Stabbing the Beast

I spent a while last night reading David Holmgren’s latest essay Crash on Demand (read the PDF here). Back in 2007 Holmgren, who is one of the initiators of the concept of Permaculture, wrote a series of possible future scenarios in which he posited a number of different scenarios that could play out with regard to civilisation and the environment. I won’t go into those scenarios here but suffice to say that this latest essay represents an additional one - and a new way of thinking.

The two civilisation destroying situations we face are peak oil and climate change. Holmgren goes into some detail about why his perception of these has changed, concluding that peak oil has not yet turned out to be as bad as expected (for various reasons, notably financial) and climate change is likely to now far exceed our worst expectations, with a 4-6C degree scenario now likely in a BAU scenario.

This change in thinking was the result of an observation of the way energy and economic issues are panning out, plus a deeper consideration of the role of finance courtesy of systems thinker Nicole Foss. The gist of it is this: we are rapidly losing the chance to persuade policy makers to take the risk of global warming seriously, and given that the course we are now on would likely wipe out nearly all of humanity and make life considerably worse for millions of other species over the coming millennia, then the only sensible option for us is to crash the system of global growth-based capitalism.

If that sounds radical that’s because it is. Holmgren points out that the last few decades of environmental protest have failed miserably. The dominant paradigm of ‘economic growth at any cost’ grinds ecocentrist concerns into the dust. A quick survey of the news headlines should convince anyone of the veracity of this. And although we are now living in an age of limits, where the quantity and quality of the fossil energy sources available to us begins to diminish, the system is perpetuated by the financial system which continues to magic credit out of thin air without any basis on a claim in the real world. Witness the shale oil boom in the US, a vastly inefficient and polluting operation that only makes economic sense due to the distorting wizardry of Wall Street financiers.

Furthermore, he rightly observes that the vast majority of people in the industrialised world could not care less about destroying the basis for life on planet Earth. As the global economic bubble deflates - something it has been doing since 2008 - most people in our overdeveloped economies are too busy trying to hold down a job or are too influenced by the growth-perpetuating mantra of politicians and the media to give much thought to the wider world. This is unfortunate, but at least it demonstrates the pointlessness of trying to gain political traction in a system that is rigged against anything other than limitless growth. Any concessions the system makes to preserving the biosphere tend to be largely symbolic, such as increasing bottle recycling rates, or charging a levy on plastic bags, while the real business of exploitation on a planetary scale continues apace.

Furthermore, the plateauing of oil production has not seen the rapid uptake of clean-tech that its proponents suggested would happen as soon as oil prices climbed. Instead it has seen a switch to dirtier and more dangerous to extract fuels, aided and abetted by the fossil fuel sector and its financial backers. So instead of moving into a ‘green tech’ future we are in practice moving into a ‘brown tech’ one. And although the financial instruments used to boost the production of shale oil and gas are by nature Ponzi schemes and cannot last, Holmgren argues that they may indeed last long enough to make a controlled powerdown situation impossible, as well as missing the window to wean ourselves off fossil fuels.

However, given that the economic system is only being held together by an almost-hallucinatory perception of continued growth and stability which is held by the majority, perhaps this is also the key to seeing its Achilles heel. Holmgren says that a sudden whole scale implosion of the global financial system is really the only hope of curtailing our carbon emissions and cutting them to a level that would avoid runaway global warming. He estimates the chances of a global economic collapse happening ‘naturally’ at 50% over the next five years.

But then he goes on to advocate giving it a good shove in that direction.

An estimated billion people on the planet live middle class lifestyles and use up the lion’s share of energy and resources. Holmgren says that if a section - he reckons 10% - opt out of the growth at any cost paradigm and massively downscale their involvement with the global system of capitalism, then this might be enough to send it into a terminal decline faster than it is already in. This might be easier than it sounds, he says. A majority of people are now disillusioned to some extent with bankers and politicians, and this number can only grow as promises continue to be broken and the wealth gap continues to widen. Actions could be as simple as withdrawing all your money from the bank and storing it as cash - after all, take £100 out of the bank and you are starving the system of £1000 of credit that it would otherwise use as part of the fractional reserve system. He goes on to advocate turning ones back on corporations, shopping locally, growing your own veg and all of the other things that Permaculturists and Transitioners do as a matter of course. This, he insists, is a positive thing to do that offers the only real hope of making a difference.

Adopting local currencies, bartering, avoiding paying tax and using the copious quantities of materials lying around as leftovers from the current waste-based economy would be ways of hastening the demise of the planet-destroying system, while simultaneously acting as a good model for late adopters, many of whom would want to ‘join up’ as the current system of industrial production begins to falter. This, he concedes, would also hasten the demise of a good many worthy and progressive projects, and would likely make enemies with those on the left of the political spectrum who rely just as much on the growth of the industrial system as those on the right. Nevertheless, he says, this is a bitter price that must be paid.

Would this be enough to starve the beast? Nobody knows, but it might represent a better expenditure of energy rather than waving a banner outside a climate conference. The system, he maintains, cannot be reformed. Instead it must die and be reborn. He is quite aware that advocating such a view would vilify him and others who could be accused of trying to collapse the economic system, but maintains that we have a duty to protect life on earth by any means necessary from a rapacious class of human being and a system that has got out of control. This is best done by building an alternative parallel economy - one that is not predicated on endless growth.

