Of course, we need oil. The nations of the world run on oil, and most of their economies would collapse without access to oil. All these things are true right now and will be for some time to come.
But that does not justify 1) the criminal destruction of habitat, environment and entire communities or 2) the political denial that slows – in fact prevents – any serious investment in the future and a world without cheap oil.
We are approaching the end of cheap oil – it’s harder and harder to find what they call ‘sweet crude’, oil that processes well and efficiently. And as long as sweet crude is there, extraction costs are containable. But today we’re increasingly turning to things like shale and deep water which are far more expensive to extract and process. We’ll be paying a whole lot more for oil in the future – and unless we can locate the political will to acknowledge that and put serious money to work on alternatives, that future looks bleak.
BP isn’t the only company out there regularly committing criminal acts. Victims of Exxon Valdez waited decades for compensation as Exxon’s lawyers endlessly appealed until some of the plaintiffs died.
In 1979, a Pemex blowout off Mexico’s east coast was the third largest oil spill in history. (They were drilling 12,000 feet below the seafloor!) It took ten months to stop the flow.
And today, The New York Times has an update about the horrific crimes of Shell Oil in the Niger Delta, where they’ve been spilling the equivalent of and Exxon Valdez every year for fifty years. Fifty years. Half a friggin century. Shell claims that criminals who siphon oil from their pipelines are responsible for much of the problem. But as the story says, Shell manages to use soldiers to beat women protestors but can’t find forces to guard the pipelines.
The oil spews from rusted and aging pipes, unchecked by what analysts say is ineffectual or collusive regulation, and abetted by deficient maintenance and sabotage. In the face of this black tide is an infrequent protest — soldiers guarding an Exxon Mobil site beat women who were demonstrating last month, according to witnesses — but mostly resentful resignation . . .
Claytus Kanyie, a local official, said of the gulf spill, standing among dead mangroves in the soft oily muck outside Bodo. “Nobody [in the US] is worried about this one [the Mexico spill]. The aquatic life of our people is dying off. There used to be shrimp. There are no longer any shrimp.”
Somewhere, somehow, someday they should pay for this.
You can have wealth concentrated in the hands of a few, or democracy. But you cannot have both.
Whatever Works 
We are approaching the end of cheap oil
And as we do, the price of all things energy will go up. It will go up until such time as alternative energy sources become affordable. At which point, we’ll make the switch.
Be patient; it’ll come.
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You’re right about that. I remember last summer (summer before?) when gas at the pump was approaching $5.00. Miles traveled immediately dropped; and after 30 years of ignoring an entire market, Detroit discovered fuel efficient cars again. Indeed the price made all the difference.
But why wait? The windmills that are going up here are made in China. Huh?
Five years ago, I was buying a nearly new car. It had been over 40 years since I last bought a new car. And guess what – mileage was worse than it was then. Shame on us.
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But why wait?
Because the cost of switching is too high. The price of oil combined with it’s portability and power offsets whatever “safety” value you assign wind or solar.
The windmills that are going up here are made in China. Huh?
It would appear that making windmills in China is cheaper than making windmills in the USA.
It had been over 40 years since I last bought a new car. And guess what – mileage was worse than it was then. Shame on us.
That car is now cheaper, safer and pollutes much MUCH less than the car you bought 40 years ago.
In reverse, economist have shown that by Obama mandating MPG targets, more people will die of traffic accidents every year as cars become lighter and more dangerous.
Lool. If we could just pass a law that said car had to be 100% safe AND run on some fuel that doesn’t pollute, we would. But we live in a world with trade offs. We use fossil fuels for the same reason you get medicines from doctors. Because the benefit you obtain from the medicine is more valuable than the cost to you AND the environment around you.
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Pino, I think you’re actually mistaken about the rationale for using medicines and oil. The benefit we obtain from oil and medicines is indeed more valuable than their cost – as you rightly say, this is why we make the decision to buy/use them. But, the value of these items to us does not take any account of their impact on the environment around us. Until there is a way of capturing and pricing the externality costs of such things, their monetary price will not reflect their total social impact.
