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Earlier discussion

Ask Jeff Rubin Add to ...

The Provincial Council of Women of Manitoba responded to the draft this month at http://www.mts.net/~pcwm/plup_response.pdf

The Council makes many of the points that you do. Where do we find decision-makers in Canada who see how we have to change the "same-old" patterns of development?

Jeff Rubin: Oil prices, not politicians, will determine land use. When it costs $2 per litre for gasoline, people won't be able to afford to live in the suburbs and they will return to the cities, from which they once came. Rising urban density will become the counterpoint to yesterday's suburban sprawl.

Richard Wakefield writes from London, ON: Compared to the book The Long Emergency, your prediction of the future is much more optimistic. One only has to look at our past to see that when resources are scarce wars break out. With China rapidly becoming the next Super Power supplanting the US and buying oil fields with AK47's, the next resource war would be like nothing we have ever seen before. It's like musical chairs where not only is a chair removed during the song, but another dancer is added to the floor.

That's what peak oil is in a growing economy. The question is, should we not be preparing for a return to the horse and buggy days with far fewer people?

Jeff Rubin: The future for human civiilization doesn't have to be the back side of the . Peak oil only condemns us to an ever falling standard of living if we insist on trying to consume as much energy as we did when oil was abundant and cheap. I am optimistic that people will respond to soaring oil prices by re-engineering their lives. And as more and more of us do that, we will, in turn, re-engineer our economy.

Brent Beach writes: I have read that the value of all US residential mortgages rose from $6.9 trillion in 2000 to $14.6 trillion in 2006 while percentage of home ownership rose from about 65% to 69%. So, a few more homes but much larger mortgages per home. Presumably people spent that money - it became part of the 70% of the US economy that is domestic spending. That amounts to about $1 trillion a year in spending in a $14 trillion economy.

With that money gone - no longer any ongoing free money - and the additional burden of more than twice the mortgage costs, is there much hope for US economic growth over the next 10 to 15 years?

Jeff Rubin: There is always hope, and between zero interest rates and the biggest budget deficit in history, Washington will get the economy growing again. But whether that rebound will be sustainable depends on the energy issue. Remember, we can bail out the banks, we can bail out the car makers, we can bail out the homeowners - but there can be no energy bail out.

Robert Adams writes: Jeff: Did CIBC force you out over the book? Regards and thanks for the clear-eyed commentary.

Jeff Rubin: Let's just say it was time for me to leave and you know, after 20 years, maybe time to do something a little different.

Diane Anderson writes from Chicago: What do you think will happen to Mexican oil production over the next 3 to 5 years if the oil price stays in a range of $50-60?

Jeff Rubin: Probably the same thing that will happen if oil is $150 per barrel. Mexico will cease to be an oil exporter of any consequence within the next 3-5 years because of the rapid depletion of its Cantarrell field, which is still home to over 40 per cent of the country's oil production.

Terri Evans writes: I'd be interested to learn of Mr. Rubin's insight on how the trend toward re-industrialization and de-globalization will impact urban settlement across the country. For instance, does he envision that Canada's population will continue to gravitate towards its largest metropolitan regions / corridors? How will small and medium sized cities fare in a more localizing Canada?

Jeff Rubin: It will be the movement from the suburbs to the city cores that will be most notable. But in order for the Torontos, Montreals, Calgarys and Vancouvers of the country to absorb those people, they will have to rezone cities for much greater urban densities. And we will also have to provide much more in the way of public transit since the primary reason people will be fleeing the suburbs is that oil prices will force them to give up their cars.

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