Heavy Lifting - thoughts and web finds by an economist
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Sunday, April 04, 2010
There is no doubt that our current president can talk with the best of them. It is also true that one does not become president of the United States without some natural political ability and the right timing.
However, there is a common wisdom that holds that President Obama is so much smarter than our previous president. I am not sure - it depends on how one defines smart and, more likely, what side of the political spectrum one is on.
However, it is possible to pick up factual mistakes that, unlike the "Mission Accomplished" banner, indicate that someone, somewhere is talking "politics" rather than "facts" - or at least facts well defined.
For instance, in his speech here in Charlotte last Friday (transcript here) the president had this to say in response to how exploring oil drilling off the eastern seaboard wouldn't solve our energy crisis:
But the notion that we could drill our way out of the problem -- you’ll start hearing about this because you know what happens during the summer. As soon as gas prices start going up -- every summer it’s the same thing, right? And then politicians start standing up and -- “we’re going to do something about it” -- and these days some of my colleagues on the Republican side, what they’ll say is, you got to drill even more.Notice the statement that immediately precedes "We can't drill our way out of the problem." That statement says the U.S. accounts for 20 percent of daily world consumption while we constitute only 2% of world reserves. The former number (20 percent) is a flow whereas the latter number (2%) is a stock.
It is non-sensical to compare stocks and flows - as we learn in economics - but the average person hears 20>2 and concludes that it must be impossible for us to drill enough oil to make a dent in our petroleum imports. Perhaps it is true that it is not possible for us to feasibly drill for enough oil to offset 14 tankers of oil a day from the Middle East, but it is not necessarily because of the stock-flow comparison.
Take an easy example: let's say that world consumption was 100 barrels a day and the U.S. accounts for 20 barrels a day. If the world reserve was 1,000,000,000 barrels, then the U.S. would account for 20,000,000 barrels of oil reserves. Thus, the U.S. could "feed itself" for 1,000,000 days or about 2,840 years. On the other hand, the world could produce oil for about 100,000,000 days or about 28,000 years. The stock and flow comparison doesn't really work.
Let's look at some real data.
World oil reserves: 1,348,528,420,000 barrels (1.34 trillion barrels)
US oil reserves: 20 (billion barrels)
Daily world consumption/production: 63.5 billion/year
US daily consumption: 19.5 million/day (7 billion /year)
How long will the world reserves last with no new reserve discoveries, and ability to extract known reserves with feasible technology? 45 years
How long would the U.S. survive on its own reserve? About three years. But the last comparison is absurd as it is not reasonable to assume that we would drill only to replace imports fully.
I just wanted to point out that someone (either POTUS or the people who write his speeches) were mixing apples and oranges when they didn't have to. Their point could be well made without the poor reasoning.
Alas, it isn't the first time and it won't be the last.
I notice you don't actually say anything one way or the other about whether or not we actually can "drill our way out of the problem." I mean, if you want to toss peanuts at what you think is someone else's flawed logic, I'm game. Funny thing is though, it seems like your doing more "talking politics talking than facts."
Maybe Obama's logic is flawed on some issues - in fact, I'm sure it is in some cases. Yet, I prefer the attempt to defend the policy positions on some facts and logic to the faith-based governing of the previous administration, regardless of the actual levels of intellect of the actors involved.
I think I pointed out that we can "drill" our way out for three years. That is a better claim to make in my mind then using numbers that don't make sense. I am skeptical that a viable (writ large) alternative to oil will be discovered/created by government direction but that is my own bias.
What has always frustrated me about the politicians of all stripes is the strained talking points that don't make a lot of sense when parsed fully (HL's archives are full of examples).
Not being an energy economist or engineer I have nothing much to add to the viability of "drill baby drill" - but that wasn't the point of my post.
We *can* grow bananas in Alaska if we want too, but that ain't the point either. I think the data about the stock of reserves is relevant because it highlights that there's a pretty high opportunity cost to drilling (relative to importing), be it environmental, or in more practical terms, lost resource wealth. Wealth constraints matter, especially in the short horizon of three years.
I remember when the financial melee was at it's peak, "W" gave a rose garden "press conference" that lasted less than a minute, didn't convey anything resembling a logical argument, and took no questions. "Here's what we're doing. Screw you if you don't like it" was the basic gist. Maybe he's a genius. I don't know. But if he was he did a fabulous job of hiding it.
The idea that Democratic presidents are smarter than Republican ones is a meme pushed by the Democrats.Post a Comment
It's improbable, to say the least.
It is typically claimed that 4 of the last 5 Democratic presidents are brilliant (Johnson excepted).
It is also typically claimed that the Republicans are going 6 for 6 on dumb ones (sometimes Bush I is regarded as smart but clueless).
It's possible, but not probable that this is correct. I think the evidence of not revealing Kerry's grades is telling here: Bush vs. Kerry in college was about as level a comparison as you'd get on this data, and Bush won on points. Oops. Better hide that tidbit.
FWIW: I'm a Republican who voted for both Mondale and Obama.
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