Statement of Representative Cynthia McKinney on the War Resolution of Representative John Murtha

[In this statement, Rep. Cynthia McKinney shows her usual courage, clarity, and humanity in opposing the Iraq war, and in defending one of its prominent critics from Republican attack. –FTW]

Statement of Representative Cynthia McKinney (D-GA) on the War Resolution of Representative John Murtha (D-PA)

The Republicans in this House have done a heinous thing: they have insulted one of the deans of this House in an unthinkable and unconscionable way.

They took his words and contorted them; they took his heartfelt sentiments and spun them. They took his resolution and deformed it in a cheap effort to silence dissent in the House of Representatives.

The Republicans should be roundly criticized for this reprehensible act. They have perpetrated a fraud on the House of Representatives just as they have defrauded the American people.

By twisting the issue around, the Republicans are trying to set a trap for the Democrats. A “no” vote for this Resolution will obscure the fact that there is strong support for withdrawal of US forces from Iraq. I am voting “yes” on this Resolution for an orderly withdrawal of US forces from Iraq despite the convoluted motives behind the Republican Resolution. I am voting to support our troops by bringing them home now in an orderly withdrawal.

Sadly, if we call for an end to the occupation, some say that we have no love for the Iraqi people, that we would abandon them to tyrants and thugs.

Let us consider some history. The Republicans make great hay about Saddam Hussein’s use of chemical weapons against the Iranians and the Kurds. But when that attack was made in 1988, it was Democrats who moved a resolution to condemn those attacks, and the Reagan White House quashed the bill in the Senate, because at that time the Republicans considered Saddam one of our own.

In voting for this bill, let me be perfectly clear that I am not saying the United States should exit Iraq without a plan. I agree with Mr. Murtha that security and stability in Iraq should be pursued through diplomacy. I simply want to vote yes to an orderly withdrawal from Iraq. And let me explain why.

Prior to its invasion, Iraq had not one (not one!) instance of suicide attacks in its history. Research shows a 100% correlation between suicide attacks and the presence of foreign combat troops in a host country. And experience also shows that suicide attacks abate when foreign occupation troops are withdrawn. The US invasion and occupation has destabilized Iraq and Iraq will only return to stability once this occupation ends.

We must be willing to face the fact that the presence of US combat troops is itself a major inspiration to the forces attacking our troops. Moreover, we must be willing to acknowledge that the forces attacking our troops are able to recruit suicide attackers because suicide attacks are largely motivated by revenge for the loss of loved ones. And Iraqis have lost so many loved ones as a result of America’s two wars against Iraq. In 1996, Secretary of State Madeleine Albright said on CBS that the lives of 500,000 children dead from sanctions were “worth the price” of containing Saddam Hussein. When pressed to defend this reprehensible position she went on to explain that she did not want US Troops to have to fight the Gulf War again. Nor did I. But what happened? We fought a second gulf war. And now over 2,000 American soldiers lie dead. And I expect the voices of concern for Iraqi civilian casualties, whose deaths the Pentagon likes to brush aside as “collateral damage” are too few, indeed. A report from Johns Hopkins suggests that over 100,000 civilians have died in Iraq since the March 2003 invasion, most of them violent deaths and most as “collateral damage” from US forces. The accuracy of the 100,000 can and should be debated. Yet our media, while quick to cover attacks on civilians by insurgent forces in Iraq, have given us a blackout on Iraqi civilian deaths at the hands of US combat forces.

Yet let us remember that the United States and its allies imposed a severe policy of sanctions on the people of Iraq from 1990 to 2003. UNICEF and World Health Organization studies based on infant mortality studies showed a 500,000 increase in mortality of Iraqi children under 5 over trends that existed before sanctions. From this, it was widely assumed that over 1 million Iraqi deaths for all age groups could be attributed to sanctions between 1990 and 1998. And not only were there 5 more years of sanctions before the invasion, but the war since the invasion caused most aid groups to leave Iraq. So for areas not touched by reconstruction efforts, the humanitarian situation has deteriorated further. How many more Iraqi lives have been lost through hunger and deprivation since the occupation?

And what kind of an occupier have we been? We have all seen the photos of victims of US torture in Abu Ghraib prison. That’s where Saddam used to send his political enemies to be tortured, and now many Iraqis quietly, cautiously ask: “So what has changed?”

A recent video documentary confirms that US forces used white phosphorous against civilian neighborhoods in the US attack on Fallujah. Civilians and insurgents were burned alive by these weapons. We also now know that US forces have used MK77, a napalm-like incendiary weapon, even though napalm has been outlawed by the United Nations.

With the images of tortured detainees, and the images of Iraqi civilians burned alive by US incendiary weapons now circulating the globe, our reputation on the world stage has been severely damaged.

If America wants to win the hearts and minds of the Iraqi people, we as a people must be willing to face the pain and death and suffering we have brought to the Iraqi people with bombs, sanctions and occupation, even if we believe our actions were driven by the most altruistic of reasons. We must acknowledge our role in enforcing the policy of sanctions for 12 years after the extensive 1991 bombing in which we bombed infrastructure targets in direct violation of the Geneva Conventions.

We must also be ready to face the fact that the United States once provided support for the tyrant we deposed in the name of liberating the Iraqi people. These are events that our soldiers are too young to remember. I believe our young men and women in uniform are very sincere in their belief that their sacrifice is made in the name of helping the Iraqi people. But it is not they who set the policy. They take orders from the Commander-in-Chief and the Congress. It is we who bear the responsibility of weighing our decisions in a historical context, and it is we who must consider the gravest decision of whether or not to go to war based upon the history, the facts, and the truth.

Sadly, however, our country is at war in Iraq based on a lie told to the American people. The entire war was based premised on a sales pitch-that Iraq had weapons of mass destruction menacing the United States-that turned out to be a lie.

I have too many dead soldiers in my district; too many from my home state. Too many homeless veterans on our streets and in our neighborhoods.

America has sacrificed too many young soldiers’ lives, too many young soldiers’ mangled bodies, to the Bush war machine.

I will not vote to give one more soldier to the George W. Bush/Dick Cheney war machine. I will not give one more dollar for a war riddled with conspicuous profiteering.

Tonight I speak as one who has at times been the only Member of this Body at antiwar demonstrations calling for withdrawal. And I won’t stop calling for withdrawal.

I was opposed to this war before there was a war; I was opposed to the war during the war; and I am opposed to this war now--even though it’s supposed to be over.

A vote on war is the single most important vote we can make in this House. I understand the feelings of my colleagues on both sides of the aisle who might be severely conflicted by the decision we have to make here tonight. But the facts of US occupation of Iraq are also very clear. The occupation is headed down a dead end because so long as US combat forces patrol Iraq, there will be an Iraqi insurgency against it

I urge that we pursue an orderly withdrawal from Iraq and pursue, along with our allies, a diplomatic solution to the situation in Iraq, supporting the aspirations of the Iraqi people through support for democratic processes.

