Science

Peak Everything

Forget peak oil. What about peak lithium, peak neodymium, and peak phosphorous?

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When you really need something, it's natural to worry about running out of it. Peak oil, the notion that global petroleum production will top out and then begin to decline permanently, has been a global preoccupation since the 1970s, and the warnings get louder with each passing year. Environmentalists want to put limits on the consumption of fossil fuels, but they haven't been very successful in encouraging people to consume less energy, even with the force of law at their backs.

But maybe they're going about it all wrong, looking for solutions in the wrong places. Lucas Bretschger, an economist at the Swiss Federal Institute of Technology, and Sjak Smulders, an economist at Tillburg University, argue that we shouldn't focus directly on preserving the resources we already have. In a 2003 article for the Italian think tank Fondazione Eni Enrico Mattei, they instead ask, "Is it realistic to predict that knowledge accumulation is so powerful as to outweigh the physical limits of physical capital services and the limited substitution possibilities for natural resources?" In other words, can increases in scientific knowledge and technological innovation overcome any limitations on economic growth imposed by the depletion of nonrenewable resources?

The debate over peak oil is heavily politicized, so let's set it aside and test the idea of imminent resource peaks and their consequences for economic growth on three other nonrenewable resources: lithium, neodymium, and phosphorus.

Peak lithium. Lithium is the element at the heart of the electric car revolution that green energy enthusiasts are trying so hard to foment. For example, the Chevy Volt, scheduled to be at dealers this fall, will be energized by 400 pounds of lithium-ion batteries, plus a gasoline engine to produce electricity to extend the car's range of travel once the batteries are drained.

In 2007 William Tahil, an analyst with the France-based consultancy Meridian International Research, issued a report that concluded there is "insufficient economically recoverable lithium available in the Earth's crust to sustain electric vehicle manufacture in the volumes required." Tahil added, "Depletion rates would exceed current oil depletion rates and switch dependency from one diminishing resource to another."

Not everyone agrees with Tahil's peak lithium prognostications. Geologist R. Keith Evans, who has long been involved in the lithium industry, issued a rebuttal arguing that lithium resources are much higher than estimated by Tahil. Evans also asserts that as prices rise other sources of lithium will become economical. And lithium prices have indeed been increasing. But for the sake of argument, let's assume we are "running out" of lithium. Then what?

Even Tahil's original report noted that there were alternative battery technologies in the works, approaches to use more common substances instead of lithium. The Swiss company ReVolt Technology, for example, is developing rechargeable zinc-air batteries that hold four times as much charge as lithium-ion batteries and cost half as much. Fluidic Energy a tech startup in Arizona, claims it can develop a metal-air battery that will hold 11 times the charge of the best lithium-ion batteries for less than a third of the cost. A car running on such batteries would have a range of 400 to 500 miles on a single charge. In addition to being far more available, the materials could be fairly easily recycled.

Peak neodymium. Neodymium is a rare-earth metal used extensively to produce permanent magnets found in everything from computer magnetic disk drives and cell phones to wind turbines and automobiles. The magnets that drive a Prius hybrid's electric motor use more than two pounds of neodymium. Neodymium magnets were invented in the 1980s in response to the global cobalt supply shock that occurred as a result of internal warfare in Zaire. Because China can produce the material more cheaply than any other country in the world, that nation is now the source of 95 percent of the world's neodymium. China's government recently warned that it would begin restricting exports of neodymium and other rare-earth metals to ensure supplies for its own manufacturers.

In March, Rep. Mike Coffman (R-Colo.) introduced the Rare Earth Supply-Chain Technology and Resource Transformation (RESTART) Act of 2010. The RESTART Act would offer federal loan guarantees to mining and refining companies to recreate in five years a domestic rare-earth minerals industry, achieving a kind of rare-earth minerals independence.

But there are alternatives to industrial policy. If neodymium supplies really are a problem, there may be a technical fix. For example, Chorus Motors has invented and developed an improved AC induction motor that supplies the energy needed to accelerate hybrid or electric vehicles without neodymium magnets. If this technology is widely adopted, it would free up neodymium supplies for other uses and reduce the metal's price.

Peak phosphorus. In the 1840s, scientists discovered that plants need the element phosphorus to grow. The phosphorus fertilizer industry grew rapidly, at first by exploiting vast deposits of seabird guano left on oceanic islands. Today phosphate rocks are mined to produce the fertilizer, which is essential to modern agriculture. According to Global Phosphorus Research Initiative (GPRI), a collaboration between independent research institutes in Europe, Australia, and North America, known phosphorus reserves could be depleted within the next 50 to 100 years. The April 2010 issue of Foreign Policy ominously warned that failing to meet the challenge of "peak phosphorus" would mean that "humanity faces a Malthusian trap of widespread famine on a scale that we have not yet experienced."

But unlike petroleum or natural gas, phosphorus, an element, is not destroyed when it's used. So it could be recovered and recycled. The GPRI points out that the phosphorus in just one person's urine would be close to the amount needed to fertilize the food supply for one person. So why not recycle urine?

NoMix toilets keep urine separate from solid wastes, allowing phosphorus and nitrogen to be recovered and used as fertilizer. Furthermore, biotechnologists are exploring ways to dramatically increase the efficiency with which crops use phosphorus, which would reduce the amount of fertilizer needed to grow a given amount of food.

"Every generation has perceived the limits to growth that finite resources and undesirable side effects would pose if no new recipes or ideas were discovered," the Stanford economist Paul Romer writes in The Concise Encyclopedia of Economics. "And every generation has underestimated the potential for finding new recipes and ideas. We consistently fail to grasp how many ideas remain to be discovered. The difficulty is the same one we have with compounding: possibilities do not merely add up; they multiply." The production of some physical resources may peak, but there is no sign that human creativity is about to do anything of the kind.

Science Correspondent Ronald Bailey (rbailey@reason.com) is the author of Liberation Biology: The Scientific and Moral Case for the Biotech Revolution (Prometheus).

NEXT: From the Why-I'm-Turning-Libertarian Files

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  1. Let’s say your living was made on resource x. And you noticed that there was a limited amount of it and if you kept using it at your current rate you would deplete it at time y (a time before your relaxing retirement). Wouldn’t you, I don’t know, start using less of it? What kind of Pollyana would you have to be to keep on using at the current rate all the while proclaiming “they’ll invent a substitute, I just know it, I know it!”

    Maybe uber-evangelicals have that kind of faith, but come one…

    1. According to libertarian logic, it is perfectly ok to play Russian roulette, because the market will surely invent a solution to your “bullet speeding towards brain” problem if the wrong chamber spins into position.

      1. Agreed. I think markets are magical too, but I mean that metaphorically. As is often the case it’s the literalists that concern me…

        1. Look, it’s a 69.

          1. No, 69ing is good. Chad and MNG’s comments — not so much so.

      2. Re: Chad,

        According to libertarian logic, it is perfectly ok to play Russian roulette[..]

        Hey, child-like, leave this conversation to us adults, and have your child-like conversation with the other children.

      3. Prove me wrong!

      4. As long as we’re talking about Russian Roulette, why don’t we talk about how deficit spending is the government essentially gambling that the American people will somehow how have enough wealth in the future to pay off massive amounts of debt?

        So what happens if the markets keep sloping downward and never recover?

        Not to mention it’s shooting ourselves in the foot and enslaving our children…

        1. “As long as we’re talking about Russian Roulette, why don’t we talk about how deficit spending is the government essentially gambling that the American people will somehow how have enough wealth in the future to pay off massive amounts of debt?

          So what happens if the markets keep sloping downward and never recover?

          Not to mention it’s shooting ourselves in the foot and enslaving our children

          agreed. Reckless spending of financial resources is bad. Also reckless waste of econological resources is bad.

          Waiting for the price to shoot up high enough to put the economy in the dirt isn’t always the best idea. See for example $150 oil.

      5. According to libertarian logic, it is perfectly ok to play Russian roulette, because the market will surely invent a solution to your “bullet speeding towards brain” problem if the wrong chamber spins into position

        Is this self parody Chad?

        According to economics as the supply of a finite resource is used up, the cost will increase, making alternatives comparatively economical.

        What is the alternative?

        Ration coupons where Chad gets to decide who can use what?

        1. “Ration coupons where Chad gets to decide who can use what?”

          You just gave Chad a boner.

        2. “According to economics as the supply of a finite resource is used up, the cost will increase, making alternatives comparatively economical.”

          I can think of a notable exception to this rule.

          More than a few large settlements were abandoned in history when local water sources dried up. Water obviously does not have any alternative.

          It is probably significant that every desert-inhabiting culture treats water sources as almost holy and limits/rations their use by various taboos of non-economical character. This may be the only long-term strategy that works.

          1. Marian Kechlibar|8.20.10 @ 6:32PM|#
            “More than a few large settlements were abandoned in history when local water sources dried up. Water obviously does not have any alternative.”

