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Why Are We Paying $89 A Barrel for Oil? (Answer: It's Not What You Think)

| Wed Oct. 17, 2007 7:43 PM EDT

Oil hit a new high today, $89 a barrel. Some analysts predict it will soon hit $100. All this has caused much anxiety in the markets and handwringing in the press, which has generally attributed the increase to 1) unrest in the Middle East 2) increased demand, particularly from China and India and 3) speculators.

Okay, so all of these things are a factor to some extent. But what analysts and pundits generally fail to point out is another reason for high oil prices in the U.S. market is the devaluation of the dollar. If it weren't for that, oil would cost about $60 a barrel, as it does effectively does in Europe and Canada. On George W. Bush's inauguration day in January 2001, you could have purchased a barrel of oil for about $30. If you lived in Europe, a barrel would have set you back about 32 Euro. Because the value of the U.S. Dollar has fallen so substantially since then (it took 93 cents to buy a Euro in January 2001, it now takes $1.42), the increase in the cost of oil for a U.S. consumer has far outstripped the increase for a Euro (or Canadian, or Swiss, or just about any other) consumer.

Today, it takes US $89 to buy a barrel of oil, but only 62 Euro. Going from 32 Euro to 62 is a healthy rise, but is less than a 10% annual increase since Bush has been in office. By contrast, the move from $30 to $89 is nearly a tripling, or more than 17% per year. See this chart, where the price of oil in U.S. dollars is represented in white while the price in Euros is in red:

oilprices.gif

Thus, of the $59 increase in the cost of a barrel of oil to a U.S. consumer, more than $30 is due to the depreciation of the U.S. Dollar and the fiscal and trade policies that have contributed to it. Not Middle East tensions, not China's increased appetite, etc. Same thing is true with skyrocketing price of gold; gold is going through the roof, sure, but what's really happening is that the dollar is going through the floor.

Many things have led to the devaluation of the U.S. Dollar. But a big portion of it can be attributed to a growing deficit. Now some, like MoJo contributor James K. Galbraith, would argue that deficits per se aren't bad. But the problem with this deficit is that it is largely attributable to 1) runaway spending on a disastrous war with no end in sight—in fact the chart shows how the divergence between currencies really starts to pick up following the invasion—and 2) massive tax cuts to the wealthy.

And that ain't good.

Update: News story from Bloomberg confirms my thesis. Also, a primer on the difference between the price of crude vs. gasoline and the role of taxation.

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Nursing Shortage Explained

| Wed Oct. 17, 2007 7:09 PM EDT

The most recent issue of JAMA reported that in 2005 the United States had 218,800 fewer nurses than it needed. With nurses getting paid decent wages, why is that the case? Maggie Mahar at Health Beat has the answer:

Consider this: In the San Francisco area, a nurse with a bachelor's degree can hope to start out with a salary of $104,000. The salary for a nursing professor with a Ph.D. at University of California San Francisco starts at about $60,000.
This goes a long way toward explaining why nursing schools turned away 42,000 qualified applications in 2006-2007—even as U.S. hospitals scramble to find nurses.

Mahar also notes that the situation is just going to get worse: "The fact that the average nursing professor is nearly 59 while the average assistant professor is about 52 suggests that, as they retire, the shortage could turn into a crisis." There's also a pretty good post by Niko Karvounis on why the Republican cry of "socialized medicine," frequently used to describe the Democratic presidential candidates' health care proposals, is a bunch of malarkey.

Wildfires Emit Mercury

| Wed Oct. 17, 2007 7:09 PM EDT

31846674_1755653108_m.jpg Forest fires and other blazes in the US release about 30 percent as much mercury as the nation's industrial sources. Initial estimates from the National Center for Atmospheric Research find that fires in Alaska, California, Oregon, Louisiana, and Florida emit particularly large quantities of the toxic metal, and the Southeast emits more than any other region. The mercury released by forest fires originally comes from industrial and natural sources.

The researchers estimate that fires in the continental US and Alaska release about 44 metric tons of mercury into the atmosphere yearly. They caution their estimates are preliminary and subject to a 50 percent or greater margin of error. A next step will be to examine how much mercury is deposited on nearby downwind areas, compared to how much travels around the hemisphere. Most mercury from fire is gaseous, traveling thousands of miles before coming down in rain or snow. About 15 percent is associated with airborne particles, like soot, some of which may fall to Earth near the fire. "We would like to determine the risk of mercury exposure for residents who live downwind of large-scale fires," says author Hans Friedli.

Even more disturbing in light of the fact that the number and extent of wildfires are forecast to increase—and in fact already are—another pesky byproduct of global warming.

Julia Whitty is Mother Jones' environmental correspondent. You can read from her new book, The Fragile Edge, and other writings, here.

