Energy Costs

We are all feeling it at the pump, and many of us have changed our behavior or absorbed the cost. But this is not the heating season, and that will add more to the burden. Here is a table of heating oil futures:


Avoiding an explanation for the the index numbers, the gist is this: heating oil price has increased around 100 percent in the last year. 100 Percent.

This next table is for Natural Gas out of the New York Mercantile exchange:


This is cost per million BTU, the actual energy content. It shows a recent drop.

The other chart I will link to for it is too large; it is propane prices for the last 18 years. Relative stability until 2004, but over a 100 % increase since then. Ouch.

Essentially, the last several years have seen enormous increases. Most have been able to absorb the costs, though low income people haven't. This is crucial for our area. Living here is energy intensive for over half the year. Not everyone can adapt by throwing more wood in the stove however, and large institutions definitely cannot. Their budgets will truly hurt, and that impact will really start to hit home now. I would argue that efficiency investment should come first. Handing out cash to boondoggles like excelsior needed to end yesterday.

Rural School District transport costs.

Knowing the already existing troubles for the school districts in the area, fuel cost increases will play havoc with spread out districts. One of consolidation's truism's is that economies of scale will provide greater opportunities for children. Does the data support this? One of the few studies examining this shows it does not work for rural districts because transport costs do not allow the economy of scale solution to the problem; transport costs eat up the supposed savings. To quote from this study:"As the number of children per school multiplied five-fold between 1930 and 1996, the per pupil transportation cost actually doubled". What does this mean for our districts in the time of near 100% fuel price increases, both for transport and heating? What will the solution be for this area, already hit by other problems?

An old table. Yes, I know my tiny readership just ran or fell asleep. But being a scientist, I like numbers, for they tell us something. This is from the U.S. Department of Agriculture Economic Research Service from two years ago, with fuel around 2.50 a gallon. I use it for one reason, to show average rural miles driven. Then there is this:

It is an average fuel price graph from August 2007 to June of this year, courtesy of AAA. Rural area's simply have to use more fuel. This is especially important for our area's school districts, rural residents or lower income people. The important thing is the budget percentage transportation takes up as costs go up. Most are still in a daze over the increases, but are either changing behavior( smaller cars, driving less), or have simply absorbed the cost. But my worry is for institutions such as already struggling school districts, hospitals or government services. In many ways, these costs are fixed, and at what point does the child per mile transport cost overwhelm our school districts? It is in the next budget rounds this will take hold, and I do not envy anyone trying to solve it...I will look at home heating oil next....

And this is victory? ( No, just a little less violent)

One of the news themes yesterday, via administration and military spokesman(also called mouthpieces for propaganda) was " victory is within sight", with qualifications of course. So first to Juan Cole for a small but realistic run down of the latest daily violence in Iraq, where " bombings, assassinations and kidnappings (still)occur daily", oft ignored if no Americans are involved ( only Americans are human of course). An ignored piece about an ignored country was in the New York Times Magazine, former U.S. Afghan narcotics official Tom Schweich opines on Afghanistan's production of Heroin..,probably now the world's largest producer, and how the U.S. and other government's are ignoring it.

And this is success?

The great Cracker is destroyed:

For those of you not in the know, the great Eucharist cracker destruction is over. Observe the rusty nail through the wafer. P.Z. Myers has destroyed the body of Christ. The comments from religious loons are the scariest...read on here

I went biking tonight down the Mesabi Trail on the backside of Hibbing, hoping to find single track ( I prefer Mountain Biking). I did find some places, but not as much as I had hoped for. I did see some great views and alot of people riding though; Here is a shot of one view:

