The socialist takeover of Wall Street was never really in doubt from the 1987 stock market crash onward. But the bailout of investment banker Bear Stearns has provided a long-awaited bookend to that story.
Wall Street, which historically has been a bastion of vehement opposition to government intervention in the so-called free market, now takes it as a matter of right that the U. S. government and its central bank (as well as the central banks of other countries) will come to its rescue. The principle invoked--if it can be called that--is that Wall Street's institutions are too big to fail without causing a worldwide financial panic. This is an interesting form of extortion: "We'll bring down the world economy unless you bail us out. Never mind that we paid ourselves huge bonuses using other people's money while creating this mess."
There was a time when America's financial elite could be imagined to agree with U. S. Treasury Secretary Andrew Mellon (1921-1931) when he observed that the damage of the emerging economic downturn (soon to become The Great Depression) would be short-lived if only the government would allow events to take their natural course. "Liquidate labor, liquidate stocks, liquidate the farms, liquidate real estate," he is reported to have said. Mellon's reasoning was thus: "It will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up the wrecks from less competent people."
But, no longer do financial elites believe in punishment for past financial misdeeds. Now everyone must be backstopped by the very "nanny state" which many Wall Streeters have been fighting to destroy since the days of the American Liberty League during the Great Depression. (So contentious was the role of the Liberty League that even today the Wikipedia article linked above is bannered with the warning "disputed.")
It may seem like sweet irony that so many who have badmouthed government regulation and handouts to the downtrodden should now find themselves holding a tin cup (gold-plated though it may be) waiting for Uncle Sam to fill it with large checks drawn on the Federal Reserve and guarantees signed by the U. S. Treasury.
The irony is double since the very government which expanded its role in the 1930s to alleviate the suffering of the masses now seems organized to top off the bank accounts of the privileged few. But, it is the colossal incompetence of this same government, most notably during Hurricane Katrina, which ought to make us wonder whether the emergency measures it is now undertaking on Wall Street will forestall a wider financial catastrophe. So far repeated large-scale financial interventions have done little but break the fall. The unfolding spectacle of the American central government's impotence in the face of disaster ought to make us ponder whether solutions for any of our problems can actually come from above.
Author and scholar Chalmers Johnson has been laying out his case for how militarism and financial bankruptcy are hurtling the American republic toward its ruin, perhaps toward military dictatorship or revolution. (To see a video interview with Johnson discussing this thesis, click here.) Is such a government worth lobbying for legislation that will reduce greenhouse gases, increase funding for renewable energy, promote sustainable agriculture, regulate energy efficiency or even require the smallest steps to help avert the ecological catastrophes we face?
All those who do such lobbying deserve our admiration and our gratitude for what now seems a Sisyphean labor. (I admit we must hope for a breakthrough on sharply curtailing greenhouse gas emissions at the national and international level. I see no other way.) But perhaps the model of social democracy introduced by Franklin Roosevelt and the New Deal, that is, centralized assistance to a striken nation, may no longer be workable.
At the very moment when the most reticent and reactionary elements of American and world society are giving a thoroughgoing embrace to the socialization of risk (even as they continue to covet the privatization of reward), the immense centralized bureaucracies of the West which have given rise to its welfare states may no longer be up to tasks we face.
If Hurricane Katrina signaled to the American public that "you're on your own," perhaps it was not so much because of the insensitivity of the current American administration as the inability of the federal government to address problems that call out for local solutions and grassroots efforts.
(No doubt some will say that disaster relief must be the province of the central government everywhere since it alone can pull resources from other parts of the country to meet the needs of those afflicted. First, the evidence suggests that this reasoning is not entirely correct. Many nonprofit and volunteer organizations did a superior job to that of the U. S. government in organizing relief efforts. Second, if New Orleans and the other municipalities in the path of the hurricane had been solely dependent on local resources and planning for the decades prior to Katrina, they might never have ventured to expand their towns and cities in ways that would ultimately endanger so many people.)
This brings me to the argument I am having with many in the peak oil and sustainability movements. Should we focus on trying to get central governments everywhere to embrace policies that address sustainability and a low-energy future at the expense of local initiatives? No doubt many will say we should do both. But, the question is whether both are possible given the urgency of the tasks. Time grows short, and the moment to begin a kind of political triage may already be upon us. We may need to determine which governmental functions at which levels can and need to be saved and which cannot or should not be saved.
