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Can we get off oil now?

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oil drumsHow many wars, deaths, recessions and environmental disasters will it take before Americans, and their Congress, finally make a decisive move to reduce the country’s dependence on oil? We are in a decade-long war in Iraq because of oil. We are still reeling from the worst recession in 80 years because of oil. Last summer the worst environmental disaster of our time took place in the Gulf of Mexico because of oil. Now, after two and a half years of trying to dig out of the recession, oil price hikes threaten to knock us right back down into that hole. And I haven’t even mentioned the air pollution and climate change caused by burning oil.

Crude oil prices have jumped to roughly $100 a barrel because of serious political uprisings in northern Africa and the Middle East. The success of protestors in Egypt fanned the flames of unrest in Bahrain, an oil exporter, and in Libya, an oil exporter. International leaders are concerned about unrest in Saudi Arabia, which in essence controls the flow of oil through OPEC, which controls world oil prices, which heavily affect the U.S. economy. Even if an uprising is not likely in Saudi Arabia, the unrest in the region increases the possibility of terrorist acts against oil infrastructure there. In 2008, Al Qaeda attacked the Abqaiq oil processing facility in Saudi Arabia, sending world oil prices climbing, at least for a while.

Eight of the top nine oil exporters are dictatorships or autocratic kingdoms, a control structure funded by our own dollars that is suddenly being shaken. And new leaders may be just as risky as the old ones. As R. James Woolsey, a former CIA director (and member of our advisory board) points out, a likely successor to Saudi Arabia’s King Abdullah is his half-brother and interior minister, Prince Nayef, a devout Wahhabi. It is Wahhabi institutions that train suicide bombers in Pakistan. U.S. leaders might have much more difficulty dealing with Nayef, who might also be less reluctant to restrict oil supply.

To be clear, the goal is to break U.S. addiction to oil, not just foreign oil. Oil prices are global, and as Woolsey points out, the U.S. has no domestic leverage. Greatly increasing our own offshore oil drilling could lower imports a little, but it won’t lower world prices; it is too easy for OPEC to manipulate production to offset the effects of any new U.S. supply.

The payoff of significantly reducing oil consumption would reach far beyond the economy and the environment, by the way. A study by Boyden Gray and Andrew Varcoe noted that oil companies are permitted under a waiver of the Clean Air Act to include known carcinogens such as benzene, toluene and xylene in gasoline, which raise octane (power output). The study showed that the added cost to healthcare and shortened lives in the U.S. comes to more than $100 billion a year.

The U.S. can take a number of steps to reduce oil consumption and to create liquid fuels that can substitute for oil.

Gasoline tax. The most direct way to reduce oil consumption is to raise its price. A gasoline tax keeps price high regardless of OPEC actions. In a recent New York Times column, Thomas Friedman proposed a $1-a-gallon gasoline tax, which would be phased in at five cents a month beginning in 2012. Announcing a delayed start, yet defining the phase-in, would give producers and consumers time to change their buying and investment habits before the tax kicks in. Friedman advocates that the money be used to reduce the deficit. Others say some of the money could be used to develop alternative liquid fuels, and some could be used to assist low-income families to offset rising home heating oil prices. The chief argument against a tax is higher prices, but as we saw in the 1970s, in the 2008 recession, and right now, oil prices are higher anyway. And tax money stays in the U.S., instead of higher crude payments that go overseas.

Crude oil tax. Some economists argue for a crude oil tax, rather than a gasoline tax. In February the RAND Corporation released a white paper in favor of a tax on crude oil (as well as imported, refined petroleum products). Taxing crude, at the refinery, spreads the burden across all taxpayers, not just motorists and truckers. RAND suggests linking the tax to price. For example, the tax rate would be 10 percent if crude were $120 a barrel, but 17 percent at $72 a barrel. This would keep prices high, and generate the same amount of tax revenue, regardless of OPEC attempts to reduce world prices to encourage greater consumption. Although critics say "now is not the time" to impose any kind of tax, there is never a good time; RAND notes that the federal gasoline tax, alone, has not risen in 18 years. The study also suggests that the money be used to maintain roads and bridges. If so, that could free up stimulus money or other infrastructure funding to support development of alternative fuels-or the tax could do that directly.