By a strange coincidence, after I had finished reading David Holmgren’s essay an email popped up in my browser. It was just telling me that Collette O’Neill - the Irish blogger who lives at Bealtaine Cottage - had a new post. I clicked on it and was greeted by a series of pictures and text that are a living example of everything David Holmgren was advocating. It summarised how she herself had turned away from ‘the machine’ and how this had allowed her to build her permaculture cottage and lead the kind of life that many dream could only be possible by, say, winning the lottery. See her example here.

http://www.futurescenarios.org

http://www.transitionnetwork.org

Our Army of Invisible Helpers

A human power station from the BBC's 'Bang Goes the Theory' where human energy slaves were made to power a single household for 24 hours

When I started this blog almost three years ago it had a different title to the one you see today. Scratching my head for a good name for it I decided to call it the Peak Oil Dispatch. My idea was to provide a kind of online resource for peak oil news and other articles relating to the decline of industrial life and catabolic collapse. After all, I was unemployed back then and had plenty of time on my hands for such a project.

This idea didn't last long. Once gainfully employed again I found I didn't have time for such a project, so I decided to change the name and stick with the traditional blog format. I used the quote from Colin Campbell as a title. There was something about the number 22 that attracted me - I lived in flat number 22 in our block, my phone number started with '22' and so did our car registration - and there is irony in the Catch-22 situation our industrial societies find themselves stuck in in that we have to burn more oil to keep growing the economy which will eventually consume all the oil and destabilise the climate.

Colin Campbell, when giving a talk to the Association for the Study of Peak Oil (ASPO) had said that every day oil provides humanity with the equivalent energy of 22 billion human slaves - or 'energy slaves'. These slaves do our bidding silently and are unnoticed by the masses, and the way he arrived at the figure, I am told, is by taking the total amount of conventional oil produced each day and dividing it up into 'drops'. Each drop of oil represents the work of one human in one day, and there are around 22 billion drops of oil produced each day.

Alexandre de Robaulx de Beaurieux, a geologist and board member of ASPO Germany, provided me with the following quote from Colin Campbell from the 2013 edition of Campbell's Oil and Gas Depletion:

"It was as if oil provided us with an army of unpaid and unfed slaves to do our work for us. It has been calculated that a drop of oil, weighing one gram, yields 10,000 calories of energy, which is the equivalent of one day’s hard human labour. In other words, today’s oil production is equivalent in energy terms to the work of 22 billion slaves. Financial control of the world has led to a certain polarisation between the wealthy West and the other countries which find themselves burdened by foreign debt as they export resources, product and profit. Many people have come to think that it is money that makes the world go round, when in reality it is the underlying supply of cheap, and largely oil-based, energy, that has turned the wheels of industry, fuelled the airliners and the bombers, and generally acted as the world’s blood stream. Midas-like wealth flowed to those who find themselves having a controlling position in the System."

The energy slaves in question were assumed to be involved in work that was the equivalent of lifting a ton of sand 2m into the air. This was all very well but I couldn't help thinking that the number of energy slaves seemed a bit on the low side. After all, if driving an average 120 horse power car down a motorway were to be done with the power of human slaves alone, you would need upwards of 500 human beings to pull you along (assuming they could run that fast!). And with around a billion cars in the world at present, plus millions of trucks, aircraft, ships, trains etc. the figure of 22 billion would seem very low indeed - and that's not even taking account of all the other uses for fossil fuels that we have, from heating to electricity generation and so on.

So it struck me that we should consider all fossil energy sources when trying to arrive at some figure of how much assistance we are getting from hydrocarbons. Given that I'm no Einstein when it comes to mathematics I asked for help in arriving at this figure, promising the one who could come up with the best answer a box of Cornish fudge. What I wanted to know was the answer to the following question:

If all the energy we currently derive from fossil fuels alone (i.e. not including nuclear or renewables) was suddenly unavailable, and we had at our disposal a few handy nearby planets populated with well-fed healthy adult human males that we could capture as our 'energy slaves', how many of them would we need to allow us to enjoy the same lifestyle currently being provided by fossil fuels?

Of course, this being an entirely imaginary exercise, we would have to overlook the fact that the slaves would need to be fed, and furthermore we would have to assume that they produced energy close to the point where it was needed (e.g. a coal power station would be replaced by serried ranks of energy slaves on exercise bikes fitted with power-generating dynamos). A further assumption is that a slave would only be able to work for 12 hours at a stretch.

Of the responses I received three stood out - and they all come to somewhat similar conclusions despite using different methods. 

Daniel Hägerby from Sweden, taking his data from the 2013 BP Statistical Review, concluded the following about how many slaves we would need per capita:

"Total amount of primary fossil energy consumed was 10848 Mtoe in 2012. Multiply by 42*10^6 to get the number of kilojules. Then divide by 3600 to get kWh (which I find easiest to think in terms of). Then divide by population, I used seven billion. That gets you a total of about 18 000 kWh per capita per year. 