Surely, we do not want to be lulled into a sense of complacency like those new socialists on Wall Street who are now convinced of the wonders of a government safety net. In fact, when the wealthiest of the wealthy are screaming from New York skyscraper rooftops about the wisdom of government bailouts, it makes me wonder whether I should be running in the other direction. It makes me wonder whether I ought instead to be focusing on making my own community and all its institutions, both public and private, more resilient for the great storm ahead...and simply watch with informed resignation as the centers of power fall into ruin for reasons of bankruptcy, incompetence and impotence borne of organizational obsolescence.
Sunday, March 30, 2008
The socialist takeover of Wall Street was never really in doubt from the 1987 stock market crash onward. But the bailout of investment banker Bear Stearns has provided a long-awaited bookend to that story.
Tuesday, March 25, 2008
My latest column on Scitizen entitled "Why Energy Efficiency Won't Matter Without Energy Caps" has now been posted. Here is the teaser:
Energy efficiency advocates will continue to do the equivalent of running up the down escalator unless they embrace limits on total energy use....Read more
Sunday, March 23, 2008
As the United States sinks into a financial vortex and begins to drag the rest of the world with it, commentators are reaching for every form of hyperbole available. Former chairman of the U. S. Federal Reserve Board Alan Greenspan characterized the current trouble as "the most wrenching since the end of the second world war."
So unexpected and extreme have recent financial trends been that even the man who warned that derivatives are "financial weapons of mass destruction," legendary investor Warren Buffett, has encountered difficulties when his companies waded into the derivatives market.
Concern about a cascade of failures among financial institutions led the Federal Reserve to make loans to the beleaguered investment bank Bear Stearns Cos. by invoking authority it last used in the 1960s.
All of the events of recent weeks including the wild swings in both the stock and commodities markets are signaling the advent a rare full-blown, long-term credit crisis not seen in, well, a blue moon. Some are saying we haven't seen anything like it since the 1930s. As frightening as such pronouncements are, they all imply a rare but cyclical crisis that is understood to be severe, but ultimately of limited duration. Yes, such a crisis only occurs once in a blue moon, but when it does, despite all the damage that results, it eventually comes to an end.
All of this may turn out to be true, but only if the cause of this economic crisis is strictly as advertised, namely, too much credit given to too many people at prices too cheap for too long until many overreached and could not make good on their obligations. The problems appear to extend all the way from the humblest subprime mortgage holder to major financial institutions at the center of Wall Street.
Certainly, the reckless expansion of credit is one important cause for the crisis. But another cause seems to be hidden in plain sight. There is another market on high boil that both Wall Street and the public seem to be ignoring, the commodities market. Grains, energy and gold have been making spectacular new all-time highs. And, even as one trader managed to lose $140 million for his commodities broker employer in the wheat market, eyes remain riveted on Wall Street and the stock market.
There are all the usual explanations for the commodities bull market including that 1) growth in China and India is providing enormous new demand for basic commodities, 2) we are simply going through a normal cyclical upswing in commodity prices, and 3) new investment vehicles such as hedge funds and exchange traded commodity funds have made it easier for more people to speculate in the commodity markets. All of these things may be true.
But there are also other very disturbing causes. What is now being called a once-in-a-thousand-years drought has gripped Australia, one of the world's four remaining grain exporters. (The other major exporters are the United States, Canada and Argentina.) The result last year was an Australian wheat crop that was cut in half. That helped to send grain prices soaring. Is the drought related to global warming? If so, then there is reason to believe that the problem isn't temporary and that it may spread to other grain growing regions around the globe.
Another cause for rising grain prices may be that damage to the soil caused by decades of industrial farming is catching up with us. The rate of increase in global grain production has slowed dramatically. And, even though absolute grain production has continued to rise, yield per capita has been in a gradual decline for more than two decades. Whatever the reason, increases in grain production are not keeping up with population growth.
As for the high price of oil, it may indeed be due to high demand in Asia. But another cause may be slowing rates of discovery that have led many to conclude that a peak in the rate of world oil production may be no more than a decade away. And, as oil prices have risen, there has been a scramble to produce liquid fuel substitutes such as ethanol from sugar and corn and biodiesel from soy. This has led to higher demand and record prices for both corn and soy and to elevated prices for sugar. If the tightness in the oil market is due to an approaching oil peak, then the price trend in these energy crops is unlikely to abate soon.
