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MOSLER'S LAW: There is no financial crisis so deep that a sufficiently large tax cut or spending increase cannot deal with it.

Energy crisis ‘solution’

Posted by Sada Mosler on May 22nd, 2008


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Interesting no one even mentions anything close to my proposal:

Lower the national speed limit to 30 mph for private ground transportation.

    That would:

    • Directly cut gasoline consumption as vehicles are far more fuel efficient at 30 mph than 60 mph.
    • Directly cut air and other pollutions.
    • Reduce long distance driving due to time constraints
    • Increase the demand for public transportation due to time savings issues
    • Reduce the needed safety features as you can’t hurt yourself all that much at 30 mph
    • Lead to much smaller cars and therefore better ‘packaging’ in the cities, reducing traffic and parking demands
    • Change relative real estate values currently distorted by relatively cheap fuel

    The reduction in consumption could be up to 5 million bpd in the US alone, which would:

    • Provide the net supply shock capable of reducing crude and refined product prices
    • Improve our real terms of trade and restore our quality of life
    • Increase national security by reducing dependence on foreign oil
    • Slow environmental degradation

    It’s a political choice- ration by price as we are currently doing, or use other methods, some of which we already do, such as fuel economy standards.

    This proposal simply adds the price of ‘time’ to burning gasoline for all private transportation, thereby making fuel efficient, cleaner, less resource intensive, alternative transportation more attractive.

    Feel free to try to make it happen if you agree!


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    30 Responses to “Energy crisis ‘solution’”

    1. jcmccutcheon Says:

      I’d hypothesize, and I’m sure you’d agree this would never fly politically. Is their an equivalent fuel efficiency mandate number?

      Reply

      John O'Connell Reply:

      @jcmccutcheon,

      In the days of the 55 mph speed limit, it was said that the best fuel efficiency occurs at about 40 mph. So, a fuel efficiency standard suited to 30 mph would also work for a speed higher than 40, probably about 50 mph or so.

      Unless there is new data, 40 would do more of all the good things that 30 does, and less of the uncomfortable things (like an even deeper depression of suburban real estate.)

      Reply

    2. jcmccutcheon Says:

      BTW, I heard Ed Shultz who is one of those left-leaning talk radio guys,
      mention we should go back to 55 mph.

      Reply

    3. warren mosler Says:

      won’t make a dent or cause anyone to switch to public transportation

      Reply

    4. warren mosler Says:

      no equiv fuel efficiency number as that wouldn’t move people to public transportation, reduce safety equipment, save 25,000 lives a year, etc.

      Reply

    5. jcmccutcheon Says:

      Michael Masters quote from todays testimony.
      “If wall street concocted a scheme whereby investors bought large amounts of pharmaceutical drugs and medical devices in order to profit from the resulting increase in prices making these essential items unaffordable to sick and dying people, society would justly
      be outraged”

      Nice touch! You have a hand that one?

      Reply

    6. warren mosler Says:

      that was mikes example. he sent his drafts to me for suggestions. a made a few that got in. i’d been discussing this with him for several years and my ‘enter the dragon’ write up was used some for reference, but he did the real work and added the swaps loophole.

      however, i thought the effect had crested in the summer of 06, and that from then on the driving force for prices was saudi oil pricing, and that crude would overperform the other commodities, particularly the industrial metals. Yes, the fund buying is helping support prices some, and is supporting forward prices, but the supply responses are there in the industrial metals though not food/crude where the saudis rule.

      also, a while back i wrote how paulson/bush/bernanke had deliberately started a stampede out of the $ with generally inflationary consequences and falling real terms of trade/standard of living as the US shifts to an export economy.

      by the way, several years ago i also started writing about how biofuels would link food to fuel, and trigger the largest humanitarian disaster of all time.

      last summer i also thought a 70′s style inflation would most likely keep the fed from cutting rates regardless of weakness. i was wrong on that call, as i overestimated the fed’s grasp of monetary operations. now it seems they are back ‘on track’ as ‘normal’ central bankers, but too early to tell.

