by seahorse » Tue 23 Sep 2008, 22:34:06
JD,
There are two essential groups of Poiliers. Those that believe the problem can be managed and dealt with, and those that don't. Breaking it down further, those that believe it can be dealt with fall into two general categories: (1) it can only be dealt with via a gov't driven solution (Hirsh report to the DOE) and (2) those who believe that capital markets will deal with it absent gov't intervention, because as energy prices rise, alternatives become viable, people conserve etc.
I'm one who believes it would take gov't action, in additon to a working free market, to solve the problem. I believe that gov't intervention is necessary simply because of the scope of the problem and bc there is so much gov't intervention in the energy markets already, i.e. drilling permits, building permits, fuel regulations, fuel taxes, subsidies, etc. I generally subscribe to the Hirsh analysis regarding peak liquid fuels. I also like Boone Pickens idea to move to CNG for commerical vehicles, but as he admits, it will take gov't intervention to get things moving.
So, do I think PO will be solved? I have serious doubts for two reasons. All problems are solvable if people recognize the problem and then work to solve it. Unfortunatley, despite all the publicity on PO as of late, we see no recognition of the problem by the gov't and neither of the candidates is recommending any real plan, other than debating off-shore drilling. Both Pickens and Simmons are very critical of the lack of leadership being shown by McCain and Obama, and I share that criticism. In the end, I simply don't see the US gov't ever taking real action to solve the problem. We can't even take action to address our bankrupt entitlement programs, which are far easier to solve than PO, so I have little faith the gov't will ever act in any meaningful way on PO. I hope to be proven wrong.
The other problem with the US solving PO is its ongoing credit crisis and move away from capitalism. The credit crisis is affecting, for example, loans for new coal plants. So, our credit crisis is affecting the financial ability of private industry to initiate new projects at a time when we need them. Further, instead of using what capital we have left to do a "Marshall Energy Plan" we will waste it all bailing out profiteers and, at the same time, destroy our free market capital system that we need to operate as a free system if it is to react and help solve, in conjunction with the gov't, the PO/energy issues confronting the US.
PO is really a US driving problem, since it is the overconsumption by the US that is driving the issue. As you mention, there are countries out there that are much more effective at dealing with energy issues, and you name two of them, but the world needs the US to change in order to solve the issue. As Simmons says, the easiest way to deal with PO is conservation, which the US refuses to even consider right now. There is one caveat to all this and that is it seems with China's growing demand, that even if the US suddenly got responsible, China may become the world's energy problem.
That's how I see things right now. Basically saying that these bailouts and market intervention by the gov't which hurt capitalism, not help it, only make me more pessimistic that the US or the world will ever deal with PO and thus we will walk into the PO problem with too little too late to deal with it. I personally do not believe we have reached PO yet. Most models seem to suggest its another 3 years away, but, that three years will be here before the next president leaves office, so, there's not much time left to deal with the issue and, we will probably be broke when it arrives.
And that's just the ones we know about.
