What is this ‘Crisis’ of Modernity?

22 01 2017

But why is the economy failing to generate prosperity as in earlier decades?  Is it mainly down to Greenspan and Bernanke’s monetary excesses?  Certainly, the latter has contributed to our contemporary stagnation, but perhaps if we look a little deeper, we might find an additional explanation. As I noted in a Comment of 6 January 2017, the golden era of US economic expansion was the ‘50s and ‘60s – but that era had begun to unravel somewhat, already, with the economic turbulence of the 70s. However, it was not so much Reagan’s fiscal or monetary policies that rescued a deteriorating situation in that earlier moment, but rather, it was plain old good fortune. The last giant oil fields with greater than 30-to-one, ‘energy-return’ on ‘energy-cost’ of exploitation, came on line in the 1980s: Alaska’s North Slope, Britain and Norway’s North Sea fields, and Siberia. Those events allowed the USA and the West generally to extend their growth another twenty years.

This week, there has been an avalanche of articles on Limits to Growth, just not titled so……. it’s almost as though the term is getting stuck in people’s throats, and are unable to pronounce them….

acrooke

Alastair Crooke

This article by former British diplomat and MI6 ‘ranking figure’ Alastair Crooke, is an unpublished article I’ve lifted from the Automatic Earth…… as Raul Ilargi succinctly puts it…:

 

His arguments here are very close to much of what the Automatic Earth has been advocating for years [not to mention DTM’s…], both when it comes to our financial crisis and to our energy crisis. Our Primers section is full of articles on these issues written through the years. It’s a good thing other people pick up too on topics like EROEI, and understand you can’t run our modern, complex society on ‘net energy’ as low as what we get from any of our ‘new’ energy sources. It’s just not going to happen.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Alastair Crooke: We have an economic crisis – centred on the persistent elusiveness of real growth, rather than just monetised debt masquerading as ‘growth’ – and a political crisis, in which even ‘Davos man’, it seems, according to their own World Economic Forum polls, is anxious; losing his faith in ‘the system’ itself, and casting around for an explanation for what is occurring, or what exactly to do about it. Klaus Schwab, the founder of the WEF at Davos remarked  before this year’s session, “People have become very emotionalized, this silent fear of what the new world will bring, we have populists here and we want to listen …”.

Dmitry Orlov, a Russian who was taken by his parents to the US at an early age, but who has returned regularly to his birthplace, draws on the Russian experience for his book, The Five Stages of Collapse. Orlov suggests that we are not just entering a transient moment of multiple political discontents, but rather that we are already in the early stages of something rather more profound. From his perspective that fuses his American experience with that of post Cold War Russia, he argues, that the five stages would tend to play out in sequence based on the breaching of particular boundaries of consensual faith and trust that groups of human beings vest in the institutions and systems they depend on for daily life. These boundaries run from the least personal (e.g. trust in banks and governments) to the most personal (faith in your local community, neighbours, and kin). It would be hard to avoid the thought – so evident at Davos – that even the elites now accept that Orlov’s first boundary has been breached.

But what is it? What is the deeper economic root to this malaise? The general thrust of Davos was that it was prosperity spread too unfairly that is at the core of the problem. Of course, causality is seldom unitary, or so simple. And no one answer suffices. In earlier Commentaries, I have suggested that global growth is so maddeningly elusive for the elites because the debt-driven ‘growth’ model (if it deserves the name ‘growth’) simply is not working.  Not only is monetary expansion not working, it is actually aggravating the situation: Printing money simply has diluted down the stock of general purchasing power – through the creation of additional new, ‘empty’ money – with the latter being intermediated (i.e. whisked away) into the financial sector, to pump up asset values.

It is time to put away the Keynesian presumed ‘wealth effect’ of high asset prices. It belonged to an earlier era. In fact, high asset prices do trickle down. It is just that they trickle down into into higher cost of living expenditures (through return on capital dictates) for the majority of the population. A population which has seen no increase in their real incomes since 2005 – but which has witnessed higher rents, higher transport costs, higher education costs, higher medical costs; in short, higher prices for everything that has a capital overhead component. QE is eating into peoples’ discretionary income by inflating asset balloons, and is thus depressing growth – not raising it. And zero, and negative interest rates, may be keeping the huge avalanche overhang of debt on ‘life support’, but it is eviscerating savings income, and will do the same to pensions, unless concluded sharpish.

But beyond the spent force of monetary policy, we have noted that developed economies face separate, but equally formidable ‘headwinds’, of a (non-policy and secular) nature, impeding growth – from aging populations in China and the OECD, the winding down of China’s industrial revolution,  and from technical innovation turning job-destructive, rather than job creative as a whole. Connected with this is shrinking world trade.

But why is the economy failing to generate prosperity as in earlier decades?  Is it mainly down to Greenspan and Bernanke’s monetary excesses?  Certainly, the latter has contributed to our contemporary stagnation, but perhaps if we look a little deeper, we might find an additional explanation. As I noted in a Comment of 6 January 2017, the golden era of US economic expansion was the ‘50s and ‘60s – but that era had begun to unravel somewhat, already, with the economic turbulence of the 70s. However, it was not so much Reagan’s fiscal or monetary policies that rescued a deteriorating situation in that earlier moment, but rather, it was plain old good fortune. The last giant oil fields with greater than 30-to-one, ‘energy-return’ on ‘energy-cost’ of exploitation, came on line in the 1980s: Alaska’s North Slope, Britain and Norway’s North Sea fields, and Siberia. Those events allowed the USA and the West generally to extend their growth another twenty years.