(Washington D.C.)- The war in Iraq is not going as advertised. It is a flawed policy wrapped in illusion. The American public is way ahead of us. The United States and coalition troops have done all they can in Iraq, but it is time for a change in direction. Our military is suffering. The future of our country is at risk. We can not continue on the present course. It is evident that continued military action in Iraq is not in the best interest of the United States of America, the Iraqi people or the Persian Gulf Region.

General Casey said in a September 2005 Hearing, “the perception of occupation in Iraq is a major driving force behind the insurgency.” General Abizaid said on the same date, “Reducing the size and visibility of the coalition forces in Iraq is a part of our counterinsurgency strategy.”

For 2 ½ years I have been concerned about the U.S. policy and the plan in Iraq. I have addressed my concerns with the Administration and the Pentagon and have spoken out in public about my concerns. The main reason for going to war has been discredited. A few days before the start of the war I was in Kuwait – the military drew a red line around Baghdad and said when U.S. forces cross that line they will be attacked by the Iraqis with Weapons of Mass Destruction – but the US forces said they were prepared. They had well trained forces with the appropriate protective gear.

We spend more money on Intelligence than all the countries in the world together, and more on Intelligence than most countries GDP. But the intelligence concerning Iraq was wrong. It is not a world intelligence failure. It is a U.S. intelligence failure and the way that intelligence was misused.

I have been visiting our wounded troops at Bethesda and Walter Reed hospitals almost every week since the beginning of the War. And what demoralizes them is going to war with not enough troops and equipment to make the transition to peace; the devastation caused by IEDs; being deployed to Iraq when their homes have been ravaged by hurricanes; being on their second or third deployment and leaving their families behind without a network of support.

The threat posed by terrorism is real, but we have other threats that cannot be ignored. We must be prepared to face all threats. The future of our military is at risk. Our military and their families are stretched thin. Many say that the Army is broken. Some of our troops are on their third deployment. Recruitment is down, even as our military has lowered its standards. Defense budgets are being cut. Personnel costs are skyrocketing, particularly in health care. Choices will have to be made. We can not allow promises we have made to our military families in terms of service benefits, in terms of their health care, to be negotiated away. Procurement programs that ensure our military dominance cannot be negotiated away. We must be prepared. The war in Iraq has caused huge shortfalls at our bases in the U.S.

Much of our ground equipment is worn out and in need of either serious overhaul or replacement. George Washington said, “To be prepared for war is one of the most effective means of preserving peace.” We must rebuild our Army. Our deficit is growing out of control. The Director of the Congressional Budget Office recently admitted to being “terrified” about the budget deficit in the coming decades. This is the first prolonged war we have fought with three years of tax cuts, without full mobilization of American industry and without a draft. The burden of this war has not been shared equally; the military and their families are shouldering this burden.

Our military has been fighting a war in Iraq for over two and a half years. Our military has accomplished its mission and done its duty. Our military captured Saddam Hussein, and captured or killed his closest associates. But the war continues to intensify. Deaths and injuries are growing, with over 2,079 confirmed American deaths. Over 15,500 have been seriously injured and it is estimated that over 50,000 will suffer from battle fatigue. There have been reports of at least 30,000 Iraqi civilian deaths.

I just recently visited Anbar Province Iraq in order to assess the conditions on the ground. Last May 2005, as part of the Emergency Supplemental Spending Bill, the House included the Moran Amendment, which was accepted in Conference, and which required the Secretary of Defense to submit quarterly reports to Congress in order to more accurately measure stability and security in Iraq. We have now received two reports. I am disturbed by the findings in key indicator areas. Oil production and energy production are below pre-war levels. Our reconstruction efforts have been crippled by the security situation. Only $9 billion of the $18 billion appropriated for reconstruction has been spent. Unemployment remains at about 60 percent. Clean water is scarce. Only $500 million of the $2.2 billion appropriated for water projects has been spent. And most importantly, insurgent incidents have increased from about 150 per week to over 700 in the last year. Instead of attacks going down over time and with the addition of more troops, attacks have grown dramatically. Since the revelations at Abu Ghraib, American casualties have doubled. An annual State Department report in 2004 indicated a sharp increase in global terrorism.

I said over a year ago, and now the military and the Administration agrees, Iraq can not be won “militarily.” I said two years ago, the key to progress in Iraq is to Iraqitize, Internationalize and Energize. I believe the same today. But I have concluded that the presence of U.S. troops in Iraq is impeding this progress.

Our troops have become the primary target of the insurgency. They are united against U.S. forces and we have become a catalyst for violence. U.S. troops are the common enemy of the Sunnis, Saddamists and foreign jihadists. I believe with a U.S. troop redeployment, the Iraqi security forces will be incentivized to take control. A poll recently conducted shows that over 80% of Iraqis are strongly opposed to the presence of coalition troops, and about 45% of the Iraqi population believe attacks against American troops are justified. I believe we need to turn Iraq over to the Iraqis.

I believe before the Iraqi elections, scheduled for mid December, the Iraqi people and the emerging government must be put on notice that the United States will immediately redeploy. All of Iraq must know that Iraq is free. Free from United States occupation. I believe this will send a signal to the Sunnis to join the political process for the good of a “free” Iraq.

To immediately redeploy U.S. troops consistent with the safety of U.S. forces.
To create a quick reaction force in the region.
To create an over- the- horizon presence of Marines.
To diplomatically pursue security and stability in Iraq

This war needs to be personalized. As I said before I have visited with the severely wounded of this war. They are suffering.

Because we in Congress are charged with sending our sons and daughters into battle, it is our responsibility, our OBLIGATION to speak out for them. That’s why I am speaking out.

Our military has done everything that has been asked of them, the U.S. can not accomplish anything further in Iraq militarily. IT IS TIME TO BRING THEM HOME.

By Tom Whipple
November 17 - 23, 2005 VOL. XV NO. 37
Serving the City of Falls Church and Northern Virginia
Web FCNP.com
http://www.fcnp.com/537/peakoil.htm

In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes.

The Association for the Study of Peak Oil (ASPO) was formed in Europe circa 2001. After four years, the Association decided it could more effectively educate the world about the advent of peak oil by breaking up into national organizations. At last report, 15 national ASPOs are in some stage of formation – mostly in Europe.

Last week ASPO-USA, a not yet fully formed organization, had its first meeting in Denver. Some 450 people showed up to hear an array of knowledgeable speakers on nearly every aspect of when world oil production will peak and what we can or should do about it.

The top issue —is peak oil imminent and if so when— was discussed in depth by five respected and highly qualified speakers. The heart of their presentations was simple:

As long as the world’s economy continues to grow, it will need another 1-2 mb/d each year.

Production from the fields that are currently producing our 85 mb/d is continuously dropping. The optimists say this depletion is as little as 2.5 percent each year, while credible pessimists are saying 8 percent a year may be more realistic.

