Per Capita Peak Oil Was In 1980?

Is what really matters to global oil prices peak oil? We may be on the brink of this now globally (it has been reached by many individual producers long ago), but it may be in the near to decade or two future depending upon who you talk to if we haven't reached it.

Or, is what really matters per capita peak oil? This arguably happened around 1980, and is only going to reverse if the global population starts growing more slowly than oil output, raising the bar for the oil industry to keep up.

I suspect that the number of people who live in industrialized economies or post-industrial economies is what really matters. Population growth in these economies is generically lower than global population growth rates, but it is growing because this is a function not just of natural increase, but also of economic development which is in two steps forward and one step back fashion gradually spreading to larger and larger parts of the economy.  Since economic development is harder to predict than population growth, the trendline is harder to predict.  Still, both population growth in the existing industrial and post-industrial world as a whole is probably positive for the foreseeable future and economic development is also likely to be more than zero, so oil prices are likely to have more demand pressure in the future as well as more supply pressure in the future.  Hence, the measure of oil demand relative to supply that matters to global oil prices is likely to hit before peak oil does (if it hasn't hit already) and still sets a higher bar for oil produces to meet in terms of new production to keep oil prices moderated.

Equally important to this dynamic, of course, is that cheap oil may make economic development easier and cause the number of nations or subnational areas that are industrialized to grow more rapidly. But, peak oil driven price increases for oil may slow the industrialization phase of economic development. Thus, projecting future oil prices as a result of predictable supply and demand factors has self-interacting components.

The biggest wildcard is breakthough technology.  New oil exploration and extraction technology could provide downward price bumps.  But, the real game changing issue is whether technologies with a big impact on oil consumption take hold. 

In practical terms this means mass conversion from gasoline and diesel powered vehicles to alternative fuel vehicles like electric cars, or dramatic increases in fuel efficiency from developments like plug-in hybrid vehicles and increased public transportation usage (particularly involving bus usage).  Electric and plug-in hybrid vehicles of one sort or another are probably the only way that global oil demand can drop enough to counteract the long term price pressures that oil faces from an increasingly large industrialized world population and stagnating long term oil production as economically extractable supplies are exhausted.  Transportation is the dominant source of oil demand in the industrialized world that otherwise gets its energy from other sources as environmental and price factors have made oil based fuels less attractive for uses where alternative energy sources are technologically viable.  So these technologies have the dominant impact on oil demand per person in the industrialized world.

READ MORE - Per Capita Peak Oil Was In 1980?

Property Rights In Water Working In Colorado

Colorado Public Radio, today, has an interesting story on the phenomena of "buy and dry" in the state, in which farmers sell their water rights (often for millions of dollars from farms that are marginally productive agriculturally and have no clear successors to farm them) to municipal water systems that need to water to support expanding urban populations.

The practice has virtually ended farming in some rural counties. Initially, there was a concern that simply cutting off water without considering the environmental impact of doing so would lead to swaths of infertile dirts that were a blight on the state and cause rapid economic collapse without warning in rural communities. More recent legislation in Colorado has mandated that the buyers of water rights in buy and dry transactions must establish and fund a thirty year mitigation plan that returns the previously farmed land to a state where it is a sustainable prairie and provides payments in lieu of taxes to the impacted governmental units to reflect the revenue losses that they experience as a result of the lost agricultural economic activity.

On balance, it is an example of property rights, accompanied by reasonable government regulation, protecting the legitimate interests of all involved while putting our arid state's scarce water resources to their highest and best uses.

READ MORE - Property Rights In Water Working In Colorado

Peak Dirt

One of my father's favorite sleeper environmental issues is top soil erosion, a.k.a. "peak dirt." FT Alphaville has a lengthy post discussing the subject in the context of limits on sustainability.

READ MORE - Peak Dirt

Pew Offers Up New Political Typology

For the fifth time in 24 years, the Pew Research Center has done cluster analysis of survey data (broken down on nine ideological dimensions) to break the U.S. political spectrum into subtypes that capture some of the main intrapolitical party factions in political ideology and identity. The analysis differs substantial from their previous breakdown in 2005.

Both studies classify about 10% of the population as "bystanders" who are politically apathetic, identify three Democratic leaning clusters, three Republican leaning clusters, and two other moderate clusters.

