On August 6, I wrote a post called Making Sense of the US Oil Story, in which I looked at US oil. In this post, I would like to look at other sources of US energy. Of course, the energy source we hear most about is natural gas. We continue to be a net natural gas importer, even as our own production rises.
US natural gas production leveled off in 2013, because of the low level of US natural gas prices. In 2013, there was growth in gas production in Pennsylvania in the Marcellus, but many other states, including Texas, saw decreases in production. In early 2014, natural gas prices have been higher, so natural gas production is rising again, roughly at a 4% annual rate.
The US-Canada-Mexican natural gas system is more or less a closed system (at least until LNG exports come online in the next few years) so whatever natural gas is produced, is used. Because of this, natural gas prices rise or fall so that demand matches supply. Natural gas producers have found this pricing situation objectionable because natural gas prices tend to settle at a low level, relative to the cost of production. This is the reason for the big push for natural gas exports. The hope, from producers’ point of view, is that exports will push US natural gas prices higher, making more natural gas production economic.
The Coal / Natural Gas Switch
If natural gas is cheap and plentiful, it tends to switch with coal for electricity production. We can see this in electricity consumption–natural gas was particularly cheap in 2012:
Coal use increased further in early 2014, because of the cold winter and higher natural gas prices. In Figure 2, there is a slight downward trend in the sum of coal and natural gas’s share of electricity, as renewables add their (rather small) effect.
If we look at total consumption of coal and natural gas (Figure 3), we find it also tends to be quite stable. Increases in natural gas consumption more or less correspond to decreases in coal consumption. New natural gas power plants should be more efficient than old coal power plants in producing electricity, putting downward pressure on total coal plus natural gas consumption. Also, we are using more efficient lighting, refrigerators, and monitors for computers, holding down electricity usage, and thus both coal and gas usage. Better insulation is also helpful in reducing home heating needs (whether by electricity or natural gas).
Another factor in the lower electricity usage (and thus lower coal and natural gas usage) is fewer household formations since 2007. Young people who continue to live with their parents don’t add as much electricity usage as ones who set up their own households do. Low household formations are related to a lack of good-paying jobs.
Coal Production / Consumption
US coal production hit its maximum level in 1998, with production tending to decline since then. US coal consumption has been dropping faster than production, so that exports (difference between production and consumption) have been rising (Figure 4).
In 2012, about 16% of coal produced was exported. This percentage dropped to about 10% in 2013, with greater US coal usage.
Coal tends to cause pollution of several types, including higher carbon dioxide levels. It also tends to be less expensive that most other fuels, so world demand remains high. Worldwide, coal use continues to grow.
Nuclear and Hydroelectric
Hydroelectric is the original extender of fossil fuels. Hydroelectricity using concrete and metals became feasible in the 1800s, when we began using coal to provide the heat necessary to make metals and concrete in quantity. The first hydroelectric power plants were put in place in the US in the 1880s. As recently as 1940, hydroelectric provided 40% of the United States’ electrical generation.
Nuclear electric power was the next major extender of fossil fuels. The first nuclear power was added to the US energy mix in 1957, according to EIA data. The big ramp up in nuclear began in the 1970s and 1980s. Similar to hydroelectricity, nuclear requires fossil fuels to build and maintain its plants making electricity.
If we look at the US distribution of fuels, we see that in recent years, nuclear has been a much bigger source of energy than hydroelectricity.
The above comparison includes all types of energy, not just electricity. The grouping GeoBiomass is a BP grouping including geothermal and various forms of wood and other biomass energy, including sources such as landfill gas and other energy from waste. Note that GeoBiomass, Biofuels, and Solar+Wind are hard to see on Figure 5, because of their small quantities.
If we look at hydro and nuclear separately for recent years (Figure 6, below), we see that nuclear has tended to grow, while hydro has tended to fall, although both now seem to be on close to a plateau. Hydro tends to be more variable than nuclear because it depends on rainfall and snow pack, things that vary from year to year and month to month.
The reason why hydro has tended to decrease in quantity over time is that it takes maintenance (using fossil fuels) to keep the aging power plants in operation and silt removed from near the dams. Most of the good locations for dams are already taken, so not much new capacity has been added.
Nuclear power plant electricity production has grown even since the 1986 Chernobyl accident because the United States has continued to expand the capacity of existing nuclear facilities. I do not expect this trend to continue, for a variety of reasons. Not all such capacity expansions have worked out well. The capacity expansion of the San Onofre plant in California in 2010 experienced premature wear and is now being decommissioned. Many of the nuclear plants built in the 1970s are reaching the ends of their useful lives. Unless we add a large number of new nuclear plants in the next few years, it seems likely that US generation of nuclear electricity will be falling over the next 20 years.
Other Energy Types
It is easier to see other energy types if we look at them as a percentage of US total energy consumption. The following is a graph of “renewables” as a percentage of US energy consumption, using EIA data:
A person can see that over the long haul, hydroelectric has tended to shrink as a percentage of energy consumption, as energy needs grew and hydroelectric failed to keep up.
The GeoBiomass category is BP’s catch-all category, mentioned above.1 It (theoretically) includes everything from the wood we burn in our fireplaces to the charcoal briquettes we use to cook food outdoors, to home heating with wood or briquettes to the burning of sawdust or wood pieces in power plants. It also includes geothermal, which is about 6% as large as hydroelectric, and is increasing gradually over time. Based on EIA data, biomass isn’t growing either in absolute amount or as a percentage of total energy consumed.
Biofuels are liquid fuels made from biomass used to extend oil consumption. In the US, the major biofuel is ethanol, made from corn. It is used to extend gasoline, generally up to 10%. A chart of production and consumption shows that US biofuel production “topped out,” once it hit the 10% of gasoline “blendwall”.
Biofuels now amount to 5.7% of US petroleum (crude oil plus natural gas liquids) consumption. In recent years, the US is a slight exporter of biofuels.
Corn ethanol currently takes about 40% of US corn production, according to the USDA (Figure 9). Greater corn plantings would put pressure on land usage for other crops.
If someone figures out how to make cellulosic ethanol cheaply (perhaps from wood), it presumably will cut into the market for corn ethanol, unless the blend wall is raised to 15%. Without additional ethanol coming from a source such as cellulosic ethanol, such an increase in the maximum blending percentage would likely be problematic.
Wind and Solar PV
Wind and Solar PV are sources of US electricity, so really need to be compared in that context. If we compare nuclear, hydroelectric, and all renewable electricity other than hydro (including electricity from wood, sawdust, and waste, and from geothermal, in addition to wind and solar) we see that in total, all other renewables are approximately equal to hydro electricity in quantity:
If we look at the pieces of other renewables separately, we see the following:
Wind energy has indeed grown in quantity. Solar/PV is growing, but from a very small base. The remainder, which includes geothermal, wood and various waste products, is growing a bit.
A major issue with wind and solar is that we badly need a “solution” to our energy problem, so these are “pushed,” whether they are really helpful or not. Some issues involved:
(a) Cost effectiveness. Studies (such as by Brookings Institution, Weissbach et al., Graham Palmer) show that wind and solar PV are not cost-effective for reducing carbon emissions. If we want to reduce carbon emissions, conservation or switching from coal to natural gas would be more cost effective.
(b) Peak supply or peak affordability (demand in economists’ language)? The peak oil “story” often seems to be that because of inadequate supply, oil and other fossil fuel prices will rise, and substitutes will suddenly become competitive. This story is used to support a switch to wind and solar PV and high priced biofuels, since the expected high prices of fossil fuels will supposedly support the high cost of renewables.
Unfortunately, the story is wrong. High prices of any fuel tend to lead to recession because wages don’t rise to match the high prices. Also, a country using the high-priced fuel tends to become less competitive compared to countries that don’t use the high-priced fuel. The net effect is that prices don’t rise very much. Instead, manufacturing moves to countries that use less-expensive fuels. Oil prices may fall so low (relative to the cost of oil production) that oil producers sell their land and increase dividends to shareholders instead; in fact, this seems to be happening already.
(c) Hoped for long-term life. If fossil fuels have problems, can “renewables” have long life-spans in spite of those problems? Not that I can see. It takes fossil fuels to maintain the electric grid and to produce any modern renewable, such as wind, or solar PV or wave energy. Wind turbines need frequent replacement of parts, and solar PV needs new “inverters.” Wood and biomass will have long lives, if not overused, but these won’t keep the electric grid operating.
(d) Apples to oranges cost comparisons. There are a few situations where wind and solar PV are used to substitute for oil–for example, on islands, where oil is used to operate electricity generation. In these cases, wind and solar PV are likely already competitive, without subsidies. In these situations, per capita use of electricity can be expected to be very low, because exports made with such high-priced electricity will be non-competitive in the world market-place.
The confusion comes elsewhere, where substitution is for natural gas, coal, or nuclear energy. Here, the savings to an electric company is primarily a savings in fuel cost, that is, the cost of the natural gas, or coal or uranium. The plant’s manpower needs and its cost of electric grid maintenance will be the same (or higher). There may be costs associated with monitoring the new sources of electricity added to the grid or additional balancing costs, and these need to be considered as well.
If we want to maintain the electric grid so we can continue to have electricity for a variety of purposes, the “correct” credit for intermittent renewables is the savings to the power companies–which is likely to be close to the savings in fuel costs, or about 3 cents per kWh on the mainland United States. This is far less than the “net metering” benefit (offering a benefit equal to the retail cost of electricity) that is often used for grid-tied solar PV. It is also generally less than the “wholesale time of day” cost of electricity, often used for wind.
Germany is known for its encouragement of wind and solar PV, using liberal funding for the renewables. This approach has adverse ramifications, including high electricity costs, less grid stability, closure of some traditional natural gas power plants, and rising carbon dioxide emissions. A recent article called Germany’s Electricity Market Out of Balance by the Institute for Energy Research summarizes these issues.
It would be great if we had a solution for our non-oil energy issues, but we really don’t. The closest we can perhaps come is scaling up natural gas consumption some, and reducing coal’s current portion of the electricity mix. We currently have a large amount of coal consumption relative to natural gas consumption (Figure 3), so we ourselves have good use for rising natural gas production, if it should actually take place.
The “catch” in scaling up natural gas consumption is a price “catch.” If the price of natural gas price rises too high relative to coal, then electricity production starts switching back to coal. If, on the other hand, natural gas prices don’t rise very much, not much of an increase in production is likely to be available. Producers would like to export (a lot of) natural gas to Europe, as a way of jacking-up US natural gas prices. This seems like a pipe dream. See my article The Absurdity of US Natural Gas Exports.
Nuclear is a big question mark. If the United States starts taking much nuclear off line, it will leave a big hole in electricity generation, especially in the Eastern part of the US. Germany and recently Belgium are starting to experience the effect of taking nuclear off line. It is hard to see how wind and solar PV can play a very big role in offsetting the nuclear loss.
Politicians need to have a “solution” they can call an energy savior, but it is hard to see that renewables will play more than a small role. Biofuels seem to have “topped out” for now. Wind and solar PV are still growing, but it is hard to justify subsidies for them, as part of the electric grid system. Solar PV does have uses off grid, if citizens want their own source of electricity, with their own inverters and back-up batteries. There are also business uses of this type–for example, to operate equipment in a remote location.
I have not tried to cover all of the various smaller items. There may also be growth possibilities for items that I have not discussed, such as solar thermal for heating hot water, particularly in warm parts of the United States.
 I have used BP’s GeoBiomass grouping for convenience, but I am adding together EIA data amounts. What is included in the “biomass” portion of GeoBiomass seems to vary from agency to agency (BP, EIA, IEA), because of different definitions of what is included. For example, is animal dung burned as fuel included? Is fuel that is gathered by a family, rather than purchased, included? I am using EIA data for US renewables in Figure 7, since its long-term data series is probably as good as any for the US.
i’d just eaten a boiled potato and half of another, the other half lay on the driver’s side seat, salted and peppered
the guy comes up with the girl, he wants her to get in the car so he can do her, but she doesn’t want to
i say, “get in the car, you can have his potato”
she looks at me and her eyes become very still, a massive awareness dawns and grows in them until that’s all i can see
then i woke up
a collapse dream, maybe
Here by the way, is “Thriving in the Age of Collapse” written by Dmitri Orlov in 2005.
It’s relevant to the collapse scenario we paint in this blog.
I will try to persuade my wife to read it.
Very interesting posts. I have the joy to say Argentina brings good news. Excess sovereign debt jubilee has begun
Either “developing countries” go bankrupt and cut off from financing or they risk stability of the overleveraged financial sector (hedge funds, banks and stock exchange). Not an easy choice, I would say.
