BusinessDesk: Oil industry prepares to face opposition to unconventional oil exploration, like deep-sea drilling and hydraulic fracturing

Keep your eyes on this one

http://newenergytimes.com/v2/news/2012/LENRGoldRushBegins-atNASA.shtml

If at first you don't succede buy, and buy again.

Nats have got 2 years to get some serious mining/exploration underway before the other clowns kneecap it

Nic the NZer - would you please have a wee think, before blurting on about 'the economy'?

Think about what money is.

Think about what underpins it.

Then work out when that system is in trouble.

http://thearchdruidreport.blogspot.com/2011/12/future-cant-pay-its-bills.html

"Let’s step away for a moment from the game of arbitrary tokens we call "money," and look at the economy from a thermodynamic perspective, as a system for producing goods and services by applying energy to an assortment of raw materials".

This push probably doesn't need anybody opposing it, indeed it's interesting to see the need for lobbying on its behalf.

What it does mean, though, is that we are demonstrably over the peak of energy production, and thus, over the peak of gettable wealth. We grew, because our supply of energy grew, both quantitively and qualitatively. We could simply do more, per time. All the easy, good quality oil is gone now, or going fast.

Deep sea, fracking, water-cutting and - most desperate of all - lignite-to-diesel, are all indications that we are well into the second half.

http://en.wikipedia.org/wiki/Oil_depletion

http://www.good.is/post/international-energy-agency-s-top-economist-says-oil-peaked-in-2006/

It doesnt last much longer with double the resource:

http://www.oilcrisis.com/bartlett/hubbert.htm

These folk, then, are looking for the stuff that underwrites wealth. Meaning, without energy, no goods and services, nothing to buy.

That begs the question: If they're pask peak volumetrically, and they're clearly past peak qualitatively, then the artificial wee fiat fiscal system (invented in the up-times) is buggered. Stuffed. A fiscal ex-parrot.

You can expect (folk like me and others here have thought about this for years) rallies and crashes from here on. Rally - and the 'price' of oil ramps, which crashes the system (eg no airline is viable beyond $150/barrrel) which drops the price, whereupon it tries to go again.

In that scenario, 'bankable' projects, including exploration, don't get funding. The speed of the global slide, from here on in, means that it is very unlikely indeed that much beyond exploration will ever happen here.

The biggest stuff-up of mankind, was the assumption that wealth was somehow something you could just 'have', irrespective of the planet supplying it. The Greenpeace types have to work out whether they can live in a world ex fossil fuels, and would be better applying their energy (ha) to that. The exploration companies are past making a 'profit' now, the stone having less and less blood to give, so to speak.

And we have to morph as far towards to a sustainable state as we can, while we still can.

We're already too late with that:

http://www.theoildrum.com/node/2960

Excerpts from "Straight Talk About Economic Inequality" by Carl Horowitz

Last May the Paris-based Organization for Economic Co-operation and Development (OECD), a consortium of nearly three dozen advanced nations founded in 1961 to promote social progress and free trade, released a widely publicized study, “Growing Income Inequality in OECD Countries: What Drives It and How Can Policy Tackle It?” From the mid 1980s until the onset of the current global financial crisis, noted the authors, real disposable household incomes in OECD nations (the U.S. being one) increased annually on average by 1.7 percent. But growth hasn’t been evenly distributed, say critics. Too many people are being left behind, a reality owing heavily to increased foreign direct investment in OECD countries and rapid adaptation of new technologies that render long-valued skills obsolete.

America is now beset with inequality, the study noted ruefully. Indeed, our Gini coefficient not only increased, it increased to nearly 0.35 by the late 2000s, becoming in the process the least equalized of all surveyed OECD-member nations, second only to Mexico, whose figure was 0.45. Among nations with rising inequality, the Scandinavian countries and the Czech Republic had the least disparities. France, Hungary and Belgium exhibited negligible change. If it’s any comfort to us, the only countries experiencing less inequality over time were Turkey and Greece, with Greece winding up by far the more equal of the two. As an aside, most Greeks these days don’t seem impressed.

OECD saw the data as a wake-up call for an aggressive program of economic redistribution. The organization’s secretary-general, Angel Gurria, declared at the report’s launch: “The social contract is starting to unravel in many countries. This study dispels the assumptions that the benefits of economic growth will automatically trickle down to the disadvantaged and that greater inequality fosters greater social mobility. Without a comprehensive strategy for inclusive growth, inequality will continue to rise.” Translation: If you’re rich, prepare to part with a lot more of your money.

In America, meanwhile, the rich are getting richer at a far faster rate than anyone else, notes the Congressional Budget Office. This past October the CBO released a report, “Trends in the Distribution of Household Income Between 1979 and 2007,” concluding that inflation-adjusted post-tax income among the top 1 percent-earning households during this period rose 275 percent. For households in the top 20 percent income bracket, the real increase was 65 percent. This compares to the respective figures for the middle three (the 21st through 80th percentiles) quintiles and the bottom quintile of only about 40 percent and 18 percent.

