Sunday, April 23, 2017

"Reform" won't solve our biggest problems

"You never cure structural defects; you let the system collapse."

As I contemplated this proposition taken from a recent piece by Nassim Nicholas Taleb, I realized what profound implications accepting it would have for all those engaged in attempting to address our current social, political and environmental ills.

If it is true that modern capitalism is incompatible with effective action on climate change, if it is true that top-heavy, bureaucratic nations always eventually become captive to their wealthy citizens, if it is true that our centralized, complex, tightly networked systems in finance, agriculture, shipping and manufacturing are exceedingly fragile and prone to failure--if these all represent structural defects, then they cannot be addressed by tinkering or "reform." Those in charge cannot be persuaded to "do something" which is contrary to the structural necessities built into these systems.

The choices then are: 1) Do nothing, 2) insurrection (for which you might be jailed or worse) or 3) start building a decentralized replacement. Since I'm discarding choices one and two, I'll address choice three.

First, adopting choice three doesn't mean we should abandon critiquing the current systems under which we live. Quite the contrary. Those systems are where future adopters of decentralized replacements currently do business. They are the Brand X against which new systems can and need to be compared.

Second, we have good evidence that small-scale governments can actually respond to climate change when large-scale governments can't. Citizens of seaside communities experience the rising ocean waters first hand and have direct access to their elected officials as do those who experience droughts. And those cities have actually taken significant (but still inadequate) steps toward addressing climate change. It is counterintuitive that decentralized governments could act more quickly and effectively on issues of international scope than national governments until we see them in action.

Third, modern communications have become bifurcated. There are large media establishments very much wedded to the status quo and the power elite. The heavy concentration and centralized nature of this type of media makes them uniquely incapable of understanding and communicating much about the merits or even existence of decentralized alternatives.

Then there is the thriving and ever more seamless worldwide digital communication network which allows people across the planet to share their ideas, practices and discoveries with one another without mediation. We should not in this context, however, devalue good old face-to-face communication which still works best of all.

Much of what passes for "media" online is really an attempt to exploit readers for commercial gain and therefore much more a part of the centralized media system. But even here, little-known businesses with new approaches to serving small, niche needs provide an alternative to the conglomerated consumer companies of our age.

Fourth, the worldwide tightly networked systems which dominate our lives today are too fragile to last. But that doesn't mean they will dissolve all at once or at the same rate. Parts will decline, parts will evolve and parts will disappear on different schedules. Certain aspects of existing systems might actually be of some use in the new decentralized system. A warehouse used for international trade can just as well be used for regional trade.

We can boil at the inequities and destructiveness of the current system. There are times and places that are appropriate for that. But our best chance to traverse the the path to a more decentralized world while minimizing harm and maximizing success is to begin building it.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, April 16, 2017

Split personalities: We like some science, but not all of it

We modern folk are in a bind. We embrace what the sciences and the technology that flows from them have to offer, but we refuse to believe that we live in the world described by those very sciences.

Here I'm not merely talking about climate change deniers who, of course, fit this description. They merrily dial number after number on their cellphones, but they do so without realizing that in their climate change denial they are rejecting the very same science that underpins the phone they are using: physics.

But so many others live in this dual world as well. We humans imagine ourselves set apart from the natural world. And yet, our very bodies are the subject of scientific investigations. So we turn to our minds which we imagine set us apart from the natural world. But what is the mind? Do we not place the mind in the body? Are its manifestations not speech, writing, music, dance, and graphic arts which require the body for their expression.

The science of physics tells us that we live in a thermodynamic system. The universe is a thermodynamic system and so by definition must our Earth be one. Thermodynamic systems produce entropy, lots of it. Some two-thirds of all the energy we use in the United States is wasted. That's right, wasted. That entropy shows up as climate-changing carbon dioxide in the atmosphere which is also acidifying the oceans. It shows up as barren landscapes left behind by coal and other mining. It shows up as waste heat and waste products flowing from our factories, our homes and our vehicles.

In a broader sense, the entropy that we used to see and feel in the United States in the form of so-called "smokestack" industries has now been moved to China where another yet entropic problem, air pollution, chokes the urban population on a daily basis.

We think our presence is making the world more "orderly," but, in fact, we are filling it with new and dangerous expressions of entropy.

Geology tells us that metals, mined fertilizers, and our dominate form of energy, fossil fuels, are finite. The Earth is a sphere and has no pipeline to some other planet. And yet, there are people who claim with a straight face that resources including energy resources are infinite. This is so because "resources come out of people's minds." There's that word "mind" again. Just where does it reside?

We speak of leaving the planet and setting up colonies on Mars. But biology and physics tell us that those attempting to do so will suffer dementia resulting from the cosmic radiation that will bombard their brains. Humans on Earth are protected from this type of radiation by the Earth's magnetosphere. Not so in deep space or on the red planet which lacks a magnetosphere. There might be ways to protect such astronauts, but they would require much additional weight, both for the trip and for any enclosures or ships sent to the surface of Mars.

The point is that biology and ecology tell us that humans are evolved specifically to survive and thrive within the narrow strip of the biosphere. They can for brief periods with special apparatus live outside that. But long-term survival cannot be assured, in part, because the biosphere is far too complicated for us to understand and replicate. Attempts to do so have been miserable failures. The long and the short of it is that we aren't going to colonize space except as an expensive form of suicide.

Some look at measures of human well-being and declare that all is well and getting better. But this presupposes that we understand the biosphere better than we do. To analogize, you can live well on your savings until your savings run out. Likewise, humans can keep increasing their well-being by drawing down the natural capital of the biosphere (fisheries, soil, water, metals, fossil fuels), but eventually this drawdown will start to cut into the productivity of the biosphere as it has for many fisheries, water tables and some farmland ruined by erosion and salt. The drawdown will also affect the quality and price of fossil fuels and other minerals available as we seek the harder-to-get resources.

But perhaps what's even more important than what the sciences tell us is what they cannot tell us. Those on the cutting edge of their scientific disciplines are putting the lie to the idea that we are close to understanding how our universe works. Instead, what our latest researches are revealing is how little we know and how much more we have to find out.

Those who see comfort in this say that we can proceed full ahead on economic growth and the attendant speedup in resource extraction since we do not know for sure that they will kill us or seriously degrade our lives. What these people do is simply extrapolate the recent past into the future. It is a religious belief and not one based on sound thinking. What they do not take into account is the risk of systemic discontinuities, systemic ruin, that could come from climate change, resource extraction and new, untried technologies.

The approach is akin to playing roulette when we already know the wheel is stacked against us. In such a game, the more bets we put down, the more likely we will be ruined. But it feels great as long as we are winning.

It is the fate of the compulsive gambler to keep on gambling until he or she loses everything. That is our current trajectory, and it is a trajectory that requires a split personality regarding what we know from the sciences in order to maintain a false sense of security.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, April 09, 2017

Living world: Should natural entities be treated as legal persons?

This year the New Zealand parliament voted to give legal personhood to a river and provided for the appointment of two guardians to represent it. In India a court extended legal personhood to the Ganges and Yamuna rivers and the glaciers that feed them.

It defies our normal modes of thinking that natural entities such as trees, rivers, mountains, lakes, and glaciers should be given legal standing in courts and public life. And yet we take as a matter of course the legal rights of other inanimate entities:

The world of the lawyer is peopled with inanimate right-holders: trusts, corporations, joint ventures, municipalities, Subchapter R partnerships, and nation-states, to mention just a few. Ships, still referred to by courts in the feminine gender, have long had an independent jural life, often with striking consequences.

The quotation comes from a famous law review article on the topic of rights for natural entities entitled "Should Trees Have Standing? Toward Legal Rights For Natural Objects," written in 1972 by Christopher Stone, a professor of law at the University of Southern California.

Perhaps our most important blind spot is that we forget that we humans are natural entities as well. Scientists study our bodies just as they do the bodies of other animals--except that these scientists are not allowed to kill humans to dissect them or expose them to potentially harmful substances without informed consent. (Animal rights activists would argue that such protections should be extended to all animals.)

Ultimately, what's at stake is what our relationship with other natural entities will be and whether it is in our interest to grant them legal rights. It is well to remember that full legal rights for women, African-Americans, Native Americans, the mentally and physically disabled, and many other disadvantaged groups were once unthinkable, too. And yet, today few would argue against including these previously excluded groups within the realm of legal personhood.

But, one might say, these are people and belong to a special category. Nature cannot speak for itself as we humans do. To which law review author Stone replies:

It is not inevitable, nor is it wise, that natural objects should have no rights to seek redress in their own behalf. It is no answer to say that streams and forests cannot have standing because streams and forests cannot speak. Corporations cannot speak either; nor can states, estates, infants, incompetents, municipalities or universities. Lawyers speak for them, as they customarily do for the ordinary citizen with legal problems.

Now, perhaps the most important phrase in the above quotation is "in their own behalf." This explains why we might not regard it as sufficient merely to compel people by law and by custom to take care of natural entities. When natural entities do not have independent advocacy, it is all too easy to consider them merely as the instruments of humans. We call them "resources" and that means they are for our use as we please. Nature becomes merely a great vat of primordial clay from which we humans can take whatever we want and shape it to our needs without regard to the needs of any other entities.

This is the relationship of a master to a slave, Stone points out. That master is concerned about his slave as a piece of valuable property that he does not want stolen or injured by another; but the master reserves the right to injure the slave for his own purposes (through overwork, lack of food, poor medical care and, of course, involuntary servitude.)

In the United States we already have the Endangered Species Act. Lawyers speak regularly on behalf of species in court proceedings. The purpose of the act, of course, is not to protect individual organisms, but to insure the survival of an entire species. I wonder how we would be obliged to act if humans were classified as an endangered species under the law. What might we as a species be required to change to insure our own survival (or face an an angry and powerful federal judge)?

What we face instead of a judge is the rest of the natural world. In fact, scientists James Lovelock and Lynn Margulis proposed the Gaia Theory in the early 1970s. The theory re-imagines the Earth as a single biogeochemical system that is self-regulating in the way that a single organism is said to be. The organic and inorganic worlds influence one another. Geology, biology and chemistry are bound up as one field when we look, for example, at the carbonate layers of the Earth which were formed by living creatures. Life is not an afterthought on Earth; it is a major geological force on the planet.

This is not a new animism. This is not to say that rocks have the mental faculties of humans (though the opposite is sometimes said of people we don't like). But there is a flow of information and interaction which regulates key processes on the planet to keep it habitable.

Those engaged in climate change activism understand this and fear that the dawn of the Anthropocene means that the Earth will within the next several decades become increasingly hostile to the life which now inhabits it including human life.

But, the argument for legal rights for natural entities goes beyond human survival. It imagines that natural entities have worth in and of themselves and not just as materials necessary for human survival. This move has been essential for women and racial and ethnic groups who have achieved full legal rights. They have worth in and of themselves and not as mere instruments of others.

It may be profitable for a nation to lift up its oppressed peoples and include them in the mainstream of social, economic and political life. It may be good for all of us. But the worth of these oppressed peoples does not reside in their profitability, but in their status as autonomous individuals who have self-determination.

What goes unrecognized by most is that the natural entities we think are currently excluded from our legal and political lives are actually sitting in our courtrooms and legislatures across the planet. They sit quietly, implacably in their insistence that the laws of nature will not be contravened. Our understanding of such laws can be used to benefit us--to extract resources and to protect us from natural dangers--but we cannot repeal those laws for they do not arise from legislative or judicial fiat.

Slowly, haltingly, we are coming to understand this and providing representation for the entities of nature in our various institutions--representation that renders into human speech and writing the information that is running past us everyday in the environment as if it were coursing through a series of gargantuan broadband cables connecting everything on the planet.

This is why it is so disturbing to see an American administration who believes we should reverse this trend and go back to pretending that the natural entities aren't in the room. Those entities who are ignored turn to conflict to be heard. Already that conflict has taken the form of a great worldwide fever in the planet's atmosphere. It is in evidence in fisheries that have been depleted, soil that has been eroded or made too salty to sow, and water, air and land that continue to be fouled by toxic pollution.

We can easily see that these effects are due to the acts of humans. What we must now see is that they are also due to the reactions of nature. The conflict can only be resolved through dialogue, and that dialogue can only come into existence when we recognize that we are dealing with entities that have a life of their own.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, April 02, 2017

Communications breakdown: Can we even talk about our environmental and energy problems?

Conversations that seek genuine understanding by all sides ultimately require a common frame of reference. If we aren't talking about the same things, how can we understand one another?

We usually refer to this as talking past one another. Sometimes this happens because we haven't taken the time to understand what our conversation partner is trying to say. We are distracted and focused on something else. Increasingly, our public discourse--that which we all see on the airwaves, on the internet and in print--is mere polemic in service of some political or economic interest. There is no genuine attempt to explore the issues, only to advance a particular view of them--often for pay as is the case with public relations agencies and also fake think tank academics who merely parrot the positions of their funders.

We like to regard ourselves as living in an age of enlightenment. But enlightenment only occurs when we are intellectually honest. What intellectual honesty requires is the ability to entertain ideas and accept evidence that contradict our current views and to evaluate those ideas and evidence on some basis other than a financial or political interest.

The late William Catton, the sociologist and ecologist who stands as the 20th century prophet of our predicament, laid out this problem in his last book, Bottleneck: Humanity's Impending Impasse. By bottleneck Catton means a dramatic reduction in human population over the coming century due to climate change, fossil fuel depletion, soil erosion and other problems and the attendant chaos these will bring to our current governance and economic arrangements.

I am reminded of Joseph Tainter's admonition in The Collapse of Complex Societies that societies don't collapse because of resource shortages or climate change, but because of their inability to respond effectively to such developments. The cause: an elite governing class that has become insulated from the warning signs of such a collapse.

In ancient Mayan civilization sculptors were still working on monuments to their rulers as late as 909 A.D. after a century of drought. The question is: Who in their right mind would be expending resources on such a task under such dire circumstances?

Today we build ever higher temples to finance in our major cities even as major ecological catastrophes converge on our civilization. Like the Mayan rulers, ours believe our civilization is invincible. It is this myth of invincibility that makes genuine communication about vulnerabilities almost impossible because the myth has spread to practically the entire population of the planet. Even those who are struggling to get by, for whom the system has worked very poorly, even they want more than anything to get a larger share of wealth from our supposedly invincible engines of production. I do not blame them.

When the frame of reference on one side (and by far the most numerous and well-funded side) is the invincibility of modern technical society and when on the other it is that history teaches us that all civilizations destroy themselves when they reject the physical realities they face, then there can be no sensible dialogue. The frames of reference must overlap and that takes time and experience.

I am reminded that the horse became a sacred animal to the American Plains Indians only after Spanish explorers brought them to the New World and the Plains Indians realized their utility for hunting and warfare. My point is that talking to a Plains Indian prior to that time about horses would have drawn blank stares. Clearly horses did exist, but they were simply outside the experience of these native peoples.

We will only have a genuine public discussion about the vulnerabilities of our own civilization, one that will lead to commensurate action, when those vulnerabilities become glaringly obvious to a significant section of the public--when the horses, so to speak, show up in large enough numbers on the plain. In the meantime, we can only cultivate the ground for that day when we will be faced with talking not about solutions, but about damage control.

We should not, however, underestimate the value of damage control. A more benign phrase might be mitigation and management. However we style it, it is the one thing that will enable humans to get to the other side of the civilizational bottleneck which William Catton foresaw and which we will almost certainly face if we humans do not change our current trajectory.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, March 26, 2017

Taking another short break - no post this week

The aftermath of my father's death has been terribly busy and once again made it impossible to focus on writing a piece for this week. Most of what needed to be taken care of is now done, and so I fully expect to post again on Sunday, April 2.

Sunday, March 19, 2017

Taking a mournful break - no post this week

My father's death and upcoming funeral have made it impossible to focus on writing in the last week. He was an exceptional human being, and he will be sorely missed. I expect to post again on Sunday, March 26.

Sunday, March 12, 2017

Saudi Arabia and the war on shale oil that never ended

Last week when Saudi Arabia let it leak that the kingdom has no intention of leading OPEC toward another cut in production to accommodate the growing volumes of oil from American shale deposits, it was another sign that the Saudi war on shale actually never ended.

To properly understand this announcement, we need to return to last fall. Most people believed then that the cuts agreed to by OPEC under Saudi leadership marked the end of Saudi Arabia's war on shale oil in America. At the time I cautioned against such a conclusion, and said I was doubtful that there would actually be any decline in world oil production because the Saudis didn't really want a decline.

And, guess what? The OPEC cuts have yet to be fully implemented and have been offset by rising production elsewhere. And, the Saudis are now complaining that the Russians who, though not part of OPEC, agreed to cuts to support prices, are not keeping their end of the bargain. The Saudis are practicing a marvelous bit of misdirection to keep any blame away from themselves. With the Saudis, it's always necessary to look at the entire game board in order to understand their moves.

So, why are the Saudis content to allow oil prices to remain this low and possibly drift lower? I believe it's because their war on shale never ended; they mean to destroy the long-term financial viability of oil from shale deposits--and that job won't be finished until investors say, "Never again!"

Apparently, investors in American shale deposits have very short memories or they have not had enough punishment. They continue pour money into the Permian Basin located in Texas and New Mexico. The Permian is likely to be the only U.S. shale oil deposit that will see growth in oil production this year as low prices continue to take their toll on other shale plays such as the Bakken in North Dakota.

But there are only so many profitable sites in the Permian, and with the continuing rush of capital into the area, the good ones will start to run short at some point. We'll only know that's happened when the second great wave of wealth destruction in the shale fields begins as I suspect it will in the not-to-distant future.

And don't be surprised if the Saudis are content to let oil prices droop into the $20 range again just to get their point across.

As the next round of capital destruction begins, be prepared for stories about how dramatic efficiency gains in drilling operations are making it possible to bank profits in the Permian at an oil price of $40 per barrel. Then watch the same story repeat for $30 per barrel.

The last time we saw this movie there were dubious claims that oil in the higher-cost Bakken could be extracted profitably even with prices at $30 per barrel. As prices have stabilized around $50 per barrel, Bakken production has continued to decline. In part this has been because realized prices have been much lower due to lack of pipeline capacity. This has meant most Bakken oil must be shipped by rail tank car which is expensive.

Maybe this time investors will finally feel the pain from their shale investments so profoundly that even a subsequent substantial rise in the price of oil won't lure many of them back. If so, the Saudis will finally achieve their goal, and the war on shale will end.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, March 05, 2017

Our search for economic growth invites fraud

In his book The End of Normal economist James Galbraith makes a compelling case that our search for a return to the fast rate of economic growth experienced in the United States from 1945 to 1970 has led to fraud--fraud enabled by government actions that sought to "free the economy" from the shackles of "overregulation" and update the regulatory framework to meet "new challenges" such as globalization.

It turns out these sometimes well-intentioned moves signaled to the unscrupulous that Uncle Sam would be looking the other way when they duped customers, defrauded suppliers and swindled investors. In his book, Galbraith tells us how this happened.

First, we must understand that economic growth during the aforementioned period was exceptional and not the norm. Hence, the title of Galbraith's book and his main focus. During this period the economics profession embraced the idea that such growth was normal, and policymakers, politicians and most American citizens came to believe that it was.

The reasons for this exceptional growth were more the result of good luck than anything else:

  1. The United States had come through World War II almost completely unscathed with a vast industrial infrastructure built for the war, but now available for more pacific pursuits.
  2. The country was about to embark on a baby boom that would goose consumer demand for decades and power the economy forward.
  3. The United States was a resource-rich country with huge reserves of oil, natural gas, coal and uranium; large native deposits of key metals including copper, iron, and zinc; and vast fertile farmlands that turned out food and fiber enough for both America and the world.
  4. The country had a reputation for stable legal and governance arrangements which encouraged investment.
  5. The United States had unrivaled security, protected as it was by two oceans and a nuclear stalemate with the Soviet Union.
  6. The U.S. dollar became the linchpin of the world monetary system under what is known as the Bretton Woods agreement; now, everyone needed dollars to buy what America was making to revive their war-torn economies.

Everything went swimmingly--that is, for the economy--until the 1970s when oil shocks slowed economic activity and led to a puzzling combination of high inflation and high unemployment in the United States. These shocks had, in fact, become inevitable as America's own production of oil topped out and began to decline starting in 1970. America had a lot of oil, but not enough to continue to raise production continuously forever.

With the disappointing performance of the American economy in the 1970s, the Reagan administration promised better economic performance. Part of that better performance was to be delivered through deregulation which, as it turns out, was an invitation to fraud in the savings and loan industry.

When sound, profitable opportunities for ethical players abound, there is no need for chicanery. In fact, the ethical players cooperate to root out the unscrupulous ones in order to prevent widespread fraud from undermining confidence in the actions of the ethical players.

But, when there are few opportunities for the ethical participants--because the economy isn't growing very fast or growing at all--the unscrupulous find their opening. And, they open vast new fronts for profit and economic activity. Eventually, they become the dominant players, driving out the ethical participants who can't produce such extravagant returns while sticking to their principles.

Policymakers opened the way for this pattern by believing (wrongly) that the U.S. economy should be able to sustain the previously high growth rates experienced between 1945 to 1970 without the special circumstances that made that growth possible. High growth became "normalized" in the minds of policymakers. Those hunting for the reason behind slow growth often determined that government regulations were part of the problem. The troublesome regulations were then eliminated in order to unleash a wave of new investment that was supposed to return economic growth to the desired path. But the growth thus unleashed was illusory and often devastatingly fraudulent.

