Energy Products: Return on Investment is Already Too Low

My major point when I gave my talk at the Fifth Biophysical Economics Conference at the University of Vermont was that our economy’s overall energy return on investment is already too low to maintain the economic system we are accustomed to. That is why the US economy, and the economies of other developed nations, are showing signs of heading toward financial collapse. Both a PDF of my presentation and a podcast of the talk are available on Our Finite World, on a new page called Presentations/Podcasts.

My analysis is with respect to the feasibility of keeping our current economic system operating. It seems to me that the problems we are experiencing today–governments with inadequate funding, low economic growth, a financial system that cannot operate with “normal” interest rates, and stagnant to falling wages–are precisely the kinds of effects we might expect, if energy sources are providing an inadequate energy return for today’s economy.

Commenters frequently remark that such-and-such an energy source has an Energy Return on Energy Invested (EROI) ratio of greater than 5:1, so must be a helpful addition to our current energy supply. My finding that the overall energy return is already too low seems to run counter to this belief. In this post, I will try to explain why this difference occurs. Part of the difference is that I am looking at what our current economy requires, not some theoretical low-level economy. Also, I don’t think that it is really feasible to create a new economic system, based on lower EROI resources, because today’s renewables are fossil-fuel based, and initially tend to add to fossil fuel use.

Adequate Return for All Elements Required for Energy Investment

In order to extract oil or create biofuels, or to make any other type of energy investment, at least four distinct elements described in Figure 1: (1) adequate payback on energy invested,  (2) sufficient wages for humans, (3) sufficient credit availability and (4) sufficient funds for government services. If any of these is lacking, the whole system has a tendency to seize up.

Figure 1. One sheet from Biophysical Economics Conference Presentation

Figure 1. One sheet from Biophysical Economics Conference Presentation

EROI analyses tend to look primarily at the first item on the list, comparing “energy available to society” as the result of a given process to “energy required for extraction” (all in units of energy). While this comparison can be helpful for some purposes, it seems to me that we should also be looking at whether the dollars collected at the end-product level are sufficient to provide an adequate financial return to meet the financial needs of all four areas simultaneously.

My list of the four distinct elements necessary to enable energy extraction and to keep the economy functioning is really an abbreviated list. Clearly one needs other items, such as profits for businesses. In a sense, the whole world economy is an energy delivery system. This is why it is important to understand what the system needs to function properly.

What Happens as Oil Prices Rise

When oil prices rise, wages for humans seem to fall, or at least stagnate (Figure 2, below). The comparison shown uses US per capita wages, so takes into account changes in the proportion of people with jobs as well as the level of wages.

Figure 2. High oil prices are associated with depressed wages. Oil price through 2011 from BP’s 2012 Statistical Review of World Energy, updated to 2012 using EIA data and CPI-Urban from BLS. Average wages calculated by dividing Private Industry wages from US BEA Table 2.1 by US population, and bringing to 2012 cost level using CPI-Urban.

Figure 2. High oil prices are associated with depressed wages. Oil price through 2011 from BP’s 2012 Statistical Review of World Energy, updated to 2012 using EIA data and CPI-Urban from BLS. Average wages calculated by dividing Private Industry wages from US BEA Table 2.1 by US population, and bringing to 2012 cost level using CPI-Urban.

In fact, if we analyze Figure 2, we see that virtually all of the rise in US wages came in periods when oil prices were below $30 per barrel, in inflation-adjusted terms. The reason why the drop in wages happens at higher per-barrel levels is related to the drop in corporate profits that can be expected if oil prices rise, and businesses fail to respond. Let me explain this further with Figure 3, below.

Figure 3. Illustration by author of ways oil price rise could squeeze wages. Amounts illustrative, not based on averages.

Figure 3. Illustration by author of ways oil price rise could squeeze wages. Amounts illustrative, not based on averages.

Figure 3 is a bit complicated. What happens initially when oil prices rise, is illustrated in the black box at the left. What happens is that the business’ profits fall, because oil is used as one of the inputs used in manufacturing and transportation. If the cost of oil rises and the sales price of the product remains unchanged, the company’s profits are likely to fall. Additionally, there may be some reduction in demand for the product, because the discretionary income of consumers is reduced because of rising oil prices. Clearly, the business will want to fix its business model, so that it can again make an adequate profit.

There are three ways that a business can bring its profits back to a satisfactory level, illustrated in the last three columns of Figure 3. They are

  • Automation. Human energy is the most expensive type of energy a business can employ, because wages to paid to humans to do a given process (such as putting a label on a jar) are far higher than the cost of an electricity-based process to perform the same procedure. Thus, if a firm can substitute electrical or oil energy for human energy, its cost of production will be lower, and profits can be improved. Of course, workers will be laid off in the process, reducing total wages paid.
  • Outsourcing to a Country with Lower Costs. If part of the production cost can be moved to a country where wage costs are lower, this will reduce the cost of manufacturing the product, and allow the business to offset (partially or fully) the impact of rising oil prices. Of course, this will again lead to less US employment of workers.
  • Make a Smaller Batch. If neither of the above options work, another possibility is to cut back production across the board. Even if oil prices rise, there are still some consumers who can afford the higher prices. If a business can cut back in the size of its operations (for example, close unprofitable branches or fly fewer airplanes), it can cut back on outgo of many types: rent, energy products used, and wages. With reduced output, the company may be able to make an adequate profit by selling only to those who can afford the higher price.

In all three instances, an attempt to fix corporate profits leads to a squeeze on human wages–the highest cost source of energy services that there is. This seems to be Nature’s  attempt way of rebalancing the system, toward lower-cost energy sources.

If we look at the other elements shown in Figure 1, we see that they have been under pressure recently as well. The availability of  credit to fund new energy investment is enabled by profits that are sufficiently high that they can withstand interest charges incurred in the payback of debt. Debt use is also enabled by growth, since if profits will be higher in the future, it makes sense to delay funding until the future. In recent years, central governments have seen a need to put interest rates at artificially low levels, in order to encourage borrowing. To me, this is a sign that the credit portion of the system is also under pressure.

Government’s ability to fund its own needs has been under severe stress as well. Part of the problem comes from the inability of workers to pay adequate taxes, because their wages are lower. Part of the problem comes from a need for governments to pay out more in benefits, such as disability income, unemployment, and food stamps. The part that gets most stressed is the debt portion of government funding. This really represents the intersection of two different areas mentioned in Figure 1: (3) Adequacy of credit availability and (4) Funding for government services.

The constellation of energy problems we are now experiencing seems to me to be precisely what might be expected, if energy return is now, on average, already too low.

The Role of Energy Extraction in this Squeeze

When any energy producer decides to produce energy of a given type (say oil or uranium), the energy producer will look for the resource that can be extracted at lowest cost to the producer.

Figure 4. Resource triangle, with dotted line indicating uncertain financial cut-off.

Figure 4. Resource triangle, with dotted line indicating uncertain financial cut-off.

