Saturday, June 26, 2004

George Will tries to write coherently about oil, and as usual, gets most of it wrong.

George Will, heir to the throne of most elitist, snobbish, country-club republican, (a title held for many years by William F. Buckley) tries to tell us: “Yes, the world is running low on oil supplies, but no worries as the omniscient and omnipotent free market will solve all of our problems.” Of course the man has no idea what he is talking about; but he uses lots of big words and likes to show off his vocabulary and convince you he must be right because gosh darn he sounds smart. Not only that but he looks like a Harvard professor with that bow tie and those wire-frame glasses.

As WHT at MOBJECTIVIST points out, Will has a lot of his facts screwed up (surprise!) but most of those don’t really matter. What is important is that this time, as opposed to the 1970’s and early 1980’s, we really are running out of oil. Yes, fields in Saudi Arabia will be producing oil for hundreds of years more. Yes, tar sand deposits in Canada will be producing oil for a long time. Yes, as the price goes up demand will decrease, consumers will use less, companies will get more efficient, and oil companies will find more. However, in the end (and the end is near) supply will not meet demand. Period! This will happen in the next 4 to 20 years.

Supply siders like to point out all of the interesting facts about how proved reserves continue to grow etc. etc.; but these statements belie an ignorance about what “proved reserves” are (which I won’t bore you with right now, but will save for a later post). The fact is that all of the really large accumulations of oil have been know about for a very long time. No really super giant fields have been discovered in many years (30 or more??). It’s these super-giant fields that provide the ability to meet the consumer’s demand for oil. And everyday, the world’s thirst for oil continues to grow.

In the end, the hydrocarbon era in human existence will be a mere blip in time – began in the 1860’s and ended sometime in the 21’st century. What happens in the great unraveling is worth some discussion, but I will also leave that for a later post. Suffice it to say, if you drive a Hummer, and live in a large house way out in the suburbs, and commute 2 hours every day, your property is going to be worth significantly less, and your commute is going to get very expensive. If you are under 30, I predict you will see the end of private internal combustion automobiles in your life time. Oil will become to valuable to burn.