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Sunday, December 09, 2007

How Iowa farmers are helping African development

Economist has a good article about the rise of ethanol (plus better diets,and other factors) increasing the price of corn and other food throughout the world. Of course, this is a good thing.

Africa needs one thing: infrastructure. Africa needs a system of roads to transport, police to prevent crime, courts to adjudicate disputes, machinery to amplify the productivity of labor, and rules to guide economic development.

Unfortunately, Africa does not have infrastructure. And the greatest infrastructure-building effort of all time ended in failure, following the bankruptcy of the European states caused by the World Wars.

Fortunately, the increasing cost of food will naturally shift production to Africa, and interested parties will begin to provide the infrastructure Africa needs. Of course the reasons will be largely selfish: the Core needs the roads to transport the food, the police to ensure production of food, the courts to ensure the delivery of food, the machinery to harvest and perhaps mill the food, and the larger rules to make sure all these steps happen smoothly.

But unlike oil, diamonds, or other goods that impact only a small part of a country's land and workforce, food production is a job for the whole country. The benefits -- not just increased income, but increased infrastructure -- are felt by half or more of the country's population, and throughout all arable land.

Mark in Texas points out that corn will give way to other crops as a source for ethanol. Indeed, corn isn't an end in itself. But the rise of corn-based ethanol in the United States develops the infrastructure to use ethanol: it develops the infrastructure to develop the infrastructure for Africa.

And that's a good thing.

Sunday, November 25, 2007

Fake State of Iraq v. Kurdistan

Karim, A. (2007). Iraq nullifies Kurdish oil deals. AFP. 24 November, 2007. Available online: http://news.yahoo.com/s/afp/20071124/wl_mideast_afp/iraqoilkurds (from Democratic Underground).

Even discounting the blood and treasure we spill, there are real costs to keeping the fake state of Iraq around. This is one of them:

Iraq's oil ministry has declared all crude contracts signed by the Kurdish regional authorities with foreign companies null and void, a government official said on Saturday.

"The ministry has nullified all contracts signed by the Kurdistan Regional Government," the official told AFP, asking not to be named. "They will not be recognised."

The government in Iraq's northern autonomous Kurdish region has signed 15 exploration and exportation contracts with 20 international companies since it passed its own oil law in August, infuriating the Baghdad government.

Oil Minister Hussein Shahristani has in recent weeks angrily denounced the Kurdish authorities for signing the contracts before the national parliament approves a new oil and gas law, declaring them "illegal"

Keeping Iraq as a unified state means the functioning Kurdish north is yoked to the Gappish Shia south, and the Gappish Shia south is tied to the Tony Soprano v. Osama bin Laden funland of the Sunni Arab west.

Iraq should be broken apart as quickly as practical, allowing three very different nations to speed ahead, or fall back, at the rate that is natural for them in this world.

07:33 Posted in Iraq, Oil | Permalink | Comments (6) | Tags: kurdistan

Tuesday, October 02, 2007

Burma needs to import refined fuel

Hookway. J. (2007). Why Myanmar could stir again. Wall Street Journal. October 2, 2007. Available online: http://online.wsj.com/article/SB119126187091245243.html.

Remember when I said that, if we did attack Iran, we should take out their refineries? Here's why:

Myanmar's recent wave of antigovernment demonstrations -- which drew as many as 100,000 protesters at their peak last week before the military began shooting at civilians and arresting Buddhist monks -- came after the government slashed a subsidy on imported diesel that was growing more expensive amid rising global fuel prices.

The junta's harsh rule has prompted trade and investment sanctions from the U.S. and European countries in the past. Now the U.S. is pushing for additional financial sanctions aimed at the military's senior leaders and companies that do business with them.

That could leave the government with less cash to buy imported diesel and other refined fuels, which it must purchase at global prices, or to provide other economic assistance to ordinary citizens. Although Myanmar exports natural gas and crude oil, the country lacks the capacity to refine such resources.

A financial crunch could stir further unrest among Myanmar's 56 million people, who are already suffering from decades of economic mismanagement. "The underlying conditions are going to get worse as Burma becomes more unstable and more of a pariah," predicts Sean Turnell, an economist at Macquarie University in Sydney and a member of that university's Burma Economic Watch program.

The correlation of forces are troublesome for Burma's military leaders, as their friends aren't too happy with them, their people are furious (as those facing higher prices always are), and the world seeks to compound those problems.