            Yep, when all trade is local, local shortages can be a problem.
            So?

          2. More than a few large settlements were abandoned in history when local water sources dried up. Water obviously does not have any alternative.

            True,

            However, water, oxygen and sunlight are the only non replaceable things required for human life.

            The utility of oil is most certainly is replaceable.

          3. Yes, there is no substitute for water. However, we live on a planet whose surface is 70% water and of course in places it is miles deep. Plus the GW is causing all of the icecaps and glaciers to melt, remember??

            Desalination of seawater is getting easier and easier. You can do it by heating water which you can do with heat from the sun. And now-a-days you can also use membrane filtration technology which can be powered by a mule turning a crank if necessary. Plus while we are recycling urine for phosphorous and nitrogen, just grab the water as well. If you live near the sea or can pipe water inland you can have water, it will just be more expensive. Now, of course we have soft drink manufacturers shipping water all over the world just as we do grain. Of course there will always be places where it is too dry and it will not be economically feasible to ship in water for agriculture or it just makes life too hard and that community will have to relocate. No way around that except government subsidies, which as we know cost nothing and are really the best way to do everything.

            If the government does it, all the wise experts can plan everything and there will never be any shortages or waste. This is really the more realistic view. Anyone who thinks more deeply than this and has the mind to think of options and alternatives is actually a simpleton, right CHO-MNGY?

          4. Here you go chief:

            http://www.desalination.biz/ne…..;channel=0

      6. According to Chad logic, any course of human action aimed toward the goal of avoiding death by starvation, dehydration or exposure is too dangerous to pursue. His safest option would be to handcuff himself to a tree and let nature take its course. Ya know…for society.

    2. MNG, do you not comprehend the concept of “price signals”?

      Or the concept of “currently discovered reserves reflect the level of those natural resources it makes economic sense to discover, and when some of those supplies are depleted, price signals will lead to more exploration and more of that resource being discovered”

      You’re a liberal because you’re an economic ignoramus. Sorry, but it had to be said.

      1. Uh, yeah, I get how prices work and spur supply prole, but there is an end to how much supply of a limited resource can be achieved.

        1. there is an end to how much supply of a limited resource can be achieved.

          In effect, there is not. There are limited supplies of sand, in the sense that the entire universe is not composed entirely of sand and the universe is possibly not infinitely big, but that doesn’t mean that there isn’t enough sand to go around to satisfy human uses.

          You did not comprehend the article. You can go out and buy supertankers full of oil if you want. If the entire stock of known reserves of oil gets completely depleted, more will be discovered, albeit at higher prices. And at high enough prices, alternative sources of energy, such as superabundant coal, will be used as a replacement.

          Dammit, how hard is it to grasp this basic economic principle?

          1. “Dammit, how hard is it to grasp this basic economic principle?”

            To someone who believes that people must be controlled, that the average individual is clay to be molded by social engineers, the idea that people will change their behavior without someone pointing a gun at their head is ludicrous.

          2. Sigh.

            Yes the growing scarcity of an item in demand will force prices to go up and those prices going up will attract more efforts at supplying that demand. But there is a limit: even at very high prices oil cannot be conjured out of thin air and when that limit is reached we will be out.

            Yes we can switch to another source, but we’ll also have this entire infrastructure built for oil sitting around too. It’s in our interest to start thinking about being ahead, not behind, the curve on this.

            1. “even at very high prices oil cannot be conjured out of thin air and when that limit is reached we will be out.”

              Actually, it can be, both hydrogen and carbon exist in the air, you could even use plants to do it if you wanted to.

              “Yes we can switch to another source, but we’ll also have this entire infrastructure built for oil sitting around too. It’s in our interest to start thinking about being ahead, not behind, the curve on this.”

              Agreed! Thats why markets are so important, they are forward looking on longer timescales than politicians are.

              1. Agreed! Thats why markets are so important, they are forward looking on longer timescales than politicians are.

                I don’t know about that. They could put together a five year plan or something….

              2. “Agreed! Thats why markets are so important, they are forward looking on longer timescales than politicians are.”

                Bullshit

                It’s just been proven that markets are VERY short sighted. Look at the housing crisis. Companies were concnered about quarterly earnings NOT long term financial stabliity.

                Again look at BP, they were so focused on short term profit it ended up costing them MANY time more in the long term with the spill.

                If even Greenspan can admit that markets aren’t perfect, surely you can as well.

                1. “Bullshit” was a very good title for your little essay Kroneborge.

                  “It’s just been proven that markets are VERY short sighted. Look at the housing crisis.”

                  Government meddling leaves no option but to be short-sighted. Housing is one of the most regulated(therefore constantly distorted) markets. Short of bribing politicians to distort it in your favor, you cannot plan for the long term. All you can do is exploit each immediate situation until the govt says “We’re not gonna change anything else” and you believe them.

                  “Again look at BP, they were so focused on short term profit it ended up costing them MANY time more in the long term with the spill.”

                  British Petroleum changed their name to “Beyond Petroleum” because they were trying to go green in the long term. They took their eye off the short term ball because they didn’t want to stay in the oil biz for much longer. Their urgency in trying to get out of the oil biz probably also had a lot to do with govt meddling.

                  “If even Greenspan can admit that markets aren’t perfect, surely you can as well.”

                  How this made headlines, I have no idea! Why would you think any Fed Chairman would ever believe markets are perfect when his job is to correct perceived flaws in them. The Fed itself presupposes flawed markets.

                  1. Yes their was plenty of government meddling, but there was also plenty of business short sightedness.

                    Are you really not aware of how much companies have been focusing on quarterly earnings to the determinent of long term perforamance? It’s all about the bonus here and now.

                    That is one of the chief motivators behind all the crappy mortgages. Who cares if they blow up later, I got my bonus now.

                    Are you really telling me that it was impossible for banks to make sure that a customer could pay back the loan before giving it to them, REALLY?

                    As for BP, they were cutting corners in their OIL business to improve thier short term bottom line, it had nothing to do with going green.

                    As for Greenspan, yes he was in favor of interest rate manipulation, but he was counting on market forces and compeittion to prevent the bad acting that occured with the housing crisis.

                    But guess what, people can act very short sighted, EVEN when the market is present. This has been shown throughout history.

                    It’s important to have the right incentive structure, and rules in place to encourage proper market behavior.

                    1. 1.I know. When there’s a lot of fire there will be a lot of smoke.

                      2.They should be allowed to fail. They bet on a bialout and it was a smart bet.

                      3.Without government intervention, how could someone possibly benefit from loaning money to people who you know will default? They bet on a bailout and it was a wise bet.

                      4.I’m telling you that they had no incentive to do so. In fact, the explicit goal of Fannie and Freddie is to incentivize the opposite.

                      5.Yeah huh! Did to! Compare their safety records to those of Shell, Texaco or any other oil company in this country. Violations were single digits rather than BPs triple digits. Don’t these companies like profit too?

                      6.That’s not a free market. That’s a centrally planned market.

                      7.Such people are called politicians.

                      8.What is proper market behavior?

                    2. Kroneborge|8.20.10 @ 5:59PM|#
                      “Yes their was plenty of government meddling, but there was also plenty of business short sightedness.”

                      Uh, you sort of made the point there. When the government fucks up the market, the market gets fucked up.
                      But I’ll bet the obvious solution doesn’t quite ring your bell, does it?

                2. Problems:

                  – Greenspan was head of the Federal Reserve, so of course he’s not one who supports the market in a key aspect: the value of money. He was only incapable of casting his eyes at himself to see that the “flaw” in the free market system he should have seen was himself (Also the fact that he passed some key regulations that encouraged banks to hold dangerous mortgage-backed securities disproportionately)

                  – BP incorrectly thought that any spill would only cost them $75 million, which was the cap the government placed on any disaster happening. With free disaster insurance provided by the American taxpayer, the cost-benefit analysis sloped towards taking less precautions.

                  Both those scenarios involve the government doing things it shouldn’t. So, given that your argument attacks the free market with arguments that rest on violations of the free market, I call:

                  Bullshit.

            2. “It’s in our interest to start thinking about being ahead, not behind, the curve on this.”

              What about those who will not go along with this wonderfully progressive idea?

              What do you want to do with them?

              Tax ’em? Lock ’em up? Shoot ’em?

            3. Yes [private owners of infrastructure] can switch to another source, but [they’ll] also have this entire infrastructure built for oil sitting around too. It’s in [their] interest to start thinking about being ahead, not behind, the curve on this. [Which is why it’s imprudent to try and interfere with profit-maximizing owners of natural resources.]

              FTFY

              1. Why do you hate Particle Man?

            4. “It’s in our interest to start thinking about being ahead, not behind, the curve on this” (emphasis added)

              I got news for you, dog boy, people started thinking about this decades ago. Ever hear of EPRI, NREL, etc.?

