A guest post from Perfect Stranger.
Introduction
Yesterday, I had the pleasure of publishing a guest post from Patrice Ayme about the important subject of Energy Question For The USA
One of the comments on that Post was from Per Kurowski, a former Executive Director of the World Bank. He reported about a letter he wrote that was published in the Financial Times back in April, 2005. That letter set out the case for,
A sensible country would raise tax on petrol, so what is US waiting for?
Sir, it is hard to understand the United States of America! It has a huge fiscal deficit; it has a huge current-account deficit; it is by far the world’s biggest oil consumers both in absolute and in relative terms; now willing to explore for oil and gas in Alaska, it shows itself to be aware of the difficult energy outlook the world faces; it seems aware and resolute about the environmental problems (ignore the Alaska part) as it imposes other expensive environmental regulations, such as recycling—which, as no one likes to do it, requires the hiring of Salvadoreans; it speaks all over the place about having to reduce the vulnerabilities of its oil supplies.
As any other sensible country would, in similar circumstances, increase the taxes on petrol consumption and substantially help to solve all the above-mentioned problems; and as the US has always shown willingness to pull together as a nation, recently even to the extent of going to war on shaky grounds, the big question remains: why is it that the leaders of the US do not even want to talk about a substantial tax on petrol?
The letter struck me as eminently sensible. Then a while later Perfect Stranger emailed an equally valid alternative approach and that now follows as a guest post.
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Many years ago while working for Lehman Bros I did a spreadsheet relating to oil profits based on government taxes, I can assure you that having the USA government (or any other government) raise taxes on oil will do the complete opposite to what everyone expects it will do.
Any taxes raised will only end up in the federal coffers, they will not harm the oil companies because they will simply marginally raise the price of fuel meaning they will still receive the same profits while the government gets even more. The consumers will hurt in the pocket and nothing else will happen.
If for some reason the government found a way to stop the oil companies from any marginal increases then the oil companies would simply raise their fuel transportation costs and lump the entire loss on the Petrol Station operators meaning the operators would lose out, the oil companies would still receive the same profit and the government would still end up with more money in their coffers.
But oil consumption would remain the same, in other words .. raising taxes (or lowering them ) will do no good whatsoever
So the answer to using less fossil fuels, as I keep on saying, is not up to any government nor is it up to the oil companies nor is it up to science, the blame lies entirely on the people who choose to drive to the shops to buy their bread and milk instead of walking whatever short distance that might require.
This is something I have found throughout the entire global warming movement, everybody tends to expect that it is up to governments and science to find solutions when in reality it is we who cause the problems and it is we who should be fixing them … THE GOVERNMENTS CANNOT HELP THOSE WHO WILL NOT HELP THEMSELVES, as long as we keep demanding the same lifestyle they have no choice but to provide us with it.
It is the same with coal, gas and oil in power plants, they only get burnt because we as consumers draw the power from the grid, in other words, we demand it, and if the companies don’t provide enough we get all sorts of blackouts,then we whinge, the companies get fined, directors get jailed for failing in their duty to the public and still .. more coal, gas and oil gets delivered to the power plants.
Spending less Energy and Wasting less Heat is actually the “only” solution that will work, anything else, any other form of debate or discussion on the issue is just another way of extending a debate that should have been over decades ago .. because that is the only possible solution, there really is no other solution, none whatsoever, there are no other answers.
The truth of the matter is that nobody wants to do anything about it except to continue the debate all the while expecting others to resolve the issue while they sit on their butts and talk about how things are going ever so slowly and that it must all be the fault of somebody else.
The oil companies cannot stop producing fuel nor should they be stopped as this would destroy our entire civilization, I am amazed at the ignorance in even discussing such an issue, it’s as if people imagine that by stopping oil and other fossil fuels over, say the next 10 years, that somehow some magical system would suddenly develop to replace them.
Do you realize that it took over a hundred years to build our existing fossil fuel based society and that currently only 3% of that has been replaced by alternative energy sources and that it has taken 3 decades for that to occur, all over the world?