In 2005, the Democrats were divided into Liberals (secular and anti-war), Disadvantaged Democrats (social welfare loyalists), and Conservative Democrats (latter day New Dealers). The Republicans were broken into Enterprisers (Staunch conservatives), Social Conservative (religious, critical of business), and Pro-Government Conservatives (struggling social conservatives). The politically involved moderates were classified as Upbeats (positive outlook and moderate) and Disaffected (working class and discouraged).

In 2011, Pew finds two Republican clusters: Staunch Conservatives (highly engaged tea party supporters), and Main Street Republicans (conservative on most issues); three Democratic clusters: Solid Liberals (across the board liberal positions), Hard Pressed Democrats (religious, financially struggling), New Coalition Democrats (upbeat, majority-minority); and three politically active moderate clusters: Libertarians (free market, small gov't seculars), Disaffected (downscale, cynical), and post-moderns (moderate, but liberal on social issues). But, as it discusses in its analysis, the two Republican clusters are very similar to each other, and two of the three political active moderate clusters have weak but clear partisan leanings.

The realignment partially reflects a Republican loss of seven percentage points of population share in favor mostly of moderates, presumably into the Libertarian and Disaffected categories.

According to Pew:

[A] growing number of Americans are choosing not to identify with either political party, and the center of the political spectrum is increasingly diverse. Rather than being moderate, many of these independents hold extremely strong ideological positions on issues such as the role of government, immigration, the environment and social issues. But they combine these views in ways that defy liberal or conservative orthodoxy. . . .

The most visible shift in the political landscape since Pew Research’s previous political typology in early 2005 is the emergence of a single bloc of across-the-board conservatives. The long-standing divide between economic, pro-business conservatives and social conservatives has blurred. . . .

On the left, Solid Liberals express diametrically opposing views from the Staunch Conservatives on virtually every issue. While Solid Liberals are predominantly white, minorities make up greater shares of New Coalition Democrats – who include nearly equal numbers of whites, African Americans and Hispanics – and Hard-Pressed Democrats, who are about a third African American. Unlike Solid Liberals, both of these last two groups are highly religious and socially conservative. New Coalition Democrats are distinguished by their upbeat attitudes in the face of economic struggles. . . .

Libertarians and Post-Moderns are largely white, well-educated and affluent. They also share a relatively secular outlook on some social issues, including homosexuality and abortion. But Republican-oriented Libertarians are far more critical of government, less supportive of environmental regulations, and more supportive of business than are Post-Moderns, most of whom lean Democratic.

Disaffecteds, the other main group of independents, are financially stressed and cynical about politics. Most lean to the Republican Party, though they differ from the core Republican groups in their support for increased government aid to the poor. . . .

[T]he nature of the partisan divide has changed substantially over time.
More than in the recent past, attitudes about government separate Democrats from Republicans . . . In 2005, at the height of the Iraq war and shortly after an election in which national security was a dominant issue, opinions about assertiveness in foreign affairs almost completely distinguished Democrats from Republicans. Partisan divisions over national security remain, but in an era when the public’s focus is more inward-looking, they are less pronounced. . . .

• More Staunch Conservatives regularly watch Fox News than regularly watch CNN, MSNBC and the nightly network news broadcasts combined.
• There are few points on which all the typology groups can agree, but cynicism about politicians is one. Majorities across all eight groups, as well as Bystanders, say elected officials lose touch with the people pretty quickly.

Two of the main issues dividing the Republican clusters are the feeling that businesses make too much in profits and support for environmental regulation, also common in Main Street Republican, both common in Main Street Republicans but not Staunch Conservatives, while they are united on religion, immigration and the view that the social welfare net is too expensive. The Democratic party has more ideological diversity between its clusters.

Particularly notable is the disappearance of the once prominent "pro-government conservative" faction from the Republican clusters. Indeed, both of the Republican clusters and two of the three political active moderate clusters, and at least one of the Democratic clusters are pretty down beat on government in general.

The desirability of environmental regulation has become an intraparty divide for both major American political parties (and amongst different moderate clusters), rather than an interparty divide.

READ MORE - Pew Offers Up New Political Typology

Prenatal Environmental Exposures Produce Mental Health Harms

Researchers found that within a sample of 215 children monitored from birth, those children with high levels of a pollution exposure marker in their cord blood had more symptoms of attention problems and anxiety/depression at ages 5 and 7 than did children with lower exposure.