And, as that bounty tapered down around the year 2000, the system wobbled again, “and the viziers of the Fed ramped up their magical operations, led by the Grand Vizier (or “Maestro”) Alan Greenspan.”  Some other key things happened though, at this point: firstly the cost of crude, which had been remarkably stable, in real terms, over many years, suddenly started its inexorable real-terms ascent.  And from 2001, in the wake of the dot.com ‘bust’, government and other debt began to soar in a sharp trajectory upwards (now reaching $20 trillion). Also, around this time the US abandoned the gold standard, and the petro-dollar was born.

 


Source: Get It. Got It. Good, by Grant Williams

Well, the Hill’s Group, who are seasoned US oil industry engineers, led by B.W. Hill, tell us – following their last two years, or so, of research – that for purely thermodynamic reasons net energy delivered to the globalised industrial world (GIW) per barrel, by the oil industry (the IOCs) is rapidly trending to zero. Note that we are talking energy-cost of exploration, extraction and transport for the energy-return at final destination. We are not speaking of dollar costs, and we are speaking in aggregate. So why should this be important at all; and what has this to do with spiraling debt creation by the western Central Banks from around 2001?

The importance? Though we sometimes forget it, for we now are so habituated to it, is that energy is the economy.  All of modernity, from industrial output and transportation, to how we live, derives from energy – and oil remains a key element to it.  What we (the globalized industrial world) experienced in that golden era until the 70s, was economic growth fueled by an unprecedented 321% increase in net energy/head.  The peak of 18GJ/head in around 1973 was actually of the order of some 40GJ/head for those who actually has access to oil at the time, which is to say, the industrialised fraction of the global population. The Hill’s Group research  can be summarized visually as below (recall that these are costs expressed in energy, rather than dollars):

 


Source: http://cassandralegacy.blogspot.it/2016/07/some-reflections-on-twilight-of-oil-age.html

[This study was also covered here on Damnthematrix starting here…]

But as Steve St Angelo in the SRSrocco Reports states, the important thing to understand from these energy return on energy cost ratios or EROI, is that a minimum ratio value for a modern society is 20:1 (i.e. the net energy surplus available for GDP growth should be twenty times its cost of extraction). For citizens of an advanced society to enjoy a prosperous living, the EROI of energy needs to be much higher, closer to the 30:1 ratio. Well, if we look at the chart below, the U.S. oil and gas industry EROI fell below 30:1 some 46 years ago (after 1970):

 


Source: https://srsroccoreport.com/the-coming-breakdown-of-u-s-global-markets-explained-what-most-analysts-missed/

“You will notice two important trends in the chart above. When the U.S. EROI ratio was higher than 30:1, prior to 1970, U.S. public debt did not increase all that much.  However, this changed after 1970, as the EROI continued to decline, public debt increased in an exponential fashion”. (St Angelo).

In short, the question begged by the Hill’s Group research is whether the reason for the explosion of government debt since 1970 is that central bankers (unconsciously), were trying to compensate for the lack of GDP stimulus deriving from the earlier net energy surplus.  In effect, they switched from flagging energy-driven growth, to the new debt-driven growth model.

From a peak net surplus of around 40 GJ  (in 1973), by 2012, the IOCs were beginning to consume more energy per barrel, in their own processes (from oil exploration to transport fuel deliveries at the petrol stations), than that which the barrel would deliver net to the globalized industrial world, in aggregate.  We are now down below 4GJ per head, and dropping fast. (The Hill’s Group)

Is this analysis by the Hill’s Group too reductionist in attributing so much of the era of earlier western material prosperity to the big discoveries of ‘cheap’ oil, and the subsequent elusiveness of growth to the decline in net energy per barrel available for GDP growth?  Are we in deep trouble now that the IOCs use more energy in their own processes, than they are able to deliver net to industrialised world? Maybe so. It is a controversial view, but we can see – in plain dollar terms – some tangible evidence fo rthe Hill’s Groups’ assertions:

 


Source: https://srsroccoreport.com/wp-content/uploads/2016/08/Top-3-U.S.-Oil-Companies-Free-Cash-Flow-Minus-Dividends.png

(The top three U.S. oil companies, ExxonMobil, Chevron and ConocoPhillips: Cash from operations less Capex and dividends)

Briefly, what does this all mean? Well, the business model for the big three US IOCs does not look that great: Energy costs of course, are financial costs, too.  In 2016, according to Yahoo Finance, the U.S. Energy Sector paid 86% of their operating income just to service the interest on the debt (i.e. to pay for those extraction costs). We have not run out of oil. This is not what the Hill’s Group is saying. Quite the reverse. What they are saying is the surplus energy (at a ratio of now less than 10:1) that derives from the oil that we have been using (after the energy-costs expended in retrieving it) – is now at a point that it can barely support our energy-driven ‘modernity’.  Implicit in this analysis, is that our era of plenty was a one time, once off, event.

