karl getting back from Plantet Halliburton? Posted by: mdmhvonpa at October 2, 2006 11:38 AM
But AlexC thinks:
I disagree. Not all of the earth's surface has been surveyed for oil. I'd venture to say that most of the oceans have NOT been completely surveyed. In fact, known oil fields are re-surveyed as seismic technology improves. Not to mention improved methods of production. Let's conserve (it's good to be efficient), and let's explore (it's good to provide what people want). But let's quit with the hysteria. Posted by: AlexC at October 2, 2006 7:32 PM
But johngalt thinks:
Thanks for sharing your thoroughly enjoyable prose on these here pages, MDM. (This is just a glimpse of his greatness, folks. For more see http://www.mdmhvonpa.blogspot.com/) And yes, we are still all in agreement as my assertion "all existing oil reserves have been located, mapped and accounted for..." was said with tongue in cheek. I was counting on the "gigantic spreadsheet at Iranian Oil Company" for the proper context. (Poorly written, I know.) Excellent conclusion AlexC: Quit with the hysteria. (But how else for the environmentalist nutjobs to change what "people want?") Posted by: johngalt at October 3, 2006 11:33 AMSeptember 22, 2006Chavez Offers US Foreign Aid
"We sure could welcome it," she said. "As long as we don't have to pay." In the Kobuk River village of Ambler, heating fuel is running more than $7 a gallon. Residents in the village of 283 and surrounding villages are ecstatic, said tribal administrator Virginia Commack. "It's a miracle," she said. Each household will save more than $700 in fuel costs this winter, freeing cash for people to spend on gasoline so they can hunt more caribou and moose, she said. Ooh. There's a bargain for liberals. They've got to stick it to the caribou so that Chavez can stick it to the President. An unsigned Anchorage Daily
Good thing for those Alaskans that another country is coming to help. BOTTOM LINE: If you're cold and can't afford fuel oil, who cares about the political motives of the giver?
Posted by AlexC at 12:34 AM
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But johngalt thinks:
Doesn't the state of Alaska give each and every state resident an annual oil royalty check in the thousands of dollars? How can ANY Alaskan claim to not afford heating oil? As for Chavez's stunt, even 100 million barrels of free oil given to the proletarians of 18 states is not going to change any votes. How many proletarians vote GOP anyway? It's like paying an eskimo to wear a coat! Posted by: johngalt at September 22, 2006 1:19 AMSeptember 21, 2006Oil$61.92 a barrel, if you haven't noticed.
Posted by AlexC at 11:11 PM
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But johngalt thinks:
Excellent. I'll take three this month. Would you have one of your boy's help me out to the truck with them? Posted by: johngalt at September 22, 2006 12:25 AMSeptember 15, 2006Blaming Bush, AgainMyDD's Chris Bowers looks at George Bush's approval ratings vs the price of gasoline.
That gas prices are dropping around election time is no surprise at all. In fact, I predicted it would happen five weeks ago. When a power-mad administration is this marinated in the oil industry, and when it isn't exactly a state secret (except, apparently, for journalists) that Presidential approval has long been tied to the price of gas, of course the Bush administration was going to do something to lower the prices of gas around election time. I don't think Chris has any idea about the oil supply line and market reaction times. If releasing oil from the Strategic Petroleum Reserve in the spring cuts prices in September, how can Saudi production increases "around election time" have an immediate affect on gas prices? Shouldn't they both be instant? or both delayed? The post begs the question, why "a power-mad administration this marindated in the oil industry" that has enough control over the price of oil, would allow fuel prices to rise? Why not keep us all fat, dumb and filling our Hummers? It's easier for a President to get his way if he's liked. But don't sweat the details. According to Mr Bowers, there's no need for concern about the numbers unless the Republicans can gain another three or four points. He doesn't say what that means, but since we're in conspiracy mode, I think it means that Republicans are in Diebold range. Update: Incidentally, lest you believe that this is a fringe liberal idea... here's a picture of Chris Bowers meeting with former President Bill Clinton the other day.
Posted by AlexC at 2:59 PM
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But jk thinks:
I disagree AlexC. We're not quite in Diebold range yet and I think we'll have to keep African-Americans from voting. Posted by: jk at September 15, 2006 3:20 PMSeptember 11, 2006Energy Users Pay Kyoto CostI love the idea of a "Chinese Wall" between a newspaper's Editorial and News departments. The New York Times could add a few bricks and touch up the mortar of theirs. But I wonder if the Wall Street Journal news staff writers ever go out to lunch with -- or read the work of -- their counterparts on the back of the A Section. Jeffry Ball, in a bylined piece today (paid link) delivers the miraculous news that energy users are paying the costs of Kyoto compliance, while the utilities have played the market disruptions to their advantage. Because CO2 emissions now carry a cost, Germany's largest utility, RWE AG, is spending to improve the efficiency of its aging coal-fired power plants, including its biggest power station here in the country's industrial heartland. I don't think this caught Gigot & Co by surprise. This is a pretty obvious conclusion and a good reason to not follow the articles suggestion that such controls are headed across the Atlantic. Although the U.S., the world's biggest emitter of CO2, has rejected the Kyoto Protocol, many U.S. business leaders say it is only a matter of time before the country imposes some sort of carbon constraint. Earlier this year, Congress discussed how such a nationwide cap might be structured. Last month, California passed a law that will impose the U.S.'s first cap on global-warming emissions. Now the state has to figure out how to put that mandate into practice. I repeat my call. We can debate its existence and causes, but let's agree to not damage the economy while we determine the best course to take.
Posted by John Kranz at 10:38 AM
September 5, 2006Texas TeaBlack gold, that is.
A test well indicates it could be the biggest new domestic oil discovery since Alaska's Prudhoe Bay a generation ago. But the vast oil deposit roughly four miles beneath the ocean floor won't significantly reduce the country's dependence on foreign oil and it won't help lower prices at the pump anytime soon, analysts said. ...
