Here in the homeland, we peaked in 1970 and we extract relatively little oil on land or at sea. BP’s 100-million-barrel reservoir off the coast of Alaska — er, rather, on a BP-constructed island, and therefore not offshore at all — will meet U.S. demand for less than a week. Meanwhile, long-time swing supplier Saudi Arabia is turning off the tap. So much for satiating our infinite desires with limitless oil from the Middle East. Even the International Energy Agency forecasts demand in excess of world supply.

As world oil supply has fallen, the price has exceeded $80 per barrel twice in recent history. Both events were followed shortly thereafter by sovereign-debt crises in several countries. We’ll likely cross the $80 threshold again soon, even as the industrial economy continues to nosedive. Considering the debt-related economic pain in Europe despite throwing money at the issue (i.e., papering over the economic mess), Keynesian economics makes no sense at all. The printing press hasn’t been sufficient in the U.S., either, and it’s the one-size-fits-all solution of the Obama/Bernanke team. This is the typical government approach: If it ain’t broke, fix it until it is.

I’m not suggesting the debt-based approach hasn’t been broken for a long time. But every attempt to “fix” the industrial economy represents a boondoggle atop a boondoggle, with every one destined for failure at a faster rate than the prior one. Helicopter Ben has created half the U.S. money in history within the last four years even as the money supply continues to crash. On one hand, states want more federal stimulus (i.e., keep the presses running) as the head into a second-half economic tsunami with no clue how to deal with it. On the other hand, pressure is building to stop or slow the printing presses, but it’s already too late: We cannot possibly pay off the current U.S. debt, so — from the perspective of Bernanke and Obama — there’s no point in slowing the presses now, despite ludicrous, vacuous threats from various factions of the tea party. Meanwhile, the sheeple are growing frustrated as they wonder where the jobs went and why the industrial economy remains in the abattoir. Nobody in a position of influence has the guts to tell them about energy decline and its economic consequences; even if anybody with the ear of the people were talking about it, the hyper-indulgent sheeple wouldn’t have the guts to listen, much less act on the knowledge.

Hyperinflation might be on the way, despite the crash in cash. At the very least, the near future will bring increased volatility and a host of economic woes.

The water is boiling around us and, like frogs, we’re failing to notice. Unlike frogs, we have the ability to see what’s going on, and how it’s killing us, but we prefer the culture of make believe over reality. So we pretend we’re immersed in an imperial spa. Fever? What fever? I just need another drink. Apparently the cancer of industrial culture removes cognitive capacity before it kills the host.

Continuing to pretend won’t help the dire situation on the housing front. As it turns out, housing and energy definitely are not too big to fail. Despite out best efforts to ignore reality, echoes of the Great Depression abound. As housing prices continue to decline, Americans lose the ability to use their homes as ATMs. As oil prices continue to increase, aftershocks continue to rumble through the system, with more quakes on the way.

And it’s not just housing and oil. The collapse in commercial real estate is fully under way, banks are withholding information from the federal government because they dare not open their books in the light of day, another credit crunch lies right out the corner because nothing about the financial system has changed since the last crisis of confidence, and bond vigilantes are coming to America and therefore to the world’s reserve currency.

Plenty of people here in the empire think there are alternatives to oil, thus failing to distinguish derivatives from alternatives. These derivatives will never pay their way, of course, much less serve as anything resembling a comprehensive substitute to crude oil. And without abundant liquid fuels, we cannot grow the industrial economy.

Other folks believe hydropower will keep the lights on in their neighborhood, without working through the consequences of capitulation of the stock markets. Why would the engineers and technicians keep showing up to run the electrical plant if they aren’t getting paid, either because all the banks fail or their employer’s stock is worthless?

Too little, too late, Bill Gates is urging us to spend billions on an energy revolution. But he’s not spending his billions on it, probably because he knows the fossil-fuel party is over.

As a result of running out of inexpensive oil on the way to passing the world oil peak in 2005, we witnessed an oil shock in 2008 that nearly brought the industrial economy screeching to a halt. Chief Executive Officer of insurance giant Lloyds warns of another price spike headed our way, and I cannot imagine the industrial machine of planetary death surviving oil priced at the expected $200 per barrel.

Source: EIA Annual Energy Outlook 2009

But I’m an optimist, as I’ve pointed out before. I think we can terminate the industrial economy before we move the assault from the Gulf on our southern border to the wholesale destruction of interior lands on our northern border even as it becomes increasingly clear the tar sands will not meet expectations. The events in the Gulf of Mexico illustrate an important point: As my detractors have been saying for years, we really are awash in a sea of oil. Are you happy now?

The disaster in the Gulf provides a perfect opportunity for the dead hand of Ronald Reagan to rise in the form of judicial activism. This pattern is blatantly apparent in the Supreme Court and all lower courts and is consistent with the notion that the right-wing thought police have taken over this country.

In support of my omnipresent optimism, historian Niall Ferguson has added his voice to the large and growing chorus predicting the collapse of U.S. empire by the end of 2012. If we cease to kill the industrial economy, it will continue to kill the living planet and all of us who depend upon it. Either way — with imperial collapse or reduction of Earth to a lifeless pile of rubble — we can stop worrying about power politics. As should be evident to any reader by now, I prefer a robustly living planet over a dying or dead one. As should be equally apparent to any sentient being, I don’t have much company on this particular point.

The economic endgame is rearing its head. The stock markets are headed down — way down — with a monster shock headed their way. One plausible scenario has collapse of the bond market following collapse of the stock markets. But at Dow zero, you’ll be a lot more worried about feeding your children than the rate of return on your bonds.

Meanwhile, out in the dying murdered Gulf of Mexico, BP has claimed success. Calls for a boycott will fade away and clueless Americans will continue to display an inordinate capacity for cognitive dissonance as they continue to demand abundant cheap oil even while throwing the occasional tantrum at Exxon-Mobile BP corporations providing our drug of choice. You might go so far as to call this yet another example of American psychosis.