The researchers measured a biologic marker or "fingerprint" of exposure to polycyclic aromatic hydrocarbons (PAH) and other combustion-related pollutants in newborns' cord blood. When inhaled by the mother during pregnancy, these pollutants can be transferred across the placenta and bind to the DNA of the fetus, forming "adducts" in blood and other tissues and providing a biologic measure of pollutant exposure. Mothers completed a detailed assessment of their child's behavior.

In urban air, traffic emissions are a dominant source of the pollutants measured in the study. The authors accounted for other sources such as environmental tobacco smoke and diet in their analyses. None of the mothers in the study were smokers.

From here citing Frederica P. Perera, Shuang Wang, Julia Vishnevetsky, Bingzhi Zhang, Kathleen J. Cole, Deliang Tang, Virginia Rauh, David H. Phillips. PAH/Aromatic DNA Adducts in Cord Blood and Behavior Scores in New York City Children. Environmental Health Perspectives, 2011; DOI: 10.1289/ehp.1002705.

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Republicans For Pollution

Republicans are insisting in budget negotiations on continuing to add to global warming, allowing cement makers to add mercury to the air, keeping the Chesapeake Bay polluted, and allowing coal companies to conduct mountaintop removal mining. 

Who knew that the Tea Party movement was really a mass outpouring of support for more pollution?  They want to shut down the government over these issues?  I don't think that they'll win any political wars in a government shutdown by going to the barricades for utility companies, air pollution and the right of corporations to create Appalachian moonscapes.

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Ancient Rome v Pre-Industrial London

In "The Fall of Rome: And the End of Civilization," Bryan Ward-Perkins reports that the pollutants which are the byproducts of industrial activity did not reach Roman levels in Britain until the 18th century! I am not naive enough to be such a partisan of the “ancients” as to suggest that Europe did not reach Roman levels of civilization in the generality until the 1700s. But, up until the Industrial Revolution occurred in Britain there were aspects of European civilization which had not yet climbed back up to the Roman scale of grandeur or virtuosity. For example, it seems that it was only in 1800 that London attained the size of the city of ancient Classical Rome (which had fallen in its nadir in the 7th century to a population of 50,000).

- Per Razib (links omitted, punctuation added in lieu of link emphasis).

READ MORE - Ancient Rome v Pre-Industrial London

Dex v. Seattle

Dex, a distributor of phone books is challenging a Seattle ordinance allowing people to put themselves on a "no phone book" list, as a violation of its First Amendment rights in a suit filed November 15.

I have about eight phone books in a cabinet in my house that almost never get used for anything. My children show no interest in learning how to use one, my wife doesn't like the small print. I use one half a dozen times a year, and don't use three-quarters of the phone books I receive at all. I'm a phone book advertiser myself, but increasingly even they are pitching the Internet component of their business, rather than the paper copy element.

Opt-out laws, in general, have been upheld against constitutional challenge in multiple cases cited in the link above to a post by Venkat Balasubramani at Eric Goldman's blog including Rowan v. United States Post Office, 39 U.S. 728 (1970)(indecent junk mail); State of Mo. v. American Blast Fax, Inc., 323 F.3d 649 (8th Cir. 2003)(junk faxes); FTC v. Mainstream Marketing Services, 345 F. 3d 850 (10th Cir. 2003) (no call list).

The main constitutional objections raised by the Yellow Book companies to the statute are that:

- the statute singles out yellow pages from all other types of unsolicited pamphlets, without reference to the harms sought to be remedied;
- the City made exceptions to satisfy local business interests, such as business associations;
- the ordinance also contains a licensing scheme which is at best highly suspect;
- the statute compels the yellow pages publishers to publish an unwanted message (in the form of opt-out notices and messaging on the cover)
- the statute charges the yellow pages companies to dispose of the books even though the unwanted or discarded books are recycled or disposed of by the recipients;
- yellow pages companies already employ opt-out mechanisms and have no interest in delivering yellow pages to recipients who do not want them (there's no indication that the opt-out system set up by the City will be more effective).

