U.S. Consumers Get Cold Feet as Energy Costs Soar

[steve2470]

http://www.reuters.com/newsArticle.jhtml?type=reutersEdge&storyID=6571704

WASHINGTON (Reuters) - The surging cost of fuel oil and gasoline have set the stage for a cold, expensive winter in the United States and sparked concerns that consumers will cut spending, a move economists worry will hamper growth.

The chill of winter has already descended on Wisconsin, but Deidre May, a part-time hotel worker and divorced mother of five in this northern Midwest state, has yet to turn on the heat at home.

"I've purposefully kept the heat off because I know I can't afford to pay the bills right away," said May, a full-time Milwaukee college student with five daughters aged 6 to 19.

"I make sure the girls put on extra clothes, and keep them as bundled up as they can be at night," she said, adding she has cut back on car trips and activities for the kids to save money for when winter descends and the heating bill soars.
<snip>

[DebJ]

1. this type of thing will only increase as oil decreases

[tlcandie]

2. I'm looking forward to a future

when people do not have to do this ever again!!! :cry:

[aneerkoinos]

6. Have fun waiting

150 years to eternity. It's just starting, the end of fossile fuel based growth economy. The end of the American way of life.

So please wipe your nose and grow up. Other people need your help, need you to educate yourself, nobody needs your tears.

Harsh? Gotta be, sorry, cause that's the way it is.

[BeFree]

11. The end?

While that may be, the fact that the same fuel that cost 30% less a year ago is now prohibitively expensive today, is a sign of the miserable failure of this administration to tell the truth.

What is happening today is unadaultered greed, run rampant. Even if oil will run out in fifty years, there is no good reason for the 30% cost increase today.

Only if the oil companies and B*sh had warned of a coming increase in cost because of a depletion in reserves would they be blameless.

[aneerkoinos]

17. Cost increase, whom to blame?

There is all the reason for the 30% increase, and that is only the beginning, $180 dollars / barrel of crude is fair price according to some well informed estimates. Could go much higher if and when the dollar collapses. It is important to understand why, because all politicians, from left to right understand that all American voters (except few Greens) share the same unsaid priority, to be delivered cheap fuel, and no sane politician can expect to win if he does not acknowledge that truism, and so the change must come from below, by getting rid of the denial that natural resources are limited. But notice also that yesterday Bernacke from the Federal Reserve confirmed that the situation is caused by supply-demand crunch, and before that Romano Prodi from the European Commission confirmed that the problem is structural. Hedge-funds and the rest of them and what possible role they play, they are the symptom, not the disease.

So here goes, first take a look at this picture:


That is the first part, the geological part of the Peok Oil theory (google Hubbert's peak for more info). The production capacity goes along Gaussian curve, and that is well established theory and proven right by numerous historical examples, e.g. US PO in 1970. PO has got nothing to do with running out of oil (that will never happen in absolute sense), and everything to do with the fact that global production capability will start to decrease by about yearly 3% quite soon. ASPO model, shown in the picture, is just one of many, but the disagreement for the PO date is not very big between various models, only few years, and the exact date is not really essential. What is essential is the next part.

So here we come to the second part of the PO theory, the socio-economical part. I assume the laws of supply and demand are familiar to you, and you understand what will happen to commodity prices when the demand surpasses supply, especially fysically limited supply? That is what is happening now, the supply can't satisfy the increasing global demand, as the physical limit has been more or less reached and we have now arrived at what is called PO production plateau. So up up goes the price. Next task is to start thinking what are the implications of PO spesifically for the US, which uses 25% of all the oil production in the world and twise as much per capita as Europeans, and the implications for the (nearly) global growth based socio-economic model, model that is based on the unquestioned assumption of unlimited natural resources.

It is not an easy task (should you give up denial and think it through) because giving up everything one has been raised up to believe is not an easy task for us human beings. First you will probably go through a phase of anxiety, nightmeres, hopelessness, all kinds of negative feelings, before (if you find the strength and compassion in yourself) you start to think what you can do on your part to push the odds towards avoiding the worst scenarios.

In the PO discussion forums I see that the reaction of many Americans is to get ready to "run to the hills", hoarding food, guns and ammo to defend their stash against the hungry crowd. That is suicidal reaction, it is based on prediction that can be self-fulfilling. I hope that is not the reaction of the good people on DU, but that together with others they will start to educate themselves, share information and look for solutions based on community and feeling of solidarity.

[Rose Siding]

7. I share your hope

Kerry will commit to alt energy research but the task is daunting.

The woman and children in the article are suffering now.

[ClintonTyree]

3. It's not going to be a very Merry Christmas....................

for Corporate America's bottom line. Hell, it's not going to be a very Merry Christmas for anyone........except the rich. People are going to have to choose between, food, medicine and now fuel to keep them warm for the winter. Ain't life grand under a Republican Administration?

[aneerkoinos]

8. Everybody shares the blame

not only Republican Administration. And there may be small blessing in Bush's stupid policies, they are making some of the PO economical effects felt prematurely and waking up some people.

Corporate America can't save your society, you'll need to wake and educate yourselves and start working for sustainable way of life now, and ways to reach that as humanely as possible.

[Blue_Roses]

16. Looks like you need to take your own advice

Corporate America can't save your society, you'll need to wake and educate yourselves and start working for sustainable way of life now, and ways to reach that as humanely as possible.-

While in a "perfect world" we could just "wake up" and all would be fine,we could wipe our sleepy eyes and say it was all a bad dream, however, now that we know it's more than a bad dream and this "realistic world" we live in shows a much different picture, simplistic words don't cut it. When you have an administration that refuses--REFUSES--to use any type of energy other than the black gold that lines their pockets, then you do indeed have a serious "wake up" problem.