End oil subsidies. Economists and politicians claim that subsidies for renewable energy cloud those sources’ ability to compete on price alone. Well, U.S. oil companies receive billions of dollars each year in subsidies and tax breaks.

Raise fuel efficiency requirements. The Obama administration has succeeded in raising "mileage standards" a modest amount, but existing technology sitting on car-company research shelves is capable of doing much more. The standards can be raised further.

Encourage new hybrid vehicles. The new "extended range" hybrids like the Chevy Volt can cover up to 40 miles on batteries alone, without using their onboard gasoline engines, unlike traditional hybrids such as the Prius. Many, many people drive less than 40 miles a day. Putting millions of these hybrids on the road would switch the fuel source from oil to electricity. A valid concern is that the electricity would be generated by coal-fired power plants, but the technology to capture carbon dioxide emissions exists; it is far easier to control emissions from a few thousand power plants than from millions of tailpipes. And nuclear power and renewables can replace coal plants; they can’t replace gasoline engines.

Require gasoline vehicles to be "flexible fuel." Changing the materials used in a few minor car parts such as fuel lines allows them to run on nongasoline fuels such as ethanol and methanol. In a few short years Brazil has essentially changed over its entire inventory of commercial and consumer vehicles to flex fuel.

Switch fleet vehicles to natural gas. Converting hundreds of thousands of cars, vans and buses to natural gas is technically not difficult, and because they operate from central hubs, they can easily fill up on natural gas there; there would be no need for a nationwide network of natural gas stations. Furthermore, many short and even long-haul trucks could operate in the same manner if only a small number of natural gas stations were built along major interstate highways.

Fund more research. A number of "radical" energy technologies are being advanced that could directly replace liquid petroleum with other liquid fuels. Biofuels of all sorts are being attempted. The Energy Department’s ARPA-E program is funding a number of solar fuel projects, in which sunlight converts carbon dioxide and water into hydrogen fuel. Sandia National Laboratories, schools such as the University of Minnesota, and start-up companies such as Sun Catalytix and Liquid Light are all on the task. ARPA-E is also funding unusual but promising automobile engine designs such as wave-disk engines that are smaller and lighter yet double the fuel efficiency of the equivalent internal combustion engine, which could dramatically reduce gasoline consumption.

American men and women die in Middle Eastern oil wars. American families lose their homes and lose their jobs due to oil recessions. Americans of all ages and incomes lose their health because of oil additives. American coastlines are ruined by oil spills. The level of human, economic and environmental harm inflicted by our oil dependence is absurd. Our unwillingness to act is even more absurd. How many more wars, deaths, recessions and disasters will it take before we make a move?


Image credit: © Henrik Jonsson Graphic Design


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  1. 1. ConcernedCitizen 1:23 pm 02/28/2011


    When you find an alternative that is less than 3x as expensive, let the rest of the world know.

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  2. 2. fyngyrz 1:56 pm 02/28/2011

    "Gasoline tax. The most direct way to reduce oil consumption is to raise its price."

    You mean, "The most direct way to screw the economy further into the ground is to raise its price."

    Good grief man, use your grey matter. Push electric vehicle development (hard: this is the #1 most important thing to do); push alternative power sources (meaning, anything but oil so that those vehicles, which will use less petroleum than today’s cars, can smoothly transition to non-petroleum power sources); push development of non-petroleum based lubricants, synthetics and so forth.

    But don’t advocate hurting the economy — specifically restricting travel, and therefore access to, and consumption of, products and services — in order to help the economy. That’s a really, really bad error.

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  3. 3. Michael Smith 2:09 pm 02/28/2011

    People will always come up with alleged reasons why they can’t significantly reduce oil usage. They think you need new technologies, an alternative fuel that doesn’t cost more, or that changes such as the inevitable gas tax would hurt the economy. But we already have the solution. Just use less. If you buy a car then get one that gets at least as good gas mileage as a Prius. Consolidate your trips. Use alternatives such as transit, bicycling, and walking whenever possible. When you are looking at moving to a new home make sure you are not going to be completely car dependent. Turn down your thermostat. Eat food that is less energy intensive. And support the gas tax so that your money stay in the US instead of propping up some overseas dictator.

    These changes are not difficult. But people have to quit making excuses and accept that making some changes is inevitable.

    And just think how much you will like these changes when you realize that conservation means saving money!

