by scssvop » Sat 06 Mar 2010, 11:31:27
$this->bbcode_second_pass_quote('GoghGoner', '')$this->bbcode_second_pass_quote('scssvop', '
')The good news is that as the price of oil rises, demand for alternative resources and fuel savings rise.
Well, the response to this comment could easily fill a book but a couple of quick points:
The alternative source so far is ethanol in the United States. One problem with that alternative is the price of corn is now arbitraged to the price oil. Since the United States, not only consumes mainly corn but also is the largest exporter in the world, the rising price of oil greatly increases world hunger and reduces consumption of other goods. (really we are not replacing oil with ethanol but with natural gas since that is the main input).
The second quick point is that Prius drivers actually put more miles on their vehicles than non-hybrid drivers because it is cheaper (see Jevons paradox). Hybrids do not reduce oil consumption.
The third quick point is if everybody starts consuming less goods then Capitalism is no longer viable. Furthermore, in reduced growth scenarios, the national debt is too burdensome and the government defaults.

What I meant here was "The good news is that as the price of oil rises, demand for alternative resources and the DEMAND for fuel savings rise."
This will in turn spur capitalism as entrepreneurs see the benefits ($$$) in alternative resources. I believe this is starting to happen now. It will be a slow process, but we are moving in the right direction.
I agree with your point on ethanol. Ethanol is probably not the right answer. How did they not foresee the negatives in the use of corn for fuel??? I thought it was common sense...
I disagree with your stance on capitalism. Consumption can always decrease, but it will never go to zero. Some industries might fail, but there will always be a need for necessities such as food, shelter, etc. In every economic downturn, there always emerges a giant. Examples: Procter and Gamble, IBM, GE, and during the Oil Crisis of 1973 - Fed-Ex.