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Life After The Collapse, Part 1 of 2

Survival Manual/2. Social Issues/Life After the Collapse, Part 1 0f 2)
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Part I.  Life After the Collapse (a sample from the e-book)

Life After The Collapse © 2009, by James M. Dakin
Click here to order the eBook version: http://www.lulu.com/shop/james-dakin/life-after-the-collapse/ebook/product-4419799.html
Click here to order the Paper book version: http://www.lulu.com/shop/james-dakin/life-after-the-collapse/paperback/product-11179055.html

A.  Introduction
What will life be like after a collapse? This topic has been addressed by scores of fictional works, both the written novel and in movies. Many more short stories dwelt with various aspects of the topic. This also might be thought of as a work of fiction, because it is just like all the others, a WAG (wild ass guess). The only reason I think I might even have something remotely valid to contribute is I focus mainly on life after the Age Of Oil ends, and my guess is it ends badly. I could be totally wrong. I really hope so.
As badly as our current system is, the majority of us are either exploited poor or wage slaves encumbered with a pair of golden handcuffs, it still beats living a barbaric existence of dog eat dog, hands down. But I don’t think I am wrong. I’ve spent a great deal of my time, my effort and even my savings both studying and preparing for just such an occurrence to rudely alter my life. I don’t delude myself thinking that just because I’ve done this that I will be right. I am merely gambling. Just as I believe those that don’t are also entering their wager in this great game.
It is all a game, because none of us can know for sure. But only the blind or the blindly optimistic don’t plan for it one way or another. If you think things will continue as normal (at this point, a multi-generational slow decline) you invest your time and money in a college education, an automobile and a mortgage. If you think things will end badly you strive to insulate yourself somewhat by preparing for collapse. Obviously, you aren’t reading this as a part of your higher learning coursework.

I hope this humble work is more detailed and comprehensive than others of its kind. I hope I give you much more to think about than what end of the world fiction has. Fiction is a great vehicle, in that we think visually. Fiction plays into that medium. But I’ve yet to become proficient in fiction, so this booklet is what I offer. I’m going to cover the collapse in a quick overview. Not because I’m trying to fluff up this work. If I wanted to do that I would cover the multitude of reasons why collapse could occur. The end of oil isn’t the only possibility. No, I want to go through the collapse period because most likely this is going to effect you. I wish I could live on a remote mountaintop, enough supplies to divorce myself from society secured away. I wish I could avoid the coming messy business of society self destructing. I’m not that lucky and neither are you. So I won’t completely ignore what is likely to happen. But I promise not to spend too much time there. I have a burning desire to know what things will look like in our brave new world. As I imagine you do. By trying to spell it out I help myself as well as you. It won’t be perfect. It is just my best guess. I do know it won’t be pretty.
This is not a book destined to sell a lot of copies. I don’t include the required happy ending. Most authors seem to think they need to devote half the pages to giving you a glimmer of hope. A course of action to stop the insanity. Perhaps thirty years ago whining to your Senator produced change (or perhaps that change was for the worse, such as squandering our last giant oil fields on business as usual ). Today our Empire is on course to crash and burn. There is no going back since the vested powers won’t change. We are as the Roman Senators, working the last of the land for the last of the wealth, regardless of loss of soil fertility.

Why write this at all? Even writing short booklets is a lot of work. My financial gains will be minimal. The reading might well be interrupted by grid failure, as this will most likely never see past the electronic version. As I said, laying this out in semi-coherent thought helps me myself visualize what lies ahead. And, I like to think I am also helping those that want to think rationally. Those that don’t need a sugar-coating with their message. Perhaps seeing clearer will increase the odds of survival. That’s as happy an ending as it gets.

B.  Why a collapse?
Why am I convinced a collapse will occur? Why won’t we just see a gradual decline of our fortunes, as has usually occurred throughout history? After all, the average span of a historic collapse has been hundreds of years. Rome took 300 years to wind its way down. The Mayans saw 150 to 200 years from glory to jungle overgrown pyramids. My short answer is energy. Think back to the rapid advances we’ve seen since coal was first used, then oil. All these dizzying economic and technological advances were against the backdrop of an ever-growing pool of energy. Today, the entire economic foundations we enjoy are oil based. There are no more animal powered farms. No more agriculturally advanced armies. No more solar-powered industry. Not in any dominate form. That is only at the margins of society. You don’t revert suddenly to the forms of social and economic activity that sustained you one hundred years ago. All that activity rests on a slow laboriously constructed infrastructure. It takes many lifetimes of blood, sweat and tears to build anything the next generation can advance from. When you totally replace that infrastructure, you can’t magically go back to that place and time again. And we’ve replaced it all with petroleum energy.

We don’t even own the means of production anymore. Our industry is now overseas, mainly in China. What is left is all high technology and oil dependant. It’s not like we have the factories to start producing animal powered farm implements. Or the knowledge to do so even if the factory was there. Or the credit and financing to do so if we could. Hundreds of years previously, at least in some cultures, those illiterate peasant knew how to farm the land and built all their tools from what nature provided. Today, something as simple as building a bow and some arrows is a lost art. It is a simple concept, and those with the time can relearn the art. But without new training and the time to do it, you can’t suddenly master that task when your center fire rifle uses its last round. Now multiply that simple trouble by several orders of magnitude. Who knows how to convert a diesel train back to a wood fired boiler? Who can feed more than themselves when commercial fertilizers are no longer produced from natural gas? Who gets food from that hypothetical farm using that hypothetical train? I’m sure in hobby form all the lost arts of bygone eras are mastered and practiced today. But the numbers are minuscule. And who’s to say they won’t be casualties during the coming die-off? Or that they won’t live an impossible distance away?

Things aren’t so simple that we can revert to an economy based on less or no oil. Every activity in an economy is dependent on an infrastructure. Without the underlying support system, you can’t do anything. You need an industry, an educational system, a system of law and order, a transportation system, a system of payment and credit. Look at most of Africa today. They have vast treasures of natural resources in the ground. Yet, a corrupt system of rulers, a lack of a justice system, lack of a sound currency all keep those resources locked away. No one will invest and work without a guarantee that their efforts will not be subject to theft. Others countries all have an infrastructure where the opposite occurs. Investment is encouraged and rewarded. Look at oil. It doesn’t just appear at your gas station. There is a vast system that brings it from the ground to a distillery to you. It took a lot of time, effort and investment to put that system into place. It didn’t happen overnight, but over generations (with a lot of war and other calamities interrupting the process). The same must happen in reverse. In order to put a system into place that allows another system of energy or economic activity to happen, time and effort must be invested to build that system. The infrastructure of yesteryear is no longer in place. It was replaced and dismantled. Without a sound system to rebuild it, you end up with only the current dysfunctional system until the end.

