Increased Violence Reflects an Energy Problem

Why are we seeing so much violence recently? One explanation is that people are sympathizing with those in the Minneapolis area who are upset at the death of George Floyd. They believe that a white cop used excessive force in subduing Floyd, leading to his death.

I believe that there is a much deeper story involved. As I wrote in my recent post, Understanding Our Pandemic – Economy Predicament, the problem we are facing is too many people relative to resources, particularly energy resources. This leads to a condition sometimes referred to as “overshoot and collapse.” The economy grows for a while, may stabilize for a time, and then heads in a downward direction, essentially because energy consumption per capita falls too low.

Strangely enough, this energy crisis looks like a crisis of affordability. The young and the poor, especially, cannot afford to buy goods and services that they need, such as a home in which to raise their children and a vehicle to drive. Trying to do so leaves them with excessive debt. If the affordability problem changes for the worse, the young and the poor are likely to protest. In fact, these protests may become violent. 

The pandemic tends to make the affordability problem worse for minorities and young people because they are disproportionately affected by job losses associated with lockdowns. In many cases, the poor catch COVID-19 more frequently because they live and/or work in crowded conditions where the disease spreads easily. In the US, blacks seem to be especially hard hit, both by COVID-19 and through the loss of jobs. These issues, plus the availability of guns, makes the situation particularly explosive in the US.

Let me explain these issues further.

[1] Energy is required for all aspects of the economy.

Energy is required by governments. Energy is required to operate police cars. Energy is required to build schools and to operate their heating and lighting. Energy is needed to build and maintain roads. Tax revenue represents available funds to buy energy products and goods and services made with energy products.

Energy is needed for any type of business. Operating a computer requires electricity, which is a form of energy. Heating or cooling a building requires energy. Growing food requires solar energy from the sun; liquid fuel is used to operate farm machinery and trucks that transport food to the locations where it is sold. Human energy is used for some of these processes. For example, human energy is used to operate computers and farm machinery. Human energy is sometimes used to pick the crops, as well.

Wages paid by governments and businesses indirectly go to buy energy products of many kinds. Food is, of course, an energy product. The heat to cook or bake the food is also an energy product. Metals of all kinds are made using energy products, and lumber is cut and transported using energy products. With sufficient wages, it is possible to buy or rent a home, and to purchase or lease an automobile.

Interest rates indirectly reflect the portion of goods and services produced by energy products that can be transferred to parts of the system that depend on interest earnings. For example, banks, insurance companies and those on pensions depend on interest earnings. If interest rates are high, benefits to pensioners can easily be paid and insurance companies can charge low rates for their products, because their interest earnings will help offset claim costs.

Interest rates are now about as low as they can go, indicating a likely shortage of energy for funding these interest rates. The last time interest rates were close to current levels was during the Great Depression of the 1930s.

Figure 1. Ten-year and three-month US Treasury interest rates, in chart made by FRED.

[2] When there is not enough energy to go around, the result can be low commodity prices, low wages and layoffs.

This is not an intuitive result. Most people assume (low energy = high prices), but this is the opposite of what actually happens. The problem is that the amount workers can afford to pay for finished goods and services needs to be high enough to make production of the commodities used in making the finished products profitable. When affordability falls too low, the system tends to collapse.

We are really dealing with a two-sided problem. The prices of commodities such as oil, wholesale electricity, steel, copper and food tend to fluctuate widely. Consumers need these prices to be low, in order for the price of finished goods made with these commodities to be affordable; producers need the prices of these commodities to rise ever-higher, to cover the cost of deeper wells and more batteries, to try to partially offset the intermittency of solar and wind electricity.

Most people assume that the situation will be resolved in the direction of commodity prices rising ever higher. In fact, commodity prices did rise higher, until mid 2008. Then, something snapped; commodity prices have been falling ever-lower since mid 2008. In fact, ever-lower commodity prices have been a world-wide problem, causing huge problems for countries trying to support their economies with export revenues based on commodity production.

Figure 2. CRB Commodity Price Index from 1995 to June 2, 2020. Chart prepared by Trading Economics. Composition is 39% energy, 41% agriculture, 7% precious metals and 13% industrial metals.

Even before the lockdowns, low commodity prices were leading to low wages of those working in commodity industries around the world. These low prices also led to low tax revenue, and this low tax revenue led to an inability of governments to afford the services that citizens expect, such as bus service and subsidized prices for certain essential goods/services. For example, South Africa (an exporter of coal and minerals) was experiencing public protests in September 2019, for reasons such as these. Chile is a major exporter of copper and lithium. Low prices of those commodities led to violent protests in 2019 for similar reasons.

Now, in 2020, lockdowns have led to even lower commodity prices. At times, farmers have been plowing their crops under. Oil companies are laying off workers. The trend toward lower commodity prices had been occurring for a long time; the recent drop in prices was “the straw that broke the camel’s back.” If prices stay this low, there is a danger of falling production of commodities that we depend on, including food, metals, electricity, and oil. Businesses producing these items will fail, and governments with falling tax revenue will be unable to support them.

[3] Historical energy consumption data shows that violence often accompanies periods when energy production is not growing fast enough to meet the needs of the growing population.

Figure 3 shows average annual growth in world energy consumption, for 10-year periods:

Figure 3. Average growth in energy consumption for 10 year periods, based on Vaclav Smil estimates from Energy Transitions: History, Requirements and Prospects (Appendix) together with BP Statistical Data for 1965 and subsequent.

Economic growth encompasses both population growth and rising standards of living. Figure 4 below takes the same information used in Figure 3 and divides it into (a) the portion underlying population growth, and (b) the portion of the energy supply growth available for improved standards of living. During most periods, increased population absorbs over half of increased energy consumption.

Figure 4. Figure similar to Figure 3, except that energy devoted to population growth and growth in living standards are separated. A circle is also added showing the recent growth in energy is primarily the result of China’s temporary growth in coal supplies.

There are three dips in the Living Standards portion of Figure 4. The first one came in the 10 years ended 1860, just before the US Civil War. Most of us would say that was a period of violence.

The second one occurred in the 10 years ended 1930. This is the period when the Great Depression began. It came between World War I and World War II. This was another violent period of our history.

