Peak oil and "transition towns"

Krugman in a recent article (maybe the same one) also said that if the current high oil price were merely a speculative bubble, there would be evidence of hoarding. There isn't. He also mocked writers at the National Review a few years ago for saying that $50 was surely the peak. I have no way to verify if Krugman is correct, but his point seems plausible.

When the conventional wisdom says "Peak Oil!" the bubble is about to burst.

Too bad, because high prices will mobilize investment in substitutes.

I live in Boulder, CO. I first heard about peak oil about 3 years ago when the Boulder Going Local initiative was formed. I remember thinking then that this idea of peak oil was probably more of the same "chicken little" scare tactics than anything else. The past couple of months prove otherwise but it hasn't amounted to anything much here.

Coincidentally, Colorado's governor just last week told the Senate to look a little deeper into oil shale development before tapping into the oil shale on federal land in the state, which contains 5 times more oil shale than Saudi Arabia.

http://www.bizjournals.com/denver/stories/2008/05/12/daily43.html

Jack: "Krugman in a recent article (maybe the same one) also said that if the current high oil price were merely a speculative bubble, there would be evidence of hoarding."

There is evidence of hoarding in the HUGE permanent positions held by commodity index funds!! The hoarding is going on through the futures markets!!

Yesterday in testimony before a US Senate Subcommittee, Michael Masters of Masters Capital Management said something like the increase in demand from index speculators for petroleum futures over the past five years is almost equal to the increase in demand from China. (I saw the clip on CNBC.)

I wish old school economists would wake up to the implications of the massive changes that have occurred in the financial and real economies over the past decade. I like what Krugman has to say about a lot of things even though I am a conservative. But he is flat-out wrong about this.

Besides, what would you do as an oil producer if the currency you were trading your oil for was losing value and expected to continue to lose value. Would you pump like crazy to meet demand or would you slack off a bit and keep the oil in the ground, especially since it appears that it will be worth more tomorrow than today?

In other words, the hoarding is occurring underground.

Besides, there is more than enough evidence of hoarding in virtually every other commodity. Why would oil be any different?

Ah, Boulder . . . my home town, always in the "progressive" vanguard. But this strikes me as nothing more than trendy boosterism that lets the local Trustifarians feel good and noble about themselves (not that Boulder has ever suffered a deficit in that area). That website is sure full of high-falutin' language, but unsurprisingly low on specifics. Looks like marketing to me.

"Local" has turned into one of those nebulous words (kind of like "change") that sounds great but doesn't necessarily mean what you think. Agriculturally, Boulder County isn't exactly the Fertile Crescent (it's on the boundary of high plains desert and mountains). So if oil dries up, which means less energy for irrigation and fetilizers, then options on what to grow there become limited. There's a reason Boulder used to be small sleepy backwater town: "local" environmental and geographic conditions weren't sufficient to supporta larger community.

Canada is looking good, eh?

Not to this Canadian it doesn't. Our economy depends a lot on yours. Not completely, but if you tank, it won't be much better here. Our cities also look a lot like yours - you basically can't live in most of them without a car. I'm fortunate to be in one of the few that has any meaningful transit system because it has no less than three colleges. And, with a population the size of California in an area about half the size of Russia, I don't know how much denser we could make things. Get much north of the border and it's rocks and trees and trees and rocks, as the song says, and small communities cut off because the ice they used to ship supplies over is melting. Me, I'm thinking hard about Iceland or maybe New Zealand, if they'll have me.

if we collectively plan and act early enough there's every likelihood that we can create a way of living that's significantly more connected, more vibrant and more in touch with our environment than the oil-addicted treadmill that we find ourselves on today.

This may be the worst sentence ever written. Collectively Plan are you kidding me? On second thought this isn't just bad it's Hillary Clinton graduation speech bad!

the problem with this whole local business is that it doesn't take into account the distribution systems and networks that underpin our economic activity. Is a product really local if the power used to create it comes from hundreds of miles away on transmission lines? Or if the equipment and raw materials used to fabricate the product comes from a factory in Europe? About the only thing that's local is the labor. Assuming that the peak oil prophets are correct (I'm still agnostic on the issue), our distribution networks are going to change significantly, but not to the extent that every village and hamlet is forced to set up blacksmithies and furriers in order to stave off the wolves. Hell, those systems and networks are in constant flux right now, responding to changes in the market. Those twits in Boulder can pine all they want for "regenerating community" through the manufacture of handcrafted artisan soaps and "developing local self-reliance in media" (whatever the hell than means), but it's just blather. And Elmo, if you're not an old-timer, find one and ask about the old Aristocrat Steak House at Broadway and Spruce - that's when Boulder was wonderful, before the colonization happened.

Rod:

I'm in a small city, Santa Fe, that is following a similar path to that of Boulder. I know both cities pretty well, as Boulder is where my best friend and business partner lives. Boulder has some options that Santa Fe doesn't because of the strength of it's economy. One small example: bike paths and rail trails are paved in Boulder; they're dirt in Santa Fe. We're also working in a xeriscape environment. Here's a link to a fascinating urban renewal project that is going to have a very big impact on Santa Fe, and it's reputation as an innovator in sustainability and low-impact community building:

http://www.sfrailyardcc.org/

Bless,
Doug

Perhaps not germane to the thread but Rod you could uplift us all from posting some material at random from this webpage

www.naturalhomemagazine.com/2008-05-01/trythis.aspx

to remind us a CrunchyCon home doesn't have to be slap bang in the middle of pastures or farmland - even cities as screwed up as Philadelphia have initiatives for reclaiming abandoned lots to create city small holdings (tho' livestock is limited I believe)

And take succour with this cartoon strip for the young at heart - the creators even look like they could be related to you:

www.rustletheleaf.com/images/rustle_index.jpg

H/T www.worstedwitch.com/pix/2006/02/13/rustle.jpg

Location, Location, Location:
I lived next door to Boulder Co. for several years. Some backyards in Boulder back up against the mountains; other backyards face out onto the rich farming lands of Colorado, I use to jog in thoes lands. One of the largest US feed lots and abattiors is in the next county over along with one the US's largest turkey farms. They also have Coors around the corner. So what's not to like. I and my children have watched, as Mountain Lions walk along the neighborhood streets in the outlieing sections of the town. The hunting is great, 60,000 hunters out shooting what ever moves on the opening deer season one year.
So yes, Boulder should be able to do it; government money pours in to the University and other scientific infastructure. Boulder is rich!
Sincerely, J R Dittbrenner