Why Standard Economic Models Don’t Work–Our Economy is a Network

The story of energy and the economy seems to be an obvious common sense one: some sources of energy are becoming scarce or overly polluting, so we need to develop new ones. The new ones may be more expensive, but the world will adapt. Prices will rise and people will learn to do more with less. Everything will work out in the end. It is only a matter of time and a little faith. In fact, the Financial Times published an article recently called “Looking Past the Death of Peak Oil” that pretty much followed this line of reasoning.

Energy Common Sense Doesn’t Work Because the World is Finite 

The main reason such common sense doesn’t work is because in a finite world, every action we take has many direct and indirect effects. This chain of effects produces connectedness that makes the economy operate as a network. This network behaves differently than most of us would expect. This networked behavior is not reflected in current economic models.

Most people believe that the amount of oil in the ground is the limiting factor for oil extraction. In a finite world, this isn’t true. In a finite world, the limiting factor is feedback loops that lead to inadequate wages, inadequate debt growth, inadequate tax revenue, and ultimately inadequate funds for investment in oil extraction. The behavior of networks may lead to economic collapses of oil exporters, and even to a collapse of the overall economic system.

An issue that is often overlooked in the standard view of oil limits is diminishing returns. With diminishing returns, the cost of extraction eventually rises because the easy-to-obtain resources are extracted first. For a time, the rising cost of extraction can be hidden by advances in technology and increased mechanization, but at some point, the inflation-adjusted cost of oil production starts to rise.

With diminishing returns, the economy is, in effect, becoming less and less efficient, instead of becoming more and more efficient. As this effect feeds through the system, wages tend to fall and the economy tends to shrink rather than grow. Because of the way a networked system “works,” this shrinkage tends to collapse the economy. The usage of  energy products of all kinds is likely to fall, more or less simultaneously.

In some ways current, economic models are the equivalent of flat maps, when we live in a spherical world. These models work pretty well for a while, but eventually, their predictions deviate further and further from reality. The reason our models of the future are wrong is because we are not imagining the system correctly.

The Connectedness of a Finite World 

In a finite world, an action a person takes has wide-ranging impacts. The amount of food I eat, or the amount of minerals I extract from the earth, affects what other people (now and in the future) can do, and what other species can do.

To illustrate, let’s look at an exaggerated example. At any given time, there is only so much broccoli that is ready for harvest. If I decide to corner the broccoli market and buy up 50% of the world’s broccoli supply, that means that other people will have less broccoli available to buy. If those growing the broccoli spray the growing crop with pesticides, “broccoli pests” (caterpillars, aphids, and other insects) will die back in number, perhaps contributing to a decline of those species. The pesticides may also affect desirable species, like bees.

Growing the broccoli will also deplete the soil of nutrients. If 50% of the world’s broccoli is shipped to me, the nutrients from the soil will find their way around the world to me. These nutrients are not likely to be replaced in the soil where the broccoli was grown without long-distance transport of nutrients.

To take another example, if I (or the imaginary company I own) extract oil from the ground, the extraction and the selling of that oil will have many far-ranging effects:

  •  The oil I extract will most likely be the cheapest, easiest-to-extract oil that I can find. Because of this, the oil that is left will tend to be more expensive to extract. My extraction of oil thus contributes to diminishing returns–that is, the tendency of the cost of oil extraction to rise over time as resources deplete.
  • The petroleum I extract from the ground will consist of a mixture of hydrocarbon chains of varying lengths. When I send the petroleum to a refinery, the refinery will separate the petroleum into varying length chains: short chains are gasses, longer chains are liquids, still longer ones are very viscous, and the longest ones are solids, such as asphalt. Different length chains are used for different purposes. The shortest chains are natural gas. Some chains are sold as gasoline, some as diesel, and some as lubricants. Some parts of the petroleum spectrum are used to make plastics, medicines, fabrics, and pesticides. All of these uses will help create jobs in a wide range of industries. Indirectly, these uses are likely to enable higher food production, and thus higher population.
  • When I extract the oil from the ground, the process itself will use some oil and natural gas. Refining the oil will also use energy.
  • Jobs will be created in the oil industry. People with these jobs will spend their money on goods and services of all sorts, indirectly leading to greater availability of jobs outside the oil industry.
  • Oil’s price is important. The lower the price, the more affordable products using oil will be, such as cars.
  • In order for consumers to purchase cars that will operate using gasoline, there will likely be a need for debt to buy the cars. Thus, the extraction of oil is tightly tied to the build-up of debt.
  • As an oil producer, I will pay taxes of many different types to all levels of governments. (Governments of oil exporting countries tend to get a high percentage of their revenue from taxes on oil. Even in non-exporting countries, taxes on oil tend to be high.) Consumers will also pay taxes, such as gasoline taxes.
  • The jobs that are created through the use of oil will lead to more tax revenue, because wage earners pay income taxes.
  • The government will need to build more roads, partly for the additional cars that operate on the roads thanks to the use of gasoline and diesel, and partly to repair the damage that is done as trucks travel to oil extraction sites.
  • To keep the oil extraction process going, there will likely need to be schools and medical facilities to take care of the workers and their families, and to educate those workers.

Needless to say, there are other effects as well. The existence of my oil in the marketplace will somehow affect the market price of oil. Burning of the oil may affect the climate, and will tend to acidify oceans. It would be possible to go on and on.

The Difficulty of Substituting Away from Oil 

In some sense, the use of oil is very deeply imbedded into the operation of the overall economy. We can talk about electricity replacing oil, but oil’s involvement in the economy is so pervasive, it can’t possibly replace everything. Perhaps electricity might replace gasoline in private passenger automobiles. Such a change would reduce the demand for hydrocarbon chains of a certain length (C7 to C11), but that only reduces demand for one “slice” of the oil mixture. Both shorter and longer chain hydrocarbons would be unaffected.

The price of gasoline will drop, (making Chinese buyers happy because more will be able to afford to use motorcycles), but what else will happen? Won’t we still need as much diesel, and as many medicines as before? Refiners can fairly easily break longer-chain molecules into shorter-chain molecules, so they can make diesel or asphalt into gasoline. But going the other direction doesn’t work well at all. Making gasoline into shorter chains would be a huge waste, because gasoline is much more valuable than the resulting gases.

How about replacing all of the taxes directly and indirectly related to the unused gasoline?  Will the price of electricity used in electric-powered vehicles be adjusted to cover the foregone tax revenue?

If a liquid substitute for oil is made, it needs to be low priced, because a high-priced substitute for oil is very different from a low-priced substitute. Part of the problem is that high-priced substitutes do not leave enough “room” for taxes for governments. Another part of the problem is that customers cannot afford high-priced oil products. They cut back on discretionary expenditures, and the economy tends to contract. There are layoffs in the discretionary sectors, and (again) the government finds it difficult to collect enough tax revenue.

The Economy as a Networked System

I think of the world economic system as being a networked system, something like the dome shown in Figure 1. The dome behaves as an object that is different from the many wooden sticks from which it is made. The dome can collapse if sticks are removed.

Figure 1. Dome constructed using Leonardo Sticks

Figure 1. Dome constructed using Leonardo Sticks

The world economy consists of a network of businesses, consumers, governments, and resources that is bound together with a financial system. It is self-organizing, in the sense that consumers decide what to buy based on what products are available at what prices. New businesses are formed based on the overall environment: potential customers, competition, resource availability, services available from other businesses, and laws. Governments participate in the system as well, building infrastructure, making laws, and charging taxes.

Over time, all of these gradually change. If one business changes, other business and consumers are likely to make changes in response. Even governments may change: make new laws, or build new infrastructure. Over time, the tendency is to build a larger and more complex network. Unused portions of the network tend to wither away–for example, few businesses make buggy whips today. This is why the network is illustrated as hollow. This feature makes it difficult for the network to “go backward.”

The network got its start as a way to deliver food energy to people. Gradually economies expanded to include other goods and services. Because energy is required to “do work,” (such as provide heat, mechanical energy, or electricity), energy is always central to an economy. In fact, the economy might be considered an energy delivery system. This is especially the case if we consider wages to be payment for an important type of energy–human energy.

Because of the way the network has grown over time, there is considerable interdependency among different types of energy. For example, electricity powers oil pipelines and gasoline pumps. Oil is used to maintain the electric grid. Nuclear electric plants depend on electricity from the grid to restart their operations after outages. Thus, if one type of energy “has a problem,” this problem is likely to spread to other types of energy. This is the opposite of the common belief that energy substitution will fix all problems.

Economies are Prone to Collapse

We know the wooden dome in Figure 1 can collapse if “things go wrong.” History shows that many civilizations have collapsed in the past. Research has been done to see why this is the case.

Joseph Tainter’s research indicates that diminishing returns played an important role in the collapse of past civilizations. Diminishing returns would be a problem when adding more workers didn’t add a corresponding amount more output, particularly with respect to food. Such a situation might be reached when population grew too large for a piece of arable land. Degradation of soil fertility might play a role as well.

Today, we are reaching diminishing returns with respect to oil supply, as evidenced by the rising cost of oil extraction. This is occurring because we removed the easy to extract oil, and now must move on to the more expensive to extract oil. In effect, the system is becoming less efficient. More workers and more resources of other types are needed to produce a given barrel of oil. The value of the barrel of oil in terms of what it can do as work (say, how far it can move a car, or how much heat it can produce) is unchanged, so the value each worker is producing is less. This is the opposite of efficiency.

Peter Turchin and Sergey Nefedov have done research on the nature of past collapses, documented in a book called Secular Cycles. An economy would clear a piece of land, or discover an approach to irrigation, or by some other means discover a way to expand the number of people who could live in an area. The resulting economy would grow for well over 100 years, until population started catching up with resource availability. A period of stagflation followed, typically for about 50 or 60 years, as the economy tried to continue to grow, but bumped against increasing obstacles. Wage disparity grew as wages of new workers lagged. Debt also grew.

Eventually collapse occurred, over a period of 20 to 50 years. Often, much of the population died off. An inter-cycle period followed, during which resources regenerated, so that a new civilization could arise.

Figure 2. Shape of typical Secular Cycle, based on work of Peter Turkin and Sergey Nefedov in Secular Cycles.

Figure 2. Shape of typical Secular Cycle, based on work of Peter Turkin and Sergey Nefedov in Secular Cycles.

One of the major issues in past collapses was difficulty in funding government services. Part of the problem was that wages of common workers were low, making it difficult to collect enough taxes. Part of governments’ problems were that their costs went up, as they tried to solve the increasingly complex problems of society. Today these costs might include unemployment insurance and bailing out banks; in ages past they included larger armies to try to conquer new lands with more resources, as their own resources depleted.

Today’s Situation 

Our situation isn’t too different. The economy started growing in the early 1800s, about the time we started using fossil fuels, thanks to technology that allowed us to use them. Oil is the fossil fuel that is depleting most quickly, because it is very valuable in many uses, including transportation, agriculture, construction, mining, and as a raw material to produce many goods we use every day.

Our economy seems to have hit stagflation in the early 1970s, when oil prices first began to spike. Now, some of the symptoms we are seeing are looking distressingly like the symptoms that other civilizations saw prior to the beginning of collapse. Our networked system has many weak points:

  • Oil exporters Governments can collapse, as the government of the Former Soviet Union did in 1991, if oil prices are too low. The fact that oil prices have not risen since 2011 is probably contributing to unrest in the Middle East.
  • Oil importers Spikes in oil prices lead to recession.
  • Governments funding Debt keeps expanding; infrastructure needs fixes but they don’t get done; too many promises for pensions and healthcare.
  • Failing financial systems Debt defaults are likely to be a major problem if the economic system starts shrinking. Debt is needed to keep oil prices up.
  • Contagion if one energy product is in short supply This happens many ways. For example, nearly all businesses rely on both electricity and oil. If either one of these becomes unavailable (say oil to supply parts and ship goods to customers), then the business will need to close. Because of the business closure, demand for other energy products the business uses, such as electricity and natural gas, will drop at the same time. Direct use of energy products to produce other energy products (mentioned previously) also contributes to this contagion.

Unfortunately, when it comes to operating an economy, it is Liebig’s Law of the Minimum that rules. In other words, if any required element is missing, the system doesn’t work. If businesses can’t get financing, or can’t pay their employees because banks are closed, businesses may need to close. Workers will get laid off, and the inability to afford energy products (economists would call this “lack of demand”) will be what brings the system down.

Modeling our Current Economy 

Everywhere we look, we see models of how the energy system or the economy can be expected to work. None of the models match our current situation well.

Growth will Continue As in the Past It is pretty clear that this model is inadequate. Every revision to growth estimates seems to be downward. In a finite world, we know that growth at the same rate can’t continue forever–we would run out of resources, and places for people to stand. The networked nature of the system explains how the system really grows, and why this growth can’t continue indefinitely.

Rising Cost of Producing Energy Products Doesn’t Matter In a global world, we compete on the price of goods and services. The cost of producing these goods and services depends on (a) the cost of energy products used in making these goods and services (b) wages paid to workers for producing these services (c) government, healthcare, and other overhead costs, and (d) financing costs.

One part of our problem is that with globalization, we are competing against warm countries–countries that receive more free energy from the sun than we do, so are warmer than the US and Europe. Because of this free energy from the sun, homes do not need to be built as sturdily and less heat is needed in winter. Without these costs, wages do not need to be as high. These countries also tend to have less expensive healthcare systems and lower pensions for the elderly.

Governments can try to fix our non-competitive cost structure compared to these countries by reducing interest rates  as much as possible, but the fact remains–it is very difficult for countries in cold parts of the world to compete with countries in warm parts of the world in making goods. This cost competition problem becomes worse, as the price of energy products rises because we are competing with a cost of $0 for heating requirements. If cold countries add carbon taxes, but do not surcharge goods imported from warm countries, the disparity with warm countries becomes even worse.

In the early years of civilization, warm countries dominated the world economy. As energy prices rise, this situation is likely to again occur.

Price is Not Important  Apart from the warm country–cool country issue, there is another reason that energy cost (in real goods, not just in financial printed money) is important:

The price of the energy used in the economy is important because it is tied to how much must be “given up” to buy the oil or anther energy product (such as food). If energy is cheap, little needs to be given up to obtain the energy. Because of energy’s huge ability to do “work,” the work that is obtained can easily make goods and services that compensate for what has been given up. If energy is expensive, there is much less benefit (or perhaps negative benefit) when what is given up is compared to the work that the energy product provides. As a result, economic growth is held back by high-priced energy products of any kind.

Supply and Demand Leads to Higher Prices and Substitutes  Major obstacles to the standard model working are (a) diminishing returns with respect to oil supply, (b) recession and even government failure of oil importers, when oil prices rise and (c) civil unrest and even government failure in oil exporters, if oil prices don’t keep rising. If there isn’t enough oil supply, oil prices rise, but there are soon so many follow-on effects that oil prices fall back again.

Reserves/ Production This ratio supposedly tells how long we can produce oil (or natural gas or coal) at current extraction rates. This ratio is simply misleading. The real limit is how long the economy can function, given the feedback loops related to diminishing returns. If a person simply looks at investment dollars required, it becomes clear that this model doesn’t work. See my post IEA Investment Report – What is Right; What is Wrong.

IPCC Climate Change Model Estimates of future carbon emissions do not take into the networked nature of the energy system and economy, so tend to be high.  See my post Oil Limits and Climate Change – How They Fit Together.

Energy Payback Period, Energy Return on Energy Invested, and Life Cycle Analysis These approaches look at the efficiency of energy production, comparing energy used in the process to energy produced in the process. In some ways, they work–they show that we are becoming less and less efficient at producing oil, or coal, or natural gas, as we move to more difficult to extract resources. And they can be worthwhile, if a decision is being made as to which of two similar devices to purchase: Wind Turbine A or Wind Turbine B.

Unfortunately, modeling a finite world is virtually impossible. These approaches use narrow boundaries–energy used in pulling oil out of the ground, or making a wind turbine. It doesn’t tell as much as we need to know about new energy generation equipment, together with (a) changes needed elsewhere in the system and (b) whatever financial system is used to pay for the energy generated with that system, will actually work in the economy. To really analyze the situation, broader analyses are needed.

Furthermore, there are the inherent assumptions that (a) we have a long time period to make changes and (b) one energy source can be substituted for another. Neither of these assumptions is really true when we are this close to oil limits.

Where the Peak Oil Model Went Wrong

Part of the Peak Oil story is right: We are reaching oil limits, and those limits are hitting about now. Part of the Peak Oil story is not right, though, at least in  a common version that is prevalent now.  The version that is prevalent is more or less equivalent to the “standard” view of our current situation that I talked about at the beginning of the post. In this standard view, oil supply will not disappear very quickly–approximately 50% of the total amount of oil ever extracted will become available after the peak in oil production. There will be considerable substitution with other fuels, often at higher prices. The financial system may be affected, but it can be replaced, and the economy will continue.

This view is based on writing of M. King Hubbert back in 1957. At that time, it was commonly believed that nuclear energy would provide electricity too cheap to meter. In fact, in a 1962 paper, Hubbert talks about “reversing combustion,” to make liquid fuels. Thus, not only did his story include cheap electricity, it also included cheap liquid fuels, both in huge quantity.

Figure 3. Figure from Hubbert's 1956 paper, Nuclear Energy and the Fossil Fuels.

Figure 3. Figure from Hubbert’s 1956 paper, Nuclear Energy and the Fossil Fuels.

In such a situation, growth could continue indefinitely. There would be no need to replace huge numbers of vehicles with electric vehicles. Governments wouldn’t have a problem with funding. There would be no problem with collapse. The supply of oil and other fossil fuels could decline slowly, as suggested in his papers. Assuming that it is possible to extract about 50% of oil supply after peak is equivalent to assuming that the networked economy will hold together indefinitely–there will be no problem with collapse.

But the story of the cheap, rapid nuclear ramp-up didn’t materialize, and we gradually got closer to the time when limits were beginning to hit. Major changes were needed to Hubbert’s story to reflect the fact that we really didn’t have a fix that would keep business as usual going indefinitely. But these changes never took place. Instead the view of how little change was needed to keep the economy going kept getting downgraded more and more. “Standard” economic views filtered into the story, too.

There is a correct version of the oil limits story to tell. It is the story of the failure of networked systems. That is the story I am telling in my posts.

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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967 Responses to Why Standard Economic Models Don’t Work–Our Economy is a Network

  1. VPK says:

    One aspect, as costs increase, somewhere, some place, expenses must be cut.
    One example is “safety inspections”,

    Despite a new report showing that 40 percent of all high-risk oil and gas wells on public lands across the United States did not pass a safety inspection from 2009 to 2012, a powerful oil and gas industry trade group has doubled down on its opposition to the Obama Administration’s proposal to fix the problem.
    Despite the need for safety inspections, the opposition of the oil and gas industry and its allies in Congress means the Obama administration faces an uphill battle with its proposal.
    BLM has included its inspection fee reforms in fiscal budgets over the past five years, but the proposals have not yet been approved. The agency is working to make its case to Congress in the hopes that it will approve the fee this yea

    • It becomes very hard to cut back. We really need the government services we are getting–probably more such services. Joseph Tainter talks about increasing expensive solutions to increasing complexity. And these come at a time when we need to cut back.

      • dorji yangka says:

        Madam Gail,

        wonderful explanation, logically entwined!

        1)Will the civilization collapse, if the so called sustainable development practices are put into practice at every level?

        2) I presume this finite world issue, diminishing returns and collapse of civilization as a natural phenomenon, the cyclical cause and effect? nothing last for ever and everything is destined to end?

        would appreciate your priceless comments!

        • Dorji,

          1) I am afraid civilization will still collapse, if so-called sustainable development practices are put into place. Sustainable development isn’t really sustainable, at least as it is generally practiced. Most assume they can continue to use some oil, natural gas, and coal (so that they can use, for example solar PV, and the government, roads, and the financial system can stay in place), but it is hard to see how this is possible in a networked system. They also don’t focus on the real need to reduce population, if we have to get along without oil, natural gas, and coal. In order for humans to be sustainable, we have to live within the parameters of natural selection–but the whole point of the practice of medicine is to defeat natural selection. So are the many biological changes made to food production, to get more food now (but doing so makes the process less sustainable long term).

          2) Everything we can see says that diminishing returns and the collapse of civilizations are natural phenomenon. Civilizations are “dissipative structures” formed in “open systems,” that is, systems that receive energy from outside sources, as we do from the sun. Other examples of dissipative structures are hurricanes and plants and animals of all kinds. All of these things seem to follow a similar life cycle–growth, plateau, and then fairly quick collapse toward the end. Sorry I didn’t get to that issue in the post.

          • Coilin MacLochlainn says:

            Gail, I really love your theories, your well-thought-out and reasoned arguments, your accurate predictions…but I have to say I am totally disillusioned by your failure to accept the dangers of climate change and rising greenhouse gas emissions. You are not factoring these in, Gail. And what’s worse, you are pretending they don’t exist.

            Gail, you are selling us short here, you are not accepting these very obvious facts and building them into your thesis. You are downplaying and ignoring the very rapid climatic changes being forced by human activity. You are failing to admit your blindspots, preferring instead to disagree with commentators on your blog, however crazily.

            Gail, you are a climate change denier and you think it’s ok to burn oil, right now and for a long time. But, Gail, it isn’t, and you need to get your head around that. Until you do, I won’t believe you again. It’s time for a reality check, Gail.

            • John Doyle says:

              I’m not answering for Gail, but your idea that she and others are not factoring in climate change as much as you would expect is simply one of timing.
              Climate change is not what is going to cause our collapse, but it will stop us from going back to where we came from, economy wise.
              Climate change is too slow to be a trigger for our collapse. It’s still useful because as we see events unfold in real time we are being made aware of just how much we have overexploited our environment.
              We are much more aware of Reality than you erroneously write.