The third dip came in the 10-year period ended 2000. This was not a particularly violent period; instead, it reflects the collapse of the central government of the Soviet Union, leaving the member republics to continue on their own. There was a huge loss of demand (really, affordability) on the part of countries that were part of the Soviet Union or depended on the Soviet Union.

Figure 5. Chart showing the fall in Eastern Europe’s materials production, after the collapse of the central government of the Soviet Union in 1991.

[4] The world is facing a situation in which total energy consumption seems likely to drop by 5% per year, or perhaps more.

If we look back at Figure 3, we see that even in very “bad” times economically, energy consumption was rising. In fact, in one 10-year period, the average increase was more than 5% per year.

If the world economy is reaching a point in which we consumers, in the aggregate, cannot afford the goods and services made with commodities, unless commodity prices are very low, we will likely experience a huge drop in energy consumption. I don’t know exactly how much the annual change will be, but energy consumption growth and GDP growth tend to move together. We might guess that GDP growth is shifting to 5% GDP annual shrinkage, and energy consumption will be shrinking by a similar percentage.

Clearly, shrinkage of 5% per year would be far worse than the world economy has experienced in the last 200 years. In fact, for the 10-year periods shown in Figure 3, there has never been a reduction in energy consumption. Even if I am wrong and the shrinkage in energy consumption is “only” 2% per year, this would be far worse than the experience over any 10-year period. In fact, during the Great Recession, world energy consumption only shrank in one year (2009) and then by 1.4%.

History doesn’t give us much guidance regarding what impact a dramatic reduction in energy consumption would have on the economy, except that population reduction would likely be part of the change that takes place. If half or more of energy consumption growth goes toward rising population (Figure 4), then a shrinkage of energy consumption seems likely to reduce world population.

[5] What the world is really facing is a competition regarding which parts of the economy can stay, and which will need to be eliminated, if there is not enough energy to go around. It should not be surprising if this competition often leads to violence.

As I indicated in Section [1], all parts of the economy depend on energy. If there is not enough, some parts must shrink back. The big question is, “Which parts?”

(a) Do governments, and organizations that bind governments together, collapse? If countries are doing poorly, they will not want to contribute to the World Trade Organization, the United Nations or the European Union. Governments, such as the government of Saudi Arabia, could be overthrown, or may simply stop operating. In fact, any government, when it faces insurmountable problems, could simply stop operating and leave its functions to lower levels of government, such as states, provinces, or cities.

(b) Do pension plans stop operating? Are pensioners left “out in the cold”? How about Social Security recipients?

(c) Can international trade be kept operating? It is a big consumer of energy. Also, competition with low-wage countries tends to keep wages in developed nations low. Without international trade, many imported goods (including imported medicines) become unavailable.

(d) Which companies will collapse, leaving bond holders and stockholders with $0? People who formerly had jobs with these companies will also find themselves without jobs.

(e) If the world economy cannot support as many people as before, which ones will be left out? Is it people in rich countries who find themselves without jobs? Is it people who find themselves without imported medicines? Is it the ones who catch COVID-19? Or is it mostly citizens of very poor countries, whose income will fall so low that starvation becomes a concern?

[6] The violent demonstrations represent an effort to try to push the problems related to the shortfall in energy, and the goods and services that energy can provide, away from the protest groups, toward other segments of the economy.

In an ideal world:

(a) Jobs that pay well would be available to all.

(b) Governments would be able to afford to provide a wide range of services to all, including free health care for all and reimbursement for time off from work for being sick. They would also be able to provide adequate pensions for the elderly and low cost public transit.

(c) Police would treat all citizens well. No group would be so poor that a life of crime would seem to be a solution.

As indicated in Section [2], back in 2019, before COVID-19 hit, protests were already starting because of low commodity prices and the indirect impacts of low commodity prices. One reason why governments were so eager to adopt shutdowns is the fact that when people were required to stay inside because of COVID-19, the problem of protests could be stopped.

It should be no surprise, then, that the protests came back, once the lockdowns have ended. There are now more people out of work and more people who are concerned about not having full healthcare costs reimbursed. Social distancing requirements are making it more difficult for businesses to operate profitably, indirectly leading to fewer available jobs.

[7] Violent protests seem to push problems fueled by an inadequate supply of affordable energy toward (a) governments and (b) insurance companies.

In some cases, insurance companies will pay for damages caused by protesters. Eventually, costs could become too great for insurance companies. Most policies have exclusions for “acts of war.” If protests escalate, this exclusion might become applicable.

Governments of all kinds are already being stressed by shutdowns because when citizens are not working, there is less tax revenue. If, in addition, governments have been paying COVID-19 related costs, this creates an even bigger budget mismatch. Governments find themselves less and less able to pay their everyday expenses, such as hiring teachers, policemen, and firemen. All of these issues tend to push city governments toward bankruptcy and more layoffs.

[8] Dark skinned people living in America tend to be Vitamin D deficient, making them more prone to getting severe cases of COVID-19. Vitamin supplements may be an inexpensive way of reducing the severity of the COVID-19 epidemic and thus lessening its diversion of energy resources.

There are a number of reports out that suggest that having adequate Vitamin D from sunlight strengthens the immune system and helps reduce the mortality of COVID-19. Adequate Vitamin C is also helpful for the immune system for people in general, not just those with dark skin.

Dark skinned people are adapted to living near the equator. If they live in the United States or Europe, their bodies make less Vitamin D from the slanted rays available in those parts of the world than they would living near the equator. As a result, studies show that Vitamin D deficiency is more common in African Americans than other Americans.

Recent data shows that the COVID-19 mortality rate for black Americans is 2.4 times that of white Americans. COVID-19 hospitalization rates are no doubt higher as well. Encouraging Americans with dark skin to take Vitamin D supplements would seem to be at least a partial solution to the problem of greater disease severity for Blacks. Vitamin C supplements, or more fresh fruit, might be helpful for all people, not just those with low Vitamin D levels.

If the COVID-19 impact can be lessened in a very inexpensive way, this would seem to be helpful for the economy in general. High-cost solutions simply divert available resources toward fighting COVID-19, making the overall resource shortfall for the rest of the economy worse.

[9] Much more equal wages would seem to be a solution for wage disparity, but this doesn’t bring the wages of low earning workers up enough, in practice. 