The cost of switching from oil can be adjusted very simply with the imposition of a carbon tax that tackles exactly this externality issue. Whack a 50% tax on gasoline (rendering its price consistent with the rest of the OECD), and your timetable for switching (and the issue of total social costs) is pretty well resolved!
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I’m agreeing with Geoff – Pino, you’re making a sterile argument, as though every economic transaction was just between the buyer and the seller. But those ‘externalities’ . . hmmm , if we pay for what we get, how about the Gulf? What’s the prpice on a loss of life, the ruined marriages, broken families, loss of traditions . . . who the hell pays for that?
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‘What’s the prpice on a loss of life’
I actually meant to say loss of a ‘way of life’. I know there is an established price for the loss of a life.
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Until there is a way of capturing and pricing the externality costs of such things, their monetary price will not reflect their total social impact.
I agree with this concept.
A factory in Wyoming that builds a widget to be sold and bought in NYC can pollute the river and the buy will never have to pay the price for that pollution. Further, the residents of Wyoming can not exercise their “economics” by not purchasing the product to counter the pollution.
There IS a role for the government to play by protecting the “Liberty” of the residents of Wyoming. I acknowledge that.
The cost of switching from oil can be adjusted very simply with the imposition of a carbon tax that tackles exactly this externality issue.
This is true. By making oil more expensive, you will speed up the process.
Where I disagree with you,however, is that I don’t think that CO2 is a poison. I have long stipulated that CO2 is a green house gas, that mankind is putting CO2 into the atmosphere and the world is warming as a result. However, I disagree as to the impact of that warming. I think it’s very small compared to the rest of nature’s impact on our climate.
However, for the sake of argument, let’ say that I agree that CO2 IS a poison and we need to move away from fossil fuels.
I am assuming that you are not taxing CO2 to make money, but rather to change behavior –that is, you wouldn’t mind a net revue neutral tax. Given that, just flat out tax oil/gas/coal whatever. Leave this cap and trade nonsense alone. The government is going to pick winners and losers, the credits are going to be handed out to political favorites and it will be a skewed system.
Now, AFTER taxing energy, REDUCE that tax on labor and capital. That is, reduce income taxes, capital gains taxes and payroll taxes dollar for dollar. This way companies pay the same in taxes they have always paid but you are changing their behavior towards investing in business and jobs.
What’s the prpice on a loss of life, the ruined marriages, broken families, loss of traditions . . .
I resonate with the families of the Gulf. For many of them, they personally may never recover. The industry will, however.
I think the economic damage to the nation would be far more debilitating if we “jerked” of oil than by having an oil spill in a specific region.
While the way of life for the individual families may never recover, I think it’s important to remember that the industries will almost CERTAINLY recover. Fish will return, shrimp will return as will tourists. The damage is horrible to be sure, but I think it’ll recover.
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[I think it’s important to remember that the industries will almost CERTAINLY recover. Fish will return, shrimp will return as will tourists.]
I am sure they will too. Eventually. Maybe a generation from now. But not perhaps for the same people. New fisherman will move to the area nad thrive and new restraunters and hoteliers will move to the area nad thrive. But so what? That’s like saying that the hundreds of thousands of deaths in Vietnam was okay, cuz the current gernation doesn’t even remember it.
I’d like to cover a bit more here pino, but occassionally life intervenes and a deadline looms!
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I am sure they will too. Eventually. Maybe a generation from now.
Maybe. Maybe not:
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What a depressing/revealing day… Barton and the whole chaotic backtracking of the GOP. We know they’re working for big oil – but it’s still ugly.
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When he said “I apologize” to BP, I was sure I was finally and truly hallucinating.
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Bachmann, Angle, Paul, Boehner, Barton.. Some run-up for November, huh?
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Don’t forget Wilson – is he running?
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I knew it!! Felt like someone was missing in there…
And check out his website, the chart on “Washington’s Budget Blunders”. All fine – until the Democrats take over!
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I get pretty upset when I read stuff written by people that don’t know a thing about what they’re talking about. The only reason and I mean ONLY reason there is deep water drilling is because the left-wing wacko freaks block any drilling on land of in shallower waters. The oil companies are forced to drill in ultra deep waters, thus greatly increasing the risk for a disaster like we have now. If you want the facts about what BP is doing and has been doing go to their website. The technology is incredible, and when you make such statements like ‘committing criminal acts’ … it’s nothing but left wing blather without any back-up. Villifying these corporations such as BP which happens to employ over 80,000 people is not just misguided it’s just a sh0w of ignorance.