            • Unfortunately, we don’t have good options. I agree that the climate is changing, and that humans actions are likely causing at least part of that climate change. But I am not convinced that we really have the power to fix the situation, as nice as that might be. We can start collapse a bit quicker, or we can shift production of goods to coal using nations, but I am doubtful that those actions are really beneficial. Starting collapse a bit quicker would theoretically help climate change, but I am not convinced it would help humans. (Some people feel differently on this.) Shifting production of goods to coal using nations, which is what carbon taxes have tended to do, is worse than useless.

              When the effect on economies is factored in, we are very rapidly coming to the end of oil use. Because of this, I don’t think burning it is a big issue. Burning it for a long time isn’t going to happen. I am not out campaigning against the IPCC, just pointing out that when they put together their range of forecasts, the upper end of the range uses a very unrealistic estimate of fossil fuels–something that can’t really happen.

            • CTG says:


              The effects of climate on humans will be much slower and in the end, it will be the economy or finance that will cause the collapse. The collapse cause by finance will be much quicker and probably climate will just wipe out the last remaining homo sapiens.

              Just give this a thought for the following scenario – next week, ISIS causes a lot of mayhem and damage in Iraq and the oil output drops 60% and the damage is extensive. It will take months or years to restore the output. The price of oil will go up quickly. High oil prices will cause a huge slowdown in the economy and business will close. Debts defaulted and banks are in jeopardy. If the situation is critical, more banks will close. Unlike 1930s where your grandfather may have a bundle of money in the mattress, we don’t. A lot of people are basically up to their necks on debts and have little cash. If bank closes, then social upheaval will be a problem. If the Fed steps in and print money to satisfy the needs of the people, then you have very high inflation but no jobs.

              With high leverage, many banks and investment institutions (hedge funds, pension funds, etc) will be busted. Credit will collapse and no banks with trust each other. No credit given, international trade dries up and the supply chain breaks.

              When a supply chain breaks in this complex world, just one week is enough to cause irreparable damage and it may not recover (see UK 2000 blockade as an example). We were at the precipice in the 2008.

              Based on my experience and knowledge, we did not learn from the 2008 Great Financial Crisis and in fact, the situation now is even worse off that in 2008 (in terms of debts, leverage, junk and other financial measurement matrix). When the next one happens, it may spell doom for human civilization.

              We cannot step down. We are too dependent on electricity and technology. We have lost a lot of local and “natural knowledge”.- anyone knows how to identify which plants cure fever? anyone knows how to make candles?

              If credit disappears, global trade will disappear and food security is really questionable. How much food is produced within 10km of the region you are staying ? 10km is probably the max one can walk to market to sell their produce.

            • I should also add to a link to a post by Dave Rutledge, who has written peer-reviewed papers about future coal production and amounts of reserves.


              According to the above linked post by Dave Rutledge:

              Now that Working Group 3 has put its chapters on line, all six thousand pages of the IPCC’s 5th Assessment Report have arrived. Coal is the specter that looms.

              In the IPCC’s business-as-usual scenario, Representative Concentration Pathway (RCP) 8.5, coal accounts for half of future carbon-dioxide emissions through 2100, and two-thirds of the emissions through 2500. The IPCC’s coal burn is enormous, twice the world reserves by 2100, and seven times reserves by 2500. Coal so dominates that it is not an exaggeration to say that the IPCC and climate-change research programs depend on this massive coal burn for their existence. Without the threat of coal, the IPCC could close up shop and the research program funding would drop to a small fraction of what is spent on research in weather forecasting.

              Dave Rutledge then goes on to point out that coal reserves invariable prove too optimistic, when actual production takes place. Thus, the actual amount extracted is likely to be considerably less than the amount of coal reserves (which is base that is used in the above quote). Even when the IPCC had peer reviewed papers pointing this out shown to them, they refused to change their projections.

              It is not as if this is the first IPCC report with this problem. There has been an ongoing conflict with peak oil groups for a long time, saying that their models use ridiculous future fossil fuel projections. Arguably, they made mistakes elsewhere that offset problem, but it is hardly a way to write a report sent to world leaders everywhere.

              I am a co-author on a peer reviewed paper with respect to Chinese coal. Our estimate showed that Chinese coal production would begin declining no later 2025 to 2030. Dave Rutledge says that his current estimate for China is consistent with the estimate we got for China.

          • dorji yangka says:

            Gail, thank you for your kind reply.
            no offence intended………… I do agree that population growth needs to be controlled. but I guess un-sustainable consumption habits (both durables and perishables), wasting and being extravagant which are prominent with the high income people are some of the critical factors that cause resource depletion.

            how should the current economic model be improved to reflect the finite world? prevailing models have 50-100 years for long term increasing projection, which is inline to the 1st half of the secular cycle shown in your post.
            do we know whether we reached the downward trend of the secular cycle or not?
            why should we blame scientific achievements and medical advances in denying the natural cycle? don’t we all like to live longer?
            I personally see the extravagant living style of high income people as one dominating factor causing debt spirals and faster resource depletion, even as we talk about poverty free world and energy for all.

          • dorji yangka says:

            madam gail, I am still awaiting for your kind response for queries raised on June 28… how should the existing economic models be improved to incorporate the finite world issues? why do you blame scientific advancements in countering the natural process?

            • The first thing they have to do is readjust the supply and demand model for oil. Oil is a necessity, with no substitute for many of its uses. At the same time, the sales price cannot rise above what consumers can afford. In fact, the price needs to be held up with a lot of debt, or it drops to far below current production costs.

              I don’t understand why you think I blame scientific advancements for countering the natural process. I am just stating the way things work. The world was set up so that every species would have more offspring than needed to survive to maturity. With the help of energy products (and technology to use those energy products) we have found lots of ways around survival of the fittest. Population has grown, and many who have survived, probably shouldn’t have. We think we are smart, but we can’t keep up the pattern we have started, partly because of the rising cost of extracting fuels, and partly because our solutions aren’t permanent ones. We keep needing new antibiotics, new weed killers, new solutions for our overweight society that eats too much processed food.

        • Christian says:

          Dorji, you are from Buthan and this is the only country trying to do something about these issues, at least at the extent organic farming is encouraged. Could you explain something about it to us?

          • dorji yangka says:

            hey christian, thank you for bringing my small country here in this great discussion.
            I may not be doing the required level of justice in explaining to you on the organic farming, since I have no knowledge on the true essence of organic farming. yeah, of course it is being encouraged and the market is seeing more and more of such produce. farmers and community co-operatives are liking the move and the department of agriculture is very persuasive. However it is really coming at a high price compared to the one we get from India. Bhutan is currently going through acute shortage of Rupee reserve, and I guess this factor is playing a crucial role in promoting organic farming.

            • Christian says:

              Your small country may happen to be one of a few “reserves” for Mankind in the times coming. I remember a sci fi book in which all Eart was finally deserted excepting high mountains, the Andes and Himalayas. Anyway, may be you should go deeper upon this, it’s interesting this is a multilevel policy. Don’t forget the hand tools, don’t know when Rupees coming will end.

            • ordinaryjoe says:

              Dorji Yanka
              Hows the trees and forests doing there? Beetles eating everything here.

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  4. foodnstuff says:

    Reblogged this on Foodnstuff and commented:
    Here’s my favourite blogger, Gail Tverberg, connecting dots again. Looking at the points she makes in this post makes it easy to understand why it’s so hard to get all the interconnected problems of energy decline into the 30-second sound bite that most people can cope with. Hence you simply cannot tell people about peak oil. They have to be given this sort of stuff to read, re-read and contemplate. And the average Joe isn’t interested.

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  6. Paul says:

    Was just watching CTV news here in Vancouver and the Can Govt is planning to hand out iodine tablets to everyone living with 10km radius of every nuclear facility in the country…. massive numbers of people… no explanation of why…

    Canada has had nuclear plants for decades — why this now?

    Call me a cynic but me thinks they are doing this because they expect that the plants will go sky high when the SHTF — as we have discussed before how do we keep these beasts cool when there is utter chaos and no oil available….


  7. John Doyle says:

    Very interesting blog, Gail.
    As an aside, who is the Leonardo whose dome is featured in Fig1? I know a Leonardo Mosso who works with such items from my years in Turin, Italy.
    Apart from that, which weakness in your view is likely to be the trigger [as per Liebig’s law] for the breakdown of our civilization? I used to think it would be debt, but sovereign nations can never go bankrupt, they can create money effectively endlessly, forming a debt which they never have to repay, and which is impossible to repay anyway. So this distorted system might outlast one of the other triggers[?] I believe already the USA is $280 trillion in debt, but for them, who cares?!
    As you suggest we are in a stagflation era funded solely by debt.
    In fig. 2 the graph timeline reminded me of several of the Chinese dynasties which also lasted 250-300 years approximately. It’s a shape similar to a cresting wave, with a steep forward face. Do you think the bell curves we see today should have a steep forward face, a steep decline?
    BTW, we have plenty of oil under our feet do we not? It’s called roads. We can mine them when the going gets tough.

    • Harry says:

      Sovereign Debt creation cannot continue indefinitely without consequences. Pumping artificial wealth into a closed system plays havoc with price discovery and undermines the faith that glues the system together. As fiat currency becomes increasingly overvalued in relation to our material resource-base, a correction inevitably looms. But you are correct that another “trigger” might get there first.

      • John Doyle says:

        I haven’t yet been able to find just what the consequences might be, so it was a trial balloon to say it, hoping for an answer. So far I have seen this video by Bix Weir with one option;

        I think it will have to be an outside event which makes the issuers of fiat money come to their senses, because right now they are fuelling the debt on which the whole shebang now depends. Hundreds of trillions of dollars are “out there” a fair bit sitting in the big banks, earning interest which though trivial, is stopping them from lending it out and fuelling inflation, which the Government is keen to avoid, because as you say it would undermine the confidence that holds the scam together. The rest is just IOU’s never to be cashed.
        It occurred to me that bailing out the major culprits behind the GFC was not “paid for” by the taxpayers. I don’t know why that idea came up. The currency to bail them out was just credit and they are doing it now but calling it QE.

    • Jan Steinman says:

      “I used to think it would be debt, but sovereign nations can never go bankrupt, they can create money effectively endlessly”

      “Endlessly?” Google “Weimar Republic” to see where that ends!

      • Paul says:

        In Germany you had one country experiencing trouble — and the rest of the world was quite happy to let them sink (with huge repercussions of course) — this time every country is Germany (or worse) — and nobody wants anyone else to sink because it means they sink.

        By rights many countries should have gone the way of Germany — Japan comes to mind… but many others including the US should by rights collapse. But nobody wants them to… many emperors without clothes… nobody says anything

        So while I agree with you — if the entire world believes in the ‘matrix’ that is created — recovery is imminent – and central banks the world over do everything possible to fight the disease — this could go on for some time.

      • Christian says:

        “Sovereign nations can never go bankrupt”. Yep, it’s their population who does, till they revolt. Can come to Argentina and ask, but better wait a couple of weeks that those hedge funds leveraged by Griesa judge really get us

        • John Doyle says:

          It’s common sense to imagine that must be the case, but it’s not what’s actually happening, which is why I have been unable to find what WILL happen. The best explanation is in MMT, modern monetary theory. None of the standard theories has an answer. Other theories all end up with gold and silver and apparently that’s not it either.[?]
          Bill Mitchell seems to know about it.

          • Christian says:

            Good one John!

            “The best thing for Argentina would be for its government to announce to the world that it will never borrow again…” It’s exactlly what I’ve been saying in my latest post, some months before this problem finally arised (now off-line for revision on some other issues). And I added we must go that way until the final crash in the global financial system (not looked what this Mitchell thinks about it).

            Two points: a) nobody wanted to recognise the near end of the GFS, too much scarying idea, so my proposal was dismissed; b) I am not sure we would still be able to drive our international trade in case our accounts in the US were closed or seized by the creditors

        • I think the tendency will be for governments to disintegrate, and the countries to split into smaller pieces.

          • John Doyle says:

            Well it stands to reason that reverting to a tribal existence is on the cards. It has always been a successful survival arrangement.
            But it will mean civilization is really back near the stone age.
            If electricity use becomes difficult our civilization’s memories will in large measure be lost. So much of what we do today is only stored electronically. Already it’s hard to access info on old technology, like floppy discs. There will probably be no internet either. It’s going to be grim if we cannot salvage much of what we have created. But the longer we travel on the BuA path the less will survive for our future.

            • palloy says:

              Definitely no internet, but not back to caves. Probably back to proverty/disease-striken 17th century, once the survivors have got on their feet again.

          • no nation can be bigger than the energy base that created and supports it. Hence the USA—for instance–will break up once the roads railways and air travel are not there to knit it together.

            I would guess back to the 17th c-ish, because, a / knowledge can’t be unlearned and b/ that was the population level we had before the industrial revolution.

    • ravinathan says:

      Mine the roads for oil? Are you serious? What would be the energy costs and EROEI of doing so?

      • That is a detail. But the asphalt is right at the surface, so it is probably better than oil sands in Canada. Natural gas would be needed in the process of breaking the length of the chains.

        • John C Green Jr says:


          I’m not sure mining highway and byway asphalt to be converted to fuel is what’s going to happen. I believe BAU, the exponential growth and progress it implies, will continue until it can’t. USA is having trouble keeping its infrastructure functional. Many rural jurisdictions are converting badly potholed asphalt roads to improved gravel roads at a much lower cost than repaving. Caterpillar thought the market was big enough to justify development of the RM 300 …

          In action 3:04 video:



          and RM 500 …

          In action 3:01 video:



          Factoid from Richard Heinberg’s The End of Growth published in 2011 so “last year” was 2010 ..

          I live in Sonoma County, California, where officials declared last year that 90 percent of county roads will be allowed to deteriorate and gradually return to gravel, simply because there’s no money in the budget to pay for continued repairs. Perhaps someone who lives on one of these Sonoma County roads will mail-order the latest MacBook Air (a shining aluminum-clad example of Moore’s law) for delivery by UPS–only to be disappointed by the long wait because a delivery truck has broken its axle in a pothole (a dusty example of Murphy’s law).

          Guess wine doesn’t bring in the income Silicon Valley does. It is one of the nine counties of the SF Bay Area:


    • Actually, these sticks are named after Leonardo da Vinci, and seem to be partly a teaching device. http://www.rinusroelofs.nl/structure/davinci-sticks/introduction/introduction.html

      I am wondering if the problem where oil producers/exporters need ever-more-oil, but oil consumers cannot pay ever-higher prices is what brings us down. We are already in an “overshoot” period is this regard–oil companies realize that there is a problem, but it takes a while to initiate changes. Lack of high enough prices exacerbate Middle Eastern problems. I am thinking about writing a post about this issue. We are living in Wile-E-Coyote land.

      The bell curves we see represent a totally different situation than our current situation. With a bell curve, the decline of the energy product in question does not produce a shortage of any kind, because there are plenty of replacements (at the same price) coming on line. This is true on the upslope of oil production. It is totally nonsense in my view to assume a bell curve on the downslope in my view. There is a growing population to feed, clothe, and transport. They are not likely to be happy about a major drop in standard of living (among other things). I should have made this point, but the post was way too long as it was.

      I have thought about mining the roads too. Auto drivers would probably not be too happy though. Building concrete roads is expensive and CO2 intensive.

      • oddly enough–the term ‘pot hole’ derives from an old English practice where potters were inclined to scoop handfuls of clay from (clay based) road surfaces in the 18th c, and use it to make pots. Hence the term pot hole

        • yt75 says:

          About paving, I learnt that in the Victorian era, most London streets were wooden paved.
          In below documentary I think :
          (can be found on youtube as well)

          • John Doyle says:

            I remember in Sydney the main thoroughfares in the city were paved with wood. The blocks were laid end grain up, roughly 6″x3″ x 6″ deep. They were very successful next to the tram lines as they didn’t form potholes. The last ones I remember were in some back streets into the 1980’s

            • Christian says:

              Buenos Aires had some wooden paved roads too. But this was done with hard woods now almost extinct

      • John Doyle says:

        Thanks for the reference to the REAL Leonardo. I knew nil about that aspect of his work.
        Re oil, it seems we are damned if the price rises and equally damned if the price falls. I don’t think we are in a Goldilocks stage now either.
        As for mining the roads, we will still need technological expertise to do the refining, but tarred roads will in vast measure become redundant, and dirt roads will suffice. I imagine it is a large resource. Already in the US some states have reverted to dirt roads because of cost, just as some cities are switching off street lights. So signs all is not well are multiplying. Soon nobody will fail to notice.

      • Stilgar Wilcox says:

        “I am wondering if the problem where oil producers/exporters need ever-more-oil, but oil consumers cannot pay ever-higher prices is what brings us down.”

        My take on this is the same, Gail. It just makes sense that with the extraction of a finite resource like oil, as diminishing returns sets in, price rises to an affordability level and not to the extraction cost + profit. There is a presumption it would, but like all things there is a limit. That immediately reduces URR. People keep saying there’s this much Orinoco, Tar Sands, Arctic, Anwar, fracking tight oil, deep water, etc. but what I think will happen moving forward from here as the world economy continues to further fiscally stress, oil price will drop. Sure we’ve had a recent minor rise in oil price, but that is short term for geo-political reasons. In the long haul I think price has to keep dropping further to match declining affordability, in turn reducing profitable drill sites.

        As this process continues; 1. URR, 2. consumer affordability and 3. oil company/country profitability all drop in unison, (with the exception of occasional minor upturns). With URR constantly getting redefined to lower amounts, future supply will become insufficient to counter extraction rates, with oil descending from peak at some juncture. I would not think that is too far off, but then again the crude plateau has been going on since 05, so predicting when the descent initiates is not easy.

        • Paul says:

          Seeking Alpha — a prominent investment site — suggests 2018 as the peak for shale oil. Since shale (and to some extent tar sands) — is what is between us and much higher prices — then 2018 could be the tipping point — of course conventional global oil production continues to drop so the tipping point could certainly come sooner — as soon as shale fails to offset conventional declines?

          • Stilgar Wilcox says:

            2018 – very possible. So many predictions are between 2015-2020, some kind of s is bound to htf during those 5 years.

          • CTG says:

            I believe out financial systems will not last that long. Everything seems to be maxed out at the financial world…. (with magic performed by the central bankers every time). I am not surprised if there are fireworks sometime in July/Aug when Q2 shows a very significant GDP contraction

            • Paul says:

              Impossible to put a time on this — one thing is for certain — if the central banks have any further tricks up their sleeves — they will use them as things continue on this downward trajectory

              I suppose the question is all about CONfidence… is there some point where the masses stop believing recovery is possible … and the whole thing just collapses under its own weight?

              Is there something the central banks will do such as some sort of blatant wealth confiscation — that signals we are in the end game?

              I am watching for a situation whereby central banks react to new crisis situation with yet more desperate measures— and their policies do not soothe the beast.

              I find it incredible that the beast has not been on the rampage after it was disclosed that central banks have been into the equity markets to the tune of $29 trillion dollars. Effectively they ARE the equity markets — because without their participation — the markets would implode.

              But even that does not put a dent in CONfidence — in fact the exact opposite — it’s seen as support for the market which means long equities for big money managers… the central banks have your back — they will not allow the market to retrace.

              And they think that when it does come undone they will be nimble enough to navigate the blast zone left behind… because they cannot grasp what is actually at stake here — that the central banks are fighting against the end of growth due to the end of cheap oil — they fail to understand that there will be no recovery — there will be no pieces to pick up.

            • Stilgar Wilcox says:

              “I am not surprised if there are fireworks sometime in July/Aug when Q2 shows a very significant GDP contraction.”

              CTG, I wonder the same. First Qtr. was a huge surprise to many at -2.9% GDP, but it was also in the first Qtr. to get economic feedback from less stimulus, i.e. QE taper, so in that regards at least not a surprise to me who had predicted it here on this website some months ago. Now we end the 2nd Qtr. at 35b QE and we’ll see how much they are willing to lie about GDP (only later to fess up to what it actually was, as they did in the first Qtr.).

              It seems likely the stimulus was temporarily bridging the gap between higher priced oil (less net energy) and recessionary GDP. Now the stimulus (to the super wealthy) is tapering that stopgap is going away and the truer view of how the economy is doing will come to light most likely with a 2nd Qtr. GDP minus number which will by definition mean a recession.

              There was a zerohedge article recently about how banks have invested in stocks to the tune of 29 TRILLION buckaroos. Since the banks always know stuff before we do, just prior to the other shoe falls in regards to a Q2 GDP announcement, I’m wondering if a huge stock market drop occurs as the banks try to pull out all at once. Those computers will start shedding stock en masse and probably hit market loss limits and seize up. When that happens panic will ensue. We shall see if that’s how it goes down… I’m not saying the system will collapse, but the markets will and what follows is anyone’s guess.

            • Paul says:

              Actually it was the FT that initiated the 29T story which ZH picked up on and as usual added commentary explaining the implications.

              What on the surface is rather disturbing is that in spite of the trillions being thrown at the stock and housing markets — subprime autos and who knows what else — GDP is crashing…

              But then we all know the GDP and every other number out of the govt is not real — which begs the question — why do they allow a print of nearly -3% — and why do they allow one of their biggest mouthpieces — the FT — state that 29T has gone into buying equities?

              We are always only ever getting the tip of the berg (if that) — there is always a bigger picture.

            • CTG says:

              Paul, Stilgar – it is always a small issue that causes a huge problem just like the flap of the wings of a butterfly in Amazon causing a storm in UK. Whether this is true or proven, it does not matter as history has shown that just a simple assassination of a Archduke causes WWI and that leads to WWII (due to WWI). So, anything can cause a big outbreak. We will not know what it is until it happens and from the rear view mirror, we can say “ah hah, that is the cause”.