They are also saying that this implies that as modernity enters on a more severe energy ‘diet’, less surplus calories for their dollars – barely enough to keep the growth engine idling – then global demand for oil will decline, and the price will fall (quite the opposite of mainstream analysis which sees demand for oil growing. It is a vicious circle. If Hills are correct, a key balance has tipped. We may soon be spending more energy on getting the energy that is required to keep the cogs and wheels of modernity turning, than that same energy delivers in terms of calorie-equivalence.  There is not much that either Mr Trump or the Europeans can do about this – other than seize the entire Persian Gulf.  Transiting to renewables now, is perhaps too little, too late.

And America and Europe, no longer have the balance sheet ‘room’, for much further fiscal or monetary stimulus; and, in any event, the efficacy of such measures as drivers of ‘real economy’ growth, is open to question. It may mitigate the problem, but not solve it. No, the headwinds of net energy per barrel trending to zero, plus the other ‘secular’ dynamics mentioned above (demography, China slowing and technology turning job-destructive), form a formidable impediment – and therefore a huge political time bomb.

Back to Davos, and the question of ‘what to do’. Jamie Dimon, the CEO of  JPMorgan Chase, warned  that Europe needs to address disagreements spurring the rise of nationalist leaders. Dimon said he hoped European Union leaders would examine what caused the U.K. to vote to leave and then make changes. That hasn’t happened, and if nationalist politicians including France’s Marine Le Pen rise to power in elections across the region, “the euro zone may not survive”. “The bottom line is the region must become more competitive, Dimon said, which in simple economic terms means accept even lower wages. It also means major political overhauls: “I say this out of respect for the European people, but they’re going to have to change,” he said. “They may be forced by politics, they may be forced by new leadership.”

A race to the bottom in pay levels?  Italy should undercut Romanian salaries?  Maybe Chinese pay scales, too? This is politically naïve, and the globalist Establishment has only itself to blame for their conviction that there are no real options – save to divert more of the diminished prosperity towards the middle classes (Christine Lagarde), and to impose further austerity (Dimon). As we have tried to show, the era of prosperity for all, began to waver in the 70s in America, and started its more serious stall from 2001 onwards. The Establishment approach to this faltering of growth has been to kick the can down the road: ‘extend and pretend’ – monetised debt, zero, or negative, interest rates and the unceasing refrain that ‘recovery’ is around the corner.

It is precisely their ‘kicking the can’ of inflated asset values, reaching into every corner of life, hiking the cost of living, that has contributed to making Europe the leveraged, ‘high cost’, uncompetitive environment, that it now is.  There is no practical way for Italians, for example, to compete with ‘low cost’ East Europe, or  Asia, through a devaluation of the internal Italian price level without provoking major political push-back.  This is the price of ‘extend and pretend’.

It has been claimed at Davos that the much derided ‘populists’ provide no real solutions. But, crucially, they do offer, firstly, the hope for ‘regime change’ – and, who knows, enough Europeans may be willing to take a punt on leaving the Euro, and accepting the consequences, whatever they may be. Would they be worse off? No one really knows. But at least the ‘populists’ can claim, secondly, that such a dramatic act would serve to escape from the suffocation of the status quo. ‘Davos man’ and woman disdain this particular appeal of ‘the populists’ at their peril.

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Saving the Planet is More Than Just Switching to Renewables

3 05 2016

I’m too busy sawmilling, wiring up power stations, and crushing apples right now to write much on DTM, though if the current ‘drought breaking’ rain continues, I will have an opportunity to write another update…. in the meantime, enjoy this article, a true breath of fresh air, even if it makes mo mention of Limits to Growth….

Photo credit: Bush Philosopher – Dave Clarke via Foter.com / CC BY-NC-ND. Article cross-posted from Local Futures. Written by Steven Gorelick.

Among climate change activists, solutions usually center on a transition to renewable energy. There may be differences over whether this would be best accomplished by a carbon tax, bigger subsidies for wind and solar power, divestment from fossil fuel companies, massive demonstrations, legislative fiat, or some other strategy, but the goal is generally the same: Replace dirty fossil fuels with clean renewable energy. Such a transition is often given a significance that goes well beyond its immediate impact on greenhouse gas emissions: It would somehow make our exploitative relationship to nature more environmentally sound, our relationship to each other more socially equitable. In part, this is because the fossil fuel corporations — symbolized by the remorseless Koch brothers — will be a relic of the past, replaced by “green” corporations and entrepreneurs that display none of their predecessors’ ruthlessness and greed.

Maybe, but I have my doubts. Here in Vermont, for example, a renewable energy conference last year was titled, “Creating Prosperity and Opportunity Confronting Climate Change.” The event attracted venture capitalists, asset management companies, lawyers that represent renewable energy developers, and even a “brandthropologist” offering advice on “How to Evolve Brand Vermont” in light of the climate crisis. The keynote speaker was Jigar Shah, author of Creating Climate Wealth, who pumped up the assembled crowd by telling them that switching to renewables “represents the largest wealth creation opportunity of our generation.” He added that government has a role in making that opportunity real: “Policies that incentivize resource efficiency can mean scalable profits for businesses.”[1] If Shah is correct, the profit motive ­— in less polite company it might be called “greed” — will still be around in a renewable energy future.

