Is peak oil hysteria?

Posted by | August 22, 2005 | Uncategorized | No Comments

There is definitely a tendency for certain people to despise wealth and consumption itself rather than its effects.

There is no word for this that I know of, schadenfreude is close but not quite right- lets say armenfreude (poorhappy).

The armenfreude are the people that like it when everyone can't drive fast cars and buy fancy goods, not really because it will damage the environment and squander resources, but because they possess that dour puritan streak that runs through Anglo-Saxon culture secretly wanting to pee on people's parades.

This is the kick-off for Steven Levitt's attack on Peter Maas' piece on peak oil – that one should be skeptical of doomsayers – indeed.

But then Levitt's single explanation of why peak oil is not a problem is that everything will be OK because markets are self correcting.

I am no economist, but this looks like horseshit to me, it sounds less like a ‘Fisking’ than a ‘Hitching’, i.e. doing the Christopher Hitchens thing of being deliberately contrarian without really believing what you write.

1. The oil market is one where demand has been shown to be remarkably resilient to price, until the point where it hurts the overall economy.

2. Every US recession has been prefaced by rising oil prices.

3. From the Roman Empire to the Danish in Greenland, the biggest threat to civilization has consistently been problems with resources.

4. The US government has said that it cannot sign the Kyoto Treaty because it would 'wreck the economy' – the effects of the Kyoto Treaty would be the turning down of the dial on the air conditioner and the spendthrift use of the car that Levitt talks about.

5. We are at war because of access to oil, people are dying.

6. There are countless examples of economic systems that don't correct through market forces, anything taken to breaking point won't, such as the Irish potato famine.

My real issue is that there appears to be evidence that two things are potentially a real problem of global importance worth investing in protection against even if the risk is teeny tiny – and it isn't.

These issues are Global Warming and the lack of an imminent solution to Oil Dependancy.

But we don't need to succumb to armenfreude to tackle them, in fact technological progress may be more important now than ever.

We need some air-bags for our fast car economy and its effects, even if, as we hope, they will never be used, they will be worth it.
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