              To me, what we are facing is just like a “husband-wife” facing the divorce lawyer. Why do you want to divorce? – The answer “everything” – new put down the toilet bowl, rude, did not clean up mess. It could be just a simple thing like “why did you not mow the lawn? The answer came back -because I am watching World Cup” thing that causes the wife to go crazy and ask for a divorce. So, is it because of not mowing the lawn that causes the divorce? No. It is everything else. Slowly boiling the frog but it could just be a simple matter. Correct me if I am wrong but I have watched History Channel as saying that the 1929 bank run was caused by someone (a butcher?) saying at the bank counter that he did not trust the banks and wanted the money out. The people beside him heard it and withdrew the money too and before long everyone wanted out.

              What a lot of people are “looking forward” to a crash (not many know that this may end human civilization) is something big happening. The Central Bankers are watching out for that and they will perform all sorts of magic trick to ensure that it does not happen (that is their opinion that it will not happen). This is akin to like the husband-wife divorce of infidelity, not “the many things that is built up over time”.

              I never believe in New World Order or the bankers have both sides (Russia/China vs US, etc) and it is all a show for all to see. By nature, humans are greedy for power and money and tribal. It is not possible for humans to cooperate long term, especially when it come to controlling the world. Do you think the Bilderburgers are meeting secret to control the world? I doubt so. I think they are enjoying themselves and comparing what toys they have. Think about it – putting a hundred power-hungry egoistic rich elites in one room and asking them to follow one set of rules. Put 3 siblings in one room and give them lots of money, you think they will cooperate?

              If the elites are so clever, they would have built additional gas lines and LNG terminals in Europe 20 years ago. The Ukriane-Russia gas threat to Europe start in the 1990s and in 2014, we still have this probelm. From 1990s to now, they would have more than sufficient time to prepare plans to ensure that Russia does not hold Europe by the throat.

              Who cares about statistics, especially when it comes to employment or confidence. U of Michgan confident index is so “fake” and yet people take it wholeheartedly without any questions. Why not just do it on the GDP numbers? Put it at 0.1% rather than -2.9%?

              We are so maxed out in every conceivable matrix be it geopolitically or economically. Everything thing measureable (debt, leverage, etc) is much worse that 2008. We may not need a Lehman to trigger a collapse now.

            • Paul says:

              Excellent post.

              Agree – there is no question something big is coming — will it be the outbreak of a massive war — or the implosion of the financial system — not sure what but without question it will be a monumental event — I think a lot of people can sense that something wicked this way comes…

              But many still have their heads in the sand — they are as you say the proverbial frogs being slowly boiled — even when one points out $29 trillion has been put into the stock markets by central banks most people are not concerned — it’s as if that is BAU — that it’s part of Econ 101… just something you do when it’s needed…

              Any small thing could set the pile of sand crashing down… as is usually the case with these things… the pressure just builds until it explodes like a bag of fermenting dung…

              Looking forward to the crash is like looking forward to committing suicide… when I think of what it means when the end game finally comes — I get a queasy feeling in my stomach…

              Do the central banks think they can stop a collapse? I don’t think they believe that — I think they know it will come — the most they can do is delay it. Recall Bernanke’s parting words — ‘people hate me for what I have done – but when they understand why I did it – they will thank me’

              The Bilderbergers and the PTB do their best to control the world — and they do have a great deal of success — but This Time Is Different. They are powerless in the long run.

              The entire basis of their power — and of civilization > cheap oil — has run out. I am sure they are more scared than anyone — because they would have access to more info — they would have a better idea of what plays out after the SHTF.

              And yes, there are always going to be disagreements between these greedy psychopaths — that’s why we have wars….

              So we observe — and comment — and hope — and enjoy what is left of the days that remain — and prepare — but most of all — we wait.

              A friend/neighbour of mine in BC — he’s nearly 80 — works hard 10 hours a days cutting and selling fire wood, haying and fixing machinery said it very well a couple of weeks ago — it was rainy and chilly and his only comment was — it’s a great day — when you get to be my age every day is a great day — because I woke up this morning.

              Every day I wake up and collapse has not hit makes that a great day — no matter what.

  8. typo?
    “abut the” should be “about then”

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  10. palloy says:

    The IPCC model is not wrong, the AR5 model has been calibrated against the historical data and works OK. No doubt it will be refined in the future, but it is pretty good now. It is the forecast data in the Representative Concentration Profiles (RCPs) that are wrong. Even the lowest scenario, RCP 2.6, has fossil fuel production rates that are too high. The model then correctly predicts what the temperature rise would be under RCP 2.6, and it comes out with a figure that is too high for peakist reality.

    • I guess we have different ideas of where the model stops and ends. If the authors spend huge pains-taking effort on one part of the model, and don’t pay much attention to what is effectively another part of the model, they are likely to produce nonsense in their printed reports. Readers of the printed reports can’t tell what is behind the “issue.”

      • Don Stewart says:

        I think you are being grossly unfair to the scientists. Most scientists know a great deal about a small subject. That is why hundreds of them are required to put together the IPCC reports. Furthermore, Reagan and Thatcher set up the IPCC process so that the final word is with the politicians…not the scientists.

        Let’s suppose a scientist has been busily studying the issue of clouds. There are a myriad of factors which influence the cloudiness in the sky, and thus the direct heating of the Earth by solar energy. Until very recently, no one really had a good idea whether cloudiness would increase or decrease, although most people agreed that precipitation would increase. Why would you think that some scientist who has been deeply immersed in the study of clouds would be able to give you a scientific answer as to the likelihood of a rapid return to the Stone Age for homo sapiens? And if he or she did have an opinion, why would you think that the politicians would put it in the IPCC report?

        If it is your opinion that ‘rapid return to the Stone Age’ is the only credible future scenario, and all the models should reflect that scenario, then you need to apply to be part of the next IPCC panel.

        Any of us can criticize the process that the politicians set up, but I think that blaming the scientists is simply missing the mark.

        Don Stewart

      • palloy says:

        The thing is, you can’t change the model, or at least if you did, no one would take the answers seriously. But you CAN have your own RCP. All you need to do is to state your forecasts for 40 factors, of which FF burning are just 3, at 10-year intervals out to 2100, and have it checked as being consistent by IPCC, and then run your RCP through the model. IPCC abandonned the old scenarios of AR4 and earlier, and went for this more flexible system to encourage people to do just this.

        I have tried getting Aklett, EWG, Patzek to do this, but have had little response. David Rutledge did this for coal in AR4, and I modified his scenario for oil and gas peaks as well, and got peak temperatures of +1.5°C in 2045 and falling very slowly after that.
        But of course no one noticed because it wasn’t published in a refereed journal. This really needs to be done – perhaps you can persuade some of your contacts?

        Don – the politicians have the final word in the IPCC “Executive Summary”, but they don’t control what factors are assessed in the model.

        • Since I am not associated with a university, I have stayed out of the “referred journal” business for the most part. I didn’t realize the IPCC allowed this – I haven’t looked into all of the 40 factors at this point. It is interesting that you got peak temperatures of +1.5 degrees Celsius for Rutledge’s model.

          I’ll keep in mind your idea of talking to some of my contacts about this.

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  16. Stilgar Wilcox says:

    And amongst the major reasons why complex systems can breakdown is regional warfare over energy. In this case control of Iraq’s largest refinery has now finally fallen to ISIS!!!


    Iraq crisis: Key oil refinery ‘seized by rebels’

    Breaking news Iraq’s biggest oil refinery at Baiji, north of Baghdad, is reported to have been fully captured by Sunni rebels.

    The refinery had been under siege for 10 days with the militant offensive being repulsed several times.

    The refinery supplies a third of Iraq’s refined fuel and the battle has already led to petrol rationing.

    Insurgents, led by the group Isis, are expanding their control of towns in the north and west and have captured all border crossings to Syria and Jordan.

    They are also bearing down on a vital dam near Haditha.

    A rebel spokesman said the Baiji refinery, in Salahuddin province, would now be handed over to local tribes to administer.

    The BBC’s Jim Muir in Irbil, northern Iraq, says the capture of the refinery is essential if the rebels are to keep control of the areas they have conquered and to supply the captured city of Mosul with energy.

    How long before the insurgents push south in an attempt to control Iraq’s oil fields?

    • The rebels understand the importance of the refineries.

      I know that in theory Iraq can import finished products so that the residents near the oil fields have fuel. But what if this doesn’t happen in practice? Wouldn’t this be just as effective in cutting of oil from the oil fields as capturing the fields directly? I expect that the workers need fuel for trucks in the fields. Also, I have read stories about workers being sent home. One was about Chinese workers heading home, because of the fighting. Even if some of current production continues, work on new fields will be slowed down as governments require their citizens to leave the area.

      • Stilgar Wilcox says:

        Yeah, taking that refinery hit me today as very big news, but I hadn’t thought in terms of some of the knock on effects you listed. Should be very interesting to see how this unfolds.

    • Paul says:

      I am not sure what is going on in Iraq but something seems fishy … there has to be a bigger picture…

      There is no way in hell the US would allow a terrorist org to shut down Iraqi oil — after all the reason they went to war there was to ensure that Saddam was not able to leverage his few million barrels a day in a tight market to influence events…

      And now the US is going to allow a rag tag bunch of jihadists upset the apple cart?

      No way.

      Here’s one theory on the bigger picture:

      Here is one theory: http://www.globalresearch.ca/the-destruction-and-political-fragmentation-of-iraq-towards-the-creation-of-a-us-sponsored-islamist-caliphate/5386998

      Of course we will never know what is going on because the MSM nor the alternative media have even the slightest clue what is going on.

      The game of chess is played by only those at the very highest levels — and they will never tell us.

      • interguru says:

        You should check out Juan Cole. He is a good source outside the MSM. Here is a recent article
        http://www.juancole.com/2014/06/radicalism-menaces-important.html .

        • Paul says:

          Thanks but that doesn’t give me any new insights into what is actually going on in Iraq — again — if ISIS were a threat to the global oil supply — the US (NATO) would without a second thought be back in Iraq by the tens of thousands…

          There is too much at stake for them to allow a rag tag bunch of jihadists upset the global oil supply.

          • Christian says:

            I agree Paul. The US is just not fighting ISIS, so they are using them. The theory that they almost created them fits pretty well. I just can’t get why they are willing to cut Iraq into pieces beyond the fact it may help destabilising Syria (more that it already is) given Al-Maliki seemed to cause no problems

            • palloy says:

              The US and Saudi Arabia need each other, but they are not close allies – the US has been fighting against Saudi-supported Taliban in Afghanistan for 13 years. They each have their own agenda. The US wants to control the oil using divide-and-rule, while Saudi supports ISIS, but denying it publicly. Saudi wants to reinstate the pan-arab Caliphate with themselves in charge – they already have Mecca and Medina, next Baghdad, then Damascus, then Jerusalem. These proxy forces also get out of control sometimes and do their own thing. The US supports the FSA in Syria and Maliki in Iraq. US can’t help but support ISIS indirectly, but they don’t wish to. Lies, subterfuge, back-stabbing, media mis-reporting all make it difficult to follow, but anywhere you read “US’s close ally Saudi Arabia” it is wrong.

            • The relationship between the United States and Saudi Arabia seems to be gradually lessening over they years. Saudi Arabia really can’t do much for the price of oil, and we are importing less from them, might have something to do with it. There is still the fact that the dollar is the world’s reserve currency, but this effect seems to be gradually lessening as well, as buyers and sellers find a way around using the dollar as more than the method for figuring the price that will be paid.

            • palloy says:

              Saudi Arabia is upset with the US over: continued support for Israel over Palestinians, continued fighting against Taliban in Afghanistan, continued drone attacks on Taliban in Pakistan, failure to fight in Syria, rapprochement with Iran, and now continued support for the Shi’ite government of Al-Maliki in Iraq.

              If the alliance becomes too strained, or the US is suddenly weakened by another financial crash, Saudi could deliver a severe blow by arranging for the GCC to sell their oil in any major currency, hence collapsing the petrodollar. I’m sure they would rather use that threat as a bargaining chip than actually doing it, as they still need US to police the Gulf.

              At the fundamental level, the US is all about divide-and-rule, while Saudi is about pan-Arab strength.

            • Thanks! I hadn’t thought about it that way.

            • Paul says:

              Saudi Arabia is a 100% owned subsidiary of the USA — the House of Saud is bought and paid for — the family is permitted fabulous wealth — in exchange a huge chunk of their oil money goes into US debt — which they can of course never redeem — in exchange the US agrees to ‘protect’ them — kinda like the mafia protects your restaurant — from them….

              So when I hear the Saudis are upset at the US — I have to chuckle — they are like toothless dogs — they can yap all they want but they cannot bite — and even if they could the CIA would tell them ‘remember Saddam — you are either with us or you are not — and if you are not we will turn on you in a second and you will be in a noose and we will find someone to replace you — now go off and enjoy your hookers, your coke, your Prada bags, your Rolls Royces, your private jets — and STFUp…’

            • palloy says:

              Well the US hasn’t said that in any of the cases that I cited where Saudi is doing things that the US doesn’t like. And Saudi spends a fortune on Madrassas across the Muslim world, which are the main recruiting ground for jihadists.

              Just this last weekend King Saud dropped in on Al-Sisi in Egypt to pledge further billions in aid for not allowing democratically inclined Muslim Brotherhood and Qatari Al Jazeera. Then Kerry dropped in and after wagging his finger at Al-Sisi, and lecturing on freedom of the press, Kerry gave him more weapons and Al-Sisi thanked him by giving the journalists 7-10 years and stating the courts were above reproach. Another Saudi slap in the face for the US.

              There’s no doubt that the US could make a horrible mess of Saudi if they wanted to, but would that help keep the oil flowing?

              The real power in Saudi is not the royal family, but the keepers of the holy shrines – the Wahhabists.

            • Paul says:

              Right — but the US is also buddies with terrorists — they are arming Al Qaeda and Al Nusra in Syria …. http://www.telegraph.co.uk/news/worldnews/middleeast/syria/10311007/Syria-nearly-half-rebel-fighters-are-jihadists-or-hardline-Islamists-says-IHS-Janes-report.html

              Of course they created Mr Bin Laden as well…

              Yet the US spends billions on defending against ‘the terrorists’

              Difficult not to conclude that this is not all one big circle jerk with multiple purposes — enriching the elites… scaring the people into giving up freedoms… stirring various nests… etc… etc.. etc…

              A private bogeyman can be very useful

            • palloy says:

              The Telegraph article actually says that the high proportion of pro-Caliphate fighters in Syria is the reason why US-UK didn’t go ahead with their bombing campaign. This implies that they are NOT buddies with pro-Caliphate terrorists, whilst being buddies with purely anti-Assad terrorists. Saudi, on the other hand, IS buddies with pro-Caliphate terorists. Different agendas, see?

              When the US and Saudi interests coincide, like in Soviet-occupied Afghanistan, then they have no qualms about supporting terrorists. But over time they morphed into the Taliban and Al Qaeda and came back to bite the US, but not Saudi. Different agendas again.

              Any time that you read that the US-Saudi relationship is very close, (and there is a lot of it about), you will get the wrong impression about what is going on.

            • Paul says:

              The CIA is arming and supporting rebels in Syria comprised of Al Qaeda and Al Nusra – that is fact. There may be other factions involved there but the majority or at least a major component of those fighting Assad are hard core – fanatical terrorists. And the US is arming them.

              Of course the CIA is going to try to spin this another way — that there are a few bad guys mixed up with the white nights…. that is a load of crap.

              I guarantee you — the CIA is behind the gassing of women and children — think about it — Obama warns Assad not to do that ‘or else’ — so he just ignores that threat and gasses women and children a few weeks later??? Is he stupid? Is he insane? Why would he do that????

              Seymour Hersh — the greatest living journalist — explains exactly what happened in that gas attack — it could NOT have come from Assad’s side of the fence — it most definitely came from the side of the fence were the CIA SUPPLIED rebels are operating

              It is quite obvious why Hersh’s story is not being picked up by the whored MSM — it opens the pandoras box — that the US is gassing women and children — then using that false flag to invade — here’s the story



              US media blacks out Seymour Hersh exposé of Washington’s lies on sarin attack in Syria

              The American media has blacked out an account by Pulitzer Prize-winning investigative journalist Seymour Hersh demonstrating that President Barack Obama and the US government lied when they claimed to have proof that the Syrian government carried out a sarin gas attack last August on areas near Damascus held by US-backed “rebels.”

              Obama, Secretary of State John Kerry, US ambassador to the United Nations Samantha Power and other top officials declared categorically that the August 21 attack on Eastern Ghouta, which reportedly killed hundreds of people, had been carried out by the Syrian military. They, along with the leaders of Britain and France, sought to use the gas attack to stampede public opinion behind their plans to attack Syria, cripple the regime of President Bashar al-Assad, and install a puppet government.

              Seymour Hersh exposes US government lies on Syrian sarin attack

              Pulitzer Prize-winning investigative journalist Seymour Hersh has published an article demonstrating that the US government and President Barack Obama knowingly lied when they claimed that the Syrian government had carried out a sarin gas attack on insurgent-held areas last August.

              Hersh’s detailed account, based on information provided by current and former US intelligence and military officials, was published Sunday in theLondon Review of Books. The article, entitled “Whose sarin?,” exposes as a calculated fraud the propaganda churned out day after day by the administration and uncritically repeated by the media for a period of several weeks to provide a pretext for a military attack on the regime of Syrian President Bashar al-Assad

              Likewise in Libya — the CIA armed the same crazies and they took out Gaddafi and now Libya is for all intents and purposes a failed state.

              I have no doubt that US is allied with terrorist organizations — the only question I have is — why????

              What is the agenda? What is the ‘ends’ that justifies joining forces with the supposed enemy?

            • palloy says:

              When US trainers train a bunch of arabic-speaking volunteers in Jordan, they have no way of knowing who they really are, or who recruited them. So it true that they may inadvertantly train future ISIS soldiers, it can’t be avoided, but that doesn’t mean they want to train ISIS – a organisation that wants to drive the US out of islamic lands.

              A far easier explanation is the one I’ve given already, and it doesn’t leave you asking the question “why?”. Anyway, keep it in mind and try it out as an explanation next time you are puzzled, and you will see it works quite well.

            • Paul says:

              Ya think so? Ya think the CIA are a bunch of bozos from Albuquerque who have not a clue what they are doing? Ya think they don’t know the nature of the people they are training and arming?

              How does that work — they round up layabouts at a billiard hall not having a clue who they are — and say hey boys wanna have some fun — here – guns – bombs – sarin — go to it!

              You think they didn’t know who they were in bed with when they trained hard core Jihadists in Afghanistan to fight the Russians?

              Of course they know — that’s why they use them — they are fantastic attack dogs — rabid stupid attack dogs…

              Obama has called for another big chunk of cash to fund Al Qaeda Al Nusra in Syria — you think he has not seen this video of the CIA proteges eating the heart of a Syrian soldier http://www.liveleak.com/view?i=0c9_1368347673 Of course he knows this is the nature of his beast — he has known from day one when he unleashed it.

              They know EXACTLY who they are training – they have from day one of the Syria conflict — they knew from day one in Libya…

              Don’t believe the US can control the rabid dogs?

              Lets’ rewind a bit —does anyone think the Saudi Prince approached Putin without the permission of the CIA?

              Leaked transcripts of a closed-door meeting between Russia’s Vladimir Putin and Saudi Prince Bandar bin Sultan shed an extraordinary light on the hard-nosed Realpolitik of the two sides.

              As-Safir said Prince Bandar pledged to safeguard Russia’s naval base in Syria if the Assad regime is toppled, but he also hinted at Chechen terrorist attacks on Russia’s Winter Olympics in Sochi if there is no accord.

              “I can give you a guarantee to protect the Winter Olympics next year. The Chechen groups that threaten the security of the games are controlled by us,” he allegedly said.


              If the Saudis control the Chechens — and the Americans control the Saudis… then….

              If you can stop mindlessly believing the US is a beacon of democracy and good in the world (in spite of overwhelming evidence to the contrary) you might begin to escape the haze of propaganda

            • palloy says:

              I certainly don’t believe the US is a beacon of democracy. But neither do I believe the US wants to support the very group that wants to see them out of the ME oilfields. It is a different matter entirely when it comes to attacking Soviet-held Afghanistan or Russian Chechnya or Chinese Xinjiang – there they don’t control the land.

              All I’m suggesting is that the US doesn’t tell Saudi what to do and they just do it. Saudi has a different agenda to US, yet they need each other, so they pretend they are good friends. That is the haze of propaganda that you have to cut through.

          • dolph9 says:

            Hard to say isn’t it.

            Of course, the incompetence of the American establishment is proven already. So even if they were manipulating things, they are certain not to get their aims, which are of course infinitely expanding money and power.

            • Paul says:

              As always we are at best getting the tip of the iceberg… and that is generally all we ever get — even after the fact… I am still not totally certain what WW1 was all about… this version sounds pretty accurate though: http://www.youtube.com/watch?v=GIpm_8v80hw

            • Mjx says:

              Paul, I watched your video of the comic Robert Newton and it was very educational, especially about the start of WWI and the real reason over the oil of Iraq and the orient express that Germany was completing to get oil to get fuel to run its military. The Brits, with Churchill’s help, stopped that all that of course.
              Worth Watching and he is very funny too!
              Thank you

            • Paul says:

              Which has reminded me to pull down something else from him to watch on a flight later today — https://www.youtube.com/watch?v=zaLQA_p4jE4

          • LJR says:

            ISIS is NOT a rag-tag bunch of Islamists – they are a skilled and well-organized military force. You are totally misinformed if you think otherwise. The lode of confiscated memory sticks provided a chilling picture of a highly skilled battle hardened top-down military force.