Seriously good news indeed!!! Respondents to the article criticise the UK for likely not supporting the debt jubilee, but Argentina today, the UK and USA etc tomorrow, so they are fools to block the movement for restructuring debt. It’s also a grand poke in the eye of the wealthy elite criminals.
not to spoil the fun -you know I’m wholeheartedly with you- but when I read the last paragraph of the article:
“Eric LeCompte, executive director of the religious anti-poverty group, Jubilee USA said that the new framework was a promising sign. “The ICMA shows there is a global consensus against predatory funds and holdouts. It’s an important step, but we need actual laws in the United States and across Europe to end the behaviour,” he said.”,
I really hope you don’t rely on Washington & Brussels’ approval for validation of the process. I hardly imagine the lobbyists there enthusiastic with such idea.
That being said, it’s not a sufficient argument to cease the fight. Hold out!
There is a way out for the central banks, but it’s the nuclear option, and they are afraid to use it, because it would reveal their machinations.
Basically, to print as much fiat currency as needed to satisfy all debts worldwide, let the price of gold rise, and then allow the currencies to be backed by gold at a much higher price.
They can save parts of the system this way, but they might sacrifice themselves in the process because the mob will demand heads.
“Mob will demand heads” not everywhere and if blamed on “world crisis” featuring “fire starter ubervillain” such as Russia, China, Iran.. There has been several good articles on this topic in recent years, including the hypothesis of poking the other side deliberately to start such shift, Ukraine as classic exhibit with potential to provoke the other side to move first, actually we have heard confirmation of such consequences directly from the gov circles of the sinorussian axis.
The scenario you describe is therefore quite likely given the steps of major players up to date. However, it is from J6P (me) absolutely unpredictable game in detailed implementation globally. For instance, China is going to take over the pricing mechanism in PMs over few next years, however the infrustructure and gov policy has been already deployed, it’s operational (imports, mining, laws, vaults, trained employees), people are ready and informed by massmedia. I guess the minimum position starts at roughly 100grams or so, which is about orders of magnitude less than the current western trade system geared only to super institutional level. Now the crucial detail is, that we can have sort of working umbrella global system formed of say 2-3 semi autarcic blocks of adversary countries, where for instance in the west dominion you won’t be as individual legally allowed to trade anything bellow 1.000 – 12.000 grams, that’s 99% elimination of the poor and former middle class right there. So by that meassure the only front loading people are the big banksters/megabusiness/governments. Plebs will be just issued a new paper and digital currency tied to this global reserve system with obviously only pitifull real purchasing power of yesterday.
Call it a reset/collapse/financial armagedon whatever, but after few weeks if you can still feed a family with the help of caloric rations, it’s not such a big deal. For residents of China, Singapore, Russia, Iran, Switzerland, perhaps Turky and Gulfies this could be viable mode of wealth protection and diversification. But to follow the same for the generalist western pauper of NA/EU it could be a disastorous mistake and complete dead end, either ending up under “calamity windfall profit” taxation scheme or other forms of capital controls to deal with hoarders.
Skills, tools, land preferably unfit for at least first wave of collectivization is the better bet imho in the NA/EU part of the world, it’s sad but that’s the way I see it.
The great paradox unwinds as west goes openly authoritarian and collectivist while the east enjoys for a while some hybrid system of relative economic freedoms and stability.
Interesting view. Collapse under control. Authoritarian state seems inevitable at some point. Much less brutal and dramatic than Paul’s predictions.
There are some things here, which I can’t assess.
– systems theory approach – the more complex system, the more sudden collapse,
– long supply chains to maintain production of almost everything,
– local riots and revolts.
Any thoughts how TPTB is going to achieve control over these issues?
Actually not my predictions.. more like Korowitz’s … p.56 onwards http://www.feasta.org/wp-content/uploads/2012/06/Trade-Off1.pdf
Central banking gimmicks can kick the can — as we have seen over the last 6+ years…
But these gimmicks do nothing to decrease the production costs of a barrel of oil.
Central banks can play all the games they want but this does not attack the disease.
The symptoms of the disease are mostly financial in nature — even if you could fix those — that changes nothing.
I would argue that you do not want to meddle with what the central banks are doing — because they are doing EXACTLY what is expected of them — and that is keep this hamster running as long as possible – print money — throw money from helicopters — do whatever it takes — because once they change course — the symptoms go terminal — we get a financial implosion the likes the world has never seen…
The global economy collapses – the supply chain collapses — and the oil that is in the ground – stays in the ground — and the die-off begins.
The reason for current splitting of Ukraine or United Kingdom is energy. The same was when the Czechoslovakia split into Czech Republic and Slovak Republic: the Czech Republic had less energy intensive industry and more energy resources, the Slovakia had more energy intensive industry and less energy resources.
The depletion continues and the eastern part of the Ukraine (with coal deposits) or the Scotland (with oil) faces the same fate as the formerly energy rich regions of the Czech Republic – industry and population decline, as the easy to extract energy resources have already been extracted.
Scotland: http://www.transportscotland.gov.uk/report/j7106v2-02.htm (Table 5.2: Forecast Population Change by Local Authority Area 2003 – 2016)
Czech Republic: http://sreview.soc.cas.cz/uploads/8422e02854eb8a803dc42b920b774dc2305595f1_12-5-05Rumpel18.indd.pdf (the article about Ostrava – the heart of the hard coal mining in the Czech Republic which is now “a shrinking city”)
It is illusionary to think the break up will stop something. It cannot delay the results of energy resources depletion for Scotland or Eastern Ukraine. The Scotland or Eastern Ukraine must sacrifice more and more energy for resource extraction. They have less and less energy for the whole Ukraine and for the whole United Kingdom.
I am affraid that this break up process can not be stopped. It seems that for some people it is hard to realise the fact that the resource extraction is more and more dependent on the debt anyway. Who will provide them enough loans for energy resource extraction and processing when it seems that their resources are less and less attractive?
To stop believing that the past can not be revived is difficult…
After all, recent the past – the golden, expansive 1950’s and 60’s in the West, when one could leave any job and get another straight away the next day, or even the illusory credit booms of the 90’s and early 2000’s, lots of credit, lots of consumer toys, – were so pleasant for so many people in the advanced economies that it is very uncomfortable indeed to realise that it will not come back.
The ‘anti-Austerity’, ‘anti-Neoliberal’ parties in Europe essentially are promising that the past can be revived, that it is only policy errors by Brussels, and the wicked plans of capitalists and bankers, that are making things hard for ordinary people (public cuts, precarious employment at low wages, rising basic living costs, poor pensions or none, etc).
An uninformed electorate will jump at that promise in desperation: for instance, the massive vote, crushing all opposition, which the Spanish Right got in the last elections was largely due to fear of decline, and the belief that they alone ‘know how to handle the economy.’ Bad move! They are using that majority to introduce a police state in which all protest is made either illegal or impractical.
Then, maybe, as the decline accelerates, the masses (above all the failing middle class, and formerly secure skilled workers ) will grasp at some kind of populist dictatorship (‘Left’ or ‘Right’ is irrelevant) promising the same thing, the return of the Golden Age, and similarly failing. It’s interesting to see what the French Right seem to be offering: ‘Policies for France, made by French people, for the French people’, in other words a denial of globalism, of interconnectedness, of the movement of history, and playing to a childish belief that the right policies will have the effect of restoring what has been irrevocably lost at this late stage of globalised industrialism and resource depletion.
A bit of contradiction there in your post.
Le Pen wants return or rather change of direction towards semi/quasi autarky. For starters independent foreign policy (kicking certain clique of “internationalist” out of the entire gov structure), deconstruction of many/most of the centralized bureau euroarea trade dictats etc.
You can’t deny globalism when it’s failing already and on the way to regionalism etc.
That’s the direction of “movement of history” now. Is Le Pen naive, perhaps a lot, but the fun part being that her “wrong” model is more compatible with the future world of less consumption. Yes it’s indeed. So, what’s the problem?
Looking forward, the airline industry (european consorcium) likely won’t survive anyway, the same for most of the car production, also loss of EU collected farming subsidies will be hard but more important question long terms is climate change effects on this part of Europe. Nuclear industry could be kept alive for a while with expedition force as of today (uranium mines in Africa) and/or with some sinorussian alliance. Shipyards are dead as we have seen recently. So, the future is very low speed, pastoral, perhaps luxury exports only.
The problem of the break up is that it does not solve anything, but just discloses the naked truth. So Le Pen and similar leaders have no solutions, they just want to be at the top of the new regions. They surely do not want to be in the bottom of the pyramid as the poorest ones. Autarky of nuclear energy dependent France, oil dependent Scotland or coal dependent Eastern Ukraine is a pure nonsense.
This anti-austerity thing is nothing new. If you look at most countries they are almost always running deficits… year after year … decade after decade… I think the US has had only 2 years with a balanced budget in the past 30 or so… France I believe is even worse….
It would appear that debt based — and now QE based — stimulus is the only way the economies can grow.
Of course that was always inevitable — a system that needs eternal growth was always going to run up against limits…
And that’s what has happened — the cancer that is capitalism (oh my banking friends in Hong Kong would love that phrase!!! — not) has metastasized and the host is gasping for air while the last rights are quickly read…
Of course the peaking of easy to access resources has driven an AIDS tainted stake into the host’s body compounding the problem.
All I am wondering is when the fat lady makes her appearance.
Here Is Why Europe Just Launched The “Nuclear Option” Against Russia
When will we run OUT?
Aussie Mining ran this piece from Reddit
The data assumes that we will extract to the last drop of oil or speck of ore… Of course as we know that is not going to happen — because the economy cannot grow if resource extraction costs are too high…
Most of the resources indicated on those graphs will never see the light of day.
Speaking of which MJ & Paul, here is a link: http://www.economic-undertow.com/
and although the article is interesting, scroll down to the graph. You may have seen it before but what it is illustrating is affordability. It shows that price for oil is narrowing into a tight range the overall economy, consumers, can afford that does not support costs of drilling that go higher than that price point. This is what we have recently been seeing as Capex requirements exceeds revenue.
So yes there is still lots of oil in the ground but much of it will remain there.
Thanks – excellent article
there’s maybe a trillion barrels’ worth of bitumen –heavy stuff, peanut butter– in veenzuela… dont know how much would be technically recoverable, but the chinese keep pecking away at it after big oil baled out
it’s called “orimulsion” once it’s diluted with water and sufactants so it will flow through pipes… apparently this orimulsion can be burned as is in power plants
anyhow, when you consider peak oil, venezuela’s bitumen, china’s presence in venezuela and chinese/russian interest in building a canal across nicaragua, it all starts making sense…
…which means that more atrocities in venezuela and nicarargua will make sense to the neocon empire
could be a fenit, i spose… china’s feint at gwadar pakistan was probably another reason the neocons needed a new pearl harbor… you know, to stop persian gulf and central asian asian energy from going the wrong direction
…the wrong direction being, towards colered people, wongs and slant eyes who have no business at all of using our oil and gas
…”our oil and gas” by virtue of our manifest racial superiority… sirta like “manifest destiny”
the weird thing about this venezuela/nicaragua/china lashup is that nobody seems to be making the connections… peak oil to vnezuela bitumen to chinese orimulsion to the nicaragua canal
but maybe it’s not so weird, after all… not when peak oil is dead, and so couldnt possibly be the reason chinese want a canal in nicaragua… and peak oil most certainly couldnt have been the reason the neocons needed a new pearl harbor
so i guess that’s to be expected –the failure to connect the dots, that is
i spose the neocons will miraculously concoct another new pearl harbor, this time blamed on china or russia or nicaragua or venezuela or any combination thereof
Next round of sanctions against Russia:
“The three oil companies– Gazpromneft, the oil-production and refining subsidiary of OAO Gazprom, oil transportation company Transneft, and oil giant Rosneft — will be forbidden from raising funds of longer than 30 days’ maturity.”
I see only 2 possible motives:
– introduce IOCs to russian oil/gas deposits and increase efficiency/output;
– increase price of oil and hence profitability of IOCs.
Apart from the above, it’s like self-tightening the noose.
I am interested in your opinions.
Lots of good comments, with valid points made by all. IMO, this is how it plays out:
– debt implosion wipes out all current asset pricing
– US fed.gov takes back currency authority – (re)issues ‘greenbacks’
– all available resources are directed at maintaining N America production via “new dollar” pricing regime
– national emergency declared, resulting in rationing, price controls, travel restrictions, etc
Once a baseline is established where everyone is getting a basic level of water/food, then the military/police patrols can be scaled back. At that point, no one is working except those commandeered by fed.gov; TV and the ‘net will keep the unemployed masses occupied.
