Prometheus 6

Oh my ghod, it's Oil Executives for Socialism!

Pure market economics will never solve this problem. Markets do not account for the hidden and indirect costs of oil dependence. Businesses focused on the highest return on investment are not always in a position to implement new solutions, many of which depend on technologies and fuels that cannot currently compete with the marginal cost of producing a barrel of oil. Most important of all, the marketplace alone will not act preemptively to mitigate the enormous damage that would be inflicted by a sudden, serious and sustained price increase.

Let me add that any new technologies developed on the taxpayers' dime should belong to the taxpayers. I'm not saying pay back the money because future dollars can't really be compared to current dollars in this case (see the quoted paragraph...it's like trying to map dollars spent on education to salaries paid to specific individuals). I'm saying if you insist on this uber-Capitalist shit, We the People who pay for this research desearve a piece of the action.

Are We Ready for the Next Oil Shock?
By Frederick W. Smith and P.X. Kelley
Friday, August 11, 2006; A19

Could a mere 4 percent shortfall in daily oil supply propel the price of a barrel to more than $120 in a matter of days? That's what some oil market experts are saying, and if they're correct, we face the very real possibility of an oil shock wave that could send our economy reeling. Such a rapid rise in fuel costs would have profound effects that could severely threaten the foundation of America's economic prosperity.

The global oil trends now at work -- rising consumption, reduced spare production capacity and high levels of instability in key oil-producing countries -- all increase the likelihood of a supply shock. But unfortunately energy debates in this country often suggest a profound misunderstanding of these international economic dynamics. Calls for "energy independence" notwithstanding, oil is a fungible global commodity, which means that events affecting supply or demand anywhere will affect oil consumers everywhere. A country's exposure to world price shocks is thus a function of the amount of oil it consumes and is not significantly affected by the ratio of domestic to imported petroleum.

The magnitude of our dependence on oil puts stress on our military, strengthens our strategic adversaries and undermines our efforts to support democratic allies. Each year the United States expends enormous military resources protecting the chronically vulnerable oil production and distribution network while also preparing to guarantee international access to key oil-producing regions. This allocation of forces and dollars diminishes the military's capability for dealing with the war on terrorism and other defense priorities.