        • If governments could really afford the handouts they are giving for solar PV and EVs, I would be more enthusiastic. Also, the net metering Juan is getting is very unfair to the utility.

      • Calista says:

        It is difficult to impute direct intent when mere greed or incompetence will do. I dare say that our military contractors are known for a bit of corner cutting.

  17. “The simplest way to measure the approach to a potential tipping point would be to directly measure the recovery time (or rate) of the state of the system back to its initial equilibrium state following a perturbation. In case the system is close to a tipping point the recovery time should increase (or the recovery rate should decrease). This is the essence of critical slowing down.”

    Gail, I’m not sure what particular financial metric you see as most important and perhaps a keystone in the financial system. Which one do you think will have a cascading effect and is beyond the control of CBs. For example, could it be the feedback from return on investment. At what point does “pushing on a piece of string” become ineffective, because FOR NOW the CB do seem to have been successful.

    • We keep seeing references to the fact that the length of time since the last recession is greater than the expected time to the next recession, and the recovery still isn’t very strong–and that is with the quantitative easing.

      I really don’t know which thing will push us over the edge. Will it be a report of some fraudulent action, that no one thought was possible? I know recently I have been sent an article saying the Central Banks have pumped up stock market prices with $29 trillion in buying. Or it could be rising interest rates, or falling oil supply from the Middle East due to collapsing governments. Or could it be a popping debt bubble? We seem to have our choice of lurking problems, not too far away.

      • Paul says:

        The phrase ‘don’t fight the Fed’ is crucial

        Those running institutional money understand that the central banks will absolutely do everything in their power to stop a cascading financial calamity.

        They will bail out corrupt entities (if they are important enough) — they will print — they will back stop — nothing is off the table.

        So the major players will play — understanding that if enough of them do decide to fight the Fed — all will be left with a handful of air.

        So I do not expect that that those running the money that counts – institutional investors — will go against the flow — there is no upside.

        Which means the mechanisms that normally would come into play to ensure ‘what cannot continue will not continue’ are dormant — and by that I mean the short sellers who identify a massive problem and attempt to destroy the cancer — they are not active because even though they see the body riddled with disease… the Fed is pumping in drugs that keep it alive.

        Think back to the housing crisis (or better read The Big Short) — plenty knew what was coming — but only a few shorted it — and they were almost destroyed waiting it out…

        Keep in mind this was before ‘don’t fight the Fed’…. and we had a defying of gravity situation for 3+ years…. Now with the Fed set to do anything and everything… this could go on for some time yet…

        Even if a black swan emerges — the Fed will raise it’s bazooka and blow it to bits..

        Of course the axiom that what cannot continue will not continue is always true…. but someone else here has another axiom — something to the effect — it can go on a lot longer than you expect…

        Also true

        • Siobhan says:

          “Of course the axiom that what cannot continue will not continue is always true…. but someone else here has another axiom — something to the effect — it can go on a lot longer than you expect…

          Also true”

          hattip to Interguru’s Lemmas™

        • ravinathan says:

          Good point Paul about not fighting the Federal Reserve. I misjudged the Fed’s determination to do whatever it takes to preserve BAU and underestimated the financial system’s response of buying up financial assets with the flood of fed provided liquidity. Corporations have successfully increased EPS by substituting cheap debt for equity which has fueled the rise in equity prices. For the party to continue, debt has to remain cheap with extended low interest rates or the cost of debt servicing can become overwhelming in the context of ever increasing leverage. In a speech, former Fed chairman Bernanke said the he did not see interest rates reverting to normal in his lifetime, a telling statement.
          So what can upend this apple cart? Once again quoting Bernanke the Fed cannot control oil prices. Nor can it increase agricultural productivity or forestall the devastation of climate change induced catastrophes.

          • Paul says:

            When I look at those GDP numbers out of the US — I wonder if that continues if it will upset the apple cart…

            Up until now the Fed’s tricks have supposedly kept GDP positive — of course this growth has been a result of stimulus only — but better than nothing (I would argue that all growth for decades has been debt fueled)

            But are we not getting to the pushing on a string phase? How does the Fed get that number back on the right side of 0? They have thrown the kitchen sink at this…

            If this continues the next phase could get very dangerous — what are the final weapons in the arsenal — they could seize pension funds and other assets (they’d not call it that of course) — but that would only hasten the collapse as growth would get absolutely crushed by such actions.

            I wonder if Gails ‘within 2 years’ prediction is going to come through — half way through 2014 and the tremors are starting…

            • John Doyle says:

              Paul, Gail and everyone: This video, mentioned above in an earlier post, really is a MUST SEE!!!

              I’ve yet to see our future so realistically explained. It starts with minerals but goes on through finance etc
              Watch it all the way through!

            • Paul says:

              I must have missed that – can you resubmit – thanks

            • Thanks! That talk is good. Someone posted a link a while back, but new commenters may not have seen it.

            • Paul says:

              Yes – I have seen this previously — it is excellent

            • Jan Steinman says:

              “That talk is good.”


              Simon Michaux has the sort of cred that Gail has — an insider, pointing out that the emperor has no clothes.

              Michaux manages to connect many dots that others miss. For one, his cluster plot of for oil prices clearly shows when oil pricing went from demand-driven to supply-driven, which could be another definition of “peak oil.”

            • Paul says:

              The glass rod metaphor is also outstanding … I believe if we had not pursued the so-called green revolution (considering it involved pouring oil by products onto our farmland that really is the worst use of the word green in history) in the 60’s we would not be facing a catastrophic situation. Because of that event population has continued to expand — to the point where now when the food supply gets hammered — the rod is going to shatter into a million pieces.

            • John Doyle says:

              I have to say I’ve no idea how this reply system works. It’s nowhere near the original blog to which this is the answer and trolling hundreds of replies is very time consuming!!!
              That said I suggest another you tube video, which is similar to the earlier one;
              This 50 minute presentation explains most of the predicament we are in very cogently.
              However Chris Martenson, Adam Taggart are far too sanguine about the slide we face.
              They don’t factor in the inertia built into us, resistant to change, particularly in such a fundamental way.

            • Paul says:

              Martenson believes thorium might be the saviour — he also believes most of the hype about shale — and he sells prepper products on his site.

              Enough said.

            • John Doyle says:

              Just ignore the last bit of the video. I don’t agree with that either which I think I said, except I can’t locate it now herein

  18. ordinaryjoe says:

    Thank you again for the post Gail. The length of the stagflation vs collapse will be interesting,
    Looks like Libya is coming back on line. Lots of grease in the form of payments to groups of people required to keep that cog spinning. Previously when Libya went off line their was lots of supply shortages particularily diesel for Europe. Basicly Libya has been offline for a year


    In 2011 when Libya went off line their was lots of supply shortages particularily diesel for Europe. This last year Libya has been offline but their dont seem to be shortages. Is this because of lack of demand from the “recovering” global economy, under reporting or were the shortages in 2011 exaggerated? It would seem to me that if demand is so low that Libya can go offline multiple times for long periods without the global economy hiccuping we are clearly in deflationary times?


    • The world economy is not doing all that well. The IMF keeps cutting economic growth forecasts. For example, http://www.forbes.com/sites/kenrapoza/2014/04/08/imf-cuts-world-growth-forecast-as-emerging-markets-sputter/

      It is China that is not growing all that quickly now–also Brazil. I am not sure how good the numbers we have are.

      No one wants to let the world know that they are not doing all that well.

      • Stilgar Wilcox says:

        “No one wants to let the world know that they are not doing all that well.”

        That’s because confidence in the system to take out loans and keep BAU going is crucial for growth, even if that means supplying falsified numbers to cajole people into having faith, when in reality they should be more wary of over extending themselves.

      • Robin says:

        Really? I’m writing this from the centre of the UK’s second-largest city. From my window I see four major developments proceeding nearby (after years of building stagnation). Plus a mechanical carwash that closed in 2010 is now being restored for reopening, they are even resealing its roof, investing in a future real or otherwise. The airport has more and more intercontinental flights and is being expanded and so is the hi-tech metro. The city council is doing a massive investment in energy efficiency for 200 housing blocks, installing new heating systems to replace the off-peak storage heating systems. The canals that started the world’s industrial/transport revolution are chugging with loads of “traditional” leisure narrowboats. There are calls to add a HS3 to the currently-planned HS2 highspeed railline.
        Predictions that the EU or the euro were going to collapse haven’t come true yet and don’t look anywhere in prospect. The only things that are looking gloomy round here are the prospective new mosques, four out of four of which have ended up stillborn for reasons which might have to do with tighetning belts in some hotter countries dependent on their oil exports. Collapse has never seemed more distant in this picture. Why?

        • I am not sure. There is a lot of variability in outcomes. The low interest loans are going somewhere. I presume they are going for the kinds of things you are talking about. Right now the big stresses are from oil prices being too low for oil producers and oil exporters. For oil producers, that impact has a while to work through the system. For oil producers, the effect can be expected to be additional discord in the Middle East–something we already have.

          The fact that things are going relatively well now is what is giving the IMF and BIS confidence that it would be OK to somehow “fix” the system, perhaps with higher interest rates. Their “fix” may very well be what puts the system under.

          • Robin says:

            So 2014 could still be the year of the great crackup? Trying to guess the when and how is most intellectually intriguing. Perhaps when the bankers misjudge and put a foot wrong in some way? The ISIS crisis maybe? But I suspect the Washington people are wisely resisting the temptation to go bombing and thereby anoint ISIS as the defenders against the Great Satan? And how long can ISIS keep a refinery working without international technical cooperation?

            • One particular issue I am concerned about now is that the bankers are starting to see that the QE and ultra-low interest rates can’t continue forever. This approach is blowing bubbles. Consumers are not too concerned right now–with rising stock markets, and everything looking pretty good, the time is right to try some new approach. The Bank for International Settlements released a report a week ago, saying that the system needs to be “normalized”. This is the speech given by the BIS General Manager.

              The International Monetary Fund is also pushing to change the current system, back to more normal interest rates, while Janet Yellen of the US Federal Reserve is pushing back. The Washington Post reported, First ladies of finance Yellen and Lagarde are set to face off on economic policy. What they said is recorded here.

              The IMF has in the past been a proponent of using its Special Drawing Rights as a world currency. IMF Calls for Dollar Alternative, so that there would be something like a world currency.

              One thing that seems bizarre is that Christine Lagarde (managing director of the IMF) appears to have used numerology to send a coded message, suggesting some sort of change might be in the offing, on July 20, 2014.

              Our economic system is fragile as it is. I doubt these folks really understand how deeply the need for cheap energy is imbedded into our problems. Having a bunch of folks trying to fix the system without understanding that the problem is not a monetary system problem is a recipe for disaster. Any rise in interest rates will bring economic growth way down, and lead to debt defaults, job layoffs, and many other undesired effects.

            • Robin says:

              Thanks Gail for such an informative reply. I’ve had to stop Yellen’s speech to check out “macroprudential” and then “procyclical”. But meanwhile I note that that BIS speech makes no mention of resource constraints or limits to growth and instead does say:
              “The good news is that the global economy is healing and global growth has picked up during the past year.”
              Which raises the question of do they actually believe this rubbish they are talking? These are top people after all. As I’ve said before, I reckon these people have a fixed delusion that the “boss” subjects (econ and pol) control the “servant” subjects (mere physics, chem, biol, geog) and never the other way round.

            • Crazy situation, isn’t it?

  19. edpell says:

    Gail, made the point I was going to make we are in the “band-aid” phase. I see governments here in cold, cloudy New York loosing tax base so they create new taxes and raise tax rates. A death spiral. I for my self am moving to warmer North Carolina. I see the start of the crisis at about 2022. I think here in the US we will continue to try to adapt with higher mpg cars, heat pumps rather than oil heat, less driving, car pools(!!!), moving south, etc. until then.

    Of course it depend where in the world one lives. Yemen, Egypt, Ukraine, Greece, Italy, Spain, Ireland and many others are already in crisis.

    • edpell says:

      Gail made the point in the above video that I was going to make we are in the “band-aid” phase.

    • ordinaryjoe says:

      Congratulations Ed the Carolinas are great!

      • InAlaska says:

        Move north, my friends. There are far less people, and you can still grow food here, or hunt it.

      • InAlaska says:

        If you’re moving to the Carolinas then you should read “One Second After,” by Forsythe. It’ll make you think.

    • we cannot continue to be supported by a society convinced that its prime function is to shift stuff from A to B, while calling it employment

      • edpell says:

        I do not quite follow your wording but I do agree we could cut about 50% of all jobs and be no worse off. That is not an across the board cut but a cut of superfluous and marginal jobs.

        • The people who get their pay from those jobs might think differently.

          When I visited India, I was surprised at the number of make-work jobs there were. Trying to board a plane in India required numerous steps that are not required elsewhere–having one’s documents checked before you even after you entered the airport, filling one’s name in a big book, going through more than one kind of security, getting a special tag and stamp on that tag for my purse, etc. People feel like they have earned money when they have a job, no matter how unnecessary. Recipients and governments don’t like hand outs.

          • I agree on the theory of job making, but reduced to basics, employment is the conversion of one energy form to another. You hunt an animal, kill it, and absorb its body mass into yours and that of offspring dependent on you. That is the bottom line of employment.
            Updating to now, a farmer converts seed into a harvest we can use to give ourselves fuel/energy. All the paperwork and formfilling related to agricultural production is in fact dependent on the profit derived from the harvest itself. Passing bits of paper hand to hand doesnt contribute to the volume of energy produced, it depends on it and justifies the existence of the bureaucrats who insist that their jobs are necessary.
            Every job, trash collector or brain surgeon, depends on someone, somewhere back down the line producing an excess of food for use.
            If you doubt that, put both of them on a desert island and they both become hunter gatherers overnight.
            We all depend on the prime energy producers, calling coloured bits of paper money is to add to the ultimate delusion that we are creating prosperity.
            The same applies to transport. Almost every theory about our ‘downsized future’ somehow manages to include wheels.
            Wheels equate with delivering prosperity, rather than the reality of it, which is infinite consumption of diminishing energy resources. If only our wheels can continue turning, then all will be well because we look at our crowded roads and see shiny cars and trucks delivering everything that makes society tick.
            Thus moving stuff = prosperity

            • I think you are pretty much right. A person wonders what kinds of roads all of those moving wheels will move on. Roads are in some ways harder to keep up than cars, especially if the volume of traffic decreases, but the freezing/thawing doesn’t. The drivers have to pay for the roads, no matter how few there are.

            • Paul says:

              Well put — all the complexity boils down to one thing — the availability of (cheap) energy.

    • Living in the Atlanta area, we didn’t see a point to moving North. Even here, we use quite a bit more heat for homes than cooling. It would be almost possible to get along without either heat or cooling, especially in “good” winters.

      People in Mediterranean climates have it milder than we do. We tried to grow an olive tree, but it froze last winter.

      • edpell says:

        North Carolina to Georgia may still have winters but at 30 degrees heat pumps are ideal. At 0 degrees a heat pump does not have nearly as much gain. Then there is insulation it looks like it is not a major feature of most houses. We hope to eventually build from scratch. It will be zero net energy. Yes, when my inverter dies we are back to nature. When it becomes clear the end is nigh I will buy and store a second inverter. As PV panels fail I can bypass them. With a little luck my wife and I will die before the PV/heat pump. The kids/grand kids will have to make due.

        • ordinaryjoe says:

          Heat pumps are problematic. Batteries for PV are problematic. I have background in this. Lower your sights. Thermal mass and superinsulation is the key. Passive solar to heat it in the winter convection to cool it in the summer nights. Forget about the high tech, low tech low tech low tech. Abandon your thoughts of maintaining high tech. Smaller is better. Build it as a shed or garage to comply with code. Realize a ‘house” is a financial instrument dont try to create a financial instrument- build a home. Seek knowledge sources who have done it. Dont reinvent the wheel. Your grandkids dont have to “make due” and neither do you. low tech low tech low tech. best wishes.

          • I think you are right on the low-tech. The Passiv-Hauses are going to have problems as soon as a window breaks and it can’t be replaced.

            Also expect to move. Don’t invest a huge amount in one place, if you are going to have to pick up and leave it. You may not actually have to move, but don’t be surprised if something goes wrong, and Plan B is necessary.

          • kesar says:

            Agree. Do you know any good sources for low tech home design? I am preparing a special project and really couldn’t find anything interesting.
            Windows issue – threre are some solutions – special anti-burglary construction (p3-p4 certification) or foil covering. Not perfect, better than nothing though.

            • ordinaryjoe says:

              Straw bale, cob, adobe, earthship, earthbag, cordwood, papercrete, aer block. I like earthships. It doesnt really matter. What matters is what materials are available locally. What matters is find somone who has done it locally. Buy them lunch pick their mind. Delicately oh so delicately ask them about the problems. ally with them. Ally with the people that have built five have built ten. What matters is community. Only after establishing allyies with experience indulge your creativity. Will your building authority work with you? You must ally with them also . Go talk to them feel the water, involve them , they need that. Either bring them in right from the start or exclude them 100% and go bootleg. Both have advantages but generally its hard to be comfortable in a bootleg home so involving them is by far the best practice. Realize the building authorities primary function is to regulate and get their cut on the financial instrument known as a house. A garage is less of a financial instrument. You like to spend a lot of time in your “shop” no law against that.

              If there is no community – no allies- you are building in the wrong place!

              If there is no community – no allies- you are building in the wrong place!

              If there is no community – no allies- you are building in the wrong place!

            • Look around at old construction in your area. What did folks do, before modern materials we available? I am sure it wouldn’t meet building code, but it gives an idea of what we are up against. Visiting museums can sometimes shed some light on this. We all know about log houses. There were also sod houses.

            • kesar says:

              Good suggestions, especially concerning the community. My problem though is lack of people with the same understanding of LTG issues here. If you look at the map on Transition Network website, my country is empty. I have some other restrictions to be taken into consideration: distance from family, kids, healthcare (at least for the nearest future), culture, etc. Not everyone (so called Wife Acceptance Factor) wants to move to Alaska/Bali/etc.
              Technology – I have chosen the earth-shelter construction. It has many pros and cons are rather manageable. I have different approach to “locality” issues. I will use the best technology available to assure 70-100 years utilization time for the house – at least for the construction/non-maintenance parts of the building. The big challange is the installations: water, lighting, cooking – everything what modern way of life requires (at least for BAU time). So I thought of redundancy here – usual infrastructure for BAU period until the SHTF and low-tech/XIX century like solutions for the future. And this is what I am looking for.

              I am looking for the inspiration everywhere, but the old way of building was not very efficient in my opinion. I studied a lot of it. Low insulation standards=lot of wood to heat, very archaic internal communication patterns, unhealthy environment, low durability materials and many more issues. It is the time to fully utilize the modern technology to build something that will last for generations and serve them. It won’t hurt the climate as we all know it – it’s too little, too late. Someone has to carry this torch of light in the future. At least I hope.
              I see here this paradox – we know that civilization is on the edge of collapse and we are aware that the technology and progress brought us here. On the other hand I am aware that if we were smart enough we would build wisely long time ago. We could have a few decades more. Building something that will last 20-30 years before rebuilding/modernisation/refurbishment doesn’t make sense even from EROEI/sustainability point of view.

            • Paul says:

              I am not clear why some are advocating old style buildings…

              Why not build something simple and durable that utilizes modern methods and technologies — plus something low maintenance?

              I’d go with stone and concrete — metal roof — and I would insulate the hell out of a place — I would install a high efficiency wood stove and probably a wood cooking stove.

              Keeping warm will be the biggest challenge so building a place that is easy to keep warm — and durability — would be my priorities.

            • Our problem is that we don’t know what to build, where. We probably right now have too many homes and apartments already built, if we all are poorer. Families will need to move in together.

              To the extent we need to build, it will be to replace rural housing that has been torn down that will be near land that can be used for agriculture. I am not sure what we will be able to afford. Electricity to the new homes? Water to the new homes–more likely “catch it yourself” systems. Humanure recycling? These ideas may not appeal to the general population right now.

            • kesar says:

              Paul, exactly my way of thinking.

            • ordinaryjoe says:

              A couple years ago I was talking to the building inspector. Out of the blue he tells me ” you know up over that ridge, there must be six bootleg houses, I dont give a rats ass as long as they dont ask me to call it a house”. Now thats one man. People retire. Policies change. With satelite imagery dont for a second think you can hide a structure regardless of its design. They know how many tomato plants you put in this year.

            • ordinaryjoe says:

              “My problem though is lack of people with the same understanding of LTG issues here. If you look at the map on Transition Network website, my country is empty. I have some other restrictions to be taken into consideration: distance from family, kids, healthcare”

              no allys/ Build a shed. Pour a slab the dimemsions of a shipping container put the long axis on optimum sun exposure. Put a shipping container on it. Steel shipping container guess what you just forgot about all load calculations. Anchor it to the slab guess what it aint going anywhere. Now you have a nice solar oven. Get the inspection for your “shed” now. slab is optional but you got to get it off the ground and get the bottom airspace real tight

              now you get down to business. Cut squares in it near the floor. Mount polycarbonate sheet on the inside. build plywood boxes to hold aggregate up against the poly carbonate. Fill them with big round aggregate 3″ if you can get it. Thats your thermal mass. Enclosure fans and duct that you can choose tho circulate heat inside to out outside to in and circulate. Dont cover all the windows with rock. Mount plywood on the outside covering your polycarb with bolts or hinges. Those are your shutters. Have a contractor Shoot the exterior with eurethane foam. Paint it the very next day with Elastomer roof coating- sun eats eurethane. No contractor- Got perlite source vermiculite use insulating concrete- straw bales and poly sheet- your hosed if your bales get wet. Now stucco it. More elastomer roof coating. Dont let them tell you it wont take a tint it will. The eurethane is nice because you create insulated panels when you shoot the plywood. when its cold the rock soaks the heat in the day. shuttered at night. Your windows are for growing plants for good air..

