My Worst Fears

In case you haven’t seen it, the peak oil panic really hit the mainstream this weekend:

Energy fears looming, new survivalists prepare

Convinced the planet’s oil supply is dwindling and the world’s economies are heading for a crash, some people around the country are moving onto homesteads, learning to live off their land, conserving fuel and, in some cases, stocking up on guns they expect to use to defend themselves and their supplies from desperate crowds of people who didn’t prepare.

“There’s going to be things that happen when people can’t get things that they need for themselves and their families,” said Lynn-Marie, who believes cities could see a rise in violence as early as 2012. “People will be unprepared,” she said. “And we can imagine marauding hordes.”

Wrapped up in that story are my worst fears – that the Doomers are right and we are headed toward a disaster. But note that this is my worst fear, and not my expectation. There is a big difference. My expectation is that we have several years of true gut checking – where we will find out just how low we can reduce our fossil fuel usage. (In fact, that’s part of the reason for my thought experiment on $100 gasoline). It will be a difficult time (especially economically), but unlike the Doomer view, I don’t see a massive die-off. I think we have a whole lot of fat we can cut before it comes to that.

But that doesn’t mean I am unaware of – or unprepared for – the worst case scenarios.

25 thoughts on “My Worst Fears”

  1. FWIW, I’ve been weeding “peak oil” sites from my reading. It’s why I drop by here now only rarely.

    What I find is that I can read the energy news without the peak oil filter, and more importantly, I can interpret the energy news without the in-culture group-think.

    I did bop over to TOD (as I exhaust my weekend reading material) and I did see your post there. I think a “spoken fear” was answered with in-culture group-think.

    You know Robert, you could do a nice piece on the peak oil fears that did not come to pass. Here we are, after all, at $4/gal with hardly any commotion.

    There have not been gunfights at gas stations, the rich have not retreated to their armed compounds, etc.

    Instead we continue with that messy and imperfect adaption I talked about 2 years ago.

    We have a lot of things the doomers of 2 years ago rejected … declining VMT, large scale adaption of hybrids, declining SUV sales.

    And yet like Wall Street “perma bears” the peak oil “perma doomers” are ready to re-draw their dire prediction, one based on THIS status quo, while rejecting all the evolution beneath their feet.

    That’s why I don’t read ’em. We get a truer picture by being part of society, and not rejecting it.

    Society moves, doom remains the same.

  2. Well, if we ever do get a gigantic price hike in oil all the sudden here’s a headline I can see

    “Motorcycle sales up 1000%”

  3. RR-
    Your worst fears….are not grounded in economics.
    Oil demand is waning right now. Therefore, the projections of the world “running out of oil” are deeply flawed. Demand is not growing at 2 percent annually compounded; it is shrinking.
    GM says (I know, it is GM, still…) the Volt will be sold in 2010. You have to admit, even in your gloomiest moments, that the Volt shifts energy demand from oil to the grid. And no one, even in gloomy moments, suggests we cannot supply the grid. Solar, geothermal, nukes, wind, even coal if we have to. New power plants are not that expensive.
    The “worst case” scenario is that we go to PHEVs such as the Volt. And if GM can make the Volt, imagine what the Japanese will be making in 10 years.
    I call that the “worst case” scenario, though I think the clean air and quiet city streets would be quite nice.
    The more realistic scenario is that oil prices come down, or possibly collapse. Seriously, the Iranians cannot sell what they produce right now. In past oil markets, the “tankers with no place to go” picture preceded collapses.
    There is much to suggest this commodity boom is speculation, fueled by hundreds of billions of leveraged dollars flowing into commodity and hedge funds, I think it is the first global commodity speculative boom ever, made possible by global commodity funds and futures markets. That too suggests collapse, rather than a long secular decline, is ahead for oil prices.
    Odograph: I too find to doomsterism, defeatism, conformity, and naysaying of the P.O. crowd to be annoying. If you say we are not running out of oil, they attack; if you say we can build PHEVs, they say we will run out lithium (on scantest evidence); they say we cannot build nuke plants, solar plants, geothermal plants, coal-fired plants (although Germany is doing all of that and France is nuked up to the tune of 80 percent of its power).
    The doomsters have had a great run. Oil has risen from $10 in 1998 to $133 or so today. Ouch.
    Still, even now, we are paying less than Europeans did for oil and gas pre-run-up. Their economy survived high prices. Ours will too.
    When I worry, it is about the wretched state of political leadership in America. I worry we are becoming a Mexico, in which the powerful top tier’s primary goal is to maintain the status quo, not advance the nation. Our free press is becoming flaccid, obsessed with celebrities. Websites such as RSquared are taking up the slack, and presenting serious topics.
    I have great faith that the people of the U.S. are good-hearted. I hope they find the right path through the energy picture ahead. RSquared is doing its part to help.
    Except for RR’s gloomy days.