The answer to the rate of depletion question (and we won’t know for several years) is the key to the "when" of peak oil. If the depletion rate is only 2.5 percent then existing fields will still be producing about 74 mb/d in 2010. This amount can possibly be offset by production from new fields with a little left over for some economic growth. If the depletion rate is much higher then supply will not cover demand and we will see much higher priced oil.

This is the peak oil debate in a nutshell. It is the interplay between the worldwide demand as determined by price, the rate at which existing fields are depleting, and the oil industry's ability to bring new fields into production in the next five years. All this will determine the year when production peaks.

Differences among the speakers as to when peaking will occur hinge on their opinions about these variables. All, however, seemed to agree that we should see the peak within the next five years or so.

The most disturbing number presented at the conference was that the world's depletion rate may be as high as 8 percent. An 8 percent depletion rate for production from existing fields would be catastrophic because production would drop by nearly 30 mb/d by 2010. This is an amount that simply cannot be made up by production from new fields. If this rapid decline comes to pass, there will be widespread economic disruption, for there is little we can do to increase the production of substitute energy sources so quickly.

Several speakers are concerned there are not enough drilling rigs in the world and not enough experienced people to operate them. Even the eternally optimistic Saudis, while in the midst of announcing their expansion plans last week, caveated that these plans might slip due to the unavailability of sufficient drilling rigs. The damage and loss of drilling rigs during recent hurricanes in the Gulf of Mexico did little to help the situation. Indeed, there is some thought that the hurricanes did so much damage (some 730,000 b/d are still not back in production) and will require so many resources to repair, they will turn out to be a major reason why peak oil will occur sooner rather than later.

One speaker emphasized the precarious political situation in the major exporting countries— tribal unrest in Nigeria, re-nationalization of oil in Russia, chaos in the Middle East, and the biggest threat to the US of all, the assassination of Venezuelan President Chavez. If Chavez were assassinated, the price of oil is likely to climb to over $100 per barrel within 48 hours. Should fighting over his replacement ensue, the US could lose about 14 percent of our oil supply within two weeks.

After dealing with the "when" question, the conference turned to "what can we can we do about it". It was reiterated by several speakers that what we are about to confront is a "liquid fuels" rather than an "energy" crisis. It is conventional wisdom that once we all grasp that oil depletion is a fact of life; we will do everything we can to mitigate the situation by finding other sources to power our vehicles. For now choices seem to be non-conventional oil (tar sands, shale, and heavy oil), liquefy coal, and biomass. Of the three, only biomass is sustainable and may indeed be the only choice feasible on a scale of tens of millions of barrels per day.

The highlight of the first ASPO-USA conference may have been when Congressman Roscoe Bartlett asked if we really want to "mitigate" by spending all our treasure to produce oil substitutes after peak oil arrives. Would we not be better off if we started moving towards a world with minimal consumption of liquid fuels as soon as possible?

Right now the cry is "find more oil". Forget the environment and drill wherever and as much as necessary. The International Energy Agency is suggesting that with an investment of a mere $17 trillion (that's right trillion with a "tr") to find, produce, and refine oil, life-as-we-know-it can go on for another 25 years.

When it becomes apparent, however, we can no longer keep up conventional oil production, the cry will change to "produce substitutes." Billions, and perhaps trillions of dollars will be allocated to producing synthetic liquid fuels. If this can come from biomass it might make some sense, but if we ravage Alberta and our coal reserves to power our SUVs for a few decades longer, it does not.

This indeed my turn out to be mankind's key decision for the first half of the 21st century. Do we power down gracefully to a greatly reduced liquid fuel world; or do we thrash around for a decade or two trying to maintain life as we have known it?

[This otherwise brilliant and well-written analysis fails to grasp the energy dynamics of Peak Oil and thereby assumes that somehow China and Japan could (even if they wanted to) mesh into a mutually-beneficial economic pact. That will not and cannot possibly happen with Peak Oil. China has already made it clear that it intends to control all energy resources on the littoral Asian continental shelf. This includes all of Japan’s western territorial waters outside of a few miles. Japan has zero energy resources. Its only hope of even moderate local supply is in these waters, and military close calls have already taken place as ships from both countries plow to develop gas and oil reserves.

Forget the shrine visits, the textbooks and everything else. Energy is what Japan and China are fighting over. Emergent Japanese nationalism is a defensive reaction to this threat and, in my opinion, a not very well-toothed warning. Japan has little to fight with except US dollars and some excellent technology which – as I have previously said – likely includes ready-to-assemble components for nuclear weapons that could be deployed in very short order.

It is for this reason that, more than for any other region, I fear a nuclear conflict between Japan and China. That is one of the greatest perils facing the planet today. It is an inevitable conflict which the U.S. cannot effectively control. The US has too much to lose on either side. And it is a threat that will ultimately require some kind of global intervention, although the means and participants in that process have yet to make themselves known. – MCR]

Japan is stuck in its past, and its refusal to come to terms with it threatens to define its future and that of the whole of east Asia

The past year might be described as the moment time of China's rise. Of course its rise long predates these years, but this fact has suddenly been recognised worldwide, well beyond the global elite. It is now part of the popular common sense, not simply in Europe but everywhere; indeed, Europe has been relatively tardy in this process. The buzz surrounding Hu Jintao's visit is part of this picture. The phenomenon is even evident in China itself, where the past two years have seen a much wider awareness of both the fact and implications of the country's rise. In the face of this changed consciousness, it is inevitable that new stances will be adopted and new policy positions struck around the world. This is already happening in Japan, notwithstanding its typically understated tone. Developments there can only be described as ominous. While Europe still thinks of itself as somehow central to the future, east Asia is where the future will be played out. It is in that context that we should see the import of current trends in Japan.

When Junichiro Koizumi, the Japanese prime minister, secured his dramatic and overwhelming victory in September's general election, its significance was generally interpreted as a victory for his programme of privatisation and deregulation. This, however, is secondary. Far more important to Japan's future is Koizumi's implicit and incipient nationalism. This was demonstrated again on October 17 with his latest visit to the Yasukuni shrine, where class A war criminals are honoured, despite the opposition of China and South Korea and the wave of anti-Japanese demonstrations in China earlier this year.

Little is made too explicit in Japanese society, but the new cabinet, which Koizumi announced last week, spoke volumes about both his intentions and likely future trends in Japan. The two top positions, chief cabinet secretary and foreign minister, were given to Shinzo Abe, the man most likely to succeed Koizumi when his term finishes next September, and Taro Aso respectively. Both are rightwing nationalists and both, like Koizumi, are regular visitors to Yasukuni. This is the first time that the three key positions in the cabinet have been occupied by such figures. The previous cabinet secretary, who had opposed Koizumi's visits to Yasukuni, was dropped from the cabinet and the former foreign minister, who did not visit Yasukuni, lost his position.

