Why oil prices can’t rise very high, for very long

Oil prices are now as high as they have been for three years. At this writing, Brent is $74.14 per barrel and West Texas Intermediate is at $68.76. These prices aren’t really very high, if a person looks at the situation from a longer term point of view than the last three years.

Figure 1. EIA chart of weekly average Brent oil prices, through April 13, 2018.

There is always a question of how high oil prices can go, and for how long.

In fact, we have many resources, of many kinds, whose prices of extraction keep rising higher. For example, obtaining fresh water for the world’s population keeps getting more and more expensive. Some parts of the world need to resort to desalination.

The world economy cannot withstand high prices for any of these resources for very long. Certainly, it cannot withstand high prices for a combination of necessary resources, because people need to cut back on other purchases, in order to afford the necessities whose prices are rising. This article is a guest post by another actuary, who goes by the pseudonym Shunyata. He explains in a different way why high resource prices cannot last, whether they are for oil, or natural gas, water, or even fresh air.

Dear Readers:

As you are no doubt aware, Gail has created a fantastic portfolio of blogs that explore our energy/financial/economic system, blogs that reveal many hidden or misunderstood aspects of our situation. I have found these discussions invaluable and share them wherever I am able; to solve our societal problems we need to develop a societal understanding of these issues.

The problem I face is helping other people, like my grandparents, get a foothold in this complex discussion. They can understand why oil might “run out,” but trying to understand the problematic financial situation is more difficult. I like metaphors to explain things – metaphors that allow my grandparents to understand the major elements of the situation. The metaphors I am using are to the oil industry. My grandparents have been following the oil situation for a long time. If a person has been following the oil industry, they may be helpful.

Below you will see how I explain Gail’s detailed writing to my grandparents in three short chapters. I hope you find this outline helpful in your own discussions, and I welcome your suggestions for improving the transparency of the story.

PRODUCTION COST

What if air had to be produced from wells and purchased by businesses and families to conduct their normal affairs?

If air is readily available in the ground, we can always extract what we need, making it easy for businesses and families to operate, or even to grow.

What happens if air becomes harder to extract? Perhaps the easy air is gone and we are increasingly looking at extracting deep water air, or air dissolved in shale stone.

Technology may be able to help; sometimes it can help a lot. But there is an immediate production cost shock in funding the development of that technology. This cost shock occurs whether we are talking about conventional air or solar-based renewable air.

There is a lower but permanent increase in production cost, both to fund the complexity of the technology (a deep water air rig just costs more to operate than a land rig) and to pay off any debt needed to build the new technological infrastructure. This cost increase occurs whether we are talking about conventional air or solar-based renewable air.

This cost increase is a permanent drag on the economy. Wages don’t rise to compensate for the higher cost of air. There is no substitute for air, and air simply isn’t available in the quantities the economy previously enjoyed – unless we stop doing things that we were doing before and redirect those resources toward producing the same amount of air we used to have.

DEBT

In a modern financial system, we use “money” as a proxy for economic activity. In a barter system, I can obtain goods and services by trading my work product for your work product. But carting around packages of finished goods is unwieldy, so we use “money” as a medium of exchange. If you and I are both willing to trade our finished goods for a symbolic piece of paper, then I can trade my goods and services for paper, bring that paper to you and trade it for your goods and services. This medium of exchange makes it easy to trade complex goods and services over long distances, or at different points in time.

How would lending work in this barter system? Someone could produce many finished goods, trade it for symbolic paper, but not immediately trade it for other goods, and “save” their paper for later. Debt is a process of borrowing someone else’s saved symbolic paper to purchase goods and services for themselves. This is helpful when I need to build a deep water air rig but don’t have the money myself. I can borrow someone else’s money and pay them back later, after my rig is bringing in revenue.

This simple borrowing process only works if some people aren’t consuming goods and services in the economy, and are instead allowing others to “borrow” their ability to consume. What if there isn’t enough saving to make large borrowing possible? What if I want to maximize economic activity and don’t want people to defer their own individual consumption?

If we want more funding than barter can provide, this can be done in more than one way:

[a] Money can be loaned into existence. This happens every day, when people decide to buy a car, and take out a loan for that purpose. Or people buy something with a credit card, and decide to carry a balance, rather than pay it off immediately. Nearly all loans today represent new money to the system.

[b] Governments can also obtain money by issuing bonds. Or they can simply issue money certificates without having any backing for the money.

Let’s call the process of adding funding to the economy, over and above what would be available by debt, “money printing.” In each of these cases, symbolic paper is added to the economy without previous work having been performed.

[1] Money printing can be helpful when it represents an investment in growing the overall economy. Investment in deep water air rigs will make air more available in the economy and will spur an expansion of economic activity. In this case the goods and services in the economy eventually “grow into” the amount of money that has been printed and the extra economic activity in the future is used to repay the debt.

[2] Money printing is unhelpful when it simply becomes someone’s savings (i.e. growing wealth inequality). The economy is still obligated to repay the debt (usually through taxes) and economic activity becomes sequestered in wealthy people’s savings, without ever creating demand for someone else’s product.

[3] Money printing is also unhelpful when it is used to fund more air consumption without any investment in air production. For example, a family that borrows money for an air vacation (or for basic daily air subsistence):

  • Now has a debt–repayment of which will reduce future air consumption
  • Has created no permanent demand for air and does not require permanently expanding air production for the economy–so their vacation air demand tends to increase the cost of air for all other consumers.

PRICE
What happens when we put these two chapters together? When air becomes more difficult to extract:

[1] Production cost goes up permanently.

[2] Economic activity is redirected to maintain air production, and overall economic activity is reduced. With reduced overall economic activity there is a reduced need for air, resulting in excess air supply and a temporary reduction in air price.

[3] If air consumers spend their available money on air and defer other purchases, there is an additional reduction in economic activity, additional excess supply and further reduction in air price.

[4] Reduced price means less revenue to air producers.

[5] Owners of idled air rigs still have debts to pay (money borrowed to build air rig in the first place). They are willing to undercut the market price of air just to get revenue to pay their debts, even if they aren’t making a profit otherwise. This drives the price even lower.

So air prices fall, even though the cost of air production continues to rise.

This begins to look like an economic crisis. A natural response of governments is to print money so that consumers have more money available to purchase air, without deferring other purchases.

This can work for a while, but ultimately fails when there is no overall growth in economic activity to match the increased money supply. The debt comes due (usually in the form of higher taxes). There isn’t enough productive activity in the economy to easily pay back the debt. As a result, consumers must defer even more of their consumption to repay debt, ultimately resulting in even lower air prices.

Eventually either the debt market or air market runs the risk of failing entirely.

[1] When economic activity falters, people can no longer repay their debts (or earn enough income to pay taxes toward government debt). Either of these outcomes is bad both for borrowers and lenders.

[2] If economic activity falters, market forces push air producers to a zero-profit price point. At this point, producers have enough money to keep the rigs running and cover debt payments, but no more. Ultimately this cannibalizes the ability of air producers to maintain existing air supplies. They are unable to purchase replacement machines, if any one breaks. They cannot make new investments.

Clearly, this situation cannot continue. High prices cannot be passed on to consumers, or they will be unable to buy other necessities of life. At the same time, if the producers do not get high enough prices, they cannot continue to provide the air or any other commodity that is needed.

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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1,703 Responses to Why oil prices can’t rise very high, for very long

    • Where do the authors of this article think that buyers will get funds to pay “triple-digit prices” for oil?

      • Baby Doomer says:

        What happens when $250 trillion in global debt runs smack into $100/bbl oil?

        • Slow Paul says:

          Then we get $70 oil and $350 trillion in global debt.

          • Greg Machala says:

            You cannot replace energy with debt. If resource prices cannot remain high enough to be profitable then, companies that produce those resources go bankrupt. Those resources then become unavailable. This continues until a critical amount of resource drops out of reach and the system collapses. Things are holding together on the sheer momentum of the energy producers.

            • Davidin100millionbilliontrillionzillionyears says:

              “If resource prices cannot remain high enough to be profitable then, companies that produce those resources go bankrupt.”

              yes… and these rising prices should reduce bankruptcies…

              “Things are holding together on the sheer momentum of the energy producers.”

              yes… and these rising prices should aid that momentum…

            • Rising resource prices reduce one kind of bankruptcy (producers) and increase another type of bankruptcy (consumer). It is a no-win situation.

            • Pogo says:

              “You cannot replace energy with debt.” tell the frackers that :). Bankruptcy is not based on any physical law it is completely arbitrary. Has mark to market been reinstated ten years later….

    • MG says:

      When the debts go up, the energy prices must go only down…

    • Davidin100millionbilliontrillionzillionyears says:

      oil was in the $100 range from 2011 until mid 2014…

      I don’t recall a “full-blown oil shock” in those years…

      • The shock was the slow deterioration of Brent oil prices in the 2011-2014 time period, with the rapid drop-off starting in 2014. The higher prices reduced demand sufficiently that prices dropped–slowly at first, then more quickly later. These low oil prices are now working at setting off an even worse crisis.

  1. Baby Doomer says:

    Dying small rural town in America starter pack

    • Dan says:

      https://www.msn.com/en-us/money/companies/fiat-chrysler-thinks-people-want-a-dollar70000-pickup/ar-AAwjRzP?li=BBnbfcN

      I see people all the time driving $45k+ trucks (Texas) and I have to wonder how they afford it and more importantly what in the heck are they thinking. That kind of money for a rapidly depreciating asset / item.

      • Duncan Idaho says:

        Well, there does seem to be a small penis problem in Texas—
        Big, expensive Trucks seem to be the solution.

      • Greg Machala says:

        What people want, need and can afford are different things. Yes I want a $200,000 Ferrari but don’t need it and can’t afford it. All my friends here in Texas say they want a simple, conventional pickup truck $20,000 or under. Vinyl floor; mats, manual windows, two doors and a large bed that gets 20-MPH hwy.

    • Sungr says:

      Several of us were talking about this subject recently- How can the average US wage earner afford these fancy PU trucks w average cost of $47k? And easily going up into the $70 to $80k.

      We figured out that what happens is that “consumers” are mostly tied in to the auto credit financing system. So they just basically need to set aside from their household budget a permanent $400-600/month payment – which will be their reserved auto finance payment. This is a permanent financial committment for their vehicle ownership.

      So… when they buy a new vehicle what happens is mostly a credit market event. The “consumer” pays for the new vehicle by transferring his permanent auto finance into a new vehicle account. So they are paying $500/month for the old vehicle which is transformed into a new vehicle payment of $525.

      The old PU gets reprocessed by the financial department and ends up on somebody poorer’s vehicle account- again all as if by magic.

      It’s all done by magic by the credit department with little hassle for the “consumer”.

      • Dan says:

        Where I work there are about 20 guys and there are six decked out trucks sitting in the parking lot. All of them immaculate and pretty new, I know for certain none of them make over 45k a year. I also know none of them are putting anything toward their retirement. I’ve often toyed with the idea of offering an after hours financial class for them (Financial Peace / Dave Ramsey). I make a bit more than most here but I’ve been around longer and drive a beater 10 yr old car and have an even more of a beater truck that I use for my weekend vehicle (all paid for with cash).

        Every time I think of doing a money class I also have to ask myself why bother, maybe I’m the one that needs a class. Especially when I have little confidence toward the future maybe I should pull the FE card and live like there is no tomorrow. I readily admit to being a prepper – lite, even though I agree there is no amount of prepping for a BAU ending at least I’m prepared for Hurricane Harvey style events. More than anything I plod along for the sake of my own sanity.

        What is the saying about the man with one eye surrounded by a bunch of blind fools?

        • Greg Machala says:

          I don’t put anything into retirement either. I don’t think it will be much left of this country in 10 years. I am spending the money now and enjoying life. It is a calculated risk … yes … but, my confidence level is really high that industrial civilization is well within its last decade of life. The more people that buy expensive toys…the longer this show will last. So, be merry, and spend and do the things you want to do – today. Smell the roses. As far as living life on planet Earth, this is as good as it gets folks.

          • jupiviv says:

            “As far as living life on planet Earth, this is as good as it gets folks.”

            Can’t agree with this since it assumes an inherent connection between industrial lifestyle and happiness. In my own life I try to uphold the moral of Kierkegaard’s famous parable about the lilies of the field.

            • Fast Eddy says:

              You are most welcome to try the hunter gatherer lifestyle … perhaps you may find that more to your liking…

              Personally… I like living in a house… being warm… having a fridge filled with food… having leisure time… sleeping in a modern bed… drinking coffee… being able to turn a knob and cook food…

              But that’s me….

            • jupiviv says:

              Even with all that you’re a miserable sod obsessed with insta-collapse and worldwide heating – which was precisely my point. Happiness != access to BAU.

            • Fast Eddy says:

              And here we have an example of sore loser lashing out at a World Champion …. note the vitriol … the seething bitterness… one can picture the poisonous battery acid like froth coming from your mouth….

              Moral of the Story – Beware of the World Champion. World Champions do not happen by accident…

            • jupiviv says:

              Yes, this is what I meant. Only miserable sods claim to be world champions on blogs about industrial collapse.

            • Fast Eddy says:

              Not claiming… Am. This is acknowledged…. I have multiple belts.

            • Yorchichan says:

              You have to be a delusistani to be truly happy in a life utterly without meaning which always ends in tragedy. Or life’s a bitch and then you die, as we used to say in school.

              The best kept secret on Earth is and always has been that human life sucks, even if you have indoor plumbing.

              And it doesn’t just suck for you, it sucks for pretty much everybody, even the most “successful” humans among us. Filtering is the only way to get through it.

              From Dave Cohen’s last ever post in DeclineOfTheEmpire.com. If it sucks even for us apex predators living near the apex of industrial civilization, imagine how it must suck for other life forms. It’s why I can’t mourn the extinction of any species or the extinction of life itself.

            • Actually, there can be many high points as well. The wonder of nature, as a person takes a walk outside, for example. They joy of friendship, or of having a loving spouse. The beauty of music. The pleasure of having a pet, and training it to do tricks.

              Religion is partly about finding silver linings to clouds. A lot of people here have chosen to reject that approach. They can spend a lot of time looking at clouds.

            • Fast Eddy says:

              I don’t get this life sucks thing…. particularly when we have all had opportunities to better ourselves… I had government grants to attend school… always had enough to eat… how does that suck?

              When I had next to no cash living in one of the most expensive cities in the world … life did not suck…. it was a budget-level adventure…. In many ways those years were actually better than the years since when the adventure budget has increased…

              If you sit around moping and moaning about how everything sucks… then it will no doubt suck… it is the moaners and mopers that suck….

              So it ends badly…. in the meantime …. there are plenty of joys to be experienced…

              Of course there is the alternative… just end it all now.

            • Yorchichan says:

              My chemistry teacher used to say the laws of thermodynamics could be expressed as:

              1) You cannot win (= energy can be neither created nor destroyed);
              2) You always lose (= total entropy always increases);
              3) You have to play the game (= absolute zero cannot be reached).

              His summation could equally well describe the human condition:

              1) You cannot win = However much you have you always want MORE;
              2) Yo always lose = You always die;
              3) You have to play the game = However much life sucks you very much want to go on living.

        • Neil says:

          In the country of the blind the one eyed man is king

        • zenny says:

          Dan
          The people in my shop do not like advice even when they ask for it so I usually keep my mouth shut…They are shocked when off the top of my head I can ballpark family income and pension payout and claw back AKA means testing.

          It is a union shop and I have read all the contracts and most other contracts are public.
          I sure do not bring up the stuff we talk about…Last time I did that they made me a hat out of a pie plate.

    • zenny says:

      It may have something to do with the new workers they are importing or rather the ones that marry the first cousin and do not work… You need to see it to believe it

  2. Artleads says:

    GREEN FOLLY

    (Un) Affordability
    Energy for materials extraction and education and manufacture and maintenance implied
    Most of all, ugly and hard.

    • jupiviv says:

      I’d sooner live in a barrel. NEXT PLEASE!

    • Greg Machala says:

      Somebody has been watching too much Transformers! Lots of moving parts to break, parts get loose, hydraulics and gears need oil, parts will bend and wear then you get
      water leaks, wind leaks and rust problems. Glass breakage cost a fortune to fix, it is complex and expensive. I see only one advantage to conventional homes, you can move it. But, we already have motorhomes and mobile homes. It is another tech gadget for the wealthy wanna-be-greenies that drive Teslas and love the Transformer movies.

    • JesseJames says:

      Looks super reliable….sarc.
      Completely unreliable and not durable…would require replacement after a short time.
      Truth is, we are running out of things to invent. We can’t get past the gravity barrier, and we are rapidly running out of oil.
      This is a product of the foolish side of the green movement and overpopulation.

    • sodacup says:

      Ok, I get it. So basically they want to outsource home production to China along with everything else.

  3. SomeoneInAsia says:

    Someone claimed that wind and solar have been delivering 98 percent of all new US power capacity in January and February.

    https://community.oilprice.com/topic/1821-wind-solar-deliver-stunning-98-percent-of-new-us-power-capacity-in-january-february/

    What do you think?

    • doomphd says:

      if you like playing twenty questions with the help and eating food that tastes about the same as the equally nutritious wrapper, then subway is the place for you. goat food.

    • Christiana says:

      That doesn’t matter, they are substituted by Vapiano and other chains. Subway is far to expensive in the German market. The franchise scheme is deadly.

    • This is the way the economy as a dissipative structure works, unfortunately.

    • Sungr says:

      My daughter is a millenial. She has grown up with more fossil fueled products and activities than the baby boomers ever had.

    • sodacup says:

      I think the whole push for global free trade with a big mistake. We should have stuck to our gold backed currency and locally produced good. Even if we were poorer in a net energy use sense we would have had much happier fulfilling lives.

  4. adonis says:

    read this article carefully it explains what the IMF is planning for the world http://www.standard.net/Business/2018/04/24/The-IMF-exaggerated-debt-warning-but-for-a-good-cause.html 01,06,18

    • Greg Machala says:

      Every country is headed for chaos. All this crazy talk of planning is to give people the illusion that things are under control. Industrial civilization is a runaway train when it crashes its all over…there is no plan B. The only certainty is a massive population crash, how we get there is anyone’s guess.

    • Sungr says:

      ” Every country is headed for chaos.”

      I am looking at Venezuela & PR and thinking- Wow. These countries went down awfully quickly.

      If we look back at the 1900s ie Chicago Fire of 1876, San Francisco earthquake of 1906 etc we see that the societies of that time were able to completely rebuild these places with mostly horse labor in a fairly short period of time.

      Recent disasters are not being fixed quickly or completely ie Haiti, New Orleans,

    • theblondbeast says:

      Unfortunately the MMT’ers have a point that the debt doesn’t really matter. But mounting debt points to diminishing marginal returns. The U.S. and other monetary sovereign’s really can just print money until the point at which the rate of consumer inflation increases faster than the production of underlying resources (particularly oil) can ramp up.

      The language of fiscal austerity is the way we avoid seeing resource limits.

      • Sungr says:

        The US has an external debt of USD 20 Trillion.

        Even with near-zero interest rates, many foreigners have historically held US debt because of a number of reasons ie

        Politically stable nation
        Deep capital markets
        Rule of law
        Govt restrained in intervening in capital markets
        Well developed insurance industry
        Predominance of US military in world
        Globally dominant western financial sector

        These factors gave foreign & domestic investors confidence in US debt & equity markets.

        Now the above advantages are visibly deteriorating. Foreign and domestic holders of US debt will therefore be demanding higher interest rates to compensate.

        • theblondbeast says:

          That used to convince me, but https://www.thebalance.com/who-owns-the-u-s-national-debt-3306124

          A third of the debt is in-house accounting. another third is domestic owners (to whom the debt represents income) and less than a third (6 trillion) is owned by foreign interests.

          I suppose one potential problem is if foreign interests use dollars to purchase from other countries which accept dollars for payment. But even this creates demand for u.s. currency.

          I’ve been talked off the debt ledge. I think it just points to the fact that the credit impulse shows up as an increase in accounting debt – which demonstrates we’re reaching limits. The federal reserve can monetize the debt until such a point as the rate of growth of the underlying resource economy can’t grow fast enough, or at all, at which point it will collapse.

          Unfortunately it’s awfully totalitarian. As Steve Keen put it recently: If Hugo Chavez (or Marx) were alive today he wouldn’t need to seize the means of production. He would just print money and buy it.

          The Japanese central bank owns 75% of all domestic ETF’s.

          • The thing that a lot of people don’t realize is that quite a few government obligations are not treated as debt. People expect that Social Security, Medicare, unemployment insurance, and guarantees that the us government will guarantee bank balances up to $200,000 per account are funded guarantees. We also expect that nuclear accidents like Three Mile Island (and Fukushima) will be handled by the government.

            For the most part, these are funded by future tax revenue, and not considered debt. The major exception is that there is a little funding for Social Security that was collected in advance. This was, in fact, used for other purposes. There is a recorded debt, which you refer to as “a third of the debt is in-house accounting,” that relates to the funding that was spent for other purposes.

            • theblondbeast says:

              I’ve thought this way for a long time but recently I’ve been persuaded by the likes of Steve Keen and the MMT folks to reevaluate whether the U.S. and other monetary sovereign nations need to provision their actions through taxation or tariffs (a relic of the gold standard) or if they don’t merely money-finance (spend).

              I think functionally the limitation is on resources/inflation (inability to produce more goods and services) and the political pressures/resentments which blatant money-financing creates (i.e. bailing people out – giving money to some but not others).

              Three good papers showing some back-and-forth between MMT people from a contemporary economic standpoint are found here:

              Original: http://www.thomaspalley.com/docs/articles/macro_theory/mmt.pdf
              Response: http://www.levyinstitute.org/pubs/wp_778.pdf
              Rejoinder: http://www.thomaspalley.com/docs/articles/macro_theory/mmt_response_to_wray.pdf

              Private debt is a major problem, and it seems like increased government spending is the only solution to keeping aggregate demand (increase in GDP plus change in debt). Afterall, people need new dollars to pay off bank loans with interest and if private debt is tapped out the only place these will come from is the government – whether it comes slowly or quickly, directly or indirectly. I think high inflation happens when resources, particularly energy, can’t be increased or sustained as money supply increases.

              Tim Morgan had an interesting link to some meaningful distinctions between QE and money-financing (printing money).

              https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3060168

              – Are bonds purchased in the market (QE), or from the issuer (monetising)?
              – Is there a genuine intention to sell (QE), or is it permanent (monetising)?
              – Do purchased bonds pay interest (QE), or not (monetising)?
              – Are purchased bonds redeemable (QE), or perpetual (monetising)?
              – Are CB and treasury balance sheets kept separate (QE), or merged (monetising)?
              – Is it an autonomous CB operation (QE), or linked to fiscal policy (monetising)?
              – How much public debt has been bought? (the guideline apparently being 40%, more than this is monetising)?

              I think we will see money-financing of unfunded liabilities, great opposition to this, and ultimately see validated that it is resources per capita which is our hard limitation.

        • theblondbeast says:

          Additionally, China HAS to have surplus dollars in order to be a net exporter. There is no way around it. And the US has to expand currency to be a a net importer.

          • Sungr says:

            Good point.

          • Greg Machala says:

            And resources don’t expand?

            • theblondbeast says:

              This is the real question – how much “slack” is there in the resource market. I’ve heard somewhere that spare oil capacity is less than 1% of global daily demand. Money-financing (printing) in so far as it increases purchasing will grow the economy. If it does so faster than resource flows can increase, then we will see significant inflation. This is the end of the “goldilocks” window of oil prices.

              The government could also directly increase subsidies to oil and gas companies. The effect of this would be the same – it would increase prices in other non-oil sectors such as construction, heavy equipment, steel etc – which represents needing an increasing amount of societies total economic activity to direct toward the energy sector.

          • Good points! By the way, I liked the sorcerers’ apprentice analogy in the paper by Hannoun and Dittus. According to the paper:

            The monetary policies of the G7 countries resemble the action of the sorcerer’s apprentices who are no longer able to control the powers of the nether world whom they have called up by their spells, like in the famous ballad by Goethe. Who are these sorcerer’s apprentices? They are a trinity: the G7 central banks trapped in their own “whatever it takes” spiral; the G7 governments in their addiction to the debt driven growth model; and the global financial interests which, in connection with the mainstream financial media, encourage central banks and governments of the G7 to keep the party of lax macroeconomic policies going.

            Of course, there is no real fix for the spells cased by the sourcerer’s apprentices, even though the paper claims that there is.

  5. dolph says:

    The pikup truck in America is more than just a utility vehicle. That it is. But it is also a symbol, of working and middle class manlihood. To be sure, this applies to all cars and sports cars as well, but American men have a special love of the pickup truck. This love is found nowhere else in the world.

    He may just be an ordinary American guy, but by God he has his truck, his gun, votes Republican, and all the pansy city dwellers and foreigners can kiss his you know what.

    Symbols and culture matter. You people are academics and engineers. It’s why you can’t wrap your head around why everybody isn’t riding bicycles and driving Prii. They don’t want to. They will hang on to their trucks until the bitter end.

    • Yep, e.g. mandating ebikes + commuter trains combo only would prolong IC perhaps by centuries. Doable, yes, but not going to happen with this ~8B homoape virus in its current mutation..

      So, lets rather expect in the near-mid term few more wars, revolutions, attempted BAU extension via draconian authoritarian regimes before the IC structure finally disintegrates in full spectrum of functionality everywhere..

    • Dan says:

      I’m as red blooded american as the next guy (minus the voting part – I hate them all) but I suppose my rugged american individualism is expressed by refusing to be a slave to a bank or to a hunk of metal.

      • Nope.avi says:

        I assume you’re either independently wealthy, on welfare, or you live outside of civilization.

        To be a member of society is to be someone’s slave. Friends and family can be just as coercive as governments.

    • Sungr says:

      Most of these red-blooded PU-driving American men are over-weight weenies with soft little hands, oversized egos, and a reading list of zero books.

      And most of these big bad American PUs have never carried more cargo than groceries or a few bags of lawn fertilizer.

      It’s just a big show.

      • theblondbeast says:

        I find the american salaried class have more negativity against working class whites than any other form of class or racial discrimination.

      • Sungr says:

        Oh, I live on a rural place and drive a 1988 Toyota PU with 220k miles. It just turned 30 this year. This truck has hauled probably 400 tons of firewood.

      • Duncan Idaho says:

        “Most of these red-blooded PU-driving American men are over-weight weenies with soft little hands, oversized egos, and a reading list of zero books.”

        Bingo!
        We have a winner.
        This is from someone in rural Oregon, with more trucks (a 150 is a small vehicle here), than brains.

    • Sungr says:

      Here is an interesting video about how ISIS ran much of their military offense from the back of Toyota PUs.

      • theblondbeast says:

        A humvee is $200k, an MRAP can be $400k-900k. JMG had a good article about the Technical as a military strategy to look for as limits are reached. How long can we throw $900k MRAP’s at $5k used pickups with .50 BMG’s on ’em?

        • Duncan Idaho says:

          Errr– cost has never been a issue with the military—-
          In fact, the more you spend, the more you get.

          • theblondbeast says:

            Agreed. Spend away until high oil prices force out private consumers. That’s our limit at any given time.

      • zenny says:

        I call BS they can track a truck by the parts.

      • Pogo says:

        Its clear Japan should be sanctioned immediately!

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