A gutsy column from Dennis Anderson in the Strib today. What he is referring to, is the LCCMR Conservation Plan; This will be overall guidance document for conservation in Minnesota. Unless you are a policy geek or interested in resources, do not try to read it. As a guidance document, it will speak of targeting resources, etc...etc... All kinds of vague pronouncements. From this agency policies, proposals and grant dollars will be targeted. But as Dennis Anderson points out, it fails in concrete action, and maintains much of the status quo. Having been a partial participant in the process, I can state that amazingly obvious items are left out. One is energy, which ultimately rules our lives; the vast majority is often wasted on such things as left on appliances, light bulbs and a million automobiles stuck in traffic, or people commuting 50 miles. There is much about biofuel goals, but nothing about the fundamental problem: reducing the inefficient miles driven by individuals in 4000 pound vehicles. Instead, we will subsidize our way to a destroyed landscape and bare soils to keep the cars going. Politics can also play a role. Taxpayer funded subsidies to such things as Excelsior energy, when simple, proven conservation measures such as insulation, LED or fluorescent bulbs, public transport and community design would nullify the need for an unproven, expensive and dirty gift to certain local elites via the public coffers. Forcing developers and planners to account for energy and transportation impacts ( oh my, the end of rampant subsidized suburbanization and strip malls). Or, realistically assessing the community impacts of extraction industries. Why the last one? Because extraction industries are temporary, but the effects on people and the environment aren't. If anyone understands this, it is us in the north. Our communities suffer at the whims of the world economy while the landscape is destroyed, and we are left holding the bill and the bag, the bag being overburden piles, pollution, a disturbed landscape and communities that suffer from the social implosion when it is all upended. Our cities, out townships and our rural places suffer. Very few of us can afford the lake places to escape to as do outsiders as prices go through the roof . Why is this important? Because what we allow now will decide what we have later. The cost plus boom of the 60's and 70's left us with over built communities, no resources and local officials suffering the delusion that all would be alright forever. In 1982, we paid for it, and we still pay for it now. And now, as we sell off lakeshore, fill wetlands, build roads to nowhere or handout millions to pie in the sky schemes (Excelsior) in an attempt to bolster communities built for one purpose: extraction. It is, ultimately, a political document, built to make goals and not offend those wanting cash and quick profits. It does not say, however, that we must state what the limits of space and behavior are, and that is the fundamental problem. If we continue to extract, fill, cut,drain, or plow over our best farm soils, or build our communities on unsustainable resources, we are left with what we have now: Horrifying suburbs like Coon Rapids; wasted, polluted landscapes like Redore outside of Hibbing, or devastated communities like rural St. Louis County suffering an economic depression with the end of logging. Only outsiders or businesses supplying tourists and cabin owners are able to reap the benefits, and those are minimal at best, with jobs that pay little, offering nothing for human development other than servitude to the arrogant wealthy. ( I have been a janitor, a nurses aide and a maintenance man so I know this well). Blaming environmentalists and others is blaming the weatherman for a tornado warning. The warning is not just about biodiversity or species, but about communities and what actually works,. When you sell your soul for 16 an hour and an atv, you will be chained to needing that forever, and is that minuscule payoff worth a a destroyed landscape where no one wants to live and community implosions when everything shuts down? That is what this document fails to address; nowhere does it say no. To anyone. It will direct grants to encourage natural shorelines, but nowhere will it say " shoreline alteration for development and access for pontoon boats will now be regulated", or " Wetland alteration other than fundamentally needed development will not be allowed."
It is statements like that which are needed.

In honor of KSTP's taxpayer protection happy funtime charade, I am going to remind them and everyone else of the rest of the state's help to good old Eagan, Minnesota( Northwest's Headquarters and our governor's hometown...oh my) a few years ago. Let's talk subsidies:

1989 MARCH: Gary Wilson and Al Checchi approach NWA about acquiring the company. Other investors make bids.

1989 JUNE: NWA agrees to sell to a group of investors including Wilson, Checchi, KLM Royal Dutch Airlines, and others for $3.65 billion.

1989 SEPTEMBER: NWA's CEO, Steve Rothmeier and several others resign and are replaced by Checchi and his team.

1991 MAY: Minnesota Governor Arne Carlson and Al Checchi announce a tentative agreement for the construction of two NWA maintenance bases in the state. Legislation passes authorizing public subsidies for NWA.

1991 DECEMBER: The Legislative Commission on Planning and Fiscal Policy approves, by a vote of 11-7, an $838 million financial assistance package for Northwest. The package consists of a loan of $270 million from the Metropolitan Airports Commission and more than $500 million in construction financing for maintenance bases in Duluth and Hibbing. The construction bonds are delayed by a lawsuit.