One might think that this is to read too much into such visits to the shrine. On the contrary, they are symbolic acts, an expression of how Japan's past and future should be seen, and as such a deliberate, if coded, signal to the Japanese. Nor are these visits naive or innocent in the message they send to China and South Korea. Koizumi may express the view that they do not give offence to these countries but he knows that they do. And this, indeed, is their very intention. The more these countries protest, the more likely it is that Koizumi will continue to visit the shrine. He is laying down a marker - for the Japanese and to the Chinese and Koreans. Japan's future is already beginning to take shape.

The causes of growing Japanese nationalism may be diverse, but they are increasingly driven by one overwhelming factor: a fear of the rise of China. That is the only way the behaviour of Koizumi and the other leading lights in the Liberal Democratic party can be understood. It could be different. China, widely credited with having pulled Japan out of its long-running recession, represents an enormous economic opportunity for Japan, and is already Japan's largest trading partner. But far more powerful forces than mere economics are at work. Ever since the Meiji restoration in 1868, Japan has turned its back on Asia in general and China in particular: its pattern of aggression from 1895 onwards and the colonies that resulted were among the consequences.

To engage with China requires Japan to come to terms with its past, and Koizumi's visits to the shrine represent a symbolic refusal to do so. Japan is stuck in its past, and its past now threatens to define its future and that of east Asia. Even during the postwar period, when Japan dominated east Asia economically and China was weak and self-absorbed, it never had an influence commensurate with its economic strength. The reason was simple: its failure to atone for its past and embrace a new kind of relationship with its wronged and distrustful neighbours. If Japan could not do it then, it is even less likely to do it in the face of a resurgent China that is rapidly displacing it as the economic and political fulcrum of east Asia.

The broader significance of the shift within the cabinet, and the Liberal Democratic party more widely, should not be underestimated. Japan remains a profoundly hierarchical society. Apart from a brief few months a decade ago, the Liberal Democrats have continuously held power more or less since the war. This lies in a much longer tradition in which the ruling elite has enjoyed an extraordinary continuity as the determinant and arbiter of Japan's course. If anything, that situation has been strengthened over the past decade with the effective collapse of the Socialist party, once the second-largest party, and the marginalisation of the Communist party; both fiercely opposed Japanese nationalism.

The rise of Japanese nationalism should be seen alongside another trend: the increasingly close links between Japan and the US. Earlier this year Japan affirmed, for the first time, its willingness to support the US in the event of a conflict over Taiwan. It has also agreed to work with the US to develop and finance a missile-defence system whose intention is clearly the containment of China. It is not difficult to see the early signs of a new cold war in east Asia, with Japan and the US on one side and China on the other. It does not have to be like this. If Japan grasped the nettle of its past and ushered in a new era in its relationship with China, South Korea and the rest of the region, it would surely play a major role in the evolution of the most economically powerful region in the world. Instead it looks increasingly likely that Japan will remain in splendid isolation from its continent, weighed down by fear, suspicion and anxiety that its neighbours, above all China, will seek to lord it over Japan in the way that Japan did over them for over a century. Its only solace will lie in looking across the Pacific to the US, which is likely only to intensify its isolation. Japan faces an extremely uncomfortable future.

· Martin Jacques is a visiting professor at Ritsumeikan University in Kyoto, Japan

A big freeze is forecast. Sir Digby Jones fears a return to the three-day week. Could energy shortages paralyse Britain?

Turn off the lights. Go on. Turn off the reading lamp. Turn off the kettle, the oven, the microwave, the washing machine and the dishwasher. Turn off the refrigerator, the freezer, the shower, the central heating. Turn off the stereo and the television, the computer and the mobile phone. Very quiet, isn't it? And dark. And cold.

The temperature is dropping. The days are getting shorter. How would you manage if the lights went off and there was suddenly no power? If it happened during a cold snap, when the water pipes were freezing and there was ice on the windows, could you survive?

You may have to, if the very worst predictions come true. The Meteorological Office warns that we may be about to experience the severest winter for more than a decade, and it has put the emergency services on amber alert (red comes only with the snowdrifts). Worse, Britain is approaching this big freeze with fuel reserves far lower than most countries in Europe. We are facing an energy crisis that could see factories and offices having to shut down for all but three days a week, says Sir Digby Jones, head of the Confederation of British Industry.

Power companies admit this is true - and that they may even have to cut off electricity to our homes for short periods, a postcode at a time. But only as an absolutely last resort, they say. Only if there was "a 1:50", a winter so extreme that it happens only, on average, every 50 years. But hang on, the last one was in 1963, when the temperature hovered around freezing from Boxing Day to April. That was 42 years ago. Aren't we almost due a 1:50?

Today is the start of the season when Britain burns energy like a raver at a Christmas party. This is the date chosen in dozens of town and city centres across the country for minor celebrities to depress their plungers to make giant Santas and glowing reindeers flare into life. Oohs and aahs will follow - and even screams, like the ones heard in Covent Garden on Thursday night, when the operatic boy band G4, together with a town crier in full crimson regalia and an actor from Emmerdale, switched on the illuminations hung round a huge Scottish pine tree. The screech of the crowd suggested all those gaggles (or giggles) of teenage girls in reindeer antlers had never seen a lightbulb before. "Wow, look! It's so bright!"

But what if it weren't? What if the switch were flicked ... and nothing? What if all the lights went out because there was no more power left? What if we had used it up fighting a 1:50?

If it comes, disaster will be blown here on icy winds from Russia. Blizzards will strike and transport chaos will follow. Hypothermia will affect the weakest very quickly. An estimated 32,000 people die every winter as a result of cold weather, and the number increases by 8,000 for every degree the temperature falls below the seasonal average. Domestic energy bills have risen by a fifth over the past 18 months, and campaigners estimate that three million people - pensioners and the poor - may have to choose between buying food and heating their homes. For some, the lights will have go out even if there isn't a crisis. But if there is, we could see "quite severe loss of life", says the Mayor of London, Ken Livingstone.

If the super-cold weather continues for more than a couple of days, then demand for energy will soar. Britain only has enough gas to last 11 days at full pelt (the European average is 55 days). We can't just switch off all the gas cookers and go electric, because the power stations that produce Britain's electricity get 40 per cent of their energy from gas. That was not a problem when North Sea gas was cheap and plentiful, but now it is starting to run out.

At the same time, Britain is using more gas than ever - two-thirds more than a decade ago. So the country needs to import more gas in order to keep going. Unfortunately, there is not enough coming in, and not enough places to store it when it does get here. We have a problem. Experts say that within a decade Britain will be producing only 80 per cent of the energy it needs. They call it "the energy gap". It means that in a winter crisis, gas-fired power stations will ease off, and those that work on coal and nuclear fuel will be told to step up a gear.

All electricity generated goes on to a network of high-voltage cables that criss-cross the nation on pylons. This is managed by National Grid plc. Electricity is taken off the network and its voltage lowered in a series of sub-stations by 14 distribution companies, each of which covers a particular area of the country. But they don't normally sell the electricity to customers, or bill them. That is done by another layer of companies, the suppliers, such as npower, Powergen and, confusingly, British Gas.

