Thousands of people are probably dead in flooded-out New Orleans, mayor says
06:33 PM EDT Aug 31
BRETT MARTEL
NEW ORLEANS (CP) - Katrina probably killed thousands of people in New Orleans, said Mayor Ray Nagin; an estimate that, if accurate, would make the storm by far the country's deadliest hurricane in more than a century.
"We know there is a significant number of dead bodies in the water," and other people dead in attics, Nagin said. Asked how many, he said: "Minimum, hundreds. Most likely, thousands."
The frightening estimate came as army engineers struggled to plug New Orleans' breached levees with giant sandbags and concrete barriers, while authorities drew up plans to clear out the tens of thousands of people left in the Big Easy and all but abandon the flooded-out city.
There will be a "total evacuation of the city. We have to. The city will not be functional for two or three months," Nagin said.
Most of those storm refugees - 15,000 to 20,000 people - were in the Superdome, which had become hot and stuffy, with broken toilets and nowhere for anyone to bathe. "It can no longer operate as a shelter of last resort," the mayor said.
Nagin estimated 50,000 to 100,000 people remained in New Orleans, a city of nearly half a million people. He said 14,000 to 15,000 a day could be evacuated.
The Pentagon, meanwhile, began mounting one of the largest search-rescue operations in U.S. history, sending four navy ships to the Gulf Coast with drinking water and other emergency supplies, along with the hospital ship USNS Comfort, search helicopters and elite SEAL water-rescue teams. American Red Cross workers from across the country converged on the devastated region in the agency's biggest-ever relief operation.
Canadian politicians and health authorities have offered to send emergency medical supplies to help relief efforts.
The death toll from hurricane Katrina has reached at least 110 in Mississippi alone. But the full magnitude of the disaster had been unclear for days; Louisiana has been putting aside the counting of the dead to concentrate on rescuing the living, many of whom were still trapped on rooftops and in attics.
If the mayor's estimate holds true, it would make Katrina the country's deadliest hurricane since 1900, when a storm in Galveston, Texas, killed between 6,000 and 12,000 people.
A full day after the Big Easy thought it had escaped Katrina's full fury, two levees broke and spilled water into the streets Tuesday, swamping an estimated 80 per cent of the bowl-shaped, below-sea-level city, inundating kilometres and kilometres of homes and rendering much of New Orleans uninhabitable for weeks or months.
"We are looking at 12 to 16 weeks before people can come in," Nagin said on ABC's Good Morning America, "and the other issue that's concerning me is we have dead bodies in the water. At some point in time the dead bodies are going to start to create a serious disease issue."
With the streets awash and looters brazenly cleaning out stores, authorities planned to move at least 25,000 of the New Orlean's storm refugees to the Houston Astrodome, 560 kilometres away, in a vast, two-day convoy of some 475 buses.
Gov. Kathleen Blanco said the situation was desperate and there was no choice but to clear out.
"The logistical problems are impossible and we have to evacuate people in shelters," the governor said. "It's becoming untenable. There's no power. It's getting more difficult to get food and water supplies in, just basic essentials."
Around midday, officials with the state and the Army Corps of Engineers said the water levels between the city and Lake Pontchartrain had equalized, and water had stopped rising in New Orleans, and even appeared to be falling, at least in some places. But the danger was far from over.
The Army Corps of Engineers said it planned to use heavy-duty Chinook helicopters to drop 9,000-kilogram sandbags Wednesday into the 150-metre gap in the failed floodwall. But the agency said it was having trouble getting the sandbags and dozens of 4 1/2-metre highway barriers to the site because the city's waterways were blocked by loose barges, boats and large debris.
Officials said they were also looking at a more audacious plan: finding a barge to plug the hole.
"The challenge is an engineering nightmare," the governor said on ABC's Good Morning America.
As the sense of desperation deepened in New Orleans, hundreds of people wandered up and down Interstate 10, pushing shopping carts, laundry racks, anything they could find to carry their belongings. Dozens of fishermen from up to 300 kilometres away floated in on caravans of boats to pull residents out of flooded neighbourhoods.
On some of the few roads that were still passable, people waved at passing cars with empty water jugs, begging for relief. Hundreds of people appeared to have spent the night on a crippled highway.
In one east New Orleans neighbourhood, refugees were being loaded onto the backs of moving vans like cattle, and in one case emergency workers with a sledgehammer and an axe broke open the back of a mail truck and used it to ferry sick and elderly residents.
Police officers were asking residents to give up any guns they had before they boarded buses and trucks because police desperately needed the firepower: Some officers who had been stranded on the roof of a motel said they were being shot at overnight.
Wednesday, August 31, 2005
Experts: $4 a gallon gas coming soon
Pricing analysts say consumers can expect even higher prices at the pump.
August 31, 2005: 4:11 PM EDT
By Grace Wong, CNN/Money staff writer
NEW YORK (CNN/Money) - Consumers can expect retail gas prices to rise to $4 a gallon soon, but whether they stay there depends on the long-term damage to oil facilities from Hurricane Katrina, oil and gas analysts said Wednesday.
"There's no question gas will hit $4 a gallon," Ben Brockwell, director of pricing at the Oil Price Information Service, said. "The question is how high will it go and how long will it last?"
OPIS tracks wholesale and retail oil prices and provides pricing information for AAA's daily reports on fuel prices.
Brockwell said with gasoline prices now exceeding $3 a gallon before even reaching the wholesale level, it "doesn't take a genius" to expect retail prices to hit $4 a gallon soon.
"Consumers haven't seen the worst of it yet," Brockwell said.
He expects consumers in the Southeast and Northeast to be pinched first, following the impact of Hurricane Katrina on the Gulf Coast region.
Katrina pressures gas supplies
Katrina forced operators to close more than a tenth of the country's refining capacity and a quarter of its oil production, which sent gasoline prices surging.
Two major pipelines that supply gasoline to key terminals and distribution centers within the eastern U.S. were shut down due to power outages caused by the storm. (Video of Energy Secretary Samuel Bodman discussing U.S. plans to tap strategic oil reserve to help refiners -- 4:16. Click here to watch.)
Colonial Pipeline said it hopes to be back in partial operation soon, while the date of Plantation Pipeline's restart is not clear. Each day the pipelines are closed, supplies get backlogged and distribution centers must rely on reserves.
"With this kind of hiccup in refinery capacity, in stretched markets like California, you could see over $4 a gallon in gas," Evan Smith, an analyst at U.S. Global Investors, told CNN/Money.
While it's still too early to fully assess the damage caused by Katrina, efforts to build up inventories of crude oil, natural gas and other products like gasoline will be set back by the storm, according to Nariman Behravesh, chief economist at Global Insight.
In a research note, Behravesh laid out a worst-case scenario that puts average prices for regular unleaded gasoline at about $3.50 a gallon for the next four to six months.
"The impact on consumer spending in such a scenario would be very dramatic, cutting the growth rate by as much as 3 percent and pushing real GDP growth in the fourth quarter closer to zero," he wrote.
In a best-case scenario, he forecast retail pump prices to peak at $3 a gallon for a couple of months, but then fall back to around $2.50 by year-end.
The nationwide average price for a gallon of regular unleaded hit a fresh high of $2.619 Wednesday, according to AAA, the largest U.S. motorist organization, formerly known as the American Automobile Association.
Average gasoline prices have gained 40 percent in the last year.
Prices for crude oil are also up sharply and are currently hovering near record highs just under $70 a barrel.
Pricing analysts say consumers can expect even higher prices at the pump.
August 31, 2005: 4:11 PM EDT
By Grace Wong, CNN/Money staff writer
NEW YORK (CNN/Money) - Consumers can expect retail gas prices to rise to $4 a gallon soon, but whether they stay there depends on the long-term damage to oil facilities from Hurricane Katrina, oil and gas analysts said Wednesday.
"There's no question gas will hit $4 a gallon," Ben Brockwell, director of pricing at the Oil Price Information Service, said. "The question is how high will it go and how long will it last?"
OPIS tracks wholesale and retail oil prices and provides pricing information for AAA's daily reports on fuel prices.
Brockwell said with gasoline prices now exceeding $3 a gallon before even reaching the wholesale level, it "doesn't take a genius" to expect retail prices to hit $4 a gallon soon.
"Consumers haven't seen the worst of it yet," Brockwell said.
He expects consumers in the Southeast and Northeast to be pinched first, following the impact of Hurricane Katrina on the Gulf Coast region.
Katrina pressures gas supplies
Katrina forced operators to close more than a tenth of the country's refining capacity and a quarter of its oil production, which sent gasoline prices surging.
Two major pipelines that supply gasoline to key terminals and distribution centers within the eastern U.S. were shut down due to power outages caused by the storm. (Video of Energy Secretary Samuel Bodman discussing U.S. plans to tap strategic oil reserve to help refiners -- 4:16. Click here to watch.)
Colonial Pipeline said it hopes to be back in partial operation soon, while the date of Plantation Pipeline's restart is not clear. Each day the pipelines are closed, supplies get backlogged and distribution centers must rely on reserves.
"With this kind of hiccup in refinery capacity, in stretched markets like California, you could see over $4 a gallon in gas," Evan Smith, an analyst at U.S. Global Investors, told CNN/Money.
While it's still too early to fully assess the damage caused by Katrina, efforts to build up inventories of crude oil, natural gas and other products like gasoline will be set back by the storm, according to Nariman Behravesh, chief economist at Global Insight.
In a research note, Behravesh laid out a worst-case scenario that puts average prices for regular unleaded gasoline at about $3.50 a gallon for the next four to six months.
"The impact on consumer spending in such a scenario would be very dramatic, cutting the growth rate by as much as 3 percent and pushing real GDP growth in the fourth quarter closer to zero," he wrote.
In a best-case scenario, he forecast retail pump prices to peak at $3 a gallon for a couple of months, but then fall back to around $2.50 by year-end.
The nationwide average price for a gallon of regular unleaded hit a fresh high of $2.619 Wednesday, according to AAA, the largest U.S. motorist organization, formerly known as the American Automobile Association.
Average gasoline prices have gained 40 percent in the last year.
Prices for crude oil are also up sharply and are currently hovering near record highs just under $70 a barrel.
Tuesday, August 30, 2005
No. 148 - July 2004
by Richard Heinberg
Boomers' Last Chance?
(We encourage you to get books through your local bookstore or from your library. If this is not practical, ordering through our links provides Museletter with a small commission. Book links are to Powell's or, if unavailable there, Amazon. These links are also useful to find out more about the book: price, content and reviews.)
In his best-selling 1998 book The Greatest Generation, Tom Brokaw extolled the virtues of the American women and men, now deep into their retirement years, who grew up during the Great Depression and fought in World War II. Brokaw's book drew an implied contrast between "the greatest generation any society ever produced" and those that preceded and followed it. The cohort born during World War I and up to 1930 faced immense adversity and made sacrifices that ensured the survival of freedom and democracy; as a result, their children have enjoyed the most extended and exuberant period of affluence in the history of any nation.
Brokaw and I are children of that generation; ours is the so-called Baby Boom generation, about which an oil tanker's worth of ink has been spilled in self-adulation, self-criticism, self-analysis, and general self-obsession. I hesitate to join in the orgy of demographic mirror gazing, but lately I've begun to reflect on a simple fact: during my lifetime - and that of my cohort - about half of the non-renewable resources of the planet will have been used. Gone, forever.
This is a generation that has practised diachronic competition (that is, competition with future generations) more ruthlessly than has any other since the dawn of our species. The implications are devastating.
I might dispute Brokaw's assertion that the World War II generation was the best in history (in fact I will do so below); nevertheless, a good case could be made that my generation, because it so threatens the perpetuation of its kind and the survival of countless other species, is the worst ever.
Mea culpa
Of course, in a way the very idea of a "generation" is arbitrary. The notion implies uniformity where there is endless diversity, discreteness where there is continuity. Worse still, discussion of "better" or "worse" generations entails a moral judgment, as though all of the members of a demographic cohort somehow deserve equal praise or blame, when in fact this is never the case. Who is the exemplary Boomer - Karl Rove or Ron Kovics? Laura Bush or Amy Goodman? It may make sense to speak of the moral triumphs or failures of individuals, but the application of such judgments to whole generations is problematic.
However there is one respect in which the discussion has merit: Much of Brokaw's argument (if it can be called that) revolves around the truism that a demographic cohort is shaped by historical circumstances. Individuals within that cohort inevitably respond to events differently and help shape subsequent history in divergent ways, yet members of each generation undeniably share a certain commonality of experience - notably so during periods of large-scale, dramatic change.
Brokaw's "greatest generation" was tempered by adversity. In contrast, the Boomers have been spoiled by abundance. One generation presided over America's ascendancy while the other is overseeing its peak in power and wealth and its inevitable decline.
That's the conventional-wisdom summary of the situation, but it is in many ways a misleading one: a closer look might reveal that the World War II generation was not so praiseworthy after all, nor are the Boomers uniformly culpable. All of us are mostly responding to circumstances beyond our control.
In this essay I hope to explore some of the circumstances that have made us Boomers what and who we are, and to argue that, having failed to live up to some of our expressed ideals and now finding ourselves in power just as the industrial world is beginning its inevitable decline, Boomers may have one last opportunity to redeem themselves.
What Made the "Greatest Generation" Great
Brokaw's book was in some respects a peace offering - an attempt to close the generation gap that opened up in the 1960s as young people wrangled with their parents over drugs, sex, music, hairstyles, and the Vietnam War. Steven Spielberg's Saving Private Ryan was perhaps another bouquet thrown from the younger (now aging) generation to its elders. The message implicit in both: We, the Boomers, appreciate and respect our parents' sacrifices and hard work, which made it possible for us to enjoy the peace, freedom, and affluence that we have mostly taken for granted throughout our lives.
The bouquet is perhaps deserved - no doubt so in many individual instances. The Greatest Generation is filled with stories of undeniable heroism (for more politically informed anecdotal reports of the experiences and contributions of the elder cohort see Studs Terkel's Hard Times: An Oral History of the Great Depression, published by Norton in 2000, and The Good War: An Oral History of World War II, released by New Press in 1997).
However, the freedom and affluence of modern Americans are due not just to courage and endurance but also sheer luck. Let us not forget that the people who inhabited the United States in the early 20th century happened to be sitting on one fabulous pile of natural resources - everything from forests, fresh water, fertile soils, and fish to minerals (gold, nickel, iron, aluminum, copper) to energy resources (oil, natural gas, coal, and uranium). Moreover, the US has enjoyed a geographic isolation from Eurasian intrigues, which enabled it to thrive during occasions when Europeans were tearing each other to bits.
Thus the payoff that came at the end of World War II carried an historic inevitability: with its resource base, factories, and highly motivated work force, the US had won the war without damage to its internal infrastructure. In contrast, Britain and the USSR had also emerged winners, but only after having seen their cities, railroads, and factories bombed. While the rest of the industrial world lay in ruins, America stood unscathed.
Because of the American economy's stability, the US dollar was adopted as a reserve currency by other nations. American oil wells were then supplying over half the total amount of petroleum being extracted globally. Sixty percent of all export goods delivered throughout the world carried a "Made in USA" tag. General Motors was the world's biggest corporation and Hollywood films were on screens everywhere.
US factories made so many manufactured goods that Americans had to be cajoled into a permanent buying frenzy by the greatest propaganda system the world has ever seen - the American advertising industry - which made brilliant use of history's greatest propaganda medium - television. In fact, the consumerist project had gotten under way in the 1920s as fuel-fed American capitalism searched for solutions to the problem of over-production (a problem that was in fact one of the Depression's causes). But World War II's insatiable need for materiel and the post-war expansion of advertising and credit made the Depression vanish like a bad dream and sent the economy into warp drive. Indeed, in the 1950s human beings habitually came to be referred to not as "people" or "citizens," but as "consumers."
Having lived through a decade when starving would-be employees competed for the few jobs available, people worked hard when finally given the chance. They saved. They believed in the American Dream and in the essential goodness of America's international leadership. They bought homes and raised families.
And that's where the Boomers come in.
The "Me" Generation
When people feel optimistic about the future they tend to have more children. And so, after the War's end, as soldiers came home and went to work building the suburban utopia, they sired the most numerous generational cohort America had ever seen. Demographers define baby-boomers as those born between 1946 and 1964 (as of 2004, members of the Boomer cohort are between 40 and 58 years of age). There are about 76 million US Boomers, representing over a quarter of the population. And their tastes, lifestyles, and ambitions have transformed the nation - and to a large extent the world beyond - in a myriad of ways.
The "Father Knows Best" years in which the Boomers grew up were ones of unprecedented abundance and safety. Yes, there was a Cold War, there were a couple of recessions, and the last few of the Boomer cohort's formative years (from 1968 on) were tumultuous. But compare this quarter-century to any previous one in history: in Europe - one of the wealthiest regions of the planet - hardly a decade went by for centuries without a significant famine affecting an entire region. For Boomers the word famine held about as much personal relevance as Bible verses about leprosy or marauding Philistines. No one in America actually starved to death - at least not in modern times, and certainly no one we knew. Far from it: Boomers knew only supermarkets filled with cheap, packaged, refrigerated foods in a numbing variety, all conveniently accessed by way of automobiles (every family now had one) rolling serenely over smoothly paved streets and highways.
One measure of this new abundance was power available per-capita. In the 19th century, most of the work being done in America was accomplished by means of animal or human muscle-power. In 1850, fuel-fed machines supplied only about 18 percent of the total horsepower in the economy; the rest came from horses, oxen, and human labor. Domestic servants were common. However, by 1960 machines were supplying virtually all of the power in the economy. People were still working, of course, and there were lots more of them (though by now there were far fewer working horses, and far fewer domestic servants), but their contribution had become inconsequential in terms of applied energy. Machines - and the fossil fuels that made them go - were supplying power for greatly expanded manufacturing, transportation, information storage and transmission, and so on. And so by the 1960s the typical American - even if his or her near ancestors had been slaves or servants - had access to power equivalent to that exerted by scores of laborers: it was as though each citizen could command a small army of "energy slaves."
In short, Americans had every reason to believe that they were living in the best of all possible worlds, in the greatest of nations, in the best of times.
Why, then, the generation gap? Was there trouble in paradise?
Again: people are to some extent the product of the circumstances and events of their historical era. The younger generation, growing up in affluence, was freed to take survival - even abundance - for granted. And we are discussing a level of abundance significantly greater, in some respects, even than exists today: at that time, the US was still solvent, still a net exporter of credit. In the 1960s an entire family could live on a single average income. Rents were cheap, land was cheap, and college was cheap.
Therefore rebellion was cheap, too. The young people knew they were different from their parents (though they usually couldn't articulate how or why). They could afford to question their parents' seeming obsession with discipline and hard work, their conformity and unflinching patriotism.
Meanwhile America was visibly and quickly changing: graceful old downtown buildings were collapsing under the wrecking ball while monotonous suburban housing developments and strip malls were sprouting where farmland used to be. America's wealth was being spent in a tasteless nouveau-riche spectacle designed by bored and overpaid Madison Avenue huckster-bureaucrats in gray suits. The older generation was mostly proud of this transformation, but many youth couldn't help but notice the vapidity and emptiness of the corporate-sponsored theme-park way of life and had the free time to indulge in irony and sarcasm.
As young people went to college (a greater percentage of them did so than in any previous generation) they started asking questions, and the answers they found were troubling. They learned that the shining image of America the Free and Brave hid a history of slavery and genocide. Moreover, in their extracurricular reading they discovered that an increasing share of US wealth was emanating from an international imperial system enforced by the American military and the CIA.
This latter fact was driven home by the greatest single perception-shaping circumstance of the Boomers' young-adult lives - the Vietnam War. Pampered American teenagers were being called up, trained, and airlifted around the world to fight and die in a conflict they didn't understand. And an alarming number of them were coming home in pine boxes. Was this a heroic campaign against a malevolent foreign enemy bent on our destruction? Or was it an imperialist war of aggression on a Third-World nation led by a man widely regarded as his country's equivalent of George Washington? Disputes over the War divided families across America - my own included - and ran deep: for people on both sides of the debate what was at stake was nothing less than the essential character and future of the nation.
The Boomers' Defining Moments
Many of the happily memorable moments of the Boomer generation's early years are etched into the national psyche and have been recalled endlessly: teenage girls' shrieking response to the Beatles' first appearance on the Ed Sullivan Show; the Summer of Love in San Francisco in 1967; Grateful Dead concerts jammed with tripping, giddy hipsters; communes and head shops; Woodstock. But other images are more sobering: the assassinations of JFK, RFK, and Martin Luther King; the police riot at the 1968 Democratic Convention; the shootings at Kent State; the stirring to life of the Black Power movement, the American Indian Movement, the women's movement, and the Chicano/farm workers' movement; and the massive antiwar demonstrations that closed many colleges and universities in 1971.
However, the two events of that era that had the potential to most profoundly shape the remainder of the Boomers' lives, and that of their children, are less often dwelt upon. Both occurred in 1970: the peak in US oil production and the first Earth Day.
At the time it happened, the US oil production peak went unnoticed; it was observed in hindsight a couple of years later, though even today it is scarcely mentioned in the press. One of the few who really understood its significance was the scientist who had anticipated it - geologist M. King Hubbert. Its consequences for the US economy and for global geopolitics would only gradually reveal themselves, with the first strong hint appearing in 1973's Arab oil embargo. Those consequences will eventually include the undermining of the entire American consumerist-imperialist project.