              Jesus what a moron.

              1. NREL probably isn’t the best example of market forces at work considering that it’s a DoE funded organization.

                1. Reagardless, the point is that there are already people thinking about it.

            5. Re: MNG,

              But there is a limit: even at very high prices oil cannot be conjured out of thin air and when that limit is reached we will be out.

              And lo and behold, humanity switched from whale oil to ground oil . . . and when that time comes, MNG, humanity will switch to something else.

              Your preoccupation with these resources and conservation is interesting, but only in the psychological sense. In the economic sense, it shows your incapacity to think in marginalist terms. Only people call resources: “Resources”, which means that a “resource” is in the eye of the beholder. Today it’s oil, tomorrow, who knows? But this “conservasionist” preoccupation is futile, and I am being kind.

              Yes we can switch to another source, but we’ll also have this entire infrastructure built for oil sitting around too.

              At one point there was this HUGE infrastructure built around horse-pulled buggies. The world came to a sudden end the day the self-propelled car came into being . . . or not.

              It’s in our interest to start thinking about being ahead, not behind, the curve on this.

              You mean, “conservationism”? It’s an exercise in futility.

              1. OM you are arguing for nothing but delaying and exponentially increasing costs. There are many many historical examples of resource crises; wars are fought over them. You want to risk chaos, either from market worship or fatalism, neither of which is useful.

                1. Tony|8.20.10 @ 7:47PM|#
                  “OM you are arguing for nothing but delaying and exponentially increasing costs…”
                  Hey, tony, got that strawman on the ropes, do you?

                  “There are many many historical examples of resource crises; wars are fought over them.”
                  There are many, many historical examples of central planning causing wars. Mostly against their own populations,

                  “You want to risk chaos, either from market worship or fatalism, neither of which is useful.”
                  You want to risk the starvation deaths of millions from your ignorance? Not very useful.
                  Asshole.

                  1. You are the one risking massive death. My concern is maintaining as much of the lifestyle status quo as possible for human beings. Your concern is sticking your fingers in your ear, saying lalalala, and calling people names.

                    1. Also, I don’t think anyone here is concerned with sticking our fingers in our ears. Believe it or not, just because one doesn’t automatically subscribe to notions such as carbon taxation, it doesn’t follow that they are not concerned about the environment. There is a whole chain of argumentation which must be made to go from the premise “global warming is happening” to the conclusion “we should institute carbon taxes”. I’ve never seen this argument made and believe that any attempt to do so would be laughably weak.

                      Simply because we oppose things like cap and trade doesn’t mean that we’re sticking our fingers in our ears. Some of us believe that governments fuck up just about anything they puts their hands upon and that any attempt to avert global disaster is just another thing for them to fuck up.

                2. Actually, Tony, you and Chad seem to be the ones arguing for higher costs. You argue that government funding should be used to conjure new technologies out of thin air. This is incredibly expensive precisely because a large enough scientific background for these technologies does not exist. It will be established over time and in such time the infrastructure will be built up to allow for green technologies to compete with their traditional counterparts. But it can’t be imposed by government fiat.

                  Imagine that we had run into a paper shortage in 1940. A bunch of politically connected people decide that this is likely to doom mankind and propose that we recycle words…the basic idea behind a computer text. Could the government have brought about the personal computer then? Probably not. The obvious investment would have been in things like thermionic tube technologies. Yet, the technology which brought about the computer revolution, the electronic transistor, was not in existence. The breadth of scientific knowledge pertaining to this subject was not large enough to allow for the inception of this technology. And no amount of government funding would have changed this basic fact.

                  This isn’t to say that government money can’t accomplish technological change. Our understanding of nuclear physics certainly wouldn’t be anywhere near as advanced as it currently is without the Manhattan Project. The point is that this is an incredibly expensive endeavor.

            6. It’s in our interest to start thinking about being ahead, not behind, the curve on this.

              Are not many people, such as this organization, doing so? Doesn’t the article itself emphasize this? It seems to me that such ingenuity as described is already bearing fruit

          3. What does that have to do with the oil industry though? The oil industry is over 90% government-owned. The subsidizing of oil started a long time ago with backroom deals between Standard Oil and government-built railroads. BP was a public company until the 90’s. Oil companies and the entire oil-based energy system has nothing to do with capitalism or free market principles. It is based on socialist principles. When there’s a limited resource then get the politician in your commie central government, whether a dem or repub, to start bombing a country that has the resource you need. That’s how the system has worked for 100 years. BP is a perfect example. 100% government-owned, a complete failure in the free market a century ago until Churchill convinced the government to buy it and then supported with interventionist actions like Operation Ajax. Forget trying to apply free market principles to figuring out how the oil industry works, you do better to make comparisons to how other socialist programs work.

          4. Prolefeed, I’m not sure that either you or the author of this article understand finite.

            We know that increasing price (perhaps brought on by scarcity) will bring forth attempts to find more reserves, which are economical at the increased price. And so on, until either the price is too high for too many people, thus depressing demand and lowering the price, making the new reserve uneconomical again, or, in the case of energy, the energy cost in producing the reserve equals the energy obtained. In the first case, we’ve already seen that with oil. At $147 per barrel, the cost was too high, helping trigger a recession which depressed demand, with many projects being then cancelled or delayed. In the latter case, some energy sources may already be net energy losers (e.g, possibly ethanol from corn) or very low net energy producers. Society needs a very high net energy return (perhaps something like 20:1) which some sources of oil, like Canadian tar sands don’t provide. Consequently, when the only reserves of oil are too expensive in monetary or energy terms, they will be abandoned, no matter what the price is. Furthermore, the rate of production is important. The oil gushers of the past are now increasingly rare.

            Production rates (scalability) of reserves and utility of substitutes will be key factors, as well as environmental damage.

            There are two things that are not sustainable in a finite world, both of which we’re doing and both of which this article implies we can continue doing forever. One is consuming any resource beyond its renewal rate. The other is damaging our own habitat. Unsustainable behaviours must end, one way or another.

            The economy is a subset of the environment, not the other way round.

          5. While this is true in monetary terms- you can expect $500 oil that would make many reserves profitable, there does come a point at which your ROI bumps into your EROEI (Energy Returned on Energy Invested). The accounting is different for everyone- but basically you can take $499 of stored Coal, Nuclear, Solar, Thermal, etc. energy during the extraction, refining, and shipping of an energy resource and convert it into $500 of final product (In reality $500 oil would retail for much more per gallon, of say gasoline). But you can’t create energy out of thin air, it can only be converted- and it usually does this from dense to less dense (to do the opposite requires more energy). Gasoline is one of the densest, transportable energy sources we have- and like the cheetah who burns 500 calories chasing a 400 calorie meal- you die. So if it takes more barrels of oil equivalent to extract one barrel of oil- it doesn’t matter if you make $1- you are chasing good resources after bad to run sunk costs. It’d be better to not do it at all.

    3. Re: MNG,

      Let’s say your living was made on resource x. And you noticed that there was a limited amount of it and if you kept using it at your current rate you would deplete it at time y (a time before your relaxing retirement). Wouldn’t you, I don’t know, start using less of it?

      Whenever figuring the economics of any scenario, you have to define a few things that are important, like for instance: WHO OWNS RESOURCE X?

      If the person that makes HIS living off resource X is also the owner, he will start using it at the rate his value scale will entince him to use.

      If he does NOT own it, then whoever OWNS IT will exchange the resource according to HIS value scale.

      Does this mean the owner or whoever will use LESS of it? As material X becomes less abundant, the marginal COST for gathering it will have to rise, thus making it more costly in exchange. THIS will entice the owner to raise his price or the user to find alternatives, if the marginal utility of the material lowers.

      So, what are you really asking?

      1. So, what are you really asking?

        MNG is asking for people to repeatedly explain basic economics to him, which he will then ignore because that reality conflicts with his liberal ideology.

        1. Re: prolefeed,

          I would venture a guess that MNG alrady knows some basic economics but would rather ignore what he knows to favor what he believes.

          1. “Let’s say your living was made on resource x”
            Just to add something to this notion of “running out”, let’s suppose “x’ is time. We all have limited time before we run out. So what?

            At some point, we each run out of time.
            At some point, assuming we don’t destroy ourselves, we run out of oil, or we have a substitute. So what?
            At some point, the sun becomes a ?red giant? and we are incinerated or we evolve into plasma beings. So what?
            Things end or run out. Including eventually all humans and the earth.
            So the question arises – why should we save oil? If it is so bad, shouldn’t we gobble it all up so the remaining humans have to drive Priuses, and eat solar powered toast, and save the planet? And run around naked, worship Gaia, and have hot primative sex?

