If they want expensive let them try electric cars for a while!
Tanada wrote:http://ourfiniteworld.com/2012/10/25/an-economic-theory-of-limited-oil-supply/
In my view, neither of these views is correct. My view is a third view:
3. An adequate supply of cheap ($20 or $30 barrel) oil is no longer available, because most of the “easy to extract” oil is gone. The cost of extracting oil keeps rising, but the ability of oil-importing economies to pay for this oil does not. There are no good low-cost substitutes for oil, so substitution is very limited and will continue to be very limited. The big oil-importing economies are already finding themselves in poor financial condition, as higher oil prices lead to cutbacks in discretionary spending and layoffs in discretionary industries.
Much more to the excellent article at the link above, I urge everyone to read it and understand the points made in the quote above.
I dont disagree entirely with his conclusion. The $30 dollar oil is gone like $1 milk. There is plenty of "easy to get oil". A lot of it is off limits, on federal lands, but a lot of it isnt. Federal policy has as much impact on supply and price of conventional energy as the markets, just as it does with every product priced in dollars.
High oil prices are not the cause of economic problems. You are better served trying to make the point high oil prices are the straw breaking a poorly managed economies back. Prices on all things are high, most at all time highs. I dont think absurd government spending policies that put an unlimited debt on all of us and devalue our currency is caused by high oil prices. I think its the other way around.
Energy prices are unnecessarily high. A change in political policies would change that. The only policy that makes sense is orderly development of known reserves of conventional energy. That source of energy wealth must be developed and distributed to society.
The authors early graph presentations trying to show that energy is the sole independent variable the rest of the economy depends on is a common mistake with just enough common sense and shards or truth to be accepted however faulty the logic.
There are a lot of inputs into the economy right now that are stressing the system, energy is only 1 of them. Energy, like other inputs, is dependent on other inter-related systems. It they are operating efficiently energy will be reasonably priced and abundant. A more direct cause to our problems, and the cause the author is trying to turn you away from, is political. Look at the underlying political forces that have pushed many of our jobs off shore. Look at the abuses in the banking industry casued by faulty government policies. Look at government overspending leading to our debt crisis. There are some major causes, unrelated to energy, at the heart of our economic problems.
