Centerfield

Who said there was nothing good about socialist ideas? And it works for Alaska....

LOL Tully...

It works so well for Alaska that their powerful Senators have managed to keep the cheapest and most affordable natural gas pipeline from being built.

That said...it's Iraq's oil. It's their country and the profits belong to them. But frankly that's not far enough. They also need to be in charge of who rebuilds their country and how it's done. Not likely to happen under the current US regime.

The point of her article, which I read, was not so much to advocate socialism or redistribution of wealth, but to prevent Iraq from falling into the pitfalls of other oil countries, such as Saudi Arabia, in which the presence of oil revenues encourages corruption in government and stagnation in the economy which becomes totally dependent on oil. As I recall the article, she was really advocating the distribution as a way of ensuring that the economy becomes more balanced and to encourage individual initiative and entrepreneurship. The points that Brian make are correct, but the article is really aiming at the problems endemic to the other oil rich countries that, despite their riches, have wretched economies. Of course, it's unlikely that the Bushies would retreat from their economic orthodoxy enough to allow something like this (unless there were votes in it somewhere).

I'm not sure what the point of Carla's comment is other than to criticize the occupation. Birdsall was not saying anything about the merits of the invasion. To say Iraq should be in charge of who rebuilds the country has nothing to do with the article and with the post. And, frankly, how excited would Carla be about letting the Iraqis handle the rebuilding if they decided to something weird, like forcing women out of the workplace to make room for men. I'm not saying Carla is necessarily wrong, but we need to think through the implications of what we say.

Socialism? How is it socialism?

Giving money that is rightgully theirs directly to the people? I like it! What they should not do is give the revenue to government to create a bunch of programs that may or may not work.

This does not change the fact, however, that it should be a policy goal of this country to make the use of fossil fuels extinct (foreign or domestic), and to expand on and create other energy alternatives by eliminating the unfair market advantage that oil companies currently have.

"This does not change the fact, however, that it should be a policy goal of this country to make the use of fossil fuels extinct (foreign or domestic), and to expand on and create other energy alternatives by eliminating the unfair market advantage that oil companies currently have."

Mathew,

I find it interesting that you would take this position. You seem to be saying that the government should (presumably though taxing or some such mechanism) eliminate the price advantage that fossil fuels currently have over other energy sources. This is a lot farther than even most liberal economists would go. In theory, there is no such thing as an "unfair" market advantage, except to the extent that companies can somehow prevent the market for exercising correcting (such as through cartel-like behavior or government-conferred monopolies). Most mainstream economists would argue that the market is, to some extent at least, efficient and self-correcting in that supply and demand factors will push resources toward their most efficient uses. That's the basis of comparative economics. What you seem to be advocating, if I understand what you are saying, is that government take actions to influence the market resource allocation decisions. The most obvious way to do this would be to sharply increase gasoline taxes to make other energy sources more competitive. This is a tract that the Carter Administration tried (remember synfuels?), but it is certainly not something that this administration would endorse.

I disagree that the oil companies have an "unfair" market advantage. The market is what it is. Fossil fuels currently have a cost advantage over other potential fuels plus the technology may not exist yet to use these other fuels effiicently.

I'm frankly skeptical about the ability of government to effectively intervene. At some point, presumably, as fossil fuels become more scarce (and politically more tenuous), other renewable sources will become economically viable.

I do agree, however, that we do need to raise gasoline taxes and increase MPG standards, especially for SUVs, for conservation and environmental reasons.

To say Iraq should be in charge of who rebuilds the country has nothing to do with the article and with the post. And, frankly, how excited would Carla be about letting the Iraqis handle the rebuilding if they decided to something weird, like forcing women out of the workplace to make room for men. I'm not saying Carla is necessarily wrong, but we need to think through the implications of what we say.

I wasn't so much commenting on Birdsall's piece as I was moving toward the natural progression such a move as "giving Iraqis control of the oil" entails. Why should they not be allowed to control the resources of their own country?

In terms of Iraqis making decisions that I (or Bush, for that matter) might have a personal beef with...those sorts of things should have been taken into consideration by the administration before they decided to invade and occupy the country. Are we planning to make Iraq the 51st state or are we going to allow them sovereignty?

I agree with Mathew (thud) that the money belongs to the Iraqis. But if the Iraqis choose to cede some of it to their government for "a bunch of programs that may or may not work", so be it. The decisions about the direction of their nation should be theirs, not ours.

MWS,

That is not what I am saying at all, although after re-reading my post I can see how you thought that.

I think the unfair marketing advantage exists through corporate welfare, if you will. The truth is, oil's success has to do with a lot of things but one of those things is government preference through tax breaks, subsidies, etc. I simply believe the market should decide. We should eliminate the preference, and make oil compete on it's own. Some will argue that even then oil will win out and be the dominant force, but my feeling is that over time the market's desire for alternatives will grow, and we will start seing the private sector focus more R&D on creating cleaner and more efficient energy sources, and in some respects we already have. The more the private sector plays the more we will see other energy alternatives begin to compete.

