Thursday, December 15, 2016

Supporting everything that smells bad: Donald Trump's new energy policy promises to be a disaster



Michael Klare has published an extensive comment on "Tomgram" about what appear to be the current policy choices by Donald Trump on energy and he correctly notes how contradictory they are. Basically,
The main thrust of his approach couldn’t be clearer: abolish all regulations and presidential directives that stand in the way of unrestrained fossil fuel extraction, including commitments made by President Obama in December 2015 under the Paris Climate Agreement.
In other words, Trump seems to be locked in a market-only vision of the problem, thinking that physical realities have no role in the extraction of fossil resources. On this, he is surely not alone, but the problem is that deregulation is not so important as Trump seems to think. It was not because the market was over-regulated that oil prices spiked up to $150 dollars/barrel in 2008 and kept hovering at around $100/barrel from 2011 up to late 2014. And it was not because oil production was suddenly deregulated that prices collapsed to below $40 in 2015. The oil market, as all markets, suffers from instabilities that may be, sometimes, cured by regulations. Eliminating all the regulations may well cause further price swings and wild oscillations, rather than increase production.

If oil companies are in trouble, right now, is because the oil prices are too low, not because oil extraction is over-regulated and Trump's policies - if they were to work - may damage the fossil fuel industry even more. That, in itself, would not be a bad thing - especially in terms of the effects on climate. The problem is that Trump's ideas to revitalize the fossil fuel industry may not be limited to deregulation, but could involve actively discouraging renewable energy, a policy that, for instance, the Italian government has been successfully applying during the past few years.

So, why does Trump want to do such a thing? Here, we can only imagine what passes in the mind of a 70-year old man who is not known to be especially expert in anything. Klare puts forward a possible explanation as:
To some degree, no doubt, it comes, at least in part, from the president-elect’s deep and abiding nostalgia for the fast-growing (and largely regulation-free) America of the 1950s. When Trump was growing up, the United States was on an extraordinary expansionist drive and its output of basic goods, including oil, coal, and steel, was swelling by the day. The country’s major industries were heavily unionized; the suburbs were booming; apartment buildings were going up all over the borough of Queens in New York City where Trump got his start; cars were rolling off the assembly lines in what was then anything but the “Rust Belt”; and refineries and coal plants were pouring out the massive amounts of energy needed to make it all happen.
And don’t forget one other factor: Trump’s vindictiveness -- in this case, not just toward his Democratic opponent in the recent election campaign but toward those who voted against him. The Donald is well aware that most Americans who care about climate change and are in favor of a rapid transformation to a green energy America did not vote for him,
Given his well-known penchant for attacking anyone who frustrates his ambitions or speaks negatively of him, and his urge to punish greens by, among other things, obliterating every measure adopted by President Obama to speed the utilization of renewable energy, expect him to rip the EPA apart and do his best to shred any obstacles to fossil fuel exploitation. If that means hastening the incineration of the planet, so be it. He either doesn’t care (since at 70 he won’t live to see it happen), truly doesn’t believe in the science, or doesn’t think it will hurt his company’s business interests over the next few decades.
This interpretation by Michael Klare may or may not be correct but it underlies a basic problem: elections give power to people on the basis of their promises, but nobody really knows how they will behave once they have power in their hands. The world's history is full of leaders who had mental problems of all kinds or even just had a vision of the world that was completely out of touch with reality. The result was normally unmitigated disasters as leaders, in most cases, refuse to learn from their mistakes. And not just that, they tend to double down, worsening things.

About Donald Trump,as I discussed in a previous post, nobody can know what's going on inside his mind. All what I can say is that America may badly need God's blessing in the near future.





11 comments:

  1. "And don’t forget one other factor: Trump’s vindictiveness -- in this case, not just toward his Democratic opponent in the recent election campaign but toward those who voted against him."

    To be fair (and it's hard to be fair sometimes) Trump has not appeared vindictive. He incurred the wrath of many of his followers by very publicly not pursuing Hillary despite the many threats and promises previously made.

    Likewise I read today that he met with and praised Bezos and others like Schmidt who really did and still do carry the fight very emotively against Trump via the Washington Post and to a less public extent Google.

