I believe your train of thought about past solutions to oil shortages is correct Coach. There is no easy answer this time. Bush and his government came up with the ethanol solution in an attempt to avoid the inevitable and to appease voters. The result has been inflated food prices which hit the poor countries much harder than North American consumers. High gasoline prices are already starting to change consumer behaviours about driving and buying cars. There is still oil to be found but it is much more costly and technically difficult to find and produce (the recent Brazil discovery is a good example). I still think coal gasification will become acceptable in the future - it is technically feasible but expensive when done to meet environmental demands. It is probably economic at these high energy price levels. Shale gas has been around for decades but it is also relatively expensive.

Time after time we see "crises" like the oil price arise and politicians reacting by trying to legislate their way through them to avoid political unpopularity. And inevitably the law of unintended consequences intervenes. When I started in the oil business oil was $2 per barrel and gas was 10 cents per mcf. Most gas wells had to be shut in because there were no pipelines to the big markets. Imagine that! I am an unrepentant capitalist rightwinger who has lived his life wishing governments would get out of my way and out of my wallet. Maybe some day - hoping to live that long.