Stimulating article. Thanks so much for such thought provoking analysis. However, I did have a bit of problem fully understanding your argument because of its focus on production. I think a more robust argument can be developed with a more balanced production-consumption approach. I only say this because of the number of business people I work with who focus on producing goods and services without considering the cost of getting them to market and consumed.



In my view, economic development is not only the result of what resources are available but possibly even more so a consequence of what can be consumed. Chopping wood does indeed wear down tools making this a ready market for anyone who can sharpen them or automate the process.



South Korea makes steel because their shipwrights use so much of it - an internal consumer - and exports it to reduce the unit price. 17th Century England engine manufacturers found a ready market in the coal industry allowing other industries to adopt their products.



In all of these examples there is one common theme, the producer reduces the uncertainty of their consumer achieving a certain task. Once that uncertainty is reduced to an acceptable level other markets can be developed.



This is where US energy policy makes sense. In the face of the uncertainties created by the oil embargo of '73, US policy became one of restriction. But not only. You cannot understand US energy policy in isolation. It has to be viewed within the greater context of de-industrialization. Both the US and UK - followed to differing degrees by other developed nations - pursued very strong policies that moved their economies from production to consumption. Until the Great Recession this was a successful policy that reduced uncertainties for large swaths of the population.



Today, not so much.