The Bumpy Road Down, Part 4: Trends in Collapse

27 01 2018

IrvMillsIrv Mills has just published part 4 of his Bumpy Road Down series of articles…..

This time I’m going to look at some of the changes that will happen along the bumpy road down and the forces and trends that will lead to them. If you followed what I was saying in my last post, you’ll have realized that the bumpy road will be a matter of repeatedly getting slapped down as a result of going into overshoot—exceeding our limits, crashing, then recovering, only to get slapped again as we go into overshoot yet again.

Along the way, where people have a choice, they will choose to do a range of different things (some beneficial, others not so much), according to their circumstances and inclinations. Inertia is also an important factor—people resist change. And politicians are adept at “kicking the can down the road”—patching together the current system to keep it working for little while longer and letting the guy who gets elected next worry about the consequences.

Because the world will become a smaller place for most of us, we’ll feel less influence from other areas and in turn have less influence over them. There will be a lot more “dissensus”—people doing their own thing and letting other people do theirs. I expect this will lead to quite a variety of approaches, some that fail and some that do work to some extent. In the short run, of course, “working” means recovering from whatever disaster we are currently trying to cope with. But in the long run, the real challenge is learning to live within our limits and accept “just enough” rather than always striving for more. Trying a lot of different approaches to this will make it more likely that we find some that are successful.

Anyways—changes, forces and trend…and how they will work on the bumpy road down.

I’ve included the stepped or oscillating decline diagram from my last post here to make it easier to visualize what I’m talking about.

ENERGY DECLINE

Because I’m a “Peak Oil guy” and because energy is at the heart of the financial problems we’re facing, I’ll talk about energy first. As I said in a recent post:

“Despite all the optimistic talk about renewable energy, we are still dependent on fossil fuels for the great majority of our energy needs, and those needs are largely ones that cannot be met by anything other than fossil duels, especially oil. While it is true that fossil fuels are far from running out, the amount of surplus energy they deliver (the EROEI—energy returned on energy invested) has declined to the point where it no longer supports robust economic growth. Indeed, since the 1990s, real economic growth has largely stopped. What limited growth we are seeing is based on debt, rather than an abundance of surplus energy.”

It is my analysis that there is zero chance of implementing any alternative to fossil fuels remotely capable of sustaining “business as usual” in the remaining few years before a major economic crash happens and changes everything. So the first trend I’ll point to is a continued reliance on fossil fuels. Fuels of ever decreasing EROEI, which will increase the stress on the global economy and continue contribute to climate change and ocean acidification.

Those who are mainly concerned about the environmental effects of continuing to burn fossil fuels would have us stop using those fuels, whatever the cost. But it is clear to me that the cost of such a move would be a global economic depression different only in the details from the one I’ve been predicting. Lack of energy, excess of debt, environmental disaster—take your pick….

It has been interesting to watch the governments of Canada and the US take two different approaches to this over the last couple of years.

The American approach has been based on denial. Denial of climate change on the one hand, and denial of the fossil fuel depletion situation on the other. “Drill baby, drill!” is expected to solve the energy problem without causing an environmental problem. I don’t believe that either expectation will be borne out over the next few years.

Our Canadian government under Prime Minister Justin Trudeau has made quite a bit of political hay by acknowledging the reality of climate change and championing the Paris Climate Agreement in the international arena. Here at home, though, it is clear that Trudeau understands the role of oil in our economy and he has been quick to quietly reassure the oil companies that they have nothing to fear, approving two major pipeline projects to keep oil flowing from Alberta to the Pacific coast and, eventually, to Chinese markets.

Yes, Ottawa has set a starting price of $10 a tonne on carbon dioxide emissions in 2018, increasing to $50 a tonne by 2022. This is to be implemented by provincial governments who have until the end of the year to submit their own carbon pricing plans before a national price is imposed on those that don’t meet the federal standard. It will be interesting to see how this goes and if the federal government sticks to its plan. Canada is one of the most highly indebted nations in the world and I wouldn’t be surprised if our economy was one of the first to falter.

At any rate, sometime in the next few years the economy is going to fall apart (point “c” in the diagram). As I’ve said, this may well be initiated by volatility in oil prices as the current oil surplus situation comes to an end. This will lead to financial chaos that soon spreads to the rest of the economy.

On the face of it this isn’t too different from the traditional Peak Oil scenario—the collapse of industrial civilization caused by oil shortages and sharply rising oil prices. But as you might guess by now, this isn’t exactly what I think will happen.

In fact, I think that we’ll see an economic depression where the demand for oil drops more quickly than the natural decline rate of our oil supplies and the price falls even further than it did in the last few years. We won’t be using nearly so much oil as at present, so we will once again accumulate a surplus, and we’ll even leave some reserves of oil in the ground, at least initially. This will help drive a recovery after the depression bottoms out (point “e” in the diagram). Please note that I am talking about the remaining relatively high EROEI conventional oil here. Unconventional sources just don’t produce enough surplus energy to fuel a recovery.