Of course oil was and is central to the automobile and airline industries, which have been major drivers of the US economy. Less obvious is oil's role in modern industrial agriculture. However, if one looks more deeply, the very fabric of 20th century America is petroleum-soaked. In 1900 the world's wealthiest and oiliest man was John D. Rockefeller, whose company, Standard Oil, had cornered the national market. Rockefeller himself was an abstemious churchgoer who believed that wealth was a sign of God's favor; what does such a person do with so much money? All sorts of things! Why not go into banking in order to make even more money? The Rockefeller family did so with a vengeance and was instrumental in creating the Federal Reserve System - the banking cartel that quietly controls the US currency and economy. If one is exceptionally wealthy it is also handy to have some influence over public opinion - and so Rockefeller wealth found its way into controlling positions in media organizations. Even scientific research can have its uses: when I was researching the history of genetic engineering for my 1999 book Cloning the Buddha, my most troubling discovery was that the inception of molecular biology (the basis for all subsequent developments in genetic science) came in the 1920s as a result of strategic grants from the Rockefeller Foundation in its quest for a means of eugenic "social control." Politics, geopolitics, war, weapons manufacturing, education - all were deeply impacted by the Rockefeller oil fortune. Oil wasn't just a subsidy to American wealth; it had come to be the very substance of American wealth.
Therefore the fact that by 1971 US oil production had peaked and was in terminal decline was momentous (if unheralded) news. America could no longer be a source of wealth in the same way it had been; if it were to maintain its privileged position globally it would have to become the world's moneychanger, banker, landlord, stockbroker . . . and enforcer. American military force would have to be used increasingly to safeguard and protect US access to the resource wealth of other countries, while international trade agreements would have to be written and enforced to the advantage of American corporations. And those corporations would be ever less involved directly in manufacturing, but more in trading, branding, and licensing.
The other signal event of 1970 - the first Earth Day - was well noted at the time. The brainchild of Senator Gaylord Nelson, Earth Day was reported prominently in the New York Times, Time Magazine, and most other significant media outlets. Legislation followed: the National Environmental Policy Act, the Clean Air Act, the Water Quality Improvement Act, the Water Pollution and Control Act Amendments, the Resource Recovery Act, the Resource Conservation and Recovery Act, the Toxic Substances Control Act, the Occupational Safety and Health Act, the Federal Environmental Pesticide Control Act, the Endangered Species Act, the Safe Drinking Water Act, the Federal Land Policy and Management Act, and the Surface Mining Control and Reclamation Act.
Perhaps even more important than this legislation was the symbolic value of the occasion in giving voice and identity to a growing minority who viewed the fossil-fueled industrial project as having dire consequences for humanity and nature, and who advocated a dramatic change of direction for society as a whole away from consumerism and toward conservation, away from militarism and toward nurturance of life. The Earth Day message - which would be given renewed force two years later with the publication of the Club of Rome report, The Limits to Growth, and then again with the Arab oil embargo of 1973 - appealed to many young people's intuitive longing for a return to a simpler, more localized and agrarian version of America, an America that didn't meddle in other nations' affairs.
The Earth Day message might have been still more compelling had Americans been aware of the fact and significance of their nation's oil peak. However, though the message evoked legislative and cultural responses, it sank in only so deep. It was, after all, difficult for many Americans to accept the notion that they should voluntarily give up their material privileges, their control of global resource streams, their entitlement to a glittering technotopian future of effortless abundance, and accept instead a self-disciplined and self-limiting future of hard work and dwindling material aspirations. The difficulty was compounded by the existence of an international rival - the USSR - that would presumably fill the void if America were to shrink from its imperial duties. The Soviet Union was also a competitor in the oil business and had actually out-produced the US in recent years. Wouldn't stepping off the consumerist treadmill mean giving in to the Commies?
It was a contest of visions and values, and that contest was to be decided in the election of 1980.
The Path Taken
Jimmy Carter was far from being a perfect president (his national security advisor, Zbigniew Brzezinski, was positively Machiavellian); nevertheless he somewhat understood the Earth Day message. I was living in Canada during the mid-1970s and almost never watched television, but I somehow found myself viewing a Carter speech in which he told Americans that they would have to change their material way of life in order to keep their freedoms. I was so amazed to hear an American president saying such things that I moved back to the US. But the Carter years were destined to be few.
For over three decades the American Right had been searching for ways to overturn the New Deal. Corporate leaders backing the Republicans had managed to make common cause with the burgeoning Christian fundamentalist movement and the anti-Communist fringe; Nixon had perfected the Southern strategy; and the party had found its perfect pitchman - a former film star and ex-shill for General Electric. Ronald Reagan and the Republican PR machine pushed all of the right buttons, even resorting to an "October surprise" to manipulate the Iranian hostage crisis to their benefit.
Reagan and G. H. W. Bush (who, during the mid-1980s, may have been the de facto president) were the last US leaders of the World War II generation, their cohort's final gift to the nation. It was morning in America, but let the Earth be damned: the Republicans had found an electoral strategy so successful that Democrats began trying to copy it, so that since 1980 the entire US political system has lurched ever further toward increased economic inequality, globalization, imperialism, and militarism.
So what did the Boomers do after 1980?
Having already taken a detour into the bleary world of recreational drugs, many of the more spirited Boomers now turned to gurus, meditation, and cults: politics was a bummer; if we really wanted to change the world we should change our heads first.
Other Boomers steered toward the stock market and scrambled up the corporate ladder. They got jobs, made money, and discovered that "greed is good." By the end of the decade it was apparent the Boomers were divided, with some upholding the Earth Day vision, others honing their skills as right-wing radio talk show hosts, and the rest just trying to get by.
Another Fork in the Road
Bill Clinton, the first Boomer president (born in 1946), elicited high hopes among his generational peers feeling battered by a dozen years of Reagan/Bush. But as governor of Arkansas Clinton had already learned the necessity of obeying entrenched power-holders in order to get along in politics. Moreover, by now the American governmental-corporate system was far too large and complex, and had far too much momentum behind it, to permit a fundamental change in direction.
In the late 1960s and early '70s many of us had believed that when our generation eventually took over the reins of power we would change the world. Well, here we were with one of our cohort as president and the country was more deeply mired than ever in the banality of consumerism. The WWII generation was increasingly filling obituary pages and populating nursing homes; now we had no one to blame but ourselves. The generation of peace and love had become the generation of SUVs and fast food.
It was clear that we had deluded ourselves by thinking of our cohort as united in its values, or by imagining that those values were somehow immutable. Just as Brokaw's "greatest generation" had started out in the 1930s battling the evils of unrestrained capitalism and went on in the 1940s to fight the menace of fascism only to end by electing Nixon, Reagan, and Bush and supporting the Vietnam war, we were now doing something similar.
This is not to say that all of our number had sold out: we could count as generational heroes and heroines thousands of scientists, activists, artists, musicians, and writers who kept alive the Earth Day ideal of a society that lives in harmony with nature rather than parasitically destroying it. However, with each passing year that ideal seemed ever more elusive - especially so following the 2000 election.
We watched as that election was stolen, and our outrage only grew as we saw prominent Democrats quietly acquiescing to the evisceration of what was left of American democracy. The events of 9/11 jolted even the drowsiest awake, and some of us began paying attention as never before when we realized that mainstream news organizations were failing to ask the most obvious questions about the events - about the mysterious collapse of the towers, the failure of officials to dispatch jet fighters, the immediate confiscation and destruction of evidence, the suspicious airline stock trades, the thwarted warnings, and much more. With the invasions of Afghanistan and Iraq, the detentions in Guantanamo, and the passage of the USA Patriot Act, it became clear that the US had entered an entirely new historical period. The current pseudo-president was another Boomer, but his shortcomings didn't end with corruption and simple-mindedness: he was, in the words of George Washington University psychiatrist Dr. Justin Frank, "an untreated alcoholic with paranoid and megalomaniac tendencies," and his cronies were evidently dedicated neo-fascists with every intention of turning America into a Disneyland Reich. That they were ridiculously inept made them all the more dangerous.
In response, in recent months, some Boomers have honed their political consciousness. Michael Moore has most publicly led the way in this regard, but Cynthia McKinney, Michael Ruppert, and Catherine Austin Fitts are perhaps more emblematic of the leading edge of this reinvigorated political awareness and commitment.
With the 2004 election season the two poles of the Boomer generation are facing off over America's future, and that of the world. But this is to be no ordinary election. There is little chance today of any broad public discussion of the real issue that will impact our lives in the next few years - that the generation that grew up expecting always more will soon be faced with less. The nation, now hallucinating uncontrollably from toxic exposure to Fox News, is in debt to the point that no conceivable decision made today will prevent a devastating implosion of the US economy. Global oil production is going to peak before 2010. And the election itself may already be rigged, with remotely programmable electronic voting machines in place in the few strategic counties that can deliver the needed Electoral College tally.
It may seem cynical to some if I say that it is too late to salvage America's political system, its economy, its suburban way of life; that it is even too late to contemplate an easy and peaceful transition to a different socio-ecological reality - that possibility probably died in 1980. But as far as I can tell, these are the facts. As they say these days, get over it.
This doesn't mean that life will end tomorrow. The American dream is going down, yet we still have some control over how it goes down. And it is in this remaining arena of choice that we Boomers might partially redeem ourselves.
While our current struggle is not entirely defined by the project of trying to elect John Kerry (whose policies are "Bush Lite" in many respects), the expulsion of Bush and the neocons from power is a necessary immediate goal.
But there is a far more momentous long-term test ahead. During the next two decades we Boomers will assume the role of elders. We will have amassed considerable financial capital, as well as human capital in the forms of competence, credibility, and connections. How will we use this capital?
If we use it for any purpose other than to help awaken all and sundry to our collective plight, and to lead a change of course toward a peaceful, local, slow, and self-limiting post-fossil-fuel way of life, it will all have been wasted.
In the decades ahead we will be going through hell. That is an awful thing to contemplate, but the only alternative to accepting the fact is to live in denial until the reality is inescapable and our room for maneuvering is even more restricted than it has already become. What we must do now is to lay the groundwork for collective survival. We must build lifeboats, or support the younger lifeboat-builders among us.
This is not the grandiose project we imagined for ourselves back in the 1960s and '70s. Maybe people who are around decades from now will again be able to contemplate the creation of ecotopia - let us hope so. We Boomers have stolen much from those future generations; the main question remaining is, can we now give back at least the possibility that those generations will be permitted to exist?
If you wish to republish any of these essays or post them on a web site, please contact rheinberg@museletter.com for permission.
by Richard Heinberg
Boomers' Last Chance?
(We encourage you to get books through your local bookstore or from your library. If this is not practical, ordering through our links provides Museletter with a small commission. Book links are to Powell's or, if unavailable there, Amazon. These links are also useful to find out more about the book: price, content and reviews.)
In his best-selling 1998 book The Greatest Generation, Tom Brokaw extolled the virtues of the American women and men, now deep into their retirement years, who grew up during the Great Depression and fought in World War II. Brokaw's book drew an implied contrast between "the greatest generation any society ever produced" and those that preceded and followed it. The cohort born during World War I and up to 1930 faced immense adversity and made sacrifices that ensured the survival of freedom and democracy; as a result, their children have enjoyed the most extended and exuberant period of affluence in the history of any nation.
Brokaw and I are children of that generation; ours is the so-called Baby Boom generation, about which an oil tanker's worth of ink has been spilled in self-adulation, self-criticism, self-analysis, and general self-obsession. I hesitate to join in the orgy of demographic mirror gazing, but lately I've begun to reflect on a simple fact: during my lifetime - and that of my cohort - about half of the non-renewable resources of the planet will have been used. Gone, forever.
This is a generation that has practised diachronic competition (that is, competition with future generations) more ruthlessly than has any other since the dawn of our species. The implications are devastating.
I might dispute Brokaw's assertion that the World War II generation was the best in history (in fact I will do so below); nevertheless, a good case could be made that my generation, because it so threatens the perpetuation of its kind and the survival of countless other species, is the worst ever.
Mea culpa
Of course, in a way the very idea of a "generation" is arbitrary. The notion implies uniformity where there is endless diversity, discreteness where there is continuity. Worse still, discussion of "better" or "worse" generations entails a moral judgment, as though all of the members of a demographic cohort somehow deserve equal praise or blame, when in fact this is never the case. Who is the exemplary Boomer - Karl Rove or Ron Kovics? Laura Bush or Amy Goodman? It may make sense to speak of the moral triumphs or failures of individuals, but the application of such judgments to whole generations is problematic.
However there is one respect in which the discussion has merit: Much of Brokaw's argument (if it can be called that) revolves around the truism that a demographic cohort is shaped by historical circumstances. Individuals within that cohort inevitably respond to events differently and help shape subsequent history in divergent ways, yet members of each generation undeniably share a certain commonality of experience - notably so during periods of large-scale, dramatic change.
Brokaw's "greatest generation" was tempered by adversity. In contrast, the Boomers have been spoiled by abundance. One generation presided over America's ascendancy while the other is overseeing its peak in power and wealth and its inevitable decline.
That's the conventional-wisdom summary of the situation, but it is in many ways a misleading one: a closer look might reveal that the World War II generation was not so praiseworthy after all, nor are the Boomers uniformly culpable. All of us are mostly responding to circumstances beyond our control.
In this essay I hope to explore some of the circumstances that have made us Boomers what and who we are, and to argue that, having failed to live up to some of our expressed ideals and now finding ourselves in power just as the industrial world is beginning its inevitable decline, Boomers may have one last opportunity to redeem themselves.
What Made the "Greatest Generation" Great
Brokaw's book was in some respects a peace offering - an attempt to close the generation gap that opened up in the 1960s as young people wrangled with their parents over drugs, sex, music, hairstyles, and the Vietnam War. Steven Spielberg's Saving Private Ryan was perhaps another bouquet thrown from the younger (now aging) generation to its elders. The message implicit in both: We, the Boomers, appreciate and respect our parents' sacrifices and hard work, which made it possible for us to enjoy the peace, freedom, and affluence that we have mostly taken for granted throughout our lives.
The bouquet is perhaps deserved - no doubt so in many individual instances. The Greatest Generation is filled with stories of undeniable heroism (for more politically informed anecdotal reports of the experiences and contributions of the elder cohort see Studs Terkel's Hard Times: An Oral History of the Great Depression, published by Norton in 2000, and The Good War: An Oral History of World War II, released by New Press in 1997).
However, the freedom and affluence of modern Americans are due not just to courage and endurance but also sheer luck. Let us not forget that the people who inhabited the United States in the early 20th century happened to be sitting on one fabulous pile of natural resources - everything from forests, fresh water, fertile soils, and fish to minerals (gold, nickel, iron, aluminum, copper) to energy resources (oil, natural gas, coal, and uranium). Moreover, the US has enjoyed a geographic isolation from Eurasian intrigues, which enabled it to thrive during occasions when Europeans were tearing each other to bits.
Thus the payoff that came at the end of World War II carried an historic inevitability: with its resource base, factories, and highly motivated work force, the US had won the war without damage to its internal infrastructure. In contrast, Britain and the USSR had also emerged winners, but only after having seen their cities, railroads, and factories bombed. While the rest of the industrial world lay in ruins, America stood unscathed.
Because of the American economy's stability, the US dollar was adopted as a reserve currency by other nations. American oil wells were then supplying over half the total amount of petroleum being extracted globally. Sixty percent of all export goods delivered throughout the world carried a "Made in USA" tag. General Motors was the world's biggest corporation and Hollywood films were on screens everywhere.
US factories made so many manufactured goods that Americans had to be cajoled into a permanent buying frenzy by the greatest propaganda system the world has ever seen - the American advertising industry - which made brilliant use of history's greatest propaganda medium - television. In fact, the consumerist project had gotten under way in the 1920s as fuel-fed American capitalism searched for solutions to the problem of over-production (a problem that was in fact one of the Depression's causes). But World War II's insatiable need for materiel and the post-war expansion of advertising and credit made the Depression vanish like a bad dream and sent the economy into warp drive. Indeed, in the 1950s human beings habitually came to be referred to not as "people" or "citizens," but as "consumers."
Having lived through a decade when starving would-be employees competed for the few jobs available, people worked hard when finally given the chance. They saved. They believed in the American Dream and in the essential goodness of America's international leadership. They bought homes and raised families.
And that's where the Boomers come in.
The "Me" Generation
When people feel optimistic about the future they tend to have more children. And so, after the War's end, as soldiers came home and went to work building the suburban utopia, they sired the most numerous generational cohort America had ever seen. Demographers define baby-boomers as those born between 1946 and 1964 (as of 2004, members of the Boomer cohort are between 40 and 58 years of age). There are about 76 million US Boomers, representing over a quarter of the population. And their tastes, lifestyles, and ambitions have transformed the nation - and to a large extent the world beyond - in a myriad of ways.
The "Father Knows Best" years in which the Boomers grew up were ones of unprecedented abundance and safety. Yes, there was a Cold War, there were a couple of recessions, and the last few of the Boomer cohort's formative years (from 1968 on) were tumultuous. But compare this quarter-century to any previous one in history: in Europe - one of the wealthiest regions of the planet - hardly a decade went by for centuries without a significant famine affecting an entire region. For Boomers the word famine held about as much personal relevance as Bible verses about leprosy or marauding Philistines. No one in America actually starved to death - at least not in modern times, and certainly no one we knew. Far from it: Boomers knew only supermarkets filled with cheap, packaged, refrigerated foods in a numbing variety, all conveniently accessed by way of automobiles (every family now had one) rolling serenely over smoothly paved streets and highways.
One measure of this new abundance was power available per-capita. In the 19th century, most of the work being done in America was accomplished by means of animal or human muscle-power. In 1850, fuel-fed machines supplied only about 18 percent of the total horsepower in the economy; the rest came from horses, oxen, and human labor. Domestic servants were common. However, by 1960 machines were supplying virtually all of the power in the economy. People were still working, of course, and there were lots more of them (though by now there were far fewer working horses, and far fewer domestic servants), but their contribution had become inconsequential in terms of applied energy. Machines - and the fossil fuels that made them go - were supplying power for greatly expanded manufacturing, transportation, information storage and transmission, and so on. And so by the 1960s the typical American - even if his or her near ancestors had been slaves or servants - had access to power equivalent to that exerted by scores of laborers: it was as though each citizen could command a small army of "energy slaves."
In short, Americans had every reason to believe that they were living in the best of all possible worlds, in the greatest of nations, in the best of times.
Why, then, the generation gap? Was there trouble in paradise?
Again: people are to some extent the product of the circumstances and events of their historical era. The younger generation, growing up in affluence, was freed to take survival - even abundance - for granted. And we are discussing a level of abundance significantly greater, in some respects, even than exists today: at that time, the US was still solvent, still a net exporter of credit. In the 1960s an entire family could live on a single average income. Rents were cheap, land was cheap, and college was cheap.
Therefore rebellion was cheap, too. The young people knew they were different from their parents (though they usually couldn't articulate how or why). They could afford to question their parents' seeming obsession with discipline and hard work, their conformity and unflinching patriotism.
Meanwhile America was visibly and quickly changing: graceful old downtown buildings were collapsing under the wrecking ball while monotonous suburban housing developments and strip malls were sprouting where farmland used to be. America's wealth was being spent in a tasteless nouveau-riche spectacle designed by bored and overpaid Madison Avenue huckster-bureaucrats in gray suits. The older generation was mostly proud of this transformation, but many youth couldn't help but notice the vapidity and emptiness of the corporate-sponsored theme-park way of life and had the free time to indulge in irony and sarcasm.
As young people went to college (a greater percentage of them did so than in any previous generation) they started asking questions, and the answers they found were troubling. They learned that the shining image of America the Free and Brave hid a history of slavery and genocide. Moreover, in their extracurricular reading they discovered that an increasing share of US wealth was emanating from an international imperial system enforced by the American military and the CIA.
This latter fact was driven home by the greatest single perception-shaping circumstance of the Boomers' young-adult lives - the Vietnam War. Pampered American teenagers were being called up, trained, and airlifted around the world to fight and die in a conflict they didn't understand. And an alarming number of them were coming home in pine boxes. Was this a heroic campaign against a malevolent foreign enemy bent on our destruction? Or was it an imperialist war of aggression on a Third-World nation led by a man widely regarded as his country's equivalent of George Washington? Disputes over the War divided families across America - my own included - and ran deep: for people on both sides of the debate what was at stake was nothing less than the essential character and future of the nation.
The Boomers' Defining Moments
Many of the happily memorable moments of the Boomer generation's early years are etched into the national psyche and have been recalled endlessly: teenage girls' shrieking response to the Beatles' first appearance on the Ed Sullivan Show; the Summer of Love in San Francisco in 1967; Grateful Dead concerts jammed with tripping, giddy hipsters; communes and head shops; Woodstock. But other images are more sobering: the assassinations of JFK, RFK, and Martin Luther King; the police riot at the 1968 Democratic Convention; the shootings at Kent State; the stirring to life of the Black Power movement, the American Indian Movement, the women's movement, and the Chicano/farm workers' movement; and the massive antiwar demonstrations that closed many colleges and universities in 1971.
However, the two events of that era that had the potential to most profoundly shape the remainder of the Boomers' lives, and that of their children, are less often dwelt upon. Both occurred in 1970: the peak in US oil production and the first Earth Day.
At the time it happened, the US oil production peak went unnoticed; it was observed in hindsight a couple of years later, though even today it is scarcely mentioned in the press. One of the few who really understood its significance was the scientist who had anticipated it - geologist M. King Hubbert. Its consequences for the US economy and for global geopolitics would only gradually reveal themselves, with the first strong hint appearing in 1973's Arab oil embargo. Those consequences will eventually include the undermining of the entire American consumerist-imperialist project.