  4. Human psychology looks at a growth curve and thinks it will always go up and up and up. In the real world, bubbles burst.

    The actual shortage is a shortage of human intelligence, ingenuity, and skill. The human infrastructure to churn out the precision steam turbines, wind turbines, solar thermal plants, offshore energy structures, etc. is simply not there.

    The peak oil doom-seekers have always been looking for doom. Peak oil is the crisis-du-jour for the little darlings. It gives them something to think about besides watching Mad Max sequels over and over in their bunkers.

  5. FWIW, I’ve been weeding “peak oil” sites from my reading. It’s why I drop by here now only rarely.

    FWIW, this isn’t a peak oil site. I talk about the subject some times, but it’s actually pretty rare. Of the past 20 essays, this was the only one to discuss peak oil.

    This is an energy site, and peak oil is an energy topic. We know that oil is going to peak, maybe soon. How that plays out is of great interest to me.

    I have never been a Doomer, and I believe we will adapt. But that doesn’t mean that the issue doesn’t concern me. I am not quite as worry-free as you are, as I do see $4 gasoline beginning to bite. The airline industry is struggling, long haul trucking is struggling, budgets are stretched. It is playing out much as I expected: Some pain, but not doom.

    Cheers, RR

    P.S. Don’t be a stranger.

  6. Odograph,

    Good points,people and societies adapt to change.

    In my mind the biggest risk we face are the politicians doing something stupid.

    TJIT

  7. to doom or not to doom

    in my opinion storing extensiv food and all the other things will not bring the desired effect if the world goes upside down. Theft will be a big problem.

    My wife and I follow the recommandation from the 60’s: have some cooking oil, flour, pasta, rice and (if you have a sweet tooth), some sugar handy, covering 2 month. Recycle it regularly. We added 1 year supply of washing powder, as it is very energy “loaded” and difficult to obtain during a crisis. The rest is psychological: if you managed to get a good paying job in this world, you should be clever enough to get you going in the next world.

  8. Al fin-

    The human infrastructure simply isn’t there…but it will be. Money is powerful motivator. When engineers and technical folk start getting paid like lawyers you will see a lot change….
    in my book engineers are worth 10 times a lawyer….although there is a good argument many lawyers are parasites,so the ratio is infinite….

  9. Read this article, on investment and “anchoring” and then tell me again that it is important to focus on worst case scenarios.

    In the article investors anchor on profit scenarios, but peak oil doomers offer us another sort of anchor.

    Doomers have us focus on stories (shared fears) which slowly populate our vision of the future. This is powerful human mojo … and something that must be flatly refused.

    Otherwise, those anchors start to shape they way we see the world.

    The only mature answer to true uncertainty is to accept it. Not by any rational stretch does uncertainty imply the worst case.

  10. Not by any rational stretch does uncertainty imply the worst case.

    And I don’t believe I have implied that this is the case. “The worst case”, while not my expectation, is something that I want to be aware of. That way, in the unusual even that it begins to transpire, I have thought through the implications, and have some idea for navigating through.

    Incidentally, you may like to know that I have also thought through what I would do if my house burned down.

    Cheers, RR

  11. I asked James Kunstler a similar question when he spoke at the Congress for the New Urbanism in Pasadena, CA in 2005: With so much waste in U.S. energy use, couldn’t we just ride the declining oil supply curve down, for at least a number of years?

    The best answer I could get was turbulence, that systems break down under stress. Looking back at times like the Depression, though, I think we’re more resilient.

  12. As an engineer I can say this will not happen just look at history.
    Germany in WWII had very little native oil but they did have coal from which they were able to synthesize oil from.
    They were able to fuel a massive war machine with it.
    The worst case scenario has the US doing exactly what Nazi Germany did in WWII switching to it’s reserves of coal as a fuel source and this far larger then all the oil reserves.
    To be honest we should switch to oil from coal near term and then to sustainable biofuels and hydrogen and this can be done smoothly with no pain and disruption.
    Also we should also invest in both solar,wind and nuclear power as well.
    The energy problem like many problems is nothing more then an engineering problem.
    Plus EVs like the volt and tesla will farther reduce the consumption of oil.