In the 1970’s, we were rudely awoken to the need to replace our current reliance on petroleum. No widespread system for an alternate source of energy was introduced. Rather, conservation was used. We learned to be more efficient with less energy. But we didn’t replace petroleum. Lucky for us at the time, we went back to a glut of oil from Alaska and the North Sea, as well as replacing our currency backing with Saudi Arabian oil instead of gold. That saved us. But now, all those sources of oil are pretty much used up. Britain has gone from an energy exporter back to an importer, Alaskan crude is down significantly and is staying there and the Saudi fields are in permanent decline. And there will be no large fields to replace them. There hasn’t been a major oil field discovered for almost fifty years, and not for lack of effort. Coal will not last long if used to replace oil, nuclear fuel is not infinite, all hydro sources are already tapped. Ethanol seems to be a net energy loser, as well as doubling our food prices by using edible corn. Tar sands are also a net energy loser. We had nowhere to turn thirty years ago, and no where today. Petroleum was the only answer. Because it provides so much energy in such a compact space, no other energy source could compete. All others fell by the side. We have no other wide-spread source of energy available. And there is no incentive to provide one. All powerful and rich entities reliant on oil have vested interests in keeping things the way they are. They will go down with the oil powered ship.

Civilizations decline with the economic and energy system in place that brought them to power. There might be a few exceptions over time such as Japan. But they are the exception to the rule. Most civilizations follow a similar road. They do something right, that at the time brings them to power. Those in charge got rich following that path. They won’t give up that source of wealth. Usually as the system starts to decline, centralization keeps things running by bringing efficiencies of scale. In time, between the powers that be gripping their wealth and the lack of resources to keep the existing structure maintained or to devolve back to a decentralized form of production (even assuming the rulers would allow that), they collapse. In the end, ninety some odd percent of the population is dead or immigrated and the area is left fallow to replenish itself (in solar-powered civilizations, soil fertility is used up and produces collapse by hunger- a fate we will only avoid as long as oil fertilizes the soil we’ve used up). When our oil runs out, we all die. The soil stops producing food. We are no different from ancient civilizations other than we were able to grow much bigger and postpone collapse longer because of our one time use of petroleum.

      And we don’t need to get to the point where we run out of oil. All that is necessary is that we run out of enough. Oil production follows a bell curve. Rapid increase, a slowing to a plateau, then a drastic decline. Oil fields, oil regions, or global oil all follow this pattern. Not only is that bad enough, where we have nothing to take the place of petroleum, but here in the US it is even worse. We have built our entire system on not just oil but cheap and abundant oil. Where most other nations have never had the luxury of their own supplies, we have been cursed with an over abundance. We were blessed with one of the worlds largest supplies of petroleum, to the extent that we were the global leading exporter of oil until after the second world war. That allowed our economy to explode. But as oil reaches its global peak (the top of the plateau was reached in 2005) our dependence on cheap and abundant petroleum turns into a curse. Our economy, even our political system in the form of a generous welfare state to placate the masses, is based on lots of oil at essentially free prices. Nuclear power never reached its promise of “too cheap to meter”, but oil was always essentially at that point. That concentrated energy source was the equivalent of dozens, hundreds or even thousands of man hours of labor in every unit. And most of our existence has been dedicated towards making that labor as cheap as possible. Gold, a mineral so scarce that all of it ever mined could fit in a small building, buys dozens or scores of barrels of oil which is a non renewable resource. We invade countries to keep oil cheap. Political fortunes turn on the price. We burden our grandchildren with unplayable debt to devote military and intelligence resources to keeping the price low. All told, the sweat and treasure put towards stealing the global oil output is extremely high. That is the hidden cost. But the up front cost is kept low to keep the economy running. When oil reached a reasonable cost of $150 a barrel in the summer of 2008, our economy started to tumble. I say reasonable due to the limits of global daily output being reached and the inflation of the dollar. And the economy would have started to crumble sooner or later due to the massive over subscription to the derivatives market. But the timing is interesting none the less. We absolutely must have cheap, abundant oil for our economy to survive.

C.  PODA  (Post Oil Dark Ages)
PODA is my whimsical and witty title for the coming collapse and its aftermath. Post Oil Dark Ages. In a few generations when our grandchildren are scratching fleas under their animal skins while living in the basements of crumbling skyscrapers, there will still be oil in the ground. Granted, it will be that which was uneconomical to pump out. All oil is not created equal. The stuff close to the surface and without a lot of additional material costly to distill out is what we have mostly been living on. Not that which is two miles under the ocean and hard to get out. It all goes back to cheap and abundant. So we won’t actually run out of petroleum or other carbon fuels. But the consequences will be equal to running out. When the cheap stuff runs out, or it takes as much energy to pump the oil left as that oil yields, it is game over. Things start to fall apart. Crops don’t get planted or harvested, or that food doesn’t get shipped, or both. Essential trade goods don’t make it to our shores. The Age Of Oil ends, the Age Of Scarcity begins. When the military starts taking its dwindling share to take the last of the oil, and that leaves less than enough for food or transport or heat, things start going to hell. It will be a bit of a process, not everything stopping at once. But here is something important to keep in mind. It might take a civilization two centuries to fall into ruin, but that is everything averaged out. In the meantime, even from the first, individuals are adversely affected. When it takes ten years for employment to fall in half, you could be one of the first ones with a pink slip. When it takes twenty years for the death rate to double, you could be one of the first corpses. Averages look good on paper. In person they are a lot more deadly. This is how you need to look at the oil running out, depopulation, the economy falling and other aspects of society unraveling. It might take until your children’s old age for the last of the Petroleum Age to end, but you will be hurt much sooner than that.

      Some theories point to the end of the 1970’s as the start of the end. That is when the per capita amount of energy available started to decline. We don’t see that, being sheltered here in America. But plenty of the world’s population suffers while we fiddle in an orgy of gluttony. It is that average number. We do great, others live on almost no oil, on average the world economy looks good if not perfect. Looks can be deceiving. We are just masking reality. We will eventually see those low numbers. If we survive the unraveling. We will reach the point of less oil. I focus mainly on oil. There will of course be other factors. The credit crisis that started in the fall of 2007 and started to be felt a year later. That is sure to be a lot worse by the time you read this. The natural tendency of governments to hyper-inflate the currency when there is no other way to pay the bills. Our long vanished national grain stockpile and the idiocy of just-in-time inventories (great for saving money short term, suicide come any supply disruptions). Our declining soil fertility due to artificial fertilizers made from natural gas substituting for proper nutrient management. Over population encouraged by corporations as a downward force on real wages. All these things make it worse. But they are not the primary cause of our civilization collapsing. Energy is fundamental to life and an economy. The oil has already started to decline globally. We are making up some of the shortfall with less than ideal substitutions that are big picture energy net losers, such as ethanol and shale oil. Stay tuned. At first it will be easy. Less driving for the holidays. Turn the thermostat down, add insulation. Then, it becomes a lot harder. Rationing, learning to do without. Readjusting. Then it gets hard. Martial law, unrest, skyrocketing crime. Less than enough calories. Than it gets life threatening.
Ready for that journey?