    Of course he needs them and their support but it's surely good to see this approach and that would not be easy to do for somebody who was truly vindictive by nature or shallow of thought, it would be so easy to do the reverse .. "I'm president elect now and I'll show you how it feels".

    Trump has demonstrated no vindictiveness towards Republican rivals with whom he fought very bitterly but has since considered appointing as administrative heads who he would have to rely on and work with.

    So in the light of Trumps current actions in contrast to his previous threats, "vindictiveness" seems to be notably lacking. Here's hoping Klare has not hit the mark with some of her other assessments too. :-)

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  2. Regarding your last paragraph: my wife and I close our evening prayer with “…grant power and wisdom to all who strive to protect our planet, and bless the United States of America.” We see how our incoming Presidential Administration so casually disregards military, diplomatic, economic information as casually as tho it concerned the climate (which it generally does).

    David Collins

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  3. The number of pearl-clutching elites crying crocodile tears over Trump whilst begging Jeeves to fetch the fainting couch is amusing, sort of like Brexit Part II. (Ugo, I'm not lumping you into that group, just making an observation.) Personally, I'm looking forward to Trump after 8 years of Obama's smug pontificating and middling cabinet.

    Trump's advisers will include both the CEO of ExxonMobil (as Secretary of State) and Elon Musk. The former obviously knows his stuff with respect to the economics of oil production.

    In his post-election rallies, Trump links reducing federal regulations and taxes with increased fossil fuel production and jobs. While I'm always happy with the federal government going away, I think he's overselling things, as increasing supply won't cure the "problem" of low prices.

    The most frustrating aspect of Trump is trying to tease out what he really means, as his way of communicating involves a bizarre but devastatingly-effective combination of outright trolling, masterful persuasion, and connecting with the audience in very real terms.

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  4. Hello Ugo
    To begin, I would say that the oil [ and our entire society ] is a heat engine and therefore runs according to the laws of physics [ especially conservation of energy ] and not according to market superstition.

    Think of of the industry as a jet engine. To keep functioning it must be able to produce sufficient power to generate thrust, to drive all the auxiliaries connected to it [ alternators, hydraulics, air bleed system, etc... ] and most importantly drive its front end, the intake compressor and the fuel injection system. If there is not sufficient power, the engine stalls and goes into a fires out condition.

    Now a very large amount of energy must be be expended to extract and prepare the oil for use before it can itself produce energy just as the jet engine must expend energy to compress air, inject fuel before the combustion chambers can fire. Now this means that the energy use of the oil must generate sufficient economic activities of the type that can generate the resources required to drive the oil industry's "front end".

    Now I interpret the oil price collapse as indicating that the economy no longer generates the resources to sustain the oil system front end, the systems is in a fires out condition.

    A healthy oil system is is a tremendous capital generator, it regenerate money the way the Krebs cycle regenerate ADP into ATP and moves it out into the greater economy thru a network of banks and insurance company in the process increasing the imbedded energy of the social-economic system. The channels thru which this as accomplished have in the past century spread to every corner of the economy boosting the social structure and financing governments and corporations. One of the feature of these transfer path that I think I see is that the flows are reversible, if the oil system has an energy deficit, by conservation of energy principle it will draw the difference from the social-economic-political structure itself, extracting entropic energy [ ΔS ], removing its imbedded energy by collapsing the structure, the process continuing until the functionality of the financial has deteriorated so much that it can no longer transfer resources.

    Now the oil price collapsed in 2014 and oil industry seems to be turning into a financial maelstrom dragging more and more resources to itself with the surrounding society is becoming like a masonry structure whose cement is being drawn out and beginning to to fall in on itself. I think this is the same process that destroyed the USSR, its oil system stalled around 1987 and then the soviet system disintegrated, with oil production collapsing by 50% by 1994 in a Seneca collapse.

    My own prediction is a 60% collapse of oil within a decade with a complete collapse of the globalist social-political system.

    I'll add details later.

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    1. Ugo

      The sum of the problem is that more and more parasitic energy "uses" have been loaded on an overstrained energy system while it has been fed with increasing quatities of rotgut, while pretending this is just as good as premium gasoline, the result will be a sudden failure of the system, not a decline.

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  5. Ugo:

    As is your usual, you give us something to think about. Thanks again for your time and efforts.

