Globalization seems to be looked on as an unmitigated “good” by economists. Unfortunately, economists seem to be guided by their badly flawed models; they miss real-world problems. In particular, they miss the point that the world is finite. We don’t have infinite resources, or unlimited ability to handle excess pollution. So we are setting up a “solution” that is at best temporary.
Economists also tend to look at results too narrowly–from the point of view of a business that can expand, or a worker who has plenty of money, even though these users are not typical. In real life, the business are facing increased competition, and the worker may be laid off because of greater competition.
The following is a list of reasons why globalization is not living up to what was promised, and is, in fact, a very major problem.
1. Globalization uses up finite resources more quickly. As an example, China joined the world trade organization in December 2001. In 2002, its coal use began rising rapidly (Figure 1, below).
Figure 1. China’s energy consumption by source, based on BP’s Statistical Review of World Energy data.
In fact, there is also a huge increase in world coal consumption (Figure 2, below). India’s consumption is increasing as well, but from a smaller base.
Figure 2. World coal consumption based on BP’s 2012 Statistical Review of World Energy
2. Globalization increases world carbon dioxide emissions. If the world burns its coal more quickly, and does not cut back on other fossil fuel use, carbon dioxide emissions increase. Figure 3 shows how carbon dioxide emissions have increased, relative to what might have been expected, based on the trend line for the years prior to when the Kyoto protocol was adopted in 1997.
Figure 3. Actual world carbon dioxide emissions from fossil fuels, as shown in BP’s 2012 Statistical Review of World Energy. Fitted line is expected trend in emissions, based on actual trend in emissions from 1987-1997, equal to about 1.0% per year.
3. Globalization makes it virtually impossible for regulators in one country to foresee the worldwide implications of their actions. Actions which would seem to reduce emissions for an individual country may indirectly encourage world trade, ramp up manufacturing in coal-producing areas, and increase emissions over all. See my post Climate Change: Why Standard Fixes Don’t Work.
4. Globalization acts to increase world oil prices.
Figure 4. World oil supply and price, both based on BP’s 2012 Statistical Review of World Energy data. Updates to 2012$ added based on EIA price and supply data and BLS CPI urban.
The world has undergone two sets of oil price spikes. The first one, in the 1973 to 1983 period, occurred after US oil supply began to decline in 1970 (Figure 4, above and Figure 5 below).
Figure 5. US crude oil production, based on EIA data. 2012 data estimated based on partial year data. Tight oil split is author’s estimate based on state distribution of oil supply increases.
After 1983, it was possible to bring oil prices back to the $30 to $40 barrel range (in 2012$), compared to the $20 barrel price (in 2012$) available prior to 1970. This was done partly by ramping up oil production in the North Sea, Alaska and Mexico (sources which were already known), and partly by reducing consumption. The reduction in consumption was accomplished by cutting back oil use for electricity, and by encouraging the use of more fuel-efficient cars.
Now, since 2005, we have high oil prices back, but we have a much worse problem. The reason the problem is worse now is partly because oil supply is not growing very much, due to limits we are reaching, and partly because demand is exploding due to globalization.
If we look at world oil supply, it is virtually flat. The United States and Canada together provide the slight increase in world oil supply that has occurred since 2005. Otherwise, supply has been flat since 2005 (Figure 6, below). What looks like a huge increase in US oil production in 2012 in Figure 5 looks much less impressive, when viewed in the context of world oil production in Figure 6.
Figure 6. World crude oil production based on EIA data. *2012 estimated based on data through October.
Part of our problem now is that with globalization, world oil demand is rising very rapidly. Chinese buyers purchased more cars in 2012 than did European buyers. Rapidly rising world demand, together with oil supply which is barely rising, pushes world prices upward. This time, there also is no possibility of a dip in world oil demand of the type that occurred in the early 1980s. Even if the West drops its oil consumption greatly, the East has sufficient pent-up demand that it will make use of any oil that is made available to the market.
Adding to our problem is the fact that we have already extracted most of the inexpensive to extract oil because the “easy” (and cheap) to extract oil was extracted first. Because of this, oil prices cannot decrease very much, without world supply dropping off. Instead, because of diminishing returns, needed price keeps ratcheting upward. The new “tight” oil that is acting to increase US supply is an example of expensive to produce oil–it can’t bring needed price relief.
5. Globalization transfers consumption of limited oil supply from developed countries to developing countries. If world oil supply isn’t growing by very much, and demand is growing rapidly in developing countries, oil to meet this rising demand must come from somewhere. The way this transfer takes place is through the mechanism of high oil prices. High oil prices are particularly a problem for major oil importing countries, such as the United States, many European countries, and Japan. Because oil is used in growing food and for commuting, a rise in oil price tends to lead to a cutback in discretionary spending, recession, and lower oil use in these countries. See my academic article, “Oil Supply Limits and the Continuing Financial Crisis,” available here or here.
Figure 7. World oil consumption in million metric tons, divided among three areas of the world. (FSU is Former Soviet Union.)
Developing countries are better able to use higher-priced oil than developed countries. In some cases (particularly in oil-producing countries) subsidies play a role. In addition, the shift of manufacturing to less developed countries increases the number of workers who can afford a motorcycle or car. Job loss plays a role in the loss of oil consumption from developed countries–see my post, Why is US Oil Consumption Lower? Better Gasoline Mileage? The real issue isn’t better mileage; one major issue is loss of jobs.
6. Globalization transfers jobs from developed countries to less developed countries. Globalization levels the playing field, in a way that makes it hard for developed countries to compete. A country with a lower cost structure (lower wages and benefits for workers, more inexpensive coal in its energy mix, and more lenient rules on pollution) is able to out-compete a typical OECD country. In the United States, the percentage of US citizens with jobs started dropping about the time China joined the World Trade Organization in 2001.
Figure 8. US Number Employed / Population, where US Number Employed is Total Non_Farm Workers from Current Employment Statistics of the Bureau of Labor Statistics and Population is US Resident Population from the US Census. 2012 is partial year estimate.
7. Globalization transfers investment spending from developed countries to less developed countries. If an investor has a chance to choose between a country with a competitive advantage and a country with a competitive disadvantage, which will the investor choose? A shift in investment shouldn’t be too surprising.
In the US, domestic investment was fairly steady as a percentage of National Income until the mid-1980s (Figure 9). In recent years, it has dropped off and is now close to consumption of assets (similar to depreciation, but includes other removals from service, such as removals because manufacturing has moved overseas). The assets in question include all types of capital assets, including government-owned assets (schools, roads), business owned assets (factories, stores), and individual homes. A similar pattern applies to business investment viewed separately.
Figure 9. United States domestic investment compared to consumption of assets, as percentage of National Income. Based on US Bureau of Economic Analysis data from Table 5.1, Savings and Investment by Sector.
Part of the shift in the balance between investment and consumption of assets is rising consumption of assets. This would include early retirement of factories, among other things.
Even very low interest rates in recent years have not brought US investment back to earlier levels.
8. With the dollar as the world’s reserve currency, globalization leads to huge US balance of trade deficits and other imbalances.
Figure 10. US Balance on Current Account, based on data of US Bureau of Economic Analysis. Amounts in 2012$ calculated based on US CPI-Urban of the Bureau of Labor Statistics.
With increased globalization and the rising price of oil since 2002, the US trade deficit has soared (Figure 10). Adding together amounts from Figure 10, the cumulative US deficit for the period 1980 through 2011 is $8.6 trillion. By the end of 2012, the cumulative deficit since 1980 is probably a little over 9 trillion.
A major reason for the large US trade deficit is the fact that the US dollar is the world’s “reserve currency.” While the mechanism is too complicated to explain here, the result is that the US can run deficits year after year, and the rest of the world will take their surpluses, and use it to buy US debt. With this arrangement, the rest of the world funds the United States’ continued overspending. It is fairly clear the system was not put together with the thought that it would work in a fully globalized world–it simply leads to too great an advantage for the United States relative to other countries. Erik Townsend recently wrote an article called Why Peak Oil Threatens the International Monetary System, in which he talks about the possibility of high oil prices bringing an end to the current arrangement.
At this point, high oil prices together with globalization have led to huge US deficit spending since 2008. This has occurred partly because a smaller portion of the population is working (and thus paying taxes), and partly because US spending for unemployment benefits and stimulus has risen. The result is a mismatch between government income and spending (Figure 11, below).
Figure 11. Receipts and Expenditures for all US government entities combined (including state and local) based on BEA data. 2012 estimated based on partial year data.
Thanks to the mismatch described in the last paragraph, the federal deficit in recent years has been far greater than the balance of payment deficit. As a result, some other source of funding for the additional US debt has been needed, in addition to what is provided by the reserve currency arrangement. The Federal Reserve has been using Quantitative Easing to buy up federal debt since late 2008. This has provided a buyer for additional debt and also keeps US interest rates low (hoping to attract some investment back to the US, and keeping US debt payments affordable). The current situation is unsustainable, however. Continued overspending and printing money to pay debt is not a long-term solution to huge imbalances among countries and lack of cheap oil–situations that do not “go away” by themselves.
9. Globalization tends to move taxation away from corporations, and onto individual citizens. Corporations have the ability to move to locations where the tax rate is lowest. Individual citizens have much less ability to make such a change. Also, with today’s lack of jobs, each community competes with other communities with respect to how many tax breaks it can give to prospective employers. When we look at the breakdown of US tax receipts (federal, state, and local combined) this is what we find:
Figure 12. Source of US Government revenue, by year, based on US Bureau of Economic Analysis Data.
The only portion that is entirely from corporations is corporate income taxes, shown in red. This has clearly shrunk by more than half. Part of the green layer (excise, sales, and property tax) is also from corporations, since truckers also pay excise tax on fuel they purchase, and businesses usually pay property taxes. It is clear, though, that the portion of revenue coming from personal income taxes and Social Security and Medicare funding (blue) has been rising.
I showed that high oil prices seem to lead to depressed US wages in my post, The Connection of Depressed Wages to High Oil Prices and Limits to Growth. If wages are low at the same time that wage-earners are being asked to shoulder an increasing share of rising government costs, this creates a mismatch that wage-earners are not really able to handle.
10. Globalization sets up a currency “race to the bottom,” with each country trying to get an export advantage by dropping the value of its currency.
Because of the competitive nature of the world economy, each country needs to sell its goods and services at as low a price as possible. This can be done in various ways–pay its workers lower wages; allow more pollution; use cheaper more polluting fuels; or debase the currency by Quantitative Easing (also known as “printing money,”) in the hope that this will produce inflation and lower the value of the currency relative to other currencies.
There is no way this race to the bottom can end well. Prices of imports become very high in a debased currency–this becomes a problem. In addition, the supply of money is increasingly out of balance with real goods and services. This produces asset bubbles, such as artificially high stock market prices, and artificially high bond prices (because the interest rates on bonds are so low). These assets bubbles lead to investment crashes. Also, if the printing ever stops (and perhaps even if it doesn’t), interest rates will rise, greatly raising cost to governments, corporations, and individual citizens.
11. Globalization encourages dependence on other countries for essential goods and services. With globalization, goods can often be obtained cheaply from elsewhere. A country may come to believe that there is no point in producing its own food or clothing. It becomes easy to depend on imports and specialize in something like financial services or high-priced medical care–services that are not as oil-dependent.
As long as the system stays together, this arrangement works, more or less. However, if the built-in instabilities in the system become too great, and the system stops working, there is suddenly a very large problem. Even if the dependence is not on food, but is instead on computers and replacement parts for machinery, there can still be a big problem if imports are interrupted.
12. Globalization ties countries together, so that if one country collapses, the collapse is likely to ripple through the system, pulling many other countries with it.
History includes many examples of civilizations that started from a small base, gradually grew to over-utilize their resource base, and then collapsed. We are now dealing with a world situation which is not too different. The big difference this time is that a large number of countries is involved, and these countries are increasingly interdependent. In my post 2013: Beginning of Long-Term Recession, I showed that there are significant parallels between financial dislocations now happening in the United States and the types of changes which happened in other societies, prior to collapse. My analysis was based on the model of collapse developed in the book Secular Cycles by Peter Turchin and Sergey Nefedov.
It is not just the United States that is in perilous financial condition. Many European countries and Japan are in similarly poor condition. The failure of one country has the potential to pull many others down, and with it much of the system. The only countries that remain safe are the ones that have not grown to depend on globalization, of which there are probably not many today–perhaps landlocked countries of Africa.
In the past, when one area collapsed, there was less interdependence, so it was possible to let cropland “rest” and deforested areas regrow. With regeneration, and perhaps new technology, it was possible for a new civilization to grow in the same area later. If we are dealing with a world-wide collapse, it will be much more difficult to follow this model.
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hello Gail,
Thank you for posting all of this great information, I am new to this topic but I think reasons 1(Globalization uses up finite resources more quickly) , 4 (Globalization acts to increase world oil prices.) and 5 (Globalization transfers consumption of limited oil supply from developed countries to developing countries.) are actually very positive because they force the long term planners in every society to do more larege scale engery research (thorium (also known associated with Integral Fast Reactor or liquid metal fast breeder reactor) and geo-thermal).
I also think reason 12 (Globalization ties countries together, so that if one country collapses, the collapse is likely to ripple through the system, pulling many other countries with it.) keeps everyone focused on advancing science and technology across all countires, and less likely to start major conflicts about cultural differences.
I know we are talking with many generalizations but thank you for adding so much data to general trends.
bob
Maybe they are positive, but if there really are no solutions, we are pretty much, “up a creek, without a paddle.” I am afraid we end up with a great big crash.
I’m sure people with such firm opinions have looked at the hard data, but for those who might have missed it, the IMF has useful data on emerging economies regarding their financing — bonds, equities and / or loans.
(Source: http://www.imf.org/external/pubs/ft/gfsr/2012/02/index.htm)
Observations: the share of financing, from 2008 to latest data (Q-2 2012) from loans fell from 66.3% to 42.5%; equities were largely unchanged (from 13.6% to 13.8% whereas bond financing rose from 20.1% to 43.8%.
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I live in Asia; we didn’t have a financial crisis. What we had was a trade crisis — sharpest drop in global trade volumes since the end of WWII.
Why? Because we got stung in 1997-98, and since then have largely shunned foreign borrowing.
Thanks for the link!I haven’t done much with debt outside the US, so hadn’t looked for that kind of thing.
probably the most fundamental (and least discussed) problem with land and food production from it, is that we break the recycling loop that nature has developed.
We grow food, but we eat it away from the land it grew on, therefore our body wastes (produced from that food) are not returned to the land that grew the food.
We are the only species that does this.
Our bodies produce enough waste to grow sufficient food for our needs, ultimately our bodies are intended to supply sufficient food for other creatures needs. gruesome I agree, but nature is just that–gruesome.
our own bodies are intended to be returned to the land from which they derived sustenance, but we either burn them or bury them too deeply for recycling to take place.,
This is why, over time, human habitation depletes the land, whereas animal habitation does not. It also explains why we have to artificially fertilise our farmland, if we did not, it would rapidly become a desert
@End of More (End of More)
If I remember correctly, we bury bodies six feet under in order to ensure that any disease present in the cadaver does not escape and spread to uninfected people in the land of the living. Perhaps with population growth being such a problem, we should reduce the regulation depth from six feet to only one foot. The law of unintended consequences might produce some interesting results!
That is a good point. Living in small communities, and returning all waste to the soil nearby, would largely solve that problem.
The other big problem is soil erosion coming from cultivation. With soil erosion, we lose soil (and scarce minerals) faster than they are replenished (1″ per 1,000 years on average). This creates a huge problem. Without fossil fuels, we can’t import amendments from around the world. These supplies also deplete, and still don’t fix the soil loss problem completely. (Fertilization with animal waste helps some aspects of this, though.) We really need to use a mix that is mostly perennials, that we do not replant.
Mr Arnold,
Further to some of your points above . . . Forget GDP; focus on what really matters.
Globalization raises living standards and lowers prices. It raises literacy and lowers infant mortality. In increases wages while reducing pollution. It increases contacts among people and reduces the likelihood of war.
• No country with an open trading regime has a less stable society and political system than any country with a closed trading regime. Not a one.
• No market that bars imports is populated by people with a higher life expectancy than one that welcomes trade. None.
• All open trading regimes have higher literacy rates for women and lower infant (and childhood, and natal) mortality than do economies that refuse to be part of the global system of commerce. Every one.
As for China, DON’T forget it ! The last 30+ years has seen global poverty decline, in both absolute numbers and in percentage of global population, precisely because of China. If other countries can’t – actually, won’t – take the steps necessary to improve the lives of their people, then it is absurd to simply dismiss the one, or the few, that do take those steps.
China not a good example of “globalization, free trade, open borders?” That is perhaps the most absurd analysis of China’s recent history I’ve ever heard. Total and complete nonsense. If you speak Chinese and understand the business environment and culture, there is no need for a local partner (the same is true in Japan, by the way. And Korea, Poland and Slovakia.) If you know what you’re doing, and you choose to have a partner, the partner doesn’t necessarily get the better deal. But, if he doesn’t get a fair shake, you won’t succeed. Reminds me of Kansas.
China is the world’s second largest importer. Selling into the country is quite feasible, provided that you have products people want at prices they can afford. What’s the best selling shampoo in China (see below)?
China “exploits openness and lack of trade restrictions” ? Gee, I wonder who they learned that from. Oh, now I remember! We insisted that they open their economy and trade. And, they did.