D.  Life during the collapse
So far we have followed trends already occurring. Now we move into murkier waters. The next phase, life during a collapse, is pretty straight forward. We have countless examples during the last century of war and conflict. Our situation will differ slightly, as we are not used to invasion or being an exploited colony. But we can guess at a lot of it. Remember, America was special at one time. We had the best government and the best society, despite a lot of flaws such as slavery, Jim Crow laws, Native American genocide and the like.
Sadly, we are reverting to typical heavy handedness as our resources run down and most likely will become just like any other fascist hell hole in time. The window dressing given our current government transformation should fool no one. Just because you call ‘water boarding’ or rendition Constitutional doesn’t make it any less like torture. Get used to it. It will get worse, not better. All societies decaying get a centralized government to manage the same in the economy. It doesn’t matter who is elected anymore. Not that elections are even fair or just. They are surely rigged. More of the same from now on. Czars will guide the Homeland. We are and will remain a curious American mixture of Nazi Germany and Soviet Russian and will be until the nation breaks apart. To think otherwise is to ignore history.
America was special, but will follow the path of past nations collapsing. We were blessed with natural resources which allowed us to share the wealth. These resources are now gone and as we fight for pieces of the diminishing pie the fight will get ugly. Free men were allowed to remain armed, almost uniquely American in practice. That abundance of personal weapons will make for a very bloody end. That is about the only way this collapse will differ from any other. Men will fight in a more decentralized fashion rather than being dependant on fewer sources for their weapons.

E.  Economic collapse
The collapse starts economically. It already has. Many people think this is a replay of the Great Depression of 1929 to 1942. Understandable as that is the only model on display. So, they believe this is another power grab by the bankers. Before, there were independent banks, not beholden to the new central bank, the Federal Reserve. In 1913 Congress slipped in its creation in a slow holiday period. Those banks that engineered and “solved” a previous bank panic pushed for its creation under the guise of stability. One imagines this was one of the cheapest national and economic power grabs ever. The bribes paid must have been mere pocket change compared to what followed. The banks then loaned money to the Allied powers during the First World War and pushed for our involvement when they were in danger of defeat and hence default. The German reparations also benefited the banks. Which paved the way for Hitler (also thought to have banker backing).
The easy credit of the 1920’s was courtesy of the Federal Reserve, which led to gross over extension and the Wall Street crash. Then, the Fed mopped up by buying failing banks that weren’t part of the central banking system, foreclosed on hard assets such as businesses, homes and farms, plus engineered FDR’s gold devaluation and confiscation to assure its printing press monopoly. It was in effect a decades long coup de ta. So, obviously, the banks know no limit to greed and want even more. Yet, what is there to gain this time? We were the global oil exporter, the globes premiere manufacturing economy. We were the global breadbasket. Today, we have no real economy other than a consumer economy with imported Chinese goods.
We import seventy percent of our oil, so there is a doubt we can even have enough for a bare minimum life support system.
We import twenty percent of our food, with domestic production endangered by water supply problems, oil dependency for fertility and transport and our ethanol program competing for stomachs.
There can be nothing but Monopoly money for anyone trying to win these spoils. I don’t think that this is a banker manipulated problem. It would be stealing gold trim off a sinking Titanic. I think this is the real deal. God, but I wish this was one conspiracy theory I would love to be right. It might mean we wouldn’t collapse in my lifetime. But this does line up with petroleum draw down. So let’s go ahead assuming this is really an economic collapse.

This is just the start of our problems. Normally, a few extra barrels of food, a couple of solar panels, some extra ammunition and a few silver coins would see us through until normalcy returned.
I’ll go ahead and cover the economy, then we can move into the much larger problems of system wide collapse. Those that make the economic collapse a warm up. Economic collapse makes matters worse for everyone, for obvious reasons. With soaring unemployment those households with diminishing income will immediately see petroleum shortages, regardless of outside supply. And when international trade starts to freeze up our nation will face oil shortages regardless of where international supply is at that point. An economic collapse will actually help in the oil run down since far less will be used. Less economic activity will see less energy use.
One the other hand, diminishing demand will scale back exploration, pipeline construction, new field development or even existing infrastructure upkeep. So the effects all in all will be to magnify oil shortages. Already in the winter of ’08 international trade in goods is down sharply, simply from the freeze up in credit. Gasoline prices at the pump were down to the levels not seen for five years (those five years saw doubling prices of everything due to inflation and a weakening dollar). Yet the economic downturn is well under way and decreasing energy prices are not boosting activity. This is the interplay between economics and energy. It looks as if the collapse will continue, mostly economic rather than from oil shocks. Is there a correlation between the three year long drop in oil supply and the economy? Global oil supply fell around five percent. Imported oil to the US fell eight percent. Most likely this was the trigger setting off the financial time bomb that grew larger since the Tech Wreck at the turn of the millennium. For seven years the economy was not allowed to falter due to easy credit creation. Housing bubbles fed the economy. This has faltered drastically and the financial house of cards seems to be going up in smoke.

As employment falls, housing loses value. Less jobs, more foreclosures, less value on homes as values drop as housing inventories explode. Credit is squeezed everywhere. There are no more home equity loans. Personal credit cards are seeing shrinking credit limits. Between the two, no one can make ends meet on credit. Businesses fail as their credit dries up. For a long time, business activity was not much more than buying out your rivals and acquiring its customers. Without credit to expand, business activity shrinks. Driving up unemployment. It is a vicious cycle.
Big businesses with high legacy costs are desperate. When vehicle sales drop due to rising unemployment and shrinking credit, Detroit can’t meet current retiree costs. Bankruptcy looms. If you think Detroit is bad now, with slum homes for sale for $600 in back taxes and an unemployment rate double that of most other areas, wait until the auto makers go belly up. And don’t think Toyota will rescue them. It is seeing sales fall over thirty percent in one year. Japanese companies are very well run, but their biggest customer is the US. Falling demand effects everyone.
Commodities stop their recent drive upwards. Gold companies close due to credit problems. Increasingly, people and businesses look for federal government help. As the government sees overseas loans dry up, hyperinflation is just over the horizon. There will be no other way to pay for the increased need for the welfare state. We will see a short period of declining prices as inventories soar and the remaining businesses are desperate for sales. Then we will see prices go insane as Washington turns on the printing presses (a lot easier now with computers replacing a lot of paper currency).