The objection to a statute that involves yellow pages being a content based restriction that favors local interests isn't particularly strong, because the content basis ties into the resident choice to be on the opt-out list, and any flaws in it could probably be easily remedied with an improved definition (e.g. printed material of 150 pages or more with commercial content not expressly requested by the resident, not distributed by an organization of which the resident is a member, and not delivered by the U.S.P.S.).

Any problem with the requirement of a $100 license fee, the reporting requirement (to list the number of yellow pages distributed), or the unwanted message also seems doubtful, particularly to the extent that any defect in the definition of yellow pages is cured. All sorts of businesses are required to make disclosures about laws that have an impact on them, the reporting requirement is no more onerous than constitutional requirements applied to every periodical distributor, and the license fee is not out of line with business privilege licenses that apply to all businesses (and could be made a part of a general business privilege license by requiring the fee and disclosure of yellow book distributions to all business license holders). Allowing licenses of regulated businesses that don't comply to have their licenses yanked also seems constitutional.

No of the prior law on opt out has ever suggested that a private opt-out option makes it constitutionally impermissible to have a legally required opt-out option, and there is good reason to think that a government administered one would work beter.

The most interesting challenged provision is that one that provides for "a 'recovery fee' designed to recoup recycling costs ($0.14 per book and $148.00 per ton of yellow pages)." Similar costs are imposed on tire companies and oil change companies, and it is hard to see how this fee is materially different from a constitutional perspective. Arguably, this makes the content discrimination claim stronger, but one alternative would be to apply the fee of $148.00 per ton to all unsolicited paper (something on the order of 40,000 to 200,000 pages) distributed (for profit or in excess of a certain number of pages or both) outside the U.S. Postal System (where federal pre-emption probably applies). While this fee would be a notable burden on yellow page companies, it would still be a modest part of their total production costs, would be very modest when applied to other door to door flier distributors.

On the whole, the Seattle law seems either constitutional or easily remedied, sensible, and worth considering duplicated in Denver once constitutional concerns are resolved in Seattle's case.

READ MORE - Dex v. Seattle

Twenty Obvious International Trends

Lots of economic, environmental and political predictions are hardly better than horoscopes. Others are reliable enough to be thought of a "fundamentals." I'm more interested in the latter. Here are a few:

1. China's economic growth rate will be greater for medium term time periods (e.g. three years or more) than that of the United States for the foreseeable future, because it is engaged in "catch up growth," while the United States is not.

2. China will experience a notable economic crash in the next decade or so, because it hasn't had one for a long time and periods of even strong sustained growth are almost always interrupted periodically by economic crashes.

3. India's economic growth rate will be greater for medium term time periods than that of the United States for the foreseeable future, because it is engaged in "catch up growth," while the United States is not.

4. India's economic growth rate will exceed that of China sometime in the next ten to fifteen years, because China's per capita GDP is significantly greater than that of India, leaving India with more "catch up growth" potential than China.

5. Oil dependent nations in the Middle East will each experience serious economic contractions not long as oil production in the nation in question starts to fall due to exhaustion of the nation's oil supply. These nations are heavily reliant on oil revenues to sustain their standard of living with imported goods and temporary immigrant workers, both of which will be harder to come by when there are not new oil revenues available.

6. Countries in Africa that experience war and authoritarian governments will experience less economic growth than those with sustained periods of peace and democratic government.

7. In the developing world, it will be a long time before environmental and climate change concerns have enough political clout to cause air pollution to be reduced more rapidly than the increasing scope of economic activity increases air pollution. As a result, emissions will not be reduced rapidly enough to stop continued global warming.

8. Nuclear power will spread to more countries.

9. Oil more be more expensive in real terms in 2020 and more expensive again in real terms in 2030 than it is today. Rising oil prices will make technologies that are powered by energy sources other than oil more attractive. This trend will be a global one, because oil trades in a global marketplace.

10. Oil rich countries that are not close to exhausting their reserves will receive an economic boost from rising oil prices.

11. North Korea's political and economic system will collapse, probably within a couple of decades, if it fails to open itself up to the rest of the world. If it does collapse, it will probably be reabsorbed by South Korea.

12. Public health measures will improve in most of the developing and undeveloped world that are not war torn as patents on new effective drugs expire and make those drugs more affordable.

13. Global fertility rates will fall as more countries become more economically developed.

14. Developing countries will become less religious as they become more economically developed in fairly close synch with falling fertility rates.