  13. I meant from oil to Coal so we don’t have to depend on foreign energy now.
    I should have caught that error.

  14. To be honest we should switch to oil from coal near term and then to sustainable biofuels and hydrogen and this can be done smoothly with no pain and disruption.

    I agree that there will be a massive push to switch, but I don’t think it will be smooth. I see a bottleneck in which we can’t get scaled up quickly enough, and therefore we have a few years of economic difficulty.

    Cheers, RR

  15. Ruri, Germany never managed to fuel its war economy off coal-to-oil. It used it, and it certainly stretched the existing supply a lot further, but it was never more than a minor part of Axis oil production until the Romanian fields were cut off (at which point it was about all there was, but there wasn’t enough to do more than stave off the point where stocks ran out). Basically, Germany had the problem RR identified, of ramping up production fast enough (and maintaining it in the face of bombing and other demands on industry).

  16. Your last post really reads like you are turning a blind-eye to doom anchoring, Robert.

    Is the relationship between the peak oil and the doomer community something you can talk about?

    Quote:

    “Lynn-Marie, who believes cities could see a rise in violence as early as 2012. ‘People will be unprepared,’ she said. ‘And we can imagine marauding hordes.’

    Wrapped up in that story are my worst fears – that the Doomers are right and we are headed toward a disaster. But note that this is my worst fear, and not my expectation. There is a big difference.”

    You need to reject that anchor.

    (I assume you don’t practice family fire drills every night, or visualize your family holidays in terms of fires … that would be crazy)

  17. BTW, to give newbies some background on why I can so solidly reject the worst case … let me explain that for a couple years I asked pessimists (doomers) to show me their math. I asked, I really wanted to understand, how we could get to the low-energy futures they predicted in the short times they named.

    I learned, as most peak oil readers do, that the global rate of production decline is the key. At mild declines a lot of adaptation is possible, and we have a lot of time. At moderate declines things get a little dicier and the uncertainty rises.

    But how do you get a rate of global production decline consistent with doom? No lie .. you just pick one. You say “with a 8% global decline it would be the end of the world as we know it” and then you anchor to that.

  18. You say “with a 8% global decline it would be the end of the world as we know it” and then you anchor to that.

    But I don’t anchor to any of that. What I say is that I don’t know. That’s why I play the issue over in my mind. I see trouble, and I see cause for optimism. But I think we have a tricky bottleneck to navigate, because I don’t think any alternatives can scale up fast enough to meet the demand growth forecasts. In that case, I see higher and higher prices, and the impact of that is unknown. How well we adapt to that is unknown.

    I think there is a lot of fat to cut, but as people cut fat, they are going to demand action from the government. Many different ways this could all go. Some ways look more likely to me than others. That doesn’t mean I still don’t play out the movie in my head of how we could get to more troubling scenarios.

    Cheers, RR

  19. That “playing out the movie” is what my investment link is about, above.

    Another good standby is my favorite Time magazine story: How Americans Are Living Dangerously

    Combine those two and you see why I don’t think it healthy for me (or any human being) to spend too much time with those narratives of doom.

  20. Mr. Rapier,

    I’ve been brooding more than usual this weekend, based on some of the same concerns that you have. I’m an environmental engineer, and I’m concerned that my business (primarily hazardous waste site remediation) will soon fade as governments run out of money for all but necessities, hazardous waste site remediation not being one of them. Furthermore, my company has been making things more onerous for the employees lately, and I’ve had a client drop me, apparently because I have trouble hiding the fact that I think one of their engineers is incompetent.

    So, anyway, I’m musing about a career change. My skills with filtration, pumping, head loss, controls, microbiology, and so forth, would transfer well to algal biofuels production, if such outfits existed. I’ve read a fair amount about algal biofuels, and I noticed that research seems focussed on biodiesel, and algal lipid production. To your knowledge, has anyone modeled using algae biomass as an input to a Choren-type gassification / Fischer-Tropsch process? This seems like a fruitful avenue of investigation to me, since algae will have the highest productivity per unit land area and per unit water use compared to other plants. Also, algae can utilize saline water, and the Fischer-Tropsch process eliminates the need for high lipid production in the algae, allowing the use of well-adapted native species optimized for high growth rate. Please point me towards any good research you know of. Thanks!