The New York Sun's Ethnic Paranoia

| Wed Oct. 17, 2007 6:53 PM EDT

Following up on the talk of Rudy Giuliani as "the New York Sun candidate," the Sun editorial board complained this morning about "[a] new epithet … in use on the left in respect of Mayor Giuliani—namely that he has been 'fostering a climate of ethnic paranoia.'" The "left" here is Talking Points Memo's Josh Marshall, who first used the offending phrase, and the Atlantic's Matthew Yglesias, who repeated it. Both references to "ethnic paranoia" occurred in discussions of Rudy's group of radical foreign policy advisers, several of whom harbor Islamophobic, Israel-centric world views. The Sun notes:

Yglesias quotes Joshua Marshall as saying of Mr. Giuliani that "the guy has no real sense that posturing and pandering to ethnic paranoia in New York City simply isn't the same as running a national foreign policy."

And then wonders, coyly:

What are New Yorkers to make of this idea of "ethnic paranoia"? To what — or to whom — are Messrs. Marshall and Yglesias referring? Ethnic New Yorkers? Ethnic Americans? Well, go figure...

Of course, the ethnic group Yglesias and Marshall are referring to is the American-Jewish community, specifically in New York City. And the Sun's charge, as Marshall noted today, is that he and Yglesias, "two Jews, are peddling some sort of subtle anti-semitism." Coming from the Sun (once described as "a journalistic SWAT team against [those] seen as hostile to Israel and Jews"), this is no surprise. But what I find interesting about this episode is the Sun's inability to accept the neutral descriptor "ethnic" for American Jews. As it turns out, this principle is codified in the Sun's in-house style guide, which, as reported by the Observer, contains this notable entry: "Ethnic. Means not Jewish or Christian." Interesting. But click over to the American Heritage dictionary and you'll find the first, or preferred, entry on "ethnic" accommodates Jews quite nicely: "Of, relating to, or characteristic of a sizable group of people sharing a common and distinctive racial, national, religious, linguistic, or cultural heritage." The Sun's definition is from the second entry, reading in full: "Relating to a people not Christian or Jewish; heathen." Talk about ethnic paranoia.

—Justin Elliott

Lights Out San Francisco

| Wed Oct. 17, 2007 6:37 PM EDT

logo-dark.png Sydney led the way last March. San Francisco is going dark this Saturday night, October 20, from 8-9pm, to send a message on global warming:

Lights Out San Francisco is a citywide energy conservation event on Oct. 20, 2007. On this night, we invite the entire city of San Francisco to install one compact fluorescent light bulb (CFL) and turn off all non-essential lighting for one hour.

Word has it that both bridges and the Transamerica Pyramid are on board, and many restaurants will offer candlelight dining. There's also a great party going on in Dolores Park. Drop by. . .

But why just one CFL? And why wait for your city to catch on? Join in from afar.

Julia Whitty is Mother Jones' environmental correspondent. You can read from her new book, The Fragile Edge, and other writings, here.

Lights Out San Francisco

| Wed Oct. 17, 2007 6:33 PM EDT

logo-dark.png Sydney led the way last March. San Francisco is going dark this Saturday night, October 20, from 8-9pm, to send a message on global warming:

Lights Out San Francisco is a citywide energy conservation event on Oct. 20, 2007. On this night, we invite the entire city of San Francisco to install one compact fluorescent light bulb (CFL) and turn off all non-essential lighting for one hour.

Word has it that both bridges and the Transamerica Pyramid are on board, and many restaurants will offer candlelight dining. There's also a great party going on in Dolores Park. Drop by. . .

But why just one CFL? And why wait for your city to catch on? Join in from afar.

Julia Whitty is Mother Jones' environmental correspondent. You can read from her new book, The Fragile Edge, and other writings, here.

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Republican Candidates Lukewarm On Global Warming

| Wed Oct. 17, 2007 6:14 PM EDT

499870475_97db2f3e5b_m.jpg Interesting piece in today's New York Times on global warming as the new litmus test for Republican presidential wannabes:

While many conservative commentators and editorialists have mocked concerns about climate change, a different reality is emerging among Republican presidential contenders. It is a near-unanimous recognition among the leaders of the threat posed by global warming. Within that camp, however, sharp divisions are developing. Senator John McCain of Arizona is calling for capping gas emissions linked to warming and higher fuel economy standards. Others, including Rudolph W. Giuliani and Mitt Romney, are refraining from advocating such limits and are instead emphasizing a push toward clean coal and other alternative energy sources. All agree that nuclear power should be greatly expanded.

Reason enough to deny them the job, IMO.

Julia Whitty is Mother Jones' environmental correspondent. You can read from her new book, The Fragile Edge, and other writings, here.