But the demand for oil will be a lot less than it is today and this will have a very negative effect on oil companies. Some governments will subsidize the oil industry even more than they have traditionally, just to keep to it going in the face of low prices. Other governments will outright nationalize their oil industries to ensure oil keeps getting pumped out of the ground, even if it isn’t very profitable to do so. Bankruptcy of critical industries in general is going to be a problem during and after the crash. More on that in my next post.

During the upcoming crash and depression fossil fuel use may well decline enough to significantly reduce our releases of CO2 into the atmosphere—not enough perhaps to stop climate change, but enough to slow it down. As we continue down the bumpy road, though, our use of fossil fuels and the release of CO2 from burning them will taper off to essentially nothing, allowing the ecosphere to finally begin a slow recovery from the abuses of the industrial age.

The other trend involving fossil fuels, as we go further down the bumpy road, will be their declining availability as we gradually use them up. Eventually our energy consumption will be determined by local availability of renewable energy that can be accessed using a relatively low level of technology. Things like biomass (mainly firewood), falling water, wind, passive solar, maybe even tidal and wave energy. Since these sources vary in quantity from one locality to another, the level of energy use will vary as well. Where these sources are intermittent, the users will simply have to adapt to that intermittency.

No doubt some of my readers will be wondering why I don’t think high tech renewables like solar cells and large wind turbines will save the day. The list of reasons is a long one—difficulty raising capital in a contracting economy, low EROEI, intermittency of supply and difficulty of operating, maintaining and regularly replacing such equipment once fossil fuels are gone—to mention just a few.

Large scale storage of power to deal with intermittency will in the long run prove unfeasible. Certainly batteries aren’t going to do it. There are a few locations where pumped storage of water can be set up at a relatively low cost, but not enough to make a big difference. And on top of all that, I very much doubt that large electrical grids are feasible in the long run (and I spent half my life maintaining on one such grid).

THE FIRE INDUSTRIES

The next trend I can see is in the FIRE (financial, insurance and real estate) sector of the economy. During the growth phase of our economy over that last couple of centuries the FIRE industries embodied a wide range of organizational technologies that facilitated business, trade and growth. Unfortunately, because they were set up to support growth, they were unable to cope with the end of real growth late in the twentieth century. They have supported debt based growth for the last couple of decades as the only alternative that they could deal with. This led to the unprecedented amount of debt that we see in the world today. Much of this debt is quite risky and will likely lead to a wave of bankruptcies and defaults—the very crash I’ve been talking about.

The FIRE industries will be at the heart of that crash and will suffer horribly. Many, perhaps the majority, of the companies in that sector won’t survive. In today’s world they wield a great deal of political power. During the global financial crisis (GFC) in 2007-8 that power was enough to see them through largely unscathed. This is unlikely to be the case in the upcoming crash, creating a desperate need for their services and an opportunity to fill that need which will be another factor in the recovery after the crash bottoms out. But of course there is more than one way it can be done.

In the 3rd4th5th6th and 7th posts in my ” Collapse Step by Step” series, I dealt with the political realities of our modern world, which limit what can be done by democratic governments. I identified a political spectrum defined by those limits. At the left end of this spectrum we have Social Democratic societies, which still practice capitalism, but where those in power are concerned with the welfare of everyone within the society. At the right end we have Right Wing Capitalist societies where the ruling elite is concerned only with accumulating more wealth and power for itself.

Since the FIRE industries are crucial to the accumulation and distribution of wealth in our societies, the way they are rebuilt following the crash will be largely determined by the political goals of those doing the rebuilding.

At the left end of the spectrum there is much that can be done to regulate the FIRE industries and stop their excesses from leading immediately to further crises.

At the right end of the political spectrum the elite is so closely tied to the FIRE industries and so little concerned with the welfare of the general populace, that those industries will likely be rebuilt on a plan very similar to their current organization. A policy of “exterminism” is likely to be followed, where prosperity for the elite and an ever shrinking middle class is seen as the only goal and the poor are a burden to be abandoned or outright exterminated.(Thanks for Peter Frase, author of Four Futures—Life After Captialism for the term “exterminism”.)

In the case of either of these extremes, or anywhere along the spectrum between them, there are some common things I can see happening.

The whole FIRE sector depends on trust. In the last few decades (since the 1970s) we have switched from currencies based on precious metals to “fiat money” which is based on nothing but trust in the governments issuing it. This was done to accommodate growth fueled by abundant surplus energy and then to facilitate issuing ever more debt as the surplus energy supply declined. I don’t advocate going back to precious metals—what we need is a monetary system that can accommodate degrowth, of which a great deal lies in our future. Unfortunately we don’t yet know what such a system might look like.

