One More Puzzle: Oil Science & Public Policy Stephen M. Maurer Jan Lecture 2

Introduction Science Interacts With Society… Courts Use Science Decision-makers Use Science Society Invests in Science Not All Science is Public! Economics & Science

Oil

A Simple Exploration Model: Every Year, The Industry Sends Out 10,000 Workers to Look for Oil Time Discovery Rate (BBLs)

Oil: The Hubbert Curve US Peak – 1980 World Peak

Oil Winston Churchill (1911) US Navy (1911) Teapot Dome/Strategic Petroleum Reserve M. King Hubbert (1956) Paul Ehrlich and The Club of Rome (1971) Current Estimates 10 years or 50? 1350 billion barrels (1969) vs billion (2000) Predictions

Oil: The Hubbert Curve Why Geologists Believe the Hubbert Curve Example: US Exploration Why Economists Don’t. Examples: Nazi Germany, Saudi Exploration, Capital Markets Who’s Right?

Oil: Implications Implications for Politics “Finding a billion barrels here and a billion barrels there doesn’t change the nature of the argument.” – World Resources Institute Implications for Policy “It doesn’t matter when the oil runs out, it’s going to run out eventually.” – Steven Chu

Pre-HistoryWas There Sufficient Innovation? Ancient WorldIrrigation Economies Pyramids as Industrial Research Patrons and Prizes Archimedes, Consultant Dyonysius The Library of Alexandria Middle AgesPatrons, Courts, Prizes Knowledge & Commerce Early Modern Frederick the Great, George III Europe

19 th CenturyIn-house expertise, agriculture, resource mapping Foundations & The Birth of Big Science World War IAviation 1930sBig Science Between the Wars World War IINuclear Weapons, Radar, etc., etc. Penicillin.

1946Vannevar Bush, Science, The Endless Frontier Post-WarHarley Kilgore & NSF Legislation Physics (ONR) Health & General Science

KoreaNuclear Weapons, Electronics Sputnik & The Space RaceAerospace, General Science Vietnam Energy CrisisEnergy & Fusion Research CompetitivenessComputing, Engineering, Electronics End of Cold War Bush AdministrationHealth

Current Budget = Fossilized History?

National Defense54% Health23% Space & Aeronautics 9% General Science & Basic Research 6% Pollution Control 2% Conservation, Resource Mapping & Weather 2% Agriculture 2% Energy 1% Other 1%

DOE Expenditures ($2.3 billion) Nuclear and high energy physics37% Fusion and energy research 36% Advanced scientific computing 5% Human genome research 4% Other types of biology and environmental research 15% Other 3%

NSF Expenditures ($2.7 billion) Mathematics and physical sciences 28% Earth sciences 18% Biology 15% Engineering 14% Computer science 14% Other11%

NIH Budget$27.9 billion(2004) $13.6 billion (1998)

Lawrence Berkeley Lab Stockpile Stewardship Computing Biology & Genomics Terrorism

Who pays for R&D? Top: Government ; Bottom: Industry

Top: US Funding to industry. Bottom: US Funding to universities