It's the Economy Stupid

I think Mr. Yglesias is really missing the point here. It's not just that passing the peak oil point will result in drastically increased prices at the pump. That's just where most Americans are going to feel the pinch. But oil and the petrol refined from it is used for many more purposes than fueling our personal transportation. It's used in manufacturing and in agricultural production. Transformed into plastics or fertilizer and much beyond simple fuel. When the price of crude oil rises, so does the cost of all those associated activities. Those costs get passed on to the consumer. And while the average American might notice the rising prices when fueling up their favored gas guzzlers, where they'll really be hurt is when food prices shoot through the roof. Or manufactured goods become increasingly expensive. Or home heating costs. Because once we've passed into this so called "Age of Insufficiency", we'll be out of this era of cheap energy that we're currently living in. And that our entire economy is based around. When cheap oil, subsidized by our massive military budget, stops being available, then the reverberations are going to be felt throughout society, not just on the road.

The danger, of course, that comes with such economic stagnation is economic collapse. That while our elites might enjoy the same way of life they do now, our poor and middle classes won't. They'll have slipped into hardship, maybe even a new Middle Ages of oppression and resentment as the world becomes a hardscrabble search for scarce resources. I don't that will come to pass, though, as we can innovate and assuage our way past those difficulties. But the underlaying problem isn't one that we can rely on improved technologies and industries to get us out of. They can't, not fast enough, not even if they started now, today. And, with the political climate what it is, they're not even going to try.