This is what happened due to the deregulation of the savings and loan industry in the 1980s. It is what happened in the home mortgage market in the 2000s. And, there was more than a hint of this is in the dotcom boom of the late 1990s which funneled money to many tech startups that had questionable business plans. The lack of solid business plans in the face of a surfeit of eager tech investors gave rise to crafty promoters offering an ample supply of not-so-solid business plans.

Here is how Galbraith summarizes the problem:

When resources to fuel economic growth are abundant, fraudulent activities are not generally tolerated. There are opportunities for "honest profit" and those pursuing such profits work to control the system, which means that they favor enforcement of laws against cheats and chiselers. However, when resources become scarce or expensive, opportunities for large profit for honest business are few. If the expected rate of profit--the rate that financial markets insist on as a condition for providing loans--nevertheless remains high, then fraud becomes a main channel to profitability, and fraudulent activities become part of standard practice. Fraud is a response, in short, to the failure of lenders to adjust to a decline in real possibilities.

In an era of slow growth that calls out for such an adjustment, we can only expect a continuation of fraudulent practices until the expectation for outsized profits comes down to a level consistent with actual conditions.

It is, of course, not in the interests of America's leaders (or world leaders, for that matter) to manage public expectations about growth downward. A political or corporate message based on slow or no growth is the path to electoral or professional oblivion.

It turns out that we have harvested the low-hanging fruit from the the tree of growth--electricity, the internal combustion engine, the spread of public health, the rise of major worldwide communications networks--and now we are left with marginal improvements according to Robert Gordon, who cataloged the special nature of the period from 1870 to 1970 in his book The Rise and Fall of American Growth. The cellphone, it turns out, is still a phone. (Yes, I know it is a camera now, too. But the camera is a fundamental invention that has not been superseded. It has only been improved and refined.)

It's not that we won't see profound inventions that change our lives in the future. It's just that we won't be introducing electricity to every household again. And, we won't be building a worldwide communications network for the first time, but rather refining what we have.

If someone tells you differently, you should be especially careful about buying any of the investments he or she is offering.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, February 26, 2017

The Dutch love affair with natural gas: A cautionary tale for the United States?

The story sounds familiar. For decades oil and natural gas drilling have been proceeding and creating prosperity for those involved. At some point significant earthquakes occur in areas where they were formerly very rare or nonexistent. Those quakes are linked to oil and gas drilling and production. The industry denies the link.

The quakes continue, get worse and finally get strong enough to do damage.

To those living in the United States, this reads like stories coming out of the fracking boom in states that include Oklahoma, Texas, Ohio, Kansas and Arkansas. To those living in Europe, it's the story coming out of The Netherlands, home to the Groningen Gas Field, one of the largest natural gas finds ever.

The Groningen field has been both a blessing and a curse for the Dutch. Since its discovery in 1959 the Dutch have reaped huge financial benefits from having their own secure and abundant source of natural gas. Beyond that, the country has until recently been a major exporter of natural gas to its European neighbors.

But the field has also proven to be a drag on the rest of the economy, inflicting what has been dubbed the "Dutch disease." In short, the Dutch disease refers to negative effects that a huge natural resource find can visit upon a society. These include a decline in other sectors of the economy and a strong currency which makes exports less affordable to foreign buyers. The moniker "Dutch disease" results from the fact that The Netherlands was the first place such effects were studied in detail.

What has caught the Dutch by surprise--and may someday soon catch America by surprise--is the speed with which its decades-long reliance on a large initial endowment of natural gas has turned into a liability.

First, there were the earthquakes linked to drilling and production operations in Groningen which have forced the government (part owner of the field) to scale back production to reduce the frequency and severity of those quakes. This production decline of more than 50 percent has meant a serious loss of revenue for the government which used those revenues for decades to supplement the government's budget. Government gas revenues dropped by more than half from €13 billion to around €5 billion from 2013 to 2014.

Second, as a result of the production cutbacks The Netherlands is now a net importer of natural gas, instantly losing its self-sufficiency status. Europe's gas now will likely have to come increasingly from Russia whose relations with Europe are replete with complications.

Third, the Dutch have failed to prepare for this day. Instead, they blithely made themselves deeply dependent on natural gas for their energy needs. Some 98 percent of Dutch homes use natural gas for heating and cooking. Renewable energy makes up a paltry 5.5 percent of the country's energy mix as of 2014.

Fourth, the Dutch are still obliged to honor long-term contracts which force them to deliver substantial quantities of natural gas to customers outside the country. The country is increasingly facing the strange predicament of having to import more and more natural gas to offset what it must ship abroad. This is in a country whose dominant field, Groningen, is now 80 percent depleted.

And, here is where the Dutch situation ought to be a warning to the United States. America is entering into more and more long-term contracts to export liquefied natural gas (LNG) to customers in Europe and Asia even as the country remains a net importer. There is good reason to believe that most estimates of future natural gas production in the United States are far too optimistic. Let me quote for the second time in three weeks from an independent analysis of U.S. shale gas production trends (the only class of natural gas experiencing production growth in recent years):

Shale gas production overall has declined by 4.7% since peaking in February 2016 (down 2.1 billion cubic feet per day...). All shale plays have peaked and older plays, like the Barnett and Haynesville, are down 38% and 52%, respectively.

Second, the U.S. electric utility industry has added significant natural gas-fired generating capacity in response to two trends: government regulation of greenhouse gas emissions and the low price and rising availability of natural gas. Despite the election of Donald Trump, who favors a return to coal, the low price of natural gas will probably allow the conversion to and expansion of natural gas-fired capacity to continue...until it can't. At which time we may be stuck with much higher electricity costs.

The promised natural gas deliveries will likely not be available at low prices. Production declines will result in a battle over who gets the remaining supplies, thereby hiking prices for U.S. consumers. The U.S. utility industry may rue the day it chose to make itself so heavily dependent on natural gas.

Finally, states that became addicted to money from the natural gas boom are finding the bust difficult to navigate. In comparison, the Dutch had one large boom that lasted for decades. The kind of exploration and development that is taking place in U.S. shale gas fields requires constant drilling just to maintain production at current levels. We can expect boom and bust in short spurts from here forward. That signals that the cost of exploiting the remaining shale gas resource (again, until now the only growth area in U.S. natural gas production in recent years) will almost surely stairstep higher as lower-quality deposits are tapped at greater and greater expense.

The Dutch have had a very long love affair with natural gas. But, as it turns out, a seemingly comfortable, stable relationship with natural gas can unravel just as quickly as a real love affair, leaving one dazed and asking how it all happened so fast.

Americans may not be as dependent on natural gas as the Dutch. But they have rushed into their own torrid love affair with natural gas and lost sight of the fact that affairs which start out torrid are the same ones that tend to flame out quickly, surprising everyone with their sudden demise.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, February 19, 2017

Taking a short break - no post this week

I'm taking a short break and expect to post again on Sunday, February 26.

Sunday, February 12, 2017

Does the Australian LNG export experience foreshadow soaring U.S. natural gas prices?

Two times last winter Australians living in the country's eastern region paid more than twice as much for natural gas as did Japanese customers taking delivery of liquefied natural gas (LNG) from the same region. (Australia has three separate natural gas pipeline networks which create three domestic natural gas markets, Eastern, Northern and Western.)

The price spikes had eastern natural gas users, particularly business users, hopping mad about what they perceive as foolish energy policy. That policy, they say, gives away Australian energy resources at bargain prices to foreign countries while making domestic industries that are reliant on those resources less competitive because of high energy costs. In addition, the new volatility in gas prices makes planning difficult and expansion financially risky.