There is, of course, the central role of oil in the world economy and the financial implications that an oil peak would have. First and foremost, it would mean very high energy prices for as far as the eye can see. It could also mean financial turmoil for importing nations such as the United States, turmoil that may already be manifesting itself in the form of a credit crisis.
Even the prices of crucial industrial metals such as copper, lead, nickel and zinc have risen sharply. Copper, for example, has risen from a low of 60 cents a pound at the beginning of the decade to a recent price of around $3.50. More worrisome are rare metals used in important consumer and business products and processes such as platinum used in catalytic converters in cars, indium used in LCD displays, and rhodium used for critical electrical contacts which have been up as much as 500 percent, 1,000 percent and 2,000 percent, respectively.
All of this is supposed to stimulate supply and bring down commodity prices. But, this is simply not happening in the oil industry where large international oil companies have been unable to replace their oil reserves despite their high levels of exploration and development spending. As this new picture of harder-to-find oil has emerged, these companies have instead begun to focus on buying other oil companies and on buying back stock which, of course, does nothing to increase oil supplies. It is true that substantial oil resources remain underground in OPEC countries. But these countries have little incentive to produce much more oil than they do today. Why not leave reserves in the ground and get higher prices later as the money is needed?
Nowhere is the problem of finding additional supplies of energy clearer than in the North American natural gas market. Natural gas production has been stuck on a plateau of about 27 trillion cubic feet of annual production since 1998. To quote from a previous piece of mine:
But, it's not for lack of trying. From a low in early 1999 of 397 active gas drilling rigs in Canada and the United States combined, the count has vaulted to 1,753 active gas rigs for the week just ended [January 18, 2008]. And, the high rig count is not just a recent phenomenon. Combined gas rig counts first reached 1,000 in the year 2000 and fluctuated between about 700 and 1,300 from then until mid-2005. At that point they broke through the 1,300 level and never looked back. The simple fact is that natural gas in North America is getting harder to find; and when we do find it, it is coming in smaller quantities that flow at slower rates than in the past. That's why we are having to drill so many wells just to run in place.
So much for the idea that high prices will automatically bring on supply. High prices may be able to stimulate drilling, but they cannot alas create natural gas.
For metals, prices have come down, but not to their previous levels. And, as for food, farmers have been shifting what they grow depending on which grain prices are going up. But, there is little room left to add acres unless conservation programs are completely abandoned.
The question then is this: Are we merely experiencing a cyclical, albeit once-in-a-blue-moon event that will resolve itself in lower prices for all the commodities that make our modern society possible...or are we facing a long-term struggle for the declining resources of the globe, a struggle that will potentially endanger our lives and completely transform our society? The answer may be no clearer than the moon when it plays hide and seek on a cloudy night. On other hand, the moon that I can make out on such an evening doesn't seem to be the least bit blue.
Sunday, March 16, 2008
So much talk these days centers around whether we have will have enough energy to power the world economy. The pessimists respond, "Not this world economy at this level of activity." The optimists, on the other hand, say not to worry. We have plenty of fossil fuels for the time being and new, clever technologies will harvest all the energy we need for the future. What is almost never discussed is whether we, in fact, have too much energy and whether that abundance has been our undoing.
Let's take four areas in which the growth of energy supplies has led to severe environmental distress. The most obvious and widely agreed on effect of burning our main energy source, fossil fuels, is global warming. Very little needs to be said about how the abundance of fossil fuel energy has led to the warming of the Earth.
Other problems include the deleterious effects of industrial agriculture, water depletion, and loss of biodiversity. What links all of these problems is population growth. And, that population growth has been made possible in part by vast increases in the productivity of agriculture--which, in turn, have been made possible by the development of petroleum-based insecticides and herbicides and natural gas-based nitrogen fertilizers. Of course, the advent of cheap liquid fuels also made it easy and cheap to mechanize farm operations including the transport of farm goods to market. The so-called "Green Revolution" was, in fact, a "Green and Black Revolution" when the role of fossil fuels is considered. And, that revolution has led directly to rampant soil erosion, a precipitous decline in soil fertility, and the poisoning of our water and food with insecticides and herbicides.
The needs of agriculture and the growing populations they fostered led inevitably to water depletion. Naturally, that depletion was aided and abetted by cheap energy used to pump and purify water for agricultural, industrial and household use. In addition, great dams could never have been built without liquid fuels derived from petroleum used to run heavy machinery. Beyond this, huge amounts of electricity are needed to power water pumps and purification equipment. In California, for example, at least 6.5% of the total electricity consumed is used just to pump and purify water. It is doubtful that the great water projects of that state would have been built were it not for cheap electricity.
