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TechnoratiDrilling Ourselves Deep in a Hole
At one point in his masterful People's History of the United States, Howard Zinn reflects upon the unspeakable carnage wrought by the Conquistadors in South and Central America, all in the pursuit of gold, and wonders at how those obscene riches sustained imperial greatness... for barely a hundred years. All that bloodletting, enslavement, massacres -- genocide in places -- for a temporary wealth that quickly vanished on the stage of history.
It reminds me of our current oil craze: in one century we have plundered billions of years of stored hydrocarbons, and what do we have to show for it? Fleeting prosperity -- one that is hardly shared by all -- a highly volatile Middle East, and awesome ecological devastation that will require centuries of recovery.
And now, as the age of oil finally signals its inevitable demise, our president and his allies in Washington announce that their grand response is ... to drill for more oil. Congress and the president are of course reacting to public hysteria from rising prices at the pump. But expanding domestic drilling is an inane proposal. Actually, it is reckless and tragic.
Until this week, Washington has largely chosen to ignore the real reason behind the dramatic rise in oil prices. Congress ripped Wall Street speculators for driving up the price of a barrel, but economists have long agreed that the major culprit is increasing demand in China, India and the developing world. Congress now appears to have realized that global demand is the problem; however, this is a problem that cannot be drilled away. Any increase in global oil supply is destined to be quickly outpaced by skyrocketing energy demands.
Domestic drilling can only diminish gas prices if that supply were guaranteed for domestic use alone. This appears to be the underlying assumption of the current congressional push for expanded domestic drilling. And it is laughable. Contracts for drilling in Alaska and off our coasts will likely go to US-based firms, like Exxon or Conoco, which are also transnational corporations, and thus, in no way compelled to restrict retail to the US market. If expanded domestic drilling succeeds in lowering our gas prices -- even marginally -- five years from now, while gas prices abroad remain robust, we all know well where Exxon will shop its Alaskan crude.
This call to expand domestic drilling is again the temptation to delay the inevitable: the transition to renewable energy and sustainable lifestyles. Oil is ecologically condemned, but also economically condemned, for it is a limited resource: its inevitable destiny is to become more expensive -- and then run out. Accordingly, those nations that best prepare themselves for a post-petroleum world will be best positioned economically for the future.
In Belgium recently, where gas flutters around nine dollars a gallon, I was impressed that people hardly complain. Belgians do complain about Americans, however, and our frenzied reaction to fuel prices that are still less than half what they pay. Belgians have long gotten used to high fuel prices. And they have long adjusted to them. Belgian towns, even the newer neighborhoods, are compact and walkable; they are crossed and interconnected by competent public transportation. Sidewalks and bike paths line the roads, which are populated by all manner of tiny cars such as we hardly see in the US. Europeans are already prepared for oil scarcity -- and demise even, as the famed Autobahn in Germany is now lined with solar panels.
There is little sense that the powers that run this country are similarly forward thinking. Five years later, it is now apparent that the war in Iraq was largely spearheaded by this administration to secure an enduring source of oil. I do not have space here to review the ample evidence supporting this. It is enough to cite the shamefully generous long term contracts for western oil companies in Iraq that are now coming to light.
In his latest book, former World Bank director Joseph Stiglitz claims that the war in Iraq will end up costing three trillion dollars. Imagine if that amount had been dedicated to researching and sustaining the transition to renewable energies. A mere trillion dollars would have gone a long way towards remodeling American suburbia for lifestyle and transportation changes such as I witnessed in Belgium. Instead, we have sacrificed unimaginable funds (from future generations, Stiglitz tells us), and tens of thousands of lives (at least) for a resource that is soon to be economically irrelevant!
In this light, this administration's Iraqi venture is shockingly shortsighted. And now, in proposing that we sully pristine Alaskan wilds and our fragile coastal shelves in the name of oil, the White House threatens to keep living its lie. China is undertaking a massive initiative to install solar powered water heaters on urban homes; Brazil provides 40% of its domestic fuel use from homegrown sugarcane ethanol. We, on the other hand, aim to squeeze more oil from a taxed planet, and further entrench ourselves in our sorry addiction. This nation's repeated gambles on oil will likely cost American prosperity -- and superiority -- in the 21st century.
Firmin DeBrabander is Assistant Professor of Philosophy at Maryland Institute College of Art.
16 Comments so far
Show AllConservatives want to use up our oil first, so we will be even more dependent on foreign supplies later, when prices are even higher, right? What is that self interest, at work, strategic national interest?
Nonsense, it's soft minded, ideological duping.
when are we going to learn,the MAIN reason we are in iraq and afghanistan is ....the bush administration wanted to use war as an election day tool...THEY CANNOT GOVERN WITH OUT IT,THAT IS WHY MCCAIN'S CAMPAGIN IS ABOUT RADICAL ISLAMIC EXTREMISM..... GET IT ! THEY WANT TO STAY IN A WAR TYPE SITUATION....THAT IS WHY THEY WILL NOT SET A TIMETABLE FOR WITHDRAWAL
That is 155 Billion Dollars of Profit Last Year for Big Oil.
It is in Switzerland, the Cayman Islands, Geneva....
But it's not in America, except in the form of Mansions, 80 million dollar Gulfstreams, Tracts of Mother Earth, Buildings and other Real Property.
"if Exxon is making huge profits, where is the money?"
LOL! In the pockets of the executives, of course! The shares are not held by individual investors, but by unit trusts, whose executives are in exactly the same game.
"and awesome ecological devastation that will require centuries of recovery."
