A snapshot of the engines of innovation, as they develop new energy sources

Summary: Here are six of the dozens (hundreds?) of new companies working to develop new energy sources. This does not mean that we can ignore peak oil. It does mean that we need not plan for peak oil. It just means that we have tools and options. To make use of these tools, we need to do research about our use of energy and available sources, to build models that provide a sound foundation for large-scale crash programs. We are on the clock, as peak will likely coming while we are still preparing for it.

1. “Are Backyard Ethanol Brewers an Answer to High-Priced Gas?“, Scientific American (9 May 2008)
2. “Corvallis Cellulosic Ethanol Start-Up Receives Energy Grant“, Daily Journal of Commerce (8 May 2008)
3. “Swiss yeast developer Butalco gets financial boost” Ethanol Producer Magazine (6 May 2008)
4. “G.M. Invests in Second Ethanol Process“, New York Times (1 May 2008)
5. “BlueFire to Break Ground“, GreenTech Media (8 May 2008)
6. “Sweet New Fuel“, Forbes (23 April 2008)

Contents, with excepts

Good news about the 21st century, a counterbalance to the doomsters

As a breath of fresh air after the previous post, I recommend reading this aritcle.  I strongly recommend reading this article.  A brief excerpt gives the flavor of the contents.

“In the Air - Who says big ideas are rare?“, Malcolm Gladwell, The New Yorker  (12 May 2008)

Nathan Myhrvold met Jack Horner on the set of the “Jurassic Park” sequel in 1996. Horner is an eminent paleontologist, and was a consultant on the movie. Myhrvold was there because he really likes dinosaurs. Between takes, the two men got to talking, and Horner asked Myhrvold if he was interested in funding dinosaur expeditions.

… In Montana, which is prime dinosaur country, people had been hiking around and looking for bones for at least a hundred years. But Horner wanted to keep trying. So he and Myhrvold put together a number of teams, totalling as many as fifty people. They crossed the Fort Peck reservoir in boats, and began to explore the Montana badlands in earnest. They went out for weeks at a time, several times a year. They flew equipment in on helicopters. They mapped the full dinosaur ecology-bringing in specialists from other disciplines. And they found dinosaur bones by the truckload.

… People weren’t finding dinosaur bones, and they assumed that it was because they were rare. But-and almost everything that Myhrvold has been up to during the past half decade follows from this fact-it was our fault. We didn’t look hard enough. … “Our expeditions have found more T. rex than anyone else in the world,” Myhrvold said. “From 1909 to 1999, the world found eighteen T. rex specimens. From 1999 until now, we’ve found nine more.”

Peak Oil Doomsters debunked, end of civilization called off

Summary: a brief analysis of Matt Savinar’s Life After the Oil Crash. Are we doomed? Probably not. My title is, of course, fun but absurd. Peak oil is too vast a subject, the range of expert opinion too wide, for any blog post to pose as more than a introduction — showing one perspective of the many possible. Still, I believe this makes a good case for betting that peak oil will not result in depression and war. Please see the conclusion at the end for caveats, and the links at the end for more information.

“Are We ‘Running Out’? I Thought There Was 40 Years of the Stuff Left”

Oil will not just “run out” because all oil production follows a bell curve. This is true whether we’re talking about an individual field, a country, or on the planet as a whole.

Oil is increasingly plentiful on the upslope of the bell curve, increasingly scarce and expensive on the down slope. The peak of the curve coincides with the point at which the endowment of oil has been 50 percent depleted. Once the peak is passed, oil production begins to go down while cost begins to go up.

In practical and considerably oversimplified terms, this means that if 2005 was the year of global Peak Oil, worldwide oil production in the year 2030 will be the same as it was in 1980. However, the world’s population in 2030 will be both much larger (approximately twice) and much more industrialized (oil-dependent) than it was in 1980. Consequently, worldwide demand for oil will outpace worldwide production of oil by a significant margin. As a result, the price will skyrocket, oil dependant economies will crumble, and resource wars will explode.

The issue is not one of “running out” so much as it is not having enough to keep our economy running. In this regard, the ramifications of Peak Oil for our civilization are similar to the ramifications of dehydration for the human body. … A loss of as little as 10-15 pounds of water may be enough to kill him. In a similar sense, an oil based economy such as ours doesn’t need to deplete its entire reserve of oil before it begins to collapse. A shortfall between demand and supply as little as 10 to 15 percent is enough to wholly shatter an oil-dependent economy and reduce its citizenry to poverty. …

Before booking flights to New Zealand or Tasmania, let’s consider this carefully.

