First of all, we import a lot more than we used to - and guess what - those imports are made with the help of energy. Do we count the oil China uses in its exports to the US? Don't think so, but leaving it out misleads us into believing we use less energy per $/GDP than we really do.
And how are we paying for this?
$this->bbcode_second_pass_quote('', 'T')rade Gap Accelerates
by Charles Mackay, Tuesday April 12 2005
The trade deficit has been accelerating at a parabolic rate over the last six months.
The US trade deficit in international goods and services is now increasing at an annualized rate of more than $200 billion per year. The accelerating trade gap is the primary reason that the US economy has been able to maintain its growth and shrug off higher energy prices. In the past few years, foreigners (mostly foreign central banks (FCBs)) have been willing to finance the expansion of the trade deficit.
PeakOil is You
THE Peak Oil & Economics Thread (merged)
Overview of peak oil & future economics
by Teclo » Wed 08 Jun 2005, 13:24:40
Whenever I think of peak oil I just think of the overall situation
Like, for example, the capitalist economic model which is based on continual expansion which just comes down to material living standards - although in debt ridden nations like the US that expansion is needed to avoid collapse...
If you pretend (and it could have happened) that scientists had invented an energy source that could have powered all nations and brought them to the same living standard - then it would have been via the capitalist model in a form that we would recognise even if it changed over time
Due to lack of foresight, peak oil means this isn't going to happen - and the entire political power structure of the world and point of most people's lives is about to be challenged
I think that peak oil will highlight what was wrong with the capitalist model (greed, power) and help introduce an improved version that doesn't make its sole aim the enrichment of living standards of a minority
The discussion on retirement age just highlights whats wrong... why should we have to work longer and harder as our GDP grows?
If the system is working it would have the opposite effect - why is material living standards the sole point of life?
Why is our free time considered so worthless that sacrificing it in the name of economics is justified?
And about a million other questions
Peak oil (and the environmental damage) will just reveal everything that was wrong with our economic model and basically force us all to re-evaluate the point of our lives
Teclo
Like, for example, the capitalist economic model which is based on continual expansion which just comes down to material living standards - although in debt ridden nations like the US that expansion is needed to avoid collapse...
If you pretend (and it could have happened) that scientists had invented an energy source that could have powered all nations and brought them to the same living standard - then it would have been via the capitalist model in a form that we would recognise even if it changed over time
Due to lack of foresight, peak oil means this isn't going to happen - and the entire political power structure of the world and point of most people's lives is about to be challenged
I think that peak oil will highlight what was wrong with the capitalist model (greed, power) and help introduce an improved version that doesn't make its sole aim the enrichment of living standards of a minority
The discussion on retirement age just highlights whats wrong... why should we have to work longer and harder as our GDP grows?
If the system is working it would have the opposite effect - why is material living standards the sole point of life?
Why is our free time considered so worthless that sacrificing it in the name of economics is justified?
And about a million other questions
Peak oil (and the environmental damage) will just reveal everything that was wrong with our economic model and basically force us all to re-evaluate the point of our lives
Teclo
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by linlithgowoil » Thu 09 Jun 2005, 05:13:53
we are working harder and living standards are falling, even though apparent gdp wealth grows. this says to me that wealth is being transferred from the many to the few, as most people are poorer now than they were a few years back (sicounting house prices which are a false wealth anyway) - because they are up to their eyeballs in debt, living costs have escalated, wages are not going up all that much.
i dont really understand why people value going to work over having free time either. when someone says to me that they wouldn't know what to do with themselves if they didn't have a job, i despair. They are honestly saying they would rather give 40+ hours of their week away simply to avoid having to think of something else to do? Unbelievable.