Initially, production starts where costs are most affordable–not much energy is required for extraction; governments involved do not require too high taxes; and the cost of human labor is not too high. The producer may need debt financing, and this must also be available, at an affordable cost.

For example, easy-to-extract oil located in the US that could be extracted very simply in the early days of extraction (say before 1900), was very inexpensive to extract, and would be near the top of the triangle.  Tight oil from the Bakken and bitumen from Canada would be examples of higher cost types of oil, located lower in the triangle.

As the least expensive energy is extracted, later producers wishing to extract energy must often settle for higher cost extraction. In some cases, technology advancements can help bring costs back down again. In others, such as recent oil extraction, the higher costs are firmly in place. Higher sales prices available in the market place enable production “lower in the triangle.”  The catch is that these higher oil prices lead to stresses in other systems: human employment, government funding, and ability for credit markets to work normally.

What Is Happening on an Overall Basis

Man has used external energy for a very long time, to raise his standard of living. Man started over 1,000,000 years ago with the burning of biomass, to keep himself warm, to cook food, and for use in hunting.  Gradually, man added other sources of energy. All of these sources of energy allowed man to accomplish more in a given day. As a result of these greater accomplishments, man’s standard of living rose–he could have clothes, food which had been cooked, sharper tools, and heat when it was cold.

Over time, man added additional sources of energy, eventually including coal and oil. These additional sources of energy allowed man to leverage his own limited ability to do work, using his own energy.  Goods created using external energy tended to be less expensive than those made with only human energy, allowing prices to drop, and wages to go farther. Food became more available and cheaper, allowing population to rise. Money was also available for public health, allowing more babies to live to maturity.

What happened in the early 2000s was a sharp “bend” in the system.  Instead of goods becoming increasingly inexpensive, they started becoming relatively more expensive relative to the earnings of the common man. For example, the price of metals, used in many kinds of goods started becoming more expensive.

Figure 5. Commodity Metals Price Index from the International Monetary Fund, adjusted by CPI-Urban to 2012 price levels. Commodity Metals include Copper, Aluminum, Iron Ore, Tin, Nickel, Zinc, Lead, and Uranium.

Figure 5. Commodity Metals Price Index from the International Monetary Fund, adjusted by the US CPI-Urban to 2012 price levels. Commodity Metals include Copper, Aluminum, Iron Ore, Tin, Nickel, Zinc, Lead, and Uranium.

There seem to be two reasons for this: (1) In the early 2000s, oil prices started rising (Figure 2, above), and these higher prices started exerting an upward force on the price of goods. At the same time, (2) globalization took off, providing downward pressure on wages. The result was that suddenly, workers found it harder to keep a job, and even when they were working, wages were stagnant.

It seems to me that prior to the early 2000s, part of what buoyed up the system was the large difference between:

A. The cost of extracting a barrel of oil

B. The value of that barrel of oil to society as a whole, in terms of additional human productivity, and hence additional goods and services that barrel of oil could provide.

As oil prices rose, this difference started disappearing, and its benefit to the world economy started going away.  The government became increasingly stressed, trying to provide for the many people without jobs while tax revenue lagged.  Slower economic growth made the debt system increasingly fragile. The economy was gradually transformed from one which provided perpetual growth, to one where citizens were becoming poorer and poorer. This pushed the economy in the direction of collapse. Research documented in the book Secular Cycles by Turchin and Nefedov shows that in past collapses, the inability of governments to collect sufficient taxes from populations that were becoming increasingly poor (due to more population relative to resources) was a primary contributing factor in these collapses. The problems that the US and other developed countries are having in collecting enough taxes to balance their budgets, without continuing to add debt, are documentation that this issue is again a problem today. Greece and Spain are having particular problems in this regard.

A More Complete List of Inputs that Need Adequate Returns

My original list was

  1. Energy counted in EROI calculation–mostly fossil fuels, sometimes biomass used as a fuel
  2. Human labor
  3. Credit system
  4. Cost of government

To this we probably need to add:

  1. Profits for corporations involved in these processes
  2. Rent for land used in the process – this cost would be highest in biofuel operations.
  3. Costs to prevent pollution, and mitigate its effects – not charged currently, except as mandated by law
  4. Compensation for mineral depletion and degradation of soil. Degradation of soil would likely be an issue for biofuels.
  5. Energy not counted in EROI calculations. This is mostly “free energy” such as solar, wind, and wave energy, but can include energy which is of limited quantity, such as biomass energy.

Given the diversity of items in this list, it is not clear that simply keeping EROI above some specified target such as 5:1 is likely to provide enough “margin” to cover the financial return needed to properly fund all of these elements. Also, because the need for government services tends to increase over time as the system gets more stressed, if there is an EROI threshold, it needs to increase over time.

It might also be noted that the amounts paid for government services are surprisingly high for fossil fuels. Barry Rodgers gave some figures regarding “government take” (including lease fees as well as other taxes and fees) in the May 2013 Oil and Gas Journal. According to his figures, the average government take associated with an $80 barrel of US tight oil is $33.29 per barrel. This compares to capital expenditures of $22.60 a barrel, and operating expenditures of $7.50 a barrel. If we are to leave fossil fuels, we would need to get along without the government services funded by these fees, or we would need to find a different source of government funding.

Source of the EROI 5:1 Threshold

To my knowledge, no one has directly proven that a 5:1 threshold is sufficient for an energy source to be helpful to an economy. The study that is often referred to is the 2009 paper, What is the Minimum EROI that a Sustainable Society Must Have? (Free for download), by Charles A. S. Hall, Steven Balogh, and David Murphy. This paper analyzes how much energy needs to provided by oil and coal, if the energy provided by those fuels is to be sufficient to pay not just for the energy used in its own extraction, but also for the energy required for pipeline and truck or train transportation to its destination of use. The conclusion of that paper was that in order to include these energy transportation costs for oil or coal, an EROI of at least 3:1 was needed.

Clearly this figure is not high enough to cover all costs of using the fuels, including the energy costs to build devices that actually use the fuels, such as private passenger cars, electrical power plants and transmission lines, and devices to use electricity, such as refrigerators. The ratio required would probably need to be higher for harder-to-transport fuels, such as natural gas and ethanol. The ratio would also need to include the energy cost of schools, if there are to be engineers to design all of these devices, and factory workers who can read basic instructions. If the cost of government in general were added, the cost would be higher yet. One could theoretically add other systems as well, such as the cost of maintaining the financial system.

The way I understood the 5:1 ratio was that it was more or less a lower bound, below which even looking at an energy product did not make sense. Given the diversity of what is needed to support the current economy, the small increment between 3 and 5 is probably not enough–the minimum ratio probably needs to be much higher. The ratio also seems to need to change for different fuels, with many quite a bit higher.

The Add-On Problem for Fossil Fuel Based Renewables

With renewables made using fossil fuels, such as hydroelectric, wind turbines, solar PV, and ethanol, the only way anyone can calculate EROI factors is as add-ons to our current fossil fuel system. These renewables depend on the fossil fuel system for their initial manufacture, for their maintenance, and for the upkeep of all the systems that allow the economy to function. There is no way that these fuels can power the whole system, based on what we know today, within the next hundred years. Thus, any EROI factor is misleading if viewed as the possibility what might happen if these fuels were to attempt to operate on a stand-alone basis. The system simply wouldn’t work–it would collapse.