But at least the renewable energy corporations will be far more socially responsible than their fossil fuel predecessors. Not if you ask the Zapotec communities in Mexico’s Oaxaca state, who will tell you that a renewable energy corporation can be just as ruthless as a fossil fuel one. Oaxaca is already home to 21 wind projects and 1,600 massive turbines, with more planned. While the indigenous population must live with the wind turbines on their communal lands, the electricity goes to distant urban areas and industries. Local people say they have been intimidated and deceived by the wind corporations: According to one indigenous leader, “They threaten us, they insult us, they spy on us, they block our roads. We don’t want any more wind turbines.” People have filed grievances with the government (which has actively promoted the wind projects) and have physically blocked access to development sites.[2]

It seems that a transition to renewable energy might not be as transformative as some people hope. Or, to put it more bluntly, renewable energy changes nothing about corporate capitalism.

Which brings me to the new film, This Changes Everything, based on Naomi Klein’s best-selling book and directed by her husband, Avi Lewis. I saw the film recently at a screening hosted by local climate activists and renewable energy developers, and was at first hopeful that the film would go even further than the book in, as Klein puts it, “connecting the dots between the carbon in the air and the economic system that put it there.”

But by film’s end, one is left with the impression that a transition from fossil fuels to renewables is pretty much all that’s needed — not only to address climate change, but to transform the economy and solve all the other problems we face. As the camera tracks skyward to reveal banks of solar panels in China or soars above 450-foot tall wind turbines in Germany, the message seems to be that fully committing to these technologies will change everything. This is surprising, since Klein’s book flatly contradicts this way of thinking:

“Over the past decade,” she wrote, “many boosters of green capitalism have tried to gloss over the clashes between market logic and ecological limits by touting the wonders of green tech…. They paint a picture of a world that can function pretty much as it does now, but in which our power will come from renewable energy and all of our various gadgets and vehicles will become so much more energy-efficient that we can consume away without worrying about the impact.”

Instead, she says, we need to “consume less, right away. [But] Policies based on encouraging people to consume less are far more difficult for our current political class to embrace than policies that are about encouraging people to consume green. Consuming green just means substituting one power source for another, or one model of consumer goods for a more efficient one. The reason we have placed all of our eggs in the green tech and green efficiency basket is precisely because these changes are safely within market logic.”[3]

Overall, Klein’s book is far better at “connecting the dots” than the film. The book explains how free trade treaties have led to a huge spike in emissions, and Klein argues that these agreements need to be renegotiated in ways that will curb both emissions and corporate power. Among other things, she says, “long-haul transport will need to be rationed, reserved for those cases where goods cannot be produced locally.” She explicitly calls for “sensible relocalization” of the economy, as well as reduced consumption and “managed degrowth” in the rich countries of the North — notions likely to curdle the blood of capitalists everywhere. She endorses government incentives for local and seasonal food, as well as land management policies that discourage sprawl and encourage low-energy, local forms of agriculture.

I don’t buy everything about Klein’s arguments: They rest heavily on unquestioned assumptions about the course of development in the global South, and focus too much on scaling up government and not enough on scaling down business. The “everything” that will change sometimes seems limited to the ideological pendulum: After decades of pointing toward the neoliberal, free-market right, she believes it must swing back to the left because climate change demands a huge expansion of government planning and support.

Nonetheless, many of the specific steps outlined in the book do have the potential to shift our economic system in important ways. Those steps, however, are given no space at all in the film. The focus is almost entirely on transitioning to renewables, which turns the film into what is essentially an informercial for industrial wind and solar.

The film starts well, debunking the notion that climate change is a product of human nature – of our innate greed and short-sightedness. Instead, Klein says, the problem lies in a “story” we’ve told ourselves for the past 400 years: that Nature is ours to tame, conquer, and extract riches from. In that way, Klein says, “Mother Nature became the mother lode.”

After a gut-wrenching segment on the environmental disaster known as the Alberta tar sands, the film centers on examples of “Blockadia” — a term coined by activists to describe local direct action against extractive industries. There is the Cree community in Alberta fighting the expansion of tar sands development; villagers in India blocking construction of a coal-fired power plant that would eliminate traditional fishing livelihoods; a community on Greece’s Halkidiki Peninsula battling their government and the police to stop an open pit gold mine that would destroy a cherished mountain; and a small-scale goat farmer in Montana joining hands with the local Cheyenne community to oppose a bevy of fossil fuel projects, including a tar sands pipeline, a shale oil project, and a new coal mine.

Klein implies that climate change underlies and connects these geographically diverse protests. But that’s partly an artifact of the examples Klein chose, and partly a misreading of the protestors’ motives: What has really driven these communities to resist is not climate change, but a deeply felt desire to maintain their traditional way of life and to protect land that is sacred to them. A woman in Halkidiki expresses it this way: “We are one with this mountain; we won’t survive without it.” At its heart, the threat that all of these communities face doesn’t stem from fossil fuels, but from a voracious economic system that will sacrifice them and the land they cherish for the sake of profit and growth.

The choice of Halkidiki as an example actually undermines Klein’s construct, since the proposed mine has nothing directly to do with fossil fuels. It does, however, have everything to do with a global economy that runs on growth, corporate profit, and — as Greece knows only too well — debt. So it is with all the other examples in the film.