Then we assume that each slave works 12 hour per day 7 days per week. We can also assume that each slave can yield 50 watts of productive power. With a human power efficiency of 20% that means each slave would consume 50/0,2*12*365 = 1095 kWh per year. 

Divide the two and you get about 17 fossil energy slaves per capita. I think ignoring the efficiency of human power conversion is cheating - because engines and power plant also have big thermal losses. So, if our slaves could eat fossil fuels and have no energy expenditure to survive (only to work for us) - we would need 17 slaves per capita, working 12 hour per day all year round. 

Then we can of course study the UK separately. That would give us around 30 fossil energy slaves, using the same method."

So that means that with around 17 energy slaves per unit of population, we would need a total of 119 billion energy slaves to keep things ticking over as they do today.

Also from Sweden, Gunnar Rundgren, who writes the blog gardenearth.blogspot.se, pointed out that he had already made such a calculation for his book Garden Earth. He relates the following:

"We can contrast the energy content in human beings with the external energy sources conquered, to give us an idea of the importance of the development of external energy sources. Let us do a back-of-the-envelope calculation.  A human being needs around 2500 calories per day (2.9 kWh ). We use around 80% of that just to stay awake, think, eat, sleep, breathe, etc. So a bit less than 600 Wh is perhaps left for work. Hard-working people could perhaps use 800 Wh, but they will also eat more. On a yearly basis, the average person consumes around a million calories, which corresponds to 1.16 MWh. 

The average American uses 7.71 tons of oil equivalents (toes) of energy (the average British 3.8, the Swede 5.65 and the Senegalese 0.25), which corresponds to 90 MWh, that is, the energy in the annual food consumption for 77 persons, or if we calculate on the basis of the 20% that we actually use for work it would correspond to roughly 380 persons. On the other hand, energy losses also occur for the conversion of external energy to useful work. If we assume that this is 40%, we arrive at a figure of 150 persons.

So, depending on how we count, each American has somewhere between 75 and 400 ‘energy slaves’ working for him or her, and the richer ones have thousands. The global average energy use is of course lower, and represents figures between 18 and 90, which translated to the total population would mean somewhere between 120 and 600 billion energy slaves. From this perspective, it is certainly no surprise that human beings have taken over the planet!

Another way of looking at it, from an economic perspective, is that a barrel of oil represents the energy of 25,000 hours of human toil, that is, 14 persons working round the year with normal Western labour standards. The cost for pumping the oil is not more than a few dollars per barrel, and even with an oil price of many hundred dollars per barrel, it is very cheap compared to human slave labour. The beauty of the oil slaves is that they don’t have to be feed at all. The slaves of the past, even under huge oppression and extortion, used a lot of the food themselves just to survive. From this perspective, our current wealth can be easily understood and demystified. Even hundreds of years ago, long before industrial society and capitalism, the person who had hundreds of others working solely for him or her could lead a comfortable life.

Any comments? I guess a difference is if you calculate in-energy or output energy for both fossil and human labour?"

As Gunnar points out, the calculation is necessarily a very rough one due to the nature of the underlying assumptions. There is no real way to substitute human labour for coal or oil, but his shot at estimating the true number of energy slaves is illuminating.

Finally, Alex from ASPO Germany, who is mentioned above, provided his own calculations, and brings EROEI and the energy subsidy provided by past slaves (i.e. what quality of oil is Colin Campbell assuming in his calculation?) into the conversation. Alex's way of looking at it uses a different way of arriving at a figure, but the conclusion he reaches is somewhat similar to the first two:

"  [T]he party with unconventionals is suddenly over as soon as you stop drilling more and more only in order to stand still [Red Queen effect]. So what we have is the good stuff with EROI-ratios over let's say 30:1 already gone. Now what the Americans do is trying to substitute conventinal oil with low EROI-sources below 10:1 à la tight oil or tar sands at home ...  So, just to project it over my thumb, I would say that if Dr. Campbell used let's say a ratio of 30:1 for his calculation and if you try to keep the same work done using the "sweet spots" of unconventional sources aka with a net energy surplus 5 times smaller, you are at ca. 100 billion energy slaves. I think this calculation should be done on a per-country-basis to get a better picture, but it will still be only about oil.

Now if you compensate some losses in conventional AND unconventional production [think of the decline-rates an order of magnitude higher than in conventional fields] by trying to incorporate "renewables" that are not renewable, not new and require oil from A to Z, I think you will need additional hundreds of billions of slaves. But this would depend on your conventional/unconventinal-ratio and also on the type of substitutes used. On the other hand, "renewables" are no substitutes for liquid fuels anyway [except local methanol on a small scale perhaps], and I remember a blog-post by Dr. Tom Murphy about algae fuel, comparing its EROI with that from old newspapers being fished out of a pond, dried and burned.

So let's take "renewables" again out of the equation and only keep liquid fuels from conventional and unconventional sources. If the minimum EROI required to fuel the most simple tasks in society is 3:1 [and I'm not talking about the military-industrial complex here with drones], and we had a ratio of 30:1 for our 22 billion slaves, this gives us a theoretical 220 billion "unconventional" slaves. All else being equal, if we consider that much over 90% of all transportation in the EU27 was based upon oil in 2006 ... and will still be at about 90% for a certain time to come, I think 200 billion pure "unconventional" slaves would be the maximum upper limit."


