McCain Good and Bad

Robert Scheer asks for the real John McCain to please stand up in this eye opening article on Alternet:

"Thanks in part to McCain's vigilance, a defense contracting scandal he exposed resulted in a Pentagon procurement officer and the CFO of Boeing being sentenced to federal prison when it was revealed that the Air Force was leasing unneeded air tankers at an initial cost of $30 billion.

It was not the first time that McCain had risen on the Senate floor to accuse the Pentagon of being in cahoots with defense industry lobbyists, and he does deserve high marks for being one of the few members of Congress willing to hold the military-industrial complex accountable. But we hear little from that McCain these days as he goes on and on praising a pointless war in Iraq that has become the main excuse for wasting trillions in so-called defense dollars.

This last is the deal breaker. It is simply not possible to be a genuine small-government-give-taxpayers-a-break president while planning to pour trillions more down that rathole of failed imperial adventures."

This is my biggest problem with McCain. He knows we're wasting trillions of dollars in Iraq, and how bad that is for our economy, and the future of our country. He's long been critical of wasteful spending, and that's great. But we could stop a thousand "bridges to nowhere" and still be stuck with huge debt from Iraq alone. We're not going to solve our debt crisis unless we leave Iraq, or find a way to take all their oil. What's it gonna be, John?

Post-Oil Society

James Howard Kunstler has two articles on Alternet about oil dependence/peak oil/American society, and they're worth a read. I don't agree with everything, and neither do the worthy commenters, but there is real truth here, the harsh kind of truth we humans don't want to face:

Pricey Gas? That's Reality

Ten Ways to Prepare for a Post-Oil Society

"We have to live differently. We're going to have to re-inhabit and reconstruct our civic places -- especially our small towns -- and we're going to have to use the remaining rural places for growing food locally, wherever possible.
Our big cities will probably contract, while they densify at their centers and along their waterfronts. Our suburbs will enter a shocking state of economic and practical failure.We cannot imagine this scenario because we have invested so much of our collective wealth the past 50 years in the infrastructure for a way of life that simply has no future.
We'd better start paying attention to the signals that reality is sending or we will be living in a very violent, impoverished and demoralized nation. And we have to begin somewhere, which is why I suggest we start by rebuilding the national passenger railroad system. It would have a significant impact on our oil use. It would put a lot of people to work on something meaningful and beneficial to all ranks of American society. The equipment is lying out there rusting in the rain, waiting to be fixed. We don't have to re-invent anything to do it.
The fact that we are not even talking about such solutions shows how unserious we are."

Kinsley gets gas

"Ordinarily, we shouldn't want the government to decide when profits become "excess." But the case of huge profits from the run-up in oil prices is different for two reasons. First, it is unusually clear that these profits have nothing to do with productivity. Diverting them to the U.S. Treasury would have no effect on the incentive to extract more oil from American ground. Second, some or all of these profits are directly related to a situation that is imposing huge sacrifices—financial and otherwise—from others; that is, the Iraq war.

Because of the war, the government is adding hundreds of billions of dollars to the burden of debt that all taxpayers, including other businesses, will have to pay off. Because of the war, American soldiers by the hundreds, and Iraqis by the thousands, are paying the ultimate tax of death by government policy. And because of the war, American oil companies are raking in extra billions of dollars of profits.

The oil companies, like other big corporations, are mostly owned by ordinary citizens, either directly or through mutual and retirement funds. Presumably some of them support the war and others don't. Do any of these shareholders, pro-war or anti-war, want to pocket $45 billion (or whatever number you choose) from a war that is costing others so much?"

Is it right to make huge profits on the backs of our soldiers and tax dollars? I'm all for free markets, but oil is different, and this article points out a few reasons why oil is a commodity unlike any other.

Oily Market

Creeping toward oil as a social good | csmonitor.com: "The list of answers to higher priced energy, viable or not, is endless. What the US really needs first, though, is a consensus on just how much more government intervention is needed in the private business of oil. Yes, Congress passed another energy bill last year. But tell that to someone who just paid more than $3 a gallon.