I. These forecasts seem very confident. Are they credible?

Does Savinar subscribe to the Psychic Hotline? Energy forecasts — esp. those warning of Peak Oil — have been notoriously wrong for many decades. Has the future suddenly become clear as glass? Let us parse the third paragraph on this home page.

Experts, with wrinkled brows, warn about the future

Summary: Experts often see the future with alarm, seeing the dangers but not benefits. That gets attention, from both the media and an increasinly fearful public. Both sides feed this process. It need not be so, as most trends contain the seeds of good and bad futures. This post considers two examples.

Over several decades I have politely listened to countless lectures — by professors, generals, directors of this and that — with the same message: the world changes, which might bring bad things. Thousands of words then follow. Why do we listen to such things without throwing fruit?

Planning for worst-case scenarios is just good sense. Speculative exercises, such as War Plan Red — war with the United Kingdom, including invading Canada (see here for more) — are useful on many levels. But preparing for worst-case scenarios can easily be taken to extreme. Focusing on worst-case scenarios, to the exclusion of more likely outcomes, is madness.

Except in geopolitics, where it is often standard operating procedure (more or less, depending on the person involved). Examine studies of any broad geopolitical issue, and you will many that describe change as inherently dangerous.

1. the Iraq war — withdrawing might produce catastrophic civil war, even genocide.
2. population growth — inherently destabilizing
3. population decline — inherently destabilizing
4. global cooling (a 1970’s favorite) — inherently destabilizing, all effects are bad
5. global warming (today’s favorite) — inherently destabilizing, all effects are bad
6. nations growing richer — potentially destabilizing, wrecks havoc on a country’s economy and politics, unequal distribution of gains aggravates internal conflicts.
7. nations growing poorer — potentially destabilizing

It is not that these concerns are “wrong” or “invalid”. Rather they are too often expressed in an unbalanced fashion, without considering that these things also bring benefits — and might lead to better conditions, depending on what we do. Here are two specimens of this genre. The first shows a too-typically fearful look at the future.  The author of the second sees both sides of the coin.

Fears of flying into the future

Climate change, peak oil, 4GW, social decay, ecological collapse, economic collapse, pandemics of new and old diseases … The doomsters seem to have taken control of our newspapers, as the list goes on and on, raising the question “How can civilization survive until next week?”

Imagine picking up the morning paper, coffee cup in hand. You open it and see nothing but good news. The headline story tells of a cat rescued from a tree. No stories about decaying social systems (social systems, like fruit, begin to decay after creation). No accounts of problems caused by increased wealth — no disruptive social changes, no new pollutants (replacing the old ones, like from burning coal and horses in the streets). No wars.

Would this be a good thing? No. It would mean that you died and are now in heaven. Resource scarcity, climate change, war, social instability … these represent the condition we call “life.” For thousands of generations humanity has confronted these problems as we climbed from scavengers to become the dominant species on this planet.

But what about the pollution of our environment, brought about by industrialization and increasing wealth? This is largely a myth in today’s developed nations, and a passing phase in the emerging nations. Consider life in the capital city of an emerging nation…

The city itself is overwhelmed, engulfed by changes with which it has not learned to cope, and which are scarcely understood. Some were inherent in the trebling of the population, some consequences of industrialization. Particles of grime from the factory smokestacks produce impenetrable smog which reduces visibility to a few feet … Much of the city stinks. The city’s sewage system is at best inadequate and in the poorer of neighborhoods nonexistent. Buildings elsewhere are often constructed over cesspools which, however, have grown so vast that they form ponds, surrounding homes with moats of effluvia. … And the narrow, twisted streets are neither sealed nor asphalted. People lock their windows, even in summer, but they have a lot to keep out: odors, dust…

This is London circa 1880 (a slightly altered quotation from William Manchester’s biography of Churchill, The Last Lion).

A happy ending to the current economic recession

History shows the difficulty of predicting the short-term path of economic or political events.  However, we can often see the medium-term with greater clarity.  In January 1942 none could forecast the events of the next 44 months, but it did not take an expert to see that the US would defeat Japan.  So it is with the current economic down cycle in America.