A related issue is the front-ended nature of the fossil fuels used in creating most of today’s renewables. People today think of “financing” any new investment, with easy payments over a period of years. The catch (as Tom Murphy pointed out in his BPE talk) is that Nature Doesn’t Do Financing. Nature demands up-front payment in terms of any fossil fuels used. Thus, if we build a huge new hydroelectric dam, such as the Three Gorges Dam in China, the fossil fuels required to make the concrete and to move huge amounts of soil come at the beginning of the project. This is also true if we make a huge number of solar panels. The saving we get are all only theoretical, and will take place only if we are actually able reduce the use of  other fossil fuel energy sources in the future, because of the energy from the PV panels or other new renewable.

In nearly all cases, adding renewables requires increasing fossil fuel use for this reason. We could, in theory, reduce fossil fuel use elsewhere, to try to cover the greater fossil fuel use to add renewables, but this would mean cutting industries and jobs currently using the fuel, something that many find objectionable. Several readers have suggested that we could greatly ramp-up solar PV. Yes, we could, but we would have to greatly ramp up fossil fuel usage (mostly coal in China, if current manufacturing approaches are used) to create these panels. Any future savings would be theoretical, depending on how long we keep the new system operating, and how much fossil fuel energy consumption is actually reduced as a result of the new panels.


At this point, the foregoing analysis suggests that products created using today’s oil and other energy products are not producing an adequate financial return to cover wages, interest expense, and necessary taxes. If EROI plays a major role in determining financial returns, EROI on average is already too low for many developed economies.

It is convenient to think that an economy can keep adding lower and lower EROI resources, but at some point, a “stop” signal starts appearing. I would argue that the issues we are seeing in many sectors of the economy are clear indicators that such a threshold is already being reached. An economy in which the wages of the common worker are buying less and less is an economy in trouble. I talk in another post (Energy and the Economy–Basic Principles and Feedback Loops) about the fact that economic growth seems to be the result of one set of feedbacks. As the price of oil rises and related changes take place, these feedbacks change from economic growth to economic contraction. It is these feedbacks that we are already having problems with.

One can argue that EROI has nothing to do with these issues. But if this is the case, what is the point it analyzing it in the first place? We clearly need to understand when an economy is giving us “stop” signals with respect to increasingly low quality energy inputs. If EROI is not helpful in this regard, perhaps we need to be looking at other indicators.

About Gail Tverberg

My name is Gail Tverberg. I am an actuary interested in finite world issues - oil depletion, natural gas depletion, water shortages, and climate change. Oil limits look very different from what most expect, with high prices leading to recession, and low prices leading to inadequate supply.
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242 Responses to Energy Products: Return on Investment is Already Too Low

  1. xabier says:


    David Korowicz has just posted an excellent, and very polite, riposte to Greer in the comments on the latest essay. It has riled Greer tremendously!

    Korowicz’s observations on the unprecedented fragility of our financial and commercial structures are very well-reasoned, and as he points out, this is completely compatible with Greer’s theory of collapse by stages.

    This is how people who have elaborated a theory get caught up in defending it against all comers, due to vanity: he’s closed his mind on this one. Such a pity.

    There’s an interesting post by a Roumanian reader on that site which describes how economic ‘development’ is reducing the ability of Roumanians to provide their own food, – which kept them going when Communism collapses – as city gardens and allotments get built upon with apartment blocks: loss of resilience, increase of fragility.

    And this is just Korowicz’s point: our complex supply lines and so on are very fast and responsive when fully functioning, but also now super-fragile at a time of increasing stress on the whole system..

    • I looked for Korowicz’s comment, but didn’t find it. What name does he post under?

      • xabier says:


        He posted under ‘David Korowicz.’ ( Actually Greer was guardedly polite to Korowicz, but got tetchy with another poster ‘Dave’ who also cited Korowicz, I got slightly confused myself after running through the comments rapidly. )

        Later, Greer states that the flaw in Korowicz is that he doesn’t give enough consideration to peoples’ ability to bounce back after a Crisis: he cites Germany post -1945 as an example of this – immense destruction, stabilisation and rebirth. Someone did point out that ample energy was made available to Germany, but Greer did not take that up.

        There’s a good healthy argument going on there, but I suspect Greer won’t budge.

        He’s right to remind us of how resilient we are, andthat despoair is our enemy, but this ignores all the interconnectedness and fragility of systems issues we have been discussing, above all in finance.

        • I found the comment–it was on the site Resilience, rather than on his own site “Archdruid Report,” where there are a lot of comments.

          It is very easy and tempting for writers to assume that things will somehow turn out all right; they always have in the past. My impression when I talked to Greer previously was that while he thought catabolic collapse took quite a while, he also thought we also might be quite far along on the process. I will have to admit my reading of Greer’s work has been on and off, though.

          • Christopher Johnson says:

            Gail and Xabier:

            Re Greer, I found a delightful comment on a related article about Spengler that you might enjoy:

            Begin Quote:
            I began down my current path, three years ago, trying to confront Spengler’s powerful metaphysical claim:

            “‘Mankind’, however, has no aim, no idea, no plan, any more than the family of butterflies or orchids.”

            Whatever people might think about Spengler’s attempt at universal history, that single sentence wakes us from our comfortable, oil-fueled dreams of a sci-fi push to the stars which you so expertly summarized back in 2011. It reveals that the sci-fi stories we’ve been telling ourselves are just stories; and as they have already proven impossible, mankind will exhaust the Western story and move on to something else.

            But the course Spengler set for the West was not clear to me then. He predicted a Second Religiousness — but what would happen to all the grand rationalism people are proclaiming these days? He proclaimed that the West could only proceed into an ahistorical state — but how could anyone voluntarily do that, when we moderns obsess so deeply over our impact on the future?

            In the last paragraph of this post, you seem to sneak in the answer I eventually figured out to those questions. I expect you’ll elaborate on that next week, and I am thinking as well of the questions that raises: What is mankind’s next intellectual project, then? Does it begin from a blank slate? Will we be forced to lose the collective knowledge we possess?

            End Quote.

            One thing that is quite telling: the most powerful things he writes are the shortest.

            • I especially agree with the quote:

              “‘Mankind’, however, has no aim, no idea, no plan, any more than the family of butterflies or orchids.”

          • xabier says:


            The comment was definitely on Druid Report, but I imagine much the same content. The comments – nearly 200 now -on his latest post contain a much more interesting discussion than usual, as a few people in addition to Korowicz have questioned some of his basic assumptions, which is unusual (hence the slight irritation which is discernible!)

            He seems to envisage a steady process of decay, – as you say, already long begun – with occasional rough patches in which a region or country takes a marked downward step in wealth and level of technology and some considerable falls in population, leading to a very different picture in c 2070. Well, one can’t quarrel with that as that time frame is impossible for anyone to predict in anything except the vaguest terms. He gives a time-frame of several centuries for the whole process, alluding to Rome, but without an real logical foundation. Well, it sounds,more comforting so why not?

