Will Dubya wear a sweater in the Oval Office?

Discussion in 'The big picture' started by heuristics, Nov 28, 2005.

  1. heuristics

    heuristics Junior Member

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    Created: Sep 27 2005 By Nouriel Roubini, from his Global Economics blog, RGE Monitor. Reproduced as "fair use".

    Will Dubya wear a sweater in the Oval Office when oil prices reach $100?

    When oil prices sharply spiked after the Iranian revolution of 1979 the press had a field day making fun of President Carter turning down the Oval Office thermostat to save energy and wearing a sweater in the Oval office.
    So, when oil prices will spike to $100 per barrel will President Bush also start wearing a sweater or, better, a warm jump suit as he enjoys jogging on the South Lawn more than spending time in the Oval Office?

    This is an administration that for years had literally made fun of supporters of energy conservation and of proposals to reduce energy consumption (as in their view Americans had a God-given right to gas guzzler SUV's). This is also a country where folks were justifying their driving a Hummer by saying that it was their way to "support our troops in Iraq", thus forgetting that those monster gas guzzlers were allowing Saudi oil to finance fundamentalist Islamic madrasas in Pakistan that will produce the new Osama Bin-Laden of the future.

    Therefore, yesterday's plea by the President to car pool and reduce non-essential driving is an ironic reversal of fortunes and views. But reducing trips to the mall with your SUV or Hummer or wearing two sweaters in your cold home and Oval Office will not help much, as a cold winter may lead to skyrocketing natural gas and heating oil prices now that natural gas production has been also disrupted by "Katrita". Indeed, we will now pay the price of years of reckless energy policies where little was done to enhance production and refinery of oil and less than zero was done to conserve energy and reduce its demand.

    For years, repeated calls to increase fuel economy standards were rejected by the administration and the auto industry lobby. Similarly, any talk of a gasoline tax has been taboo for years and wiser minds - such as Senator Kerry and others - who hinted about the idea of such a tax were pummeled with scorn and derision. So, now we pay the costs of years of limited supply and refining capacity (as the last US refinery was built in the late 1970s) and rising demand both at home (where we did everything to avoid conserving energy) and abroad (China, India, etc.).

    And yes oil will go above $100 per barrel in the next three years. Why? Because of the basic laws of demand and supply. Global demand for oil is growing at about 2.1% per year or about 2 mmb/d (million barrels a day) per year. So, new net supply has to increase by as much just to maintain prices at current high levels. But since existing production fields get depleted at the rate of over 4 mmb/d per year, new production from new oil fields has to be at least 6 mmb/d per year just to ensure that the additional net demand is satisfied.

    And who and where will produce this extra 6 mmb/d per year? Iraq where production and exports are falling because of a worsening security quagmire? Iran where the new government has stopped investment and where output production is falling (leaving aside the larger supply shock when the US - Iran confrontation on nuclear proliferation will come to a peak)? Saudi Arabia that is threatened by bouts of terrorism and a potential Shiite revolt in the oil rich regions? Russia where the Putin bullying of oil companies and oligarchs will slow down FDI and investment in the oil sector? Venezuela where Chavez policies will reduce exploration, investment and production? Nigeria where civil war threatens production in the oil rich regions? The Gulf Coast that will be pummeled over and over again by hurricanes as man-made global warming is likely to make future hurricanes even more devastating than the current ones?

    So, where will the new 6 mmb/d per year new production come from? We would be very lucky if, between OPEC and non-OPEC producers, we get two thirds of this new production per year available between now and 2010. Thus, based on standard elasticities of demand for oil in face of a highly inelastic medium term supply, this implies that we will oil at $100 per barrel well before the end of this decade. Of course, a ugly US and global recession will be triggered by such a spike in the price of oil that will then push oil and commodity prices down as demand and the economy sharply contracts in the recession.

    So, dear American consumer: even if your budget is already very stretched by high gasoline prices, you may want to buy an extra thick wool sweater this winter and switch off your heating unit altogether. Or take a course in knitting if you cannot afford a new sweater. Hopefully, Dubya -freezing himself in his jump suit in the Oval Office - will also feel your pain.
    End of article. ///
     
  2. christopher

    christopher Junior Member

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  3. frosty

    frosty Junior Member

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    the price fo fuel in the USA is ridiculously cheap :evil: during katrina posters on another board I visit were whingeing that it might get to $3 a GALLON :evil: :evil: :evil:

    frosty
     
  4. christopher

    christopher Junior Member

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    Here in Belize, gasoline runs USD5 a gallon, andd won't be there long as the country is broke form poor management, chroneyism and out right theft.

    Diesel is USD3.50 per gallon...

    Jimmy Carter was the most honourable man to have lived in the Whitehouse in my life. He was not a particularly effective president, I guess, but he was motivated by moral thoughts stemming from his deep faith.

    He has remained active since he left the whitehouse, especially with Habitat for Humanity, which helps poor people build and then buy houses.... I admire and respect him for his consistency.
     