15. The need to impose taxes as oil revenues decline will force Middle Eastern monarchs who have not already been deposed in revolutions and democratized of their own free will to make genuine democratic reforms.

16. The proportion of the world population engaged in farming will fall steadily for decades to come.

17. Some small island nations will be swallowed up by the sea and forced to relocate all or most of their populations as sea levels rise with global warming sometime in the next century.

18. A large share of the world's languages, probably half or more, will die in the next few decades.

19. A significant number of plant and animal species will go extinct in the next few decades.

20. The proportion of Africans who are Christians will increase significantly over the next decade.

READ MORE - Twenty Obvious International Trends

Cities are more efficient

The bigger the city, the more output it produces per capita and the fewer resources it needs to do so.

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The Good News Of The Last Decade

Rather than coming up with my own good news from the last decade, which I'm not disposed to do with the front page story in the paper is Republican plots to repeal health care reform, I'll crip off others including science fiction writer Charles Stross who notes:

1. AIDs is treatable.
2. "[B]oth China and India underwent annual economic growth averaging around 10% per year throughout the decade. The number of people living in poverty and with unsafe water supplies world-wide today is about the same as it was in 1970. Only difference is, there were 3 billion of us back then and today we're nearer to 7 billion. Upshot: the proportion of us humans on this planet who are living in third world poverty (unable to afford enough food, water, clothing and shelter) has actually been halved."
3. "Africa averaged around 5% growth throughout the decade, too." Some haven't shared in those gains due to events like the Congo War, but those who escaped wars have come out far better than that average.
4. "we haven't nuked ourselves." We have had the longest time period (about sixty years) without an international war in Europe since the Roman Empire, and the number of people living in war zones dropped greatly in the last decade on top of further drops after the Cold War.
5. Computer technology is faster, has greater broadband speed, has more storage capacity and in cheaper by orders of magnitude from a decade ago.
6. Genetic science has advanced greatly.
7. The pace of terrorism seems to have slowed down in the first world.

And, I'll also turn to "The Big Picture" which notes:

1. Cell phone use has gone from rare to predominant.
2. Internet use is way up.
3. U.S. population density is modestly up and U.S. power consumption is modestly down. In part driven by rising oil prices.

But, the environmental picture is still bleak. Global warming continues and is speeding up, more species are endangered, and natural disasters have been worse in the last decade than in the decade before it.

Economically, the good news is that things aren't getting worse in employment or GDP. The bad news, however, is that employment isn't improving very fast.

READ MORE - The Good News Of The Last Decade

Dish Soap Secretly Reformulated

This summer, detergent makers took phosphates out of their detergents. Seventeen states banned phosphates from dishwasher detergents because the chemical compounds also pollute lakes, bays and streams. They create algae blooms and starve fish of oxygen.

The result is a noticable reduction in the effectiveness of dishwashers at getting dishes clean.

I understand the importance of reducing the amount of toxic material that goes into our waterways. Apparently, they were removed from laundry detergents years ago. We will learn to live without them. I also understand that it can be commercially impracticable to offer different versions of a mass produced consumer product in different states.

But, it is really unconscionable for Procter and Gamble and other dishwasher detergent companies to make a major reformulation of a product used by many tens of millions of people every day that significantly changes its functionality for the consumer without boldly and prominently disclosing that to the general public. This should have been something that everyone knew about before it happened and that everyone with a dishwasher was innundated with suggestions for adjusting their daily habits to managing. Instead, no one I know was aware that this had happened until today, several months after the change took place. Many people, like the woman interviewed for the story, simply started to see a change in how clean their dishes were coming out of the dishwasher and assumed that their dishwasher was broken.

The cardinal rule for managing change is to do so democratically. You need to involve everyone affected and everyone needs to know about it. Not everyone has to agree. But, everyone needs to know and have an opportunity to comment.

Living in a large metropolitan area, my life is full is mysteries and half finished bits of stories. An ambulance rushes bye to some emergency that will change someone's life forever, but will never receive even a paragraph's mention in the newspaper or TV news. You overhear an intense conversation on a light rail trip that never gets resolved. Businesses in your neighborhood open and close without explanation. My daughter's middle school was locked down this morning based upon a threat that was received yesterday, according to a Robocall that I received from the Denver Public Schools this morning. But, I'll probably never hear another word about what happened or why.