This series describes (see the list at the end) how we have begun to reduce the massive debts accumulated over the past two generations.  As I said here, there are only four ways to get rid of one’s excess debt (that, debt that cannot be repaid):

1.  Growth:  given time and rapid wage growth, the debt burden becomes manageable.  We pay it off ever more easily as incomes grow.  That was the dream solution to America’s high levels of household debt and large long-term government obligations.  It burst in 2000, and will not return in time to help us.

2.  Inflation, reducing the real weight of our debt.  This requires two things.  First, real growth in wages (no signs of this).  Second, either the cooperation or blindness of bond investors — they must either accept negative real after-tax yields, or remain oblivious to rising inflation.  The consequences are severe if our creditors (domestic and foreign) rebel.

3.  Debt can burn off the hard way as debtors default on their loans.  Both recessions and declining home prices drive defaults (involuntary and voluntary, respectively).  This is equivalent of surgery without anesthesia, resulting in bankruptcies, homelessness, decaying neighborhoods, and bank failures.

4.  Socialization of the debt.  The government can spread the burden of debt, in many different ways (that so many of our creditors are foreigners makes this more attractive).

• They can legislate to change contracts (e.g., mortgages):  reducing interest rates and payment terms, preventing or slowing foreclosures.  This spreads the debt burden from debtors to creditors.
• They can change the rules of the bankruptcy courts, with the same result as above – spreading the debt burden from debtors to creditors.
• They can directly intervene in the markets, extending loans (absorbing the resulting losses) or buying property from debtors or creditors (e.g., as the Resolution Trust Company did after the commercial real estate bust in the early 1990’s.)

Socialization is the seemingly easy path.  Done well, we have reforms like those Solon instituted for Athens — laying the foundation for its future greatness.  Done poorly, we have increased moral hazard leading to another cycle of rising debt and speculation – except that the next crash will imperil a larger part of the society, or even all of it. 

It’s all about choice.  Every downturn gives us the opportunity to determine what America will become.  We weigh our fidelity to our principles, our history, our forefathers — vs. our ability to collectively withstand pain (financial, social, political).  These are collective decisions, because all large-scale economic events have a decisive political component. 

Speculation about the future

Inflation is impractical (for reasons too complex to discuss in this post).  Large-scale defaults would likely lead to a deflationary collapse of our financial system.  The government will not allow that to happen as the consequences would be apocalyptic.  I believe that instead we will socialize the debt, the least-painful and most operationally feasible alternative.

Let us light a candle while we walk, lest we fear what lies ahead

Innovation of new forms of society and technology. It is the key to our progress. It has allowed us to evolve from naked hunter-gatherers to the dominant species on this planet. This process is slow, normally taking hundreds or even thousands of years. But occasionally evolution leaps forward. **

Many people look to the future with fear. We see this fear throughout the web. Right-wing sites describe the imminent end of America: overrun by foreigners, victim of cultural and financial collapse. Left-wing sites describe “die-off” scenarios due to Peak Oil, climate change, and ecological collapse - as the American dream dies from takeover by theocrats and fascists.

Most of this is nonsense, but not the prospect of massive changes in our world. But need we fear the future?

The past should give us confidence when we look ahead. Consider Dodge City in 1877. Bat Masterson is sheriff, maintaining some semblance of law in the Wild West. Life in Dodge is materially only slightly better from that in an English village of a century before. But social and technological evolution has accelerated to a dizzying pace, and Bat cannot imagine what lies ahead.

Is America’s decline inevitable? No.

Comment on a thread at the DNI blog:

“IMHO, the United States is so far down this path that - absent some deus ex machina - its political / economic decline seems to be inevitable and irreversible.  Under these circumstances, our efforts should not be to seek to stem or to reverse this process but rather to seek means to carve out islands of civility and/or excellence notwithstanding general political decay.  Eg. the Spain of Philip IV, with its imperial decline, was nevertheless also the Spain of Velasquez.”

These sentiments are widespread already.  As times darken such views will become more so.  They raise two important issues.  First, why be an American if one has no faith in the American people?  How can you believe in democracy without that faith?  The second concerns the gravity of the threats we face. 

Perhaps as a result of the long summer of America, the post-WWII era of prosperity and peace (relatively speaking), many folks see any serious threat as Armageddon.  But consider our problems vs. those of our European ancestors.  Did they surrender?

Recommended reading: transforming the Army, the hard way

ARMY magazine has posted part two of Donald Vandergriff’s (Major, US Army, retired) article about the Adaptive Leaders Course.  This describes one path to organizational transformation.  The difficult way, building from the foundation up — building something that outlasts all the hot intellectual fads, and can evolve over generations.  The senior Army leadership’s attention to Vandergriff is important good news.