There is no miracle technology that can be implemented fast enough to save us, there never has been, EVER, even nuclear power cannot be produced fast enough for our needs, we have to save ourselves.
So use some common sense and realize that the only possible solution to the global warming issue is for all of us to get into conserving energy and wasting less heat and above all … educating others into doing the same thing.
You leave it too long and we are all going to die ,,,,,, and it’s a guarantee we shall blame some else for it 😦
Footnote: This is a warning given to us by one of the greatest scientists who ever lived, comparable only to both Issac Newton and Albert Einstein.
“Within a finite period of time past, the Earth must have been, and within a finite period of time to come the Earth must again be, unfit for the habitation of man as at present constituted, unless operations have been, or are to be performed, which are IMPOSSIBLE under the laws to which the known operations going on at present in the material world are subject.” – Lord William Kelvin.
As they say, the solutions to the problems of the future may always be found in the lessons of the past. As we can see by Lord Kelvin’s warning, this problem has never had a technical solution and we have little time to learn that one lesson.
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As much as I respect Per’s opinion, indeed I wrote yesterday, “The points you make seem complete common sense.” the argument put forward by Perfect Stranger really does ‘join the dots’ for me and, I suspect, for many others. Indeed, as Wen Scott commented on last Tuesday’s Post,
For my own personal experience, my husband and I have concluded that the only way we can make a contribution is to make our own grass-roots changes. We are solar, heat with wood (carbon neutral), composting toilets and kitchen scraps, and lately are choosing as much local food, goods and services as possible. The Transitions movements are a great example and well worth emulating for all of us.
I think it’s pretty clear that waiting around for governments and big business to solve environmental problems is dangerous to our health and well-being — it’s important to hear voices directly from our scientists, but I think we are very foolish (insane) to refuse to take action now. What are people waiting for, and at this date, does it really make much difference who or what is causing such environmental and climate devastation?
What’s the saying…. walk softly and leave nothing behind but your footprints. Even that may be too little, too late, but let’s hope not.
And it is thanks to Wen’s blogsite that I was linked to the following video,
We are living in exceptional times. Scientists tell us that we have 10 years to change the way we live, avert the depletion of natural resources and the catastrophic evolution of the Earth’s climate.
The stakes are high for us and our children. Everyone should take part in the effort, and HOME has been conceived to take a message of mobilization out to every human being.
For this purpose, HOME needs to be free. A patron, the PPR Group, made this possible. EuropaCorp, the distributor, also pledged not to make any profit because Home is a non-profit film.
HOME has been made for you : share it! And act for the planet.
Yann Arthus-Bertrand
HOME official website
http://www.home-2009.comPPR is proud to support HOME
http://www.ppr.comHOME is a carbon offset movie
http://www.actioncarbone.orgMore information about the Planet
http://www.goodplanet.info
Learning from Dogs 
I agree and disagree with elements of what both Per and Donald say. Neither of them is entirely right or wrong.
I agree with Donald (i.e. Perfect Stranger) that taxes clearly only end up in Government coffers. This is why James Hansen favours his Fee and Dividend system. However, in the short-term, Per is right also, raising tax would have encouraged greater investment in fuel efficiency. The USA is grossly inefficient in its profligate use of energy because financial access to that energy does not reflect the environmental damage its use causes.
People must be given an incentive to modify their behaviour and, as we have learnt with alcohol and all other drugs, prohibition does not work. Where it is known to damage health and/or the environment, drug use must be accepted as being socially unacceptable and irresponsible. This is what must happen to our collective addiction to fossil fuel (i.e. Earth abuse) as well.