Remember, the economy is the result of cheap and abundant energy. Nothing else made it possible for our bloated welfare state and empire spanning military to function. Yes, the economy is going to be very important to you as it implodes. After a time, it won’t matter about global oil reserves. The price of gas is unimportant if you repoed your car and the electric company shut off your power. But it is important for a very simple fact. Declining global supplies of petroleum mean that the economy won’t recover. We will have ups and downs, false recoveries and periods of slowing decline. But long-term, we will not see the old days return. It is the beginning of the end. Don’t mistake this for a simple economic Depression. It is also coupled with oil draw down. Decline is here for good. The severity and timing are the only questions.

F.  Oil run down
Oil draw down is the process of running out of petroleum. Oil production is a bell curve. Sharply up, a plateau is reached, the numbers level off and then we start on the down side. A sharp downturn of oil production. Currently we are at the plateau where we have global oil production leveled off. How long this lasts is anyone’s guess. It won’t be that long however. Some very educated guesses have our oil age at about a hundred years. Take 1930 as a start, when oil really started to dominate rather than being a source of illumination only. By the end the 1970’s per capita global energy use started to decline, the half way point. In 2030 we will be back to the level of one hundred years previously in total oil use ( yet with a much larger population and no other way of powering the food and production like we had in 1930 ). But don’t think we have until 2030. The availability of oil is already starting to suffer. All of the king size fields are in decline, including Saudi Arabia. And no large fields have been discovered in fifty years. There will be no Alaska or North Sea oil to save us from the next oil shock. And, least you think cheap gas is a great Christmas present for 2008, this economic disincentive will discourage smaller fields from being exploited. Those would have smoothed out the large field slowdown. Right now the only thing smoothing it out is the fact that economic activity in the worlds largest oil user is in a tailspin. Less US oil use is helping to disguise oil draw down. Enjoy $1.50 a gallon gas, because it will be the last time energy is going to be cheap. We are, simply, running out of energy on a global scale. It wouldn’t be too bad if we only had to turn down the thermostat and stop driving our SUV’s so much. But, we will soon discover to our dismay, cold houses and weeds growing up the wheels of our thirty thousand dollar sheet metal monster are the least of our problems. Oil, today in our country and most other places outside Third World peasant fields, is food. Without oil there is no food. Without food there is famine.

G.  Famine
Famine is not something most of us ever consider. This country has been the bread basket of the world for over a century. The Ukraine used to be the bread basket of Europe before collectivism introduced by the communists. It isn’t that the soil isn’t still fertile, but back again to infrastructure, you need a stable system to reap resources. In America’s case, we are not only farming on infertile soil due to corporate profit being put ahead of maintaining the most strategic resource we used to command, but the only way to continue farming enough to feed the population we have is to pour oil into the process. Most of our fertilizer is not renewable animal manure, but non renewable artificial fertilizer derived from natural gas. We can’t use animal fertilizer as manure, or non mechanized machinery to farm because they don’t work for corporate farming. They are financially inefficient. Corporate farming is our main source of food, and they can’t function without oil. Or, for that matter, easy and cheap credit which may or may not be available in the near future. Now, it is true that there is enough widespread knowledge about intense labor organic farming that we will be able to switch to that form of food production when needed. However, that depends on government no longer favoring large corporations with taxes and subsidies. We can’t go back to decentralized, low lost farming without the government stepping out-of-the-way. Mainly by eliminating high property taxes. As suburbs have encroached on farmland, farmers have seen their land values skyrocket. So their taxes go up. Yet, grains are a commodity sold by volume by the big players. The little farmer can’t compete. The system favors the corporate farmer.

Now, by the time the government no longer favors the rich corporate lobbyist and allows small farms to proliferate, we might already see cracks appearing in the food supply chain. Governments move slowly. Especially if re-election money from deep pockets is at stake. However, our food supply is now on a just-in-time inventory system. We harvest it and ship it out. There are no longer any months long supplies of grain stockpiled, as was the case during the Cold War when it was felt feeding the population in an emergency was a good thing. Now, any widget sitting on store shelves is considered as lost profit to our bankers and corporations. Come any calamity, there is no stockpiled supply to see us through. And even if there were, you need to take into account our transportation system and our banking system. Less oil will also affect our ability to ship crops. And any problems with our credit system will halt shipping anyway. American business (I have left out of the equation our imported food- it constitutes 20% but is mostly processed or luxury goods and can be survived without) are used to ninety day credit. They buy on credit, then pay after they sell the item. This poses a potential problem. So, again, we see both oil and economics as a problem. Food should not be assumed to remain a gluttonous American birthright. We can see a famine, and since none of us remain farming the land it could be as bad as any African calamity or even worse. We have no cushion against shortages. And no stockpile to see our transition from mechanized corporate farming to decentralized local labor intensive organic farming.

H.  Military dictatorship
With both a shock to the economy from dwindling oil supplies and a potential of famine bringing on heavily armed civil unrest, we can be assured that government will at some time or another impose martial law. Whether we see a military dictatorship or not is not even very important. Whatever cosmetics they put on the pig to make it look like something else, the outcome to civilians is going to be the same. Whatever illusion you have that the Constitution will help you will finely be shattered. We don’t have a Constitutional Republic anymore. You can argue we haven’t had one since the War Of Northern Aggression. When a sovereign state which voluntarily joined a Union is forced at gunpoint from leaving same, you can call that a pretty firm break with the document that is supposed to protect our natural rights and limit the power of the government. But, barring that, perhaps because you are a Damn Yankee and won’t confess to a social crime committed by your ancestors like Southerners are supposed to do with slavery, you could at least make a good case that our Republic was sold out by creating the Central Bank in 1913. He that controls the purse strings controls the politicians. Even if that isn’t good enough for you, you have to admit that FDR (may his twisted foul soul be damned for all eternity) took whatever restraints on Federal government there were and wiped his liver spotted ass with them. After him, we had full blown socialism and an out of control military industrial complex along with unbridled bankers and corporate stoolies help them out to rape and pillage what was left of our nation. So, don’t think that quaint piece of paper is going to protect you. It hasn’t and it won’t. The only question we have to ask ourselves is, when and how bad. It is guaranteed to happen. All declining civilizations become despotic at the end. Centralization helps then survive and thrive. But you need a strong government to go from local, decentralized production to centralized control. For a time the economics of scale feed yet more population and bring ever more treasure to the king. When disaster strikes and resources start to run out (fertile soil, neighbors to conquer, rainfall, mild weather, mineral deposits, etc.) you can’t go back, as there are not enough resources to rebuild the old decentralized infrastructure. The only thing you can do is to tighten your control. Try to extract more resources from the profit takers. Try to prevent disorder and rioting as resources run out.