              Or just bury it. Go down to the building department ask them what they think. They will want plans and a engineers stamp. Sigh and look unhappy they love that. draw the plans and find a engineer down a back ally to stamp it for a couple Bills. Elastomer paint and poly sheet over the container before burying. find a backhoe dig a hole level no slab get it off the ground with poured concrete blocks. access to the bottom is nice. Drainage drainage drainage. . Dont bury the solar side all the way. Now you forget about the rock your windows go on the top of the solar side wall . remember this is a storage shed! Why underground? you like fine wine it must be maintained at temperature to keep its value -whatever-thats your story stick to it. They dont care anyway all they will want is that engineers stamp and to add the value to your property for taxation. Shake n bake earthship ala ordinaryjoe. guess what its not a original recipe.

              Call it the love shack. Stock it with a boom box condoms and spermicide and let the kids have it. You and your wife can sneak out to it on tuesdays and fridays.

              What are you waiting for elvises reincarnation?

            • kesar says:

              Thanks for all inspirations. Some of them will be quite useful for me. Nevertheless my idea is quite different conceptually. I hope I can share it with you soon enough and I count on more opinions and comments.

          • tagio says:

            “Build it as a shed or garage to comply with code.”

            Brilliant advice to end run the bureaucracy until it doesn’t matter anymore or can’t do anything about it.

            When you say “thermal mass,” are you talking about cob or other form of earth houses? What are some examples of what you are referring to?

            • ordinaryjoe says:

              Rock- Rocks picked up from the ground and held together with chicken wire works well for heat transfer via convection. – aggregate- formed or shaped various means. straw bale, cob, adobe, earthship, earthbag, cordwood, papercrete, aer block

      • Jan Steinman says:

        Just 1.5 km from here, a fellow has put in fifteen acres of olives… in Canada!

        The models I’ve seen indicate our Mediterranean climate will have much less change than continental climates. Hope they’re right!

        • You are next to the ocean–we are not. This olive was supposed to be hardy down to 15 degrees F (-9 celcius), but it got down to 8 degrees (-13) more than once. We tried to cover it up, at least the first few times.

          Even supposedly warm areas of the United States can get quite cold.

      • InAlaska says:

        And as the climate becomes more unstable, all of those weather norms will go away and even plants that used to do well in any given clime will be in jeopardy of heat stress or cold stress or drought stress or water stress. Probably the best strategy is to pick a place that you like, maybe close to family or friends, and do your best.

  20. Stilgar Wilcox says:

    Gail, if I read your post correctly, you are saying the idea many have that on this path of diminishing returns we will simply get by with less is inaccurate due to interconnectedness of the system, analogous to the colored sticks with a hollow area below. Once the overall system degrades to a certain threshold it collapses. I agree, and find it interesting that many top end peakists seem to convey a similar message, except many of them suggest transitions that will take place locally.

    Chris Martenson just recently did a new synopsis of our energy predicament that is on peak oil dot com. It’s quite good, except towards the end he launches into a routine of this is not a message of doom and gloom. That we can make the transition locally by connecting with others, growing vegetables and installing solar. My rebuttal was that we rely on so many things that are trucked in that any kind of transition like that will have many difficulties. For example what happens when the battery back up to the solar panels no longer holds a sufficient charge for night time usage. Are there replacements locally or maybe we then rely on candles? What happens when someone gets a strep infection? Where do they go locally to get the antibiotics. Will this post collapse localized economy have a dentist? Will solar panels produce the electricity for his drills and bright lights? Where will he send out casts of teeth to get crowns made? It doesn’t take long to realize it gets super hard, very fast, post collapse.

    I know you are aware of these shortcomings, but I think many people have myopic vision and maybe romantic ideas of living locally after having been part of a globalized networked society that trucked in so many different products. So I think your post is an apt one and thank you for being one of the only peakist bloggers left to realistically view what will actually happen.

    • ordinaryjoe says:

      “I know you are aware of these shortcomings, but I think many people have myopic vision and maybe romantic ideas of living locally after having been part of a globalized networked society that trucked in so many different products. ”
      The one thing we know is no one knows what lies ahead. I feel gifted that I have a small understanding of our situation and yes we should act upon it using our spirit as a guide but the gift should not be allowed to steal our life from us. We have today (maybe) beyond that no one knows.
      One of the qualities of a human is we can analyze the past , and anticipate the future but our life occurs in the present.

      • Stilgar Wilcox says:

        Oh believe me I live in the present. Got work to do, bills to pay and we go places and do things. Even have a cruise around Italy planned a few years from now if BAU is still in place. So no doubt we all need to live for now – that’s a given. I just get tired of “The Titanic will sink but everybody will do just fine” type scenarios. Even Martenson says money and debt creation in the US has been on an almost perfect exponential upward trend against a backdrop of diminishing net energy returns, which he admits is unsustainable. And if it isn’t then that spells a lot of trouble for a lot of folks.

        Right now somewhere is a huge building churning out 250,000 loaves of bread a day then get trucked via diesel engine trucks to market daily, or process 500,000 gallons of milk a day. Those are only two products in stores, but you can see what lots of oil (energy) allows us to do – to produce enough food for hundreds of millions in the US and 7 billion worldwide. Now try to do that once the interconnected network Gail is talking about collapses. How do you have localized farming in the Los Angeles basin sufficient to feed 25 million people? See, it starts to boggle the mind how all these people continue to prosper. So I’m not deluding myself that an unsustainable trend will turn out just fine for everybody.

        • ordinaryjoe says:

          Agree 100% with your assessment. And Im sure you live for today. In many ways my posts reflect my coping strategy as it develops. The future looks bleak but today the sun shines the summer is good. It is good that those who accept a finite planet enjoy their life.

          • Stilgar Wilcox says:

            “In many ways my posts reflect my coping strategy as it develops.”

            Yeah, I see your point there too ordinaryjoe. Best of luck in all endeavors day to day and as things develop. Just human nature to do the best we can. I personally get caught up in trying to find ways for us to last longer after collapse via food supply, seeds, and planning to get solar, etc. even if intellectually I am not sure how much time it will buy at our age. In any case, certainly we will all see the power of the instinct to survive on full display when shtf.

            • ordinaryjoe says:

              You can only do your best .Sad things hit me like a ton of bricks sometimes other times I cope better. Sometimes something is coming. The outcome is uncertain. You get a feeling its not pleasant but after a while you get used to it, it still affects you. You cant suppress it that will tear you up, you have to feel it. Most suppress or avoid rather than risk having it carry them away, in the end it carrys them away anyway and their actions dont follow their heart.
              I advocate enjoying the simple tasks of life on general principle. However if hard times come there will be much more uncertainty than we are used to.
              Enjoying life, humour, these are valuable skills. Stress is capable of destroying both your mind and body. Some cope better Im not that good. There is no easy answer and if it goes on long enough most fall. Prescription antacids are not a bad thing to have around. Enjoying the simple tasks of life is also a useful tool. If you follow your spirit, let your heart guide you have no regrets, it helps. If your actions dont follow your heart the questions it raises will get you . Sometimes circumstances dont allow you to follow your heart. Thats a problem, a dilemma, one I really wish I had a answer for. I dont know whats coming. I will do my best to balance my heart and circumstances. Thats all any of us can do really. Today I have the summer and the sun, it is good.

        • Paul says:

          In the run up to 2008 I realized something was very wrong — but was unsure the nature of the beast… but I had a gut feeling ‘normal’ would be over soon… I’ve lived for the day for 6 years now — my bucket list has accelerated with only time and cash limiting me…

          Lack of concern and planning for the future can be perceived as freedom.

          Vive in Diem…

          • edpell says:

            Paul, do you have kids?

            • Paul says:

              We have no kids – we sponsor two kids who live with us and attend international school in Bali.

              Under no circumstances would we be so selfish as to bring kids into this nightmare that is coming (of course others do plan kids but they have no idea what they are setting them up for…)

              As a friend of mine who also has not kids says when people pressure him and his wife — there are already enough people in the world.

    • ASPO-USA always wanted a “nice” message to give out. Publishers want to publish books with “happy endings.” It is also fairly complicated to understand what is really happening. So if a person doesn’t really know, the tendency is to say, “Everything will be close to OK.”

      I submitted this story to Resilience–we will see if it gets published. (They have been pretty good about putting my things up recently.) They are part of the Post Carbon Institute, another group that would like to put out a cheerful message. Financial Sense has it up as one of their featured articles. I haven’t figured out about how to contact ZeroHedge–I suppose they will put it up.

      I suspect at least one of the issues is that it is easier to get funding if a person forecasts a happy ending. Sellers of solar powers like to sponsor such organizations. The big market for a lot of these articles is people interested in “preparedness.” The story needs to be, “Preparedness will be extremely successful. This is what you need to do.”

      I can’t see any point in writing posts that aren’t right.

      • Harry says:

        “I can’t see any point in writing posts that aren’t right.” And I for one am enormously grateful that for this, Gail. If the diagnosis is bad then you want an informed doctor who can tell it to you plain; I do, at least. And it is so easy to get lulled back to sleep by the rhythms of day-to-day life. I have two small kids so I need to keep some focus on what is coming down the pipe. These articles help me achieve that.

      • Ilian says:

        here’s some recent facts. IEA projects that oil consumption will increase by 2 million of barrels for the second half of 2014, http://omrpublic.iea.org
        The question is where will these extra 2 mil. come from? There is few countries only that still have increase in oil production, and the others are flat or declining. If they do come from nowhere, we will have oil shortage yet this year. And if they handle the situation for this year, the next one there will be still another 2 million + barrels needed to support the growing economy.

        • You are right that we are already bumping up against oil supply limits. We can hope Libya’s oil production will come back on line. Otherwise, we can expect more downgrades on economic growth, unless some miracle comes along. Maybe Iran has a bit to add to the marketplace. I don’t know whether price will go up. If price does go up, then it will push countries that use the larger percentages of oil into recession. We will see more debt defaults as well.

          • Ilian says:

            Iran, Libya or even Saudi Arabia can only give temporary relief to hold on the situation this year. In my opinion it is quite possible we get $120-130 price till the end of the year (still not fatal). After that we will get 2008 situation repeated. 6 years ago US handled the situation by fracking, quite doubtful now they will come up with something new. Indeed the financial system seems the weakest part of the whole system. In my opinion the capitalistic system is the one that has to be replaced, but nobody will even think about it.
            Capitalism can not exist without continious growth which is impossible in finite world.

      • Timothy says:

        Gail, the sad and unavoidable fact is that billions of people are not going to make it through the energy bottleneck. Just because the ending isn’t all sunshine and rainbows, doesn’t mean there aren’t important things some people can do now to make their lives easier in the future.

        Sure, most of the population doesn’t actually own their homes, or have arable land, but for those that do, it’s time to get to work planting a food forest, integrating livestock and water harvesting and recycling systems (grey water). Biodigesters for cooking or possibly limited heating.

        With the materials we have available at the moment, we can do quite a bit to prepare for the future that awaits us, that is of course assuming nuclear armageddon does not occur. It’s time for the human race to grow up and stop shying away from the cold truth. The truth doesn’t go away just because you choose not to listen.

        Not that you have a problem with this Gail, I am more commenting on the Publishers views. But of course they are not in business as much to spread the truth, but rather to collect the profits.

        • I have a fairly big garden myself, and have planted fruit and nut trees. I have done a little in other areas too–solar reflective cooker for example. But I can see that what I am doing is not enough to be more than a supplement to food from other sources–and other humans and animals will want to need food as well. I can’t count on eating all I grow.

        • InAlaska says:

          It sounds nice, but all of that preparation that you do will just be taken from you in the first year of the starvation. All individual efforts will be swamped by the massive needs of millions of starving people. Sorry.

      • NB: I’ve found ZeroHedge _very_ iffy of late, if not just plain noncredible. I don’t think I’d push too hard to get published there, it’s a negative reputation score.

        Your Christian Science Monitor and similar posts are rather more worthwhile.

        • Christian Science Monitor seems to like post that sell to a broad audience–don’t scare anyone too much.

          They are also very picky about making sure that all images are ones you yourself made. I usually do that. They object to using anything from elsewhere.

    • Paul says:

      Chris Martenson is living in a fairly land… I hear he is writing a new version of koombaya — apparently he is planing to give away a free download for every prepper pack he sells on his site.

      I am not sure why he gets so much airtime — he is not a serious commentator in this space — at best he is naive — at worst he is an opportunist exploiting the desire of people to survive by selling them stuff…

      Of course people love a happy ending… so he has his following of people who have not thought things through — or are incapable of doing so.

      I love a happy ending as much as the next person — but there isn’t one in this movie.

    • InAlaska says:

      Chris M. is really smart and his message is pretty good too, but unfortunately his business model is based on selling at least a modicum of hope to people who can afford to buy his “insider” service. He knows that the hope is false.

  21. Pingback: Why Standard Economic Models Don't Work--Our Ec...

  22. Standard economic models work if one is willing to accept various degrees of deprivation up to and including starvation as market mechanisms. I am not familiar with a legitimate model that claims that infinite growth is possible. Market mechanism have obviously lowered the consumption of oil. In my opinion publications such as the Financial Times (quoted above) are not always using standard models. Supply demand curves work in both directions.

    • Legitimate models, simply because they assume the same pattern can hold indefinitely, are equivalent to ones that assume continuing economic growth indefinitely.

      Perhaps part of the problem is the assumption that the economy can continue as before, with less demand for oil. If you are willing to put collapsing economy as an acceptable outcome, then supply/demand models work OK.

    • ours is the only period in history where starvation (in tandem with disease) has not been allowed to be a market mechanism.
      We make great efforts (quite rightly of course) from the breadbasket of the American continent, to feed starving millions in Somalia or wherever, but having ‘done the right thing’ we cannot escape the bitter truth that every fed mouth is likely to produce many more in a generation, until we reach the point not many years from now, when the mouths cannot be fed, no matter what the humanitarian need. Already, most of the so called rich nations pledge aid to the poorest, but that’s are far as they go—pledges. Are we seeing a resurgence of indifference? Hard to tell yet. But in the Irish Famine of the 1840s, Ireland was exporting food for profit, exactly the same as is happening in Africa where millions go hungry in food exporting regions now.
      As the poorest strata in the USA get hungrier–will food exports go on in the name of profit. We must wait and see.

      • We have also kept a lot of handicapped people alive who in past generations would not have lived, in our quest to stop Natural Selection. This adds to our food problems as well.

        • Paul says:

          Since we are into the realm of taboo and offending political correctness… let’s add AIDS drugs…

          No doubt many who contract AIDS did — and will continue — to engage in promiscuous behaviour — so are we not exponential increasing the number of AIDS case by keeping the infected alive? Are we not setting ourselves up for a massive epidemic (in some places the disease has already reached epidemic proportions)

          • edpell says:

            As the system winds down there are going to be many priority calls.

            drugs (AIDS, chemo, diabetes)
            snap (food stamps)
            social security
            oil companies
            town gov
            state gov
            fed gov
            group homes
            gov pensions
            schizophrenic patient “treatment” billed at 0.75 million per year to the federal gov

            Who gets first dibs and who gets thrown off the wagon?

          • interguru says:

            I suspect the the return of the classic diseases, TB, typhus, measles , etc following the breakdown of our sanitation and public heath systems and the weakening of the population through malnutrition will make aids a sideshow.

            • Mjx says:

              Just read an interesting read concerning Henry Thoreau by Michael Sims and in it many deaths at an “early age” from TB. henry died from it at age 44, along with several family members. His brother, John, died from lockjaw. So, we can expect a upsurge of these again.
              Also, another book concerning Mark Twain, cited that letters written in that age frequently mentioned the passing of family and friends. Death was a frequent visitor and a tiresome one at that.
              We older folks hit the lottery in human history being alive at this day and age…for now.

            • Interguru says:

              It’s slightly off topic, i.e. it does not affect survival rates, but here goes. Several hundred years ago almost all people lived in continuous pain. No pain pills, from aspirin up to the most modern formulations, no anesthesia, no major surgery, no treatments for ailments of aging, no artificial joints, little palliative care at all.

            • Paul says:

              What — no Xanax to take away the mental anguish of not being able to live large? How did they ever cope?????

            • Interguru says:

              A doctor from India was convinced that the modern rash of mental illness was a byproduct of modern civilization. To prove his point he went to a traditional village in Africa. There, to his surprise, he found the same rate of mental illness as in the developed world. It was all undiagnosed. He trained some locals in treating some of the more common illnesses such as depression.

            • Do we really know that people lived in continuous pain? About 20 years ago, I started having pain in many joints simultaneously. My doctor prescribed the usual pain drugs. I did a little reading, and figured out that diet was likely a major cause. I changed my diet to mostly vegetarian (+ fish), very little processed foods, and haven’t had problems since. Forget all of the pain pills. If I were eating the Standard American Diet, I am sure I would be in pain. I also don’t have high blood pressure, high cholesterol, and all of the other standard problems of the American population.

            • Jan Steinman says:

              “Several hundred years ago almost all people lived in continuous pain.”

              Is this well documented? I don’t recall reading things like this. You’d think it would be mentioned frequently.

              I offer two counter-arguments: 1) people were more active; much of our pain is a side-effect of a sedentary life, and 2) herbal pain medications are actually quite good; aspirin was first synthesized from sap from willow trees, from which it gains its name (Salix is the genera for willow, and acetylsalicylic acid is the chemical name for aspirin.)

              Of course, post crash, most westerners will have had sedentary lives, and learned nothing of herbal remedies, so you may be closer to the future than the past in this one.

            • Paul says:

              I also question this as well Jan…. I have not been to a doctor in years other than for a check-up …. I have not taken a sick day from work in over 15 years … I do not ‘live in pain’ — what I try to do is eat healthy (ZERO processed foods) … limit alcohol and calorie intake — and exercise almost every day…

              I believe that if one has a healthy lifestyle one does not necessarily have to live in pain.

              The people living in pain are generally those who have chosen to live unhealthy lifestyles … I can imagine that problems such as diabetes and heart disease will disappear amongst those who survive what is coming…. there will be no super sized colas — 241 pizzas — and there will be no TV to flop down in front of to watch drivel.

              Anyone who survives will instead be working hard on producing food — and eating (if they are lucky) mostly vegetables and fruit — or better known as the Post Cheap Oil Collapse of Civilization Diet (TM)

            • interguru says:

              Life is a lottery. You can load the dice with a good ( or bad ) lifestyle, but it still is a lottery. My friend who is a health fanatic suffers from spinal stenosis leading to constant back pain. It runs in her family.

            • Paul says:

              Yes very true — but I don’t think the future means endless pain and suffering as has been suggested.

              Overall there may actually be less chronic pain and suffering because unhealthy lifestyles — the cause of most health problems these days — will no longer be an option — people will be forced to eat healthy food — and to do labour in the fields…

              Obesity will be a thing of the past…

            • Hunter-Gatherers seemed to be healthier than anyone who came after them. Addition of grains to the diet was not helpful, nor was the limited selection of food people could grow in a stationary environments. Height dropped by up to 6 inches, as humans shifted from hunter-gatherers to an agrarian lifestyle, according to Spencer Wells in Pandora’s Seed: The Unforeseen Cost of Civilization.

            • Jan Steinman says:

              “Hunter-Gatherers seemed to be healthier than anyone who came after them.”

              There is a sustainable middle-path: the pastoral life-style.

              In some cultures, pastoralists thrived for two or three thousand years between hunter-gatherers and agriculturalists. In the modern world, the few pastoralists remaining (Maasai, Sami, some Swiss alpine communities, etc.) seem to be much better off than their agricultural neighbours.

              Pastoralism may be able to return where there are large undeveloped areas, like national parks, etc., when government can no longer control such areas. These places are typically unsuitable for agriculture, but well-suited for grazing dairy ruminants. I’d sign up tomorrow!

            • It is possible that a pastoral life-style would work in some parts of the world. The height comparison was with quite a bit later period, as I recall.

            • interguru says:

              I do not have statistics, but if you read David McCullough’s biography if John Adams
              you can see how much health issues effected one upper class family who lived on a farm and grew their own food two hundred years ago. Fevers kept them abed for months. His daughter became sick and almost died from a smallpox vaccination. His daughter ( maybe the same one?) underwent a mastectomy without anesthesia which ultimately didn’t work — she died of breast cancer.

            • Paul says:

              Fast forward to where in the US 27% of all people are obese — I have never been in that situation but I can imagine there is a lot of suffering and discomfort involved — diabetes is rampant… heart disease … painful joints etc…

              Not to underestimate how difficult it would be to live without modern medical care — but there are a huge number of people living lives of chronic illness and pain even with modern care.

            • Jan Steinman says:

              “you can see how much health issues effected one upper class family”

              The key words being “upper class.”

              They used to call gout “rich man’s disease.” Now anyone can get it! Industrial food and sedentary life-styles are not a modern invention, but it has been a great equalizer of maladies that used to only affect the rich.

          • Quite a few of the infected are wives and children, especially in Africa. How are we going to control the promiscuity of migrant workers in Africa, if they have to be gone for months at a time? Is this up to us to decide?

      • dorji yangka says:

        so you want people to die of starvation right in front of you?
        why can’t we lend help when we can?

        • Paul says:

          1. There are 7.2 billion people on the planet

          2. They are fed using cheap oil and gas based pesticides and fertilizers + the field machines that rely on cheap oil + transportation methods that rely on cheap oil

          3. We are at the end of cheap oil.

          4. Therefore billions will not be fed i.e. they will starve to death — there is no way around this

          Even if one wanted to feed the 7.2 billion people it would be futile — unless you wanted to feed them sand and rocks

          Does anyone want to watch people starve in front of them? Of course not.