Centuries? The british geological survey are arguing that We have entered a new geological epoch. Right now sedimentary rocks are being laid down that will exhibit a boundary, the holocene/anthropocene boundary. The stuff that mankind is doing right now will become a permanent part of the earth's geological record.
menos_poblacion July 19th, 2008 6:11 pm:
"Which presidential candidate wants to get us out of Iraq (albeit probably not fast enough), and which candidate wants to keep us there for 100 years? Something to think about in November."
Which candidate wants to get us out in 16 months (except that that target is "not set in stone" and will be "refined" by "conditions on the ground"), and which candidate wants to get us out in 6 months?
kayaker said :"if Exxon is making huge profits, where is the money?"
From Michael Hudson
"David Rockefeller arranged for me to meet one afternoon with Jack Bennett, the treasurer of Standard Oil of New Jersey (the old Esso before it changed its name to Exxon). "The profits are made right here in the Treasurer's office," he explained, "wherever I decide." He showed me the broad leeway a vertically organized global conglomerate enjoyed in being able to assign "transfer prices" do as to report the overall profit at whatever point taxes were lowest on oil's statistically labyrinthine journey from wellhead to gas station.
Taxes were lowest (in fact, non-existent) in Panama and Liberia, where the oil industry's tankers duly registered their flags of convenience. Standard Oil priced its crude oil low to these shipping affiliates, and sold it at a high, nearly retail price to refineries and marketing outlets in the industrial oil-consuming nations."
http://www.michael-hudson.com/ (go to interviews and spilling the beans)
You see, Big Oil loves imported oil, their profits get booked in the tax havens. They could care less about the stock price, they already got the money from the shareholders, and they get the profits that are booked elsewhere in one form or another. Sure, they do not want the stock to go down, since they have stock options, but the trend has been to give bigger salaries and bonuses in cash, so they are not slaves to the shareholders or stock prices. Profitable corporations that do not need to raise money by selling shares or who are selling off are not slaves to their stock price, and so are willing to sacrifice profits of the US entity to evade taxes, while their corporation in the tax haven makes out like a bandit.
The author mentions that a fraction of the cost of the Iraq war could have been much better spent on the transition to renewable energies. I wholehearted agree. Now that Peak Oil is here, fossil-fuel based energy supplies are set to dwindle dramatically in coming years, and without the Iraq war, we would have been much better situated for the transition.
Which presidential candidate wants to get us out of Iraq (albeit probably not fast enough), and which candidate wants to keep us there for 100 years? Something to think about in November.
whatfools: Yes! And you surely know how, namely by waging wars against "anti-Christians" in the Low Countries of Holland and Flanders and against the Turks in the Mediterranean region. Of course these wars had nothing to do with religion or "terrorism" but only with control of resources. Some of the gold actually ended up on the ceiling of one of the large churches of Rome.
The current hang-up with "dependence on foreign oil" completely overlooks the possibility that we may also end up soon with a "dependence on foreign plastics." The Russians, given their huge natural gas reserves, may eventually corner the world market for producing the cheapest plastics to which we will then become addicted.
amused
compassionate conservatism...war on terror...friendly fire...constitutional safeguards...corporate culture...market correction...military justice...political solution...gunboat diplomacy...peaceful atom...united states
The treasure trove of stolen silver that Cortez brought back destroyed Spain.
Clean Coal ... Army Intelligence ...
Easy oil leads to profligate land use making suburbs just too easy . . . and a habit very difficult to shed.
British and European historic modes of land containment were not about oil: indeed, the most iniquitous enclosure laws came too easily to North America: and they are still with us. That history has, by extension, profoundly influence on our habitual dependence on the automobile: land is a public resource, not to be traded as poker chips!
Perhaps this brief essay . . .
http://www.theyorkshirelad.ca/New.Nanaimo.Center/new.nanaimo.center.html
. . . although exemplifying the small west coast town I call home it may shed light the broader dimension.
kayaker said :"if Exxon is making huge profits, where is the money?"
Honestly I don't know and don't especially care. If Exxon can't make money off the current situation, maybe it needs new leadership. Exxon is bigger in GDP than many countries, is multinational, deals in all currencies, and sells something that is a currency itself. Given the rise in the price of oil, why would Exxon even sell it? Why not hang onto it, since its literally worth more than money in the bank? Then you don't have to report any earnings in worthless dollars cuz your earnings and profits are in something much more valuable.
Lately, if it weren't for Exxon and the Air Force buying up all the ad space, I would think the big three television networks would go bankrupt. I'm sure we're all aware by now that Exxon is actually ordinary (if pretty good looking) people working on new car battery technology and clean coal. I'm all warm and fuzzy for them, and it only cost them a few billion dollars.
Then I remember that they are the primary corporate sponsor of the 'research' of the Global Warming Deniers, and I remember that they are the devil, profits or no.
Everyone picks on the oil companies like Exxon. Well here are a few facts to contemplate. The price of Exxon shares is currently $81.54 which is what they cost in May of 2007. That's right, an investor buying XOM in May 2007 has not seen a rise in share price. But, you say, the dividends have been huge! No, the last dividend was about 2% (on a yearly basis), less than you could earn with an FDIC insured certificate of deposit. So...if Exxon is making huge profits, where is the money?
M. King Hubbart must be laughing his ass off in the great hereafter...
my dad the petro-geologist told me in the 50's that oil would become exhorbitantly expensive by the turn of the century or thereabouts. He was an ordinary technophile and assumed that societies would adapt seamlessly. The tar sand people up north have been waiting for $100 a barrel oil for decades and are now ecstatic....only question is, will increasing production costs bring our economy to its knees? The Alberta pipeline to the Gulf is being financed as we speak....we are allowing the entire modern NorthAmerican experiment to become completely subservient to the vagaries of international development and the resultant price fluctuations inherent in capitalistic systems. Most people know how silly this is but we can't seem to stop ourselves!
Is there any rationality left within the social fabric?