The dust-up in Australia has some people thinking that the same thing could happen in the United States, something I pointed out in 2013. In the United States the Federal Energy Regulatory Commission has approved natural gas export terminals with a capacity of 17 billion cubic feet (bcf) per day. That represents 19 percent of current U.S. natural gas production. If all terminals for which applications are pending or expected are included, the number goes up to 42 bcf per day or about 47 percent of current production. Only one U.S. export facility is currently in operation in the lower 48 states. Another facility in Alaska has been exporting LNG to Asia since 1969.

It's worth noting that U.S. marketed natural gas production is down a little over 1 percent for the 12-month period ending November 2016. During the same 12-month period net imports were about 654 bcf or about 2.7 percent of total consumption. That's right. The United States remains a net importer of natural gas even as it contemplates a major expansion of LNG export capacity.

Back in Australia electricity blackouts in the state of South Australia are being blamed partly on the mothballing of a major new natural-gas-fired electric generating plant. The operator had contracted for large deliveries of natural gas at low prices to fuel the plant. But with the price of LNG exports from Australia soaring, it became so profitable to resell the gas for export that the plant was never opened. (That was before the domestic price spike. But by then the plant's gas was already committed.)

The rapid expansion of natural-gas-fired electricity generating plants in the United States leaves the country vulnerable to similar dynamics that also include higher electricity rates. Most utilities get to pass fuel price increases on to their customers. And, LNG exporters cannot withhold deliveries and sell their contracted gas back into the domestic market if prices spike. They are obliged by long-term contracts with their customers to deliver. In addition, LNG customers are typically bound by take-or-pay contracts which oblige them to take LNG deliveries or pay for them anyway. Which do you think they'll choose to do?

The U.S. natural gas industry argues that natural gas production is bound to rise and keep on rising for a long time. The U.S. Energy Information Administration (EIA) is forecasting a continuous increase in annual U.S. production through 2050 when production is supposed to reach 40 trillion cubic feet (tcf), up from just 26.5 tcf in 2016. The EIA is basing its forecast on dramatic gains in so-called shale gas production since conventional gas production continues to decline.

But the reality is already much different. As geoscientist David Hughes tells us in Shale Gas Reality Check published in December 2016:

Shale gas production overall has declined by 4.7% since peaking in February 2016 (down 2.1 billion cubic feet per day...). All shale plays have peaked and older plays, like the Barnett and Haynesville, are down 38% and 52%, respectively.

Higher prices might turn the trend around. But higher prices will also make LNG exports less attractive to world markets. A deeper reading of Shale Gas Reality Check--which provides detailed analysis of all major shale gas plays based on actual production trends, not company press releases--suggests a declining U.S. natural gas industry rather than a growing one in the years ahead.

The industry promise of large and growing supplies at low prices was a fiction from the beginning designed to get regulators to approve export facilities that would bring U.S. natural gas prices closer to world levels--and thus make the natural gas industry more profitable.

There is actually a principled argument for the industry position. But it would be popular neither with voters nor with the legislators who represent them, and the industry understood this. Here is the argument: The natural gas industry should be allowed to sell its products to the highest bidder anywhere in the world just like every other industry in America. If we are now truly in a global economy, then natural gas should become a global commodity and Americans should pay the global price.

Some governments, however, perceive that the central role of energy in the economy warrants special rules that retain domestic energy sources for domestic uses. After all, nothing gets done without energy. Along these lines the Australian government is currently getting an earful from irate natural gas business and household customers.

In theory environmentalists should be content to see fossil fuel prices including natural gas prices drift higher in the United States. That makes renewable energy more attractive to investors. But environmentalists fear that providing an outlet for America's shale gas via LNG to world markets will only make the environmental nightmare associated with fracking in shale gas fields that much worse. The industry would then be able to go after deposits that only higher world prices make viable.

In all likelihood many of the proposed LNG export projects in the United States will never be built. Glutted world LNG markets are giving investors pause. As it turns out, the U.S. natural gas industry wasn't the only one that saw opportunity in gaining access to the LNG export market.

Whether the United States will see more frequent natural gas price spikes or an overall long-term increase in domestic natural gas prices will depend partly on how investors and regulators perceive the availability of future U.S. natural gas supplies and the conditions of the LNG export market. On balance the evidence suggests that they remain too optimistic about both.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, February 05, 2017

Risk, double-edged swords and imagining the worst

A friend of mine recently said that intellectual honesty often requires imagining the worst. Of course, in the study of climate change and natural resources one needs only to read the analyses of scientists to imagine the worst.

Imagining the worst in not necessarily the same as believing the worst is inevitable or even likely. It can be merely a standard part of both scenario and emergency planning. Of course, imagining the worst can also be a double-edged sword with a sinister edge, sometimes eliciting Richard Hofstadter's paranoid style of politics.

When we imagine the worst concerning our political opponents or our enemies (sadly often placed into the same category), this is merely a reflex designed to justify our own hatreds and also a tool for broadly smearing those with whom we disagree. Clearly, this is not the same as seeking out solid evidence and using logic to construct a worst-case scenario.

In scenario planning the whole point is to consider seriously a range of possible outcomes and formulate plans for dealing with those outcomes. For example, the U.S. Energy Information Administration (EIA) reference case for world oil production (defined as crude oil and lease condensate) shows it rising from about 76 million barrels per day (mbpd) in 2012 to 99.5 mbpd in 2040. The low production case is 92 mbpd and the high production case is almost 103 mbpd.

You may feel that this range doesn't reflect more extreme scenarios, but at least the agency offers a range. Some forecasters pretend to know to the second decimal point the future of oil production and reserves decades hence. It's hard to put this down to anything but hubris.

Compare these forecasts to a forecast based on much sounder data, this one made by an EIA researcher in 2009 about how much oil we would have to find and deliver to meet rather extravagant future demand expectations:

The researcher demonstrated that we will have to find more than five new Saudi Arabias by the early 2030s (or 2040s if demand growth slows somewhat as the EIA anticipates) if we are going to fill the gap between production from existing fields and expected future demand (in this case for so-called total liquids which include natural gas plant liquids and other non-oil items). He based this on the estimated average production decline rate of 4 percent per year for existing fields, a fairly conservative number given that other estimates range as high as 6 to 9 percent. We know with a fair degree of accuracy what existing fields will on average be producing decades hence because we have a long series of actual field data.

This graph looks more like imagining the worst than the other forecasts. Without being hyperbolic, this one graph suggests that our confidence that future oil production will match our expectations--and that therefore we will NOT need to plan for a disappointing outcome--deserves considerable scrutiny.

What imagining the worst can do is allow us to discern the risks in our lives and our futures, collective and individual. This does not have to be a glum exercise. We can, as the saying goes, prepare for the worst and hope for the best. We can prepare responses to any anticipated challenges as a positive way forward.

The naturally optimistic disposition of humans tends to make them critical of those who point out possible catastrophic downsides, especially when those observations conflict with business-as-usual. But it is the ability to hold in one's mind both optimistic promises and the possibility of catastrophic failures that makes for intellectual honesty.

It is intellectually honest to acknowledge that we live in a tragic universe. Things often don't turn out for the best. The future of humankind is not assured either by technology or by religious prophecy (and sometimes it is hard to tell them apart). But, we can learn to live with uncertainty and risk without living in fear.