          But for those who have anticipated what is to come — and have made preparations — feeding the masses of starving would be akin to trying to fill in the ocean with a shovel.

  23. Readers of this article may be interested in The Money Valve series on the Diner.  In that series I drew out a basic network diargram for the way our economy functions.
    Also, Ugo Bardi brought up network theory in the recent chat we had with Gail at the Collapse Cafe last week.


  24. Rodster says:

    The one thing I took away from Gail’s excellent post is how in order for the economy to continue properly working and the global population fed is thru resource depletion and infinite economic growth. If you break the links it all collapses. The other problem I see is that this time around global civilization is tied to the same economic meme which puts civilization in an even more precarious situation.

    • Yes, you are right.

      (1) To keep up the current networked economy working properly, we need to continue resource depletion and economic growth. If we break the links, the system collapses.
      (2) Globalization changes the situation from previous collapses. Back then, a civilization in one part of the world could collapse, and the renewable resources they were using could recover. Now, the whole world is drawn in. Also, we are dependent on fossil fuels. These can’t be expected to renew in any reasonable time frame. Neither can aquifers.

      • Rodster says:

        Which segue’s into fracking and the enormous amounts of fresh water needed to extract energy from rock. Clean water that is already in short supply.

        • Harry says:

          Fracking is a horrible business – but without the tight-oil revolution, QE and ZIRP, the system would probably have already crashed. As someone who lives in a frackable area I feel deeply conflicted about this!

          • Paul says:

            Same here — at one point I opposed fracking… and tar sands…

            But then realized, if it were not for fracking + tar sands — we would not be talking about the pollution that these prodedures cause — we’d be in a massive shit storm or already dead.

            I suspect these abhorrent extraction technologies are our last line of defense against the onset of a massive unstoppable collapse.

            This is how truly desperate the situation is

            • Unfortunately, I am afraid you are right. We have to keep oil supply going one way or another to put off collapse. Some people don’t care about putting it collapse, but given what it is likely to mean for most of us, I am in favor of delaying it as well. The situation is desperate.

            • Jan Steinman says:

              “given what it is likely to mean for most of us, I am in favor of delaying it as well”

              This is where we differ.

              I say, let there be a fast, hard crash. Yes, people will get hurt. People will die. But people are getting hurt and dying in the slow, ongoing crash we’re having now. The area under the curve is the same, no?

              With a fast, hard crash, there is a hope that survivors will learn to live differently, rather than simply living it up as best they can. People need a wake-up-call, a Pearl Harbour, a Waterloo.

            • Paul says:

              I have a different take — I like the life I have and I want it to go on for as many years as possible — but I am preparing for what comes next…. in spite of the fact that all preparations will likely be futile — and that I will not enjoy a life that has not a single one of the modern conveniences I currently enjoy — that is unlikely to have the security and safety that I take for granted

              I don’t really care if people are preparing or if they ‘get the wake up call’ — as far as I am concerned they can stay glued to facebook and dancing with stars…

              Why should we care that anyone survives this?

              What is so special about mankind that we should be concerned that this species survives?

              If the planet were conscious I am sure it would gladly give every one a last shove over the edge of a cliff.

              There are plenty of species that do no harm to the planet — yet they perish.

              We are a cancer on the planet — if any species deserves to go it is the human race.

            • We don’t know how many survivors there will be. It is a safe bet there will be more dying in a collapse than there are now. I don’t want to test out what really happens.

            • Siobhan says:

              “If the planet were conscious I am sure it would gladly give every one a last shove over the edge of a cliff.”

              Paul, this reminded me of the Sweet Honey in the Rock song, “Battered Earth”
              (not sure if you can play the video or not…I think it is from their “25 Years” cd)

            • Siobhan says:

              Oops! I added the url for the video and the comment box replaced it with embed code–making the video appear twice… I thought it would just hot link the url…sorry about that :(

            • BC says:

              Growth of extraction of shale (doubling time of 5 years) has contributed 100% of the incremental growth of global “oil” extraction since 2008. Without shale, per capita extraction of “oil” would have contracted even more than it has.

              However, at the trend rates of extraction, consumption, reserves, and exports, the US will extract 50% or more of proved reserves by no late than 2017-19, so we’re already falling off the so-called “Seneca cliff”, extracting as quickly as possible the easily accessible reserves of the costlier, lower-quality resource, ensuring that we will have less supply in the future at prices that we can’t afford to burn and grow real final sales per capita.

              That we can’t extract costlier oil substitutes profitably and cheaply enough to grow real final sales per capita, it follows that we can neither afford to build out to anything close to necessary scale “renewables” AND simultaneously maintain the fossil fuel infrastructure.

              But the top 1-10% of households are largely unaffected to date, which permits them to continue to act as if nothing has changed since 2005-08, availing themselves of the 200-350+ “energy slaves” per capita required to sustain their lifestyles and BAU, increasing costs of the system of hierarchical distribution of flows to the top 1-10%, ensuring less per capita for the bottom 90%.

              Yet, we are constantly told that the only solution is “growth” of bank reserves, asset prices, debt, consumption, immigration. and population.

              Mass suicide as preferred policy.

            • Paul says:

              “so we’re already falling off the so-called “Seneca cliff”, extracting as quickly as possible the easily accessible reserves of the costlier, lower-quality resource, ensuring that we will have less supply in the future at prices that we can’t afford to burn and grow real final sales per capita.”

              BC — there will be no supply of oil in the future no matter how quickly and how much we extract now. The reason being is that the complex market mechanisms that allow for the high tech methods that are used to pull oil from the ground will break when the global economy shatters.

              Economic collapse means a deflationary collapse and a supply chain collapse — and an employment collapse — so whatever oil is in the ground will stay in the ground.

              The days of Jed Clampett getting rich off of crude bubbling to the surface are long gone — these are the days of high tech gear – computers – high finance extraction techniques – highly trained engineers and scientists …. none of these will exist going forward.

              We will be in a far worse situation than those in the pre-industrial ear —- because they at least had the lowest hanging fruit available to exploit — and because they had the skills to exist in a world without the things we take for granted.

              This is going to be like tossing a baby into a remote jungle – and expecting her to survive.

          • interguru says:

            For more on water and energy see

            IEEE Spectrum magazine did a special report “Water vs. Energy” where they cover many aspects

      • John C Green Jr says:

        Just a nit …

        “Now, the whole world is drawn in …”

        I consider the global civilization to exclude any village that does not import stuff that arrives in intermodal containers and does not export stuff in intermodal containers.

        Any village in say sub-Saharan Africa, rural China or India, or other remote places like Bhutan is not participating in the globalized civilization and won’t be crushed when it collapses.

        If a village stops producing its traditional diet of locally grown veggies, nuts, seeds, and domestic animals, converts its arable land to a monoculture cash crop e.g. cacao, coffee, palm oil, ships its cash crop to market in intermodal containers, and eats food shipped to the village from far away by intermodal containers has joined the global civilization and will be crushed when it collapses.

        • Harry says:

          Those villages will have to withstand wave after wave of invasions from the suddenly destitute and desperate. Locally grown food and domestic animals will be vulnerable to raids. IMO only self-sufficient and geographically remote hunter-gatherers have any realistic chance of avoiding being drawn in. Papua New Guinea perhaps?

          • Massinissa says:

            Too close to Australia. The Australians could paddle boats there.

          • Paul says:

            I was just in the interior of British Columbia — very few people live there — and most of this regioin would be inaccessible without ferries to cross lakes — or fuel to get across mountains.

            There are of course a lot of trees to supply energy — the people have many of the skills required to survive (hunters, trappers, mechanically minded, tough people with good farming experience in all communities) — and there is a lot of land that could easily be converted to small scale permaculture.

            I suspect an area like this would have a good chance at coming out the other end of this ok.

            • Downside: growing season is short. I know Dmitry Orlov says that in some parts of Russia, harvests are so variable that they have to depend on hunting and trapping to supplement food supply.

            • Paul says:

              It would be tough but doable — I saw a video of a russian woman who had been living in a remote part of siberia for over 60 years — she was on her own as everyone else in the family had died. She was found by prospectors…

              She survived without any community to rely on…. and she was 70+ and still going…

            • InAlaska says:

              Paul, I live just across the Wrangell Mountains from BC, and the same holds true here, the downside being the short growing season. But that is changing quickly. We have a frost free month on either end of summer now that wasn’t here 20 years ago.

        • Even in China and India (I down’t know about Africa), fossil fuel fertilizers are used. (In China, nitrogen fertilizer is made using coal.) Irrigation, or pumped water for drinking, is often used as well. So I don’t think it is actually necessary to have food brought in in containers. There is a fair amount of food that has been shipped to Africa as “aid,” but such aid may simply make it non-economic for local farmers to compete, and create a greater problem in the long run.

          There may indeed be some villages that are far removed from the global economy so they will be unaffected, but I think the number of these has declined in recent years. Of course, as soon as others figure out that there is respite in these out-of-the-way places, they will be inundated with immigrants, so they no longer are self-sufficient.

  25. ravinathan says:

    Gail, your assumption that future emissions are overstated by the IPCC, hence no climate problem, ignores the fact that current levels of CO2 and methane equivalents are sufficient to trigger self reinforcing feedback loops. Further, the newer sources of energy such as oil sands and fracked gas are increasingly dirtier with negative impacts on water, air and soils, a scenario that Holmgren characterized as doomsday “brown tech”.
    Our atmosphere can be also characterized as a network and a sensitive one at that. By focusing on the economy network while assuming the climate network out of the boundary conditions of your mental model will leave you and your readers subject to nasty surprises. The impact of climate volatility through windstorms, floods, drought, wild fires and pestilence can be just as destructive to the infrastructure and other forms of fixed capital as world wars and can serve to either cause or hasten economic collapse.
    In a similar vein, permaculture advocates assume a stable climate that will continue to operate within historical bounds that plants and animals have adapted to. Climate volatility can move the Eco system out of such evolutionary boundaries in time periods that are insufficient for most current organisms, (certainly top predator mankind with a 7 B plus population) to survive in. In fact the sixth great extinction is already well underway.

    • I don’t think I said there was no climate problem. I said their model is wrong.

      The sixth great extinction seems to have started back when man was a hunter-gatherer, with a tiny fraction of today’s population, and only burning biomass for energy. When one realizes this, trying to fix the sixth mass extinction seems very difficult indeed. Impact = Population x Affluence x Technology is interesting, but basically worthless for fixing our problem, unless one of the items on the right hand side of the equation goes to zero. This is a huge problem.

      Also, see my comment to witsendnj above.

      • Don Stewart says:

        May I suggest that you needlessly antagonize some people when you say that ‘their model is wrong’ when referring to climate change. Models are built with data. The best data on CO2 is from ice cores. But we have no ice cores with CO2 concentrations as high as 400ppm. We can fall back on less precise measurements, which are not nearly as direct as the ice cores. What we find is:

        ‘The last time atmospheric CO2 was at 400 parts per million was during the ancient Pliocene Era, three to five million years ago, and humans didn’t exist.

        Global average temperatures were 3 to 4 degrees C warmer than today (5.4 to 7.2 degrees F).
        Polar temperatures were as much as 10 degrees C warmer than today (18 degrees F).
        The Arctic was ice free.
        Sea level was between five and 40 meters higher (16 to 130 feet) than today.
        Coral reefs suffered mass die-offs.
        And much more: As Robert Monroe notes: “The extreme speed at which carbon dioxide concentrations are increasing is unprecedented. An increase of 10 parts per million might have needed 1,000 years or more to come to pass during ancient climate change events. Now the planet is poised to reach the 1,000 ppm level in only 100 years if emissions trajectories remain at their present level.”

        Quite a number of climate scientists have been trying to read the tea leaves in terms of pale-climate data as opposed to the models you despise. If all fossil fuel emissions stop next month, then the outlooks are quite scary enough for most people. Why would you say that these models are ‘wrong’?

        Of course all models have weaknesses. For example, the differences between the Pliocene and today might make the consequences worse or better. But the fact that oceans were much higher and that forests grew on Ellsmere Island at that time should give us some clues.

        If you want to complain about the last sentence, ‘1000ppm in only 100 years if emissions trajectories remain at their present level’, then you are into a quagmire. There isn’t anything literally wrong with the statement as it stands, there is just the decision to take recent trends as the baseline as opposed to your forecast as the baseline. So the article presents 2 baselines: what will happen at 400ppm if our experience in the Pliocene repeats itself, and how much worse could it be if current trends persist for another century. The author could add a third scenario, which is a rapid return to the Stone Age per your forecasts, but would that be substantially different from the 400ppm Pliocene scenario?

        I think you should drop the accusations that the models are ‘wrong’. If you want to argue that getting back to the Pliocene will take a long time, while Limits to Growth will act much more quickly, then by all means do so. Just don’t throw rocks at good people doing good work.

        Don Stewart

        • There is a saying attributed to George Box, “All models are wrong, some are useful.” All models are simplifications. The question is whether they are useful simplifications.

          Admittedly, the climate scientists have worked hard on putting together the parts of the model they put together. But the model sits squarely in the middle of standard economic theory and the belief that all energy resources in the ground will be extracted if it is technologically possible to do so. This part of the model is clearly wrong.

          I believe the scientist are unnecessarily scaring people. The story they are telling isn’t possible. (Maybe there is another story, that has the same bad ending, that is possible–but they didn’t put such a story together.) We should not be worrying about oceans rising 100 years from now, when we have a lot more pressing issues that no one wants to even think about.

          At one point, there was a view among “Peak Oilers” that government officials grabbed on to climate change as their “cause,” because peak oil was too close, and too much of a problem. They encouraged an exaggerated view of climate change problems, so as to keep interest away from oil problems. The hope was that somehow, fixes for climate change would somehow fix the oil problem as well. Somehow, I still have some of this view regarding the politics of the IPCC reports.

          • Don Stewart says:

            Perhaps the most pressing problem in the world is putting carbon back into the soil. I, for one, that that is a lot more important than saving Wall Street. Food trumps most everything else. The work on climate science has caused some people to look seriously at the issue. Whether a mass of humanity will take advantage of the opportunity remains to be seen.

            With the air full of carbon and the soil depleted of carbon and with limits to growth facing us, we have no hope at all.

            With soil full of carbon and the air sitting at about 350ppm and with limits to growth facing us, we nevertheless have grounds for hope.

            Don Stewart

            • Agreed. Getting carbon back in the soil would be a good idea. That doesn’t seem to be happening quickly at this point.

            • jcgreen00@tampabay.rr.com says:

              Actually a reply to Gail’s reply …
              … Lack of carbon in soil isn’t the biggest problem by far. Lack of NPK (fixed nitrogen, phosphorus, and potassium) is far more important. In the old days they were provided by leaving all plant matter except for the edible food stuffs in the field and spreading manure from the farm animals onto the field. Also used was crop rotation including legumes that fix nitrogen. These days feces is considered to be hazardous waste in industrial feed lots.

        • Paul says:

          Don – I don’t think you can model climate change — as we have seen time and time and time again — the models are wrong.

          It’s like trying to ‘model’ what the next economic crisis is going to look like — or trying to predict what the weather is going be like in Toronto on July 10, 2038 — or what the world is going to look like post SHTF. The most one can do is make an educated guess…

          And what happens when we model climate change and get it wrong? The deniers jump all over these wrong models and scream ‘SEE – YOU ARE WRONG — THEREFORE THERE IS NO CLIMATE CHANGE’

          There are just way too many moving parts — and no precedents — to allow us to predict what will happen — the most we can do is observe with the understanding that the impact of burning carbon is likely to end very badly.

          • Don Stewart says:

            If the CO2 level is currently the same as it was in the Pliocene, I see nothing inherently wrong with assuming that our climate is likely to converge on something similar to the Pliocene.

            But if you grant that simple model as a starting point, there are lots of other interesting questions that equation driven models may help us with:
            1. How fast is the transition likely to occur? For example consider Gail’s statement ‘it’s not a concern for a hundred years, while Limits to Growth is now’. She is using an implicit model which says that climate change will move glacially (joke intended). How does she know that? There is evidence in the record that climate can change very rapidly….in a decade, for example.
            2. If climate has demonstrated the ability to change very quickly, can we figure out what factors or mechanisms likely trigger a rapid change? Do we see evidence of those factors or triggers in our current situation?

            And so on and so forth with at least a hundred other interesting questions. All those questions require the creation and testing of models, many of them with equations.

            Don Stewart

            • I think one of my issues with climate change is that we really can’t fix it. We can try to fix it, by collapsing the economy quicker, but that is about all. And even that, I doubt will make much of a difference.

              The climate has been changing all along. We are somewhat arrogant to think we can make it behave in a particular way, for any length of time. At least part of the problem is that our ability to control what seven billion people collectively do is pretty slim.

            • Don Stewart says:

              You are ignoring soil carbon.

              Don Stewart

            • Paul says:

              Don — the problem is that the models have been proved wrong time after time after time. If one throws enough darts a few will hit the bullseye of course…

              As I have stated this modeling harms the climate change case — when you are wrong so many times you end up being like the person who cried wolf time after time after time — and there was no wolf.

              I will say this — I suspect that all these models are way way way wrong — a climate tipping point is likely much closer than anyone thinks.

            • timl2k11 says:

              Gail – I agree there is little we can do to fix it now. The hour is much too late. However we have released, instantly on geological time scales, enormous quantities of CO2 that it took nature a hundred million years to sequester. It is not arrogant to think that will profoundly affect the climate, it’s common sense. Still, climate change distracts from the real issues of overpopulation and (excessive) overproduction and complexity.

          • Lizzy says:

            I agree, Paul.

          • Climate models do have their uses, reference is here
            They become more problematic the longer the time horizon but also more nuanced as feedback mechanisms are integrated.

            From the perspective of broad-brush they seem pretty good. These are not intended to model weather but climate trend.

            • According to the article, the three sources of confidence with respect to the model are

              1. ” . . . model fundamentals are based on established physical laws, such as conservation of mass, energy and momentum, along with a wealth of observations.”
              2. A second source of confidence comes from the ability of models to simulate important aspects of the current climate.
              3. A third source of confidence comes from the ability of models to reproduce features of past climates and climate changes.

              None of these is relevant to my concerns with the model. Putting together a model that reproduces changes in the past (backcasting) doesn’t really prove anything about how well it will work in the future. It just shows that the model is internally consistent with what has happened recently. Even reproducing current changes, as we continue to use more fossil fuels is no great trick. The first point basically says that the forecast is tied to the amount of fossil fuels used. What I have been saying is the forecast of fossil fuels use is way off. Thus, the predictive ability of the model can be expected to be very low. In fact, the model can be downright misleading.

      • Mjx says:

        Just want to share this article by Dr. Michael Mann regarding “Climate Science:
        1. Climate Scientists are the Real Skeptics
        2. The Science of Climate Change is Based on Many Sources of Data and Many Different Methodologies

        3. The Models Have Proven Accurate

        Mann: The science isn’t based only on a bunch of climate models, we also have a lot of observations. We can test the principles against what we see in the real world.

        Some people claim that climate models can’t be trusted because they haven’t made successful projections. That’s just dead wrong. Climate scientists have a very strong track record of having made predictions like how much cooling we would expect after the eruption of Mount Pinatubo, back in 1991. James Hansen of the NASA Goddard Institute for Space Studies successfully predicted the cooling that would be observed using a climate model. Hansen also successfully predicted two decades of warming in advance, using a climate model back in the 1980s that was quite crude
        4. If Anything, Global Warming is Probably Worse Than Scientists Say
        5. A Scientific Consensus Isn’t Like a Popularity Contest
        6. Climatologists are Beginning to Recognize That They Have to Speak Up

        It is a very good essay and one that should be read in total

    • Jan Steinman says:

      “permaculture advocates assume a stable climate that will continue to operate within historical bounds that plants and animals have adapted to”

      You don’t speak for any of the Permaculture teachers and practitioners that I know.

      • ravinathan says:

        Quite – which only confirms my point about the collective blind spot on assumed climate stability to which I would add the lack of Permie concern about overpopulation. The Permie gurus that I know continue to reproduce merrily.

        • Christian says:

          “The Permie gurus that I know continue to reproduce merrily”. Gail mentioned that once before. May be they should be teached about the maximal enthropy principle which seems to be ruling their hormones

        • Jan Steinman says:

          “The Permie gurus that I know continue to reproduce merrily.”

          The ones I know have no more than two kids.

          Guess we travel in different circles.

          • ravinathan says:

            I note that you make no mention of overpopulation or the hopelessness of Permie solutions in the face of exponential population growth and chaotic climate volatility.

            • Jan Steinman says:

              I really do not understand the hostility toward Permaculturalists.

              I reject the notion that one must be absolutely perfect in order to affect change. We don’t have many Gandhis, Mother Therasas, and Jesus Christs to go around, folks.

              I have no children, and I gladly give those “birthing rights” to some Permaculturalist who feels the need. I’m sure the average family size of Permaculturalists is below the global average family size, which means permies are destined to become overrun and extinct, anyway, right?

              Except that I bet that a far greater percentage of permie families are going to survive the coming hard times. Someone has to carry on those genes, no? If you’re gonna have kids, you might as well have them in a low-energy permie family, no?

              Don’t let “perfect” be the enemy of “good.”

            • palloy says:

              Have you seen http://permaculture.com and in particular http://permaculture.com/node/490 “Busting the ethanol myths” ? I was so shocked when I read that self-serving load of rubbish that I contacted Premaculture in case they wanted to stop Blume Distillation from bringing the name of Permaculture into disrepute. Their response was that they fully supported it !

              Like a lot of good ideas, this one seems to have been taken over by the “we must consider the economic impact too” crowd. That doesn’t stop people from doing things the original way, but it does steal a good label from us.