The electricity on the grid comes from a variety of sources. About 2 per cent is imported directly from France, via a cable under the Channel from Calais to Folkestone. Another 6 per cent is provided by renewable sources such as wind and waves. The nuclear industry supplies 19 per cent from its ageing reactors. The Government will decide soon whether it wants to replace or augment these, but new ones will take at least 10 years to build. Despite Margaret Thatcher's best efforts, 33 per cent of our electricity still comes from power stations that burn coal. Some of it comes from open-cast mines in Scotland, the rest is imported from Russia and other countries.

The next step in crisis management is for National Grid to ask major energy users such as car-manufacturers and chemical factories to use less power, or even shut down for a short while, so that it can be diverted to homes. This has happened in France and Spain over the past few winters. Some firms have contracts that give them cheaper bills in return for an obligation to suspend production when needed.

If the cold snap continues into a third week, then the Government may be forced to demand that industry works three days out of five. This will be hugely unpopular. But not as unpopular as the rationing of electricity to homes. In extreme circumstances, the power companies say they will turn off a postcode at a time, for an hour. Then three hours, if necessary. They may also lower the voltage slightly so that supplies go further (but some appliances won't work).

By the time a thaw comes, the transport network will have been thrown into chaos and industry ravaged. Some firms, already struggling to meet high gas and electricity bills, will be put out of business. National life will be in suspension, with many halls, clubs and cinemas shut down or restricted. Hospitals will be under extreme pressure, too, as more people succumb to the cold. Many will die. Everyone else will be chilled, miserable and angry. Some may riot. Burning cars will keep them warm, at least.

The Energy minister, Malcolm Wicks, would call this scenario "scaremongering". That was the word he used when Sir Digby Jones warned: "If we have a harsh winter - and all the long-range weather forecasts are saying that we will - this economy, the fourth-biggest in the world and the most successful in Europe, will see the switch thrown on business."

The minister admits the gas supply is tighter than in recent years, but says the system can handle it. New storage and supply facilities for gas are being built, he says. That is true. A pipeline from Zeebrugge in Belgium is being upgraded this month to double its capacity. A new tanker terminal on the Isle of Grain in Kent has taken its first consignments of gas from Algeria, liquefied to take up one-600th of its usual space.

A new storage facility is being built in Hampshire, as well as new pipelines to bring gas from the Orman Lange gas field in Norway and from Holland. Two new terminals at Milford Haven will take seaborne supplies from Qatar. But neither of these will be online for at least two years. "The squeeze should be short-lived," a government spokesman has said.

Let's hope so. In the meantime, save energy, keep an eye on the weather forecast, wrap up warm - and get some candles in.

· Industry will have to bear cost of freeze, says Jones
· Government blamed for lack of gas storage

A cold snap this winter will cause an energy crisis that will force industry onto short-term working for the first time since the three-day week of the 1970s, the head of Britain's leading employers' organisation warned last night.

Sir Digby Jones, director-general of the CBI, accused the government of failing to ensure enough storage capacity for imported gas despite being told by business for the past three years that the depletion of North Sea supplies had left the country acutely vulnerable to a short freeze.

Amid forecasts from meteorologists that the country could be in for its coldest spell in more than 40 years, Sir Digby said he had again told the industry secretary, Alan Johnson, this week that Britain's limited stocks of gas reserves would run out after little more than a week of sub-zero temperatures. "If we have a harsh winter - and all the long-range weather forecasts are saying that we will - this economy, the fourth biggest in the world and the most successful in Europe, will see the switch thrown on business," Sir Digby told the Guardian.

Energy was the number one concern of CBI members, but ministers had told him not to be "alarmist" when he raised fears of a return to 1973-74, when the Conservative government responded to an Opec oil embargo and miners' industrial action by putting Britain on a three-day week.

"They have accused us of crying wolf. Well now, it's five to midnight. If it is another mild winter, that's fine, but if it's a hard winter there won't be sufficient capacity for business and to keep pensioners warm. It will back to the days of the three- and four-day weeks."

With the economy already sluggish, Sir Digby said there was "an enormously important winter" ahead. "If it's cold, then for certain the switch will be thrown, with all that means in terms of reduced output, reduced profits and reduced competitiveness. The chance of Gordon Brown standing up on budget day and painting a darker picture of the economy than would otherwise be the case is very real."

It would take two or three years for supply of gas to be boosted by a new pipeline from Norway and a new terminal at Milford Haven that will take imported gas from Qatar. At the moment, Britain's storage capacity was 11 days compared with an average of 55 days in the rest of Europe, and that would be quickly eaten up by a week or more of sub-zero temperatures.

In its winter forecast this month National Grid noted that gas supplies would be lower this year than last but said that in an average winter only modest amounts of demand reduction by industrial users would be required. It said energy supplies to domestic users could be maintained even in a so-called Siberian winter which happens once in 50 years.

A spokesman for the Department of Trade and Industry acknowledged that the gas market would be tighter this winter, but with new supply and storage capacity coming on stream the squeeze "should be short lived." As well as encouraging the industry's investment plans the government was also continuing to press for greater liberalisation in Europe - a move that observers say should help to erode price differentials.

Britain has had a run of mild winters, but the Met Office this week predicted cold weather in the coming months, especially in the south. Chief meteorologist Ewen McCallum said icy winds from the east would put a strain on transport and health services. "The important thing is to give an amber alert to government and business, to the energy industry, to health, to be cautious and plan forward."

Sir Digby said gas producers had been applying for planning permission to build more storage capacity for the past three years, but had been rebuffed. As a result, Britain would be vulnerable to energy shortages this winter and next, since it would be 2007-08 before the pipeline from Norway was complete."This winter is extremely worrying. It is frankly alarming that it is not getting the attention it deserves. Local authorities of all political persuasions, but also the government when it has had to get involved, have declined planning permission. It is so alarming and so disturbing that this government has allowed this to happen. Ministers have said we are being alarmist, saying that there is no chance of the consumer being blacked out. We are not saying that. What we are saying is that business is going to have the switch thrown."

Sir Digby said ministers had responded in three ways. "They have told us not to be alarmist; they have said business shouldn't have taken so long in getting the new pipeline and the Milford Haven facility on line; and they have said, finally, that they agree with us."

Britain was already paying 60% more for its energy than a year ago, and double what it was paying two years ago. The CBI was concerned that the French and the Germans were flouting EU regulations by subsidising their firms, and was also becoming increasingly anxious that the government should respond to the looming obsolesence of UK power stations by opening a debate on future energy supply.

Britain's energy industry is facing a squeeze on gas supplies from a combination of rising demand and falling North Sea output, as Sir Digby Jones indicates.

The combination means that during the winter months Britain is becoming increasingly reliant on its ability to import gas, but it needs to extend the infrastructure to make that possible.

The energy industry is investing heavily to bridge the gap, but it takes time to build gas pipelines and storage facilities, as well as terminals to handle liquefied natural gas.

