Prof. James Hamilton of University of California recently wrote a post called Thresholds in the economic effects of oil prices. In it, he concludes

As U.S. retail gasoline prices once again near $4.00 a gallon, does this pose a threat to the economy and President Obama’s prospects for re-election? My answer is no.

EDIT - I originally wrote this post thinking that Prof. Hamilton was looking at a broader question: Can an economy learn to live with increasingly high oil prices? After looking again at his article again, I realize that he is talking about a narrow question: Using the figures he was looking at (average gasoline prices across all grades), prices were for the week of Sept. 17 near $4 a gallon, as they had been several times in the past, as they bounced up and down.

In that context, what he says is far closer to right than what my analysis of the broader question of whether an economy can learn to live with increasingly high oil prices, below, would suggest. There is a difference, because gasoline prices are not too closely tied to oil prices in short term fluctuations, and because the issue is likely to be as much one of consumer sentiment as anything else, as long as the issue is simply one of gasoline prices in a not-too-wide range. But I think there are some longer-term, more general issues we should be concerned about.

This is a guest post by Mike "Mish" Shedlock, who is an investment advisor representative with Sitka Pacific Capital Management. Mish blogs at Mish's Global Economic Trend Analysis, where this post first appeared.

A major part of the United States' misguided policy on ethanol usage came to an end as the $6 billion-a-year ethanol subsidy dies

America's corn farmers have been benefiting from annual federal subsidies of around $6 billion in recent years, all in the name of ethanol used as an additive for the nation's vehicles.

That ends on Jan. 1, when the companies making ethanol will lose a tax credit of 46 cents per gallon, and even the ethanol industry is OK with it -- thanks in part to high oil prices that make ethanol competitive.

Subsidized since 1979 as a homegrown fuel cleaner than gasoline, corn ethanol had plenty of opponents, environmentalists among them.

Environmentalists question the cleaner energy premise -- adding factors like tractor diesel emissions and fertilizer runoff make it dirtier, they say.

"Corn ethanol is extremely dirty," Michal Rosenoer, biofuels manager for Friends of the Earth, said in heralding the tax credit's demise. "It leads to more climate pollution than conventional gasoline, and it causes deforestation as well as agricultural runoff that pollutes our water."

Opponents also see corn ethanol, which now takes a larger share of the U.S. corn crop than cattle, hogs and poultry, as a factor in driving food prices higher.

"The end of this giant subsidy for dirty corn ethanol is a win for taxpayers, the environment and people struggling to put food on their tables," Rosenoer added.

But there's a nearer-term battle brewing over corn-based ethanol. A 2005 law requires that 7.5 billion gallons of renewable fuel be produced by 2012 -- 6.25 billion gallons were produced in 2011. A 2007 revision gradually increases that to 36 billion gallons by 2022.

This is a guest post by Hugh Sharman that originally appeared on Dimwatt. Hugh is a well known UK energy analyst, his short biography is included at the end of this post. Long term readers of TheOilDrum may recall the second guest post I published here that was based around one of Hugh's articles.

Dr John Constable, the Director of Research at the Renewable Energy Foundation has written an important new article, entitled "Renewables won't keep the lights on", for the on-line Standpoint Magazine.

His article begins with the statement that “In private, the best-informed analysts now agree that Britain's environmental policies have put the country on track to have the world's most expensive electricity.” This is true and tragic. Whatever happened to the “honest” analyst? That their well-informed views are largely correct but held privately disgraces not just the "best-informed analysts" but the whole financial industry! These are the same analysts (or at least from the same self-regarding stables) who stayed mum and therefore well rewarded, while their peers exponentially diced and sliced debts, leading up to the Great Crash of 2008.

The title is self-evidently true, of course, as anyone who is following the electricity generation sector this third-in-a-row, 1960s-style, cold winter (2010 - 2011) can confirm. Typically, wind power output during the periods of greatest (and record) demand has been a piffling few percent at most of their highly expensive, nameplate capacity - and a negligible fraction of national requirements.

The price of energy has a very strong influence on the energy choices governments and individuals make. I sometimes hear people ask "Why are we still building coal-fired power plants?" or "Why don't we replace more petroleum with biomass?" One reason is that biomass is generally more difficult to use from a logistical point of view. Another is that there just isn't enough biomass to meet present energy demands. But a major factor comes down to price.

The price and convenience of energy sources are ultimately the keys to customer acceptance. Homes can be heated with wood, heating oil, natural gas, or electricity. Automobiles can be fueled with gasoline, ethanol, natural gas, diesel, electricity, and a wide variety of more unconventional fuels. If consumers have a choice and the supply is convenient, they will tend toward the cheapest energy source they can get.

(a note: Robert has been asked to contribute articles to Forbes blog, and this article is the first of his posts there.)