2009-4-27 John Mauldin's Newsletter: On Energy Production Cut We don't control the Ten Poor We
to the chase. We rich people can't stop the world's 5 billion poor people from
burning the couple of trillion tons of cheap carbon that they have within easy
reach. We can't even make any durable dent in global emissions — because
emissions from the developing world are growing too fast, because the other 80
percent of humanity desperately needs cheap energy, and because we and they are
now part of the same global economy. What we can do, if we're foolish enough,
is let carbon worries send our jobs and industries to their shores, making them
grow even faster, and their carbon emissions faster still.
global supply of carbon.
countries ruled by nasty people control 80 percent of the planet's oil
reserves — about 1 trillion barrels, currently worth about $40 trillion. If
$40 trillion worth of gold were located where most of the oil is, one could
only scoff at any suggestion that we might somehow persuade the nasty people to
leave the wealth buried. They can lift most of their oil at a cost well under
$10 a barrel. They will drill. They will pump. And they will find buyers. Oil
is all they've got.
countries all around the planet are sitting on a second, even bigger source of
carbon — almost a trillion tons of cheap, easily accessible coal. They also
control most of the planet's third great carbon reservoir — the rain
forests and soil. They will keep squeezing the carbon out of cheap coal, and
cheap forest, and cheap soil, because that's all they've got.
Unless they can find something even cheaper. But they
won't — not any time in the foreseeable future.
no longer control the demand for carbon, either. The 5 billion poor — the
other 80 percent — are already the main problem, not us. Collectively, they
emit 20 percent more greenhouse gas than we do. We burn a lot more carbon
individually, but they have a lot more children. Their fecundity has eclipsed
our gluttony, and the gap is now widening fast. China, not the United States,
is now the planet's largest emitter. Brazil, India, Indonesia, South Africa,
and others are in hot pursuit. And these countries have all made it clear that
they aren't interested in spending what money they have on low-carb diets. It is idle to argue, as some have done, that
global warming can be solved — decades hence — at a cost of 1 to 2
percent of the global economy. Eighty percent of the global population hasn't
signed on to pay more than 0 percent.
We don't control the