12:19 Posted in Oil | Permalink | Comments (0) | Tags: refinaries, burma

Wednesday, July 25, 2007

Poet: South Dakota Ethanol Corporate Blogging

Poet, a South Dakota ethanol company that got its start with a plan in Scotland, South Dakota...

Poet #1

isn't just a billion-gallon company that's poised to become the largest ethanol company in the world -- it's started a corporate blog. Congrats to Poet, and thanks to South Dakota Politics for the link!

Thursday, May 17, 2007

Disagreeing with South Dakota Politics

I like South Dakota Politics, a lot, but after checking the blog on my reader I find two posts to especially disagree with.

  1. SDP criticizes liberals for backing higher gas prices

    But as I wrote:

    It makes no sense to import vast amounts of oil from unstable petrokleptocracies. Oil revenues allow corrupt elites to avoid real reform and buy-off (often dangerous) special interests. It diverts capital from New Core growth economies to these backwords pits. It helps funds Islamic terrorism. It exposes us to another oil shock.

    and also...

  2. SDP says that Congress is less popular than the President

    But as I wrote:

    The reason: the American people are opposed to Congress as an institution, but are not so opposed to the President. Political science research (see, for instance, Congress as Public Enemy or Stealth Democracy) shows that Americans are opposed to the idea of a body that is dedicated to political compromise making decisions for us. We would rather our government be in the hands of experts, or people who are able to ignore politics and get things done.

Increase gas prices. Ignore Congress's job approval.

Monday, October 30, 2006

Bush with China, Congress against China

"Panel Urges Action vs. China on Trade," by Foster King, Associated Press, 28 October 2006, (from Democratic Underground).

"China military to tour U.S. bases," by Audrey McAvoy, Associated Press, 29 October 2006, (from Democratic Underground).

"Iraq, China to revive Saddam-era oil deal as Baghdad seeks investment"," by , Associated Press, 29 October 2006, (from Democratic Underground).

As the Bush Administration welcomes friendly ties with China:

A Chinese military delegation will begin a five-day tour of U.S. military installations in Hawaii and California on Monday and meet with senior U.S. officers in the latest step to repair military ties between the two countries.

About 30 midlevel military commanders in the People's Liberation Army, including division and brigade commanders, will visit U.S. Pacific Command headquarters in Hawaii, tour a guided missile destroyer in San Diego and observe Marine training at Camp Pendleton, Calif.

It is the third such visit by Chinese military officers since the countries agreed last October to increase military exchanges.

And, through the Iraqi government, has the Central State reinvest in Iraq:

China and Iraq are reviving a 1997 deal worth US$1.2 billion (€850 million) signed by Beijing and Saddam Hussein's government to develop an Iraqi oil field, Baghdad's oil minister said Saturday.

Officials will meet next month to renegotiate the agreement over the al-Ahdab field, said Iraqi Oil Minister Hussain al-Shahristani. He was wrapping up a three-nation tour to secure investment to revive his country's oil industry.

You can count on the Congress to play the protectionist card:

)— A congressional advisory panel's draft report is urging lawmakers to push for tough action against China on two festering trade disputes: intellectual property protection and Washington's view that China's currency is undervalued.

Recommendations in a draft of the annual report by the U.S.-China Economic and Security Review Commission, obtained by The Associated Press, deal with complaints by American manufacturers that Beijing's artificially low currency makes Chinese goods cheaper in the United States and American products more expensive in China.

China is America's natural ally in Systems Administration -- keeping the peace around the globe. It's too bad the Republican Congress does not recognize this.

09:26 Posted in China, Iraq, Oil, Republicans | Permalink | Comments (10)

Wednesday, September 20, 2006

Bush's Anti-Geogreen Gas Tax

"Dumb as We Wanna Be," by Thomas Friedman, New York Times, 20 September 2006, A27.

I've written before on the need for a geogreen gas tax. Raising the effective cost of petroleum to something like five-dollars-per-galloon. A geogreen gas tax supports freedom and frees us from propping up Middle East tyrants.

Stupidly, very stupidly, America taxes foreign sugar-ethanol. This hurts our New Core allies, props up Saudi terror-financiers, and takes in exactly the wrong direction.

