I bring this subject up because of the recent activities in Congress with legislation to improve fuel economy standards for the auto industry. On the surface, this would seem to be a good idea, but what is the reality of conservation?

An English economist from the 19th century named William Jevons theorized that as technology improved efficiency of resource use, that the actual consumption of the resource may actually increase. Known as Jevons Paradox, he applied this to the primary fuel source of the time, which was coal.

Applying Jevons Paradox to the world of today, it is not hard to see the likely outcome. Pretend that a consumer purchases a vehicle that gets twice the gas mileage of the previously owned vehicle. If the consumer drives exactly the same amount of distance as before, that consumer would have only half the fuel expenses. This is obviously a boon to that individual consumer because of the money saved.

Now that this consumer has additional money burning a hole in the pocket, what to do with it? Pretending once again, that consumer takes the savings from the previous few months and purchases a new computer. Petroleum is used in the manufacturing of the computer including the plastics and semiconductors along with the fuel required to transport the product. Once that consumer has the computer in the home, the device becomes tied into the electricity grid for several years.

Pretend that the consumer has figured this out and decides to put the money away in a bank. Did this actually help? No, it does not help. For every dollar that a bank has on deposit, it loans $4-$12 to customers. These loans are used for various energy consuming activities such as a consumer purchasing a new car or a business starting up or expanding. Putting the money into other financial vehicles nets the same result.

While conservation is a winner from the individual consumer's standpoint, it may have the opposite intended effect in regards to actual energy consumption because it is next to impossible to spend money without consuming additional energy.