Will human life be wiped out by events in the Gulf of Mexico? In a word, no. We’re taking quite an impressive toll on the entire planet, but destroying our entire species with only the tools we’ve developed during the last two centuries will take more than a few years, our vaunted technological prowess notwithstanding. The Titanic of ecological overshoot has crashed into the iceberg of limited oil, leading to a painfully slow descent of the industrial economy. The descent is painful because it allows us to keep the current game going, re-arranging the deck chairs as we head straight for a rapid decline in the human population in the wake of a devastated Earth.

There is a better way. We know what it is. It’s time to give up our childish dreams and act like responsible adults. Is that too much to ask?

Don’t you know, yeah, yeah

The hour is late as the game enters the top of the ninth inning. The home team has held the Industrialists scoreless, and leads by a single run. If the Industrialists score, the home team will bring out the bats.

Don’t you know that you are a shooting star

The lead-off batter for the Industrialists reaches base on a bunt down the third-base line. A sacrifice fly to deep right follows a sacrifice bunt, advancing the runner to third with two outs.

And all the world will love you just as long
As long as you are

Nature’s pitcher checks the runner at third before smoking a fastball low and away. The Industrialist’s best hitter swings and misses.

“Strike one,” cries the umpire behind home plate. “You’re out.”

Johnny’s life passed him by like a warm summer day

Incredulous, the batter turns and stares at the umpire. The Industrialist’s manager storms from the dugout to argue the call. But it’s game over for the Industrialists. Nature wins again. All the appeals will be for naught.

If you listen to the wind, you can still hear him play

Stunned by the outcome, the few fans of the visiting Industrialists file out the exits as the fans of Nature collectively exhale a sigh of relief. A few angry Industrialists lash out, injuring Nature’s players for a final time. But everybody knows it’s over. Nature didn’t even need to use its last turn at bat to win this one.

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Perhaps Osama bin Laden was correct when he said, twelve years ago, oil should be priced at $144 per barrel. Perhaps this price will suffice to bring down the empire. Perhaps the first post-peak spike in the price of oil will yet do the trick.

President Obama and his lead lackey Ben Bernanke have managed to paper over the gaping holes in the industrial economy for 18 months, largely because the clueless fans of empire have been watching reality television instead of paying attention to reality. As managers of the industrial age, Obama and crew have effectively argued against economic collapse. Among the many costs to industrial humans, which admittedly pale relative to the costs to non-industrial humans and non-human species: criminal banks and ongoing erosion of the freedoms we once took for granted.

All that arguing could have been spent preparing an unprepared citizenry instead of creating a diversion from the central issue of our time. But that’s water under the proverbial bridge. Instead of a recovery, we’re witnessing an economic death spiral. Although it seemed absurdly unlikely as little as a few months ago, it is becoming evident that the economic impacts of passing the world oil peak are still running full-out. We might not need a second spike to bring the shooting star of industry down to Earth.

Johnny died one night, died in his bed
Bottle of whiskey, sleepin’ tablets by his head

Woah …
Don’t you know that you are a shooting star

It wasn’t supposed to turn out this way. The industrialized world was supposed to have time to prepare alternatives to oil. Or so goes the mainstream story.

The ongoing story runs contrary to conventional wisdom. This version of the traditional narrative includes a twist, completely unexpected by most readers (and especially by economists). Just when it appears Nature is down for the count, even as Nature is gasping for life through the many assaults of industry, even as the living planet is turning belly-up and taking our species with her, a light flickers.

At first distant and dim, the light grows until it obscures the darkness of industry. Plants grow through the asphalt and then cloak the highways and bridges. Cities give way to small towns. Machines give way to nature’s bounty. The global horde of humankind gives way to a compassionate host of humanity.

This version of the story includes a Hollywood ending and a feel-good, bumper-sticker mantra: Nature Bats Last.

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This essay is permalinked at Energy Bulletin and Island B.reath

Of course, had stock traders known the dire nature of AIG, for an easy example, the economy would have completed its ongoing collapse long ago. Fortunately, Americans prefer presidents and presidential candidates who lie about the likes of AIG (and, as nearly as I can distinguish, everything else).

But back to the smoke-and-mirrors recovery. It’s fizzling out and there is worse to come. The Wall Street Journal predicts collapse will come in 2011. Over on CNBC, the recommendation is to buy barbed wire as the endpoint of devaluation appears. Others prefer a different phrase: the next step down, also known as a dead end. If you’re a part of Saudi Arabia’s royal family — welcome to the blog, by the way, and feel free to post a comment — it’s time to get out before the apocalypse comes to the kingdom.

For the imperialist-in-charge, what to do, what to do? Now that the Keynesian approach has about run its course, Obama is set to re-open offshore drilling program in a feeble attempt to keep the current game going. And there’s undoubtedly more stimulus headed our way, even though we already passed the point of debt saturation: each new dollar of federal debt now subtracts 45 cents from GDP.

If you’re having a tough time swallowing the notion that the economy can go from apparent recovery to the toilet in a few years, remember what most people believed in 1930: they thought the bad economic news was behind them, too. It’s looking a lot like 1930.

Even usually clueless Americans are getting nervous about the economy — apparently they’re no longer watching television. But even the ever-soothing voices on the tube are pointing out that the gusher in the Gulf is getting worse by the day, with economic implications bound to bury the coast for decades. The BP spill is probably gushing on the order of 100,000 barrels per day, not the 70,000 bpd reported by BP, a number that keeps going up as they keep repairing the problem. The spill certainly exceeds estimates by ultraconservative marine scientists.

But even the latter scientists agree about the existence of the undersea plume (or cloud). I am definitely not applying the “scientist” label to anybody working for the Obama administration: those former scientists gave up their integrity card when they started lying in the name of political fortune. Their new jobs are to hide the facts, not reveal them.

Despite the ongoing game of obfuscation, striking similarities have emerged between the financial collapse of 2008-2009 and the Gulf disaster. Among other characteristics, BP is paralleling the actions of the big banks, aided by the Obama administration, in covering up the truth. It comes as no surprise that BP CEO Tony Hayward has racked up a “greatest hits” list of quotes only a politician’s mother could love.

