When we talk about what will be the next economy, it’s easy to get excited about a local bakery or a payment-in-kind system that circumvents The Man.
Skill-swapping, gardening, knowing your neighbors – these are brilliant and vital parts of a hopeful future. But all the warm and fuzzy feelings we get from sharing bran muffins in the local town hall can sometimes obscure rather than highlight the reality of the situation we’re in.
What I hope to do is paint an honest picture of what I see coming.
1. We won’t move to a new economy until this one has run its course.
The majority of all banks are functionally insolvent, as are the majority of Organization for Economic Co-operation and Development (OECD) governments.
But nobody shows any sign of blinking. There’s too much tied up in the growth system for a revival-style awakening.
If the ineffectiveness of this system becomes apparent to the public only over a period of years, as has happened, there wont likely be enough impetus to move towards an alternative.
If, however, there was a catastrophic interruption, probably characterized by the sovereign default of one or more wealthy industrialized nations, combined with what John Michael Greer calls hyperstagflation—meaning a period of wild inflation coupled to a shrinking economy—that kind of dramatic collapse would definitely spur personal action and government policy.
But the ability to implement changes would be limited by the resources and funds of the willing parties.
2. Without current oil, talk of a renewable energy economy is utter nonsense.
Indium is one of the rare earth metals, 98% of which is exported to the world’s manufacturers from China.
It’s dug out of the ground with oil, processed with oil, transported with oil, transformed into solar panels and LCD screens with oil and shipped to end users with oil where it’s wrapped in plastic made from oil and mounted on shelves made of oil so that workers who got to the shop using oil can sell the panels to customers who arrived using oil.
The only mature renewable technology that we have right now is solar power. And even that, while brilliant for low-level daytime electricity and water heating, is not globally scalable in an oil-depleted world still wed to business-as-usual.
Biofuels on the other hand are a joke. They’re either a short-lived love affair or a global catastrophe, depending on the length of our flirtation.
The only biofuels produced at an industrial scale are corn-based, and corn, as we all know, is a global food staple. In 2009, the US used 26% of its corn crop to make ethanol. The 2011 output might reach 40%.
Not only is this dangerously short-sighted in a food-dependent world, but it’s also unsustainable. Corn is grown using intensive fossil fuel inputs. Even if the entire US corn crop was turned into ethanol without any external inputs, it still wouldn’t begin to cover domestic liquid fuel usage.
3. Transportation will not likely exist in its current form much longer.
Depending on the depletion curve, businesses solely relying on the affordability of oil for their profit margin (such as the airline and trucking industries) will either be reduced to functioning only for the purpose of subsistence or may go out of business altogether.
Commercial aviation is already only viable because of government largesse. In a future of economic restraint and oil price escalation, commercial consumer flight is completely irrational and uneconomic.
To give you an idea of how behind the times we are in the UK, in the budget announced recently, our Chancellor of the Exchequer announced he would levy a passenger duty on private aviation for the first time ever.
That’s right, we’ve had private aviation in Britain for the best part of a century and it’s never been taxed, even while fuel and passenger duty on normal public aviation went up every six months to a year.
Not to mention that a post-peak oil world in which private aviation is even legal seems insane.
For what it’s worth, I’d much rather all that oil be turned into the sanitary products, medicinal packaging and hypodermic delivery cylinders that we really need for health care rather than blown out the ass of a JP Morgan-branded Gulfstream jet.
Diesel-intensive trucking is in the same fix.
The EU recently presented plans for the majority of supply chains to be run by rail and waterway by 2050. The upside is that at least there seems to be a growing awareness of the energy decline problem and a rational approach to a solution. The downside is that idyllic rural living which is so sought-after now will be untenable unless you’re completely self-sufficient.
But if you’re not connected by rail or waterway, you’ll be out in the cold.
4. The power structure will look after itself, not you.
In the event of a serious supply freeze, say an uprising or civil war in Saudi Arabia or Iran, only three tiers of oil usage will receive any kind of due diligence from the authorities: government, military and high-end corporate.
The rest of us will be on rations if we’re lucky. Not even the ambulances will run if the oil is needed by the power companies, the White House and the Marines.
There are countries in Eastern Europe (Romania for one) where for the past several years ambulance drivers have forced patients to pay for gas to get to the hospital. And that’s with a national health service.
For a country as atomized as the US, the result of a rationing environment would be civil unrest and local violence on an unprecedented scale.
The so-called Strategic Oil Reserve of the US is a sham and would be zapped in a matter of weeks, even with rationing. The end result would be a state of emergency and troops on the street to keep the peace. But even those troops would need oil.
And in that scenario, I believe that rolling hills quietly growing cabbages, disturbed only by the call of the songbirds at dusk, will simply not happen.
The urban dispossessed and the local disenfranchised will want a piece of the new pie, and there will be precious little effective state control over whether they take it from you or not.