We no longer have the luxury of choice. Either we make the necessary choice now or Nature will choose our destiny for us. The collapse of the USSR and the fall of the Berlin Wall over 20 years ago may have bought us some time but, the rapid economic growth of China, India and all other emerging economies (and the legitimate aspirations for self-improvement of people all around the World) means that time has now run out. Civilisation is now at a cross roads. Economic development must be decoupled from environmental degradation; or we will be confronted with what Herman E Daly called uneconomic growth. In fact, I think we are already confronted with it:
In the developed world, our debt-fuelled growth boom is over; and we must now embrace the need to spend our precious money rectifying the environmental consequences of laissez-faire globalised Capitalism. As if to compound the problem, even if we cannot prohibit the use of fossil fuels where little or no choice exists, as well as choosing not to use them ourselves, we must also help the rest of the World to make the right choices where they have or can be given such a luxury: Uneconomic population growth must be controlled in order to enable poor people to escape from poverty.
Unfortunately, none of the above will be achieved unless or until anthropogenic climate disruption is accepted by all – people and politician alike – as a consequence of there being already too many people on the planet.
The words of Lord Kelvin are indeed ominous; as is the much more recent warning from James Hansen that the annual reduction in fossil fuel consumption required to restore the Earth’s energy imbalance by the end of this Century (in order to prevent the extinction of all life on Earth within say 500 years) gets more and more implausible the longer we delay attempting it (i.e. point #7 in my summary of the video of his TED talk embedded here).
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“………..Unfortunately, none of the above will be achieved unless or until anthropogenic climate disruption is accepted by all……… ”
So we need positive proof!!!, how do we get it? obviously whatever we have shown the people so far isn’t working, how do we get our climate scientists to put a better effort into disseminating the message in a layman’s manner … because so far the way they explain it makes sense only to those of us who understand science, those who don’t, have no chance whatsoever 😦
We need to find a methodology that works on the people, obviously those of us who already understand the dangers have no need of further proof but others do.
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Although they have not always been so, I think our climate scientists are getting quite good at explaining the situation. Necessity has been the mother of invention. Unfortunately, we are only now realising it was a surrogate pregnancy and the real mother was Frustration. Furthermore, the baby has now been snatched from ICU by Desparation; and both are now being pursued by the Fossil Fuel Lobby’s thought police….
As the denialist reaction to Horizon‘s ‘Global Weirding’ programme demonstrates, even when people are given a very clear message, many seem incapable of taking it on board. Therefore, I think it will require an intravenous injection of some kind of truth-perception serum: Basically, I think we need to inject them with holistically intelligent valuation of anthropogenic induced devastation synopsis (HIV-AIDS)…
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Personally I have no wish to leave it up to others anymore, they had their chance at spreading the message and failed miserably for 40 years, I intend to act, don’t know how but I’m sure that I’m smart enough to come up with something … words don’t appear to work so I’m considering some kind of kinestetic/visulisation method, I have some thoughts on the matter but I’m only just now warming up to the idea of doing something special by myself.
For Christ sake, I helped to save the Franklin, this one should be easier, there are no Aussies against me this time, you know how tough my uncultured brothers can be. 🙂
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What a delight it is to wake up, turn on a tablet (a Kindle Fire in this instance) and see a healthy discussion flowing from a Post. Thank you both for your contributions.
If I were to choose to settle either side of the line of Government vs Self, I am bound to say that ‘Self’ would be my choice.
Indeed, I am drawn to a rewrite of those famous words from John Kennedy in 1961. I would rewrite, “And so, my fellow Americans: ask not what your country can do for you – ask what you can do for your country.” to the following:
“And so, my fellow inhabitants of this world: ask not what your planet can do for you – ask what you can do for your planet.“
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Sometimes it pays to step outside the circle and look at other problems and how they were solved
http://www.cio.com.au/article/420036/what_went_wrong_hubble_space_telescope_what_managers_can_learn_from_it_/?