  5. frosty

    frosty Junior Member

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    Hi christoper

    diesel here is cuurently arround $1.25 a LITRE which is about $5.63 a gallon

    during the crisis after hurricane katrina it got up to $ 1.40 which is over $6 a gallon

    it really pissed me off that we were paying TWICE what those fuel guzzlers in the USA were :evil: :evil:

    especially when I heard that oil from Barrow Island off the WA coast is loaded straight onto tankers and taken to the USA ..........

    quite logical as it is a chevron operation :roll: :roll:

    but what is wrong with our govt in allowing it to happen :evil: :evil: :evil:

    frosty
     
  6. Jez

    Jez Junior Member

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    If we didn't have that extra tax we'd probably be much bigger consumers too Frosty...

    Only gonna hurt more in the long run...
     
  7. heuristics

    heuristics Junior Member

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    will dubya wear a sweater

    But Frosty, it could be a WHOLE lot worse..... if we don't "give" the US our oil, well they will just come and TAKE it anyway, wont they?
    Iraq! we know about that sorry mess, but there is also Indonesia - and Nigeria - ---- so we can play all nicey-nice and let them do what they like (lie back and think of England/ or Texas or whatever) or we can close our - er legs? NO - I mean trade - and suffer the consequences.
     
  8. bjgnome

    bjgnome Junior Member

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    Carter is a good man. The world would be a very different place if he had a second term. First day in office, Reagan took the solar panels off the white house roof (yes, you read that right), and 30 years later the whole world is just that much deeper in the doo-doo.

    Jonathan
     
  9. SueinWA

    SueinWA Junior Member

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    Based on my supposition that no U.S. president in the last 200 years couldn't get into the presidency unless he could be manipulated by the powers that REALLY run the country, I can't figure out how Carter ever got to be president. He seems to have screwed the people less than any other president, esp in the last 50 yrs or so.

    I found a chart for early November of this year that showed the breakdown of U.S. gasoline prices, but couldn't find an Australian source of similar info. Do you know of one?

    Here's the breakdown of costs of one gallon (U.S.) of gasoline, at U.S. prices:

    Retail price............................ $2.66

    Crude oil cost......................... $1.35
    Distrib. & mktg costs & profit........ .29
    Refinery cost & profit................... .46
    Taxes (all) ................................. .56

    I was just wondering how Australia's price breakdown compared. Just idle curiosity, since yours is twice the price of ours.

    BTW, if I understand correctly, England has made the use of biodiesel illegal. Does the same hold true for Oz?

    Sue
     
  10. Jez

    Jez Junior Member

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    Sue,

    I'm not sure of the breakdown for our fuel, but the tax component would be quite a bit higher as a percentage of total cost.

    Biodiesel is not illegal, as far as I know they've introduced a tax on it...you have to tell the government that you're using it and pay excise I think. Until then it was free.
     
  11. frosty

    frosty Junior Member

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    Re: will dubya wear a sweater

    I dont really think it could get much worse :roll: I did say much ..........

    I mean the US is now going to fly b52 or somethings direct from Guam and bomb the NT :evil: so although we may not have an outright invasion they are contaminating our country bit by bit and eventually we will just be one big US bombing range and quarry ( see Blowin in the Wind https://www.bsharp.net.au )

    not sure what you are refering to about Indonesia ? did you know that they have one of the worlds largest undeveloped oil reserves ?( like Iraq had :roll: ) how long before the US invades them ????? could the Bali bombings be staged to provide an excuse

    and well dont talk about the FTA :evil: :evil: :evil:

    frosty

    nothing personal to the americans here ........ but your govt is pure evil :evil:
     
  12. ~Tullymoor~

    ~Tullymoor~ Junior Member

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    Just got this in my emails, thought you guys into politics may enjoy it..


    An Aussie died and went to heaven. As he stood in front of St.
    Peter at the Pearly Gates, he saw a huge wall of clocks behind him.

    He asked, "What are all those clocks?"

    St. Peter answered, "Those are Lie-Clocks. Everyone on Earth has a
    Lie-Clock. Every time you lie the hands on your clock will move."

    "Oh," said the man, "whose clock is that?"

    "That's Mother Teresa's. The hands have never moved, indicating that she
    never told a lie."

    "Incredible," said the man. "And whose clock is that one?"

    St. Peter responded, "That's Abraham Lincoln's clock. The hands have
    moved twice, telling us that Abe told only two lies in his entire life."

    "Where's George W Bush's clock?" asked the man.

    "George Bush's clock is in Jesus' office. He's using it as a ceiling
    fan."
     
  13. SueinWA

    SueinWA Junior Member

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    "nothing personal to the americans here ........ but your govt is pure evil "

    Isn't that the truth! And we can't seem to do anything about it. If we vote for or against something that "our" government wants or doesn't want, they just ignore the vote and go ahead.