1992 MARCH: State officials sign a $761 million public financing package for NWA. The original $838 million figure is reduced for a number of reasons.

1992 APRIL: NWA receives the loan from the Metropolitan Airports Commission and gives half of the $270 million to Bankers Trust, its primary lender.

1992 NOVEMBER: NWA's six unions agree in principle to accept $900 million in employee concessions over the next 3 years. NWA seeks a $300 million loan. KLM Royal Dutch Airline, a part owner of NWA, and Bankers Trust, pledge $100 million if other lenders will commit to the rest.

1992 DECEMBER: NWA executives announce the final approval of a tentative $2.2 billion restructuring plan that includes a $250 million emergency loan, $340 million in debt deferral, and cancellation of $3.5 billion in orders for new aircraft. Industry experts say that cancellation of orders for new aircraft threatens the plans for construction of the maintenance bases.

1993 JANUARY: The final piece of the $2.2 billion financial restructuring plan is the concessions agreement with the unions. In return for concessions, NWA unions demand 80 percent equity in the company. More than 1000 NWA employees are laid off.

1993 SPRING: Concessions discussions continue between Northwest and the various unions.

1993 JUNE: NWA warns unions that it will file for Chapter 11 bankruptcy protection within two or three weeks if contract concessions are not promptly approved.

And, this was all about debt from a purchase; a shell game. Their troubles came from the debt from the purchase. Nothing else.

I will not add the rest of the almost two decades of subsidies the south metro has received from Minnesota taxpayers, or the U.S tax payers in the 2001 bailout.

Perhaps they can be quiet now.

This is rather funny...faith healing and cursing exist elsewhere than this continent. So hop on over to Rationalist International and see some fun and scary stuff. Two of them are challenges to people with supposed magic powers, a hypnotist and a tantra. Others show the dark side..threats, murders committed to satisfy bizarre and insane beliefs, attacks for religious reasons, all the usual craziness when mass irrationality exists.

Posted at Miskwaa today

Posted @http://neminndems.blogspot.com/

Babbitry: n. behavior characteristic of a self-satisfied middle-class person (also babbittry)

Boosterism: the act of "boosting," or promoting, one's town, city, or organization, with the goal of improving public perception of it

What kind of boom is this?

Going around the countryside in the last few weeks, it was obvious from a number of for sale signs that something happened recently affecting a whole lot of people. In certain range cities, the boosterism and worshipful praise of the coming boom are at nauseating levels, even for a cynic. This project, that project and other such blather. The typical money eating sociopaths showing up ( if there is one thing I have discovered about certain Range cities, it is they have refined nepotism and insularity to an art so refined it rivals the old Chinese imperial city). And, they are the very definition of Babbitry, a term long since forgotten but still oh so applicable. Sinclair Lewis' writing is still the truthful essence, from Elmer Gantry, and Babbitt to Arrowsmith. All should be required reading , especially for city councilors and mayors. I would add a new character, a combination Gantry and economic development consultant advocating TIF districts and stripmalls.

There is another matter. While some woo retailers and look to plat out land, there is another entire reality which seems to be in another world far removed from this candy mountain. This is the year 2008, and since 2001, the number of decent, stable jobs lost in the area is still down by the thousands. Ainsworth in Cook and Grand Rapids are long since shut down. Because of that, the logging industry looks like the old cliff divers on ABC's old Wide World of Sports. I hate to guess on what fuel costs are doing to the remainder when the main buyers are now on the regional outskirts and diesel is over four dollars a gallon. The rural economy is in the tank unless you are a lake property developer.Those still living there but commuting to other work will soon be crushed by fuel costs. LTV, a long since forgotten and hideous memory is still only 6 and 1/2 years removed. Despite the building, it still remains the fact that over 2000 once stable jobs disappeared in the last few years, and only the depression like early 80's can rival what has gone on. Yes, there are the projects being built and within view, but it remains that at best on a local regional scale there is still a long way to go just to replace what was last in those last several years. Any statement respecting growth should be viewed as wasted vapor. Growth would be defined as long term stability, not applicable in an area so utterly dependent on inherently unstable extraction industries. A few construction boomers with out of state license plates is not the solution.