An LNG terminal at the Isle of Grain has already been commissioned, but an extension to more than double capacity will not be ready until 2008. Two other terminals in Pembrokeshire are due to come into operation by 2007/8 and to reach full capacity in 2009/10. The LNG terminals will also broaden the geographical areas from which imports of gas can come.

Britain also takes gas directly through the interconnector with Belgium, where an upgrade should be completed by the end of the year. Other pipelines to the Netherlands and Norway are planned, including the Langeled pipeline to the Ormen Lange gas field - capable of supplying more than a fifth of the gas Britain uses to generate electricity - which should be close to full capacity next winter.

Unlike electricity, gas can be stored - ideally, suppliers buy gas in summer when prices are lower and sell it during the winter. Humbly Grove, in Hampshire, will be the first new storage plant to come into operation but most of them, including the biggest, at Fleetwood in Lancashire - are not due in service until the winter of 2007/8.

When the infrastructure projects are completed, the increase in import capacity should improve security of supply and put downward pressure on prices. Greater liberalisation of the energy markets in continental Europe should also help to cut prices.

To gain insight into the potential time-varying shape of world oil production peaking, this author examined regions that have already peaked. Unencumbered regions and countries were considered. All had significant peak production and all are past their peak. Their experience shows that the onset of peaking can occur quite suddenly and is not obvious, even a year prior to the event. The peaking of world conventional oil production may or may not follow previous trends, but these observations may be valuable for planning.

World production of conventional oil will reach a maximum - a peak - and then decline. The timing is uncertain; some think it could occur within a matter of years, others in a decade or two. 1 - 11 Without a major effort to mitigate related oil shortages starting well before the onset of peaking, the economic consequences worldwide will be dire. 12

By conventional oil, we mean oils of higher gravity that make up over 95% of current world production. The likely world oil production profile before, during and after world conventional oil peaking is almost certainly not predictable, because it will be a function of an array of unknowable factors:

World economic development prior to peaking
Oil prices a decade or more prior to peaking
The application of advanced technology in the world's largest oil fields
Damage and past mismanagement of large oil fields
Oil supply-demand expectations a decade or more before peaking
Concession and contract policies affecting outside investment
Political stability in regions with the largest production before peaking
Geology of major oil producing regions.

A scenario analysis involving these and other variables might be possible, but it is likely to be so complex as to be of questionable value.

Modeling of oil production peaking is often based on a bell curve (also known as a normal or logistic curve) an approximation of oil production as a function of time. This approach was utilized by M. King Hubbert in 1956 in his forecast of US oil production peaking. 13 Fig. 1 shows the 30-yr interval near the apex of a bell-curve that was fitted to US Lower 48 states conventional oil production by Deffeyes. 14 Production data follow the curve closely from 1910 - 1960 and from 1980 - 2003 (not shown here). The curve indicates a peak in 1976, while the actual peak occurred in 1970, as Hubbert predicted.

The top of the bell curve in the figure is relatively broad. The period from 98% of maximum on the upslope to the 98% point on the decline side is about 10 years long. If world oil production peaking were to be characterized by such a relatively broad maximum, the task of mitigation would be easier than if the peak were sharp. In addition, a bell curve production profile would provide a degree of forewarning of the approaching peak.

Consider what happens in the development of an economically viable oil field. After a confirmed discovery, development proceeds, production rises to a maximum after which it goes into decline. Along the way, oilfield operators apply various technologies to increase production beyond what nature would otherwise provide, e.g., water flooding, fracturing, artificial lift, etc. Nevertheless, the geology of each oil reservoir will ultimately set an upper limit on the amount of oil that can be practically produced. In addition, the time-varying production profile for an oil field can be strongly influenced by management decisions and politics, that can affect oilfield dynamics.

Geographically, large oil production regions contain reservoirs of different sizes and types. Regional output is the sum of all its producing oil fields, which varies over time. An example of regional oil peaking is the US Lower 48 states, Fig. 2. 15 This region is of particular interest because it was the world's most prolific conventional oil production region for much of the 20th century.

Fig. 2. Oil production in the US Lower 48 states 1945 - 2000 shows a triangular profile, not a bell curve shape.

The dashed lines provide a reasonable fit to the data for the 55-yr period and show a triangular pattern, not the bell curve described earlier. The approximate slope of both dotted lines is 2%. Accordingly, a 2% decline after peaking is a useful benchmark for judging the decline profiles of other regions. A decline of less than 2% could be considered gradual, while a decline of more than 2% could be considered steep.

Some forecasters believe that higher oil prices and new technology will have a dramatic impact on oil production. The Lower 48 experience indicates otherwise. Oil prices increased dramatically in 1973 and 1979, but those price escalations did not alter the general oil production decline in the Lower 48 region, Fig. 3. In addition, the period 1975 - 2000 was characterized by large improvements in oilfield technology, including affordable 3D seismic imaging, low-cost directional and horizontal drilling, greatly enhanced geochemical understanding, dramatically improved geological modeling, etc. Nevertheless, the decline in Lower 48 production continued, essentially unabated. This long-term, real-world experience provides strong evidence to challenge the thesis that high oil prices and advanced technology can mitigate oil production decline.

Fig. 3. Neither oil price nor advanced technology had a major impact on production.

No production data set is without numerous complications. In the case of the US Lower 48 states experience, a number of factors beyond price and technology impacted, for example:

Over the period 1945 - 1970, the Texas Railroad Commission set allowable production in the state, which represented a significant fraction of total Lower 48 production
After peaking in 1970, low-priced oil from the Middle East entered the US market in increasing volumes, almost certainly affecting domestic oil decision-making
During the period 1970 - 2000, the US experienced four recessions.

It would be extremely difficult, if not impossible to isolate these and other influences in an effort to develop a clear picture of what production might have otherwise been. In fact, every oil-producing region of the world has been and will be influenced by complex forces that defy definitive isolation and evaluation.

Not all regional production histories are useful because of easily identified distortions. To avoid the obvious pitfalls, certain criteria were adopted:

A relevant region (often a country) must represent a large, geologically varied province and be clearly past its maximum likely oil production. While the cases cited here all appear to be past their likely maximum production, there is the possibility of a major new discovery. For some of the regions and countries cited, such a trend reversal is essentially impossible. For others that have recently peaked, a major reversal is unlikely because of extensive exploration with the latest technology
Production at peaking must have been significant, greater than 1 one million barrels of oil per day at peak
Production data must be available several years before and after peaking
The region had to have been generally managed for maximum oil production prior to and after oil peaking. Accordingly, we did not consider regions whose production was constrained by cartel considerations or extraordinary political events. As part of this analysis, we took note of production one year before and one year after peaking in an effort to identify related short-term trends.

The regions that fit our criteria were: Texas, North America, United Kingdom, and Norway. Each is certainly or almost certainly years past its peak production, so major new discoveries are unlikely to change their peaking profiles. In each case, management, market and political factors influenced oil production in ways that we considered second-order. None were subjected to extreme political influences of the types experienced in Russia and Venezuela, for example, and none were part of OPEC.

