Friday, December 23, 2011


Great article sent by my friend John.  Yes, the fracking bubble may yet wreak comparable damage to the housing bubble on what’s left of the American economy.  But you cannot separate the economic bubble from its long-term and long-lasting effects on the environment.  Every well-pad that is drilled is a mini-mountain-top removal site.  Every pipeline begun is a slash and burn clearcut of forests.  Every "regulated" pollutant that goes into the air and water goes into every body and every part of the ecosystem in "allowable" limits that add up to multiple problems down the road and beyond those that are immediately apparent.

Fracking is deservedly called one of the half-dozen or so International Eco-Crimes.  It is nothing less than ecocide."Sitting on our backsides waiting for the space brothers or the Rapture to solve our problems is no more helpful than sitting on our backsides waiting for progress or the free market or  algal biodiesel farms to solve our problems. These two ends of the spectrum are twins—think of them as the Tweedledoom and Tweedledee of the imaginary Wonderland that dominates so much collective thinking these days—and getting past them, it seems to me, is an essential step on the way to less futile responses to a challenging future.

My vote goes with Tweedledoom, because people will continue to sit on their backsides in that boiling pot of water until, like the fabled frog, they boil to death without ever knowing what was going on.  It may not be apocalyptic, but just like "regulation" of deadly industrial practices, the end result is still the same. 

"...The shale gas bubble is the big economic story you haven’t heard about, though that will likely change in the near future. Behind all the hype about limitless shale gas are two simpler and noticeably less impressive realities. The first is that fracking technology applied to shale deposits can free up modest amounts of natural gas. The second and more important is that for the last half dozen years or so, at least, fracking technology applied to Wall Street has been able to free up immodest amounts of credit, providing the funding for an explosive growth in the natural gas drilling industry.

The intersection between those two facts has produced a classic bubble, with wildly inflated reserve estimates bringing a torrent of cheap credit to bear on an asset that can’t support the grandiose claims made for it. Because US mineral rights laws and Wall Street’s expectations both require firms that buy shale gas rights to produce right away, irrespective of the state of the market, natural gas is now selling for a price—wobbling around $3.50 per thousand cubic feet, last I checked—that covers much less than the cost of drilling and extraction. My readers will no doubt recall real estate speculators in the midst of the bubble feverishly buying rental properties even when the rent covered only a small fraction of the mortgage payments; the logic here is exactly the same....."


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