Back to GDP. “Growth in GDP does not necessarily translate into a better quality of live for the average citizens.”
Bull.
Aside from the very few oddities – mainly oil exporters – show me examples where strong, sustained economic expansion hasn’t lowered infant mortality, raised literacy, improved access to clean water, reduced disease and expanded opportunities for women.
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The best selling shampoo in China is called Head and Shoulders . . .
Gr8 article. Just scratchin’ surface. Globalization stands behind merchantilism. As Michael ParentI once said: “…globalization of poverty…”
Gr8 book for theme: Bad Samaritans-The Myth of Free Trade and Secret History of Capitalism. Gr8 writers about problem:Silvio Gesell, Gottfried Feder.
Solution? Cooperatives. Did you know that 1 bilion people worldwide are members of coop. As high total population membership as 70% Ireland, 50% Swiss, Scandinavia etc.
If we could make things just with local materials, co-operatives would be a great solution. In fact, I think I mentioned mutual insurance companies and employee owned consulting firms in another comment. I am afraid, though, that in today’s globalized world, manufactured goods are likely to be a problem. Even locally grown food is likely to depend on imported oil, and on tools made from metal (made elsewhere). So at best, co-operatives are a partial solution.
Dear Gail
‘Even locally grown food is likely to depend on imported oil, and on tools made from metal (made elsewhere). So at best, co-operatives are a partial solution.’
I would like to add some of my recent experiences to your observation. I joined a community garden this year. As I have gotten to understand the garden better, I have run into more and more problems. The garden is built on an old gravel parking lot with raised beds with wooden sides. The beds are filled with compost. The land is laid out with surveyor’s lines and industrial thinking as opposed to watershed thinking.
While gardening with compost is wonderful, gardening in nothing but compost is not a good idea. So for the last few weeks I have been trying to figure out how to mimic Mother Nature’s garden processes in an environment which is decidedly ‘not natural’. The plot has a very high Cation Exchange Capacity, so it retains nutrients, but it is also low in humus so that it doesn’t retain water very well. (How can you get low humus growing in compost? Microbes are apparently attacking the humus.) The soil is low in potash. I tried to start a cover crop but the thin layer on top dries out very rapidly which has not helped germination. I try very hard not to drive around looking for stuff–but I have been doing a lot of driving buying things and consulting people and so forth.
In short, we humans made a ‘not natural’ environment and I am paying the price in terms of trying to manage that environment back into some semblance of what Mother Nature wants. My own yard was abused by the developer, but it was still close enough to Nature that some fairly easy management has it largely self-sustaining and productive.
Then, last evening, I watched Allan Savory’s TED talk on desertification in the grasslands of the world:
http://www.ted.com/talks/allan_savory_how_to_green_the_world_s_deserts_and_reverse_climate_change.html?utm_source=newsletter_daily&utm_campaign=daily&utm_medium=email&utm_content=button__2013-03-04
What I draw from his talk is that if humans make fairly simple substitutions in Mother Nature’s scheme (cattle instead of wild herbivores, humans instead of lions), we can pretty easily get a surplus which can feed us. But if we fail to keep Mother Nature’s methods, then we are very likely to produce the deserts that Allan shows.
Much of the complexity of trying to make a human designed grassland meat production system lies in the water management area. Mother Nature had it all figured out a long time ago. Humans resort to more and more manhandling (trips to the store?) as they struggle against the forces they have unleashed. In my community garden, we are currently struggling with water because we cannot apply Permaculture water management principles. So we resort to things like rain barrels and solar pumps and more trips to the store. My side yard uses swales and mulch–which don’t require trips to the store.
In short, my experience is that staying as close to Mother Nature as possible while also nudging Mother Nature in a direction which gives you what you need is the only ultimately feasible thing to do.
Don Stewart
It seems like staying close to mother nature often requires more land and more time. It also requires allowing a mix of plants, some of which do not provide human food. Insects and animals are other visitors are also part of the natural landscape, but are eliminated by modern techniques. This allows us to feed a much larger number of people on the same land. This is an academic article that talks about much greater land use in years past, for this reason. (Also slash and burn type of land clearing for fertilization.) The Anthropocene
Gail
I didn’t buy the article. But I do agree that humans had a very large impact on the Earth well before the industrial age. Consider, for example, the evidence that Albert Bates marshals that the native peoples in the Amazon created the Little Ice Age by sequestering so much carbon in Bio-Char. Could we do a similar trick today? Yes, if we got our act together. But Albert doesn’t think we will get our act together. And so when he travels, he plants trees to offset his carbon footprint.
More broadly, I think we need to examine statements such as ‘food is just fossil fuels’ with a critical eye. There is no doubt that fossil fuels have enabled us to change many things relative to food. For example, shipping Chilean grapes to the northern hemisphere in the spring, or wrapping tomatoes in cellophane. Or cooking on a gas stove. Fossil fuels have permitted the destruction of most farm land within easy reach of New York City.
In my oft-expressed opinion, we should first make a distinction between gardening and farming. Gardening is mostly about growing perishable foods on one’s own land very close to home. Farming is about selling mostly non-perishable foodstuffs to distant people that one does not know. The farmer’s product will be things like wheat, while the gardener will produce leafy greens. These products are not at all like each other, in functional terms.
We should also beware of the fallacy that ‘modern is better’, which is thoroughly dissected by John Michael Greer in his new book Not The Future We Ordered. The Iowa State trials showed that, in terms of On The Farm Productivity, high fossil fuel farming is no better than traditional farming and generates a lot more pollution.
That is, the things that are usually pointed to as fossil fuels contributions to increased productivity are really not any better than cover crops. Cover crops can fix nitrogen, stop erosion, encourage the soil food web, conserve moisture, bring nutrients up from deep in the soil, add organic matter to the soil, and do double duty as edibles. Fossil fuel derived products can do some of those things, but not all of them. So farming with cover crops is sustainable, while farming with fossil fuels is not.
It is true that modern varieties of corn and wheat and other staple crops are much more efficient users of solar energy than the crops of 500 years ago. When we examine old Flemish paintings of workers harvesting crops in the field, we find that the crops towered over the workers. We now have varieties which put more energy into the seeds that we are interested in and less into foliage. It could be argued that it was a fossil fuel powered society that invented the modern varieties. Perhaps so, but we should remember that the native peoples in the Andes developed hundreds of varieties of potatoes without benefit of fossil fuels.
My conclusion is that fossil fuels enable us to take terribly degraded land and do something with it quickly (which tends to give us the 75 dollar tomato), and to do a lot of things (many of which are not wise) after we harvest the crop. Which circles me back around to gardening. The best strategy for a fossil fuel limited world is to have a garden in soil you have rendered fertile and to have learned how to garden with a minimum of inputs. One should also have learned some tricks about preparing and preserving foods in a low energy world, because preparing and preserving use more energy than producing. Packaging and marketing and the other BS that we seem to find essential nowadays should simply be eliminated.
As for the New York City which ate its farmlands rather than the food its farmlands could produce–good luck with that strategy!
Don Stewart
The thing that bothers me about the model of farmers in the country shipping non-perishables to customers in the city (who grow their own perishable food) is that it assumes today’s supply approach will work. We know it will cease to work at some point (because it is dependent on roads, and trucks, and oil for the trucks, and banks to pay the drivers of the trucks). The system works until it doesn’t. If we plan this way, we have a fairly fragile system for the longer term, even though it may work now, and for the next few years.
Gail
The way I look at it is that several conditions have to be met. Among them:
1. Whatever a farmer does right now has to be economically viable for the next 2 years or else the farmer won’t survive for the next few decades.
2. Climate change is going to change the specific adaptations which are going to have to be made in order to survive but our ability to predict those adaptations is not very good.
3. Non-perishables can be stored for shipment at the time of year when the roads are in their best shape. Right now, the non-perishables are mostly harvested in summer to fall, and shipped in the fall, when the roads are the driest.
4. Non-perishables are adapted to water transport, which is likely to become increasingly dominant. If trains survive, then trains will continue to transport a lot of non-perishables.
There certainly are no guarantees on anything. We could have a new set of Jesse James and Dalton Brothers gangs who hold up trains to get the corn and wheat–let your imagination work a while and you can come up with all sorts of scenarios which take us back to isolated homesteads pretty quickly. But isolated homesteads will look like the one Wendell Berry described in Kentucky at the end of the Civil War–struggling to stay alive.
Also, compare Ugo Bardi’s current post on the sad state of Italian politics and James Howard Kunstler’s guest article for Chris Martenson. Bardi notes that when coal became available in northern Europe, waterways were improved in order to move the coal which led to the industrial revolution in those countries. In Italy, only the north (the Po Valley, I assume) had navigable rivers or terrain suitable for canals and so southern Italy remained a backwater which was conquered by the Piedmont kingdom with the help of the British.
Kunstler does describe the importance of water, but I don’t think he has really thought it through. He talks about ‘localization’–without contemplating that the people in next valley were frequently strangers in a world of poor transportation. In Europe, one could have completely different languages over in the next valley.
The ‘neighborhood’ of the future might be defined in terms of the distance one is from navigable water. Eastern China has always been threaded with thousands of miles of canals. A famous old drawing in China depicts the ‘Emperor on the Grand Canal’. So getting trade goods from eastern China to New York City may be easy. Getting trade goods into Manhattan from Morristown, NJ, may be really hard. During the time Washington’s army spent at Jockey Hollow just outside Morristown, it was the bad winter roads that protected them from the British army in New York City. But communication between the British army in NYC and London worked just fine.
In short, if we go far enough into the future, I suspect we will relearn the importance of navigable water.
In either event, I think that a near term adaptation which thinks and works in terms of the distinction between perishables and non-perishables is most likely to be commercially viable and also to be adaptive physically.
Don Stewart
Maybe so. It is hard for people to plan for a future different from today, though. Even though we could use more water transport, it will take a while to ramp up. Our current water transport is geared to oil powered boats. If oil isn’t available, we will need to make a change.
The amount of non-perishables transported will need to depend on the amount of transport really available. Grain is pretty compact, so hopefully we can transport what is needed.
Gail
Let me reconsider my statement about Morristown, NJ to NYC. The newly independent United States constructed the Delaware and Raritan canal which connected those two rivers and thus New York City and Philadelphia. I am not a student of the canal, but I imagine it carried a lot of fuel such as coal and also a lot of staple agricultural products from the rich farmlands of New Jersey. I believe it operated until about 1960. When I used to take my children walking on the towpath, or canoeing on the canal, it was in pretty good shape. The locks still worked. So my guess is that, sometime in the not too distant future, that canal may assume new importance. However, the ‘rich farmlands of New Jersey’ are mostly no more–turned into Suburbia. If you look at maps, you will find that the ‘improved farmland’ which used to ring NYC has mostly disappeared. And canals are not very good for transporting perishables such as leafy greens grown on suburban lawns in the absence of refrigeration because the mules just move too slowly.
Still, I think the point about water making close neighbors more so than mileage is still a good thing to think about.
Don Stewart
Good point!
Gail
I also recommend Albert Bates’ current post on the Research Farm in Belize:
http://peaksurfer.blogspot.com/2013/02/returning-to-deep.html
It would be a mistake to say that the Farm is merely going back to what the Mayans did. It would be accurate to say that the Mayans knew some things which the Europeans did not know and could not appreciate. It would be accurate to say that the Big Ag companies despise everything that is going on here–because it makes them negligible amounts of money. One can currently make more money in the short term with extractive agriculture (treating it like a mine).
The first European farmers in my county in North Carolina used extractive techniques for 15 or 20 years and then moved west. The county would look entirely different if the first Europeans and every succeeding generation had thought and acted like the people at this Farm.
You have commented that economists make a big mistake by discounting the future so that the results of current actions which show up in 25 years are essentially irrelevant. If one reduces the discount rate to zero, then planting the big trees which will take decades to mature on this Farm makes perfect sense. Their goal is a juvenile forest–not a pristine old growth forest untouched by disturbance; not a perpetually disturbed, freshly plowed field of annuals. Juvenile forests are most easily managed with reasonable amounts of labor and are highly productive. A medium term swidden system fits into that goal in many locations in the world. By focusing on maximum utilization of solar energy and nutrient retention and carbon storage and water management, this Farm is behaving admirably in terms of a zero discount rate world.
Can it feed ten billion people? That is simply the wrong question. The right question is: Is this method of agriculture regenerative? If the answer to that question is ‘Yes’, then we need to do it. Then maybe we can intelligently think about the question ‘How much surplus can it generate for humans?’. And when we get really skillful we can ask ‘How can we generate even more surplus for humans without harming the regenerative capacity?’
Don Stewart
We do need systems that regenerate themselves. The question that arises is whether people can be persuaded to leave them alone if the trees, say, will provide some wood in 10 years, even though they won’t mature for 20 years. Wood today will always have more value than wood tomorrow, if the difference is not being able to do something essential (keep from freezing, cooking one’s food, or making a product to sell). If the alternative is not being alive in 10 years, the discount rate will be very high, as much as we would like to change the situation.
Gail
Here is another aspect of globalization that bears some thought. There is now strong evidence that sugar independently promotes diabetes:
http://www.plosone.org/article/info:doi/10.1371/journal.pone.0057873
And the authors tested the notion that reductions in sugar usage could reduce diabetes rates. They found:
We found that in the periods after a country lowered its sugar availability (typically in the context of changes in trade agreements, discussed at length elsewhere, [38]), diabetes prevalence reduced by 0.074% (p<0.05), after correcting for changes in all other controls including the economic variables, socio-demographic variables, and changes in consumption of other food products as well as total calories and obesity prevalence
Consequently, we can conclude that global trade facilitates the spread of toxins such as sugar.
Don Stewart
I saw that article.
Maybe we can partially offset the effect by eating turmeric. We usually get that by international trade as well, but I understand that it will grow as far north as Zone 7b, which Atlanta is in.
Gail
Charles Hugh Smith, stealing from someone else, has recently been commenting on ‘inappropriate scales’. For example, nation states are the wrong scale to solve certain problems while corporations are the wrong scale to solve other problems.
Last Sunday’s NYTimes magazine had an article about the scientific discoveries which made it possible to precisely formulate addictive junk foods. A globally active corporation is precisely the right scale to flood the world with such addictive junk food. National governments are, for a variety of reasons, not the right scale nor have they the right structures to do much in response. A nimble corporation can quickly addict a couple of billion people, while democratically responsive national governments are going to be very slow, or glacially slow, in responding by removing the addictive substance. In theory, a corporation can also spread solutions, but solutions don’t usually make the kind of money that feeding addictions can make. On balance, I think that the evidence of worldwide deterioration in terms of chronic diseases supports the notion that, in terms of chronic disease, globalization has been a negative.
Don Stewart
I think you are right.
It seems very likely to me that the changes in food that people eat since 1970 have to be at least partly responsible for the rise in obesity. International corporations selling grocery products played a big role, but so did the growth of fast food chains and restaurant chains. Sitting behind desks more hasn’t helped either.
International corporations come up with ideas as to what will sell, and national governments (at least ours) doesn’t try to err on the side of caution in protecting the consumer.
Another factor in the rise in obesity might that when people are unhappy, they seek comfort to compensate and the most easily obtained comfort comes by way of food. This is especially so when the unhappiness seems to be caused by life in general, rather than something specific, such as a failed marriage.
Treating the symptoms rather the underlying cause will not succeed in the long run. When one looks at the work-life balance of the citizens of modern developed societies, it is difficult to avoid the conclusion that somehow the human animal has taken a wrong turning somewhere. As I am writing this, there is a discussion on the radio in which the two interlocutors (senior politicians) agree that globalisation and especially its ability to influence people from ill-defined, remote locations is a major source of people’s unhappiness.
We cannot expect to get good governance from those returned by a democratic system that is going to reflect a significant and rising protest vote, as is reflected in the support the Italian comedian managed to muster in Italy’s recent general election. This gives me food for thought, but not of the kind that causes obesity.
One issue that we don’t hear discussed much now is the fact that making something where you can see the end product gives a great deal of satisfaction. I think this is part of the reason handicrafts are so popular as a hobby for women. (I suppose writing a blog has some of these aspects as well, even if the end product is only pixels.)
Years ago, I talked to someone who had come from a long line of people who had worked with their hands–I suppose farming, and then making something like furniture. This particular individual was now working in an office, and didn’t feel like he had a “real job,” that provided the kind of satisfaction he expected.
My father went into psychiatry after many years as a general practitioner. He liked very much being a general practitioner. He would see the same patients over and over, and treated them for illnesses that went away. He didn’t like psychiatry nearly as much. He would dispense pills to a changing group of people, and the changes he saw were very much less dramatic. But specialization was the way medicine was going, and the government would pay to send him back to school to learn to be a psychiatrist.
We seem to be in agreement, Gail.
My apologies for commenting under my old ‘funglestrumpet’ name. I was not trying to play glove-puppets. (My true identity, along with that of many others, was revealed by a hacking incident at another website that I comment on from time to time.)
Xabier,
Argue the points, not the people. Reducing poverty isn’t important enough, to you? How sad.
Re Luddites: I’m familiar with the literature of the results of the industrial revolution. Are you?
Show me a farmer, 19th century American or 21st century Bangladeshi, who would rather continue to work 12-15 hours days in all kinds of weather, rather than earn many, many times the pay in a factory. Sure, there are individuals who want to farm, but they are all – all of them – in rich societies.
