We really only have on issue in this country, and the world for that matter for humanity which is energy. They easy oil has all been dug up. We have used about half the amount of oil that has been placed in this planet, whether from dinosaurs or god or whatever you believe. This theory of half the oil being dug up is called PEAK OIL! Google it, I have known about this theory for the last 15 years. It is very scary the ramnifications of this.
The elephant in the room.
Global oil production has been FLAT since 2005. We're digging up oil sands and shale, expensive, dirty processes that have extremely short production times per site. Deep water drilling is expensive and accompanied by new and hard to control risks - we're not doing it because it's fun, we're doing it because we have no choice. The Saudi fields are in decline - there's reason to believe their advertised spare capacity just doesn't exist. All the easy oil is gone.
Oil prices have been quite high for half a decade now (+/- blips) but despite that tremendous motivation for exploration and development, global oil production hasn't increased. We've seen some small regional increases (including in the US) but these are neither sustainable nor really significant in the long run.
Peak oil isn't about "running out" of oil. It's about a supply peak in the face of increasing demand (particularly 2+ billion people in India and China), very high oil prices, and the crushing effect these oil prices have on economic activity. This isn't crackpot tinfoil conspiracy theory, this has been in progress for years now.
And yet the talk from all sides is all about recovery and return to annual 3% economic growth, year after year. This is ridiculous! Absent a truly paradigm shifting energy producing invention (eg efficient safe clean cold fusion from seawater), those days are over. Energy drives economic growth - always has. Cheap oil is gone forever.
We ought to be making plans for the next 10-40 years based on the assumption of 0-1% average growth. Instead, we're trying to spend our way out of a recession with borrowed money, desperately hoping that doing so will buy us time for growth to take off again, and allow us to grow out of the hole.
johnnydrama said:
If we drop Medicare, no one will insure the elderly (can't be done at a profit with reasonable rates). Many of them will die sooner.
Who said anything about dropping Medicare?
The real choice is this: significant voluntary cuts to Medicare, Social Security, and the military, with a balanced budget and credible debt plan, sooner rather than later ... or pretend these sacred cows can't be touched, and let a decade or so of ongoing QE/inflation make those cuts for us via devalued dollars (meanwhile accepting the added risk of a crisis and hard crash vs slow decline that this ostrich behavior creates).
I know what's going to happen, and so do you - none of these things will be cut in any meaningful way. It's political poison because politicians are animals who respond only to money, votes, and election-cycle time frames. We'll keep on borrowing and adding to the debt. The Fed will monetize as much as they can get away with, all the while massaging numbers and giving lip service to keeping inflation at "desired" low levels. The dollar will decline in real purchasing power.
johnnydrama said:
I know it's pointless to argue with you guys
Pointless, no; difficult, yes - I think mostly because we clearly disagree on the most basic assumption of all: you think this economic slump is 'just another recession' and that a return to sustained growth is possible, I don't. I realize I'm in the minority here; other than Narcotized, I don't think very many really share my longer term pessimism.
The debt and energy issue has implications for how western civilization will fare over the next 100 years, and it's an ugly scene. You (and Obama/Romney/pals) have an event horizon of a few years, or an election cycle, or a decade.
It's no wonder we disagree so much on what should be done today. But convince me I'm wrong and I'll change my mind.