Biodiversity is shrinking every hour. Diesel-powered logging machinery can clear in a day what might have taken weeks or months using traditional logging methods. Monoculture farming, an anathema to biodiversity, is now favored partly because it fits so well with the use of farm machinery--machinery which cheap, abundant energy has made inexpensive to build and to run. Urban sprawl, made possible by cheap gasoline for automobiles and cheap energy for the production of construction materials used to build that sprawl, is also no friend to biodiversity. Ironically, urban sprawl often colonizes valuable farmland or forest, both of which are required to feed and house the millions in suburbia.
It may seem as if we have been immensely irresponsible with the bounty of energy that fossil fuels have given us. But in reality we have done what any organism does with a surfeit of energy. We have used that energy to propagate ourselves and to take over increasing areas of the biosphere from other organisms in order to enhance our survivability. We have done what is logical and instinctual for any organism on Earth. That we would eventually get ourselves in a terrible predicament by doing so is only a relatively recent thought.
And, that brings us back to the idea that we may have too much energy. Think for a moment about what kind of world we might have if fossil fuels had never been discovered. No doubt many technical advances might never have occurred. The necessary energy and leisure for research (for tinkering actually) would not have been available. On the other hand, many technical advances have occurred in the past without fossil fuels. Sophisticated pre-petroleum civilizations have thrived producing great buildings, great art and great culture. Many have also produced a world of plenty for their inhabitants.
Even so, while it is true that the use of carbon-free energy sources might have prevented global warming, large supplies of any kind of energy would almost surely have contributed to the other problems detailed above. For example, with regard to industrial agriculture the manufacture of nitrogen fertilizers requires the extraction of hydrogen from some source to combine with abundant nitrogen from the air. Currently, natural gas remains the cheapest source for this hydrogen. But with enough cheap non-fossil fuel energy, we could have made the electricity needed to obtain virtually endless amounts of hydrogen using electrolysis to break water into hydrogen and oxygen.
Much of the transportation system could have been run on electricity produced without fossil fuels. And where liquid fuels were required--for example, to run logging or farm machinery--hydrogen could have been used as fuel.
The point is not to champion possible alternatives to oil, but to show that had such alternatives been our main sources of energy and had they been as cheap as oil to obtain and use, we would likely still be facing many of the environmental challenges we do today.
All that is so much speculation. However, in the future we may get a chance to find out whether we can build such a civilization albeit with the advantage or--depending on how you look at it--the disadvantage of all the knowledge we've gained during the fossil fuel age.
But there is one lesson which that age has not taught us, and we sorely need to learn it. Our biggest challenge is not related to getting enough energy. Our biggest challenge is to understand our relationship with energy and to recast it so that we may live more harmoniously with the world around us.
Sunday, March 09, 2008
Our futures, personal and collective, depend as much on our imagination as the brute facts. The brute facts, unpredictable and unfathomable as they sometimes seem, interact with our imaginations to create the world in which we live.
We can be fooled by imagination, for example, when we blindly follow the literalism of religious dogma; and, we can find transcendence, for example, through the insights of a particularly good novel or from a sudden revelation that solves a problem on which we have been working for months. I think of James Watson's dream of intertwined snakes that helped him to conceptualize the structure of DNA. The imagination never sleeps, but on occasion it seems to work especially well when we do.
Even my cat seems to be able to imagine the future, that is, one without enough food. He is constantly seeking to have his bowl filled when there is already plenty of food in it. And, yet he maintains his trim figure and never eats more than he needs. Does he imagine that I might leave him for too long and that he might run out of food even though that's never actually happened? Surely, many of us have seen dogs and even cats who appear to be dreaming. Muffled barks and howls come out of their mouths as they doze. Are they in some primitive way imagining or reimagining the world?
Is our ability to imagine the future somehow instinctual and thus a survival mechanism, albeit an imperfect one? If so, the question is, survival for whom and in what way? There are many levels of survival: individual survival; the survival of our family, our friends, our community, or our nation--in other words, our various tribal affiliations; and then there is the survival of the human species. The imagination can work for survival on any of these levels.
When it comes to a sustainable future, the purveyors of techno-optimism, such as Cambridge Energy Research Associates, imagine a future of unlimited prospects. They claim that resources, especially oil, are in much greater supply than the pessimists are saying. What the pessimists can't imagine properly, says CERA, is that humans are so clever that they will be able to extract ever larger amounts of energy from the earth. The energy is out there and we will simply learn to get it. Have faith!