Of course oil was and is central to the automobile and airline industries, which have been major drivers of the US economy. Less obvious is oil's role in modern industrial agriculture. However, if one looks more deeply, the very fabric of 20th century America is petroleum-soaked. In 1900 the world's wealthiest and oiliest man was John D. Rockefeller, whose company, Standard Oil, had cornered the national market. Rockefeller himself was an abstemious churchgoer who believed that wealth was a sign of God's favor; what does such a person do with so much money? All sorts of things! Why not go into banking in order to make even more money? The Rockefeller family did so with a vengeance and was instrumental in creating the Federal Reserve System - the banking cartel that quietly controls the US currency and economy. If one is exceptionally wealthy it is also handy to have some influence over public opinion - and so Rockefeller wealth found its way into controlling positions in media organizations. Even scientific research can have its uses: when I was researching the history of genetic engineering for my 1999 book Cloning the Buddha, my most troubling discovery was that the inception of molecular biology (the basis for all subsequent developments in genetic science) came in the 1920s as a result of strategic grants from the Rockefeller Foundation in its quest for a means of eugenic "social control." Politics, geopolitics, war, weapons manufacturing, education - all were deeply impacted by the Rockefeller oil fortune. Oil wasn't just a subsidy to American wealth; it had come to be the very substance of American wealth.
Therefore the fact that by 1971 US oil production had peaked and was in terminal decline was momentous (if unheralded) news. America could no longer be a source of wealth in the same way it had been; if it were to maintain its privileged position globally it would have to become the world's moneychanger, banker, landlord, stockbroker . . . and enforcer. American military force would have to be used increasingly to safeguard and protect US access to the resource wealth of other countries, while international trade agreements would have to be written and enforced to the advantage of American corporations. And those corporations would be ever less involved directly in manufacturing, but more in trading, branding, and licensing.
The other signal event of 1970 - the first Earth Day - was well noted at the time. The brainchild of Senator Gaylord Nelson, Earth Day was reported prominently in the New York Times, Time Magazine, and most other significant media outlets. Legislation followed: the National Environmental Policy Act, the Clean Air Act, the Water Quality Improvement Act, the Water Pollution and Control Act Amendments, the Resource Recovery Act, the Resource Conservation and Recovery Act, the Toxic Substances Control Act, the Occupational Safety and Health Act, the Federal Environmental Pesticide Control Act, the Endangered Species Act, the Safe Drinking Water Act, the Federal Land Policy and Management Act, and the Surface Mining Control and Reclamation Act.
Perhaps even more important than this legislation was the symbolic value of the occasion in giving voice and identity to a growing minority who viewed the fossil-fueled industrial project as having dire consequences for humanity and nature, and who advocated a dramatic change of direction for society as a whole away from consumerism and toward conservation, away from militarism and toward nurturance of life. The Earth Day message - which would be given renewed force two years later with the publication of the Club of Rome report, The Limits to Growth, and then again with the Arab oil embargo of 1973 - appealed to many young people's intuitive longing for a return to a simpler, more localized and agrarian version of America, an America that didn't meddle in other nations' affairs.
The Earth Day message might have been still more compelling had Americans been aware of the fact and significance of their nation's oil peak. However, though the message evoked legislative and cultural responses, it sank in only so deep. It was, after all, difficult for many Americans to accept the notion that they should voluntarily give up their material privileges, their control of global resource streams, their entitlement to a glittering technotopian future of effortless abundance, and accept instead a self-disciplined and self-limiting future of hard work and dwindling material aspirations. The difficulty was compounded by the existence of an international rival - the USSR - that would presumably fill the void if America were to shrink from its imperial duties. The Soviet Union was also a competitor in the oil business and had actually out-produced the US in recent years. Wouldn't stepping off the consumerist treadmill mean giving in to the Commies?
It was a contest of visions and values, and that contest was to be decided in the election of 1980.
The Path Taken
Jimmy Carter was far from being a perfect president (his national security advisor, Zbigniew Brzezinski, was positively Machiavellian); nevertheless he somewhat understood the Earth Day message. I was living in Canada during the mid-1970s and almost never watched television, but I somehow found myself viewing a Carter speech in which he told Americans that they would have to change their material way of life in order to keep their freedoms. I was so amazed to hear an American president saying such things that I moved back to the US. But the Carter years were destined to be few.
For over three decades the American Right had been searching for ways to overturn the New Deal. Corporate leaders backing the Republicans had managed to make common cause with the burgeoning Christian fundamentalist movement and the anti-Communist fringe; Nixon had perfected the Southern strategy; and the party had found its perfect pitchman - a former film star and ex-shill for General Electric. Ronald Reagan and the Republican PR machine pushed all of the right buttons, even resorting to an "October surprise" to manipulate the Iranian hostage crisis to their benefit.
Reagan and G. H. W. Bush (who, during the mid-1980s, may have been the de facto president) were the last US leaders of the World War II generation, their cohort's final gift to the nation. It was morning in America, but let the Earth be damned: the Republicans had found an electoral strategy so successful that Democrats began trying to copy it, so that since 1980 the entire US political system has lurched ever further toward increased economic inequality, globalization, imperialism, and militarism.
So what did the Boomers do after 1980?
Having already taken a detour into the bleary world of recreational drugs, many of the more spirited Boomers now turned to gurus, meditation, and cults: politics was a bummer; if we really wanted to change the world we should change our heads first.
Other Boomers steered toward the stock market and scrambled up the corporate ladder. They got jobs, made money, and discovered that "greed is good." By the end of the decade it was apparent the Boomers were divided, with some upholding the Earth Day vision, others honing their skills as right-wing radio talk show hosts, and the rest just trying to get by.
Another Fork in the Road
Bill Clinton, the first Boomer president (born in 1946), elicited high hopes among his generational peers feeling battered by a dozen years of Reagan/Bush. But as governor of Arkansas Clinton had already learned the necessity of obeying entrenched power-holders in order to get along in politics. Moreover, by now the American governmental-corporate system was far too large and complex, and had far too much momentum behind it, to permit a fundamental change in direction.
In the late 1960s and early '70s many of us had believed that when our generation eventually took over the reins of power we would change the world. Well, here we were with one of our cohort as president and the country was more deeply mired than ever in the banality of consumerism. The WWII generation was increasingly filling obituary pages and populating nursing homes; now we had no one to blame but ourselves. The generation of peace and love had become the generation of SUVs and fast food.
It was clear that we had deluded ourselves by thinking of our cohort as united in its values, or by imagining that those values were somehow immutable. Just as Brokaw's "greatest generation" had started out in the 1930s battling the evils of unrestrained capitalism and went on in the 1940s to fight the menace of fascism only to end by electing Nixon, Reagan, and Bush and supporting the Vietnam war, we were now doing something similar.
This is not to say that all of our number had sold out: we could count as generational heroes and heroines thousands of scientists, activists, artists, musicians, and writers who kept alive the Earth Day ideal of a society that lives in harmony with nature rather than parasitically destroying it. However, with each passing year that ideal seemed ever more elusive - especially so following the 2000 election.
We watched as that election was stolen, and our outrage only grew as we saw prominent Democrats quietly acquiescing to the evisceration of what was left of American democracy. The events of 9/11 jolted even the drowsiest awake, and some of us began paying attention as never before when we realized that mainstream news organizations were failing to ask the most obvious questions about the events - about the mysterious collapse of the towers, the failure of officials to dispatch jet fighters, the immediate confiscation and destruction of evidence, the suspicious airline stock trades, the thwarted warnings, and much more. With the invasions of Afghanistan and Iraq, the detentions in Guantanamo, and the passage of the USA Patriot Act, it became clear that the US had entered an entirely new historical period. The current pseudo-president was another Boomer, but his shortcomings didn't end with corruption and simple-mindedness: he was, in the words of George Washington University psychiatrist Dr. Justin Frank, "an untreated alcoholic with paranoid and megalomaniac tendencies," and his cronies were evidently dedicated neo-fascists with every intention of turning America into a Disneyland Reich. That they were ridiculously inept made them all the more dangerous.
In response, in recent months, some Boomers have honed their political consciousness. Michael Moore has most publicly led the way in this regard, but Cynthia McKinney, Michael Ruppert, and Catherine Austin Fitts are perhaps more emblematic of the leading edge of this reinvigorated political awareness and commitment.
With the 2004 election season the two poles of the Boomer generation are facing off over America's future, and that of the world. But this is to be no ordinary election. There is little chance today of any broad public discussion of the real issue that will impact our lives in the next few years - that the generation that grew up expecting always more will soon be faced with less. The nation, now hallucinating uncontrollably from toxic exposure to Fox News, is in debt to the point that no conceivable decision made today will prevent a devastating implosion of the US economy. Global oil production is going to peak before 2010. And the election itself may already be rigged, with remotely programmable electronic voting machines in place in the few strategic counties that can deliver the needed Electoral College tally.
It may seem cynical to some if I say that it is too late to salvage America's political system, its economy, its suburban way of life; that it is even too late to contemplate an easy and peaceful transition to a different socio-ecological reality - that possibility probably died in 1980. But as far as I can tell, these are the facts. As they say these days, get over it.
This doesn't mean that life will end tomorrow. The American dream is going down, yet we still have some control over how it goes down. And it is in this remaining arena of choice that we Boomers might partially redeem ourselves.
While our current struggle is not entirely defined by the project of trying to elect John Kerry (whose policies are "Bush Lite" in many respects), the expulsion of Bush and the neocons from power is a necessary immediate goal.
But there is a far more momentous long-term test ahead. During the next two decades we Boomers will assume the role of elders. We will have amassed considerable financial capital, as well as human capital in the forms of competence, credibility, and connections. How will we use this capital?
If we use it for any purpose other than to help awaken all and sundry to our collective plight, and to lead a change of course toward a peaceful, local, slow, and self-limiting post-fossil-fuel way of life, it will all have been wasted.
In the decades ahead we will be going through hell. That is an awful thing to contemplate, but the only alternative to accepting the fact is to live in denial until the reality is inescapable and our room for maneuvering is even more restricted than it has already become. What we must do now is to lay the groundwork for collective survival. We must build lifeboats, or support the younger lifeboat-builders among us.
This is not the grandiose project we imagined for ourselves back in the 1960s and '70s. Maybe people who are around decades from now will again be able to contemplate the creation of ecotopia - let us hope so. We Boomers have stolen much from those future generations; the main question remaining is, can we now give back at least the possibility that those generations will be permitted to exist?
If you wish to republish any of these essays or post them on a web site, please contact rheinberg@museletter.com for permission.
Termination of the fossil-fuels society
Written by Jan Lundberg
Culture Change Letter #108 - August 11, 2005
Based on today's intensifying trends, warning signs and an understanding of history, one must be ready to see the fossil-fueled phase come to an end most abruptly. When common practices cannot be maintained and too many people suddenly scurry for scant supplies, the desired resource dries up. This causes ramifications that quickly compound whatever triggered the crisis.
At this writing, crude oil futures have passed the $65/barrel mark. In this column we have been anticipating heavier, rapid changes to economics and social order: petrocollapse (see previous reports).
Fossil-fueled civilization has spanned all of modern times, even though its reign will have been short. But its length has been the most damaging event in the planet's history during humans' existence. To really fix today's vast, complex, fossil-fuel-based problem, the culture that created it must be eliminated. Forces beyond anyone's control will bring this about.
What will we be left with? Forget Walmart, celebrities' plastic smiles, and another $286 billion to pave over more good land. Finally! "The Revolution will not be televised," as the Last Poets advised three and a half decades ago.
One does not look forward to no lights, refrigeration and what have you. Those who anticipate a future without "universal" material luxuries should not be considered bent on depriving others of what are called necessities in the U.S., although most of the rest of the world does without them. However, if the petroleum-dependent societies are going to revert to what is really the long-term norm -- that of subsistence farming and very low energy use, as predicted recently by writers such as James Howard Kunstler and Richard Heinberg -- it can only be healthy to anticipate the coming absence of appliances and whatever else passes for wealth in the consumer economy.
Not only have global warming and a massive wave of extinction been irrevocably launched; a road-based transportation mode has overrun much of the planet, and petrochemicals are an unmitigated disaster despite their convenience and versatility. An overall replacement for the dysfunctional fossil-fueled system is the honoring of the Earth's natural processes that provided wise tribes with the wherewithal to live for millennia. This statement is a heresy to those who love today's cities and who therefore would only reform our terminal civilization. It is as if their fossil-fuel tradition is deeply rooted.
Much of what passes for nice and proper in today's fossil-fueled culture is unworthy of preservation. Most of the world's people are assaulted daily by commercialism and toxicity as an extension of capitalistic exploitation. When the effects of runaway technology are seen as an assault on nature and they isolate humans into being consumers, "the baby needs to be thrown out with the bath water." This does not at all mean cutting our own throats if we are committed to positive change. In fact, there are helpful if daring steps to take now (read on).
To sketch in the details of what could be tomorrow's Utopia is useful but not the task of this essay. Visions from Culture Change and others such as Ecocity Builders, and the eco-village and permaculture movements are making the attempt. It is as if we are in a dark night trying to describe a new place the dawn will bring, and we are unable to see what the landscape will look like or how populated it will be. We must leave assumptions behind, particularly if they are the product of a failed system of a dying culture.
Even if we cherish certain aspects of civilization, e.g., an impressive city such as Paris, perhaps very little can survive petrocollapse. So it serves us well to reject the basic concept of fossil-fueled (and, by extension, nuclear-powered) civilization. If we trace its creation, fossil-fueled society had to do with generating maximum profits via boom and bust development and subjugation of peoples and their environments. If we think about the purposes and benefits of fossil fueled civilization, the price is too high. The main march of history must end and give way to an entirely new sense of respect for all humanity and all living things.
To get on with terminating the planet-threatening fossil-fueled lifestyle and the built infrastructure strangling the world, we should first list some absurdities that negate the "progress" of fossil-fueled civilization:
- shipping food thousands of miles
- loss of self-sufficiency in food, water, medicines, etc. in one's home region
- killing abroad for oil
- the holocaust of global car crashes
- loss of hand-craft skills
- commodifying life's essentials that had always been free
- effects of crowding such as diminished freedoms
Wind energy and other "renewables" have been available since before petrocollapse appeared certain, but renewables have failed to gain a significant foothold. Now it is too late to revamp the whole economy. More meaningful action than the technofix is required immediately, and more technology would primarily extend the status quo. Those who imagine that universal hot running water and ubiquitous computers are necessary for life believe we must preserve our technical accomplishments at all costs.
In truth, the imperative to terminate fossil-fueled civilization is the greatest adventure today and perhaps ever in history. As the fall of this civilization is already starting -- no matter if China, for example, serves to maximize global consumption -- the encouragement of inevitable change is an opportunity for positive creativity.
In our lives, changes often impact us badly when we are unprepared. But when a conscious change is undertaken to advance one's desired goals, there is more control and enjoyment. Julia Butterfly told the Auto-Free Times, in her first cover-story interview by a national magazine, that some people wait to have "change hit them upside the head like a two-by-four." Taking risks for changing one's life can be hazardous, but how can eliminating fossil-fueled dependence be a risk? Clinging to massive energy use in an overpopulated world, by enacting only a Kyoto-Protocol level of change, for example, is a scientifically understood formula for failure of our precious, delicate, common global climate.
In the absence of any activist group with courage that enjoys a mass support base, individual and affinity-group actions are required to strike at the fossil-fueled beast by demonstrating low-energy-consumption living. Additionally, high-profile monkey-wrenching that does not smack of terrorism can serve to educate.
A tiny list:
- Potatoes stuck into exhaust pipes are a harmless but clear statement if a note explaining the action is placed on the windshield. Motorists would get the message and tell others.
- By the same token, bicycle riders should be given hugs, gifts and reverence.
- Preparedness drills should be carried out whereby a community's food or water supply is cut temporarily, of course with the consent of all concerned, to dramatize today's extreme dependencies.
- disruption of school classes and other institutional meetings should be undertaken to speak extemporaneously about the peak of global oil extraction and the implications for business-as-usual. There are artful ways of doing this, if we take the example of the Yippies who burned dollar bills in public and kissed each other during university lectures devoted to maintaining the loveless status quo.
Why must this urgent approach take precedence over the possibility of reforming the system from within? The global economy is the enemy if it runs on polluting fuels and sets people up for devastating deprivation once petroleum shortage hits "without warning." Therefore, a John Kerry presidency upholding "free" trade agreements and pledging to keep subsidizing the price of gasoline is a non-starter.
Daniel Quinn wrote in his 1999 book Beyond Civilization that programs serve the (flawed) system and do not offer a replacement vision. So nothing substantial is fixed. What I got for the first time, from this book and two of his other great books of our time, The Story of B and My Ishmael, is a clear sense that reforms and programs do not solve the inherent flaws of civilization and our unjust society. A new vision or a better model, in place of the existing social system, is the only sensible course.
Quinn points out that a culture's visions are more powerful than programs, and that both visions and programs can turn out ugly. Programs attempt to protect the environment, for example, but only to keep it from becoming even more degraded than it is. Programs can be essential but ultimately inadequate because they are essentially reactive: "...they only make bad things less bad. They don't bring into being something good, they only drag their feet against something bad... If there's no new vision for us at the end of the road then we are going to die, because programs (useful as they are) just don't have the capacity to keep us alive indefinitely."
Can the word "reforms" be substituted for "programs"? To write this essay, I asked him what he might have on the subject of reform in his books. He refreshed my mind that he had instead written about programs and vision. He refered me to his theme-index for his books at the end of Beyond Civilization, which I recommend to anyone. I reread today with pleasure some of his observations:
"The tribe, in fact, is just a wonderfully efficient social organization that renders making a living easy for all -- unlike civilization, which renders it easy for a privileged few and hard for the rest... The tribal way isn't [necessarily] the right way, it's just a way that worked for millions of years, in contrast to the hierarchal way, which has brought us face to face with extinction after a mere ten thousand years."
The original title of this essay was "Ending the idiotic fossil-fuels existence". I altered it to "Termination of the fossil-fuels society" for the sake of credibility. I originally flashed on this whole concept while sitting in a restaurant on Telegraph Avenue in Berkeley. I had a very odd feeling about our civilization, a feeling which very few people probably ever had a number of years ago. Things are more absurd every day. When one takes a serious look around at society's set up, the overwhelming madness is clear. For example, one of the mind-blowing mini-analyses of our materialist culture is what Daniel Quinn pointed out: the food is locked up. What's hard for many to grasp is how, if society and Western Civilization do work, more reforms and programs are inadequate and even may be the wrong approach at this hour in our deepening dilemma.
What is idiotic is the pursuit of the "unending" existence of fossil-fueled society, in all manifestations: electronic music, plastic tables, natural-gas heated food, SUVs powering noisily by, and, craziest and saddest of all, thinking that maybe this is heading in a good direction someday somehow.
I want culture change not just because I want to see the ecosystem saved for biodiversity. I want community which will help save the ecosystem and see social justice, and I want people to enjoy their time on Earth. Fossil-fueled culture gave up community and can barely help itself address real problems. If you want culture change too, tell others.
Written by Jan Lundberg
Culture Change Letter #108 - August 11, 2005
Based on today's intensifying trends, warning signs and an understanding of history, one must be ready to see the fossil-fueled phase come to an end most abruptly. When common practices cannot be maintained and too many people suddenly scurry for scant supplies, the desired resource dries up. This causes ramifications that quickly compound whatever triggered the crisis.
At this writing, crude oil futures have passed the $65/barrel mark. In this column we have been anticipating heavier, rapid changes to economics and social order: petrocollapse (see previous reports).
Fossil-fueled civilization has spanned all of modern times, even though its reign will have been short. But its length has been the most damaging event in the planet's history during humans' existence. To really fix today's vast, complex, fossil-fuel-based problem, the culture that created it must be eliminated. Forces beyond anyone's control will bring this about.
What will we be left with? Forget Walmart, celebrities' plastic smiles, and another $286 billion to pave over more good land. Finally! "The Revolution will not be televised," as the Last Poets advised three and a half decades ago.
One does not look forward to no lights, refrigeration and what have you. Those who anticipate a future without "universal" material luxuries should not be considered bent on depriving others of what are called necessities in the U.S., although most of the rest of the world does without them. However, if the petroleum-dependent societies are going to revert to what is really the long-term norm -- that of subsistence farming and very low energy use, as predicted recently by writers such as James Howard Kunstler and Richard Heinberg -- it can only be healthy to anticipate the coming absence of appliances and whatever else passes for wealth in the consumer economy.
Not only have global warming and a massive wave of extinction been irrevocably launched; a road-based transportation mode has overrun much of the planet, and petrochemicals are an unmitigated disaster despite their convenience and versatility. An overall replacement for the dysfunctional fossil-fueled system is the honoring of the Earth's natural processes that provided wise tribes with the wherewithal to live for millennia. This statement is a heresy to those who love today's cities and who therefore would only reform our terminal civilization. It is as if their fossil-fuel tradition is deeply rooted.
Much of what passes for nice and proper in today's fossil-fueled culture is unworthy of preservation. Most of the world's people are assaulted daily by commercialism and toxicity as an extension of capitalistic exploitation. When the effects of runaway technology are seen as an assault on nature and they isolate humans into being consumers, "the baby needs to be thrown out with the bath water." This does not at all mean cutting our own throats if we are committed to positive change. In fact, there are helpful if daring steps to take now (read on).
To sketch in the details of what could be tomorrow's Utopia is useful but not the task of this essay. Visions from Culture Change and others such as Ecocity Builders, and the eco-village and permaculture movements are making the attempt. It is as if we are in a dark night trying to describe a new place the dawn will bring, and we are unable to see what the landscape will look like or how populated it will be. We must leave assumptions behind, particularly if they are the product of a failed system of a dying culture.
Even if we cherish certain aspects of civilization, e.g., an impressive city such as Paris, perhaps very little can survive petrocollapse. So it serves us well to reject the basic concept of fossil-fueled (and, by extension, nuclear-powered) civilization. If we trace its creation, fossil-fueled society had to do with generating maximum profits via boom and bust development and subjugation of peoples and their environments. If we think about the purposes and benefits of fossil fueled civilization, the price is too high. The main march of history must end and give way to an entirely new sense of respect for all humanity and all living things.