Over the last 30+ years, I’ve watched from very close the transformation of farmers into workers, workers into managers and managers into business owners. I’ve seen both sides of it, the environmental cost and the soaring standards of living. And, I’ve never met a single person who lived through that experience who thought it might have been better if he or she had stayed on the farm.
Not one.
I’m not convinced meaningful capital is being formed. Much of recent world progress seems to be debt based.
The problem with credit expansion is that it can turn on a dime, as Xabier states. It is not organic growth in income. One moment you are on top of the world, the next you are destitute.
If the crisis which started abruptly in 2008 cannot convince you of this, I am not sure what can.
The world should have long ago dealt with the population problem, with measures far more draconian than China’s one child policy. We should have simultaneously taxed fossil fuel consumption, so genuine capital could be formed by energy production and conservation.
What really concerns me is what will happen to the internet. Hopefully the internet will remain in some form or another for awhile, as it is the only thing which allows us to discuss these things openly. I’m afraid none of this is palatable for dinner party conversation or mainstream newspapers and magazines.
Hard to say what “meaningful capital” really is. To me the most “meaningful” capital is education — and, yes, education really is a form of capital. After that comes durable infrastructure for housing, transportation, communication, and public health. After that come factories and tools. I don’t know what being “debt based” has to do with any of that.
A large part of China’s rapid growth in GDP has been from spending on infrastructure projects. That’s something we in the US have been unwilling to do, regardless of need. It means government spending, anathema to most Republicans.
Xabier,
“How is this process of enrichment being fuelled?” About the same as in the US in the 1920s, with an adjustment for population size and density. Not perfect, but successful.
The elimination of poverty isn’t just an admirable idea; it is in the works, and while it may never be 100% finished, the progress is stunning. We are experiencing, right now, the greatest increase in standards of living, for the most people on earth, at any time in human history.
Go back and read that last sentence again.
• Billions of farmers have become factory workers, and their children can expect to go to school, and maybe find a job working with their brains, rather than their backs.
• Cheap and readily available global communication is now possible in places barely connected with neighboring villages only a few decades ago.
• Women are slowly winning the right to own their own property, to make their own decisions about marriage and work and to expect to see their children grow, learn and live a better life.
• Most important of all, through the poverty eradicating power of globalization we are making it much harder to reverse our way back into protectionism, confrontation and war.
Worldwide, the number of people living below the poverty line is today 500 million fewer than it was 30 years ago. Much more impressive is that this represents a decline from one-half of the global population to one-quarter.
In India, the share living in poverty has declined from 60% in the 1980s to barely 40% today. In China, there are 650 million fewer people in poverty, an absolute decline of more than 78%.
We are winning the war on poverty, but we don’t seem to acknowledge it. Because of 24-hour news and the always–on internet we know much more about greater portions of the world.
We see the problems more clearly, and so they seem larger. But, the fact is that we have turned the corner, and peoples lives are changing, for the better.
Gail Tverberg,
Jobs aren’t disappearing; rather, they are appearing in places where they are sorely needed. Remember, workers are workers, regardless of race, nationality or location.
I’m afraid that your analysis is that of a One-Issue observer, true up to a point. We are discussing a much more complex situation than the mere ‘elimination of poverty’.
Another word for this perspective of yours is, I’m afraid, tunnel-vision. People talked like this in the 19thc when they contemplated the benfits of industrialism: you might try reading some of that literature, so full of somewhat naive excitement and hope, backed by statistics – it’s salutory. They missed the environmental calaculation, too. ‘People are being fed, clothed, have gas light, trains to travel on, how wonderful!’ They also said things like: ‘We are so interdependent now (c 1900) it would be irrational to go to war……’
Yes, many people are leading what seem to be objectively better lives. But you could also look at it like this: a rich friend with whom I was at College invites me to a top-class restaurant in the smartest district of town. Feeling rather shabby, I borrow some money to buy some smarter town clothes. I feel safe in doing this, as business is, if modest, good, based on clients who themselves live off credit but who are reasnably confident. Their limousine picks me up at the station and I am wafted to the restaurant. The meal is superb, sourced from all over the world; we relax with post-prandial cognacs, the world seem rosey. This is where one should be, this is modern life! We think of our peasant grandmothers and toast them: if only they could see us!!
The next week, my modest business goes bust and I can’t meet my debt obligation, incurred for a few hours of pleasure, as my clients get swept up in a sudden financial collapse. My rich friend goes bust as he didn’t believe such a thing possible and made no practical preparations feling rich enough to face anything. Instead of fine wines, we now drink water of doubtful quality and colour from an intermittent supply, and stand in line at a food bank, our good clothes are inappropriate to the new situation…..
And the point is, that is where modern life led us, directly; to a position no better than or even worse than that of our peasant grandmothers.
Many people in the world have been invited to a feast which will seem like a dream or fantasy when they awake, rather abruptly. We are perhaps at the tail-end of a great Delusion which has lasted some 200 years.
That is a good way of describing the situation. You might call the situation of the last 200 years a temporary bubble.
the industrial revolution has been a flash of light in the million years of our existence
“the industrial revolution has been a flash of light in the million years of our existence”
I am afraid you are right.
David,
I’m as eager as you or anyone else to see the reduction, and if possible the elimination, of global poverty. It’s for pragmatic as well as moral reasons: higher standards of living and opportunities for women, in particular, seem to be the only benign way to curb population growth. The alternative is genocide. That has undesirable side effects.
I’m less sanguine than you about the extent or durability of the gains in recent decades. I think some statistical measures would support your case, but those measures are dominated by GDP growth in China and handful of other rapidly developing nations. Growth in GDP does not necessarily translate to a better quality of life for average citizens. The 90/10 rule of thumb applies: 90% of the gains go to 10% of the population.
It’s also ironic to see China being cited as support for globalization, free trade, and open borders. China is far from that. If you want to do business in China, you will have to partner with a Chinese company, and the deal you strike will be structured to benefit that partner. If you want to build a factory to make products that will be sold primarily to foreign markets, approvals are easy. If you want to sell products made outside of China into the domestic Chinese market, good luck.
I don’t fault China for its policies. They make sense for China. But they aim to create exactly the sort of protected environment that I said was necessary in order to support endogenous economic growth. They exploit openness and lack of trade restrictions in the nations to which they export, but it is not a two-way street. It is almost the antithesis of globalization for the domestic Chinese market.
One other point worth mentioning: recall the pre-revolutionary China was long the victim of the type of exploitative forced globalization that I lamented in a prior comment. You probably know about the opium wars and the Boxer Rebellion, but anyone who doesn’t should look them up.
All of this is peripheral to the deeper economic issues of job creation in a time of rapidly increasing automation, or the collision between economic growth and finite resources that Gail writes about. I’d love to get into those, but it’s far too much for one comment.
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Mr Arnold,
You’re right: it is the lack of good jobs that keeps people in poverty. But, there is a huge market for their labor – the experience of China in the past 30 years proves that beyond any doubt. All we, and their own governments have to do is to stop blocking the way.
Closed borders undermine job creation.
Open borders encourage and facilitate job creation.
If globalization isn’t about letting people raise themselves out of poverty, why bother? After all, it is far easier to sell goods and services or invest next door, with my neighbor, than with some stranger half way around the world.
But, globalization offers so much more. It improves people’s lives like nothing else we’ve ever encountered. This ranks up with capitalism, the industrial revolution and the end of the tyranny of distance as one of the most important poverty eradication tools available to mankind.
Many good points, but perhaps not going very deep at all. The point is: how is this process of enrichment (which is perhaps more apparent than real or durable) being fuelled?
You seem reluctant to grasp the implications of this: many are.
Globalisation is in itself an interesting concept and reality, but how does it really function here and now?
The elimination of poverty, admirable an ideal as it is, is perhaps not the highest human purpose… (I say this as someone who has been both cold and hungry, and lived in great luxury and privilege in both the terms of our society and historically considered – I’ve seen both sides of the coin, though admittedly not developing world destitution.)
Consider the Soviet Union and its economy: setting aside the privileged caste, it delivered equality in access to goods, housing, heat, food, clothing, etc, to all. This was in stark contrast to the unequal traditional society before the revolution, and to the horrors of the civil wars: many in the 1930’s in the Soviet State, and outside, thought they were indeed saving humanity – but we know now of the terrible environmental cost of all of this.
If there are limits in total, globalization helps us reach them more quickly.
Jobs disappearing being replaced by a cheaper source aren’t necessarily replaced either. Richer countries find themselves going downhill quickly.
The trend in the US, Britain, Japan, and Europe in general is for the majority of people to find new jobs at much lower wages, and often under-employed. The unskilled, the older workers, never find anything.
There is a steady and unremitting deterioration in progress.
These peopls and their families are then very vulnerable to the next economic shock, have fewer resources to prepare with, and so on.
In Argentina, skilled workers and managers became taxi drivers and storemen after the Crisis, then those jobs ceased to pay, and the growing generation turned increasingly to crime to survive, and drugs to assuage the pain of collapse: a cycle of about 10 years.
Now, does the creation of factory slave jobs in China really seem a hopeful development when this proces of destruction is occuring in the West (and indeed in Japan)?
It is sad, the way things are going. It becomes difficult for the older generation to depend on the younger generation, because the younger generation is having so much difficulty finding good-paying jobs.
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The world suffers from too much of everything. So much so, that even the hint of less is met by thoughts of collapse.
I’ve lived a middle class American life filled with so much goods and travel, that now the only thing I want is to be left alone, and nobody understands it.
I’m afraid the biggest bubble of all is the global human economy. There’s no stopping this train from reaching the end of it’s track. When it does, we’ll go off.
Humans, like every other creature, are a species born and refined through scarcity. It is always thus. And we came upon this bonanza called fossil fuels, and the rest is history.
It is hard to look at a graph of human population growth, and not be concerned.
That chart is why I am moving to a remote mountain top with the lowest population density I could find…..Also overlay oil consumption over the population growth and they mirror each other. I believe high oil prices will destroy industrial civilization long before we ever run out of oil; I think oil extraction is in the end game right now. Imagine what happens to the population chart should oil production crash because oil became to expensive to generate new growth necessary to run industrial civilization.
End of More,
Energy input is necessary for just about everything that happens in the modern world; globalization isn’t so special that this needs to be highlighted.
= = = = =
Mr Arnold,
Which world? My 30+ years of travelling around and living and working in different parts of the world tells me that relaxing – not eliminating, but rationalizing – controls over the flow of goods, services, capital people and ideas is the root cause of prosperity among less developed economies. The reverse is also true: no opening, no prosperity (anyone know of a counter example?).
Which is, of course, the majority of the world’s population. So, unless this is an elitist discussion, and the futures of the majority of the people are simply outside the parameters, that definition is exactly what globalization means. The “lumpy distribution of productivity” to which you refer is a reflection of barriers to interaction.
Oh this one, for sure.
I didn’t say that everybody had all the “stuff” that they could possibly need. There is extensive poverty, but at this point it’s more a consequence of, rather than a need for, more efficient means of production. People living in abject poverty go hungry, not because highly automated factory farms can’t produce food that’s cheap enough for them to afford, but because they have no jobs that would enable them to buy what those of us blessed with jobs can easily afford. There is no market for their labor.
You speak of relaxing or rationalizing controls over the flow of goods, services, and capital (capital including people and ideas) as bringing prosperity to less developed economies. You seem to feel that that is what globalization is all about. I’d say that sometimes it is, and sometimes it’s something else.
Governments in less developed nations are often corrupt, and the corruption tends to be rooted in alliances of convenience with large multinationals. The multinationals get favorable lease terms for the resources they extract, lucrative contracts for projects, or exclusive access to markets for their particular products. Corrupt officials get kickbacks, covert political support, or license to operate monopolistic concessions involving the corporation’s products.
I think that for the most part, you’re right, that such controls as exist are generally set up to favor an incumbent elite, and that relaxing such controls is often the first step in a liberalization that brings more people into the economy. But it’s dangerous to generalize. The banner of free trade and “open markets” has been raised as the justification for overthrowing young governments that were so impertinent as to place the interests of their citizens above those of the international banking community and multinational corporations.
More fundamental than issues of “free markets” vs. protectionism, however, is the cultural dead end in which we’ve trapped ourselves. The celebration of competition and “winner take all” mentality can work in a world with unlimited capacity for growth. In a finite world, it’s a recipe for disaster.
Maybe you could look at like this:
A man is hungry and chronically under-nourished and dressed in rags. You give him ample food for the first time, gradually building up, and clothe him, etc.
He flourishes. Many others do likewise. It feels and looks good.
But the costs of giving him that food and clothing are increasingly poisoned air, soil and water, and it can only be done by pressing the foot down hard on the resource depletion accelerator (which is what Gail’s statistics illustrate more than anything else.)
In consequence, he will soon be thrust back into his former state, or worse. Is this an advance? In a short-term humanitarian sense, yes….. But one should have a wider view, which is what this site is about surely?
It does have to be highlighted.
there is a widely held view among many of the great and the good throughout the world that energy is just a side issue in dealing with our problems.
globalisation is the ultimate focus of world trade, where you can find virtually identical goods being ‘traded’ between nations just to promote the business of trade itself and fuelburning
This should be emphasized again and again. This is because of the classical economic theory, formulated in the 18thc, that says as one source of power is exhausted another will be found or invented. Many of the axioms of economics apply to past situations, not the 21st century. Also, who likes uncomfortable facts?
Gail; You are The Best. Your insights and ideas, rock. Too bad you can’t give a presentation to our Congress and White House. Petroleum is still way too inexpensive. I recently shopped at Costco in Marina Del Rey, CA. I bought colored bell peppers from the Netherlands, and raspberries from Chile. What does that tell you about the structural inefficiencies built in to the global economy. It won’t be long until the oil age is over. I wonder if Thomas Friedman knows that his book, “The World is Flat”, will soon be obsolete? And that he will have to write a new one titled, “The World is Round Again”.
THanks! One thing we can do is enjoy what we have now.
Change is what gives rise to new books, and an opportunity for authors.
Globalization – the freer flow of goods, services, capital, people and ideas – primarily benefits consumers. It lowers prices, raises incomes, promotes transparency and more evenly distributes wealth across the world by providing better jobs.
Compared to more closed societies, countries that are more open – or, globalized – have higher literacy rates, lower infant mortality, better legal systems, better opportunities for women and better prospects for significantly improving the livelihoods of their people.
The presence of international standards of behavior – labor rights, product quality, environmental protection or whatever – among even a few companies in a less-developed economy raises expectations among governments and populations that local companies will rise to meet the same standards.
At its heart, the anti-globalization mindset is anti-consumer, anti-poor and anti-people.
You can only have globalisation if you have the energy input to support it
the first explorers took 2 -3 years to circumnavigate the world, and most of them died. Later, when trade got going you could only import export goods which could survive long sea voyages, and maintained a high retail value—basically metal goods, spices, sugar and above all people.
Now we can enjoy the idiocy of asparagus flown in overnight from Peru or wherever, . in effect this is providing income by burning oil but millions are convinced that this is a ‘sustainable economy’ through international trade, and that money changing hands brings physical wealth. It gives an illusion of wealth, nothing more, because we have to continually burn oil to support it.
When the oilburning stops, any form of globalisation stops
Long distance transport with modern container ships isn’t very oil intensive – it gives really very good economies of scale, by only adding 1 or 2% to the price of a product. Ships are by far the most energy efficient means of transport. So ocean shipping (per se) would be the part of globalization that could most easily be continued far into an age of expensive energy. More problematic is the production process in the exporting countries: resource depletion, environmental damage, worker exploitation etc.
Up until now, globalization has worked well to mask inflation and poverty in western consumer societies, and to maintain our way of life with cheap products. A pair of sport shoes made in Europe or the United States would cost several times the price of one made in Asia. In this sense, globalization really made everybody more “wealthy” – for the moment…
Globalization may in fact stop because of a different break in the system (financial in particular). Lack of oil may be the result of the same break in the system. So while what you say (When the oilburning stops, any form of globalisation stops) is true, it is not necessarily a decrease in oil burning that stops globalization. It may be high oil price that messes up the finances of governments and keeps wages down.
0bviously there will be a number of reasons why oilburning stops, I don’t think it will be a shortage of it, I’m inclined to think it will be increasing conflict over what’s left because nations will recognise that their future–in every context–depends on getting hold of it.
Oil shortage therefore becomes a threat to national security, and without exception threatened nations attack the perceived threat.
Japan attacked the USA in 1941 because of the threat to its supply of resources, the USA has been involved in the middle east for 100 years at an escalating rate because of threats to resources.
This only puts off the inevitable of course, because oil will diminish in availability, and price will rise, but that still won’t stop nations fighting over it it, because leaders react as they always have, not realising that this is the endgame.
I am afraid you are right about the continuing conflicts. Having abundant fossil fuel resources for a while led to a reduction of conflicts, but these are likely to escalate in the years going forward. Conflicts seem likely to reduce oil availability, especially for the world as a whole. One particular buyer may gain exclusive access.
That’s certainly the conventional economic wisdom. It isn’t exactly wrong, but it applies to different world with different problems and priorities than we face today.
Conventional economics assumes that productivity is a scarce asset, and that the greatest good is served by maximizing productivity. Thus regional groups should focus their capital development within areas in which they have the resources to excel, and thus become preeminent suppliers for the goods or services in which they have specialized. The various groups then trade among themselves, with everybody benefiting from the efficient productivity that specialization enables.