Tom Friedman writes:

Thanks to pressure from Midwest farmers and agribusinesses, who want to protect the U.S. corn ethanol industry from competition from Brazilian sugar ethanol, we have imposed a stiff tariff to keep it out. We do this even though Brazilian sugar ethanol provides eight times the energy of the fossil fuel used to make it, while American corn ethanol provides only 1.3 times the energy of the fossil fuel used to make it. We do this even though sugar ethanol reduces greenhouse gases more than corn ethanol. And we do this even though sugar cane ethanol can easily be grown in poor tropical countries in Africa or the Caribbean, and could actually help alleviate their poverty.

Yes, you read all this right. We tax imported sugar ethanol, which could finance our poor friends, but we don't tax imported crude oil, which definitely finances our rich enemies. We'd rather power anti-Americans with our energy purchases than promote anti-poverty.

Hopefully Bush will flip-flop on this soon. Otherwise, his second term will be as wasteful as the Republican House is harmful.

Wednesday, September 06, 2006

Cole's Oil Cartography

"Bush Turns to Fear-Mongering: Creation of 'Islamic' Bogeyman," by Juan Cole, Informed Comment, 6 September 2006, http://www.juancole.com/2006/09/bush-turns-to-fear-mongering-creation.html.

The latest column by Juan Cole (a Professor at the University of Michigan) is his usual semi-factual self

Iran has not launched a war on a neighbor since the late 1700s.

True... ish. (Never mind that in the Tanker War, Kuwait required assistance of both the Soviet Union and the United States to protect her ships from Iranian aggression.

Another comment comparing the Syrian regime to California New-Agers must be read in context to be believed.

Next, Dr. Cole attacks the usual enemies -- Christians and Texans

If you want to know what is really going on, it is a struggle for control of the Strategic Ellipse, which just happens demographically to be mostly Muslim. Bush has to demonize the Muslim world in order to justify his swooping down on the Strategic Ellipse. If demons occupy it, obviously they have to be cleared out in favor of Christian fundamentalists or at least Texas oilmen.

This paragraph leads to an interesting map where Cole defines a "strategic ellipse." The map combines the best of Barnettian and Spykmanian geopolitics.

The Pentagon's New Heartland?

Leaving aside Cole's incoherent rant, what we are left with is the fact that much of the world's oil and gas comes from countries we don't much trust. Hopefully President Bush is serious about a geogreen gas tax.

Monday, June 12, 2006

Shrink the Gap. Support the Gas Tax

"The Energy Challenge," by Stephen F. DeAngelis, Enterprise Resilience Management Blog, 12 June 2006, http://enterpriseresilienceblog.typepad.com/enterprise_resilience_man/2006/06/the_energy_chal.html.

First, the reality:

Of course, China could buy state-of-the-art equipment that helps reduce the pollution created by coal-fired plants, but it fears that doing so could put the brakes on its economy, something it believes it can't do at this stage of its development. As a result, it buys antiquated equipment from local manufacturers, burns indigenous coal, and refuses to ask consumers to pay for measures that could protect their health. The article estimates that 400,000 people a year die in China from pollution-related illnesses. As its population ages and the long-term effects of pollution begin to kick in, the piper that China refuses to pay today will cost even more tomorrow in health care costs and subsequent productivity reductions.

In Beijing and Tianjin, I saw the face of pollution. But even I didn't see the 400,000 dead in Zhongguo per year. I am lucky I was merely robbed of the sky for a month, not my life like that annual half-million. I was merely sent to the Emergency Room.

Next, the hope. (Hint: it's a geogreen gas tax).

Read more ...

Sunday, June 04, 2006

Support Freedom. Support the Gas Tax

"Sakhalin Island: Journey To Extreme Oil ," by Stanley Reed, Business Week, 15 May 2006, pg 74, http://www.businessweek.com/magazine/content/06_20/b3984008.htm.

"You're Working for Chavez Now," by Stanley Reed with Stephen Ixer, Business Week, 15 May 2006, pg 77, http://www.businessweek.com/magazine/content/06_20/b3984012.htm.

"Five Secretive Sisters," by Stanley Reed, Business Week, 12 June 2006, pg 96, http://www.businessweek.com/magazine/content/06_24/b3988121.htm.

"Oil flow to be affected if U.S. makes wrong step: Khamenei," Xinhua, 4 June 2006, http://english.people.com.cn/200606/04/eng20060604_271024.html.