Energy analyst Matt Simmons predicts BP will declare bankruptcy within a month. That would be one way to escape paying for damages. The more likely approach, in my opinion, is a full-scale bailout by you and me. That route is already wending its way through Congress, although GOP House leader John Boehner is shying away from the idea he proposed earlier.

In a stunning bit of good news — in the category of throwing us a bone — BP finally released the list of toxins in the dispersants. Now that I’ve seen the list, though, I’m not particularly happy about it.

Finally, a single article from the mainstream points out that maybe we should re-think our oil-drenched lifestyles. Oil drilling threatens our future, as even the BBC has determined. Will that be enough to get us off the devil’s excrement? Certainly not if Barack Obama or the politicians in Louisiana have their way.

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This essay is permalinked at Energy Bulletin and Island Breath.

2. It’ll take a lot of rats to clothe plus-size models in the latest fashion accessory.

3. Encouraging us to keep the weight on, the American Heart Association endorses Nintendo’s Wii. Please put aside your shovel and turn on the TV.

4. Japan’s Prime Minister has put an ex-swimsuit model in charge of solving the problem of declining birthrate in that country. Ratcheting up planetary ecological overshoot is an idea whose time has come.

5. Also on the topic of objectifying women in the name of sex, Charlie Sheen has ensured one of the world’s stupidest television shows will remain on the air by settling for $2 million per 22-minute episode to play a misogynist adolescent. The new season will have to wait until he pays his dues for beating his wife and threatening to kill her. For his indiscretion, he’ll serve 30 days in jail (or, more likely, barely supervised community service).

6. Apparently trying his own hand at situational comedy, BP CEO Tony Hayward says BP is capturing a majority of the oil from the spill, as well as claiming the gusher is spilling only 10 million barrels of oil each day. The media play along, naturally.

7. It’s no wonder ethical investors include BP in their portfolios.

8. By now, we’re probably all aware who’s to blame for the ongoing disaster in the Gulf of Mexico. It’s those pesky environmentalists, of course. Sarah Palin says so.

9. Last week’s article in the New York Times is yet another fine piece of journalism, considering the source. If the article had been written by a semi-literate 12-year-old, it might have warranted a passing grade in an American elementary school. The paternalistic piece of ass-wipe disguised as journalism quotes a single “prepper” and a single authority. The latter, Daniel Yergin, is the renowned energy optimist who believes crude oil emanates from a limitless, juicy nougat in the center of the planet. Even the title points the wrong direction: For the dozen or so of us who care about the living planet, we’re preparing for the best of times, not the worst.

Also last week, in a rare moment of introspection the Times asks whether we shouldn’t self-induce genocide. As if we’re not.

10. And, on the topic of genocide, self-proclaimed uber-environmentalist Bill McKibben is begging Barack Obama to resurrect our energy policy so we can keep propping up the omnicidal machine of civilization. McKibben is becoming increasingly desperate to finish the job of destroying the living planet on which we depend. With examples such as these, Sarah Palin seems right on the mark.

The financial sector has been largely nationalized, with the U.S. taxpayer on the hook for trillions of dollars of bad loans made by big banks. Back in February 2009 our national debt was a mere $10.5 trillion, but it already exceeded the value of all the currency in the world and all the gold ever mined. Those were the good old days. Now our national debt exceeds $13 trillion (with more than $8 trillion still hidden from view), and the empire will go down like a tub full of gold bricks if we stop fanning the flames by slowing the printing press.

By running the printing presses at full speed, we are inflating the most massive bubble yet. We’ve seen how those bubbles pan out for the industrial economy. If we build them, the pin-pricks will come. Can we create another financial crisis? Of course. After all, a smoke-and-mirrors economic recovery is no protection against a crash in the equities markets. The peak in industrial economic growth is already here, with about ten thousand swords out there vying for attention to burst the bubbles of Treasuries, the U.S. big banks, China’s economic growth, the re-inflated housing market, and a renewed credit crisis. Oh, and of course the interaction between these myriad factors. In summary, the countdown is well under way for completion of the ongoing U.S. economic collapse, and there’s simply no way to soften the blow when we plunge to the bottom of the economic heap. The U.S. has the world’s biggest industrial economy, and the bigger they are, … well, you know.

The one-size-fits-all solution of printing money is leading inevitably to hyperinflation, even as the U.S. money supply dwindles. Think Zimbabwe, but with U.S. dollars. And the U.S. dollar is still the world’s reserve currency. All signs still point to a major crash in stock markets (see here and here, too, among a kajillion other sites). At this point in the post-peak oil era, it’s clear to anybody paying the slightest attention we’re headed for full spectrum collapse.

How will it end, and when? It seems completion of the U.S. economic collapse will follow on the heels of Europe, which is cheering for its own demise even as all the PIIGS drown in a sea of debt. This is supremely good news, of course, for the dozen or so people who care about non-industrial cultures and the living planet: Our little reign of terror is just about over. We’re an empty garbage can, playing power games enabled by the hologram-like appearance of power.

I’ve no doubt the empire will fail to go silently into the night. Instead, we’ll take out individuals and countries with every lethal weapon in our power, including weapons most of us don’t even know about and people we don’t care about. Iran apocalypse? Could be — talk about mutually assured destruction — and soon. How soon?

Your guess is as good as mine. But is it as good as the 25 leading trends forecasters, who agree that 2010 could be the year? Hedge funder Hugh Hendry provides a concise summary: “I would recommend you panic.”

As much as I appreciation the concision of Hendry’s recommendation, I would recommend you prepare and celebrate. I’ve been recommending the former for several years, while pointing out the good news associated with economic collapse. I have more company now than I’ve had for a while: Economic collapse has gone mainstream, and the occasional worthwhile ecologist is joining Daniel Quinn and Derrick Jensen in recognizing and spreading the good news.