Only a true policy wonk can personally have any real sense of what is contained in the roughly six hundred bills introduced in the Colorado General Assembly every year, all of which are processed in a short 120 day session, and it is a real challenge to follow even the bills in one committee despite live Internet feeds of committee procedings and online bill status indexes updated daily. Ad city council and Congress, and one can only hope that intermediaries that you trust will tell you how the laws are changing. And, I have the privilege of living in Denver where the structure of the government is far more streamlined than it is in most places because we have a conslidated city and county government with a school district that has contiguous boundaries.

But, when something actually does directly change your life, even in little ways, you would really like to know what is going on.

READ MORE - Dish Soap Secretly Reformulated

Puzzle Solving v Problem Solving

The New York Times published a letter today from my dad about its conflation of "puzzle solving" and "problem solving" in one of its articles.

To the Editor:

Puzzle solving is a very small subset of problem solving, and the two should not be equated at all. I will not dispute that there is a particular kind of creativity involved in solving puzzles, but it is not at all the kind of creativity needed to solve problems.

Gene E. Willeke

Oxford, Ohio

From the New York Times (November 14, 2010).

One of the core courses that my dad taught his Master's Degree students in Environmental Sciences over his many decades as a professor was a course on problem solving. The environmental problems that his students were learning to solve, however, were rarely of the puzzle variety.

The publication of his letter is also notable, as both he and I have now been mentioned in this particular newspaper this year. The lesson in both cases is that brevity is the key to getting published in the popular press.

READ MORE - Puzzle Solving v Problem Solving

How Will We Use Vacant Public Space?

Empty Public Space Abounds

Denver is littered with grand old churches that are empty or have Congregations of a few dozen in edifices built for many hundreds.

The Denver Public Schools has far more space in schools than it has students, a few neighborhoods have overcrowding (like Green Valley Ranch and Stapleton) while other neighborhoods have a particularly great excess of empty school space. My neighborhood has the old Beyer's School (once home to Denver School of the Arts which relocated to fill part of an abandoned North Campus of the Universty of Denver, the rest of which was filled with Johnson and Wales University) looming over it and fervantly seeks to make it the home of a new Denver School of Science and Technology Charter School.

As the volume of mail sent via the postal service declines in favor of e-mail, one by one, post offices are going to sit vacant. Budget cuts have left communities like Aurora and Colorado Springs, and even Denver, unwilling or unable to keep recreation centers open, leaving more public spaces vacant. As multiplexes replace humbler theaters, the old theaters have had to find new uses. Dead malls lurch quietly. And, the declining rolls of service clubs from the Masons to the Eagles chronicled most famously by Robert Putnam continue to dwindle, their lodges and halls sit underused or empty. Converting old public spaces into private ones is a growth industry.

Taken together there is a lot of empty public space.

New Uses

Sometimes, old churches and public spaces become lofts. S. Broadway has a church converted to lofts at about 1st Street, University Boulevard has another church converted to a residence at about 5th Street, 10th Street in Congress Park features an old fire station converted to residences. There is an old school converted to residences near Old South Gaylord in Washington Park. The home can be delightful, but it is also a shame to see public space become private.

The old late night post office and mail sorting facility in LoDo was replaced by a shiny new, eco-friendly EPA building. In my home town, Oxford, Ohio, an old post office became a municipal court.

Train stations are seeing a renaissance, ironically, as train stations, mostly supporting metro area transit rather than intercity rail, although rejections of federal high speed rail funds in Ohio and Wisconsin, and indifference towards them in New Jersey and Florida, makes Colorado's hopes of securing some of these funds look like less of a pipe dream. Denver's Union Station is already well in the process to be restored to glory as a transportation hub (even as the Greyhound Station looks for a new home).

The dead malls at Cinderella City (in Englewood, Colorado) and Villa Italia (in Lakewood, Colorado) were razed and replaced with mixed use neighborhoods, in the case of Cinderella City, complete with a new city hall and library.

Movie theaters have found mixed dispositions. Some, like the Esquire and Mayan have been subdivided into multiscreen art house theaters. One at S. Colorado Boulevard and Alameda in Glendale became a gym. One on S. Broadway was converted into a climbing gym. Several have been converted into venues for live rock band performances. One on Federal Boulevard was converted into a missionary megachurch.