Old Dogs Teaching New Tricks: the Adaptive Leaders Course — Part I, ARMY (November 2007)

Old Dogs Teaching New Tricks: the Adaptive Leaders Course — Part II, ARMY (December 2007)

People, Ideas, and Hardware. “In that order!” the late Col John R. Boyd, USAF, would thunder at his audiences. 

What historical transformations resemble that needed to adapt the US military for an age in which 4GW is the dominate form of war?  The early 19th century Prussian Army experience, of course.  Perhaps the re-casting of the US Army into a French mold during WWI.  Or we can look back to the beginning.  The founders of the American army (Washington, Lafayette, Steuben, et al) built almost from scratch.  They drew on two models…

• frontier militia, fighting against the French and American Indians, 
• conventional European armies, mercenary soldiers with aristocratic officers.

From this they built something quite different.  For a well-written account of this for a general audience, see “Washington & Lafayette” in the September 2007 issue of Smithsonian magazine.  Their experience might hold lessons for us, facing a similar challenge – building an American Army to defend against new enemies, learning new ways to fight in a post-Constitutional era.

For more on these topics

To see Vandergriff’s other works, including links to his many online articles:  The Essential 4GW reading list: Chapter Two, Donald Vandergriff.

To help understand the nature of the Army’s difficulty in retaining its best people, see The Army’s greatest crisis.

For an overview of the various solutions to 4GW, see

• Arrows in the Eagle’s claw — solutions to 4GW, chapter I
• Arrows in the Eagle’s claw — Chapter II, about 4GW analysts

An important thing to remember as we start a New Year

Believe me when I say that we have a difficult time ahead of us.
But if we are to be prepared for it, we must first shed our fear of it.
I stand before you now, truthfully, unafraid.
Because I believe something you do not?
No!
I stand here because I remember.
I remember that I am here not because the path that lies before me, but because of the path that lies behind me.

Morpheus speaking to the people of Zion, from the film The Matrix Reloaded

As we start a New Year I find it useful to review my core beliefs. It is easy to lose sight of those amidst the clatter of daily events. Here is my list:

1. We are a people with a great past.
2. The challenges ahead are no greater than those behind us.
3. The American people can surmount these challenges if we work together.
4. We will be what we wish to be, if we but make the necessary effort.

Articles explaining about the perils before us

• Forecast: Death of the American Constitution
• The post-WWII geopolitical regime is dying: Chapter One.
• The post-WWII geopolitical regime is dying: Chapter Two
• Diagnosing the eagle, chapter I — the housing bust

Articles explaining why we need not be afraid

• A crisis at the beginning of the American experiment
• Washington’s Gift
• Good news: The Singularity is coming (again)
• Some good news (one of the more important posts on this blog)
• Arrows in the Eagle’s claw — solutions to 4GW, chapter I.

A crisis at the beginning of the American experiment

Looking at the problems looming before us, it is easy to forget those of equal or greater danger that we have surmounted in the past.   My previous post, Washington’s Gift, described one such.  Here is another…

As America’s revolutionary war drew to a successful close, many critical problems remained unsolved.  Among them was the pay and pensions due the Army.  Congress seemed unwilling to pass the necessary legislation; the States seemed unwilling to pay.   From Chapter One of FM 1 (one of the Army’s two capstone field manuals):

Following victory at Yorktown in 1781, the Continental Army moved into quarters near Newburgh, New York, to await peace.  The national situation was grim.  The Continental Congress could not raise the funds to provide pay or pensions to the Soldiers, some of whom had not been paid for several years.  Many officers feared that Congress would disband the Army and renege on its promises.  By the winter of 1782-83, tension had reached a dangerous level.  The future of the Republic was in doubt. 

A group of officers determined to use the threat of military action to compel Congress to settle its debts.  They attempted to enlist their commander, General George Washington, to lead the plot.  He refused every appeal, and the rebellious officers prepared to act without him.  On 15 March 1783, Washington entered an officers assembly and warned them of the grave danger inherent in their scheme. He was having little effect until he took a pair of spectacles from his pocket to read. 

Washington’s Gift

I strongly recommend to you this article by the author Thomas Fleming, published today on the Opinion Page of the Wall Street Journal: Washington’s Gift . Here is the opening:

There is a Christmas story at the birth of this country that very few Americans know. It involves a single act by George Washington — his refusal to take absolute power — that affirms our own deepest beliefs about self-government, and still has profound meaning in today’s world. To appreciate its significance, however, we must revisit a dark period at the end of America’s eight-year struggle for independence.