      Reply

    7. tt92807 Says:

      I am in general agreement that we need to mandate higher fuel efficiency for transportation. I also think agressive investments into new energy technologies should be made, such as EEStor’s ultra-capacitors, whoch could power a purely electric vehicle for about 500 miles at a cost per mile of under $1 (http://en.wikipedia.org/wiki/EEstor).

      Regarding the 30 MPH speed limit, though, are you referring to within municipalities, or for long-haul driving? If we did that for long-haul driving, wouldn’t this create infrastructure problems? For example, given that for any major metro in the US, most food is trucked in, and also given a specific consumption need of food per day (x number of people eating x amount of food), then reducing the speed of delivery increases time to delivery and, given the same number of shipping units (trucks), reduces the amount of product deliverable per day. So, it would seem to me that in order to compensate, shippers would need to actually put more trucks on the road, which would end up erasing any value you got out of the reduction in speed by adding more fuel consumption across the shipping ‘units’ needed to deliver the required products.

      Reply

    8. warren mosler Says:

      I was including long haul.

      better mpg means even with more trucks there is less fuel burned as the same number of miles will be driven. A lot safer, too.

      this would also increase use of rail for freight if time is an issue.

      Reply

    9. tt92618 Says:

      I think we’ve painted ourselves into a corner in the US. First, we’ve allowed our national transportation infrastructure to fall into serious disrepair. While once rail lines crisscrossed this country, now only major freight lines remain, and access into remote regions by rail is all but impossible, thus making trucking required. Second, we have neglected public transportation in our cities, which in many cases forces people to drive.

      In Japan, every city of any size has a comprehensive rail system, and a city bus system, that makes getting around the city reasonably easy. These systems are in turn coupled to between city systems. So, you have an arrangement that goes like this: origination > city bus > city rail > inter-city rail < city rail < city bus < destination. In contrast, major US cities have a patchwork of marginally interconnected services that are not comprehensive and which therefore prevent serious use. Some major US cities have no rail system at all. Example: there is a regional rail transport station about 1 mile from the office where I work, and several of my colleagues use it to commute from perhaps 30 or 40 miles away. You would think that would be great for them, but no. Why? Because the city bus service does not offer service to and from the rail station, so they have to walk the 1 mile distance from the station to work. Cab service is almost non-existent, so in fact a group of them teamed up and bought a used car which they simply leave parked to drive back and forth to the rail station. Even so, the whole adventure takes hours out of their day, which brings me to my next point.

      Urban sprawl is a huge problem in the US. In Europe and Japan, city centers are denser, and travel between home and work is easier across shorter distances. In contrast, the LA metro area is more than 140 miles from top to bottom. I once lived about 18 miles from my workplace, and I calculated the time it would take me to get from home to work using city bus service or the train. Transit time came out to an astounding 1.46 hours per direction. Is it any wonder why most Americans opt to drive?

      My point in all this is to acknowledge the extreme infrastructure deficits we have in the United States that would work against any significant change to national speed limits in the US. I don’t doubt that it would save fuel… but my guess is that things would have to become very ugly before our government would ever enact such austere measures… if for no other reason than the fact that our cities and transportation systems would simply be unable to deal with the ramifications.

      My suspicion is that we will simply blunder on as we have been until such time that things get really bad, or until somebody gets extremely rich with an alternative technology that is rapidly adoptable. In either scenario the whole thing becomes moot, really. In the first case, we will be in such poor shape that speed will be the last thing on anybody’s mind; who cares about speed limit when 20% of the population is unemployed and nobody can afford to buy basic foodstuffs? In the second case, the technology will have ‘saved us’.

      Based on my observation of congressional behavior, and this is admittedly conjecture… but it seems to me that there is an assumption that we will find technological solutions to these problems.

      What do you think?

      Oh, hey – one bright spot: in the LA metro area, we have already enacted the maximum speed limit of 30MPH on many of our major roads for much of the day, and we did it completely by accident. :-)

      Reply

    10. Warren Mosler Says:

      a 30mph limit will save fuel, and a lot of it
      it will also result in more ‘time efficient’ public transportation

      i agree the chances are slim to none, unless/until things get a lot worse

      Reply

    11. jcmccutcheon Says:

      Soros testified today and said institutional investment in oil is the
      new elephant in the room.