For a long time, that was a fair model of the world. But today, our problem isn’t lack of production; it’s the “lumpy” distribution of productivity and its consolidation in ever smaller fractions of the population. It takes ever fewer workers to produce the “stuff” that we actually need. So we invent new needs and ways to keep people employed within the economy. But it’s increasingly difficult, and the results are not always pretty. Homeland security, for example, has unlimited growth opportunities. Just wait until the TSA starts policing bus stations and truck stops.
Unfortunately the world is finite. Globalization leads to a dead-end. Things temporarily look better, but then fall apart. We would have been better off if we had focused on birth control and local development.
Hi Gail,
You have often expressed the opinion that current and projected global human population levels present a major obstacle for most strategies designed to avoid serious problems coming down the road (and I completely agree with you on this point). According to a recently published Why we need more people book, we are dead wrong. Here are parts of the book’s promo:
“Look around you and think for a minute: Is America too crowded? For years, we have been warned about the looming danger of overpopulation: people jostling for space on a planet that’s busting at the seams and running out of oil and food and land and everything else.
It’s all bunk. The “population bomb” never exploded. Instead, statistics from around the world make clear that since the 1970s, we’ve been facing exactly the opposite problem: people are having too few babies. Population growth has been slowing for two generations.
[the book] explains why the population implosion happened and how it is remaking culture, the economy, and politics both at home and around the world. Because if America wants to continue to lead the world, we need to have more babies.”
Although the author’s background makes it clear that he is trying to justify an agenda, he gets plenty of support from like minded folks. However, I noticed a fellow bicyclist who made this comment:
“By Frosty Wooldridge (Louisville, Colorado)
As a six continent world bicycle traveler, I witnessed firsthand the human overpopulation predicament now manifesting all over the planet and in the United States. Over 18 million humans starve to death annually from lack of food. Our oceans suffer acidification from carbon emissions, over 100 species suffer extinction DAILY at the hand of human encroachment and we pollute the land, water and air 24/7 with over 80,000 chemicals. Our mega-cities like New York, Los Angeles, Chicago and Houston suffer horrible gridlock and air pollution. Climate change and disasters like Katrina and Sandy are caused by our carbon footprint from fossil fuel burning. We’re also running out of water in six states. We diminish arable land with added population. Places like Tokyo, Japan may be compared to a human beehive where human life squashes over itself. The facts: humans add 1 billion of themselves every 12 years on their way from 7 billion to 10 billion in the next 37 years. America heads toward a projected 137 million added Americans by 2050 and 625 million by 2095. Hardly a birth dearth! I will share this quote: “If we don’t halt population growth with justice and compassion, it will be done for us by nature, brutally and without pity – and will leave a ravaged world.” ~Nobel Laureate Dr. Henry W. Kendall
Last’s book works more on emotions and myth than it deals with reality. We do not need more human population, but in fact, we need to decline all human population to less than 1 billion before Mother Nature starts taking us out in greater numbers. Overpopulation is humanity’s gravest predicament in the 21st century and we either solve it gracefully or Mother Nature will make a fool out of Last’s foolish book. Frosty Wooldridge, 6 continent world traveler”
Frosty was clearly in the minority of people reviewing and commenting about this book (very few people liked his review). This illustrates just how difficult it is to advance any meaningful discussion of human population levels.
I think since the 1930’s , if you mention the Population Question, you get treated as a kind of Neo-Nazi eugenicist: there is a definite mental block. The One-Child policy in China and the consequent killing/abduction of females has given it a bad press, too. One can see the biological reasons for rejection: it’s a menacing concept which touches the individual directly, whereas global disaster caused by over-population seems comfortably distant to many. Bringing up population control is the best way to kill a conversation and lose credit as a civilized person. People love their blinkers…….
You are right. It is hard to get people to believe that we have a problem, or if they do, to believe that it would be a good idea for them personally to do something different. Children are important to families. Couples who don’t have children don’t fit in well.
So, to summarize:
1. Current and projected global human population levels preclude all humane strategies for a broad based mitigation of our impending decline/collapse although some individual strategies may benefit a few.
2. It’s socially unacceptable to discuss the need to significantly (and humanely) reduce our numbers over the coming decades or century.
3. Raising children is something families enjoy and, currently, having children also provides some broader culturally benefits.
4. Therefore, humanity is destined to suffer some very nasty consequences in this century even though we have the technical ability with birth control to avoid the worst of these adversities. All suggestions of broad based solutions to our predicament are useless and only individual survivalist strategies are worth considering because we are unable to deal with our biological imperatives on a broad based scale.
We can still keep trying to get the message of reducing births out, even if prospects for success seem rather limited.
As I remember from a college class, even Native Americans had extensive trade routes. They particularly liked flamingo feathers to wear for warmth (warriors wearing pink feathers is not the image most people have). Also sea shells for flooring. So coastal Indians would trade for higher quality arrow heads that came from the rocky mountains. And I presume since they did not have horses they did this while only riding Indian Motorcycles.
I have always been amazed at the distance Paul and others in the Bible traveled. There was a major trade route already, when Abram set out from Ur of the Chaldees. Of course, if there is major fighting, it becomes hard to do this travel. We also aren’t really prepared, except for walking.
Water becomes the only element on which one may move swiftly and economically in such circumstances. Ability to sail=trade=civilization-advanced society.
But then, so do the pirates and warriors – the Sea Peoples, the Homeric heroes, the Phoenicians of the Ancient World, followed by the Vikings, Norman, Corsairs, etc.
Having lived at one time a ‘localised’ life – due to poverty – just walking into town to get supplies, carrying stuff on my back, etc, energy expended versus gain becomes a major calculation, paticularly when any part of the walk involves winter mud: amazing how deep it gets and slows you down even if only a few people use it, let alone hundreds! If one had to feed an expensive draught animal, it would be an even more important calculation. We can see why our peasant ancestors got stuck in one place and the next village was another country.
You are right I think about people not being able to prepare for major changes in any meaningful way – apartment life, no storage space, no gardens to grow food in, physically softened by the petrol lifestyle: in short, utterly vulnerable with no room for manoeuvre. Preparing for transition seems to me to be a fantasy for 99.9% of people in advanced economies.
@ Xabier
I have about 2 hectares in a rural location, which should be more than enough to sustain me. The problem is that there is a small town eight kilometres away and a city some fifteen kilometres further on. I suspect that if society does collapse, then I will probably not be the one who does the harvesting.
The more we globalise, the more we lose the idea of localism. Surely the writing on the wall is now sufficiently clear for us to start putting in place lines of local supply, with minimal dependence on transportation. If we have a society that operates in a manner that is close to that which will operate when law and order completely fails, then perhaps it will be sustained out of habit even in such times. I cannot see the current global distribution system surviving any breakdown. There are too many links in the chain (think ‘only as strong as its weakest link’) to think otherwise.
In any event, it is unlikely that global distribution of food will survive in a world that is running short of it. The imperative will be for food producers to feed their own citizens before feeding anyone else. I can imagine that riots would result otherwise.
Unfortunately, I doubt that we have sufficient time and governance of sufficient quality to make it happen. (Definition of a politician: Someone who approaches every problem with an open mouth.)
I see you are in the UK. I think the “preparing for transition” movement is mostly as US-Canada-Australia idea, adopted by people who are fairly well off financially. Today’s super-low mortgage rates may allow some more people to buy a little to buy land, but otherwise, younger people, poorer people, and people in more densely populated areas tend to be left out.
Gail
Somehow, I can’t figure out how to efficiently search this sight. My only excuse is old age and decrepitude. So this response is not in the right place.
I said something about new distribution systems for local farmer’s produce resembling horse drawn milk carts. You responded that horses are limited to a 5 mile radius.
Did you ever hear or use the term ‘put on the feedbag’? Then you may know how people used to, and still do in some parts of the world and maybe in Central Park in NYC, extend the cruising range of horses:
http://en.wikipedia.org/wiki/Feedbag
Note that it is possible both to store both oats and water in the bag.
This is not to deny that horses are an expensive means of transport. Walking is far more efficient in terms of calories consumed. But pulling a heavy wagon is best done by horses or oxen and perhaps other draft animals. But it does mean that the Budweiser advertisement represents a pretty lavish expenditure of money in a poor world.
Also, your comment about long distance travel. I do recommend The Old Ways. The author, who is a don at Cambridge, knows an awful lot about the old land and sea paths in Britain. He recounts his travels on the chalky hills of southern England. I believe the hilly paths would stay pretty dry all year. Down in the lowlands, things might be near impassable in winter.
He also has an amazing chapter on an ancient path across a tidal flat on the east coast of England. The danger is quicksand and the fact that the tide comes in faster than a human can run and also the fogs which disorient people in terms of direction. Our ancestors were pretty savvy about getting from Point A to Point B.
The finale is some 5000 year old footprints of a man and a woman walking near some children playing. The footprints were preserved due to sedimentation and the retreat of the sea–now rising seas are revealing new prints annually but washing the old prints away. We even know that the man was over 6 feet tall.
Don Stewart
For searching the posts, the “search” box on the sidebar works pretty well, especially if you can think of a distinctive word. I use it quite a bit to find posts I wrote a while ago.
For searching comments, I have a “search” box, but I don’t think that commenters have access to the same kind of search function. It is on a page that commenters don’t have access to. So I guess to find something very specific, you will have to write to me and ask me to do the search.
Somehow people did get around, at least a bit, way back when. (They also stayed fairly slender, with all the exercise they got.) Ugo Bardi has talked about the fact that landlocked coal often could not be transported very far, even if it was extracted. This a link to a post he wrote: The dark side of coal – some historical insights on energy and the economy.
Gail
Part of the answer on the ability of people thousands of years ago to travel great distances is simply that the transportation system was designed to facilitate travel. Another part of the answer is that people were physically and mentally fit for the challenge.
If you look at a map of my county in North Carolina in Colonial times, you will find that there were inns and taverns at roughly 10 mile intervals. The lodging and food at these places varied widely, but sleeping in the stable was usually possible if you had just a little money.
Roads in many areas were ‘ridge roads’. The old highway near my house was a ridge road up until five years ago when the bulldozers finally forced it through the terrain. A ridge road followed the divide between the watersheds and so had few bridges and few swampy areas–but it was very crooked. In the Ozarks where I once lived, some ridge roads could run for 20 miles with no bridges of any size. They were so crooked one or another of my children was always in danger of throwing up in the back seat.
A ridge road eased the burden on animals pulling heavy loads. But if a river had to be crossed, then a steep downhill and an equally steep uphill had to be managed. These places survive in place-names today: Pulltite on the Current River in Missouri is one–the mules had to ‘pull tight’ to get up the steep hill after fording the river.
In the far north, travel was easier after the ground froze and snow fell. As recently as the 1970s I read a fascinating story about Denison’s Ice Road. A man named Denison built a road on the frozen swamps and lakes going north from Edmonton to the Great Slave Lake. When snow fell, he would send a light weight truck to sweep the snow off the road. Without the insulation of snow, the ice got thicker and thicker. Finally he could send very heavy trucks with heavy mining equipment up to the Lake. The road only existed for a few months in the winter, but it allowed the two way movement of heavy equipment to an area that was quite isolated.
Robert Duvall made his favorite film, Tomorrow, in 1972. It is the story of a Mississippi farmer in the 1930s who adopts, but then loses to the law, a mistreated orphan. In the course of the story, Duvall takes a winter job looking after a ‘gentleman’s farm’ which is 40 miles away. He walks there in one day. A lawyer in the story is astonished at his feat. Duvall thinks it is just normal behavior.
A bicyclist on the Chesapeake and Ohio canal towpath remarked that the woods from Cumberland, MD up to Pittsburgh were full of old industrial structures. I haven’t seen them and don’t know their history. But in a world where transportation is not easy, it makes sense to do the processing near the source of the resource. So it wouldn’t surprise me if what was coming out of the ground was processed to achieve a lower weight and more compact volume. This is similar to Pennsylvania farmers converting their corn into whiskey and their apples into cider–which led to the Whiskey Rebellion during George Washington’s administration.
If you think about a fresh, ripe peach and then think about trying to take it to market on a rutted dirt road in a wagon with no springs, then you see the logic in ‘plank roads’ such as the still surviving name in New Jersey: Patterson Plank Road. You also see why a young man could court a neighbor girl by walking over to her house with a ripe peach.
I have already spoken about water, and it’s profound effect in easing transportation.
If you ever get bored, you can try to figure out how transportation will evolve in the future. It won’t look like the past, but some of those principles may come back in different materializations.
Don Stewart
You are right about the infrastructure being built to facilitate a different level of transportation, and people’s physical abilities being adapted in that direction as well.
I have hiked as small amount near the starting point of the Appalachian Trail in Georgia. I would see people who had walked all the way down the trail, with their big backpacks. I knew I could not possibly carry one, without a lot of practice building up to such a pack.
We have done our hiking when it was wet and when it was dry. It was much more difficult when routes were slippery with mud and streams were swollen so that it was hard to get across without getting very wet. One time I fell and broke my arm, when I was a few miles away from the car. The experience made me thankful that it was’t my leg I broke, and that an emergency room with modern equipment was nearby.
Dear Gail
The book Rebuiilding The Foodshed by Philip Ackerman-Leist, a college professor and farmer in Vermont, has just been published. One of the key issues in the book is defining ‘local’. Does it mean a 25 mile radius, a 50 mile radius, grown in Vermont, or grown in the US? Philip never arrives at any bright line definition.
It occurred to me, as I was reading, that the question is ill-drawn. What we are really after is food which was produced with regenerative methods (regenerative in the sense that soil fertility is enhanced, biodiversity is increased, etc.). And that the fossil fuel demands are very low. (You might make up a few more requirements, but let’s stick to those two).
Wheat coming from Argentina on a big ship unloading in Boston Harbor and making a train trip to Vermont is quite fuel efficient. The most inefficient part of the trip is most likely the part where the Vermonter drives his SUV down to the store to buy his wheat. If he demands that his wheat be baked into bread rather than eaten as wheat berries, then that adds another quite inefficient process. Does it make sense to boycott Argentinian wheat because it isn’t ‘local’? That’s a more complicated question, perhaps, than it seems on the surface because Vermont once did produce a lot of wheat–and may do so again. But I think we can agree that trying to stop ocean freighters from delivering wheat is not a particularly good use of our time and resources.
Wheat berries can be stored for at least a year with no refrigeration. But once the wheat is ground and turned into bread, it becomes perishable. It can be somewhat stored if the bread is frozen, but freezing is an energy intensive process. So a really rational appoach might involve persuading more people to buy bulk bags of wheat berries and cook them as they need to eat them. (That’s what I do).
If we wanted to get our energy costs even lower, we might mostly eat sprouted wheat berries. (I do that also.)
As I noted in an earlier comment in this topic, it is quite unlikely that shipping any leafy green from California to Vermont makes any sense. Therefore, gardening leafy greens in Vermont (perhaps using season extension techniques) plus fermentation (things like sauerkraut) get the seal of approval.
All of these ‘solutions’ assume that a law-abiding society of some sort will survive, that trade is possible, and that some essential tools can be made or salvaged. My thought is that Philip has given us a lot of good information, but I believe the basic question he poses leads us in the wrong direction. We should have some official or unofficial certification of ‘regenerative cropping methods’ and ‘energy efficiency’. Such standards would certainly encourage more production of some types of food not only locally, but also in the home economy. They would not prohibit us from using foods which are adapted to global distribution by water. And they would encourage those growing food to use regenerative methods.
Don Stewart
I should also mention that I am not holding my breath waiting for endorsement of my ideas by anybody who is important. The commercial interests (which includes their champions in the governments) want a ‘marketing wedge’ and they want to ‘add value’.
My local farmer’s market uses three ‘marketing wedges’: the farm must be in a 50 mile radius, what is being sold must be produced on the farm or sourced locally, and a family member or employee of the farm must be present at the stand. These three wedges permit the sellers to charge premium prices reflecting the artisanal content.
We have a ‘goodness grows in North Carolina’ labeling wedge sponsored by the state government, and a ‘Piedmont Grown’ cooperative labeling effort.
Much of the effort in terms of ‘local finance’ is going into ‘value added’ such as artisanal bakeries and breweries and cheese making operations.
While I like to talk to the actual farmer who grew my food as well as anyone, and I do appreciate the farmer’s market enforcing their standards, my thoughts on regenerative practices and truly energy efficient methods of food production, distribution, and preparation are not going to make any friends for me. It is about like selling clotheslines at a convention of dryer manufacturers. My proposals do not increase GDP, so do not permit debts to be repaid, require the reconstitution of the home economy, and lead generally to a very much simpler lifestyle affording much reduced opportunities for entrepreneurs to make a lot of money. My proposals do involve trade–but mostly between neighbors. I doubt that the farmers market, as now constituted, could survive because it is fuel inefficient. (Ackerman-Liest discusses that problem and describes some alternatives–which look like the milk routes those of us who are ancient may remember.)
If nobody in power is going to like it, why even bring it up? It may be that adopting the goals as one’s own and striving to implement them in one’s own life will smooth the way down. I don’t see how that strategy can hurt–and it might help.
Don Stewart
You are probably right.
I think a lot of this depends on how bad the collapse is. There is widespread belief that “using less” fossil fuels is helpful. If the problem is quite different–banks not being open, so what is available is simply what is available within walking distance of a particular homeowner–then the problem needs to be defined quite differently. This also affects the issue of whether it is helpful for homeowners to grow mostly foods that are hard to transport.