It is clear, though, that the coming crash is going to shake our trust in the FIRE industries to its very roots. Since central banks will have been central to the monetary problems leading to the crash, they may well be set up as scapegoats for that crash and their relative lack of success in coping with it. People will be very suspicious after watching the FIRE industries fall apart during the crash and their lack of trust will force those industries to take some different approaches.

I think governments will take over the functions of central banks and stop charging themselves interest on the money they print. Yes, I know that printing money has often led to runaway inflation, but the conditions during the crash and its aftermath will be so profoundly deflationary that inflation will not likely be a problem.

The creation of debt will be viewed much less favourably and credit will be much harder to get. And of course this will make the crash and following depression that much worse. In response to this many areas will create local banks and currencies to provide the services that local businesses need to get moving again.

During the last couple of decades there has been a move to loosen regulations in the FIRE industries, to let single large entities become involved in investment banking, business and personal banking, insurance and real estate. Most such entities began as experts in one of those areas, but one has to question their expertise in the new areas they moved into. In any case they became “too big to fail” and their failure threatened the stability the whole FIRE sector. Following the GFC there was only minor tightening of regulations to discourage this sort of thing, but after the upcoming crash I suspect many governments, especially toward the left end of the political spectrum, will institute a major re-regulation of the FIRE industries and a splitting up of the few “too big to fail” companies who didn’t actually fail.

It is all very well to talk about business and even governments failing when their debt load becomes too great. But there is also a lot of personal debt that is, at this point, unlikely ever to get paid back. What does it mean, in this context, for a person to fail? What I carry as debt is an asset for someone else—probably the share holders of a bank. They are understandably reluctant to watch their assets evaporate, and I have to admit that there is a moral hazard involved in just letting people walk away from their debts. That feeling was so strong in the past that those who couldn’t pay their debts ended up in debtors’ prisons. Such punishment was eventually seen as futile and the practice was abandoned and personal bankruptcies were allowed.

One suspects that in the depression following the coming crash it will be necessary to declare a jubilee, forgiving large classes of personal debt. What might become of all the suddenly destitute people depends on where their country lies on the political spectrum. I wouldn’t rule out debtors prisons or work camps, the sort of modern slavery that is already gaining a foothold in the prison system of the United States.

If we were willing to give up growth as the sole purpose of our economic system, there are many changes that could be made to the FIRE industries that would allow them to provide the services needed by businesses and individuals without stimulating the unchecked growth that leads to collapse. I think we are unlikely to see this happen after the upcoming crash—we will be desperate for recovery and that will still mean growth at destructive levels.

I think the crash following that recovery will involve the food supply and still unchecked population growth and sadly a lot of people won’t make it through (more on this in my next post). Following that, it’s even possible that in some areas people may reach the conclusion that growth is the problem and quit sticking their heads up to get slapped down again. They’ll have to find a more sustainable way to live, but with it will come a less bumpy road forward.

AUTHORITARIANISM

In the aftermath of the next crash, I think we’ll see an increase in authoritarianism in an attempt to optimize the systems that failed during the crash—to make them work again and work more effectively. Free market laissez faire economics will be seen to have failed by many people. Others will hang tight, claiming that if they just keep doing yet again the same thing that failed before, it will finally work.

As is always the case with this sort of optimization, it will create a less resilient system, much more susceptible to subsequent crashes. And after those crashes governments will be reduced to such a small scale affair that authoritarianism won’t be so much of an issue.

Fortunately, beyond authoritarianism, there are some other trends that will lead to increased resilience and sustainability. We’ll take a look at those in my next post.

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More on money and the economy………

11 11 2017

Articles that, as far as I am concerned, confirm my desire to print local money are coming into my newsfeed thick and fast. This latest one, from the consciousness of sheep, claims the UK economy is as good as finished…….

I don’t agree with everything in it, but bear with me…..

This article also ties in with the looming oil problems. Of course, with the North Sea oil fields depleting in double digits figures, and the UK being as good as out of coal and gas, it’s no wonder an English website would be expressing concern. Make no mistake though, with Australia importing well over 90% of all its liquid fuel requirements, we are in no better shape, really….

“Inflation” says the author “results in the appearance of rising prices; but is actually the devaluation of money.” In my opinion, this is one of the biggest mistakes of economics. Money has no value. It’s for trading and spending. When we sold our house a couple of years ago, we were suddenly the owners of $400,000 instead of a house. Were we rich? I don’t think so…….  not until we spent it on a farm, a couple of utes, a bunch of tools, building materials, livestock, soil improvers, earthworks, concrete…… and now most of the money is gone, I feel richer than ever, because I have the things I need to face our uncertain future. No I’ll take that back, the future is certain, it will be bad…!

There are, however, other reasons for rising prices [than money printing].  And unlike monetary inflation, these are self-correcting.  For example, global oil prices have begun to break out of the $40-$60 “goldilocks” band in which consumers and energy companies can just about keep their heads above water.  Most economists believe this to be dangerously inflationary.  Indeed, almost all previous recessions are the result of monetary tightening (usually by raising interest rates) in response to an upward spike in oil prices.  Since oil is used to manufacture and/or transport every item that we buy, if the price of oil increases, then the price of everything else must increase too.