So although Colin Campbell's figure of 22 billion energy slaves looks safe when you consider decent EROEI conventional oil only, taking into consideration all of the other forms of fossilised life that we are currently extracting as fast as we can, we get much higher figures. Just to recap, these are the likely figures:

Daniel - 119 billion energy slaves
Gunnar - 120 - 600 billion energy slaves (average 360 BES)
Alex - 200 billion energy slaves

Taking an average of the above three results would give us a theoretical figure of 226 billion energy slaves.

What would 226 billion energy slaves look like? Humans occupy around only 2% of the surface of the planet, so assuming our energy slaves are distributed close to us rather than arrayed in horizon-filling ranks in the Gobi Desert or Antarctica, we can expect an energy slave population density as follows:

196,939,900 square miles - surface area of planet Earth
3,938,798 square miles - surface area of human populated areas
226,000,000,000 - number of fossil energy slaves in total (not including 'nuclear slaves' or 'eco slaves')
53,378 fossil slaves per square mile 

That's an awful lot of invisible men running around in your neighbourhood! The only question remaining for me now is whether I should change the title of this blog ...

PS. Tak to Daniel and Gunnar and danke to Alex - you'll all be getting some Cornish fudge in the post.

How Many Energy Slaves?

Sometimes life is a bit of a blur. I have good intentions to write a blog post a week but what with moving house, working on my woodland, doing freelance work and having kids I have been struggling of late. Anyone who has been following the electronic scribblings on these pages for the last three years or so might have noticed that I started off unfocused, writing mainly about random stuff, went through a period of writing focused relevant articles that even got aggregated by other sites, and have now come full circle and started writing randomly again. 

Apologies! My only excuse is that, in the great scheme of things, writing a blog for free comes fairly low down in the pecking order all things considered, when other things jostle their way to the front of the queue. Nevertheless, now that the heat of summer has dissipated and the cool September sea mists have begun to roll in off the Atlantic it is perhaps easier to be more reflective and calm again, which is the state of mind needed to effect any kind of lucid communication in this day and age.

That said, this week’s post is more of a news roundup than a fully rounded piece. You know how it is, you get an idea and think I must write  something about that, but before you do something new turns up and you add it to the mental pile. Before you know it, you’ve got a kebab skewer of ideas for a blog post and no idea which piece you should bite into first. So, without further ado, I’l dish out the chunks of fried meat, one morsel at a time.

***

Most people, when they move to Cornwall and drop out of mainstream society become impressionist artists, soapmakers, carpenters or, ahem, woodlanders. Not so Chris Abbot, whom I have come to know via the local Transition Penwith group. No, instead of setting up a little shop selling curios to tourists, or carving mushrooms out of logs, Chris decided to set up his own intelligence agency. 

He says it is the ‘world’s first civil society intelligence agency’ and it’s run from a small building down here at the tip of England. Okay, so Open Briefing hasn’t exactly got the CIA isn’t quaking in its boots just yet, but with several analysts with backgrounds in intelligence on the staff rostrum, it’s not a bad source of unbiased information about how our civil liberties are being systematically stripped away. Did I say unbiased? Well, of course it isn’t - it’s biased towards ordinary folk, rather than the military industrial complex.

I saw Chris last week when he popped around to pick up some citrus trees I had brought back from Spain. He looked tired and said he had been working hard on new report about drones. That report, entitled Remote Control War: Unmanned combat air vehicles in China, India, Iran, Israel, Russia and Turkey has now been released. 

Read it here (or a summary here) but don’t expect it to put you in a good mood. 

***

Yesterday saw the release of the IPCC’s report on climate change. There were not any real surprises in there, and if anything it has been toned down substantially so as not to rock the boat too much. I gave up hope in governments doing anything to tackle AGW several years ago when I was at the Copenhagen COP15 Climate Conference. It is now starkly clear that we either leave most of the fossil fuels in the ground, or we sign the death warrant of most human civilisations. 

The message seems to be getting through in some quarters, with most UK newspapers reporting on it as their main item. My jaw hit the floor however when I read the Daily Telegraph - the go-to newspaper for aggressive climate science denialists - write an article with the following:

It is surely past time, therefore, to take matters out of the hands of the zealots – on both sides. No one can deny that mankind is pumping carbon dioxide into the atmosphere at unprecedented rates, or that this will inevitably have a warming effect on the climate (the reason for the current “pause”, scientists believe, is that the heat has been stored up in the deep oceans, as part of a natural cycle).

Did my eyes deceive me? Had I actually just read that? An anguished howl immediately went up from the rabid, frothing at the mouth climate science deniers in the comments section. 

Today, however, there is no mention of the IPCC report on The Telegraph. Perhaps the editors got a call from the tax-avoiding, big oil protecting, independent media bashing, liberal hating Barclay brothers ... who happen to own The Telegraph.