One shouldn't be too quick to dismiss these optimists. A vast army of scientists is working on how to extract the last stores of fossil fuel from the earth, and even on how to make burning them less harmful to the climate. And, they are working on a wide array of alternative energy sources as well.
But one should ask who might benefit from this particular strain of imagination. It is largely the existing winners in the current globalized corporate economy. The techno-optimists conveniently imagine these winners winning more and bigger. Not surprisingly, these winners are often clients or employers. Many of these people will say that they are working for the good of all humankind and perhaps some really are. But can we say that most of them fit into the category of imagination that is in the service of tribal affiliation, in this case one formed around wealth and privilege?
There are also those with a dark apocalyptic imagination who see the limits of the biosphere fast approaching and who note our seeming inability to respond adequately. They predict a world of immense suffering and decline--a collapse, but not necessarily a wipeout for humans, something akin to going back to square one. Often, but not always, such people have deep grievances against the status quo. They find the current system profoundly hurtful or they find that they simply don't fit into the categories generally allowed in the modern world. In one sense, their vision is a method of striking back. In another, it is an attempt to return the world to a rudimentary level that might bring with it the possibility of a more equitable and harmonious society.
Here we have perhaps the inverse of the techno-optimists. But this inverted vision still bears the hallmarks of the tribal imagination since it calls for the radical reordering of one's tribe (that is, community or nation) that would destroy current social relations while opening up new possibilities in the aftermath.
Finally, there are those who imagine a world of smaller communities with localized food production and handicraft powered by sunlight. It would be an intentional world brought about through a methodical transition that avoids outright collapse. It is not necessarily a tech-free world, but one that nevertheless can only afford those technical advancements that require very much less power than we produce today. It is one where political authority is dispersed and therefore localized. It would have the potential but not the certainty of being more democratic.
One could, of course, wish for such an outcome just for one's own community or nation. Perhaps the purest form of this kind of imagination is Jay Hanson's "war socialism." But most who imagine such a future believe that the entire world must be brought into it. It does little good to prepare one's own community for a sustainable future only to have neighboring communities who haven't prepared overrun yours when supplies run short. In this sense this vision transcends tribal boundaries. But is it reasonable to imagine such an outcome? Jay Hanson would say no. We humans are genetically wired to take advantage of others, but especially of those outside our own group in order to get what we need. Our tribal instincts are simply too strong.
William James in his essay "Is Life Worth Living?" (which I've cited before) suggests that even if we cannot beforehand justify our faith in our vision:
It is only by risking our persons from one hour to another that we live at all. And often enough our faith beforehand in an uncertified result is the only thing that makes the result come true. Suppose, for instance, that you are climbing a mountain, and have worked yourself into a position from which the only escape is by a terrible leap. Have faith that you can successfully make it, and your feet are nerved to its accomplishment. But mistrust yourself, and think of all the sweet things you have heard the scientists say of maybes, and you will hesitate so long that, at last, all unstrung and trembling, and launching yourself in a moment of despair, you roll in the abyss. In such a case...the part of wisdom as well as courage is to believe what is in the line of your needs, for only by such belief is the need fulfilled.
Whether they know it not, most of those who imagine a relatively peaceful transition to a world of smaller, sustainable communities have adopted this attitude. And, if there is one thing that imagination makes possible, it is to believe that we are not necessarily limited by our past. We are thereby enabled to imagine a future that is neither merely an extension of present nor a negation of it, but rather an active enterprise in which we can all participate if only we are willing to exercise the imagination to do so.
Sunday, March 02, 2008
People are desperate to know the one thing which they cannot know: the future. Because it is concealed from us, the future often seems menacing. And so, many seek out soothsayers of all types to assuage their fears and sometimes to feed their dreams of success.
This impulse to divine the future accounts for the palm readers, tarot card readers, and astrologers found in every city and minor burg. And, this impulse also drives sales of checkout counter tabloids which often feature amazing predictions around the New Year said to be important to your health and your finances. It is this last category, finances, which brings us to the acceptable face of fortunetelling, the soothsayers in suits.
Any good fortuneteller will gladly discuss your future finances with you. But unlike the soothsayers in suits, she will not give you any details about how she arrived at her conclusions. As for those soothsayers in suits--they go by many titles such as economist, forecaster, director of investment research, and analyst--most offer mountains of so-called evidence that their forecasts are correct. Billions are lost and made on the basis of such predictions, though the billions lost are not so often remembered or storied as the billions made.