In my part of the country, tubers would be the ‘calorie dense’ crop if the banks are closed and there is no electricity. Sweet potatoes are quite a versatile crop, giving us green leaves in the summer and storable tubers for the late fall and winter. Sunchokes are another semi-wild tuber which are not only easily grown, they are hard to eradicate once planted. Root cellars would again become fashionable.
Corn would also provide quite a lot of calories. I live in the Piedmont where modest amounts of falling water were pretty easily available. When I walk by the creek near my house, I can see the rubble from old mill dams designed to hold water to drive corn grinding mills. There are old millstones scattered around in the woods. I doubt wheat or rye would be the first choice here.
If we assume a ‘moderate disaster’, such that farmers with horse drawn buggies will be peddling sweet potatoes, then the thing that makes sense is a personal root cellar in your house, grow the highly perishable greens and fruits yourself, and buy the roots in bulk from farmers. Salvage firewood from the abandoned houses all around you, etc.
But if someone were living on water, the choices would be different. Somebody came up with some comparisons. It was something like this: A product could come from China to New York City more easily than a product could be transported from Atlanta to Dalton. If railroads survive, then of course they make the Atlanta to Dalton trip a lot easier. Once Sherman cut the last railroad into Atlanta, the Confederates had no choice but to abandon Atlanta because land based transportation without railroads was just extremely difficult. In the movie ‘Lincoln’ someone observes that the war will get back in gear once ‘the roads dry out’. But it was very easy to go by boat from Washington to Hampton Roads.
So it depends on the extent of the disaster. I think, perhaps naively, they some preparation is better than no preparation.
Don Stewart
Anyone thinking about survival in tough times needs to make some fundamental decisions. James Howard Kunstler today opines that politicians who don’t support railroads are dooming their children to live their lives in a 10 mile radius. That statement assumes that they are confined to land. But if you read The Old Ways by Robert Macfarlane about the ‘sea roads’ from Scandanavia to Iceland and down to Scotland and through the Irish Sea and over to France and down to Spain, you can pretty quickly figure out that water changes everything. People thousands of years ago regularly made long voyages for trading and fishing (without benefit of GPS). I think Kunstler understands that, as one of his stories involved the rejuvenation of the docks at Albany after the great collapse. I suppose that if you were firmly convinced, you might consider moving from Atlanta to Augusta. Savannah will be underwater, but Augusta is the head of navigation on the Savannah River. People from the mountains in western North Carolina used to travel down to Augusta once a year (in the summer, when the roads were dry) to get essentials such as salt and frilly dresses for the ladies.
A friend of mine who became convinced about the impending collapse planted 40 peach trees on his property. Last year, he made about a bushel of peaches, all told. Climate change as it played out last winter destroyed fruit crops from Georgia to Michigan and Massachusetts. So, first, my friend has all his eggs in one basket in terms of climate risk. Second, he is going to get an awful lot of ripe peaches at just about the same time in a good year. That makes him not a gardener, but a farmer. He will be dependent on his ability to trade his peaches for other foodstuffs that his neighbors are growing. His ability to do so is far from certain. This decision to specialize or to diversify is closely related to the issue of globalization. Being dependent on peaches is similar to being dependent on China–it may be efficient in the present world, but not resilient in the world to come.
I think that no amount of rational thinking is going to reveal a definite answer. I think the right thing to do is read Jonah Lehrer’s book How We Decide. Take his advice to think about it a little bit, gather some but not too much information, sleep on it, and do whatever feels the best the next morning. What makes me feel the best is the ability to self-provision most of the perishables we eat. I am comfortable not being totally self-reliant–which I see as most likely impossible. Other people will be comfortable with other paths, including just doubling down on the current system.
Don Stewart
Don
Like millions of others you are falling into that trap of mental imagery, where our inevitable ‘downsizing’ leaves us in much the same situation as we are now, but with fewer people.
A nice easy transition, with the utterly ludicrous suggestion that we can pick up the old sea trading (spot of pillage anyone?) skills of our viking forbears,
One can only try to visualise the reaction to a fleet of longships ranging down the New England coast!! Or even the old England coast.
we look on those old guys as great survivors, tougher than we will ever be, but we forget that they only survived through the harsh learning curve of those who went before them. Imagine the heredity necessary to build something as stunningly beautiful and functional as a longship, and then think of all the deaths that occurred before they got it right
Now fast forward to our own time, not with a world of a few hundred million, where you could show up anywhere and find land pretty much empty, but with a world of 7 billion, land fully occupied and everyone determined to hang on to their bit of it.
Unless one is supremely skilled, water has a nasty habit of drowning people
Dear End of More
I heard a story several months ago. Someone was reflecting that their mother, living in Germany near the end of WWII, had taken her sow to the next village to visit the board in the spring of 1945. The villagers thought she was being foolish, because the advancing troops were sure to kill all of them. So the villagers were basically neglecting their farms. As it turned out, she had piglets the next fall which brought a good price. The moral of that story is that we never know how things are going to turn out, and we do what we can.
And that is my philosophy regarding food and shelter and water. Do what I can. If a roaming band of brigands slaughter me…well there isn’t much I can do about that.
Don Stewart
I agree that diversification is probably best. Many people don’t have many options though–they live in an apartment, and have little ability to own land, for example. People reading this blog are on average richer and better educated than the general public. A single mother, for example, is not likely to be in a position to do anything other than try to support her children now–forget about any future preparations.
I think someone has commented that the amount of feed a horse needs to eat limits land transport to some very short distance–I forget what it is–5 or 10 miles, IIRC. It is such a big difference, that most of us can’t quite imagine it.
Corn is really a grain as well–just an oversize one. It still stores well.
This is why stage coach horses were changed at 20 miles maximum. they simply ran out of energy.
the same horses could be ‘refuelled’ and used for return stage journey, probably the next day
I can see we would have a problem delivering today’s volume of mail by stage coach. Not to mention bringing goods using horse-drawn vehicles.
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That tight oil growth rate spike is truly amazing when you think about it (and the drilling frenzy associated to it)
Yes, but the number of drilling rigs is already down. Baker Hughes oil drilling rigs in the US hit a high of 1,432 in the week of August 10, 2012, and are now down to 1,329, about a 7% drop. (Gas drilling rigs are down by over half.) It takes a while for new wells to get fracked and on-line, but we are not likely to see the growth continue at nearly the recent rate. In fact, oil production may level off fairly soon.
If the tight oil phenomenon is this fleeting in the US, it won’t make sense for other countries to put in pipelines to develop the resource. It will be just a flash in the pan.
Yes I’ve seen this, what is impressive is the synchronicity between this and the global peak we most probably are at, giving it a kind of “swan song” aspect.
What do you think about the two reports published at :
http://shalebubble.org/#learn-more
Especially the one regarding “shale and wall street” ?
David Hughes report Drill Baby Drill is very comprehensive. He does a very nice analysis of why production will not rise for very long, even considering the many sources of unconventional fuel available. He includes an amazing number of graphs on all kinds of subjects associated with unconventional fuels. There are two things he doesn’t address:
1. The new technology will save us argument. If we now have discovered a technique that will ramp up production as much as it has, what is there to say that there is not some other technique “out there” that will allow us to ramp up, say, very heavy oil production greatly. If we missed the rise in tight oil, what is to say we might not be missing something else?
2.The financial connection. If oil prices are too high leading to financial collapse of governments right now, all of this is a bunch of numbers on paper. Production is likely not to work out as well as what the graphs might suggest. This would be my big concern about the report. It gets people to focus on the wrong problem–quantity vs price of what is extracted, and what impacts those high prices are likely to have right now.
Deborah Rogers makes a lot of interesting points in her article Shale and Wall Street: Was the Decline in Natural Gas Prices Orchestrated? I think it is very likely that Wall Street helped pump up the story about shale gas. I am wondering if there wasn’t possibly a more benign reason for Wall Street’s pumping though. It seems like Wall Street would make money, whether the price of natural gas went up or down (perhaps more if the price went down). So they were in a no-lose situation with respect to promoting shale gas’s prospects. Thus they could pump up the need for its production, without really hoping for its price to decine.
Also, the fact that overproduction could happen very easily may have not occurred to Wall Streeters, since they likely do not understand how slowly the market absorbs new natural gas production. It takes a while to build new plants that would use natural gas. The reason natural gas use by industry has been declining was as much because our wages were too high as that our natural gas costs were too high. The cost to produce shale gas is still high; it is the selling price that is temporarily low. This is not the dynamic for a rapidly growing natural gas industry. Anyone sensible would not build a plant using natural gas, based on a temporary low selling price.
“1. The new technology will save us argument. If we now have discovered a technique that will ramp up production as much as it has, what is there to say that there is not some other technique “out there” that will allow us to ramp up, say, very heavy oil production greatly. If we missed the rise in tight oil, what is to say we might not be missing something else?”
Hi Gail, is that your view or are you addressing the fact that the author failed to address that common argument? Hydraulic fracturing has been around for many years. The high price of energy lead to unconventional shale plays being developed, not new technology. The fracturing process has been refined and there have been new additions to the process; I do not believe there has been any major technological breakthroughs recently however. Just the end of cheap energy.
Thanks for your high quality analysis it is appreciated!
Mark,
It isn’t my view–it is more the response I expect that people who already have their minds made up will have. “Technology will save us. It always has before. Someone would have told us if it weren’t true.” (LOL!) They don’t realize that the technology was there for a long time; the big thing that changed was the oil price had to rise to be able to make the technology cost effective. I don’t remember the author making this point, but it is possible I missed it. He was not really looking at the issue from a financial point of view.
Gail, if your conclusion is that we will see financial collapse first, with severe economic consequences, then wouldn’t you have to examine (maybe in another article), how this might play out? The first question seems to be, what is more likely: a slow decline into widespread poverty, while the system stays together? Some say we can kick the can for decades, muddling through with more of the same. This would be a good case for preparing personally as long as we are able to, develop strategies, hell maybe even improve your life in some way. On the other hand, in this case the “finite world” problems will resurface. Or will we have severe financial disruptions soon, possibly including civil unrest or even war? What to do in this case, seems very difficult. You not even know which places are going to be safe. Big cities certainly not. You would have to put your wealth into “prepping”. What will be the political structures thereafter? World government or feudal clans?
I really can’t see: how far is the fall going to be? But certainly much deeper than all the people out there believe.
Writing about collapse is a difficult thing to do without people getting upset about it. A person has to frame the situation as “one scenario that may occur,” or write a fictional account, to make it a little more farther removed. These are a couple of posts I have written a while ago on the subject.
Where is oil production headed? An Adverse Scenario
Economic Impact of Peak Oil Part 3: What’s Ahead?
I am afraid that we have a number of countries that are headed in the direction of collapse right now: Syria, Libya, Yemen, Egypt, Greece, Spain, and several others. I am afraid we will get to see for ourselves what collapse looks like.
Dear Gail; As always, you are very insightful. Your near term analysis of our energy situation is right on target. Just a note: Your “Economic Sinkhole” article is a true classic. It should be required reading at all universities and colleges. (and Congress!! and the White House!!)
However, I always like to take the long term view of our future, especially when it concerns oil and energy. For example, I’m always amused at some of the frantic “talking heads” one sees on the high excitement business shows on cable tv. Their idea of “long term” sometimes seems to be, “next month”. I feel If we want a true “long term” outlook, we should be talking about decades and centuries into the future. H We humans have had the stone age, the bronze age, the iron age, and are now most likely at the end of the oil age. Applying more “conservation” in our use of oil, energy pricing policies, the ups and downs of business cycles, etc, are constantly analyzed and discussed. However in the long run, they are all meaningless. The oil will “run out”. The iron ore will “run out”. All the other minerals and finite resources will “run out”. Our wonderful planet Earth, will not be able to support 7 billion+ people. That’s the real “long term” outlook for the future, and it’s not possible predictions to predict what it will bring. All in all, rather dis-heartening.
SOmeone sent me a link to The Optimism Bias. In fact, there is a book by that name, and a Time Magazine article in that link. We seem to have been naturally selected to be optimistic regarding what the future may bring.
‘Swan song’ reminds me of the great Ibn Khaldun, who observed in the 14thc that ‘states which are about to decline appear most brilliant and powerful just before it happens, as a guttering candle flares brightly before being extinguished.’ You may be right………….
Activity becomes ever more frantic as doom beckons.
Two simple overall-solutions to a world with finite resources that may be worth considering:
“about nuclear being a solution”
According to http://www.jimstonefreelance.com/busted.html – The ‘holy grail’ of nuclear power “closing the nuclear loop” was achieved, by was then banned by President Carter’s executive order –
” […] When a reactor such as a boiling water reactor uses fuel, the waste products, which are highly radioactive isotopes that have a different fission characteristic than the fuel, build up in the fuel and poison the nuclear reaction. A reactor such as a boiling water reactor can only use the fuel until it gets contaminated by these isotopes enough to change the nature of the nuclear reactions taking place. The reaction environment inside a boiling water reactor is only one such environment that will work to trigger a chain reaction, and if that spent fuel is put into a reactor made from different materials, those materials can favor the burning of the poisonous isotopes, and use the isotopes as fuel until the fuel is purified of them, and therefore had it’s original radiological characteristics restored. Once that is accomplished, the fuel can go back into the boiling water reactor, and used as new.
We perfected the second reactor design, which used liquid sodium as a coolant, and the reactor ran much hotter – 1100 farenheit as opposed to 550 in a boiling water reactor. The liquid sodium circulated inside the reactor in lieu of water, with the heat of the reaction being removed from the system by a heat exchanger which boiled the water outside the reactor for use in producing electricity. The temperature difference and coolant characteristics facilitated the burning of the isotopes, and you got to use both sides of the reaction – one side produced electricity while poisoning the fuel, and the other side produced electricity while burning the poisons out. This process can be repeated 20 times, and when it is finished the fuel is DEAD and no longer hazardous because all of it’s radiological potential has been used up. It was a dream come true, and Carter banned it by executive order!
He specifically stated that the burn down was so complete that the spent fuel was safe to handle directly with bare hands, and needed no special care or maintenance at all.
He then went on to lament about what a waste of money it was, because the fuel is expensive, and they were only using it to about five percent of its total potential. He lamented the fact that his life’s greatest accomplishment got banned for no good reason, and it was a tremendous waste of money to not use the technology his team developed. Electricity would have been cheap. REAL CHEAP. So cheap that homes would not have been heated with oil or natural gas, electricity would have been the only sensible choice. Furthermore, with a reduction in the price of electricity by at least 10X, electric cars would have been a no brainer.
This would have been America’s free energy future, with the only real cost being maintenance of infrastructure.”
“I have tried to do a little gardening”
Permaculture or ‘companion farming’ aka ‘push me pull you farming’ is an ancient system that uses combinations of mutually supportive plants, where the waste product of one is utilised by another, thereby increasing quality while reducing the need for artificial soil conditioning. Other plants are used to either repel or attract insects as needed – it was once reckoned some 6 people could live 75% self-sufficient on the produce of a single permaculture acre, whereas a single cow would require some four acres and yet the meat produced would not support those six people
Meanwhile the lunacy of EU agricultural policy means that a farmer can recieve a tax-funded grant per acre for growing potatoes and corn in the same field and at the same time – yet potatoes and corn can never grow well well planted directly together since each plant releases chemicals that are toxic to the other – both yield and quality will always be minimal – perhaps pig-food quality!
Imho – An essential part of any solution is Individually and Collectively reconnecting with and revering Earth and her Natural laws, this will lead to a return to a world of sanity and truth organised around human horizontal connections instead of top down manipulations
“An essential part of any solution is Individually and Collectively reconnecting with and revering Earth and her Natural laws..”
It’s highly unusual to see a statement like that from someone who is strongly pro-nuclear. That’s not criticism; I happen to agree. But it feels rather rather lonely out in this part of the ideology space.
I suspect that what happened back in the 1970s is that the fossil fuel industry, whose preeminence was threatened by nuclear power, pulled off the same trick that they more recently worked with the global warming issue. They grafted the memes that they wanted to promote onto another popular cause, to get a free ride on the energy that that cause engendered. Today it’s the libertarian-conservative anti-big-government cause serving as the unwitting host for the grafted memes; then it was the anti-big-business environmental cause.
If I weren’t so offended by it, I’d be in awe of how well it works.
There seem to be approaches that might be better on nuclear, but at this point, we haven’t implemented them, and the rules in place in the US make nuclear very expensive. If we had lots of time, perhaps nuclear could be “rehabilitated” and made to work in a cost-effective manner. But it is hard to recommend anything with nuclear, if our time is very short on the development end.
With respect to permaculture, there seem to a number of different variations. Some make fairly heavy use of abilities we have today to move earth and soil amendments, and use devices such as hoses, plastic sheets, and water pumps. As long as the current system works, these will work, but I am not sure how much longer.
There also seem to be versions of permaculture that assume we will grow a different mix of crops than we grow today. In particular, grains are often omitted. It seems like this may be a problem. Grains represent a large share of the food the world eats today because they are easy to transport and store. If we substitute other types of foods, will be able to process and store them as well? Also, the total number of people that can be supported may decrease substantially.
Maybe to sum up, “The devil is in the details.” Maybe permaculture will work, sort of, but it has to be adapted to the climate and soil of each area, and the level of fossil fuel support available (which may be very little). It looks to me as if it will work better if we still have some fossil fuel capabilities, than if we don’t.