***

Still on the climate, the report states clearly that we are on course for a +5C warming by the end of the century on a business as usual (BUA) basis. BAU, in my opinion, won’t happen due to resource constraints, but assuming we can continue to plunder every gram of carbon based fuel from the Earth’s crust we will. 

Who’s to blame? All of us, of course. Some more than others. In fact, some a lot more than others. But blame isn’t a particularly useful response. To that end I’ve decided to plant 500 trees a year and have already started. This is happening on my land at Fox Wood, with 500 acorns due to be popped into soil-filled bags in a couple of weeks. I’ll be writing more about it on that blog in due course.

***

In other developments, I have long been threatening to write a book. That threat is now starting to be put into effect. I don’t know how long it will take me but I already have an idea, chapter by chapter, how it will pan out. In writing a book about the end of our industrial society one faces several challenging questions, such as:

Who is it for?

To what level of depth do I go into?

To what extent should it be empirical and full of references to statistics?

Should it be ‘a good read’ (i.e. with splashes of humour) or should it be po-faced?

Should it be self-published or should I seek a publisher?

I have managed to answer a few of those questions myself. The book, primarily, will be aimed at people in over-developed countries, and there will be a particular focus on Britain. After all, that’s where I live and am from. Why are most peak oil authors American? It is just not on the radar over here. I have some theories as to why that is so.

The book will be a primer. I don’t intend to go into much depth about the metaphysical underpinnings of our crises, although can’t entirely avoid that. I won’t be proposing any geo-engineering solutions, perpetual energy devices or happy endings (other than at the individual level). I can promise that it will have a dose of humour, however, as I don’t seem to be able to write the kind of dry fact-dense prose which features in most other books dealing with similar subjects. 

This doesn’t mean I won’t be having a crack at the following:

• Highlighting Cartesian/Baconian thinking as the departure point from which humanity began to get too big for its boots
• Drowning the civil religion of progress in a bucket of cold water
• Caricaturing the techno utopian fantasists as dangerous imbeciles
• Standing up the the ‘bloke in the pub’ talk about nuclear fast breeder reactors and the like
• Demolishing the myth of free market economics

On a more positive note, I’ll be focusing on what people, either as individuals, families or small communities, can do to prepare themselves for the future that is already upon us. The tentative title is When the Lights go Out: Surviving in the Age of Broken Promises.

***

Writing a blog about the abstract concept of the end of the age of abundance probably has its advantages, although I can’t think of any off the top of my head. Last week, however, was a bit different when 22 Billion Energy Slaves reader and doomstead diner Harry Lerwill turned up in my local tavern the Dolphin Inn. Harry had come over from California with his other half Barbara and found himself in the neighbourhood hunting for ghosts (the Dolphin has three). It was good to sink a couple of pints of Cornish ale and chat about economic collapse. Anyone else in the area feel free to drop me a line.

***

And finally ... how many energy slaves?

The title of this blog was gleaned from a comment made by petroleum geologist Colin Campbell. It refers to the number of human slaves equivalents we would need, working 24/7, to supply the same amount of energy that we currently get from easy oil. 

One or two people have commented that if we were to include everything else we get from fossil fuels, taking tight oil, shale gas, coal etc. into consideration, the true number would be closer to 200 Billion Energy Slaves. 

Alas, if I changed the title of the blog I’d probably lose a lot of links and readers. Saying that, anyone with a more mathematical bent than I is free to send in their calculations for how many energy slaves we actually would need if ALL non-renewable sources were taken into account. I would hope that it would include the reasonable assumption that slaves cannot work for more than 12 hours a day. 

I’ll send a box of Cornish fudge to whoever sends me an email (jasonhepp at gmail dot com) with the most comprehensive answer before the end of October. 

Thatcher: The Oily Lady

Margaret Thatcher: the first peak oil prime minister

 

There has been an awful lot of debate raging since former British prime minister Margaret Thatcher died last week. And like many debates that raise the emotional tempo this one is crystalizing nicely into two competing camps, namely the camp that says she ‘saved’ the UK from decline and the camp that says she left it a scorched moral wasteland where only the greedy and the bigoted flourish.

Regardless of what one might think of her policies however, what has been mostly missing is the role that oil played in her ascendency. When she came to power in 1979 Britain was a dark and miserable place. At least that’s the official narrative; from what I remember things were actually not that bad at all. I, as an 8 year-old boy, could roam around my local town at will without anyone regarding this as unusual, the music in the charts was pretty good, television was for the most part entertaining and giant supermarkets had yet to suck the life out of local communities. Things were pretty good if you didn't read the newspapers.

But one aspect of life in the 1970s that could hardly be called good was the price of oil. The two oil shocks that had occurred earlier in the decade has threatened the onward march to a wealthier, more comfortable, future. People might have been watching the Good Life on television, but that didn’t mean they actually wanted to give up their jobs and raise pigs in their own back yards. Something had to be done!

Enter Thatcher stage right. The grocer’s daughter from Grantham hit the moribund political scene like a whirlwind, smashing taboos and giving the whole gentleman’s club a sharp kick up the backside. Like any successful politician in a democracy she had identified a deep craving within the psyche of the electorate and had used the power of promise to unleash a wave which she rode to victory as well as any Oahu surfer.

