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One of the live oaks that bless my home

Saturday, April 23, 2011

How to Make Some Sense Out of So Much Nonsense?

For most people the Big Recession of 2009 has never ended.  It has not ended as well for elementary schools, middle schools, high schools, colleges, universities, museums, policemen, firefighters, municipalities, counties, states, and so on.

This recession has not ended, yet we see inflation in every aspect of the lives of ordinary people: fuels, food (even the food-like edible substances that masquerade as food in the U.S.), and clothing.

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There is a reason why food and fuels are excluded from the government measure of "core" inflation, which then becomes a game of controlling how fast we print and price new money relative to how fast we improve productivity.  Over the last several decades, the Federal Reserve has become quite good in playing that control game, and the rest seemed OK.  But not this time.

So what is different now? Why do the Left and the Right offer such dramatically different solutions to the same problem?  Are they both wrong?  Or are they right some of the time and wrong otherwise in explaining the different parts of the same complex story? Is anything missing from these contradictory explanations?

Yes, I think that a lot is missing from all leading explanations.  First of all, perhaps for the first time in our democracy, our leaders and leading intellectuals are essentially relying on keeping people confused.  This puts us on the opposite side of the moon from the attitude of Thomas Jefferson, Benjamin Franklin, Thomas Paine, and so on, who did their best to explain their thinking clearly to all. When these great men lived, the Earth surely seemed infinite.

The next presidential campaign will focus on confusing the confused even further, and swaying their votes based on raw emotions, not their self-interest and thoughtful choices.  Mark my words, and observe the obfuscation and deceit unfolding in all media, and in Google that digests them in a certain way that may no longer serve the public interest.

The main reason why I am making this bold prediction is as follows:
This time around, it is rather important to explain carefully to the public what is going on. However, no one who is inside a political system can fully explain what is going on by using arguments from within that system.  And it makes no difference if they are on the left or the right. 
In mathematics, this essential unexplainability is addressed by the two Incompleteness Theorems by Kurt Gödel:  The first incompleteness theorem states that no consistent system of axioms whose theorems can be listed by an "effective procedure" (essentially, a computer program) is capable of proving all facts about the natural numbers. For any such system, there will always be statements about the natural numbers that are true, but that are unprovable within the system. The second incompleteness theorem shows that if such a system is also capable of proving certain basic facts about the natural numbers, then one particular arithmetic truth the system cannot prove is the consistency of the system itself.

In translation, one needs to step outside of a given system of axioms to see from the outside what is possible within that system and what is not.  This profound truth has eluded some of the best minds around, including Bertrand Russell.

So how far do we need to step outside of the current system of myths that are fact to most?   Not that far, it turns out.  All we need to do is to admit that the Earth is finite, her resources are finite, and the current "economic" system cannot grow overall.  In the U.S., the economic system has reached the maximum attainable complexity and must undergo a simplification.

That's it.  Now you see why it is impossible for most to understand and explain what is going on. If you want to feel a little better, you may read an incomplete financial explanation of the current mega-confusion by a former insider, David Stockman.


Roughly equal amounts of matter and antimatter are created in the collision of energetic gold nuclei, but because the fireball expands and cools quickly, antimatter can survive long enough to be detected. An ordinary helium-4 nucleus (background) is here matched by a nucleus of antihelium-4 (foreground). Think of the political left and right.

P.S.  Since the impossibility of an "overall economic growth" is so utterly alien to my fellow Americans, let me explain.  When one part of our economy grows, another one will shrink; if both parts grow, another economy shrinks (the Chinese economy?).  When I make a profit, you will pay for it with a loss. I may share a part of my profit by offering you a job, or I may buy gold bricks.  When we extract "value" from destroying our environment, our children will die sooner after more miserable lives. And so on.

Wednesday, April 20, 2011

The Macondo Well Anniversary

At noon today I was asked by the Austin Chapter of Sierra Club to do a joint interview on the first anniversary of the Macondo well tragedy.  This is what I said:


Tad Patzek, Remarks at the 4/20/2011 media event organized by Sierra Club
Noon Press Event at 11th & Congress in Austin. 

