Jon Schaff alerts us to this rather important story. It looks like there is a lot of oil underneath North Dakota, enough to increase our domestic reserves by a factor of ten. Professor Schaff, who could find bad news in good weather, is a bit worried.
On the one hand one is glad because it might eventually lead to a lowering of fuel prices. On the other hand this is a little like the heroin addict finding a stash of the yam-yam in the trash. No, I am not comparing North Dakota to trash, although I am comparing the American consumer to a smack addict.
Well, it may be that the end of cheap oil would make us all more virtuous. But given a choice between poverty and plenty, I choose plenty. Modern civilization runs on oil. A lot of stern voices have been warning us lately that we are running out of the stuff, and we ought to begin acquiring donkeys and collecting driftwood. I am doubtful.
We have been running out of oil and/or other resources since the very beginning of the industrial revolution. At every point in that long history of running out of stuff, we have had more stuff at our disposal. The reason for this is that in using energy and other resources we are constantly getting better at getting the resources we need. The price of a barrel of oil or a gallon of gas seems steep todays, but it isn't, really. The fact that rising gas prices have yet to result in curtailed travel, even a little bit, proves this. The sudden rise in demand from China and India have put pressure on prices, but so far that demand is being absorbed. Higher demand means that previously useless oil deposits suddenly become precious. Then we figure out how to get at them, and when we do, oil again becomes cheap.
American consumers are about as good as anyone has ever been at recognizing what is cheap and what is expensive. I am all for a ten-fold increase in American oil, but not because it can make us "energy independent," which is a silly idea. I am for it because it means that human civilization can keep on getting richer. That is a kind of virtue, and I hope it continues.