Stupidity or accident is more common than conspiracy, but that doesn’t mean either planned conspiracies, or a de facto conspiracy of alliances that forms semi naturally don’t exist.
Google AgitProp to see how that technique applies across the board to most politics today.
Then look at any political issue..I mean really how much DO you understand climate science? the technology of energy generation? nuclear energy?
You may be an expert in your chosen area of study – the impact of global fossil fuel prices, and have done the hard work to bring yourself up to speed on that, but the rest? No. You haven’t done the hard work to understand the science and technology. And its limitations. But you have strong opinions on it. You would preface these perhaps with ‘I think’ and thereby delude yourself into thinking that you have thought.. But the reverse is true. Mostly one hasn’t thought or calculated or bothered to study the basis on which these opinions that you received are founded. One accepts or rejects them in ignorance. And feels enlightened thereby.
Which is how AgitProp works. By flattering the egos of those who consider themselves intelligent, but are in fact ignorant.
Its so much easier to fall in line with what people who appear superficially to know more than you do, say.
Now this is both stupidity and a conspiracy., It is a conspiracy perpetrated by those adept in marketing techniques, playing on the natural egotism of the half intelligent. Its not done for reasons of philanthropy. Its done for reasons of greed and profit. But once a bandwagon is rolling, its much easier to jump on it than cast yourself under the wheels. Which is what I mean by a de facto conspiracy. If someone else’s marketing has persuaded people that eating waste milk products turned into yoghurt with chemical vitamins sugars and fruit flavourings is ‘healthy’ and I have a herd of milk cows whose output I cant sell as milk, well hell. Caveat emptor.. I’ll be investing in yoghurt plant and plastic potswith happy cows beaming all over them, won’t I?
And heaven forfend that, in a rare moment of candour, I have a ‘Ratner moment’ *
So its both stupidity and conspiracy, even if it ‘s only a conspiracy of silence. I spoke to some academics at my former college. They openly admitted that everything they do is angled by the department head to have a climate change or renewable energy angle “because that’s how we can get the funding”. So what was sold for funding purposes as ‘solving carbon capture issues’ was actually in the end about more efficient coal power stations.
In the end though, like all things we culturally regard as ‘immoral’ or ‘sinful’ such lying by omissions is in the end, (and its a very long end), self defeating. The markets as they say can remain irrational longer than you can afford to lose money..and the same principle applies in history which is littered with civilisations that collapsed despite the ever increasing efforts of their priesthoods – whether by human sacrifice or building icons to their gods – like the three armed crucifixes we see littering the countryside – in the end Darwin rules, and civilisations that have aberrant received ‘wisdom’ foisted on them by the priests of marketing simply vanish from the face of the earth. Or get overrun by civilisations who are temporarily more in touch with reality than they are.
Tainter wise, today’s civilisation is so complex that no one understands all of it, and very few people- and probably not enough people, understand it enough to maintain it in the face of the challenges it faces. And they are shouted down by the priesthood, who are less interested in maintaining it than maintaining their own positions in what is left of it.
As I have said repeatedly, collapse comes not because no one understands what to do, but because the greater mass of people have not even the wit to understand who has.
Sadly this blog merely proves the point: By and large the vast majority of people either don’t see the problem, or remain committed to cat-belling** solutions, or solutions that haven’t a cats chance in hell of working at the sorts of levels required to maintain the current populations and lifestyles, whilst being vehemently opposed to the very few that do offer some possibility.
The reality is pretty much the opposite of ‘what people think’ these days. There probably isn’t a CO2 problem, there probably IS a peak oil problem, renewable energy doesn’t work and is expensive and environmentally devastating, nuclear energy does work and is safe cheap and reliable and has almost no real environmental impact. Going back to pre-industrial civilisation is only an option for at best 5% of the population of the West, and it wont be any of the bloggers here. These after really thinking hard about them and doing the in-depth research, are rational conclusions.
Now look at the responses…
*”We also do cut-glass sherry decanters complete with six glasses on a silver-plated tray that your butler can serve you drinks on, all for £4.95. People say, “How can you sell this for such a low price?”, I say, “because it’s total crap.” (http://en.wikipedia.org/wiki/Gerald_Ratner)
**http://en.wikipedia.org/wiki/Belling_the_cat
I have heard the term “agitprop” but never connected it with the issue you are talking about.
There definitely is a huge problem today with groups sponsoring “solutions” which are not really solutions, but which will help politicians look like they are doing something, and will help the manufacturers of the “solutions” sell their product. This is how we get the Democrats and the Republicans completely talking past each other. Neither is really telling the story as it is.
I do my best to tell the story as it is, but I can’t be an expert in everything. It is easiest for me to speak out about the things that it is easy to put together little graphs on.
You may be right about nuclear being a solution, but I am not enough of an expert myself to say that is the case. It is pretty clear that the radiation scare is overblown, but I have a hard time putting numbers around it, and becoming an advocate. If nothing else, we will probably still need a long term supply of uranium (unless we can get thorium to work), and this will likely need to be imported. Recycling can take care of much of the fuel need, but this would mean big recycling plants need to be built now. With the laws that are in place now, it will be very hard to build cost-efficient nuclear power plants in this country. We would need a lot of them, and a lot of investment, and it is not clear where the investment would come from. In another sixty or so years, they will have to be rebuilt again, probably with very little oil.
THere are a lot of things that clearly won’t work. I have not written as many articles about these recently. When I do, I seem to get readers upset who have their hearts set on ______ fixing climate change, or saving the world from peak oil, or whatever. I will probably eventually get back to writing on these issues. In part, I would like to learn more myself, so I have all my bases covered. I will be speaking at the Electric Power Conference and Exhibition in Chicago on May 15. I plan to attend the rest of the conference on May 14-16, to learn a little more about what electricity people themselves are saying about the various alternative sources of electricity.
What they are prepared to say on record is vastly different to what they will mutter under their breath in private after a few glasses of ‘orange juice’.
Everything is politicised. People who want to keep their jobs stay on message or stay silent.
The only people who are free to speak are, as I am, retired..Or in unrelated fields.
That to me has been the most scary thing of all – scarier than climate change or nuclear power. The realisation that one is akin to a Jew in Nazi Germany. A stranger in ones own country, and tolerated only until the ideologues feel secure enough to suppress all dissent..
Control the information channels and you control the political agenda and the people.
Even “expert” opinions are controversial up to a very high level. And of course there are vested interests most anywhere, nobody in their right mind can doubt that. But I like this blog because it looks at the big picture, and that’s where common sense, logical reasoning and intuition work very well to explain things. IMO we are at a point in time where it is crucial that more people start to understand what is happening in a highly complex world. That doesn’t mean solutions.
This rantpost was hard to follow, but look on the positive side, if Gail can get a drinks tray and glasses for £4 95, she can afford to pay her butler higher wages
Leo Smith rails against posters here seemingly on the basis of his belief that they do not know as much as he does and then goes on to prove just how ignorant he is by making the breathtaking comment “The reality is pretty much the opposite of ‘what people think’ these days. There probably isn’t a CO2 problem.”
What others do about Leo’s rant is obviously up to them. What I will do is dismiss his views on CO2 in particular and climate change in general until he is prepared to come up with scientific evidence to support his position. Evidence that has not been debunked, of course. One can find scientists whose views fly in the face of the consensus of scientific opinion arrived at by 97% of leading climate scientists, but very few whose work has not been debunked. (For instance, one leading climate scientist who dismisses climate change does not believe that smoking causes lung cancer.) Leo complains about people not studying issues in depth, yet he consistently posts comments on climate change on this site that give no science in support that can be checked. I do not care much what people think on scientific issues unless they can support their opinion with hard verifiable evidence and I am darned if I am going to make an exception in Leo’s case, especially so considering his credentials. He should know the scientific method far better than most.
Heaven knows there is a wealth of evidence that the climate is in fact changing and a lot of hard science that explains why it is doing so. Furthermore, there is a lot of hard science that predicts pretty dire conditions for the future if it carries on as it is. (Gail is of the view that the coming collapse will rectify the matter. Quite possibly, but climate scientists don’t believe we can wait much longer before it becomes unstoppable.) Leo seems to have the opinion climate change scientists are only in search of funds and it is all a conspiracy on their part to achieve that goal. How lucky for them that Old Mother Nature has joined in their little conspiracy. Were Leo to investigate the issue, he would find that a significant number of the 3% of scientists that disagree with the consensus are in receipt of funding from the fossil fuel industry, source: skepticalscience.com. If I remember correctly, in the past Leo has quoted the Global Warming Policy Foundation, which was set up by one Nigel Lawson. Investigation of that body reveals that its funding is a secret. I would expect a Cambridge graduate, especially one from the sciences, to be able to add two plus two and get a pretty accurate four.
If Leo is wrong, and the overwhelming body of climate scientists are right, then Leo’s efforts at ridiculing climate change will, if they achieve anything at all, slow down action to combat it and thus do us all harm if successful. Unfortunately, we have a political class that would prefer to listen to the Leo Smiths of this world rather than make the difficult decisions that climate change requires. But of course, Leo does not have any children to worry about, so what matter to him that future generations of my family are likely to be harmed by his actions? Yes, Leo, I do take it personally, very personally.
Well said.
I agree with most of what Leo says except the CO2 issue.
hmmm… so in essence Leo, you’re saying AgitProp, Stupidity, Conspiracy can be broken down to its constituent parts: differing shades of Hubris.
“Hubris of hubrises, all is hubris. That which was, is what will be; and that which is done, is what will be done yet again; and there is nothing new under the sun” and all that as the sages deduce now and then.
Perhaps we can’t help it. We’re not evolved enough, our forms are too new in the great scheme of things thus we’re only chimeras, ripples, being able only to reflect much more basic forms all doing exactly the same thing for the past 4.5billion years as they’re all doing on/in every rock orbiting any star at a comfortable distance.
Maybe is our lot, really minute cogs in this universe-encompassing evolution.
That all is likely hubris too.
This article and its comments are a great summary of our predicament, and also exemplary of all the noise accompanying it. What will it take to get a critical threshold of humans to internalize this complexity into their experience, wake up, and experiment with different behaviors? More that we can readily summon in any cultural or social context, but various small and great crises will sooner and later provide selection events to sort out those experiments.
Nonetheless, all, keep up the good work, and the maturing consciousness. It’s the least that a person of courage and integrity can do.
Glad you liked it! Let your friends know about the site too.
Gail,
An interesting list that includes some important issues regarding finite resources and developing vs. developed world. But you’ve left out what I think of as the most fundamental problem with globalization: its lethal effect on bootstrapping.
There is a process of capital development and building that developed nations went through to become developed. That process is not an option for developing nations. The output from its early stages can’t compete with the output from its later stages available in developed nations. So, for example, it’s impossible for poor farmers in developing nations to grow food as cheaply as it can be sold on the world market from developed nations. The difference in productivity from capital resources can’t be offset by any differences in the cost of labor. Even slaves have to eat, and products of slave labor can’t be cheaper than the cost of keeping the slaves alive.
With bootstrapping precluded, developing nations are forced into dependence on imported capital and export of natural resources. Outside money can build factories to take advantage of cheap labor, but the benefits stay principally with the outside capital owners. It’s a newer, more efficient form of colonialism.
A prerequisite to any development is a safe environment in which development can proceed. That’s true whether one is talking about a fetus, a business enterprise, the growth of crops, the evolution of a new species, or the development of a national economy. For economic development, a safe environment was once provided by a combination of distance, cost of transportation, absence of incumbent competitors, and sometimes protectionist trade policies. These days, the first two of those protective barriers are insignificant, and absence of incumbent competitors is a game for the most innovative and generally high-tech enterprises. Protectionist trade policies are about the only recourse available to developing nations. China has been able to develop rapidly in large part because the central government sets the exchange rate of its currency. That keeps its exports cheap and is a form of protectionism.
Protectionism has a deserved reputation as the enemy of market efficiency. But market efficiency is not our current problem. We’re awash in excess productivity. Market efficiency is what is ultimately what is behind over-consumption and unsustainable use of resources. We need to work out a more appropriate balance, and a culture that will support that balance.
Very interesting observations. Thank you!
I hadn’t thought about it, but you are right. The developing nations have a great deal of trouble in competing to raise food cheaply. Not only that, but if a person in the US were to lose his job, and attempt to raise food with no fossil fuel inputs as a means of supporting himself, he would also have a huge problem as well. (Even getting the land would be a huge problem.) If he could get around that issue, he would find his efforts did not produce a huge amount of food. If he tried to sell the food he didn’t need for himself in the US market, he would find the amount he earned from it would not be enough to cover his basic needs (such as cooking fuel, clothing, cost of shelter, containers for food storage). I have tried to do a little gardening, and this situation has been obvious to me. With tools made with fossil fuels (like shovels) and soil amendments transported by fossil fuels, the person could do a little better, but it still is difficult.
With respect to investment, I had thought that China was a special case in terms of doing some (much?) of its own investment. With a one-child family policy and very little in the way of pension plans, Chinese families see a need to save for retirement in a way that other countries do not. The money saved by Chinese families can be used for investment (along with a huge amount of debt) as a basis for investments. With one-child families, the number of workers in the labor force is much higher as well, and the amount of resources that must be used on child care and schools much lower.
Do you have references you would suggest reading regarding bootstrapping and related issues?
I don’t have a particular list of references. The Wikipedia article on entrepreneurship has a definition for “financial bootstrapping” as “a collection of methods used to minimize the amount of outside debt and equity financing needed from banks and investors”. Here in Silicon Valley, it’s familiar as the way founders strive to grow a business without having to relinquish ownership and control to outside investors. I was using the term informally, for the same concept extended to developing national economies.
There probably are good books on the topic — and if there aren’t, there should be. But the problem is that bootstrapping and globalization are inherently antagonistic. Bootstrapping an economy generally requires protective barriers to allow local businesses to develop and succeed, even when they are immature, under-capitalized, and “inefficient” by world standards. Globalization is all about breaking down those barriers, to maximize markets available to top incumbents.
I obviously lean toward bootstrapping, but it’s dangerous to get too ideological about this and label one approach as unconditionally good and the other as bad. Going back to the enterprise examples, I know of promising businesses that failed because the founders were intent on keeping control and wouldn’t agree to the terms of outside investors. I know of others that failed because the were acquired by a larger company or taken over by investors who didn’t understand or didn’t really care about the business. On the other hand, I know of businesses that successfully bootstrapped themselves all the way to global prominence, as well as businesses that succeeded after the founders surrendered control to knowledgeable investors. All four quadrants of the chart are well populated; what matters to success or failure are details of the people and circumstances involved.
For some developing nations, the quickest –or perhaps the only feasible — escape from poverty might well be to court outside capital, and trust in trickle-down to eventually raise living standards for the country as a whole. But the record of multinational corporations for spreading the wealth is not encouraging. They have developed in and been shaped by a culture that worships competition and “winner take all”. Individually, the executives who run them may be well-intentioned, but they answer to boards and to stockholders whose solely on the bottom line.
Under that regime, any external costs that can be swept under the rug and left for the future to deal with, will be. That has to change.
Thanks for the additional information.
I would like to comment on the issue of gardening or very small scale farming in a globalized food world.
The big internationally traded crops are dominated by grains, soybeans, meats, and specialty products such as coffee and tea. None of these are appropriate for a newly unemployed worker to attempt. In the case of the US and China, the US has flooded the Chinese market with cheap frozen industrial chicken, while the Chinese have flooded the US market with cheap apple juice. Our hypothetical unemployed worker would be a fool to get into either business.
What DOES make sense, in my opinion, is to grow one’s own greens and fruit. Why? Both are high priced because they contain a lot of water. That makes them perishable and expensive to ship. In the case of greens, the additional factor favoring gardening is nutritional value. No one eats greens (collards, kale, lettuce, green onions, etc.) for the calories. They have only 100 calories per pound. To get 2000 calories per day, one would have to eat 20 pounds per day–which is gorilla like. And since they can retail for 5 dollars a pound, one would be talking about a hundred dollars per day per person. Instead, we eat them for the health benefits. And the longer the time from plant to plate, the less the health benefits.
There is, in the US, theoretically enough suburban lawn to grow much more greens and fruit than we currently eat. The opportunity cost for our hypothetical unemployed worker is low. Does he just draw his unemployment and watch TV, or does he garden and grow beneficial greens and fruit in his yard? While it is entirely possible to spend a lot of money gardening, it is not necessary. An immigrant is likely to be able to start a garden for less than ten dollars. A white collar American may end up with the proverbial 75 dollar tomato.
There ARE barriers. The most significant is the loss of the necessary skills over the generations which have thought that ‘food comes from grocery stores’. The second significant barrier is that builders generally scrape off the topsoil and sell it to someone. So the quality of the soil is poor. In addition, the lawn has been treated with artificial fertilizers and herbicides which have killed the biological life in the soil and reduced it to dirt. Our unemployed worker would have been a lot better off if he had begun to restore his soil 4 or 5 years ago.
Based on some fragmentary data, I recently guesstimated that leafy greens may require 20 calories to produce 1 calorie in the industrial system (as compared to 10 to 1 on average). From an energy efficiency standpoint, it makes sense to grow ones own greens and harvest them as needed. It allows for smaller refrigerators, avoids shipping water across the country, avoids the spoilage problem in grocery stores, avoids trips to the grocery store to buy fresh greens, etc. In addition, it provides satisfaction that is hard to put a price tag on.