For full disclosure l need to tell you that I am Chairman of the first-ranked petroleum engineering department in the country, and I am very proud of it.  I have not come here to bash oil, because hydrocarbons, oil and natural gas, as well as coal, have underwritten both the industrial revolution and the scientific revolution that have produced the wind turbines and solar photovoltaics, as well as all components of the electric cars we all like so much.  Without fossil fuels, all modern renewable energy sources would be dead before arrival.

Because the real production rate of liquid petroleum is peaking and the imaginary additions are unlikely to make up for the rate deficit, the world, but especially the developed countries, and above all the U.S., will face the inevitable shortages of liquid transportation fuels. For the completely unprepared U.S., such shortages may be economically devastating. The U.S. is running out of time to move much of its transportation off the cars and trucks and onto rails that will guide electric trains of different kinds, not just the sexy and prohibitively costly "bullet trains."

Everybody gathered here - despite our own best personal efforts - will gulp today four gallons of hydrocarbons; and tomorrow another four gallons, and then four gallons each day thereafter.  Please try to drink four gallons of water in a day to see how much liquid this really is. We all need to go on a miracle hydrocarbon diet.

In my mind, it is irresponsible to bash hydrocarbons, while deriving from them most everything we are today.  It is also totally irresponsible to waste hydrocarbons wantonly as we do every day, here in Austin, and everywhere across our beautiful country.  These hydrocarbons are absolutely needed to underwrite moving to any other energy source to one degree or another.  They are also needed to underwrite an economic recovery, if there is to be one in the U.S., in the years to come.

Hopefully, I will not be disturb you if I tell you that wind power has delivered 6 days of electricity in the U.S.; biomass burning with electricity cogeneration, 5 days; geothermal sources, 1 day; and solar photovoltaics a little more than 1 hour.  The remaining 354 days of electricity that might one day charge our electric cars come from coal, natural gas, nuclear power, and hydropower (in that order).  In addition, our freedom from foreign and domestic crude oil, when satisfied by domestic biofuels, may last for up to 10 days per year of driving the U.S. transportation systems. Then we’ll all be walking for the remaining 355 days.

So the real question is not how many more wind turbines and solar cells we will install in order to change nothing in our lifestyles, but how we change our lifestyles for real.

Texas already leads the U.S. in wind power, with name plate capacity of almost 10 gigawatts, more than thrice that of California. On average, wind power generates in Texas over 3 gigawatts of electricity, twice the 1.6 gigawatts generated by the Fayette Power Project.  This is a huge achievement, but I do not see too many elected officials clamoring to build those transmission lines to deliver the much needed – and wasted - wind electricity to Austin, Houston, Dallas and San Antonio.  I also do not see mass demonstrations and outbursts of legislative fervor in favor of a train link between Dripping Springs, downtown and Georgetown.  While Austin has made a huge progress in building the more energy-efficient houses, most single family homes here are woefully inadequate when it comes to energy efficiency. Where are the requirements for each new home to have a rainwater tank?  Where do we think we will get all the water needed to keep Austin green and happy?  How about growing more local food and buying it as well?

My challenge to Austin and to Texas is to observe the first anniversary of the Macondo tragedy not by bashing crude oil we all gulp ad nauseam every day, but by striving to gulp a little less oil, and do more with the oil we gulp.  We need to wake up to the fact that we all are co-conspirators here and we all share blame for this horrific accident, not just the big bad oil companies. After all, it is we, who indulge in the crude oil drinking binges every day, not just the oil industry employees.

So what are the two main lessons from the Macondo well tragedy? One is that we need to be a lot more careful in how we drill and produce oil and gas reservoirs in the most difficult and inhospitable environment on Earth — the deep ocean. The second lesson is that we have to snap out of our stupor and realize that the time of cheap gasoline and sprawling suburbs accessible only by car is coming to an inevitable end, no matter what anyone says. This second lesson has not been learned yet.