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PeakOil is You

PeakOil is You

The Myth of energy and GDP

Discussions about the economic and financial ramifications of PEAK OIL

Unread postby JohnDenver » Wed 20 Apr 2005, 08:35:19

Ludi wrote:
JohnDenver wrote: Cars are a luxury, not a necessity.


How will people get to the store to buy food, clothing, etc?


What I'm trying to say, Ludi, is that cars are not necessary to live a comfortable life. I don't have one and I'm very comfortable. I shop by walking. You can live at the same standard of living without a car. In fact, I would even agree with Kunstler that driving cars, and having them around, actually DEGRADES your standard of living. The "necessity" of the car is just a delusion.
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Unread postby Aaron » Wed 20 Apr 2005, 08:53:00

Not in Texas, Alaska, LA, Florida, etc..
The problem is, of course, that not only is economics bankrupt, but it has always been nothing more than politics in disguise... economics is a form of brain damage.

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Unread postby retiredguy » Wed 20 Apr 2005, 09:05:04

JD, where do you live that you can purchase all of the things that you need by walking?

I live in an a village that was self-sustaining in the 19th century. With the advent of the autmobile, this village has become a suburb and most of the businesses that don't cater to comuters disappeared long ago. I can pick up groceries locally, but if I needed a shirt or a pair of shoes, I'm out of luck.

The village is servered by NO form of mass transportation. The railroad, which was the lifeblood of the village in the 19th century, is gone, the tracks abandoned and decaying.

The point that I'm trying to make is that millions of Americans live in places like this. The choice is to re-invent the village as it existed a hundred years ago or to relocate the population to the nearby city. To make this transition is going to be hugely disruptive and hugely expensive. How do you envision this happening within the timeframe dictated during post-Peak.
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Unread postby MonteQuest » Wed 20 Apr 2005, 19:07:52

JohnDenver wrote:
MonteQuest wrote:Oh, and John, it is not a choice once we are in overshoot, which we are.


I strongly disagree. Even a simple calculation shows that the U.S. produces way more food, shelter and clothing than is necessary for its inhabitants to live healthy lives.


Of course you do, you don't understand what is sustainable, and you never ever consider exponential population growth in any of your arguments. We produce all this abundance predicated upon readily available cheap oil and fossil fuels. A "phantom". It cannot be replaced as it is a stock, and renewables are a flow. And even if we could somehow generate the equivalent energy of fossil fuels by alternative means, the environmental sinks have limits and the land necessary for food would be displaced by energy crops.

Even if we eliminated all waste, all it does is push the day of reckoning into the future with even greater consequences.

The cumulative biotic potential of any given species always exceeds its habitat. It has never been otherwise. You can postone and evade but never escape this fact.
Last edited by MonteQuest on Wed 20 Apr 2005, 19:23:42, edited 1 time in total.
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Unread postby MonteQuest » Wed 20 Apr 2005, 19:21:37

Licho wrote:Ok Jato, but USA didn't double population and graph is showing GDP per unit of energy. I only didnt say it clearly enough. USA almost doubled GDP per unit of energy.. It also almost doubled GDP per capita (per capita energy use remained the same).


Some people just don't read. This is the third time this has been posted. The GDP growth has been the result of debt spending based upon illusionary wealth courtesy of low-interest rates and rampant real estate speculation.

Where does the "currrent" money come from to purchase the goods and services that produce GDP figures? It surely is not from a growth in income/wages due to an increase in worker productivity. It is from the refi-ATM of inflated home equity and the daily borrowing of $2.9 billion dollars from foreign investors. How will this debt be paid off? Won't somebody have to produce some real wealth sometime somewhere?

You can produce shiploads of goods, but if there is no money to buy them, it ain't gonna add a dime to GDP. Look back at the 1930's. No shortage of goods or services, but no money and thus an anemic GDP.

Where would the US GDP be today had the Household Debt, as % of the GDP, remained at the historically high level before the current run up? What if the GDP growth came from growth in the income of households and Household Debt growth that was at 45% of the growth in GDP? The primary reason that I picked the 45% number is that it is the average for 19 years, 1965-1983, and that after 1984 the Personal Bankruptcy Filings exploded. So, we are not talking about a case of no growth in Household Debt; we are simply talking about growth in household spending coming primarily from growth in incomes. Such a GDP would be a Secular GDP with organic growth. As some of you may know, growth in household incomes, in real terms, has been poor over the past 5 years (negative for the last twelve months). How long can debt be a substitute for growth in household spending when income growth is hard to come by?


http://www.financialsense.com/fsu/edito ... /0123.html
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Unread postby Licho » Wed 20 Apr 2005, 20:43:16

So you are saying that most of this GDP/energy doubling comes from debt spending over last 30 years? Thats almost impossible, it would mean you should have total debt of about 10x annual GDP. And afaik it's nohere near that figure.
Your debt is about $7 trillions, annual GDP about $10 trillions..

So most of this growth is certainly real..
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Unread postby jato » Wed 20 Apr 2005, 20:53:36

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Unread postby khebab » Wed 20 Apr 2005, 20:57:08

Licho wrote:So you are saying that most of this GDP/energy doubling comes from debt spending over last 30 years? Thats almost impossible, it would mean you should have total debt of about 10x annual GDP. And afaik it's nohere near that figure.
Your debt is about $7 trillions, annual GDP about $10 trillions..

So most of this growth is certainly real..

Household debt?
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Unread postby MonteQuest » Wed 20 Apr 2005, 21:27:00

Licho wrote:So you are saying that most of this GDP/energy doubling comes from debt spending over last 30 years? Thats almost impossible, it would mean you should have total debt of about 10x annual GDP. And afaik it's nohere near that figure.
Your debt is about $7 trillions, annual GDP about $10 trillions..

So most of this growth is certainly real..


See? You still didn't read it. The numbers don't lie.
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Unread postby jato » Wed 20 Apr 2005, 21:29:49

Image

Montequest wrote:Where does the "current" money come from to purchase the goods and services that produce GDP figures? It surely is not from a growth in income/wages due to an increase in worker productivity. It is from the refi-ATM of inflated home equity and the daily borrowing of $2.9 billion dollars from foreign investors.


{quote added by MQ}
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Unread postby JohnDenver » Wed 20 Apr 2005, 23:00:02

retiredguy wrote:JD, where do you live that you can purchase all of the things that you need by walking?


Hi retiredguy,
At the moment, I live in the center of Osaka, Japan. I don't need a car here. In fact, I don't even need mass transit, and I have lived years of my life conducting all my business on foot or bicycle. The city is almost perfectly flat, so it's well-adapted for cycling anywhere. Basically, no one I know has a car, and anyone who does have one is "the rich guy".
I have also lived in New York City, when I was a student, and I lived the same way there.
I was living in Colorado for a few years before I moved back to Osaka, so I'm familiar with the car life, but I hated it. It has so many down sides. You can't enjoy a drink with your friends because you have to worry about getting arrested. You gotta buy the car and pay insurance and maintenance. You have to deal with aggressive a-holes in traffic and in parking lots. You're wasting all this precious time doing nothing except sit in a box like a zombie. You have to get a license, which (to a person like me who was used to living without cars) was just an excuse for the government to invade your privacy and run checks on you. Plus you have to put up with the eyesore/odor of all these cars and parking lots everywhere -- you know, "the national automobile slum". That's what I mean that the car degrades your standard of living.

The point that I'm trying to make is that millions of Americans live in places like this. The choice is to re-invent the village as it existed a hundred years ago or to relocate the population to the nearby city. To make this transition is going to be hugely disruptive and hugely expensive. How do you envision this happening within the timeframe dictated during post-Peak.


The only thing impeding a quick transition is the American sense of "dignity" (for lack of a better word). For example, suppose that your gas prices are going through the roof, and the pinch is on. You can't afford to commute, but your cousin lives close to shopping and your workplace. Why not move in with him? If you've got food and shelter, what's the big hang-up? Maybe your cousin would appreciate the extra income because he's feeling the squeeze too.

So suppose you do move in with your cousin, or rent a flop house room. You ride the bus to work, and walk to the mall. Problem solved, and you didn't have to rebuild anything. Yes, it was "disruptive", but not particularly difficult or lethal. It's like overcoming an addiction. 90% of the barrier is just fear.

As for people like yourself who are living out in the middle of sprawl, why don't you move? It's sort of like saying: "But what are we going to do about the people who are standing in the way of the oncoming truck?"
:-D
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Unread postby Wildwell » Thu 21 Apr 2005, 04:32:00

http://www.uie.org/library/REPORT_FINAL_July_2004.pdf

For the hard of understanding here is a report on energy intensity.

Let's say the US could becomes a ball park figure of 50% less energy intensive - most people in the field accept without any real loss in the standard of living.

Have a look at some of the opinions here

http://news.bbc.co.uk/1/hi/sci/tech/4000225.stm

As the price of energy rises, people use less, therefore the net result is you CAN grow and use 50% of less energy. From that point of view Simmons was wrong. It's then possible as energy prices keep rising, that people walk more, cycle more (reduces drains elsewhere because of better health) take more public transport, that sort of thing, so you become even more efficient. It's not to say the loss of jobs in one sector causes a downtown, because this has happened throughout history. For example, last week several thousand people were made redundant at the last British mass production car factory - a lot have been offered jobs with Network Rail. Once you have reduced your overall energy take then is can be compensated for with nuclear and renewables.

Whether growth goes on or how long it goes on for depends on technology and population. Saying we cannot do X now, because so and so isn't possible is like saying man couldn't travel more than 14mph in 1800.

I'm sure someone will say - Look by 2050 we will need 60% more energy. Well that may be true because of rising living standards, but that's not the point, because most of this is the third world and they will start by using nano renewable from scratch. My point is individual economies can grow using less energy year on year. And since when was the United States particularly interested in the well being of any other country anyway? It seems to me they will threaten any country or stop buying their products if they won’t play ball – look at what happened to French spring water.
Last edited by Wildwell on Thu 21 Apr 2005, 08:01:51, edited 2 times in total.
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Unread postby tokyo_to_motueka » Thu 21 Apr 2005, 05:54:18

JohnDenver wrote:
retiredguy wrote:JD, where do you live that you can purchase all of the things that you need by walking?

I live in the center of Osaka, Japan. I don't need a car here. In fact, I don't even need mass transit, and I have lived years of my life conducting all my business on foot or bicycle. The city is almost perfectly flat, so it's well-adapted for cycling anywhere. Basically, no one I know has a car, and anyone who does have one is "the rich guy".
I have also lived in New York City, when I was a student, and I lived the same way there.
I was living in Colorado for a few years before I moved back to Osaka, so I'm familiar with the car life, but I hated it. It has so many down sides.

so your suggested solution is: everyone in the US and Japan (and all other industrialized/industrializing countries) moves into an urban centre that is flat and within which they can get everywhere they need to go by foot or bicycle?

this is like saying everywhere should become like China 30 yers ago but have ALMOST ALL the population in the urban centres. the remaining rural popultion would never leave their farms of course, except on horseback/foot/bicycle.

sounds very practical. :lol:
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Unread postby Wildwell » Thu 21 Apr 2005, 05:59:04

jato wrote:Image

Montequest wrote:Where does the "current" money come from to purchase the goods and services that produce GDP figures? It surely is not from a growth in income/wages due to an increase in worker productivity. It is from the refi-ATM of inflated home equity and the daily borrowing of $2.9 billion dollars from foreign investors.


{quote added by MQ}


A lot of the debt of the US has been sunk into wars and cars. So you know what the answer is?
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Unread postby retiredguy » Thu 21 Apr 2005, 08:31:46

Hi JD,

What you are suggesting is a 180 degree shift in thinking and being very sanguine about it happening smoothly. The 250,000 people in this county who live outside of metro Madison aren't all going to be able to converge on the city.

I'm choosing to stay where I'm at. I'm in the old section of the village, two blocks from what remains of downtown and two blocks from the railroad tracks. My thinking is that when energy costs make auto driving prohibitive, rail service will be revived and the village, along with other villages in this county will become a distribution center for groceries, dry goods, etc. Those folks living in suburbs that aren't close to a distribution center will be in a world of hurt.

I agree with you regarding automobiles and the blight they cause. However, those of us who feel that way are in the distinct minority in the US. To change this attitude is going to be EXTREMELY disruptive, maybe violent. Even during the Depression, people drove cars.
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Unread postby Wildwell » Thu 21 Apr 2005, 09:50:31

I suspect governments will put in some some of system where you need to prove you need a car. I don't think it will happen very smoothly either, but I see little choice at the time of writing. One thing we all agree on is something has got to give.
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Unread postby johnmarkos » Thu 21 Apr 2005, 10:13:51

Suburbs will probably become small towns -- many of them were built around small towns anyway. In the typical bedroom community, the owner of one house might paint it green and turn it into a grocery store. The owner of another might paint it blue and turn it into a general store. They built these subdivisions for housing, assuming people would be able to drive five miles for their necessities. When people cannot, I suspect zoing laws may change, allowing people to transform buildings into something other than their original intent.

Nonetheless, it will probably be an awkward transformation. Life in pre-defined cities, towns, and villages will likely be far more comfortable.
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Re:

Unread postby Tanada » Wed 14 Mar 2018, 09:39:50

Wildwell wrote:You can do a lot with statistics that’s for sure!

Here’s another one to ponder.

http://www.statistics.gov.uk/cci/nugget.asp?id=151

And this is interesting: *Direct* use of energy by sector:

http://www.statistics.gov.uk/statbase/s ... ?vlnk=5542

All energy 2002 (millions barrels of oil eq):

Agriculture 2.0
Wholesale and retail trade 8.7
Transport and communications 31.3
Financial 6.8
Public admin 4.6
Education and social work 5.8
Manufacturing 48.1
Mining and quarrying 4.8
Electricty, gas and water supply 52.2
Construction 1.4
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