            1. I’m all in favor of the very last activity in your post.

    4. If it is truly a depletable resource that we are going to use, then it will be used up at some point. Stretching it out doesn’t change that fact. Conservation is a good thing, but it is not without consequences.
      The way I see it, people are going to use these resources as long as it is economically feasible to do so, whatever regulations anyone comes up with. So we better damn well hope that someone finds a technical solution or substitute. And the best way to make that happen is to let the market provide the pricing incentive to find a solution to such a shortage.

      1. “Conservation is a good thing”

        I think measures to increase fuel economy (and conserve oil) are the reason we haven’t switched to renewable energies.

        1. Actually since everyone around here says renewables aren’t ready for primte time yet, shouldn’t we try and stretch out the oil till they are?

          Without oil the modern economy doesn’t work. So until there is a subsitute, we’d better make sure it lasts.

          1. Re: Kroneborge,

            Without oil the modern economy doesn’t work. So until there is a subsitute, we’d better make sure it lasts.

            That’s what the PRICE SYSTEM is for – to know how difficult it is to obtain it, and thus allocate it to the more profitable endeavors.

            1. Note, the price system is at list partially broken with oil, because oil is being used as an asset class as well.

              Also note that price works price focuses very much on the short term, not as well on the long term.

              1. Kroneborge|8.20.10 @ 5:49PM|#
                “Note, the price system is at list partially broken with oil, because oil is being used as an asset class as well.”

                Yep, it’s always a fave good where the market doesn’t work.
                Please tell us how an “asset class” is other than a good.

                1. Damn. The pricing system on precious metals must be broken too, since they’re both considered an asset class and have uses in technology as well. What is Kroneborge trying to say? That a natural resource should only be used for a single purpose?

      2. Which means ending all subsidies for those resources at least. Why we need to leave it all to the market beyond that doesn’t make sense to me. The market quite obviously doesn’t take the long-term into account very well, and it certainly has no inherent mechanism for conserving resources to that end. But we can’t even seem to get to the part where we stop actually using policy to favor nonrenewable, planet-killing energy.

        1. Tony|8.20.10 @ 7:53PM|#
          “Which means ending all subsidies for those resources at least.”
          OK.

          “Why we need to leave it all to the market beyond that doesn’t make sense to me.”
          Well, there’s obviously a *lot* that doesn’t make sense to you; you’re not very birght.

          “The market quite obviously doesn’t take the long-term into account very well, and it certainly has no inherent mechanism for conserving resources to that end.”
          Lie and lie.

          “But we can’t even seem to get to the part where we stop actually using policy to favor nonrenewable, planet-killing energy.”
          Followed by some religious rant of other.
          Please tell us of the life-cycle of a planet. In non-religious terms.

          1. You are useless.

            1. The government obviously doesn’t think all that much about the long term. For examples, see things like the Superconducting Super Collider, the particle accelerator to be built in Texas which spent $2 billion of its $5 billion budget before Congress pulled funding and abandoned the project. See any number of military aircraft programs which are cancelled after spending billions of dollars in development costs. Of course, these are very small lapses in long term planning when compared with things like Social Security and Medicare!

    5. MNG|8.20.10 @ 12:05PM|#
      “Let’s say your living was made on resource x. And you noticed that there was a limited amount of it and if you kept using it at your current rate you would deplete it at time y (a time before your relaxing retirement)….”

      Let’s say, like MNG, you really have no idea when that resource is going to be ‘depleted’ (whatever that means).
      I’m gonna presume you’re an adolescent who hasn’t been around long enough to notice that since, oh, 1950 or so, we’ve only had a twenty-year supply of oil.
      If you had, you’d know that when some brain-dead starts screaming about ‘running out of X!’, he’s the equivalent of the guy on the street-corner in the sandwich board.
      (BTW, was that you at Market and Powell?)

      1. Depleted means run out, no more oil that we can get at. It’s not some cosmic concept. There is not an infinite amount of oil.

        1. The earth will CONTINUE TO MAKE OIL for another billion years.

        2. Do you know how much oil is left?

        3. “There is not an infinite amount of oil.”

          As oil becomes more difficult to extract it will become more expensive, and at some point it simply will not be worth the cost.

          When that happens there will still be all kinds of oil left underground.

        4. MNG|8.20.10 @ 1:05PM|#
          “Depleted means run out, no more oil that we can get at. It’s not some cosmic concept. There is not an infinite amount of oil.”

          In that case you’re doubly the fool. We will *never* “run out” of oil.

          1. In that case you’re doubly the fool. We will *never* “run out” of oil.

            You’re very correct, since we stop drilling before it runs out as it becomes cost-ineffective.

            So thanks for the pedantry.

            1. Tony|8.20.10 @ 7:57PM|#
              “In that case you’re doubly the fool. We will *never* “run out” of oil.”

              “You’re very correct, since we stop drilling before it runs out as it becomes cost-ineffective.
              So thanks for the pedantry”

              You’re certainly welcome. Now please explain how the claim that ‘we’ll run out of X means anything at all.

              1. Running out of oil and not being able to get it profitably anymore are the same thing as far as our lives are concerned. What’s your point again?

                1. I think the point is that we’re tired of the chicken little bullshit: “the sky is falling, the sky is falling, the government needs to do something quick”
                  because government thinking is typically very, very short term as in two-year election cycles and what can I get for my district in the next three months. So EVEN IF the government could IN THEORY plan and manage something, IN PRACTICE it rarely works out that way. So you are wrong on theoretical grounds as well as practical grounds.

                  Most examples you try to point to as market failures, if you look closely enough, you can see the hand of politicians in the past using short term selfish thinking guiding it.

                  No one here ever says that markets work perfectly, just that they work well in most cases and better than the alternative.

                  This idea that wealth is something that countries need to fight wars over is exactly what Adam Smith was arguing against. He also made the case 230-odd years ago against doing things through the political system. Many people and industries want favors and protection from the government at the expense of the consumer – i.e. the ordinary citizens.

        5. Re: MNG,

          Depleted means run out, no more oil that we can get at. It’s not some cosmic concept. There is not an infinite amount of oil.

          There isn’t an infinite amount of lapis lazuli, yet there it is, still available. It is just that we don’t cover the walls of our homes with it, but that does not mean there is NONE to find.

          Yet people DO have very colorful alternatives to lapis lazuli – I wonder how that happened . . .

        6. Actually it may be infinite, check out the GameChangers group at Shell…

          1. Ha, innovating ways to “extract heavy oil.” It’s remarkable how short-sighted these companies are, a humongous example of the market being destructive rather than constructive, out there for anyone to see. A really smart oil company would use some of its vast mountains of dollars to corner the windmill market and research advanced batteries. Instead they’ve spent decades undermining efforts that may replace their product–short-term rational, just like every other cartel.

            1. Tony|8.20.10 @ 8:04PM|#
              “Ha, innovating ways to “extract heavy oil.” It’s remarkable how short-sighted these companies are, a humongous example of the market being destructive rather than constructive, out there for anyone to see.”

              Or, at least brain-dead assholes to claim.

              1. Tony, you can comment as much as you like on how short-sighted companies like Shell are. What’s your point? If a company is short-sighted and misses out on the change to develop a revolutionary technology, it fades away and some other company rises to prominence. Happens all the time. This seems to be more of an indictment of the individual company than the market itself.

                The great thing about this scheme is that when the company is short-sighted and becomes unprofitable, only those silly enough to have invested in its short-sightedness are harmed financially. Yet the government spends billions of dollars every year on technologies which will never make it. When this happens, everyone loses out, including those who never agreed to support the technology. Which system is more ethical?

            2. Exactly the way the IBM let two small companies called Apple and Microsoft take over much of the market.

              It is typically not the big companies in one business like oil that start developing wind and nuclear, etc. They do what they know best and come up with new technologies to extract and refine oil more cheaply or more efficiently. Other (small cap-start-up) companies come up with new products and innovations in newer technologies, often not foreseen. Which is exactly why having the government try to see into the future and come up with new technologies does not work very often or as efficiently. You can point to the internet as having it’s beginnings with government as well as satellites but once the concept was out there or the initial infrastructure, they have developed and become privatized on their own. In some cases the government may have sped up some things but this is probably dwarfed by the many occasions when capital and investments are mis-directed through political shenanigans. The argument about the space program creating new technology is overblown though since it would have been much cheaper to just fund basic research into some of these technology areas.

              Finally, (I realize since I am responding 12-14 hours later, this may not be read by the intended target but ….) the basic argument in order to believe that the government can plan for future technology (or in any area for that matter) better is that a few thousand people, many of them politicians with short term agendas, will have more and better ideas than a few million people, most of them working in areas of their expertise and driven by a passion for their work.

    6. “Wouldn’t you, I don’t know, start using less of it?”

      That’s exactly why we need markets that are undistorted by inflation, which drives expansion and growth over saving, sustainability, and prosperity.