            His emphasis on human resilience and will power is valuable, but this does seem to give insufficient weight to the fact that our very complex systems in the advanced economies can themselves be a source of vulnerability once they have been compromised – by destruction in war, by resource shortages, extreme weather events, and so on.

            He also fails to address the Tainter thesis relating to synchronised global collapse as a novel possibility in terms of the historical record.

            Even in 1945 -55, it was a damn sight easier to rebuild a shattered advanced country than it would be in 2020. He cites the Russian bounce-back, as well as that of post-war Germany, as a classic paradigm for recovery from a serious collapse, but the problems with that argument are too obvious to reiterate here, we all know them.

            I do agree with him that Western Europe is very vulnerable: one can feel it almost in the air these days, even if one didn’t have all the statistics. Britain, as he says is in a particularly weak position in respect of energy, trade, decay of institutions and civil society, and over-population (with attendant racial and religious antagonisms.)

  2. Vineyard says:

    Well, Kim Stanley Robinson often called capitalism “late feudalism” and often advocated alternatives in his book.

    One example was the Bask Mondragon Corporation.

    As for Tood, he might sound pessimistic, but he isn’t. Besides the current problem we currently have, we still have postive developments, like a fully literated world by 2030. This is something that even Peak Oil can’t stopp.

    But he is a big crtiic of the current system of Free Trade and often quotes the economic historian Paul Bairoch.

    For Todd, not economics of Keynes or Hayek are a rolemodel, but of the 19th century economist Friedrich List.

    • xabier says:


      20% of school-leavers in Spain and Britain are functionally illiterate, so no fully literate world by 2030! Shocking figure isn’t it, given the huge cost of national education systems?

      Mondragon are very interesting, but we shall see how their experiment survives the pressures of today: one of their firms has suffered a 40% loss in sales, due to the collapse of the Spanish domestic economy.

      They also employ a lot of people outside Spain and outside their co-operative structure.

      The Mondragon promise is basically that you will never get sacked, and if there are problems you will be found a place at another firm owned by the co-operative.

      It’s all part of the common Spanish (indeed European) fantasy that once you have a job, you should have it for life, and a fat pension at the end: just plain unrealistic.

      The pension issue in Spain will be very big indeed, as the population ages very rapidly. A lot of expectations will be disappointed, I fear.

    • Christopher Johnson says:

      Thanks Vineyard. Interesting articles about Bairoch and List. I enjoyed a biography about Alexander Hamilton a few years ago but had no idea he was influential among European thinkers — at least List appreciated him.

  3. Accounting for Indirect Energy Costs: A Possible Misunderstanding

    Hello Gail,

    Certainly, the ERoEI for the principal energy technologies are too low to support an American-type economy. Certainly, this accounts for pressure on the financial system that manifests itself in other monetary difficulties, to wit:


    1. Energy counted in EROI calculation–mostly fossil fuels, sometimes biomass used as a fuel
    2. Human labor
    3. Credit system
    4. Cost of government


    1. Profits for corporations involved in these processes
    2. Rent for land used in the process – this cost would be highest in biofuel operations.
    3. Costs to prevent pollution, and mitigate its effects – not charged currently, except as mandated by law
    4. Compensation for mineral depletion and degradation of soil. Degradation of soil would likely be an issue for biofuels.
    5. Energy not counted in EROI calculations. This is mostly “free energy” such as solar, wind, and wave energy, but can include energy which is of limited quantity, such as biomass energy.

    Please notice that every monetary burden has an associated energy cost that should be added to the energy invested term of the combined energy technology of an entire economy after the matching problem has been solved using appropriate transformities in the sense of Odum. This was discussed at length many years ago in Chapter 2 of On the Preservation of Species, the open-ended book in which I recorded my principal ideas for many years almost as a stream of consciousness. Changes in the text came in the form of dated notes until I began to think that all of the mistakes had been found. The other day, Dave Kimble noticed that the equation for the expected value of the information in my section on entropy was garbled; therefore, I must review the discussion of the matching problem and the determination of feasibility in that document before entering it in this discussion. Nevertheless, I can address two possible misunderstandings with respect to that methodology at this time.

    Undoubtedly, it will be a painful task to determine and to maintain the proper values for transformities and emergies that are necessary for an in-depth analysis of direct – and, with greater difficulty, indirect – energy costs. Indeed, the values, once attained, must be maintained because energy extraction and conversion and manufacturing processes are constantly changing. Moreover, the matching problem must be solved and resolved to account for the latest information. Clearly, these calculations cannot be made with infinite precision. There will be estimates and approximations. This is true of all scientific computations and does not render them useless. An approximate ERoEI that accounts for the cost of government, the standards of living of the participants, the prevention or reparation of environmental impact, the maintenance of stockpiles of essential materials by moth-balling, recycling, and mindful manufacturing etc. is better than a wild guess as to how high it needs to be.

    Finally  and this is the point alluded to in the title – although one should expect to encounter many levels of indirect costs, that is, indirect costs for indirect costs to the Nth degree, the process must come to an end because the total number of person-hours is finite as is the total energy budget (TEB) of the world. A monotonically increasing Energy Invested term that grows as each indirect energy cost is added to it must finally stop growing because it is bounded above by the TEB. I like to carry out the contribution of human labor by dividing the population into salary cohorts and employing average standard of living data. As is often said, individual human behavior is unpredictable but aggregate human behavior is not.

    My next post will discuss how to solve monetary problems.
    I shall also post this to my blog on blogger, namely,

    • Thanks for your comments. Those are good points you raise. Energy is raised for all parts of the system, and what one really needs is the energy cost of the whole system. If we keep increasing energy used in the extraction part, there is less for the rest. I would argue that we continually increasing energy used in all of the other parts as well, through programs that in many senses are worthwhile, but probably not affordable. These would include Obamacare and the idea of adding carbon capture and storage to coal fired power plants.

      The absolute amount of energy consumed is in some sense bounded by what citizens (either directly or indirectly) can pay for, and that is related to their personal capacity to do work.

      With respect to the paper, “What is the Minimum EROI that a Sustainable Society Must Have?” by Hall, Balogh, and Murphy, I think the problem they were contending with was a common belief that any EROI greater than 1.0 is helpful. This paper seems to have been put together as an antidote to this belief. (I still see comments, very frequently, though that if such and such has an EROI > 1, it must be a good idea.) While the paper is a step in that direction, it really doesn’t get very close to the question of what EROI is needed.

  4. Don Stewart says:

    Dear Gail and Others

    I would like to take off from Xabier’s comment about Monsanto telling the British that they ‘have an obligation to feed the world’ and his observation that Monsanto and Drug Company-style interventions are heavy handed ways to accomplish something that don’t necessarily work any better than ways which use science to work with Nature rather than against it.