There are a huge number of low-earning workers in many countries around the world. In order to increase commodity prices enough to make them profitable for producers, we really need wages in all countries to be much higher. For example, wages in Africa and in India need to be much higher, so that people in these parts of the world can afford goods such as cars, air conditioning and vacation travel. There is no way this can be done. Furthermore, such a change would add pollution and climate change issues.

There is a fundamental “not enough to go around” problem that we do not have an answer for. Historically, when there hasn’t been enough to go around, the attempted solution was fighting wars over what was available. In a way, the violence seen in cities around the globe is a new version of this violence. Governments of various kinds may ultimately be casualties of these uprisings. Remaining lower-level governments will be left with the problem of starting over again, issuing new currency and trying to make new alliances. In total, the new economy will be very different; it will probably bear little resemblance to today’s world economy.

 

 

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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2,617 Responses to Increased Violence Reflects an Energy Problem

  1. info says:

    During the Bronze Age collapse. Men formed into gangs and took to the seas and brought war to CIvilizations all around the Mediterranean. Known as “Sea Peoples” only Egypt was able to beat them off. While other Civilizations had to keep fighting wave after wave of warriors until they ran out of resources.

    • Very interesting (https://en.wikipedia.org/wiki/Late_Bronze_Age_collapse)
      I’d noticed that the Egyptian “New Kingdom” had lost control of Palestine, about that time (something that gave me more pause about biblical fundamentalism: if the Isrealites had crossed the Gulf of Suez, & gone into Palestine, they would have been in more Egyptian territory — the books of Exodus & Joshua are heavily contradicted by history & archeology).

      • info says:

        They crossed earlier.

      • Robert Firth says:

        The whole Exodus story is a fiction. Supposedly, two million people wandered around the desert for 40 years, and left not a single mark of their passage. And what did they eat? Manna, of course: that is how religions get discredited, they try to prop up one silly myth by another, sillier myth, and so on. And what did they drink? Water from a magic spring. Just how long would it take for two million people to get a daily cup of water from such a spring? Say 20 people at a time, and five seconds each. That’s 500,000 seconds, or almost 6 days, queueing day and night. Does not compute.

        No, the Exodus story was written much later, at a time when the north eastern boundary of Egypt was the “River of Egypt” (Wadi El Arish) , and by someone who thought that had always been the case. The story is pure invention.

        • The version I have heard is that a much smaller number of people were involved. There were probably some elements of truth to it, but the story was improved upon as it was told.

          • Robert Firth says:

            Gail, there is probably some truth in the notion that some slaves escaped Egypt during the upheaval wrought by the Sea Peoples, but it is vanishingly unlikely they were the ancestors of the Hebrews. Perhaps the story got passed on and appropriated. At this remove in time, hard to tell. The Egyptians did not practice slavery as a society, but prisoners of war were certainly expected to work for their keep, which is near enough the same thing. And if they got free, naturally they would head for the hills, just as slaves did in the antebellum USA.

            • Tim Groves says:

              Robert, I find your lack of faith in Biblical literalism disturbing. 🙂

              I find it interesting that when the Hebrews left Egypt, they took so much gold with them that they were able to make a golden calf. So I wondered if they were really slaves at all or if they came by that wealth honestly.

        • info says:

          Of course if you don’t believe its possible. It’s inconceivable. Otherwise look at this:
          http://www.tektonics.org/af/exoduslogistics.php

          Its very possible.

          • There was a lot of intermarrying with people in the area, adding to the numbers of the Jews.

            • Also, the number of years between generations was more than what would be assume by looking at the genealogies in the Bible. They skip over many people in the list.

          • Robert Firth says:

            Thank you, info, for a most interesting reference. However, I fear it supports my thesis that religions prop up silly tales with sillier ones. Generation after generation, all having 10 or more children, at a time when child mortality was 30% to 50%. And among slaves, no doubt higher still. Again, does not compute.

            • Dennis L. says:

              I respectfully disagree. Joseph Campbell relates the importance of stories in peoples across all civilizations, from my perspective they are simple parables that work 80% of the time which is good enough. Campbell put it well when he said, “Myths are public dreams, dreams are private myths.” Calling them silly tales is condescending to those who believe and having a hypothesis that they prop up religions is pretentious.

              Secular humanism has from my perspective been a failure expounded by an elite which exhibits a hubris in considerable excess of their demonstrated abilities. Much of what they preach is their vision of an imaginary world which leads to cogitative dissonance when compared with reality as generally experienced. Where as a myth is an allegorical version of the world, secular humanism seems to me to be a literal interpretation of of a vision of a group or philosopher, Marx comes to mind. It was tried, it hasn’t yet worked.

              That ought to cover it, top of the evening to you in Malta.

              Dennis L.

            • Tim Groves says:

              Denis, what you are saying sounds very reasonable to me.

              Many tales will sound silly to people who don’t share the cultural perspective of the people who created and persevered the tales, because the stories usually don’t make sense unless people have been programmed to find them sensible, plausible or at least useful.

              Having said that, it is remarkable how many ancient stories still delight audiences today despite the disappearances of cultures that created them and regardless of whether they are believed to be true in a literal sense.

              On a related note, I think a lot of modern narratives that are part of our current official collective reality are silly tales—such as the nine-11 tale, the globbly wobbly tale and the coronavirus tale. But I recognize that those tales are told and shared and widely believed for a purpose—in order to get public support for or at least acquiescence in national or international policies that they might otherwise strongly object to.

            • Liberal religions do not take “oral traditions” or even the more modern texts, literally. Even these were written many years after events supposedly took place. They look instead for insights on things like, “How should we treat our neighbors?” Religious services are more a platform for looking at things today. They are also social gathering places, especially for older women. Years ago, they were a good place for young people to meet a spouse. Now, with fewer young people attending churches, this is less the case.

              I met my husband at a church. My only brother met his wife at a church.

        • Duncan Idaho says:

          Bad Bronze and Iron Age Fiction.
          Plus, really violent.
          We really need something better for our fictions and superstitions.

          • These are the stories people told their children. We can choose to believe them or not.

          • Xabier says:

            On the other hand, all the evidence points to the rather violent nature of life itself,an endless cycle of hunting, killing and consumption, and of human beings in particular -so perhaps it’s far more more realistic than fantasies of brotherly love and peace.