Even as the gusher in the Gulf gets much worse by the day (thus diverting our attention from BP’s other large spill), even as Barack Obama tries to use the disaster to push his ill-founded political agenda, even as the cozy relationship between BP and the Obama administration becomes clear, so too do U.S. political policies keep steering straight at the iceberg of economic and environmental collapse. As the industrial economy stumbles along, the world’s biological diversity continues to suffer even as we peer into the abyss of extinction for many of the world’s species (including, ultimately, our own).

Where should you be when economic collapse comes to your house? Michael Ruppert and his protégé Rice Farmer suggest staying where you’re most comfortable. Much as I appreciate their efforts to inform and engage economic collapse, this advice seems immoral and short-sighted to me. First, it’s the comfort of city living that got us into this civilized mess to begin with, and it’s exactly this comfort that requires obedience at home and oppression abroad. Second, today’s comfortable urban existence might not be so damned comfortable when the lights go out and the water stops coming out the taps. Rice Farmer points out that people in rural areas will “have to cope with hordes of desperate, starving city people who try to steal our food. Unless you are in a really remote location, expect hungry visitors.”

Good point. But why do you think those “hordes of desperate, starving city people” are bound to be desperate and starving? Why do you think they’ll be leaving the cities in hordes? I’d guess it’ll be because they’ll become suddenly and profoundly uncomfortable when the grocery stores run out of food and the water stops coming out the taps. If you think you’ll be comfortable surrounded by a few thousand desperate, starving city people when TSHTF in your backyard, by all means stay in your comfort zone. On the other hand, if you don’t think that’s going to work out well for you, I’d recommend skedaddling out of the city before the real rush gets under way. When will that be?

In this case, “better late than never” is the wrong answer. The time to dig a well is not when you’re thirsty. The time to plant a garden is not when you’re hungry. The time for securing your water and food is now, before the industrial economy burns itself out. You and I didn’t start the fire of empire. But we’re about to see it extinguished.

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This essay is permalinked at Island Breath.

And, because the taxpayers are so easily swindled by TPTB, there is little doubt they will fail to notice or, more likely, will believe the inflation-induced salvation of Greece is a brilliant move by the Economists In Charge. Judging from today’s explosive jump in stock markets, the swindle worked brilliantly. But volatility in the stock markets is back, so today’s huge gain will be wiped out by week’s end, perhaps in a ten-minute spasm subsequently blamed on a computer glitch that cannot be rationally explained. Glitch? If you believe that, then I’ve sell you some ocean-front property in Arizona. Well, it’s not ocean-front property yet. But we’re certainly headed in that direction.

But let’s go back to that coffin. Following the lead of the last remaining hyper-power, Europe is generating a mountain of debt so high it cannot be imagined, and therefore cannot be dealt with.

The black hole of debt has gone global. We’ll never pay off the debt because it cannot be paid off. But the average American believes every word that ends with illion is the same as every other word that ends with illion, so he goes back to the television while sucking down cheap beer and cheese doodles. Failing to recognize the effects of debt for him and his equally ignorant children, he keeps cheering on the military while booing the politicians, gleefully following American Idol while bitching about the quality of the public schools, bemoaning those poor fishermen in the Gulf of Mexico while filling up his SUV with gasoline and blaming Obama for not fixing the deep-sea oil gusher, blaming his elected representatives for high taxes (sic) while demanding eternal solvency of Social Security and Medicare, and calling Barack Obama a socialist even as the president nominates a fascist to the Supreme Court.

Citizens have become consumers. (Ben Franklin: “It is the first responsibility of every citizen to question authority.”) We have abandoned the pursuit of inquiry, thus trading skepticism for suckerism. (One every minute is a massive underestimate from people who cannot distinguish millions from trillions.) We traded in our union cards for the promise of free money without reading the fine print. Having thoroughly fucked the planet and ourselves, we’re all playing extend and pretend, wishing for economic growth for our own generation (while willingly shit-canning future generations, as we’ve always done).

Eyjafjallajökull blowing smoke, ice melting at an accelerating rate from Antarctica, oil covering the Louisiana coast, biodiversity taking the fast track to oblivion at our oil-soaked hand, and on and on until the real news becomes so sickening we readily, eagerly, happily turn to reality TV (sic) or other mind-altering substances to get us through the week. If I weren’t a rationalist, I’d swear the third rock from the sun was trying to even the score with its most clever species.

Fortunately, even Ben Bernanke knows the odds are dimming on an orderly collapse. Don’t look away from the television now, but the post-industrial Stone Age is coming into full view.

Will it arrive in time to save the last remnants of the living planet? Will it arrive in time to save our species? Considering the planet’s atmosphere currently holds 387 ppm carbon dioxide, with 350 ppm the likely upper limit humanity can tolerate for an extended period, I have my doubts. Toss in methane, which is far more powerful than carbon dioxide as a greenhouse gas, and we’re currently experiencing the equivalent of 460 ppm carbon dioxide.

If that seems problematic to you, perhaps you’re numerate enough to distinguish between millions and trillions. Consider yourself a rare industrial human.

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This essay is permalinked at Counter Currents and Island Breath.

As adults know, hope is for little kids and tooth fairies.

Today’s panic-infused stock-market crash was an ode to days economists thought long gone. But those economists continue to be stunned at every substantive event, as if passing the world oil peak couldn’t be expected to generate any economic consequences.

“High prices will cause the market to generate substitutes,” they cry. I guess we can expect a comprehensive substitute for crude oil to show up any day now. Or perhaps these long-predicted swings in the price of oil will continue to destroy capital and therefore lead to one canceled alt-energy project after another.

I suspect we’re back on the stock-market rollercoaster with a general trend down. Probably way down, by year’s end. But the crash that completes the collapse of American Empire could come any day, and today was a near miss after a six-month series of near misses came to a halt last March. The Dow lost about a thousand ticks today in a 15-minute span before the plunge protection team (PPT) took quick action to save the imperial day.

Oh, wait, there’s no PPT. It wouldn’t be completely legal for the federal government to buy stocks in the beloved free market, would it? And certainly not when the mantra is hope change transparency. I guess those traders just came to their senses and regained confidence in the markets. Lucky thing, too, from the imperial perspective: Another hour without intervention from the PPT and we’d be looking out over the smoldering ashes of the industrial economy this time next week.

