May 22, 2008

When in Doubt, Blame the Supplier

I'm always amused at the Kabuki theatre of hauling the oil execs before Congress. It's indicative of a couple things besides the obvious fact that politicians are more interested in being perceived as doing something rather than actually doing something. I think it indicates:

  • The economic illiteracy of much of the country. People don't understand the dynamics of commodity prices in a free market and think oil executives are setting the gas prices. If so, they sure didn't do a very good job during the '80s & '90s when gas prices were low.

  • That much pain - whether economic or physical or mental - seems mostly relative to what we are used to. The reason gas is a huge bugaboo is that it fluctuates. Taxes are infinitely more expensive than gas, but because taxes stay (relatively) stable, we don't complain much. The old story about the frog who will die happily in water that slowly heats to a boil illustrates a truth - we can more easily take pain when it comes gradually. But free markets can fluctuate wildly - witness stock market fluctuations.

    Republicans are using the issue to complain about liberal thwartings of other drillings, which is true, but upon reflection that seems to be just putting off the inevitable. A more powerful argument is how Democrat politicians have thwarted nuclear energy and how both parties have failed to fund alternative energy.

    Democracies are like publicly-traded companies - they are not good as good at planning for the long-term as passing the next earnings report, that is election. Which is why Medicare, Social Security are going bankrupt and we don't have a plan in place for the predictable-as-punch fact of oil supply not keeping up with demand. And additional drilling will never keep up with demand given the numbers of Chinese and Indians.

    My obsessiveness for planning may be part of being a computer programmer, a profession in which disaster is only a bug away. See this:
    What is even more interesting is that it illustrates the difference between computer programmers (homo logicus) and the rest of the human race. Programmers like to have to plan for all edge cases. They think that anyone that doesn't is careless or lazy.
    It bothers me that our energy "plan" is to solve the problem only when it becomes too painful not to.
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