Daily Score Blog

In a recent post, I mentioned that the U.S. economy is highly energy-intensive. That is, the energy used to produce $1 of wealth in America can produce $2 in Germany and nearly $3 in Japan. So, all else being equal, high oil prices take a heavier toll on the U.S. economy than in more energy-efficient countries, simply because we need more energy to do business. (By the way, oil prices just bumped up past $50 a barrel.)

But there's yet another reason why high oil prices hit harder in the States than elsewhere. On the global market, oil is priced in U.S. dollars. Obviously then, Americans feel every oscillation in prices because crude is denominated in the same currency as our paychecks. That's not necessarily true in other countries.

This morning, Vancouver, BC will break its record for the sunniest February ever recorded there. And there are still nearly four days left, most of which are predicted to be sunny.

Meanwhile, next door in Washington, the Seattle Times reports on the signs of spring, like hikers at Hurricane Ridge, emerging mountain wildflowers, blooming cherries and dogwoods, and Seattle temperatures setting records at 64 degrees Fahrenheit.

Gas prices have edged up over the past month, passing $2 a gallon in Seattle earlier this week as an east-coast cold snap pushed up crude oil prices.

But no matter how high the market price goes, gas (and driving in general) is still too cheap.

As the P-I (among others) reported last week, the Washington state budget is in trouble.  And one of the biggest problems for the state is the rapid rise in medical costs, many of which are borne by the state.

By now, it should be no surprise that health care costs are rising faster than inflation; but it may be a surprise how dramatic the change has been over time. 

Since 1980, inflation has grown at about 3.5 percent per year in the Seattle and Portland areas.  But medical expenses have grown by nearly 6 percent per year.  Year to year, that's not a huge difference; but over time it really adds up, as the graph below shows.  On average, things are about 2.5 times as expensive now as they were in 1980; medical costs, however, are about 4 times what they were 25 years ago.

The big question in my mind is:  why?  Why, exactly, is the cost of medical care rising so much faster than everything else?

There was a lot of media coverage of yesterday's release of the 2005 Cascadia Scorecard (for example, this and this). What most interested me was that the media couldn't find anyone who would directly contradict our finding that the Northwest's energy system is virtually impossible to defend against determined attackers. We knew our analysis was alarming; we were braced to defend it vigorously. But there was no counterpunch.

The closest that anyone came to contradicting us were the quotes in this Associated Press story (here in the Salem Statesman-Journal). But the statements in this article do not actually contradict our analysis, they simply offer assurances to the public that the situation has improved since 2001. And that electric authorities are pretty good at responding quickly to emergencies. But that's not saying much.

Now, the question is, will awareness of the energy system's vulnerability to sabotage actually sink in and help to motivate more-rapid progress toward a resilient, clean, and prosperous energy future? One encouraging sign is this morning's Seattle Post-Intelligencer's editorial.