While its good news, the long term doesn't bode well unless we can get oil prices down. And I know this Balsphamy is really going to rankle ACE readers, but the Liberals are actually right about something for a change: we need a gasoline tax! And we need an energy policy that looks out beyond the draining of what few tiny reserves we have left. So have at me!

unemployment could fall from its current 5.4 percent to as low as 5 percent, a nearly 10 percentage point decline.

Oh, and to 72Virgins - We have lots of gas taxes already. And we don't need a frickin' Eurozone 300% increase on the price of gas. Everything in Europe is close together. Everything in the US is far apart. We have plenty of oil for a while. Don't let OPEC propaganda fool you.

Pleae correct me if I am wrong; I have heard over and over that the problem is not that we are even remotely 'running out' of oil; the problem is the world's capacity to produce and refine enough of it at any one time.

Yup, expanding demand + static supply (thanks to OPEC and the ANWR enviro-nazis) = Rising prices. Saudi, Iraq, the North Sea, the North Pole all have huge oil reserves. They are getting more expensive to drill, but the primary problem is that China and India have greatly expanded demands for oil.

lawraw: you're right, and Brett's right about demand, and Russia, which used to cooperate on output and prices is getting uncooperative. We still need a rational energy policy that discourages gasoline consumption, replaces some of the traffic that currently wastes gas, pollutes, and kills and injures thousands, with mass transit and considers alternatives like nuclear, solar, coal gassification and liquification, or anything else that'll work. And thanks for the link!

72Virgins, that's great and all, and I'm glad you're so passionate about this "oil" thingy (seriously - I can tell you are on top of this), but mass transit? Please. I live in the 'burbs, take it to work in the big city every day, and here's the thing - it's just not freakin' consistently reliable. Up here in Boston, which one would sort of assume would be prepared for winter contingencies, it gets especially bad in winter. Throw in a little snow, or even worse, very cold weather, and the commuter rail and T goes to the crapper. The cost of parking is the only thing that keep me from driving in most days, even knowing how crappy, pollutey, killy and injurey driving can be. On snow days, when driving can be even crappier, pollutier, killier, and injurier than usual, I don't even let that stop me.

72virgins guy: you have to live in one of the very few cities in the US -- New York or San Francisco and maybe a couple of others I am not sure about -- where mass transit is not an absolute pain the the ass life-and-time-suck. Listen: I lived for most of my life in Miami Florida, which is no slouch when it comes to big-citiness, and now I live in Winter Park, which is part of the Greater Orlando/Central Florida area and one of the fastest-growing communities in the country. And for much of that time I took the bus (supplemented by Metrorail -- a glorified eleveated bus system-- in Miami) to get to school and work. Let me tell you one thing: it sucked. Here's why:

Living near my job in Miami was not an option -- on one side of my place of employment was a crack neighborhood and on the other side was a multi-million-dollar walled community on Biscayne Bay. My only choices were living on Miami Beach, which I refused to do for a number of reasons (one compelling reason: the Beach is on offshore islands connected to the mainland by a few bridges, which is oh-so-much fun when hurricane-evacuation-time comes around), or live in the west part of Miami-Dade county. I did the latter. It took me, via mass transit, up to three hours each way to get to my job. Yay fun.

And then Orlando. I had my car repoed so I ended up needing to take three buses to and from work every day as I lived on the other side of town. Due to the sprawling nature of the Orlando area this was another three-to-four hours I had drained from my life each day. This time I am am lucky enough to work in a decent neighborhood, and I was able to move a short walk away. I still don't have a car, though, so if my friends aren't available (strangely enough they have their own lives) and I am out of change or just not inclined to take three hour trips I don't get to go anywhere. And I don't get to go anywhere at all after 9:30pm, which is when my local bus route shuts down for the night.

But my point basically is, don't tell people that "mass transit" is the anwer when hardly any city in the country is built like the cozy, walkable medieval towns of Europe. I tell you this as someone who has been to Europe and made good use of the trains, trams, and buses.

1.)pollution caused by individual auto use
-a clean environment is a luxury we pay for.