During the test, the Jack 2 well sustained a flow rate of more than 6,000 barrels of oil per day, but analysts and executives believe the payoff could be much larger than that. It's hard to understand how they know they've got a super-mega field based on one well and a few tests... no doubt there is some insider information that we're not privy to, but it's good news for our energy interests. ... but it goes to show that all the easy oil's been had. Except for that enormous patch in Alaska.
Posted by AlexC at 5:19 PM
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But jk thinks:
Josh at The Everyday Economist reminds that this was caused by high oil prices, i.e. the market working: http://everydayecon.wordpress.com/2006/09/06/oil-discovery/ Not to be a wet blanket, but where are we going to refine this? How about refineries in Mexico? Posted by: jk at September 6, 2006 11:40 AM
But silence dogood thinks:
Thank you johngalt! Now, if you don't mind me usurping your point, how about applying it to ethanol, wind, solar, nuclear, etc? That being, why is the argument against all these things that in and of themselves and with current technology that they will not single handedly meet all our energy needs? It seems akin to the Wright Brothers looking at their Flyer, concluding that it will never fly passengers across the Atlantic, and thus deciding that it is not worth it. Posted by: silence dogood at September 8, 2006 3:19 PM
But jk thinks:
May I suggest Federal subsidies as the difference? If Wilb & Orv had cozied up to Senator Thurmond (I think he was there) and got a hunk of US largesse to promote aviation, I think you might have heard complaints. I love alternatives, I just question funding those that don't seem viable. Ten points for including nuclear though, I bet all ThreeSourcers are in. You're a uniter, not a divider.
But silence dogood thinks:
Thanks JK. I too am a nuclear fan. There is waste, yes, but everything is a tradeoff - the manufacture of solar cells and batteries has environmental effects as well. As for funding are you really going to claim that oil exploration is not federally funded? There are some whopper big tax breaks out there which seem to me to be funding by a different name. Posted by: silence dogood at September 9, 2006 9:30 AM
But silence dogood thinks:
Oh yes, maybe Wilb and Orv didn't get get federal funds, but those confounded flying machines were only up in the air for a little over a decade when Uncle Sam noticed their military application. From then on it has been military spending that has given us every major aviation advancement. It's hard to argue that commercial aviation would not have grown on its own, but I don't think we would have gotton from Kitty Hawk to commercial trans-atlantic service in under 40 years without some Federal funding. Posted by: silence dogood at September 9, 2006 9:43 AM
But jk thinks:
Stop me if I'm beating this to death but: I'll join you in cutting subsidies to oil, they're not there to celebrate my beliefs. Yet if I wave my magic wand and remove them, the oil business carries on, barely wobbling in its axis. If I remove Ethanol subsidies the Ethanol industry shrinks to one tenth of its size. It's also hard for me to take military procurement out of the free market and in with subsidies. Buying fighter aircraft that advance technology seems pretty Hayekian to me. August 8, 2006The WSJ Imitates AlexC
I may have to turn in my ThreeSources Optimist badge, but I see this as a net loss for ANWR. This will contravene the assertions that the work will be environmentally friendly and the environmentalists will use it to play up the dangers.
Posted by John Kranz at 6:14 PM
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But AlexC thinks:
I disagree. It's an example of them catching the problem AHEAD of time. It's no secret that things will degrade in a 30 year-old field. They were watching. Posted by: AlexC at August 8, 2006 6:27 PM
But jk thinks:
I hope you and Mr. Gigot are right. Once again, though, I find myself in the position of hoping the voter is paying attention and being rational. While the anti-ANWR folks can just show pictures of oil covered birds from the Valdez spill. Posted by: jk at August 9, 2006 4:41 PM
But johngalt thinks:
It's no secret to anyone who's mechanically inclined that pipelines require maintenance. Voters, on the other hand... But what I wonder is, why didn't it occur to BP? How many times do we hear about pipelines being shut down for repair? Don't most pipeline operators have plans in place to minimize downtime? The fact that this one is operated by BP, the oil company that apologizes for being an oil company, makes me wonder if they have any idea what they're doing up there. Posted by: johngalt at August 10, 2006 12:33 AMPolitical OpportunistsI've come to the conclusion that Democrats simply don't stand for anything outside of bashing big business. Now some are calling for Congressional investigations. Congressman John Dingell, the House Energy and Commerce Committee top Democrat.
Congress is now out for its month-long summer recess, and any hearings on the shutdown would not take place until lawmakers return in early September. These Democrats are the same ones that argue that ANWR's additional oil production will only be a drop in the bucket. Especially when the Energy Information Administrations thinks that there might be anywhere from 600,000 to 1.9 Million bbls per day available from ANWR. Either an additional 1,000,000 bbls is important to our nation, or 400,000 isn't.... and based on the doomsday rhetoric from the media regarding the Prudhoe Bay shutdown, it sounds like it is.
Posted by AlexC at 8:06 AM
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But mdmhvonpa thinks:
I heard that nearly 5 barrels of oil spilled ... where is the Sierra club when you need them! Greenpeace? Hello? Posted by: mdmhvonpa at August 8, 2006 12:43 PM
But AlexC thinks:
No no no.... Despite oil only being measured in barrels, you have to say 5*42 = 210 gallons! Posted by: AlexC at August 8, 2006 6:29 PM
But johngalt thinks:
795 liters! (pardon me, "litres") July 20, 2006Subsiding the Rich(er)Does the PA government really need to be involved in this business?
State Sen. Jake Corman said it's the second round of funding through the Hybrid Electric Vehicle program. The initial rebate program issued $1.5 million in rebates in fewer than 10 months. Let's call it what it is, a handout to the rich. Hybrid owners make on average $100,000 per year. An average family's income? $70,700
Posted by AlexC at 4:25 PM
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But steve f thinks:
well a part of that is wrong. Smug people who brag about own hybrids make over 100k. a prius is no more then a accord, camry, legacy or maxima. average income of these car owners are middle america at 45-70k.
