Let's not forget that the cause of (or lets say the event that allowed) dictator Suharto's downfall was his attempt to decrease fuel subsidies. The poor and the students rightly got furious, because they depend so much on affordable fuels for their livelihoods.

Wealthy countries like the U.S. and Japan can talk easily, but removing subsidies in India, Indonesia or in other developing countries is obviously very dangerous.

The higher domestic fuel prices will further push up food prices (which, in their commodity form already rose as a result of high crude oil prices) and general inflation.

We are potentially looking at an untenable cycle that could lead to a low-level social war and to the fall of political regimes.

To prevent this, states must subsidize the poor instead, as is being done in Indonesia, where they get a cheque to compensate for the higher fuel prices resulting from the phase out of subsidies. Take away money from the middle class and redistribute it to the poor.

If this mechanism is implemented, then, perhaps, rage can be contained. But without such a counter-balance, you are obviously asking for trouble.

The communist-governed states of West Bengal, Tripura and Kerala, have already announced that they are taking their strikes nationally, and all this because the federal government merely hinted at a 10% rise... We haven't seen anything yet, because when the CPI gets active, it can paralyse India completely.

On the other hand, though, high oil prices are draining states' resources faster than you can say gas.

In early 2007, when oil prices stood at $70, the U.N. wrote:

Recent oil price increases have had devastating effects on many of the world's poor countries, some of which now spend as much as six times as much on fuel as they do on health. Others spend twice the money on fuel as they do on poverty alleviation. And in still others, the foreign exchange drain from higher oil prices is five times the gain from recent debt relief.

Of the 47 poorest countries in the world, 38 are net importers of oil, and 25 are fully dependent on imports.

One can only imagine what the situation is with oil at $140 per barrel... The wholesale destruction of all social progress progress and governmental capacities...

We in the West are poking fun of high oil prices, calling them great news because then we can conserve or buy a hybrid. I have always found this attitude quite obscene. Because high oil prices are actually literally destroying entire developing countries. Affordable fuels are the key to development. Without them, social and economic progress is impossible.

Finally, if states phase out petrol, diesel and kerosene fuel subsidies, we will see a fast rush into biofuels. This would work in many countries with a large agricultural potential. Currently it's their only alternative.

And I agree that there is a smugness among some people in developed countries, which was one of my main points: that there are plenty of subsidies encouraging the consumption of petroleum fuels in those countries as well.

These are only my personal opinions.

If you phase this out and allow the government to keep the money to instead invest in poverty alleviation or health care or other social services, you make a detour via the government. This means money gets wasted, because government programs are less efficient, and, in developing countries, money sticks onto corrupt bureaucratic hands.

The fuel pomp and the kerosine vendor are two points where consumers have direct access to subsidies. Government programs are not that transparent.

lester brown's plan includes shifting from using kerosene (for lighting) to solar (PV).

how long would that take?

A lot of kerosene in developing countries is used for cooking. In some parts of Africa, countries are discovering that it makes more sense to encourage the spread of more efficient (and cheap) improved solid fuel stoves, and to improve the efficiency of charcoal making, then to subsidize kerosene or LPG.

How long would it take to phase out kerosene use in developing countries? I have no idea. But obviously, the more help provided, the sooner the transformation will happen.

These are only my personal opinions.

This is another one where Larry David's "do-the-opposite" principle would apply.

Take the subsidies away from big oil (and coal and nuclear) and give them to the junkies that are willing to go into rehab.  with solar panels, geo heating/cooling systems, plugin cars and bikes, wind farms and biogas (on the farm or community garden).

Actually pay the addicts to switch to less oily living.  Per kwh that their devices generate (or conserve) and sell baxck to the grid.

http://amazngdrx.blogharbor.com/blog John Schneider, Northern Wisconsin

China has a national oil company investing in Alberta tar sands production.  Do the chinese drivers get their gasoline, from that oil, at retail or wholesale?   Was gasoline 10 cents per gallon under Saddam in Iraq.

With a government owned company it is the service it provides to the nation that is the profit, the bottomline.  Not the same thing as a private company, their profit must keep going up quarter after quarter to the sky.

This allows the government to fix gas prices within their own country at whatever point they want.  completely circumventing so-called "free" markets.  How long until that manipulation of commodoty prices and the national currency itself constitutes unfair competition on the global economic stage?

China is already there, they have been masters of this for decades.

National ownership and control of the economy has its advantages from this angle, international trade and currency.

So why not nationalize the oil companies and just put that gas price back to 3 buckes per gallon?  This is an emergency, just like WW2.  Right?

Because multi-nationals like exxonmobile have become independent from any one government.  By doing that they protect their power and wealth from national control.

Russia and China have nationalized industries, that invest all over the planet.  What do we have?  Leadership that answers to multi-national corporate power and uses we the people like corporate chattel.

Russia and China own their industries, our industries own US.  Wouldn't it be better to return to the founder's vision?  We the people owning the industries and the government.

That would be a nice change.

http://amazngdrx.blogharbor.com/blog John Schneider, Northern Wisconsin

For the nearly 1.6 billion people living in communities not yet connected to an electrical grid, it is now often cheaper to install solar cells rooftop-by-rooftop than to build a central power plant and a grid to reach potential consumers. For Andean villagers, for example, who have depended on tallow-based candles for their lighting, the monthly payment for a solar cell installation over 30 months is less than the monthly outlay for candles.

Villagers in India who are not yet connected to a grid and who depend on kerosene lamps face a similar cost calculation. Installing a home solar electric system in India, including bat- teries, costs roughly $400. Such systems will power two, three, or four small appliances or lights and are widely used in homes and shops in lieu of polluting and increasingly costly kerosene lamps. In one year a kerosene lamp burns nearly 20 gallons of kerosene, which at $3 a gallon means $60 per lamp. A solar cell lighting system that replaced only two lamps would pay for itself within four years.

that's lester's point. mine was to ask, given the many options, and, say, 20 years to finish and 5 to get started, how much household, local, regional, and national replacement could be done how soon. as with here, shifting subsidies to the consumer, ostensibly to refocus from the means to the ends, means the consumer has some options, in a democratic process. if people are going to pick a path, they need paths to pick from, and they need to know how quickly those paths will be available.

I cannot answer your question of how much household, local, regional, and national replacement could be done how soon. Anybody else care to answer?

These are only my personal opinions.

So let's get real, shall we?

Micro-hydro works sometimes, wind is more difficult, PV is out of the question.

You would need massive subsidies to make solar photovoltaics work.

Costs for panels and batteries have to come down 25 fold for this technology to make a dent.

I know many people are short-sighted and don't like to think long-term, but if what they care 'bout is the lives and livehoods of people, then they must realize that the sooner the transition away from fossil fuels takes place, the more lives that will be saved in the long run.  And nothin' helps spur that transition like very high prices.

Eventually the markets and the rising price of oil will bring the world economy into recession. (Arjun Murti of Goldmann thinks $150-$200 will do it.) But if governments acted in concert to reduce demand then the oil price could be brought down. For instance, if each country agreed to reduce it's oil consumption by x% per year, OPEC would surely listen. The value, x, could be adjusted to bring about stable oil prices that can help the world negogiate oil depletion.