If i was in power, i'd introduce a mandatory 3 day working week, ban the owning of more than one house, and ban the owning of more than 1 car per household. that would solve a lot of problems overnight, and also redistribute wealth pretty evenly. paradoxically, this would be resisted most by those who are in the middle/lower income groups even though it would actually benefit them the most - and they'd be willingly egged on by the rich who would have the most to lose.
i dont really understand why people value going to work over having free time either. when someone says to me that they wouldn't know what to do with themselves if they didn't have a job, i despair. They are honestly saying they would rather give 40+ hours of their week away simply to avoid having to think of something else to do? Unbelievable.
If i was in power, i'd introduce a mandatory 3 day working week, ban the owning of more than one house, and ban the owning of more than 1 car per household. that would solve a lot of problems overnight, and also redistribute wealth pretty evenly. paradoxically, this would be resisted most by those who are in the middle/lower income groups even though it would actually benefit them the most - and they'd be willingly egged on by the rich who would have the most to lose.
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by Doly » Thu 09 Jun 2005, 05:28:44
$this->bbcode_second_pass_quote('linlithgowoil', '
')i dont really understand why people value going to work over having free time either. when someone says to me that they wouldn't know what to do with themselves if they didn't have a job, i despair. They are honestly saying they would rather give 40+ hours of their week away simply to avoid having to think of something else to do? Unbelievable.
')i dont really understand why people value going to work over having free time either. when someone says to me that they wouldn't know what to do with themselves if they didn't have a job, i despair. They are honestly saying they would rather give 40+ hours of their week away simply to avoid having to think of something else to do? Unbelievable.
With the current system, people have been trained not to have much free time since they are little. Hardly surprising that they don't know what to do with it when they do have free time.
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Re: Overview of peak oil & future economics
by MacG » Thu 09 Jun 2005, 05:46:48
$this->bbcode_second_pass_quote('Teclo', 'I')f the system is working it would have the opposite effect - why is material living standards the sole point of life?
Why is our free time considered so worthless that sacrificing it in the name of economics is justified?
And about a million other questions
Peak oil (and the environmental damage) will just reveal everything that was wrong with our economic model and basically force us all to re-evaluate the point of our lives
Why is our free time considered so worthless that sacrificing it in the name of economics is justified?
And about a million other questions
Peak oil (and the environmental damage) will just reveal everything that was wrong with our economic model and basically force us all to re-evaluate the point of our lives
I suspect that we are full of values, attitudes and memes from the time Before Oil. Before oil most of our ancestors were poor and miserable. Sweden exported a million people to the US in the 1800's. From a population of four million. People died on those sailing ships. The world was built on violent force in those days - the meanest and most cleverly ruthless won over everybody else. Machiavelli's "The Prince" is highly recommended reading for some hints on how the world is running.
I know of only one example of people who have avoided beeing victimized by some ruthless power-freak, and that is the Swiss.
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Economics controlls PO
by spot5050 » Thu 09 Jun 2005, 18:51:39
Follow this logic...
If oil gets too cheap then refineries will be uneconomical and will be shut down, and exploration will not get financial backing. Therefore there's a minimum marketable price for oil below which it cannot go, by definition.
Likewise there's a max price; If oil costs too much then the economy slows down thus reducing the price of oil.
If oil gets too cheap then refineries will be uneconomical and will be shut down, and exploration will not get financial backing. Therefore there's a minimum marketable price for oil below which it cannot go, by definition.
Likewise there's a max price; If oil costs too much then the economy slows down thus reducing the price of oil.
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Heh..
by UIUCstudent01 » Thu 09 Jun 2005, 19:52:24
I'm a believer that certain things just have inherit value. Oil will be treated like gold me thinks in 20 years... Consumable gold that is...
Also, governments, industry, and science kinda need oil. For the most part, I think oil will not be part of everyday economics, but special military excursions to get oil might be in order in the future... (Oh wait..)
Also, governments, industry, and science kinda need oil. For the most part, I think oil will not be part of everyday economics, but special military excursions to get oil might be in order in the future... (Oh wait..)