Politics 2.0 Strikes Back

| Wed Oct. 17, 2007 6:01 PM EDT

The July/August issue of Mother Jones roiled the blogosphere with an irreverent take on so-called Open-Source Politics. Web pundits inveighed against yet another print magazine (nevermind our blog and website) questioning the impact of Web 2.0 on political campaigning. A flash point in this flame war was the mock Wikipedia entry that we published in print and on our website. It claimed Open-Source Politics would "revolutionize our ability to follow, support, and influence political campaigns," but then wryly added: "And if you believe that, we've got some leftover Pets.com stock to sell you." Our goal was to mirror the way that Wikipedia and other Web 2.0 pages often get pranked, and slalom between extreme views, even as they move towards a middle ground and, hopefully, the truth. But the critics complained that our definition was a gimmick with little connection to the way Netizens actually thought of themselves.

At the time I wondered if the critics really spoke for the Web masses. Given that Web 2.0 is supposed to enshrine Web users (and not Web pundits) as the arbiters of truth, I decided to see what the Web actually thought about our mock Wiki. So in early July I posted our definition of OSP as an actual entry in Wikipedia. I cut only the Pets.com quip and the reference to Karl Rove, thinking that would get the entry booted. And then I waited. Three months have passed, and I think I can now say the results are in. Not only is my mock Wiki still the official entry for "Open Source Politics," it now comes up as the top hit for the term on Google.

There have been a few changes along the way. Most significantly, the entry is now titled "Open source political campaign" instead of "Open-source politics." But it still goes on to use "open-source politics" as the official term throughout and most of my original text is unchanged. The reference to "party bosses in smoky backrooms" was deleted, but the language about how Web 2.0 will "revolutionize our ability to follow, support, and influence political campaigns" still remains. It seems that what stuck our blogger critics as gimmicky hype strikes Wiki users as a pretty reasonable definition.

The other dramatic change to the entry is how official it now looks. Someone added a list of references that I'd cited, a bevy of links to ideas such as "open source governance," a table of contents, and a list of related terms under the header "see also." I should hope the page looks good, given that on Google it outranks every blog, outranks The Nation, Wired, MSNBC, and Slate, and yes, outranks Mother Jones (which ranks 14th in a search for the term). It's all quite frightening, or flattering, or humbling, depending on how you look at it.

Neato Viddys on the Intertubes: The B-52's

| Wed Oct. 17, 2007 5:58 PM EDT

B-52s

Looking for tunes as part of a random "consulting" assignment led me to the B-52's today, reminding me how much I love them, although you really shouldn't need an excuse for that. Most people will know "Rock Lobster" and "Love Shack," but I was introduced to them by MTV after their 1986 album Bouncing off the Satellites (I was in the middle of Nebraska, how else was I supposed to have heard them?), so let's go backwards from there and look at some of their less-widely-known tracks.

Acid Oceans Increasing Rapidly

| Wed Oct. 17, 2007 5:55 PM EDT

438038944_33e08b7ddf_m.jpg We've known for a while that ocean acidification is a bad bad thing. Now new research into corals using boron isotopes indicates the world-ocean has become about one third of a pH unit more acid over the past fifty years, reports the Australian Research Council. The acidity is caused by a CO2 buildup in the atmosphere, which then dissolves into the oceans—a development likely to be lethal for animals with chalky skeletons, who just happen to comprise more than a third of the planet's marine life.

Apparently this acidification is now taking place over decades, rather than centuries, as originally predicted, and is happening even faster in the cooler waters of the Southern Ocean than in the tropics. Corals and plankton with chalky skeletons rely on sea water saturated with calcium carbonate to form their skeletons. As acidity intensifies, it becomes harder to form their skeletons. According to Ove Hoegh-Guldberg of the University of Queensland: "Analysis of coral cores shows a steady drop in calcification over the last 20 years. . . When CO2 levels in the atmosphere reach about 500 parts per million, you put calcification out of business in the oceans." Atmospheric CO2 is presently 385 ppm, up from 305 in 1960. "It isn't just the coral reefs which are affected—a large part of the plankton in the Southern Ocean, the coccolithophorids, are also affected. These drive ocean productivity and are the base of the food web which supports krill, whales, tuna and our fisheries. They also play a vital role in removing carbon dioxide from the atmosphere, which could break down."

More alarmingly, recent experiments along Australia's Great Barrier Reef show that red calcareous algae—the glue that binds reefs together in turbulent waters—actually begin to dissolve at higher CO2 levels. "The risk is that this may begin to erode the Great Barrier Reef at a grand scale," says Hoegh-Guldberg.

So exactly where are our leaders, those slackers? What the hell is more important to attend to than this?

Julia Whitty is Mother Jones' environmental correspondent. You can read from her new book, The Fragile Edge, and other writings, here.