    I earlier posited that our daily goal should be to activate our feel-good hormones–but simultaneously minimizing regrets. We can see that Monsanto and the Drug Companies are not terribly effective and are definitely not minimizing the regrets.

    Now I want to turn to the subject of religion. I’ll start with a short story about myself…15 years ago. I was working on some projects in a craft center. I had struck up a casual friendship with a female college student who worked there who did pottery as her personal craft. A famous potter was coming to town to do a weekend workshop. My wife was going to the workshop. I asked the girl if she was going to be able to go. She smiled and said ‘No, I need to go to church’. I was too flabbergasted to say anything. Over the next day or so I tried to sort out how I felt about her statement.

    15 years on and I think I see it all with more maturity. She is simply saying that going to church is reliably going to stimulate those feel good hormones, and the risk of regrets is very low. IF the pottery workshop was Saturday alone, she might consider it, but a full weekend workshop creates a competitive situation and the workshop loses.

    I never discussed her religious beliefs with her in any detail. For the sake of this discussion, let’s suppose she subscribed to a pretty benign religion without any great urge to go out and do damage to other people. I know this girl didn’t have a lot of money. One of the least monetarily expensive ways to reliably activate reward hormones and avoid regrets is through actions we might loosely call ‘religious’…attending communal worship services, meditating, working for Habitat, volunteering in soup kitchens, and so forth.

    Now let’s consider the recent death of George Jones…one of the guys who turned country music into Nashville Music. He was ‘the honky tonk man’. ‘I love to give the girls a whirl to the music of an old juke box, But when my money’s all gone, I’m on the telephone, Saying Hey, Hey Mama, Can your daddy come home?’ And a lot of his real life was spent doing those very things. (Laura Bush and many other celebrities went to his funeral). I would argue that George Jones, whatever you think about his musical innovations, is a very poor role model. He chose a high cost, small return, big regrets path.

    If we look at it from the standpoint of Peak Finance or Peak Oil, those who have chosen a path of frugality and religion (Thomas Merton at Gethsemani, the girl at the craft center) are a lot smarter and better citizens than those such as George Jones who burned the candle at both ends.

    It is a commonplace that poor people embrace religion. If one is poor, the necessity to activate the feel good hormones is just as strong, but the monetary ability to do so is constrained. And certain religious practices offer a reliable way to do what you need to do. If one is Donald Trump, then an abundance of money opens up lots of possibilities…many of which will lead to regrets.

    This brings me back to that odious phrase ‘high-tech’. The ‘highest tech’ should be the solution which most elegantly solves the problem. Which may not involve computers or carbon fibers, or massive oil refineries, or genetic engineering. Richard Feynman noted a long time ago the elegance of Nature’s coding of information with atoms. Is Nature high-tech? I’d say that Nature is frequently elegant and frugal–and that is a very good thing to be in a world of increasingly scarce resources.

    Similarly, I would say that poor people who choose religion are frequently choosing elegant and frugal over complex and expensive. And I’m not trying to defend the dumber things that religious people sometimes get into.

    Don Stewart

    • xabier says:


      The tools I use in my craft haven’t changed for at least 500 years – the earliest illustrations of them. I’ve no doubt they are very much older.

      I’d call that an elegant ‘highest tech needed’ solution.

    • Christopher Johnson says:

      Don, I have one simple question for you regarding your views on religion? Do you totally rule out the possibility that a Supreme Being created the universe and everything in it, and that said Supreme Being routinely communicates with humans (maybe other creatures)? Or do you rate the likelihood of those things as being so remote that you don’t want to even consider them?

      Cheers, Chris

      • Don Stewart says:

        I don’t spend a lot of time worrying about such questions. My day to day concerns are mostly with what the Big Bang and Evolution have handed me. Whether some Power is behind the Big Bang and Evolution, I really don’t know and have no opinion worth stating.

        Don Stewart

        • Christopher Johnson says:

          Fair enough, sir. I was curious after your interesting post. There’s quite a lot to think about already, and I’m certainly one would encourage your efforts to understand our world and what makes it tick. Please don’t slow down!

          Cheers, Chris

          • xabier says:


            (Apologies Gail, this is a bit off OFW territory!)

            A cousin of mine ended up as a Monsignor in Palm Beach having been dedicated to Christ in the womb by his parents (along with all seven other siblings!): I pity those poor exiled priests you mention, at least he chose his mission……

            I’m afraid the mental shutters just came down in Spain in the 16th c, as a result of imposed religious isolationism and fanaticism, and also the immense pride of Empire: you may perhaps already know my favourite illustration of this mental world , the phrase ‘speak Christian’ (‘hablar cristiano’) actually means ‘speak Spanish’. Outside Spain= only infidels!
            (Until quite recently recently, some peasants would react with incredulity if a Northern foreigner tried to address them in their own tongue – how could it be, a heretic using the language of God’s People?)

            I quite concur in the geographical comment: once over those mountains it a changes (but don’t say that to a Basque or Catalan!) And that vast enemy territory in North Africa closing off below.

    • Viewed from an anthopological perspective, religion (its tabus and rules) is an evolutionary adaption to the availability of ressources (energy == food). Not eating pig makes sense if you live in a place of the world where feeding pigs diminishes the amount of food available for humans.

      So religious rules, in an evolutionary sense, are there because they increase the cultures ability to survive.

      Religion is a problem when itself needs to adapt to changes in the ecosystem the society is living in. In the worst case it can endanger the people in this culture because it stops them from adapting.

      Today, for the survival of our ecosystem and thus our culture, birth control would be of utmost importance. People should use contraceptives as there is no other way to reduce populations in a controlled manner.

      Religios rules, that have developed in times when fertility was important for survival, now are harmfull for humanity. Christian ethics thus became harmful for our culture.

      Also, as Max Weber pointed a hundred years ago, the whole Idea of capitalism is based on protestantic ethics.

      So, religion is a way to adapt to change, but not necessarily a good way. Itself needs the ability to question itself in times of global change.

      It is the achievement of the last great change of our culture we should look at for helping us in the face of collapse, the Enlightenment.

      • Christopher Johnson says:

        To Alien Observer et al:
        Ahh, the Enlightment. Curious how it was used to sum up a quick essay on religion. For in one sense, the Enlightenment did — and does — exactly that: sums up religion, even as it leaves the Prime Mover out. My ‘secular humanist’ friends all hate to admit it, but the only intellectual DNA that could possibly have gestated the Enlightenment, is Western Christianity. There are portions of Buddhism that could provide fodder, but where else in the world have ‘the two great commandments’ become foundational for the society at large?
        Leave ‘religion’ to itself: all religions are human inventions and thereby subject to continual corruption by fallible humans pursuing varied objectives. To which a devout recounts his devotion to the Almighty’s instruction, not to the religion. Which leaves wide open the possibility that all those terribly intellectual secular humanists pursuing their Enlightenment dreams may not even know that they’re doing exactly what the Almighty wants them to do, and all the while spewing bile. T’would make Screwtape wretch.

        Cheers, Chris

        • xabier says:


          The Christian concept of ‘brother in Christ’ certainly transmuted into the Enlightenment concept of ‘brother citizen’, although few on the secular Left would recognise it.