If all goes well, the U.S. will be forced into hyperinflation or default even before the next oil-price shock brings down the industrial economy. If we’re really in the midst of the empire’s last dance, soon enough we won’t be forced to choke down lines such as these:

“There’s more war in America’s future — a great deal more, judging by the Obama Administration’s reports, pronouncements and actions in recent months”

“U.S. exempted BP rig from environmental study”

“The world may be on the brink of biological disaster after news that a third of US bee colonies did not survive the winter”

“Scientists and environmentalists from around the world assessed the state of global biodiversity and found that it has been in steady decline”

“An American Chernobyl”

And so it goes, headline after headline, until the process of killing the planet to transfer money from the poor to the rich finally succeeds in killing us, too. Until, if the corporatocracy running the industrial show has its way, the last human on the planet accumulates all the material wealth and celebrates gleefully with his last breath.

This story could end another way, if only we’d let it. If only we’d trade in hope wishful thinking for action, the culture of make believe for the reality of the real world, insanity for reason, the horrors of extirpation and extinction for the living planet, a dead-end road in a hellish future for the heavenly wonders of life itself.

How does one know what to believe, and who to trust? We’re surrounded by lies. During our finest moments, we don’t believe the media, the politicians we elect (from the very small slate of candidates selected for us), or the CEOs and NGOs to whom we give our money. Awash in misinformation yet surrounded by culture’s unrepentant, never-ending message, we vacillate between cynicism and swimming in the powerful current of culture.

Although the happy-talk Obama administration — and its proxy and partner in crime, the mainstream media — would have you believe the industrial economy has recovered, many signs indicate the impacts of the last oil price spike haven’t been fully worked out. The U.S. national debt rises every day, and it already exceeds the value of all currency ever produced and all gold ever mined. It cannot be paid off. Ever. If the notion of a Soviet-style default doesn’t give you pause, consider still-rising foreclosure rates, still-falling home prices, massive unemployment, financial bankruptcy at all levels of government, ballooning entitlement programs, and collapsing pension programs. This is merely the short list of economic issues we face. Needless to say, every single one of them is a profound surprise to the vast majority of neoclassical economists, few of whom saw this economic recession coming (as if passing the world oil peak didn’t provide sufficient warning, well in advance).

Knowing culture will lead us astray, we nonetheless invite scorn when we seek the truth beneath the cultural current of the main stream. Culture does not have answers to meaningful questions. But skepticism for the sake of skepticism is no virtue, either.

Applying reason as a path to knowledge (as I’ve suggested here and here, for example) is easy enough in theory. But in practice, it’s difficult to extract the facts and then synthesize them into a coherent message that guides the way. Much less the Way. And yet, we muddle along, individually and societally, relying on some inexplicable combination of faith and rational thought. For me, the guides include data (recognizing they are undoubtedly massaged before general release), historical anecdotes (ditto), my own dubious moral compass (shaped, necessarily, by culture), and an informed set of predictions from a variety of scholars. As with any gestalt, mine is formed from parts that don’t quite add up to the whole.

So how do we go from this list of economic issues to the notion of economic collapse? I’ve moved from imperialist city educator to economic doomer rural sharecropper in one (damned difficult) step. This move was driven by many factors, including the profound (and profoundly late) realization that we live immorally, buying and selling nature’s bounty at an imperialist whim. Another contributing factor was my strongly held suspicion that we’re headed for a collapse of the industrial economy by the end of 2012. If the industrial age does not end soon, we’re headed for the complete absence of habitat for humans on Earth. Obviously, there is plenty of disagreement with me on both points, and I’ve been asked to make my case. What tea leaves do I read?

I restrict this essay to economic collapse, thus leaving the issue of environmental collapse to previous posts (and perhaps future ones). The data on collapse are clearer than the rest of my guides, so I’ll start with them.

The data interact with other elements: History indicates 10 of 11 recessions since World War II and all 6 recessions since 1972 were preceded by a spike in the price of oil. The lifeblood of civilization, and its price, dictates the direction of the industrial economy. At some point, the price of oil becomes too great to maintain the industrial economy. In fact, a per-barrel price of $147.27 nearly brought the industrial economy grinding to a halt. Only massive, and massively illegal, intervention by the executive branch of the U.S. government kept the lights on in your grid-tied house, the trucks coming to the grocery store, and water coming out the taps. These actions have been written about widely. A quick search on “plunge protection team” is a nice starting point, although the issue is far broader than even omniscient Google reveals.

For information about oil supplies, I rely on Hubbert’s model and data from the U.S. Department of Energy’s Energy Information Administration (EIA). Hubbert’s model indicates we passed the world peak for crude oil in December 2005. Data from the EIA indicate peak month was May 2005. Because the industrial economy is barely limping along today, in far direr condition than when the price of oil exceeded $140, I doubt it will take a second round of $140 oil to bring the industrial age to its overdue close. Several forecasters suggest we’re headed beyond that mark with a year or so.

A little more from history: Empires fall. All of ‘em, so far. Some fall slowly, others rapidly. Some fall with a modicum of grace, others with extreme violence. American Empire is so complex, so dependent on finite materials, and intricately connected with the entire global economy that it’s difficult for me to foresee a long, peaceful decline.

The industrial economy relies heavily on crude oil, and particularly inexpensive oil. We’re perfectly willing to spend $400/gallon for gasoline to support our imperial ambitions in Afghanistan if that’s what it takes to keep the price of oil at a reasonable level for us exceptional Americans. (How exceptional? Check the charts in this essay.) But when the price of gasoline exceeds $4/gallon in the heartland, there’s trouble brewing for our all-important economic growth.