Many countries with large oil production were not useful for this analysis. First are the OPEC countries - Algeria, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, UAE and Venezuela. Over the past three decades, OPEC limited member production to less than their maximum productive capacity in an effort to control world oil prices, so from time to time their production histories were strongly manipulated. Oil production in Russia was dominated by significant mismanagement prior to the fall of the Soviet Union. Most recently, political turmoil and transportation constraints have had a major impact on Russian oil production. Venezuela is a member of OPEC and thus limited its oil production over past decades. In addition, recent political turmoil and oilfield mismanagement have distorted their production in complex ways.

Figs. 4 - 7 show annualized daily production data for a 10-yr period around peak production for the selected regions and countries. Yearly data were considered appropriate for identification of major changes, because monthly data can fluctuate dramatically and obscure longer-term trends. While heavy oil was produced in some of the regions of interest, it was fractionally small enough to be neglected for our purposes.

Table 1 is a summary of the data, including the fraction of maximum production one year before peaking and one year after for Texas, 16 North America, 17 the UK 15 and Norway. 17 In addition, peak production data are shown for three countries that are also past peak production, but whose maximum production was less than one million barrels of oil per day - Argentina, 17 Colombia, 17 and Egypt. 15 Examination of the data leads to the following observations:

In all cases, it was not obvious that production was about to peak a year prior to the event
The peaks were sharp, not gently varying bell curves and not flat topped, as some forecasters have hoped
Post-peak production declines were much greater than our 2% benchmark in some cases
Pre-peaks occurred in three cases.

To understand the possible character of the peaking of world conventional oil production, oil peaking in a number of relatively unencumbered regions and countries was considered. All had significant production, and all were certainly or almost certainly past their peak. The data shows that the onset of peaking can occur quite suddenly, peaks can be very sharp, and post-peak production declines can be comparatively steep (3 - 13%). Thus, if historical patterns are appropriate indicators, the task of planning for and managing world conventional oil peaking will indeed be very challenging.

The author thanks Dr. Roger Bezdek, MISI, Robert Wendling, MISI, Lawrence Kummer, UBS, David Morehouse, EIA, Maria Vargas, NETL, and Jean Laherrere, TOTAL, retired, who all provided very helpful comments on drafts of this study. The final report is solely the responsibility of the author.

This work was sponsored by the National Energy Technology Laboratory of the Department of Energy, under Contract No. DE-AM26-99FT40575, Task 21006W. The author is indebted to NETL management for encouragement and support.

1 Bakhtiari, A.M.S., "World Oil Production Capacity Model Suggests Output Peak by 2006 - 07,"Oil & Gas Journal, April 26, 2004.

3 Skrebowski, C., "Oil Field Mega Projects - 2004,"Petroleum Review, January 2004.

4 Deffeyes, K.S., Hubbert's Peak - The Impending World Oil Shortage, Princeton University Press, 2003.

6 Campbell, C.J., "Industry Urged to Watch for Regular Oil Production Peaks, Depletion Signals,"Oil & Gas Journal, July 14, 2003.

10 Jackson, P. et al., "Triple Witching Hour for Oil Arrives Early in 2004 - But, As Yet, No Real Witches," CERA Alert, April 7, 2004.

11 Davis, G., "Meeting Future Energy Needs," The Bridge, National Academies Press, Summer 2003.

12 Hirsch, R.L., Bezedk, R., Wendling, R., "Peaking of World Oil Production: Impacts, Mitigation, & Risk Management," DOE NETL, February 2005.

13 Hubbert, M.K., "Nuclear Energy and the Fossil Fuels," American Petroleum Institute Drilling and Production Practice, Proceedings Spring Meeting, San Antonio, 1956.

14 Deffeyes, K.S., Beyond Oil: The View From Hubbert's Peak, Hill and Wang, 2005.

15 US Department of Energy, Energy Information Administration, "Long Term World Oil Supply," April 18, 2000.

16 Railroad Commission of Texas, Oil Production and Well Counts (1935 - 2003), www.state.tx.us

The mood among gold bugs is more upbeat than it has been for many years. Gold prices are approaching 18-year highs. Even central bankers, who have been net sellers of gold for the past 40 years, have expressed conditional support for increasing their gold reserves.

Gold dealers have worried for the past two years that the rise in gold prices from their lows of $250 in 1999 would come to an end, simply because gold rallies have not lasted this long since gold was freely floated in 1968. But continued demand for the precious metal has continued to sustain the rally.

"I am getting calls from people I have not spoken to in 15 years asking me about gold," said one Swiss banker this week at the annual London Metal Bullion Market Association precious metals conference in Johannesburg.

In spite of the higher prices, jewelry demand is resilient, while investment demand has picked up through the launch of tracker gold funds, known as exchange traded funds. At the same time, gold mine supplies have remained flat.

Philip Klapwijk, executive chairman of GFMS, the precious metals consultancy, told the LMBA conference that gold was less important to central banks because they were more focused on yield and, with gold lending rates near zero, gold lending activity had dropped. However, central bankers said that gold still had an important role to play in their portfolios.

Mr Klapwijk said gold accounted for about 9 per cent of the $4,355bn of the central banks' global combined gold and foreign exchange reserves. This compared with gold's share of 15 per cent of the $2,011bn in total reserves held at the end of September 1999.

Maria Guegina, head of external reserves management division at the central bank of the Russia, said calculations by the Russian central bank found that about 10 per cent of reserves in gold would be appropriate. This compared with a current holding of 5 per cent, or 500 tonnes.

Central bankers from South Africa and Argentina made similar noises. Kenneth Rogoff, the former chief economist at the International Monetary Fund, told the conference that central banks in Asia that had accumulated large dollar reserves in the past five years should reduce their dollar exposure through diversification into other assets such as gold because there was a greater chance of a "serious global recession, and a higher probability of a nuclear attack on a US city in the next seven years". Such talk is music to a gold bug's ears.

Peter Zöllner, executive director of Oesterreichische Nationalbank, the Austrian central bank, said his bank held more gold than US-denominated assets, even though the bank has halved its gold reserves to about 300 tonnes in the past 10 years.

"Gold continues to be an important asset in a diversified portfolio because it provides stability against US dollar volatility," said Mr Zöllner.

Central bank gold holdings have been one reason why gold is unlike other commodities and is not valued on supply and demand trends, as the 31,000 tonnes in official bank vaults equates to about 10 years of annual demand.

However, official gold sales of about 500 tonnes a year since the Central Bank Gold Agreement in 1999 have helped balance the gold market, as mine production has remained relatively flat for the past eight years and is now not enough to fill annual gold jewellery demand. Gold output has matured among traditional producers - South Africa, the US, Canada and Australia.

David Davis, mining investment analyst at Andisa in Johannesburg, estimates South Africa's 2005 gold output of 300 tonnes to be the lowest level in 80 years, as higher operating costs from rising steel, diesel and labour costs, a stronger rand and declining gold grades have resulted in a 30 per cent fall in gold output in the past five years.