These arguments apply whether one is an unemployed American or an impoverished Latin American or African. David Kennedy, the author of 21st Century Greens, relates that one of the events which got him very interested in gardening greens happened in Nicaragua. He was talking to a woman holding a sick, obviously malnourished, child. She was standing in front of a Moringa tree in her front yard. She did not know that the Moringa has perhaps the most nutritious leaves of any vegetable. Almost certainly harvesting and eating leaves from the Moringa, available for free, would have significantly ameliorated the malnourishment.
This does not mean that Nicaragua can get rich selling Moringa leaves on the international markets. It does mean that they have in their hands the ability to significantly reduce malnourishment and the attendant ills.
Don Stewart
Don
In the 1940’s in England, when rebuilding started after the War, workers from some of the worst areas of Wales were resettled in government housing (3 beds, brick-built, quite good really) in the agricultural villages of the East of England. The modest houses were given larger gardens than workers ever had before ( about 100 feet x 25 to 35 feet) in order to allow them to grow vegetables, fruit and keep rabbits, hens and maybe a pig – this was a direct response to the semi-starvation of the 1930’s.
Now, most of these plots are tarmaced over for parking or garages built on them; and all modern house shave only enough space for a table and three chairs – you couldn’t do anything with them even if you wanted to. Inside, the houses have no storage space, so options are very limited indeed. My own suspicion is that the houses with untouched gardens will have a very high value in the near future….
Reblogged this on Economía en tiempo de burbujas.
The topic of globalization brings me back to the work of Walter Prescott Webb and his book THE GREAT FRONTIER. His thesis was that the Age of Discovery transformed Western Civilization and created the modern world. Europe in 1400 was a static society that had reached subsistence balance between population, resources, and land. The discovery of new lands with all the resources changed that. According to Webb our modern world with democracy, emphasis on the individual, capitalism and the corporation were all outgrowths of news lands and resources. Perhaps the end point of globalization is simply reaching a new subsistence balance globally between population, resources, and land–a great leveling out and greatly reduced material existence for the richer nations.
Perhaps, but only if we can gracefully figure out a way of decline to, say, the level that India lives at today. One of out big problems is that as we build upward, we remove the ability to do the approaches that worked in the past. We used to have animal driven carts, but it is not clear that we have the animals, carts, and knowledge of how to do this today. We could no doubt figure it out again, and scale it up again, but it is not immediately available.
Bigger problems are things that are not so obvious. We have so many people today that getting along without antibiotics would become a problem, especially in big cities. Our food is grown and processed at long distances from our homes. We would have to completely redo the system in a poor world.
Horse droppings were a major problem in Victorian London. O.K. if you like roses, I guess.
a horse needs 2 acres to obtain its energy input, we just don’t have that much space available. there’s masses of visual record out there about what life was like in cities when horses were the main source of energy
We clearly need a lot fewer people and fewer cities if we are to attempt to use horses again.
No, we can’t go back to earlier modes functioning efficiently, only first decline and then collapse.
For example:
In England the Dukes of Devonshire bred the most superb shire horses to pull ploughs, etc. When mechanised farming came in at the end of the 2nd World War, they all were taken out and shot in a few days. End of the bloodline, which was the product of about 200 years of breeding in England, and many more centuries elsewhere.
A great deal of knowledge and capacity to live at a ‘lower’ has been lost and can’t be summoned up again rapidly.
In contrast, when the Roman cities and towns fell apart, the whole rural structure remained, at so basic a level that no matter who the conquerors or how many massacres took place, farming and hunting just went on: the peasant was a self-replicating source of energy and there were always wild boar and deer in the forests, wildfowl, etc.
In addition to our complex high technologies which we can’t just step down from, we have so diminished the diversity of the environment that there is almost no natural resource base to fall back on. I look at the fields here and see the blank monotony of modern monoculture and an imported worker driving a tractor in a fields once full of labourers and a landcsape once rich in hares, rabbits, deer and wildfowl…..
They used to say that the Russian aristocracy never worried about tomorrow, and spent freely, because they just had peasants who bred more peasants who bred more peasants and so on. We live as if we were aristocrats, but our petrol slaves are about to go on strike!
That is a good way of putting it!
globalisation has been under way since we first wandered out of Africa, only the scale of it is a
a recent phenomenon
yet the forces that drove our ancestors are still with us. They moved to exploit opportunities, some successful, some not, taking 50000 years to walk around the world, extracting resources, leaving groups in one area then moving on to new lands and creating new racial groups on the various land masses. It takes perhaps 200 generations, maybe less to create distinct racial strains, and to thus supply the reasons for conflict
the urge to push on is still driving us, but unfortunately we’ve run out of space just at the point in time where we have the means to take slaughter to a new dimension.
The world is full, but we want to go on filling it—our genes have not evolved to stop, genes have no concept of finite.
So we will continue to globalise an already full world. 200 years ago we were filling the empty spaces on land, now we are forced to turn our attention to the cyberspace of finance and profit—we must takeover—colonise—grab more.
As a specific instance, when we colonised the ’empty spaces’ of Africa we took their energy sources in the form of slaves and muscle energy to work plantations. We can’t do that anymore, so the rich nations of the world are now recolonising Africa to extract the food energy from their land and ship it abroad, leaving the original landholders often destitute. The original slavers used their superior energy sources to drive the slave system, stacking slaves into big ships. We use our superior energy sources to do the same thing, pouring palm oil and wheat into big ships to denude the land they came from. In terms of energy utilisation, there is no difference between the two systems.
This is why globalisation can only continue so long as there is energy available to drive it.
You are right. Every species has an innate instinct to fill all of the spaces available to it, using whatever energy is available. We are simply doing what is instinctual–using resources as fast as possible, and growing our population as fast as possible. Unfortunately, this scenario can’t end well. After overshoot comes collapse.
“…only the scale of it is a recent phenomenon”.
It took me years of self-education on blogs like this to get my mind around the concept of “leverage”. I think few people get it, but it really explains what is so special about our times. I like it better than “scale”, but it’s really nothing different.
As a child, I was overwhelmed by the power my bicycle gave me over walking. Well, my muscle power was leveraged up many times, and by simple means. But back then, it was just cool! In my opinion, bikes are very elegant machines, because they use so few parts to get such a big advantage. But I also remember what happened when something broke – I had to walk again.
Most great inventions of humanity can be tied to that concept. The story is always the same: first you have to build something, oftentimes using complex engineering, then learn how to use it, but once in place the system gives superior returns. After some years, people get used to it, and take it for granted (like the PC and the internet).
Globalization uses whole continents to get leverage. The financial world has its own leverage by using cheap credit. But of course, the larger your leverage is, and the higher it lifts you up, the more vulnerable it becomes, and the more deep you can fall.
As cheap oil is (or was) one of the most effective leverage instruments, its end could of course threaten the whole system.
I think Joseph Tainter says it best : civilisations are destroyed by the complexity that created them
You summarized the situation well. Our problem is that leverage works until something in the system breaks.
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Another great post with facts no less. I like this post in particular because many comments are asking the larger question of how the world should be run(or more precisely how it should have been run)? Globalization could never work just because we live in a finite world. If in the fifties we could have truly realized our problem we might have dealt with it. But it wasn’t a problem then and wouldn’t be for a long time. In the fifties we were not truly conscious of sustainability, we were too busy trying to pull ahead personally. Anyway here’s another good quote from Jung:
The Great events of world history are, at bottom, profoundly unimportant. In the last analysis, the essential thing is the life of the individual.
This alone makes history, here alone do the great transformations first take place, and the whole future, the whole history of the world, ultimately spring as a gigantic summation from these hidden sources in individuals.
In our most private and most subjective lives we are not only the passive witnesses of our age, and it’s sufferers, but also its makers. We make our own epoch.
C. G. Jung 1934
Collected Works, Civilization in Transition
CW 10 para.315
Jung was the man who, when his rich wife died and he became alert to the possibility of dying ‘in poverty’, took lots of Swiss bank notes and buried them in valuable Chinese vases in various locations in his garden.
The notes rotted and the vases cracked, when he could remember where he put them. ….
This seems to sum up much about Humanity: mis-allocation of resources, irrational fear and poor strategic, planning all in one! (His books can be entertaining though, I agree.)
“I don’t think people who have been pushing globalization ever thought through what it really would do.”
??? – Since enslaving humanity always was, is still, and always will be their principle goal, we can surely assume that globalisation is seen as that which best facilitates the principle function of human enslavement … and also that much malicious thought has gone into the planned ‘one world’ tyranny… It’s also no accident that ‘Muftikultur’, is very effectively ethnically cleansing White cultures from their ancestral homelands by population replacement, and that Sharia ‘law’ seems likely to be chosen as the totalitarian social system best suited to administer a global hell on Earth
CARL JUNG. 1875 – 1961 Carl G. Jung stated: “The larger the organizations, the more inevitable are their immorality and blind stupidity.” “The larger a society or confederacy, the greater the amalgamation of collective factors – which is typical of every large organization – will rest upon conservative prejudices to the detriment of the individual, the more aggravated the moral and spiritual degeneration of the individual.”
Count Richard N. Coudenhove-Kalergi [Jesuit Black Pope] wrote’ a book in 1923 calling for a United States of Europe. This book contains the following words: “The future man will be a mongrel. As for a Pan-Europe, I wish to see a Eurasian Negroid mixture with great variation in [dysfunctional] personality types… (“Praktischer Idealismus,” 1925, pp. 22, 50):
The Jews shall take the leading positions, since Providence has given Europe a spiritually superior race of nobility called the Jews.” (The periodical “Pan-Europa” of Count Coudenhove-Kalergi)
Political Ponerology
“…the biological, psychological, moral, and economic destruction of this majority of normal people is a “biological” necessity to the pathocrats…”
“sacrificial tradition represents the domination of the ‘elite’ over the potentials of the ‘common’ people.”
Andrew M. Lobaczewski’s 1998 book entitled Political Ponerology (A Science on the Nature of Evil Adjusted for Political Purposes)
http://www.oldthinkernews.com/2010/12/a-window-into-the-mind-of-a-scientific-dictator/
I haven’t been studying this line of thinking. I tend to follow Hanlon’s razor, “Never attribute to malice that which is adequately explained by stupidity.” Perhaps I am naive, but I just assumed the economists didn’t think things through well enough.
Gail, I’m with you on the stupidity.
At one time in my life I studied a great many diplomatic and political documents, written at the highest level, about 100 years ago.
I was struck by the significant – in fact predominant – role played by misunderstanding and fantasy as opposed to machiavellian scheming and malice, and the power of the great Law of Unintended Consequences. Conspiracy theorists just seem to miss this……
Please don’t fall for the ploy of trying to get anyone who believes something to be a conspiracy as automatically not playing with a full deck. The longer we let those primarily responsible for 9/11 get away with it, the bolder they will become, and who knows what that might lead to.
Just to prove the point, watch the two Youtube videos by Architects and Engineers for 9/11 Truth: WTC 7 Freefall by David Chandler & WTC7 NIST Finally Admits Freefall (Part II) by David Chandler. When you do so, you will see why the official line on the collapse of WTC7 is physically impossible. WTC7 has to have been demolished by the use of explosives, or one of the fundamental laws of physics is wrong. That being the case, and seeing as the placement of that explosive, of which there must have been a considerable quantity, has to have been arranged by someone or some group on the inside and thus 9/11 was an inside job. From that it is clear that we need the whole event to be reinvestigated, properly this time. The freefall of WTC7 is just one of a considerable number of lines of evidence that lead to the same conclusion (Try Pilots for 9/11 truth and note what they say about the issue, including that of pilots with airtime on the actual aircraft involved. Particularly note the analysis of the FDR from American 77).
Do I like having to conclude that 9/11 was an inside job? Not in the least, but I have to go where the evidence takes me, or betray a principle that stood me well in a long career in automobile engineering where not doing so can result in your being on a manslaughter charge, with all that that could mean.
I have watched it. I am an engineer. The WYC collapse is simple progressive collapse triggered by heat failure of the steel structure. Steel is fireproofed to about 45 minutes. The structures stayed up about 45 minutes. Proggressive collapse has brought down many buildings and is of course a way to demolish them as well, using controlled explosives. But it doesn’t have to be.
You are right to see the sm8ltaoitroes with controlled demolition – the principles are the same, but heat will take out the structure as sure as explosives will. It just takes that 45 minutes to do it..
Yes, you are an engineer, an electrical engineer, so what? We cannot apply Kirchoff”s Laws to steel framed buildings in any meanful way, can we? On the other had, Kevin Ryan was a chemist and laboratory manager for Underwriters Laborotories, the company that certified the steel used to construct the twin towers and WTC7. His opinion conflicts directly with yours. If you don’t mind, I prefer to listen to him and the countless other lines of evidence that support his view rather than listen to someone who is clearly mistaken.
Perhaps you might like to spend some time visiting the Architects and Engineers for 9/11 truth website, where you will be able to access the views of experts in the field who clearly believe that there is something very wrong with the official line on 9/11, and despite the general view that all conspiracy theorists are mistaken because they are conspiracy theorists, have come out an stated their views on the matter.
It is significant that you choose to ignore the fundamental science behind the collapse of WTC7, the subject of the videos that I cited and which show clearly that explosives had to have been used to demolish that building. Perhaps you can explain the freefall collapse for over two and half seconds due simply to fire? Good luck with that. As the videos clearly show, NIST cannot. But of course you are an electrical engineer, so obviously better qualified to do so.
I suspect that this is yet anotheer case of your taking a ‘Don’t confuse me with the facts, my mind is made up!’ stance.’
‘Conspiracy Theorist’s’ – [aka: Millions of Human Beings, all throughout history, that constantly Witness Unscrupulous Psychopaths Undertaking Takeovers by Undermining Realities of Ordered Civilised Freedom] – are simply very much aware that the “One World” genocidal klepto-parasitic, anti-socially-engineering social-disgenic-“scientists of today think deeply instead of clearly. One must be sane to think clearly, but one can think deeply and be quite insane” [Tesla] and of course that all that is required for evil to continue to prevail is for good people to continue to do nothing and for the enslaved majority to continue to wilfully remain blind
PS – an example of an undeniable Conspiracy Fact –
Adam Weishaupt established a secret society called the Order of the Illuminati in 1776 The purpose of the Illuminati is to divide the goyim (all non-Jews) through political, economic, social, and religious means. The opposing sides were to be armed and incidents were to be provided in order for them to: fight amongst themselves; destroy national governments; destroy religious institutions; and eventually destroy each other. Their objectives are as follows: 1) abolition of all ordered governments 2) Abolition of private property 3) Abolition of inheritance 4) Abolition of patriotism 5) Abolition of the family 6) Abolition of religion 7) Creation of a world government.
Adam Weishaupt wasn’t just some world hating nut rambling away on a bus, he was one epic world hating nut and very connected and very influential – and we see the plan is now well underway with the balkanisation of the World into combinations of mutually bigoted and hostile victim minorities and ethnic groups; >”muslims””blacks””homosexuals” “narcissist liberals” “non-progressives” etc, in order to facilitate total social destruction from within – It really is no accident that political treachery and manipulation and unacountability along with increasing pathocratic social controls with attendant mass human deaths are becoming the default setting and if we won’t even recognise what the actual problem is and also the extent of our deliberate enslavement we can never be free –
For example-
138 Years of Economic History Show that It’s Excessive PRIVATE Debt Which Causes Depressions http://www.oneworldchronicle.com/?p=5484
I’m glad someone agrees. Stupidity seems to be rampant, even within academic settings. Everyone takes what someone else has written, and makes slight improvements on it. Peer review makes certain that new journal articles don’t deviate too far from what past journal articles wrote. The need for academics to generate N papers per year means that each paper will be only a slight variation on a previous one–the primary goal is quantity. Innovative is not very high in importance.
By way of support for your view about academics copying each other, consider how many linguists accept the dictionary definition of the tense of a verb as being an inflection that defines the time setting of the actions or states it describes. Yet a minute or two’s thought will tell anyone, including linguists, that the tense of a verb has absolutely no meaning whatsoever until its time setting is known, or has been assumed from context or intonation etc.
Obviously the first lexicographer defined tense wrongly and all the rest have just copied it without a minute’s thought.
Stupidity and evil are only two extreme ends on a scale of human behaviour. This happens on all levels – familiy, company, community politics etc. – individuals find out how they can manipulate a situation to their advantage. Doing that, they establish a network of people with complementary interests that even better serves them, and it all grows and develops it’s own dynamic. Now you can call that a conspiracy, but it’s just human behaviour.
That is a good point.
It seems to me that the super rich (individuals and transnational corporations) are now taking a supranational view of matters. This is what globalisation means. National boundaries matter much less to the super rich than national boundaries matter to the middle class, working class and poor. The international movement of people is still strongly controlled but the international movement of capital is much less controlled. At the same time, nations still matter and the disappearance of nation states does not at all seem to be on the cards.
So, we have this paradox of the fluidity of capital and the rigidity of security and defence boundaries (for that is what national bondaries are). Thrown into this is the issue of real resources. There is the empirical reality of where the remaining real resources are sited. They are all sited geographically in one nation or another (a truism of course). For all the current importance and fluidity of capital, a profound truth remains. Capital – like money – is not real, it is only notional. What will matter is the time when the chips are down (meaning when various resource reserves run up against real limits) and this begins to choke the real economy. The national (security and defence) possession of real resources will then matter more than the fluidity of capital.