Klein’s narrative would have been derailed if she profiled the indigenous Zapotec communities of Oaxaca as a Blockadia example: They fit the bill in every respect other than the fact that it’s renewable energy corporations, not fossil fuel corporations, they are trying to block. Similarly, Klein’s argument would have suffered if she visited villagers in India who are threatened not by a coal-fired power plant, but by one of India’s regulation-free corporate enclaves known as “special economic zones”. These, too, have sparked protests and police violence against villagers: In Nandigram in West Bengal, 14 villagers were killed trying to keep their way of life from being eliminated, their lands turned into another outpost of an expanding global economy.[4]

And while the tar sands region is undeniably an ecological disaster, it bears many similarities to the huge toxic lake on what was once pastureland in Baotou, on the edge of China’s Gobi Desert. The area is the source of nearly two-thirds of the world’s rare earth metals – used in almost every high-tech gadget (as well as in the magnets needed for electric cars and industrial wind turbines). The mine tailings and effluent from the many factories processing these metals have created an environmental disaster of truly monumental proportions: The BBC describes it as “the worst place on earth”.[5] A significant shrinking of global consumer demand would help reduce Baotou’s toxic lake, but it’s hard to see how a shift to renewable energy would.

Too often, climate change has been used as a Trojan horse to enable corporate interests to despoil local environments or override the concerns of local communities. Klein acknowledges this in her book: By viewing climate change only on a global scale, she writes, we end up ignoring “people with attachments to particular pieces of land with very different ideas about what constitutes a ‘solution,’ This chronic forgetfulness is the thread that unites so many fateful policy errors of recent years… [including] when policymakers ram through industrial-scale wind farms and sprawling… solar arrays without local participation or consent.”[6] But this warning is conspicuously absent from the film.

Klein’s premise is that climate change is the one issue that can unite people globally for economic change, but there’s a more strategic way to look at it. What we face is not only a climate crisis but literally hundreds of potentially devastating crises: there’s the widening gap between rich and poor, islands of plastic in the oceans, depleted topsoil and groundwater, a rise in fundamentalism and terror, growing piles of toxic and nuclear waste, the gutting of local communities and economies, the erosion of democracy, the epidemic of depression, and many more. Few of these can be easily linked to climate change, but all of them can be traced back to the global economy.

This point is made by Helena Norberg-Hodge, founder of Local Futures, who explains how a scaling down of the corporate-led global economy and a strengthening of diverse, localized economies would simultaneously address all of the most serious problems we face – including climate change.[7] For this reason, what Norberg-Hodge calls “big picture activism” has the potential to unite climate change activists, small farmers, peace advocates, environmentalists, social justice groups, labor unions, indigenous rights activists, main street business owners, and many more under a single banner. If all these groups connect the dots to see the corporate-led economy as a root cause of the problems they face, it could give rise to a global movement powerful enough to halt the corporate juggernaut.

And that really could change everything.

##

[1] Shaheen, Troy, “Climate change may have economic potential for Vermont” VTDigger.org, Feb. 20, 2015.

[2] “Defining and Addressing Community Opposition to Wind Development in Oaxaca” Equitable Origin, updated January 2106.

[3] Klein, Naomi, This Changes Everything: Capitalism vs. The Climate (Simon and Shuster, 2014), page 90.

[4] “Nandigram Violence a ‘State-Sponsored Massacre’” Countercurrents.org, August 9, 2007.

[5] Maughan, Tim, “The dystopian lake filled by the world’s tech lust” BBC Future, April 2, 2015.

[6] Klein, op. cit., page 287.

[7] Norberg-Hodge, Helena, Localisation: Essential Steps to an Economics of Happiness, Local Futures, 2015.





Falling Empires and the Future of Democracy in 21st Century America

4 09 2014

John Michael Greer

John Michael Greer, also known as the infamous Archdruid, speaks to the Extra Environmentalist about his latest book, Decline and Fall.  Greer’s insight is simply phenomenal, and the way he explains why and how the USA’s Empire is going down is just fascinating.

About one hour later, (yes, it’s a long podcast, but worth every MB you download) Chris Martenson speaks about he energy descent and how it will affect the future.

Chris Martenson

Chris Martenson

I suggest you download this to a memory stick and listen to it in bits on your favourite sound player while you do something menial….  and you’ll probably want to listen to it several times!!

Enjoy…  and make sure you share with anybody who still doesn’t ‘get it’…..

The End of Empire and the Future of Democracy in 21st Century America

http://www.extraenvironmentalist.com/2014/09/02/episode-81-falling-empires/#





Chris Martenson-People Will Be Wiped Out In Coming Crash

2 07 2014

A big thank you to Marg from Tassie for the heads up on this video…….  how it slipped through to the keeper, I don’t know, but this is Chris Martenson at his best.

http://usawatchdog.com/iraq-crisis-15… Chris Martenson, who holds a PhD in pathology and an MBA, contends 2008 was just a warm up to a much bigger calamity. Martenson says, “2008 was the shot across the bow, and that’s when our credit experiment broke, and we have been doing everything possible to paper over it since. . . . When you take real stuff out of the ground, you grow food, you take oil out of the ground, you process ore into steel, and you manufacture real things–that’s real wealth. The claims (such as stocks, bonds and currencies) have to be in proportion to the real wealth, and the claims have been growing and growing and growing for so long that they are way out of balance to the real stuff, and the real stuff isn’t growing like it used to. You can see that in the GDP numbers for the U.S. or the world at large. Growth is slowing, slowing, slowing, and the claims are getting larger and larger. This represents a huge and gigantic source of potential energy. There is a gap there and it’s going to get closed. Only one of two things are going to happen: (1) real stuff starts expanding like crazy, or (2) the claims get destroyed. That’s what we are talking about when we talk about a market crash. The claims get destroyed. People get wiped out. The people who don’t get ruined are people safely over in the real wealth already. If you own an unencumbered farm, if you own a productive asset, if you own gold or silver, or if you own your house outright, you are going to be vastly safer than . . . someone who is leveraged and hinged into this other system.”