  21. Correction of Benny Cole’s earlier post: France does not get 80% of its power from nuclear. As of 2007, they get 39% of their energy from nuclear — and 36% from oil, 15% from natural gas, 5% coal, and 5% from hydro.

    (By comparison, the U.S. gets 40% from oil, 25% from coal, 24% natural gas, 8% nuclear, and 3% hydro.)

    This comment thread is valuable. There have been disturbing events recently, and some people in the blogosphere sound alarmist, if not panicky.

    This is why I am one of Robert’s daily readers: he acknowledges reality, yet keeps his head. He always has a carefully considered and informed perspective to share.

    Odograph, I appreciate your perspective. You raise some valid points, and I actually referred a hand-wringing friend to one of your recent blog entries. That said: no one really saw the Great Depression coming. My grandmother has told me stories about living through it, and while no one in my clan died of starvation, it was hard times. And depending on what happens, we could see some hard times again. Personally I never would have expected that people in Hurricane Katrina would become capable of shooting at rescue workers (looting, sure, but shooting at people trying to help you? How messed up is that?). My point is, sometimes things can get a lot worse than one can reasonably anticipate. So you prepare, at least a little.

    I guess I am agreeing to some extent with you and Robert: we cannot reliably predict the future — but there is no reason to be complacent or sanguine rather than doomstricken. That’s why like you I’d like to see better leadership in this country. We need to roll up our sleeves.

    Also, some people are going to react very badly to “cutting the fat,” particularly those who are living close to the bone and don’t have a lot of fat to cut as it is. The end of cheap energy will mean that living poor in the U.S. will start to look more like living poor in a second world country. Some people here (who don’t speak English or have computers at home) already do. $4 gas in not a problem for them, but the big increase in food prices is.

    Finally, everything we do has an impact on the environment. I’m concerned about how losing cheap energy plays into compounding other problems. Food is expensive now, and will get moreso if we see another year of 30%+ losses in bee populations. If global warming causes more frequent and longer droughts, and our population is less taxable because we’re spending more money on necessities, it will be harder to, say, build a pipeline to bring fresh water from Canada to the American southwest (yeah, the idea has been considered, particularly by Quebec’s separatist elements).

    Economics and the market play a role in the invention of solutions for society’s problems, but they can also get in the way. Example: lots of people have walked away from adjustable mortgages they can no longer pay. As a result, record numbers of houses are being abandoned and subsequently ransacked/stripped for copper piping or wiring, the value of the homes now severely degraded. Literally millions of swimming pools in Florida now sit abandoned, full of stagnant water, perfect breeding environments for West Nile virus mosquitoes… and all this makes sense from a purely “financial” perspective, but it’s absurd on a common sense level. Who benefits from evicting all these people and the decay of their former homes? No one. Value has been destroyed. Good government could have intervened earlier and more aggressively, say by exempting adjustable rate mortgages on (only) primary dwellings from increasing interest rates for two years, in exchange for people taking a big hit on their credit ratings (government help shouldn’t be without a disincentive — we should help people, but they shouldn’t be protected from the consequences of poor choices, like buying a house when they really couldn’t afford it).

    I’m all for free markets and usually consider government a necessary evil. But sometimes government must intervene to correct the effects of an overly-brutal market. The free market did not solve the Great Depression; FDR’s New Deal programs did.

    Let’s hope we see some creative thinking from our leaders, rather than the resoundingly insipid business-as-usual served up by both parties for the last eight years…

  22. “Personally I never would have expected that people in Hurricane Katrina would become capable of shooting at rescue workers”.

    I have heard that helicopter crews reported being shot at, but the people shooting were still cut off and couldn’t give their side of the story. Later, when they were back in touch and it was no longer newsworthy, it came out that they had been following previous advice and shooting into the air to signal their location – only to be left in the lurch because they had done as they had been told.

  23. Citizen K, where are you getting your numbers for power generation? According to every source I’ve seen, the amount of electricity generated from oil in both the USA and France is trivial. And I’ve seen the 80%-from-nuclear number for France in various places.

    Wikipedia’s page on electricity generation (I know, not the most reliable resource, but these specific numbers do appear to be reliably cited) seems to contradict your numbers.

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