So, I would expect to see a re-emergence of the importance of the nation state and increasing policies of protection and autarky particularly in the large continental or sub-continental nations with significant remaining resources. These nations include (in land area order) Russia, Canada, China, USA, Brazil, Australia and India. Of course, the real resource richness of these large nations is not necessarily comparable. The USA is a particularly rich nation geographically with enormous (comparatively) remaining reserves of oil, coal, minerals, soils, groundwater, aquifers, lakes etc. Australia on the other hand, though large in area, is mostly desert and poorly endowed in particular with fresh water and arable soils. Despite this, Australia has very significant minerals reserves and its non-arid arable area is still equal to the entire area of France.
These large countries will soon realise it is in their interests to re-introduce policies of protection and self-sufficiency. It makes no sense to export remaining resources in a severely resource limited world. Small countries with few real resources remaining (like Britain) which run on being financial centres are basically on a hiding to nothing. When world trade and finance collapse (as they inevitably will) then countries like Britain will collapse into severe poverty.
So, I expect globalism to collapse and the smaller resource-exhausted countries to collapse first. Over-populated countries like China and India will also soon face major problems. The US will literally have to build a wall between itself and Mexico and totally seal the border if it is not to be swamped by collapse refugees from Mexico and Central America. As anti-humanitarian as this appears real-politik will demand it. If you have a lifeboat that will float the current passengers but not the many still drowning and clawing to get in then you push them off with the oars and row away. It’s the survival of the fittest and the best placed.
Equally, I expect by the time I am 80 or even 75 (now 60) very few if any resources will be devoted to keeping me alive. I expect it and I agree with it. The younger people will be struggling to keep themselves going. Quite correctly, they will see it as absurd and impossible to devote extra resources to keeping old, useless people alive.
Hi Ikonoclast
As I read your comment, I had this vision of some Arizona militia men, armed with their favorite Bushmasters, standing at a border crossing. From the south comes a speeding pickup filled with agricultural workers who are trying to crash through the border to earn money picking grapes. From the north comes a speeding pickup owned by Hewlett Packard (HP) with a bale of US currency worth $100M that is determined to crash through the border to build a PC manufacturing plant south of the border. The militia men will only have time to fire upon one pickup – which one do they perceive to be the greatest national threat?
You may very well be right. It hasn’t been as clear to me that the nation-states would stay together. It would seem like the areas with resources would like to keep them for themselves, and not share them too broadly, especially if the resources are limited. Of course, there is considerable interdependence among areas, so individual areas may not be able to “make it” on their own. They need to have the benefit of a larger area, even if transportation is more difficult. It may depend on whether a nation state undergoing financial difficulties can stick together, perhaps under a different form of government, without falling apart.
There is definitely an issue of how a particular area can keep population down sufficiently so the people living there can survive. If one particular area is good for survival, there is likely to be a great influx of outsiders, endangering survival for all. About all one can do is put up fences or walls, and hope for the best.
I think the more integral and stable nation states will survive for a while yet, say 50 years anyway. It’s a bit hard to predict anything beyond that. But plenty of states will fail well before then. Somalia and Haiti are two examples of currently failed states. To the extent that they might still appear to be viable states, this is achieved by their being propped up from the outside. Soon, the bigger states will be busy keeping themselves together. There will be no spare resources to prop up failed and failing states.
The failed states alert index gives a list worth watching. I would expect most of the “top 40” to fail within ten to twenty years.
Footnote: It’s interesting to note that of the “sustainable nations” only Australia and New Zealand are safely in the southern hemisphere away from collapsing neighbours and surrounded by protective ocean “moats”. In the long term, Australia and New Zealand might be the only viable places to be. The northern hemisphere will be a wasteland.
I suspect that if the time-frame were long enough, and Australia and New Zealand really did stand out as possible survival locations, they would be invaded and colonised by larger states who would have no scruple in doing so.
A very sudden collapse which incapacitated foreign militaries would be a different matter.
So many people who discuss ‘transition’ and ‘survivalism’ seem want to know which corner they and their families can run to, just as my super-rich friends think only of the next great investment or secure asset and blot out the bigger issues. There is a clear biological mandate to think like this.
I feel it’s perhaps better to let go, and accept. I come from a long line of soldiers, and I think I have a gene somewhere that says ‘face the danger even when you can’t get out of it, some battles you are not going to survive.’ Being half-Spanish, it’s possibly the famous ‘Spanish Fatalism.’
Not that I’m a pessimist in any sense, just as much of a realist as I can manage! In the same way that Gail presents unpleasing facts in a dispassionate way.
A lot of the survivalist line of reasoning seem to be around, “If we just use less oil, it will be OK,” or “If we substitute electricity for oil, we will be OK.” I see the issue as being a breakage of the system that allow our current way of life to go on. Very often, the breaks will occur because of financial problems of either a government or business. Or civil war may break out. Another kind of break may be one where a huge number of people are laid off from work, and cannot afford basic services.
I expect oil and electricity will encounter problems within a few years of each other, if not at the same time. Relying on electricity to substitute for oil is very risky, IMO.
Another consideration is that we are married to an economic philosophy that allows a relatively few to control the means of production and the movement of money. This means that even in the best globalization scenario, enormous quantities of wealth accumulate in the hands of a small number of entities, effectively denuding the vast middle class (and “Main Street” economy) of vital income necessary to fuel the job creation engine of the domestic economy. This, of course, contributes mightily to the situation that we’re dealing with here in the United States (even if the long-lasting effects of the Great Recession were somehow excised from the economy).
I think part of what you are talking about is the fact that poorer people are often paying money for loans, and it is a relatively small group of people at the top of the pyramid that get the benefit of the interest payments. In some ways, this situation has always been the case, but the financiers have been more creative in recent years in coming up with new “products.”
Maybe this post should have been named ” 12 reasons the United States 5% doesn’t wants to share Our Finite World resources, but we don’t want to give up products make with cheap foreign labor”.
Perhaps, LOL. I don’t think people who have been pushing globalization ever thought through what it really would do.
No, it should be ‘how did our oil get under other people’s deserts?’
Hmm. Many of the things you cite as problems are in fact to the developing world, solutions….
And yet other things are only problems if you BELIEVE in AGW…
So there is plenty of room for debate.
BUt there is a simpler way of looking at this: Globalisation simply arbitrages differences in material resources , technical proficiency, and living standards across the world. And without the world government the Liberal UN wants to impose, the tendency is to erode the power of national governments anyway. AS well as giving them the greatest excuse of all -“its them lot over there wots causing it!”
In essence Globalisation means rising living standards the the developing world and falling living standards in the developed world. Without protection national blue collar workforces in the West simply see their jobs offshored.
IN short wherever there is a totally free market the jobs will go to those who are in possession of the requisite skill set and charge the least for their services. And with multinationals the profits will accrue in whatever country has the lowest tax regime.,arbitrage in labour rates, skills and tax regimes..leading as you say to a race to the bottom.
I think it is a little misleading to tie it into resources though. It is an independent variable.
As transport got cheaper the natural barriers to trade disintegrated, and areas of low cost production naturally flooded to areas of high consumption. IN the end it will all even out.
The challenge – leaving aside the energy things, which are a dominant, but independent, issue, is to find something that any given geographical area can do better than anyone else and at lower cost. Nations or states that fail to arrive at that, and seek to shelter behind effective transfer economies in large socialised economic blocs, will in the end be nothing but dead weight on the rest.
Which is not a recipe for harmony in those blocs, as the Soviet bloc, and now the EU, are discovering.
Globalization is great from the point of view of a developing country. There are several catches though (1) It builds dependency on resources that won’t last, (2) It builds dependency on countries that are themselves likely to collapse, (3) There is always someone one rung lower on the ladder than you are. Even if China has been benefiting from globalization, the tendency will be to keep moving to even lower-cost areas, such as Bangladesh and India. At some point China becomes too high-cost.
The pollution problem is a bigger one than AGW. Unbreathable air is a problem in metropolitan areas of developing countries. Ocean acidification is another. Pollution because of industrial processes is another. Globalization encourages a rush to the bottom in this area as well.
One difficulty in the rush to the bottom, is that those living in warm, humid climates necessarily have an advantage. They can get along without warm clothes, sturdy homes, and big cars for transport. This difference alone makes it harder for developed nations to compete.
The pollution problem, by which I assume you mean smog, is closely related to AGW. Get rid of it and the sun will come through and push the temperatures higher – hardly a win win situation. In any event, it is an acute problem which,given the will, we can fix. The CO2 that was produced at the same time is a chronic problem which will be with us for many decades. Those who study the subject for a living are coming to the concensus that we are in for about 4C to 6C temperature rise by the end of the century. I just cannot see how that is not worse than the smog, bad as it is. On top of that we have the ocean acidification and sea-level rise problems to contend with. Not to mention the increase in extreme weather events, which is going to give farmers a hard time just when we are going to need them to most efficient. They won’t know whether to plan for drought or deluge. All they will know is that it is likely to one or the other.
You mention elsewhere that the coming crash will help solve the climate change problem. Not if we have passed the tipping point for permafrost melting beforehand it won’t. All we will be able to do then is cling on and try and enjoy the ride.
The world will do just fine with whatever climate it ends up with. It is the nature of a finite planet to cycle from one climate to another. New species will become top species. The species that survive and flourish will likely be ones that view our pollution as something that they need for survival. Perhaps the new top species will be plants of some sort, since plants can use carbon dioxide.
Climate change is a problem only from the perspective of humans. If severe climate change happens, and there are still lots of humans, living in our current locations, growing our current crops, using our current machinery, I agree that climate change will be a major problem.
My problem is that it looks to me as if such severe changes are coming in the very near future that it is highly unlikely that the assumptions in the previous paragraph are anywhere near right. In addition, I am not convinced that there is anything we really can do. Tell everyone that one family in 100 should have a child? Won’t work! Cut back our own coal use, while the rest of the world continues its coal use? Not enough difference to matter. Other countries would import our coal, or fifty years from now, people here would start using it again. I think climate change is already happening, and I am not terribly convinced that we collectively can do anything to change the situation. We don’t have enough power over humanity. Using fossil fuels has too much benefit, and adequate cheap substitutes are not available. Adding a lot of intermittent renewables to the grid is not a solution, in my view. It will just bring down the electric grid sooner. The only possible solution would be to get people to drop fossil fuels (including electricity, which depends on fossil fuels) completely, but this is not going to happen.
Gail, sadly, I think you could well be right about the inevitability of climate change. Let’s face it, it is clearly happening, yet even among those who comment herein we have a Cambridge University graduate in a science subject (with a Masters if I remember correctly) who, despite having been pointed towards an excellent website, skepticalscience.com, run by scientists dedicated to disseminating the latest science of climate change, including the myths about it, clearly still doesn’t believe in it. If such a person can take a “Don’t confuse me with the facts, my mind is made up” stance, what chance do we have with the average citizen? And what awful individuals the media people are who take advantage of same to push their ill-informed positions on the subject. You have to be pretty desperate for advertising revenue (or stupid) to endanger your own children in order to get it.
I will continue to fight for action in the hope that we can reverse climate change. As a parent that is something that I am obliged to do. It is becoming ever clearer to me that when my son is my age, he will be living in quite poor climatic conditions that will be influencing all areas of his life. At least he will not be able to say that his dad didn’t care. The irony is that thanks to the British Daily Mail, he thinks climate change is all a hoax! (Kids are the screwing you get for the screwing you got.)
I would rather just omit the subject of climate change. If there is really nothing we can do, and fossil fuel use will decline rapidly in the future regardless of what we do because of collapse, then running around talking about the subject just distresses ourselves, and does no real good. In fact, the amount of fossil fuel use seems likely to decline far below what all of the models are assuming regardless of what we do now. This is inherent in the upcoming collapse.
I am not entirely convinced that the climate models are very accurate. If fossil fuel use is likely to be a lot lower than what they are forecasting, I suppose a could go around saying, “Climate change will only be X degrees instead of Y degrees, because of the collapse that is coming. I am not sure that is really true–I am not certain the models are not really all that good. But I expect that the changes that will be happening in fossil fuel consumption will be greater than what they are hoping for, at least partly because there will be fewer humans. The humans that are left will most likely need to leave cities on the coast for reasons other than rising sea level. The humans that are left will need to make huge changes to agriculture anyhow. Pouring huge amounts of money into one scheme or another now (more wind for electricity is popular) seems to me to be a huge waste of money, with very undesirable side-effects, like destabilizing the grid that we do have now. If I saw good solutions that we could adopt cheaply, I might be more enthusiastic about the whole subject.
Thanks for yet another lucid post.
We live at a time of extreme irrationality.
For instance, near my house in England, large areas of hitherto protected and valuable agricultural land is going to be concreted over to build massive developments which are – of course – said to be essential for ‘growth.’
This is also planned for much of the country, so desperate or deluded are our rulers and their short-termist and self-interested advisors.
From every angle of consideration this is insane, there is no need to elaborate on the reasons to people who are here. One might consider that Britain is only 60% food self-sufficient for a start, but could be 95% if agriculture were prioritised (leaving aside oil-dependant vulnerabilities for a moment.)
So, loss of good land, and acquisition of more infrastructure built to very poor standards and costly to maintain.
Even when the issues are starkly clear, national and local governments persist in takin the wrong decisions, so little do they wish to face unplatable truths, and so desperate are they to employ people.
This is why I just cannot give credence to the idea of a ‘managed decline/transition.’
Such misguided systems can only lurch into sudden shock and disaster, as far as I can see.
I agree with you that people keep making very strange decisions. Adding yet more sports stadiums is one of them. How can we afford to build more of them, and teams and fans travel to games for years ahead to pay for them? What real benefit do these have, except the elusive lure of more spending by fans–spending that might theoretically be somewhere else, if it weren’t in the stadium?
If it were possible to find a lower level, and everyone aim for it for several years ahead, there theoretically could be at least some sort of managed decline. But people would be shocked at how much lower this would need to be, and current businesses couldn’t make profits at the lower level. Few of us would have the right training for the jobs in the managed decline scenario. So no one would support it. The alternative is to crash to what may be a very low level.
ultimately groups of people tend to distrust one another, but put up with minor problems as long as there’s ‘enough to go round’, when there isn’t, annoyance quickly descends into hatred and mob violence and outright revolution against ‘those responsible’
this is where preachers and politicians find the seedbeds of hate.
Dear Gail,
In figure 6, I don’t get what you count as “oil production” : how come the figure only gets to +/- 75 Mb/d ? Is it only conventionnal oil ? Is so, where does the EIA publishes separated figures for conventionnal only (as far as I know, they publish worldwide figure for “all liquids” only…) ? Thank you by advance !
Great work.
Matthieu.
Figure 6 is labeled “Crude Oil,” which is what it is. The EIA publishes several types of statistics. The old fashioned, traditional one is “Crude and Condensates,” which is what these numbers are from. US oil production on Figure 5 is also on this basis. For many years, this was the standard way oil production was shown.
Once it became clear that oil production (as narrowly defined) would be a problem, the EIA and other agencies like the IEA decided to come up with a broader category that encompassed “things that are sort of like oil”. Most of these have less energy per gallon or barrel, so really shouldn’t be added in with oil on a volume basis. It would be better to add them in based on their energy content. In fact, the EIA publishes US amounts also on an energy content basis, and makes its own energy forecasts on an energy-content basis. On this basis, the add-ins are worth much less.
I should also point out that much of the non-crude oil portion of liquids cannot be used to power vehicles. Instead, it is more like propane and butane, that are used for space heating and other uses. Other liquids also includes ethane, which is something which is now in over-supply. It can be used to make plastics, among other things.
Biofuels are also in this category, as is “coal to liquid” and “natural gas to liquid”. Another (fairly large) part of the category is “refinery expansion.” It is the additional volume that is added, when a country such as the US refines oil, especially by cracking heavy oils. There is not really an energy addition at all. Much of the US volume expansion has to do with the expansion of oil that was imported. If these imports were to stop, so would the refinery expansion related to them.
The publication of “total liquids” volume seems to have been put in place to help make oil production figures “look better,” especially for the US.
Ok, thanks. I did the same thing you did with EIA’s “all liquids” : the result is roughly the same. Notably, the increase in Middle East since 2008 is offset by the decline in the North sea :
http://petrole.blog.lemonde.fr/2013/02/27/la-production-totale-des-5-majors-du-petrole-est-en-declin-depuis-2004
(also in this post :
The production of the 5 top oil “majors” peaked in 2004, is down 25,8 % since
http://petrole.blog.lemonde.fr/2013/02/27/la-production-totale-des-5-majors-du-petrole-est-en-declin-depuis-2004 )
Going forward, it seems unlikely that either the Middle East or Russia will increase production by much. When the IEA report came out last fall, talking about the wonders of North American oil, it was in the context of not having much to say about great prospects elsewhere.
Dear Gail,
As far as I know, no mainstream media bothered to underline it, yet in WEO12, the IEA forecasts a possible decline of many heavyweight oil producers, notably Russia and Iran :
http://petrole.blog.lemonde.fr/2012/11/21/lagence-internationale-de-lenergie-annonce-le-declin-de-nombreux-pays-petroliers-majeurs/
(excuse my French)
That is a good point. I should write about this as well. I understand early reports suggest that oil production for the first two months of 2013 is down relative to the first two months of 2012, by about 600,000 barrels a day. This is about the amount of Iran’s production drop, I believe.