Thursday, April 03, 2014

"Those who cannot remember the past ..."

Natural gas is much in the news because it is the weapon of choice by Russia as well as (perhaps) the West in the new Cold War. V. Putin uses threats to shut the pipelines that connect Russian supplies with much of Europe.

But the West is not yet sure whether to respond -- via signals and/or actions -- that they plan to expand world supplies, push down the world price, and give Russian elites something to think about.

In any event, labor and capital are ever more mobile. Seasteading, as suggested by Patri Friedman, is the logical extension. If taxes and other impediments on the land become onerous enough, move operations to the high seas -- just beyond any national jurisdiction. The extra costs have been labeled the "sea tax" and they can be compared with the costs of operations at conventional sites.  Today's WSJ notes that a tipping point may have been reached "Asian Gas Demand Spawns Floating Superfactories ... Energy Companies Aim to Cut Costs With LNG Production Plants at Sea."

The original Cold War was won when the economic weakness of the side that denied economic freedom realized that the world was accelerating away from the East bloc. That realization may soon dawn on Putin and the Russian elites. "Those who cannot remember the past ..."