Crash course

I appreciated an article by Paul Roberts, author of The End of Oil in 2004, which appeared in the June 2008 issue of National Geographic. But I enjoyed the resulting letters to the editor even more. The six letters published in the magazine’s print version covered a wide range of beliefs, and I print two in their entirety because they represent the end points as I’ve come to see them.


First, from John P. Hammett in Midland, Texas: “We should immediately allow unlimited drilling on all federal land not in a national park or monument and all offshore areas, including the Pacific, the Gulf of Mexico, and the Atlantic. The law of supply and demand is still working. We can work our way out of the mess by increasing our supply. We cannot conserve our way to a surplus; we can only lower our standard of living, our health, and our security by using less.”
My comment: WTF? We lower our security by using less oil? I’d bet this guy’s a McCain supporter. Here’s what renowned energy expert Matt Simmons says about McCain: “John McCain is energy illiterate.” “He’s just witless about this stuff. As a lifelong Republican, I’m supporting Obama.” A dozen oil and gas men sitting around a conference table in Lafayette, La., chuckle nervously as he continues. “McCain says, ‘Oh, we’re going to wean ourselves off foreign oil in four years and build 45 nuclear plants by 2030.’ He doesn’t have a clue.”
Drill, baby, drill.
Back to National Geographic with an excellent letter from Jason DeVries from Lindstrom, Minnesota: “Some familiarity is found when comparing oil and toothpaste. I need toothpaste daily. The tube in my cupboard once held a large amount, easily obtained. I squeezed and watched with pleasure as the paste poured out. Lately, however, it has been more difficult. I know it is there, but it’s harder to find and is discovered only with significant effort. Recognition of my depleting reserved occurred some time ago, but my concern has been buffered, for each day the paste ultimately arrives. Even now, when the tube is flat and worn, I know that extreme pressure near the nozzle will produce ‘white gold.’ Sadly, such effort produces false hope, for experience reminds me that one day even that will stop. My supply will run dry.”
I couldn’t have said it better myself.
If you’re interested in a crash course in economics — the real version, albeit based on neoclassical theory — check out the crash course posted by Chris Martenson. It’s worth the three hours, in 3- to 18-minute doses.
And while we’re on the subject of economics, here’s some absolutely huge news from across the pond: France is hosting a summit within the next few days. The goal: eliminate hegemony of the U.S. dollar. Hello, Greatest Depression.

Comments 22

  • Slavery
    I think the human condition involves involuntary slavery to habit and comfort zones (the familiar). I have seen reports in the past few days that the lowered cost of gasoline has already begun to drive sales of trucks and SUVs back up. The Congress balked yesterday at the bailout, but today the talk from both parties and both presidential candidates is of the need to preserve the known structure of finance that preserves institutional comfort (Stick with the failed familiar).
    This tells me once again that a paradigm shift to a post-carbon world will not come as a result of wisdom, foresight, and prediction. Any major shift will only come as a result of trauma, fear, and attrition of alternate choices.
    But who am I to criticize — My doctor told me a couple of years ago I had preliminary Type II diabetes and gave me a prescription for an oral medication, yet I am still occasionally eating sweets and have yet to fully transition to an ideal diet. I cannot stop myself from some reliance on past habits even with full intellectual knowledge of my likely fate!
    I am a slave. I think everyone is. I am somewhat of an informed slave and have made some progress towards modifying my enslavement, but it is amazingly slow and progress is precarious and always subject to setbacks.
    I guess this means I am human. As some might say, “born in sin and shaped in iniquity”.
    Born to struggle in my own way. I’m a slave to my own goddam weaknesses.
    Stan Moore
    Petaluma, CA

  • Stockholm syndrome
    A long time ago someone told me, “You can’t save the world, Stan. It doesn’t want to be saved.”
    The Stockholm syndrome (if I remember the name correctly) describes a situation where a kidnap victim begins to identify with the kidnapper. Patty Hearst, for instance, identified with her kidnappers and became “Tanya” and actually assisted them in robbing a bank to further their goals, if I remember correctly.
    Our society has become like that. Most of the exploited so identify with their manipulators that they do everything in their power to preserve the system of exploitation, to their own net harm. What they are trained to see is a small piece of the picture, their immediate gratification compared to the slower, insidious harm they cause and ultimately suffer from. Timber workers complained that environmentalists were shutting down timber harvest and saw mills to save forests until one day they realized that industry had overharvested the forests, sent the lumber to Japan for custom milling there, and their jobs were lost more or less permanently, along with the forests that could have been harvested sustainably.
    In some cases, awareness of these facts at the micro level can institute change for the better. But it is probably true that we can’t save the world as it now exists because it really does not want radical change, which would be required. And the scale of the disparity of balance between population and consumption combined with the reality of Peak Oil as a one-time historic event means that our world is going to have to radically change in what will most likely be a traumatic experience for literally billionis of humans alive today.
    So, observing these matters does not imply that they can be corrected. It could mean that they will not be repeated in future generations. But even that cannot be taken for granted, human nature being what it is.
    Stan Moore
    Petaluma, CA

  • Guy, et al.—
    Here’s my column on the subject, and attempt to get through to the folks not in the choir. Mostly I just annoy them. Have been a fan of your work since “Human Extinction.” JR
    Mayan Economics Lesson
    One archeological theory about the collapse of the Maya is based on evidence that they had perfected a bureaucracy of corn. Exhaustive rules governed how corn was grown, distributed, and consumed. A rigid hierarchy defined every individual’s social position and allotment of corn, and this cultural arrangement lasted almost 700 years.
    But when drought and declining soil fertility reduced the corn supply, established procedures no longer worked. One city after another fell until nothing was left but jungle-covered pyramids and toppled stone calendars. On the hillsides above the ruins, small villages grew tiny amounts of corn that allowed lives that were nasty, brutish, and short.
    The Bush Administration’s attempt to solve the American financial crisis had precedents in the throne rooms of Mayan city-states.
    “We need more corn,” chief financial ministers said to cacao-addled Mayan kings. “Unemployed tortilla-makers are rioting in the ball-courts. The people on the bottom of our hierarchy aren’t getting any corn at all.”
    “No problem,” the kings said. “We’ll borrow corn from our Mayan brothers in the
    other city-states. Look at Chichen Itza. They’ve got corn. We’ve sent them tons of corn to pay for the jade jaguar statues and giant stone calendars that their slaves make.”
    “Chichen Itza won’t lend us any more corn until we pay back the corn they’ve already lent us. Besides, they’ve got so many slaves that they’re eating the huge corn surplus they’ve built up.”
    “Then own slaves must work harder,” the kings said, “for less corn. That will bring efficiency into our agricultural economy.”
    “We tried that,” the ministers said. “They keep dying.”
    “Then we will form an alliance with Tikal and Palenque and march on Chichen Itza and take their hoarded corn away before their slaves eat it all.”
    “That could work,” the ministers said. “We’ll equip all our unemployed tortilla-makers with spears, and attack those greedy Chichen-Itzans and get our corn back.”
    The Mayans must have all had the same idea at the same time, because continuous wars between city-states put impossible demands on an already struggling corn economy. The slaves who grew the corn refused to give it up to government tax collectors and had to be killed. Armies trampled the Mayan cornfields to dust.
    The Mayan population crashed. Human sacrifice went from being religious ritual to protein source. Bad things happened to kings whose unemployed tortilla-makers were defeated by another king’s unemployed tortilla-makers.
    Through all of the collapse, kings were still kings. High priests still prayed to Jaguar gods, who were still gods. Bureaucrats still begat bureaucrats. Deep patterns of cultural behavior persisted until death and beyond. If a minister of taxation was killed by angry corn-growers, another minister of taxation miraculously took his place.
    Mayan history suggests that America has perfected a bureaucracy of money, and that the financial structures that have resulted from this bureaucracy will persist long after the money’s gone. There will be a Federal Reserve even when there is no Reserve, and not much Federal. Bailouts will happen even when there’s nothing left to bail. More and more unemployed will be sent to fight more and more wars. The people on the bottom of the hierarchy will be squeezed so normal life can go on for those at the top.
    Through it all, there will be a relentless reduction in the supply of wealth. The future archeologists who ponder the ruins of small city-states in the desert of North America will know that even as the increasing price of oil siphoned money out of the American financial system, its cultural rituals survived far longer than they should have. Completed but unused airports will be seen as the expensive monuments of a quasi-religious cargo cult. Ruined amphitheaters and sports complexes will be identified as sites of human sacrifice, where high priests of losing financial-services companies had their hearts torn out and eaten by the high priests of winning financial-services companies. Money will have remained a god even in its absence.
    Those future archaeologists will move sand, not jungle, to uncover the works of the Americans. Our drought will have been longer and more severe, aided by the CO2 created by burning the last remaining fossil fuels. Our extensive canal system will have been buried under dunes. Here and there, shifting sands will reveal objects of ancient worship: BMWs, Mercedeses, and the occasional Jaguar.