The story begins with Gen. Washington’s arrival in Annapolis, Md., on December 19, 1783. The country was finally at peace — just a few weeks earlier the last British army on American soil had sailed out of New York harbor. But the previous eight months had been a time of terrible turmoil and anguish for General Washington, outwardly always so composed. His army had been discharged and sent home, unpaid, by a bankrupt Congress — without a victory parade or even a statement of thanks for their years of sacrifices and sufferings.

Instead, not a few congressmen and their allies in the press had waged a vitriolic smear campaign against the soldiers — especially the officers, because they supposedly demanded too much money for back pay and pensions. …

Fleming’s latest book is The Perils of Peace: America’s Struggle for Survival After Yorktown.

Other posts on this topic

• Some good news (one of the more important posts on this blog)
• Good news: The Singularity is coming (again)

Some good news (one of the more important posts on this blog)

This blog discusses geo-politics, from an American’s perspective.  Today that means discussing threats and dangers, resulting largely from years of mismanaged public policy.  I do not believe we need fear the future, despite the tough times coming soon.  This remains a great nation, not because of our past but because of us and our polity.  We differ from almost every other nation.  The difference consists of our commitment to our political order, of which our Constitution is the foundation.  In this we are like Athens more than our neighbors, as explained in this excerpt from Allan Bloom’s Closing of the American Mind (the book I most strongly recommend reading):

For the ancients the soul of the city was the regime, the arrangements of and participation in offices, deliberation about the just and the common good, choices about war and peace, the making of laws.  Rational choice on the part of citizens who were statesmen was understood to be the center of its regime.  … Pericles {in his Funeral Oration, as given by Thucydides} says nothing about the gods, or the poetry, history, sculpture or philosophy of which we think.  He praises Athens’ regime and finds beauty in its political achievement…

This is even more true of America, unlike Athens not famous for its philosophy, art, or culture.  The Americans who sat through the long hours of the Lincoln-Douglas debates would, I believe, have understood this.  When this is again true of America we will, I believe, find that the many threats we face no longer seem so dangerous.

It seems we have abandoned this tradition.  To see where this leads, read Christian Meier’s biography Caesar.  He describes how the Roman people grew tired of governing themselves, perhaps finding the burden too great to bear.  Inevitably, strong men came forward to take this load from the people’s backs.  People who will not govern themselves have no right to complain about the decisions of the elites who rule them.

I urge everyone to take action now.  Work for candidates — local, state, national, it does not matter.  All are important.  If you can afford to do so, contribute to a candidate’s election fund.  Write to your local newspapers or on the Internet.  History is being made today.  If we do not make it, others will do so for us.

 There is another element to America’s strength:  our ability to work together.  To see this in action visit your local chapter of the Blue Star Mothers.  They collect money and goods to support our troops, with great success.  At their work days you will see a wide range of people side by side.  Different races and creeds.  Moms and Dads.  Liberals and Conservatives.  Old and young.  Boy Scouts and Hells Angels.  This is America at its best, a nation well able to weather the storms that lie ahead.

For more on this subject

• Forecast: Death of the American Constitution
• The Future of America (skip to forecasts #4 and #5)

Good news: The Singularity is coming (again)

History tends to look better over longer time horizons. For example, consider one bit of good news: the Singularity is coming.

This mathematical concept came to the public’s attention from Vernor Vinge’s book Marooned in Real Time, describing a wondrous future in which the rate of technological progress accelerates - eventually going vertical, after which the humanity leaves for a higher plane of existence (see links below for more on this). Since then it seems that singularities abound in our future, in addition to this technological singularity. Those terrified by the approach of Peak Oil often describe it as a dystopian Singularity; those elated by Peak Oil describe it as a wonderful singularity — a forced purification as we enter a new age. In this post I have described the end of the post-WWII regime as a singularity in a limited sense: we cannot see beyond it (and before worrying about what lies beyond, must first survive the passage through it).

More importantly, singularities are just “been there, done that.” Singularities - or perhaps The Singularity — lie in our past. Consider these awesome accomplishments of our species, each of which radically changed our world.

• discovery of fire (giving us power over the environment),
• agriculture (giving control of our food sources), and
• writing (key to building a knowledge-based society).

Similar discontinuities might lie in our future: