Why political correctness fails – Why what we know ‘for sure’ is wrong (Ex Religion)

Most of us are familiar with the Politically Correct (PC) World View. William Deresiewicz describes the view, which he calls the “religion of success,” as follows:

There is a right way to think and a right way to talk, and also a right set of things to think and talk about. Secularism is taken for granted. Environmentalism is a sacred cause. Issues of identity—principally the holy trinity of race, gender, and sexuality—occupy the center of concern.

There are other beliefs that go with this religion of success:

  • Wind and solar will save us.
  • Electric cars will make transportation possible indefinitely.
  • Our world leaders are all powerful.
  • Science has all of the answers.

To me, this story is pretty much equivalent to the article, “Earth Is Flat and Infinite, According to Paid Experts,” by Chris Hume in Funny Times. While the story is popular, it is just plain silly.

In this post, I explain why many popular understandings are just plain wrong. I cover several controversial topics, including environmentalism, peer-reviewed literature, and climate change models. This post pretty much excludes religion. It was added for people who find it hard to believe that a scientific article could also touch upon religion. If you want the complete discussion, as the post was originally written, please see this post

Myth 1: If there is a problem with the lack of any resource, including oil, it will manifest itself with high prices.

As we reach limits of oil or any finite resource, the problem we encounter is an allocation problem. 

What happens if economy stops growing

Figure 1. Two views of future economic growth. Created by author.

As long as the quantity of resources we can extract from the ground keeps rising faster than population, there is no problem with limits. The tiny wedge that each person might get from these growing resources represents more of that resource, on average. Citizens can reasonably expect that future pension promises will be paid from the growing resources. They can also expect that, in the future, the shares of stock and the bonds that they own can be redeemed for actual goods and services.

If the quantity of resources starts to shrink, the problem we have is almost a “musical chairs” type of problem.

Figure 2. Circle of chairs arranged for game of musical chairs. Source

In each round of a musical chairs game, one chair is removed from the circle. The players in the game must walk around the outside of the circle. When the music stops, all of the players scramble for the remaining chairs. Someone gets left out.

The players in today’s economic system include

  • High paid (or elite) workers
  • Low paid (or non-elite) workers
  • Businesses
  • Governments
  • Owners of assets (such as stocks, bonds, land, buildings) who want to sell them and exchange them for today’s goods and services

If there is a shortage of a resource, the standard belief is that prices will rise and either more of the resource will be found, or substitution will take place. Substitution only works in some cases: it is hard to think of a substitute for fresh water. It is often possible to substitute one energy product for another. Overall, however, there is no substitute for energy. If we want to heat a substance to produce a chemical reaction, we need energy. If we want to move an object from place to place, we need energy. If we want to desalinate water to produce more fresh water, this also takes energy.

The world economy is a self-organized networked system. The networked system includes businesses, governments, and workers, plus many types of energy, including human energy. Workers play a double role because they are also consumers. The way goods and services are allocated is determined by “market forces.” In fact, the way these market forces act is determined by the laws of physics. These market forces determine which of the players will get squeezed out if there is not enough to go around.

Non-elite workers play a pivotal role in this system because their number is so large. These people are the chief customers for goods, such as homes, food, clothing, and transportation services. They also play a major role in paying taxes, and in receiving government services.

History says that if there are not enough resources to go around, we can expect increasing wage and wealth disparity. This happens because increased use of technology and more specialization are workarounds for many kinds of problems. As an economy increasingly relies on technology, the owners and managers of the technology start receiving higher wages, leaving less for the workers without special skills. The owners and managers also tend to receive income from other sources, such as interest, dividends, capital gains, and rents.

When there are not enough resources to go around, the temptation is to use technology to replace workers, because this reduces costs. Of course, a robot does not need to buy food or a car. Such an approach tends to push commodity prices down, rather than up. This happens because fewer workers are employed; in total they can afford fewer goods. A similar downward push on commodity prices occurs if wages of non-elite workers stagnate or fall.

If wages of non-elite workers are lower, governments find themselves in increasing difficulty because they cannot collect enough taxes for all of the services that they are asked to provide. History shows that governments often collapse in such situations. Major defaults on debt are another likely outcome (Figure 3). Pension holders are another category of recipients who are likely to be “left out” when the game of musical chairs stops.

Figure 3 – Created by Author.

The laws of physics strongly suggest that if we are reaching limits of this type, the economy will collapse. We know that this happened to many early economies. More recently, we have witnessed partial collapses, such as the Depression of the 1930s. The Depression occurred when the price of food dropped because mechanization eliminated a significant share of human hand-labor. While this change reduced the price of food, it also had an adverse impact on the buying-power of those whose jobs were eliminated.

The collapse of the Soviet Union is another example of a partial collapse. This collapse occurred as a follow-on to the low oil prices of the 1980s. The Soviet Union was an oil exporter that was affected by low oil prices. It could continue to produce for a while, but eventually (1991) financial problems caught up with it, and the central government collapsed.

Figure 4. Oil consumption, production, and inflation-adjusted price, all from BP Statistical Review of World Energy, 2015.

Low prices are often a sign of lack of affordability. Today’s oil, coal, and natural gas prices tend to be too low for today’s producers. Low energy prices are deceptive because their initial impact on the economy seems to be favorable. The catch is that after a time, the shortfall in funds for reinvestment catches up, and production collapses. The resulting collapse of the economy may look like a financial collapse or a governmental collapse.

Oil prices have been low since late 2014. We do not know how long low prices can continue before collapse. The length of time since oil prices have collapsed is now three years; we should be concerned.

Myth 2. (Related to Myth 1) If we wait long enough, renewables will become affordable.

The fact that wage disparity grows as we approach limits means that prices can’t be expected to rise as we approach limits. Instead, prices tend to fall as an increasing number of would-be buyers are frozen out of the market. If in fact energy prices could rise much higher, there would be huge amounts of oil, coal and gas that could be extracted.

Figure 5. IEA Figure 1.4 from its World Energy Outlook 2015, showing how much oil can be produced at various price levels, according to IEA models.

There seems to be a maximum affordable price for any commodity. This maximum affordable price depends to a significant extent on the wages of non-elite workers. If the wages of non-elite workers fall (for example, because of mechanization or globalization), the maximum affordable price may even fall.

Myth 3. (Related to Myths 1 and 2) A glut of oil indicates that oil limits are far away. 

A glut of oil means that too many people around the world are being “frozen out” of buying goods and services that depend on oil, because of low wages or a lack of job. It is a physics problem, related to ice being formed when the temperature is too cold. We know that this kind of thing regularly happens in collapses and partial collapses. During the Depression of the 1930s, food was being destroyed for lack of buyers. It is not an indication that limits are far away; it is an indication that limits are close at hand. The system can no longer balance itself correctly.

Myth 4: Wind and solar can save us.

The amount of energy (other than direct food intake) that humans require is vastly higher than most people suppose. Other animals and plants can live on the food that they eat or the energy that they produce using sunlight and water. Humans deviated from this simple pattern long ago–over 1 million years ago.

Unfortunately, our bodies are now adapted to the use of supplemental energy in addition to food. The use of fire allowed humans to develop differently than other primates. Using fire to cook some of our food helped in many ways. It freed up time that would otherwise be spent chewing, providing time that could be used for tool making and other crafts. It allowed teeth, jaws and digestive systems to be smaller. The reduced energy needed for maintaining the digestive system allowed the brain to become bigger. It allowed humans to live in parts of the world where they are not physically adapted to living.

In fact, back at the time of hunter-gatherers, humans already seemed to need three times as much energy total as a correspondingly sized primate, if we count burned biomass in addition to direct food energy.

Figure 6 – Created by author.

“Watts per Capita” is a measure of the rate at which energy is consumed. Even back in hunter-gatherer days, humans behaved differently than similar-sized primates would be expected to behave. Without considering supplemental energy, an animal-like human is like an always-on 100-watt bulb. With the use of supplemental energy from burned biomass and other sources, even in hunter-gatherer times, the energy used was equivalent to that of an always-on 300-watt bulb.

How does the amount of energy produced by today’s wind turbines and solar panels compare to the energy used by hunter-gatherers? Let’s compare today’s wind and solar output to the 200 watts of supplemental energy needed to maintain our human existence back in hunter-gatherer times (difference between 300 watts per capita and 100 watts per capita). This assumes that if we were to go back to hunting and gathering, we could somehow collect food for everyone, to cover the first 100 watts per capita. All we would need to do is provide enough supplemental energy for cooking, heating, and other very basic needs, so we would not have to deforest the land.

Conveniently, BP gives the production of wind and solar in “terawatt hours.” If we take today’s world population of 7.5 billion, and multiply it by 24 hours a day, 365.25 days per year, and 200 watts, we come to needed energy of 13,149 terawatt hours per year. In 2016, the output of wind was 959.5 terawatt hours; the output of solar was 333.1 terawatt hours, or a total of 1,293 terawatt hours. Comparing the actual provided energy (1,293 tWh) to the required energy of 13,149 tWh, today’s wind and solar would provide only 9.8% of the supplemental energy needed to maintain a hunter-gatherer level of existence for today’s population. 

Of course, this is without considering how we would continue to create wind and solar electricity as hunter-gatherers, and how we would distribute such electricity. Needless to say, we would be nowhere near reproducing an agricultural level of existence for any large number of people, using only wind and solar. Even adding water power, the amount comes to only 40.4% of the added energy required for existence as hunter gatherers for today’s population.

Many people believe that wind and solar are ramping up rapidly. Starting from a base of zero, the annual percentage increases do appear to be large. But relative to the end point required to maintain any reasonable level of population, we are very far away. A recent lecture by Energy Professor Vaclav Smil is titled, “The Energy Revolution? More Like a Crawl.”

Myth 5. Evaluation methods such as “Energy Returned on Energy Invested” (EROI) and “Life Cycle Analyses (LCA)” indicate that wind and solar should be acceptable solutions. 

These approaches are concerned about how the energy used in creating a given device compares to the output of the device. The problem with these analyses is that, while we can measure “energy out” fairly well, we have a hard time determining total “energy in.” A large share of energy use comes from indirect sources, such as roads that are shared by many different users.

A particular problem occurs with intermittent resources, such as wind and solar. The EROI analyses available for wind and solar are based on analyses of these devices as stand-alone units (perhaps powering a desalination plant, on an intermittent basis). On this basis, they appear to be reasonably good choices as transition devices away from fossil fuels.

EROI analyses don’t handle the situation well when there is a need to add expensive infrastructure to compensate for the intermittency of wind and solar. This situation tends to happen when electricity is added to the grid in more than small quantities. One workaround for intermittency is adding batteries; another is overbuilding the intermittent devices, and using only the portion of intermittent electricity that comes at the time of day and time of year when it is needed. Another approach involves paying fossil fuel providers for maintaining extra capacity (needed both for rapid ramping and for the times of year when intermittent resources are inadequate).

Any of these workarounds is expensive and becomes more expensive, the larger the percentage of intermittent electricity that is added. Euan Mearns recently estimated that for a particular offshore wind farm, the cost would be six times as high, if battery backup sufficient to even out wind fluctuations in a single month were added. If the goal were to even out longer term fluctuations, the cost would no doubt be higher. It is difficult to model what workarounds would be needed for a truly 100% renewable system. The cost would no doubt be astronomical.

When an analysis such as EROI is prepared, there is a tendency to leave out any cost that varies with the application, because such a cost is difficult to estimate. My background is in actuarial work. In such a setting, the emphasis is always on completeness because after the fact, it will become very clear if the analyst left out any important insurance-related cost. In EROI and similar analyses, there is much less of a tieback to the real world, so an omission may never be noticed. In theory, EROIs are for multiple purposes, including ones where intermittency is not a problem. The EROI modeler is not expected to consider all cases.

Another way of viewing the issue is as a “quality” issue. EROI theory generally treats all types of energy as equivalent (including coal, oil, natural gas, intermittent electricity, and grid-quality electricity). From this perspective, there is no need to correct for differences in types of energy output. Thus, it makes perfect sense to publish EROI and LCA analyses that seem to indicate that wind and solar are great solutions, without any explanation regarding the likely high real-world cost associated with using them on the electric grid.

Myth 6. Peer reviewed articles give correct findings.

The real story is that peer reviewed articles need to be reviewed carefully by those who use them. There is a very significant chance that errors may have crept in. This can happen because of misinterpretation of prior peer reviewed articles, or because prior peer reviewed articles were based on “thinking of the day,” which was not quite correct, given what has been learned since the article was written. Or, as indicated by the example in Myth 5, the results of peer reviewed articles may be confusing to those who read them, in part because they are not written for any particular audience.

The way university research is divided up, researchers usually have a high level of specialized knowledge about one particular subject area. The real world situation with the world economy, as I mentioned in my discussion of Myth 1, is that the economy is a self-organized networked system. Everything affects everything else. The researcher, with his narrow background, doesn’t understand these interconnections. For example, energy researchers don’t generally understand economic feedback loops, so they tend to leave them out. Peer reviewers, who are looking for errors within the paper itself, are likely to miss important feedback loops as well.

To make matters worse, the publication process tends to favor results that suggest that there is no energy problem ahead. This bias can come through the peer review process. One author explained to me that he left out a certain point from a paper because he expected that some of his peer reviewers would come from the Green Community; he didn’t want to say anything that might offend such a reviewer.

This bias can also come directly from the publisher of academic books and articles. The publisher is in the business of selling books and journal articles; it does not want to upset potential buyers of its products. One publisher made it clear to me that its organization did not want any mention of problems that seem to be without a solution. The reader should be left with the impression that while there may be issues ahead, solutions are likely to be found.

In my opinion, any published research needs to be looked at very carefully. It is very difficult for an author to move much beyond the general level of understanding of his audience and of likely reviewers. There are financial incentives for authors to produce PC reports, and for publishers to publish them. In many cases, articles from blogs may be better resources than academic articles because blog authors are under less pressure to write PC reports.

Myth 7. Climate models give a good estimate of what we can expect in the future.

There is no doubt that climate is changing. But is all of the hysteria about climate change really the correct story?

Our economy, and in fact the Earth and all of its ecosystems, are self-organized networked systems. We are reaching limits in many areas at once, including energy, fresh water, the number of fish that can be extracted each year from oceans, and metal ore extraction. Physical limits are likely to lead to financial problems, as indicated in Figure 3. The climate change modelers have chosen to leave all of these issues out of their models, instead assuming that the economy can continue to grow as usual until 2100. Leaving out these other issues clearly can be expected to overstate the impact of climate change.

The International Energy Agency is very influential with respect to which energy issues are considered. Between 1998 and 2000, it did a major flip-flop in the importance of energy limits. The IEA’s 1998 World Energy Outlook devotes many pages to discussing the possibility of inadequate oil supplies in the future. In fact, near the beginning, the report says,

Our analysis of the current evidence suggests that world oil production from conventional sources could peak during the period 2010 to 2020.

The same report also mentions Climate Change considerations, but devotes many fewer pages to these concerns. The Kyoto Conference had taken place in 1997, and the topic was becoming more widely discussed.

In 1999, the IEA did not publish World Energy Outlook. When the IEA published the World Energy Outlook for 2000, the report suddenly focused only on Climate Change, with no mention of Peak Oil. The USGS World Petroleum Assessment 2000 had recently been published. It could be used to justify at least somewhat higher future oil production.

I will be the first to admit that the “Peak Oil” story is not really right. It is a halfway story, based on a partial understanding of the role physics plays in energy limits. Oil supply does not “run out.” Peak Oilers also did not understand that physics governs how markets work–whether prices rise or fall, or oscillate. If there is not enough to go around, some of the would-be buyers will be frozen out. But Climate Change, as our sole problem, or even as our major problem, is not the right story, either. It is another halfway story.

One point that both Peak Oilers and the IEA missed is that the world economy doesn’t really have the ability to cut back on the use of fossil fuels significantly, without the world economy collapsing. Thus, the IEA’s recommendations regarding moving away from fossil fuels cannot work. (Shifting energy use among countries is fairly easy, however, making individual country CO2 reductions appear more beneficial than they really are.) The IEA would be better off talking about non-fuel changes that might reduce CO2, such as eating vegetarian food, eliminating flooded rice paddies, and having smaller families. Of course, these are not really issues that the International Energy Association is concerned about.

The unfortunate truth is that on any difficult, interdisciplinary subject, we really don’t have a way of making a leap from lack of knowledge of a subject, to full knowledge of a subject, without a number of separate, partially wrong, steps. The IPCC climate studies and EROI analyses both fall in this category, as do Peak Oil reports.

The progress I have made on figuring out the energy limits story would not have been possible without the work of many other people, including those doing work on studying Peak Oil and those studying EROI. I have also received a lot of “tips” from readers of OurFiniteWorld.com regarding additional topics I should investigate. Even with all of this help, I am sure that my version of the truth is not quite right. We all keep learning as we go along.

There may indeed be details of this particular climate model that are not correct, although this is out of my area of expertise. For example, the historical temperatures used by researchers seem to need a lot of adjustment to be usable. Some people argue that the historical record has been adjusted to make the historical record fit the particular model used.

There is also the issue of truing up the indications to where we are now. I mentioned the problem earlier of EROI indications not having any real world tie; climate model indications are not quite as bad, but they also seem not to be well tied to what is actually happening.

Myth 8. Our leaders are all knowing and all powerful.

We are fighting a battle against the laws of physics. Expecting our leaders to win in the battle against the laws of physics is expecting a huge amount. Some of the actions of our leaders seem extraordinarily stupid. For example, if falling interest rates have postponed peak oil, then proposing to raise interest rates, when we have not fixed the underlying oil depletion problem, seems very ill-advised.

It is the Laws of Physics that govern the world economy. The Laws of Physics affect the world economy in many ways. The economy is a dissipative structure. Energy inputs allow the economy to remain in an “out of equilibrium state” (that is, in a growing state), for a very long period.

Eventually the ability of any economy to grow must come to an end. The problem is that it requires increasing amounts of energy to fight the growing “entropy” (higher energy cost of extraction, need for growing debt, and rising pollution levels) of the system. The economy must come to an end, just as the lives of individual plants and animals (which are also dissipative structures) must come to an end.

Conclusion

We are facing a battle against the laws of physics which we are unlikely to win. Our leaders would like us to think that it can be won quite easily, but it cannot be.  Climate change is presented as our only and most important problem, but this is not really the case. Our problem is that the financial system and energy systems are tightly connected. We are likely to have serious financial problems as we hit limits of many kinds, at more or less the same time.

Our leaders are not really as powerful as we would like. Even our scientific findings practically never come in perfect form. Our knowledge generally comes in a series of steps, which includes revisions to early ideas. At this time, it doesn’t look as though we have figured out a way to work around our rising need for energy and the problem with rising entropy.

 

About Gail Tverberg

My name is Gail Tverberg. I am an actuary interested in finite world issues - oil depletion, natural gas depletion, water shortages, and climate change. Oil limits look very different from what most expect, with high prices leading to recession, and low prices leading to financial problems for oil producers and for oil exporting countries. We are really dealing with a physics problem that affects many parts of the economy at once, including wages and the financial system. I try to look at the overall problem.
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1,605 Responses to Why political correctness fails – Why what we know ‘for sure’ is wrong (Ex Religion)

  1. Rob Bell says:

    Once the meltdown begins everything will come crashing down. If you don’t believe read Hank Paulson’s book to get an idea how bad 2008 really was. He told G.W. Bush if they didn’t bail out the banks, the world economies would come to a halt and there would have been Martial Law in the US with tanks roaming the streets to keep law and order.

    • Lots of rebuilding to do, but lots of people left out of jobs at the same time. If people can be forced to borrow more money to build “stuff,” GDP tends to rise.

    • Hi main thesis is, “Technology boosts incomes and saves nature.”

      If we would substitute technology for cheap energy, we would be in great shape. We cannot. Technology leads to greater wage disparity, as some become the owners and operators of the technology, and others are left without jobs.

      • Sven Røgeberg says:

        http://www.power-technology.com/features/featurecould-the-middle-east-go-fully-renewable-5819109/

        Nafeez Ahmed has revet ly at least twice refered to a study under the leadership of Finlands first Professor of Solar Economy.
        To good to be true?
        https://www.researchgate.net/profile/Christian_Breyer

        • Sven Røgeberg says:

          If you skip both ends of the article, I can recommend the four axioms of Jonathan Rutherford. You could argue over some issues, but the big picture is close to what Gail is elaborating.
          View story at Medium.com

          • lots of amusement to be had there.

            As I pointed out to Rutherford in a comment on that article, he makes no mention of political chaos—which will be the main problem we face over the next 50 year or less. (He did acknowledge that, to be fair)
            He goes along with the popular fantasy that all will be well and we can become gentle gardeners (or something)–take out 90% of energy input and that’s all we will have left. trust me on that.

            He also exposed glaring ignorance of what “capitalism” is–saying that it started 300 years ago

            Totally wrong. 300 years ago was the point at which capital started its diffusion among the lower orders (ie you and me).
            Before that time, capital (the means of energy production) was in the hands of kings and nobility and the church.
            Fossil fuels provided everyone with capital (energy availability–cars houses planes healthcare etc)

            Societal reconstruction?? Does OFW advocate that or suggest it can be done? That’s Heinberg territory I think.

            Who will oversee that?—It will require a controller with powers of enforcement, (globally) and controllers (aka dictators) are invariably unpleasant individuals.
            They will readily recruit enforcers who enjoy using force. (they always do)
            I can guarantee that it will carry religious overtones with it.

            Do you seriously imagine that 190 nations will accept that? Check El trumpo night now—He’s picking an EPA head who insists CO2 is not a pollutant –50% of Americans believe that.

            Need I go on?

            the concept of the middle east going fully renewable takes hilarity into the realms of hysteria.

            In case you hadn’t noticed, the Mideast is in a state of permanent conflict.
            Saudi Arabia holds itself together by using oil money to buy off different factions, so they can gold plate their cars and fly them the London every summer.
            When the oil finally goes, SA will explode as will the rest of that region—far more than now.

            Do I need to elaborate on what would happen to 100 sq miles of solar panels in a conflict?
            Leaving that aside, solar panels need constant washing—particularly in deserts.
            That requires water, which the locals are short of.

            The only ultimate use for saharan sand is sticking heads in. They are good at that—but so are we.

            • theblondbeast says:

              It’s cold comfort to think that what might save us from FE’s spent fuel rods is the brutal crack down of authoritarian governments on the rise. But I do think you have best made this point. In the same way that there are good reasons (articulated by Gail) to think oil prices may drop rather than the default assumption they will rise, I think there are good reasons to believe the end of BAU means at least a temporary increase in militant government. Note: This does not mean law and order won’t also decline, as seen in Venezuela.

        • Fast Eddy says:

          April 1 is still some months away…..

      • ++++++++

        Even without the impending collapse scenario… The increasing number of useless eaters would not be able to afford the output of a fully automated economy no matter how affordable the products become or how much basic income you provide.

        We have already invented a system whereby unnecessary purchases are made by encouraging false values to gullible creatures that truly believe that swapping their 40″ LCD TV for a 50″ LED TV is going to revolutionize the meaning of personal happiness and joy in their lives.

        The fact is that we don’t even need to employ built in obsolescence any more because the deliberately staggered release of incremental technological improvements will suffice to continue the churn of routine purchases until saturation is complete.

        The driving force of national economies – vehicle sales – has been faltering for some time with car sellers looking more like loan sharks and insurance brokers now. The churn of swapping a new vehicle for an upgrade every few years has reached peak and the economy cant run on used car sales or any other second hand market.

        So what gives… We are funding technological improvements to allow the transfer of large numbers of people from A to B and back again. That is essentially what is happening. And many of those people are only doing so because it allows them to earn money to spend on bigger and better and fancier vehicles with which to travel back and forth between A and B. And this strange activity allows others to sell coffee and snacks to these individuals and yet others to fix their vehicles when they break down.

        And swapping out the petrol engine for electric batteries does nothing to change the fact that most of the travel from A to B is a complete and utter waste of time and energy.

        What will the owners and operators of this fraudulent system do when they realise that the more you automate everything the less people will be able to make use of said automation?

        The general argument is that everything gets cheaper with further automation and economies of scale. The truth is that people are paying more and more every month of their lives just to stay alive and keep up with the Joneses because the smartypants didn’t factor in that human stupidity and greed would also increase.

        • I think you are right about this. Swapping 40″ LCD TVs for 50″ LED TVs doesn’t get us very far; sale of used vehicles does not stimulate the economy in the way that the sale of new vehicles does.

          It would seem like expenditures that truly help the world economy become more efficient in producing and delivering goods and services would help the economy. We can think of a lot of examples:

          1. Anything that produces better interconnections among different “nodes” of the economy. Building roads for the first time was helpful in this way. Adding additional lanes to accommodate more traffic might be helpful in this way. Even finding approaches to regulate traffic, so it flows more efficiently, such as different lane patterns and lights for regulating the addition of new traffic to an expressway. Adding railroads, years ago, was helpful in this regard.

          2. Another thing that produced better interconnections would be the internet. Also, higher level government organizations, to encourage flow of goods among countries.

          3. More efficient machinery and self-driving cars would seem to go in this direction. So would more higher education.

          4. More debt availability at lower interest rates, would seem to make goods more available to buyers.

          —-

          The catch as we go this way is that there is too much wage disparity, and too many jobs are cut out.

          We can think of another way of helping the economy, namely increasing demand for commodities. This comes from either (1) strengthening the buying power of the 90%, or (2) somehow, directing the money that is spent toward goods that wear out quickly, or for some reason need to be replaced.

          In this regard, reselling cars to other buyers is not very helpful (although the wages going through the economy are somewhat helpful, in allowing car salesmen to afford new homes and cars, for example). Selling a new car or home is more helpful, because of the large amount of commodities used in building these cars or homes. Remodeling or rebuilding after storms is helpful, too, in increasing demand for commodities.

          Whenever one change is made to the networked economy, multiple changes are made at the same time. It becomes more and more difficult to say what is “good” and what is “bad” for the economy. Adding more international organizations is good for a while, but then the problem becomes too much wage disparity. But it does help keep up demand for commodities, and thus prices.

          • What is the goal?

            Do we have purpose?

            You see… I’m just not what you would call the model consumer. I’ve never been that materialistic. If everyone was like me… there wouldn’t be an economy. As a kind of modern day techno-monk / hermit I do use a limited amount of tools to get things done but that’s about it. I get a rash when I have to go clothes shopping or spend more than the usual to get something done. If I can do something myself I will and I don’t replace things until they break.

            Imagine for a moment that the young people you speak of achieve their higher education goals and most of them end up in low paying jobs working from home as is feasible for an increasing number of jobs today. In oterh words, they choose the lower pay in exchange for improved work / life balance.

            It may be that they would still have the same needs that a commuter would have. It may be that they choose to live in a property already owned instead of moving to a rental property closer to work. It may be that they don’t need a fancy commuter vehicle so opt for a practical runaround or other cheaper options.

            I don’t know… I just don’t see much purpose in accumulating more material goods which once saturation is reached leads to upgrading and replacing. I understand that people can write millions upon millions of pages on how important all of this activity is and how it’s REALLY important for the economy… but I don’t get it… and never will.

            There it is… housing and transportation are the core of this economy thing. And It seems logical that the solution would be to entice the rest of the world that doesn’t yet have these things to begin aquiring them. And when everyone has basic housing and transportation the next step is through advertising (devious psychology) to entice them to earn more and aquire the next level up in living standards and goods and on and on until everyone is just replacing what they have because they can.

            Again… I don’t know about you but this game doesn’t interest me in the slightest. Their is no authentic directional purpose to it. It’s the equivalent of digging a hole and filling it and because someone somewhere has figured out a way to extract wealth from this game it is deemed a successful endeavour by all involved… even the losers.

            I want something more. Call me greedy, needful even… but I would prefer for humanity to work together towards some greater goal that is not simply the aquisition of more and more material goods to satisfy a fraudulent economic market that was specifically designed to insidiously extract wealth from the 99% to enrich the 1%.

            Now… what could those goals be and why haven’t we started work on them?

        • Tim Groves says:

          OK, I’ll come clean. I’m the one who’s been putting a break on the economy all these years.

          The last time I flew was in 1995. After the events of the 11th of September 2001, I decided I would never do so again, and the regular trickle of air rage and airport security hassle stories and the recent Malaysian Airlines incidents merely underlined that decision for me.

          I’ve never owned a car or been tempted to buy one. The single biggest reason for me is I couldn’t live with myself if I knocked somebody else down while my concentration was elsewhere. But tax, insurance, loans, vehicle maintenance and testing, parking, garaging, cleaning gasoline, red lights, congestion, road rage, and seeing other people on the road whose cars are cooler than mine take all the fun out of the idea of car ownership for me.

          As for the TV, which we only use as a video screen these days, I was happy enough with a 24-inch and only upgraded to the present 32-inch because the old set couldn’t handle the conversion to digital TV. Bigger than 32-inches I have no desire to accommodate.

          • Well… you and me both! Cuff me now and throw away the key. When I was a lad I really did believe that I was a human being. Uff How wrong I was… apparently I am… wait for it…

            a consumer
            a polluter
            a taxpayer
            a denier
            a heretic
            a potential terrorist
            a debtor
            a left wing / right wing kook depending on which way the wind is blowing
            a conspiracy theorist because I like to research topics deeper than the average bear

            These are all honorary titles by the way. I didn’t actually have to lift a finger to attain any of them.

  2. Kurt says:

    Once again, ofw is kind of boring tonight. Lets raise our game a bit people! A new topic – why are rich people unconcerned about our current state? I know, I work with them. They could care less about this any of this stuff. They are planning 10 years out. And pleeeeeeease don’t start with the bunker nonsense,

    • Mark says:

      Cornucopian myth of unlimited resources.

      • William Catton’s book “Overshoot” is good.

        As long as people believe that the only direction for energy prices to go is up, when there are shortages, they misunderstand the real problem. Catton understands at least part of the problem.

        • Artleads says:

          So when you repeatedly say that fuel prices need to go up, I guess you mean go up as an emergency measure to prevent an earlier crash.

    • Davidin100millionbilliontrillionzillionyears says:

      hey Kurt!

      life isn’t all this:

      you know?

      not non-stop action!

      but re: “rich people”…

      humans discount the future!

      a person with lots of dough for the next “10 years out” has gotta make some plans.

      “they” most likely are discounting “20 years out” to zero.

      now, myself, being a semi-Doomer…

      I would say to plan 10 years out but with low confidence in BAU.

      if BAU holds, then that sorta works.

      if BAU turns into The Collapse, then go to plan B.

      though…

      I don’t know any plan B that might work.

      so there’s that.

      cheers!

      keep the BAU-LL rolling!

    • This has been addressed here several times already.

      First of all, lets be real and differentiate a bit, you most likely refer to the upper middle class and or lesser nobility. I seriously doubt you personally hang out with the royals and or the share holders of the global financial reserve system, or the Russian/Chinese deep state etc..

      Most of the visible “rich” level are simply one time wonders or originating from the pedigree of few generations of inherited and properly managed wealth. They are born and accustomed to past ~150yrs of more or less same quasi stable system in which it is not that hard to make few %thousands each decade or two in various up and down cycles, and hence beat the inflation, evade the occasional wider wars and revolutions, simply stay on top. Obviously, it’s not 100% success rate for everybody, there are also some waste and dropouts of this wealth due to sheer incompetence, fraud, bad luck in politics/timing etc.

      So, in total this culture breads overconfidence, they feel indestructible in reasonably weathering smaller cycles and societal upheavals, but as history shows they usually can’t survive longer-larger one impacts like ~300/500/1000s yrs cycles of profound changes..

      PS The top of the top finacial guys have direct access to gov/mil bunkers (not saying this will help them in the end), and I’m not going to discuss some silly family sized installations you might have on the mind, which are on the market for the ordinary folk as well..

      • Overconfidence… they feel indestructible

        That just about sums it up… and we all know where that leads…

        The cheats have to outcheat all the other cheats until there’s no cheating left to be done…

        And we all fall down…

      • Fast Eddy says:

        I was on skype with a friend who while not in the private jet class… retired at 42 and is well set… having a discussion about Bitcoin (and tulips)…

        I explained that I was not particularly interested in understanding Bitcoin and that I was more focused on the energy situation because that trumps all other issues…

        He did not disagree with my take on the energy situation but ranked in terms of concerns up there with running out of fish and fresh water… things that are certain … but not necessarily imminent.

        The consensus was all of these things could go on for a very long time — so better to keep dancing while the music plays.

        Maybe he is right on energy… I expected BAU would be long gone by now….

    • xabier says:

      To care would place in question the fundamental premise on which their lives are built: that all those little zeros in their bank accounts and the valuations of their real estate represent a durable reality.

      A bit like trying to convince an Ice Age hunter that the meat he’s chopped up wouldn’t keep under the frozen stone pile and would be rotten when he tried to eat some in 3 month’s time. To awful to contemplate.

      Also, none of them have any experience of serious civil disorder aimed directly at grabbing what they have. They expect the mass of society to go down quietly, living on welfare,and to come out on top even if some assets are wiped out or reduced in value. Being able to invest globally helps maintain this illusion.

      • +++++++++

        They expect the mass of society to go down quietly…

        Hah good luck with that…

        • Tim Groves says:

          I was listening to Alex last week on the LA shootings and he was adamant that there were lots of real victims — something along the lines of “This is not a hoax, folks!” One of the reason’s he concluded that after looking at the video evidence was that he has been hunting elk in the US and game in Africa and has taken his son hunting, and often a high velocity will go in one side of the animal’s head and out the other and the wounds will not necessarily be easily visible or result in blood spurting out all over the savannah.

          • Fast Eddy says:

            Like JFK!!!

          • Ha! Case closed.

            Controlled opposition are free to twist things however they want as long as it prevents the punters from actually getting to the truth.

            My take on this… we are embedded in a narrative where all sides are playing a role conducive to the pursuit of an endgame of sorts. That endgame has always been total and absolute power over life on earth. And once that goal is achieved to procede with the destruction of god’s creation (their words not mine) through the gradual replacement of every element of it (GMO, transhumanism, robotics, AI, depopulation etc).

            This is the narrative that I’ve uncovered over the years. Your take on things may be something entirely different.

            In my opinion… this goal is relatively simple to implement. Once you have the majority of people hooked on BAU, then all you have to do is threaten the removal of it and people will do anything you ask of them.

            > walk away from the king and perish
            > accept further loss of freedoms but survive comfortably

            As a fully domesticated species I believe poeple will opt for the least painful option. And of course it may be the case that the controllers have not fully understood the process of overshoot… or maybe they have and that is part of the goal.

  3. psile says:

    Something you don’t see every day…a hurricane this far in the north Atlantic. Expected to make landfall as a CAT1 storm in Ireland tomorrow.

  4. psile says:

    And from the book of fairy tales…

    Can Canada’s Population Reach 100m by 2100?

    Hmm, the opening reads…”Canada’s population needs to triple to 100 million by 2100 if it is to continue to stay relevant on the international stage.”

    More like, Canada’s population needs to triple to 100 million by 2100 if it is to continue to with it’s non-stop Ponzi schemes.

    • Davidin100millionbilliontrillionzillionyears says:

      I don’t have the source, but anyway…

      I’ve read that Canada annually exports a higher % of its resources than any other nation.

      that’s certainly the Ponzi way to have more wealth today and less wealth in the future.

      but if they time it right, they can stay sorta wealthy until The Collapse.

      perhaps that’s a good plan?

    • “Non-stop Ponzi schemes” — good point!

  5. Fast Eddy says:

    Pulled from the comments https://srsroccoreport.com/worlds-largest-oil-companies-deep-trouble-as-profits-vaporize-while-debts-skyrocket/

    NASA Study: Industrial Civilization is headed for Irreversible Collapse (Motesharrei, 2012)
    http://jayhanson.us/_Biology/OvershootCollapse.pdf

    UK Royal Society Study: Now, for the First Time, a Global Collapse Appears Likely (Ehrlich, 2013)
    http://rspb.royalsocietypublishing.org/content/280/1754/20122845

    Study: Limits to Growth was Right. Research shows we’re nearing Global Collapse (Turner, 2014)
    http://sustainable.unimelb.edu.au/sites/default/files/docs/MSSI-ResearchPaper-4_Turner_2014.pdf

    Study: Financial System Supply-Chain Cross-Contagion: in Global Systemic Collapse (Korowicz, 2012)
    http://www.feasta.org/2012/06/17/trade-off-financial-system-supply-chain-cross-contagion-a-study-in-global-systemic-collapse/

    The End of the Human Race will be that it will Eventually Die of Civilization –Ralph W Emerson

  6. adonis says:

    the elites have a plan B and OFW’ers have completely missed it how have they missed it they have failed to do the research and connect the dots to connect the dots you need to have an open mind open to all sorts of possibilities and the main possibility being that ever since 2008 the ‘patient’ has been in a coma yet Bau continues and it will continue for another ten years once 100 % of all the world’s interest rates permanently enter the twilight zone of negative interest rates.it feels so good finally knowing the truth that this industrial revolution will continue for a lot longer

    • psile says:

      Ok Mr. Smartypants. What is it? ZIRP/NIRP have already been tried where it counts. NIRP in Albania or Zambia, for example, does not.

    • Tim Groves says:

      My take:

      Collapse—the end of BAU—will all always seem to be ten years away right up to the point when it occurs due to a catastrophic systemic failure that can’t be repaired or worked around.

      There will be no official advance public warnings because that would be counterproductive.

      Any major failures that can be averted with shoring up or repaired with duct tape will surreptitiously attended to and any overt signs that collapse is approaching will be papered over, so to the commonsense conformist eye, everything will seem to be running normally right up until we step off the Seneca cliff.

      The impending collapse will not be televised.

      • Greg Machala says:

        I too think that things will just come to a stop. There will be no warnings or panels of experts on TV talking about it. The credit markets will seize up at some point. It will be touted as temporary. However, shortly there after, “CLOSED” signs pop up everywhere. You run out of gas in your car and then the power fails. Chaos ensues when people realize the power isn’t coming back on and they are hungry. Communications are down and chaos is everywhere. I doubt there will be police keeping order in the streets either. The police will be hunting for food too.

      • You may very well be right. The plunge protection team will work overtime, until at some point, asset prices drop all at once, and banks fail. Or China will have a major problem that cannot be contained, and will spread to the rest of the world.

      • Mark says:

        Agree with the above(s) A week or two until you envy the dead.

        (Korowicz)

      • Fast Eddy says:

        This is along the lines of what I was thinking when the power went off the other day…. no announcements… just one moment its BAU.. and the next the bubble I live in is gone….

        As we know the news is a propaganda tool — it does not exist to inform….

        So why would we be informed when BAU is going down? What do they give a f789 about letting us know the world has ended?

        We know that those who control the MSM think of us as cattle….go yim = cattle. Stupid dumb animals….

        We know that they will kill innocent people without hesitation – IF it is their interest. Sure they’d like to keep their herd around but that would be impossible – so why bother to even give us a heads up. We do not matter (and we don’t)

        I would imagine that when the end comes they will hop into their choppers and lock themselves into their mega bunkers and just leave the cattle to wander around in confusion wondering why the lights aren’t coming back on….

        And then the feeding frenzy will begin.

        I might add that if that’s the way it goes down this is going to be such a let down. I was hoping for coverage of mass riots… cities in flames… Wall St bankers jumping from towers….

        And I probably won’t even get a chance to tell anyone — SEE – I TOLD YOU SO!

        If this is the way it goes down I will definitely need some anti-depressants to get me through the last couple of weeks of life….

        • “I was hoping for coverage of mass riots… cities in flames… Wall St bankers jumping from towers….”

          Dude… that’s been happening for years. So the prelude phase is done and done. We’re on the main course now. Pull up a chair and tuck in.

          And judging by the overly descriptive nature of your posts over the years it baffles me why you’re not already knocking back the happy pills with gusto. What are you waiting for? Enjoy!

          • Fast Eddy says:

            When I use the word riot … I am referring to real riots — not lame protests broken up with a few puffs of tear gas and a splash from a water cannon.

            I want riots in OECD countries that are out of control — burning down cities —- police gunning down people in the streets — total chaos.

            I wanna see major cities turned into war zones.

            I want to watch the 4 horseman of the Apocalypse ride in and lay waste.

            I want to be……………. ENTERTAINED.

            How disappointing to be down here on the farm … knowing that this is going on … and not being able to tune in….. to not be able to watch the greatest moment in history with play by play…. it defeats the purpose of collapse.. it’s like a giant tree falling in the woods — and not being their to watch and listen

  7. J. H. Wyoming says:

    https://www.bloomberg.com/news/articles/2017-10-15/yellen-says-fed-to-raise-rates-gradually-as-inflation-picks-up

    “Federal Reserve Chair Janet Yellen said that the U.S. central bank expects to continue to raise interest rates gradually as solid growth, a strong labor market and a healthy global economy lift prices even as she recognized that inflation has been surprisingly low.

    “My best guess is that these soft readings will not persist, and with the ongoing strengthening of labor markets, I expect inflation to move higher next year,” Yellen said Sunday at the Group of Thirty’s Annual International Banking Seminar in Washington.”

    My goodness the FED are amazingly good at making stuff up to push the idea of raising interest rates ever further into the future. Now Yellen expects inflation to go higher next year. What happened to raising interest rates 3-4 times in 2017?! It’s getting to be a laugh! Obviously they can’t raise them because then all those loans would go belly up, the stock market would tank and there would go the so called recovery. The FED are professional BS specialists.

    • adonis says:

      the fed may have done enough by raising rates to the level they are now to allow public perception around the world to blame the US, Trump and the Fed when the system implodes this will be the perfect opportunity for the Currency Reset to be introduced that will be spearheaded by China and backed by the IMF. Once this system is offered to the world’s governments they will jump at it as they will have no solution to the deflationary death spiral they find themselves in when the system implodes, i am now all set up to enjoy the coming collapse with all my favourite foods and drink (wine) and watch this blockbuster movie play itself out we are only weeks away or less when the system implodes i will only say this one more time physical gold or silver will decide whether you end up a slave or a freeman in the foreseeable future

      • Fast Eddy says:

        You are in for the mother of all surprises….

      • There are couple of problems with your scenario:

        – certain faction of US elite might get even more insane from the perspective of the country looming disintegration and irreversible abject poverty, hence they will start lobbing nukes first, be it in proxy war or directly hitting top contenders, outcome very unclear..

        – probability of getting new albeit temporary plateau attempt of reworked global financial arrangement where the western powers suddenly play a much lesser role is indeed not zero, but you fail to think it through the necessary conclusion in the era of depletion as it necessarily must function as very deliberate oppressive and re-distributive system, where little people can hardly maintain their “freedoms” status-purchasing power by the same tools of the big player, this holds true especially on the “loosing part” of the conflict, ..

        – that schadenfreude moment after the realization of what’s happening will be be very brief to enjoy and in many places it will actually fuel the chaos, even in some lucky enclaves managing temporary plateau it might materialize at best as in some noticeable level of impoverishment, loss of liberties, ..

      • J. H. Wyoming says:

        “…when the system implodes this will be the perfect opportunity for the Currency Reset to be introduced that will be spearheaded by China and backed by the IMF. Once this system is offered to the world’s governments they will jump at it as they will have no solution to the deflationary death spiral they find themselves in…”

        Agreed, as it is the most logical next desperate step to be taken, but not sure it will do much of anything. Keep in mind just how massive the bubble has been blown and how enormous the world economy has gotten with China on board. Once that ship sinks, sure, what you wrote above will be attempted, but if only a small percentage of people can participate then what good is it? Those with silver and gold might be able to buy a little more food & water, but the overall economy will still list and sink. Then hundreds of millions or even billions will have a hand out and chaos will ensue. Plus the underlying cause as we all know it here will not have changed.

      • alex says:

        If maybe I mistaken .But I think you are Cathal “putrid”

    • Greg Machala says:

      Yep it is all bull$hit now. Have faith and believe.

  8. interguru says:

    Ben Bernanke is worried — and perhaps we should be, too.

    As chairman of the Federal Reserve from 2006 to 2014, it was Bernanke, along with others, who prevented the worst recession since World War II from becoming the Great Depression 2.0. Now he fears that, should another sharp recession occur, the Fed won’t be able to contain it.

    ……………………..

    In a paper presented recently at the Peterson Institute for International Economics, a Washington think tank, Bernanke judged that these policies — to some extent — had helped end the Great Recession and sustain the recovery. What troubles him now is the possibility that the same policies won’t work in a severe recession or financial crisis in the future.

    http://www.realclearmarkets.com/articles/2017/10/16/ben_bernanke_is_worried_maybe_we_should_be_102921.html

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