But steve f thinks:
for some dumb reason it wont let me post about e85. E85 is pointless. Here is why. Its subsidized by the state and federal goverment . here is how much 60-80 cents a gallon. What happens if we remove all the subidations? Okay so that makes E85 2.95 a gallon here. Lets remove the goverment kick backs state and federal 70 cents a gallon. so now E85 is $3.65 a gallon. But theres more goverment pork barreling going on here. on raw corn. its very high corn is one of the indursties where you make money throwing the crap out. So if we remove that it would ad about 15 cents a gallon.
Now for those who like in smog state where the MTBE was replaced with 10% ethanol. This is a reason why your gas is abotu 20 cents a gallon above the national average. Since ethanol has less energy then gas whats the impact on your MPG? just about nothing. Here is how you can figure it out. e85 85% ethanol 15% gas. yet it takes 1.2 gallons to get the same energy as gas. So take 1.2 and devide by 85% thats the impact of each percent of ethanol has on the BTU value of gas since the goverment requirs 10% ethanol in 15 states thats 1.4% less MPG then pure gas. Why does the govermetn make us get it? Good question back in the day it would trick the car into running lean so it wont pollute as much. This has been made obsolete with the invention of the o2 sensor. yes its been obsolete since modern electronic fuel injection IE 20-25 years ago.
But jk thinks:
Steve. Thanks for the comments. I am especially interested in O2 sensors’' obsolescing oxygenated fuels. We have a 10% mandate in the Colorado Front Range. If you have a link to any information on that, I'd love to read it. I'll Google a bit. Regardless of the income and pricing, there are two huge flaws with this. One, you are asking people who cannot afford a new car to pitch in $500 for someone who can. And two, you are interfering with market innovation mechanisms. Pennsylvania will be sending $500 checks to hybrid owners long after better technology is available.
But mdmhvonpa thinks:
You know, I should buy a hybrid just to get my state income tax back. Spite, it's what's for dinner! Posted by: mdmhvonpa at July 21, 2006 11:43 AM
But jk thinks:
Good for Yoooooou!!! (with a South Park "thumbs-up") In all seriousness, I don't see it at all wrong to accept a tax break even if you disagree with it. You pay enough taxes with which you don't agree. Posted by: jk at July 21, 2006 11:57 AM
But Silence Dogood thinks:
JK, I'll put in an unsubstantiated thought on oxygenated fuels, according to a CU professor that my buddy used to work with (part of my vast liberal left network), all the testing was done at standard temperature and pressure. This is common for chemical experiements, but it was instituted before the effects could be proven here at 5200 ft. Posted by: Silence Dogood at July 22, 2006 12:45 PMJune 25, 2006The Case Against Ethanol
The second and third alleged benefits are also likely emphemeral. Given that ethanol production requires substantial energy use, any reduction in pollution or greenhouse gases has to be minor. So who benefits from ethanol subsidies? Corn farmers in the Midwest and the politicans who have caved to their interests. Taxpayers and the economy are the losers. The greater Philadelphia area has recently had a 10% Ethanol blend introduced into the system. What does that mean? Gas is still about $3.05 for the cheap stuff. In neighboring Berks County, but "outside" the area, I paid $2.83. I've always attributed the discrepancy due to the boutique blends, but it's never been so large. Not to mention since the switch, our Mini Cooper has had trouble on it's first start in the morning. So much so that we switched from Premium to Midgrade on recommendation from Mini. I'm also convinced that my highway mileage in the Magnum has dropped from 27-ish to about 24.
Posted by AlexC at 12:25 PM
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But jk thinks:
For a couple of decades, the Colorado Front Range counties have had an "oxygenated blend" of at least 10% Ethanol or MTBE mandated in the winter months. When it was enacted, my mechanic begged me not to put “that stuff” in my 1979 280Z. But driving 100 miles to refuel is a losing proposition. I didn't test mileage or anything but after a lot of fear, I don't remember anyone having troubles. Are we paying more? Hell yeah, but that's government intrusion fer ya. (And I'd've dreamed of 24 mpg in that Z...)
But TrekMedic251 thinks:
"Given that ethanol production requires substantial energy use, any reduction in pollution or greenhouse gases has to be minor." I've always been a believer in market-driven technology. At some point, demand for ethanol will produce: 2 - Higher-yielding corn strains, capable of producing more ethanol per pound 3 - A more efficient method of converting the corn to ethanol. Just a reminder, Brazil, which is swimming in sugar cane, has a mandate to go all-ethnaol by 2011. Posted by: TrekMedic251 at June 25, 2006 10:11 PM
But jk thinks:
Or, in a free market: 4 -- It will be shown to be non viable considering the climate at his latitude and the opportunity costs for arable American farmland. Sadly, #4 will be not be given a chance. The Greens and the Ag lobby have both parties too frightened to concede that. June 12, 2006Cheap OilPlatts (don't you read this everyday?)
But Browne, talking to German magazine Der Spiegel, said he expected prices to remain high in the short term. Asked whether he though it possible that prices, currently trading above $70/barrel, were likely to return to levels below $40/barrel, Browne said: "Absolutely. Prices can hardly be expected to drop sharply in the short term, but it is highly likely that in the medium term prices will be at an average of around $40. Very long-term, even a price of $25-30 is conceivable." He did not define short, medium and long term. Cheap energy drives our economy. But it's also a testament to the strength of our economy that it's doing so well with high oil prices. It would be out of control with $25/bbl oil! Tip to Cato@Liberty who writes...
True story. The oil patch workers I work with are not concerned with "peak oil." At least not "global peak oil." Sure, each field has a peak oil event. But the real key is dollar / barrel lifting costs. At some level, depending on the field, it's no longer economical to produce. Operations & Maintenance costs eventually become too high. But peak oil? It's not an issue. Because globally, we'll never reach it.