To get on with terminating the planet-threatening fossil-fueled lifestyle and the built infrastructure strangling the world, we should first list some absurdities that negate the "progress" of fossil-fueled civilization:
- shipping food thousands of miles
- loss of self-sufficiency in food, water, medicines, etc. in one's home region
- killing abroad for oil
- the holocaust of global car crashes
- loss of hand-craft skills
- commodifying life's essentials that had always been free
- effects of crowding such as diminished freedoms
Wind energy and other "renewables" have been available since before petrocollapse appeared certain, but renewables have failed to gain a significant foothold. Now it is too late to revamp the whole economy. More meaningful action than the technofix is required immediately, and more technology would primarily extend the status quo. Those who imagine that universal hot running water and ubiquitous computers are necessary for life believe we must preserve our technical accomplishments at all costs.
In truth, the imperative to terminate fossil-fueled civilization is the greatest adventure today and perhaps ever in history. As the fall of this civilization is already starting -- no matter if China, for example, serves to maximize global consumption -- the encouragement of inevitable change is an opportunity for positive creativity.
In our lives, changes often impact us badly when we are unprepared. But when a conscious change is undertaken to advance one's desired goals, there is more control and enjoyment. Julia Butterfly told the Auto-Free Times, in her first cover-story interview by a national magazine, that some people wait to have "change hit them upside the head like a two-by-four." Taking risks for changing one's life can be hazardous, but how can eliminating fossil-fueled dependence be a risk? Clinging to massive energy use in an overpopulated world, by enacting only a Kyoto-Protocol level of change, for example, is a scientifically understood formula for failure of our precious, delicate, common global climate.
In the absence of any activist group with courage that enjoys a mass support base, individual and affinity-group actions are required to strike at the fossil-fueled beast by demonstrating low-energy-consumption living. Additionally, high-profile monkey-wrenching that does not smack of terrorism can serve to educate.
A tiny list:
- Potatoes stuck into exhaust pipes are a harmless but clear statement if a note explaining the action is placed on the windshield. Motorists would get the message and tell others.
- By the same token, bicycle riders should be given hugs, gifts and reverence.
- Preparedness drills should be carried out whereby a community's food or water supply is cut temporarily, of course with the consent of all concerned, to dramatize today's extreme dependencies.
- disruption of school classes and other institutional meetings should be undertaken to speak extemporaneously about the peak of global oil extraction and the implications for business-as-usual. There are artful ways of doing this, if we take the example of the Yippies who burned dollar bills in public and kissed each other during university lectures devoted to maintaining the loveless status quo.
Why must this urgent approach take precedence over the possibility of reforming the system from within? The global economy is the enemy if it runs on polluting fuels and sets people up for devastating deprivation once petroleum shortage hits "without warning." Therefore, a John Kerry presidency upholding "free" trade agreements and pledging to keep subsidizing the price of gasoline is a non-starter.
Daniel Quinn wrote in his 1999 book Beyond Civilization that programs serve the (flawed) system and do not offer a replacement vision. So nothing substantial is fixed. What I got for the first time, from this book and two of his other great books of our time, The Story of B and My Ishmael, is a clear sense that reforms and programs do not solve the inherent flaws of civilization and our unjust society. A new vision or a better model, in place of the existing social system, is the only sensible course.
Quinn points out that a culture's visions are more powerful than programs, and that both visions and programs can turn out ugly. Programs attempt to protect the environment, for example, but only to keep it from becoming even more degraded than it is. Programs can be essential but ultimately inadequate because they are essentially reactive: "...they only make bad things less bad. They don't bring into being something good, they only drag their feet against something bad... If there's no new vision for us at the end of the road then we are going to die, because programs (useful as they are) just don't have the capacity to keep us alive indefinitely."
Can the word "reforms" be substituted for "programs"? To write this essay, I asked him what he might have on the subject of reform in his books. He refreshed my mind that he had instead written about programs and vision. He refered me to his theme-index for his books at the end of Beyond Civilization, which I recommend to anyone. I reread today with pleasure some of his observations:
"The tribe, in fact, is just a wonderfully efficient social organization that renders making a living easy for all -- unlike civilization, which renders it easy for a privileged few and hard for the rest... The tribal way isn't [necessarily] the right way, it's just a way that worked for millions of years, in contrast to the hierarchal way, which has brought us face to face with extinction after a mere ten thousand years."
The original title of this essay was "Ending the idiotic fossil-fuels existence". I altered it to "Termination of the fossil-fuels society" for the sake of credibility. I originally flashed on this whole concept while sitting in a restaurant on Telegraph Avenue in Berkeley. I had a very odd feeling about our civilization, a feeling which very few people probably ever had a number of years ago. Things are more absurd every day. When one takes a serious look around at society's set up, the overwhelming madness is clear. For example, one of the mind-blowing mini-analyses of our materialist culture is what Daniel Quinn pointed out: the food is locked up. What's hard for many to grasp is how, if society and Western Civilization do work, more reforms and programs are inadequate and even may be the wrong approach at this hour in our deepening dilemma.
What is idiotic is the pursuit of the "unending" existence of fossil-fueled society, in all manifestations: electronic music, plastic tables, natural-gas heated food, SUVs powering noisily by, and, craziest and saddest of all, thinking that maybe this is heading in a good direction someday somehow.
I want culture change not just because I want to see the ecosystem saved for biodiversity. I want community which will help save the ecosystem and see social justice, and I want people to enjoy their time on Earth. Fossil-fueled culture gave up community and can barely help itself address real problems. If you want culture change too, tell others.
Well, thank GOD that we have the WTO, NAFTA and the like. What would politicians and lawyers do with all their free time if they didn't have these trade issues to squabble over?
Canada suffers setback in new softwood ruling
The World Trade Organization has ruled that the US complied with international law when it imposed billions of dollars of duties on Canadian lumber - a decision that the US calls vindication and Canada says is a setback. The WTO panel ruled yesterday that the US adhered to international law when it issued a revised finding in late 2004 that Canadian softwood lumber imports threatened its mills, said a US trade official, speaking on the condition of anonymity. The confidential ruling, confirmed by Canadian officials, further complicates an already tangled web of legal decisions in the long-running trade feud. Canada has trumpeted a seemingly contradictory North American free trade panel ruling earlier this month as the end of the dispute. That panel found the US duties, which now total more than $4-billion, illegal under US law, prompting Ottawa to call for their immediate removal. At a meeting of New England governors and Eastern Canadian premiers yesterday, Frank McKenna, Canada's ambassador to the US, pointed out that one NAFTA panel after another has ruled in Canada's favour. “You can't have it both ways,” he said during a news conference.
In Washington, the US trade official said the WTO panel's “findings confirm that the . . . duties on Canadian lumber were justified to counter the threat of material injury to the US industry.” The official added that the WTO ruling provides “an independent basis” for keeping in place the duties, which are costing Canadian lumber companies US$100-million a month. Toronto trade lawyer Lawrence Herman said the WTO and NAFTA rulings aren't so much contradictory as “mutually exclusive.” NAFTA panels determine whether a country is complying with its own laws, while WTO panels check adherence to international trade laws, he said. In recent days, several members of Prime Minister Paul Martin's cabinet and opposition politicians have called on Ottawa to hit the US with retaliatory duties, sparking an increasingly heated cross-border war of words. Even before yesterday's ruling, the Bush administration has refused to budge, urging instead that the two sides negotiate a compromise.
Yesterday's WTO ruling is an interim decision. A final ruling, which seldom varies from the original, will be made public in October. Both sides can appeal. “We're disappointed with this interim report, which is a setback in an ongoing stream of litigation,” said Jacqueline Larocque, a spokeswoman for international trade minister Jim Peterson. But Canadian officials were quick to play down the significance of the WTO decision, noting it is only an interim ruling and that lawyers are already preparing to appeal. Meanwhile, Ottawa is rekindling two further legal challenges. The Canadians want the US Court of International Trade to order the US government to lift the duties and refund everything it has collected so far. Ottawa is also seeking a ruling from the court that the so-called Byrd amendment does not apply to Canada and Mexico, the US's partners in NAFTA. Under the Byrd law, all anti-dumping and countervailing duties must be paid to affected US companies, rather than the US Treasury.
Columnist Diane Francis writes that the Liberals have completely mishandled the softwood lumber file, and now there are only a couple of things Ottawa can do. Prime Minister Paul Martin should personally meet President Bush to convey to him how unjust this all is and how Canada has been put in a box because it cannot negotiate a deal with a Commerce Department that has shown it will ignore agreements and court rulings. The Prime Minister should also emphasize to the President that both countries are very dependent upon one another, that Canada wants to do its best to continue to trade in energy and other goods and services with the Americans and that Canada will be happy to expedite the construction of an Alaska pipeline. Then the Prime Minister should give the President time to correct the situation. If nothing is done, then the government must alter policy direction somewhat in the face of blatant American protectionism. This would include emphasis by Ottawa and the provinces on assisting and expediting forestry and other resource exports outside the US where it makes economic sense. Then a priority must be put on building an oil pipeline from Alberta's oilsands to BC's coast for export to China, India and other countries. That will reduce dependency upon the US market for those massive oil exports in future in order to keep the Americans honest. The American trade bureaucracy is behaving like a forestry monopoly buyer that has destroyed the market and given Canada no other choice but to pre-emptively protect itself.
(Globe and Mail, Vancouver Sun, National Post 050830)
First the decision goes to Canada, then the U.S., then Canada, then the U.S. depending on which body is appealed to. WTF? Who's got final say on this crap?
Canada suffers setback in new softwood ruling
The World Trade Organization has ruled that the US complied with international law when it imposed billions of dollars of duties on Canadian lumber - a decision that the US calls vindication and Canada says is a setback. The WTO panel ruled yesterday that the US adhered to international law when it issued a revised finding in late 2004 that Canadian softwood lumber imports threatened its mills, said a US trade official, speaking on the condition of anonymity. The confidential ruling, confirmed by Canadian officials, further complicates an already tangled web of legal decisions in the long-running trade feud. Canada has trumpeted a seemingly contradictory North American free trade panel ruling earlier this month as the end of the dispute. That panel found the US duties, which now total more than $4-billion, illegal under US law, prompting Ottawa to call for their immediate removal. At a meeting of New England governors and Eastern Canadian premiers yesterday, Frank McKenna, Canada's ambassador to the US, pointed out that one NAFTA panel after another has ruled in Canada's favour. “You can't have it both ways,” he said during a news conference.
In Washington, the US trade official said the WTO panel's “findings confirm that the . . . duties on Canadian lumber were justified to counter the threat of material injury to the US industry.” The official added that the WTO ruling provides “an independent basis” for keeping in place the duties, which are costing Canadian lumber companies US$100-million a month. Toronto trade lawyer Lawrence Herman said the WTO and NAFTA rulings aren't so much contradictory as “mutually exclusive.” NAFTA panels determine whether a country is complying with its own laws, while WTO panels check adherence to international trade laws, he said. In recent days, several members of Prime Minister Paul Martin's cabinet and opposition politicians have called on Ottawa to hit the US with retaliatory duties, sparking an increasingly heated cross-border war of words. Even before yesterday's ruling, the Bush administration has refused to budge, urging instead that the two sides negotiate a compromise.
Yesterday's WTO ruling is an interim decision. A final ruling, which seldom varies from the original, will be made public in October. Both sides can appeal. “We're disappointed with this interim report, which is a setback in an ongoing stream of litigation,” said Jacqueline Larocque, a spokeswoman for international trade minister Jim Peterson. But Canadian officials were quick to play down the significance of the WTO decision, noting it is only an interim ruling and that lawyers are already preparing to appeal. Meanwhile, Ottawa is rekindling two further legal challenges. The Canadians want the US Court of International Trade to order the US government to lift the duties and refund everything it has collected so far. Ottawa is also seeking a ruling from the court that the so-called Byrd amendment does not apply to Canada and Mexico, the US's partners in NAFTA. Under the Byrd law, all anti-dumping and countervailing duties must be paid to affected US companies, rather than the US Treasury.
Columnist Diane Francis writes that the Liberals have completely mishandled the softwood lumber file, and now there are only a couple of things Ottawa can do. Prime Minister Paul Martin should personally meet President Bush to convey to him how unjust this all is and how Canada has been put in a box because it cannot negotiate a deal with a Commerce Department that has shown it will ignore agreements and court rulings. The Prime Minister should also emphasize to the President that both countries are very dependent upon one another, that Canada wants to do its best to continue to trade in energy and other goods and services with the Americans and that Canada will be happy to expedite the construction of an Alaska pipeline. Then the Prime Minister should give the President time to correct the situation. If nothing is done, then the government must alter policy direction somewhat in the face of blatant American protectionism. This would include emphasis by Ottawa and the provinces on assisting and expediting forestry and other resource exports outside the US where it makes economic sense. Then a priority must be put on building an oil pipeline from Alberta's oilsands to BC's coast for export to China, India and other countries. That will reduce dependency upon the US market for those massive oil exports in future in order to keep the Americans honest. The American trade bureaucracy is behaving like a forestry monopoly buyer that has destroyed the market and given Canada no other choice but to pre-emptively protect itself.
(Globe and Mail, Vancouver Sun, National Post 050830)
First the decision goes to Canada, then the U.S., then Canada, then the U.S. depending on which body is appealed to. WTF? Who's got final say on this crap?
Friday, August 26, 2005
This is essentially a summary of JHK's book, "The Long Emergency":
Remarks in Hudson, NY
January 8, 2005
James Howard Kunstler
My last three books were concerned with the physical arrangement of life in our nation, in particular suburban sprawl, the most destructive development pattern the world has ever seen, and perhaps the greatest misallocation of resources the world has ever known.The world - and of course the US - now faces an epochal predicament: the global oil production peak and the arc of depletion that follows. We are unprepared for this crisis of industrial civilization. We are sleepwalking into the future.
The global peak oil production event will change everything about how we live. It will challenge all of our assumptions. It will compel us to do things differently - whether we like it or not.
Nobody knows for sure when the absolute peak year of global oil production will occur. You can only tell for sure in the "rear-view mirror," seeing the data after the fact. The US oil production peak in 1970 was not really recognized until the numbers came in over the next couple of years. By 1973 it was pretty clear that US oil production was in decline - the numbers were there for anyone to see, because the US oil industry was fairly transparent. They had to report their production to regulatory agencies. And low and behold American production was going down - despite the fact that we were selling more cars and more suburban houses. Of course we had been making up for falling production by increasing our oil imports.1973 was the yea r of the Yom Kippur War. With encouragement from the old Soviet Union, Syria and Egypt ganged up on Israel and after a rough start, Israel kicked their asses. The Islamic world was very ticked off - especially at the assistance that the US had given Israel in airlifted military equipment. So a lot of pressure was brought to bear on the leaders of the Arab oil states to punish the US and we got the famous OPEC embargo of 1973.
But it was more than that. The OPEC embargo was effective precisely because it was now recognized by everybody that the US had passed its all time oil production peak. We no longer had surplus capacity. We weren't the swing producer anymore, OPEC was. We were pumping flat-out just to stay in place, and depending on imports to make up for the rest.
That was a tectonic shift in world economics.
That's exactly when OPEC seized pricing control of the oil markets. We had a very rough decade. 20 percent interest rates. "Stagflation." High unemployment. Stock market in the toilet.
We had a second oil crisis in 1979 when the shah of Iran was overthrown. The 1970s closed on a note of desperation. Everything we did in America was tied to oil and foreigners were jerking our economy around, and it led the worst recession since the 1930s.
But we got over it and a lot of Americans drew the false conclusion that the these oil crises were a shuck and jive on the part of business and Arab oil sheiks.
How did we get over it? The oil crises of the 70s prompted a frantic era of drilling, and the last great oil discoveries came on line in the 1980s - chiefly the North Sea fields of England and Norway, and the Alaska fields of the North Slope and Prudhoe Bay. They literally saved the west's ass for 20 years. In fact, so much oil flowed out of them that the markets were glutted, and by the era of Bill Clinton, oil prices were headed down to as low as $10 a barrel.
It was all an illusion. The North Sea and Alaska are now well into depletion - they were drilled with the newest technology and - guess what - we depleted them more efficiently! England is now becoming a new oil importer again after a 20 year fiesta. The implications are very grim.
Now, some of the most knowledgeable geologists in the world believe we have reached the global oil production peak. Unlike the US oil industry, the foreign producers do not give out their production data so transparently. We may never actually see any reliable figures. The global production peak may only show up in the strange behavior of the markets.
The global peak is liable to manifest as a "bumpy plateau." Prices will wobble. Markets will wobble - as the oil markets have been doing the past year. International friction will increase, especially around the places where the oil is - and two-thirds of the world's remaining oil is in the states around the Persian Gulf where, every week, a half dozen US soldiers and many more Iraqis are getting blown up, beheaded, or shot.
The "bumpy plateau" is where all kind of market signals and political signals are telling you that "something is happening, Mr. Jones, but you don't know what it is." We'll only know in the rear-view mirror.
As of the past 12 months, Saudi Arabia seems to have lost the ability to function as 'swing producer.' The swing producer is the one with a lot of excess supply, who can just open the valves and let more oil out on the world markets, which inevitably drives the price down. Saudi Arabia has kept saying they would produce a million more barrels a day, but there's no evidence that they really have.
Well, the good news is that Saudi Arabia and OPEC can no longer set the price of oil. The bad news is that nobody can. When there is no production surplus in the world, that's a pretty good sign that the world is at peak.
Princeton Geologist Kenneth Deffeyes says that peak production will occur in 2005. We're there. Others, like Colin Campbell, former chief geologist for Shell Oil, put it more conservatively as between now and 2007. But by any measure of rational planning or policy-making, these differences are insignificant.
The meaning of the oil peak and its enormous implications are generally misunderstood even by those who have heard about it - and this includes the mainstream corporate media and the Americans who make plans or policy.
The world does not have to run out of oil or natural gas for severe instabilities, network breakdowns, and systems failures to occur. All that is necessary is for world production capacity to reach its absolute limit - a point at which no increased production is possible and the long arc of depletion commences, with oil production then falling by a few percentages steadily every year thereafter. That's the global oil peak: the end of absolute increased production and beginning of absolute declining production.
And, of course, as global oil production begins to steadily decline, year after year, the world population is only going to keep growing - at least for a while - and demand for oil will remain very robust. The demand line of the graph will pass the production line, and in doing so will set in motion all kinds of problems in the systems we rely on for daily life.
One huge implication of the oil peak is that industrial societies will never again enjoy the 2 to 7 percent annual economic growth that has been considered healthy for over 100 years. This amounts to the industrialized nations of the world finding themselves in a permanent depression.
Long before the oil actually depletes we will endure world-shaking political disturbances and economic disruptions. We will see globalism-in-reverse. Globalism was never an 'ism,' by the way. It was not a belief system. It was a manifestation of the 20-year-final-blowout of cheap oil. Like all economic distortions, it produced economic perversions. It allowed gigantic, predatory organisms like WalMart to spawn and reproduce at the expense of more cellular fine-grained economic communities.
The end of globalism will be hastened by international competition over the world's richest oil-producing regions.
We are already seeing the first military adventures over oil as the US attempts to pacify the Middle East in order to assure future supplies. This is by no means a project we can feel confident about. The Iraq war has only been the overture to more desperate contests ahead. Bear in mind that the most rapidly industrializing nation in the world, China, is geographically closer to Caspian Region and the Middle East than we are. The Chinese can walk into these regions, and someday they just might.In any case, and apart from the likelihood of military mischief, as the world passes the petroleum peak the global oil markets will destabilize and the industrial nations will have enormous problems with both price and supply. The effect on currencies and international finance will, of course, be equally severe.
Some of you may be aware that the US faces an imminent crisis with natural gas, at least as threatening as the problems we face over oil. By natural gas I mean methane, the stuff we run our furnaces and kitchen stoves on. Over the past two decades - in response to the OPEC embargoes of the 70s and the Chernobyl and Three Mile Island emergencies of the 80s -- we have so excessively shifted our electric power generation to dependence on natural gas that no amount of drilling can keep up with current demand. The situation is very ominous now.The United States, indeed North America, including Canada and Mexico, is technically way past peak production in natural gas and there is a special problem with gas that you don't have with oil: you tend to get your gas from the continent you are on. It comes out of the ground and is distributed around the continent in a pipeline network. If you have to get your natural gas from another continent, it has to be compressed at low temperature, transported in special ships with pressurized tanks, and delivered to special terminals where it is re-gasified. All this is tremendously more expensive than what we do now. Moreover, there are very few natural gas port terminals in the US and nobody wants them built anywhere near them because they are dangerous. They can blow up.We have been making up for our shortfall in gas in recent years by buying a lot of gas from Canada. The NAFTA treaty compels them to sell us their gas, and they are technically in depletion too. They're not happy about this.About half the houses in America are heated with natural gas. Nobody know what we are going to do when the depletion arc gets steeper.Oh, another problem with gas. The wells run dry just like this (snap!). Unlike oil wells, which go from gusher to steady stream to declining stream, gas wells either put out gas or they stop. And there's no warning when they are close to running out. Because, the gas is coming out of the ground under its own pressure. As the gas wells of North America continue to deplete, we will have little warning
Right here I am compelled to inform you that the prospects for alternative fuels are poor. We suffer from a kind of Jiminy Cricket syndrome in this country. We believe that if you wish for something, it will come true. Right now a lot of people - including people who ought to know better - are wishing for some miracle technology to save our collective ass.
There is not going to be a hydrogen economy. The hydrogen economy is a fantasy. It is not going to happen. We may be able to run a very few things on hydrogen - but we are not going to replace the entire US automobile fleet with hydrogen fuel cell cars.