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[The only reason and I mean ONLY reason there is deep water drilling is because the left-wing wacko freaks block any drilling on land of in shallower waters. ]
Sure a few rigs have been blocked here and there and even legislatively. But concern about protecting local industries (fishing, tourism) has been the primary reasaon for resistance.
Anotehr reason of course, is that – in the Gulf at least- we’re running out of space close to shore. I’m posting a NOAA map for you on my about page – take a look at it. Pretty crowded close to shore.
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Running out of space!!! Rrreeaallly? Just because Obama said that? Jeez Moe, I can’t believe you actually believe that. I don’t need the map dear. Have you ever heard of “horizontal” drilling. It’s common practice in the oil and gas industry. Let’s just say it is ‘crowded’ … what about on land? It seems that it would be much easier to contain any problem such as we have right now.
One of the worst safety records? Hmmm… seems like they just got an award for the exact opposite. But I don’t even give a rat’s a$$ about that. Anyone with any sense at all knows what’s happening and where the fault lies, after all the smoke clears. I kinda feel sorry for all the people losing their jobs as the ban on drilling is implementd … but what the heck … it’s just the dastardly oil companies. Seems like I remember the government’s goal … and voila … the door is open:
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[Just because Obama said that?]
Hasty reply here – haven’t even read the rest of your comment. Steve, if Obama said that I HAVE NEVER HEARD IT – not from him or anyone other than my reading at oil blogs.
Just because I SAY IT does NOT mean it’s because I heard Obama say it.
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Great catch but not really very important. I’ve no doubt Maxine Walters wants to take over the oil companies. But fer gods sake, she hardly speaks for the Democrats or even for most liberals
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Nice clip! I’m sure there are many liberals who would love to see Government Oil to go along with Government Motors. If they’re worried about safety and profiteering in the private system, wait until they see what happens under a public system. Nope – no waste or overlooking there!
The buck stopped at the government to ensure the safety of those rigs. Obviously the people hired into those government positions were either corrupted, or corruptible, but let’s instead blame only the corporations for bribing them.
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I’m sure there are many liberals who would love to see Government Oil to go along with Government Motors.
So, Vern. I am indeed a liberal and I work in one of the most liberal environments in the world (a college campus). I know and work with more liberals than you have probably even met in your entire life. Yet, I don’t know anyone who wants to see the government owning the oil industry or the auto industry or any other private industry.
What we do want is to see a stop to the kind of criminal negligence that corporations facilitate in the name of profit. The corporations are demonstrably incapable of doing it themselves – so more government regulation is apparently the only answer.
— hp
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HP,
Well, you have no idea who I know or don’t know, but considering that you’re in academia you’re probably right as to our respective circles.
The word “many” was used in a figurative sense here, not a literal one. It frustrates me as well to see the “right” painted with a similar wide brush.
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What we do want is to see a stop to the kind of criminal negligence that corporations facilitate in the name of profit. The corporations are demonstrably incapable of doing it themselves – so more government regulation is apparently the only answer.
What I WISH you Liberals on college campuses wanted was to stop the kind of criminal negligence that
corporationsUniversities facilitate in the name of profit.Have you checked out the price of your “product” lately?
But serious? Not ONE Socialist among all ya’ll?
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Pino, you don’t have to believe me, but no – I don’t know a single socialist. I know a lot of people who want government to have a far bigger role than you would find comfortable – but none of them want government, for example, to be seizing the means of production and nationalizing industry, which is what socialism is actually about.
As for the cost of tuition, the reasons are complex. Believe me, it isn’t because faculty are getting rich. One major contributor: Students expect more services than they used to. When I was in college, we lived it ratty dorm rooms and ate lousy food. Students don’t accept that anymore – they demand better food and better dorm rooms. Fine, but it doesn’t come for free.
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Pino, you don’t have to believe me, but no – I don’t know a single socialist.
Fair enough.