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Oh, that looks good! Must be a Post in there somewhere! You or me? 😉
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Go for it, I’m already too busy working out a “plot” I shan’t be blogging for a few days, when I feel like this I usually just stare at wall and think .. think and then think some more 🙂
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And you know…., the more I read the article in the link the more I realize that the whole problem with Hubble was because of the pressure put on the guys who built it, in the same manner one can see the pressure on the climate scientists trying to explain global warming and one can find that pressure by reading the climategate emails … there is hardly any difference between the resolution of both problems 🙂
I mean .. check this out for the hubble problem and then transpose it to the climate scientists and how they feel when explaining their findings
“”So the way it works is you tend to blame the people doing the work,” Pellerin says. “So we’re hammering on them, hammering on them so they had no free time or no inclination to track down anything that wasn’t a critical problem because we have other critical problems. Difficult technical things that we couldn’t solve yet. ………. The review board also found that a hostile environment had been created for the contractor (read climate scientist) , which meant “they told us about any problem at their peril,” Pellerin says.”
Things get easier once the problem is pinpointed 🙂
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I can see the parallels but only so far. Where I think they depart is, and I’m presuming here, I don’t know, that with Hubble there wasn’t the same complicated relationship between oil, money and politics.
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I’m honestly not sure but I would imagine that if we removed the word “oil” and replaced it with “lockheed” or other such names of technology/space industry companies then the result would be the same.
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To Perfect Stranger:
I do not want to wax lyrical about spreadsheets at Lehman Brothers… I guess, after imploding world finance in 2008, lehman could now write a spreadsheet to implode the biosphere… Who is the biosphere’s Fed?
Does the right honorable perfect stranger gentleman really believes that dozens of governments around the world are so stupid about rising taxes to tweak the market to efficiency?
Does the right honorable perfect stranger gentleman really believes that if I put a $100 dollar tax per gallon on gasoline, people would still drive?
As I have argued, the subprime bust was ignited by the oil rise. we have another now, another recession will insue, if prices go above those of 2007.
American capitalists, like all capitalists, throughout history, play in the free market arena as defined by their government, and the environment. In that sense, there is no free market, as Genghis Khan demonstrated.
PA
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Ooh yeah, I always did say that the global financial problems were most likely because of that coma I placed in the wrong place in my debenture spreadsheet … but I swear, it was a tad small mistake, it only cost 10 trillion dollars .. nothing to worry about … you guys will make it up, I’m sure ..JUST INCREASE MORE TAXES ON THE POOR PEOPLE OF THIS WORLD. 😦
I already mentioned a couple of ways by how extra taxes wouldn’t hurt the oil companies (and there are plenty more) but I wonder if you realize what damage such stuff would do to the people and to the economy.
It’s as if you think that in the western nations where most people go to work by car that it doesn’t matter if they then end up with no bread or milk on the table for their children or if like my neighbours across the road, (who both work like dogs) they can’t even afford to pay the electricity … all because of taxes.
Raising the fuel taxes to such heights, as you say, in countries where the automobile is the sole means by which people keep their jobs is not only ludicrous, it is financial suicide … They would have to pay so much in fuel to get to work that at the end of the week they’d be left with nothing; give them buses and other forms of making it to work first and then yes, it might work then,… but otherwise it is the dream of fools. And don’t forget, you’d have to change the transportation system for some 179 million workers, not just a few, and that’s just in America, what about the rest of the western world?
And then add to that what such taxes would do to the independent operators in the transport industry, truck drivers and all that .. they already live on small enough profit margins, more taxes would send them bust … the larger transport companies would have no choice but to increase their prices and before you know it a banana in supermarket would be just as expensive as a bar of gold!
And then there is the fact that even if you had a good enough transport system, raising fuel taxes to such heights would also mean an increase in fees which again would hurt those at the lower scales of income, and it would hurt them pretty bad.
Have you not considered that oil is the beginning of the economy? any increases on its costs has repercussions across the entire economic sector.
(do I get to keep my honour now?)
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Dear PS: Thanks for your answer. I understand and know all you say. I just pointed out that if gas was expensive enough (from tax) oil companies would not sell any.
It will be clear within 3 years that we are running out of gasoline. It’s already clear; just look at the graphs in my essay. The transition will mean a continual depression in the USA.
BTW, Germany and Japan are twice more efficient per GDP CO2 wise, France three times. Of the large economies, the USA is by far the less efficient. So time to go to work. (California is doing a good, but belated, effort.) As I explained on my site, it’s due to the exploitative mentality in common with Australia and Canada. (Australia is also doing an effort, but just started.)