In addition to the near-term price of oil, our empire is threatened by the ever-tightening grip of globalization, which ensures that economic collapse in any of the world’s large economies will lead, domino-like, to economic collapse throughout the industrialized world. This grip was allowed and facilitated by cheap oil, and it’s no coincidence that the end of the cheap-oil era resulted in financial crises throughout the civilized world. Today, Greece is the word. But Portugal, Spain, and Japan hover on the brink (Japan is the world’s second-largest economy). So does the U.S. and the remainder of the industrialized world, though you’d never know it based on mainstream media reports from this country. We have the advantages of the world’s reserve currency and the largest killing force in the history of the world (and the willingness to use it, everywhere, all the time). But when China stops buying U.S. Treasury notes, a process already under way, the de facto rate of interest will rise, taking us inexorably and likely quickly into the land of hyper-inflation. At this late juncture in the industrial era, the only questions of great significance are whether our bubble will pop before China’s, and which of myriad potential events will serve as the proximate cause to the end of American Empire. The price of oil was a trigger event, and it might be again. But it might not, too.

As far as my moral compass is concerned, I’ve written plenty about that. There’s no need to pummel the deceased equine yet again. Check the archives, if you’re interested. Or, for a different take on the situation, read this.

So much for the models, data, history, and my sense of morality. What about those voices I hear words I read?

When I open my browser to start the day, several tabs reveal themselves. Some of these websites give the facts, as accurately as they can be determined: Bloomberg energy prices, American stock markets, and the U.S. national debt clock. Others are information clearing houses with occasional original essays, notably including the sites of Matt Savinar, Mike Ruppert, Rice Farmer, and Chris Martenson, along with Energy Bulletin, Counter Currents, and The Oil Drum. Others provide synthesis and analysis: Business Insider, Baseline Scenario, Dmitry Orlov’s blog, Speak Truth to Power, Economic Collapse Blog, The Automatic Earth, and Zero Hedge. Finally, one tells me what people are thinking out there in the culture of make believe: MSNBC. Needless to say, that’s the scary one.

I’m not foolish enough to read every article, much less read every article linked from these pages. But there is plenty of fodder here, much of it informed by biophysical economics. Biophysical economists, unlike neoclassical economists, know about finite materials. As a result, the former know starvation can kill people. Any self-respecting neoclassical economist assumes the rumbling of his stomach will cause food to appear.

Now let’s pause for a quick story about neoclassical economists.

Four shipwrecked economists wash ashore on a deserted tropical island. The first Asian economist says, “I’ll gather wood and start a fire to keep us warm and cook our food.” The second Asian economists says, “I’ll find water.” The third Asian economist says, “I’ll find food.” The American economist sits down, smiles, and says, “When you’ve got that all taken care of, I’ll consume whatever you produce. You’re darned lucky I’m here: Without me, the entire system falls apart in a hurry.”

Note that confidence among U.S. consumers fell in April. Unexpectedly, of course.

We now return to our regularly scheduled essay.

Among the places these links lead are the following. This summer’s hurricane season likely will contribute to high oil prices. And we might not need the hurricanes: According to the International Energy Agency, world oil demand will set an all-time record this year, exceeding the amount actually being sucked out of the ground by 2.4 million barrels per day. The global financial system is primed and ready to implode. The Fed admits to breaking the law in the name of transferring wealth (and not to me or you). And the Fed, like the U.S., is bankrupt. That alone will cause hyperinflation. “Real estate built America, and it’s going to take it down. Foreclosures will be the wrecking ball for the American economy.” The economic crisis in Greece is just getting started. Recent reports of economic growth are mere mirages from the smoke-and-mirrors cabal behind the curtain (duh). More than half your tax dollars support the military (yeah, that’s sustainable; even an increasing percentage of military personnel is questioning whether they will accomplish their amorphous mission in Afghanistan). Warren Buffett bought the Burlington Northern Santa Fe railroad, calling it an “all-in bet” on the U.S. economy, as if he’d been reading the work of James Howard Kunstler. Buffett’s partner Charles Munger wrote a parable transparently about the U.S. economy titled, “Basically, it’s over.” A large European bank warned its clients about completion of the ongoing collapse by the end of 2011. The U.S. dollar will collapse, causing world economic collapse, by 2012. Catherine Austin Fitts moved from New York City to rural Tennessee to build a doomstead. As should be obvious, “from now on the risk of entering a collapse must be considered significant and rising” (pdf file). And so on. The evidence mounts daily, and it all points in the same direction.

My interpretation and synthesis of these many essays and the data on which they rely suggests the industrial age is near its terminus. How near? Recognizing the difficulty of predictions, and the animus they elicit, I’ll go out on the often-wrong limb of forecast and give us a 99% chance of “lights out in the empire” by 21 December 2012. And I didn’t even look at my Mayan calendar.

Reinhart and Rogoff’s 2009 book, This Time is Different, describes financial crises in 66 nations dating to the 13th century. For a change, I agree with the rallying cry of people subject to previous collapses: This time is different. This time it’s not one of 66 nations. It’s every country in the entire industrial world. Indeed, this time is different.

In short, civilization is only a few days removed from chaos or, if you’re an optimist like me, from anarchy. This has always been the case, for every failed civilization as well as the one left standing. With every passing day, we move further into ecological overshoot and also closer to the end of western civilization and its apex, the industrial economy. For most individual industrial humans, the end will not be welcome. But for the living planet on which we depend, and therefore our very species, the end of industry will bring a welcome relief from decades of oppression. It might even give us back our humanity while granting our species a few more decades of planetary existence.
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This essay was inspired by a comment from Marguerite Daisy. It is permalinked at Counter Currents, Bluegrass reVisions, and Island Breath.

Indebtedness is a form of servitude, usually involuntary, and, in extreme cases imprisonment. Consider, for example, current rates of interest, usurious compared to what savers earn on their savings in the same banks that charge that interest. Many religious organizations loath interest rates as immoral and criminal. According to all four gospels in the Christian bible, even the normally passive, peaceful prophet of Christianity got so worked up about usury in a temple he started acting like Bobby Knight on the sidelines of a basketball game.

