Wednesday, August 25, 2004

How World War III Will Start...and Where.

Mr. Esmay  calls our attention to the fact that oil prices are high, and that there are some indications that the great oil field in Saudi Arabia, the Ghawar -- may be drying up.  He expresses doubt that there will be a catastrophic impact on the American economy from high oil prices.  That is debatable, although I would rather not get into that debate right now. 

Mr. Esmay opines, though, that high oil prices could result in considerable turmoil in the Middle East, if a higher degree of political stability is not attained.  No debate there.  However, there has been turmoil in that regoin for a long time.  The people there are used to it.  Therefore, I am not too worried about it.  That is not where the next World War will start.

The next World War will start in the Caspian region:


The Caspian region has 17 to 33 billion barrels of oil in proven reserves.  There are credible estimates that the total reserves are likely to be in the 171 to 191 billion range.  In addition, there is considerable natural gas.  Proven natural gas reserves are around 232 trillion cubic feet.  (1  2)

A quick look at the map will show what the problem is.  Russia holds only a small minority of the hydrocarbon resources in the area.  Russia, Ukraine, and Turkey are stable countries; Georgia is fairly stable; the rest are not.  The problem is not getting the hydocarbons out of the ground.  The problem is transporting it safely.  The majority of the energy reserves would have to go through at least some highly unstable territory, in order to get to world markets. 

BBL= billion barrels; * Ttl Reserves = Proven + Possible Res.; ** Only from Caspian sea region
  Caspian Sea Region Oil Reserves, Production, & Exports (1996) (Production & Export @ thousands barrels/day)
Ttl Reserves* Production Exports Major Exporting Cities
Azerbaijan 31-38 BBL 198.7 42.6 Baku
Iran** 12 BBL 0.0 0.0 Neka / Kharg Island
Kazakstan 95-101 BBL 532.1 254.5 Tengiz / Aktyubinsk / Atrau
Russia** 5 BBL 52.0 0.0 Novorossisk / Terskoye
Turkmenistan 34 BBL 103.9 26.4 Turkmenbashi / Charjou
Uzbekistan 1 BBL 182.6 3.8 .
Total 178-191 BBL 1069.3 327.3 .

There are two safety concerns: the vulnerability of the pipelines and shipping routes, and the vulnerability of the environment.  The pipelines would be very difficult to defend.  If the hydrocarbon makes it through the pipeline, it then will have to be loaded on a tanker.  Anything going through Turkey would have to be transported by ship on the Black Sea and/or the Mediterranian, then the Straits of Gibraltar.  If it goes through the Black Sea, it would also have to go through the Bosporus Straits.  Any spill east of Gibraltar would be an environmental catastophe.  Ships are especially vulnerable in either Straits. 

Note that the geography is such that no one nation can be completely independent in the production, transportation, and marketing of their hydrocarbon energy resources.  With the exception of Russia's relatively small slice of the pie, all the other reserves would involve at least three countries: the producer, the country with the transportation route, and the customer.  How many terrorist acts would it take to start a war in the region?

So far, we have spent a lot of money on the Iraq War:

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If we had spent that money on development of fuel cells, biodiesel, solar, and wind power, would the next war even be necessary?

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Monday, August 23, 2004

FDA Smackdown

Recently I wrote a post citing an editorial from the journal, The Lancet. In that post, I commented that The Lancet  is a fairly conservative journal, as most medical journals are. Yet, in that same issue, there was a blistering critique of the Bush Administration, in a different editorial, about a different topic:

Ejecting the FDA from the courtroom
The Lancet, Volume 364, Number 9435, 21 August 2004

Despite a traditional Republican belief in limited government, the administration of US President George Bush seems curiously tilted towards increasing governmental intrusion into health affairs. Its fixation on the doctrine of separation of powers among the three branches of government (witness the White House's initial refusal to allow the National Security Advisor, Condoleezza Rice, to testify before the 9/11 commission; it argued that the legislative branch cannot coerce the executive) is apparently a flexible one. The Food and Drug Administration (FDA), a part of the executive branch, is now taking an activist role in judicial matters. [...]

A BeefeaterTheir use of the term "activist," in this context, contains a certain understated irony; it's a good example of classic British humor. It's a serious matter, though. If, indeed, the Administration wants to reserve the right to be critical of the judicial branch, on account of alleged "activism," then they need to clean their own (glass) house first. Of course, if they had their way entirely, it would not be a glass house: transparency would be a thing of the past.

Rant tangents aside, what is the beef that they are getting on about.?

It turns out that the editors of The Lancet  have noticed a peculiar trend in behavior at the US FDA.  Our Food and Drug Administration is taking it upon themselves to file briefs in medical liability cases.  The Editorial notes that, in the past, the FDA would file such a brief only in response to a request by the court.  Now, though, it appears that they are doing this spontaneously. 

Personally, I wonder just how spontaneous it really is.  That is, I suspect that they are acting upon requests, not from the courts, but from the pharmaceutical companies that have a stake in the outcome of the cases.  I do not have any direct evidence of this, but the Editorial points out some circumstantial evidence:

The agency has to contend with a serious conflict of interest. Its chief counsel, Daniel Troy, who has been leading the charge in preemptive filings since his appointment in 2001, came to the FDA from a Washington law firm, where he represented the interests of pharmaceutical companies, such as Pfizer.
I mean, really, how is the FDA even going to know about these cases?  Do they monitor court dockets around the country, looking for tort cases in which pharmaceutical products have been alleged to be the cause of harm?  That would take a lot of time and money, and it seems doubtful that the FDA has people all around the country going into courthouses to look for such cases.  No, it is far more likely that legal firms have an inside connection at the FDA.  A case comes up, they call their buddy a the FDA, and, sort of like magic, the Federal Government  -- acting at taxpayer expense -- writes up a brief that is highly advantageous for the defense. 

The Editorial mentions Pfizer specifically.  I have nothing against Pfizer.  They make some great products.  And I tend to be skeptical of cases against such companies.  Indeed, the Editorial states:

Certainly, a great number of liability cases are filed each year in the USA. And juries sometimes award payouts that clearly exceed appropriate compensation for the harm done. Reform of the tort system, often championed by doctors' groups, insurance companies, and conservative organisations, has long been high on the political agenda--more so on the part of Republicans than Democrats, though many in both parties agree that some change is in order.

There are two problems with the FDA's "activist" stance, though.  One is that it is not the proper role of the Administrative Branch of the government to interfere with the Judicial Branch.  The second is that this is being done with public funds.  Both would appear to be at variance with traditional conservative values.  Unless you count good ol' boy cronyism as a traditional conservative value. 

Note: the opinions expressed here are those of the Corpus Callosum.  They are not necessarily congruent with the opinions of the editorial board at The Lancet. 

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