Libraries are beautiful public spaces, but I can't think off hand of what has become of any of them, despite the fact that I know some that have closed fairly recently, and others that are at grave risk of closing.

An old grocery store, converted to a church, near East High School, originally slated to become a new Central Denver Recreation Center, has wound up for the time being, as a community garden and dog park instead. Across the street, an old live theater has been converted into a book store, record store and restaurants, as well as a movie theater that died and since has been reborn with the Denver Film Society relocating there from Tivoloi on the Denver's Auraria campus.

Challenges To Come

This, of course, only scratches the surface of the general issue of finding new uses for no longer needed properties. Greater Denver has a variety of spaces that need repurposing.

Old Saint Luke's Hospital has now become Post Properties in the rechristened Uptown, and Old Elitch Gardens has become a residential development (which defeated efforts to have a Wal-Mart put in their neighborhood, only to have one spring up ten blocks down the road in Lakeside). The old Children's Hospital Campus is reportedly going to be the home for a new Saint Joseph's hospital, because its existing tower has fire code issues.

But, the disposition of the old University Hospital, abandoned in part of the effort to remake the old Fitzsimmon's military base and turned over to a redevelopment company, is not yet clear. In a year or two when Saint Anthony's Hospital off Colfax in Northwest Denver relocates into its under construction new facility, there will be yet another big hole for Denver to fill in a space where the impetus for new development has not been as vigorous.

A defunct public school which has passed from one speculative investor group to another in the Golden Triangle remains vacant. Ironically, the neighorhood has transformed enough that it could really use a school again, although that use for the space seems unlikely.

Denver also has its brownfields. The financial crisis stalled the redevelopment of the Old Gates Rubber Plant, but sooner or later, it will have to find a new use. I know of a couple of families who have turned old industrial buildings in North Denver into residences and art studios. Between Sante Fe and Kalamath a few blocks North of Alameda, old industrial properties have been repurposed to be a micro-distillery and a Hispanic cultural center. Another old public building near the Auraria campus off Colfax was also repurposed to be a cultural center. Perhaps this trend will continue.

The Coming Inversion Of Center And Fringe

Maybe Denver proper will be O.K.

Infill construction has continued steadily while suburban Denver construction came to a screeching halt. The rising price of gas, increased dissatisfaction with long commutes, and increasing public faith in the Denver Public Schools, represented most recently by a remarkable surge in middle school enrollments may fuel an influx of new people to the central city. For most of history from the Middle Ages until the construction of street cars, central cities were considered more desireable than the urban fringe. Street cars created street car suburbs, like Washington Park. Interstate highways pushed attractive housing even further away from the core for a generation or two. But, the trend seems to be reversing itself. It may be only a matter of time before the metro area's ghettos are in Highland's Ranch instead of already gentrifying Five Points.

READ MORE - How Will We Use Vacant Public Space?

The Economics of Place

Suppose that the 300 million people who live in the United States were all bunched together at the population density of Brooklyn. And for those not familiar with it, Brooklyn is certainly not the most densely populated part of New York City (that would be Manhattan). Denver's Capital Hill neighborhood, for example, is more densely populated than Brooklyn. So, how much space would it take to fit the population of the United States in one place at Brooklyn's population density?

Answer: About the land area of New Hampshire "with extra room for parks (because Brooklyn could use more)."

Of course, not all activities necessary for the survival of the United States economy and civilization can function at that population density. A big chunk of the United States is farmland and the 2%-3% of the population in the farm economy would have to be spread out to tend those farms. Likewise, another 1%-2% or so of the population is engaged in harvesting lumber, fishing, and mining, which likewise have to be undertaken where the resources are located.

Even these intensely location dependent industries continue to grow less labor intensive. Less than half of all farms produce a very large share of all agricultural output in the United States. Shrinking wild fish resources mean that in the future there will be fewer fishermen. Recycling has muted the demand for newly mined metals. An increasingly paperless world needs less pulpwood than it used to require. Energy efficient technologies have reduced the amount of energy consumed in the course of making each $1,000 of GDP.