But the price of oil is not increasing in response to money printing.  Rather, it is the result of declining inventories which point to a global shortage of oil early in 2018 – traders are currently bidding up the price on futures contracts to guarantee access to sufficient oil to meet anticipated demand.  Since oil is considered “inelastic” (we have little choice but to pay for it) the assumption is that rising wholesale prices will be passed on to consumers, causing general inflation.  Frank Shostak from the Mises Institute challenges this assumption:

“Whether the asking price set by producers is going to be realized in the market place, however, hinges on whether or not consumers will accept those prices. Consumers dictate whether the price set by producers is ‘right’.  On this Mises wrote, ‘The consumers patronize those shops in which they can buy what they want at the cheapest price. Their buying and their abstention from buying decides who should own and run the plants and the farms. They determine precisely what should be produced, in what quality, and in what quantities.’

“If consumers don’t have the money to support the prices asked by producers then the prices asked cannot be realized.”

And the result is a recession/depression……. Shostak further argues that in this case:

“If the price of oil goes up and if people continue to use the same amount of oil as before, then this means that people are now forced to allocate more money for oil. If people’s money stock remains unchanged then this means that less money is available for other goods and services, all other things being equal. This of course implies that the average price of other goods and services must come off.”

Clearly there is a difference between something as ubiquitous as oil and those other goods and services that must fall in price unless more money is printed into existence.  The difference is this; each of us has a series of “non-discretionary” purchases that we have little or no choice but to make every month.  These include:

  • Rent/mortgage payments
  • Utility bills
  • Debt interest
  • Council tax
  • Food
  • Transport
  • Telephone/broadband

In addition, we make various “discretionary” purchases of goods and services that we want rather than need.  These include pretty much everything else that we buy, including:

  • TV subscriptions
  • Cinema
  • Eating out
  • Going to the pub
  • Music downloads/subscriptions
  • Electrical equipment
  • Clothes
  • Home furnishings

Oddly enough…..  I have nothing to do with that last list! Am I already out of discretionary spending power…?

If the cost of living rises without appropriate increases in people’s access to money, then we as individuals do what governments are trying to do to the economy as a whole – we cut back on everything that we consider discretionary.  In this way, the rising price of oil – and electricity -does not result in generalised inflation; it merely redistributes our spending across the economy. Just ask the retail sector how well it’s doing at the moment….. When I recently replaced my freezer for a bigger one, I went to Gumtree, not Hardly Normal, and the perfectly functioning small freezer will be sold to pay for it.

This is of course where ‘free money’ from the community, to only be spent in the community really comes in handy. It allows people to buy their essentials, when locally made, without spending the government money, thus allowing the real stuff to be spent on energy and taxes and other stuff created in the Matrix.

Make no mistake, one day soon, the ONLY economy left will be our local economies.

The articles continues…….

Another mistake made by economists and politicians is the belief that rising prices will generate political pressure for additional public spending and for wage increases across the economy.  Indeed, one of the greatest economic mysteries of our age is why apparently full employment has failed to translate into rising wages.  The obvious answer, of course, is that working people have traded employment for low wages.

There is good reason for this.  Since 2010, government attempts to run a budget surplus have sucked money out of the economy.  Public spending and social security payments (the two ways new government money enter the economy) have been savagely cut.  If government refuses to spend new money into the economy, only the banks can.  But since 2008 the banks have stubbornly refused to spend money into the “real economy,” preferring instead to pump up asset bubbles that add no new value to the wider economy.  Only those working people fortunate enough to get a foot on the housing ladder get to benefit from this; but even they can see the illusion – a house may have risen in price since it was bought… but it is still the same house; no commensurate additional value has been added.  The same is true for bubbles in bonds, shares, cryptocurrencies, luxury property, collectibles and fine art.

“Full employment”? The writer seems unaware of the manipulation of statistics regarding employment… don’t know if the UK suffers from the same problem, but here in Australia, anyone working just one hour a week is no longer considered unemployed! A remarkable nmber of people ‘on the dole’ actually work, they are merely underemployed, but not counted.

And the way governments have stopped spending in vain attempts to reach budget surpluses is truly baffling. As is of course the tsunami of privatizations going on all over the world. This wealth transfer is the biggest con the planet has ever seen…

Economically, people are responding to this in the only way they can.  The working poor – increasingly dependent upon in-work benefits and foodbanks – have not only cut their discretionary spending; they have been eating into their supposedly non-discretionary spending too.  As Jamie Doward in the Guardian reports:

“More than a third of people who earn less than the “real living wage” have reported regularly skipping meals to save money…  A poll carried out for the Living Wage Foundation also found that more than a third of people earning less than this had topped up their monthly income with a credit card or loan in the last year, while more than one in five reported using a payday loan to cover essentials. More than half – 55% – had declined a social invitation due to lack of money, and just over half had borrowed money from a friend or relative.”