I recently had a fascinating and quixotic discussion with Federalist X of Amendment Nine over the need for (and likely popularity of) a national gas tax. More timely articles indicating we are too dependent on foreign oil -- and the kleptocrats who control that oil:

The current policy gives a large voice to revolutionary socialists like Hugo Chavez

What's it like to do business in the global capital of oil nationalism? Most international oil executives in Caracas don't want to speak on the record about the tricky game of dealing with Venezuelan President Hugo Chávez. But one executive confides that this has been a brutal year. The low point came on Mar. 31 when he was required to attend a ceremony at the Miraflores presidential palace, where Chávez took pleasure in bringing representatives of the world's oil elite -- companies such as Chevron (CVX ), Royal YPF Dutch Shell (RDSA ), BP (BP ), and Repsol (REP ) -- to heel. The occasion: the signing of documents that gave the state control over much of Big Oil's existing production in Venezuela. "It left a bad taste in my mouth," says the executive, adding that his child caught sight of him on TV and remarked to a friend: "My dad is angry. I'd better not go home."

The ceremony was another sign that the global oil companies are taking a beating from national governments in many parts of the globe. Venezuela opened 32 so-called marginal fields to international companies in the 1990s, contracting out operations to Chevron Corp., Royal Dutch Shell PLC, and others, which got a per-barrel fee depending on volume and price over a 20-year term. The companies poured an estimated $12 billion into these fields, increasing production by some 400,000 barrels a day with no capital expenditure by the government. But because these operating contracts were pegged to the oil price, Chávez condemned them as concessions in disguise -- an illegal violation of the country's sovereignty.

Like revolutionary socialists? Oppose the gas tax.

The current policy gives a large voice to reactionary kleptocrats like Vladimir Putin

Anton Chekhov, who visited in 1890, described the island, then a penal colony, as a hellish place. Even today Sakhalin is a remote, sparsely populated area whose few towns are dominated by shabby Soviet-era apartment blocks and patrolled by packs of semi-wild dogs.

The 600-mile-long strip of mountains and forests off Russia's Far East is as good a vantage point as any to see the international oil industry's future and the challenges it faces. Big Oil is having to place ever bigger bets to get the reserves it needs. As a result immense new landmarks -- drilling platforms, pipelines, and liquefied natural gas facilities -- are rising through the mists of this forbidding island. An estimated 45 billion barrels of oil equivalent lie beneath the icy seas off its shores, a figure rivaling what remains in the U.S. or Europe. But developing those resources is proving lengthy, difficult, and expensive. Cost overruns have been huge, and no one knows if the Russians will end up controlling the assets now being built. "This is a frontier project like the North Sea or Alaska [was]," says Ian Craig, CEO of Sakhalin Energy Investment Co. "The industry doesn't know how to do everything" here yet.

Dislike those pesky "Orange Revolutions" that bring freedom to countries? Oppose the gas tax.

The current policy gives a large voice to the worst of the Afroislamic Gap:

Marcel, a researcher at London's venerable Chatham House think tank, focuses on five of the most important NOCs, including Abu Dhabi National Oil, Kuwait Petroleum, and Algeria's Sonatrach, along with the two previously mentioned. These companies alone account for about 50% of world oil reserves and 25% of production. The author seems sympathetic to the NOCs' point of view, and she may be a bit uncritical about some of their assertions, such as Saudi Arabia's possibly over-optimistic pronouncements about its production capacity. But Marcel, assisted by former BP adviser John Mitchell, delves into everything from their corporate cultures to their financial systems, international strategies, and the evolution of partnerships between the NOCs and global oil companies. She also delineates some of the snags Western oil companies face in this politically charged region.

Support the oppression of religious minorities? Oppose the gas tax.

Believe that, gosh darn it, there are just too few nuclear weapons in the hands of unstable Islamic Republics?

Iran's Supreme Leader Ayatollah Ali Khamenei said on Sunday that if the United States makes a "wrong step" over Iran, oil flow in the region would be affected.

"If you (Washington) make a wrong step over Iran, energy flow in the region will certainly be endangered," Khamenei said in a speech broadcast on state television.

"You (Washington) will be unable to secure the energy flow in this region," he stressed.

Then oppose the gas tax.

Support liberty, freedom, and/or America? Want an America that relies on its ingenuity and innovation, not the Saudi royal family? Then support the gas tax.

14:38 Posted in Oil | Permalink | Comments (2)

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