This is one reason I hate boosterism. Boosters are usually the local elite, touting pet projects they often benefit from or working within the government structure and thus having stable incomes. They also ignore the reality of the locals forced to become Walmartians and living without healthcare while still eligible for public housing, often now commuting at four dollars a gallon due to ill designed cities.

So, the next time I am stuck in some meeting listening to the vacuous drivel which flows from their mouths, I am going to refer them to this speech from long ago...The Untold Delights of Duluth, but add whatever range city I happen to be in at the moment.

Essar and Minnesota Steel

I will give a general apology to anyone having to read this, for it will be confusing at best. This news is moving fast, and what happened two weeks( much less months) ago is no longer true. Essar's purchase of Esmark was denied by the USW, so it may no longer happen; most likely it will but with a delay or modification. Additionally, ArcelorMittal sold the Bethlehem works to the Russian firm OAO Severstal. Severstal has also made an offer to Esmark on a buyout that already has union approval. Remember this also: Essar bought Canadian firm Algoma steel at the same time they bought Minnesota Steel. Why am I writing all this useless drivel?

Twice last week I was told by construction workers they were sticking around because the deal was done and building begins in July. In short, rumor. No announcement. Nothing in the business press. No politicians and businessmen clamoring for the camera. Nothing. And nothing is the only thing happening. But the important thing to remember is they already have steel production capacity in North America. It appears that many have assumed that what was proposed is still going to happen. All I am saying is it may not..it may be only a mine to supply their other facilities. They went after Bethlehem hard and still want Esmark's other facilities . People: We are nothing but a butt pimple to these corporations. Do not plan your life around them.

For everyone assuming a steel plant will be built at Cooley ( Minnesota Steel), you need to see this. What this means in its entirety, only Essar knows, but it could have an effect on plans. You see, if you already own steel production capacity, and you already own the ore, why bother building another plant? This might be a makeup deal for this. What does that have to do with it...Essar bought ( not approved yet) Esmark...it awaits approval, but it looks like a make up deal for the fighting over Esmark...This is about market share people, and if you are sitting waiting for the gods of steel to make a decision, do not be stupid and have a backup plan.

Americans are the people who bulldoze fifty acres to build a house, then place a moose and eagle statue in their yard because they love nature...

This article in the Strib today reports on two U profs who warned that ethanol production would eventually affect the food supply. It came true, just much faster then was expected. In my field, natural resources, I have watched and wondered for years as I saw more of everything being used by us, and wondered, how long can this absurdity last? Those who do question such moronic tendencies as suburban development, or continually funding a transport system and culture where one person drives around in a four ton vehicle are viewed as some sort of evil naysayer worthy of witch burning, taking away the freedom of driving around in a large truck, spewing garbage, instilling pride in ignorance and all of this with a frigging Nascar sticker on the back. This is the attitude of someone who has never matured past the age of 16, arguably, and something I stopped understanding years ago. Here is the problem: Energy is a physical commodity, and if you have to expend more to get less, then the cost goes up. The U.S. peaked production long ago in 1970, and is not going to miraculously fall into a bunch of cheap, easy to refine light crude. It doesn't exist. No major fields have been found since the 1960's anywhere in the world, and the major fields are all post peak. All of them. The sands of Alberta require mining, steaming, solution, then refinement just to get it to us. The costs are twice what was predicted. I will neglect the hideous, ecosystem destroying mess they make. There are some fundamental problems in American society. For two generations now, people have become used to the idea of unlimited driving, unless you of course are very poor. We have built every system we have in transportation, housing and labor based on the idea that we can all drive wherever and whenever we want, that we can spin trucks around 24 hours day hauling plastic covered food goods 1500 miles apiece in unlimited quantities, and that this little Shangrila is going to last forever. It is embedded in our culture, where people, (mostly men)worship the sheer tonnage and inefficient horsepower of their particular vehicle, where a commute of 30 miles in 2 ton vehicles is considered normal, and weekends are spent blowing more fuel individually than an entire village in China has access to in one year, all unquestioningly and without the real price tag being paid. The question here is always: " How do we keep the cars going?", rather than, "how do we move people and goods efficiently and conveniently with the least energy?" It frightens many, because like a religious faith they cannot conceive of another way. It frightens engineers and planners because they know it would take 50 year to re-engineer this giant goat screw. It frightens economists, because they know the costs. So along came ethanol, nee alcohol, as the miracle cure. Farmers get more subsidy, and we do not owe the Arabs anything. There is a problem...it uses other resources also. Water. Soil. Energy. Carbohydrates, called food, which we have to convert. It is, in essence, casting away the last six inches of Midwest topsoil and entire aquifers so we can all drive 20 miles to work alone in a dodge magnum. Does anyone see the insanity in this? What was true for a half century is true no longer. The oil supplies this was built on are going and about to go forever, and everything to replace it with is more expensive, nastier, harder to refine, and there just isn't as much. There are no more Ghawar's. I do not expect this to change until we are squeezed even more, until fuel becomes such a chunk of people's income that they are forced to change, and an entire cultural shift takes place that sees a stock car race as a giant waste of resources..which it is. People have been sold a bill of goods...that we can live without communities, that we can drive endlessly around forever, and that we can have all the food we want shipped in from Chile..It is not real, never was, and it will not be here forever.