      1. Not just inflation, which we may see more of soon, but the big emphasis seems to be on propping up the housing bubble, and making sure that interest rates are low so that people keep on spending and borrowing and that people who should not be buying houses, keep doing so. And the gov’t needs to triple the stimulus, just spend money, it doesn’t matter how or where, just spend it quick to “jump-start” the economy to use another car analogy.

    7. Re: MNG,

      What kind of Pollyana would you have to be to keep on using at the current rate all the while proclaiming “they’ll invent a substitute, I just know it, I know it!”

      If you read the article, Ron is already giving examples of how in the face of higher prices (i.e. scarcity), entrepreneurs are already coming up with alternative sources and technologies. I don’t understand why would you say it is not wise to think that innovation cannot happen – how would YOU know?

      1. Of course innovation has happened, my point is that sitting around hoping for it as the only response is Pollyanish nonsense.

        Sometimes the calvary has come and saved the day, sometimes it didn’t. When your surrounded you better have a better plan than just hoping for the former…

        1. Re: MNG,

          Of course innovation has happened, my point is that sitting around hoping for it as the only response is Pollyanish nonsense.

          This is a moronic argument, MNG. Who’s sitting down? The argument that depletion of certain resources will entice innovation is an economic argument, not Pollyannaism.

          Sometimes the calvary has come and saved the day, sometimes it didn’t.

          Your powers of omniscience are astounding. HOW would you KNOW that, MNG? Are you privvy to ALL THE HISTORY of “resources depletion” to *know* this?

        2. MNG|8.20.10 @ 1:06PM|#
          “Of course innovation has happened, my point is that sitting around hoping for it as the only response is Pollyanish nonsense.”

          You bet! Why,l just pull a gun and *tell* someone to invent that stuff, right MNG?

        3. Planning is planning.

          1. stupid is stupid.

        4. Sometimes the calvary has come and saved the day, sometimes it didn’t.

          Can you name an instance when a critical good was depleted without a substitute being invented or discovered?

    8. The Stone Age didn’t end because humans ran out of stone.

      1. The bronze age DID end when people ran out of wood with which to smelt copper for bronze.

        And there was much suffering.

        1. Re: Omni,

          The bronze age DID end when people ran out of wood with which to smelt copper for bronze.

          And there was much suffering.

          Apart from being lousy at making economic arguments, you are just too incompetent to be a historian. The “Bronze Age” ended when iron (which requires an even higher temperature, and thus more fuel, to be workable) became more plentiful, not because people ran out of wood.

          Dumbass.

      2. Too bad they aren’t still making Flinstones episodes. I’d love to see Wilma checking out the Daily Slab and its headline IS PEAK STONE IMMINENT?

    9. Ming,
      So suppose you own the rights to some oil in the ground. If you think that it might be more scarce in the future you might just leave it there or pump it at a slow rate but you would need to consider how useful the oil will it be in 10 years, 20 years, 50 years, 100 years. You might rationally say that it is a good bet that oil will be more expensive in 10 years maybe even 20 years due to depletion but you might think in 50 years it may be cheaper due to electric cars of whatever.

      So if holders of oil rights are already thinking that way and there are ready substitutes, which there are, why sweat it.

    10. BTW have you hedged oil? Are you storing up gasoline (remember to ad a stabilizer) in a big tank somewhere?

    11. If we actually start running out, presumably it will run out in some places faster than others, thus the rate of production will decline over time.

      As the rate of production declines, consumption will necessarily decline, but demand will still be high enough that prices will rise quite a bit — enough to ensure that alternatives will be found, either in terms of similar energy sources, or in terms of more efficient use of what energy sources we have. Failing that, society will simply cut a lot of luxuries that it can no longer afford.

      It only becomes a problem if people panic and do stupid shit, like starting a bunch of wars or crippling their own economies or redirecting valuable development resources into dead-end technology.

  2. Y’all lost me at “New at Reason”. This is a repeat article.

    Not good to start an article with a blatant, easily disproved falsehood.

    1. PEAK REASON!

  3. Ron, you missed the worst element: peak helium.

    Unlike every other element we use, helium, one used, is gone. Once it reaches the atmosphere, it inevitably escapes into space because of its low mass. Then it is lost to us. Helium supplies are already strained (it is a by-product of oil and gas collection), and things aren’t going to get better in the future.

    Every other element is in principle recyclable. The market will find solutions to the shortage of any particular element….but very likely at a high price. For most elements, prices will generally drift upwards as we exhaust the highest-quality supplies and are forced into either lower-grade ores, or to recycle. We won’t “run out”, but we will be paying dearly for our raw materials. However, since such materials only account for about 10% of the economy, even if they tripled, it wouldn’t be the end of the world. It would, however, cause some significant shifts in consumption patterns.

    1. Helium is one of the more abundant elements in the universe.

      What’s next, worrying about “peak sand” or “peak water”?

      Helium supplies are not strained. You can go out and buy as much of it as you want, if you’re willing to pay the market price for that. If the price goes high enough due to demand, people will cut back on party balloons. This is not a tragedy, you moron.

      1. Helium is one of the more abundant elements in the universe.

        But not all that abundant on Earth, unless you are proposing sending spaceships up to ‘mine’ helium and ship it back. Is there any use of helium for which there is no reasonable substitute?

        1. Is there any use of helium for which there is no reasonable substitute?

          Not if you look forward to shrieking “oh the humanity!” at kids’ birthday parties

          1. i believe that is a feature, not a bug.

          2. You’re listening to the recording at too high of a speed. Herbert Morrison was known for his deep voice.

        2. Cryogenics maybe. Liquid helium is pretty damn cold. Liquid nitrogen is at 77 K, but I think helium is at 25 K.

          Liquid nitrogen is also pretty damn cheap. I think the last number I heard was 77 cents per gallon.

          1. AWESOME at kids’ parties for making ice cream! so screw helium, we hardly knew ye.

        3. I would argue yes. Helium is used in children’s balloons to allow them to float in the air. It is safe for that purpose. There are other gases that could be used, but have safety issues. Take Hydrogen for example. The Balloon would float but would also be very explosive.

        4. Hydrogen is way more fun than helium.

        5. Liquid helium is used often in chemistry (and physics) to cool things and is needed to superconducting magnets and mag-lev trains and such but with the advent in recent years of room temperature conductivity materials, hopefully soon we can just use liquid nitrogen. Our atmosphere is 78% nitrogen gas.

          Helium can be produced in fusion reactions from hydrogen which we can get from seawater if necessary, but I don’t ever see this as an economical way to get helium, but who knows?

      2. What’s next, worrying about “peak sand”

        See glass recycling.

        1. Whew. Sure don’t wanna pay more to be able to tell some one to go pound the stuff. Broken glass, however, it just doesn’t ‘sing’. . .

      3. Re: Prolefeed,

        I believe Chad is trying to push the round peg of “market failure” on the square hole of reality. People who rely on Neo-classical economics (actually, Keynesianism in drag) to justify interventionism will be quick to throw this “market failure” canard – hence his interesting (in the psychological sense) preoccupation with the supply of helium.

        When people who understand economics see the depletion of certain resources, they see entrepreneurs jumping at an opportunity. Chad and other eleutherophobics see the opportunity for wholesale tyranny.

      4. Wrong. Helium is distorted by the government.

        http://www.newscientist.com/ar…..elium.html

        Of course. He’s wrong about one thing:

        “The use of helium in cryogenics is self-contained”

        Not when the magnet quenches!!

        Seriously. Peak helium is a problem. The crux of it is that helium’s thermal velocity at earth temperatures is higher than the escape velocity at the radius of the earth’s surface. So we bleed helium out to the vacuum of space.

        1. So we bleed helium out to the vacuum of space.

          But it’s replaced.

          From the wiki article:

          In the Earth’s atmosphere, the concentration of helium by volume is only 5.2 parts per million.[65][66] The concentration is low and fairly constant despite the continuous production of new helium because most helium in the Earth’s atmosphere escapes into space by several processes.

          1. Of course there’s a steady state system.

            Earth -> air -> space

            The concentration of helium in the air is going “to be replaced” precisely because the rate out depends on the concentration in air; if there’s less helium in the air, then there’s less depletion to space.

            That doesn’t mean that fractional distillation of air to retrieve helium is a viable solution. Where do you get the energy to run the process?

            At the moment, the only economical way to extract helium is by mining.

            1. No, helium is just an alpha particle. It’s created through radioactive decay. In other words, the creation of helium is not a function of the concentration in the air. It’s a function of the rate of decay of radioactive materials in the earth.

              They extract helium through the fractional distillation of natural gas. The natural gas might be “mined” , but the helium isn’t. They don’t extract it from the atmosphere.

              1. I never said that the creation of helium is a function of its concentration of air. I said the depletion of helium is a function of its concentration of air.

                Any state that has an in- and an out- will reach some steady state.

                In the case of helium (in the air) that steady state is really shitty and low.

                They extract helium through the fractional distillation of natural gas. The natural gas might be “mined” , but the helium isn’t. They don’t extract it from the atmosphere.