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  4. 4. flycaster 2:15 pm 02/28/2011

    The U.S. is reeling from the worst recession in 80 years because of the actions of Congressional Democrats that allowed Freddy Mac and Fanny Mae to run amok in providing home loans to those who could not afford them. Congressional Republicans and the Bush Administration relaxed SEC and financial regulations that allowed the creation of derivative junk bonds based on these bad loans. When these schemes finally collapsed, the recession began. A spike in oil prices during the recession didn’t help matters, but it did not create the recession. The author’s attempt at rewriting history to make his point is not appreciated.

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  5. 5. flycaster 2:24 pm 02/28/2011

    The world – and the U.S. – is awash in clean burning natural gas. No new technologies are needed to burn it in modern internal combustion engines. The Obama Administration could change the game overnight if it issued an executive order directing all federal agencies to purchase flex-fuel vehicles. The signal would be sent to the Middle East, and oil prices would plummet. As automakers developed a market for cars and trucks that can operate on natural gas, we could wean ourselves from oil. Infrastructure would grow to accommodate the new transport fuel, and homeowners with natural gas to their houses could "gas up" right in their own gargages. This is a policy idea that should be immediately explored. In addition, if electric vehicles are ever to work, nuclear power must be expanded dramatically. Only this will ensure the pollution savings promised by EVs. Such transportion powered by coal-fire power plants is not getting us anywhere in regard to pollution reductions.

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  6. 6. Sn0wman 2:47 pm 02/28/2011

    One ingenious thing we can do (which Tom Friedman has also mentioned) is to establish a gasoline price floor (ie $2.50 per gallon) below which the money would be refunded to the public in the form of a tax credit towards purchase of electric or plug in hybrid electric vehicles. Doing so would keep gas prices reasonably high thus not allowing OPEC and Big Oil to low ball electric cars out of business. Buying electric cars decreases gas demand which ultimately will drop gas prices. The lower gas prices go the more incentive there is to buy electric until pure gas driven cars are phased out.

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  7. 7. SmartyParts 2:50 pm 02/28/2011

    The nation’s electric grid can barely keep up with existing loads throughout the summer months. I think your recommendation needs to add significant dollars to beefing up our utilities if we are planning to plug in anything new on a grand scale. Still doable. Just insert additional $$$ to your proposals.

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  8. 8. mikeorgan1955 3:42 pm 02/28/2011

    Here are a few ideas not mantioned.
    1.Increase access to public transport
    2.Massive funding of Fuel Cell technology
    3.Encourage Oil companies and Motor Manufacturers to invest heavily in alternative energy usage/production
    4.More funding for Nuclear fusion technology to advance bringing this online within 20 years
    5.Stop the increase of out of town malls to rejuvenate the local shops and making millions of journeys unnecessary.
    6.Introduce a tax system that rewards those who buy local produce and punishes those who don’t therefore reducing food millage.

    All the above will have an effect on oil consumption is properly managed and also have the bonus of massive economic/environmental/social benefits.

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  9. 9. Donnie300 4:21 pm 02/28/2011

    Every local government can do more than any other group to decrease oil dependancy. No car gets good mileage sitting at red lights. It is possible to time traffic signals so that vehicles designed to get 30 mpg can do so. It doesn’t take anything more than common sense and an honest effort by city and county road commissions. It isn’t necessary to fund a study or form a committee or update equipment. Get out and drive your roads commissioners! If you have to stop at 6 lights to drive 2 miles – somethings wrong. 25 cars should never have to stop so 2 cars can leave Applebees or any other business. Fix your program! Government shouldn’t be mandating to anyone until it cleans up its own act.

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  10. 10. Forlornehope 4:28 pm 02/28/2011

    For a thorough discussion of this subject it is worth studying the monograph "Winning the Oild End Game" by Amory Lovins.

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  11. 11. Open Mind 4 a Different View 4:36 pm 02/28/2011

    Most of the congestion and excess fuel consumption is in major metropolitan areas. Each time the federal transportation bill has come up for reauthorization, state DOTs have built more and more highway capacity while congestion continues to grow at a faster rate. The problem, of course, is that we’re building the wrong stuff. Major capital project development, evalaution, and funding is heavily biased in favor of highways. Sure, highway are of value, but expanding thenm in heavily urbanized areas hasn’t been the right thing to do for a very long time.