As I’ve said in past posts on this issue, if you don’t have access to money, you simply have to borrow it. Credit card debt in Australia accounts for a full quarter of all private debt, and when you have to pay extortionary interest rates on those, it limits your spending power even more.

Things look grim in the UK it seems….

Cat Rutter Pooley in the Financial Times reports that:

“In-store sales of non-food items fell 2.9 per cent over the three months to October and 2.1 per cent in the past year — the worst performance since the BRC started compiling the data in January 2012. Clothing sales were particularly hard hit, according to the report, with unseasonably warm weather holding down purchases. Online sales growth was also lacklustre, at less than half the pace of the three- and 12-month averages.”

This latter point is particularly important because until now economists and politicians have peddled the myth that high street sales were falling because consumers were buying online.  The reality is that they are falling because – with the exception of food – we are not buying anymore.  The news of the fall in high street shopping comes just a day after the British Beer and Pub Association reported a massive fall in the sale of beer.  On the same day, energy company SSE threatened to shut down its energy supply business as a result of falling profits.  Back in December last year, we reported a similar shift in purchasing behaviour as people cut back on personal hygiene products.

You know things are bad when beer sales are falling…! If ever there was an argument to be made for self sufficiency, this does the job. I make 90% of the alcohol I drink (and it isn’t much, believe me… my wife gave me a bottle of Scotch when I left Queensland for good two years ago, and the bottle was only recently emptied..); and I am finally growing more and more of my own food, even selling excess produce I cannot eat fast enough myself…  Nicole Foss’ deflationary spiral sounds like it’s started, and while no one is saying so yet, I think it’s on in Australia too.

The one consolation is that when Britain’s poor have finally cut their spending to the bone, and a swathe of businesses have been forced into bankruptcy, it is the rich who are going to face the biggest losses.  The Positive Money campaign highlights the Bank of England/Treasury dilemma:

“The Bank of England faces its current predicament thanks to an ongoing failure to think beyond a limited, orthodox form of the central bank’s role. By keeping rates low, it risks inflating asset bubbles even further. But with incomes so weak, now is the wrong time to raise them.”

This lesson will only be learned retrospectively.  Once it becomes apparent that millions of British workers are not going to be repaying their debts, banks will crash.  Once it becomes apparent that British workers cannot provide the government with the tax income to pay back its borrowing, the bond market will crash.  Ironically, JPMorgan has already christened the coming collapse; as Joe Ciolli at Business Insider reported last month:

“JPMorgan has already coined a nickname for the next financial meltdown.  And while the firm isn’t sure exactly when the so-called Great Liquidity Crisis will strike, it figures that tensions will start to ratchet up in 2018…”

And I thought 2020 would be crunch time…….. how often can I be called an optimist..??

When the time comes, Britain will be particularly badly hit because our economy has been all but hollowed out.  The supposed “wealth” that makes up a large part of our GDP comes from the movement of precisely the asset classes that the coming Great Liquidity Crisis will render worthless.  The difference compared to 2008 is that this time around the banks are too big to save and individual central banks and governments are too small to save them.

Limits to growth, limits everywhere….. and nobody’s acknowledging it.

 





IT’S THE END OF THE WORLD — HOW DO YOU FEEL?

12 06 2016

Terry Root often goes to sleep at night wondering how she’ll be able to get up the next morning and do it all over again. Then the sun comes up and she forces herself out of bed. She might go for a run to release the pent-up anxiety. Sometimes she cries. Or she’ll commiserate with colleagues, sharing in and validating each other’s angst. What keeps Terry up at night aren’t the usual ailments; it’s not a tyrant boss or broken heart.

The diagnosis: global warming.

A senior fellow at Stanford’s Woods Institute for the Environment, Root has spent the past two decades unraveling the thread between climate change and the eventual mass extinctions of countless species of plants, animals — and, yes, humans. “That’s a tough, tough thing to cope with,” Root says in a weary, jagged voice. There’s more. When the gray-haired bird watcher shares her End of Days findings, she’s often met with personal attacks; naysayers hurl their disagreement and disdain, complete with name-calling and threats from politicians. But the absolute worst part of her job? We’re not listening. “It’s harder than hell to carry that,” says Root.

 

Armageddon aside for a moment, that an acclaimed scientist will say h-e-l-l to a reporter and use words like cope is a sign of changing times. Not only are we living on a warming planet but a progressively emotive one. It started with parents coddling their kids (no more advice to “just suck it up”), then it was emojis (punctuation isn’t enough) and now it’s climatologists tweeting “we’re f’d” and field researchers speaking up about climate depression — or even pretraumatic stress disorder.

There is a paradigm shift taking place in the field of science with the recognition that even the most stoic minds of the world need a way to process their doomsday findings. All of this is fueling a debate that’s raged since before Galileo and until recently landed on one central question: What place does human emotion have in scientific reasoning? But in 2015, there’s another layer that’s been schlepped into the controversial heap: What do you do when your job is to document the end of the world?