      Reply

    12. warren mosler Says:

      he’s maybe three years late.

      that was the case when crude was in contango and saudi output was maxed out at near 11 million bpd

      saudis are setting price now, with output at about 9.5 million bpd

      Reply

    13. Ted Says:

      Simply solution. Adopt the Boone Pickens plan. As someone who is in the energy business, natural gas and coal, I am certain the Pickens plan will work! It’s time to get Washington moving on it. Peak oil is just around the corner. Don’t let the fall in petro prices this fall fool you, the world is running out of oil fast. RE: Matthew Simmons wonderful book. Read it.

      Reply

    14. warren mosler Says:

      Yes, nat gas got us out of the similar bind in the late 70′s as deregulation allowed conversion to nat gas from petro at our utilities.

      this time around converting cars to something else might do the trick, at least for a while. Seems to pluggable hybrids are a lot closer than nat gas conversion, and people will like hardly going to the filling station at all (plugins) vs going more often for nat gas.

      But even with both it will take a long time and the total reduction in gasoline (not total energy) consumption can easily be accomodated by an opec production cut, which means they remain price setter.

      Reply

    15. Zarepheth Says:

      As I understand it, most automobiles are designed and manufactured to reach maximum fuel efficiency (distance per unit fuel) in the 55 mph to 65 mph range.

      It is unfortunate, but our society has had inexpensive access to energy and automobiles for so long, our nation’s entire transportation infrastructure has evolved assuming those two things will remain inexpensive forever. Any change which significantly increases energy expenses or makes automobile travel difficult and time consuming will cause serious harm to large portions of our population.

      People already living more than 30 minutes drive at an average 60 mph from their work place will have their commute extended beyond an hour each way. This will put extra strain on personal health and family relationships. Those already living an hour or more from their work places are likely to lose their jobs and the ability to pay their debts and taxes. Inner city housing prices will go through the roof while suburban housing prices decline. Renters in the city will lose their homes as rents increase faster than pay; large numbers of suburban dwellers will find their homes “upside” down in value and be highly tempted to walk away from their mortgages – it will make the sub-prime mortgage debacle look like a cake-walk.

      I totally agree that this will make a very strong demand for public transportation, but will it actually be created and implemented before serious problems occur?

      Reply

    16. Uno Says:

      Have you been spending too much time in your golf car? :-)

      Whould not simply taxing gas up to $5-$6 per gallon result in the same?

      When tax went over $4 per gallon retail, people started to make real decisions buying smaller cars and moving close to work from the way-out burbs.

      If we had a sustained $5-$6 per gallon gas for 5-10 years we would all be driving 100mpg cars.

      Your plan would also require a re-design of cities, which is not a bad thing but kind of some like the Segway guy – a Segway goes about 30 mph.

      I would support policy that would eliminate the America suburb as we know it today – driving 5 miles to a Starbucks and Costco type thing.

      Europe is of course much better designed for the future because it was designed in the past, before the automobile.

      We need a new vision for the American suburb, a new main street that is a balance between efficient city living and absurd way-out suburbian life.

      Reply

      Tom Hickey Reply:

      We need a new vision for the American suburb, a new main street that is a balance between efficient city living and absurd way-out suburbian life.

      The bulldozer.

      Suburbs are incredibly inefficient. The US uses 25% of the world’s energy and only has about 5% of the population.

      Suburbs are designed for growth driven by excessive consumption, which depends on rising housing prices and increasing debt. That business model is unsustainable, and the US is going to have to just get over it.

      Reply

    17. warren mosler Says:

      the US highway system and relatively cheap gasoline is the foundation for our oil addiction and out sized resource consumption.

      getting it built was a masterful stroke by and for the auto companies

      Reply

      beowulf Reply:

      Tearing up the trolley lines didn’t hurt either.
      http://www.huffingtonpost.com/harvey-wasserman/gm-must-re-make-the-mass_b_144154.html

      Reply

    18. Butch Busselle Says:

      A- Doesn’t leave much room for your sports car.
      B- I guess I’d be collecting more tickets…
      C- So Ike’s defense strategies were minor a consideration?