          I think, also, that intelligent Europeans grew utterly sick of the violence that had been fomented by the Reformation, – those awful Wars of Religion in the 16th and 17th centuries, – and that gave a strong impulse to the Enlightenment: a rejection of anything looking like ‘enthusiasm’, ie fanaticism, was very much a characteristic posture, although overt emotionalism came back with a vengeance in the Romantic Period.

          One of the great tragedies was the defeat of the Enlightenment in Spain when Napoleon invaded and then was thrown out: few appreciate how many cultured Spaniards actually wanted to become part of (Enlightened) France to escape the heavy hand of the Catholic Church and Monarchy.

          ( Nor did the Enlightenment entirely triumph later: the ‘restoration of the Inquisition’, and the elimination of ‘heretics, Freemasons and free-thinkers’ was actually one of the war-aims of the soldiers from our part of Spain in the Civil War, incredible as it may seem. Truly the Last Crusade).

          • Christopher Johnson says:

            So well stated, sir. At the risk of criticism for ‘geographical determinism’, please consider the ‘fencing effect’ of the Pyrenees and the sea, with ‘hostiles’ to the south. Could there be any other reason that Spain remained so isolated until the demise of its last demagogue?

            A bit of personal history: the small Catholic high school I attended in Southern California employed 6 Piarist fathers who had been ejected from Cuba. Wow, what a volatile mix: smartaleck surfer boys and exiled Spaniards who didn’t understand why they were inadequately respected. Very enlightening! A little social sandpaper.

            On the other hand, should we not also ask a fundamental question: is it possible to ‘convert’ a Third World person directly to ‘Enlightenment’ standards? Or is it necessary to first transition through the Christian stages? Similarly, can a devout Muslim ever be ‘enlightened’? How about a Hindu or Buddhist or Chinese? Is the United Nations sufficiently accommodating to ‘non-Enlightened’ societies?

            Those questions could go on for a few more pages, but I’m sure you get the major point of this rant: the Enlightenment was a singular historical event that changed the world enormously.

            Cheers, Chris

        • @Chris
          Well, I can not argue that. If I am doing “gods” work with trying to promote scientific methods for understanding our world, then great, I hope I do. The problem is, that there is no way of knowing, we can only have faith.
          I also dont think that I spewed bile. If you got that impression from my post you have misinterprated it.

          I also do see Gails point, that religion in the USA is very different from religion in Europe. Religion is a strong bottom up, civil center of communities in the USA, this is somewhat different in europe. Religions in europe (catholicism) are rather top down.

          Religion must never be instrumentalised for impeding the propagation of knowledge.
          This is what I believe in. In my interpretation, this is what enlightenment is about.

          Understanding can only be found by observing nature. If god exists, or your faith tells you so, understanding nature is understanding the works of god. If our mind, that is capable to understand nature, is the work of god, than science can not be ungodly.

          I am as afraid of superstition and religious fanatism, as I am of fascism. For me, they utilise the same faults of the human brain. Intolerance, fueled by superstition and fanatism make discussions about religion or atheism difficult.

          I dont want to promote atheism, but I speak against superstition.

          • Christopher Johnson says:

            To Alien Observer with Respect:
            Well stated, sir. First, allow me to assure you that I found no ‘bile spilling’ in your post; others sometimes do not distinguish between their ‘anti-Christian’ and ‘humanist’ feelings, and easily begin criticizing everything in sight. And there’s much to criticize, since all religions and churches and doctrines and superstitions and fanaticisms are human in nature and therefore subject to error.
            Regarding science, is it not the Almighty’s way of gradually revealing His truth to us? You don’t have to say ‘yes’, but I sometimes wish more ‘religious’ people would rather than just rejecting it wholesale. Then we would be able to avoid the errors you described.
            Cordially, Chris

    • Religion (or rather churches) have a whole lot of benefits, even if you don’t believe more than a small fraction of what is said. There is a wide enough range of beliefs that it is quite possible to avoid ones with huge problems (no contraception, “rapture,” world made in 7 human days, Bible literally true, hell & damnation, discrimination against gays, etc.)

      Women in particular have trouble finding groups where they can meet friends and belong. Jobs tend to be more transient for women than men. Bars are terrible places to hang out, especially for women. A church (especially for women beyond their twenties) gives a place to make friendships, and to find people who like to work on do-good projects of various sorts. People of both sexes often can volunteer for “jobs” that would have more responsibility than they have in the “real world”. Someone needs to interview the new church secretary, to pay the bills each month, and to find a speaker for an upcoming program.

      A person who attends church on a regular basis will often have responsibilities on a Sunday morning. For example, quite a few women participate in bell choirs. Each woman is assigned two or three bells (tuned to particular notes) to play. These groups only play once a month or so, but if a bell choir member is gone, it is not easy for someone to fill in for her. So your friend may very well have had commitments at church that were hard to turn over to someone else.

      A big advantage of a church over other groups is that it is a “gift economy”. Each one contributes, as he or she feels fit. If a church member has a problem later on, there is a reasonable chance that some other member (or the church itself) will be able to give support of some kind. Because there is no financial requirement for membership, a church includes a slightly wider range of financial backgrounds than, say, a country club. But there is still a fair amount of stratification by education. People who want a challenging sermon, given by a well-educated individual, not following the literal words of the Bible, will tend to be well-educated.

  5. Bill says:


    A couple of amusing threads in your comments section today.

    Leading the pack: Organic High Tech.

    A little firm I am associated with back east (MA) just brought a 10″ diameter 1915 Edward Allis D2 reaction hydro turbine ‘back to life’ – using the original test proof documentation (2D hand drawn and measured in 1915, following many actual build, changes, measurements and calculations by the original company that developed it – no CAD flow simulations back then) to build a digital AutoCAD 3D model, which was then 3D printed using wax – the resulting form used as the lost wax mold of a stainless steel casting, which came out of the mold this week. Next week, we’ll begin turning it to final spec on a lathe, drill the shaft mounting hole through the center, balance it, etc.

    It’s a truly remarkable thing – 94% efficient (we know this since the runner is based on the final test proof design. But … cool as this is (to us anyway) I can assure you that, when melting and casting stainless steel, there’s not a lot of “organic”. (We use stainless over bronze for a 50 year minimum life, but a foundry is a foundry.) Takes a lot of juice to run a foundry and a machine shop, and the lives of the staff and so on and so on. (Since we operate a 160kW hydro plant, we’re “green” on a net basis… but if suddenly we started selling 300 a year?) Takes energy to make energy. Even organic high tech green technology.

    Second place: the construct of a ‘new economy’ that will replace the past few that humans have come up with, appearing somehow, as if by magic, on demand, without prior definition – and yes, one that will be adopted by those with the immense wealth they hold in full preservation mode already.

    I really do not look forward to collapse, but see no realistic alternative to it, organic or otherwise. Historically, it’s always the way debts are paid (written off). Collapse is organic.