" Getting hydrogen " Transport
Nor will we replace the current car fleet with electric cars or natural gas cars. We're just going to use cars a lot less. Fewer trips. Cars will be a diminished presence in our lives.Not to mention the political problem that kicks in when car ownership and driving becomes incrementally a more elite activity. The mass motoring society worked because it was so profoundly democratic. Practically anybody in America could participate, from the lowliest shlub mopping the floor at Pizza Hut to Bill Gates. What happens when it is no longer so democratic? And what is the tipping point at which it becomes a matter of political resentment: 12 percent? 23 percent? 38 percent?
Wind power and solar electric will not produce significant amounts of power within the context of the way we live now.
Ethanol and bio-deisel are a joke. They require more energy to produce than they give back. You know how you get ethanol: you produce massive amounts of corn using huge oil and gas 'inputs' of fertilizer and pesticide and then you use a lot more energy to turn the corn into ethanol. It's a joke.
No combination of alternative fuel systems currently known will allow us to run what we are running, the way we're running it, or even a substantial fraction of it.The future is therefore telling us very loudly that we will have to change the way we live in this country. The implications are clear: we will have to downscale and re-scale virtually everything we do.
The downscaling of America is a tremendous and inescapable project. It is the master ecological project of our time. We will have to do it whether we like it or not. We are not prepared.
Downscaling America doesn't mean we become a lesser people. It means that the scale at which we conduct the work of American daily life will have to be adjusted to fit the requirements of a post-globalist, post-cheap-oil age.We are going to have to live a lot more locally and a lot more intensively on that local level. Industrial agriculture, as represented by the Archer Daniels Midland / soda pop and cheez doodle model of doing things, will not survive the end of the cheap oil economy. The implication of this is enormous. Successful human ecologies in the near future will have to be supported by intensively farmed agricultural hinterlands. Places that can't do this will fail. Say goodbye to Phoenix and Las Vegas.
I'm not optimistic about most of our big cities. They are going to have to contract severely. They achieved their current scale during the most exuberant years of the cheap oil fiesta, and they will have enormous problems remaining viable afterward.Any mega-structure, whether it is a skyscraper or a landscraper - buildings that depend on huge amounts of natural gas and electricity - may not be usable a decade or two in the future.
What goes for the scale of places will be equally true for the scale of social organization. All large-scale enterprises, including many types of corporations and governments will function very poorly in the post-cheap oil world. Do not make assumptions based on things like national chain retail continuing to exist as it has.
Wal Mart is finished. [More below]
Many of my friends and colleagues live in fear of the federal government turning into Big Brother tyranny. I'm skeptical Once the permanent global energy crisis really gets underway, the federal government will be lucky if it can answer the phones. Same thing for Microsoft or even the Hannaford supermarket chain.
All indications are that American life will have to be reconstituted along the lines of traditional towns, villages, and cities much reduced in their current scale. These will be the most successful places once we are gripped by the profound challenge of a permanent reduced energy supply.The land development industry as we have known it is going to vanish in the years ahead. The production home-builders, as they like to call themselves. The strip mall developers. The fried food shack developers. Say goodbye to all that.
We are entering a period of economic hardship and declining incomes. The increment of new development will be very small, probably the individual building lot. The suburbs as are going to tank spectacularly. We are going to see an unprecedented loss of equity value and, of course, basic usefulness. We are going to see an amazing distress sale of properties, with few buyers. We're going to see a fight over the table scraps of the 20th century. We'll be lucky if the immense failure of suburbia doesn't result in an extreme political orgy of grievance and scapegoating.
The action in the years ahead will be in renovating existing towns and villages, and connecting them with regions of productive agriculture. Where the big cities are concerned, there is simply no historical precedent for the downscaling they will require. The possibilities for social and political distress ought to be obvious, though. The process is liable to be painful and disorderly.
The post cheap oil future will be much more about staying where you are than about being mobile. And, unless we rebuild a US passenger railroad network,a lot of people will not be going anywhere. Today, we have a passenger railroad system that the Bulgarians would be ashamed of.
Don't make too many plans to design parking structures. The post cheap oil world is not going to be about parking, either.
But it will be about the design and assembly and reconstituting of places that are worth caring about and worth being in. When you have to stay where you are and live locally, you will pay a lot more attention to the quality of your surroundings, especially if you are not moving through the landscape at 50 miles-per-hour.
Some regions of the country will do better than others. The sunbelt will suffer in exact proportion to the degree that it prospered artificially during the cheap oil blowout of the late 20th century. I predict that the Southwest will become substantially depopulated, since they will be short of water as well as gasoline and natural gas. I'm not optimistic about the Southeast either, for different reasons. I think it will be subject to substantial levels of violence as the grievances of the formerly middle class boil over and combine with the delusions of Pentecostal Christian extremism.
All regions of the nation will be affected by the vicissitudes of this Long Emergency, but I think New England and the Upper Midwest have somewhat better prospects. I regard them as less likely to fall into lawlessness, anarchy, or despotism, and more likely to salvage the bits and pieces of our best social traditions and keep them in operation at some level.
There is a fair chance that the nation will disaggregate into autonomous regions before the 21st century is over, as a practical matter if not officially. Life will be very local.
These challenges are immense. We will have to rebuild local networks of economic and social relations that we allowed to be systematically dismantled over the past fifty years. In the process, our communities may be able to reconstitute themselves.
The economy of the mid 21st century may center on agriculture. Not information. Not the digital manipulation of pictures, not services like selling cheeseburgers and entertaining tourists. Farming. Food production. The transition to this will be traumatic, given the destructive land-use practices of our time, and the staggering loss of knowledge. We will be lucky if we can feed ourselves.
The age of the 3000-mile-caesar salad will soon be over. Food production based on massive petroleum inputs, on intensive irrigation, on gigantic factory farms in just a few parts of the nation, and dependent on cheap trucking will not continue. We will have to produce at least some of our food closer to home. We will have to do it with fewer fossil-fuel-based fertilizers and pesticides on smaller-scaled farms. Farming will have to be much more labor-intensive than it is now. We will see the return of an entire vanished social class - the homegrown American farm laboring class.
N
We are going to have to reorganize everyday commerce in this nation from the ground up. The whole system of continental-scale big box discount and chain store shopping is headed for extinction, and sooner than you might think. It will go down fast and hard. Americans will be astonished when it happens.
Operations like WalMart have enjoyed economies of scale that were attained because of very special and anomalous historical circumstances: a half century of relative peace between great powers. And cheap oil - absolutely reliable supplies of it, since the OPEC disruptions of the 1970s. WalMart and its imitators will not survive the oil market disruptions to come. Not even for a little while. WalMart will not survive when its merchandise supply chains to Asia are interrupted by military contests over oil or internal conflict in the nations that have been supplying us with ultra-cheap manufactured goods. WalMart's "warehouse on wheels" will not be able to operate in a non-cheap oil economy
It will only take mild-to-moderate disruptions in the supply and price of gas to put WalMart and all operations like it out of business. And it will happen. As that occurs, America will have to make other arrangements for the distribution and sale of ordinary products.
It will have to be reorganized at the regional and the local scale. It will have to be based on moving merchandise shorter distances at multiple increments and probably by multiple modes of transport. It is almost certain to result in higher costs for the things we buy, and fewer choices of things. We are not going to rebuild the cheap oil manufacturing facilities of the 20th century.
We will have to recreate the lost infrastructures of local and regional commerce, and it will have to be multi-layered. These were the people that WalMart systematically put out of business over the last thirty years. The wholesalers, the jobbers, the small-retailers. They were economic participants in their communities; they made decisions that had to take the needs of their communities into account. they were employers who employed their neighbors. They were a substantial part of the middle-class of every community in America and all of them together played civic roles in our communities as the caretakers of institutions - the people who sat on the library boards, and the hospital boards, and bought the balls and bats and uniforms for the little league teams. We got rid of them in order to save nine bucks on a hair dryer. We threw away uncountable millions of dollars worth of civic amenity in order to shop at the Big Box discount stores. That was some bargain.This will all change. The future is telling us to prepare to do business locally again. It will not be a hyper-turbo-consumer economy. That will be over with. But we will still make things, and buy and sell things.
A lot of the knowledge needed to do local retail has been lost, because in the past the ownership of local retail businesses was often done by families. The knowledge and skills for doing it was transmitted from one generation to the next. It will not be so easy to get that back. But we have to do it.
Education is another system that will probably have to change. Our centralized schools are too big and too dependent on fleets of buses. Children will have to live closer to the schools they attend. School will have to be reorganized on a neighborhood basis, at a much smaller scale, in smaller buildings -- and they will not look like medium security prisons.
The psychology of previous investment is a huge obstacle to the reform of education. We poured fifty years of our national wealth into gigantic sprawling centralized schools - but that investment itself does not guarantee that these schools will be able to function in a future that works very differently.In the years ahead college will no longer be just another "consumer product." Fewer people will go to them. They will probably revert to their former status as elite institutions, whether we like it or not. Many of them will close altogether.
Change is coming whether we like it or not; whether we are prepared for it or not. If we don't begin right away to make better choices then we will face political, social, and economic disorders that will shake this nation to its foundation. I hope you will go back to your offices and classrooms and workplaces with these ideas in mind and think about what your roles will be in this challenging future. Good luck. Prepare for a different America, perhaps a better America. And prepare to be good neighbors.
End
Remarks in Hudson, NY
January 8, 2005
James Howard Kunstler
My last three books were concerned with the physical arrangement of life in our nation, in particular suburban sprawl, the most destructive development pattern the world has ever seen, and perhaps the greatest misallocation of resources the world has ever known.The world - and of course the US - now faces an epochal predicament: the global oil production peak and the arc of depletion that follows. We are unprepared for this crisis of industrial civilization. We are sleepwalking into the future.
The global peak oil production event will change everything about how we live. It will challenge all of our assumptions. It will compel us to do things differently - whether we like it or not.
Nobody knows for sure when the absolute peak year of global oil production will occur. You can only tell for sure in the "rear-view mirror," seeing the data after the fact. The US oil production peak in 1970 was not really recognized until the numbers came in over the next couple of years. By 1973 it was pretty clear that US oil production was in decline - the numbers were there for anyone to see, because the US oil industry was fairly transparent. They had to report their production to regulatory agencies. And low and behold American production was going down - despite the fact that we were selling more cars and more suburban houses. Of course we had been making up for falling production by increasing our oil imports.1973 was the yea r of the Yom Kippur War. With encouragement from the old Soviet Union, Syria and Egypt ganged up on Israel and after a rough start, Israel kicked their asses. The Islamic world was very ticked off - especially at the assistance that the US had given Israel in airlifted military equipment. So a lot of pressure was brought to bear on the leaders of the Arab oil states to punish the US and we got the famous OPEC embargo of 1973.
But it was more than that. The OPEC embargo was effective precisely because it was now recognized by everybody that the US had passed its all time oil production peak. We no longer had surplus capacity. We weren't the swing producer anymore, OPEC was. We were pumping flat-out just to stay in place, and depending on imports to make up for the rest.
That was a tectonic shift in world economics.
That's exactly when OPEC seized pricing control of the oil markets. We had a very rough decade. 20 percent interest rates. "Stagflation." High unemployment. Stock market in the toilet.
We had a second oil crisis in 1979 when the shah of Iran was overthrown. The 1970s closed on a note of desperation. Everything we did in America was tied to oil and foreigners were jerking our economy around, and it led the worst recession since the 1930s.
But we got over it and a lot of Americans drew the false conclusion that the these oil crises were a shuck and jive on the part of business and Arab oil sheiks.
How did we get over it? The oil crises of the 70s prompted a frantic era of drilling, and the last great oil discoveries came on line in the 1980s - chiefly the North Sea fields of England and Norway, and the Alaska fields of the North Slope and Prudhoe Bay. They literally saved the west's ass for 20 years. In fact, so much oil flowed out of them that the markets were glutted, and by the era of Bill Clinton, oil prices were headed down to as low as $10 a barrel.
It was all an illusion. The North Sea and Alaska are now well into depletion - they were drilled with the newest technology and - guess what - we depleted them more efficiently! England is now becoming a new oil importer again after a 20 year fiesta. The implications are very grim.
Now, some of the most knowledgeable geologists in the world believe we have reached the global oil production peak. Unlike the US oil industry, the foreign producers do not give out their production data so transparently. We may never actually see any reliable figures. The global production peak may only show up in the strange behavior of the markets.
The global peak is liable to manifest as a "bumpy plateau." Prices will wobble. Markets will wobble - as the oil markets have been doing the past year. International friction will increase, especially around the places where the oil is - and two-thirds of the world's remaining oil is in the states around the Persian Gulf where, every week, a half dozen US soldiers and many more Iraqis are getting blown up, beheaded, or shot.
The "bumpy plateau" is where all kind of market signals and political signals are telling you that "something is happening, Mr. Jones, but you don't know what it is." We'll only know in the rear-view mirror.
As of the past 12 months, Saudi Arabia seems to have lost the ability to function as 'swing producer.' The swing producer is the one with a lot of excess supply, who can just open the valves and let more oil out on the world markets, which inevitably drives the price down. Saudi Arabia has kept saying they would produce a million more barrels a day, but there's no evidence that they really have.
Well, the good news is that Saudi Arabia and OPEC can no longer set the price of oil. The bad news is that nobody can. When there is no production surplus in the world, that's a pretty good sign that the world is at peak.
Princeton Geologist Kenneth Deffeyes says that peak production will occur in 2005. We're there. Others, like Colin Campbell, former chief geologist for Shell Oil, put it more conservatively as between now and 2007. But by any measure of rational planning or policy-making, these differences are insignificant.
The meaning of the oil peak and its enormous implications are generally misunderstood even by those who have heard about it - and this includes the mainstream corporate media and the Americans who make plans or policy.
The world does not have to run out of oil or natural gas for severe instabilities, network breakdowns, and systems failures to occur. All that is necessary is for world production capacity to reach its absolute limit - a point at which no increased production is possible and the long arc of depletion commences, with oil production then falling by a few percentages steadily every year thereafter. That's the global oil peak: the end of absolute increased production and beginning of absolute declining production.
And, of course, as global oil production begins to steadily decline, year after year, the world population is only going to keep growing - at least for a while - and demand for oil will remain very robust. The demand line of the graph will pass the production line, and in doing so will set in motion all kinds of problems in the systems we rely on for daily life.
One huge implication of the oil peak is that industrial societies will never again enjoy the 2 to 7 percent annual economic growth that has been considered healthy for over 100 years. This amounts to the industrialized nations of the world finding themselves in a permanent depression.
Long before the oil actually depletes we will endure world-shaking political disturbances and economic disruptions. We will see globalism-in-reverse. Globalism was never an 'ism,' by the way. It was not a belief system. It was a manifestation of the 20-year-final-blowout of cheap oil. Like all economic distortions, it produced economic perversions. It allowed gigantic, predatory organisms like WalMart to spawn and reproduce at the expense of more cellular fine-grained economic communities.
The end of globalism will be hastened by international competition over the world's richest oil-producing regions.
We are already seeing the first military adventures over oil as the US attempts to pacify the Middle East in order to assure future supplies. This is by no means a project we can feel confident about. The Iraq war has only been the overture to more desperate contests ahead. Bear in mind that the most rapidly industrializing nation in the world, China, is geographically closer to Caspian Region and the Middle East than we are. The Chinese can walk into these regions, and someday they just might.In any case, and apart from the likelihood of military mischief, as the world passes the petroleum peak the global oil markets will destabilize and the industrial nations will have enormous problems with both price and supply. The effect on currencies and international finance will, of course, be equally severe.
Some of you may be aware that the US faces an imminent crisis with natural gas, at least as threatening as the problems we face over oil. By natural gas I mean methane, the stuff we run our furnaces and kitchen stoves on. Over the past two decades - in response to the OPEC embargoes of the 70s and the Chernobyl and Three Mile Island emergencies of the 80s -- we have so excessively shifted our electric power generation to dependence on natural gas that no amount of drilling can keep up with current demand. The situation is very ominous now.The United States, indeed North America, including Canada and Mexico, is technically way past peak production in natural gas and there is a special problem with gas that you don't have with oil: you tend to get your gas from the continent you are on. It comes out of the ground and is distributed around the continent in a pipeline network. If you have to get your natural gas from another continent, it has to be compressed at low temperature, transported in special ships with pressurized tanks, and delivered to special terminals where it is re-gasified. All this is tremendously more expensive than what we do now. Moreover, there are very few natural gas port terminals in the US and nobody wants them built anywhere near them because they are dangerous. They can blow up.We have been making up for our shortfall in gas in recent years by buying a lot of gas from Canada. The NAFTA treaty compels them to sell us their gas, and they are technically in depletion too. They're not happy about this.About half the houses in America are heated with natural gas. Nobody know what we are going to do when the depletion arc gets steeper.Oh, another problem with gas. The wells run dry just like this (snap!). Unlike oil wells, which go from gusher to steady stream to declining stream, gas wells either put out gas or they stop. And there's no warning when they are close to running out. Because, the gas is coming out of the ground under its own pressure. As the gas wells of North America continue to deplete, we will have little warning
Right here I am compelled to inform you that the prospects for alternative fuels are poor. We suffer from a kind of Jiminy Cricket syndrome in this country. We believe that if you wish for something, it will come true. Right now a lot of people - including people who ought to know better - are wishing for some miracle technology to save our collective ass.
There is not going to be a hydrogen economy. The hydrogen economy is a fantasy. It is not going to happen. We may be able to run a very few things on hydrogen - but we are not going to replace the entire US automobile fleet with hydrogen fuel cell cars.
" Getting hydrogen " Transport
Nor will we replace the current car fleet with electric cars or natural gas cars. We're just going to use cars a lot less. Fewer trips. Cars will be a diminished presence in our lives.Not to mention the political problem that kicks in when car ownership and driving becomes incrementally a more elite activity. The mass motoring society worked because it was so profoundly democratic. Practically anybody in America could participate, from the lowliest shlub mopping the floor at Pizza Hut to Bill Gates. What happens when it is no longer so democratic? And what is the tipping point at which it becomes a matter of political resentment: 12 percent? 23 percent? 38 percent?
Wind power and solar electric will not produce significant amounts of power within the context of the way we live now.
Ethanol and bio-deisel are a joke. They require more energy to produce than they give back. You know how you get ethanol: you produce massive amounts of corn using huge oil and gas 'inputs' of fertilizer and pesticide and then you use a lot more energy to turn the corn into ethanol. It's a joke.
No combination of alternative fuel systems currently known will allow us to run what we are running, the way we're running it, or even a substantial fraction of it.The future is therefore telling us very loudly that we will have to change the way we live in this country. The implications are clear: we will have to downscale and re-scale virtually everything we do.
The downscaling of America is a tremendous and inescapable project. It is the master ecological project of our time. We will have to do it whether we like it or not. We are not prepared.
Downscaling America doesn't mean we become a lesser people. It means that the scale at which we conduct the work of American daily life will have to be adjusted to fit the requirements of a post-globalist, post-cheap-oil age.We are going to have to live a lot more locally and a lot more intensively on that local level. Industrial agriculture, as represented by the Archer Daniels Midland / soda pop and cheez doodle model of doing things, will not survive the end of the cheap oil economy. The implication of this is enormous. Successful human ecologies in the near future will have to be supported by intensively farmed agricultural hinterlands. Places that can't do this will fail. Say goodbye to Phoenix and Las Vegas.
I'm not optimistic about most of our big cities. They are going to have to contract severely. They achieved their current scale during the most exuberant years of the cheap oil fiesta, and they will have enormous problems remaining viable afterward.Any mega-structure, whether it is a skyscraper or a landscraper - buildings that depend on huge amounts of natural gas and electricity - may not be usable a decade or two in the future.
What goes for the scale of places will be equally true for the scale of social organization. All large-scale enterprises, including many types of corporations and governments will function very poorly in the post-cheap oil world. Do not make assumptions based on things like national chain retail continuing to exist as it has.
Wal Mart is finished. [More below]
Many of my friends and colleagues live in fear of the federal government turning into Big Brother tyranny. I'm skeptical Once the permanent global energy crisis really gets underway, the federal government will be lucky if it can answer the phones. Same thing for Microsoft or even the Hannaford supermarket chain.
All indications are that American life will have to be reconstituted along the lines of traditional towns, villages, and cities much reduced in their current scale. These will be the most successful places once we are gripped by the profound challenge of a permanent reduced energy supply.The land development industry as we have known it is going to vanish in the years ahead. The production home-builders, as they like to call themselves. The strip mall developers. The fried food shack developers. Say goodbye to all that.
We are entering a period of economic hardship and declining incomes. The increment of new development will be very small, probably the individual building lot. The suburbs as are going to tank spectacularly. We are going to see an unprecedented loss of equity value and, of course, basic usefulness. We are going to see an amazing distress sale of properties, with few buyers. We're going to see a fight over the table scraps of the 20th century. We'll be lucky if the immense failure of suburbia doesn't result in an extreme political orgy of grievance and scapegoating.
The action in the years ahead will be in renovating existing towns and villages, and connecting them with regions of productive agriculture. Where the big cities are concerned, there is simply no historical precedent for the downscaling they will require. The possibilities for social and political distress ought to be obvious, though. The process is liable to be painful and disorderly.
The post cheap oil future will be much more about staying where you are than about being mobile. And, unless we rebuild a US passenger railroad network,a lot of people will not be going anywhere. Today, we have a passenger railroad system that the Bulgarians would be ashamed of.
Don't make too many plans to design parking structures. The post cheap oil world is not going to be about parking, either.
But it will be about the design and assembly and reconstituting of places that are worth caring about and worth being in. When you have to stay where you are and live locally, you will pay a lot more attention to the quality of your surroundings, especially if you are not moving through the landscape at 50 miles-per-hour.
Some regions of the country will do better than others. The sunbelt will suffer in exact proportion to the degree that it prospered artificially during the cheap oil blowout of the late 20th century. I predict that the Southwest will become substantially depopulated, since they will be short of water as well as gasoline and natural gas. I'm not optimistic about the Southeast either, for different reasons. I think it will be subject to substantial levels of violence as the grievances of the formerly middle class boil over and combine with the delusions of Pentecostal Christian extremism.
All regions of the nation will be affected by the vicissitudes of this Long Emergency, but I think New England and the Upper Midwest have somewhat better prospects. I regard them as less likely to fall into lawlessness, anarchy, or despotism, and more likely to salvage the bits and pieces of our best social traditions and keep them in operation at some level.
There is a fair chance that the nation will disaggregate into autonomous regions before the 21st century is over, as a practical matter if not officially. Life will be very local.
These challenges are immense. We will have to rebuild local networks of economic and social relations that we allowed to be systematically dismantled over the past fifty years. In the process, our communities may be able to reconstitute themselves.
The economy of the mid 21st century may center on agriculture. Not information. Not the digital manipulation of pictures, not services like selling cheeseburgers and entertaining tourists. Farming. Food production. The transition to this will be traumatic, given the destructive land-use practices of our time, and the staggering loss of knowledge. We will be lucky if we can feed ourselves.
The age of the 3000-mile-caesar salad will soon be over. Food production based on massive petroleum inputs, on intensive irrigation, on gigantic factory farms in just a few parts of the nation, and dependent on cheap trucking will not continue. We will have to produce at least some of our food closer to home. We will have to do it with fewer fossil-fuel-based fertilizers and pesticides on smaller-scaled farms. Farming will have to be much more labor-intensive than it is now. We will see the return of an entire vanished social class - the homegrown American farm laboring class.
N
We are going to have to reorganize everyday commerce in this nation from the ground up. The whole system of continental-scale big box discount and chain store shopping is headed for extinction, and sooner than you might think. It will go down fast and hard. Americans will be astonished when it happens.
Operations like WalMart have enjoyed economies of scale that were attained because of very special and anomalous historical circumstances: a half century of relative peace between great powers. And cheap oil - absolutely reliable supplies of it, since the OPEC disruptions of the 1970s. WalMart and its imitators will not survive the oil market disruptions to come. Not even for a little while. WalMart will not survive when its merchandise supply chains to Asia are interrupted by military contests over oil or internal conflict in the nations that have been supplying us with ultra-cheap manufactured goods. WalMart's "warehouse on wheels" will not be able to operate in a non-cheap oil economy
It will only take mild-to-moderate disruptions in the supply and price of gas to put WalMart and all operations like it out of business. And it will happen. As that occurs, America will have to make other arrangements for the distribution and sale of ordinary products.
It will have to be reorganized at the regional and the local scale. It will have to be based on moving merchandise shorter distances at multiple increments and probably by multiple modes of transport. It is almost certain to result in higher costs for the things we buy, and fewer choices of things. We are not going to rebuild the cheap oil manufacturing facilities of the 20th century.
We will have to recreate the lost infrastructures of local and regional commerce, and it will have to be multi-layered. These were the people that WalMart systematically put out of business over the last thirty years. The wholesalers, the jobbers, the small-retailers. They were economic participants in their communities; they made decisions that had to take the needs of their communities into account. they were employers who employed their neighbors. They were a substantial part of the middle-class of every community in America and all of them together played civic roles in our communities as the caretakers of institutions - the people who sat on the library boards, and the hospital boards, and bought the balls and bats and uniforms for the little league teams. We got rid of them in order to save nine bucks on a hair dryer. We threw away uncountable millions of dollars worth of civic amenity in order to shop at the Big Box discount stores. That was some bargain.This will all change. The future is telling us to prepare to do business locally again. It will not be a hyper-turbo-consumer economy. That will be over with. But we will still make things, and buy and sell things.
A lot of the knowledge needed to do local retail has been lost, because in the past the ownership of local retail businesses was often done by families. The knowledge and skills for doing it was transmitted from one generation to the next. It will not be so easy to get that back. But we have to do it.
Education is another system that will probably have to change. Our centralized schools are too big and too dependent on fleets of buses. Children will have to live closer to the schools they attend. School will have to be reorganized on a neighborhood basis, at a much smaller scale, in smaller buildings -- and they will not look like medium security prisons.
The psychology of previous investment is a huge obstacle to the reform of education. We poured fifty years of our national wealth into gigantic sprawling centralized schools - but that investment itself does not guarantee that these schools will be able to function in a future that works very differently.In the years ahead college will no longer be just another "consumer product." Fewer people will go to them. They will probably revert to their former status as elite institutions, whether we like it or not. Many of them will close altogether.
Change is coming whether we like it or not; whether we are prepared for it or not. If we don't begin right away to make better choices then we will face political, social, and economic disorders that will shake this nation to its foundation. I hope you will go back to your offices and classrooms and workplaces with these ideas in mind and think about what your roles will be in this challenging future. Good luck. Prepare for a different America, perhaps a better America. And prepare to be good neighbors.
End
Wednesday, August 24, 2005
The Clusterfuck Nation Manifesto
Strategies for Survival
Notes on the Coming Transformation of American Life
by Jim Kunstler
I get e-mail from people who object to what they construe to be an excessively pessimistic view of our national scene. Well, what if you suggested to the people of Germany in 1936 that Dresden would be turned into an ashtry within a decade and that Berliners would cut down all the trees in the Tiergarten to heat their homes?
What I've been suggesting about the direction of our country is hardly that drastic.
I personally believe that there is much we can do as a nation, and as a collection of communities, to mitigate the problems I have been describing, even to create conditions in which American civilization can advance beyond the hardships of the early 21st century.
The overriding imperative task for us in the face of the problems ahead will be the downscaling of virtually all activities in America. This should not be misunderstood. I do not mean that we ought to become any less of a nation, or less of a democracy, only that the scale at which we conduct the work of American life will have to be adjusted to fit the requirements of a post-globalist, post-cheap-oil age. The future is already telling us very clearly what must be done. If we fail to pay attention, we risk very costly distraction in political turmoil, military mischief, civil disturbance, and permanent economic loss.
I will focus here on examples of three national "systems," so to speak, that will have to be downscaled sooner rather than later: retail trade, agriculture, and schooling.
America made the unfortunate choice (by inattention, really) of allowing nearly all of its retail trade to be consolidated by a very few huge national operations, the Wal-Marts and other gigantic discounters. Many Americans viewed this as a bonanza of bargain shopping without noticing the significant losses and costs entailed to their communities, and to the long-term health of their nation's economy. I have described the extreme vulnerability of the giant national retail operations to the vicissitudes ahead: disrupted oil markets, far-flung supply chains, and so forth. When these behemoths go down - and they will go down hard and fast - everyday retail trade will have to be reorganized in America. This is a tremendous task.
It will have to be reorganized at the local and regional scale. It will have to be based on moving merchandise shorter distances at multiple increments and probably by multiple modes of transport. It is almost certain to result in higher costs for the things we buy - which is another way of stating we face a period of austerity - but it is apt to bring back many lost civic benefits in return. The national chains eliminated practically all the "middlemen," who were disparaged as parasites adding needless costs to everyday products. The fact is that these middlemen, the wholesalers, jobbers, warehousers, distributors, played necessary roles in a complex system that operated very differently than the current model. They were members of local communities; they were economic participants in their communities; they made decisions that had to take the needs of their communities into account; they were caretakers of civic institutions, and they were employers. We will need this category of business person again, as we will need the local retailer, the persons and families who run local businesses trading with the public at large. We will need a multi-layered system for the distribution of regular goods, even if it costs more to operate.
Some of the infrastructure needed to re-localize American commerce is there, though it is not in very good shape - the urban downtowns, small town main streets and business districts. Some of the big boxes might be integrated with it - dead Kmarts may be the local warehouses of the future, and some shopping centers and malls may be retrofitted into neighborhood centers - but much of this newer car-oriented fabric will more likely end up as salvage. The railroad system the US needs to replace the long-haul trucking system that we have relied on for decades is also in poor shape, but railroad track is much easier to repair and restore per mile than comparable amounts of interstate highway. Perhaps our biggest problem is that so many products we're accustomed to are no longer manufactured in the United States. The factories themselves have physically disappeared. Hence, another feature of the years ahead: for a period of time, Americans may have to make do with a lot less and with smaller selections of fewer products. This is another reason to regard the coming era as one of austerity.
It would be a mistake to take this view of the coming decades as nostalgic. The future will simply demand it. I happen to believe that there is much to gain in amenity from the downscaling of American life. We will benefit from knowing the people we do business with. There is a good chance that many people currently underemployed will find a gainful niche to occupy in the reorganization of American trade, and communities will benefit from their being gainfully occupied. But at the same time, we will be saying goodbye to a way of life which, however unsustainable and even crazy it might have been, was a set of arrangements we had grown accustomed to, and it is never easy for a culture to change the way it does things as fundamental as everyday commerce.
Agriculture faces a similar predicament. Today, we grow a few monocultures of grain or milk or beef or pork in vast quantities on gigantic factory farms, process most of the outputs at a similar enormous scale, and truck it great distances to gigantic super-stores. The end of cheap oil means this will no longer be possible. We are going to have to grow at least some of our food closer to home. We will have to do it with fewer petroleum inputs, the fossil-fuel-based fertilizers and pesticides. Our methods will have to be along lines that are today labeled as "organic." Farming will have to be done at a smaller scale, and it will probably entail more intensive human labor. A class of people will re-emerge on the scene: American agricultural laborers. Their lives will probably be far from idyllic. Don't count on this kind of work being done by foreign migrants when we are engaged in border disputes and demographic / territorial contests with Mexico. When the US economy shudders and stumbles, life will become worse by orders of magnitude in Mexico, which is already struggling.
The re-localization of farming in America is going to be very difficult. Our relationship with land the past half century has been one almost exclusively of brutal commodity exploitation. A lot of farmland in California is close to being ruined from over-irrigation; you can see the salt precipitates in the fields off Interstate Five in the Central Valley today. Some of the best eastern farmland has been paved over. The years ahead will require us to rediscover a relationship of caring for land and doing so by hand, tenderly. In an age when the farmland around our towns and cities seemed to have value only as potential development - for monocultures of suburban houses and discount shopping - stewardship was regarded as merely prissy. In the future, our lives will depend on how we take care of the land.
The re-localization of agriculture presumes that many so-called value-added activities will take place on a more local and regional basis, too: the conversion of milk into dairy products, the production of meats, hams, sausages, wine, preserved foods, and so on. Europeans never stopped doing this. Their models and methods exist to be emulated, and we will have to do it as the end of globalism becomes a more emphatic condition of life. Today, there are probably fewer than fifty immense factories producing most of the cheese in America, all absolutely dependent on long-haul trucking based on cheap diesel fuel. Twenty years in the future, there may be thousands of smaller dairies operating across the US. They will probably put out better products. They will employ people in complex vocations. They will have regional differences.
The downscaling of agriculture presents some obvious problems. Farms take years to establish. The knowledge for running diverse, small-scale farms becomes a little more lost every day as elderly farmers die and the culture of farming dies with them. Theend of the cheap oil economy may bring dysfunction so swiftly to our current arrangements that we will not have time to make an orderly transition. This could result in a specific food emergency in the US that might go on for years. As the Chinese proverb goes: a well-fed person may have many problems but a starving person only has one problem - another reason to be prepared for political strife here in the US. In the meantime, we may see swiss chard and potatoes sprout where formerly the monocultures of Kentucky bluegrass, stoked by oil-based turf-builders, grew so luxuriantly on the lawns of suburbia.
School, is another major system facing drastic reorganization. The failure of schooling in America is already manifest. Our inner-city schools are in nearly complete state of entropy due to the effects of our overall disinvestment in cities - the school buildings themselves are crumbling while books and supplies are beyond the point of critical shortage - and to an array of social conditions ranging from the disintegration of families to the absence of standards of normative behavior. Whether these might all be lumped together as the consequences of poverty is debatable, in my opinion, but the effects are not debatable. These schools are not producing literate citizens with adequate social skills.
Gigantic alienating schools are producing so much anxiety and depression that multiple slayings have occurred at regular intervals in recent years.
Our schools are too big. The centralized suburban schools with their fleets of buses will become rapidly obsolete when the first oil market disruptions occur. The inner city schools will be too broken to fix. The suburban schools will be too large to heat economically (especially since the overwhelming majority of them all over the nation, regardless of climate, are sprawling one-story modernist boxes). School will have to be reorganized on a local basis, at a much smaller scale, in smaller buildings that do not look like medium security prisons. School will be required for fewer years, and with more deliberate sorting of children into academic and vocational tracks. Children will have to live closer to the schools they attend - the yellow bus fleets will be history. Children and teachers will benefit from being in physically smaller institutions where all will at least have the chance to know one another. In a post-cheap-oil world, teens might be needed to work part of the day or part of the year.
Leon Botstein, President of Bard College and one of the leading reformers of education in America, has argued that people need to finish regular school by age 16 and assume a new set of responsibilities to increase their sense of adulthood.13 He advocates abolishing high school as it is now known altogether. Years from now fewer will go on to college. Colleges, too, are likely to go through severe downsizing, especially the enormous state universities, as college ceases to be a mass consumer activity. Real life may not be so easily postponable. Vocational trades requiring real skills may gain in status and some professions such as law may lose status (and earning power). Some occupations - public relations, travel agentry, authoring books - may shrink or disappear altogether. Work for many may become a matter of making oneself useful to others with the added benefit of earning a living.
One hazard to the enterprise of reforming education will be the psychology of previous investment. We have poured our accumulated national wealth into building gigantic central schools and galactic-scale university campuses, with their semi-professional sports facilities and vast parking lots, and there will be a tendency to try to make them work no matter what conditions prevail in the real world. But circumstances will demand nonetheless that we change.
What is liable to happen to these three major activities, retail, agriculture, and school is also true of virtually all other things we do in the US. Everything you can imagine from banking to real estate development to church-going to professional sports will have to reduce its scale and scope of operation or fail. The problems ahead will compel us to move from being a culture of quantity to a culture of quality. We will have to make do with fewer and less, and we can compensate by demanding that it be finer. We will have to live locally and we can benefit from the restoration of robust civic relations.
Many of the beliefs and accepted dogmas of the late 20th century will fall away as a new and very different reality asserts itself. Cultural relativism will be discredited in an era when it becomes necessary, even for intellectuals, to make distinctions between good and bad, between excellence and worthlessness - because our lives may depend on the ability to make these distinctions. Hierarchies of value will become normative. Elitism will no longer be a pejorative but rather a recognition that some things really are better than other things.
Strategies for Survival
Notes on the Coming Transformation of American Life
by Jim Kunstler
I get e-mail from people who object to what they construe to be an excessively pessimistic view of our national scene. Well, what if you suggested to the people of Germany in 1936 that Dresden would be turned into an ashtry within a decade and that Berliners would cut down all the trees in the Tiergarten to heat their homes?
What I've been suggesting about the direction of our country is hardly that drastic.
I personally believe that there is much we can do as a nation, and as a collection of communities, to mitigate the problems I have been describing, even to create conditions in which American civilization can advance beyond the hardships of the early 21st century.
The overriding imperative task for us in the face of the problems ahead will be the downscaling of virtually all activities in America. This should not be misunderstood. I do not mean that we ought to become any less of a nation, or less of a democracy, only that the scale at which we conduct the work of American life will have to be adjusted to fit the requirements of a post-globalist, post-cheap-oil age. The future is already telling us very clearly what must be done. If we fail to pay attention, we risk very costly distraction in political turmoil, military mischief, civil disturbance, and permanent economic loss.
I will focus here on examples of three national "systems," so to speak, that will have to be downscaled sooner rather than later: retail trade, agriculture, and schooling.
America made the unfortunate choice (by inattention, really) of allowing nearly all of its retail trade to be consolidated by a very few huge national operations, the Wal-Marts and other gigantic discounters. Many Americans viewed this as a bonanza of bargain shopping without noticing the significant losses and costs entailed to their communities, and to the long-term health of their nation's economy. I have described the extreme vulnerability of the giant national retail operations to the vicissitudes ahead: disrupted oil markets, far-flung supply chains, and so forth. When these behemoths go down - and they will go down hard and fast - everyday retail trade will have to be reorganized in America. This is a tremendous task.
It will have to be reorganized at the local and regional scale. It will have to be based on moving merchandise shorter distances at multiple increments and probably by multiple modes of transport. It is almost certain to result in higher costs for the things we buy - which is another way of stating we face a period of austerity - but it is apt to bring back many lost civic benefits in return. The national chains eliminated practically all the "middlemen," who were disparaged as parasites adding needless costs to everyday products. The fact is that these middlemen, the wholesalers, jobbers, warehousers, distributors, played necessary roles in a complex system that operated very differently than the current model. They were members of local communities; they were economic participants in their communities; they made decisions that had to take the needs of their communities into account; they were caretakers of civic institutions, and they were employers. We will need this category of business person again, as we will need the local retailer, the persons and families who run local businesses trading with the public at large. We will need a multi-layered system for the distribution of regular goods, even if it costs more to operate.
Some of the infrastructure needed to re-localize American commerce is there, though it is not in very good shape - the urban downtowns, small town main streets and business districts. Some of the big boxes might be integrated with it - dead Kmarts may be the local warehouses of the future, and some shopping centers and malls may be retrofitted into neighborhood centers - but much of this newer car-oriented fabric will more likely end up as salvage. The railroad system the US needs to replace the long-haul trucking system that we have relied on for decades is also in poor shape, but railroad track is much easier to repair and restore per mile than comparable amounts of interstate highway. Perhaps our biggest problem is that so many products we're accustomed to are no longer manufactured in the United States. The factories themselves have physically disappeared. Hence, another feature of the years ahead: for a period of time, Americans may have to make do with a lot less and with smaller selections of fewer products. This is another reason to regard the coming era as one of austerity.
It would be a mistake to take this view of the coming decades as nostalgic. The future will simply demand it. I happen to believe that there is much to gain in amenity from the downscaling of American life. We will benefit from knowing the people we do business with. There is a good chance that many people currently underemployed will find a gainful niche to occupy in the reorganization of American trade, and communities will benefit from their being gainfully occupied. But at the same time, we will be saying goodbye to a way of life which, however unsustainable and even crazy it might have been, was a set of arrangements we had grown accustomed to, and it is never easy for a culture to change the way it does things as fundamental as everyday commerce.
Agriculture faces a similar predicament. Today, we grow a few monocultures of grain or milk or beef or pork in vast quantities on gigantic factory farms, process most of the outputs at a similar enormous scale, and truck it great distances to gigantic super-stores. The end of cheap oil means this will no longer be possible. We are going to have to grow at least some of our food closer to home. We will have to do it with fewer petroleum inputs, the fossil-fuel-based fertilizers and pesticides. Our methods will have to be along lines that are today labeled as "organic." Farming will have to be done at a smaller scale, and it will probably entail more intensive human labor. A class of people will re-emerge on the scene: American agricultural laborers. Their lives will probably be far from idyllic. Don't count on this kind of work being done by foreign migrants when we are engaged in border disputes and demographic / territorial contests with Mexico. When the US economy shudders and stumbles, life will become worse by orders of magnitude in Mexico, which is already struggling.
The re-localization of farming in America is going to be very difficult. Our relationship with land the past half century has been one almost exclusively of brutal commodity exploitation. A lot of farmland in California is close to being ruined from over-irrigation; you can see the salt precipitates in the fields off Interstate Five in the Central Valley today. Some of the best eastern farmland has been paved over. The years ahead will require us to rediscover a relationship of caring for land and doing so by hand, tenderly. In an age when the farmland around our towns and cities seemed to have value only as potential development - for monocultures of suburban houses and discount shopping - stewardship was regarded as merely prissy. In the future, our lives will depend on how we take care of the land.
The re-localization of agriculture presumes that many so-called value-added activities will take place on a more local and regional basis, too: the conversion of milk into dairy products, the production of meats, hams, sausages, wine, preserved foods, and so on. Europeans never stopped doing this. Their models and methods exist to be emulated, and we will have to do it as the end of globalism becomes a more emphatic condition of life. Today, there are probably fewer than fifty immense factories producing most of the cheese in America, all absolutely dependent on long-haul trucking based on cheap diesel fuel. Twenty years in the future, there may be thousands of smaller dairies operating across the US. They will probably put out better products. They will employ people in complex vocations. They will have regional differences.
The downscaling of agriculture presents some obvious problems. Farms take years to establish. The knowledge for running diverse, small-scale farms becomes a little more lost every day as elderly farmers die and the culture of farming dies with them. Theend of the cheap oil economy may bring dysfunction so swiftly to our current arrangements that we will not have time to make an orderly transition. This could result in a specific food emergency in the US that might go on for years. As the Chinese proverb goes: a well-fed person may have many problems but a starving person only has one problem - another reason to be prepared for political strife here in the US. In the meantime, we may see swiss chard and potatoes sprout where formerly the monocultures of Kentucky bluegrass, stoked by oil-based turf-builders, grew so luxuriantly on the lawns of suburbia.
School, is another major system facing drastic reorganization. The failure of schooling in America is already manifest. Our inner-city schools are in nearly complete state of entropy due to the effects of our overall disinvestment in cities - the school buildings themselves are crumbling while books and supplies are beyond the point of critical shortage - and to an array of social conditions ranging from the disintegration of families to the absence of standards of normative behavior. Whether these might all be lumped together as the consequences of poverty is debatable, in my opinion, but the effects are not debatable. These schools are not producing literate citizens with adequate social skills.
Gigantic alienating schools are producing so much anxiety and depression that multiple slayings have occurred at regular intervals in recent years.