Credit to NPR, Melissa Bock for the picture...
I've been watching the local theaters hoping this drivel will not show up. After the climate change skeptic teenager on NPR ( which has now officially gone to crap), I suppose next we will have a bevy of stories about this garbage. Oh wonderful, I get to watch Ben Stein whine and lie for an hour. In honor of him being an economist, I declare too much opportunity cost for me to waste precious life moments listening to deluded people lie.

The picture is a methane geyser, and we see them here also. Whenever you see bubbling, especially in the swamps and bogs here, it is methane being released. I have heard there are enormous bubble releases that occur in the tailings ponds at the mines. It is a greenhouse gas, releasing more carbon than CO2. The technique used for such discoveries is called rational thought or evidence based thinking, rather than wishful delusion.

I suppose now all the global warming denialists will start screaming, but exactly what was this crap? This was April 8 on my walk to work. The snowbank is the middle of the street...too much to plow anywhere. I will not even add the last two days. I endured a five hour drive from St. Paul Thursday night rivaling the Dakar rally, with snow instead of dust. This is a cool pic though, I will admit: That was a monster.

Exactly what is this insanity?

The proposed new state Park at Lake Vermillion has all kinds of support, but the comments from local pols are show a a scary attitude:
http://minnesota.publicradio.org/display/web/2007/07/19/vermilionpark/

and here for Sen. Tom Bakk's recent comments:http://www.duluthnewstribune.com/articles/index.cfm?id=57914&section=homepage

Local Rep. David Dill has made similar comments about the state's need to sell lakeshore to make up for "lost" tax revenue. Parks are notorious for creating local revenue, and more often than not an entire economy is built around them. So why then, sell off precious, quickly disappearing lakeshore? Is it really just about taxes and local revenue, or is it something deeper ? I doubt it that is all there is. I think these guys just do not like nature. They are dems because that is the only way they can get elected here. I say protest this. We want and and need a state park, and we don't need to sell off what little precious lakeshore land we have left.

Here is how to contact:

For the St. Louis County Board:
http://www.co.st-louis.mn.us/slcportal/SiteMap/HomePage/ContactUs/tabid/552/SiteMap/HomePage/Departments/CountyBoard/tabid/554/Default.aspx


ForRep. David Dill:rep.david.dill@house.mn
For Sen. Tom Bakk: sen.tom.bakk@senate.mn

Iraq Reality and wishful delusion

No, the surge is not working.The attacks still occur but coverage doesn't. For several months, this has been the major media refrain: Petraeus is a genius,and the surge is working. Unfortunately,it just isn't true:
http://www.juancole.com/2007/12/top-ten-myths-about-iraq-2007.html
Looking deeper, we see what has actually happened.The population is either on the run as refugees, or it is separated by sect and/or ethnicity:
http://matthewyglesias.theatlantic.com/archives/2007/09/a_tale_of_two_mapes.php

Lesson: Beware of lazy reporters and the status quo