  • Guy: Thanks for sharing that “toothpaste” letter. I enjoyed it, myself.
    Stan: I couldn’t agree more with the idea of people being slaves to their habits. I’m in that boat, myself. I’ve got high cholesterol, but damned if I do anything about it. My mantra is, typically, “I’ll get to it next week.” Of course, on some level, I know I’ll probably have a heart attack before I actually get to that elusive “next week.”
    Maybe habits and habituation are the biggest sins ever imagined…

  • Neil Young —
    I always loved the music of Neil Young. And when Neil was a bit younger, he sang “It’s better to burn out, then to fade away…”
    I have the deep feeling, based on the human condition, that if Neil rewrote the song now, he would sing “I’m starting to yearn now, for just another day…”
    All of us want to live. We want our civilizations to live. We will put them on life support to buy another day. And it will always be this way.
    And If I want to relax and enjoy a really good frame of mind, I might very well listen to Neil Young’s “Harvest Moon”. It is part of my chosen culture.
    Stan Moore
    Petaluma, CA

  • Jerome Guillet
    Jerome Guillet, often known as Jerome a Paris, is a French banker and financer of wind energy projects in Europe. I enountered him originally on the Claverton Group listserver of Yahoogroups, which is essentially a discussion amongst a bunch of British and European engineers and energy experts on solving the pending British energy crisis. I raised issues with Jerome regarding the potential threat posed by poorly sited wind turbines on birds of prey, such as Scottish golden eagles, and found his response to be completely responsible, rational, and acceptible to me. Basically his view was that poorly sited wind farms were bad business practice and thus bad investments, and thus he recommended that financing of wind energy facilities take environmental issues such as bird mortality into the financial equation.
    Jerome regularly does energy and financial commentaries on websites such as http://www.EnergyBulletin.net
    Here is today’s excellent piece on the U.S. bailout and its impropriety. Notice the last couple of lines — nothing short of amazing! I am highly impressed with the morality and ethics of this banker and it tells me that the corrupt financial/securities system in play now is not a financial necessity, but a parastic burden on our entire civilization.
    Today’s essay can be accessed at the following link:
    http://europe.theoildrum.com/node/4584
    submitted by Stan Moore
    Petaluma, CA

  • Only somewhat on-topic, but: Has anyone heard rumblings about a “bank holiday” coming up? I keep hearing rumors that BofA is going to be “out to lunch” for about a week. Does anyone know if this is true or what it means? Thanks in advance.

  • Bluecollar and No Collar Blues
    Joe Bageant is a wonderful writer who expresses the worldview of those I would call the Bluecollar and the No Collar Class (or the stepped-on ones). Here is his latest essay telling us exactly what is going on right now:
    http://www.counterpunch.org/bageant10022008.html
    submitted by Stan Moore
    Petaluma, CA

  • new use for those big SUV’s people mortgaged thier houses for
    I think it was on the Claverton Energy Group discussion a couple of months ago that I made a fecetious argument that appears to have actually become a reality. More and more people are being dispossessed from their overpriced houses due to foreclosure. Some bought big, comfortable SUV’s that are not so good for commuting to their non-existent jobs anymore. But they make nice sleeping accomodations until they, too are repossessed. The website http://www.iraqwar.mirror-world.ru has a lead article today about the “new American way of life” including a woman who sleeps in the back of her vehicle with her two golden retrievers. She is a 60+ year old formerly employed victim of the collapse of the economy as many have known it. Some localities are setting up parks for people to sleep in their cars. Why not make an “Expedition” of it or turn your Land Rover into a “Sleep Capsule”?
    Stan Moore
    Petaluma, CA