            • Duncan Idaho says:

              I agree, it’s just so poorly written (by numerous societies).
              Superstitious writing can be good.
              The Iliad, or anything by someone like Homer, is a treat to read.
              We need better superstitions and even better ignorance .
              Let’s keep the mind open.

            • Tim Groves says:

              The tales in the Bible must have suffered greatly in translation. When it was compiled, the scribes may have edited most of the best bits out of it and left all the boring “begat” “and “the Lord said unto” bits, In. The stories may have been a lot more entertaining in the original to native listeners.

            • once writing was established and came into common use, (as the next stage on from pictograms) seems to me that the first useful thing they did with it was to count what they had.
              As it eems to have been roughly in parallel with early agriculture

              the next logical use would be to write down all the legends of how we came to be.

              even the dimmest nomad would recognise the significance of the umbilical cord, figuring out that there had to be a ‘start’ to it all— a historical chain which could only have been the work of ‘god’.

              once that was written down, it becomes ‘holy writ’ after a few generations, and can’t be challenged. (heresy)

              All this was at the end of the last ice age, so ‘great flood’ events would have been common, and associated climate changes. Great floods are likely to have been folk memories from 000s of years previously. The sahara dried out causing movements of people–always toward alternative water sources.. Another folk memory. Memories are almost always of good times past, (garden of eden?)

              Stuff gets written down, , but once the writers are dead, later readers read it as contemporary material. One legend gets overlaid with another

          • info says:

            The Ancient World was very violent. And yes it features the Bronze and Iron Age. You look down on our Ancestors and we are somehow the enlightened ones.

        • Dennis L. says:

          Robert, hmmm,

          It was a very good try, it gave rise to a tribe that found its promised land, lost its nation and say 2,000 years returned as a nation, it gave rise to more Nobel laureates than any other group, a certain nation in the 1940’s tried to exterminate them, a bunch escaped, ended up in a northwestern desert town built from nothing and boom!

          Very powerful story, it has endured. Written by God to keep his people together? Heard a better one lately that endured that long? It needs to refer to a tribe that is extant.

          As for the water, well, maybe it was a big spring. A bit of humor, sometimes we take ourselves too seriously.

          Dennis L.

          • Robert Firth says:

            Thank you, Dennis, for a most interesting and courteous response. I can only answer that I agree with almost all you say, but I regard it as a tribute to the enduring power of myth, which is indeed to be celebrated. As in Egypt they still celebrate the Divine Alexander (Iskander dhu l-qarnayn) after 2300 years. I also believe that myths may be false to fact, but capture an inner truth of the human psyche. You have probably noticed that I have been greatly influenced by Carl Gustav Jung.

        • doomphd says:

          made a great movie, if you believe the Red Sea is made of gelatin.

          • Robert Firth says:

            I think the view of the “demystifiers” is that the body of water in question was not the Red Sea, but the River of Egypt, which is quite shallow and can indeed be made dry by a wind from the right quarter. Rather a stretch, in my opinion, not least because it could never have drowned Pharaoh’s chariots. Another memory: our school chaplain once said he imagined a little fish, swimming through the Red Sea, suddenly finding itself swimming through that Cecil B de Mille wall, and finding itself in air. Poor little fish!

            • Slow Paul says:

              Just as history is written be the victors, maybe biblical stories were written by the survivors of past harsh times. Telling tales might have been a part of what made some groups survive and others not.

            • beidawei says:

              Fundamentalists: Moses really did part the Red Sea
              Modernists: Maybe it was really the Sea of Reeds, or there was a really strong wind…
              Postmodernists: Moses never existed, the whole story is a myth
              Millennials: confuse Moses with Noah

            • doomphd says:

              interesting. another critic is the bottom of most seas and even rivers can be covered in fine silt and clay, which would be hard to walk through when wet and would probably “bog down” the pursuing chariots.

    • Kim says:

      Medieval Europe found that one great drawback of the widespread use of mercenaries was that after they were paid off and had nowhere else to fight they would hang around the former employer’s lands doing pretty much what they wished. Which wasn’t good. But there was so much war there was usually someone available to employ them.

      • Robert Firth says:

        Agreed. Machiavelli had a very poor opinion of mercenaries, and (as usual) he was right.

      • Xabier says:

        Once they;d left off stomping behind a plough or wielding a scythe why would they wish to go back – unless rich from plunder and able to employ others to do the dirty work?

        • Robert Firth says:

          Good point, Xavier. But in fact many mercenaries were gently born, and recruited followers from their vassals and lower class neighbours. As Sir John Hawkwood (1323 to 1394), who terrorised much of Northern Italy. A fascinating man, knighted for his services to rapine and pillage, who adopted the arms “argent, on a chevron sable three escallops of the field”, also an interesting device to those who know blazonry.

  2. Dan says:

    I am not that political but I wonder if this jobs report today is not manipulated. Seems strange

    • Harry McGibbs says:

      1,877,000 new claims for unemployment insurance (versus the 1,775 ,000 expected in a survey of economists) making for a total in excess of 42,000,000 since early March is still pretty glum.

      “Even as states reopen, claims in the millions are an indicator that the economic pain of the COVID-19 crisis is still acute,” said Daniel Zhao, senior economist at job placement site Glassdoor.

      “Continuing claims, which provide a clearer picture of how many Americans remain unemployed, totaled 21.5 million, a gain of 649,000 over the past week, also worse than Wall Street expected.”

      https://www.cnbc.com/2020/06/04/weekly-jobless-claims.html

      • The headline in the WSJ is “US Unemployment Rate Fell to 13.3% in May.”

        The article you linked says:

        A day before the jobless claims report, ADP’s private payrolls report on Wednesday showed a decrease of 2.76 million positions in May. While that remains far higher than anything the U.S. economy saw in the pre-coronavirus era, it was well off Wall Street expectations of an 8.75 million decline.

        That led Moody’s Analytics economist Mark Zandi to declare that “the Covid-19 recession is over.” Moody’s assists ADP in putting together the monthly private payrolls report. “That would make it the shortest recession in history,” Zandi said. “It will very likely be among the most severe.”

        The stock market is up 952 points, and WTI oil is up to 39.01.

        The problem is past, at least in some people’s view.

    • Duncan Idaho says:

      Hint:
      One possibility is that many companies brought back employees to qualify for the PPP (Payroll Protection Plan).
      But, I have been wrong before.

      • People brought back workers, not realizing that with social distancing requirements and many frightened customers, the number of actual sales will not support this level of employment.

        • Dennis L. says:

          Gail,

          As a businessman/woman workers are brought back because they are valuable even if “only” restaurant workers. Skilled workers are very difficult to replace, a rumor is Mayo has had a great many “mature” nurses retire – they are the ones who pass their experience and clinic culture on to the next group. It takes years to put teams together, if they are gone the remaining capital is worth essentially nothing.
          I always invested in my people, it was always a winning bet even if they did not work out, the remaining employees knew I valued them – a story if you will.

          Dennis L.

        • Dan says:

          Yes but could the numbers be manipulated. I know the U.s is not China but… something seems fishy

  3. Kim says:

    In terms of reaching thermodynamic an resource limits, the plainest issue of violence is whether we can afford it. With the balance of power implications of that.

    The warship Bellerophon, a 74 gun 3rd rate wooden warship of the British navy, was constructed using a minimum of 2000 oak trees at least 100 years old. That kind of consumption can go on only as long as the forests last.

    Meanwhile, the mayor’s of certain cities say that they are going to make swingeing cuts in their police budgets and redistribute the funds to community or social projects.

    It is in budgets (of pethaps already broke cities) that we will see the clearest signs of trends in the resources/violence dynamic.

    • One rating puts New York City, Chicago, Philadelphia, Honolulu and San Francisco as the most broke cities. These cities would seem to be at risk of having to reduce their budgets.

      The metro areas with the highest percentage of low income people, pre-COVID, were listed as follows:

      1. McAllen-Edinburg-Mission, Texas
      2. Las Cruces, New Mexico
      3. Laredo, Texas
      4. Brownsville-Harlingen, Texas
      5. Valdosta, Georgia

      These metro areas don’t line up with the most violence.

      • brian says:

        seems to me that the cities with the highest rates of unemployment amongst youth would be the cities experiencing the most violence.

        • It could be. They haven’t had as much in the way of high school and college classes to keep them busy, either. They want something to do. They would like to be around friends of their own age. Protests are a way of doing this.

    • Robert Firth says:

      The original Bellerophon was the son of Poseidon, so the name of the ship was quite appropriate. She distinguished herself in three great naval battles: the Glorious First of June (1794), the Battle of the Nile (1798) and finally Trafalgar (1805). She later received Napoleon’s surrender after the Campaign of the Hundred Days (July 1815).

  4. Harry McGibbs says:

    “The energy industry’s bet that a petrochemicals boom would support decades of oil and gas sales growth is on shaky ground as an already saturated plastic market is hit by a coronavirus demand shock.”

    https://uk.finance.yahoo.com/news/pandemic-exposes-cracks-oil-majors-070630029.html

    • Harry McGibbs says:

      “The global liquefied natural gas (LNG) industry is set to face its first seasonal demand contraction since 2012, Wood Mackenzie said on Tuesday.”

      https://www.kallanishenergy.com/2020/06/03/global-lng-demand-heads-to-1st-contraction-in-8-years/

      • According to the article,

        The consulting company believes China’s LNG demand in Q2 will grow 12% to 15 Mt, as the giant shifts focus to industrial demand recovery.

        With the rest of the world still in recession, it will be difficult for China to shift have enough demand to increase its LNG use.

    • Back when shale oil was booming in North Dakota, I heard executives talking about the plan they had to get rid of the short chains that they didn’t have room in pipelines for. They would make plastics out of it.

      Maybe we can use more plastic in take out containers from restaurants, now that they can’t serve as many inside!

  5. Pintada says:

    A man walks up to you on the street and introduces himself as Napoleon Bonaparte. What do you do?

    A. Put your head down and mumble, “Nice to meet you, I’m late for a meeting.”
    B. Try to cure him by quoting statistics.

    Obviously, you do A (or some variation) and move on. He is insane/delusional.

    • Robert Firth says:

      C: You say “Bonjour, mon Empereur”. The man is a “trans” character, and refusing to address him as such is now officially “hate speech”. And anyway, it’s a lot less absurd than a man with a Y chromosome demanding to be referred to as “she”.

    • Malcopian says:

      D. You say, ‘Ah! Obviously you’ve changed your name by deed poll. How much did that cost?’

      ‘No’, he replies. ‘I am the great-great-great-great-great grandson of the great man himself and my parents named me after him!’

      • Malcopian says:

        E. ‘Really. So you’ve met my friend Jacob von Floghume, then?’

      • beidawei says:

        “I’ve always wanted to visit St. Helena!”

        • Malcopian says:

          “I’ve always wanted to visit St. Helena!”

          Now why would you want to cheat on your poor wife?

        • neil says:

          I have. A weird little place.

        • Norman Pagett says:

          Napoleon complex

          • Robert Firth says:

            I once worked for a boss who was born in Corsica, and who was much the same size as Napoleon, not to mention temperament. But he taught me a lot about technical management, which served me in good stead later.

            • no experience is ever wasted

            • Malcopian says:

              ‘I once worked for a boss who was born in Corsica, and who was much the same size as Napoleon, not to mention temperament. But he taught me a lot about technical management, which served me in good stead later.’

              You’re old enough to have known Napoleon well enough to have compared him physically to your boss, and yet you were open enough to learn from him. Bravo!

  6. JMS says:

    https://www.statnews.com/2020/06/04/lancet-retracts-major-covid-19-paper-that-raised-safety-concerns-about-malaria-drugs/

    The Lancet, one of the world’s top medical journals, on Thursday retracted an influential study that raised alarms about the safety of the experimental Covid-19 treatments chloroquine and hydroxychloroquine amid scrutiny of the data underlying the paper.
    Just over an hour later, the New England Journal of Medicine retracted a separate study, focused on blood pressure medications in Covid-19, that relied on data from the same company.
    The retractions came at the request of the authors of the studies, published last month, who were not directly involved with the data collection and sources, the journals said.
    “We can no longer vouch for the veracity of the primary data sources,” Mandeep Mehra of Brigham and Women’s Hospital, Frank Ruschitzka of University Hospital Zurich, and Amit Patel of University of Utah said in a statement issued by the Lancet. “Due to this unfortunate development, the authors request that the paper be retracted.”

    • Robert Firth says:

      “We can no longer vouch for the veracity of the primary data sources,”

      No, you could *never* vouch for the veracity of the primary data sources, but you hoped to get away with it anyway. And why has the editor of one of the world’s top medical journals, now exposed four times as a perpetrator of hoaxes, not resigned?

  7. Countdownbegins says:


    Human coloring is not the issue. Our prejudice is explained so simply by Dr. Seuss in the story about the sneetches, and most people tend to think and relate this simplistically. To rise above this level and see the forest requires use of our critical thinking skills, which also entails becoming a grown up. Grown ups arguing with children is quite pointless. Now back to limits to growth….

  8. John says:

    CTG,

    What do you think is going on? Im from the UK and lots of the major companies are getting silently bailed out, once again by central banks money printing.

    Im aware that the conventional oil peaked in 2005 and since 2008 the whole system has been propped up by massive money printing debt. I remember in 2019 something big was brewing in the global economy and here we are it seems like the central banks just remedied it with massive money printing like always.

    How long can they keep this ponzi financial monetary system going with debt? I find it strange how a global pandemic arrives as soon we were hearing alarm bells going about a coming global recession in 2019. How long can the central banks keep this system propped up with massive money printing from a implosion?

    • CTG says:

      The world is self organizing and complex. Complexity always fail though it has resilience is some way. The endpoint is known and confirmed that it will collapse. Civilization is never permanent. History has shown time and again. Humans never learn. Our world, in the 2 decades has taken a lot hits and are normally wounded. We don’t know the exact time when it will end. In ancient times, it ends when the capital city is abandoned and the people moved away. Right now, it is worldwide and we are nor going to Mars.

      Like Enron, WorldCom and Arthur Andersen, the employees are still buying company stocks right up the day the company ended. In hindsight, people asked why the employees are doing it right up till the day it went bankrupt? They also asked are the employees stupid? No, they do not have access to previledge information. They were in the dark. There may be some signs but normalcy bias was strong. Suddenly one day, they went to work and realized that the company did not exist anymore.

      In order to preserve their status and cushy jobs, the top people will lie. 100% as certain as the sun will rise tomorrow. As critical thinking is gone, due to myriad of reasons, no one bothers to look for signs of impending doom. Those who are so unfortunate to be endowed with critical thinking are cast away and stigmatized. Happened before in history. Nothing new.

      So yes, the signs are there. How long before the financial system collapse (no money coming out from ATM or hyperinflation), the supply chain breaks or the “pandemic” comes back with a vengeance? No one can answer. Just ask the employees of Enron who bought company stocks (just before the collapse) because his supervisor said that Enron has a very bright future the supervisor was just as duped as his employee. If you can read between the lines and catch my drift…..

      Humanity is toast.

      • CTG says:

        *mortally wounded

      • Right. We don’t know how long the system can be propped up. Quite a bit of the new debt is propping up companies that don’t really have a future. Also, giving wages to people who work for companies that don’t really have a future.

  9. frankly step-by-step says:

    Nothing is for nothing part 1

    The world is upside down. Not only since the Corona crisis. Enormous efforts are required every day to maintain this condition.
    Those who practice yoga and practice standing upside down, in yoga the exercise is called Shirshasana, know what I mean. The smallest gust of wind, the slightest carelessness, Kawumm … – landed rudely on the yoga mat.
    But practice makes perfect. The Kawumm …, in the figurative sense of the crash, occurs less and less. You have learned to keep your attention.
    But not even a master of yoga would come up with the idea of ​​keeping this state endless. The exercise actually only serves to change the perspective. Serves as a training of the mind.
    But afterwards it is always necessary to return; that is: to get up again.
      
    But our world is always upside down. The condition is chronic. Even more, standing upside down is now considered a natural state.
    But since he is not, there are a lot of people who feel it. They feel increasingly uncomfortable, feel overwhelmed, insecure people look for the mistake in themselves. Some despair so much that they brutally elude standing upside down.
    But anyone who manages to stand on their own two feet will shortly thereafter feel excluded. Is no longer understood. Is an outsider.
    The majority, however, tries to come to an arrangement. Believe the elites, the politicians, the economists, leading media representatives and the company bosses who assure that the situation is completely normal.
    And even the critical voices (yes, there are), who feel the fallacy, deal endlessly with the statements of the elites.

    Hi! Don’t switch off now. Hold on.
     
    Now it’s about getting everything back on its feet. With the help of the Bible.
    The Bible?
    Yes, hard to believe.

    It goes back in time. Quite far. Roughly three thousand years. To the old testament. To the book Genesis. To Abraham and Melchizedek to Genesis chapter 14, verse 18-20.

    https://www.biblegateway.com/passage/?search=genesis+14&version=CSB

    It follows that Melchesedik is the high priest of God. Abraham, as a blessed one, is a believer in God. And as such, he hands Melchizedek the tithe of the loot.
                              
    If you want to know where the spoils of war came from, just read the verses in front of it.

    Genesis Chap. 14, verses 18-20 is, to my knowledge, the first mention of tithe in the Bible.
    Since there is no previous text, it can be assumed that tithing was handed down orally before the Bible. And thus must be accepted as the first obligation of a believer in God towards God.
    Except for the commandment in Genesis chapter 8, verse 4, “However, living flesh, still connected to its blood, you should not eat.” A commandment that I think is related to the tithing.

    There is also further evidence of voluntary tithing, which affects Jacob. Mentioned in Genesis chapter 28, verses 20-22.

    I now come from the first obligation of a believer in God to put this obligation in writing, and thus to the law.

    As the law, tithe is first mentioned in Leviticus, chapter 27, verses 32-34, in the third book of Moses.

    The most interesting thing about this text is the precise definition of the procedure for the survey. Since it is mentioned that animals are not allowed to be exchanged, there were probably people who circumvented the law and wanted to circumvent it even before it was written down.
    Even more interesting is the mention that a twenty percent surcharge was due when paying with money.
    So those who paid with money had to give up twelve percent a year.

    The tithe collectors were the temple servants, the Levites, who in turn received ten percent of the tithe for their work and again had to give ten percent of this tithe to the priesthood (Aaron and Aaron’s descendants).

    The question that now arises: what actually happened to all the remaining eighty-eight to ninety percent of the cattle that were brought in, all the fruit and vegetables, all the money?

    The answer to that is really startling. There was a festival at the tithing site. A huge festival where everyone was allowed to eat it all. Always with the proviso of thanking God for his benevolence.

    Benevolence? That is the question now. What should tithing be if people got a good portion of it back, according to God’s will? Why this strange construct?

    Perhaps this thought will help.
    The priesthood, as well as the Levites, were in the former God state (I am the Lord your God), the elite of the state and could therefore decide on the direction in which the community should steer.
    So the Levites and priests were at the same time something like the central banker and government in one.

    In any case, if you follow his mention in the Bible, the tithe shows a logical development. And is always the focal point of the action. It is not for nothing that the prophets repeatedly urge them to keep God’s laws. Which suggests that tithing, as God wished, usually did not work. Which was probably also due to the kings that God had appointed at the people’s request (they wanted a king, like all the peoples around them).
    OK, you can have it, God said, but be aware that the tithe is no longer due to me, but to the king.

    So once again the question at the end of the first part of the post “Nothing is for nothing”: why did God so urgently and so emphatically demand tithing?

    • Very Far Frank says:

      Christ…

    • frankly step-by-step says:

      No ideas…?
      OK. Then continue with part 2.

      Nothing is for nothing – part 2

      Actually, the answer to the question asked: why is tithing? Easy to answer. But believe me, the answer is difficult to get into your head.
      We are all shaped by what surrounds us, what we have been taught and what we have our own experiences with. And none of us can say that he has no experience in dealing with money.
      Money moves us. Don’t leave us alone.
      Johann Wolfgang von Goethe writes in Faust: Everything is pressing for gold, everything depends on gold. Oh poor!
      The whole Faust of Goethe is permeated by the money topic. In the second part also of the impending state bankruptcy. And of course caught by the moral struggle of men between Mephisto and God.
      We all know the fight. One way or another.

      Many of the problems that mankind currently has could be solved with a completely different kind of money. And as God promises in the Bible texts, we would then have him on our side. With rich harvests and peace in the country. And with justice between people.

      That’s why I’m a fan of God, even more a supporter of God.

      One does not have to be a believer for the following solution. Reason is enough.

      It was in 1994 when I noticed a book in a three-hour nightly broadcast on public radio, the author (Peter Kafka) of which brought up thoughts that really upset me at the time.
      I then started reading. Thought. Read more. And at some point I knew that’s it.

      Another book, written by Margrit Kennedy, was published in Germany in 1995 and, in my opinion, is the best work I know as an introduction.
      And for most readers here, not to be scoffed at, it also appeared in English.

      Attention: 58 pages
      https://www.kennedy-bibliothek.info/cx-content/

      findable:
      https://www.kennedy-bibliothek.info/home/

      Unfortunately, Margrit Kennedy is no longer alive. But her CV does exist in Wikipedia (engl.).

      https://en.wikipedia.org/wiki/Margrit_Kennedy

      The book – Interest and Inflation free Money – suggests that central bankers should charge an annual fee for all cash and any deposits in simple bank accounts. She speaks of about 5-6%.
      So it differs from God’s demand, who demanded 12% when the tithing was paid.
      The difference is serious, but not nearly as big as that between zero and minus five to minus six percent. Whereby I would rather be for the divine specification.
      Result of this central bank operation: the basis of the interest calculation would change.
      The basis for calculating the interest is then not 100% but only 94-95%. With the divine application only 88%.
      And that would have tremendous effects. It would be a matter of huge amounts of money worldwide, which would be distributed differently every year.
      The losers in this central bank action would be today’s winners, the money elites.
      Which also explains that apart from central bankers (who have been working intensively on it since the 2008/9 financial crisis), hardly anyone knows about it. And the few who report about it and get attention face the violent headwind.

      It is not an easy matter. But once understood, a real eye opener.

      Margrit Kennedy referred to the work of Silvio Gesell.

      His CV also at the English-language Wikipedia.
      Suggestion: Read the “Opinions of Gesell”.

      https://en.wikipedia.org/wiki/Silvio_Gesell

      And now also the link to his main work.
      Silvio Gesell (1929)
      https://www.silvio-gesell.de/the-natural-economic-order.html

      This is reading material for many, many hours.

      And imagine; in this system it is even possible to shrink without breaking it down. What is unthinkable in our current system. Keyword: system crash.
      System crash because everyone is involved in the game, all pay tribute to the same system that has to grow at all costs so as not to cause any distortions as we are currently experiencing.
      Individual countries have been hit countless times in the past. State bankruptcies without end.

      Only this time, because everyone is intertwined, it will ultimately affect everyone. Unless we humans in democratic countries stop this madness. And get back on our feet.
      A huge number of the current problems could then dissolve into nothing and create space for a new way of thinking. A way of thinking that also respects the limits of growth and resources.

      I don’t want to hide the fact that I doubt that this will happen. If the Vatican and the Vatican Bank do not abide by God’s laws, then what can be expected from other, more secular institutions?
      But at least I wanted to inform you about the alternative. Our media haven’t done it so far or I’ve overlooked it … it can be.

    • Tim Groves says:

      I fear we are rapidly moving from Shirshasana (Headstand pose) to Savasana (Corpse pose).

      • frankly step-by-step says:

        Nice try.

      • frankly step-by-step says:

        And now that I think about it again, you may be right. The path from the headstand (shirshasana) probably leads at least through a barely perceptible resting position (savasana). Then to switch balanced to Tadsana (the upright position).
        Everything else is for acrobats.
        You can imagine for yourself what this means for the change from the upside down to the upright world.

    • Norman Pagett says:

      god didn’t demand tithing—the priests did.

      Originally it would have been the means by which genuine priests doled out money to the destitute. Later it got corrupted into church income.

      Because ‘holy buildings’ are expensive, and like every other human enterprise must constantly expand.
      https://www.historytoday.com/archive/tithes-country-life

      Why dyou think the televangelists keep demanding money from suckers? Look at cathedrals, and compare them to the average dwelling at the time they were built. Now they have megachurches and learjets

      In 000s of years nothing has changed. They prey on people’s fears and ignorance

      • Holy buildings also provide jobs for workers. They were part of the economic infrastructure of the Middle Ages. Population was expanding too much for everyone to become farmers; farms would have to be cut into tiny pieces. Work on the cathedrals could start and stop as needed, if workers were needed for agriculture or wars.