Purchases by consumers (this awful word is used here only because that’s what we have become — involuntarily) drive the world’s industrial economy. And purchases by consumers depend on the confidence of those consumers, so that consumer confidence underlies commercial success. If a potential consumer has no confidence in his ability to purchase an item, then he won’t. If enough potential consumers lose confidence in their abilities to purchase and pay for any particular item, the sales of that item will plummet, causing the manufacturer and sellers of that item to fail.

Considering the current financial situation, which will no doubt crash again within the next year, we can help create a situation that will both change behavior for the better and prevent people from getting into financial trouble. The latter portion is vital to getting wide support, and will be a huge challenge for hopelessly optimistic, reality-challenged members of the industrial economy.

How do we convince people they definitely cannot afford to take out loans to buy things? More impact will be realized by targeting luxuries such as houses, cars, and appliances than small “goods.” The Obama administration recognizes this, and has therefore rewarded people for purchasing houses, cars, and — most recently – appliances, by giving them huge financial incentives (i.e., taxes on other Americans who might not even be tempted to play the “consumer” game).

Loans are required for most people to purchase these “durable goods” (which are no longer durable or good). Loans traditionally are seen as safety nets, but it has become clear they really represent traps. Never mind the psychological or ecological implications of consumerism — there exists no evidence suggests anybody has minded so far — the focus here is on the trap into which each potential consumer falls by taking out a loan to mindlessly invest in transient baubles. Every loan is a bad deal for the borrower, although credit cards represent the largest trap (even with the new rules).

The system needs you to keep borrowing. If you stop borrowing, then who knows what could happen.

The risk levels described below are approximate and will vary according to your personal situation and the jurisdiction in which you operate. Seek legal advice if you are uncertain.

No risk:

Don’t take out a loan for anything. If you need it — and probably you don’t — save your money and buy it, or barter for it.

Encourage others to join you. Start by sharing your car, your garden, your yard, and your lawnmower. Pass stuff on. Give it away. You don’t need that loan, and neither do the people you care about. Caveat: Sharing leads to liability.

If you already have loans, and most recent students do, then seek deferral under economic hardship. Odds are pretty high you’re actually experiencing economic hardship, so this is no big deal. And even if you’re not, there’s no sense feeding the beast if the beast defaults down the road. Caveat: If you lie about economic hardship, your claim about hardship is legally fraudulent.

Low risk:

Start a “misinformation” campaign (from the point of view of the loan companies).

1) Via snail mail, send out false press releases from loan companies and banks to media outlets such as local radio stations, local press and even the nationals if you are brave enough. These press releases should discourage people from taking out loans because, after all, people don’t really need all the toys they buy on credit. If you make the “press releases” as complete as possible, and word them so that responses are not required, then there is a good chance they will be run without questions being asked.

2) Do a bit of subvertising, on the internet or (for a little higher risk) on billboards: focus on loans companies and banks changing the messages to emphasise the theft aspect of loans. Alternatively, just remove loan adverts entirely. For more information on techniques, read this post.

Other potential actions along these same lines include:

Obvious satirical routines can be developed for a variety of venues. This strategy should hold particular appeal to artists.

Medium risk:

Walk away from your mortgages, as suggested by Dave Pollard: Many Americans are now living in homes with mortgages that are greater than the value of their property. Why would anyone continue to pay a debt that is higher than the asset it secures? After all, big corporations view pulling the plug on unsuccessful ventures and sticking the debtholders and shareholders a key business strategy. The whole idea of “risk capital” is that the interest and other fees you earn for lending to risky borrowers compensates you for the risk, so that if the borrower defaults you accept the loss and chalk it up to experience. Yet for some reason homeowners feel some moral obligation to throw good money endlessly after bad. This of course is exactly what the corporatists, who have no such moral compunction, are counting on, what economists call moral asymmetry. The logical response would be to tell the lender to write off the excess of the mortgage beyond the property value, and refinance the mortgage accordingly. Apparently in some US states (called “recourse” states) this moral asymmetry is institutionalized — that is, lenders can go after a mortgagee’s personal assets if they default. There is, of course, no recourse when the corporatists walk away from debts, offshore their operations, and stiff the taxpayers whose subsidies and bailouts paid for the corporatists’ ventures.

Where is the sense of outrage here? Have the education system and media so dumbed down the citizens that they can’t see this scheme for the cruel and criminal con it is? If everyone with a mortgage greater than the value of their home either walked away from it, or was legally empowered to require the excess to be written off as the “bad debt” it is, then of course there would be many bank failures and plunging profits. That’s how the market system is supposed to work. The lenders, of course, want it both ways, and Obama and the citizens consumers seem blithely willing to let them have it.

Walking away from your mortgage entails medium risk because it will damage your credit rating. Obviously, this doesn’t matter in the long term, but it still causes concern for many people. Additional risks vary among states, up to and including loss of assets for every person named on the mortgage.

Via electronic communications, send out false press releases from loan companies to media outlets. These press releases would discourage people from taking out loans because, after all, citizens don’t really need all the toys they buy on credit. This scheme requires technical expertise: The instigator will hide behind an alter-ego and fake domain.

High risk:

Taking a step beyond abandoning your underwater mortgage, don’t pay off your mortgage even if you’re not underwater. Simply default but continue to occupy your house. Ditto for other loans (but kiss your car goodbye when the repo man does his job). In many cases, lenders can ill afford to tell their stockholders about toxic loans, so — if you avoid undue attention and your loan is too small to “bother” with — the borrower gets the loan for no payments while the lender gets stuck. This point was viewed as radical as little as a year ago, but the idea has been receiving plenty of attention from the media, and even CNBC is on board.

Tactics for throwing off the shackles of debt

These actions are high risk because they could bring criminal proceedings related to fraud. Probably they won’t. But stranger things have happened, so we issue the following disclaimer:

Recognizing that even civil disobedience is illegal, the authors and the host of this web site do not condone any actions that break the law under the jurisdiction where the described activity is taking place.

Which, of course, doesn’t mean you shouldn’t do them at your own risk.