  • Sorry Guy, but I am a McCain supporter. As much as I hate to say this, he’s the lesser of the two evils and thus gets my vote. If you sit out, I don’t think you can complain later, so either way I’ll at least get to complain about whoever wins, even if I voted for him.
    I just can’t bring myself to vote for someone who’s entire economic, military, and energy strategy can be summed up with the word, “Change.” Change doesn’t instantly imply a good thing. Change isn’t any more of a strategy as hope is a destination.
    There’s the whole taking life advice from a racist, associating with a terrorist, and working for an association that has time and again been punished for voter fraud etc. Don’t get me started on who he’s talking about appointing to any level of his cabinet that used to work for FannieMae/FreddiMac.
    John Rember: I am not unemployed, nor am I by any stretch of the imagination “Poor” or a “Slave.” Last year I made well over $60,000 and I am both a police officer and now active duty military currently serving in the Middle East. The problem with your position is that more and more of us are being sent to fight for far more than just those at the top. We’re getting sent to fight for everyone. How long would any one of us last if tomorrow the price at the pump was eight, nine, heck, let’s be spunky, $10 a gallon? I’m stuck in the desert, Guy’s trying to get water from a well, and Frank’s got too much hair on his head! We’d be screwed!
    As much fun as even I’d think it was to see those at the top get dragged down a peg or ninety, if our oil supply is disrupted even a teensy little bit, we all get dragged down those ninety pegs. Sitting an inch higher in a pool full of crap isn’t going to make it smell any better. Where Guy and I disagree is that I say drill as much as we can now, and push all that energy toward figuring out exactly what the heck we’re going to do when it runs short, or better yet: a non-destructive alternative. I know that I’m living in the idealist’s world with my paisley horses and the ketchup bottle that talks like Billy Dee Williams if I think for a second that that one’s going to happen. Particularly without every hand on the way out looking for a wad of cash, the government’s bureaucracy being slow as ever, and finally the corporate bigshots skimming profit off the top, though it’d be real nice.
    I’m not just going to give up, bend over and take it like a man, however. I’ve made sure my effects are in order. I own my house, have no debts, and have an independent water source. (Conveniently enough from the same water table Glenwood Englewood takes their water from, only further down water-table where it’s even more pure) As long as we all keep our little corner of the world clean, we’ll all be better off.

  • Sarah Palin
    I don’t have a television, so I did not get to see the debate. However, I must say that I am getting a little bored seeing Sarah dressed in a businesslike black dress with a hairstyle that makes her look like a backup singer for Dianna Ross.
    If she would put her hair in a ponytail and put on a camouflage jumpsuit, I would buy a television set and watch the second debate, and especially if Joe Biden would also grow a ponytail and put on a matching camouflage jumpsuit. They could start the debate with calisthetics led by Jack LaLanne.
    Then, maybe for the next presidential debate Obama and McCain and their wives and the full 60 Minutes Crew with Mike Wallace, Dan Rather, Andy Rooney, Lesley Stahl, Steve What’s his Name and the late Ed Bradley could all be put together in the nude in a hot tub for a full two and a half hour “debate” at the Las Vegas Hotel Circus Circus. The loser of the debate would have to go and party with Sigfried and Roy and the other loser would have to party with Wayne Newton.
    And we could cancel the elections and try eliminating the Executive Branch altogether…
    PS: They’ve been spreading the ripe chicken manure from the hen house onto the fields of the ranch were I live and I might be a little light-headed and disoriented right now, but I sort of like the idea of eliminating the Executive Branch rather than the “Unitary Executive” we have seen recently.
    Stan Moore
    Petaluma, CA

  • Dear Charlene:
    Don’t worry about Bank of America,federal law requires them to be open.The government has the say on when banks may close for business.

  • Actually, rumors about a week-long shutdown of the U.S. banking system are running rampant in the blogosphere. See here, for example. I can imagine two scenarios, and I have no evidence to support either: (1) the information is reliable, or (2) disinformation is being promoted to panic Congress into passing the horrific bailout bill.

