[lit-ideas] Re: WSJ -- Ode to Oil -- thoughts?

Interesting that Eric should put all the emphasis on battlefield 'Evilness' rather than the White Knight protagonist. That various pieces on the battlefield should want to manipulate the environment for their own purposes is a given; that the White Knight should be apart from such activities is a naive conception.
My purpose in responding to Julie's question wasn't to cast doubt on Howard's notion that oil producing nations might or do seek to manipulate the US dependence on oil - they might and they do - but that in constructing his equation he forgot to mention that the US is often the worst culprit and will seek to re-shape the battlefield and dislodge the players for its own ends.
But for me, this isn't just about oil per se, but the concentration of energy-related assets into the hands of a relative few. In the US, those capital interest get ciphoned through the state, in other countries, those interests are the state. In practice there's not too much difference.
How about everybody with a pitched roof line up a series of wind turbines along their ridge. The electricity that's produced get's fed into a local community grid which will either be a positive or negative contributor to electricity on a wider scale. If it's a positive contributor, then electricity in the community is operationally free. 

Cheers

Simon
Now to make leek and potato soup.
----- Original Message ----- From: "Eric Yost" <mr.eric.yost@xxxxxxxxx> 
To: <lit-ideas@xxxxxxxxxxxxx>
Sent: Sunday, November 30, 2008 8:21 AM
Subject: [lit-ideas] Re: WSJ -- Ode to Oil -- thoughts?
Simon: It's worth reading the comments on Howard's article, which assumes the US to be a white knight protagonist on a battle field full of evilness. Howard can't seem to accept that the US is also out to fulfill it's own interest rather than just using oil to manipulate the interests of other nations - he builds an equation full of complex variables without noting the existence of the most important of them.
Simon, I always enjoy reading your notes, which have an odd unsettling and pleasing outsider ring -- much as Joseph Conrad's use of English has it -- containing both the truth and the distortion of distance. You see a lot of things we plain Yankees are utterly blind to and you also miss things through the distorting perspective of your distance and preconceptions.
First off is this "evilness" thing, which smacks of outsider perspective. Can you honestly claim that any nation, whether Omar's Macedonia or Dr. Palma's South Africa or my United Stars of Urania (guess the reference), does not try to manipulate the interests of other nations? This is the very basis of all history and no one nation (with the possible exception of now-defunct Tibet) is exempt. Nor should any one nation be singled out -- unless your motive is rhetorical. It is a given. All rational states act to do so and always have.
Second is the great "minimax oil strategy" that the oil producing nations have been perpetrating on the West for countless decades. I remember one of the Saudi Sheikh's being quizzed about this at a radio broadcast National Press Club Luncheon over twenty-five years ago. It's old news stateside and goes like this.
The US is a heterogeneous polymorphic oil glutton. Most of the reason for this derives from the fact that the US is the "first twentieth century nation," i.e., one whose infrastructure was built on the faulty premise of unlimited cheap oil. Europe and Japan, having combusted themselves in World Wars, had to deal with pricey oil first and have certain built-in advantages that make their infrastructure less gluttonous, their populations more accustomed to alternatives. They often use this infrastructural bully pulpit, in part built by Americans, when it serves their self-interest.
Hence the old mini-max game. The oil producers want to maximize the value of their resources. What else do they have? So every time a US administration attempts an initiative to overcome dependency on the oil (remember Carter?) the cost of oil will tank. This removes the economic incentives for alternatives.
The minimax game is thus: to keep the price of oil low enough to discourage the US's concerted independence from foreign oil, while keeping it high enough to maximize profitability, which will allow oil-producing nations to develop alternative economies. This should be expected. Oil-producing nations will act in their self-interest. Twenty-five years ago, I heard this being discussed.
Back to "evilness." I think the pivotal decisions that have shaped the US infrastructure occurred before WW I, including the decision to invest in Ford's cars and highways rather than an extensive system of narrow-gauge railways. JP Morgan was a major player in this. You should know him, Simon, since the House of Morgan held all the gold transactions you Europeans used in the disintegration of the Hapsburg Empire normally referred to as World War I. As the auto industry gained power, it acted in its self-interest to eliminate the train ad bus systems that stood in their way.
So when you speak of the "US" with your outsider's perspective, you are analyzing a highly complex historical conglomeration that is itself in thrall to numerous complexities. You are also omitting what many, many Americans desire.
Everyone I know would love to see the emergence of a new technical infrastructure. I personally love trains and would be content to use them for the rest of my life. I would be all-too-happy to dispense with wasteful plastics and would consider it miraculous to enter an economy where electronic trash and generic commodities were replaced by local-scaled goods.
Of course, when too many of my fellow Americans feel that way, the oil producers will have two main options: either help stimulate a mass-consumption economy in India and China (partly underway), or encourage Americans to remain in their infrastructural status quo. Evil is personal and has no place in this consideration. Instead we are discussing the self-interest of oil-producing nations, which is ruthlessly amoral, unstoppable, and to be expected. The consequences may be evil but the motivation is older then the rush to switch from copper swords to bronze swords. 

Best,
Eric



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