Join Greg Hunter as he goes One-on-One with Chris Martenson co-founder of PeakProsperity.com.





The more we consume, the less we care about the living planet.

18 05 2014

monbiotGeorge Monbiot has just published a most fascinating article about the environmental impact of various nations, their feelings of guilt over the matter and so on, with terrific charts to clearly explain the sordid state of affairs we have now reached..

George reminds us of the famous quote perhaps mistakenly attributed to Gandhi. When asked by a journalist during a visit to Britain, “What do you think of Western civilization?”, he’s reputed to have replied, “I think it would be a good idea.”

Not unexpectedly…….:

mapping climate change commitmentsAs for the US, Australia and Canada, they are ranked among the worst of all: comprehensively failing to limit their massive contribution to a global problem. We justify our foot-dragging with a mistaken premise. Our refusal to stop pumping so much carbon dioxide into the atmosphere is pure selfishness. [click on map for larger view]

The fact that the poorer nations are doing more, far more in fact, than we are to combat manmade climate change and feel more guilt than Australians (or other Anglophone nation!) blew me away……  we truly don’t care.  It seems that Western Civilisation is in fact a bad idea…..

“Why” asks George “is it so difficult to persuade people to care about our wonderful planet, the world that gave rise to us and upon which we wholly depend? And why do you encounter a barrage of hostility and denial whenever you attempt it (and not only from the professional liars who are paid by coal and oil and timber companies to sow confusion and channel hatred)?”

“The first thing to note, in trying to answer this question,” writes George “is that the rich anglophone countries are anomalous. In this bar chart (copied from the website of the New York Times) you can see how atypical the attitudes of people in the US and the UK are. Because almost everything we read in this country is published in rich, English-speaking nations, we might get the false impression that the world doesn’t care very much.”

bar chart from New York TimesAustralians obviously don’t care much either.  After all, we elected the most uncaring government ever.  They don’t care about the aged, the weak, the sick, the unemployed, and they sure as hell don’t give a stuff about the environment.

Both the map and the bar chart overlap to some degree with the fascinating results of the Greendex survey of consumer attitudes.

For years we’ve been told that people cannot afford to care about the natural world until they become rich; that only economic growth can save the biosphere, that civilisation marches towards enlightenment about our impacts on the living planet. The results suggest the opposite.

Greendex graphNotice how there are no nations in the Low Greendex/Very guilty corner…….??  “The more we consume,” says George, “the less we feel. And maybe that doesn’t just apply to guilt.”

Perhaps that’s the point of our otherwise-pointless hyperconsumption: it smothers feeling. It might also be the effect of the constant bombardment of advertising and marketing. They seek to replace our attachments to people and place with attachments to objects: attachments which the next round of advertising then breaks in the hope of attaching us to a different set of objects.

So the perennially low level of concern, which flickers upwards momentarily when disaster strikes, then slumps back into the customary stupor, is an almost inevitable result of a society that has become restructured around shopping, fashion, celebrity and an obsession with money. How we break the circle and wake people out of this dreamworld is the question that all those who love the living planet should address. There will be no easy answers.

http://www.monbiot.com

 





In Defence of Inaction

21 04 2014

Dave Pollard

Dave Pollard

To say I love Dave Pollard’s writings is an understatement.  As is, that we think as one……  so here is another guest post by Dave for your enjoyment.  Is that inappropriate wording perhaps?  Does anyone enjoy admitting we’re shafted…?  Is this “giving up” a new movement maybe..?  Hot on the heels of Mike Ruppert doing himself in – the ultimate “I give up” action – to the admission of defeat from Paul Kingnorth, David Suzuki now saying it’s too late, let alone all the Near Term Extinctionists like Guy McPherson predicting the ultimate apocalypse, a growing number of activists are calling it a day, deciding that we have to shift from global activism to local.  And I agree too.  But you probably knew that already…..  it’s time to hunker down.

In Defence of Inaction

Filed under: Preparing for Civilization’s End — Dave Pollard

I have, of late, had a falling out with many of my fellow ‘progressives’, similar I suppose to that of Paul Kingsnorth, who is being savaged by Naomi Klein and others for giving up on the environmental movement and non-local activism, and by humanists for losing faith in our species’ capacity for innovation and change.

I should say at the outset that I agree that our political and economic and legal and educational and social systems are dreadful, unfair, teetering, and totally inadequate to our needs. I agree that this is a world of horrific inequality, inequitable and unjust privilege, massive suffering, and outrageous patriarchy. I agree that corporatism and corruption and propagandist media are rampant and destructive and destabilizing. I agree that militarized police and torture prisons and drone killing and massive global surveillance are repugnant and a fundamental threat to our personal safety and security and the very principles upon which our nations are founded.