    We need new and much improved transit options for heavily congested urban corridors. Real transit options. Not express bus running in mixed-traffic on shiny new HOV/HOT lanes, or on highway shoudlers, but *real* affordabel, reliable, and efficient options. These new and imporved transit options should be accompanied by congestion pricing on all existing freeway lanes. Revenue from pricing could fund both highway and transit capital and operations in the corridor where the revenues are collected. We also need to continue to change the rules of the project development, evaluation, and funding game such that transit receives proper consideration.

    We can’t simply bump up the price of gas, as that makes the cost of driving more expensive without providing alternatives to driving. Who can make the choice not to go to work? We can’t rely on alt fuel vehilces because their cost is high and infrastructure no widely available.

    Bottom line is that if we keep spending our federal transportation dollars the way we have been, we’ll keep gettin’ more of what we’ve been gettin’

    We all know that won’t work.

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  12. 12. JewelBarlow 4:42 pm 02/28/2011

    Flycaster is right on target. I almost quit reading after the third sentence which is completely off base about the most important cause of the recession.

    On the present topic of oil consumption, I believe we need to decrease our dependence on imported oil and we need to properly fund the upkeep and expansion of our highways and related infrastructure. Advances on both of those goals can be made by increasing gasoline taxes and devoting the proceeds to infrastructure upkeep and improvements. I have not made any attempt to calculate reasonable levels of taxation, but I suspect that gasoline taxes at the same percentage levels that were in place in the 1970′s would be a significant move in the right direction. Actions to increase the use of natural gas for transportation purposes and to displace oil as a building heating fuel should also be pursued immediately and vigorously. In the longer term (10 to 20 years) we need a major expansion of nuclear electric generating capacity. The primary need in the nuclear arena is for the government regulatory system to be made rational rather than just a massive road block.

    Our financial industry and approach to financing of residencies continues to need scrutiny and further changes, but that is another topic.

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  13. 13. NedC 4:54 pm 02/28/2011

    We need to favour moving people and goods over moving vehicles about which means higher taxes not only on gas but also on road usage and land usage. We really can’t afford the kind of suburban sprawl that has become the norm since the 1950s. The increased taxes can help pay for improvements in urban public transit and both freight and passenger rail systems as well as reclaiming farmland and new industrial development so that we can have shorter supply lines for food and many essential goods.

    Modern communications technology, particularly smart phones, makes dealing with urban mass transit networks much more convenient than it used to be, when I, a Detroiter, visit New York or Chicago, I find it very easy to navigate those cities’ transit networks thanks to Google Transit, but there is still much room for improvement including integrated payment via phone and live updates, real time demand tracking by transit agencies would allow a more efficient allocation of resources assuring more timely and comfortable travel for riders.

    And doesn’t walking or biking to work or the store make more sense than spending your time driving around from home to work to the big box store to and air-conditioned fitness centre or rural bicycle path for exercise.

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  14. 14. DougAlder 8:25 pm 02/28/2011

    Oil is used for much more than transportation. From
    <blockquote>A barrel of oil yields these refined products (percent of barrel):

    47% gasoline for use in automobiles 23% heating oil and diesel fuel 18% other products, which includes petrochemical feedstock-products derived from petroleum principally for the manufacturing of chemicals, synthetic rubber and plastics 10% jet fuel 4% propane 3% asphalt (Percentages equal more than 100 because of an approximately 5% processing gain from refining.)</blockquote>

    So there are a lot of alternatives to the non automotive uses. From geothermal energy for electricity (heating etc) to plastics from plant material.

    If your government were to stop massively subsidizing petroleum producers and petrochemical companies – supporting the very terrorist countries that so many of you rail on about – the cost for energy from oil would be equal to or higher than the alternatives. Those subsidies are coming directly out of your tax dollars.

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  15. 15. mrkettle 9:23 pm 02/28/2011

    We don’t so much have a congress as the oil companies have one. The best that money can buy, too!

    Getting off oil will be an American revolution.

    The range of types of people which the laws of evolution has created include those who exist to acquire power. It is these people who are motivated to control technology and they apply it to further their ends (see beginning of paragraph). If there is a benevolent overseer who would direct the applications of technologies , they operate by enabling us to see what is wrong and to fix it.