        All of these systems are self-organizing. The megachurches sometimes have recreational activities for children of members. They seem to fill a need that governments are not filling.

        There are indeed a handful of televangelists with high incomes. There are also a lot of young people who have finished seminary and find themselves with a high level of debt. Today’s wages for pastors/priests are not high enough for young pastors to pay back their debt, without a spouse having a second income to help support the family.

        • Norman Pagett says:

          country parishes in uk used to have what was called a ‘glebe’ which was a parcel of land set aside to provide a living for the priest

          wages for building cathedrals came out of contributions paid by the laity–which made them essentially job creation schemes on the same basis we have today

          i was under the impression that ordinary labourers gave thier time free to keep in god’s good books come reckoning time. —only skilled craftsmen got a decent wage

          As to unemployed newly ordained priests, they seem to fall into the same category as other jobs that can only flourish in a ‘surplus’ society—art historians, avant garde musicians (my window cleaner has a degree in that) and so on. If there are too many of them, they have to find alternative real work.
          In UK many priests were often the later sons of aristocracy, which also gave them some means of support, or at least social standing

      • frankly step-by-step says:

        “god didn’t demand tithing — the priests did.”
        No. If you say so, you have not read the text. Certainly not the Bible texts. The third book of Moses (Leviticus) chapter 27 – God spoke to Moses – describes in detail the requirements of God and the implementing regulations.
        And in Deuteronomy chapter 12 the procedure is again described. And also written about tithing consumption.
        The prophets also report that there were repeated arguments about tithing and it follows from my text.
        If it had only been about the care of the priesthood, the population would certainly have liked to give up two percent of the income instead of the 1% that the Levites and the priesthood received from tithing.
        So the argument doesn’t work.

        I will simply post part 1 again and immediately afterwards part 2 – and hope that Gail Tverberg will unlock him promptly, then it will become clear what tithing really was about.

        • I have enough trouble with Jwitnesses quoting chapter and verse at me on my doorstep—Though I’ve feeling a bit unsaved lately
          Do they do emergency visits when I feel a mortal sin coming on? Or after I’ve committed one?. Cant even do that these days. ( and maintain social distance as well)
          (your real nick isn’t doorstep by doorstep is it?)

          I believe in biblical times, salt was a major form of currency—I can see why. Pinches could never be enough to go with it all.

          The last thing we want to get into here is bible regulations..I might enjoy some of them till i got arrested.

          Then the Jwitnesses would consign me to the outer darkness (provided there were 4 witnesses), where I would find myself in good company I daresay.

          • frankly step-by-step says:

            There are several books of human wisdom. The Bible is one of them. And no, I’m not the one who runs from door to door and tries to win followers.
            I’m more of a loner.
            But since 1994, when I first came into contact with Silvio Gesell’s theory, I had a lot of time to think.
            And at some point I noticed contact with tithing.
            In Germany, after experience 33-45, it is difficult to talk about topics such as interest and changes in the monetary system. To prevent this, I quoted the bible. Not even Angela Merkel’s Christian party can object to this.

            I hope my statement calms you down.

      • Robert Firth says:

        Norman, tithes turned out not to be nearly enough. The mediaeval church invented two other money spinners. One was the sale of indulgences, which thanks to Luther we all remember. the other was the “cullagium”, a tax paid by clergy who kept concubines or catamites, which in those days seemed to be almost all of them. Sigh. As usual, power tends to corrupt.

        • Today, people talk about taxing the rich, with these fund being used to help the poor.

          I think of indulgences as a very clever voluntary tax on the rich. They could give some of their wealth to the church (which in turn could hire nuns, priests, and cathedral builders) as a way to buy their way into heaven. Self-Organizing systems work in very strange ways!

          • Robert Firth says:

            Gail, I think one of the best ways to help the poor is to train them in a job that makes luxury goods (yachts, for instance). That way, the rich get value for money, and the poor get the whole sum paid. Put the government into the picture, and by the time the tax gatherers, the accountants, the politicians, the bureaucrats, and the social workers have all taken their cut, there isn’t much left for the poor.

  10. Dennis L. says:

    I made a note under Gail regarding the money spent to maintain a workforce. A team is very difficult to assemble, getting two teams to collaborate and work for a common goal is even more difficult. Supposedly a certain European country in the 1940’s has sufficient uranium in total to sustain fission, but two different teams hoarded theirs and both failed, sometimes failure has a desirable outcome.

    When we come out of this we will need groups of people who can function together, easier said than done. We will also need intact nations, while some seem to see collapse as a great adventure it has a strong possibility to be not nearly as much fun as anticipated. Those who are thinking they will be king of the hill might want to read early soviet history, the “inventors” all died, one as far away as Mexico City, Papa Joe came along.

    So we spend some paper money, try and keep things going and hopefully make it to the other side. You need teams, John, easier to take what you have than start anew.

    Dennis L.

    • Robert Firth says:

      Dennis, when that nuclear programme was handed over to the Reichsforschungsrat in 1942, the work was divided among no fewer than nine institutes, all doing what research institutes usually do with government money: spend it on their own agendas. Nothing useful came of it. Perhaps the least unsuccessful part of the whole effort was the heavy water facility built in Vernork in occupied Norway. Norwegian resistance fighters, aided by allied bombing raids, disposed of it in 1943, but it did work.

    • The way the system seems to work now is government funding is given for projects deemed “worthwhile.” Promotions within universities are given for research deemed “worthwhile.” Politicians come up with a huge number of goals deemed worthwhile: renewable energy, energy efficiency, racial equality, sustainability, . . .

      The projects are broken down into small enough pieces that no one suspects that the goals are really not attainable in the form they are laid out. The part of the economy aimed at profits of businesses (including the profits of farmers) moves in one direction. The part of the economy driven by government sponsored theories of the day moves in a different direction.

      Actually, we cannot get to a sustainable solution, though either the business driven approach or the wishful thinking of politicians and educators because resources per capita are too low.

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