    • Good luck with remaking the hydro turbine! I agree that building a new economy over the old will be a huge challenge–virtually impossible. And paying off debts will be a bigger one!

    • xabier says:


      Cheering to read of something made to have a life of 50 years, and of people taking the trouble to do so!

      Designed-in, short-term failure is one of the obscenities of our age.

  6. Christopher Johnson says:


    Thanks for your descriptions of Spain. Perhaps you might consider an addendum to Michener’s ‘Iberia’, which is basic and useful. But your perspective is tellin’ skills make it delightful.
    One reason Europe is so important is the continual mixing. We gringos are generally unskilled and even uninterested, I’m sorry to say. I spent a fair amount of time in East Asia and later in the Middle East. Best thing to do is get off the beat path.
    Cheers, Chris

  7. Don Stewart says:

    Dear Gail and Others

    Yesterday, wandering through the bookstore, I picked up a copy of Seeing What Other Don’t: The Remarkable Ways We Gain Insights by Gary Klein. Klein served the US Military for quite while, so some of the stories are about military history. One story involves Napoleon in Toulon in 1793. Napoleon was an obscure officer in the French Republican forces. Toulon had been captured by a powerful Anglo-Spanish force determined to restore the monarchy in France and quash the Republic. The Republican forces could not hope to prevail with a frontal attack. Napoleon conceived the idea of positioning light artillery (which could be dragged up hills by men or animals) in such a way as to command the sea supply lanes of the British and Spaniards. With their supplies cut off, the invaders abandoned Toulon and the Republic survived and Napoleon rose to fame and fortune.

    While I am no military historian, this started me to thinking about other supply crises which led to retreat. For example, once General Sherman cut the last railroad into Atlanta, the Confederate forces simply retreated. There was no large scale ‘battle of Atlanta’. Marshall Zhukov triumphed at Stalingrad by cutting the German supply lines. The Island Hopping war in the Pacific pursued by MacArthur depended on cutting off supplies to those Japanese who had been ‘hopped’. A grim movie about the Japanese army in the Philippines which had been cut off from supplies is told in Fires on the Plain, by Kon Ichikawa in 1959.

    It seems to me that one ‘fast collapse’ scenario likens our Global Industrial Economy to an army which suddenly loses its supply lines. And collapses just as surely as an army which loses its supply lines collapses. In order to think about that scenario, it might be helpful to do a little experiment, or at least a thought experiment. Try to live without buying anything from anyone for one day. If you succeed in that, try it for a week. And if you survive that, try it for a month.

    Probably you won’t make it for one day. Most of us, for example, don’t have any drinking water stored and we don’t have any water purification supplies handy. And we can’t drive to the store to buy some.

    So let’s relax the conditions a little bit. Suppose the condition is that we live for one day entirely on ‘locally produced’ goods and services. I won’t quibble over the definition of ‘local’. But the ‘local’ condition is going to rule out just about everything. The food you buy from a local farmer uses money manufactured in Washington, DC and the farmer depends on a tractor made somewhere far away and powered with oil produced by a global supply chain.

    Perhaps if we relax the conditions more. Let’s consider ourselves to be analogous to Robinson Crusoe. It’s true that we are apparently alone on an island, and will have to become entirely self-sufficient, but in the meantime we have what is on the ship to scavenge. So the local farmer is allowed to continue to use his hand tools which were made far away, but not to buy new supplies of oil products to fuel his tractor. Given a fairly long time line, it is possible that the tractor can be powered by biodiesel produced in the immediate vicinity. Some farms do that now. And, given a long time line and some knowledge, the farmer learns how to grow food without turning the soil or using pesticides or herbicides. All this knowledge is around today. We would just have to turn society rather than the soil.

    Now let’s take a more radical step. The Global Financial System (the GFS) is what is truly at risk. The GFS is almost entirely dependent on debt which is considered to be money. But the amount of debt vastly exceeds the real assets in the economy. So it’s like a game of Musical Chairs except that there is only one chair for every twenty players. Deflation happens when those who have claims on assets try to claim them and there are not enough assets to pay everyone. (What happens to prices is a different subject.) In the movie The Eclipse in 1962, Michelangelo Antonioni tells of a young woman considering a relationship with a stock broker. She visits him on a day when the market has crashed. She asks him ‘what happened to all the money?’. He looks at her blankly. Clearly, he doesn’t see the money as something that is real, and consequently has no idea where it might have ‘gone to’. This is the way most of us would feel the week after the GFS collapsed. Suddenly, everyone who thought they were rich would feel very poor. But the factories and the farms and the fisheries would still physically be there.

    Would the factories and the farms and the fisheries still be producing goods? I believe that people like John Michael Greer and Stuart Staniford and Barack Obama (GS&O) think that the real economy can be divorced from the GFS. Not without pain and dislocations, but to a significant extent. Perhaps the real economy would produce at 50 percent its current rate. And then, given good public policies, might even recover to perhaps 90 percent of its current rate. Obama, for example, has put in place federal policies which allow the various Cabinet Secretaries to assume enormous powers in the event of a ‘national emergency’. I believe that GS& O think that ‘command and control’ of the real economy can keep it going when the GFS has succumbed to an enormous deflationary event. Looked at one way, the 10 percent who own everything will have lost most of what they thought they owned, but productive capacity is largely the same. (The poverty in money and the continuing availability of excess productive capacity was the issue which preoccupied Keynes during the Depression).

    One of the tricky assumptions in the GS&O scenario is the global nature of the supply chains in the real economy. David Korowicz alerts us to the scope of this problem. I don’t think that the Secretary of Commerce can do very much to keep computers flowing by issuing commands to factories located in the US. When Europe woke up to a broken financial system, they had a lot of meetings trying to come up with a ‘European’ solution. I frankly haven’t kept up with the blow-by-blow on that, but it seems that several European countries are still failing. So I would have to say that the prospects for a happy conclave of global leaders to develop a command and control way through a seize up in the real economy isn’t very promising.

    Another possibility is the emergence of truly local real economies. The GFS disappears very suddenly and the Global Real Economy mostly grinds to a halt. But there is a lot of knowledge around about how to produce the goods we need to survive. And so energetic people step into the breach and we re-invent a late 19th century town and country economy (sort of James Howard Kunstlerish). Perhaps the production level is 20 percent of the current level, and is focused almost entirely on necessities. In the meantime, probably 50 percent of the population has simply died. It will be like the Black Death sweeping through Europe–but not as bad as the climate catastrophes which reduced humans to a few thousand survivors in Africa. As in Kunstler’s stories, a precondition is the destruction of all the rules and regulations imposed by the present layers of government. Nobody will have time to get permission to put up a windmill to generate power.

    Over the centuries after a collapse, the world may go into a Peak Oil Funk or humans may rise to their potential and figure out a glorious future which involves much lower levels of consumption. Maybe some of the insights in Gary Klein’s book will be useful.

    I have tried here, not to exercise my crystal ball, but simply to outline some potential ways the situation might evolve.