    Hope springs eternal from scientists who see the potential to improve the world and the lot of mankind. Dream on… but keep on trying to wake us up too. We all need to wise up, especially those in power. The more power, the more responsibility.

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  16. 16. BBHY 10:33 pm 02/28/2011

    "Can we get off oil now?"

    I did about two years ago, and I’m never going back. I don’t miss being BFFs with Exxon, Chevron and BP.

    I hope others decide to do the same, but if they don’t, then I really don’t want to hear the endless moaning and complaining about the evil oil companies and the how much money they’re spending at the pump.

    Get yourself an electric car, put up some solar panels, and start diving on sunshine. You’ll be glad you did! Have a nice day everybody.

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  17. 17. laurenra7 3:12 am 03/1/2011

    Spoken like one who has not even an elementary grasp of economics. Ever think that there’s a REASON we use oil so much? Or rather, thousands of reasons? It’s incredibly useful in a variety of ways and it’s a compact, inexpensive and efficient source of portable energy that has no peer just yet. Eventually we’ll transition to something else as a result of normal market pressures (translate: the way the REAL world works). Government intervention in that process historically has yielded results that range from ineffectual to disastrous. Care to explain the current wasteful ethanol subsidy that steals R&D money from other more promising replacement fuel technologies? Exactly. Government intervention. Let the market do its work and be patient already. Sheesh.

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  18. 18. phalaris 3:28 am 03/1/2011

    It’s amazing that so many people just won’t acknowledge the strategic argument for a significant crude oil tax, which is the only way to reduce this dangerous dependency.

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  19. 19. madbassoonist 10:03 am 03/1/2011

    The answer is blowing in the wind.

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  20. 20. gusviera 5:20 pm 03/1/2011

    I agree we need to get off oil. What angers me is that our politicians are owned by the oil companies. Whose going to break that tie?

    Gustavo A Viera CPA
    <a href="">Miami CPA</a>

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  21. 21. ennui 5:48 pm 03/1/2011

    How much of the oil is used for heating in percentage?
    That we can cut down to nothing by using the invention of Gravity Control to generate electric power.

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  22. 22. ennui 5:51 pm 03/1/2011

    If cars are using the most, yu should have one all-electric car, using normal batteries to drive back and from you rwork place. Use your gas guzzler when you go on a trip.
    Electric power can be generated very inexpensive by applying the Gravity Control system.

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  23. 23. ennui 5:55 pm 03/1/2011

    Dear Smarty,
    Gravity Control, my invention, will make it easy and rather inexpensive to generate power.

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  24. 24. sofistek 3:41 am 03/2/2011


    I don’t think you did get off oil. You have an electric car (built with oil). You have solar panels (built with oil). And, unless you are now totally self-sufficient, you take an active part in a society and economy that is totally dependent on oil.

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  25. 25. sofistek 3:44 am 03/2/2011

    Wow, how did you get through this article without mentioning peak oil? Why do you think unrest in Libya might cause oil prices to jump? Maybe it’s because production is already barely keeping up with demand and the easy cheap stuff is already at or past peak; remember that US oil production peaked in 1970.

    Switching cars to natural gas won’t make the US energy independent, since its natural gas production, even with the very expensive, and rapidly depleting, shale gas plays, is barely keeping up with demand. Add a new demand, and the US is still needing to import.

    Electric vehicles? Where does the extra electricity come from (and new electricity WILL be needed, for a variety of reasons)?

    "A number of "radical" energy technologies are being advanced that could directly replace liquid petroleum with other liquid fuels." No, they can’t directly replace liquid fuels because they don’t exist. Maybe they show the possibility of directly replacing petroleum (though I would doubt that a full analysis would show that) but they certainly can’t do it now. And biofuels are a pipedream. The US uses twice as much energy as is captured and converted by all of the biomass in the US, wild and cultivated.

    The only way to get energy independence, for any country, is to start living within the energy budget provided by the sun, and only so much as doesn’t affect the balance of the eco-system in which we live. All other ways may get independence for a while but are, ultimately, unsustainable.

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  26. 26. wyojohn 9:55 am 03/2/2011

    What does octane have to do with power output? What else does the author misunderstand?

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  27. 27. wyojohn 9:56 am 03/2/2011

    What does octane have to do with power output? What else does the author misunderstand?