This piece on the so-called high-reliability organization tells us that "[t]o avoid failure we must look for it and be sensitive to early signs of failure." That is just prudence.

But we live in an age where unchecked technological optimism is treated as prudence, and intellectual honesty is treated with disdain. Questioning is not the same as gainsaying. But the questions are frequently batted away with protestations that "you just don't understand."

I am reminded of the film Melancholia in which the severely depressed character turns out to be the sane one in the face of global catastrophe. You don't have to be depressed to begin questioning the path we are on. But if depression comes from imagining the worst, then you have come by it honestly.

It will be hard in the years ahead to be intellectually honest. Like virtue that honesty will have to be its own reward. If you are intellectually honest, you may be made to feel like the narrator of Thomas Hardy's poem In Tenebris II who says: "I think I am one born out of due time, who has no calling here." But you can more easily remain true to yourself when you understand as Hardy does that "if way to the Better there be, it exacts a full look at the Worst."

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, January 29, 2017

Trump's wall and the imaginary lines we draw

There was quick reaction to President Donald Trump's announcement last week that he plans to follow through on his campaign pledge to build a wall on the U.S.-Mexican border. Conservative and liberal commentators alike were channeling their inner Robert Frost, referencing his poem "Mending Walls" that starts "Something there is that doesn't love a wall" and contains the well-known proverb, "Good fences make good neighbors."

It is worth remembering that this border is an imaginary line we draw ourselves. It's true that the Rio Grande separates Texas and Mexico. But much of the rest of the border is dirt. The only way to see the border is to draw a line.

Animals don't really respect borders the way we'd like them to. The jaguars, gray wolves and ocelots which depend on ranges that cross the U.S.-Mexican border don't see it. Humans can detect the human signs of a border. But they tend to think about how to get across it rather than how to stay on one side. Even East Berliners in the days of the famously lethal Berlin Wall found ways to get across to West Berlin. They went up, around, under and through it again and again.

I am reminded of my days in South Texas when the federal government decided enough was enough and erected a floating border of sorts around Florida to stop rising seaborne drug trafficking. As a result much of that drug trafficking merely shifted westward, some of it to the Texas coast.

The French imagined that the Maginot Line, built to halt a German invasion, did not have to extend to the English Channel. When the Second World War broke out, the Germans felt no obligation to march directly into French machine guns and artillery along the fortified line. Instead, they invaded Belgium and then turned south toward France. Who could have guess it? (Actually, a lot of people did.)

Humans are making a mockery of the current border barrier daily by simply walking or driving through regular border crossings. It's hard to see how that will change with a wall. The wall will have to allow for current bridges and land crossings. And, it will have to allow rivers on the American side to flow into the Rio Grande or out of and into Mexico where it touches the Colorado River basin.

As for the current barrier, people can just climb over it or through it where there are holes made by wire cutters.

Yes, yes, I know. This new wall will be concrete, and it will be 55 feet tall. My source for the material and height specifications is Donald Trump. I'm sure in Trumpian language the wall will be fabulous and the best wall ever built by the smartest engineers. It will be "beautiful," he says.

We have no actual plans or specifications for such a wall from the Trump administration yet. But, a fanciful attempt by a Mexican architectural firm imagined a pink wall (so it would be beautiful) stretching from the Pacific Ocean to the Gulf of Mexico. The architects estimated it would take 16 years to complete in part because the mountainous terrain along some of the border will be difficult to access and build on. Perhaps adding to the difficulty for this design will be the shopping malls and detention centers built right into the wall.

Still, unless the wall is attended to by guards all along its length, people will just find ways over it or possibly under it. Ladders are pretty handy. Of course, wire cutters may also be needed. Where there is water, boats are a good choice and can be navigated up the tributaries of the Rio Grande well beyond the wall. Those crossing the border have a lot of experience with all of these.

It's hard to imagine that at one time the United States had a formal agreement with Mexico called the Bracero Program to import Mexican laborers to overcome a labor shortage, primarily for seasonal agricultural work during World War II. The program lasted until 1965 when new immigration legislation ended it. The need for Mexican seasonal labor, however, didn't end which is why much of the movement of 500,000 Mexican workers in and out of the United States each year continued as that movement went from being legally sanctioned and administered to being illegal.

Given all the goods and people crossing the Mexican border every day, the hoopla over the proposed wall must actually be about something other than keeping goods and people on the Mexican side out. It's more about the lines we construct in our minds between us and others.

Denizens of the U.S. coastal regions are used to the cacophony of voices and subcultures that populate their daily lives. There is no convenient line that can be drawn to separate cultures from one another in those places. In so-called flyover country, where Trump was hugely popular, recent immigrants are more sparse. It is easier to draw a line between "us" and "them." By this I do not mean that people living in the Plains states or the Midwest are not charitable. One can find plenty of stories about kindness to newcomers from foreign lands.

But the newcomers do not simply melt into a polyglot culture in those places. They are aliens and remain so for a very long time after arrival.

The wall--whether it is ever built or not--signifies a desire to reduce the number of newcomers and to preserve a way of life that is threatened economically and culturally by the globalism embraced by the country's bi-coastal elites. Stop the invasion of newcomers and you will stop the forces bearing down on a threatened way of life in flyover country; so goes the visceral logic.

It's doubtful that such a wall can do either. But a promise to build one signifies sympathy for a certain fearful and nostalgic outlook and an opposition to a globalism that has devastated the economies of small towns and rural communities--by shipping manufacturing jobs overseas and by favoring the consolidation of agricultural in a way that is driving more and more people off the land.

Sometimes when we put up barriers to others, it can actually be to draw them nearer in steps. Lovers love the chase. Businesspeople stake out negotiating positions, but do so only as part of a game to come to an agreement. Lines are drawn to be crossed. That's how new friends and new opportunities enter our lives.

Sometimes we put up barriers to protect ourselves from others who might harm us physically or who might merely reject us or shame us publicly for sport. Sometimes, we put up barriers to those who are culturally alien, too, not because we necessarily dislike them, but oftentimes because we are not certain of the stability of our own cultural lives.

The maelstrom of change which is now sweeping over American culture (and much of the world) can overwhelm those without secure anchorage. We are beyond the relative stability that prevailed prior to the 2008 financial crisis and into an in-between period of rapidly changing technological, social, economic and environmental forces, all of which demand new arrangements.

The globalism that promised to put to rest old divisions has instead reawakened them. A retreat behind a wall won't reconcile those divisions. But neither will a rapid advance toward a socially untenable and ecologically disastrous globalism based on a neoliberal economic ideology that has led to financial stagnation and decline among so many low- and middle-income families.

Economics thought that it could replace politics. Politics has come back to reassert itself and challenge what could not be publicly challenged before. The repressed always returns, often in ways which surprise and distress us.

We now have no choice. We are obliged to cross lines into uncharted territory to discover a new politics and a new economics. There will be many barriers and detours, and it won't be an easy journey.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, January 22, 2017

Which species are we sure we can survive without?

As a new administration takes over in Washington, both houses of Congress and the presidency will be in the hands of one party. As it turns out, that party, the Republicans, want to curtail the protections of the Endangered Species Act (ESA). Many Republicans complain that the act hinders ranching, logging, oil and gas exploration and water projects.

The key question they are not asking is this: Which species are we sure we can survive without? More on that later.