But, for the most part, location is a matter of choice. Historically, for example, car factories and other heavy industry in the United States was located in Rust Belt in cities like Detroit, Flint, Toledo, Cleveland, Buffalo and Pittsburg. But, there's nothing sacred about that today given the much reduced cost of transportation. A new automobile assembly plant was recently built in Mississippi, and the old guard of internal combustion engine automobile makers recently handed over an automobile assembly plant in California to a new guard company set on making electric cars. Some of the cars you see on the street were made in Japan (which is famous for its utter dearth of natural resources) and Germany, both of which are half a world away, even though a car is one of the heaviest goods (and hence most expensive to transport) that the average person owns other than a home. Vehicles are made in North American both in Mexico, just across the border from El Paso, Texas, and in Ontario, just across the border from Buffalo and Detroit. Manufacturing enterprises have immense freedom to locate pretty much anywhere they want, subject to very modest constraints.

Most of the economy, retail trade, hotels, branch commercial banking, gas stations, post offices, schools, hospitals, construction, government, and so on, needs to be located conveniently to the people who buy the goods and services they offer but aren't intrinsically connected to any particular place. There is very little that is done in Denver that couldn't be done just as functionally in Fort Collins or Colorado Springs had the path of history taken a slightly different step.

We also have quite a few industries where geography is absolutely critical, but it is critical because the industries operate in national or international marketplaces where proximity to industry colleagues is critical. New York is the center of the American investment banking industry because it started there and never left, and because there is considerably value in that industry in being able to have face to face meetings with other members of the investment banking community on short notice, not because the intrinsic geographic benefits of New York, like its status as a port city, have any continuing relevance to what the financial industry does there these days. The same is true for some of New York City's other major industries like television, publishing, and live theater. These industries are prominent simply because they thrive on large local markets and intra-industry interactions, and the New York City metropolitan area is one of the largest local markets in the country with the most established publishing houses and theater scenes. It is helpful to have key parts suppliers for a company near the company that makes the final product, particularly if the parts are physically large, the demand for them fluctuates unpredictably, and it may be necessary to make adjustments to return or modify parts that don't quite fit.

Indeed, industry inertia frequently trumps considerations of geography that would seem to be important. Lots of movies set in the United States are filmed in Prague or Toronto, for example. A majority of publicly held companies in the United States are incorporated in a suburb of Philadelphia called the state of Delaware that doesn't have any notable skyscrapers of its own (the pyramid of Giza built by the ancient Egyptians was 451 feet tall, while the tallest building in the state, the Chase Wilmington Building, is 330 feet tall), lacks an Ivy League college or a prestigious law school, is the only state in the United States without commercial air service, and closes its bars at 1 a.m. The state doesn't even have a single major league professional sports team of its own.

Even industries you might think of as highly location dependent, like tourism, aren't quite as bound to a particular place as you might think. Las Vegas could have been built anywhere within a moderate drive from a major population center. Disneyland and Disney World are likewise not to tightly tied to the world beyond their walls, a fact evidenced by the fact that new ones have sprung up across the world.

If a Nor'easter did to New York City what Hurricane Katrina did to New Orleans, with a similar amount of lead time to allow most people to evacuate, and the Mayor of New York City convinced everyone to move to Fargo at some critical moment, the city that never sleeps could be rebuilt in the Great Plains and continue on a more or less business as usual basis. Something is lost in translation at first, as we observe in cases where national capitals are relocated to completely planned cities like Canberra, Australia and Brasilia, Brazil. Washington D.C. was established on that kind of basis as well, but has aged enough into a character of its own that we tend to forget that fact.

The disconnect between economic activity and location is relatively new. In the 1920s, for example, close proximity to natural resources, consumers, water routes and rail lines was much more important for manufacturing firms. Until World War II, a much larger share of the population lived on farms.

Telecommunications have gotten cheap even more recently. I used to spend a large share of my monthly budget on long distance phone charges so that I could talk with the woman I would later marry when I was in law school, while she was half way across the country going to school somewhere else. These days, there is usually no extra charge for long distance calls relative to local ones. The postal service is coughing up red ink because information can be sent for a near zero marginal cost over the Internet and so people don't send letters nearly as often.

It isn't that location is irrelevant. But, today, what matters is "who lives there?" and "how nice of a place is it to live?" Not, "what is there?"

READ MORE - The Economics of Place