            • Jan Steinman says:

              Industrial ethanol is quite clearly A Bad Thing. Throwing a bunch of spoiled fruit into a still is quite different, no?

              The author of the “Busting the ethanol myths” clearly doesn’t understand the concept of ERoEI. So I stopped reading when he began defending industrial ethanol and attacking Pimental.

              Who was it that you contacted about this site, and who is “Premaculture?”

              Mollison has trademarked the word “Permaculture.” So he is the one to contact regarding abuse.

              Permaculture is an anarchic movement. It has no designated leaders or more than a cursory structure. You must take a teacher training course with provenance to either of the founders (Mollison or Holmgren) in order to claim to be teaching Permaculture, and then you must follow a rather loose syllabus of 72 hours of instruction and a project.

              This leaves room for lots of interpretation, which I think Mollison and Holmgren are just fine with. You get a few nuts and zealots, but it’s a big tent, with lots of room for exploration.

              I’ve taken the course, and Blume does know about making alcohol. I think alcohol can be one arrow in a small farm’s energy quivver. But clearly, the page you referenced is way out on the fringe.

            • I think it is partly the “big tent” issue that gives people different impressions of Permaculture.

              My impression is that most permaculture practitioners do not talk much about grains. Right now, people get something like a majority of their calories from grains. Figuring out how to get all of those calories, in a way that can stored without continuing energy use, becomes important. Or if there is an assumption that somebody else is supplying the grains, this is important as well.

            • Don Stewart says:

              Dear Gail and Jan
              I think there are a couple of reasons why permaculture people don’t talk much about grains:
              1. They are really cheap to buy in bulk. It makes sense to focus on more costly items such as perishables.
              2. Grains are easily transported because they are dry and have a very high calorie energy to weight ratio. In the event of a crisis, governments would likely give grains a high priority.
              3. Most of the small streams here in the NC Piedmont once had a grain mill every few miles. The Eno river, near me, had a ‘mill a mile’ before the Civil War. The mills are gone and household grain processing sounds daunting. People can imagine stomping grapes and making wine, or have seen cider presses, but the pictures of old-timers dealing with grains by hand just looks hard.

              My perspective on grains has certainly been broadened by reading Dan Barber’s Third Plate: Field Notes on the Future of Food. If you have an interest in grains, I recommend that you pay some attention to his treatment of it. A few points:
              1. The farmers around Penn Yan, New York, are growing organic wheat. They have a mill and a seed company which serve them. Barber says early in the book that wheat provided an organizing principle for rural economies and societies until it was destroyed after WWII. It is not impossible to reconstruct those societies and economies, as the farmers in Penn Yan have done.
              2. Grains work best in rotations, with several types of grains and non-grain crops. In order to make it work, there have to be markets for the crops other than wheat. Yet the US and the world in general have been trending strongly toward the consumption of fewer and fewer species. This country once grew a couple of hundred varieties of wheat, and within a variety the wheat varied by farm and region as farmers saved seeds. Now, for industrial farms, there are really only a couple of varieties of wheat seed. And Monsanto appears poised to take over the wheat market with proprietary seeds. Which is going to make it all much more fragile.
              3. Wheat is now sold to bread companies, who want very specific characteristics. They want a very high protein content, so that they can make a loaf of bread in 20 minutes. The home baker who might take many hours to make bread are not on the radar. To achieve the high protein content, synthetic nitrogen must almost always be supplied to the soil. All of this turns wheat from a ‘soil builder’ into a ‘soil destroyer’. And, arguably, leads to gluten intolerance issues and books like Wheat Belly.
              4. Barber’s kitchen takes delivery of wheat from a farmer in Penn Yan and pairs it with ‘single udder’ butter. Each batch of wheat is ground just before it is used, and the bread baker has learned to adapt to the different characteristics of each batch. Each cow makes different flavored butter depending on what they were eating, how they felt about Life, the Universe, and Everything, and so forth. So, if you go into Barber’s restaurant on Tuesday and get some bread and butter, it won’t be the same if you go back a month later and order the same thing. Good eaters are now used to the notion that heirloom tomatoes are all different and go through a distinct harvest cycle, but few people accept that bread and butter go through similar cycles. Barber quotes a couple of famous bakers who say that the public only accepts consistency in their bread and butter.
              5. Barber has a fascinating chapter on Low Country cuisine. He quotes Glenn Roberts , the owner of Anson Mills in South Carolina. Glenn once organized a ‘southern meal’ for a meeting of a Smithsonian board. Afterwards, one of the Board members sent him a letter telling him that he knew nothing at all about ‘southern cuisine’. Stung, Glenn began to research the subject. The story is that after the initial round of agriculture had worn out the soils of the Low Country, many farmers left for the West, where there was more soil to wear out. But some of the wealthy landowners were left behind, and they had to figure out how to regenerate and preserve the soil’s ability to produce food. There was a boomlet in ‘sustainable agriculture’ societies and publications and studies. Most of the actual work, of course, was done by slaves. One of the features of their solution were small plots of grains grown for household use. Gene Logsden, the Contrary Farmer in Ohio, is a current advocate of small plots of grans.
              6. Barber gives a good account of what the Green Revolution actually did. I won’t cover all the pros and cons, but there is no doubt that it left us highly dependent on fossil fuels and irrigation and has depleted soil carbon (and thus put more carbon into the air).
              7. Glenn Roberts, of Anson Mills, got Barber and the crew at Stone Barns interest by sending them some seeds for 8 Row Flint Corn, an heirloom variety once common in New England and New York, but now virtually vanished. The Stone Barns people weren’t very interested, regarding corn as a ‘junk crop’. But Roberts offered to pay them to grow it, figuring that once a competent chef tried it, the chef would be hooked. And that is what happened. Roberts acts as an apostle of good taste…which is completely foreign to industrial agriculture which is entirely about yield and uniformity.

              All in all, I think that Barber gives all of us a lot to chew on and should prompt a re-examination of the role of grains in the community and in a kitchen garden.

              Don Stewart

            • Paul says:

              Great stuff Don.

              I am pleased to announce that we are now feeding 7 families off of our acre of garden in Bali — they no longer buy any vegetables — we’ve just terraced another acre or so and seedlings are going in the ground…

              A little bit of positive— amongst a heap of negativity.

            • The “where do all the calories come from” issue gets to be a big one, especially if industrial agriculture and transportation go downhill. I am growing sweet potatoes, sweet corn, and several kinds of beans in my garden this year (among other things). I have thought about rye as a winter crop–not just cover crop. Turnips are another fall crop.

            • Don Stewart says:

              How to convince your family that you have finally snapped. Here is one of Dan Barber’s ideas for his restaurant in the year 2050.

              ‘The first ides will take the form of tea made from an infusion of milky oats. Milky oats are baby oats, very nearly mature but still soft and sweet. Klass (one of his farmer suppliers), like many farmers, grows oats as a cover crop, mowing them down before maturity so they can enrich the soil and become fertility for the next crop.

              Without restoring fertility to the soil, delicious food is not possible. Which is really the message of milky oats. I’ll cook just the tip of the plant, the immature oat, full of sweet milk that makes an aromatic infusion. The rest will remain in Klaas’s field to profit the soil.

              If this works–which means if the tea is delicious and memorable–we may well create a market for cover crops, incentivizing more growers to incorporate them into their farms. But more important, we’ll create a consciousness about feeding the soil that feeds us.’

              This is just one of his examples of how, in 2050, he hopes to emulate ‘peasant food’, which used everything grown on the farm…as opposed to the modern notion of selecting only certain choice parts and throwing the other half away in landfills.

              My recent experience is that ‘using everything’ is a tough sell to most Americans. All of the corporate propaganda says ‘you can have exactly what you want’, and so things like CSA boxes which give you a slice of what the farm produced have been declining (still strong in the Northeast, I hear). They are being replaced by delivery systems which let you order what you want and then the middleman supposedly sources from local farms to the extent he can. But, in fact, he may source from Asia if he can increase his margins.

              About 7 or 8 years ago I learned how to use the food I had on hand…not what I bought for some recipe. Very liberating. About 5 years ago I did a cooking seminar for a group of people. I told them that we would prep and cook whatever they brought. They were to select a whole, fresh food to bring, plus a good knife. About three-quarters of them didn’t have a decent knife, and all of them were quite nervous about just bringing whatever caught their eye in the farmers market. But it worked out fine. You can cook virtually any combination of whole foods, with portions being very flexible. The notion that you need ‘a quarter of a cup of chopped spinach’ because some recipe tells you that is ridiculous. A meal is not an exercise in chemistry…bread is an exercise in chemistry and cheese and wine are exercises in chemistry, but a stir fry is not.

              I didn’t make any converts…at least that evening. They all wanted the comfort (slavery?) of being tied to recipes. I did make a convert of a lady in Florida who heard about the evening. She had five or six children, and she began to cook by asking each child to pick out something at the farmers market and then they all gathered around and prepped it all and cooked it all. She said it saved her life.

              In conclusion, you will know you have arrived (or gone over the edge) when you are making good use of your cover crops.

              Don Stewart

            • I know I have cooked wheat berries in the past. I understand that for these, the husk of the whole wheat grains must be removed. There are also recipes for oat groats. A person still has to remove the outermost shell, though. It is also possible to make sprouted out groats. It looks like it is still necessary to remove the outer shell, for these too. So perhaps your method is best.

            • Don Stewart says:

              The ‘milky oats’ tea is not my idea, it reflects the obsession that Dan Barber has for his project that chefs should promote ‘whole farm’ ecosystems by using ‘whole farm’ products in their restaurants. The opposite is ordering steaks from someone, and ignoring the other 90 percent of the cow.

              ‘Milky oats tea’ is a small advance, possibly, but I wouldn’t call it a free lunch. Grains as we normally think of them are formed when the plant is preparing to die and puts everything it has into its seeds, to prepare for the next generation. That is one reason that seeds and nuts are such nutritional powerhouses. But a farmer who is interested in putting that nutritional value into his soil doesn’t want the nutrition soaked up by seeds and nuts. Instead, he wants to kill the plant while it still has all that nutrition in the roots and stems and leaves, because he intends to get those into the soil either by turning them under, or composting them, or using them as mulch, or by feeding them to animals who turn them into manure and push them into the soil where the soil food web can get them.

              Therefore the ‘milky oats tea’ won’t be a particularly nutritious drink…unless Barber adds something else to it. It may be very refreshing and a good way to begin a meal, but I don’t think it will sustain you calorie wise.

              What it is, is just a clever way of pursuing Barber’s ideal.

              This is a variation on the ‘tail to snout’ movement which uses the entire animal. For example, a local BBQ chain buys whole cows and whole pigs and uses everything….not a common practice. The best Asian restaurant in town buys chickens and uses everything, including the feet and the cockscomb. The chef at the Asian restaurant was traveling in southeast Asia and was impressed by the common people’s use of everything, throwing away nothing. Barber aspires to something like that.

              Don Stewart

            • It wasn’t long ago that our forefathers used close to everything as well. I know my grandmother used to asked to get the blood from animals that had been butchered, in order to make blood soup. Such as dish seems to have been used in many parts of the world.

            • Jan Steinman says:

              “most permaculture practitioners do not talk much about grains.”

              I’m working on nuts, fruit, and root crops for carbs.

              We need to be thinking perennials for our diets. Grains require heavy inputs, and eventually destroy the soil.

              It would be nice to have some grains for luxury items (like bread!), but wherever humans have farmed grains for long periods, deserts have resulted. I don’t expect the US “breadbasket” to be any different when fossil sunlight inputs and water-pumping go away.

            • Paul says:

              Agree Jan – we grow no grains whatsoever — we do mainly vegetables but have planted dozens of banana plants of various varieties because they are high energy foods — and the plants are perennial and very easy to cultivate. We also plant a lot of papaya and pumpkin…

            • I will agree that grains are a problem. My issue is with claiming to be able to feed umpteen billion people, if the calorie issue (and equally important, the storage issue) hasn’t been completely addressed. Grains were certainly nice and compact for shipping. Without the endosperm, they keep well too. Too many people haven’t fully thought through a Plan B. Their plan is to grow lettuce and someone else will provide the calories. I am trying to grow nuts, fruit, and root crops too (but probably not in a great enough quantity to be very helpful). I do have a little sweet corn, for the first time this year, as well. Am worried about the effect on the soil, though.

            • Calista says:

              I planted small plot wheat this year. It was not a success. I think it drowned in the rains this spring. Also have sweet potatoes, two kinds of regular potatoes, corn, beans, etc. Nuts and fruit went in years ago and are beginning to bear nicely. I recommend reading everything written by Carol Deppe. I rarely re-read books and her books are one of the few that I read one again about three years after the first time and learned so much that I wasn’t ready for the first time through. I am going to either attempt winter wheat this fall or a rye crop.

              I don’t worry too much about corn depleting my soil. I rotate through with beans and put a great deal of compost on every fall. Usually the weeds and pullings of other parts of the garden plus available animal based nitrogen etc. We have some small animals available to harvest from.

              Whole grains store the best and learning to cook with them without the need for processing beyond the initial cleaning and husking is well worth the effort. I recommend some ideas from Paula Wolffert’s Mediterranean Grains and Greens, you can adapt most recipes to the grain available locally except maybe corn but she has suggestions for corn as do any south of the border cuisines.

            • Thanks for the suggestions. I will look into them.

            • Jan Steinman says:

              “I do have a little sweet corn, for the first time this year, as well. Am worried about the effect on the soil, though.”

              Start peeing in a bottle! Corn is a heavy nitrogen-feeder.

              Also, try the “three sisters” guild: corn with squash (which spreads and mulches, starving weeds of light) and climbing beans (which fix nitrogen and climb up the corn stalks).

            • It seems like with a lot of things, permaculture included, there are good ideas and not so good ones that come under the same banner. We are not going to find perfection in anything (except, what I say, which is always perfect except for the many typos :-) )

            • Ted Howard says:

              As a Permaculture gardener/designer/assistant teacher, I acknowledge Permaculture has a great mixture of folks in it.

              I’m a veteran peak oil researcher/activist, and come from that background. IMO population is secondary to the primary issue: the obscene energy throughput and toxic levels of consumption by the “civilised”, as if we have 5 to 8 biospheres, whilst the one we have, is already collapsing. But to do my tiny bit, I chose not to have kids, 20 years ago. Our individual lifestyle-ism doesn’t really cut it though:

              I’ve been to Permaculture events where David Blume was a keynote presenter and also where someone did a presentation on ‘sustainable cities’ promoting The Venus Project. IMO those 2 examples are at the far end of the spectrum, but cater to the mainstream “civilised” Permies who wear rose tinted glasses and desperately grasp on any hopium that comes by. Being highly “civilised” is more the issue here.

              As a more radical out-on-the-edge type Permie, I have no time for those 2. I see them both as ecologically insane and naive vapourware that do great disservice to what I believe Permaculture is: an ecologically based design science. As they both break the ecologically sane rules, I don’t consider them to be Permaculture.

              Permaculture.com is the website of David Blume. It is not ‘the’ website for Permaculture.

              Permaculture without full support of a resistance culture to the insane dominant culture devolves into OIMBY (Only in my back yard).

            • The article you link is good in pointing out the idea the our individual choices can change the system has become the dominant view. Part of the reason the reasoning isn’t right is because if we save money in one area, we spend it in another. Another part of the reason it isn’t right is because an awfully lot of the energy goes into the whole system that we are part of (government, roads, schools, healthcare, making products in China, agribusiness, financial system). I am not really sure that protest against our current system will do anything. What do we do–stand in front of a bus taking children on a field trip? Everything is so baked in the cake that we can’t even figure out how to cut back.

            • Don Stewart says:

              I might agree with your answer IF we were all getting richer and just trying to figure out what to do with our surplus money. BUT, as Stockman and others point out, the reality is that we Americans are getting poorer. The trend toward poor is obscured by all the money printing plus propaganda.

              Our real problem is ‘how to maintain, or increase, quality of life while consuming less’. The ‘consuming less’ is forced upon us, not a free choice. Your garden may very well improve your quality of life, while also reducing your grocery bill, and thus leave you with more of your shrinking income to spend on other things besides food. Therefore, the gardening should not be seen as privation, but a very clever way to maintain quality of life while also adapting to lower income.

              Don Stewart

            • kesar says:

              Facing dilemma who should be granted with reproduction permission (if anyone would have the power to grant it…) I choose Permaculturalists (even if they’re not aware that overpopulation is the main human problem). Someone has to carry the civilization in the future (whatever it will be… the future… and civilization) and children of permaculture people are much more suited for this matter than John Smith whos only skill in food provision is to drive his/her SUV to the nearest Walmart.

            • ordinaryjoe says:

              “Each cow makes different flavored butter depending on what they were eating, how they felt about Life, the Universe, and Everything, and so forth. ‘
              Tell me more top cat tell me more. :)

          • Massinissa says:

            Having 2 kids is reproducing merrily bro.

            If they had 0 or 1 kid that would be more reasonable.

            • ravinathan says:

              Hostility? A system built on questionable assumptions ought to be challenged and it can be the ultimate kindness to do so. Claiming that permaculture can feed 7 B or 9 B and 13 B as many permies do is hopium.

            • Jan Steinman says:

              With all due respect, sir, if you think Permaculture is “built on questionable assumptions,” then you do not appear to understand Permaculture.

              If the “gold standard” for something is that none of its followers say stupid things, then this very list should be tarred with the same brush.

              As I said, don’t let the perfect be the enemy of the good. There are no real solutions, only coping strategies, and Permaculture is as good a coping strategy as anything else out there.

              Please go back to picking on BAU and TPTB, and leave alone those of us who are working to affect positive charge.

  26. pitashtia says:

    The Sun is the only relatively inexhaustible source and no other reasonable alternative.

    • The big issue with resource use is that we tend to use resources faster than they renew. With forests, this results in deforestation. With aquifers, this results in depletion. Fossil fuels might renew, given enough million years also, but we are using them very much faster than they renew. The quantity of uranium in the earth’s surface is limited as well.

  27. Hi Don
    If you look at the psychology of people from the perspective of Types such as the Myers Briggs, one could conclude that perceptually a significant part of society as individuals is unable to process the systemic effects of their actions.
    I guess what I’m saying is there may be intelligence but it lacks wisdom.

  28. Don Stewart says:

    Dear Gail
    Another good post…congratulations.

    This is perhaps a minor point, but I have begun to notice it everywhere. My food co-op recently renovated the space. The restrooms had been quite dreary spaces, and they were replaced with sparkling appliances and good lighting.

    But let’s look at the vulnerabilities:
    1. There is no window. In the event that electricity is lost, I hope someone has candles. And you can forget about ventilation
    2. The toilet flushes and the water faucets operate under the control of microprocessors which sense when those events should happen. There are no manual overrides.
    3. The best hand dryer I have ever used was installed. Stick your hands into a cavity and warm air quickly blasts your hands dry. No manual override, and no paper towels.

    I have begun to notice fragility built into everything. I was talking with someone about Apple products, and I remarked that Apple’s goal seems to be to predict what it is you will want to do next, and then to do it. If that isn’t what you wanted to do, good luck figuring out how to do what you actually want. My schoolteacher conversation companion remarked that she thinks the increasing ‘automation of thought’ is behind many of the problems we are experiencing in schools.

    I suspect that we really are ‘too clever for our own good’.

    Don Stewart

    • Harry says:

      Complexity and practicality are uneasy bedfellows. And it seems that every move towards complexity pushes us further from sanity and self-reliance. Even toasters have microchips now.

      • I bought a new clothes washer recently, and was surprised by all of the technology it has.

        • interguru says:

          I predict that cars built before they used computers to control them will become very valuable ( assuming the collapse is slow, and there is some oil available ).

          • Repairing any kind of car is likely to be a problem. Keeping roads in good condition is likely to be another problem. The network of gas stations and pipelines is not designed to run with just a little oil in it. There is a “minimum operating level” problem.

          • Jan Steinman says:

            I won’t have a vehicle that is controlled by computer.

            Of course, that means my vehicles get older and older! But it’s amazing how many pre-computer vehicles are still running strong, while ones just a year or two older are trashed because replacing the electronics modules has become too expensive.

            Same goes for power door locks and power windows. If you can’t roll the window down by hand, you’d better stay away from toll booths. :-)

        • Hiruit Nguyse says:

          I just recycled an old Whirlpool to avoid exactly that Technology. They are designed to fail. You can’t imagine how many whirlpool wahsers are tossed out over a $13 plastic coupling!


          • My previous washer was high-tech. The repairman said that they in general tended to fail quickly. (This one is high tech too, but the door is on the top, rather than the front.) We could never get the previous washer to do the fast-spin cycle–it was not stable enough the way the arrangement was set up. So the clothes went into the dryer wetter than they were supposed to be. At least with the door on the top, gravity will be working in the right direction.

    • I agree with you. I have had the same thoughts about rest rooms.

      Even when people think they are building in more flexibility, say through new train systems, they expect the fanciest modern trains, using technology from around the world. Often, they expect the trains will run more rapidly than in the past. But the trains are very hard to repair,so won’t last long at all. Neither will wind turbines, or solar PV installed to operate in the electric grid.

    • ordinaryjoe says:

      Well theirs always open sewage flowing straight into the river to fall back on. :)

      • Ted Howard says:

        Or going as fast as we can to ecologically sound and sane composting toilets, with urine separators to make nitrogen fertiliser for our food gardens, and using EM (effective micro-organism) composting to speed up returning solids to soil…

        Or using biogas digestors as they do in small villages in India, so we have gas for cooking and lighting, rather than electricity…remember 1/3 to 1/2 of humanity right now, gets by quite OK with no access to electricity…only the “civilised” feel such strong entitle-ism/entitle-itis to having huge electricity access 24/7.

        We could do this differently!