Posted by AlexC at 10:43 PM
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But johngalt thinks:
Which do you think will appear in the Smithsonian transportation museum first: Hummer or Prius? Posted by: johngalt at June 13, 2006 2:35 PM
But AlexC thinks:
It depends. How heavily armed is the Hummer? 50 caliber roof mounted lead throwers? Posted by: AlexC at June 13, 2006 3:08 PM
But silence dogood thinks:
Yes, but what you are (correctly) saying is that it is more about production capacity and production and refining costs than about finding resources. As to the power and knowledge of Exxon and BP executives, their companies are really small potatoes compared to the big boys, the governments of Russia, Saudi Arabia, Iran, Iraq, and Venezuela. Which of these is so stable that their investing in oil production infrastructure for the long term is a good bet? Posted by: silence dogood at June 13, 2006 3:09 PM
But johngalt thinks:
Actually, I think Iraq is probably the most stable of those you cited. But Silence is right. American oil companies really should get off their asses and start producing from the known resources in and around our own country. What the heck are they thinking? (Sorry, I've been in an unusually beligerent mood ever since the MSM failed to find a cloud around the silver lining of al Zarqawi's al destruction.) Posted by: johngalt at June 14, 2006 1:45 AMJune 7, 2006"Defending Yourself"--CommentThanks AlexC!! I enjoyed that!! I recommend the "Destination Earth" video, too; here is what I say: Once upon a time, people had a much cleaner epistemology -- for the non-philosophers, that means they could understand the world sharper and more clearly, because they followed better rules of logic and reasoning than most people now-a-day. (Well...should I say, simply, they followed rules at all!!) Reviewer: jr0dy - - December 26, 2005 I highly recommend the cartoon. It gets a lot right, and is a joy to watch. You will be hard-pressed to find anything like it today. Since you are rational and self-sovereign by nature, it is right and proper that you should be free in a social context -- i.e., that you should not be subject to coercion by other people. But that means only coercion they initiate; they are free to defend themselves against any coercive action you might make against them. It is proper that each person take whatever action he sees fit to take, as long as he does not initiate force against another. One idea in "What We Have" which is wrong, is the idea that 'there are the same brains and brawn' in a dictatorship as in a free society. (The same ideas is seen implicitly in "Destination Earth.") They are totally off the track here -- downright derailed. Minds do not function under coercion. The society on Mars in "Destination Earth" could not invent and maintain the technology it did independently. Like any other dictatorship, it would decay and collapse under its own malignant weight. Minds, trained in the educational system to obey orders, not to see things independently, would stagnate through the years. There are other features of the short film which make me call it lame, but We the Living will clear up enough...
Posted by Cyrano at 9:56 PM
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But johngalt thinks:
Excellent stuff, Cyrano. Thanks. Another film in the same vein, although feature length rather than a short, is the 1944 adaptation of Pearl S. Buck's 'Dragon Seed.' If you can get past the idea of Katherine Hepburn as a Chinese woman the movie is quite excellent. (It's also notable as a part of the filmography of actress Agnes Moorehead. Anyone? Anyone? Buehler? ... She played Samantha's mother Endora on TV's 'Bewitched.') Posted by: johngalt at June 9, 2006 3:51 PMDefending YourselfCato @ Liberty wonders why Big Oil doesn't stand up for itself like it used to.
It's actually pretty neat for the 1950's cartoon camp.
Posted by AlexC at 4:12 PM
May 19, 2006Supply & Demand
Lawmakers from Florida and California led the fight to maintain the long-standing drilling moratorium, contending that energy development as close as three miles from shore would jeopardize multibillion-dollar tourism industries. "It's a grievous assault on Florida and other (coastal) states," declared Rep. Adam Putnam, R-Fla., of attempts to end the drilling prohibitions that Congress first imposed in 1981 and has reaffirmed every year since. The moratorium bars oil and gas development in virtually all coastal waters outside the western Gulf of Mexico, where most of the country's offshore oil and gas wells are concentrated. Is Congress tone deaf or incredibly stupid? Last time I checked high oil prices were a collossal problem in this country. Yet, we're intentionally keeping oil sources closed? While Cuba and China are drilling in nearly the same places? Good thinking.
Posted by AlexC at 10:28 AM
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But mdmhvonpa thinks:
Hmm, and we should not put windmills off of Nantucket either ... because of the tourists. Soon enough, when the tourists cannot afford to travel to Florida and California, we will hear the California Whine of how we should have drilled on the North Slope, eh? Posted by: mdmhvonpa at May 19, 2006 1:34 PM
But johngalt thinks:
This really is outrageous. Impeach congress! It also serves as evidence that there is NOT an oil crisis. If there were then you can bet this vote would have fallen the other way. Posted by: johngalt at May 20, 2006 11:14 AM
But jk thinks:
Millions of Americans believe that prices are high because of "gouging." Not even the Republicans will dissuade them from this nonsense. Somebody needs to tell people about supply and demand. I don't know who that's gonna be. Posted by: jk at May 20, 2006 11:29 AMMay 3, 2006Living for All Of UsSometimes you have to wonder how, after all these years, and the rock and roll lifestyle, Keith Richards is still alive.
According to New Zealand's Sunday Star-Times, Richards fell out of a coconut tree and suffered a serious headache. The paper reports he felt well enough to get on a jet ski, but then got into an accident. For the record, this cements my "Rolling Stones are better than the Beatles" flamebait. Ringo would never climb a coconut tree... nevermind falling out and getting on a jet ski. Neither would those other guys.
Posted by AlexC at 11:52 AM
Gas WarsTwo gas stations get in to an old fashion gas war dropping prices on each other. So what happens?