You keep your honor, if you promise to study my site in depth.
;-)!
http://patriceayme.wordpress.com/
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To be quite honest, Australia is not making any kind of an effort, what our government appears to relinquish in one side of the economy they get back (40%) from selling so much coal to china and India that soon it will dwarf all other coal imports into these two nations, we sell them so much and so cheaply that if I remember correctly (not too sure though) we power some 60% of their coal power plants.
Even now we are developing the world’s two largest fossil fuel projects, one in the west ..gas .. and one in the east, in Queensland, where … believe it or not they intend to use the great barrier reef as a highway for super-ships to carry even more coal to China.
As a matter of fact we are the only country in the world with a dual economy, one for our population and one designed specifically to feed the world all our resources .. (about 2% of our land) in order to keep their societies going, we don’t need it, we are only 23 million but have enough resources to feed resources to some some 20 billion people .. honestly we do… we have so many gold mines we don’t open any more because it would drop the price of gold, diamonds and emeralds by the mountain full, enough iron ore to cover all of Britain with it and so on and we even have untapped oil deposits we choose never to touch and in the north-west .. 40,000 years worth of fresh drinkable water underground. Truth is we have it all, we are indeed the lucky country.
We have destroyed the Papuan’s land by exploiting it for gold and other minerals, recently we had an oil sleek in the Indian Ocean so massive it compared to the one in the gulf not long ago but we managed to keep it real quiet, only a few fishing communities starved to death …pheww! ; and …. get this … we have destroyed so many islands with our mining activities that we had to move their entire populations to our mainland because they can’t live at home any more… and we’re still at it … non stop.
I guess you could say we are masters at destroying the environment … we saved an old forest from being flooded once though ….. but then after we all left and went home … they started wood-chipping the entire area.
So no, to be honest, environmentally speaking the only thing we care about over here is a cool beer, otherwise I doubt we’d be fighting global warming, truth is we are too far removed from the rest of the world to give a hoot and considering we live in one of the most arid and dangerous places in the world we only see you guys as finally catching up to our lifestyle when it comes to AGW…. It’s a tough land, Australia. 😦
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There is grotesque propaganda by the oil plutocrats in the USA that stuffing the atmosphere and ocean exponentially with all sorts of greenhouse poisons does not matter. Most Americans are not inclined to disagree with their masters, so they approve with the drunken enthusiasm of those inclined to please the mighty.
Their naivety knows no bounds. And the proof? They have been told there was no proof that going from 280 ppm CO2 to 460 ppm CO2 equivalent gases could not possibly be a problem. Just don’t eat fish: it’s full of mercury from coal burning.
The truth? American defense establishment branches have climate change departments, and have warned “climate change” is a security threat to the USA. CIA, Pentagon, name it, they talk not just about climate change, but about the coming wars it will bring. “Climate change” is obviously the greatest security threat.
So I woud dare to propose that CO2 deniers are actually traitors to the fatherland, not just dim witted parrots trained by greedy plutocrats.
PA
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It’s as if you think the whole world is made up of Kamikaze citizens willing to give their lives for the sake of the world, getting rid of CO2 is a necessity but so is living in the world we created and which cannot easily be changed by adding or removing a few dollars here and there.
You lead the way and the rest of us will follow, stop driving your car, stop using electricity, stop expecting the supermarkets to keep the refrigerators working, stop expecting the butcher to do the same, stop demanding that movies houses, restaurants, shopping centers, councils, and so on keep their lights on at night so we can see what we’re doing, stop using you television, your dvd, satellite box, turn off all the pumps that feed water into your home, close down the entire sewage system, give up air conditioning, radio, mobile phone chargers and I could fill pages with more stuff.
Either that or come up with a sensible solution to removing fossil fuels in a short period of time while at the same time keeping the world not just alive but with a coherent society
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The French are not living differently from the Americans, with a third the CO2 emissions. Why? They pay $10.50 a gallon for gasoline. The difference is all tax. By next year, the EU will be taxing jet fuel, BTW. The rest of the world is not.