The key industries will remain as today: military contractors, oi companies, ag biz, trucking/transportation. Keep these running, and there’s no reason for civil disobedience. Eventually, the truth may seep in that this is the new normal with a progressive slow decline to ever lower standards of living.
The scenarios I outlined above conform to the #1 prime directive, which is US fed.gov continuity of government. Remember, over 1000s of years, when the crisis arrives, kings kill the bankers. They then utilize traditional methods of uniting the body politic by (a) convalescing around a chose external/foreign enemy; (b) appealing to class unity via nationalism; (c) vilifying the 20% domestic population on either side in order to achieve 60% consensus.
This is just standard sh!t that anybody trained in governance knows since they were 13+ and slated (ie legacies) for their future graduating classes at Harvard/Yale/Oxbridge. Knowing how it plays out provides one with a sense of calm since you don’t have to get all worked up about the day-day theatrics.
Just focus on the really big picture, and make sure you fit in the 60% bracket to both avoid persecution and also get some goodies from the pantry (well, as long at that lasts).
That, B9K9 is not a bad summary of what seems to me to be a feasible way forward. Oil supplies will not just switch off and certainly not because letters of credit will go missing. The government will see to all that administrative stuff. But there needs to be a plan, probably worked out in secret to not spook the population still in la la land. Avoiding chaos will be difficult. Chaos is easy to create [look at Iraq] but hard to stop.
“Focus on the really big picture.” B9K9? Not big enough. Bigger still. Climate change will wreck all of their plans, IMHO. I’m sure the elite among the yeast cells in the vat of beer had a plan, as well.
Oh, there’s a plan all right: it’s to maintain control. Fed.gov has every law needed to justify any action, at any time, under any circumstance.
This mitigates the need for day-day details, other than make sure there’s basic food staples available. It’s also why the grid will be the last vestige of civilization to fail: it pumps fresh water in, pumps waste water out, and drives the devices to keep people entertained.
Ann, yes, the big picture as far as human constructs are concerned. Beyond that point, it’s difficult to get worked up about events that no one can control/stop. AWG, overpopulation, resource depletion, etc, etc were probably baked into the cake the day the first life forms began reproducing. That process launched all species on exponential growth curves that only nature can rectify ie cull, die-off, extinction.
Once you’re ok with that prospect, then you can enjoy your morning coffee in peace, and when the day is over, have a nice dinner, watch some TV (usually sports), have a beer and relax.
To reiterate discussions and earlier articles on this site — how do you keep pumping oil without a fully functioning global economy?
Oil extraction is massively high tech – it requires complex machinery — it requires computers — it requires spare parts — it requires chemicals …. it requires a functioning global supply chain.
A single part of that chain breaks — and that means oil supply ends — immediately.
We can’t even get oil out of the ground at a price that allows the global economy to grow as it is — high priced oil has destroyed growth and is collapsing the economy — pull away the trillions of stimulus and we collapse in a heap of rubble.
Oil production ends — civilization as we know it ends.
It has been suggested we can enslave people and force them to produce oil.
Utterly ridiculous – and out of touch with reality.
It is not like you can just put a gun to an engineer’s head in Texas and he will push a button and the oil comes out… this is not like building a pyramid where all you need are strong backs and stones quarries (and whips)… this a a complex operation that requires a fully functioning economy.
Our food supply is 100% dependent on oil and gas bases fertilizers and pesticides — without oil and gas — we starve. It really is as simple as that.
Of course nobody wants to think the worst — but unfortunately the facts do not support a scenario where the PTB are able to maintain any sort of control — that the PTB will feed you
Even if they could — they know there are billions too many on the planet — why wouldn’t they just let most people perish? Is it because they are benevolent good kinds who love the people?
Gimme a break….
Rather than speculation tinged with hopium and very little logic…. I prefer to go with well thought through research — and the best I have seen is Korowitz — I will post this again for those who have not seen it — the punchline starts on p.56 http://www.feasta.org/wp-content/uploads/2012/06/Trade-Off1.pdf
I would prefer Korowitz was wrong — but try as I might — I cannot find flaw to any of his logic.
Once you cut open the golf ball — and snip the elastic — it unravels quickly — and there is no putting it back together.
The PTB know that — that is why they are desperately trying to delay the start of the great unraveling.
Paul, you mention author of the Trade-Off in every third post, but you can’t remember his name – it’s Korowicz.
No t? I thought it was with a t….
B9K9, when the USD fails, a lot of things will fail. Hotels in Bali are quoted in USD. Aircraft parts, semiconductor equipment spare parts are quoted in USD. If the faith in USD is gone, Chinese manufacturer will not send their parts (especially bearings and connectors) to anywhere in the world. Credit would be frozen. JP Morgan will cease to exist and my bank in Malaysia will not be able to transfer my USD20,000 to my Chinese supplier of bearings as JP Morgan happens to be the intermediary bank for USD. My Chinese supplier wants the cash now (in 2 days) or else he will revoke my order. Furthermore, since USD is gone, they will reprice it in Yuan (which is also tied to USD) or EURO (which will also crash together with USD). My hypothetical factory makes the transport systems that is used in transporting the pipes at the oil rig (the heavy pipes that are used when they drill for oil). We have a large order for a company that drills in Bakken and we are to fulfill the order because they really need the transport system. However, my company is running lean (cost cutting due to deflation) and with “just in time” inventory, our company normally uses Purchase Order from the oil company to secure a loan from the bank. We will use the loan to purchase steel from Korea as they make high quality steel that will stand the harsh weather in N. Dakota. As our banks have problems with USD being worthless or changed to a new currency, we cannot get the loan needed within 3 days that we normally get. Our Korean supplier is also delaying our shipment as we cannot pay them. They also say that their ships have difficulty securing oil and their backup ship is under repair. The properly shaft was damaged but they too cannot secure a loan to buy the bronze.
Now, multiply the parts that are required in hypothetical “pipe transport system” (controller electronics, wires, cables, rubber tubings, bearings, steel, plastics, etc), that are made by many companies located in every part of the world. You will find that “no man is an island” is 200% true in this globalized world. Without the pipe transport system, how will your oil extraction system work in US. Now this “pipe transport system” is just one of the thousands of parts in extracting oil. If you include software (seismic analysis), supercomputers and skills (that may be scattered around the world), do you think you can work out a solution within 1 week. You don’t have more than 1 week to work out a plan if you want to ensure that the entire supply chain is working.
Please correct me if I am wrong but I think 99% of the people living in a modern civilization requires a bank. All our salary is now “digital”. When the employment income goes in, a large percentage disappears to pay down mortgages, car loans, etc. We are left only a small fraction of the money. We may take out a small out in cash at ATMs. So, if we were to have a bank holiday for 1 week and if VISA is not working, then I would say, that is also the end of “modern civilization” (in 1930s, bank holidays were not a problem as most of the people do not use bank).
Feel free to correct me or tell me a different scenario. Back it up with real experience and not just “talk”. My family has a large manufacturing facility here and I am working in a high tech industry. What I have said here is real and it happens all the time in Asia.
This has been talked about it here numerous times. It’s called semi/quasi autarchy and domestic gov/MIC supply chain. That’s why when Soviet empire fell apart, their specific sectors never recovered due to crippled supply chain beyond treshold, namely big ship building, while certain “most important” sectors like nuclear subs could and do go on, also with some imported knowhow they are able to produce impressive arctic drilling pods now etc. And some parts of old MIC even prospered like the space oriented industries with int cargo orbit (EU/US/..) clientele, as well as jets, radar system, missiles, some of it for export/licensing etc.
So, to assume these guys are not planning and executing for some autarchy in their most important export (energy) and general extractive industries as well is preposterous. Perhaps as lower priority long in the making as they thought energy – industry cooperation with Germany would be a smooth operation for ever despite anything, not so rosy now.
To stay with this example, there has been a few TV sneak peaks inside the top of the russian MIC, the clean laboratories/assembly lines are fully packed with imported stuff like german optics, CNCs, precision soldering, computers and software. That’s a huge problem for replacement and spare parts in case of embargo, aerial attack on such facility, but now most of this equipment likely is imported from allied China anyway.
In terms of credit cards/digital payment system some countires have it separately from US influence already, namely China and Japan, Russia is building its own now as well. More importantely there is a huge global wave of non usd denominated currency swaps for direct int payment with China, basically just a barter accounting layer.
All in aggregate and more doesn’t equal todays consumerist BAU for ever, but it means some limited gov survival and basic substinance for the people at least in decades to come. The reset/crash/transformation of the system is not the end of the world or immidiate global dieoff. We already discussed the likelyhood of debt clean out jubilees, you don’t have to rely on casino stock based pension fund anymore with caloric gov provided rationing etc. The virtual trillion”s of wealth” will be simply wiped out and in few years time no looking back. The people of “middle class” employed in production and service for “middle class” domesticaly and internationaly will be the most affected, simply gutted out, left idle some moved to gov work.
This time is different
When the USSR collapsed the rest of the global economy remained fully functional. So they could ‘plug in’ to a new system. They would sell their oil and gas and other resources – and participate economically.
When this collapse comes every country collapses – there will be nothing to plug into — no global economy — not even a functioning electric socket.
It is rather amusing to see how people are underestimating what we are facing.
We will revisiting a period somewhere between prehistoric man and feudal society — but without any of the skills that those people had.
This will be like putting a subsistence farmer from Game of Thrones into a Wall Street investment banking job and expecting him to survive.
As Gail has pointed out many times here — when the global economy busts — most of the resources that are in the ground – including oil — will remain in the ground.
Governments will quickly fall to pieces once their strategic oil reserves are depleted — they will not be able to enforce order once that happens. They most certainly will not be feeding you when the SHTF — because there is no way they are going to allocate fuel to meg farms to feed billions… they will most definitely use fuel reserves to enforce martial law for as long as possible — ensuring that the billions of mouths to feed – are dead.
Don’t underestimate the importance of a bearing. In WW2, bearing factories are always targeted in bombing raids. Any moving parts in the machine likely require a bearing. Even if it is just a simple rubber connector (hydraulic or pneumatic), it is just as critical as an electronic controller. Remember that the space shuttle exploded due to a faulty o-ring.
“Remember that the space shuttle exploded due to a faulty o-ring.”
In a globalized economy there are so many billions of different pieces — if any single one is no longer available for any period of time — the entire economy would blow to pieces just like the shuttle.
If you interrupt the global economy with say a debt jubilee as some are suggesting…. it’s not one part that stops — everything stops….
Europe Goes “All In”: Will Sanction Rosneft, Gazprom Neft And Transneft
Europe’s latest sanctions round will boldly go where Europe has never dared to go before, and impose sanctions on the big three: Rosneft, Gazprom Neft and Transneft.
It also means that suddenly the stakes for Russia, and thus Europe, just got all too real, as Putin will now have no choice but to really ramp up the retaliatory escalation, which following the food ban can only mean one thing: a staggered reduction in gas flow to Europe.
I haven’t confirmed this report, but if true it sure ups the ante.
Europe has no choice for if they don’t do this, they’ll be slaves to Russia forever.
Yep, exactly it’s all Putler’s fault, in fact Europeans after exhausting their stuff always wanted to rely only on the cheap LNG via ME tankers imported from their good friends there. The western-eastern europe-turkey-izrael-gulfies alliance is winning on the all fronts anyway, Syria, Iran, Libya, Iraq, Afghan, .. /sarc off
Slave to America — slave to Russia — what’s the difference?
At least with Russia you are assured of being able to keep the lights on and warm for at least one more winter.
Yes. Moreover, if you perform the deep analysis only two basic scenarios could be correct in the end. Either the increasingly sclerotic Europe, but still advanced market and industry is just the un-anchored prize in the winds for global powerstruggle between falling NA vs. ascendent Sinorussian Euroasia. Likely parallel to how the ancient world fought about rich clubmed kingdoms not to destroy them but to juice their wealth, yet keep their luxury trades/goods/knowledge flowing etc. Or is valid the second option, namely that for the past 250years the biggest honcho on the planet was uninteruptably focused in a small pocket of int bankers (BIS), e.g. hence the timings of switch from sterling to dollar standard, aborted “promising” dominance of Euro etc., all was just a mere vehicle/tool of overall control in changing world not “evidence” of that particular’s country/region real importance.
