Uncontroversially, U.S. domestic oil production has been declining for roughly 40 years now, yet public policy still subsidizes its consumption (see Peak Oil 101), and, as every free-market economist will tell you, a subsidy means we over-consume it.

What could solve the growing divergence between our domestic energy supply and energy demand?

We could continue what we have been doing:

Subsidizing oil ($300 – 550 billion annually — this last is from the Financial Times)

Fight resource wars for overseas oil

Or we can start building a society with more sustainable policies:

Conservation

European building codes require the “passivehaus” standard of construction. Essentially, building to this standard means a building consumes no net energy.

Amory Lovins reports that conservation is competitive with conventional energy sources now, and enlightened companies understand cutting waste gives them a competitive edge.

Food

A recent U.N. study found that raising livestock caused more climate change than all human transportation combined. Currently U.S. agriculture is not even “solar.” We burn ten calories of petroleum to produce one calorie of food.

Anna Lappé’s Diet for a Hot Planet systematically debunks all of the objections from the unsustainable industrial agriculture that currently dominates our food supply. Objections that food would necessarily be more expensive, or less plentiful are all demonstrably false.

Public policy has an enormous impact. Farm subsidies amount to 40% of U.S. agricultural income. Michael Pollan quotes one farmer saying “It’s just like laundering money for Cargill and ADM” (two agribusiness giants).

How sympathetic are Cargill and ADM to American consumers? Not too long ago their executives did some jail time for an illegal conspiracy to fix prices.

Personal action here would have enormous impacts. Despite what you hear about our population eating less meat, livestock consumption is up five-fold since the 1950s. See Dr. Barnard’s healther diet here.

Cities

Building cities in sprawl — so all the different “uses” (stores, homes, offices, etc.) are in widely separated locations has been the American development pattern for the last half century. That does not, however, follow traditional settlement practices. Traditionally, neighborhoods mix uses — a corner store with offices or residences upstairs is common. They also connect the different uses with pedestrian-friendly streets. In England, even highways come with foot paths.

Public policy is important here, too. The misguided sprawl planning and building codes need to be replaced by “Smart Codes.” If FNMA changed its loan underwriting standards to require smart codes guide any new development, the U.S. would stop building sprawl, and start building traditional villages virtually overnight. It takes one to raise a child, you know.

Such development would not only have the beneficial effect of reducing vehicle miles travelled (between one-third and two-thirds), it would make the inhabitants healthier (they could walk to real destinations), and would lay the groundwork for transit. Who believes transit will ever work in sprawl if people can’t walk to the stops?

As for those 100-mile-per-gallon cars, we have them now. They’re called “buses.” Building sprawl insures all transit must be subsidized. In traditional mixed-use, pedestrian-friendly neighborhoods, transit can actually be profitable. Bicycle amenities would help existing sprawl. Current transportation spending favors highways above all else, though.

Skeptics may believe transitioning to renewables is impossible, or would mean a return to stone-age living, but Europeans and the Japanese live modern-age lives consuming only half the energy the U.S. does per dollar of GDP. It’s more than possible; it’s necessary.

Adam Eran