An hour later, Seeger countered by lowering BP's regular fuel price to $2.89 as well. The gas war had begun. "I was told that every time they change the price, we change the price, so that's what I did. Now they started a war," Matuszky said. By late afternoon, fuel prices at both businesses had plummeted another 50 cents per gallon, which drew dozens of motorists as lines of cars and trucks grew to five deep at most pumps. More drivers waited along Route 30. "They're pretty much giving it away, so I'm filling up," said Anita Copelli, of Latrobe. At one point, prices dropped to $2.36 per gallon. $2.36 is $0.53 cheaper than it is my neck of the woods!
State police asked the owners of both stations to help alleviate the traffic jam, and both agreed. BP raised its price to $2.89 per gallon for regular and Glassmere raised the price to $2.86.
Posted by AlexC at 11:35 AM
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But jk thinks:
Thankgawd the local authorities were there to stop it! Posted by: jk at May 3, 2006 12:28 PMApril 30, 2006Supply & DemandTim Russert had the Energy Secretary on this morning's Meet the Press to discuss high gasoline prices. In today's show, Mr Russert, former demonstrated complete ignorance of supply and demand.
MR. BODMAN: For that reason. MR. RUSSERT: No, think about that. MR. BODMAN: You know? MR. RUSSERT: Play it out. MR. BODMAN: Demand is up. MR. RUSSERT: Correct. MR. BODMAN: Right? MR. RUSSERT: Right. MR. BODMAN: So you’ve got more demand, you’re going to force price up. You’ve got, you’ve got limited supply, and you’re going to have… Expose the Left has more of the transcript and video!
Posted by AlexC at 11:50 PM
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But jk thinks:
Across the dial on the evil FOXNews network, Juan Williams accused the oil companies of price gouging. Bill Kristol said that profits were up 7% on sales that are up 8%. Williams thought that that demonstrated gouging....ooooookay... Posted by: jk at May 1, 2006 10:13 AMApril 29, 2006Gas price "fix?"This gas price hysteria we've been subject to lately is really something else. The price of gas went from $2.50 a gallon, where everything was apparently hunky dory if the lack of attention it received was any indicator, to 3 bucks, which apparently signifies the end of days. For those like Illinois Senator Dick Durbin (for whom every problem is a nail) there is only one possible explanation: Corporate malfeasance. The proof? Exxon Mobil's chairman recently retired and was awarded, gasp, a retirement bonus. Very well then, let's just regulate the cost of gasoline nationwide so that "Big Oil" no longer has the latitude to gouge innocent consumers ever again. How about fixing the price of a gallon of gas at the pre-hysteria price of $2.50 per gallon, allowing increases only for the rate of inflation of the dollar. That ought to fix their wagon, and protect the consumer, right? Not so fast comrade commisar! Check out the chart below that shows historical gasoline prices in constant 2006 dollars. (from www.factsonfuel.org)
If gas prices had been fixed at $2.50 (2006 dollars) in the past then we'd all have been OVERPAYING by more than 50 cents a gallon for the 22 years since 1984. Who's the gouger now mister price control? While it's true that gasoline now costs roughly 50% more than when I was born, and roughly 20% more than when I got my driver's license, it still hasn't reached a record high price. The real cost of gasoline was greater than today's at two times in history: One was at the birth of gasoline as a motor fuel in 1918, and the other was the transition between the Carter presidency (when oil supplies were pinched and inflation soared) and the Reagan era, when supply tightness eased and inflation was brought back to earth. In all likelihood the prices we see today are as transient as those of the early 80's. Is it possible that we'll see record high prices? (Over $3.25/gallon as an annual average.) Yes, but this wouldn't negate my transitory argument. It would merely illustrate the power of the government to add more costs than have been eliminated by efficency improvements made by "greedy capitalists." (Such a development would also be an awesome marketing tie-in with the new 'Atlas Shrugged' movie!)
Posted by JohnGalt at 11:00 AM
April 28, 2006The Energy PlanSo I've been meaning to write a little about the latest plan from the Senate leadership on cutting prices at the pump. But honestly, it's hard for me to get excited about. Included is a $100 rebate on gas per year. At 18.4 cents per gallon in taxes, that's like getting a break on taxes for about 30 fill ups. Plus to get it will be no doubt byzantine. Yawn. Taxing oil producers? Senators should know better than that. Companies don't pay taxes! Sure, they fill out the forms, but where does that money come from? That's right! The consumer! Another call for drilling in ANWR, which is long overdue.
``We wouldn't be in the situation we are in today'' if President Bill Clinton had not vetoed legislation in 1995 to open the Arctic refuge to drilling, said Republican Senator Rick Santorum of Pennsylvania. It's all too easy to blame Democrats for the high price at the gas station. Though Ann Coulter does a pretty bang up job of it.
But it's too much having to watch Democrats wail about the awful calamity to poor working families of having to pay high gas prices. Imposing punitive taxation on gasoline to force people to ride bicycles has been one of the left's main policy goals for years. For decades Democrats have been trying to raise the price of gasoline so that the working class will stop their infernal car-driving and start riding on buses where they belong, while liberals ride in Gulfstream jets. Oh, and the hysterical global warming shrieking must end. Other types of shrieking to curtail would include "exhorbitant profits", "price fixing!" and "BushCo oil buddies". It's nonsensical and ungrounded in reality, and worst of all, it's lazy. Ultimately it's all our fault. It's both a supply and demand problem. There's not enough supply, and there is too much demand. Increasingly supply is at multi-fold. 2) Diversify refining locations. Putting a large percentage of our refining capacity in one spot that's in the crosshairs of storms is silly. One large storm takes it out. Severely curbing supply. Dumb. 3) Diversify the kind of supply. E85 and other blended fuels are a start. Biodiesel, obviously. Even CNG. The trouble is, those alternate fuels are not necessarily price competitive with petroleum. (This is also a chicken-egg problem, as well.) 4) Something like 70% of the world's oil reserves are under the control of state-owned industries. Central planning of business is very effective in collosally screwing things up. Where's the motive for those "companies" to extract or produce as much as possible? Plus there wouldn't be political reasons to jerk production levels around. The oil companies just want to get it out of the ground and down the pipeline. That's a tougher problem to fix, however. ("war for oil" and all that) Decreasing demand again has multiple facets. 2) Use hybrid tech. More MPG means more less need to tank up. 3) Easy to do is inflate your tires, drive the speed limit and use cruise control. 4) Some dollar level exists where driving will decrease because the price is too high. Isn't that what the climate change people (ie liberals & Democrats) want anyway? In the end, we're all swimming in the stream of the energy market and government forces only tend to push prices in one direction. The wrong way.