                Thank you for reinforcing my point.

                1. Thank you for reinforcing my point.

                  I don’t think you actually have a point.

                  My beef with you is that you repeatedly make inaccurate statements. Your choice of words is inexact.

                  The concentration of helium in the air is going “to be replaced” precisely because the rate out depends on the concentration in air

                  The rate at which the helium is replaced is solely dependent on the rate of radioactive decay in the earth. Radioactive materials in the crust neither know nor care what the concentration of helium in the atmosphere is. The creation of helium in the crust is a completely independent process from the escape of helium into outer space.

                  Your inaccurate statement above implies that the rate that helium escapes from the atmosphere controls the rate at which helium is produced in the crust.

                  1. Helium is not an alpha particle, it is an atom with two protons.

                    1. whoops! look at me, being inaccurate.

                      alpha particle is a helium nucleus, all it needs are the electrons – which we seem to have PLENTY of.

                    2. You’re still being inaccurate.

                      Until it finds electrons it is an alpha particle. It doesn’t become a helium nucleus until there is at least one electron orbiting it.

                    3. Until it finds electrons it is an alpha particle

                      alpha particle = helium nucleus
                      alpha particle != helium atom

                      The standard in atomic and nuclear chemistry is to write the alpha particle either as the greek alpha or as a helium atom as a +2 ion.

                      So, I’m completely justified in calling an alpha particle a helium nucleus.

                    4. Also,the identity of an atom is dependent on the number of protons in the nucleus, not on the number of electrons orbiting it.

                    5. Also,the identity of an atom is dependent on the number of protons in the nucleus, not on the number of electrons orbiting it.

                      Well to get on the pedantic bandwagon, an atom is an electroneutral species, and an ion is the charged particle.

                    6. Well to get on the pedantic bandwagon, an atom is an electroneutral species, and an ion is the charged particle.
                      reply to this

                      But the ion is still identified as belonging to a particular element because that’s determined by the number of protons in the nucleus. An atom does not have to be electrically neutral.

                      The definition of an ion is “a charged atom or molecule.”

                    7. Peak electrons??

                  2. that’s why I put “going to be replaced” in scare quotes.

                    1. but yeah I’m guilty as charged for being inaccurate. What I meant to say is that a steady state concentration in the air exists because the out rate is dependent on the concentration in (and there is a separate in-source).

        2. The use if helium in cryogenics is NOT self contained! Helium can diffuse through metal.

          1. not to mention quenches, if you’re using it to chill a magnet.

      5. Helium is abundant in interplanetary space. But that does bugger all for us here on earth, where we need it.

        And yes, you can go out and buy as much as you want at the market price. And when the market price goes up too high for your local hospital to get its hands on any, it will have to shut down its MRI machine. And any patient who needs it will no doubt be very happy to learn that “the market” thought birthday parties 10 years ago were more important than keeping an MRI machine running 10 years from now.

        Natural resources are where libertarians increasingly sound as ridiculous as Trofim Lysenko.

        1. Actually, what will probably happen is the loss of MRI helium will drive the production of high-T superconductors. Researchers are aware of this and are rapidly engaged in the development of LN2-level superconductors.

          “Natural resources are where libertarians increasingly sound as ridiculous as Trofim Lysenko.”

          It only seems that way because libertarians often forget that market distortions towards consumptionism are driven by inflationary behavior of the government, and libertarians often root wanton consumption when that’s not natural at all.

          1. Congratulations, you fell right into the Libertarian Lysenko trap:

            Actually, what will probably happen is the loss of MRI helium will drive the production of high-T superconductors. Researchers are aware of this and are rapidly engaged in the development of LN2-level superconductors.”

            And whether they succeed will be determined by the laws of nature at the atomic lattice level, and not by the price of Helium. It remains to be seen whether LN2 superconductors are a practical way to build an MRI scanner.

            1. it’s only a lysenko trap if it’s blind faith. The development of high-t superconductors is very real.

              1. And very useful for high voltage long distance power transmission, because the currents and magnetic fields involved are steady. A variable field like an MRI scanner’s is a far harder problem, especially with materials that quench if the lab tech down the hall receives a text message on his damned iPhone.

                Might be feasible. Might not. But that question will be answered by physics, not economics. To think a price signal can change the laws of physics is just as foolish as thinking socialism can create the new pea.

                1. Last I checked MRI fields were supposed to be steady. It’s a problem when you field strength starts drifting. We had a 300 Mhz workhorse NMR that had to be tuned every week, they kept it around because it was the only unit that had the 31P probe but eventually they sent it to the glue factory.

                  1. Who cares whether or not the high Tc superconductors can be used to make MRI magnets? There are a lot of other ways to make MRI feasible in the event of helium supplies running out. One would be replacing current induction-based methods for detecting magnetic resonance with optical methods, which can be performed at low or even earth’s field. Even if these methods couldn’t save MRI from the helium shortage, what does it matter? Some technology would replace it. CT-based methods or PET-based methods, most likely. The whole point of this article and technology in general is that there is no single technology which cannot be displaced by another (perhaps technically superior) technique if the economics dictate it.

                2. And eventually, high-T supercons may lower energy costs across the board by limiting losses in power lines, etc.

                  Which cuts the amount of oil we use.

          2. “It only seems that way because libertarians often forget that market distortions towards consumptionism are driven by inflationary behavior of the government, and libertarians often root wanton consumption when that’s not natural at all.”

            But that said, I do agree with this.

        2. if only we’d regulated neodymium before we even knew what we’d need it for?

          Thinking that the natural resources of today are what we will require tomorrow is where central planning seems always behind the curve.

          1. The central planners who got America to sit on its helium reserves were generals in the military, trying to prep for WW2, and later on generals in the Pentagon trying to win the Cold War.

            The central planners who got America to fritter it away were political hacks in 1994.

            I know which group deserves more respect.

            1. I like how central planner always trumpet their preparedness for war as a positive thing.

          2. ^^^^^^^^^^THIS^^^^^^^^^^

            1. (@gaijin|8.20.10 @ 1:01PM|) BTW.

        3. Re: Omri,

          And yes, you can go out and buy as much as you want at the market price. And when the market price goes up too high for your local hospital to get its hands on any, it will have to shut down its MRI machine.

          You’re an idiot. If the market price goes up, then it will be too expensive for balloons, not for MRIs. The price reflects the marginal value of the good.

          Dumbass.

          Natural resources are where libertarians increasingly sound as ridiculous as Trofim Lysenko.

          Idiots who understand little of economics sound just as ridiculous as third world politicians who promise abundance – just like Obama!

          1. And yes, you can go out and buy as much as you want at the market price. And when the market price goes up too high for your local hospital to get its hands on any, it will have to shut down its MRI machine.

            You’re an idiot. If the market price goes up, then it will be too expensive for balloons, not for MRIs. The price reflects the marginal value of the good.

            It will be too expensive for both. Because 20 years before, it was cheap enough for both.

            1. Something makes me think that people are more willing to pay increased prices for MRIs than they are balloons.

              This is what economists call “marginal value”

              1. There is willing, and there is able.

              2. Are you serious??

                What about the children?? We need He balloon subsidies now.

            2. Re: Omri,

              It will be too expensive for both. Because 20 years before, it was cheap enough for both.

              How do you know it will be too expensive for both? I would love to know your soothsayer powers, Omri.

              If helium becomes less available, the LESS VALUABLE applications will be dropped FIRST, in favor of the more valuable applications. The price of helium will then be more expensive for balloons which bring a lesser marginal utility than an MRI, but it will not be “too expensive” for MRIs.

              Just look at the profit margin for a balloon versus the profit margin of an MRI, and you will see that an increase in Helium prices of just 10% will make balloons less profitable FIRST, not at the SAME TIME.

              Again, you’re an idiot – this is basic stuff.

              1. You guys are talking past each other. Omri is just saying that it COULD get to the point where it’s too expensive for either.

                And, possibly, before something can replace it for the less-frivolous (my judgement) use.

                Yes, we would start cutting back on the helium baloons (probably)… But then what? It might be too late, especially what with government subsidizing the shit out of it.

                1. Re: Yonemoto,

                  Omri is just saying that it COULD get to the point where it’s too expensive for either.

                  It COULD, but how likely is that to happen at the very same time? Omri thinks it will. I say he’s an idiot. My money is in my assessment of him, not his assessment of the situation.

                  1. Same time? I did not say that. It will be too expensive for balloons in poor countries. Then for hospitals in poor countries. Then for balloons in rich countries. And then for hospitals in rich countries.

                    And at that point, the people who frittered the stuff away on birthday parties will be cursed.

                    1. Re: Omri,

                      Same time? I did not say that. It will be too expensive for balloons in poor countries. Then for hospitals in poor countries.

                      You’re being dishonest! WHERE did you say that? Read your OWN post again, Omri!