The act has in practice been used "for control of the land," says one congressman, and not for the rehabilitation of species. His statement stems from a misunderstanding about what it takes to revive an endangered species, namely habitat. That means the land, air, water and other species (plant and/or animal) which any particular species depends on in order to survive.

First, it's important to understand how humans and, in fact, all organisms obtain the resources they need. There are basically two strategies, takeover and drawdown. Takeover simply refers to taking over the habitat of other species to extract resources.

Humans routinely take over land with diverse plant and animal species and use it to grow crops of our choosing, tearing out trees and boulders and turning over the soil to kill the remaining plant life. We keep away nutrient-leeching weeds by pulling them out, plowing them under or killing them with chemicals. We also kill and repel insects that can eat part of what we grow.

Drawdown refers to the drawdown of finite resources such as fossil fuels, metal ores and other mineral deposits such as phosphates for fertilizer. Usable deposits of these are not regenerated by the Earth on any timescale that matters to humans.

Ranchers who take over rangeland for grazing livestock don't like it when wolves protected by the ESA decide to assert their desire to "take over" livestock and eat them. Ranchers are in peril if they try to kill protected wolves even to defend their investment. The conflict isn't over whether the livestock will die. It's about who gets to kill and eat the livestock and when.

We humans, it turns out, are in competition with other predators for food. What the opponents of the ESA are complaining about is that we are fighting these competing predators with both arms tied behind our backs. Why be concerned about what other competing species need? The priority should be what we humans need, right?

Now we arrive at the crux of the matter. Are we humans merely in a war of all against all in the biosphere? Don't all species compete with one another for advantage in the struggle for survival?

The answer to this question is yes and no. Species both compete and cooperate to survive. Dogs have evolved to cooperate with humans. Cooperation has been kind to the household dog population which now numbers close to 78 million in the United States alone.

Compare the ancient relative of the dog, the wolf. As a competitor, the wolf is definitely losing the competition with dogs (and humans). Only about 5,600 remain in the lower 48 states. A far less developed Alaska may have up to 11,000 wolves. But both numbers are minuscule compared to dog populations. Seeking to outcompete other species isn't always the most successful survival strategy (though I wouldn't count the adaptive strategies of dogs and wolves as consciously chosen.)

We have another very recent example of a species the population of which dropped precipitously as a result of unintended consequences of human action. The widespread adoption of the herbicide glyphosate is thought to be responsible for wiping out much of the milkweed in North America, the only plant that monarch butterfly larvae feed on. East of the Rocky Mountains, monarch populations have declined up to 90 percent. We humans didn't know that this would be one of the results of the widespread use of glyphosate. We found out the hard way.

Which brings us to the question of which species we are sure we can survive without. The answer so far is the ones that have already gone extinct while we humans have been around on the planet. We are now in what many scientists consider the Sixth Great Extinction. The main culprit is human activity and our sheer numbers.

As we are learning each day more and more, human survival relies on complex interdependencies with other microorganisms in our own bodies. We are also dependent on the microbiota of the soil that impart the fertility necessary to grow crops. In both areas we are learning just how much we do NOT know about these microorganisms and their interactions with us and with the soil.

If you consider that the broader world with which we interact has millions of species of which we are not aware, it becomes apparent that the Sixth Great Extinction is a rather clumsy and thoughtless way to play Russian roulette with human existence. We could easily cause an organism essential to our survival to go extinct without even realizing it.

The surprising decline of phytoplankton in the oceans comes to mind. The cause is likely rising ocean temperatures due to climate change. Phytoplankton are microscopic plants that form the base of the ocean food chain and produce two-thirds of the world's oxygen. Recent research suggests a rise of 6 degrees C in ocean temperatures "could stop oxygen production by phytoplankton by disrupting the process of photosynthesis." How many other species might pose this kind of outsized danger to our existence if they were to decline, disappear or cease to function in a normal way?

You will now have an answer when a congressman, businessperson or fellow citizen asks, "Why be concerned about what other competing species need? The priority should be what we humans need, right?" Perhaps. But if one of those needs is to prevent our own extinction by keeping other organisms alive, then we'll have to define "need" differently than we do now.

I am under no illusion that the ESA in its current form is somehow the critical firewall to forestalling rapid biodiversity loss. There are too many human activities outside U.S. control and outside the jurisdiction of the act inside the United States that are responsible for the vast biodiversity loss we are experiencing. As a result I have what I believe is a not unreasonable fear that our experiment in species management called the Sixth Great Extinction could lead to the extinction of the one species we think we are saving by killing off so many others.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, January 15, 2017

Neoliberals know the price of everything and the value of nothing

My father likes to say that some people know the price of everything and the value of nothing. The same could be said of the neoliberals of the world, who--in case you missed my previous piece--are now transcendent in most policy circles across the world.

To review, the neoliberal agenda is one of deregulation, unfettered trade, fiscal austerity (with the attendant reduction in social programs), privatization and tax reduction. Fundamental to the neoliberal ideology is that government regulation and planning of economic activity are inherently flawed and cannot bring about the desired ends of efficiency, prosperity and social harmony.

Instead, price is the great and sufficient transmitter of information across the economy and across society at large. Price is the best barometer for all decisions. Hence, the emphasis on privatizing almost everything in society including education and health care.

Neoliberals believe that voting with your money is at least, if not more important, than voting in elections in a free society. The freer the market, the more choices consumers will have, and the more competitive the market, the better the quality will be.

There are several problems, of course, with the price mechanism. First, it only takes into account costs which are directly borne by the provider of a product or service. So-called externalities such as pollution and climate change are not tallied in the price. In order for those costs to be included, say, by the imposition of a carbon tax, the government would have to intervene, something not consistent with neoliberal ideas.

Second, such a monomaniacal focus on price alone pre-empts a broader view of social goals, reducing them merely to price signals. But not every social good can be reduced to a price signal in a nominally "free" market.

Here we have a case of knowing the price of everything and the value of nothing. The neoliberal who ignores climate change sacrifices a habitable climate for his or her children and grandchildren in favor of cheap prices for goods and services now. This is the supposed "economic rationality" which the neoliberal espouses because he or she does not seem to know the VALUE of a habitable climate. What the neoliberals would like you to believe is that a neoliberal world is inevitable--which translates into a suicide-by-climate-change pact among peoples.

The theorists, policymakers, propagandists and business leaders also tell us that "globalization"--another vague, but central tenet--is inevitable, that it is a product of technological change, that it is akin to a natural law which we cannot violate without consequences.

In fact, it is nothing more than a conscious set of policies set out in worldwide trade agreements administered in part by the World Trade Organization--policies that favor the wealthy over everyone else and which break down national barriers (read: eliminate protections against the destruction of local industries and agriculture) that hinder the free flow of capital and goods (and, of course, the search for profits). As it turns out, French sociologist Pierre Bourdieu tells us in his book of essays Sociology is a Martial Art, "the global market is a political creation."

It is no accident that neoliberals advocate neither for the globalization of a minimum wage nor for the globalization of free education nor for the globalization of universal health care. Why is that? Well, these areas of social uplift are considered merely to be cost centers which reduce competitiveness. But if these were available to everyone, then no country or industry would be at a disadvantage. So, it becomes obvious that the neoliberal agenda is to UNDERMINE all these social goods in order to lower costs (that is, lower wages, benefits, and taxes) and to increase profits by pitting one country against another in a race to the bottom of the social ladder.

Moreover, creating anxiety and uncertainty among employees, even ones at the highest level, is actually the point. Such anxiety and uncertainty hinders them from taking risks in participating fully in society as political actors.

The same logic would apply to environmental, health and safety regulations designed to protect workers, consumers and the population at large. If you want your country to be competitive, it is best to keep such regulations to a minimum.

Bourdieu points out that neoliberal policymakers are obsessed with the "confidence of the markets." Why, he asks, are they not equally concerned about the "confidence of the people"? Recent developments such as the decision by British voters to exit the European Union and the election of Donald Trump to the presidency in the United States suggest that the confidence of the people in the neoliberal globalist experiment is becoming shaky.

Bourdieu adds that instead of a universal minimum wage, we get what economist Frédéric Lordon calls the "minimum guaranteed shareholder income."

Any demand that education, health care, pensions and other benefits for workers be maintained, let alone expanded, is now styled as old-fashioned and backward-looking. These benefits must be "reformed" (read: destroyed). In fact, basic protections for the middle and lower classes are some of the most important human achievements ever, Bourdieu explains. Rolling them back isn't progress, it is anti-progress.

The neoliberal agenda styles itself as a revolution--the Reagan revolution, the Thatcher revolution--and anyone who opposes it is labeled parochial, retrograde and opposed to the march of progress. What these supposed "revolutions" really turn out to be are the latest versions of a very old system of wildcat crony capitalism supported by a combination of corporate and state power in which the corporations tell the state how to govern.

The neoliberal agenda undermines the hard-won gains of average people whose autonomy and independence--far from being undermined by social insurance programs--are predicated on a degree of financial security and access to health care and education which allow meaningful participation in democratic life. This participation would be what philosopher Isaiah Berlin refers to as "positive freedom," that is, the ability to take action based on our resources and previously developed capabilities.

The neoliberal agenda also threatens to undo any progress we've made so far in addressing the myriad existential environmental challenges that threaten to undo civilization as we know it.

We would not presume to understand the Sun by examining merely one wavelength of light coming from it. We would not presume to understand the forest by examining one tree. Nor would we presume to know all of humanity and human society by examining one individual. But somehow neoliberals believe that we can understand and govern society by focusing on price alone.

What gets sacrificed in such a system is social stability and harmony and a habitable biosphere inside which we can all live and prosper. This is what is now at stake when we know the price of everything and the value of nothing.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

Sunday, January 08, 2017

To confront power, one must first name it: Neoliberalism and the sustainability crisis

Recently, Wisconsin Gov. Scott Walker ordered references to human-caused climate change be deleted from the state Deparment of Natural Resources website. Scientific findings concerning the natural world have become an embarrassment for the neoliberal world view. The answer in this case seems to be to delete them.

But what is the neoliberal world view and why is it important to understand? Paraphrasing theologian Walter Wink British writer George Monbiot explains that in order to confront power, one must first name it. The power Monbiot has in mind is the power of those enacting the neoliberal agenda. He explained in a talk last year that this ideology is embraced by leaders of both the political right and left throughout much of the world.

More disturbing is that few people are aware of this fact, and fewer still can define what neoliberalism is. It's important to understand that this ideology animates much of the governing class on the planet. It's important because this ideology almost completely opposes doing anything serious about climate change or any of the other environmental and social ills which afflict us.

First, neoliberalism should not be confused with modern-day liberalism which is generally associated with tolerant social policies and governmental intervention in and regulation of the economy. To the contrary, neoliberalism harkens back to 19th century classical liberalism. Neoliberals champion a return to laissez-faire economics by means of the privatization of public services and property, fiscal austerity, deregulation and, of course, free trade.

Neoliberalism was first enunciated in the late 1930s as a response to fascism and communism. Only later did neoliberal ideas find their full expression in the presidency of Ronald Reagan and the government of Britain's Margaret Thatcher. For obvious reasons neoliberal ideas have been championed and lavishly supported by wealthy corporate interests.

These ideas were also highly influential in the presidency of Bill Clinton and the government of Tony Blair. Thus, both left and right have adopted many of the tenets of neoliberalism. Both Clinton and Blair mixed the redistributive policies of the left with the economic ideas of neoliberalism. Certainly not every politician left and right embraces the neoliberal ideology; but it is now largely an article faith on both the left and the right that markets are the preferred solution to any problem.

One modern example is that addressing problems with public schools requires competition from publicly funded private schools often called charter schools. Other examples include privatizing public lands and minerals, public recreation facilities, and public services such as water, public parking and even prisons. Of course, not all on the left have embraced these policies. But the left has largely accepted corporate dominance of government policy which has led to a less than robust attempt to roll back such measures or to regulate industry.

Of course, the marketplace alone cannot address climate change, soil depletion, fisheries decline, deforestation, toxic waste disposal, and pollution in general. And so, in order for the neoliberal program to succeed it must prevent ideas about limits in nature from taking root. In general it must pretend that the problems mentioned above either do not exist or are a subject to ready technical fixes.

Scott Walker may be an egregious example on the right. But politicians on the left should not be let off lightly. The insistence, for instance, that the deployment of renewable energy will solve the climate change problem is disingenuous at best. It should be obvious to those who understand climate science that only drastic reductions in overall energy use and major changes in our infrastructure and in our daily routines can hope to bring down greenhouse gas emissions sufficiently to avoid catastrophic climate outcomes. And again, the marketplace alone isn't going to do these things for us.

This message is inconvenient for both right and left in that it suggests that we must dispense with the growth economy and structure our economic lives based on other principles, say, sustainability above all and solidarity through shared sacrifice. These principles have the possibility to be inspiring, but they simply do not fit into the neoliberal vision of perpetual growth and concentration of wealth in the hands of the few.

The first step, the very first step, however, is to know that much of the world's political elite subscribes to the neoliberal vision whether in its most austere trappings or in a softer form that retains some of the social safety net.

The irony is that though neoliberalism began as a response to fascism and communism--to the authoritarian concentration of political and corporate power in the state--neoliberalism has now morphed into an ideology that accepts corporate control of government policy, policy that is increasingly authoritarian in its economic and security (surveillance) apparatuses.

It is important to understand that neoliberalism as originally conceived and now practiced is hostile to social democracy. Most people recognize that many European states are social democracies and that Canada and Australia also qualify. But fewer acknowledge that the United States is also a social democracy as evidenced by its old-age pension and health care programs known as Social Security and Medicare, respectively. In addition, there is Medicaid, a health insurance program for the poor, and subsidized health care for many others under the Affordable Care Act.

Unemployment benefits and the Earned Income Tax Credit are yet other elements of America's social democracy as are subsidized housing for low-income households and subsidized home mortgages for special groups such as veterans. Americans often hate to think of their country as a social democracy. But they must now come to understand that it is if they wish to oppose the neoliberal agenda which aims to end the programs mentioned above and many others.

Monbiot is on to something when he says we must name the power we are up against. If you care about sustainability, if you care about social stability, if you care about the poor, the power you are up against is the neoliberal ideology as expressed on both the right and the left. If you don't understand that, then you will end up shadow boxing against a shadowy and ill-defined opponent.

P.S. I encourage you to watch the entire talk by Monbiot which is perhaps the clearest explanation I've seen of the neoliberal agenda.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He has been a regular contributor to the Energy Voices section of The Christian Science Monitor and is author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.