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The Frog in the pot Economy.
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JonSCKs
Posted 11/17/2009 08:08 (#927323 - in reply to #926395)
Subject: Difference between Comparative advantage and extortion


Trade for the most part is good. Trade can be a reason why two countries see rising incomes and standards of living. However dependency upon a product (such as Crude) when prices explode can also lead to extortion.. I believe these are the main differences between Middle Eastern Crude and trade with China.

We have benefited in Agriculture from Chinese trade.. the Chinese are carrying a large percentage of our government's debt right now.. so a case can be made that we are deficit spending too much.. and putting ourselves in an extortionable position.. I would support buying American first.. however, when the average UAW worker earns more in a week than the average Chinaman does in a year and the Chinese product is better.. well my sympathies go offshore.. I can sell my products to either.. and someone who is just trying to exist vs someone who wants to extort from the Gov't or whatever... (Auto bailouts with Union wages at a very high level...) well... what do you say? The differences between US standards of living and the rest of the world will not exist beyond our technological advances... I just don't see that as being sustainable.

No one forces people to go to Wal-Mart.. shoppers know where the products come from.. even US workers go there so...???

Can we afford universal health care? If everyone is pulling the rope... maybe.. somehow I have my doubts. What about healthcare for the Chinaman.. is the American worker more deserving of life then he?

Right or wrong.. those who do the work... deserve the rewards.. be they Americans or foriegners. Those who want to live off the work of others.. can take their chances.. as we see now.. even if we want to provide for those who don't work (health care..) we may not be able to remain solvent as a country... maybe I'm just too simple minded...?

I agree with your statement on Cellulosic residue and the land. I don't see us removing corn cobs here on the prairies given our organic material levels.

However, we are going to have to find MORE sources of convertable energy. The corncob thing may or may not work up north... (wonder how everyone is getting along with the mud and lateness of the crop this year..?) However, if they can make it work.. power to them.

Anyway.. in Ks we have a couple million acres of CRP grass... that in the past has been burnt off. Consider a quarter section of CRP going up in smoke in the spring... 160 acres x 3.5 tonnes of grass x 80 gallons of ethanol potential per ton x $2.00 ethanol value = $89,600 of energy going up in smoke..per quarter.. not to mention the CO2 global warming concerns. Are we going to "Cap and Trade" that also?

If we are doing that across 30 mln CRP acres.. that's $16.8 Billion dollars going up in smoke... As well as the $16.8 going offshore to replace the energy needed... Can we as a nation afford that? Heck that might even buy health care for California... Florida... NY... and a couple more states...???

Again you get back to the problem of removing too much residue from the land... so if you rotated on a yearly basis... harvested only... 33%... 50%... 67%... whatever would be prudent for the local conditions.. which would allow you to take into consideration wildlife... Hunting.. etc. Those worthwhile benefits that are currently being provided by this land use program.

Right now.. we have existing infrastructure that is parked in the shed with the hay crops put up that could be out there bringing Switchgrass in... for conversion.. with bolt on expansion of current existing ethanol plants.. we could add (in what may be the least harmful way) more sourcestock to our ethanol to energy conversions.. the waste product (lignin from Cellulosic) could maybe even be used to fire the boilers or something to run the whole plant... or spin turbines for electrons for the grid??? Wouldn't this be better than putting a plow to it to raise more grain... We may have indeed to do that.. but is that the BEST solution? What will happen in a short crop year? We need to build in redundancies to the system.. imho.

Basically you have cellulosic plant material that was compressed over millions of years trapped below the surface which we call HydroCarbons.. and some say will become tight.. see Crude Oil prices. Can we live off of the renewable plant material generated each year in a sustainable way? In order to solve this problem we are going to have to consider... I believe.. some of the things I am talking about...

jmho... and maybe a crazy one at that...??

enjoyed the discussion Jim.
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