I admit that I have been a bit of a hypocrite on this one, in a way, and have said things like we should give car company's tax breaks to develop fuel cell technology, but I have come to believe that as long as we are limiting options to any one source we are prohibiting creativity, and if your goal is to develop the safest and cleanest alternative you really need to allow for a consideration of all possibilities. One of the problems in this area is everybody has got their favorite (i.e. nuclear, fuel cells, etc.), but government shouldn't let itself get caught in that trap.

Also... I consider myself to be an environmentalist. There is no argument that will convince me that oil is in anyway a good thing. I believe we should push for government to adopt higher efficiency standards and things of that sort which will also create a need in the market to develop cleaner and safer alternatives to
fossil fuel. The other benefits of this of course is that by increasing regulation of fossil fuel sources, we will lower the demand and therefore the price at the gas pump.

This has nothing to do with the Iraq issue of course. The bottom line is that I like ideas that make the population there wealthier, and if oil is a way to do it for now, then I am all for it. That been said, I hope that any country would look at oil as a revenue source for anything other than the short term, and in my opinion the United States has an interest into pushing itself and the rest of the world toward to doing just that.

Wow Carla,

That was a loud thud!

Socialism? How is it socialism? Giving money that is rightfully theirs directly to the people? I like it! What they should not do is give the revenue to government to create a bunch of programs that may or may not work.

[Begin tongue-in-cheek mode]

But Mathew, that oil's not "rightfully theirs." It belongs to the French and the Russians, who bribed for it fair and square. They have pretty papers signed by Saddam Hussein and everything! Recent ones, no more than a couple of years old! So of course confiscating it for "the people" is socialistically redistributionist, a flagrant violation of property rights....

[End tongue-in-cheek mode]

I agree--pass the profits directly on to the people of Iraq pro rata, and the Iraqi government can find out how much of it they're willing to give back in the form of taxes for public works. But they'll get more in taxes if it goes through the people to the government rather than vice versa, and Iraqis would be better off.

I meant to say that I hope countries WILL NOT look at oil as anything other than a short term revenue source.

France and Russia! France and Russia!

(Begin tongue and cheek mode)

I think Bush should announce that they have taken satelite pictures and discovered WMD's in Paris and Moscow... The bombing begins in five minutes.

(End tongue and cheek mode)

That was a joke!

Mathew:

I think the thud from your joke was louder then the thud from my fainting spell over agreeing with you.

Don't quit your day job. :)

Shouldn't the extent to which we worry about the burning of fossil fuels depend on our best estimates of whether, environmentally speaking, god gave us enough rope to hang ourselves? I 've spent time looking at estimates of remaining fossil fuel reserves, and though they vary, there are some obvious order of magnitude limits on how much we could possibly have left. I think it's a fair assumption that one way or the other we're going to burn just about all the fossil fuels we have, sooner or later.

So of course it makes sense to look at what kind of damage this will cause to the environment, but in a context which understands that eventually we won't be able to keep doing it, because we're going to run out some day. Which will focus our vision quite effectively on energy sources which we right now have the luxury of viewing as "alternatives."

I am highly skeptical of the notion that we'll globally "choose" to stop using fossil fuels and opt for more expensive alternatives by using governments and treaties etcetera to subvert market forces. Just by its nature, the market takes into account SO MANY factors that treaties and government policies cannot. I'm not saying "do nothing," I'm just saying, let's not go off half-cocked and enact policies and treaties that may well screw up a bunch of nation's economies, especially ours.

I'm OK with gradually removing subsidies where they exist as long as we think they won't send energy prices through the roof. The thing is, if subsidies are encouraging supply at a certain level, and their removal makes extraction of some resources economically unattractive, then one way or the other, the removal of subsidies makes energy prices higher.

Some people are WAY too blithe about this. Good, it will encourage conservation, they say as they mutter sanctimoniously at SUV drivers. The thing is, rising energy prices trickle through the costs of so many other things. Like anything transported or manufactured. Some of you out there aren't old enough to have lived through an economy beset by even moderate inflation. It's no walk in the park, let me tell you. So I'm leery of removing subsidies quickly or drastically. If we do it, we need to do it carefully, with our eyes wide open. I am more sanguine on the idea of funding basic and applied research.

I'm not at all dismissing conservation. It must have a role. But to me the bottom line is that we will continue to need energy, and probably lots of it regardless of how well we manage and conserve resources. We are going to have to make a transition to other sources because folks, the meter's running. And the extent to which the transition hurts everyone is going to depend on how well we have the technology for new sources working when the old spring starts to run dry.