    But, after the bile and calumny of this election I have come to a pretty basic conclusion:

    We're fucked.

    But, either of the two astonishly unpopular candidates would have taken us to the same place, the only difference was the style and personality. We had the choice between a thin-lipped corrupt schoolmarm and a arrogant blowhard. The plans were the same (Try to hold together the facade of neoliberalism and neoconservatism) and the choices presented to the US citizenry leads to the same destination.

    Everyone is worried because the Trump will try for a last gasp attack on the resource base of limited planet. Well Buckaroos, that train left the station a long time ago. Come to think of it, we were all on the train when it left.

    Lets say Trump makes the attempt at letting the oil companies "Drill baby Drill". Will that change the depletion rate of the fracking well or the ongoing decline of Gwahar? Nope, it most certainly won't. Will the US populace suddenly wake up to the error of its ways and divest itself of the sacred Automobile and start taking mass transit. Again nope.

    Trump as a decision maker will offer a brief rise in oil production and accelerate the negative slope of the curve after the party. But 50 years from now we will still be out of high EROEI oil and we will be making due with a lot less energy than we do now. What Trump chooses to do in the here and now is just window dressing.

    The factories and jobs aren't coming back, and do we want the pollution of heavy industry coming back anyway? The deplorables lot will not be better in fifty years, bank on it. The monetary system is a shambles, and a cashless society won't save us.

    Look, the party is over. Time to start working on what comes next, not entertain ourselves watching the thrashing of a dying dinosaur.

    I think that I will work on small local medical diagnostics for a post industrial world in decline.

    Because that is where we are going. We have always known that is going to be the destination.



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  6. Illargi also gave a nice bilious rant that is worth reading

    https://www.theautomaticearth.com/2016/12/heal-the-planet-for-profit/

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  7. There's a slight catch here in the argument. DJ Trump was 21 in 1967. So I reckon he grew up in the 60s, not the 50s. I wonder what he feels nostalgic for? Do you think he was a closet Dead Head? Although as he came from the Right Coast, more likely he was following Andy Warhol and the Velvets.

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    1. He was born in 1946; so I think we can say that he grew up in the 1950s. He should have been influenced by the cultural atmosphere of the 1950s and 1960s, but there were so many things being said and done at that time!

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  8. As Deringolade said, the party is indeed over. We are in for a real mess as we wake up from this collective 157-year hangover since the oil first started gushing, not just because of resource depletion and the mess we’re making of our planet, but also due to the way humans tend to behave under duress. Here's an excerpt from my recent essay, Requiem for the Republic:

    ---
    The really clear and disturbing parallels are between the current political climate vs. the Weimar Republic in which Hitler began his long quest for power, and the fist-pumping “Lock her up!” crowds in their stupid red baseball caps vs. das Volk cheering at Hitler’s rallies. “We share Hitler’s planet and several of his preoccupations,” observes Timothy Snyder in his book recounting “The Holocaust as History and Warning,” as its subtitle goes. We “have changed less than we think. We like our living space, we fantasize about destroying governments, we denigrate science, we dream of catastrophe.”

    It’s important to acknowledge an uncomfortable reality here. As 77,000 voters in Wisconsin, Michigan, and Pennsylvania made abundantly clear last month, life is not going well for millions of angry fellow citizens, despite our government’s warmed-over official stats touting an “economic recovery” that’s every bit as fake as the news Trump supporters have been passing around on Facebook. As Thomas Frank noted in his book Listen Liberal, “Today we live in a world of predatory bankers, predatory educators, even predatory health care providers, all of them out for themselves.”

    The problem is that there are no ready solutions to the predicament so many of our countrymen find themselves in. And when that happens, so long as people have a vote and even more so after they finally acquiesce in giving it up, the likely outcomes are grim.

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  9. The US of the 50s and 60s were not so regulation free as some tend to think.
    They had a pretty high tax on high incomes, which reduced income spread somewhat.
    Also they had some banking regulations left over from the great recession, like separation between investment and customer banking. And others, which were all deregulated in the infamous 80s and 90s.

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Who

Ugo Bardi is a member of the Club of Rome and the author of "Extracted: how the quest for mineral resources is plundering the Planet" (Chelsea Green 2014). His most recent book is "The Seneca Effect" to be published by Springer in mid 2017