But what if the entire goddamned profession gets wiped out in a hurricane? Then what? There’s a growing sense of urgency as worsening environmental catastrophes play out before us. In the midst of what many in the science community — by “many,” we mean upward of 95 percent — are calling a planetary crisis, more researchers are finding that they can’t simply present their data in a vacuum, then go home at the end of the day and crack open a beer. “Scientists are going from these totally objective outsiders into being much more subjective and a part of the community,” says Faith Kearns, an outreach coordinator for the California Institute for Water Resources, which tries to solve drought-related challenges.

Indeed, the façade of total objectivity has deteriorated in recent years alongside intensifying environmental cataclysms. In 2012, Camille Parmesan, who shared a Nobel Prize with Al Gore in 2007 for her climate work, publicly announced her professional depression and frustration with the current political stalemate. Shortly after The Atlantic named Parmesan one of its 27 “Brave Thinkers,” alongside Steve Jobs and Barack Obama, for her efforts to save species, she temporarily left her university job in Texas for a reprieve across the pond. Then last summer, climatologist Jason Box’s tweet — “If even a small fraction of Arctic sea floor carbon is released to the atmosphere, we’re f’d” — went viral, provoking a media frenzy. The public relentlessly chastised him for a) making a definitive statement instead of dealing in the usual probabilities and b) expressing emotion.

And now there’s the website Is This How You Feel?, which publishes handwritten letters from climate scientists expressing their frustrations, fears and hopes. One professor writes, “It’s probably the first time I have ever been asked to say what I feel rather than what I think.” Another scrawls, “I feel exasperation and despair. … I feel vulnerable that by writing this letter I will expose myself to trolling and vitriol.” Joe Duggan, the mohawked Aussie with a nose ring and master’s degree in the growing field of science communications who manages the site, says he’s been shocked at how many responses he’s gotten in the mail: “There is a movement of scientists looking for new ways to connect; they’re emoting in ways they never have before,” he says.

 

Elizabeth Allison turns off the lights. She instructs her students to stack one vertebra on top of the next until their spines are straight and long. Then to focus on the rhythm of their breath. In. And out. In. And out. Acknowledge any feelings or sensations that arise, then let them go. After 15 minutes she slowly guides them back into the present. Feet and hands begin to stir. Eyelids slowly make their way to full attention.

OK, that’s it. See you all next week — and don’t forget your homework assignment is due. After all, this is graduate-level course PAR 6079.

So much for that centuries-old hidden curriculum. From professors like Allison taking students through a guided meditation after a discussion on retreating rainforests to scientists signing up for workshops on compassion and communication to support groups for climatologists, human emotion has wedged itself into every step of the scientific method. Marilyn Cornelius, a Stanford-trained researcher, has found the best way to explore creative solutions for the planet’s woes is to meld behavioral science, biomimicry, meditation and design thinking. Now she works as a consultant, taking energy experts on wilderness retreats and teaching lab coats to connect with themselves and nature. “I made a decision to work on behavior change,” Cornelius says, “because it’s a positive way to work on the climate problem.”

This isn’t just about managing the feelings of scientists, though. Kearns, from the California Institute for Water Resources, acknowledges how painful it can be to watch academics try to relate to everyday folks and has made it her mission to make these interactions less cringe-inducing. The soft-spoken brunette first began thinking about this impasse after some years back she hosted a community workshop on emerging “stay or go” science that weighs whether home owners can — and should — protect their property from increasingly frequent and ferocious wildfires. Her audience was a small northern California community that had recently faced that very dilemma. Fear, anger and helplessness pulsed through the room. “I started to feel their anxiety,” Kearns says. “Our research has an effect on people’s lives. My scientific training hadn’t prepared me to cope with the emotions that come with that.”

But there is still the camp that believes feelings erode credibility and breed bias. It’s the naturalistic fallacy, and it’s the difference between the is and the ought. The philosophy is that facts can’t substantiate value judgments. Science is perhaps the last frontier of neutrality, especially in today’s polarized society. As Philip Handler, former president of the National Academy of Sciences, once said, scientists “best serve public policy by living within the ethics of science, not those of politics.”

 

The seismic sentimental shift among scientists parallels an outpouring of feeling — and narcissism — across American society. Once-detached psychotherapists are hugging their clients, journalists have come to love the personal essay (in fact, it seems like everyone has a story to tell these days), even man-eating corporations are experimenting with emotional leadership. Or think of the impassioned protests around Black Lives Matter, the outrage at sexual abuse and the pleas against social inequality. “There’s been more space in the public realm for bringing up and dealing with emotional stuff, and that has cracked the shell of otherwise very removed scientists,” says Allison, a professor at the California Institute for Integral Studies. Then again, maybe climatologists are more cunning than we give them credit for, and they’re simply taking a page out of their opponents’ playbook.