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I don’t know any either. Although I did meet the long ago mayor of Bridgeport CT sometime in the 50’s. He was a Socialist.
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[Villifying these corporations such as BP which happens to employ over 80,000 people is not just misguided it’s just a sh0w of ignorance.]
Steve – They deserve to be villified. BP has one of the worst safety records in the business. They don’t care, so we have to.
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I don’t care what company it is, that sort of short-sighted ignorance over saving a few dollars always catches up to them in the long run. It is just (VERY) unfortunate that in this case it has to happen with such a loss of life and environmental damage.
Shakedown or no shakedown, the BP executives are 100% responsible for the culture they created that rewards (either extrinsically or intrinsically) that kind of behavior.
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Hey Moe – good to see you – it has been a bit since I last dropped by.
I remember the gas crisis of the 1970s very clearly. In every subsequent oil crisis I have thought “Gee – if we had only invested in alternative energy back then we wouldn’t be in this situation now….”
The problem isn’t merely a lack of forward thinking. Big Oil actively lobbies against the development of alternative energy – for obvious reasons. Pickens is an exception.
Development of alternative energy will obviously have a big up-front cost. So – we might have to pay a bit more for a while. Big dead – in the end we will be better off.
— hippieprof
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And of course it’s not just Big Oil. It seems that on every common sense and practical approach to the business of governing ourselvews and running a country with 300million people in it, we are stymied by someone with a little money and an agenda.
I’m expecially outraged that these corps have no national loyalties, wherever they are. It’s okay for them to be in it for the money – that’s their job. But I get testy when they screw around iwth my rights as a citizen to get thier dollar.
Anyway, nice to see you back Prof!
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Thanks for the education Moe! I had no idea what was going on in Niger. I’m simply dumbfounded by the hold-on-to-the-past-at-all-costs conservatives who do not see the immediate need to transition to green energy. Dumbfounded! Stymied! Perplexed!
What more will it take?
And why, why, why can they not see the obvious financial incentive behind the “science” that is distributed by those opposed to that transition?
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TCL: Can you imagine how dynamic it would be if/when we decide to be the leader in green technology? Invent all the process equipment, manufacture and export the materials, create jobs here building it all.
The extraction industries would go on as before; no jobs should be lost there. We’ll need the oil a nd coal etc for decades to come. But no reason not to build a new industry in the meanwhile.
Do it like NASA. How exciting it could be.
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I’m simply dumbfounded by the hold-on-to-the-past-at-all-costs conservatives who do not see the immediate need to transition to green energy. Dumbfounded! Stymied! Perplexed!
Remember: ” hold-on-to-the-past-at-all-costs conservatives”
What more will it take?
MORE Liberals deciding! That’s what it’ll take….
What? Oh? Really?
This from that bastion of Conservatism:
Lemme ask ya: Do you use oil/gas to power your transportation, HVAC and appliances? Or are YOU willing, cost be damned, to stop using oil/gas?
When phrased THAT way, it makes you sound that your unwilling to pay to get off of oil/gas. What you ARE willing to do is make ME pay for you to get off oil/gas. Or, at the very least, you won’t take the plunge unless I take the plunge with ya.
Jeepers.
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Pino asks: Lemme ask ya: Do you use oil/gas to power your transportation, HVAC and appliances? Or are YOU willing, cost be damned, to stop using oil/gas?
I don’t particularly like the idea of anything costing more money, and I don’t particularly like the idea that I will have to sacrifice some of the comfort to which I have become accustomed. However, I also realize that our current addiction to petroleum is unsustainable and something has to be done to develop alternative sources. You have to take a long view here – things will be painful in the short term, but they will be a lot worse if nothing is done. I am saddened that so many people are unable to do so.
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However, I also realize that our current addiction to petroleum is unsustainable and something has to be done to develop alternative sources.
Lemme know when you take even the first step of tossing out the washer and dryer in exchange for a wringer and clothes line.
I am saddened that so many people are unable to do so.
YOU are unable to do so.
I also realize that our current addiction to petroleum is unsustainable and something has to be done to develop alternative sources.
We have alternative sources, but we can’t use them either.