For the average person all this so-called evidence adduced to buttress an argument for a knowable future might as well not exist. He or she would be unlikely to understand it even if he or she were to review it. (And, in fact, understanding it might actually make it less believable!) But so desperate is the need to push back the menacing shroud of the future that the average citizen gives about as much scrutiny to the forecast of so-called economic experts as he or she does to the methods of the local fortuneteller.
This is not a new phenomenon, of course. The ancient Romans had their augurs, priests who divined the future through an examination of the flights of birds. The ancient Greeks, of course, had their famous oracles. Neither enabled their respective societies to avoid the kind of folly all humans are subject to. But today we face obstacles that test not just an individual society but our entire interlinked global community. When we try to predict something trivial such as the winner of an athletic contest and even bet money on it, say, in an office pool, it is a largely inconsequential affair, a form of entertainment (unless we are compulsive gamblers). But when the fate of global society hangs in the balance on forecasts of global oil supplies or the trajectory of global warming, we must examine our reliance on such soothsaying much more closely.
A heuristic tool or rule of thumb suggested by Nassim Nicholas Taleb, a self-styled philosopher of uncertainty and author of Fooled by Randomness and The Black Swan, may be useful. He says that he is more inclined to take seriously the predictions of people who don't wear suits than ones who do. His logic is that scientists generally don't wear suits--often not even ties--while economists and Wall Street analysts almost always wear them.
Optimistic pronouncements about world oil supplies come mostly from economists and non-scientific analysts. On the other hand, our predictions about the trajectory of global warming come almost exclusively from scientists. There is great uncertainty in such predictions. But, Taleb's second admonition is not to accept predictions from somebody who cannot or will not tell you his or her error rate. Scientists can generally tell you what it has been and what it is now for their work. Sometimes this error rate goes by the name of "degree of confidence" or "range." Economists and financial analysts almost never talk about such things, especially about their past records (usually out of embarrassment).
Recently, members of the Association for the Study of Peak Oil-USA (ASPO-USA) offered a $100,000 wager to the analysts of Cambridge Energy Research Associates (CERA), perhaps the most well-known of the world's energy consulting firms. CERA has continually reaffirmed its forecast of a peak in world oil production 30 years in the future followed by a long, undulating plateau. On a shorter timespan the firm predicts robust oil supply growth through 2017. There is, of course, the question of how anyone can know much about anything that will happen 9 years hence, let alone 30 years hence. What CERA has not done is release its past error rate (that is, the amount by which its past predictions have been off) nor has the firm assigned even a range to its predictions 9 or 30 years out.
ASPO-USA has released a reconstruction of CERA's past error rate based on the firm's public pronouncements. (It's not a pretty picture.) CERA now predicts that world oil production capacity will reach 112 million barrels per day by 2017 which ASPO-USA says is the equivalent of about 107 million barrels of actual production since capacity is never used to 100 percent for various reasons. The ASPO-USA gamblers don't see how this production level can be reached. They have implicitly offered a fairly wide range in their forecast via their wager, that is, anything less than 107 million barrels of average daily production for 2017.
The ASPO-USA group's purpose is educative. (They plan to give the money to charity if they win.) They want to highlight the risks in such a production forecast and also the possible consequences (which could be severe) if it's wrong. Why? Because virtually every major organization public and private bases its planning on such optimistic projections.
So far, CERA has not responded to the wager. I do not expect them to. Doing so would inaugurate an ongoing discussion of their previous faulty forecasts and of the risks attendant in any forecast. Such a discussion would cast doubt on the wisdom of paying fees to those who make such forecasts, fees that can be very lucrative indeed.
Despite the dangers which lurk ahead due to oil depletion (and myriad other resource issues), the public remains largely ignorant of the risks. Perhaps it is not because the information about those risks is unavailable. Try an internet search using the words "peak oil" and you'll see how much information is there.
But, just as people prefer to hear positive news from fortunetellers, they also find the reassuring pronouncements of the soothsayers in suits much more to their liking. The adult in us ought to see those suits as a warning flag that calls forth our skepticism. But it is the child in us that seems to be prevailing, seeking out soothing bedtime stories that will help us brave the dark night of the future rather than facing up to the uncertainties that ought to guide our efforts in the years ahead.