Although people didn’t realize it, they had just done a deal with the devil. No, not Thatcher, the devil I am referring to is right out of Doctor Faustus and its name is oil. Thatcher, and her ideologist in crime Ronald Reagan, pulled every trick in the book to flood the world with cheap oil. North Sea production was ramped up off the coast of Britain, and Reagan did the same thing, eliminating price controls on oil and natural gas in the US. Deals were struck with other oil producing nations to do the same thing and pretty soon the price of oil – and thus the price of everyday life in the industrialised world – crashed to a level so low that it was hardly worth thinking about. The age of mega-abundance was upon us.

Britain, along with much of the industrialised world, then moved into a peculiar position. The access to cheap energy and materials might have been temporarily secured, but Thatcher had a dragon she wanted to slay in the form of the unions. British industry, as she saw it, was inefficient and stuffed full of unproductive suits and workers – most of whom happened to be socialists. The miners’ strike is the best remembered battle here, and Thatcher, by now power-crazed, refused to back down – and won. 

But who needed industry anyway? It was much cheaper to get poorer countries to make stuff for you. I remember going on a school trip to a factory where they made tennis racquets. The production manager gave us a talk and I clearly remember him saying that they were ‘offshoring’ soon to China where ‘Each worker will make ten tennis racquets for a bowl of rice.’ And we children all nodded sagely at what seemed to make sense.

Instead of industry we got finance. The so-called Big Bang happened in 1986, when the shackles were thrown off the City of London and financial firms were, not to put too fine a point on it, allowed to create money out of thin air. This proved to be much easier than making cars or ships or digging up coal, and the tax receipts were fantastic too. Nobody mentioned the fact that the whole thing looked like a Ponzi scheme, and the boom in the 1980s swept everyone up, including many of Thatcher’s former naysayers who suddenly found they were doing quite nicely out of it. There can be few more spectacular examples of this than the former Marxist comedian Alexei Sayle, whose stock in trade was lambasting Thatcher and the Tories with foul-mouthed invective. Sayle now test drives luxury cars for the right wing Telegraph newspaper and he’s tied himself in quite a few rhetorical knots trying to explain that one. 

But bitter cracks had opened up in the national discourse. Who had the greater moral right to exist? Was it the pit miner, whose family had worked in the same pits for generations, or was it the new breed of financial whizz-kids in the City, who wore red braces and said things like ‘Greed is good,’ into their brick-sized mobile phones? Well, we know who won that battle, if not the debate, in the end.

Individual families were riven – including my own. Once, my aunt and uncle came for dinner. I must have been about 15 at the time, and after a couple of glasses of wine a discussion started between my father and my uncle about the coal miners. My father was ardently pro-Thatcher and had done well out of her policies, whereas my uncle was a socialist through and through, and drove an ambulance for a living. Things became heated and my uncle said to my aunt ‘Get your coat, dear,’ and they walked out. I never saw or heard from them again and have no idea if they are dead or alive. Such were the divisions that opened up over Thatcher.

Now, almost thirty years later, it is clear what Thatcher’s legacy was. She, and others like her, rode to power on a gusher. People wanted a cheap way of life and she gave it to them. The billions of barrels of oil that have been wasted over the last few decades could have been used to build a new infrastructure that didn’t rely on the assumption of an infinitely available and cheap energy source. Instead, we wasted it on expensive plastic yachts for the rich and cheap holidays on the Costa del Sol for the poor, and a million other things in between. The chance we were given was squandered.

Was Maggie to blame? Yes and no. She might be a figure of hate for the left and a source of quasi-religious devotion for the deluded neoliberals on the right (including, I might add, Tony Blair) but ultimately, if she hadn’t come along, someone very like her would have seized the same opportunity. Is this how democracies seize up in the end? With two ultimately competing blocks of voters vying for their own share of the pie and regarding the competing faction as ‘evil’? What would Jung say ...

People often accuse her of making Britain a crueler, nastier place. Is this true? I have no idea. Looking at it the other way around it could be said that a modern industrialised lifestyle was making Britain a crueler, more atomized, society and that Thatcher was merely our totem. She was the crucible that allowed the 60 million residents of these islands to access vast material riches at the expense of the Third World, and to burn our way through oil supplies that took billions of years to form. She allowed the proud nationalists among us to perpetuate the myth that Britannia had not quite finished Ruling the Waves, and that it was our manifest destiny to remain Great. 

Without her, or someone like her, our energy descent would have proceeded in a nicely linear fashion. It’s fun to do a thought experiment on this one. Imagine, for a moment, that instead of electing a Thatcher, we had elected a dull leader lacking in charisma but with the nation’s long term security at heart. This leader, instead of throwing her weight behind motorway and airport expansions, chose to support and invest in bicycle power and energy from windmills. Her government made it law that every house should be thickly insulated to cut down on energy loss, and that cars should be taxed at 200% so that you had to be quite well off to afford one (reinvesting the money in public transport instead).

Yes, Britain would have looked like a larger version of Denmark, where all of the above were followed through on. But instead we got a massive road network that is constantly jammed and unsafe to cycle on, millions of new flimsily-built properties that leak heat like sieves (I have freezing toes as I write this in the fairly expensive 1990s-built house we are currently renting) and an energy grid that is geared for failure.