Posted by AlexC at 3:20 AM
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But jk thinks:
Man, don't get me started on the $100 rebates. Please tell me somebody will have the gumption to kill that idea. I have to add to your conservation side: Telecommuting. I work at home and never buy gas. More folks could do this. Silence is keen on tax breaks to promote it. That's a little too much gub'mint for me, but it solves traffic problems as well. I've been at it about six months and find the autonomy empowering, though not as much as a lemon bundt cake (Buffy joke, sorry!)
But johngalt thinks:
AlexC's demand reduction step 3 is incredibly effective. The difference in fuel consumption between 75 mpg and 80 is surprising. It's comparable to the economy improvement of step 2 "use hybrid tech" plus it costs less and doesn't look gay. But you forgot to include 5) raise federal CAFE standards. Of course that will have the unintended consequence of raising America's health care costs but hey, were talking about conservation here. A few more dead people along the way will barely be noticed. For those of you unwilling to wait for the corporate puppets in congress to "do the right thing" just trade in your Hyundai wachamacallit for a motorized skateboard. It has better fuel economy than a motorcycle and ... still has four wheels!! Posted by: johngalt at April 29, 2006 10:24 AMApril 26, 2006Texas Tea and Central PlanningLet's not forget.
If ChevronTexaco, ExxonMobil, or other private companies actually owned the reserves, the world would be in a much more secure position with regard to oil production. Instead, we are subject to the whims of figures like Chavez, Russia’s Vladimir Putin, and Iran’s Mahmoud Ahmadinejad, and must worry about the doubtful stability of their personalities and regimes. (To be sure, even a private reserve under such a regime would face the constant threat of nationalization or other interference.) In the mid-1990s, the world had more than 10 million barrels per day of spare production capacity. That figure has fallen to between 1 and 2 million barrels, which means that any significant disruption in supplies can cause prices to soar. Really too much to excerpt, just go read the whole thing.
Posted by AlexC at 11:57 PM
A Ton of CoalPopular Mechanics has a cool chart, comparing different fuels' capability to take a car from NY to California. Four-and-a half barrels of crude to make 90.9 gallons of gas, fifty-three bushels of corn + a half bbl of crude for the 176 gallons of ethanol. My favorite was a ton of coal to provide the electricity. A ton of coal?
Posted by John Kranz at 3:52 PM
April 23, 2006Pius and the MarketThere's only one answer to this problem ya know...
One reason is that most hybrids, unlike the Prius, are not distinctive. A Toyota Highlander Hybrid looks like a Toyota Highlander. A Ford Escape Hybrid is a Ford Escape. "So the hybrid becomes another powertrain option," said Anthony Pratt, an analyst with J.D. Power and Associates. That means that consumers are increasingly putting hybrid systems through the same cost/benefit analysis to which they would subject any other high-cost option. With those same looking cars costing $3,500 to $8,000 more, what's the point of buying one? Especially if it takes years to break even on it. But there is another option.
The Saturn Vue Green Line hybrid SUV, coming out this summer, will cost about $2,000 more than a regular Saturn Vue. It's sticker price will be about $23,000, making it the cheapest hybrid SUV you can buy. Really the correct solution to this problem would be for the federal government to subsidize the purchase of a hybrid to the tune of the price difference between a hybrid and a regular version. I mean, when it comes to the environment, there's no problem the government couldn't solve, and no dollar amount too much.
Posted by AlexC at 10:19 AM
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But jk thinks:
I still say that the picture you posted is the reason that sales are slow. Not that South Park punctured sales. But the folks who wanted to be seen in a hybrid have already bought them. South Park helped stop it from going mainstream (from metastasizing in healthy tissue). Posted by: jk at April 23, 2006 5:21 PMMarch 31, 2006Why $5 Gas Is Good for AmericaI came across an article in the Dec '05 issue of WIRED which argues that high oil prices should be welcomed, not feared, and that the market will provide the answers without any help from government subsidies. All of the companion pieces ("As Prices Rise, Technologies Emerge", "$20-$30", "Digital Oil Fields", "$30-$70", "Ethanol", "$70 and up", "Oil Shale") which can be reached from "Plus" section of the initial article are worth the read as well. You guys will love it.
Posted by LatteSipper at 7:26 PM
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But jk thinks:
You may have tapped into the magic that is ThreeSources. There is no shortage of argument among those who vote alike nor paucity of agreement between (among now) those who vote differently. The article makes a great case that price is a valid communication medium and incentive. "The cost of developing entirely new energy supplies is daunting, but the money is available - and we're not talking about the $14.5 billion porkfest served up by Washington's recent energy bill. The global oil industry will rake in three quarters of a trillion dollars this year. And when that kind of money is up for grabs, investors are never far away." What it misses is the lack of free markets in energy. Oil is cartelized by the producing countries, regulated in its refinement and distribution and then taxed heavily to the purchaser. I suspect a truly free oil market would give us dollar gas. The other missing piece is the proclivity of Congress to regulate actual profits. You missed that discussion around here, but the specter (pun intended) of windfall profits tax will dampen progress on these technologies. Five dollar gas may bring more gaseous senate hearings than Hydrogen-spewing superbugs. February 27, 2006If you can't lick 'emInstead of complaining about Kyoto adding 20% to the cost of energy in the EU, I should have been playing the future's market. Iain Murray writes in TCS Today about "The Kyoto Bubble." It is well known that Enron was a keen enthusiast for limits on carbon dioxide emissions under the aegis of a cap and trade scheme, which would enable companies to trade permits for the right to emit carbon dioxide. Enron documents released to the public reveal that executives thought such restrictions would, "do more to promote Enron's business than almost any other regulatory initiative outside of restructuring the energy and natural gas industries in Europe and the United States." We can now see why. In Europe, such a scheme has been introduced, and the energy companies and their advisers are very happy. " UBS itself concluded that there is a significant risk of a windfall profit tax being placed on the industry." Talk about full-circle -- whom would I root for if there were a windfall profits tax on greenhouse gas markets? I get dizzy just thinking about it. I know we have some fundamental disagreements on global warming around here, but perhaps we can all agree that Kyoto is a bad idea? Oddly enough, the free-marketer in me loves the idea of cap and trade. But I would like to use it for real pollutants, not what plants breathe.
Posted by John Kranz at 12:10 PM
February 2, 2006Energy SolutionsY'all will have to excuse JohnGalt and Sugarchuck if their posting and commenting is light this week. I except that both of them are checking out Federal subsidies available if they convert their farms to Switch Grass production.
Posted by John Kranz at 2:59 PM
February 1, 2006Oil PricesThink oil and gasoline prices are high now? Wait till Senator Specter gets through with them.
"We intend to do something about" rising prices to consumers, Chairman Arlen Specter said at a hearing into whether oil industry mergers in recent years have made gasoline more expensive at the pump. Specter said he was shocked by the size of oil company profits, adding, "It just may be time to legislate in this field." He's a Republican, by the way.
Posted by AlexC at 5:48 PM
January 30, 2006Cheap Oil!Joining the Commonwealth of Massachusetts, the People's Republic of Philadelphia will be receiving oil from Venezuela courtesy of Hugo Chavez. Congressman Chaka Fattah (D-Philly) was a part of the negotiations.
The program, which the Congressman brokered with CITGO and Citizens Energy Corp. of Boston as partners, will be available to residents who have exhausted their benefit under the federal Low Income Home Energy Assistance Program for this heating season. The government of Venezuela, which owns CITGO through its national oil company, will make 5 million gallons of heating oil available for 60 percent of the retail price. Up to 200 gallons of oil will be available to each eligible resident. “We have developed an extraordinary partnership involving the public sector, the private sector and the nonprofit sector,” said Congressman Fattah. “It will produce real help in the depths of the winter heating season for tens of thousands of people in Philadelphia and the nearby counties.” The public sector involves the Congressman’s office and the government of Venezuela, which has provided the oil through CITGO, a century-old U.S. petroleum company owned by the Venezuelan state oil company, PDVSA. Actually it's not Philadelphia, but also the surrounding counties. Not that that really changes the deal. Though I'm sure there are homes in Philadelphia that are oil heated, I thought the vast majority were heated with natural gas, courtesy of the city owned Philadelphia Gas Works. And an obligatory link to the left.
...How about when leaders of other Countries start sending places like Philadlphia foreign aid, in the form of oil to heat the homes of poor people? Imagine a President forcing a company to give their product away at a steep discount. A taste of the comments.
How much of Chavez's actions are more a stick in the eye to Bush and Americans vs being humanitarian?
Posted by AlexC at 8:42 PM
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But jk thinks:
I think it is 100% stick in the eye. Where I am differing from some conservative friends is in asking "Why Not?" Oil is a cartelized commodity. If this loser wants to sell some to my friend AlexC at a discount for PR purposes, it means cheaper oil for me and cheaper oil for my Philly friends. The moonbat community is amused but is it truly harmful to the United States? I am still thinking -- I loved it when Rudy told the sheiks to stuff their contingent offer, but a little cheap oil? Drink up! Posted by: jk at January 31, 2006 10:01 AM
But johngalt thinks:
I heard in an unrelated story on a business program that Venezuela's oil is "high sulfur." Where are the ACID RAIN! howls from the left? Besides, when Venezuela sells oil at 40 points off they're probably still making a huge profit given their dirt-cheap production costs. Here's my question: "Why is the government of Venezuela gouging these poor, struggling comrades who are poorer than poor?" What a scoundrel! Posted by: johngalt at January 31, 2006 3:11 PM
But mdmhvonpa thinks:
It's actually very comical if you think about it. His country's infrastructure is falling apart (See Zimby-land and SA over the water) and he is snuggling up with Iran. He is myoptic (Hate America) and this is primarily due to the tutiledge by Castro. When his neighbors get fed up with his sponsorship of insurgents or the Chinese get shorted due to unfavorable contract terminations he will find himself in a very dangerous place. Posted by: mdmhvonpa at January 31, 2006 8:45 PM
But AlexC thinks:
Dealing with socialists and their ideas of "forced equality" whether they are Oriental or Latin American seems like asking for trouble. Even if we're "ripping them off" on the open market. Could be that whole 1930's Ukrainian Famine thing perculating inside of me. Posted by: AlexC at January 31, 2006 10:06 PM
But jk thinks:
Surely you're not proposing that a Pulitzer Prize winning, NYTimes reporter was lying about the Ukraine? Seriously, ac, you make a good point. Any extent that we are propping up and perpetuating his despotism is bad. His oil can be sold anywhere, but if the PR props up socialism and tyranny, it's not worth it. January 20, 2006TAX CUTS FOR THE RICH!Am I beating a dead (hybrid) horse? Perhaps but I am pretty grouchy with the Hybrid phenom. Richard Burr at The Daily Standard, points out the insanity of tax cuts for SO, HYBRIDS have become the environmental equivalent of driving an Escalade or Mustang. Who cares if they deliver on their promises as long as they make a social statement? So, like recycling, you have a liberal shibboleth that cannot compete in the marketplace (until we get $10 gas). But -- darn it -- it just feels so good we're going to adjust tax policy to make it happen. HYBRIDS ARE ALSO failing to pay for themselves in gas savings. A study by the car-buying website Edmunds.com calculates gasoline would have to cost $5.60 a gallon over five years for a Ford Escape hybrid to break even with the costs of driving a non-hybrid vehicle. The break-even number was $9.60 a gallon for a Honda Civic hybrid. Kinda makes me wonder whether it is a good idea to have the government tampering in the free market...
Posted by John Kranz at 1:16 PM
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But jk thinks:
We are many things at ThreeSources but I don't believe us to be hypocrites. I would gladly cut corporate welfare as well as these softer subsidies. I have long envisioned a bipartisan, dollar for dollar slashing of corporate and personal entitlements and tax breaks. Besides which -- who cares where we find oil? It’s not like anybody would let us actually drill anywhere!
But johngalt thinks:
Wow, a chance to beat two horses with one comment! First, tax breaks for oil exploration should not be cut; tax breaks for everything else should be increased. The simplest approach is what used to be known in the GOP as "tax cuts." (A long time ago, in a galaxy far, far away.) Second, why the hell are US markets forced to agonize over whether Iranian oil will soon be off the market when, save a few RINOs in congress, we'd be drilling in ANWR by now? How about some tax incentives for emergency drilling there instead? Posted by: johngalt at January 22, 2006 10:45 PM
But AlexC thinks:
Johngalt is correct. A sure sign that a facet of our economy requires "corporate welfare" in the form of a tax break to operate or to make something economical is a sure sign that that industry or endevour is overtaxed.
But Silence Dogood thinks:
Johngalt's point is valid, if a little perversely stated. It goes along with further thought I had on this topic, how perverse is it that the government levies a large tax on gasoline at the pump, then gives it back to the oil companies in the form of tax breaks for exploration to help offset those costs that would otherwise be rolled into the price at the pump? So yes, let's cut out the middle man. Posted by: Silence Dogood at January 23, 2006 11:10 AM
But jk thinks:
I might be misconstruing your comment, jg, but I oppose increasing "targeted" tax cuts. Much as I love cutting taxes, you have to cut marginal rates; the subsidies and targeted cuts represent state coercion and undue gub'mint influence in the market. I'll also make a brave stand for gas taxes. They are avoidable (thanks M. Bastiat!) and as much as they can be related to actual road construction and maintenance, strike me as the most free market taxes out there (honorable mention to state lotteries for taking money from stupid poor people).
But johngalt thinks:
I think you're misconstruing, JK. We're on the same page. When I say, "tax breaks" should be increased I mean "targeted" only insofar as it applies to reducing the burden on tax PAYERS. ALL of them, equally (which, incidentally, requires a gargantuan amount of regression to level our current state of progressiveness. (A truly unfortunate word, in this instance.)) Posted by: johngalt at January 23, 2006 3:30 PMJanuary 19, 2006Kyoto BadThreeSources readers will be shocked, shocked, to learn that European nations are "all mouth and no trousers (as the brits say)" when it comes to treaties. In this instance, it is Kyoto. President Bush garnered howls from the "International Community," environmentalists, and his domestic political enemies when he admitted that the US was not going to sign (the 0-95 vote in Al Gore's Senate was deemed inconclusive). Yet the WSJ Ed Page reports that the US is doing much better than the signatory countries in reducing the rate of growth of CO2: Let's go to the latest numbers from the European Environment Agency in Copenhagen. Most European countries have seen an increase in greenhouse gas emissions since signing Kyoto with great fanfare in 1997. No fewer than 13 out of the 15 original EU signatories are on track to miss their 2010 emissions targets -- by as much as 33 percentage points, in the case of Spain. US emissions are up 15.8%, far less than the countries that are berating us -- although we've the highest economic growth. And that is the real problem: The nonsense that passes for debate at U.N. gabfests isn't news. But it is newsworthy that Kyoto's arbitrary targets were mainly cant. Countries that reduce those emissions potentially damaging to health or property do so by investing in cleaner technology. That is possible because of policies that promote economic growth and business investment. Unhampered by Kyoto targets, America's economy is more nimble and better able to adapt to changing technology. We knew Kyoto was bad for the global economy. It turns out it's bad for the environment as well. UPDATE: Here are links to the postings in mdmhvonpa's comments: Kyoto, American Style and Northeast US Kyoto Redux. The first has a table on all developed countries.
Posted by John Kranz at 11:26 AM
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But mdmhvonpa thinks:
Yep ... detials here: http://mdmhvonpa.blogspot.com/2005/12/kyoto-american-style.html November 10, 2005Windfall ProfitsInstapundit and Mickey Kaus have been hyping the pro-Growth Democrat movement. I would love to see it, but I still don't believe. The New Republic is the responsible Democratic organ, right? Clay Risen could've posted this in The Nation: But almost across the board, Republicans have refused to back any measure requiring firms to put their money to a more socially valuable use. For that, you have to turn to the Democrats, who in September rolled out a windfall profits tax, which they reintroduced this week amid the growing public fury. Proposed by Senators Byron Dorgan and Chris Dodd, the bill would tax half of all profits made above a $40-barrel baseline. Republicans and their allies immediately attacked the bill, and few observers have any illusion that it could pass. But it is one more powerful piece of evidence that, in the face of big business, Democrats are willing to put forward solutions while Republicans are content to carp and do nothing. Gasp. Cough. Shudder. [..] Decreasing regulation would help with oil production a windfall profits tax will be no more than a regulatory-accounting burden that will force companies to move profits overseas. Where are these pro-growth Democrats going to come from? Who will support them?
Posted by John Kranz at 1:59 PM
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