                      And again, you’re thinking that once helium becomes too expensive for balloons it will shortly become too expensive for MRIs. If it becomes too expensive for balloons in poor countries, it will become too expensive for balloons in wealthier countries FIRST, before it could become “too expensive” for MRIs ANYWHERE. MRIs still have a higher marginal utility than a balloon, doesn’t matter if you’re in Sweden or Timbuktu.

                      Dumbass.

                      And at that point, the people who frittered the stuff away on birthday parties will be cursed.

                    2. “You’re being dishonest! WHERE did you say that? Read your OWN post again, Omri!”

                      Read it again. I said there will come a day when the price is too high for your local hospital. I did NOT say it would eb the same day when it got too high for birthday parties.

                      I did say that this day will come some years in the future because of how we wasted this stuff some years in the past. That is still true. As is your lack of reading ability.

                    3. Re: Omni,

                      Read it again. I said there will come a day when the price is too high for your local hospital.

                      You’re avoiding the issue again. WHERE did you write that POOR countries would suffer expensive balloons AND expensive MRI?

                      I did say that this day will come some years in the future because of how we wasted this stuff some years in the past. That is still true. As is your lack of reading ability.

                      Your dishonesty knows no bounds – you IMPLIED it would by writting this piece of stupidity:

                      “And any patient who needs it will no doubt be very happy to learn that “the market” thought birthday parties 10 years ago were more important than keeping an MRI machine running 10 years from now.”

                      That’s an extremely SHORT span of time to say *now* that it was not what you meant.

                    4. All this Helium talk… I think I will look into buying some Helium futures.

            3. Wouldn’t forward-thinking sorts purchase stockpiles so that when the price inevitably goes up, they can make a killing?

              Oh wait, no, government hates saving shit up. Bad for GDP.

    2. I think you discount the coming Fusion era, whose primary bi-product is helium. Right after we get flying cars and jet-packs consumer-grade.

      1. otoh, even if Bussard’s Polywell concept doesn’t pan out for producing energy, it still cranks out He, so kid’s birthday parties everywhere are safe, but may become more expensive.

        1. We’re not going to be running polywells to crank out helium at a rate of a few hundred atoms per second.

        2. Then you have to worry about peak Boron.

    3. Do you have any idea where He comes from? Any at all? Clearly not. Go take a high school physics class you disingenuous cretin.

      1. Dunno about Chad, but Helium comes from the ground. It’s a byproduct of radioactive decay. That means that there are going to be pockets where geology has concentrated helium. As those pockets run out, it becomes progressively more and more difficult to mine helium, EVEN though the earth keeps regenerating helium.

        This is simple physical and economic fact.

        1. Thanks for the lesson, that’s what I was getting at. However, all of the “depletion” talk of recent years is not about exhausting our available planetary reserve, but of the current stockpile. Extraction is well below where it could be, several production facilities are late getting online, and there are programs (the shuttle being one) that use (or used to) massive quantities. The problem is not currently one of “running out” of a non-renewable (or slowly renewable in this case) resource, but one of production limiting supply and causing a price increase. Guess what happens to production when prices increase?

          1. Well there is going to eventually be a hard limit on the extractable rate. It’s not like the earth is an inverse black hole indefinitely spewing out alpha particles.

        2. Dunno about Chad, but Helium comes from the ground.

          I think Chad also comes from the ground.

    4. Ron, you missed the worst element: peak helium.

      Whatever will we fill our balloons with?

      http://en.wikipedia.org/wiki/H…..production

      How about we talk about the depletion of Uranium-235? You know, something that’s actually useful, is relevant to the energy issue, and has other uses besides filling balloons and cryogenics?

      Uranium-235 is interesting because you can actually look at how the price will increase within a lifetime because of it’s use in reactors and the rate at which it decays. It’s much more useful to illustrate an economic point than using oil because people actually keep track of exactly how much 235 is available because it can used in weapons.

      1. Yep. Radioactive material is the one resource that goes away, all by itself, regardless of whether we use it or not. Not exploiting the hell out of it while we can is pretty dumb.

        1. We also don’t use what we have very efficiently. Because of the once-through policy put in place because of fears of nuclear proliferation, we just throw away perfectly good nuclear fuel instead of putting it back in the reactor.

        2. Two words: Breeder Reactor.

          1. Yes, but breeders don’t produce U-235, they produce plutonium – which is also used in weapons, so breeders are frowned upon.

            Reactors are typical started using a U-235 mixture. The fission then produces a fissile plutonium isotope which can also be used to fuel the reactor, but it’s also used in weapons, so we throw it away, and use more U-235 to keep the reactor going.

      2. You guys might like this article: “Nuclear Wasteland”.

    5. You make the assumption that we’ll never figure out another way to make helium (a very small and simple atom) from anything else.

  4. Sorry, this falls under the category “Shit We Already Knew”.

    The irrational environmentalists should be encouraging the use of petroleum. After it’s gone their dreams of a wind and solar powered world will be much closer to reality.

    Kinda like hydrogen fusion, only a couple of decades away.

    1. Except that the supply of petroleum will NEVER be depleted. It will simply get more expensive until replacement sources of energy and the raw materials for plastic, etc. become more economic to use, and the demand for these things drops due to price signals, etc.

      People will adjust.

      1. Or, discover that the whole dead dinosaur thing is a crock, and that it’s actually the result of a biological process that we can exploit to the amount that the market will bear. Little bugs that eat CO2, drink water, bask in the sunlight, and shit diesel. Oh, look!

        1. 1) probably not basking on sunlight, but recycling, say the carbon dioxide sink of salps and using geothermal, for example.

          While it’s certainly a possibility, and left-wing douches shouldn’t put it down just because it challenges their claim to enlightenment. What if you’re wrong. How much would you willing to bet on it?

          1. The technology is already under development. It’s lab level presently, but indications seem good that it’ll scale. Unfortunately, it may scale to the point that one would have to cover most of the world’s desert’s to obtain enough hydrocarbons to totally replace ground recovered amounts, but it’s still rather promising.

            1. Oh yeah, genetically modded critters that will do that. I’m aware. The lab next door to mine in grad school was trying to do this. The lab below me now as a postdoc is trying to do this. It’s not going to work… Those people have no sense of “economical”. EG. A grad student in a biofuels lab started up Pearl Biotech:

              http://www.pearlbiotech.com/buy

              Are you fucking kidding me? A gel box for $500?

              You think that there aren’t huge environmental issues with flooding, say, the arizona desert?

              1. …and how do you keep your critters from being overtaken by the natives. It takes a lot of effort to maintain a metabolically unfavorable gene (for example one that lets us steal energy) in such a large, wild population.

              2. That’s a nice gel box! Pretty much exactly how we used to do it 20 years ago – except we didn’t put the UV underneath, we had a hand-held UV source. And our box was home-made and didn’t have any fancy curved pieces of plastic like that. But otherwise it was the same idea.

                Actually, when I started you’d pour your gel in a mold and then put it in the box to run. But I was a lazy SOB so my post-doc and I started pouring them in place, and making them with buffer solution so we didn’t have to wait so long before running our samples. And if we didn’t need to isolate the DNA, we’d double-run the things, loading another sample behind the first one. I guess we should have published our techniques. Is there a journal for “lazy-ass sloppy scientific techniques that save lots of time and make tight-ass by-the-book types cringe?”

                1. Yeah but $500? I think you can buy Bio-Rad’s top of the line for $200! I’m actually in the process of building one for $50 in parts and selling it for $100. Also building a $500 PCR machine.

                2. Sorry for not being around to contribute to this fun conversation that spawned off my friday-lunch post.

                  I just wanted to point out something about algae fuel: IT MUST BE GROWN OUTSIDE. There is no other way. You couldn’t even cover the capital costs of a simple greenhouse with a 5% efficient sunlight-to-diesel system…and that’s an more than an order of magnitude more efficient than anything that exists now, and near what the limits of photosynthesis’s physics limit us to.

  5. So, all this shit is escaping the gravity well, gone forever? AIEEEEEEEE!!!! Maybe it really IS time to panic.

    1. Heh. The Volt and the Prius can’t reach the next state, much less escape velocity.

      1. Huh? My Prius gets 550 miles per tank…

  6. There will always be abundant supplies of fear, however. And at bargain basement prices.

    1. ^^ excellent!

      1. One of the smartest things I’ve ever read at Reason (that wasn’t written by Peter. Man, I just love that kid!).

  7. In March, Rep. Mike Coffman (R-Colo.) introduced the Rare Earth Supply-Chain Technology and Resource Transformation (RESTART) Act of 2010. The RESTART Act would offer federal loan guarantees to mining and refining companies to recreate in five years a domestic rare-earth minerals industry, achieving a kind of rare-earth minerals independence.

    All you have to do is apply for the grant, and you’re set for life . . . rare-earth mining or no rare-earth mining.