      Reply

      WARREN MOSLER Reply:

      The MT gets 30mpg at 55mph. :)

      I never liked how he treated Tina anyway…

      Reply

    19. nystockguru Says:

      http://nystockguru.com/natgasresearchreport(nystockguru.com).htm

      The above report was created for my brother who is in the process of getting his chemical / molecular engineering p.h.d.

      It proposes a net economic gain (globally) by utilizing natural gas in transportation specifically shipping instead of gasoline (which is responsible for 1/3 of gasoline used every year in the US)

      Reply

    20. RJ Says:

      “Lower the national speed limit to 30 mph for private ground transportation”.

      I take it this is not a serious proposal?

      Reply

      WARREN MOSLER Reply:

      it’s an option for cutting our fuel consumption in half or more in short order, in case we ever give that high enough priority.

      Reply

      Clonal Antibody Reply:

      @WARREN MOSLER,

      There was this very interesting idea that also cropped up – Off the rails: mag-lev personal rapid transit

      This is in context for Australia, but will work for the US as well

      I am a Norwegian control systems lecturer recently back from a ten-month sabbatical in Newcastle. I have had one-year stays in Australia on two earlier occasions. My first stint was in Sydney 1997-98. I then experienced the city’s grave congestion and environmental problems due to car traffic. Thirteen years later it is even worse.

      I have also tried the very slow railway service between Newcastle and Sydney. It hasn’t improved either. From 1997 I remember the debates about intercity high-speed rail and magnetic levitation trains. But this didn’t lead to anything.

      Today however, there exists a new and proven – but largely unknown – technology that in one go can solve both the in-city and intercity transportation problems, and it is much cheaper than high-speed rail. That technology is maglev-based personal rapid transit (M-PRT). Computer-controlled small two-person streamlined pods run on a guideway six meters above gound. The guideway is carried by utility poles. The structure is very slender and much less intrusive than the Sydney monorail, because each pod weighs maximum 300 kg. It may be quickly erected along some main thoroughfares, and gradually extended to create a dense city network. One will not anymore depend on a few large stations, but can instead access the system at any of the many hundreds of network nodes (resembling elevated bus stops) you will have in a city like Sydney. A pod hangs under the guideway, and slides along it without wheels and no contact; an extension of the pod inside the guideway levitates it by magnetic repulsion. This is a new, simpler and cheaper type of maglev technology than that used in the very expensive German Transrapid, which was part of the Australian debate in 1997.

      Reply

      Clonal Antibody Reply:

      @Clonal Antibody,

      Here is a paper about it – Renewable Energy Use Advantages of Maglev-Based Personal Rapid Transit

      Abstract: Maglev personal rapid transit (MPRT) is a personal rapid transit (PRT) system that uses renewable energy in usage, distribution, and generation. A PRT system provides on-demand service in a manner similar to the automobile. Different types of PRT have different impacts on the electrical grid load. Recent advances in power electronics and maglev technology allow for the design of a novel MPRT system characterized not only by exceptionally low power requirements but also by a unique capacity to incorporate energy distribution and storage infrastructure into the greater transportation architecture. A hypothetical hybrid MPRT design incorporating energy storage and transmission capabilities is described. In addition, thorough carbon dioxide and cost analyses are undertaken to more fully understand the spectrum of benefits of an MPRT solution, in comparison to conventional vehicle and plug-in hybrid electric vehicle approaches. An MPRT system not only offers significant advantages over other technologies in efficiently using renewable energy but also represents the unique potential to address urgent energy challenges by incorporating power transmission, storage, and generation infrastructure.

      WARREN MOSLER Reply:

      sounds good!

      RJ Reply:

      @WARREN MOSLER,

      But it is a proposal that will never get off the ground. And could be used to discredit (or put people off) MMT.

      Energy is a contentious issue that might be best avoided on a site like this. It’s an area where reason and common sense has flown out the window. This will eventually settle down but until it does it might be best to avoid this topic completely.

      There are many sites addressing these issues and a lot of heated discussion. People from both sides might be attracted to MMT though.

      Reply

    21. Gary Surdyke Says:

      If 30mph is good then 15mph, better yet make everybody ride bicycles for commuting. Get Real.

      Reply

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