Last edited by UIUCstudent01 on Thu 09 Jun 2005, 22:05:35, edited 1 time in total.
https://www.videogamevoters.org/ http://www.savetheinternet.com/ http://www.votersforpeace.us/index.jsp
www.911myths.com - To the 9/11-ers, give it some thought.
www.911myths.com - To the 9/11-ers, give it some thought.
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by Cola-Is-Petroleum » Thu 09 Jun 2005, 20:07:26
Oil is a good with a very inelastic demand, because of its immense importance in so many applications. It has a steep demand curve, so if you lower the price, the quantity demanded will rise relatively little. On the other hand, if you raise the price, the demand will drop relatively little.
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by linlithgowoil » Fri 10 Jun 2005, 05:55:21
yep - the thing economists dont really accept is that oil is not like any other commodity. oil is treated in the same way as things made in a factory are treated, and they think that the same laws of supply and demand hold, regardless of the fact that oil is finited and stuff madie in factories is potentially not finite.
so - economists think that if oil gets too pricey, new supplies will come on line, plus people will stop using it and 'something else' that is 'better' will come along and eventually replace it, sending oil demand to zero in time.
the problem economists have is that they have an in built assumption that, year on year, things get 'better' - money grows and the economy grows and goods and services increase in number until infinity. therefore, they automatically assume that there is a better energy resource than oil simply because there has to be to keep things growing.
we MUST use more energy, year on year, forever or the whole game is up.
i really don't understand how economists think that energy is simply another commodity to buy and sell, rather than the actual pre-requisite for all other activity in the economy. with no energy, you have no economy.
so - economists think that if oil gets too pricey, new supplies will come on line, plus people will stop using it and 'something else' that is 'better' will come along and eventually replace it, sending oil demand to zero in time.
the problem economists have is that they have an in built assumption that, year on year, things get 'better' - money grows and the economy grows and goods and services increase in number until infinity. therefore, they automatically assume that there is a better energy resource than oil simply because there has to be to keep things growing.
we MUST use more energy, year on year, forever or the whole game is up.
i really don't understand how economists think that energy is simply another commodity to buy and sell, rather than the actual pre-requisite for all other activity in the economy. with no energy, you have no economy.
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by aahala » Fri 10 Jun 2005, 10:00:53
Economic analysis is NOT based upon every lasting growth
and certainly not on infinity, but rather scarcity.
Economics is completely neutral as to outcomes. Whether more or less
is a good or bad thing, those value judgments are not made by
the field of economics any more than a mathematican thinks large
numbers are better than small.
Economists are usually assigned one of two tasks. What will happen
if present trends continue, or what needs to happen to achieve a
particular result in the future.
Oil is just another commodity. It has its special characterics as do
many other commodities. Oil is different from others because of
the size of financial consequences, that's a difference in magnitude not
a difference in kind.
and certainly not on infinity, but rather scarcity.
Economics is completely neutral as to outcomes. Whether more or less
is a good or bad thing, those value judgments are not made by
the field of economics any more than a mathematican thinks large
numbers are better than small.
Economists are usually assigned one of two tasks. What will happen
if present trends continue, or what needs to happen to achieve a
particular result in the future.
Oil is just another commodity. It has its special characterics as do
many other commodities. Oil is different from others because of
the size of financial consequences, that's a difference in magnitude not
a difference in kind.
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by Leanan » Fri 10 Jun 2005, 10:18:20
$this->bbcode_second_pass_quote('', 'O')il is just another commodity. It has its special characterics as do
many other commodities. Oil is different from others because of
the size of financial consequences, that's a difference in magnitude not
a difference in kind.
many other commodities. Oil is different from others because of
the size of financial consequences, that's a difference in magnitude not
a difference in kind.
I disagree with this. I think oil is fundamentally different. It's the base our economy is built on, with no real substitutions possible.
That, I think, is the difference. The laws of thermodynamics come into play when you are talking about oil, and most economists don't consider that. The economic point of view is that it's price that counts. If something gets too expensive, the high price will encourage the development of some kind of substitute. That works for widgets, and for many commodities, but it won't work for oil.
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