Mr Davis estimates that if no new gold reserves are found, current gold mine supply will fall to less than 50 tonnes in the next 25 years.

October starts, permits fall more than expected in latest sign of softening real estate market.

NEW YORK (CNN/Money) - The pace of home building slowed sharply in October as higher mortgage rates began to bite, a government report showed Thursday, in the latest sign that the housing boom may have peaked.

Housing starts fell to an annual rate of 2.01 million in October from a revised 2.13 million pace in September, the Commerce Department reported, while economists surveyed by Briefing.com had forecast a reading of 2.06 million.

While a pace of 2 million new housing projects a year is still strong, the reading was the second weakest of 2005.

Building permits, seen as a measure of how home builders view the market, sank to an annual rate of 2.07 million from 2.22 million in September, the biggest drop in six years.

The report comes on the heels of surveys of real estate agents pointing to a softening housing market and a separate survey that showed a big drop in home builders' confidence.

Economists said that despite the recent signs of weakness, there was still some life in the real estate market. And even if the housing boom has peaked, that doesn't mean a sharp, dramatic decline in prices or sales is around the corner.

"We're still running at a very good level of activity," said David Seiders, chief economist for the National Association of Home Builders, which conducted the survey of home builders released Wednesday. "But finally we're seeing signs of a topping out and a beginning of what is hopefully an orderly cooling down period."

Seiders said he doesn't expect sharp drop in home building or new home prices going into next year, as long as there is no unexpected downturn in the economy or employment.

"I've been arguing the third quarter was probably going to be the high. That looks like a safe bet right now," he said after Thursday's report.

And another economist said the people shouldn't write off the housing market yet.

"The cries of housing market decline are ramping up again, as housing starts missed consensus," said Gina Martin, economist at Wachovia Securities. "In reality, starts have held steady above 2 million for the seventh straight month, and are quite strong in the face of rising interest rates and falling affordability."

The declines in starts and building permits were broad-based, with every region showing a drop in starts and three of four showing a decline in permits. Only the Midwest, with a small gain in permits, posted any kind of improvement.

Mortgage rates have risen steadily over the last 10 weeks, according to mortgage finance firm Freddie Mac, which now puts the average 30-year loan rate at 6.36 percent, up more than half a percentage point from early September. Higher rates tend to depress demand for housing.

In addition, prices for lumber, concrete and other building materials have jumped in the wake of Hurricane Katrina.

Seiders said the steady rise in new home prices in recent years has also helped put the brakes on building.

"The prices create their own drag on the market; you're creating affordability issues for the people who aren't in yet," he said.

The housing starts report contains no information on home prices. A separate government report last month showed that the median price for a new home fell 6 percent in September to $215,700. Half the homes sold for more than the median and half for less.

The September price was off about 9 percent from the record $237,300 median price hit in February but was still up nearly 2 percent from a year earlier.

[The car culture is always devouring resources that should be going toward Peak Oil mitigation. Ironically, even the decision-making process itself costs millions of dollars in impact studies, legislators’ salaries, advocacy campaigns, and advertising. Here one of the best activists on the Peak Oil horizon puts in his two cents as a local government makes timid but important steps away from a highway boondoggle. –JAH]

The Register-Guard's coverage of the Eugene City Council's recent removal of support for the proposed West Eugene Parkway has omitted important pieces of the story.

The parkway would be a federal-aid highway, not a city of Eugene project. Ultimately, the decision to build or cancel it will be made by the Federal Highway Administration and the Bureau of Land Management. The FHWA is in charge of the federal funds and approval process, and the BLM controls the parklands threatened by the parkway.

The West Eugene Parkway proposal came from the 1950s plan for a Roosevelt Freeway, which was canceled in 1972 because of intense neighborhood objections. Afterwards, the road was scaled back and renamed a "parkway."

In 1996, citizens sued the FHWA for violating federal laws regarding "segmentation" of highway approvals, and the agency withdrew its 1990 approval of the parkway. FHWA officials declined the opportunity to argue their case in court, tacitly admitting the project was illegal.

In June 2001, after it became clear the parkway was an unworkable project, an intergovernmental meeting called "West Eugene Charette" brought together the city of Eugene, Lane County and state and federal agencies to examine the issues. They reached a consensus to select "No Build" and finish Belt Road instead. On July 25, 2001, City Councilor Pat Farr stated the parkway would probably not be built, and that routing some traffic up Highway 99, across Roosevelt and then down Belt Line would be part of the solution, and would require work at key intersections.

The November 2001 advisory vote on the parkway did not require federal agencies to approve it, and it did not allocate any money toward construction. Parkway enthusiasts who spent $120,000 on a media blitz to promote passage of this referendum claimed "the money is there" and said the state would maintain the highway.

After the vote, local governments quietly admitted that the $88 million price tag in 2001 omitted key parts of the project (an expensive interchange with Belt Line). Their most recent official estimate is $169 million, double the cost used to sell the road. The city of Eugene also agreed to assume responsibility for maintaining half of the highway, an enormous unfunded mandate that was not part of the electoral promises.

Since 2001, the Oregon Department of Transportation has spent more millions to study the West Eugene Parkway, but has not been able to find an option that is affordable or legal. In early October, ODOT unveiled its latest parkway version, a revival of the "couplet alternative" rejected by ODOT in 1985 as unworkable and unpopular. This design would route Belt Line traffic onto Fifth and Seventh avenues between Seneca Road and Highway 99, and would add sharp curves and extra traffic lights. (The map in The Register-Guard did not show ODOT's newest proposal.)

The $1.7 million awarded by ODOT over the past year to finish the Environmental Impact Statement is about the same amount of money that would be needed to fix intersections along West 11th Avenue. If the Charette's "no build" consensus had been implemented in 2001, West 11th could have already been fixed, and ODOT could have used the $17 million appropriated for the parkway to finish Belt Line Road (a project approved in 1995). Now that ODOT has essentially admitted defeat with its revival of the failed "couplet" design and the city has withdrawn its endorsement, sensible solutions to west Eugene traffic flow can be implemented.

The West Eugene Parkway is not designed for current congestion snarls, but for traffic problems in the year 2025. The Lane Council of Governments, which crafted the traffic models, predicted last fall that gasoline prices would rise to $2.50 per gallon by 2025. This mistake was rooted in its refusal to look at "peak oil" - the rise and fall of global petroleum production.

Whether peak oil is here now, or is still a couple years in the future, the end of cheap oil will force major changes to transportation planning long before 2025. We will need to ensure existing roads and bridges can be maintained and work at their optimum efficiency, land use must be better coordinated with transportation, and public transit needs substantial improvement.

The most important issues are what economy our region, our country and our planet will have in 2025 when the petroleum supplies will be in decline. Eugene could thrive by focusing on renewable energy, local food production and other industries that will still be able to generate jobs after we pass peak oil.