[aneerkoinos]

18. Blame-games

Blaming the admin that is beyond contempt or the fools that keep voting them will lead nowhere. This problem is beyond partisanship, both Repugs and Democrats are part of the problem, The American Way Of Life. Blaming others only takes energy, energy that needs to be channelled into positive actions, that are not divisive and fragmentary.

Sure you need to get rid of Big Oil interests and Military-Industrial Complex interests, but it is foolish to think that Kerry will do that for you. What you need is a grass roots movement that will make those destructive forces as irrelevant as possible by empowering local communities to find new creative, sustainable and collective solutions.

[aint_no_life_nowhere]

10. Merry BushMess To You DumpGump

Chimp's Nuts Roasting On An Open Fire
Cocaine Rotting Out His Nose
Quagmire killing goes on by the hour
Despite his strut in flightsuit clothes

Everybody knows a helicopter and missile strike
Helps make Halliburton's bottom line bright
Tiny Iraqi tots with their cities all aglow
Will find it hard to survive the night

They know more shock and awe are on the way
They know that Chimpy still has more Iraqis to slay
And every mother's child will stop to spy
To see if flightsuit chimpanzees again will fly

And so I'm offering this simple wish
To folks from one to ninety-two
Although it's been said many times many ways
Merry BushMess
Merry BushMess
Merry BushMess, George
Fuck You!

(I hope it's our last season of BushMess)

[Atman]

4. I just ordered the minimum 150 gallons

at $1.96

I need a new water pump for the car. Wont get it anytime soon.

I need to buy insulation. Ironically, I'm paying for oil instead.

I need to buy new computer equipment. Forget that.

This is money that WILL NOT be going into any part of the economy except Big Oil.

Fuck Bush/Cheney. Oil barron crooks. They'll be counting their money for years, whether we remove them or not. So we might as well kick their asses out.

[aneerkoinos]

9. Oil barron crooks

don't mind them, they just steal your attention from the real story. Which is the end of unsustainable growth based economy. There is only one choise, soft landing or hard landing. What do you choose?

[durablend]

22. Propane is even better...

Around $2.50-$3.00 a gallon (at least IT WAS) and they make sure you CAN'T conserve it. Use less, they gladly charge you more to make up for it, use more and you're obviously gonna pay. :mad:

But enough of this pessimism...we're TERNING THE CORNER! The economy is STRONG and getting STRONG :puke:

[goforit]

5. And these are the same people that will run out n vote for Bush.

:argh:

[The_Casual_Observer]

12. It isn't going to just be their feet that are cold when they can't pay

for the heating oil this winter. Bad enough that it costs double for that SUV now, add to that double for the oil and it's going to be a blue Christmas!

[boblynn]

13. I just bought a Pellet stove via Canada to help this winter

Very cool stove, it can burn wood pellets, corn and even cherry pits. It burns very clean. Expensive at 3k but will pay for itself with savings on my oil bill over the next few years. Manufacture is Dell-Point but there are many others,

[DeepModem Mom]

14. Imagine if a Democrat were in the WH, seeking re-election...

this situation would be an under-the-radar issue?

[Carolab]

15. Here I sit

in St. Paul, wearing my wool carcoat and two pairs of socks and it isn't even winter yet. We are NOT putting heat on until necessary. This is just ridiculous and I am worried about my elderly mother this winter.

[Sabriel]

21. My student is concerned about her grandparents

Her parents are dead, so she lives with them when she's not at college in WI). A neighbor told her last weekend that they only turn on the heat when she's home to visit! She can't help them, because she's on scholarships. I'm just sick about what's happening to people on low or fixed incomes. It ain't gonna be a pretty winter....

[ProfessorGAC]

19. Ummm. Check The Archives Folks

The economists just now have figured out that escalating fuel prices will dampen growth and expansion? I've been saying that, right here at DU, and at regional econ meetings since March! (You can check the archives, if you'd like to see for yourself.)

I just can't believe how many buffoons are in the economics community.

The Professor

[aneerkoinos]

20. Buffoons

"I just can't believe how many buffoons are in the economics community."

Are there anything else but buffoons in the named community?

In the Hierarchy of sciences (given that the Holy thing is survival) -logics beat -nomics six nil, eco- wise. Too bad the buffoons are trying their damnest to take all of us down with their closed-circuit theories, detached from the wider context of what is commonly referred to as "reality".

[ProfessorGAC]

23. I'm No Buffoon!

Hence the title of my post. Look right here at DU (or articles in arcance academic jounrals) for posts of mine that said the exact same thing that these "geniuses" are now seeing to be true.

There are a subset of economists who are considered technocratic by most, but who don't adhere to existing theories but revise those, debunk them, or develop their own, based upon what the data show really happens in a macroeconomy. I'm in that crowd.

The Professor

[aneerkoinos]

24. I hope so! :)

Sure, there are some respectable schools, like Ecological economics, who understand that energy is not a commodity, it's the basis of life. And that energy has also got something to do with the basic economical categories of 'labor', 'population growth' (limit of carrying capacity) etc. ;)

But come on! Anyone with half a brain understands that increasing value of energy is away from the material standard of living, so if getting that right is big achievement in the economist crowd, what a sorry crowd it is. :crazy: