Monday, January 26, 2009

The Depletion of Finite Natural Resources

The depletion of finite natural resources like coal and oil also follows the exponential pattern described by Professor Bartlett. The IRS recognizes this depletion as analogous to the depreciation of plant and equipment and therefore allows certain related tax deductions. That natural resources are finite is undeniable. There may be some limited new discoveries in the future but in the end the recoverable world and U.S. reserves are limited and will ultimately be fully depleted or used up.

Many scientists believe fossil fuels are the primary cause of environmental pollution and climate change. This is a second good reason for seeking alternative fuels and energy sources while pursuing a vigorous conservation program and a stable population. One question raised by the recent election is whether we should develop all potential alternate energy sources simultaneously as a bridge to the future, or instead, focus our efforts solely on the development of clean energy sources? Because the State’s environmental problems and population seem to be increasing rapidly accompanied by perennial disastrous forest fires, mud slides, and fuchtbares wetter (generally foul weather), California Governor Arnold Schwarzenegger has initiated a very ambitious alternative energy and conservation program. He admits that to achieve his goals will probably require re-thinking California’s current ban on nuclear power plant construction and a significant state investment in solar conversions for those who cannot afford them.

Professor Bartlett wrote about the exponential depletion of oil and coal, relying in part on the work of Dr. M. King Hubbert, a geophysicist now retired from the United States Geological Survey, a world authority on the estimation of energy resources and on the prediction of their patterns of discovery and depletion. Bartlett observed that “we have the vague feeling that oil from Alaska and from beneath the Arctic ice cap will greatly reduce our dependence on foreign oil. During the recent presidential election campaign, we heard politicians speaking at length of the need for energy self-sufficiency in the U.S….” Republicans have urged drilling in all the offshore areas where there are proven or prospective oil deposits, not to perpetuate our output of carbon pollutants, but to assure that we have adequate bridging energy sources and the petrochemicals needed to restore our economy and keep it moving forward. Democrats prefer to focus almost entirely on the development of renewable energy sources. While commendable, this approach places our economy in some degree of jeopardy financially if we have to continue to buy petroleum on the world market and the price returns to the peaks of a few months ago. Few believe alternative energy and chemical sources can be developed on a timely basis to meet all our needs. How many airplanes will be able to fly on wind or solar energy? How much chemical fertilizer will come from the air and the sun? In the minds of many the shortage can be "solved" by congressional action in the manner in which we "solve" social and political problems. Many people seem comfortably confident that the problem is being dealt with by experts who understand it. However, when one sees the great hardships that people suffered in the Northeastern U.S. in January 1977 because of the shortage of fossil fuels and the rolling blackouts in California, one may begin to wonder about the long-range wisdom of the way that our society has developed.

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