Indeed, emotions are a powerful tool for those who know how to use them. Which is why those leading the climate-change charge aren’t looking to labs anymore. Instead, eager students are following Cornelius’s path, pursuing studies in contemplative environmentalism or transformational ecology, which looks to shrinks, money and Facebook to protect the planet. With the future of everything at stake, what has traditionally separated science from sentiment is a lot less defined — and perhaps even irrelevant.

But emotions are less predictable than facts and figures. Root remembers giving a talk once at the University of Utah. Afterward a few students came up to ask questions; one young man had tears in his eyes. “Is it really this bad?” he pleaded. Root told him it’s worse. He went on to become an activist and was sent to prison for one of his illegal protests. Root has always felt responsible.

“I’d always thought that facts and the truth would win out; then I realized that wasn’t the case,” Root says.





This is bigger…….

17 01 2016

That was big………  but this is bigger.

Whilst I admit to not hearing it for some time, the MSM has been spreading its usual nonsense in the form of “the fundamentals” [of the economy] are spot on, there’s nothing to worry about. Which I’ve been calling for years as crap, and now there’s a chart that explains everything regarding why I feel this way.

chart says it all

(Richard Koo: The ‘struggle between markets and central banks has only just begun’, Business Insider)

Why is the economy barely growing after seven years of zero rates and easy money? Why are wages and incomes sagging when stock and bond prices have gone through the roof? Why are stocks experiencing such extreme volatility when the Fed increased rates by a mere quarter of a percent?

It’s the policy, stupid. And here’s the chart that explains exactly what the policy is.

What this chart clearly shows is that the monumental increase in money printing had almost zero effect on lending, nor did it trigger the credit expansion the Fed were hoping for…… In other words, the Fed’s insane pump-priming of the economy experiment (aka– QE) both failed to stimulate growth and put the economy back on the so called ‘path to recovery’ we’ve been told was on, but everyone else has been saying for years never happened. For all intents and purposes, the policy was a complete flop.

Mind you, had it worked, I think we would have seen massive inflation. Basically, the fundamentals went AWOL way back in 2008. And no one wants to admit to it.lifestyle_banksy-500x332

The latest news from the US is that Walmart are closing 269 stores, which will probably leave some small towns with nowhere to buy anything,  and thousands of people out of work. If you need signs that economic collapse is now well underway, look no further than that little curler…..

The upside is that we might even see CO2 emissions starting to fall.





Underneath the Propaganda, the Economy Is In BAD Shape …

8 06 2015

Joe Hockey recently stated something along the lines that all of us talking up a recession now had egg on our collective faces.  The economy’s doing just fine hey Joe…….  you’re still a millionaire, after all.  Well…  things are not that rosy at all.

There’s an economic indicator called ‘the velocity of money’.  It’s a measure, apparently, of how fast money circulates through the economy, and the faster it goes, the more consumption happens, the faster the economy grows.  And it seems, not all is boding well on that front.

3 years ago, the velocity of money – this all important economic indicator – was lower than during the Great Depression.  And things have gotten even worse since since then …

These charts from http://www.washingtonsblog.com/2015/06/an-important-economic-indicator-money-velocity-crashes-far-worse-than-during-the-great-depression.html.  Now while they apply to the US economy, I expect ours will be just as impacted as theirs……..

Money

Here’s the money velocity right before the Great Depression hit:

Money 1

Here’s the money velocity from the darkest point during the Great Depression:

Money 2

Here’s the money velocity before the 2007-2008 crash started:

Money 4

And here’s the money velocity from the most recent data from 2014:

Money 3

Bottom line: The velocity of money has fallen much farther – and to much lower ultimate levels – than during the Great Depression.

Ouch





Debt Inequality and Crisis

25 05 2015

When the economic history of our epoch is written, three key phenomena will feature: a period of tranquility giving way suddenly to crisis, rising inequality, and rising private debt. Using my model of Minsky’s Financial Instability Hypothesis, I show that these three phenomena are all related. There is a direct link between rising debt, rising inequality, and the crisis itself. The key to reducing inequality and ending economic stagnation is to reduce private debt through “Quantitative Easing for the Public” or a “Modern Debt Jubilee”. This is the keynote speech Steve Keen gave to the #IEEP conference in Pula, Croatia on May 23rd 2015

Now I still find economics mind numbing…  but Steve Keen’s 3D modelling and his live modelling during this talk is fascinating, even if the algorithms he uses are not for the faint hearted.





Code of Silence

7 05 2015

George-Monbiot-LEvery now and again, when he’s not spruiking nuclear power, I get the strong impression George Monbiot ‘gets it’.  I definitely get this impression in this, his latest effort which I hope no one will mind my republishing in full, because it’s such a wonderful read.  It’s of course all about the looming UK election, but what he says here applies everywhere, not least Australia.  Enjoy anyway…….

Almost all the issues worth debating are left unmentioned in this election.