  • Would Congress spend this kind of money if they had any?
    Po’ folks know how to live on a budget. They have to because they don’t have much money to begin with, and they usually don’t have much credit, and if they do have credit they know for damn sure that if they don’t keep up with their credit installments they will have their washing machine repossessed and STILL get stuck with the bill.
    That is why we need a Congress full of poor people instead of millionaires.
    No one alive today (probably) can remember a time when the U.S. Federal government had a net positive balance of funds. Except for a year or two during the Clinton Administration when a technology bubble created an artificial illusion of surplus, we have had deficit budgets for years and years. They used to be of concern when they were ten to a hundred billion dollars. But it was considered “bad economics” to raise taxes to pay off those deficits. So, instead, Congress authorized the revving up of the printing presses and wealth (printed money, that is) was created by printing it.
    Nowadays, everything is in deficit. The banks, the Federal government, the state governments, the local governments, the carmakers, the airline industry — everybody is in debt. The debt level is so obscene that the Federal Government has to borrow billions and billions of dollars just to pay interest on their debt to their creditors and thus take on more debt without more actual programmatic spending. The printing presses are humming!
    Debt is so heavy that possession of debt counts for wealth itself for those who can manipulate the system. If you invent a new widget that sells with great popularity, the best financial move you can make is to borrow so much money for expansion that your creditors cannot allow you to default for fear of bringing themselves down. So, they keep loaning you more and more indefinitely just to demonstrate financial activity, and the preferred technique is to declare the debt itself as an asset (in the Orwellian sense) so that it can generate more and more assets (debts).
    Po’ folks don’t get to do this, and so they stay poor forever. There is more of a societal penalty in being poor than in being in huge debt. Huge debt is power and Congress plays the power game relentlessly.
    At some point, though, reality must intervene and an actual accounting must take place. if people don’t do it, Planet Earth is the ultimate accountant and it will perform the accounting that will restore sanity because, as Herman Daly said, the human economic systems are but a subset of earth’s ecological systems. Running a huge deficit and creating a huge bubble in the accounting system of Mother Earth is possible, but can only be extended so long.
    Remember the crash of the spaceship Challenger? Accountants at NASA decided to play fast and loose with the molecular accounting of the rubber on the solid booster seals. They thought they could fool Nature into granting the dividend of a successful launch, but Nature’s accounting came up with a different tally.
    They say that nature abhors a vacuum. And deficits are a form of vacuum. It is just a matter of time before natural forces restore equilibrium.
    Stan Moore
    Petaluma, CA

  • Debt into Asset is the proximate cause of the credit seize up we have today.Virtually all home mortgages are securitized into packages and sold around the world.

  • Frank: That’s partially what I’m afraid of–given the govt’s track record of late.
    Guy: I’d put my bets on #2, but I wanted to ask. I can’t believe the that swampthing got passed. Maybe it is just as well, though. As bad as it is, it pales in comparison to the other problems the country faces at the moment (like being willfully ignorant of PO).

  • Time out to take care of our own:
    We are a very special intellectual coterie,but we have social needs just like the Great
    Unwaswhed. Why then has not one of us asked about Our Stan’s itchy scalp ? How is it that not one of us has thought to commiserate with poor Turboguy over his having to walk more than a quarter mile in the sand to shake the dew off his lilly ? For that matter,did anyone congratulate Frank after he got a haircut ? Hummmmmmmmm ??.
    Please feel free to make amends for these oversights.

  • Correction:
    That is “The Great Unwashed” above.

  • Awwww…Frank, you poor thing. Sorry. Congrats on your haircut.
    As for itchy scalp–if it’s really bad: buzz it. I get really bad psoriasis from time to time. Last year it was really bad and I couldn’t take meds because of nursing my daughter so I had my hubby help me pull a Sinead O’Conor. UV from the sun is the best thing for that. Of course, Stan has the decided advantage of being male. But, if you’re desperate it works LOL.
    On a serious note, though, I was chatting with some folks over the weekend. I think people are starting to notice something is up. Someone told me they even sell MREs at Costco now. I said, if that isn’t a sign of impending doom, I don’t know what is.

  • Hey,
    Look at our Charlene.Isn’t she the greatest and smartest ever !!!

  • Charlene – Psoriasis is really bad. Whenever I get it, I try using neem. It has really got some medicinal properties. Try using it.