The Peak Oil Debate is Over

The Peak Oil Debate is Over – The following is a transcription of Dr. James Schlesinger’s keynote address: "The Peak Oil Debate is Over." Transcript provided by Rick Munroe Dr. Schlesinger served as Chairman of the Atomic Energy Commission (1971-73), Secretary of Defense (1973-75), Director of the CIA and was the first Secretary of Energy (1977-79). His wealth of experience at the highest levels of public administration is consolidated by his octogenarian wisdom. What follows is the text of his insightful presentation at ASPO-Washington on Friday, October 8, 2010. Italics have been added (either to reflect Dr. Schlesinger’s verbal emphasis or to highlight points which are particularly noteworthy).

David Broder Calls for War With Iran to Boost the Economy, by Dean Baker: This is not a joke (at least not on my part). David Broder, the longtime columnist and reporter at a formerly respectable newspaper, quite explicitly suggested that fighting a war with Iran could be an effective way to boost the economy. Ignoring the idea that anyone should undertake war as an economic policy, Broder’s economics is also a visit to loon tune land. Sorry Mr. Broder, outside of Fox on 15th the world does not work this way. War affects the economy the same way that other government spending affects the economy. If spending on war can provide jobs and lift the economy then so can spending on roads, weatherizing homes, or educating our kids. Yes, that’s right, all the forms of stimulus spending that Broder derided so much because they add to the deficit will increase GDP and generate jobs just like the war that Broder is advocating (which will also add to the deficit). So, we have two routes to prosperity. We can either build up our physical infrastructure and improve the skills and education of our workers or we can go kill Iranians. Broder has made it clear where he stands.

Challenges will grow as reserves become harder to reach – Kamel Bennaceur, the chief economist of Schlumberger who will participate on Tuesday in an ADIPEC panel discussion on new frontier challenges, shares his views on the oil and gas industry. The chief executive of Schlumberger has recently called for greater standardisation and streamlining of technologies used in oil exploration and production. Could you explain why this is important? The industry is facing more challenges because of the need to replenish the production base. That’s for both oil and gas. The industry needs to make a large effort to replace its current production sources. The other message is that the reserves will be harder to produce because they will be in remote and challenging areas. The size of the discoveries is not going to increase and in the past five years 50 per cent of oil and gas discoveries were in offshore. Even in OPEC countries the cost of production will increase.

‘A Well Tailored Safety Net’: Social Security and Old-Age Risk-Sharing – I guess my reputation precedes me at least a little bit. Jed Graham of Investor’s Business Daily has devised a new fix for Social Security and published it as A Well Tailored Safety Net (link to chapter summary) and kindly offered to send me a copy to review. Well I am in the midst of a move South to Seattle and a new job search (see note under fold) and so won’t have time for a full reading but will put some first impressions below the fold. Mr. Graham points us to a favorable review by Jonathon Chait in The New Republic A Bona-Fide Social Security Fix as well as a piece in The National Review by Reiham Salam Jed Graham on Work Disincentives and concludes with some apparent satisfaction:  It’s kind of noteworthy when these liberal and conservative publications see eye to eye on an issue as ideologically divisive as Social Security reform. It’s even more noteworthy considering that these are two of the more thoughtful people writing about economic policy. Well while Chait is a reasonably consistent liberal both him and TNR lean a lot heavier in the direction of ‘neo’ than ‘New Deal’ liberal, if we had an equally favorable opinion from The Nation maybe we could talk here.
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