And I fully acknowledge that the fact I’m white, male, boomer generation and relatively wealthy provides me with enormous privilege compared to others, including relative freedom of movement, freedom from fear of harassment and assault, and greater social, political and economic opportunity.

But when I hear arguments that “we need” to stand up for our ‘inherent’ rights and freedoms, and wrest ‘control’ of the levers of power from the obscenely wealthy elite, and denounce and protest injustice and inequality, and acknowledge and renounce our role as privileged oppressors, as the first steps to a true social revolution and political and economic reform, leading, somehow, to a radical redistribution of wealth and power, and a more just society, I am reduced to despair.

I used to believe people, and perhaps some other creatures, had ‘rights’ and ‘freedoms’. I believed that someone was in control. I believed there were answers to the predicaments we face.

But now I realize that there are no rights or freedoms. The concept of rights and freedoms is a sop that the rich and powerful of this world use to appease the fury and frustration of the poor and disenfranchised. The ‘granting’ of rights and freedoms means nothing, because they can be and are taken away whenever those in power choose to do so, and are simply ignored when they interfere with the exercise of power or accumulation of wealth by those who allowed them to be granted.

We don’t have freedom of expression, or speech, or assembly: under the current surveillance state I can be stopped, arrested, held indefinitely and incommunicado, tortured, ‘disappeared’ or simply killed, by a drone or in a secret gulag, whenever someone in power decides I’m a threat to that power.

Likewise, there is no ‘upward mobility’ for just about any demographic segment of our human population worldwide; most people are trapped, socially and economically, right where they are, no matter what may happen to the place where they live.

There is no true democracy, anywhere: the real decisions are made in secret meetings between bought politicians (many of them in power fraudulently or due to gerrymandering and other corruptions of the ‘democratic’ process), who represent only their rich and powerful donors, and the bankers, lawyers and corporate executives. The ‘laws’ and ‘regulations’ are just smokescreens to make it look as if the people’s interests are being considered.

There are no rights of recourse against corporate abuses: most industries are oligopolies, and corporate law is designed to protect them and their wealthy shareholders and executives from the wrath of outraged citizens, while enabling these corporations to sue citizens who pose any threat to their profits or ‘leadership’.

All that’s happened over the past three decades is that the illusion of rights and freedoms has largely disappeared, as those with wealth and power ratchet up the rhetoric that militarized police, torture prisons, ubiquitous surveillance and the oppression of dissent are ‘necessary’ for public safety and security (especially the safety and security of the rich and powerful).

There are no rights or freedoms. There is only power, and its exercised in the interest of further enriching the rich and further concentrating power.

I used to be outraged and angry about all this, but now I’m just letting it go. It’s just too easy to see this as a moral struggle, as a fight against pathology, greed, and tyranny. I don’t think it’s that simple. I think everyone’s really trying to do what they believe is best, not only for their loved ones but for everyone. I know some of these people, and their stubborn, destructive wrong-headedness is completely understandable to me (from their strange but deeply-held worldview).

Increasing concentration of power doesn’t mean that there is an ‘elite’ in control of everything in our society. Vast wealth and power does not translate to control, especially in a world where all our systems are collapsing simultaneously: our economic systems, running on the fumes of belief in perpetual industrial growth; our nearly-exhausted energy and resource systems, utterly dependent on ample and cheap oil (one barrel of oil replaces 12 person-years of labour, and we currently use 100 million barrels per day); and our climate systems, which have long passed the tipping point to catastrophic change comparable to that of the ‘ice ages’ (though in the opposite temperature direction).

The rich and powerful are as much prisoners of these massive, complex, crumbling systems, as much cogs in the machine, as the rest of us: they just get better wages and benefits than the rest of the inmates, and will until the systems fall apart, at which time they’ll be no better off than anyone else.

No one is in control. The enemy, if there is one, is not a cabal of elites, but a set of co-dependent collapsing systems that every one of us has a vested interest in trying (insanely) to perpetuate. Systems we have all helped co-create and are almost all dependent on.

David Korowicz, in his study On the Cusp of Collapse, explains how our massively complex global human systems are far beyond the control of any coordinated group of people:

Our daily lives are dependent upon the coherence of thousands of direct interactions, which are themselves dependent upon trillions more interactions between things, businesses, institutions and individuals across the world. Following just one track; each morning I have coffee near where I work. The woman who serves me need not know who picked the berries, who moulded the polymer for the coffee maker, how the municipal system delivered the water to the café, how the beans made their journey or who designed the mug. The captain of the ship that transported the beans would have had no knowledge of who provided the export credit insurance for the shipment, who made the steel for the hull, or the steps in the complex processes that allow him the use of satellite navigation. And the steel-maker need not have known who built the pumps for the iron-ore mine, or how the oxygen for the furnace was refined.

We cannot hope to ‘fix’ these systems through political or economic or legal or educational reform, or putting some more democratically-minded group ‘in control’ of them. Fighting for possession of the steering wheel of a car careering over a cliff cannot produce useful change. Even trying to bring down our economic systems before they do even more damage is probably futile: It’s unlikely to significantly accelerate, mitigate or delay the inevitable collapse, and I’m not sure its effect on catastrophic climate change would be substantial either. There is simply no point trying to change any of these systems; it’s a waste of time, and, as Buddha said “Our problem is we think we have time.” But some would insist we try anyway, so at least “we can say we tried”. I think that’s a pathetic argument.