    The government doles out subsidies to farmers also, some of them not being real farmers doing real farming, so one cannot be accused of being cynical about these proposed mining “loans.”

  8. It’s the MNG and Chad show. The question is how’s hand is up who’s ass?

    1. Together they form the statist ouroboros?eternally fisting its own ass.

  9. You damn scientists need to stop inventing stuff already. You’re making me look like an idiot.

    1. As long as there are progressive assholes who think there are too many poor stupid people on the planet, you will always be loved.

      1. Relax, TM, you’ll always be valued. For humor value, if nothing else.

      2. As long as there are libertarians in need of a straw man, Thomas, you will be brought forward, misrepresented and mocked.

        (Here’s a hint, dude: progressives loathe Malthus because he was the ultimate conservative. Here’s Malthus’s solution to population:

        No sex before marriage.
        No marriage before husband can prove he can start a household.
        No subdivision of estates. Eldest son gets it all. )

        1. The general broad strokes of Malthusianism aren’t incompatible with libertarianism – in fact, limited resources make the best argument for property rights on account of the tragedy of the commons. The only way to handle diminishing resource extraction without coercion is through the markets. Let individuals decide what they want more.

          It’s a pity that more libertarians DON’T embrace Malthusianism (well the less prescriptive parts anyways).

          1. I.E. and illibertarian state will descend into tyrrany during production-related shortages. A libertarian state will preserve human rights.

        2. Re: Omri,

          [P]rogressives loathe Malthus because he was the ultimate conservative.

          So what you mean is that Progressives have the habit of dismissing an argument (i.e. “Overpopulation”) based on an Ad Hominem. Is that your contention?

          1. No. Just that they don’t think about Malthus at all.

            1. Re: Omni,

              No. Just that they don’t think about Malthus at all.

              Liar.

              http://www.amazon.com/Populati…..1568495870

              http://dieoff.org/page27.htm

        3. Ummm, Omri, Malthus was writing at a time before effective birth control.

          Of course he thought that abstaining from sex was the only way to avoid having children. Everybody did!

          1. Well in a time before birth control and one child policies, he was right.

    2. Don’t forget me! I’ve looked like an idiot for a long time.

  10. I hope we have reached peak Mosque stories.

    1. And here I woke up with the urge to mosquerbate today.

      1. I remember when I was young, waking up with morning minaret.

  11. Eleutherophobe

    adj. A person with an irrational dread of freedom. Also see “Busy-body Statist Asshole”

    1. I think bitch is a better definition than asshole.

  12. Peak potash is in the news.

  13. We will never hit peak a-boo.

    1. I’ve been hearing about Peak Antifreeze since the 60’s.

      http://www.peakantifreeze.com/peak_global_lifetime.html

  14. suck it, neighbor who complains about me pissing on my compost pile.

    1. I guess that’s one way of adding nitrates….

    2. I predict your founder dies a painful death soon.

  15. “China’s government recently warned that it would begin restricting exports of neodymium and other rare-earth metals to ensure supplies for its own manufacturers.”

    Just for the record, what China is doing–and has done–is insist that manufacturers who use rare earth metals that they have move their manufacturing to within China…

    It’s not that they’re refusing to sell it to anyone else in the world; it’s that they’re insisting that anyone who buys it should manufacture whatever they’re using rare metals for in China.

    You can export whatever you used it in, but you must manufacture it in China.

  16. It’s in our interest to start thinking about being ahead, not behind, the curve on this.

    And, how exactly do you know that “we’re” not?

    Oh, because you’re not aware of anyone who is, right?

    1. Exactly. Only a hopelessly ignorant blowhard could make the argument that we are “behind the curve” on preparing for a rise in petroleum scarcity. The amount of research and money going into this field via VC money and via internal projects of petroleum companies currently dwarfs any amount of money you could even optimistically hope to force your fellow citizens to spend via government. The race is on and all integrated oil majors and all the VCs are well aware that it’s a trillion dollar prize to the winner.

      Raving alarmists clamoring for a govt Manhattan-project of energy are utterly clueless about what is really going on.

  17. Enough already…

    I’m getting dizzy spinning in my grave. Didn’t you read anything I wrote 30 years ago?

    MNG…I’m gonna give you a nuggie when I see you…

  18. “We consistently fail to grasp how many ideas remain to be discovered.”

    what ideas have we discovered pertaining to energy that can relieve the need for fossil fuels? and if we have discovered them, and they really can substitute fossil fuels, why haven’t they?

    if fossil fuels have to get painfully expensive before alternatives become viable, then that implies that even once alternatives represent a meaningful amount of energy production, our overall energy costs will be greater then they are, say, nowish. what will that do for the economy?

    never mind, fusion should do the trick.

  19. I like science fiction as much as any libertarian, but there is nothing inherently wrong with planning for things. You want the government to act like households fiscally, but you don’t want it to plan anything? Do you run your households without planning?

    1. Tony|8.20.10 @ 8:12PM|#
      “I like science fiction as much as any libertarian, but there is nothing inherently wrong with planning for things.”
      I like making fun of brain-deads as much as any libertarian, and stupid non-sequitors from them are at the top of my list.

      “You want the government to act like households fiscally, but you don’t want it to plan anything?”
      Not at all. The government should plan on cutting spending so there’s capital available for those who know how to use it.

      “Do you run your households without planning?”
      Nope. Our household has plans for what we can accomplish.
      Unlike your (brain-dead) innuendo that government can somehow ‘plan’ for energy sources.

      1. Are you OM’s boyfriend? You both like to drop logic 101 terms as if their mere presence will cause collateral damage.

        As I said above, planning is planning. It’s obvious the ‘spontaneous’ movements of market actors can’t plan for shit, so that’s what government is for. Sure it can do a bad job if idiots like you vote for idiots who believe what you do. But it doesn’t have to.

        1. Planning for households makes sense because of the scale. It’s people like you with a paleolithic sense of morality that believe you can extend this philosophy to mass markets. What makes sense in small hunter-gatherer societies doesn’t in mass markets. Unfortunately, your morality hasn’t developed beyond this. Libertarians accept that in small units, planning is fine, but on a large-scale it fails disastrously, because there is an infinite knowledge problem. Government planning, like turning around the Volga River in Russia, because man really can conquer nature. Nothing has changed. If billions of individuals can’t plan, what makes you think elected officials can? Where did they get their superior knowledge?

          1. *small units such as families*

        2. Tony|8.20.10 @ 11:11PM|#
          “…It’s obvious the ‘spontaneous’ movements of market actors can’t plan for shit,…”

          Yep, all that increase in prosperity since the Chi Coms let the market loose is, well, and absolute mystery to ignoramuses, right, ignoramus?
          And the increase in prosperity since Malthus claimed “WE’RE ALL GONNA DIE!”, well that just must have been done by some government taking care of things for us, right, ignoramus?
          Do you have any comment to add that isn’t the result of some ignorant view of history, ignoramus?
          Ya know, your shit substituting for your brains seems to feed your fantasies, ignoramus.

  20. They’ve always had a big government wing.

  21. Enough already…

    I’m getting dizzy spinning in my grave. Didn’t you read anything I wrote 30 years ago?

    MNG…I’m gonna give you a nuggie when I see you…

  22. You can export whatever you used it in, but you must manufacture it in China.

  23. As long as we’re talking about Russian Roulette, why don’t we talk about how deficit spending is the government essentially gambling that the American people will somehow how have enough wealth in the future to pay off massive amounts of debt?

    So what happens if the markets keep sloping downward and never recover?

    Not to mention it’s shooting ourselves in the foot and enslaving our children…

  24. I like making fun of brain-deads as much as any libertarian, and stupid non-sequitors from them are at the top of my list.

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  37. Well said. Tucker is despicable, Crossfire became despicable (despite the presence of supposed “heavyweights” like Novack and Carville), and Jon Stewart is a comedian who has never proclaimed himself to be anything else. Just because certain people here don’t understand how satire works doesn’t change that fact. The fact that The Daily Show has gained some cultural traction doesn’t change that. ???? ????? ?????? ???????

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  39. What does that have to do with the oil industry though? The oil industry is over 90% government-owned. The subsidizing of oil started a long time ago with backroom deals between Standard Oil and government-built railroads. BP was a public company until the 90’s. Oil companies and the entire oil-based energy system has nothing to do with capitalism or free market principles. It is based on socialist principles. When there’s a limited resource then get the politician in your commie central government, whether a dem or repub, to start bombing a country that has the resource you need. That’s how the system has worked for 100 years. BP is a perfect example. 100% government-owned, ???? ????? ?????? ???? ??????? ???? ????? ????? ??????? a complete failure in the free market a century ago until Churchill convinced the government to buy it and then supported with interventionist actions like Operation Ajax. Forget trying to apply free market principles to figuring out how the oil industry works, you do better to make comparisons to how other socialist programs work.

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