5. The land ain’t what it used to be.
If the depletion curve is softer and gives us a nice, gentle slope towards a different way of doing things, then that time will be consumed with typical government subsidies for dangerous sidetracks like nuclear power, shale gas fracking or fusion. Otherwise known as Corporate Socialism.
The British government, with no consultation, just gave the go-ahead for a shale gas fracking operation in Lancashire. The plans for the American fields are to keep going, full steam ahead, and hang the consequences. By the time we arrive at a point where any kind of drilling or fracking is either uneconomical or downright impossible, who knows how much of the water table will be poisoned?
As Fukushima continues to wheeze radioactive particles over what was one of Japan’s most productive regions, we can only take away the message that even counting on the land to offer up the food we are driven enough to cultivate on it seems cornucopian.
The cesium that has been released has a radioactive half-life of 30 years.
And as budgets are slashed, companies struggle harder than ever to make a profit, workers lose their collective rights and job security and the energy we need to run the necessary safety and redundancy systems becomes increasingly expensive and scarce, how many more nuclear reactors will let us down?
Agriculture is over in the OECD countries. We’ve used every inch of land that we possibly can. Yields are falling.
It takes 11 times the land area of the Netherlands to supply that country with food and absorb its waste.
Even if you discounted the CO2 absorption, you still have a land area orders of magnitude larger than the country in question. That doesn’t even take into account how utterly exhausted our soil is by the years of intensive monocropping and the fertilizer-pesticide double whammies.
And who’s to say that the land will even be available for you to use when push comes to shove?
With all the focus on revolutions and unrest in the Arab world, we shouldn’t forget that there was a military coup in Madagascar last year because the government sold half the arable land in the country to Daewoo, a Korean corporation, so that they could grow food for foreign export.
Similar land grabs are happening all over Africa, from Ethiopia to the Sahel. China is signing long-term supply contracts for oil and grain at an incredible rate and, as a result, this huge exporter ran a trade deficit for the first time ever last year.
In this era of corporate consolidation and government capitulation, especially with all the rhetoric about “efficiency,” it’s not beyond the pale to consider the idea that agribusiness will be engaged to run all food production operations in order to ensure maximum throughput.
Laws such as the pending Food Safety Modernization [sic] Act (S510) in the US, which disproportionately affects small-scale farming operations by burdening them with onerous regulations and requirements and also places all food production facilities within the US under the ultimate jurisdiction of the Department of Homeland Security in the event of “an emergency,” show us that there’s really no iron-clad guarantee that growing your own food is even a viable option in the long-term.
Unless the central governments fall apart…
6. This is the transition. We’re in it now.
More people every year. Less energy, fewer jobs, higher prices.
Big business is consolidating and merging to survive the crisis. Nations are mortgaging their great-grandchildren’s future labor to shore up a system that’s quickly becoming unable to supply even austere levels of social care.
If we had started building a renewable energy infrastructure when Carter was the President of the US and beige was still sexy, we might have made it. But we didn’t.
We traded in fireless cookery, knitwear and board games for McDonalds, IPhones and velour sweatpants with “Bitch” embroidered in sequins on the backside.
This transition will be characterized by unrest as people become disillusioned and then angry with their leaders and their systems.
It will show itself economically in sudden upheavals in markets and national finances. The end game, if there is enough oil to go around and not enough for any one country to fight anyone else over, will be rationing, martial law, curfews and authoritarian rule by surviving political and business interests enforced by the military.
If there’s enough oil to make it worth fighting over, we may find ourselves in an even more unsavory bind, and if the oil crunch comes faster and deeper than we can handle, everything will just fall apart faster.
Libya supplies 2% of the world’s oil and NATO troops are strafing it as I write this.
Upheaval in Egypt and Tunisia, attrition in Bahrain, Syria and Yemen, rumblings in Iraq, Iran, Algeria and Saudi Arabia. Even the famously polite cheeseheads in Wisconsin stormed their state capitol for weeks and recently, a judge threw out Governor Walker’s anti-union bill for the third time.
The Chinese have a curse, which translates as “May you live in interesting times.”
I think we all accept the Transition Equation: Community = Resilience = Good. What I’ve tried to do is point out the cracks in a sloppy, ideological transition rather than a hardy, pragmatic one.
It’s too easy to lose track of how big a part of our best laid plans still rely on the chimera of the fossil fuel economy. When it comes to building a local community around reliable supplies of equitably shared resources, frequently the more we look into it, the more it falls apart.
As Dmitry Orlov is fond of saying, we seem to go to any length to avoid simply getting by with less. Even ardent environmentalists talk with shining eyes about a future of hybrid cars, smart meters and nuclear power.
Continuing our current enterprise by other means is not the same as changing the entire meaning and trajectory of our cultural narrative. If we’re going to make it over the hump, we need to be honest about what the future really holds and how we can face it, armed with a tight-knit community of like-minded individuals and a willingness to dig deeper than the window box.
–Mike Freedman, Transition Voice
If you enjoyed this article please share it and follow us on Facebook.