For me the jury is still out on this one. If the relevant powers of the EU bloc definately switches sides in say no more than 5-10yrs horizon to “the east” while NA goes into something like post Gorbatchev inner implosion and fragmentation, the latter option would be proven valid and vice versa.
All the Asians have to do is impose clothing sanctions on Europe, and all the poor will go naked. And put an embargo toothbrushes, and we all die of tooth abcesses (don’t you think CTG?)! Europe is so fantastically vulnerable now on every front.
“Europe is so fantastically vulnerable now on every front.”
Yes, Europe enforcing economic sanctions really seems like a dangerous game…
yep.. no one except the Chinese are making toothbrushes… anyone care to let me know where on earth are toothbrushes manufactured other than China or in Asia (Vietnam maybe?)?
Oral B; Iowa City, Iowa
anywhere else other than Iowa for toothbrush?
The government of Russia will have to issue credit to the oil sector to develop oil. Just as Lincoln issued greenbacks. No need to enslave industry to the global bankers. The “sanctions” say to the global bankers you may not increase your leeching off of the Russia oil industry. Great.
Never ever overestimate the “cleverness” of the elites or TPTB. I am definitely sure TPTB wants to live as long and as prosperous as they are now. So, if they are so “”smart”, then they would have started the transition to a “more renewable economy” 20 or 30 years ago.
So, when Europe wants to play “chicken” with Russian on NG/Oil, there will be tons or “unintended consequences” that will bring down the entire supply chain and banking sector completely. Even a “YES” for Scotland’s referendum will cause civilization to collapse. It will cause pound to drop, margin calls, pension funds starts to exit and threw in the towel. Liquidation of other assets to cover margin calls, trust disappears, credit evaporates and supply chain collapses. Unlike 2007, our global economy is so weak that no amount of QE will help. Any QE will just cause very high inflation. Interest already negative. “More negative” does not help at all. We have long past the “even horizon” and whatever we do, doing more will not help anymore..
If a Scottish yes vote is capable of bringing down the global economy — then it will not be allowed to happen. If there is a yes vote — and it is allowed to hold — then I will assume that the PTB do not think this is a threat to their position
How about Lehman Bros? Do you think they “underestimate” the situation? Do you think they sit down and think 10 steps ahead on what will happen especially on the unintended consequences? If they are capable of doing that, then we will not be in the “peak resources” situation. We would have our thorium reactors or fusion power already.
Here’s what I think happened with Lehman:
I believe that there was disagreement amongst the PTB about what to do in 2008 – some were likely saying we can’t bail this out — others were saying we must.
And Lehman was the test case — they decided to throw Lehman to the wolves and see what would happen.
And the pro bail out people said – see!!!! we told you so —- and they quickly threw the beast back in its cage and fed it trillions of printed dollars….
Look at Berlusconi – when he went against the ECB he was quickly thrown out of office and a dictator put in his place. The king of the mafia – billionaire — sent packing overnight.
And recall Papendreao – he wanted to call a referendum — again out the door – in comes an central bank appointed dictator.
The PTB will not let something as silly as a Scottish referendum upset the apple cart — if they think it will do that then we will do whatever is necessary to prevent this. If the yes vote goes through and they bust apart that surely means the PTB do not see this as a major problem. Otherwise they would stop it.
Of course that does not mean that the PTB are omnipotent — there are things that are beyond their control — things that they are unable to stop from going into motion — and unable to stop once they start to roll down the hill.
I do not see Scotland as being one of these.
Japan imploding – China imploding – the EU imploding — all certainties — and all things that once you reach a tipping point there is nothing that can be done… in the meantime as we can see the central banks are doing everything possible to hold them steady.
The Japanese PTB advise its citizens on an important item to stock up on when the SHTF…
Seems in times past when a disaster struck, folks ran out of wipes and substituted others, such as, newspaper, paper towels and yellow pages to keep clean. Thus, clogging up the plumbing and creating another disaster
A debt jubilee will not hurt the rich. They will still own the land, the houses, the apartments, the farms, the factories, the stores, the cell towers, etc… People who expected a pension will be hurt, private pension, public non-military pension, public pension military, and social security.
John Doyle, edpell, others
I agree that Debt Jubilee is the answer that the world might eventually turn to. Irregardless of what the PTB want, it would be the last gasp to keep the ball rolling along. This final “solution” will happen over night at the hands of the newly empowered demagogues who would arise after it becomes impossible for the current and future, gridlocked political system to function. New banks could be formed around a simpler system of finance based on hard assets, collateral, etc. Formalized bartering and black-marketeering replace the old debt-based system. New currencies might be implemented based on baskets of goods and commodities and the new elite will be anyone with hard assets. Temporarily (because this won’t last long), art, farmland, machinery, oil reserves, military equipment and ammunition, forests, metals, solar panels, small cohesive military units, long-shelf storage dry goods, could be the new units of measure for the new wealth.
Yep, that’s what I see to emerge soon after next leg down as “the last plateau” – if new deux et machina doesn’t materialize at that junction it’s then straight oneway into dark ages of at least few hundred years in duration, likely more. However, given the oppulence in coal and natgas (both relatively low tech) today in some regions this plateau could be made last easily into say 2045, not globally obviously but for relatively large pockets of “citadel civilizations” in Euroasia, NA and few other places. The nasty problem with this “last plateau” is that despite pretty radical onset of depopulation through factors (e.g. degrowth+demography+male infertility) you could still have a lot resources to waste (or invest) on wars effort. So, again it could be a bouncy plateau especially around some regional tectonic plates like energy routes, land bridges, trade hubs etc..
ps so perhaps Greer and Kunstler are going to be spot on for the 2040 onwards and that century beyond
Yes, 2040 sounds about right, but with a lot of horrible things happening in between to get us ready. These doomster blogs always keep pushing judgement day into the next decade, though. Its pretty safe for us to sit here 25 years from the predicted disaster and blog like we know what we’re talking about. You can go back into the archives of all of these various doomer sites and read that we’re all supposed to be dead by now. 1999, 2005, 2012, 2020, 2040 2050, 2060 sounds good.
I have come to take the view that we are already living in a disaster zone (if the economy and political structures are more or less holding up holding up, for most of us, well, the air, water and land are mostly poisoned are they not? ), which averts any stress and anxiety, -watching the signs and portents, – as to when IT is going to strike: IT already has, with varying impacts in different parts of the globe and levels of our societies…….
They WILL be hurt, but with title to a lot of land and other hard assets they will do better than most. Overseas property will be beyond their reach simply because our communication network will be much restricted. There will be all sorts of unintended consequences. We’ll have to live it to know.
In case people didn’t notice… the elites control the world through the use of debt … the IMF and World Bank are just two examples of institutions that drive countries into massive debt ensuring that they are debt slaves and controlled by the PTB.
Whether or not we agree on if a debt jubilee would help matters is moot — there is no way that the PTB – who are creditors to the tune of trillions of dollars — are going to let anyone off the hook.
The chances of that are about as high as Smithers sticking a 20 dollar bill into a beggars bowl.
This is how you get the PTB off that teat! And the world will see it happens, even if it’s massed pitchforks;
Personally, it will just implode and they will be stripped bare. Another type of person will take over.
A warlord most likely, if the government can’t rise to the occasion.
Maybe this is an option too;
The only way you get rid of the PTB is to collapse the global economy completely — that will happen soon enough — not because you want it — but because we are out of cheap oil.
Speaking of the economic system, let us consider the issue of planetary calefaction. There has been much talk, but little political action, regarding global warming. Why not? The answer is very, very simple: any serious shutdown or restraint of the polluting hydrocarbon industry complex will lead almost instantaneously to a collapse of the entire world economic system. And from there we regress to manual labor as practiced in bygone centuries. Plus complusive population reduction by the historically traditional methods. To say nothing of the inevitable resort to war in order to seize the remaining resources of life. Al Gore and the trendy, politically correct crowd seem eager to go this route. But for some reason, the vast majority of the world (including Congressional Democrats) appears hesitant to follow along. A few Lefties are hoping for the Emperor to impose a solution by force, since the masses cannot be persuaded any other way. Some on the Right think presently unforeseen high technology will save mankind. A catch-22? America, meet Mother Nature.
This is a great article about Elizabeth Warren’s view the market is broken. It shouldn’t just work for billionaires. A person working full time shouldn’t live in poverty. It trickles up, etc.
Thanks! I agree the market is broken. Unfortunately, we need more than a few law changes to really fix the situation. We really need cheap oil (cheap to extract oil, not just an oil price that is too low for producers) to make the country wealthy enough for the changes that Warren proposes really work, I am afraid. Admittedly some law changes might be helpful as well, but without cheap oil to go along, I don’t think they would be affordable.
True enough needing cheap oil, but fun anyway to watch someone with so much passion fight for the little people.
Unlike the French President, who has been shown – despite being a ‘socialist’ who stood on a ‘anti-business, anti-rich’ platform to get elected, – to mock the poor in France for not being able to afford dental treatment. ‘The Toothless’ he calls them. Any guillotines still in working order over there, he sounds like a good candidate for a test-run?
Dear Gail and All
For those who are interested in agriculture and current best practices and how a collapse of industrial civilization would impact current best practices, I recommend the DVD The Permaculture Orchard: Beyond Organic. It can be ordered from their website:
The DVD features Stefan Sobkowiak, whose 12 acre farm is in southern Quebec. Stefan began with a conventional organic farm, where lots of ‘organic’ chemicals were used instead of the synthetic chemicals used by conventional farmers. But you wouldn’t want to eat either the synthetic chemicals and the ‘organic’ chemicals used by most ‘organic’ farmers are just bandaids for a sick crop. The only spray that Stefan uses is a slurry of whey, a product of the dairy industry.
If he doesn’t spray, what does he do? He has ingenious methods of maximizing natural disease and pest control. For example, he never plants two identical apple trees next to each other. You will have to look at the DVD to understand all the clever things he has learned about growing fruit with a minimum of inputs.
Instead of describing everything he does, I want to focus on what would happen to him if industrial civilization collapsed in a heap on 1/1/15.
(1) His customers would not be able to drive vehicles to his farm and pay him Canadian dollars for his fruit. As things get desperate, his near neighbors would have to become his customers, and barter would rule.
(2) He would not be able to pump water to prevent late spring frosts and early autumn frosts. I doubt that he could get enough water pressure to drive the spray mechanisms. It is possible that, over time, he could rig a windmill to raise water into elevated storage. More likely, late and early frosts would take a significant toll on a fairly small fraction of his trees…because his blooming period extends over 2 months and only a few trees would be vulnerable at any single time.
(3) He would not be able to get gasoline to drive the riding lawn mower he uses to mow the grass in the lanes between his trees. If he has a scythe, I suppose he could theoretically cut the grass by hand. More likely he would have to cut the acreage under intensive management.
(4) His tools are mostly manual. But many of them are made out of metal or durable plastic. As they wear out, he would not be able to replace them. My guess is that he would do fine for about 10 years, and then begin to feel the pinch. In 30 years, most of his tools would not work.
Another area of focus is the rich heritage of agricultural knowledge which he is using. For example, his rootstock pear tree yields bad tasting fruit. But there are much better tasting varieties, which he grafts onto the desirable root stock from the nearly wild pear. The search for pears (and other fruits) which both please humans and are resistant to disease and insects is a thousands of years project, which is still ongoing. Listen to him explain why you will never have more than half the birdhouses occupied, and you will see some knowledge which developed as generations of farmers observed the birds and empathized with them and figured out why they behave the way they do.
Similarly, Stefan has developed certain techniques which make efficient use of human labor and industrial products. For example, he uses a heavy plastic mulch to keep grass from growing right up to the base of the trees and robbing the trees of nutrients. He has learned several tricks for using the plastic, and has developed some simple tools to assist in planting into the plastic. Likewise, he has developed some simple methods for trapping the two worst insect pests.
In short, if civilization crashes on 1/1/15, then Stefan will still be able to produce fruit. Perhaps not as much, but his production will not just stop. He is not dependent on a complex supply chain to produce fruit next year. But if the Stone Age really returns, then he will be increasingly limited by the lack of hand tools and plastic as the old ones wear out.
A local farmer has a rake which went west to the Dakotas in the 1870s and has now come back to North Carolina. This tool may be around for another hundred years. But Stefan’s precision hand tools for use in the orchard are not quite so robust.