So, don’t think of the power grabbers introducing more fascism as just greedy and controlling. They are, but that is not the point. They are being played by events out of their control, just as you are. Resources run out and the government becomes stronger. They need to keep themselves running, not only to keep order so as to stay in power, but also because those benefiting from the old system won’t allow them to do it any other way. As the system crumbles, those benefiting economically from practices now harming things can’t give up what made them wealthy. They need that wealth to survive.

So, Roman Senators allowed their estates to play out of fertile soil just as there was no more fertile lands to take militarily. Southern plantation owners did the same, just as there were no more states to enter the Union as slave holders. New soil was needed to keep the rich wealthy since they had used theirs up, and there was no more to be had. It is going to be the same with the wealthy of today, those that buy and control politicians. Highly leveraged financial gambles will continue to be sold to the last sucker before the whole economy implodes. The last tanks using the last gasoline will fight over the last oil field, more than likely illuminated by radioactive glows from the distant city sites. No one is going to seriously push for independently owned cheap solar panels on every rooftop. The only serious solar (as far as supplying any large percentage of energy) will be centrally located and controlled by major utilities.

Martial law is as inevitable as the sun rising. No one voluntarily gives up power and wealth. When people begin to starve, they revolt. To keep the revolutionaries from sharing their wealth, the rich use the government to control the population. Luckily for use, our government can’t put many resources into this proposition. There is no real wealth behind them, just printed dollars backed by the ( dwindling supply from ) oil fields of Saudi Arabia. Economics also effects the government’s ability to pay for people and supplies. I’m not saying they won’t steal what they need, just that a broke and weak government is going to be trying to pacify a three thousand mile long nation at a time when transportation is not as easily fueled. As long as the oil flows, a relatively small government and military can control us. In fact, most of us want to be controlled. When that runs out, it will be a long-term losing battle to control us. Small consolation to concentration camp victims or tortured dissidents. I can’t see more that is going to be added from the long sorry history of martial law by us. We will start out being pretty brutal. When you don’t have a lot of resources to control people, you start out trying to terrorize them so most offer no resistance. This is how the Japanese controlled large areas of land with few soldiers. You give that crazy little bastard a bayonet and instructions to chop suey anything less than perfectly obsequious. I can’t see Americans anywhere close to as effective as the Japanese at pacification. We might have a few folks like Janet “BBQ” Reno able to torch small children or jack booted thugs willing to stomp kittens to terrorize a family, but they belong in the psycho wards to begin with. Normal folks have no ability to do these things, let alone to their own countrymen. Plenty can be brainwashed, but not enough to control all of us for very long. Yes, it will be brutal and bad at first, but the few thugs the Feds have will quickly lose control. There will not be enough of them to control the millions too hungry and cold to care anymore. Desperation will help the government for a time, then it will turn things against them. We will happily turn in our neighbors for unpatriotic thoughts, in return for bread and circuses. When that is no longer provided, the ‘narcs’ and stooges will turn on their handlers. Which is when we will see race wars on our way towards the national breakup.

I.  Race wars
The truly ignorant actually try to see a difference in people by their skin color or their religion. This can be pretty comical at times, if you are outside looking in. Such as the Nazi’s and the convoluted racial classifications trying to protect “pure” whites while discriminating against Jews or Slavic’s. Is a White Russian okay, but a Ukrainian not? Or a gypsies bad, even if they are mostly from Aryan stock? Why is a Jew impure if he is from a long line of Germans? Is the picture perfect white German less pure if his great-grandmother one-third Jew? Etcetera. My view is that skin is really not much more than adaptation to environment, but I’m sure that view will get me on a few elimination lists if the three members of the American Nazi party can get a few meth addled skinheads to assassinate me. Well, add the fact that I’ve been married to more than one Mexican gal. I sure wasn’t worried about protecting the purity of my race those times, even if I did practice birth control. Most people, despite the continual indoctrination of our public school systems (the ones controlled by white politicians that send their kids to private schools charging enough tuition to eliminate most of those of a darker hue) still have a certain problem with other races, even if they don’t know why. Typically, I hear racist attitudes along the lines against those types they didn’t grow up around. I have no problem with Mexicans, growing up in Southern California. But to be honest the majority of blacks are like foreigners to me. The reason is not skin color. That is a cop out for those not wishing to think the matter through. It is simply about tribal identity. And fear of the unknown. But mostly tribal. Humans belong in social groups. It is a survival mechanism. And we automatically identify with our tribe and against others. We are usually lazy and rather than rationally voice this, we spew some crap about skin color (and you all know the “colorful” terms used to describe other races). That is a mental shortcut. Give it any amount of thought and you can see what I’m talking about. Tribe equals safety. Other tribal members equal the enemy. Whether they are different skin colored or not is not the main issue, other than that is a sign of their tribal identity.

Multi-racial nations rarely work out long term. The tribal marks are not overcome in difficult times by national identity. During safe, economically easy times, we can all get along. As soon as times turn tough the old tribal markers mean a great deal more. We will have racial conflict. Not because blacks are evil, or whites are superior. It doesn’t matter. You can be any color. Others will turn against you. Skin color is just another excuse to exclude you from another’s tribe. Religion will also be dividing. But with the long history of conflict between the colors in this country, it will be easy to justify unpleasantries against others due to their skin. Blacks have a long grievance against whites, whites have always feared blacks because of this. Mexicans have been exploited economically, and we did steal a lot of their land (although to be fair they stole it from the Indians). Indians were nearly wiped out through germ warfare and have a lot of justifiable issues. I sure wouldn’t want to be living near any fair sized reservation come hard times. Nor near any ghettos, regardless if it is black or Mexican. A wouldn’t want to be a white living in Hawaii for that matter. Living in northern Nevada with a clear majority of whites is not preferred because I am racist. It is because I am trying to be on the local winning tribes side. Simply self preservation. You might give it some thought. Do you trust other tribes to treat you fairly when times get tough and they have an economic incentive to expel you ( less mouths at the limited trough )? And they won’t be offering a first class ticket on Amtrak to leave town. Far easier to attack you with ball bats and tire irons and throw you in a shallow mass grave.

Look at the tribal conflicts in eastern Europe or Africa. Skin color doesn’t come into play as much as actual tribes going back centuries. But the dynamic is the same. Starvation looms and one tribe turns against another. That tribe which eliminates the other survives on the limited resources available. This is human nature and explains why there are conflicts. I’ll cover this more later on, but it is pretty simple. Group identity is a survival mechanism, safety in numbers. And stealing another groups resources guarantees one group will survive in lean times. No one joins hands and sings about one world and helps those less fortunate in times of hunger. Not when both groups are starving. Charity is only possible when one group has a surplus. Without that, one groups kills off another to survive with full rather than half rations. And they will justify it in many ways, racial, tribal, vendettas, etc. Race wars will happen in this country as soon as times get genuinely tough. Count on it or you will belong to the body count.