A creeping federal role in oil has been taking place for decades, primarily for two reasons: One, foreign governments control more than three-quarters of oil reserves through national oil companies. And two, oil prices rise steeply when a crisis hits one of these often-unstable governments, or one of them uses energy as a weapon.

Look at recent months: Oil prices rose when terrorists tried to bomb Saudi Arabia's oil infrastructure. Militants in Nigeria shut down a fifth of that nation's pipelines. Iran threatens an oil export cutoff. Iraq's oil industry struggles with attacks. Venezuela plays politics with oil exports. Russia restricts exports of natural gas. China's government-controlled oil importers, meanwhile, are roaming the earth to lock up new oil supplies, as Japan did before it.

These nonfree market forces can easily kick up prices in a laissez-faire oil economy. Last year, Americans paid 17 percent more for energy than in 2004, making energy the largest driver of inflation. Another oil shock like that in 1973 could cost $8 trillion, or almost two-thirds of GDP. Such a potentiality pushes even free-market conservatives to ask for a larger federal role in oil, simply for national survival."

Someone e-mailed me recently regarding the Exxon boycott, and he described oil as a fungible commodity. That's true, but it's also a finite commodity, it will become evermore valuable as there is less and less available and becomes harder and harder to extract and refine. It's not a good example for free market capitalism, especially given the examples in this interesting article.

Peak Oil here?

WN: Wired News:

"Where you stand on 'peak oil,' as parties to the debate call it, depends on which forces you consider dominant in controlling the oil markets. People who consider economic forces most important believe that prices are high right now mostly because of increased demand from China and other rapidly growing economies. But eventually, high prices should encourage consumers to use less and producers to pump more.

But Deffeyes and many other geologists counter that when it comes to oil, Mother Nature trumps Adam Smith. The way they see it, Saudi Arabia, Russia, Norway and other major producers are already pumping as fast as they can. The only way to increase production capacity is to discover more oil. Yet with a few exceptions, there just isn't much left out there to be discovered.

'The economists all think that if you show up at the cashier's cage with enough currency, God will put more oil in ground,' Deffeyes said.

There will be warning signs before global oil production peaks, the bearers of bad news contend. Prices will rise dramatically and become increasingly volatile. With little or no excess production capacity, minor supply disruptions -- political instability in Venezuela, hurricanes in the Gulf of Mexico or labor unrest in Nigeria, for example -- will send the oil markets into a tizzy. So will periodic admissions by oil companies and petroleum-rich nations that they have been overestimating their reserves."

If peak oil isn't here yet, it's close enough that some of these signs are already happening. I can't help but think that our need for a reliable oil supply was the underlying reason for the invasion of Iraq. It seems like Iraq is a dry well at this point...we need an exit strategy that insures us a source of oil for the tough times ahead. Secure the oil fields for ourselves? We could build our bases in the most oil-rich places in Iraq. I don't know what to do at this juncture, but we need to get something from the investment we've made in this war.

America's Peak Experience

America's Peak Experience:

"'Please sir, just one thin mint.'"

In the fifties, geologist M. King Hubbert coined the term, "peak oil," to describe the tipping point at which petroleum supply reaches its maximum annual output. Total US oil production reached its peak in the seventies. Now, the question is when the world supply will reach its zenith.

Recently a number of academic papers have been published that forecast the peak year for world oil production. Most place this event in a time period between 2005 (Princeton Geologist Ken Deffeyes) and 2014 (Germany's Deutsche Bank). Not surprisingly, the most optimistic projection - 2037 - comes from the Bush Administration's forecasters at the Department of Energy.

When peak oil will occur is more than an academic issue. It represents an important milestone for policy makers because it sets a "drop dead date" for our preparation for a time of oil scarcity. Experts believe that it will take at least 10 years for the economy to make the transition from oil to the various alternatives; the longer we wait to start this, the more extreme the economic turmoil will be. "

All the more reason to leave the Arctic alone...we will need to save that stuff for the future.