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[Lemme know when you take even the first step of tossing out the washer and dryer in exchange for a wringer and clothes line.]
Haven’t had a dryer in 15 years. I live in the sunshine state and I just don’t need one.
But it’s not about whether I will do something or make you do something similar.
I said above that we need oil and we will for decades. And I agree with you pino that the best way to get things moving is to put a tax on gas.
But what I want most of all is to see my country do the right thing. Lead the friggin’ way. A future where we start too late will not be a pretty picture.
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Pino,
So it really all comes down to price for you?
It was G.K. Chesterton who said it is the business of conservatives to prevent mistakes from being corrected.
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So it really all comes down to price for you?
Actually, it’s YOU that is price aware. If you think that we should get off oil, the YOU get off oil. Be responsible, do the right thing. Get a job close enough that you can walk, or bike. Turn off the AC or the heat. Plastics? Evil. Many of today’s products–do without.
At least I’m honest enough to admit that yes, everything has a price. A trade-off. What’s disgusting is that you KNOW there is a price but won’t pay it until I do.
And right now, the price of using oil is less than the price of NOT using oil. Can you imagine the damage that would be done to the world’s economy, how the poorest people in the world would be harmed, if we jerked off of oil?
Do you understand the power of oil? It is the most portable and powerful form of energy we have yet discovered and has allowed us to come to where we as a species. Lifespans have been extended because of it. Technology is where it is because of it.
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[ Can you imagine the damage that would be done to the world’s economy, how the poorest people in the world would be harmed, if we jerked off of oil?]
pino, why do you insist on pretending that anyone is saying we have to stop using oil? People DO say we have to get less dependent on oil – that’s the future tense.
And yes, oil has brought us many blessings. So did sail, and steam, and coal, and fire. And the wheel.
Time to begin the journey – however long it takes – to the next energy source.
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pino,
FYI, I do everything I can do be responsible and use less fossil fuels. I’m not dishonest about it. The fact is that the steps that NEED to be taken must be on a national and global level, so that, by default, I can’t really pay more at the pump UNTIL you do too. I guess I can volunteer, but I’m guessing my additional monies would go into the pocket of the cashier.
I do realize the power of oil. I’m aware of how many everyday uses it has.
Plastic? GLad you brought that up.You do realize that oil is finite, and that every gallon we consume on the road is less available for the production of plastic. Have you considered what we are going to do when the sweet crude is gone, or all of it is gone? We have alternate energy sources, plastics, on the other hand is harder to replace.
And as for oil getting us to where we are today… Um. yeah. So did tobacco. Our country was built partly on tobacco. And slavery. And genocide. We don’t continue to utilize something just because it was useful in the past. I used to take children’s vitamins too. I don’t anymore. Especially when I found out the kind I took were bad for my health and for the environment. Did you hear about the giant children’s vitamin spill in the gulf? terrible!
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FYI, I do everything I can do be responsible and use less fossil fuels.
I’m guessing you don’t. Proof being that you are using a computer connected to the internet to run a blog.
The fact is that the steps that NEED to be taken must be on a national and global level, so that, by default, I can’t really pay more at the pump UNTIL you do too.
Individual people, without organization, have forced corporations like Wal-mart, Target, Amazon and the like to drive prices down. If you and those who think like you would express yourselves at the market place, perhaps you too could drive corporate behavior.
You do realize that oil is finite,
We will never burn the last barrel of crude.
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Pino,
No, you’re right, I’m not Henry David Thoreau.
I’m not sure the market has driven wal-mart. In fact, if you research wal-mart, you’ll find that it has driven the market.
But, that being said, many many people in my community are biking these days, and more every year. To some degree you are correct, but I fear it will be too little and too late. Without government regulations on MPG and such, I don’t think corporations are going to act responsibly quickly enough.
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Without government regulations on MPG and such, I don’t think corporations are going to act responsibly quickly enough.
I’m interested…..
Why do you think the loss of life that going to occur as a result of higher MPG is justifiable?
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Why would higher ‘miles per gallon’ result in loss of life? I’m interested too.
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Why would higher ‘miles per gallon’ result in loss of life? I’m interested too.
I am curious too, but my guess is he means that lighter cars are less safe in crashes.
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