In the absence of oxygen, there would have been lots of different ways complex organic compounds could have been created - hot magma, ultraviolet light, lightning, asteroid impacts - and since there was nothing to "eat" those compounds, they accumulated to a sufficient (but still very low) concentration so that the ones with the chemical propensity to replicate could and did. Certain kinds of these, such as nucleic acids,and phospholipids replicated faster and were more successful at it than other forms. This process built on itself until the faster replicators crowded out other compounds that didn't replicate or replicated slowly or more imperfectly.
Eventually, groups of these successfully replicating compounds formed, by chance of course, although some including me, say it was inevitable given the amount of time involved. These groups were even more successful at replicating than the individual compounds. Continue this and pretty soon, after a billion years or so, you have life as we recognize it.
As for your second question, new life can't form now because the existing life is so efficient at using any source of energy, such as complex organic chemicals, that there isn't a sufficient concentration of these organics.
The biggest problem I have with the ID people is that they think too small, concentrating on feathers and eyes, when the the real wonder is in how everything (earth's location, the sun's size, the elemental composition of the earth, the laws of physics, etc) fit together so perfectly as to result in me answering your questions. That's the design part.
Well said (actually, not the above back quote, but what followed).
The biggest problem I have with the ID people is that they think too small
Not true of all ID people (dare I say most ID people? I dont know that I can support that proposition, so I guess I wont say it). The ID people who think too small, do so because their focus is too restricted (or so it seems to me). Their objectives are confined because their objectives are not grounded in faith, but in political calculation (i.e. the DI). Most people of Christian faith do not think of themselves as ID people. ID is simply but of a small part of the totality of their religion.
The idea has existed long before the term. In a letter to John Adams, dated April 11, 1823, by Thomas Jefferson we see a much better statement of the theme than we hear today:
The argument which they [the denier of Christian faith] rest on as triumphant and unanswerable is, that in every hypothesis of cosmogony, you must admit an eternal pre-existence of something; and according to the rule of sound philosophy, you are never to employ two principles to solve a difficulty when one will suffice. They say then, that it is more simple to believe at once in the eternal pre-existence of the world, as it is now going on, and may forever go on by the principle of reproduction which we see and witness, than to believe in the eternal pre-existence of an ulterior cause, or Creator of the world, a Being whom we see not and know not, of whose form, substance and mode, or place of existence, or of action, no sense informs us, no power of the mind enables us to delineate or comprehend.
[By 141 years Jefferson anticipates the detection of the cosmic microwave background radiation signaling that the universe indeed had a beginning.]
He continues: On the contrary, I hold, (without appeal to revelation) that when we take a view of the universe, in its parts, general or particular, it is impossible for the human mind not to perceive and feel a conviction of design, consummate skill, and indefinite power in every atom of its composition. . The movements of the heavenly bodies, so exactly held in their course by the balance of centrifugal and centripetal forces; the structure of our earth itself, with its distribution of lands, waters and atmosphere; animal and vegetable bodies, examined in all their minutest particles; insects, mere atoms of life, yet as perfectly organized as man or mammoth; the mineral substances, their generation and uses; it is impossible, I say, for the human mind not to believe, that there is in all this, design, cause and effect, up to an ultimate cause, a Fabricator of all things from matter and motion, their Preserver and Regulator while permitted to exist in their present forms, and their regeneration into new and other forms.
In diary entries, some sixty six years earlier Adams recorded very much the same thoughts as Jefferson (see diary entries by John Adams of Sunday, May 22[23], 1757, pg 16, Monday, May 23[24], 1757, pg 16, Fryday, May 27[28], 1757, pg 17).
Even today we see the belief of Creationism and a design concept incorporated in a much larger framework Christian faith as exemplified in the following remarks of President Bush:
We believe that liberty is the design of nature. We believe that liberty is the direction of history. We believe that human fulfillment and excellence come in the responsible exercise of liberty. And we believe that freedom, the freedom we prize, is not for us alone. It is the right and the capacity of all mankind.
. . . . . George W Bush, remarks delivered at the National Endowment of Democracy, Thursday, November 6, 2003