My conclusion is that very few people would survive an instantaneous plunge into the New Stone Age. A handful of people in North America are growing food with relatively resilient methods and simple tools, but over the decades, they would become increasingly stressed. We can grow a lot of food with existing methods, provided we can keep certain elements of industrial society functioning. Just as a guess, I would say that keeping the right 20 percent of industrial society functioning would be sufficient to provide relative food security, IF we were rapidly transitioning to methods such as Stefan uses. However, our direction is the opposite…ever more brittle systems.
PS A review in Permaculture Activist found fault with only one practice. Stefan uses Honeylocust trees to fix nitrogen. The reviewer (Peter Bane) doesn’t think honeylocust is a good choice.
“My conclusion is that very few people would survive an instantaneous plunge into the New Stone Age.”
Soylent green- its whats for dinner. Plenty to eat, getting it cooked is the problem
Don’t those green squares come pre-cooked? My memory of that movie is the oceans die so seaweed is no longer available to convert into green squares, so they substitute with people. I suppose when using people they have to add greed dye.
I see the email address of the ICH newsletter didn’t come through on my post
However they have a website;
When reading those articles I find myself actually cheering on the collapse…. because collapse is better than the totalitarian nightmare that is being rolled out … also because I’d love to see their plans for us thwarted by a complete collapse of BAU which will drag these masters of the universe into the gutter with the rest of the species…
Paul, your thoughts here are contradicting your defence of debt lasting through the collapse, which you just posted. Defending debt is defending Bau, the 0.1%, and the pernicious influence.
I assume you REALLY want that totalitarian nightmare get its comeuppance. Then it has to be via debt jubilee. The USA is the ideal country to get the ball rolling although it will hold out as long as it can.
Debt will not survive collapse — debt will simply disappear — along with civilization…
Call that a debt jubilee if you like — but the PTB will not initiate such a thing — it will be forced on them ….
Initiating it simply leads to immediate collapse of the global economy…
And as we have seen they will do everything within their power to keep BAU going — and to do that they cannot wipe out debt and attempt to start over again…
Ultimately the problem is not debt — it is that we are out of easy to extract energy — wiping out debt would — even if it were feasible — would do nothing to address the disease — which is terminal.
On the theme of extraction of resources, Ugo Bardi has an excellent piece on gold mining on his blog, which underlines the total reliance on our old friend, oil, in every stage of the process, and illustrates the soaring costs of extraction.
“Ultimately the problem is not debt — it is that we are out of easy to extract energy — wiping out debt would — even if it were feasible — would do nothing to address the disease — which is terminal.”
Exactly Paul. Wiping the slate clean and getting a fresh debt start would not alter the ongoing net energy decline driving diminishing returns. Of course if a jubilee occurred a lot of people would temporarily be fooled into the excitement, the mirage of having solved the problem and party until it became apparent all was not good and the sad reality of their predicament reared its ugly head again.
Guys, please remember that when the bank collapses, the whole global economy collapses. We are already way too deep in to this mess. Banking is way too complex and they are controlling our lives directly and indirectly. There are so many people who survive depending on debts of other people (people selling cars, mortgages, machinery, insurance) and trade financing. When debt is written off, there will be plenty of people who will be out of job and it will have a cascading effect on the entire global economy. What will happen to the Treasury rates that so many other products are index to? What will the effects be? Nobody knows but likely it will not be good. Unlike in Biblical times, their economy is a simple economy and a regular debt jubilee works. It is very unlike to work in this global economy.
This is one Pandora Box that should not be opened
p.s. do you thin all the countries in the world will coordinate to have a debt jubilee?
Debt really is the “big cheese” No letters of credit, no shipping, therefore no international trade, no oil for those who rely on imports or food, the same. But it is only in line to happen because debt no longer can be made to work, so lets wipe it all. Basically it’s a last resort, but a necessary one. The USA will trigger it, being the reserve currency and every other country will just fall in.
Simply EVERYBODY lives on debt, so crashing it will upset EVERYBODY, including the ultra rich.
Forget about mortgages and torts and insurance and such. It’ll all be yesterday’s worries. Ones we very quickly will no longer care about. We’ll care about food. You know the saying “9 meals to disaster”. Cities have max 3 days food supplies and it’ll last 3 hours if panic sets in.
We have just got to make plans and set aside inventories for food stations etc.
We are just asking for Mother Nature to do her worst if we don’t.
Of course a debt jubilee cannot happen because the would immediately seize up the just in time supply chain. Good luck getting it started again… as the Feasta article indicates once this goes it is like Humpty – you cannot put it together again. Businesses need credit – the minute it stops it collapses — trying to coordinate getting it going again is impossible — far too many moving parts in far too many countries. Not possible
“We have just got to make plans and set aside inventories for food stations etc.” Why bother? So we have 3 days food as it stands — what point is there in governments stockpiling a few weeks or months? It just delays the inevitable.
Better the die off is swift
I guess I haven’t become a chicken little just waiting for the sky to fall in.
Or maybe you just can’t handle the reality of what we are facing and you are grasping for anything — however unrealistic — as a defense mechanism against despair.
If it were so simple as wiping out debt and starting over again — don’t you think that would have been tried by now?
Please explain to me how wiping out debt and starting with a clean slate solves a problem that is caused by the end of cheaply extractable oil?
Does that make oil magically bubble to the surface where it can be sucked up and pumped to the market – instead of using fracking?
Does it make the tar sands need a break even point of $12 instead of closer to $100?
Does it reverse the peak in conventional oil that happened in 2005?
This is not chicken little — this is reality. If you think wiping out debt will fix this problem then you have to explain how… in detail… you can’t just say ‘wipe out debt and punish those elites that run the world’
You seem to be so confident that you have the solution — the devil is in the detail….
You are being ridiculous now and you have zero idea of what my mood is. I am actually in a very good mood. Your mood seems seriously bleak, by comparison.
No I don’t at all think wiping out debt “would have been tried by now” You are contradicting your own previous comments saying that.
Where does this notion that oil will magically bubble to the surface relate to debt?
I don’t have to justify myself to you. I don’t pretend to have a solution, but I haven’t yet succumbed like you have to despair.
I will leave you with a single question:
How does wiping out debt solve or even mitigate a problem that is caused by the end of cheap oil?
You should know already. They both go together but either one can be the trigger. IMO debt will be the trigger and resource scarcity will keep it from recovering. It really depends just how close we go to critical resource scarcity before debt gets to a point of no return and that could be any day.
Yes debt can be the trigger to the collapse — e.g. Japan defaults on its sovereign debt… China – property developers default … etc etc etc…
And that is why I see collapse being a relatively fast process — say Japan defaults — that would be like the Lehman situation on steroids, coke, heroin, speed, HGH — with gasoline poured on top for good measure… everything unravels — essentially within seconds give all that is needed is a key stroke on a computer for the herd to hit the exits…
So think about that for a minute — Japan defaults — that sends cascading defaults throughout the planet — immediate chaos.
And what people are suggesting with a debt jubilee is essentially that everyone who is in debt defaults…. Japan, China property developers, corporations, people with mortgages, car loans, student loans, etc etc etc etc etc etc…
If a default by say Japan alone would result in chaos — what would a mass default look like? Commercial activity would stop — on a dime. And good luck trying to start that up again…. billions… no trillions of moving parts in the global economy …. all have to be restarted from scratch….
And you have not answered my question – yes the trigger will be debt defaults — the trigger will never be that we will drain the earth of oil to the last drop….
So how would having everyone and every entity on the planet fix the energy situation? I need you to explain why eliminating debt will make the extraction of oil suddenly more affordable?
Our entire economy is based on eternal debt — and you suggest all we need to do is rip that carpet out and that would fix what ails us…. that is like cutting out someone’s heart to try to cure terminal cancer – and expecting it to help the patient.
We have peaked on conventional oil — and other production will soon peak — how does eliminating debt change that?
The problem is that the low hanging fruit is gone — eliminating debt does not change that reality.
Eliminating debt will most definitely collapse the global economy into immediate chaos. It would shatter into a trillion pieces within hours — and all the kings men would be powerless to put it back together.
It borders on the absurd to believe that they could.
I have already made references in earlier posts to what a debt jubilee might do. There would have to still be governments and they need to have or to make up on the fly plans to manage this crisis. One does not have to restart from scratch. Why would you say that? it’s nonsense. Only you say that eliminating debt will make extraction of oil more affordable. Why do you believe that? I certainly don’t. Leaving the “Carpet” of debt under us , contrary to your assertion, IS the problem, not the answer. We will never drain all our oil “to the last drop” That’s not possible under any circumstances. Your whole blog here is nonsensical.
I don’t think wiping out debt will do anything to the extraction costs for oil. That is why I continue to ask the question – why do you think a debt jubilee is some sort of solution?
A solution to what? To there being too much debt?
Too much debt is not the real problem here — the end of easy and cheaply extracted oil is the problem.
There is NO solution to that (that I am aware of).
As for planning for the aftermath of a debt jubilee — essentially you are implying that a massive complex machine like a global market economy can be centrally planned — turned on and off overnight.
Not possible. There are far too many moving parts.
You wipe out debt and you wipe out BAU. The world as you know it ends.
Exactly. And we, in fact, need debt to extract fossil fuels, except possibly a little coal that can easily be extracted with very simple systems. Once debt was wiped out, if we did not have a way of ramping it up again, we would be pretty much assured that nearly all fossil fuels would need to stay in the ground forever. We would also be out of luck on building most dams, on building wind turbines, and extracting uranium, as well. Wiping out debt would likely bring about the same collapse that lack of fuels would create.
Hi Gail, You only need debt to extract fossil fuels NOW. Fossil fuel extraction will continue after the crash but won’t be paid for, just commanded by the military /government/etc. It will last until the machinery breaks down and cannot be repaired. Then all the difficult to extract oil and minerals will be unobtainable. Who knows if we will take advantage of that interlude to set up the way down to the resource poor future in store for survivors? I’m not filled with optimism on that one.
“It will last until the machinery breaks down and cannot be repaired.”
The supply chain of oil is very long and very complex — one part breaks – the whole thing breaks — one bearing goes — the entire operation shuts down.
So if you are right the whole thing will last a few days or weeks at most — there are literally millions of moving parts.
Let’s have a look at an oil refinery:
The only petroleum that will be available when the SHTF is petroleum that has already been refined and that is stored by the military. When that runs out — that will be the end of oil as a source of energy.
Shelling near Mariupol. Not a total ceasefire.
i believe that Putin is smarter than has been given credit here. He can ruin the west by allying with China and taking down the dollar hegemony. Easy peasy.
There’s a much bigger deal going on right now than just dealing with Putin;
Read therein; Nato Attacks!; The Covert Origins of ISIS, and others like Noam Chomsky in today’s edition. Might help clarify some thoughts. Plus older posts:
Arundhati Roy says much about corporate influence;
Here’s a video by John Pilger on the criminal IMF and World Bank:
Thanks – those are excellent articles
Thanks to you too for the listing of Trade -Off, which I has saved earlier, but I took the time to read all of it and agree with his idea that a financial collapse is the most Likely trigger of our collapse, because as he says it is the fastest operating keystone-hub.
However I question why he did not mention having a debt jubilee. Banks have almost no assets because of fractional reserve policies so can’t really control everybody’s mortgages and also in a deflating economy debt is an unmanageable burden and none of the principal can ever be paid back. So why continue to load our extravagant lifestyles, not to mention wars, onto future generations? It’s already going to be difficult enough considering the state of the planet they will be forced to endure, so reset and start again!
Debt jubilee ideas are “out there” principally mentioned in David Graeber’s conclusion to his book “Debt – The first 5000 years”. It is a last ditch option and so it should be seriously considered.
John, in a debt jubilee, trust (between banks and towards the central government) would evaporate and without trust, nothing works in the field of finance. Nobody would trust the banking system (the lender would just be bankrupt). How about the supplier who is owed money and the money he has owed to his supplier ?
That’s not a debt jubilee. All existing banks would be deleted at the stroke of a pen, just the same way they created the debt itself. If you have a mortgage you can celebrate its demise. If you have funds in the bank you can feel hard done by. Hopefully the rich will be the biggest losers [?].Forget trust, there’s little of that already and only a new regime can restart it. Besides we will be in the midst of a civilization ending catastrophe and the idea of carrying forward debt is just beyond ridiculous. There would be no money except what’s outside the banks now. No one would have a job. No pensions, no handouts. That’s what catastrophe means. Jobs in essential services, yes. Governments as set up now would be utterly unprepared but some semblance is likely to remain because the police and military will be needed. “New money” will pay them, or they will just have “privileges” like food. Debt that can be afforded compared to the $Quadrillion plus debt today will likely restart because whatever comes along will still have to be familiar to those who remain. I would say we would be on a war footing under military government, making use of coupons for specific purposes etc. for example. Someone will work something out as it happens. I’m just guessing, as probably we all are. There will be survivors, maybe millions.