So here we sit, all of us, rich and poor, powerful and powerless, with no real ‘rights’ or ‘freedoms’, no hope of ‘reforming’ massive, self-reinforcing and entrenched systems utterly out of our control, coming apart because they are totally unsustainable, and no credible knowledge of what might work to even mitigate the imminent and catastrophic end of the industrial ‘growth’ economy, the end of the all-too-brief age of abundant cheap energy, and the end of a short few millennia of astonishingly stable climate.

The question we must each ask ourselves, I think, is this:  If we acknowledge that our systems and hence our civilization cannot be reformed or ‘saved’, what can we do now that will make a real difference, for the future, in our communities and for those we love?

The insanely rational answer to this question, I think, is (a) probably nothing, and (b) it’s too early to know.

So if I seem impatient or annoyed when you ask me to be outraged or supportive in your movement to reform civilization, I’m sorry. I think it’s too late.

I’m in the process of writing a book of stories of how all of this might play out, just one scenario, the story of, in the short term, a Great Migration of billions of people towards the poles in search of livable habitat (what an amazing, terrifying and liberating journey that could be!), and, in the longer term, the blossoming of thousands of local communities, new and unimaginably diverse, self-sufficient, joyful and utterly alive human cultures, whose total impact on the planet will be, due to our much smaller numbers and minimal energy and technology resources, pretty insignificant. I need to write such a new story to be able to begin to let go of the old, civilized one.

Maybe that’s not enough. Maybe there’s more I could (I’ve stopped saying “should”) be doing: learning new essential skills and capacities, helping in the process of rediscovering how to build and live in community together, healing myself and helping others heal from the ravages of civilization’s innumerable, constant and monstrous stresses, and just trying to live a joyful, exemplary, modest and graceful life. I may get around to these things. But for now I’m just writing, watching, reflecting, trying to figure it all out.

It’s too early and too late, I think, to do anything more.





Collapse Is Very Difficult To Avoid

22 03 2014

simonblackSubmitted by Simon Black of Sovereign Man blog, lifted from Zero Hedge

As any long-time reader of this column knows, we routinely draw from historical lessons to highlight that this time is not different.

Throughout the 18th century, for example, France was the greatest superpower in Europe, if not the world.  But they became complacent, believing that they had some sort of ‘divine right’ to reign supreme, and that they could be as fiscally irresponsible as they liked.  The French government spent money like drunken sailors; they had substantial welfare programs, free hospitals, and grand monuments. They held vast territories overseas, engaged in constant warfare, and even had their own intrusive intelligence service that spied on King and subject alike.

Of course, they couldn’t pay for any of this.

French budget deficits were out of control, and they resorted to going heavily into debt and rapidly debasing their currency.

Stop me when this sounds familiar.

The French economy ultimately failed, bringing with it a 26-year period of hyperinflation, civil war, military conquest, and genocide.

History is full of examples, from ancient Mesopotamia to the Soviet Union, which show that whenever societies reach unsustainable levels of resource consumption and allocation, they collapse.  I’ve been writing about this for years, and the idea is now hitting mainstream.

A recent research paper funded by NASA highlights this same premise.

According to the authors:

    “Collapses of even advanced civilizations have occurred many times in the past five thousand years, and they were frequently followed by centuries of population and cultural decline and economic regression.”

The results of their experiments show that some of the very clear trends which exist today– unsustainable resource consumption, and economic stratification that favors the elite– can very easily result in collapse.  In fact, they write that “collapse is very difficult to avoid and requires major policy changes.”

This isn’t exactly good news.

But here’s the thing– between massive debts, deficits, money printing, war, resource depletion, etc., our modern society seems riddled with these risks.  And history certainly shows that dominant powers are always changing.

Empires rise and fall. The global monetary system is always changing. The prevailing social contract is always changing.

But there is one FAR greater trend across history that supercedes all of the rest… and that trend is the RISE of humanity.

Human beings are fundamentally tool creators. We take problems and turn them into opportunities. We find solutions. We adapt and overcome.

The world is not coming to an end. It’s going to reset. There’s a huge difference between the two.

Think about the system that we’re living under.  A tiny elite has total control of the money supply. They wield intrusive spy networks and weapons of mass destruction. The can confiscate the wealth of others in their sole discretion. They can indebt unborn generations.  Curiously, these are the same people who are so incompetent they can’t put a website together.  It’s not working. And just about everyone knows it.  We’re taught growing up that ‘We the People’ have the power to affect radical change in the voting booth. But this is another fairy tale.

Voting only changes the players. It doesn’t change the game.

Technology is one major game changer. The technology exists today to completely revolutionize the way we live and govern ourselves.  Today’s system is just a 19th century model applied to a 21st century society. I mean– a room full of men making decisions about how much money to print? It’s so antiquated it’s almost comical.

But given that the majority of Western governments borrow money just to pay interest on money they’ve already borrowed, it’s obvious the current game is almost finished.

When it ends, there will be a reset… potentially a tumultuous one.  This is why you want to have a plan B, and why you don’t want to have all of your eggs in one basket.  After all, why bother working so hard if everything you’ve ever achieved or provided for your children is tied up in a country with dismal fundamentals?

If you agree with me, then feel free to share this article with your friends below so they also can get a plan B in place. They’ll be glad they did.