    Don Stewart

    • Thanks! I agree that supply lines are what are likely to go. And as you point out, we are terribly dependent on these. We were reminded of this a few weeks ago, when our electric power was out for 16 hours. We felt fortunate to have water still running, and of course cars still with gasoline in them.

      Also, I agree with you that quite a few people think the Global Financial System can be divorced from the economy. We would just figure out a new system (in a week or two!), and the world would go on pretty much as before. One scenario I could imagine is lots of local currencies–the problem is that they wouldn’t be very good for getting anything from a distance.

    • xabier says:


      Very interesting to consider collapse of the current system like that, by subtraction as it were. The failure of the Roman State/economy must have seemed like that to the citizens of the Empire: people become poorer; many go bust and are enslaved; the soldiers go; the wine from a distant province no longer arrives so regularly or perhaps stops; the technician to repair the heating/water system can’t be found anymore, and so on.

      We are at the first stage, where more and more ordinary people find they have ever less spare money to buy into what the extended supply chains have to offer them. First the ‘luxuries’ go, then non-discretionary items are squeezed. Then people half-starve (see the less fortunate in Greece now.)

      I think it’s very significant that multinationals are marketing ‘Third World’ sizes of packet goods in southern Europe now – suitable to the incomes of people who get by week to week and can’t buy bigger quantities at any one time.

      The next stage will be for the breadth of product offered to diminish.

      The supply lines are holding, for now. Logically, undergoing a voluntary process of subtraction, shortening the length of the supply chain on which one depends on a daily basis, is a way to make oneself a bit more resilient.

  8. Christopher Johnson says:

    Napoleon maybe copied that idea (Toulon light artillery threaten UK & Spanish forces) from the US militia who dragged pieces (fixed, not wheeled) from Ticonderoga to Boston Outskirts, driving away the British fleet. And boy were they miffed: how dare those scraggly ragamuffin. Thankfully, snow and very cold weather made it possible for human mules to drag the heavy guns. And not to denigrate Napoleon, who was a heckuva military leader.
    Remember that US Army General who was responsible for all the logistics in Desert Storm? I forgot his name, but remember he was hired soon thereafter by Sears and Roebuck to help solve similar problems. In the Pentagon they say ‘anybody can talk about strategy and tactics; the pro’s talk about logistics’
    Cheers, Chris

    • xabier says:


      Logistic problems defeated Hitler and Napoleon in Russia, and Rommel in North Africa: just too far from home. Strategy is one thing, but good boots and a full stomach and magazine is quite another pressing matter for any soldier.

      Napoleon made the (in hindsight) foolish assumption that he’d find Moscow packed with supplies and warm accommodation, only to see it burned before his eyes. It is only fair to add that no-one in civilized Europe would have anticipated such action by the Russians, burning their ancient capital. In the jargon of today, that was his Black Swan event. Even then, he didn’t appreciate the magnitude of the disaster and thought it merely inconvenient.

      Rommel is actually particularly relevant to this discussion on the stages of collapse, illustrating how the most magnificent mechanism – in this case his tank corps – and highly skilled technical personnel, can rendered useless when key parts become unavailable and the fuel runs out: out on a limb in North Africa, his supply chain was just too fragile.

      Greer maintains that people will just rebuild industrialism after any major shock: but the real consideration here is how major the shock is, its exact nature and whether it is global or confined to one region and, above all, the impact on our over-extended supply chain.

      • Christopher Johnson says:

        Thank you, Xabier and Don. Correct and couldn’t be better. One thing to add, however: at least some claiming appropriate knowledge: German soldiers retreating westward in ’44-’45 were low on food and other supplies, tried raiding the Russian rear areas. The only problem was that those no longer were Russian troops; they were speaking Central Asian languages and what they ate the Germans could not fathom…

        Perhaps someone should ask Greer if he knows why the width of a Roman mule’s hindend determined the throw-weight of the Space Shuttle. It’s one of the more elegant (if you will) examples of unintended consequences.

        Of course you know that the Roman roads were sized to accommodate a marching legion, which meant their logistics carts, pulled by six mules.. After the decline, local residents enhanced their stock of building supplies by including the flagstones from the roads. This led to the drainage problems and rutting, generally at a fixed distance equivalent to the wheelbase. Wagon builders maintained the standard dimension for wheel distance, so when it came time to make railroads in Pennsylvania the first steam engine was put on top of a standard country wagon. Track was added later. Different scales emerged and affected Civil War operations. but eventually the entire US railway system became wedded to the 56 1/2 inch standard. This also determined the size of the cars and the tunnels they would have to bore. Morton Thiokol won the contract to provide the booster rockets for the Space Shuttle program, but shipping them from Utah through dozens of mountain tunnels had an interesting impact, and nobody was willing to close down the rail lines while they widened the tunnels, or make the needed investments to bore new tunnels, etc.

        Ergo, a tip of the hat to the early Roman logisticians and muleskinners as well as to the English country folk whose very natural actions affected 20th Century technical developments in ways no one could have anticipated.

        Mr. Greer may want to learn that lots of stuff happens that nobody can or will anticipate ahead of time. Didn’t Yogi Berra say something about that?

        Cheers, Chris

    • Don Stewart says:

      Dear Christopher
      The guns at Ticonderoga were heavy, fixed guns. Napoleon proposed wheeled artillery. The general in command of the Toulon operation for the Republic refused his ideas. That general was fired, a new general was appointed, and Napoleon got his chance. It is doubtful that the Republic could have moved any heavy artillery up to the top of hills which were held by the British and Spanish armies.

      The book gives lots of examples of copying. For example, the British destroyed a good part of the Italian fleet with air attacks launching torpedoes at battleships. Both the Japanese and the US naval commanders duly noted the British success, and both understood the significance for Pearl Harbor. The US commander sent a memo on the subject, but got distracted and did not follow up. The Japanese did follow up, and did develop some new technology which gave them the ability to use air launched torpedoes in shallow Pearl Harbor.

      Don Stewart

      • Christopher Johnson says:

        Don, of course you are right. Thanks for your reply.

        I erred in saying maybe Napoleon ‘copied’; what he did was adapt to the situation, and he actually developed a superior way to employ light artillery that may have become a standard. ‘Fustest with the mostest…’

        And of course you are also right about the sporadic use of new ideas. Unfortunately or not, the primary role of peacetime military leaders, especially in a democracy, is to win the budget battles against their competitors. Which often necessitates ignoring something useful that their competitor, or a more distant third party may have done, since it would conflict with the other objectives.

        The Billy Mitchell story is a good example. After he sank the Ostfriesland in July 1921 off Cape Hatteras, the Navy could no longer claim invulnerability to air attack, so they began to develop the air arm. The Army Air Corps, however, after doing that one trick to an anchored battleship, never really practiced dive bombing and getting in close to increase accuracy against a maneuvering target. At least until about 1942, other than visionaries such as Claire Chennault — who also anticipated Pearl Harbor being attacked…

        That’s why they pay big bucks to all those senior officers with too many stars on their shoulders: to fight the bureaucratic battles and secure the treasury funds for their little portion of the MIC.

        Cheers, Chris

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