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Shutting down the logistics system which is currently heavily based on oil would be even more detrimental to our health. At this time the alternatives to oil are only barely starting to get ramped up. We can't afford to ignore alternative sources of supply as conventional sources are depleted.
Here's what will actually happen: Those who are basing their view of the future on gas prices not spiking to outrageous levels over the next five to ten years are going to wait to the last minute then find they cannot afford anything. Neither upgrading their vehicle nor replacing it. So what will happen? They will stop driving and some enterprising individuals will start new bus companies and the car-dispossed will have to take the bus.
In order to view peak oil as an economic disaster or the apocalypse you have to ignore basic economics. First of all, oil companies will not go broke. In every other industry, when it is difficult to raise prices due to competition, companies respond by cutting costs. This is due to innovation. Innovation will not disappear due to peak oil and there are several ways to cut costs in the oil industry so that oil companies can continue to make money. Secondly, as others have pointed out, higher prices will bring on more supply. Not just that, but higher prices will lead to substitution. We all know that electric cars are viable. Just that they are higher priced and not an EXACT substitute. It doesn't matter. There is also demand destruction. Instead of soccer moms driving their kids 30 miles each way in a 14mpg SUV, the kids will play in less far away soccer tournaments. For those applications that NEED oil, I think you'll also find that there are substitutes. In Europe you have the choice of expensive high speed trains or else low-cost airlines. With peak oil you will have the choice of expensive high speed trains or expensive airlines. There are VERY few other cases where oil is an absolute requirement and businesses will innovate solutions to these on a case by case basis. e.g. Do we really NEED plastic grocery bags? We WON'T see economic collapse, but we may see an economic climate resembling japan in the 1990s. i.e. tight
"I did not miss the "major thrusts" I just don't agree with them. The first person that can offer 200 million people an alternative to car pooling and mass transit wins the prize. Cellulose E85 and FFVs IS that alternative." No it isn't. Ethanol isn't going to work because there just isn't enough land by a factor of 20. On the land that is available, using all the biomass and returning none of it to the soil will result in soil depletion whose end state is a dust bowl. Not to mention that there's no way in hell that we will get most of our ethanol from cellulose. It'll be from corn or other competitors for food, raising food prices astronomically. Ethanol is a very very BAD idea. If you want a speedy alternative then it's natural gas. The end result though is going to be PHEVs and EVs quite simply because they make sense, regardless of what happens with natural gas. In the meantime, unfortunately, we are out of time. Peak oil is here and we have at best five years till we need to start dealing with the loss of 2 million barrels a day on a yearly basis. We MAY have to deal with it a lot quicker if there is a flareup in the mideast.
It amuses me the number of people who whine about "oh dear, on American Roads you'd get crushed by SUVs". As if this stops cyclists and motorcyclists from using the roads with NO protection. In addition, no matter what you drive, there's always something bigger than you that can kill you. Do you suggest that everyone drive 18 wheeler semis? If you're scared about being killed in a collision TAKE THE BUS. Sheesh. What a ridiculous argument.