Yet another widely cited report is an analysis of Census data released this past December by the Associated Press showing nearly 1 in 2 Americans are either poor or near-poor. AP researchers calculated that in addition to the 49.1 million Americans who fall below the federal poverty line, an additional 97.3 million persons live in households making between 100 and 199 percent of the poverty level. The calculations incorporated data on medical, commuting and other living costs, plus taxes.

With the market presumably unable to induce the top earners to pay their “fair” share of taxes, government must step in, the argument goes. Ours, at least, is trying. Last September President Obama unveiled a proposal to raise $1.5 trillion in new taxes over the next decade.

Some dominant assumptions are that economic inequality is rapidly worsening; tolerating its further progression would be an injustice; and America bears a special moral burden to rectify the situation.

These assumptions need to be challenged. Here, then, in abbreviated form, are several reasonable retorts.

First, affluent households didn’t get that way off the backs of others. “Income is not a zero-sum game,” notes economist Steven Kaplan of the University of Chicago. “Somebody else’s income does not come at your expense. It could…but in general these numbers don’t have automatic implications for the 99 percent.” In 2011, the number of millionaire households in the U.S. was 8.4 million, an 8 percent rise from the year before. Can anyone argue that this increase caused suffering among non-millionaires? By the logic of zero-sum economics, non-millionaires should have done very well in 2008, a year in which the millionaire population dropped by 27 percent. As we all know, it was a bad year across the board.

Second, the number of households in income quintiles for any given year will be identical, but the roster is constantly changing. Those in the top income brackets in 1979, or for that matter 1999, weren’t necessarily the people who were there in 2007. Let’s have a look at the millionaires so reviled by the Occupy Wall Street demonstrators. The Washington, D.C.-based Tax Foundation recently went over IRS tax returns for 1999 of 675,000 millionaire households and followed them on a year-by-year basis through 2007. Just one year later, in 2000, only 338,000 of these households had remained millionaires. And only 38,000, a mere 6 percent of the total, had retained their millionaire status for the entire period. Even more crucial were advances in upward mobility. The Tax Foundation study revealed that three-fifths of the households in the bottom quintile in 1999 had moved to a higher quintile by 2007. And about a third in that lowest quintile had moved to the middle quintile or higher. “The land of opportunity” remains more than a cliché.

Third, income is related to family structure. Non-elderly husband-wife families have higher incomes than other households, if for no other reason, than the fact that married couples have two potential full-time earners. But they constitute a progressively falling share of U.S. households. In 2010, they represented 48 percent of all households, down from 53.8 percent in 2000 and 56 percent in 1990. In constant (2009) dollars, the median income of married-couple families in 1990 was $63,469, rising to $71,627 in 2009. For female-headed households, no spouse present – which has accounted for about 30 percent of all households for the past two decades, but more than double from 1970 – the respective figures were a mere $26,937 and $29,770. Related to this, 40.7 percent of female-headed households in 2010 lived below the poverty line; for married couples the figure was 8.8 percent.

Fourth, immigrants, legal or otherwise, constituted 40 million of the nation’s population in 2010. That was up from 19.8 million in 1990 and 31.1 million in 2000. As a proportion of the total population, the respective figures for 1990, 2000, and 2010 were 7.9 percent, 11.1 percent and 12.9 percent. A little over half in 2010 consisted of Hispanics. Though not necessarily immigrants, Hispanics do serve as an effective proxy for research purposes when detailed ethnic breakdowns on immigration are not available. And the Hispanic population increased during 2000-10 by a whopping 43 percent, whereas the non-Hispanic population as a whole rose by about 5 percent. Moreover, Hispanic incomes in 2010 were only $37,759, well under the $54,620 for non-Hispanic whites. Putting these things together – rapid population growth and far lower incomes among Hispanics – an inconvenient truth comes out: Widening inequality is largely driven by an “inclusive” immigration policy. Don’t expect any presidential candidates, Democrat or Republican, however, to make this point.

Fifth, inasmuch as other countries, especially in Europe, have less income inequality than us, it is largely because their larger welfare state edifices rest heavily on high taxes and bank debt. Many European Union parliaments lately have passed, or are considering passing, tough austerity packages to avert pending disaster. Here is one disturbing indicator: EU nations have a composite 20 percent unemployment rate for persons under age 25. For Italy, Greece and Spain – each in deep financial crisis – the respective figures are roughly 28 percent, 38 percent and 45 percent. European investment advisor Patrick Young puts it this way: “The eurozone bailout fund is on the verge of running out of money as soon as one of those major economies such as Spain or Italy defaults.” Even governments that pursue economic equality, in other words, are coming to grasp its inherent limits. They have no other choice.

There are other arguments against aggressive equalization of incomes, such as the Census Bureau’s non-inclusion of in-kind benefits (e.g., Medicaid, housing vouchers, food stamps) as reportable income. The larger point is that economic equality, beyond a certain point, can be achieved only at a high cost. It’s true that a nation can’t afford to leave segments of its population behind. But way to inclusion, here or elsewhere, shouldn’t burden the most productive members of society with high taxes in order to cover the bills of those who can’t or won’t pay them. Inclusion instead ought to be achieved through such means as economic growth, low taxes, enforceable property rights, free flows of information and limited immigration.