Our schools are too big. The centralized suburban schools with their fleets of buses will become rapidly obsolete when the first oil market disruptions occur. The inner city schools will be too broken to fix. The suburban schools will be too large to heat economically (especially since the overwhelming majority of them all over the nation, regardless of climate, are sprawling one-story modernist boxes). School will have to be reorganized on a local basis, at a much smaller scale, in smaller buildings that do not look like medium security prisons. School will be required for fewer years, and with more deliberate sorting of children into academic and vocational tracks. Children will have to live closer to the schools they attend - the yellow bus fleets will be history. Children and teachers will benefit from being in physically smaller institutions where all will at least have the chance to know one another. In a post-cheap-oil world, teens might be needed to work part of the day or part of the year.
Leon Botstein, President of Bard College and one of the leading reformers of education in America, has argued that people need to finish regular school by age 16 and assume a new set of responsibilities to increase their sense of adulthood.13 He advocates abolishing high school as it is now known altogether. Years from now fewer will go on to college. Colleges, too, are likely to go through severe downsizing, especially the enormous state universities, as college ceases to be a mass consumer activity. Real life may not be so easily postponable. Vocational trades requiring real skills may gain in status and some professions such as law may lose status (and earning power). Some occupations - public relations, travel agentry, authoring books - may shrink or disappear altogether. Work for many may become a matter of making oneself useful to others with the added benefit of earning a living.
One hazard to the enterprise of reforming education will be the psychology of previous investment. We have poured our accumulated national wealth into building gigantic central schools and galactic-scale university campuses, with their semi-professional sports facilities and vast parking lots, and there will be a tendency to try to make them work no matter what conditions prevail in the real world. But circumstances will demand nonetheless that we change.
What is liable to happen to these three major activities, retail, agriculture, and school is also true of virtually all other things we do in the US. Everything you can imagine from banking to real estate development to church-going to professional sports will have to reduce its scale and scope of operation or fail. The problems ahead will compel us to move from being a culture of quantity to a culture of quality. We will have to make do with fewer and less, and we can compensate by demanding that it be finer. We will have to live locally and we can benefit from the restoration of robust civic relations.
Many of the beliefs and accepted dogmas of the late 20th century will fall away as a new and very different reality asserts itself. Cultural relativism will be discredited in an era when it becomes necessary, even for intellectuals, to make distinctions between good and bad, between excellence and worthlessness - because our lives may depend on the ability to make these distinctions. Hierarchies of value will become normative. Elitism will no longer be a pejorative but rather a recognition that some things really are better than other things.
Poster from WorldChanging.com:
You know people had the exact same kinds of reactions and the same types of discussions back when cars and electricity and cities were taking over from horses gas/candle lights and towns and villages.
How ever will we afford such a monsterous change? How can we do without horses after all cars are not anywhere near affordable nor dependable nor useful enough to suplant the horse any time soon. As for elctricity.. we all know how much that wound up costing.. hell we havnt even yet electrified every place even in america... and a drastic change in where and how you live.... cities terrified people as to be blunt most cities of the day were deathtraps and unholy bastions of disease death and worse.
And now again we are at a time when our old systems are failing us and the new are ... less then perfect.. and again its gona be very interesting times. I personaly am glad im alive now.
Its not a question of will we make it and will it work its just a question of whos left alive after the dust settles and what new future are we who are left gona be living in?
My personal expectations are that a whole lota people will die in the process but that the future will be alot better then the present.
You know people had the exact same kinds of reactions and the same types of discussions back when cars and electricity and cities were taking over from horses gas/candle lights and towns and villages.
How ever will we afford such a monsterous change? How can we do without horses after all cars are not anywhere near affordable nor dependable nor useful enough to suplant the horse any time soon. As for elctricity.. we all know how much that wound up costing.. hell we havnt even yet electrified every place even in america... and a drastic change in where and how you live.... cities terrified people as to be blunt most cities of the day were deathtraps and unholy bastions of disease death and worse.
And now again we are at a time when our old systems are failing us and the new are ... less then perfect.. and again its gona be very interesting times. I personaly am glad im alive now.
Its not a question of will we make it and will it work its just a question of whos left alive after the dust settles and what new future are we who are left gona be living in?
My personal expectations are that a whole lota people will die in the process but that the future will be alot better then the present.
Poster from Clusterfuck Nation
...a long time lurker now moved to jump in. i find xenotype's comments to be thoughtful and wise, and pretty much right on the money. (s)he cautions us about our eagerness to see 80% human die-off. so now, paradoxically, while i don't wish for that eventuality either, i do wish to "come out", as it were, and admit that i do indeed want many of the prevailing systems and metasystems to break down, and the sooner the better. my suspicion is that many other observers of these issues secretly share my wish (including ol' mr. K.), but can't or won't admit it, to others if not to themselves.
i not only wish this but believe that a case can be made that such breakdown is the shortest and clearest path to a second chance for modern humanity.
none of us know what breakdown will lead to after the dust settles. there is a tantalizing possibility suggested by chaos theory: (and i'll cop to the fact that i'm skating uncomfortably close to the edge of my understanding about this theorem; corrections are welcome). complex systems at the edge of chaos can spontaneously "flip" upward into a higher level of organization. does anyone else here sense that the interesting times we are in hold as much promise for leapfrog advancements on many levels as for cataclysmic collapses....and that these possibilities may in fact be two sides of the same coin? could it be that we don't get the possibility of exhilarating ascent without the equal possibility of terrifying collapse? or even more to the point, that we get them both, playing out in real time, simultaneously?
...a long time lurker now moved to jump in. i find xenotype's comments to be thoughtful and wise, and pretty much right on the money. (s)he cautions us about our eagerness to see 80% human die-off. so now, paradoxically, while i don't wish for that eventuality either, i do wish to "come out", as it were, and admit that i do indeed want many of the prevailing systems and metasystems to break down, and the sooner the better. my suspicion is that many other observers of these issues secretly share my wish (including ol' mr. K.), but can't or won't admit it, to others if not to themselves.
i not only wish this but believe that a case can be made that such breakdown is the shortest and clearest path to a second chance for modern humanity.
none of us know what breakdown will lead to after the dust settles. there is a tantalizing possibility suggested by chaos theory: (and i'll cop to the fact that i'm skating uncomfortably close to the edge of my understanding about this theorem; corrections are welcome). complex systems at the edge of chaos can spontaneously "flip" upward into a higher level of organization. does anyone else here sense that the interesting times we are in hold as much promise for leapfrog advancements on many levels as for cataclysmic collapses....and that these possibilities may in fact be two sides of the same coin? could it be that we don't get the possibility of exhilarating ascent without the equal possibility of terrifying collapse? or even more to the point, that we get them both, playing out in real time, simultaneously?
Tuesday, August 23, 2005
news release: Gasoline Price Reflects Dwindling Global Oil Reserves, Not Merely Oil Price
Written by Jan Lundberg
Editorial note: Being misinformed is common, but sometimes it is due to dysinformation from the industrial state. The public is kept from knowing about peak oil and the full implications including petrocollapse and a new paradigm to follow. As long as money is a society's raison d'etre, and no opposition movement arises, we are driving over the ecological cliff like motorized lemmings. This news release attempts to set the record straight about record gasoline prices, and offer a real solution. - JL
Berkeley, Aug. 15 - Jan Lundberg, veteran petroleum analyst who joined the environmental movement and fought industry expansion, has a different explanation for record gasoline prices than the one provided by his former firm, Lundberg Survey, which on Aug. 14 attributed them only to high crude oil prices.
"The peak of world oil extraction is approximately now, although reserves data from the oil industry and OPEC are notoriously unreliable. Shortage of crude oil has started to make itself felt, as strained production levels of the most useful crudes reflect tight supply. It is true that oil demand has managed to reach record levels (82.2 million barrels a day; source: IEA), but oil fields inevitably peter out," he told Fox News Radio on Sunday.
Nearly 20 oil-exporting countries are past their peak in production. Also, Saudi Arabia is showing signs of leveling off. Another sign of dwindling geological resources is when industry does not invest in drilling new wells - despite record profits for oil - and rather buys up oil reserves via corporate mergers. "Refining capacity is almost maxed out, but industry sees little point in building more refineries when crude supply is in doubt," Lundberg added. World discoveries peaked by 1965, and the trend in declining discovery is unalterable. U.S. production peaked in 1970.
"Growth of the economy ends when petroleum is in short supply. When the market really feels the gap between supply and demand widen, the price will go through the roof. Alternative energy sources are not ready. The coming oil shock will signal an historic flip-over from expanding our civilization via petroleum dependence to seeing the commencement - after "petrocollapse" - of a reversion to sustainable living based on local ecological capacity. The short answer to 'What do we do now?' is conserve, radically."
Lundberg also told Fox News that it is erroneous to calculate that the adjusted price for gasoline, including inflation, is under the price of two and a half decades ago. This is because "subsidies - direct, indirect and hidden, such as the War on Iraq -- to oil and refined products, if included in the price, would make oil cost perhaps $120 per barrel today. This is one reason people must work longer hours and obtain extra jobs," he explained.
Written by Jan Lundberg
Editorial note: Being misinformed is common, but sometimes it is due to dysinformation from the industrial state. The public is kept from knowing about peak oil and the full implications including petrocollapse and a new paradigm to follow. As long as money is a society's raison d'etre, and no opposition movement arises, we are driving over the ecological cliff like motorized lemmings. This news release attempts to set the record straight about record gasoline prices, and offer a real solution. - JL
Berkeley, Aug. 15 - Jan Lundberg, veteran petroleum analyst who joined the environmental movement and fought industry expansion, has a different explanation for record gasoline prices than the one provided by his former firm, Lundberg Survey, which on Aug. 14 attributed them only to high crude oil prices.
"The peak of world oil extraction is approximately now, although reserves data from the oil industry and OPEC are notoriously unreliable. Shortage of crude oil has started to make itself felt, as strained production levels of the most useful crudes reflect tight supply. It is true that oil demand has managed to reach record levels (82.2 million barrels a day; source: IEA), but oil fields inevitably peter out," he told Fox News Radio on Sunday.
Nearly 20 oil-exporting countries are past their peak in production. Also, Saudi Arabia is showing signs of leveling off. Another sign of dwindling geological resources is when industry does not invest in drilling new wells - despite record profits for oil - and rather buys up oil reserves via corporate mergers. "Refining capacity is almost maxed out, but industry sees little point in building more refineries when crude supply is in doubt," Lundberg added. World discoveries peaked by 1965, and the trend in declining discovery is unalterable. U.S. production peaked in 1970.
"Growth of the economy ends when petroleum is in short supply. When the market really feels the gap between supply and demand widen, the price will go through the roof. Alternative energy sources are not ready. The coming oil shock will signal an historic flip-over from expanding our civilization via petroleum dependence to seeing the commencement - after "petrocollapse" - of a reversion to sustainable living based on local ecological capacity. The short answer to 'What do we do now?' is conserve, radically."
Lundberg also told Fox News that it is erroneous to calculate that the adjusted price for gasoline, including inflation, is under the price of two and a half decades ago. This is because "subsidies - direct, indirect and hidden, such as the War on Iraq -- to oil and refined products, if included in the price, would make oil cost perhaps $120 per barrel today. This is one reason people must work longer hours and obtain extra jobs," he explained.
Oil Shortages Look Certain by 2007
- LNG to the Rescue?
Gas Shortages Are Most Pressing, But Economics Shows No Easy Answers
Why The Oil Markets May See Price Dips Before The Collapse and Why This Will Make the Outcomes Worse
by
Dale Allen Pfeiffer -- FTW Energy Editor
© Copyright 2004, From The Wilderness Publications, www.fromthewilderness.com. All Rights Reserved. May be reprinted, distributed or posted on an Internet web site for non-profit purposes only.
[Suddenly, Peak Oil and Gas issues are everywhere. It's as if the light bulb is going on a day late and a tank or two short. ABC News, The Petroleum Review, BBC, Wall Street and many other “establishment” voices are beginning to sound the alarm. For North A merica, natural gas shortages are here now and can only worsen. The oil production numbers are bearing out that by 2007 demand will have permanently exceeded supply and production capacity. In both cases the outlook is not good. For natural gas the only solution is the importation of liquefied natural gas or LNG. The costs, dangers, political opposition and international competition for dwindling supplies create a complex calculus that will be exceptionally difficult to solve.
The picture for oil is worsened by the way the oil markets operate. Oil prices are driven only by very short-term criteria, essentially how much oil is in the pipeline for the next few months. The last so-called mega fields – really only a few months supply in the global picture -- are scheduled to come on line in 2005 creating a short term glut even as the industry acknowledges that the cheap oil is gone forever. The result will be that the capital needed to build infrastructure or switch to alternatives will not be available as the last crucial window of opportunity for its use begins to close. Without that timely capital, there will be no brakes when petroleum civilization hits the wall.
Dale Allen Pfeiffer deconstructs the market forces as mankind stands on the brink of a new dark age. – MCR]
______
February 19, 2004, 1800 PST (FTW ) -- In previous articles, we drew a picture of North American natural gas (NG) poised to fall off the cliff of declining production. In order to maintain a healthy economy, our natural gas consumption – primarily for the generation of electricity – must grow by 35 to 50% before the end of the decade. The North American NG supply is in decline and has already fallen behind demand. Homes must have heat in the winter. In the US, 60% of all homes are heated by NG, and that ratio is increasing, as over 70% of new homes require NG for heating.1 Natural gas is the intended fuel of virtually all new power generation projects within the US. By 2002, 90% of all new power plants were gas-fired.2 All of the industrial users with the ability to move production or shift to other fuel sources have done so. There is little room left for fuel switching. How then to make up the shortfall?
Opening up pipelines from Alaska (ANWR) and Northern Canada will take several years and will not make up for the deficit between traditional production and demand. It is more than likely that any production carried along a Canadian pipeline would be diverted to Canadian tar sands refining, which involves the use of high-pressure steam (heated by gas) to wash heavy oil from sand. Opening sanctioned areas of the Rockies and the Outer Continental Shelf would help, though NG reserves in both areas are likely to deplete quickly. Geologist Walter Youngquist and electrical engineer Richard Duncan pointed out in a recent study that new NG wells are showing decline rates as high as 80% in the first year. Over the past decade, the amount of gas found per foot drilled has declined by 50%.3
In examining the situation and looking over the optional sources of NG to make up the shortfall, it becomes clear that the US must go overseas for its NG needs. Now it is time to look at Liquefied Natural Gas (LNG) and determine if LNG imports can make up the difference between US NG demand and diminishing US NG production.
Current Situation
US LNG imports are growing. They have doubled in the last year alone. At present, LNG only accounts for 2% of our natural gas consumption.4 Current US consumption exceeds 80 trillion cubic feet (Tcf). In 2003 we imported 540 billion cubic feet (Bcf) of LNG, just a drop in the bucket compared to our total NG consumption. By the end of this year (2004), the US is hoping to add another 1 Bcf/day of LNG imports, and another 2 Bcf/day by the end of 2006.
The US is currently lacking in LNG infrastructure. There are currently only 4 LNG offloading facilities in the country, located in Georgia, Louisiana, Maryland and Massachusetts . There has been a flood of new proposals for receiving and regasification terminals, but it will be several years before (if) they are all built, and it is likely that a significant portion of the projects will fail somewhere along the way due to local opposition. US demand is expected to grow about 10 Bcf/day to a total of 77 Bcf/day through the course of this decade.5
The world's largest importers of LNG are, in descending order, Japan, Korea, Spain and Taiwan, with the US holding fifth place.6 China is expected to shoulder its way to the top of this list in the next few years. Top suppliers of LNG are, at present, Egypt, Algeria, Norway, Trinidad and Nigeria. Indonesia and Australia are of growing importance as suppliers, as is Russia. And the Middle East holds a great deal of natural gas along with all of its oil. Venezuela hopes to become an LNG producer as well, though the US government is at odds with Venezuelan President Hugo Chavez and the state owned oil company, Petroleos de Venezuela S. A. (PdVSA ).
At the turn of the century, there were only 114 LNG tankers in the world, and only 8 of those were available for spot market trade.7 Today, the current global fleet of LNG tankers numbers 140, with a capacity of 14.5 Bcf/day,8 but it is doubtful that there has been much change in the percentage of tankers which are not locked into long term trade agreements. One credible researcher has put the cost of an LNG tanker at around $150 million and estimated that more than a hundred would be needed to meet US needs. Construction of one LNG tanker takes three years.9
“By the year 2010, the gap between what is needed
and conventional sources
will be 6 Tcf/year, or 16 Bcf/day.”
Meeting Future Demand
In a December 17th speech delivered at a summit of energy ministers from producing countries and private sector representatives, US Energy Czar Spencer Abraham stated that from 2000 to 2020, NG consumption is projected to double, from 84 Trillion cubic feet per year (Tcf/year) to 162 TCF/year. He noted that demand for natural gas is growing by nearly 5.5 % per year.10 By reporting world demand only, Secretary Abraham skirted around the North American NG situation and the entire reason for his speech. In the US, demand is expected to grow rapidly over the next few years while production declines. By the year 2010, the gap between what is needed and conventional sources will be 6 Tcf/year, or 16 Bcf/day. It will require 30 to 40 new LNG offloading and regasification facilities by 2010 to fill this gap.11 According to a report from analysts at Raymond James, the current tanker fleet will have to double within the next five years.12
That means the US will require a fleet equal to the current world fleet, 114 tankers just to service our needs. LNG tankers are three times as expensive as a large crude oil carrier, averaging $155 million per ship.13 So the tanker fleet alone will require an investment of $13 billion and take decades. Add to this the expense of building over 30 new LNG projects and the associated pipelines, and the necessary investment quickly climbs over $100 billion.
Shell, Exxon, BP and Sempra Energy are among the corporations proposing new LNG facilities. New LNG Terminals have been proposed for the states of California, Texas, Alabama and Florida.14 The proposed terminals have many hurdles to jump before they will become reality. First the proposed terminals have to meet all the standards and rules of the U.S. Federal Energy Regulatory Agency, a sprawling and formidable bureaucracy. And they must overcome siting challenges from residents and environmental groups. It is likely that many of the proposed terminals will have to be moved to unobjectionable locations either off the coast or in neighboring countries (as in the case of the terminal proposed for Baja, California which will provide NG to that state).
Throughout the siting and application process, as well as during construction, companies must make considerable capital outlays, providing the necessary ongoing financing for several years before there is any hope of seeing a return on their investment. The NG market fluctuates a great deal with the seasons, causing prices to rise and drop. For these LNG projects to proceed, gas prices must stay well above $4 per thousand cubic feet. Prices are currently far above that mark, but will they stay that high consistently for the next several years?
LNG Supply – IS THERE ENOUGH?
Supposing that 30 new terminals are built, along with a fleet of 114 tankers just to meet US demand, where will we purchase the LNG to be transported and processed by this new infrastructure? Where will we obtain the 16 Bcf/day of LNG to fill the gap between domestic supply and demand by 2010? LNG exporting countries would have to make major investments in additional production in order to meet growing US demand. The LNG market is bound up in long term agreements, just as most of the tankers being built today are already locked into long term contracts.
LNG trade is supposed to increase by 35% from 2000 to 2005, yet all of that increased production is already spoken for by Asia. Even if that entire increase were shipping to the US, it wouldn't come close to meeting US demand. The struggle for LNG market share will bring the US into direct competition with China. In fact, it already has.
Last October, after negotiations which included visits from President Bush and Chinese President Hu Jintao, Australia awarded a new $30 billion, 25 year LNG contract to China. This on top of a $25 billion LNG deal struck a year ago between Australia and China.15 The US, with its weak dollar and anemic economy, must compete with a yuan backed by gold, and a growing economy which is powerful simply because of its size.
The LNG market is very tight, with little spare capacity. The high cost of LNG liquefaction and transport prevents the industry from developing capacity beyond what is contracted. And so, in order to expand imports, the US must either urge LNG exporters to increase production, develop new production elsewhere, or take LNG which was formerly promised elsewhere.
The US is working on a project with Russia to bring a 2 year supply of LNG from Russia's Far East to California . But most of Russia's production is already promised to Europe and Asia.
We've got Our LNG Sites Trained on You
Look for the US to help build an LNG industry in Africa , particularly Nigeria. The west coast of Africa would be much more attractive to the US than would Middle Eastern sources because the shipping route is shorter and more direct. Around 124 Tcf of natural gas have been discovered in Nigeria, making it the 9 th largest reserve in the world.16 Currently, however, Nigeria flares off 75% of its natural gas due to lack of local market and infrastructure. Nigeria alone is said to account for 12.5% of the world's gas flare.17 Nigeria is supposed to put an official end to the practice of gas flaring this year (2004), but the deadline has already been moved back once.
Nigerian production is controlled by NNCP (a state oil firm), working mostly with Shell, TotalFinaElf and Agip. Current Nigerian processing capacity is 383 Bcf/year, much of that being shipped to Europe. By 2005, new projects should increase that capacity by an additional 363.5 Bcf/year.18 Bitter civil unrest has closed down production in Nigeria several times in the past year. Given the growing importance of a stable supply of LNG imports to the US, it would not be surprising to see the US take an interest in pacifying the Nigerian population. US military presence in the region has been increasing with the gift of six US warships to the Nigerian Navy,19 while NATO has announced an increased focus on West Africa.20
CORRUPTION AS USUAL
Right now, in fact, the Nigerian LNG industry is the source of a scandal involving Halliburton's conduct during the period of Dick Cheney's presidency of that company. It seems Halliburton subsidiary Kellogg, Brown & Root is accused of paying Nigerian government officials $180 million in bribes for construction contracts to LNG projects. Investigations are ongoing in Nigeria and France, and the US Justice Department has begun to probe into the allegations. It is possible that embezzlement charges could be filed against Cheney in Paris.21
Currently Trinidad and Tobago in the Caribbean are the largest suppliers of LNG to the US. This area of the Caribbean, off the coast of Venezuela, holds about 30 Tcf of NG reserves. Production has doubled over the past 10 years, to 520 Thousand cubic feet per year (Gcf/year). There are plans to increase production to 1.3 Tcf/year, but this will take time.22 Alot of ammonia and other chemical production has moved to Trinidad, which exports these products back to the US. And so diverting too much of their NG production into LNG will harm the chemical industry there.