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  28. 28. DavidButler 11:21 am 03/2/2011

    "Fund more research. A number of "radical" energy technologies are being advanced that could directly replace liquid petroleum with other liquid fuels. Biofuels of all sorts are being attempted."

    Biofuels have gotten a lot of negative attention recently because of the pressure that corn-based ethanol is putting on animal feed prices. There are some exciting possibilities for algae-based fuels that would not affect feed and food prices. Algae is especially interesting because of the possibility of creating a cyclical system involving heterotrophic and autotrophic species. Here is a blog post that I wrote about the potential for algae.

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  29. 29. bigbaddude 8:11 am 03/3/2011

    why did we not get off oil back in the 70′s?

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  30. 30. j.turbert 2:59 pm 03/3/2011

    I’m French , and last week I bought fuel for my (small) car : 6.8 US$ for a Gallon. With this small diesel car I need 2 Gallons for 100 miles. The tax is approx 75% of the gas price ! And in UK , Denmark, Netherlands its even more. New motors are more fuel effective and at the end, a car journey is not so expensive.

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  31. 31. Northernrambler 3:18 pm 03/3/2011

    If western nations which to reduce the consumption of oil it will take a massive shift in people’s thinking.
    Does anyone need a 1000 hp vehicle? Does any vehicle require a top speed in excess of 100 M/h? Taxing the oil or gasoline is not the answer as it taxes all consumers equally. The taxes should be on the vehicles, those that are truly fuel efficient would receive a tax credit, massive SUVs, large displacement engines should be taxed at 200% or more…
    Ban Nascar and all autoracing, or tax it to the max…
    Why is a small displacement, low sulfur diesel engine not available in North American vehicles?
    Bio-diesel is also an alternate fuel also.
    Americans prefer to have their son’s and daughter die in needless wars than give up their right to drive the biggest meanest vehicle they can imagine.
    Sadly this is the truth…

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  32. 32. Donald.Nagy 9:17 pm 03/3/2011

    As the author said: In a few short years – Brazil has essentially changed over its entire inventory of commercial and consumer vehicles to run on nongasoline fuels such as ethanol and methanol.

    This short time is about 12years. Why don’t we just copy the Brazilian success of not being non-dependent on foreign oil

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  33. 33. sfleck 12:37 am 03/4/2011

    A fine blog despite some of the reasonable objections. The writing was indelibly on the wall in 1973: reform the economy, or lose control of it to American big oil, Middle Eastern and other oil producers, and the like. But we’ve chosen to pretend that it’s just some graffiti or other.
    A flagrant lack of – or, often, rejection of – real leadership (remember John Anderson’s proposal of a modest gas tax being shouted down immediately as unAmerican?) has left us all prey to delusional economics, the idea that because we still manage to pay less at the pump than any other industrial nation we are still God’s chosen people, blessedly able to waste resources forever, despite what reality awaits us just outside the doors of our fool’s paradise. Our children will have a hard time forgiving us our heedless flight from reality. They’ll have little reason to do so if we don’t address this problem forthrightly – others are doing so far more realistically while we wish to avoid all sacrifice and … let the future pay.

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  34. 34. sbijapure 11:13 am 03/4/2011

    On "How many wars, deaths, recessions and environmental disasters will it take before Americans, and their Congress, finally make a decisive move to reduce the country’s dependence on oil? We are in a decade-long war in Iraq because of oil…."

    But reducing dependence on oil is not going to end the wars. Alexander the great fought without the need for oil.Craving for power and war are in human nature. If we are able to use solar energy more effectively we will get a lot of (nearly) free energy which will be very useful in more wars for domination.
    So if it is N number of deaths before we reduce our dependence on oil, then it is 2N number of deaths a year we get after we reduce dependence on oil.

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  35. 35. 2008RealityCheck 3:13 pm 03/4/2011

    Stop promoting food to fuel programs. Food soon will become the next shortage.

    Open up the oil fields in the US.

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  36. 36. jaded 2:35 pm 06/8/2011

    We’re all for curing our addiction to foreign oil, that is unless some will be personally inconvenienced, need to change some habits, and heaven forbid, suffer some temporary economic pain. So let’s continue to argue amongst ourselves and abdicate our responsibility to our nation’s well being by putting it in the hands of OPEC and others who clearly have our best interests at heart.

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