So, instead of a painful but relatively gentle transition to a future where the ability to harness energy slips slowly from our grasp what we can expect instead is a traumatic and sudden drop-off of available energy exacerbated by a painful financial crash that will likely be the most traumatic time since the cities were bombed to rubble by Hitler.

Luckily for Maggie, though, she won’t be around to experience all that. That joy is all ours.

Peak Oil: All Going to Plan

 

Something wicked this way comes? Lightning strikes Cyprus.

Perhaps it’s the unseasonable chill that has settled over Britain and shows no sign of abating but there’s a decidedly gloomy feeling in the air. Something doesn’t feel quite right; indeed it’s all gone a bit Twilight Zone of late.

I’d hazard a guess that the eerie feeling is the initial and ongoing onset of cognitive dissonance that is growing in the damp basement of the nation’s consciousness. It’s that uneasy feeling that all is not well and that all is not going to be well, despite how many times the politicians and techno optimists tell us everything is on track.

And that’s just the small minority of people who take a passing interest in current affairs. The majority, whose days are filled with TV entertainment shows, sports and other diversions, must really be wondering what the hell is happening and why they are suddenly finding their options for living a normal life constrained ever more with every passing month. It must be the government’s fault.

But this is what peak oil looks like. It’s what peak oilers have been saying it would look like for years if not decades. In fact, we are following the script to a tee, which makes it all the scarier because we know what is coming next. We can tick off the following as ‘happened already’:

• Global liquids (excluding ethanol etc.) plateauing and supply remaining constrained despite growing demand
• Which in turn led to a huge hike in oil prices that has stayed with us
• Thus causing a permanent state of close to zero growth or shrinkage in the major industrialised nations
• And a shortage of food in much of the Middle East, leading to riots and revolutions
• Followed by a desperate scramble for unconventional fossil fuels, such as shale gas, tight oil and deep sea oil

Furthermore, we were told to expect politicians to do anything to restore the expected growth paradigm, and that all of their efforts would be in vain because of their collective failure to recognise energy inputs as a limiting factor for economic success. We can certainly tick that one off the list as well.

So what’s next in the peak oil recipe book of How to Make a Global Disaster of Epic Proportions? Well, almost certainly we can expect to see the wheels come off the global financial system. The 2008 ‘credit crunch’ was just the first distant rumbling noise of an approaching storm, and what happened in Cyprus last week was the first violent flash of lightning as that storm makes landfall. Depositors now face losing 60% of their bank deposits in what looks like a smash and grab by the troika of the IMF, the EU and the ECB. I’d be surprised if many of them saw anything at all of their deposits back. Europe is so phenomenally broke that to ‘fix’ the debt would require some several hundred trillion dollars. Reality check: the entire world economy is only about 70 trillion dollars measured in annual GDP.

Those on the inside know the scale of the problem and we are now seeing the first part of the great deleveraging. For the past hundred years or so we have seen a giant credit bubble grow – the biggest credit bubble in the history of the world. There is now something like 99 units of phantom ‘money’ for every unit of value. Those in the know are quietly getting rid of their soon-to-be-worthless paper wealth and using it to buy up tangible wealth in the form of solid productive enterprises, land, minerals and gold. Empires in waiting are quietly disposing of their US debt and buying up precious metals, and the average man in the street thinks the fact that the US stock market is rising means that everything is doing fine (just don’t look at the trading volumes, which tell another story).

Why is finance important? Because, as Nicole Foss tirelessly points out at The Automatic Earth, finance is the operating system of the global economy. If it crashes, then nothing but a complete system reboot will restore the economy. Indeed, when it does crash we will see economies freeze up, like has happened in Cyprus. Forget a 1 or 2 percent drop in GDP, we’re looking at anything up to 50% wiped off the value of the economy in short order.

The history of humankind is a history of snatching. First it was just basic land snatching from one another. Slavery was a form of snatching other people’s energy and using it to get useful products and money from the land we had snatched. Then we discovered oil, giving us the chance to snatch energy that had taken millions of years to form. This in turn allowed the creation of the biggest credit bubble in history, which is a form of inter-temporal snatching i.e. appropriating wealth in the form of debt from our descendants. Now that the inter-temporal wealth bubble is collapsing in on itself the clever snatchers who know that the game is up are busy appropriating productive assets with the idea of leaving the rest of us out in the cold to freeze.

We didn’t mind the snatchers as long as the game was on the up. We were quite happy to buy shares and over-priced property and take out private pensions. But now that the game has been thrown into reverse we are losing our trust in the institutions that rely on trust to function. Banks, corporations, regional and national governments. And as the trust erodes (prior to an all-out stampede when a critical mass of people catch on) these centres of power will do whatever it takes to maintain the concentrated core at the expense of the periphery.  Once that happens panic will set in as people suddenly realise that they are actually on the periphery, and an unholy scramble for ‘safety’ starts- although by then it will be too late.

In the meantime we are fed an illusory series of bubbles, which rise into the air before our eyes, shimmering beautifully. A bubble in this sense is an apparition of wealth that convinces us of its value. It rises up, expanding as it does so, getting bigger and bigger as people inflate it with their wealth. It’s a law of physics that an expanding bubble will always burst and a law of human nature that some people will always insist that this isn’t true. That’s what our economies are doing these days. In the absence of creating real value they are instead merely blowing bubbles for reasons of political expediency and the enrichment of financiers extracting wealth from the suckers among us. 

Bubbles might be ephemeral, but when they burst they create real damage in the real world. Industries crash, people lose everything, political careers are cut short and everyone says ‘never again’. We’ll likely witness the bursting of the shale gas bubble pretty soon which, among other things, will spark off an energy panic and case stage two (or perhaps it will be three) of the financial crash.

So contagion is likely to be the order of the day. Europe will contaminate the US (despite an initial flight to the illusory safety of the US dollar), China will struggle to service its infrastructure under the deadweight of its reckless expansion, and everywhere else in the world will bear the brunt of the ensuing chaos. A vast deflationary period will ensue, probably for a century but maybe longer, until economies can reestablish themselves at a lower level of energy throughput and with a lot fewer mouths to support because several billion of us rely on business as usual to ensure adequate food for our survival. 

And that’s just the financial problems, which in the long run are actually the least of our worries. Following financial collapse and the inevitable wars that will ensue (Europe is laying down the groundwork for one right now) we’ll be hit with the kind of power shortages that nobody in the 21^st century really likes to contemplate. There may well be plenty of oil left but that doesn’t mean you or I will benefit from it. What’s really important is traded oil. Once a country, say Saudi Arabia or Venezuela, falls below a certain threshold of oil production needed to keep the local population happy, the idea of selling it abroad becomes deeply politically unpopular. The only way to then get at that country’s oil is to fabricate a casus belli and invade it. It’ll be a pity that the major economies will likely be too broke to finance such resource wars.

Telescope events again and even the great energy crunch of the next few decades will pale in significance to the great damage we are doing to the environmental commons, with topsoil, the oceans and the climate all being left in a state far less capable of supporting life than they are even now. That is the great gift we will leave our children and their children and so on.

It doesn’t give me any joy to contemplate this, or to say that these predictions are coming true. Indeed, it’s hard enough being a Cassandra when people don’t want to listen. Try telling any of the above to the cornucopian techno optimists and they’ll tell you to perk up a bit and put your faith in the scientists or policy makers or economists. Soon it will all be flying cars and trips to Mars. Indeed, there’s been plenty written in the last couple of weeks on the peak oilosphere about the modern religion of progress, and some of us would do well to acknowledge that we’re probably also trapped by it to some extent. The realization of the trap is perhaps even harder to bear than when one considers our current predicament in any depth.

And that’s another techno trap of our age – the assumption that the universe operates along linear lines. That’s why we put hope in economists who regard monetary and fiscal policy as scientific instruments. Just tweak this knob and this will happen. Pull that lever and that will happen. But that’s not how the real world operates – economies are human constructs and as such they are vulnerable to the vagaries of human irrationality and emotional drivers. Fear and greed are two words conspicuously absent from economics textbooks. 

And it’s the same with science. Most people these days erroneously equate science with technology. Thus scientists in labs create the latest iPhones and cures for diabetes. Give them enough time (and money) and they will cure cancer and perfect cold fusion. Just don’t hold your breath while you are waiting.

So what hope is there? Well, it’s not my intention to dish out hopium. For what it’s worth I’ve spent the last week researching shale gas and coal for an article. I had a long phone conversation with Carl Shoupe in Kentucky, who used to be an Appalachian coal miner and now fights big coal in a town where everyone is a) working for the coal industry and b) is being shafted by the same. He says that even in this community some people are starting to twig that blowing up mountains and bulldozing the rubble into valleys wasn’t such a bright idea after all. There’s a bit of hope for you.

And what else? I’ve been out meeting local food producers, including organic farmers, fishermen and various artisanal producers. It’s heartening to see such a thriving network of local foodies, even if it is against a backdrop of continued supermarket expansion and a general lowering of food quality. I have been a bit surprised by the lack of organic food in the shops in the UK – there seems to be far less than when I lived here last in 2000. People, on the whole, seem to be going for the cheapest, junkiest food and the situation seems to be getting worse all the time (the only ‘job creators’ in the news seem to be the big fast food chains and the discount food stores – all of whom are doing very well. Yet another facet of peak oil.) So from now on I’ll be getting my organic foodstuffs delivered in a box once a week from a local farm. It costs more than the local Tesco, but at least it won’t poison me and my family and it’ll provide a bit of extra income for a local farmer.

But even so, if the supermarket trucks stopped rolling tomorrow, how much food would the regional food network where I live be able to supply? 10%? 15%? Who knows. Hopefully it was pay to get to know the people growing the food I eat.

In the meantime I’ve been concentrating of getting some resilience built into my own life. A few fruit and nut trees have gone in at Fox Wood – the start of a forest garden. I’m stocking up on tools and various pieces of equipment while I can. I might even get that poly tunnel set up this year instead of next – there’s no point hanging around. I know it’s not much, but it’s a start, and you’ve gotta start somewhere.