Geologically speaking, Trinidad lies on a northern extension of the fossil fuel rich East Venezuelan basin. The islands lie within close proximity to Venezuela and have been associated with that country since explorers used the islands as a base from which to venture into the continent. It seems that whenever you focus upon the islands, you must ultimately turn your attention to the mainland.
Venezuela has 148 Tcf of proven reserves. Currently 60% of its NG production is either re-injected or flared off.23 The Venezuelan state oil company, PdVSA, wants to develop LNG production for export to the US. However, the current regime in the US is vehemently opposed to Venezuelan President Chavez. President Chavez has asked for more royalties from fossil fuel sales so that he can use the money to fight the chronic poverty of Venezuela. The oil majors are averse to sharing more of the oil profits.
There has been one overt coup attempt and at least two more subtle attempts to depose the Chavez government. So far President Chavez and the people of Venezuela have maneuvered around each threat with alacrity. It is very plain that the CIA is aiding these destabilization efforts and that the effort has the full approval of the White House. A nd it is certain that LNG concerns are now adding to the US desire to topple Chavez.
More such efforts can be expected, possibly as soon as this spring. Venezuela, according to US political thinking, is simply too close and too important for the US to leave it in the hands of Chavez—or the hands of the Venezuelan people, for that matter.
The Outlook
Significant LNG production will not begin to come online before 2007 at the earliest. Until then, we hope for mild winters and rely on our own declining NG production. But the big question is: will enough LNG production be available by 2010 to fill the projected gap between North American demand and North American production? It is doubtful that production will grow enough to meet the demands of both the US and China, much less the rest of the world.
As witnessed by the summit at which US Energy Secretary Spence A braham spoke, the US is trying to organize global LNG trade under its watchful eye. However, the magnitude of Chinese demand will speak with its own voice and producing countries will have to listen. It is doubtful that LNG capacity will be able to meet US demand by 2010, much less global demand. Somebody will have to go lacking.
Mild weather in North America over the next few years might be a blessing in the short term for NG supply and prices. But if prices relax below $4/Gcf for any length of time, many of these LNG projects would be put on hold or canceled altogether. So the best case scenario for the short term will make things worse in the long run.
PART II -- Oil Shortages After 2007
It appears that the year 2007 will be important for oil as well as natural gas. A new study published in Petroleum Review suggests that production might not be able to keep up with demand by 2007.24 The study is a survey of mega projects (those with reserves of over 500 million barrels (Mb)) and the potential to produce over 100,000 barrels per day (Gbpd) of oil). Mega projects are important not only because they provide the bulk of world oil production, but also because they have a better net energy profile than smaller projects, and they provide a more substantial profit than smaller projects. Bear in mind that the planet consumes a billion barrels of oil (or two mega fields) every eleven and one half days.
The discovery rate for mega projects has dwindled to almost nothing. This can be seen in the data for the last few years. In 2000, there were 16 discoveries of over 500 Mb; in 2001 there were only 8 new discoveries, and in 2002 there were only 3 such discoveries.25 From first discovery to first production generally takes about 6 years. If the new project can make use of existing infrastructure, then the start up time might be cut to 4 years.
This past year (2003), 7 new mega projects were brought on stream. 2004 expects to see another 11 projects start producing. 2005 will be the peak year for bringing new projects on stream, with 18 new projects expected to be brought on stream in that year. In 2006, the pace drops back to 11 new projects. But in 2007 there are only 3 new projects scheduled to begin production, followed by 3 more in 2008. There are no new projects on track for 2009 or 2010.26 And any new mega project sanctioned now could not possibly come on stream any sooner than 2008.
The study points out that currently about a third of the world's oil production comes from declining fields, with a likely overall decline rate of about 4%. As a result, global production capacity is contracting by over 1 million barrels per day (Mbpd) each year.27 New production is the only thing offsetting this decline.
By 2007, production capacity will have declined by 3-4mn b/d. Yet this decline will be offset by 8mn b/d of new capacity drawn from the many new projects expected to come on stream over the next few years.28 This leaves a surplus of 4mn b/d in spare capacity. Yet global demand is growing by over 1 Mbpd each year.29 So 3 years of demand growth will reduce our spare capacity to 1mn b/d by the start of 2007. As very little new capacity is set to come on stream in 2007, that remaining 1 Mbpd spare capacity will likely disappear before 2008.
The upshot of all this is that the oil supply appears robust until 2007. With so much new production coming on stream, there may even be periods of price weakness. However, it is likely that we will begin suffering oil shortages after 2007, especially if anything happens to disrupt a portion of the production. If new projects are not sanctioned to start up by 2008, then by the end of that year we are likely to see shortages without any cause other than rising demand.
FINDING 10 NEW NORTH SEA FIELDS… SOMEWHERE
By 2015, global oil demand is expected to increase by over two-thirds, that is 60 Mbpd beyond current global consumption of 75 Mbpd. To meet that demand we will have to find the equivalent of 10 new North Sea oil fields within a decade.30 Yet we are hard pressed to discover even another mega-sized field, let alone one reserve equaling the size of the North Sea deposits which are now in serious decline.
We cannot go on ignoring these problems for much longer. By 2007, all of us will be affected by the North American NG shortage. And not very long after 2007, we will begin experiencing the first global energy shortages. To quote former British environmental minister Michael Meacher, we are facing… "the sharpest and perhaps the most violent dislocation (of society) in recent history."31
- LNG to the Rescue?
Gas Shortages Are Most Pressing, But Economics Shows No Easy Answers
Why The Oil Markets May See Price Dips Before The Collapse and Why This Will Make the Outcomes Worse
by
Dale Allen Pfeiffer -- FTW Energy Editor
© Copyright 2004, From The Wilderness Publications, www.fromthewilderness.com. All Rights Reserved. May be reprinted, distributed or posted on an Internet web site for non-profit purposes only.
[Suddenly, Peak Oil and Gas issues are everywhere. It's as if the light bulb is going on a day late and a tank or two short. ABC News, The Petroleum Review, BBC, Wall Street and many other “establishment” voices are beginning to sound the alarm. For North A merica, natural gas shortages are here now and can only worsen. The oil production numbers are bearing out that by 2007 demand will have permanently exceeded supply and production capacity. In both cases the outlook is not good. For natural gas the only solution is the importation of liquefied natural gas or LNG. The costs, dangers, political opposition and international competition for dwindling supplies create a complex calculus that will be exceptionally difficult to solve.
The picture for oil is worsened by the way the oil markets operate. Oil prices are driven only by very short-term criteria, essentially how much oil is in the pipeline for the next few months. The last so-called mega fields – really only a few months supply in the global picture -- are scheduled to come on line in 2005 creating a short term glut even as the industry acknowledges that the cheap oil is gone forever. The result will be that the capital needed to build infrastructure or switch to alternatives will not be available as the last crucial window of opportunity for its use begins to close. Without that timely capital, there will be no brakes when petroleum civilization hits the wall.
Dale Allen Pfeiffer deconstructs the market forces as mankind stands on the brink of a new dark age. – MCR]
______
February 19, 2004, 1800 PST (FTW ) -- In previous articles, we drew a picture of North American natural gas (NG) poised to fall off the cliff of declining production. In order to maintain a healthy economy, our natural gas consumption – primarily for the generation of electricity – must grow by 35 to 50% before the end of the decade. The North American NG supply is in decline and has already fallen behind demand. Homes must have heat in the winter. In the US, 60% of all homes are heated by NG, and that ratio is increasing, as over 70% of new homes require NG for heating.1 Natural gas is the intended fuel of virtually all new power generation projects within the US. By 2002, 90% of all new power plants were gas-fired.2 All of the industrial users with the ability to move production or shift to other fuel sources have done so. There is little room left for fuel switching. How then to make up the shortfall?
Opening up pipelines from Alaska (ANWR) and Northern Canada will take several years and will not make up for the deficit between traditional production and demand. It is more than likely that any production carried along a Canadian pipeline would be diverted to Canadian tar sands refining, which involves the use of high-pressure steam (heated by gas) to wash heavy oil from sand. Opening sanctioned areas of the Rockies and the Outer Continental Shelf would help, though NG reserves in both areas are likely to deplete quickly. Geologist Walter Youngquist and electrical engineer Richard Duncan pointed out in a recent study that new NG wells are showing decline rates as high as 80% in the first year. Over the past decade, the amount of gas found per foot drilled has declined by 50%.3
In examining the situation and looking over the optional sources of NG to make up the shortfall, it becomes clear that the US must go overseas for its NG needs. Now it is time to look at Liquefied Natural Gas (LNG) and determine if LNG imports can make up the difference between US NG demand and diminishing US NG production.
Current Situation
US LNG imports are growing. They have doubled in the last year alone. At present, LNG only accounts for 2% of our natural gas consumption.4 Current US consumption exceeds 80 trillion cubic feet (Tcf). In 2003 we imported 540 billion cubic feet (Bcf) of LNG, just a drop in the bucket compared to our total NG consumption. By the end of this year (2004), the US is hoping to add another 1 Bcf/day of LNG imports, and another 2 Bcf/day by the end of 2006.
The US is currently lacking in LNG infrastructure. There are currently only 4 LNG offloading facilities in the country, located in Georgia, Louisiana, Maryland and Massachusetts . There has been a flood of new proposals for receiving and regasification terminals, but it will be several years before (if) they are all built, and it is likely that a significant portion of the projects will fail somewhere along the way due to local opposition. US demand is expected to grow about 10 Bcf/day to a total of 77 Bcf/day through the course of this decade.5
The world's largest importers of LNG are, in descending order, Japan, Korea, Spain and Taiwan, with the US holding fifth place.6 China is expected to shoulder its way to the top of this list in the next few years. Top suppliers of LNG are, at present, Egypt, Algeria, Norway, Trinidad and Nigeria. Indonesia and Australia are of growing importance as suppliers, as is Russia. And the Middle East holds a great deal of natural gas along with all of its oil. Venezuela hopes to become an LNG producer as well, though the US government is at odds with Venezuelan President Hugo Chavez and the state owned oil company, Petroleos de Venezuela S. A. (PdVSA ).
At the turn of the century, there were only 114 LNG tankers in the world, and only 8 of those were available for spot market trade.7 Today, the current global fleet of LNG tankers numbers 140, with a capacity of 14.5 Bcf/day,8 but it is doubtful that there has been much change in the percentage of tankers which are not locked into long term trade agreements. One credible researcher has put the cost of an LNG tanker at around $150 million and estimated that more than a hundred would be needed to meet US needs. Construction of one LNG tanker takes three years.9
“By the year 2010, the gap between what is needed
and conventional sources
will be 6 Tcf/year, or 16 Bcf/day.”
Meeting Future Demand
In a December 17th speech delivered at a summit of energy ministers from producing countries and private sector representatives, US Energy Czar Spencer Abraham stated that from 2000 to 2020, NG consumption is projected to double, from 84 Trillion cubic feet per year (Tcf/year) to 162 TCF/year. He noted that demand for natural gas is growing by nearly 5.5 % per year.10 By reporting world demand only, Secretary Abraham skirted around the North American NG situation and the entire reason for his speech. In the US, demand is expected to grow rapidly over the next few years while production declines. By the year 2010, the gap between what is needed and conventional sources will be 6 Tcf/year, or 16 Bcf/day. It will require 30 to 40 new LNG offloading and regasification facilities by 2010 to fill this gap.11 According to a report from analysts at Raymond James, the current tanker fleet will have to double within the next five years.12
That means the US will require a fleet equal to the current world fleet, 114 tankers just to service our needs. LNG tankers are three times as expensive as a large crude oil carrier, averaging $155 million per ship.13 So the tanker fleet alone will require an investment of $13 billion and take decades. Add to this the expense of building over 30 new LNG projects and the associated pipelines, and the necessary investment quickly climbs over $100 billion.
Shell, Exxon, BP and Sempra Energy are among the corporations proposing new LNG facilities. New LNG Terminals have been proposed for the states of California, Texas, Alabama and Florida.14 The proposed terminals have many hurdles to jump before they will become reality. First the proposed terminals have to meet all the standards and rules of the U.S. Federal Energy Regulatory Agency, a sprawling and formidable bureaucracy. And they must overcome siting challenges from residents and environmental groups. It is likely that many of the proposed terminals will have to be moved to unobjectionable locations either off the coast or in neighboring countries (as in the case of the terminal proposed for Baja, California which will provide NG to that state).
Throughout the siting and application process, as well as during construction, companies must make considerable capital outlays, providing the necessary ongoing financing for several years before there is any hope of seeing a return on their investment. The NG market fluctuates a great deal with the seasons, causing prices to rise and drop. For these LNG projects to proceed, gas prices must stay well above $4 per thousand cubic feet. Prices are currently far above that mark, but will they stay that high consistently for the next several years?
LNG Supply – IS THERE ENOUGH?
Supposing that 30 new terminals are built, along with a fleet of 114 tankers just to meet US demand, where will we purchase the LNG to be transported and processed by this new infrastructure? Where will we obtain the 16 Bcf/day of LNG to fill the gap between domestic supply and demand by 2010? LNG exporting countries would have to make major investments in additional production in order to meet growing US demand. The LNG market is bound up in long term agreements, just as most of the tankers being built today are already locked into long term contracts.
LNG trade is supposed to increase by 35% from 2000 to 2005, yet all of that increased production is already spoken for by Asia. Even if that entire increase were shipping to the US, it wouldn't come close to meeting US demand. The struggle for LNG market share will bring the US into direct competition with China. In fact, it already has.
Last October, after negotiations which included visits from President Bush and Chinese President Hu Jintao, Australia awarded a new $30 billion, 25 year LNG contract to China. This on top of a $25 billion LNG deal struck a year ago between Australia and China.15 The US, with its weak dollar and anemic economy, must compete with a yuan backed by gold, and a growing economy which is powerful simply because of its size.
The LNG market is very tight, with little spare capacity. The high cost of LNG liquefaction and transport prevents the industry from developing capacity beyond what is contracted. And so, in order to expand imports, the US must either urge LNG exporters to increase production, develop new production elsewhere, or take LNG which was formerly promised elsewhere.
The US is working on a project with Russia to bring a 2 year supply of LNG from Russia's Far East to California . But most of Russia's production is already promised to Europe and Asia.
We've got Our LNG Sites Trained on You
Look for the US to help build an LNG industry in Africa , particularly Nigeria. The west coast of Africa would be much more attractive to the US than would Middle Eastern sources because the shipping route is shorter and more direct. Around 124 Tcf of natural gas have been discovered in Nigeria, making it the 9 th largest reserve in the world.16 Currently, however, Nigeria flares off 75% of its natural gas due to lack of local market and infrastructure. Nigeria alone is said to account for 12.5% of the world's gas flare.17 Nigeria is supposed to put an official end to the practice of gas flaring this year (2004), but the deadline has already been moved back once.
Nigerian production is controlled by NNCP (a state oil firm), working mostly with Shell, TotalFinaElf and Agip. Current Nigerian processing capacity is 383 Bcf/year, much of that being shipped to Europe. By 2005, new projects should increase that capacity by an additional 363.5 Bcf/year.18 Bitter civil unrest has closed down production in Nigeria several times in the past year. Given the growing importance of a stable supply of LNG imports to the US, it would not be surprising to see the US take an interest in pacifying the Nigerian population. US military presence in the region has been increasing with the gift of six US warships to the Nigerian Navy,19 while NATO has announced an increased focus on West Africa.20
CORRUPTION AS USUAL
Right now, in fact, the Nigerian LNG industry is the source of a scandal involving Halliburton's conduct during the period of Dick Cheney's presidency of that company. It seems Halliburton subsidiary Kellogg, Brown & Root is accused of paying Nigerian government officials $180 million in bribes for construction contracts to LNG projects. Investigations are ongoing in Nigeria and France, and the US Justice Department has begun to probe into the allegations. It is possible that embezzlement charges could be filed against Cheney in Paris.21
Currently Trinidad and Tobago in the Caribbean are the largest suppliers of LNG to the US. This area of the Caribbean, off the coast of Venezuela, holds about 30 Tcf of NG reserves. Production has doubled over the past 10 years, to 520 Thousand cubic feet per year (Gcf/year). There are plans to increase production to 1.3 Tcf/year, but this will take time.22 Alot of ammonia and other chemical production has moved to Trinidad, which exports these products back to the US. And so diverting too much of their NG production into LNG will harm the chemical industry there.
Geologically speaking, Trinidad lies on a northern extension of the fossil fuel rich East Venezuelan basin. The islands lie within close proximity to Venezuela and have been associated with that country since explorers used the islands as a base from which to venture into the continent. It seems that whenever you focus upon the islands, you must ultimately turn your attention to the mainland.
Venezuela has 148 Tcf of proven reserves. Currently 60% of its NG production is either re-injected or flared off.23 The Venezuelan state oil company, PdVSA, wants to develop LNG production for export to the US. However, the current regime in the US is vehemently opposed to Venezuelan President Chavez. President Chavez has asked for more royalties from fossil fuel sales so that he can use the money to fight the chronic poverty of Venezuela. The oil majors are averse to sharing more of the oil profits.
There has been one overt coup attempt and at least two more subtle attempts to depose the Chavez government. So far President Chavez and the people of Venezuela have maneuvered around each threat with alacrity. It is very plain that the CIA is aiding these destabilization efforts and that the effort has the full approval of the White House. A nd it is certain that LNG concerns are now adding to the US desire to topple Chavez.
More such efforts can be expected, possibly as soon as this spring. Venezuela, according to US political thinking, is simply too close and too important for the US to leave it in the hands of Chavez—or the hands of the Venezuelan people, for that matter.
The Outlook
Significant LNG production will not begin to come online before 2007 at the earliest. Until then, we hope for mild winters and rely on our own declining NG production. But the big question is: will enough LNG production be available by 2010 to fill the projected gap between North American demand and North American production? It is doubtful that production will grow enough to meet the demands of both the US and China, much less the rest of the world.
As witnessed by the summit at which US Energy Secretary Spence A braham spoke, the US is trying to organize global LNG trade under its watchful eye. However, the magnitude of Chinese demand will speak with its own voice and producing countries will have to listen. It is doubtful that LNG capacity will be able to meet US demand by 2010, much less global demand. Somebody will have to go lacking.
Mild weather in North America over the next few years might be a blessing in the short term for NG supply and prices. But if prices relax below $4/Gcf for any length of time, many of these LNG projects would be put on hold or canceled altogether. So the best case scenario for the short term will make things worse in the long run.
PART II -- Oil Shortages After 2007
It appears that the year 2007 will be important for oil as well as natural gas. A new study published in Petroleum Review suggests that production might not be able to keep up with demand by 2007.24 The study is a survey of mega projects (those with reserves of over 500 million barrels (Mb)) and the potential to produce over 100,000 barrels per day (Gbpd) of oil). Mega projects are important not only because they provide the bulk of world oil production, but also because they have a better net energy profile than smaller projects, and they provide a more substantial profit than smaller projects. Bear in mind that the planet consumes a billion barrels of oil (or two mega fields) every eleven and one half days.
The discovery rate for mega projects has dwindled to almost nothing. This can be seen in the data for the last few years. In 2000, there were 16 discoveries of over 500 Mb; in 2001 there were only 8 new discoveries, and in 2002 there were only 3 such discoveries.25 From first discovery to first production generally takes about 6 years. If the new project can make use of existing infrastructure, then the start up time might be cut to 4 years.
This past year (2003), 7 new mega projects were brought on stream. 2004 expects to see another 11 projects start producing. 2005 will be the peak year for bringing new projects on stream, with 18 new projects expected to be brought on stream in that year. In 2006, the pace drops back to 11 new projects. But in 2007 there are only 3 new projects scheduled to begin production, followed by 3 more in 2008. There are no new projects on track for 2009 or 2010.26 And any new mega project sanctioned now could not possibly come on stream any sooner than 2008.
The study points out that currently about a third of the world's oil production comes from declining fields, with a likely overall decline rate of about 4%. As a result, global production capacity is contracting by over 1 million barrels per day (Mbpd) each year.27 New production is the only thing offsetting this decline.
By 2007, production capacity will have declined by 3-4mn b/d. Yet this decline will be offset by 8mn b/d of new capacity drawn from the many new projects expected to come on stream over the next few years.28 This leaves a surplus of 4mn b/d in spare capacity. Yet global demand is growing by over 1 Mbpd each year.29 So 3 years of demand growth will reduce our spare capacity to 1mn b/d by the start of 2007. As very little new capacity is set to come on stream in 2007, that remaining 1 Mbpd spare capacity will likely disappear before 2008.
The upshot of all this is that the oil supply appears robust until 2007. With so much new production coming on stream, there may even be periods of price weakness. However, it is likely that we will begin suffering oil shortages after 2007, especially if anything happens to disrupt a portion of the production. If new projects are not sanctioned to start up by 2008, then by the end of that year we are likely to see shortages without any cause other than rising demand.
FINDING 10 NEW NORTH SEA FIELDS… SOMEWHERE
By 2015, global oil demand is expected to increase by over two-thirds, that is 60 Mbpd beyond current global consumption of 75 Mbpd. To meet that demand we will have to find the equivalent of 10 new North Sea oil fields within a decade.30 Yet we are hard pressed to discover even another mega-sized field, let alone one reserve equaling the size of the North Sea deposits which are now in serious decline.
We cannot go on ignoring these problems for much longer. By 2007, all of us will be affected by the North American NG shortage. And not very long after 2007, we will begin experiencing the first global energy shortages. To quote former British environmental minister Michael Meacher, we are facing… "the sharpest and perhaps the most violent dislocation (of society) in recent history."31
Subscribe to:
Posts (Atom)
