Michael Klare: Why High Gas Prices Are Here To Stay
I refer frequently to the writings of Professor Michael Klare, documentarian at Amherst, as I find him so lucid and so on-target in his analysis of the macro issues on energy that we face here in the 21st Century. Here, in his piece Why High Gas Prices Are Here To Stay, he notes the difference between what the oil propagandists say (“the world is awash in oil”), and the truth: the world still contains plenty of oil, but very little “easy” oil. It’s getting harder to get to, it’s becoming harder to extract and refine, and the risks to the environment are growing with each passing year. And who’s absorbing these costs? Look in the mirror.
Without any further government intervention we will see fossil fuel prices rise as extraction costs increase as the resource experiences depletion. M King Hubbard expressed is so well with his bell shaped curve back in the 1950’s. There are bound to be some painful moments as supply of “green” energy comes on at a pace and price that does not match perfectly the loss of purchasing power for our traditional fuels.
There are huge private market forces that will bring on the new paradigm. The role of government IMO is to step back and get out of the way. We don’t need politicians rewarding their supporters with big Solindra type projects that just delay the ultimate conversion to clean energy alternatives. L
This problem was predicted even before 1970 but was generally ignored. Had we taken appropriate action at that time, we would be much better off now.
We are still building and expanding freeways which encourage more driving and ultimately do not solve the congestion problem. And, the additional driving causes more fuel to be used. It is unclear whether improving car fuel efficiency actually reduces our dependence on oil; it may simply encourage more driving.
Obviously we need better city planning to reduce the need to commute and to make public transportation more efficient.
If I had my way, a significant portion of the tax burden would be shifted from the income tax to a tax on energy derived from fossil fuel. That way the total tax burden would be unchanged, but there would be a stronger incentive to conserve fuel. People would be less inclined to buy homes where they would have to commute for long distances. The fact that the total tax burden would not be increased might make it politically possible.
I remember people saying “I will walk if gas gets to a dollar” We are a free country, in a sense, we are slaves to Media and advertising and chasing some American Dream that is designed by the people selling it. I have my american dream. “Life is what happens to you while you are busy making other plans” John Lennon. This situation is embarrassing, if you seek National Pride. I go to the Malls in So. Cal and see people in lines to buy “Junk” to die for “Junk”…. When Water sells for what it actually costs things will change, same goes for gas. We are subsidized to death.