BP Dismisses “Peak Oil” Concerns

The interesting thing to me about the “are we running out of oil” debate is that those who know the most about the oil business and with the most at stake in the answer - the major investor-owned oil companies - by and large aren’t worried. The further away you get from the oil producers themselves, the more you encounter worriers.

In that vein, it’s worth reading this summary of BP CEO’s John Browne’s interview with Der Spiegel that appeared yesterday. The only investor-owned oil company that I am aware of that has any substantial disagreement with Browne’s analysis is Chevron. But then again, Chevron is relatively terrible at finding oil compared to their competitors, so perhaps their worries about depletion are handy rationales for poor past performance.

By the way, I wrote an essay on oil depletion for Chevron’s “Will You Join Us?” webpage when it was initially launched, but, alas, it hasn’t seemed to change Chevron’s mind much.

Motion to Dismiss this Lawsuit … With Extreme Prejudice!

Item: Criminal brings lawsuit against John Q. Citizens for defending themselves.

Nonlawyers are quick to ask, “Can he really do that?!”

Let me attempt a quick answer:

Any person can sue any other person for anything. You can file a lawsuit against a newborn baby for “disturbing the peace” in a park. But there is a legal mechanism to dispose of meritless lawsuits without a trial or even a preliminary hearing–it’s called a motion to dismiss. And a motion to dismiss with prejudice will bar the litigant from bringing such an action again. When law students learn about the motion to dismiss with prejudice, their textbook should illustrate the concept by mentioning the case of the criminal who tried to sue his victims.

On the general subject of self-defense, we should all remember this gem from Colorado Sheriff Bill Masters: “It is your responsibility to protect yourself and your family from criminals. If you rely on the government for protection, you are going to be at least disappointed and at worst injured or killed.”

More on self-defense here. To listen to a talk that Masters gave at Cato, click here.

Income Inequality and Social Unrest: What’s Their Function?

The current debate on Cato Unbound, particularly today’s contribution from economist Edward E. Leamer, circles around the danger that income inequality poses to political stability.

Leamer argues that computer technology amplifies innate talent differences, and hence will widen existing income disparities. This seems undeniable. He then goes on to imply that this is necessarily a threat to political stability or social harmony. But is it?

Leamer’s unstated assumption is that there is a simple monotonic relationship between income disparities and social unrest. That is certainly a reasonable hypothesis, but it is not the only such hypothesis.

Isn’t it also possible that the relationship is more complex, and multivariate? It seems at least worth investigating the possibility that the relationship between income inequality and political instability is asymptotic – that the richer and richer Bill Gates becomes, the less impact any further increase in his income will have.

More importantly, isn’t it also worth considering the possibility that there are other variables in the equation besides income inequality; for example, the sufficiency of the incomes earned by those in the lowest quartile of the earnings distribution. If the poorest quarter of citizens were destitute, that would seem more socially destabilizing than if they could comfortably feed, clothe, and house themselves and their families – regardless of the incomes of the rich. Someone able to live comfortably might not care if the richest citizens double their incomes tomorrow, whereas someone who is barely scraping by might resent even the most modest increase in the incomes of the rich.

So perhaps the seemingly inevitable increase in income inequality will not pose a threat to social stability, so long as those with the least marketable skills can still earn a comfortable living.

It would be interesting to see a natural experiment conducted to test this theory using historical data.

The American Meddling Association

The American Medical Association has long ceased to be a serious advocate for doctors. It instead has become a propaganda arm for the wackier factions of the public health movement. The Chicago Sun Times reports that at its annual meeting this week, the AMA is considering throwing its support behind a move to tax soda sales, with proceeds going to various anti-obesity measures. This, despite little evidence that soda consumption is linked to weight gain (non-diet soda consumption has remained virtually unchanged since 1988). Not to mention the fact that if we’ve learned anything about sin taxes, it’s that they’re inevitably used for projects far removed from those educational programs promised when they’re enacted.

The soda tax endorsement comes on the heels of the AMA’s embarassing attempt to pass off a web-based survey (which the organization later admitted was an “advocacy” tool) about alcohol consumption as scientific research, complete with a fake margin of error. Last year, the same organization and its president expressed shock that – gasp! – most minors get their first taste of alcohol from… their parents. Seems to me that the supervising eye of a parent would be the ideal circumstance under which a minor would get his first sip of beer or wine, wouldn’t it?

Consider these other action items from the agenda for the AMA’s annual meeting this week:

  • Support a 50 percent reduction in salt in processed foods, fast foods and restaurant meals over the next decade.
  • Oppose beer ads on college sports broadcasts.
  • Prepare a report summarizing video game research, including emotional and behavioral effects and addictive potential.
  • Push to ban smoking in all public places and workplaces.
  • Support mandatory school instruction on the dangers of Internet pornography.

Meanwhile, as it continues to tell parents how to raise their children, and push for government regulation of private behavior, the AMA has been conspicuously silent, passive, or just plain wrong on issues you’d think would be high-priority for a group that claims to represent doctors: The relentless DEA campaign against doctors who specialize in pain management, for example. Pain activists say the AMA has been AWOL. And not only didn’t the AMA oppose many of the more onerous HIPAA regulations, it lobbied for their enforcement. The organization has also taken a relatively passive stance of the federal prohibition on medical marijuana, which puts political drug eradication goals ahead of patient care.

The AMA’s percentage of revenue from membership dues has fallen over the last few years. It now counts just 26% of U.S. physicians among its dues-paying members.

Given the organization’s priorities, I can see why. Journalists should keep that figure in mind when reporting on official AMA positions. The group certainly doesn’t represent the opinion of all doctors. Of, for that matter, even a majority of them.

Why Do We Spend So Much on Defense?

Reuters alerts us to the new report from the Stockholm International Peace Research Institute, which includes a workup on global military expenditures. A few key findings:

World military expenditure in 2005 presents a real terms increase of 3.4 per cent since 2004, and of 34 per cent over the 10-year period 1996–2005. The USA, responsible for about 80 per cent of the increase in 2005, is the principal determinant of the current world trend, and its military expenditure now accounts for almost half of the world total.

[…]

The USA is responsible for 48 per cent of the world total, distantly followed by the UK, France, Japan and China with 4–5 per cent each.(emphasis mine)

The USA is today unchallenged in our hemisphere, and we enjoy friendly relations with almost all great powers in the world, depending on one’s perspective on where the US-China situation is headed. Fighting terrorism the right way–with bolstered intelligence cooperation, small-scale special forces activities and cooperation with our allies–is actually quite cheap.

But we still spend nearly as much on defense as the rest of the world combined. Why? If the threat of terrorism doesn’t justify such massive expenditures, what on Earth are we so afraid of?

There isn’t a good answer. Moreover, even this enormous level of expenditure doesn’t seem to be turning the Bush administration’s ambitious foreign policy aspirations into reality, and the unfortunate mismatch between means and ends is on display daily in Iraq. The thing to do, of course, would be to acknowledge the limits of military power, quickly pull our foreign policy goals into line with our national interests, and stop trying to reshape the culture and politics of faraway peoples that we don’t understand, and who don’t threaten us. Unfortunately, such a correction doesn’t seem to be in the offing.

For a useful and thoughtful critique of US defense spending, see this PA by my former colleague Chuck Pena.