By George Monbiot, published in the Guardian 6th May 2015

Political coverage is never more trivial or evanescent than during an election. Where we might hope for enlightenment about the issues on which we will vote, we find gossip about the habits and style of political leaders, an obsession with statistically meaningless shifts in opinion polls and empty speculation about outcomes. (All this is now compounded by the birth of a royal baby, which means that our heads must simultaneously be dunked in a vat of sycophantic slobber). Anyone would think that the media didn’t want us to understand the choices confronting us.

While analysis of the issues dividing the political parties is often weak, coverage of those they have collectively overlooked is almost non-existent. The Conservatives, Labour, the Liberal Democrats and even the SNP might claim to be at each other’s throats, but they have often reached consensus about which issues are worthy of debate. This article will list a few of the omissions.

The first is so obvious that it should feature in every political discussion: the corrupt and broken system under which we will vote. The argument I’ve heard several Labour activists use – “vote for us because it’s the best we can hope for under first-past-the-post” – would carry more weight if Labour had any plans to change the system.

Where are the furious arguments about the UK’s unreformed political funding, that allows billionaires and corporations to buy the politics they want? Where is the debate about the use and abuse of royal prerogative by successive prime ministers? Where is there even a mention of the democratic black hole at the heart of Britain, into which hopes for financial and fiscal reform are sucked: the Corporation of the City of London, whose illegitimate powers pre-date the Magna Carta?

Here’s a fact with which politicians should be assailed every day: the poor in this country pay more tax than the rich. If you didn’t know this – and most people don’t* – it’s because you’ve been trained not to know it through relentless efforts by the corporate media. It distracts us by fixating on income tax, one of the few sources of revenue that’s unequivocally progressive. But this accounts for just 27% of total taxation. Overall, the richest tenth pay 35% of their income in tax, while the poorest tenth pay 43%, largely because of the regressive nature of VAT and council tax. The Equality Trust found that 96% of respondents to its survey would like a more progressive system. But where is the major party mobilising this desire, or even explaining the current injustice?

A comprehensive failure to tax land and property is a policy shared by the three major English parties, mansion tax notwithstanding. None of them seems to mind that this failure helps to replace the entrepreneurial society they claim to support with an economy based on rent and patrimonial capital. None of them seems to mind that their elaborate fiscal ringfencing of land and buildings clashes with their professed belief that capital should be used productively.

Nor will any of them mount an effective challenge to kleptoremuneration: executives siphoning off wealth they had no role in creating. None seek to modify a limited liability regime so generous that it allowed the multi-millionaire authors of the financial crisis, such as Fred Goodwin and Matt Ridley, to walk away from the pain they helped to inflict without forfeiting a penny.

Even these issues are trivial by comparison to the unacknowledged cloud that hangs over our politics: the impossibility of infinite growth on a finite planet. All major parties and media outlets are committed to never-ending economic growth, and use GDP as the primary measure of human progress. Even to question this is to place yourself outside the frame of rational political debate.

To service this impossible dream, we must work relentlessly, often in jobs that deliver no social utility and cause great harm. Who in politics is brave enough to propose that we work less and enjoy life more? Who will challenge working conditions characterised by ridiculous quotas and impossible demands, or reform a social security regime more draconian and intrusive than day release from prison? Who is prepared to wonder aloud what all this striving and punishment is for?

And how about some acknowledgement of the epidemic of loneliness, or the shocking rise in conditions such as self-harm, eating disorders, depression, performance anxiety and social phobia? Evidently, these are not fit and proper subjects for political discourse, which creates the impression that those who suffer them are not fit and proper electors.

How about some arguments over the loss of public space? Or a debate about what’s happening to children, confined as never before within four walls, both at school and at home? How about some recognition of the radical changes in transport demand, that are likely, in the age of peak car and peak plane, to render redundant the new roads and airports to which all the large parties are committed? Forget it.

The national and global collapse of biodiversity, the horrifying rate of soil loss, the conflict between aspirations to minimise climate change and maximise the production of fossil fuels: none of these are put before voters as issues of significant difference. All major parties tacitly agree to carry on as before.

Politicians will not break these silences voluntarily. They are enforced by a narrow and retentive public discourse, dominated by the corporate media and the BBC, that ignores or stifles new ideas, grovels to the elite and ostracises the excluded, keeping this nation in a state of arrested development.

After this election, we need to think again; to find new means of pushing neglected issues onto the political agenda. We might try to discover why the social media have so far mostly failed to fulfil their democratising promise. We might seek new ways of building political communities, using models as diverse as Podemos and evangelical Christianity. We might experiment with some of the Latin American techniques that have helped to transform politics from the bottom up. However we do it, we should never again permit democracy to be reduced to so narrow a choice.

http://www.monbiot.com

* 68% of respondents to the Equality Trust’s Survey believed that households in the highest 10% income group pay more of their income in tax than households in the lowest 10% income group.