There are several reasons why debt jubilee won’t work.
First is that it’s against the fundamental laws of state. Very many people, including the elite will not allow this to happen. Their wealth is based on this debt. Without it they are broke and going to work per pedes is not what they can accept.
Second thing is that it kills the currency and hence the trade. Both, domestic and international. Without trade the system falls apart in weeks.
The third thing is outside creditors – central banks, companies and private persons. It would trigger international havoc and potentially war. One country (especially US) cannot do it by itself. And I can’t imagine global debt jubilee at the same time. Too many contradictory interests.
Sorry, you really don’t get it. The whole point is to wipe out the existing corrupt ponzi system, which is driving us towards collapse. Why carry that baggage forward into collapse? You seem to imply that collapse will only be partial and that we will recover to BaU again and the elite will just carry on?
We are going broke anyway. The currency will be killed. Trade will be killed. It HAS to be. It is INEVITABLE. The 1% will be helpless as even without Debt jubilee.
Have you read Debt- The first 5000 years? Try it and reconsider.
You are far too optimistic about the collapse, contrary to just about all the comments on this blog.
You are forgetting why we are collapsing — the reason is due to the end of the easy to extract resources…
That trumps all else.
Wipe out the debt all you want — it does not get EROEI on oil back to a level where the global economy can function.
I think that is the same as what I am saying. Except not yet are we collapsing because the easy to reach resources are gone, Not yet , but soon enough. I did not say or assume wiping debt would get back the ERoEI. That idea was what you were implying in your earlier post on Debt.
Don, I really do get it. I read the book you mention some time ago. Quite interesting. What Graeber doesn’t seem to realize is that the whole civilization is built on the growth paradigm and the monetary system is indispensable part of it. All money is debt and without money we can only have barter system, which economically is very limiting. It is possible to use it only on local level, it simply can’t keep the system working on the country/state level.
I never said the collapse will be “partial and that we will recover to BaU again and the elite will just carry on”. On the contrary, the system will collapse in its own pace, but the elite will try to maintain BAU until it’s too late. This is what they do over and over throughout history. When you are a slave of one paradigm (like infinite growth) you can’t see some inevitable history turns and suddenly you have a war, revolution, femine and anarchy on the streets. You will have your debt jubilee with one adjustment – it will be out of control of the state. The state will not have the power or resources to keep the debt repayment process going.
I fully agree with what you write this time, which doesn’t differ from my earlier post in any substantial way. It just came across you thought that a jubilee was not going to happen, but when you write that the state will not have the power or resources to keep repaying debt, then the jubilee is the answer.
The collapse is always happening in certain sequence, as in Hemingway’s book:
“How did you go bankrupt?”
Two ways. Gradually, then suddenly.”
It will be the same this time. I believe we are in the “gradually” stage. I can’t imagine the moment, when TPTB realize that this is the time. It never happened in history, it won’t happen this time. And as Paul demonstrated it will not solve anything. The moment debt jubilee is implemented we should start the final countdown.
Many reasons why wiping debt out will not work — the biggest one would be that the people who control the world are the ones who are owed the money so they are not going to allow that. Two — because that means collapsing the entire economy and trying to start it up again — that is not something that is possible.
Will the US kick the chessboard if outplayed? I wouldn’t put it past them. Let’s hope there is some super Illuminati to reign them in.
rein them in
“Reign” them in works quite nicely, too.
Scotland is due to hold its independence referendum on 18th September. I’m surprised that relatively little has been made of North Sea oil. Most argument has centred around whether a rump UK would allow Scotland to use the pound sterling as its currency. However, an interesting tack from the pro-independence people has been to suggest that an independent Scotland need no longer be involved in Britain’s “illegal wars”. Current events are playing right into their hands, of course.
Opinion polls show independence winning around 47% of the vote, with the anti’s getting 53%. However, the pollsters say that the momentum is now with the pro-independence movement, with more previously undecided voters (of whom there are still plenty) opting for independence. Interesting times. Of course, not a decade goes by without the world map having to change in some way, large or small. South Sudan is the most recent new state but is already descending into civil war.
I wonder how Cameron would react if Putin were to throw his support behind the independence movement…. keeping in mind that NATO was behind the unseating of a democratically elected government in Ukraine….
I can’t see what leverage Putin would have there, other than the fact that Russians and Scots are fond of the hard stuff when it comes to alcohol. Politicians of all stripes enjoy playing their deadly games, it’s true.
My point was that the US did exactly that in Ukraine… and the US wonders why Russia is pissed…
Do you think Putin has reached the same conclusion as Adolf? The obvious dismay at the ceasefire wouldn’t allay his fears.
My observation of Putin is he is a master flip-flopper between aggression and passivity, as one or the other suits his needs. Sometimes pressing forward works to garner more real estate and FF sources, but when international reactions are pressing back too hard, he opts for passiveness (ceasefire).
i dont see why pvervbody is so worried about putin… assuming for the dubious sake of argument that all these neocon rabble rousers are genuinely worried…
first of all, it’s the neocons that have openly declared their intentions to establish global hegemony –“benevolent” hegemony, to boot– but the “benevolence” hasnt appeared yet
putin’s so-called aggression, so far, has been response to US/NATO aggression in chechnya, abkhazia and south ssetia… and now ukraine
the neocons’ gripe with putin is that he repossessed russian energy and media from russian neocons who were apparently scheduled to become part of the neocons’ empire –not to mention the fact that russian neocons were also scheduled to guarantee oil supplies to the empire as the empire tore up the middle east are remodeled it to israeli specification
and when you compare the aspiring neocon empire’s aggression to russian “aggression”, the neocons are way more aggressive than russia
here’s that map again…
and here’s a litttle song, “eagles and arrows”
If the West reinflames the Ukrainian situation it must become apparent to Putin that his options are rollover or war.
it the “west” inflames ukrainie, maybe the urors will come to their senses and junk NATO, build south stream, bypass ukraine and poland, and face the reality of russian gas
….unless the uros figure then need another big war to wreck their system so they can do some urban renewal and update their manufacturing base
if europe and russia are wrecked again, will ther be enough energy to rebuild?
or is there some unconscious suicidal impulse to wreck everything, given the fact hat the whole works was a horible mistake in the first place?
PCR says it is hubris verging on insanity driving the Empire. Events are definitely consistent. Putin is doing all he can to hold it together despite the provocations but he is not dealing with reasonable people which leaves force or capitulation as the ultimate options.
the only thing that makes sense to me, from a neocon standpoint, is that the people driving this operation are using it for cover for looting the dying empire
sure, there are racial supremacists and religious fanatics that believe in the project, but i dont see how any rational person could
it looks to me like we’re laying the groundwork here for the destruction of the abrahamic religions
that’s the bright side
the dark side… maybe things will get out of hand… like with that nuke primacy business, first strikes on russia and china
god help me, i’m getting bored iwht it… that arenhadt woman knew what she was talking about, “the banality of evil”
This seems to be what this is all about http://www.popularresistance.org/the-latest-in-the-new-cold-war/
The author, Mike Whitney, is often quoted in The Information Clearing House, but I’m not sure I believe him or not even though the ICH has a lot of credible articles
What I don’t understand is why Europe doesn’t simply convert to wind and solar energy — and leave Putin out in the cold (sarc)
Lol, good one.
I hear all the time the story of energy sources diversification here in Europe. At least from apparently not very smart persons. They mention US, Quatar (liquid gas), fracking and “renewables” as a potential sources. Well, we all know it won’t happen.
wadosy, seems like a lot of neocon paranoia to me, but also keep in mind every country including Russia and China have their own maps showing their influence and interests in acquiring. Look at China which claims the right to any oil in the South China seas. But if you look at a map their so called seas are right next to many other countries like Vietnam, the Philippines, etc. Russia did not get the Crimea (a great island to get due to the value of offshore oil/NG possible), and are nibbling away at the edges of the Ukraine. It’s no coincidence they immediately went after the Ukraine right after acquiring the Crimea. Suddenly they were concerned about Russian people living there? There’s much more to it than that. We are in a time period now in which major powers are willing to exercise force to attain resources. That is a huge sign of danger ahead, because oil is only going to get harder to find and more important to economies.
Edit to my last post: Russia did not get the Crimea (text) by sitting on their hands,
whohired the sniper to inflame the maidan situation?
who shot down the airliner? …was the airliner even shot down? …where’s the evidence? …why was the investigation so slipshod? …why did the western emedia immediately blame russia before the dust had settled? …does that tactic sound familiar?
the fact that the crimean people voted to join russia is irrelevant, isnt it? …seeing as how the neocons agitate for democracy, and free trade while restricting trade, and human rights by torturing people
the empire is too sleazy to make it without resorting to their bedrock moral belief, might makes right
putin knows that, and he’s hoping against hope that the europeans find enough balls to defky the neocon empire
the neocons stated their intent to establish global hegemony, and they also stated they needed a new pearl harbor to get their project started
they got into pwoer, then they got their new pearl harbor… and they’ve spent the last thirteen years proving they meant business
you cant blmae russians for not bkuying into this sleazy project, and you cant blame them for defending themsleves from neocon aggression, especially when neocon documents and actions have made their itnentions so clear
when you start thinking about the psychosexual aspects of the situation, it looks like we’ve got a hysterical neocon matriarchy attempting to defend its nest from reality
the girl in the hardware/beer store… tall, good looking, i think, but it’s getting hard to see faces
i tell her, “i dont think the matriarchy is gonna have any better luck than we did”
she has no idea what i’m tlaking about, and maybe i’m crazy, anyhow
it always surprised me, how glad people were to see me again
maybe i’d left them, maybe they got rid of me years earlier in bad circumstances
but then they were glad to see me
Russia didn’t ‘get’ the Crimea — the people there voted to split and side with Russia in a referendum… as to be expected since most of the people living there are actually ethnic Russian and speak Russian
“Russia didn’t ‘get’ the Crimea — the people there voted to split and side with Russia in a referendum… as to be expected since most of the people living there are actually ethnic Russian and speak Russian”.
And remember, Krim was given to Ukraina not long ago, maybee Ukraina should have given it back without it coming to this…
just a little reminder of how it works….
first, theneocons are convinced they’re already an empire, and are powerful enough to create their own reality
second, they sadi they needed a new pearl harbor –presumably part fo their “reality creation” project– in september 2000, just before they got powerful enough to make their new pearl harbor happened
third, then their new pearl harbor happened, which created the “reality” that we’ve been dealing with since
that new “reality” has spread like cancer throughout the imperial system, and provides the excuse for the aggression mapped out in the previous post
and the whole works is based on neocon belief in peak oil, and their belief that might makes right
the song comes from Aesop
An Eagle was soaring through the air when suddenly it heard the whizz of an Arrow, and felt itself wounded to death. Slowly it fluttered down to the earth, with its life-blood pouring out of it. Looking down upon the Arrow with which it had been pierced, it found that the shaft of the Arrow had been feathered with one of its own plumes.
“Alas!” it cried, as it died:
Moral of Aesops Fable: We often give our enemies the means for our own destruction.
Get this; WTI went down 1.16 to end the week at 93.29 & Brent dropped 1.01 to 100.82 !!!
Brent is close to going sub 100. I’m beginning to wonder if the oil traders know something stock market investors don’t. As price drops it puts more pressure on marginal oil profitability.
There is a war in Syria, actually the other side, domestic oposition already lost and have largely surrendered and disarmed, now are the government forces mopping up individual small pocket cells of imported jihadists from the dungeons and rubble of cities and villages. Russia, Iran and perhaps China are supplying the government in many ways. The images of widespread destruction are just unreal, it’s all on ytoube including the meatmincer stuff. The proxies of the west, saudis and some gulfies are now being pushed out for good, in some spots slowly still but steadily.
The people of Donbass region in the eastern UA (+int volunteers) destroyed most of the capacity of UA military in something like 4months, the fight was epic example of asymetric warfare in “hopeless uphill” situation of defending home land against leveraged agressor. It was achieved by heroism, cunning leadership including capture of most of the equipment from the otherside and/or legacy army depots and MIC factories on their land. Yep they evidently got spy drones data/+sat intel? form Russia, also they could swiftly offload hundreds of wounded soldiers to hospitals across border to Russia, but that’s mostly all the help they got. Now they are pushing for independent state, and the oligarchs of the past were parted with most of their claims of the ownership there by newly formed gov structures. A revenue which by the way made previosuly huge chunk of the budget in the western-central UA, now a collapsed state ripe for another revolution on the borders of the EU.