What we’re trying to do here is help bring down a house of cards: People feeling forced to pay debts far greater than the real value of the assets that secure them. People seduced into getting into debt needlessly. People paying usurious interest rates and fees because the banks own the politicians. It’s a debtors’ prison without locks and doors, and it’s immoral. Please help us bring an end to it.
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This essay is part of a larger collaboration between the authors. It represents the third month of the Monthly Undermining Tasks

Indeed, Prescription for the Planet promises to save the planet. But instead, it develops a prescription for furthering the industrial economy and therefore killing the planet. Saving? Killing? Apparently some people think these words are synonymous.

Ultimately, Blees’ plan boils down to two “solutions,” both of them extremely suspect. First, he claims we can we can ramp up production of renewable energy systems and also fourth-generation nuclear reactors to keep the power on. Indeed, Blees claims our lives depend on electricity. As such, he dismisses the first two million years of the human experience. If our lives depend on electricity, it’s because we’ve abandoned a viable, durable set of living arrangements in exchange for endless opportunities to destroy the living planet. Second, Blees promotes the notion that boron-powered automobiles will keep us on the highways. And he thinks that’d be a good thing. After all, boron seems to be essentially limitless on this world. Just as crude oil seemed, not so long ago.

First, let’s consider and dismiss Blees’ electrical option. Figures on energy supply and efficiency are readily available for renewable systems, so it is relatively simple to evaluate Blees’ map to determine whether “alternative” energy sources can fill the void at the scale of a world with nearly seven billion people.

They can’t. And it’s not even close. I don’t know a single energy-literate individual who thinks we can replace fossil fuels with alternatives by 2030. Most people who write about energy issues have concluded we’ll be firmly in the post-industrial Stone Age well before 2030. I’ll not run the numbers here because I’ve run them many times already, and so have a lot of people a lot smarter than me. But I’ll start by picking a few nits, then I’ll move on to the big-picture moral issues we try so hard to avoid in our national conversations.

And, I’ve written about one kajillion times, all electrical power is derived from oil, even nuclear power. We use plenty of oil to transport nuclear materials (even the stuff Blees discusses). And also for maintaining the grid. And then there’s the massive mountain of concrete needed to build cooling towers for nuclear power plants. As a result, nuclear plants become carbon neutral only after about 20 years in operation, at which point we start shutting them down for safety reasons.

And what about those cars? Building a planet’s worth of boron-powered cars will require a lot of oil. My Prius uses less energy than the cars Blees writes about, but it still requires more energy to construct than a Hummer. I seriously doubt we have enough oil in the world to make enough cars to replace the U.S. fleet, much less get a billion Chinese cars on the road. And then there’s the issue of financing, in a world where credit is drying up faster than Lake Mead. Who will be able to buy a $40,000 car with cash?

If all goes according to Blees’ plan, the first fourth-generation nuclear power plant will be producing electricity in 2015. I strongly suspect, and hope, that we’ll be in the new Dark Age by then. This Dark Age will cause much suffering and death among industrial humans. And I think it’s our only chance to save the living planet, and our own species.

Further along Blees’ road to ruin, by 2020 plasma energy will fulfill 5% of our energy “needs” and boron-powered cars will be filling the roads. I cannot imagine a scenario in which we will avoid landing in the post-industrial Stone Age by then.

And even further along the route of Blees’ nuclear wet dreams, we’ll have all the nuke plants we need to satisfy the world’s demand for electricity by 2050. If we come even remotely close to that goal, there will be no humans on the planet to use the electricity. The latest (ultra-conservative) projections indicate extinction of our species by mid-century.

And that’s just the small stuff. The moral issues are much more daunting.

The further we go into ecological overshoot, the worse the outcome will be for every species on the planet, including our own. Maintaining the ability to produce more cars, and more babies, is a prescription for the planet, all right: a prescription for disaster. There are limits to growth. I strongly suspect they’re driven, in this country, by the price of oil. If not, rarity of other materials will force our hand.

Hopefully, our hand will be forced in time to prevent our extinction. It won’t happen, though, if we return to the American lifestyle of happy motoring. We certainly do not need to export car culture, and its many attendant consequence, to other nations.

Meanwhile, against Blees’ backdrop of fourth-generation nuclear ambitions, Barack Obama is pushing for an older version of nuclear dreams. He’s committing serious bling to build nuclear reactors in all the wrong places, ignoring the fact that nuclear power is the twentieth century’s most expensive technological failure. Even Time magazine knows this bet won’t pay off, that the nuclear dream is really a nightmare. Even as Obama pursues failed technology in the homeland –- while denying other countries the same option — he wants to maintain or expand our nuclear arsenal in the name of security (sic).

Fortunately, the next great economic crash is right around the corner. After the China bubble pops, the human population bubble surely will follow. It’s time to grow accustomed to chaos as an everyday event.

As usual, you can count on me for the good news associated with life in the doomosphere. Soon enough, we won’t be threatening the entire living planet with extinction via carbon dioxide emissions. Or by flooding the atmosphere with methane. Soon enough, we won’t be spending all your hard-earned tax money on oil, much less on securing that oil at the point of a bazooka. Soon enough, Afghanistan will be a distant memory instead of a broad expanse of imperial killing fields. Soon enough, Obusha will not be able to order the massacre of civilians on a whim. Soon enough, the world’s largest companies will not be able to cause $2.2 trillion worth environmental degradation each year. On the other hand, it’s time you started thinking about how to spend your own money, while sellers still think it has inherent value.

I know my message is not the one desired by industrial humans. We want our children to have more stuff than we had. Instead of more stuff, I want them to have more of the living planet, if only to insure their own survival (and that of our species). In contrast, Obama’s dream is the same as Ronald Reagan’s dream: economic growth at all costs, including obedience at home, oppression abroad, and the devastation of the planet and all non-Americans (with the possible exception of Israelis).

Western civilization is omnicidal. We need to stop murdering the living planet on which we depend, instead of attempting to extend the reach of western civilization. And we’re running out of time. Fortunately, the conquest of the living planet has turned into a war. And now, finally, this war has two sides. Which side are you on?

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This essay is permalinked at Island Breath.