        • Harry says:

          India is hot. Living without electricity in a cold climate would be highly challenging and necessitate a lot of wood burning. I really don’t think the problem is a sense of entitlement. We’re just born into a state of dependence on infrastucture that is powered by fossil fuels. Attempting to alter that infrastructure in any wholesale way would entail bumping up against the financial limits about which Gail has written so much. Composting toilets are an excellent idea.

        • ordinaryjoe says:

          I got sawdust from the mill and ran a composting toilet ala 5 gallon bucket with seat on top for about a half a decade. Worked great!- no real smell if emptied to the composter regular. I did let that compost sit a couple years before using.

  29. witsendnj says:

    A very enlightening post as always. The caveat I would make however, is that although the IPCC errs in its projections of emissions from oil as you point out, any saving grace that confers is far outweighed in the opposite direction. Their most dire climate scenarios are vastly skewed towards the overly optimistic, because they also don’t account for the amplifying feedbacks that have been set in motion and are irreversible. The initial forcing from anthropogenic fossil fuel emissions is already dwarfed by the feedbacks, which is why real-time data is outpacing model predictions. Earlier collapses are useful to study but the coming collapse is unprecedented because it is global and there is no place to emigrate to, plus, the pollution we have created – nuclear and other toxins in the air, water and soil – is unlike anything humans have ever released into the environment in the past.

    • If most (or all) humans are dead from other causes already, the dire scenarios the IPCC projects will not really matter to us. The earth will recover, regardless of the outcome for humans.

      The danger of making a forecast vastly overstating the amount of fossil fuels that can actually be burned is (1) people are unaware of the real problems we are facing and (2) we end up scurrying around in directions that are questionable at best.

  30. Brad says:

    Thanks again Gail for a well thought through analysis of our current situation. It does make me wish that we had jumped in with both feet into the nuclear option at the time.

    • The nuclear option only makes sense if

      (1) It really is extremely safe. We have several counter-examples to this already, and as our networked systems fails, I am afraid we will have a lot more.
      (2) It really is extremely cheap. Once we start adding all of the safety controls that are needed, it stops being cheap.
      (3) We can get around the depletion issue of uranium. Uranium in the top layers of the earth’s surface has a similar depletion issue to fossil fuels–extraction reaches diminishing returns. There is the possibility of recycling, but some uranium is always lost in the process, and the process is expensive (energy consuming).

      Furthermore, without a way of making all kinds of liquid fuels very cheaply, nuclear is only an electricity product. Electricity is not an adequate substitute for oil. In particular, we cannot build nuclear power plants without oil, and we cannot decommission nuclear power plants without oil.

      • Stephen Heyer says:

        Hi Gail. Your usual excellent post, my one disappointment is that you equated nuclear energy entirely with uranium.

        First, there is fusion, of which there are now about four or five types, all of which show some signs, sometimes, of working in the laboratory – supposedly. Maybe someone will finally get one kind or another working well enough to actually be a useful power source.

        Then there is what is increasingly regarded as the best bet – Thorium.

        About the best brief discussion of which I’ve found to date is at http://oilprice.com/Energy/Energy-General/Thorium-Energy-Savior-or-Red-Herring.html . However, do read the comments at the end as some important issues that were missed in the post are brought up there.

        The other thing is the vast increase in efficiency that is occurring in some areas (remember, I said some). For example, our new LED lighting system uses about 10%, I repeat, 1/10th the power of the old one.

        Now I know the problems with greater efficiency leading to greater use of a finite resource, but this is a whole new game, it makes things practical that just were not before. For example, this makes an entirely solar powered lighting system easy, especially as it vastly reduces the size and cost of the batteries.

        Now I’m not saying that this kind of leap will happen everywhere, just that it will and is in some areas. There is no way that it will solve all our problems but I believe that it does mean that the solution space is much more complex than many believe and much more interesting.

        Stephen Heyer

        • interguru says:

          “First, there is fusion, of which there are now about four or five types, all of which show some signs, sometimes, of working in the laboratory – supposedly. Maybe someone will finally get one kind or another working well enough to actually be a useful power source.”

          I worked on fusion research ( see http://en.wikipedia.org/wiki/Trisops which I wrote ). for several years and was a program officer at the US Office of Fusion Energy. For the past 50 years fusion has been 25 years in the future and still is. Even if the intractable physics and engineering problems can be solved, it will be extremely expensive, not competitive with anything.

          I can summarize the physics problem — it is like trying to confine a ball of angry Jello in cage of rubber bands. Engineering — trying to make a wall that will hold up under almost sun-like conditions.

          • timl2k11 says:

            The idea that we can somehow create something that resembles the hydrostatic equilibrium of the sun and control the energy from it has always struck me as absurd. I mean it seems like anyone who knows basic physics ought to know man made fusion (for energy, not destruction like in nukes) is a non-starter.

          • Paul says:

            Hey I know! Why not stick a very long metal rod into the sun — and draw down its energy to earth — and power a massive fusion reactor!!!!

            I think I am on to something here….

        • ordinaryjoe says:

          “our new LED lighting system uses about 10%, I repeat, 1/10th the power of the old one.”
          What was the old one incandescent or florescent? Does that include power loss on coverting ac to dc? Most LED power supply manufacturerers wont publish efficiency specs- with good reason. Go to your power supply hold your hand over the unit feel all that heat? Compare to 100 watt incandescent lightbulb heat and guess power consumption. Oh my your 2 watt leds use 100 watts. Add that into your power equation. If youve got a high dollar efficient ( 85%) ac-dc power supply add the energy of its manufacture to your equation. AND add its loss into your equation. Whats your power supplies mean time to failure? Many of the LED power supplies coming out of china have cut BIG corners in basic design- no heat sinks- to save cost. I have encountered some with mean time to failure measured in months. Or do you have DC available to use? If so add the energy of battery manufacture to your power equation. A diode light emiting or otherwise is fundamentally a DC device. Power loss providing the DC for LED lighting is much greater than the power savings in my experience. Florescent remains the conservationist choice in my experience. Honestly do you like the asthetic quality of your LED lighting is it functional? Hurts my eyes. If youve evaluated these factors and like your LED lighting tell me so but in most cases LED lighting is a sham in my experience using much more energy to provide much less usable light than florescent.

          • timl2k11 says:

            Whoa. Hold on there Joe. I think the strike against LED’s is they are higher up on the technology curve than incandescent. But compared to CFLs (screw in type I’m talking here) they can be more efficient (up to 90 lumens per watt vs 60 for the best in each class) and don’t have mercury. Their CRI can be just as good as CFLs, as both use phosphors. They also can last much longer than CFLs (10,000 hrs max for CFL, 25-50,000 for LEDs)Otherwise both are quite high on the technology curve compared to incandescents. If one is having to replace incandescents, LED light bulbs seem to be the clear winner.

            • ordinaryjoe says:

              Im very willing to be proved wrong. :) Their may be stuff out there this dumb hick doesnt know about. I feel very comfortable in my statement “A diode light emiting or otherwise is fundamentally a DC device.” and my remarks regarding power supplies efficiency.
              Which of my analysis is wrong?

              Diodes require DC
              Right wrong?
              Dc power supplies are ineficient, prone to failure or costly slightly more efficient and slightly less prone to failure ?
              Right wrong?
              Batteries as a DC source and the hardware to maintain them EROI is miserable.
              Right wrong?

              I do know when a heat is coming off a power supply for two watts of LED lighting equals 100 watts that heat didnt come from nowhere. That my simplistic view Where am I wrong? actual experience -measured and observed results please. If you know a way of obtaining DC without a costly or inneficient and prone to failure power supplies or a bank of batteries educate me. Im not a big fan of acronyms and I think a manufacturer would call the sky orange if it sold their product. They can call a electronic spec any which way they want unless the customer is going to call them on it the spec will be creative. I am a fan of statements like” joe I have run XYZ brand led lighting for 4 years they are very reliable. I have measured the power they use and they are x more efficient than florescent. The light they produce is very pleasing to my eye” rather than the use of acronyms.

              Where am I wrong? What is your experience? Dont be shy.

            • Jan Steinman says:

              “I do know when a heat is coming off a power supply for two watts of LED lighting equals 100 watts that heat didnt come from nowhere.”

              That is simply untrue.

              By law, the power rating of the device in the package is the power it draws from the wall. They can say things like, “Provides the light equivalent to a 100 watt incandescent bulb,” but they cannot lie about how much power they draw from the wall.

              The power supplies are very efficient, probably 85% or better. But that has nothing to do with the power rating printed on the label: a 50% efficient power supply on a 3W LED would be a 6W LED on the packaging.

              I like LEDs and use them as I can afford them. But it is true that they aren’t going to “save the world.” At best, they’re a stop-gap that enable some of us to extend our alternative energy use.

              However, your rant is not going to influence people who know about electricity. (I’m an EE.)

              Yes, LEDs use DC. You lose 0.2 to 0.7 volts (depending on materials) when converting from AC to DC. Except for this “barrier potential,” rectifiers are nearly 100% efficient.

              Likewise, modern switching DC power supplies — like essentially all the LED power supplies — can be upwards of 95% efficient.

              The ERoEI of lead acid batteries is not all that bad. They can be made in a small town or large village. This is 100+ year-old technology! (But modern lithium batteries is another matter…)

              I’m not defending any of these things as something that’s going to “save the world,” but your arguments are not going to convince anyone who knows electronics.

            • ordinaryjoe says:

              “That is simply untrue.”
              I see. Your a EE have you measured them? You owe me an apology.
              They are selling them off of the led power rating not the power consumed- every single one. http://www.ebay.com/itm/10W-20W-30W-50W-100W-LED-Flood-light-Outdoor-Landscape-Lamp-IP65-Waterproof-/231209873694?pt=LH_DefaultDomain_0&var=&hash=item35d52eb11e

              “The power supplies are very efficient, probably 85% or better. But that has nothing to do with the power rating printed on the label: a 50% efficient power supply on a 3W LED would be a 6W LED on the packaging.”

              measure get back to me with your apology. Either the law you spoke of doesnt exist or the china manufacturers lied- who would of thought- a 2 watt led equals a two watt product.regardless of power consumed.

              “Likewise, modern switching DC power supplies — like essentially all the LED power supplies — can be upwards of 95% efficient.”

              Show me one. Show me one DC power supply with a 95% efficiency spec sheet let alone “upward of 95%”. Just one regardless of cost. Take a good switching power supply like a condor – your saying there is one of those in the LED lighting? Look at a good switching power supply. Hmm why all those heat sinks and holes cut in the enclosure to dissipate heat? Look at a big one why the fan? Must be because no energy is wasted as heat in a switching power supply.
              Jan you are defending a technology that wastes energy- why?

            • Stephen Heyer says:

              timl2k11: “Whoa. Hold on there Joe. I think the strike against LED’s is they are higher up on the technology curve than incandescent.”

              Yes, that was my take too, though I too had wondered about the amount of heat they produced. Still, our power usage is now very low. Lucky that, as our current excuse for a government is allowing the power companies to hugely increase their charges partially because so many others are doing this that electricity usage is FALLING!

              Funny, some years back the excuse was that the RISING electricity usage made higher charges necessary!!!

              Also, I’m not too worried about the supply of small, high value items such as LED’s or even the simpler ICs and computer processors. You see, I’ve watched the development and rise of them all. I remember the 50s and 60s when a small nation like Australia produced its own consumer and even military electronics.

              At one point we were even producing micro processors.

              If we had to we could again.

              And of course small, high value items like that were once traded around the world in sailing ships, and could be again.

              No, I expect that even deep into Post Peak Oil simplified but effective versions of such items will be readily available, just not as ridiculously cheap as they are now.

              Stephen Heyer

            • The point that people have not realized is that a drop in base usage of electricity (whether from wind turbines, solar PV, or efficiency) does not reduce the cost of electricity production anywhere near proportionately. In fact, it is possible if enough adjustments need to be made to the system (more long distance transmission, more electrical storage capacity, upgraded control systems) that the overall cost of producing a smaller amount of electricity may rise. Even if this doesn’t happen, a lot of the electricity costs are fixed. For example, the cost of maintaining electrical transmission is fixed or rising.

              It is the peak load problem that needs to be solved. This is basically an air conditioning /heating issue on very hot/cold days of the year. One approach would be to require that all heating/cooling systems have a central override that would adjust the thermostat when not enough electricity is available.

            • timl2k11 says:

              Very good point Gail. I have seen people online gloating about how they bought such and such light bulb and wow how they have reduced their [energy] footprint. Uhm, no not really, most people haven’t a clue. In addition, if a device or appliance reduces your energy bill by $X, and then you go and spend $X on something else you have not reduced your energy footprint one bit. People do not realize that all spending contributes to their energy footprint, not just what they spend directly on electricity and fuel.

        • Jan Steinman says:

          Those fusion and thorium reactors that don’t yet exist and those super-efficient LEDs require all of human civilization in order to exist. With any of the various industrial systems (mining, transportation, finance, education, medicine, etc.), such wonders will never happen.

          We need to start thinking about simpler technology, not more complex technology!

          • Stephen Heyer says:

            Jan Steinman: “those super-efficient LEDs require all of human civilization in order to exist. With any of the various industrial systems (mining, transportation, finance, education, medicine, etc.), such wonders will never happen.

            No they don’t, at least not if you mean all 7 Billion or so of us and all the technology and (often pointless) stuff we currently manufacture and in the volume we currently manufacture it in.

            To partially repost something I’ve already written I’ve watched the development and rise of about all of what people think of as advanced technology. I remember the 50s and 60s when a small nation like Australia (then about 6 million people) produced its own consumer and even military electronics.

            At one point we were even producing micro processors. If we had to we could again.

            I’m just not too worried about the supply of small, high value items such as LED’s or even the simpler ICs and computer processors. Once small, high value items like this were traded around the world in sailing ships, and could be again if things turn out as badly as Gail Tverberg and John Greer think.

            No, I expect that even deep into Post Peak Oil simplified but effective versions of such items will be readily available, just not as ridiculously cheaply as they are now.

            But yes, Jan Steinman is right, “We need to start thinking about simpler technology” and that is exactly what I expect to see in a Post Peak Oil future. But what I don’t expect is a total loss of advanced technology.

            Stephen Heyer

            • You may not expect the total loss of advanced technology, but if the economic network fails, I am afraid that this is exactly what happens. Part of the problem is that governments fail. If the failures are the government of Iraq and of Saudi Arabia, we could find world oil production dropping dramatically overnight. If prices go up, we will find that oil importers have huge increases in costs. As these costs ripple through the system, there will be big debt defaults, and as a result bank failures. These bank failures will tend to cause a problem for the rest of the system, particularly governments. As governments and financial institutions fail, it becomes harder and harder to make goods that require imports from around the world, like LEDs, but also a lot of simpler things. It makes it impossible to make computers. In this day and age, that means that factories would not be able to replace computers, once repairs are needed, leading to a breakdown of supply chains.

            • Jan Steinman says:

              “I remember the 50s and 60s when a small nation like Australia (then about 6 million people) produced its own consumer and even military electronics. At one point we were even producing micro processors. If we had to we could again.”

              Those things Australia made sixty years ago were done with a tiny fraction of the resources we have at our disposal today. Primitive integrated circuits were done at a resolution of hundreds of microns, with tens of transistors. That could be done with traditional optics and photochemicals, resources a small city could marshall nearly on its own, with only a few low-use scarce items imported.

              Today’s microprocessors use sub-micron geometry, fitting billions of transistors on a single chip. To do so, ultraviolet or even x-ray lithography is used, which requires extremely complicated masking and focusing systems, dependent on the same technology it creates.

              In addition, the modern semiconductor industry has necessarily become a global industry. Australia cannot produce LEDs and modern microprocessors using resources primarily from within its borders. Rare elements like gallium and indium are found in very few places, and they are all at or near peak resource extraction, and generally found in places that are unwilling to give them up easily.

              Consider civilization as a pyramid. At it’s base is the civilization’s primary energy source. Above that are other resources (ores, secondary fuels, food) that are obtained using the primary energy source. Atop that are “virtual resources” that the civilization creates from lower levels of the pyramid, such as economy, education, health-care, governance, etc.

              On the outside of this pyramid are all the things that appear to make a civilization great: smart phones, satellite location tracking, bio-engineered food, open-heart surgery, doctorate degrees in art history, particle accelerators, electron microscopes, the Internet, etc.

              So what happens when the base of the pyramid shrinks?

              Assuming that the geometry of the pyramid must remain constant (does civilization have an “angle of repose?”), a shrinking primary energy base means that the pyramid is necessarily shorter, and the stuff on the outside must be sloughed off.

              It remains to be seen if isolated pockets of high energy can remain. Ugo Bardi notes that Italy is now down to 1967 petroleum consumption, and yet, Italians still have smart phones! Italy still has the global supply system in place, but when an entire closed system has a reduced energy base, it seems clear that the higher functions that were supported by the larger base must go.

              I’m not claiming it’s going to be like turning a phonograph record (Ha! remember those?) backwards. For one thing, there are nearly four times as many people than there were 60 years ago. For another thing, all those resources that you could get in 1950 by sticking a shovel in the ground now require tremendous infrastructure and energy to extract — mining has gone from recovering a few percent of a desired material from ore to parts per million!

              Today’s high-output LEDs require a tremendous amount of pyramid under them. They are as different from the first LEDs in the ’60s as a Tesla Model S is from a Ford Model T. Will highly-efficient LED lighting be around for much longer? Perhaps, but I wouldn’t bet on it.

            • kesar says:

              Dear Stephen,
              When Australia produced those fancy electronic toys in 50s and 60s, how do you think how many of the production equipment was imported to do it? When supply chains break you don’t have access to such basic things like copper and many more. Even if you have it locally it’s hard to maintain all the connections vide complexity.
              I hope you are right, but still I have lot of doubts.


            • Stephen Heyer says:

              Hi Gail,
              I agree with the general thrust of your argument, always have. I guess where we disagree is some of the fine details and the likely degree and timing of any collapse.

              Even there, I don’t think it is a hard disagreement but rather that I think (based of history such as the causes of WWI, the recovery after WW2 and the history of previous civilizations) that what happens depends on the fine detail of exactly what the current bunch of incompetents who lead us actually do. And, of course, on a myriad of other factors such as exactly which technologies succeed, which fail and what new minerals deposits are found and where they are.

              In other words, as I wrote before, that the “solution space” is likely to be both much larger and much more complex than most suppose.

              Stephen Heyer

          • Philip Backus says:

            Jan. I agree wholeheartedly with your last statement. I also feel that many who dislike the idea of home scale utilities dislike them because when something goes wrong YOU are responsible for the outage and no one will listen to you rant about corruption,politics or rigged energy markets. YOU are responsible for your own necessities and comforts. We are no longer a nation who gives any serious consideration for our future. All I can say to the willfully obese, ignorant, and entitled tv addicts is….tic toc.

        • Paul says:

          Fusion is more pie in the sky nonsense. It never has and likely never will produce a nett outflow of energy.

          And even if it could — we have the same issues as we have with nuclear energy — which Gail has already outline above i.e. that it cannot replace oil.

          Try making pesticides and fertilizers out of ‘fusion’ and growing crops.

        • edpell says:

          My favorite fusion technology is the wiffleball/polywell
          the idea was invented by the Farnsworth circa 1930, the same guy who invented TV.

        • There are several issues involved with adopting new ways of making nuclear energy:

          1. Our problem is to a significant extent a liquid fuels (of many types) problem. Adding electricity doesn’t fix this problem.

          2. Our problem is an immediate problem (next five years), not something fifty years from now.

          3. Using nuclear of any kind exacerbates our fresh water problem, because it is used to run steam boilers.

          4. Because of safety issues, nuclear of any kind will ramp up slowly at best. Building these plants requires oil, exacerbating any shortage we have. We will not have the oil we need to decommission them either.

          With respect to LED lighting, that is nice, but from the electric power plant’s perspective, our problem is a growing need for “peak capacity”. LED light bulbs don’t add peak capacity. In fact, wind and solar PV tend not to either. What is needed is very high prices for peak capacity from fossil fuel plants. This needs to be built into the rates somehow.

          • edpell says:

            All, in NYC to deal with the peak issue they regulate demand. They do not use any super high tech gizmos. ConEd has an agreement with the 20 largest office buildings in the city. At peak ConEd calls them and ask that they set the air conditioning from 68 degrees to 78 degrees. It works.

          • edpell says:

            An interesting point for NYC. There peak issue is not a shortage of supply it is a shortage of distribution wires. That is, if they supply the full requested load it will cause the cables buried under the streets to over heat and burn. At that point the only recourse is to black out the whole substation neighborhood. Cables installed 60 years ago buried deep under ground (well insulated) need to be replaced but ripping up all of Manhattan’s streets would be expensive.

        • Sylvia says:

          LED or not… this does not remove the problem. We use less power using LEDs and compared to last year our electricityt bill is still about 10% higher. The problem is that when people use less, prices rise – the power company needs still the same or even higher amount of money to operate – and going forward less people can afford it. This however makes less paying customers and hence increases prices for the remaining few (otherwise the power companies can not do business, they do need a minimum operating amount)….. which then leads to evenless customers and soon. Same thing everywhere.

          • InAlaska says:

            This is generally the reason why the large utility companies oppose residential solar and wind, it bites into their customer base. If enough people were to go that route it would spell the end of the grid as we know it. They need economies of scale and and a dedicated customer base, almost monopolistic, which is why they were turned into public utilities back in the day.

      • Sylvia says:

        Most people think about oil as “energy”. The “materials”-aspect though is just as important. If we had plenty of cheap energy it would still be difficult to produce sophisticated materials like plastics, fibers, pesticides, herbicides, fertilizers, medical treatments and so on. Those are needed though to produce energy, the network “bites back” all the time.

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