Continued in (Survival Manual/2. Social Issues/Life After the Collapse, Part 2 of 2)

If you’d like to read the entire book, Life After the Collapse by James M. Dankin
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Financial collapse

(Survival Manual/1. Disaster/Financial Collapse)

The great play

‘The Coming Liquidity Tsunami Into Something Real’
14 May 2011, Gold Eagle editorial, by Mark J Lundeen
<http://www.gold-eagle.com/editorials_08/lundeen051411.html> and <Mlundeen2@Comcast.net>
“I was once told, by someone who’s name I’ve long since forgotten, that the ancient Greeks once pondered death from a scientific perspective: One day Pericles was manning the walls of Athens against the Spartans. The next day a plague came and Pericles was gone, though his now room-temperature body was still in Athens.

Question: what changed?

Maybe warming his now cold body would cause Pericles to return; and then again, maybe not! But who can say until we try?

If I were to write a script for a play, using the Peloponnesian War as a motif of the current financial situation, the US financial system would certainly be Pericles: glorious and powerful one day, and somewhat else the next.

If asked, I’m sure the academics from our Ivy-League schools of social sciences would demand to play the part of the old Greek philosophers. But I see them more as the vectors of “policy” that has pulled our poor hero down to his lamentable state. That leaves us with what to do with the politicians?

Well no one would ever mistake these corrupt, baby-kissing sycophants for Greek philosophers! So, I guess the politicians will have to play the part of the vectors of “policy” and I’ll let Doctor Bernanke dress up like Socrates.

In the opening scene, Pericles lays still on a marble slab, at room temperature, when Doctor Bernanke orders members of the AMA (Athenian Medical Association) to warm poor Pericles’ human remains to that of the living. He steps back into the gloom of the Parthenon, as a Greek choir (played by the financial media) then lets loose a mournful chant, 3 times:
“Woe unto Athens! Though the philosophers have warmed worthy Pericles until his toes smoke, still neither does he move nor speak!”

A brilliant spot light cuts through the gloom of the scene, highlighting the noble presence of Socrates (played by Doctor Bernanke) as he brings the Greek Choir to silence with a sweep of his arm, and proclaims to the audience (played by everyone who still believes their pension fund and social security will be worth something ten years from now):
“Pericles needs not move nor speak to serve Athens well. A pulse he needs not. As long as the wise men of “policy” can maintain his body temperature above that of the marble slab on which he rests, all will be well!”
The spot light fades to black, the curtain closes, and all educated and respectable people are happy with the performance, and will continue to be until dear Pericles begins to reek more than “policy” predicted. This is as good a way of understanding the current state of the debt markets as any you’ll  see on TV or in the papers. Think of structured finance, using derivatives in the hundreds-of-trillions, as “policy’s” method of giving trillions of dollars in dead assets the appearance of being alive, though a closer inspection shows they are merely warm and motionless.

The secondary market in American mortgages stopped trading several years ago, so for what purpose are these dubious derivatives still serving? I suspect someday we will discover that this is the “policy makers” chosen method to enable trillions of dollars of worthless mortgage assets held by large banks, to continue generating income for the financial system.
[Image above right: Pericles,  495-429BC]

The show goes on
Derivatives are simply another form of margin, the nemesis which caused the last great market crash. This time though it’s “different enough from the last time so no one realizes what is happening.” Use this analogy: “…it is like the floor show in a seedy nightclub. A sequence of girls trots on the scene, first a collection of Apaches, then some ballerinas, then cowgirls and so forth. Only after a while does the bemused spectator realize that, in all cases, they were the same girls in slightly different costumes.” In other words, “the so-called hedge fund actually is an excuse for a margin account.”
Pasted from <http://www.usagold.com/derivativeschapman.html>
.

Act 1:  We go broke

 It Is Now Mathematically Impossible To Pay Off The U.S. National Debt
4  Feb 2010, The Economic Collapse
<http://theeconomiccollapseblog.com/archives/it-is-now-mathematically-impossible-to-pay-off-the-u-s-national-debt>
A lot of people are very upset about the rapidly increasing U.S. national debt these days and they are demanding a solution. What they don’t realize is that there simply is not a solution under the current U.S. financial system. It is now mathematically impossible for the U.S. government to pay off the U.S. national debt. You see, the truth is that the U.S. government now owes more dollars than actually exist. If the U.S. government went out today and took every single penny from every single American bank, business and taxpayer, they still would not be able to pay off the national debt. And if they did that, obviously American society would stop functioning because nobody would have any money to buy or sell anything.

And the U.S. government would still be massively in debt. So why doesn’t the U.S. government just fire up the printing presses and print a bunch of money to pay off the debt?  Well, for one very simple reason. That is not the way our system works.
You see, for more dollars to enter the system, the U.S. government has to go into more debt.
The U.S. government does not issue U.S. currency – the Federal Reserve does.

The Federal Reserve is a private bank owned and operated for profit by a very powerful group of elite international bankers. If you will pull a dollar bill out and take a look at it, you will notice that it says “Federal Reserve Note” at the top. It belongs to the Federal Reserve.

The U.S. government cannot simply go out and create new money whenever it wants under our current system. Instead, it must get it from the Federal Reserve. So, when the U.S. government needs to  borrow more money (which happens a lot these days) it goes over to the Federal Reserve and asks them for some more green pieces of paper called Federal Reserve Notes.

The Federal Reserve swaps these green pieces of paper for pink pieces of paper called U.S. Treasury bonds. The Federal Reserve either sells these U.S. Treasury bonds or they keep the bonds  for themselves (which happens a lot these days).

So that is how the U.S. government gets more green pieces of paper called “U.S. dollars” to put into circulation. But by doing so, they get themselves into even more debt which they will owe even more interest on. Every time the U.S. government does this, the national debt gets even bigger and the interest on that debt gets even bigger.
Are you starting to get the picture?

[Image at left: $1 trillion in $1 bills would fill the interior of the Empire State building.
The current $14.3 trillion debt (May 2011) would fill a 3/4 mile high block, 50% higher than the green block shown in  the picture at left.
Consider this: One hundred dollars in one dollar bills, pressed down, measures about ½ of an inch. One million, 100 dollar bills, measures four feet in height. One billion 100 dollar bills is 4,000 feet high, almost three Sears Tower buildings tall.
$1 trillion $100 dollar bills measures 789 miles, or one hundred and forty four Mt. Everests stacked on top of each other. Our national debt is more than 14 times THAT… ]

As you read this, the U.S. national debt is approximately 12 trillion dollars, although it is going up so rapidly that it is really hard to pin down an exact figure. So how much money actually exists in the United States today? Well, there are several ways to measure this.

