June 15, 2011

Peak Oil versus Peak Medicare

The people who insist on alternatives to oil like solar and wind are insistent for a number of reasons; there's the global warming scam, there's the dependence on foreign oil and the money supporting questionable countries with questionable motivations, and then there's the worry over peak oil. Ah, peak oil. Proven reserves, the theory goes, have peaked and production will ultimately start to decline as we have reached the right hand side of the production bell curve. Here's some news for those of you who are so desperate to see a future of windmill-powered cars. You are as wrong about peak oil as you are about Medicare being untouchable.

First of all let's quickly agree to disagree on global warming.  There are plenty of reputable scientists who are doubters and now there's new fears of another Maunder Minimum (mini ice age).  Lot's of scientists have said there could be another global cooling period due to a sudden drop in sunspots that is believed to be related to the Maunder Minimum.  Of course that didn't stop the zealots at Wired from trying to throw hot water all over that cooling.

Secondly, also briefly, from the perspective of foreign oil imports, the top suppliers to the United States, #1 is Canada (twice the volume of Saudi Arabia), #2 is Mexico, #7 is Columbia, #12 is Brazil, #13 is Equador, #14 is Norway and #15 is the United Kingdom.  I'm not particularly worried about Norwegian terrorists.  The oil to radical regimes issue is real, but it's a little overblown relative to the number of friendly nations supplying the United States with oil.

Most importantly, the third point is about peak oil, and also about the second point.  The worlds proven oil reserves are approximately 1.34 trillion barrels.  World daily consumption is approximately 83 million barrels per day.  If no new proven reserves are found, ever again, at current consumption levels that means there is 44 years of oil left.  That's if no other reserves are found.  But Venezuela claims it just found enough oil to put it ahead of Saudi Arabia in proven reserves. From 99 billion barrels to 296 billion barrels.  Despite it being Venezuela it's still good news.  But there's bigger news.

The country with the world's largest oil supply?  The United States.  With the Bakken oil field's 503 billion barrels, and the Green River shale oil reserves of 800 billion barrels,  the U.S. has a huge oil reserve in those two reserves alone.  That amounts to 1.3 trillion barrels.  That number looks familiar.  That doesn't include ANWR and the off shore opportunities.  Guess what, the United States could be energy independent if it really wanted to be.

Liberals, obsessed with green energy who go with the peak oil argument however are typically the same ones who insist that Medicare is fine and needs no fixing.  It's one thing to not want to get your oil out of the sand, it's another matter altogether to stick your head in the sand.  That is precisely what Democrats are doing.

Via Newsmax;
"The Hospital Insurance Trust Fund is projected to become exhausted in 2020."

As plain as the sun, that sentence appears on page 4 of the Congressional Budget Office's "March 2011 Medicare Baseline," released March 18. Those 12 words encapsulate the gargantuan problem that undergirds today's national yelling match over Medicare. It hardly matters whether one loves or hates Rep. Paul Ryan, R-Wis., and his "Path to Prosperity."

If America does nothing, the CBO calculates that Medicare will run dry on September 30, 2020. If that fiscal year's last day sounds distant, it isn't. That milestone is five fewer months into the future than 9/11 was in the past.

From $239.4 billion in FY 2011, Medicare's primary Trust Fund drops to $20.5 billion in FY 2019. The next year, it reaches zero. Zip. Zilch.

Washington Democrats are in malignant denial about all this.
Peak oil is likely to happen at some point - some point long, long after peak Medicare funding. That's all I'm saying.

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