2.) fuel 'waste'
-I'll be the judge of what constitutes reasonable consumption of something I pay for, thank you very much.

3.) Danger
-Relative to what other activities? Are we going to start looking for 'alternatives' to crossing the street, or teasing grizzly bears? For crying out loud man.
People get stabbed on buses but we don't blame mass transit for it. Come to think of it, maybe we should!

Alternative energy will be explored seriously as a commodity the very instant it becomes an economic alternative, and nothing in the world will change that free market fact.

"Is my math bad, or does 5.4-5 = .4%?"

Bret,

.4 is 8% of 5.4. Thus, if the unemployment rate drops from 5.4% to 5%, 8% of those who *were* unemployed will no longer be.

"But really, who talks about percentages of a percentage?"

Mathemeticians.

From your mouth to G-d's ear, Mr. No-Name. Nuclear energy is already hugely cost-effective and I don't know of a single new facility even on the drawing board.

We could only wish that economics were the controlling authority here, but it just ain't so.

That said, as far as fossil fuels I agree that we won't find an alternative until we absolutely have to. Then we will and life will go on.

You nailed it when you said alternative energy has to be an econimic alternative. Unfortunately that is the only way our Gov't will move in that direction. Oil produces too much money for too many people. Unfortunately we are destroying the air and blah blah blah

There is plenty of oil left in the NP, or ME or AK to last our generation and the next and next after that. But there is a limit. Its a finite source. Alternatives will hopefully be developed before they HAVE to be developed.

I come from the Long Island burbs, lived in NYC for 4 years, have traveled through Europe and taken their superb mass transit and now live in the only city in the country that is so backward that it still insists on road building on a titantic scale instead of Light Rail: Houston. Governor Rick Perry recently admitted something every major city in this country has long known about, just soon as the road widening is completed, it is time to begin widening again. This city is the epitome of road building gone wild! And after spending billions upon billions on road construction for the last 8 years, and even more for the next 12 years, they are finally talking of Light Rail after they've wasted all that time and money. Light Rail and train can solve the transportation problems of this country despite distances, the same red herring was raised here in Texas and used to defeat the same Light Rail they're now beginning to admit will be necessary, i.e., after they've built up a gargantuan monstrosity of roads that made the problem worse and drained all our wallets for 20 years!

Without question we need to reduce our dependency on fossil fuels, but ultimately mass transit is not the answer. Let's face it - we love our cars and we're not giving them up. And even if we wanted to I doubt that many of us could - I take mass transit but only AFTER I've dropped off kids at two different schools and driven to the train station. But we'll take changes to those cars...such as bio-diesel, electric or hydrogen. Personally, I'd love to convert my house to solar, and hope some day to realize that dream.

But getting back to the OP...funny, I don't think I've seen anything about strong job growth in the MSM...

You wanna worry about air pollution? Worry about volcanoes. One eruption of Mt. St. Helens or Mt. Pinatubo produced more nasty 'greenhouse' gases and other air pollutants than all human activity since...EVER. That includes all forms of combustion and probably cow farts too.

Damned F$%#@@# volcanoes. Hmmph. They're destroying the pristine clean untouched beauty of our Earth, I tells ya!

Now if you'll excuse me, I have to get back to shooting the flying squirrels which are raiding the birdfeeders at night.

Tasty lil' sumbitches.

Gee, I wonder if Krugman is going write about the good news.

Well naturally rdbrewer.

I think the title of his essay will be;

"Good news is actually bad news"or
"This is not a trend"

Elisa: We shall always have cars and roads but in many places we cannot continue to use them exclusively as our only means of travel. Even if we continue to try to keep up with the growing demand for new and wider roads, we shall reach a point of saturation at which it becomes less and less effective to build roads. At that point traffic delays become longer and longer, manuvering and just getting around become harder and harder, roads become more and more dangerous to drive on and require more and more maintenance exacerbating all of the above. We have reached that point already in many cities, and many have made the decision to turn to the only viable alternative: Light Rail and train.