Also it;s standard in France to build triple pane windows in new buildings and the latest building codes are stringent, close to 0% thermal loss. Oh, yes France is building more new housing than the USA, i knew you wanted to know.
PA
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“THE GOVERNMENTS CANNOT HELP THOSE WHO WILL NOT HELP THEMSELVES”
The problem with shouting a message like this is that it suggests that all government is bad (if not evil), and helps the cause of those who would argue that smaller government is better. The conclusion that ‘individuals must choose’ is far too simplistic.
The truth, as always, is more complex.
I was in America once. I parked in a parking lot, and needed to visit two places nearby. One place was on one side, the other on the other, of a very busy main road with several lanes of heavy traffic in both directions. I made a deliberate effort to walk to the second place (on the other side of the road) but in the end I had to give this up as there was simply no place to cross the road. Whoever had designed this neck of the woods had assumed that the local populace moved on wheels, not on legs. I had no option but to get back into the car and drive to the second place.
One cannot unilaterally decide to give up using a car (for instance) to get to work (for instance) if there is no viable alternative.
Viable alternatives (such as public transport) can only be put in place by organising the environment.
Organisation of the environment can only be accomplished by government.
Smaller government means less organisation — at a time when we need more.
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Crickey, Pendantry! Did you not think of throwing a brick through the windscreen of an incoming car then crossing the road after the accident caused all traffic to stop? Where’s you initiative my man! And think of the money you could have made by video taping the accident and then selling it to the news channels. 🙂
Joke aside, no, I did not mean to imply that government is bad, I meant that governments are duty bound to yield to the demands of the people, as long as the demand is there governments have no choice but to provide or societies crumble.
But yeah, truth is truth, the western world is too dependent on the car industry, one step forward would be to provide better and more eco-friendly alternatives but then that would kill Kennedy’s dream of a “Free and Independent people”
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Pedantry is right. I had the same experience many times. In the USA, it’s much more frequent, than, say, in France. (But it does also happen in France, in places without sidewalks.) For example the Bay Area spent billions, and 20 years rebuilding the Bay Bridge, but they did not put a sidewalk or bike lane on it. Whereas the Golden Gate bridge has two… and is the only bridge there equipped for humans!
PA
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Gentlemen, thank you all so much for the quality of your comments, and for your commitment in spending the time writing them up. It does this old soul a very big favour, and I have no doubt that many other readers of this Blog will gain as much from reflecting on your thoughts as I did. Paul
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Have sent you all a parcel, each one contains … 1 White Pointer Shark, 1 funnel web spider, 1 red back spider and a flesh eating White Tip, 1 tiger snake, 1 red belly snake, a brown snake and a Taipan, a stone fish, 2 giant man o’ wars and a box of Irukandji jellyfish, three bags of bush-fire, a sample of BullDust from the Simpson desert and a carton of the best CO2 producing coal in the country .. Now you can all feel like Aussies, I would have sent you a piece of our Prime Minster but I couldn’t catch the bloody ostrich! 🙂
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🙂 You and Patrice have had quite a debate!
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Oui, oui, maintenant je parle français et il a appris comment parler l’aborigène de tribu de comadichi 🙂
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I just saw the excellent description of Australian ways by PerfectStranger. To tell the full truth, I was putting a positive spin on PM Gillard… a lady, BTW…
I have, in previous writing expressed the opinion that the USA, Canada and Australia inherited their common philosophy from the plutocratic “West Country Men”… And it shows up in their CO2 excretion numbers…
PA
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Wow! What Dialogue here… 🙂 If people are not Joining the Dots by now they never will……. this world as I keep saying is in for some tough times ahead, both in its economy and its environment. So for those who haven’t as yet Joined the Dots, I suggest they pick up their Pen.
Regards ~Sue
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And if you want the most powerful reasons for joining the dots pronto, do watch that HOME film! Chilling!
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Yes the future is a chilling prospect..
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