The “M0” money supply is the total of all physical bills and currency, plus the money on hand in bank vaults and all of the deposits those banks have at reserve banks. As of mid-2009, the Federal Reserve said that this amount was about 908 billion dollars.

The “M1” money supply includes all of the currency in the “M0” money supply, along with all of the money held in checking accounts and other checkable accounts at banks, as well as all money contained in travelers’ checks. According to the Federal Reserve, this totaled approximately 1.7 trillion dollars in December 2009, but not all of this money actually “exists” as we will see in a moment.

The “M2” money supply includes everything in the “M1” money supply plus most other savings accounts, money market accounts, retail money market mutual funds, and small denomination time deposits (certificates of deposit of under $100,000). According to the Federal Reserve, this totaled approximately 8.5 trillion dollars in December 2009, but once again, not all of this money actually “exists” as we will see in a moment.

The “M3” money supply includes everything in the “M2” money supply plus all other CDs (large time deposits and institutional money market mutual fund balances), deposits of Eurodollars and repurchase agreements. The Federal Reserve does not keep track of M3 anymore, but according to ShadowStats.com it is currently somewhere in the neighborhood of 14 trillion dollars. But again, not all of this “money” actually “exists” either.
So why doesn’t it exist?
It is because our financial system is based on something called fractional reserve banking.

When you go over to your local bank and deposit $100, they do not keep your $100 in the bank.
Instead, they keep only a small fraction of your money there at the bank and they lend out the rest to someone else. Then, if that person deposits the money that was just borrowed at the same bank, that bank can loan out most of that money once again. In this way, the amount of “money” quickly gets multiplied. But in reality, only $100 actually exists. The system works because we do not all run down to the bank and demand all of our money at the same time. [All going at the same time  is what a ‘bank run’ is]

According to the New York Federal Reserve Bank, fractional reserve banking can be explained this way….”If the reserve requirement is 10%, for example, a bank that receives a $100 deposit may lend out $90 of that deposit. If the borrower then writes a check to someone who deposits the $90, the bank receiving that deposit can lend out $81. As the process continues, the banking system can expand the initial deposit of $100 into a maximum of $1,000 of money ($100+$90+81+$72.90+…=$1,000).”
So much of the “money” out there today is basically made up out of thin air.
In fact, most banks have no reserve requirements at all on savings deposits, CDsand certain kinds of money market accounts. Primarily, reserve requirements apply only to “transactions deposits” – essentially checking accounts.

The truth is that banks are freer today to dramatically “multiply” the amounts deposited with them than ever before. But all of this “multiplied” money is only on paper – it doesn’t actually exist.
The point is that the broadest measures of the money supply (M2 and M3) vastly overstate how much “real money” actually exists in the system.

So if the U.S. government went out today and demanded every single dollar from all banks, businesses and individuals in the United States it would not be able to collect 14 trillion dollars (M3) or even 8.5 trillion dollars (M2) because those amounts are based on fractional reserve banking.

So the bottom line is this….
1)  If all money owned by all American banks, businesses and individuals was gathered up today and sent to the U.S. government, there would not be enough to pay off the U.S. national debt.
2)  The only way to create more money is to go into even more debt which makes the problem even worse.
You see, this is what the whole Federal Reserve System was designed to do. It was designed to slowly drain the massive wealth of the American people and transfer it to the elite international bankers.

It is a game that is designed so that the U.S. government cannot win. As soon as they create more money by borrowing it, the U.S. government owes more than what was created because of interest.
If you owe more money than ever was created you can never pay it back. hat means perpetual debt for as long as the system exists.
It is a system designed to force the U.S. government into ever-increasing amounts of debt because there is no escape.
We could solve this problem by shutting down the Federal Reserve and restoring the power to issue U.S. currency to the U.S. Congress (which is what the U.S. Constitution calls for). But the politicians in Washington D.C. are not about to do that. So unless you are willing to fundamentally change the current system, you might as well quit complaining about the U.S. national debt because it is now mathematically impossible to pay it off.
.

Act 2:  They go broke

What happens when Greece defaults?
25 May 2011, The Telegraph, By Andrew Lilico
http://blogs.telegraph.co.uk/finance/andrewlilico/100010332/what-happens-when-greece-defaults/
It is when, not if. Financial markets merely aren’t sure whether it’ll be tomorrow, a month’s time, a year’s time, or two years’ time (it won’t be longer than that). Given that the ECB has played the “final card” it employed to force a bailout upon the Irish – threatening to bankrupt the country’s banking sector – presumably we will now see either another Greek bailout or default within days.

What happens when Greece defaults. Here are a few things:
•  Every bank in Greece will instantly go insolvent.
•  The Greek government will nationalize every bank in Greece.
•  The Greek government will forbid withdrawals from Greek banks.
•  the Greek government will declare a curfew, perhaps even general martial law.
•  Greece will redenominate all its debts into “New Drachmas” or whatever it calls the new currency (this is a classic ploy of countries defaulting)
•  The New Drachma will devalue by some 30-70 per cent (probably around 50 per cent, though perhaps more), effectively defaulting on 50 per cent or more of all Greek euro-denominated debts.
•  The Irish will, within a few days, walk away from the debts of its banking system.
•  The Portuguese government will wait to see whether there is chaos in Greece before deciding whether to default in turn.
•  A number of French and German banks will make sufficient losses that they no longer meet regulatory capital adequacy requirements.
•  The European Central Bank will become insolvent, given its very high exposure to Greek government debt, and to Greek banking sector and Irish banking sector debt.
•  The French and German governments will meet to decide whether (a) to recapitalize the ECB, or (b) to allow the ECB to print money to restore its solvency. (Because the ECB has relatively little foreign currency-denominated exposure, it could in principle print its way out, but this is forbidden by its founding charter. On the other hand, the EU Treaty explicitly, and in terms, forbids the form of bailouts used for Greece, Portugal and Ireland, but a little thing like their being blatantly illegal hasn’t prevented that from happening, so it’s not intrinsically obvious that its being illegal for the ECB to print its way out will prove much of a hurdle.)
•  They will recapitalize, and recapitalize their own banks, but declare an end to all bailouts.
•  There will be carnage in the market for Spanish banking sector bonds, as bondholders anticipate imposed debt-equity swaps.
•  This assumption will prove justified, as the Spaniards choose to over-ride the structure of current bond contracts in the Spanish banking sector, recapitalizing a number of banks via debt-equity swaps.
•  Bondholders will take the Spanish Banking Sector to the European Court of Human Rights (and probably other courts, also), claiming violations of property rights. These cases won’t be heard for years. By the time they are finally heard, no-one will care.
•  Attention will turn to the British banks.