    Our public school system is directed by the government to produce dumb kids and good consumers, as I've mentioned before. Most of our people are as dumb as the stuff in your vacuum bag, and have VERY short memories. Many of them think Bush is wonderful..... what does THAT tell you?!

    I doubt that the U.S. would invade Oz... it's more likely that our military bought your politicians and sold you down the river. That's how they work. Greed being as popular as it is, they don't have a very hard time finding someone's price.

    And I'm sorry they're destroying your country. They've mostly ruined ours (that's where they practiced :evil: ).

    Sue
     
  14. frosty

    frosty Junior Member

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    Sue

    I probably should have mentioned our govt is following closey just one step behind :roll: Howard isnt called Bonsai ( our own little Bush ) for nothing

    as we speak they are forcing new "terror laws" ( they are really going to use them to terrorise us :roll: ) and new industrial relations laws which will make the workers as poor as a third world country so we can compete

    our education system is in the process of being changed to also dumb people down

    our health system is moving towards a system where the poor die because they cant afford insurance

    militarism is on the rise and Bonsai now wants flags in all schools :evil: first brainwash them into jingoism then send in the recruiters :roll:

    you are right the US wont invade they have bought us already and unfortunaely not just the pollies ......... the average Australian is brainwashed by TV and our media is basically as corporate owned as yours ........ only the ABC is slightly better but bonsai and co are working on that too ........ and of course the sedition laws in the terrorising laws mentioned about will stop media criticising the govt ( I fully expect to finish up in goal because it will be illegal not to support the military :lol: )

    and I know about all the military pollution in the USA and the enormous problems with perchlorate in water :cry: (I get several US lists on the subject ) here no one has even heard of perchlorate - convenient deafness :evil:

    ahhhhhhhhh Ill climb down off my pebble
    frustrated frosty

    Tully that joke is also doing the rounds with John Howards fan cooling Jesus office :lol: :lol: :lol:
     
  15. heuristics

    heuristics Junior Member

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    Will dubya wear a sweater

    Frosty wrote "not sure what you are refering to about Indonesia ? did you know that they have one of the worlds largest undeveloped oil reserves ?( like Iraq had ) how long before the US invades them ????? could the Bali bombings be staged to provide an excuse ......"
     
    Yes Indonesia has a lot of oil - but the US doesnt have to invade - they already "control" that country. Re John Pilger's "New Rulers of the World" for all the gory details. I was absolutely SHOCKED by what I read and DEEPLY angry, shocked and saddened by Australia's complicity/involvement in all of what went on there in the 60s (when those pesky commies were trying to run their country post Dutch Colonialism and Japanese occupation).
    Which is when the US/Oz/UK stepped in and put their own stamp on things, and pretty much got the compliant (corrupt) govt they wanted. 
    The US "reserved" for itself most if not all of Indonesia's oil in the 60s, which is why they don't have to invade (under present scenarios).
    But then, best laid plans can go off the rails – look at Iraq. They'd installed themselves a tame puppet dictator in Saddam, but the mad demented bastard got out of control, and began having delusions he actually did rule his country – and of course we all know the outcome of THAT.
    His trial – which of course can only really be a piece of theatre/farce under the circumstances - is underway and they have to keep blacking out the telecast and adjourning the hearing because he keeps letting fly with too much “truth”!!!

    Re US govt being “evil”: Well yes, but the more I learn about some of what OZ has been up to over the decades, esp in SE Asia and the Pacific, I dont think we (Ozzies) should assume any moral superiority. Just like a lot of US people have no idea what games their govt is playing, ozzies have NO IDEA what our govt is doing, and unlike the US, there is no world/media scrutiny on our govt's activities, as it is assumed to be of no real global consequence.(and our media is too piss-weak to challenged Howard – after all, our media is just a few really big profitable businesses + the govt-funded (starved) ABC)
    In some strange convoluted way, Howard is right that we should be concerned about “terrorism” in our region – a lot of it will be “blowback” from the shenanigans we (our govt/big biz) has been engaged in around “our” region for decades.
    And “hello” to our US board members, they know none of our bluster is directed at them personally, as no Bush-sympathiser of any nationality could remain long on this board, IMO. ..We are all equally powerless and share our mutual frustrations.
     
  16. heuristics

    heuristics Junior Member

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    Re: Will dubya wear a sweater

    this post doubled-up for some reason, so I've deleted this second copy.
     
  17. frosty

    frosty Junior Member

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    just to say in no way do I think Australia is blameless :roll: we are the "deputy sheriff" and lately I am more and more ashamed to be an australian due to our govts behavior

    I knew some of what went on in the 60s ( suharto etc )but not that the US had reserved the oil for itself .......

    maybe when oil runs out we will have more chance of a peaceful world :D

    but then again maybe by then it will be water wars :twisted:

    frosty
     
  18. SueinWA

    SueinWA Junior Member

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    "maybe when oil runs out we will have more chance of a peaceful world ... but then again maybe by then it will be water wars "

    Too true.

    Sigh.

    Sue
     

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