Letters for Monday • May 15, 2006

• When biologists speak on economics

• Can zoning be changed back?

• Alternative energy vs. cheap energy


When biologists speak on economics

Whenever a biologist pretends to be an expert in economics you can be sure of one thing: nonsense.

And that is mostly what has been delivered by The Garden Island’s two articles on the Asquith lectures given at the NTBG. For instance, Asquith says

“… better drilling and exploration technology makes for faster extraction, which further drives down supply.”

Sorry, but better exploration and extraction technology increases supply and over the long run will tend to reduce costs. Even if Asquith meant oil reserves and not supply he is still wrong.

Here’s what a U.S. Energy Information Administration 2002 report says, “At year-2000 consumption rates, the world has many thousands of years of crude oil and crude oil substitutes (heavy oil, oil sands, and oil shale) remaining.”

So assuming that for the foreseeable future consumption rates of oil rise it is still safe to say that we have at least a thousand years worth of oil left.

Moreover, and contrary to Asquith’s claim, technological innovation and innate human creativity has worked, does work and will always work. The growth in knowledge and technology will lead not only to more oil and better, more efficient ways of finding, extracting and using it but to economical alternative sources of energy. It is without this growth in technology and knowledge that the costs of retrieving oil will increase substantially — just the opposite of Asquith’s claim.

Asquith is no more accurate when it comes to food production. Hawaii has never been “independent” when it comes to food production, yet none of us has ever starved — even after the disruptions caused by several severe hurricanes. It seems that biologists in general are afflicted with the tendency to exaggeration and fear-mongering founded on faulty analysis and zero knowledge of economics.

For example, one of his ilk, fellow biologist Paul Ehrlich, in his book “The Population Bomb” says: “The battle to feed all of humanity is over. In the 1970s and 1980s hundreds of millions of people will starve to death in spite of any crash programs embarked upon now. At this late date nothing can prevent a substantial increase in the world death rate.”

The biologists’ ignorance of economics is further illustrated: In 1980, economist Julian Simon and Ehrlich decided to put their money where their predictions were. Ehrlich had been predicting massive shortages in various natural resources for decades, while Simon claimed natural resources were infinite.

Simon offered Ehrlich a bet centered on the market price of metals. Ehrlich would pick a quantity of any five metals he liked worth $1,000 in 1980. If the 1990 price of the metals, after adjusting for inflation, was more than $1,000 (i.e. the metals became more scarce), Ehrlich would win. If, however, the value of the metals after inflation was less than $1,000 (i.e. the metals became less scare), Simon would win. The loser would mail the winner a check for the change in price.

Ehrlich agreed to the bet, and chose copper, chrome, nickel, tin and tungsten. By 1990, all five metals were below their inflation-adjusted price level in 1980. Ehrlich lost the bet and sent Simon a check for $576.07. Prices of the metals chosen by Ehrlich fell so much that Simon would have won the bet even if the prices hadn’t been adjusted for inflation.

Asquith’s gloomy predictions are simply regurgitations of a discredited Ehrlich and some new ones tailored just for Hawai‘i. The real problem with oil production lies with the environmentalist driven regulations and restrictions imposed by state and federal agencies and legislatures that have restricted exploration and extraction of oil and thereby driven up the associated costs. The same regulations have blocked the construction of new refineries thus crippling the ability of oil companies to produce more in the face of increasing demand.

  • RS Weir
    Kapa‘ai

Can zoning be changed back?

I found Mr. Furfaro’s article of May 12 (Seeking Solutions, The Garden Island) interesting and informative.

Perhaps some of our traffic and population problems should be blamed on past councils. I read regularly where the council has changed the zoning on properties so they may be developed either to single or multi-family housing. Perhaps someone can inform me, do we have an ordinance that prohibits reversing the zoning from multi-family development?

Do our ordinances require that the Planning Commission and the County Council approve any development that has been zoned commercial or for multi family? Not being an attorney, I would think that any zoning from any time frame could be reversed while denying a development request until our traffic problem has been solved.

As for me, I would strongly support any candidate both verbally and financially that would pledge to oppose approval of any large development until our traffic problems are alleviated. At the rate we’re going that would be years. Perhaps in the next election we can elect a council that will have more preference for the island than for the developers.

  • Bob Yount
    Koloai

Alternative energy vs. cheap energy

I am sometimes shocked by the thinking of people that claim to be pro alternative energy. For some, alternative energy should be evaluated first and foremost in terms of whether or not it will provide cheaper energy than fossil fuels. This is provincial, non-progressive (and I don’t mean that in the political sense) thinking. Insisting on cheaper energy at the outset has the following three adverse affects (there may be more):

• You deprive yourself of the environmental benefits of going to a clean energy source while you wait for the technology and economies of scale to advance to the point where cheaper is possible.

• Alternative energy companies lose that important sales revenue, part of which would have gone into research and development to improve the technology to make the product cheaper (and I have no doubt this would happen, because this is the way technology advances).

• You leave yourself open to the vicissitudes of the oil market.

There are other, more appropriate ways to decrease the monetary impact of your energy needs than requiring energy providers to lower prices.

Conserve. Trade in that gas-guzzling SUV or monster truck for something more fuel efficient. You can’t rightfully complain that your bills are too high if you can’t control your consumption.

We really need to be taking our cues from Brazil on this issue. During the oil crisis in the 1970s, they had the bright idea that they needed to develop their own source of fuel — hence, the birth of their ethanol from sugarcane program. And by all accounts, it was not an easy go at first — it wasn’t even widely popular. That vision is paying off big time for them now, though — they are estimating that they will be completely self-reliant for their energy needs within a few years (if not already). By contrast, the United States is still bandying about ideas like the Strategic Oil Reserve and drilling for oil in the Alaskan wilderness. Provincial thinking. Quite disgusting, actually.

  • Michael Mann
    Ele‘elei
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