Economic sanctions against Russia, not that much of a success so far, long term deals on food and products have been put in place instead, again strenghtening ties with rest of the world, whe who is loosing money is the EU (and prestige), cracks on position and even threads of vetoing sanctions appearing from Slovakia, Czechs, Austria, Hungary, Germany, Italy, ..
Obviously, last tool is to push price of oil lower, ala 1980s but that’s not even short term viable plan today with the exploded capex across the board. I guess it’s all in concert, degrowth in the west, slowing growth in emerging world, and pssibly very temporary “gesture” punishment by gulfies and londoners to hammer down the exporting price for Russia, which is heading into PO induced very near term production shortfall in west siberian oil.
Now, from the angle of sequencing and timing, Russia planned and is executing ~70% army equipment overhaul during 2008-18 timeframe, that’s massive undertaking, which means enlarging the production of high tech arms from small production test run into the hundreds and thousands, it includeds new MIC factories also due to lost supply chain in UA etc. On another front, China’s internal economic memorandums call in practical step for parallel institutions for global trade and finance by cca 2020-5, some of the plans/insitutions were redrafted for earlier operational date, most likely due to worsening int situation.
In aggregate it seems to me the world is reshuffling into another equilibrium/mode, all major players are in frenetic dance with each other’s actions, although in the case of west it seems more like delirium trance. It’s evident next 5-10yrs will change our todays world profoundly and I’m not talking in good guy/bad guy categories.
I think that you could be right that the current drop in oil prices is an attempt by the powers that be to drive Russia into bankruptcy. Some one put up a link recently talking about how much control the PTB have in controlling world commodity prices. The question is, whether on of these moves might back fire on the west at some point.
Demand is dropping from around the world. I expect Chinese problems are part of what we are seeing. The world economy needs rising income and rising debt to keep the oil price up. Something is going wrong in this equation. My guess is that debt growth is lagging.
“Demand is dropping from around the world.” I agree Gail, although there are numerous MSM articles claiming that US fracking of oil has reduced price. I think they forget oil is used globally and what is garnered through fracking is not the tale of the tape regarding price.
“The world economy needs rising income and rising debt to keep the oil price up. Something is going wrong in this equation. My guess is that debt growth is lagging.”
But isn’t income also lagging, i.e. fairly stagnant against rising prices? That is something you have referred to at times. My assertion is; If people cannot afford high priced products produced and shipped using oil in different forms including fuel, then an oil price ceiling establishes, from which it can only go down over time as diminishing returns applies ever greater pressure on income.
Rockman, whom you remember from TOD, refers on peak oil to the recent price decline as occurring due to increased supply from recent investment in oil exploration. That dropping oil price is just part of a recurring cycle, and although the majors are behind on revenue now (due to recent exploration efforts) i.e. capex outpacing revenue, that in subsequent years they will recoup all their investment plus a huge profit. If this is just a recurring cycle he’s got a news scoop, because if on the other hand consumption is bumping up against an oil price affordability ceiling that is gradually descending, then we are in deep trouble because the unconventional/marginal sources will soon become unviable at a low enough price and we will become even more reliant on conventional sources that are in rapid decline.
If he is right, (which I doubt) then after these recent finds of oil are in sharp decline and supply reduces, which increases oil price, then the incentive for renewed exploration offers itself up again, and as he says the cycle renews itself. However, this scenario ignores limits to that cycle, which I think we are now seeing.
Agree. He is looking at past models — this time is different.
I agree with you that the big issue leading to dropping oil prices is affordability. Lagging wages are definitely part of the problem, and are leading to lagging growth in debt.
The reason why I mentioned lagging growth in debt is the fact that in some cases, the government is able to institute policies that allow debt to grow, even apart from higher wages. One example was mortgage loans given to people who didn’t have incomes, back in the early 2000s. Another is student loans being given to students who are unlikely to ever be able to pay back the loans. Another attempt recently is the ultra-low interest rates debt that is available for some purposes. The idea is that people and businesses who could not otherwise afford to borrow, will now be able to borrow, even without rising income. The new seven year loans on automobiles are another way of trying to ramp up debt apart from income.
I certainly remember Rockman. If, worldwide, new techniques were truly able to substantially lower the cost of oil extraction, then we could have lower oil prices. One of the things that Rockman doesn’t understand is that companies don’t have the ability to ramp up debt indefinitely. The “negative cash flow now, but big profits later” story only works if companies can keep borrowing and borrowing.
Another issue Rockman may be missing is that we need to keep the “whole system” operating. Suppose that the US companies getting oil from shale could continue drilling profitably at $70 barrel. If Middle Eastern, Russian, and Venezuelan oil producers are not able to collect enough taxes at $70 barrel, and because of this experienced huge internal unrest, this would be a problem, regardless of how well the producers getting oil from shale were doing. Also, Canadian Oil Sands contribute to world oil supply. If they found that they could not add any new production because of the low prices, this would be a problem as well.
You probably saw this article earlier: http://www.cbc.ca/news/business/oilsands-investments-at-risk-from-low-crude-prices-report-finds-1.2737879
Another point with respect to Rockman’s statement is “Low oil prices now, high oil prices later,” isn’t really possible. Once oil prices start to rise again, recession will hit world-wide (assuming recession hasn’t already hit from the falling oil production related to the earlier low prices). Thus prices will quickly fall again, just as they did in 2008.
A big paradox is while middle class educated people are able to understand and do know what is coming, they abhor so much physical work and lack of comfort that they prefer dying rather than living post collapse (and they will be served). In the other hand, low class people in the habit of hard work are not aware of the situation nor can they grasp it by themselves, but would surely prefer living post collapse (though they will not be allowed, because BAU needs them to be where they are now). In most of the world just a fraction of the lower class is used to physical work nowadays, and it seems that the opposition between physical and intellectual habits is going to increase the death toll.
Interesting observation. I sense that the ones most oblivious to our predicament as well as the most vociferous deniers that there is anything wrong with BAU is the upper middle class, whom work the least and have the most to lose, whose activities are also implicated as vastly unsustainable (think of the well manicured golf courses they live in, the huge houses). I saw a Tesla for the first time out in the wild. I was not at all surprised to see it turn into the driveway of a rather massive lakefront home. Teslas are the ultimate status symbol going right now, which ostensibly say “I’m rich and “green”!”
Maybe the whole reason I personally am aware is I see myself as having little to lose in any sort of collapse type scenario. I’m not sure if it would level the playing field, but I can only hope.
Funny you should say that about Tesla being the ultimate status symbol, because two different times I’ve witnessed guys acting like they were way above everyone else. The one I saw on hwy 5 driving south to L.A. was quick. That car can move!
New post up at Robert Scribbler:
Gail is mentioned in the comments. Your response, Gail?
Here’s the comment …
I scanned through that article and some of the comments… these people believe in the renewable energy god… and they want BAU to collapse…
They are in for one hell of a surprise…
This is the best overview of “real” peak oil (well fossil fuels) I’ve ever read.
The peak oilers have been right that the economy can’t expand for all because the economics are messed up due to EROEI and the like, but there is more than enough to destroy the whole climate and enable the few rich to expand consumption to continued unimaginable states while throwing enough down to general consumers that we can pitch in.
I’ve tried for years to convince people like Gail Tverberg to at least look at the “go all in” dynamics you mention, but it seems impossible because she just keeps repeating she hopes we stay on track as long as possible to delay complete civilization collapse until…what? Until she’s dead, I reckon. What about everyone else? In my darker moments, I feel like pointing out that anyone who advocates BAU simply because they fear change is feel free to off themselves the second they hate the new state too much to bear. Better to commit suicide than murder, in my view.
It’s almost like society as a whole recognizes that things can’t continue, but thinks that if we remain blind then we can live in reasonable comfort until we’re all whisked away in Rapture. Instead, we’ll obviously have continued social and mental breakdown while locking in climate chaos.
While a massive shift to renewables and better agriculture will create a more immediate short term economic dislocation (vs. destruction), at least people will realize what they’re working towards and find strength to get through it.
To me the question is, how do you break the cycle of fear? It’s certainly not achievable through rational means.
The commenter doesn’t really understand the predicament we are in, and how little we collectively can do to change the situation. Perhaps some individuals can better their own situation for a few years (or longer), but we can’t expect that that change will have any measurable impact on the total. I don’t see anything we can do about the climate change situation. It changes however it chooses, and we don’t have control over this. Collapse is baked into the cake, and will be one of the factors affecting climate. Of course, if most of us are not alive, it won’t make a huge difference to us.
I don’t think we collectively have a lot of control over the situation. We do not have a solution that will work, whatever we do. We have a self-organized system, and that self-organized system will “do its own thing,” to try to preserve expansion as long as possible. We are kidding ourselves, if we think we have a different option. We can write letters to the editor, or whatever we like, but it will not change the situation.
Thanks Gail it is so refreshing to read this simple truth.”We can write letters to the editor, or whatever we like, but it will not change the situation.”
Dear Gail and All
Here is a link to an interesting interview by James Howard Kunstler:
SanGiorgio is a Swiss citizen of Italian descent who lived for a number of years in the US. He now lives on a farm in Switzerland. His book on surviving the coming collapse was originally published in French and reached the top 50 books in France. He credits both Kunstler and Chris Martenson with starting him on his journey toward thinking about the issues we are likely to encounter as a society with many problems collapses. The book has now been published in English, with an introduction by Kunstler.
You will not find a great deal of detail in this interview. For example, the first item on his list is a secure water supply…but he does not go into detail about that in the interview. I assume that the book suggests some specific things that one might do to give themselves a secure water supply.
The author is quite candid that not everyone alive today will make it through the transition. He worked in Africa for some years, and reports that he has seen first hand the terrible toll that violence can take, and fears that our transition will involve a lot of violence. He thinks that Europe is rapidly descending into conflict between groups such as immigrants and those with many generations in a particular country such as Britain or France or Sweden. He states that current projections show 500 million immigrants to Europe over the next decades…which he thinks obviously won’t happen.
At about the 40 minute mark, in response to a question from Kunstler, he turns optimistic. The world we will live in 3 decades hence is likely to be a happier place. As he has changed his own life, he has rediscovered the joys of day to day tasks and human relationships. Even if collapse never happens, he does not regret doing what he has done. It’s simply a better way to live. A tomato or zucchini from one’s own garden tastes much better than anything one can buy. But we have to get through a difficult transition, with the potential for lots of violence. Kunstler closes with the opinion that we have passed the point of diminishing returns in terms of more stuff making us happier.
What’s next — tear gas and sniper rounds?
America is a kingdom of hypocrisy…
Pretty crazy huh? 7.25 an hour is a slave wage, and not for doing some easy work – those people work their tails off. It’s not even enough to break even. I’d like to force all the DC politicians that don’t want to raise the minimum wage and have them do that work and receive that pay for one year, and then ask them if they want to go vote to raise it.
Since we’re off to hell in a handbasket anyway — why not give these people a taste of the champagne and caviar instead of just the elites?
Triple the minimum wage — that might kick the can a few more months because these people will actually spend every cent of that raise…
Apparently that is not how humans are hardwired… if we are going down the elites will gorge like the disgusting pigs that they are — and everyone can eat pink slime as far as they are concerned.
And of course if anyone of these fast food workers someone were able to reverse fortunes and living large — they’d be gorging at the trough too — and be quite happy to let the less fortunate eat slime…
Are we humans not wonderful!
When there is little to loot from the world as BRICs are circling the wagons against the western natoids, few general approaches “remain viable” at this stage:
1/ Open full totalitarian control, this would likely need repatriation of some large chunk of outside stationed US troops for domestic riot police action (and possible blowback revolts), debt jubilees, expropriation of entire industrial sectors and services..
2/ Some form of advanced triage, i.e. eating itself domestically, you have to throw somebody under the bus to feed the beast a bit longer, that means channel the resources of the middle class for system-state duct taping purposes and placating the paupers with some basic stability mirage (rationing cards etc).
Clearly, we are somewhat on the level 2/ and sooner or later had to move on the upper 1/ level. This important switch could be about now (2014-2016) or in few years (2018 and later) or a decade a two into the future if the oily situation is on the brighter side.
That would be the inner clock apparatus how to meassure the speed of collapse anyway..
I thought about the government giving out ebt cards that expire quickly in order to increase demand and the velocity of money which has cratered.
Quite agree: I knew someone who used to talk with great about the virtues of ‘stepping lightly on the Earth’, etc, when they had no money; just as soon as they got the chance to join the party, they were bathing in champagne, figuratively speaking!
Well, remember the CFR is considering handling cash to everybody or so… However, this really sounds as being the last possible move
To make matters worse, most of those making $7.25 per hour are working part time jobs, so they get no benefits, like health insurance. Some work two or three part time jobs, to try to fill the gap. The proportion of part time jobs in the United States seems to have taken an upward jump in 2009.
I can’t see how this goes on for another year without some big rains … I think I read that half the fruit and veg in the US come from California…
Limits to Growth are about to be severely tested….
@Paul asks “What do the billions eat while we try to grow crops in the dead soil?”
Each other; it’s the only logical choice. Besides, it’s a three-fer:
– reduces competition for food, water & resources
– reduces (physical) existential threats
– provides food & nourishment
As we know, the global population needs to be reduced from 7.5b to somewhere around 500m in order to achieve some measure of sustainable balance. This ratio is in the range of 1 in 15, so to reduce it to more manageable terms, lets take a neighborhood with 75 people.
75 people all requiring food & water, and competing/threatening each other over who has what. If 70 can be effectively eliminated, then the remaining 5 have plenty of food (ie the other 70), plenty of water, and a great reduced threat of external violence. (Assuming each unit of 75 goes through the same process.)
Cannibalism may seem impossible from our comfortable perch, but I don’t see any other alternative, other than to lie down & die. Since at least 5 out of 75 will not share those feelings of abhorrence, those that can not “up their game” in the face of adversity will become one of the 70.
Humans are pretty large land animals. The principles of preserving meat, whether it be accomplished via salting, smoking, etc, have been around for millennia. Smoking pits may not have the finest hardwoods like hickory, but there will tons of douglas fir available that was used to build millions upon millions of McMansions.
When you realize the efficacy of this solution, you begin to realize that this must be part of long-term contingency plans. Again, it’s a simple solution, and one much preferable to blowing up the entire planet in a pique of frustration with nuclear toys.
Water shortages and disease are likely to kill off population fairly quickly. I don’t see cannibalism as really being an issue.
“As the seas rise, a slow-motion disaster gnaws at America’s shores”
Part 1: A Reuters analysis finds that flooding is increasing along much of the nation’s coastline, forcing many communities into costly, controversial struggles with a relentless foe.
I understand the Shadows of Liberty documentary has been pulled from that path …
You can find it here if interested http://www.youtube.com/watch?v=tEOywN773_c
(the intro is in chinese… just skip that)
Dear Gail and All
This will be a comment by an amateur about a subject he doesn’t know very much about. Nevertheless, the subject is, I think, particularly important for the kind of people who read this blog.
Kelly McGonigal has put out an audio CD titled Personal Transformation Based on Mindfulness and Self-Compassion. The CD’s contain six hours of content. Available from SoundsTrue.com. I recommend it.
Why? During the second session Kelly explains the default state of our mind. UNLESS we are focused on a very specific task, our mind wanders around thinking rather chaotically about the unsatisfactory nature of whatever is actually happening, remembering past history and fantasizing about future events, about reconstructing what we mean by ‘me’, and ruminating about how we relate to other people…frequently in an unfriendly way. This ‘default state of the mind’ is a prescription for pain and suffering, although it obviously has some survival value.
People who are depressed find it very difficult to break free of this mind trap. And record numbers of Americans and other nationalities are currently either clinically depressed or at least not mentally healthy. I believe that the UN now considers depression to be the most common chronic disease.
If you think about social media, it seems to me that they are thriving by taking advantage of the chaotic state of most people’s ‘default mind’. For example, following other people and constantly comparing them to me.
Particularly relevant to those who read this blog is perhaps the notion that if you aren’t worried about the future, then you just don’t understand the situation. But continually ruminating on the uncertainties in the future is not an excuse for failing to focus on what needs to be done today. Just this evening I picked up John Jeavons Grow More Vegetables book, and noted that it was originally published in 1972…34 years of waiting for collapse.
The answer, it seems to me, is to calmly consider the facts and the possible future events, and THEN to formulate specific action items and spend one’s time focused on those action items. STOP ruminating about what might go wrong.
Kelly makes the point that, in order to get the particular default brain activity I have described, the scientist asks the subject to imagine how things might be. The result is the noisy chatter of an unfocused brain.
If you perceive that I might have pointed to an important problem, then you need Kelly’s unique blend of neuroscience and the wisdom traditions.
Don, interesting post.
the chaotic default state of mind is quite normal, as we are exceptionally creative beings. Our mind is constantly at work in a two-ways relationships with our emotions, that is thoughts create emotions and emotions create thoughts.
The thought of collapse creates the emotion of worry, that emotion creates thoughts of possible scenarios, which feeds more fear and despair leading to paranoia, depression and sense of powerlessness, basically the doomer’s delirium.
I would like to point to you the work of Ouspensky, which drew inspiration from the work of Gurdjieff. Ouspensky spent a lot of years researching this particular over activity of the mind and investigating religions, mysticism, yoga etc… He then wrote the 4th Way, as teachings and practices in training ourselves in “observing” this over activity of the mind. He’s main point is that if we learn to control the mind and silencing it when spinning out of control we would reach greater understanding of our life and more control of ourselves and our emotions.
It is indeed quite interesting during the day to stop and notice what our mind is elaborating, what it is mumbling about. This will help put into perspective the collapse and drive sensible actions calmly, without freaking out.
As recommended by the Afghan philospher Idries Shah: we can implement self-observation , without excessive self-reproach or introspection, in order to learn and develop. ‘I thought/said/did this – but what other approaches might I have taken?’
Fanatics and the depressed can often only see one thing, one route, one outcome…..
xabier I agree with you about fanatics, I personally think it is the mental handicap to see things only one way. A monovision that rejects other possibilities other then its own certainty.
Yet the richness of humanity is pervaded with stark warnings about the tricks that our minds plays on us in the face of future perspectives.
Epictetus used to say: “People are not disturbed by things, but by the view they take of them.”
And here is Marcus Aurelius, my favourite Roman emperor: “If you are distressed by anything external, the pain is not due to the thing itself, but to your estimate of it; and this you have the power to revoke at any moment.” and also “Our life is what our thoughts make it.”
Publilius Syrus was already aware of conspiracy theories: “He, who is filled with fear, sees dangers everywhere”.
Also Seneca left us good words: “we suffer more from imagination than from reality.”
I did not know of Idries Shah and I thank you for tipping him to me, I always welcome new wisdom (No man was ever wise by chance 🙂
There was a great fashion for Marcus Aurelius just before WW1, lots of beautifully printed and bound editions can still be bought; I wonder if more reflective people then were reacting to the tense international situation? Also Epictetus.
I particularly warm to the Emperor when he says that some days life seems so awful he just wants to lie in bed and pull the blanket over his head!
We face nothing that the Ancients didn’t have to deal with, in essence.
Idries Shah has a huge bibliography, and devoted much of his life to publishing modern versions of the wisdom literature of Persia, Afghanistan, Turkey, etc. ‘Magic Monastery’ and ‘Wisdom of the Idiots’ are particularly entertaining books and an introduction to his ‘Action Philosophy’. He greatly influenced the Nobel Laureate Doris Lessing.
Bill Clinton’s favorite book, after the Bible, is The Meditations of Marcus Aurelius.
I think you and me are in total tune with regard of philosophy. I wish we could discuss about it on a warm summer evening in the countryside with a bottle of good red wine
Thanks for the tips regarding Idries Shah’s books.
I couldn’t agree more – with a couple of additional points.
1. Try and get heritage varieties of fruit, nut and vegetables. In other words, use plants whose seeds will be able to keep producing viable offspring generation after generation.
If you think that the large seed etc companies have made a point of putting long term viable varieties on the market, you are welcome to your belief.
It won’t be much fun painstakingly nurturing seeds you have collected and discovering that they simply won’t produce crop-producing plants – especially when the survival of you and yours depend on them.
2. When things get ugly, the most dangerous species on the planet is going to thank you for providing them with food. If you are lucky, their thanks will consist of letting you live so that you can grow some more for them. If not, you can feel good that the marauders shortening your lifespan may enable your remains to be used as fertiliser for whatever grows on your unmarked grave.
I suggest that you don’t advertise your success in gardening etc; make it unobvious, and, much more important, be part of a really strong community that is prepared to defend its “lifeboat” against predators – especially two legged ones.
Finally, thank you for your ongoing contributions – I always find them very worthwhile reading.
Dear Simple Simon
Thank you for your kind remarks.
And I agree with everything you say.
Dear Gail and All
See Rob Hopkins article today on sustainable food and WalMart:
I have said all this before, but perhaps I can get it into a more coherent statement, prompted by what I see as the fallacies in Rob’s article.
Sustainable perishable vegetables require one of two approaches to work. In the industrial model, they require sustainable production in some distant place like California, harvesting and immediately cooling to just above freezing, packaging sustainably, transport in refrigerated trucks to supermarkets around the globe, display in refrigerated bins in the supermarkets, sustainable local transport by the consumers to and from the supermarkets which are not within walking distance for most people, storage in a sustainable refrigerator, and then use by the consumer with sustainable cooking.
In the gardening model, they require that the gardener have access to some land within walking distance, the knowledge required to sustainably garden, and sustainable cooking.
It may be foolhardy to bet against WalMart, but I do not think they can put together a supply chain which is actually sustainable. Therefore, the only solution is gardening…along with some work on solar cooking and raw foods and, if things are really tough, perhaps evolving back into standard primates who do not cook. At any rate, it seems to me that gardening is much more likely to be the answer for most people than any ‘green’ solution implemented by WalMart.
As I have said before, I think that for quite a while into the future, commodities such as dried grains and beans are likely to be available and will need an efficient, if not sustainable, distribution system. What we might see is something like the Cuban system: everyone gets a ration of dried grains and beans, but they are on their own for fresh veggies and fruits.
I doubt that some of the more ‘scenic’ local food initiatives would survive tough times. ‘Local Food Night’ at chef dominated restaurants is a lot of fun, but if we experience collapse, they won’t survive. Farmer’s Markets where pickup trucks drive long distances to market won’t survive tough times.
I do not claim that people living in high rises in huge cities can feed themselves off their balconies.
Rob’s central fallacy, I think, is to rely excessively on the notion that a local market can flourish when things get tough. Tough times tend to weed out inefficiencies…which may include some of the businesses near and dear to the hearts of the localization movement. But gardening, which is the ultimate in localization, will probably survive. But really tough times will work against any garden that you have to drive to. For example, the last I heard Carol Deppe was driving to her garden. I see that as in invitation to theft, besides the issues around car availability.
In short, grow as many fresh fruits and vegetables in your own close neighborhood as you can. Use best practices to recycle water and nutrients rapidly to maximize production. Use good garden architecture to maximize solar harvest. Knowledge will be worth a lot, as will an established infrastructure.
This should put an end to discussions of renewable energy as the miracle cure:
The role that fossil fuels play in the creation, maintenance and support of alternative energy technologies is not discussed or analyzed at all by those peddling it to the masses who live with the hope of a “green” economy and carbon-neutral civilization. From the massive mining operations and manufacturing processes necessary to extract the rare earth metals essential in constructing wind turbines, solar panels, and electric car batteries to their daily maintenance, de-activation, and final discardment, the amount of fossil fuel energy embedded in the entire life cycle of such alternative energy technologies renders moot their benefits when compared to what is actually more effective in solving our energy and climate conundrum —reducing our consumption through energy efficiency improvements and waste reduction programs. Alternative energy technologies cannot replace our dependence on fossil fuels and are, in the final analysis, diverting us from coming to grips with a way-of-life that cannot go on for much longer. We have a consumption crisis.
“Common knowledge presumes that we have a choice between fossil fuels and green energy, but alternative energy technologies rely on fossil fuels through every stage of their life cycle. Most importantly, alternative energy financing relies ultimately on the kind of economic growth that fossil fuels provide. Alternative energy technologies rely on fossil fuels for raw material extraction, for fabrication, for installation and maintenance, for back-up, as well as decommissioning and disposal. And at this point, there’s even a larger question: where will we get the energy to build the next generation of wind power and solar cells? Wind is renewable, but turbines are not. Alternative energy technologies rely on fossil fuels and are, in essence, a product of fossil fuels. They thrive within economic systems that are themselves reliant on fossil fuels.
This post quotes Ozzie Zehner. Ozzie Zehner is the author of the book Green Illusions. He also reads Our Finite World.