Then we shall see…

Ilargi:
What I think is important is to connect the dots here. Greece is but a two-bit player relatively speaking, but the effects of a default in Athens, and the haircuts it would force upon financial institutions (and dare we even consider pensions funds?!), would -make that will- be felt across the world. For one thing, it would substantially weaken banks and economies pretty much around the globe. Just Greece alone.

It all comes back all the time to the dreaded mark-to-market theme. The last thing anyone wants is to let anyone else know what the paper they’re holding is truly worth. But it will be done.
.

Act 3: All go broke

Derivatives: The Quadrillion Dollar Financial Casino Completely Dominated By The Big International Banks
<http://theeconomiccollapseblog.com/archives/derivatives-the-quadrillion-dollar-financial-casino-completely-dominated-by-the-big-international-banks>

“If you took an opinion poll and asked Americans what they considered the biggest threat to the world economy to be, how many of them do you think would give “derivatives” as an answer? But the truth is that derivatives were at the heart of the financial crisis of 2007 and 2008, and whenever the next
financial crisis happens derivatives will undoubtedly play a huge role once again. So exactly what are “derivatives”?
Well, derivatives are basically financial instruments whose value depends upon or is derived from the price of something else. A derivative has no underlying value of its own. It is essentially a side bet.
Today, the world financial system has been turned into a giant casino where bets are made on just about anything you can possibly imagine, and the major Wall Street banks make a ton of money from it. The system is largely unregulated (the new “Wall Street reform” law will only change this slightly) and it is totally dominated by the big international banks.

Nobody knows for certain how large the worldwide derivatives market is, but most estimates usually put the notional value of the worldwide derivatives market somewhere over a quadrillion dollars.
If that is accurate, that means that the worldwide derivatives market is 20 times larger than the GDP of the entire world. It is hard to even conceive of 1,000,000,000,000,000 dollars.
Counting at one dollar per second, it would take you 32 million years to count to one quadrillion.

So who controls this unbelievably gigantic financial casino? Would it surprise you to learn that it is the big international banks that control it? The New York Times has just published an article entitled A Secretive Banking Elite Rules Trading in Derivatives. Shockingly, the most important newspaper in the United States has exposed the steel-fisted control that the big Wall Street banks exert over the trading of derivatives. Just consider the following excerpt from the article….

“On the third Wednesday of every month, the nine members of an elite Wall Street society gather in Midtown Manhattan. The men share a common goal: to protect the interests of big banks in the vast market for derivatives, one of the most profitable — and controversial — fields in finance. They also share a common secret: The details of their meetings, even their identities, have been strictly confidential.”

Does that sound shady or what?
In fact, it wouldn’t be stretching things to say that these meetings sound very much like a “conspiracy”. The New York Times even named several of the Wall Street banks involved: JPMorgan Chase, Goldman Sachs, Morgan Stanley, Bank of America and Citigroup. Why does it seem like all financial roads eventually lead back to these monolithic financial institutions?

The highly touted “Wall Street reform” law that was recently passed will implement some very small changes in how derivatives are traded, but these giant Wall Street banks are pushing back hard against even those very small changes as the article in The New York Times noted….

“The revenue these dealers make on derivatives is very large and so the incentive they have to protect those revenues is extremely large,” said Darrell Duffie, a professor at the Graduate School of Business at Stanford University, who studied the derivatives market earlier this year with Federal Reserve researchers. “It will be hard for the dealers to keep their market share if everybody who can prove their creditworthiness is allowed into the clearinghouses. So they are making arguments that others shouldn’t be allowed in.”

So why should we be so concerned about all of this?
Well, because the truth is that derivatives could end up crashing the entire global financial system.

In fact, the danger that we face from derivatives is so great that Warren Buffet once referred to them as “financial weapons of mass destruction”.

In a previous article, I described how derivatives played a central role in almost collapsing insurance giant AIG during the recent financial crisis….

Most Americans don’t realize it, but derivatives played a major role in the financial crisis of 2007 and 2008. Do you remember how AIG was constantly in the news for a while there? Well, they weren’t in financial trouble because they had written a bunch of bad insurance policies. What had happened is that a subsidiary of AIG had lost more than $18 billion on Credit Default Swaps (derivatives) it had written, and additional losses from derivatives were on the way which could have caused the complete collapse of the insurance giant. So the U.S. government stepped in and bailed them out – all at U.S. taxpayer expense of course.

As the recent debate over Wall Street reform demonstrated, the sad reality is that the U.S. Congress is never going to step in and seriously regulate derivatives. That means that a quadrillion dollar derivatives bubble is going to perpetually hang over the U.S. economy until the day that it inevitably bursts. Once it does, there will not be enough money in the entire world to fix it.

Meanwhile, the big international banks will continue to run the largest casino that the world has ever seen. Trillions of dollars will continue to spin around at an increasingly dizzying pace until the day when a disruption to the global economy comes along that is serious enough to crash the entire thing.

The worldwide derivatives market is based primarily on credit and it is approximately ten times larger than it was back in the late 90s. There has never been anything quite like it in the history of the world.

So what in the world is going to happen when this thing implodes? Are U.S. taxpayers going to be expected to pick up the pieces once again? Is the Federal Reserve just going to zap tens of trillions or hundreds of trillions of dollars into existence to bail everyone out?

If you want one sign to watch for that will indicate when an economic collapse is really starting to happen, then watch the derivatives market. When derivatives implode it will be time to duck and cover. A really bad derivatives crash would essentially be similar to dropping a nuke on the entire global financial system. Let us hope that it does not happen any time soon, but let us also be ready for when it does.”
.

Act 4:  The citizens speak


The Depression Of 2011?: 23 Economic Warning Signs From Financial Authorities All Over The Globe
28 May 2010, Daily Markets.com, by Michael Snyder
<http://www.dailymarkets.com/economy/2010/05/28/depression-in-2011-23-economic-warning-signs-from-financial-authorities-all-over-the-world/&gt;

“Could the world economy be headed for a depression in 2011? As inconceivable as that may seem to a lot of people, the truth is that top economists and governmental authorities all over the globe say that the economic warning signs are there and that we need to start paying attention to them. The two primary ingredients for a depression are debt and fear, and the reality is that we have both of them in abundance in the financial world today. In response to the global financial meltdown of 2007 and 2008, governments around the world spent unprecedented amounts of money and got into a ton of debt. All of that spending did help bail out the global banking system, but now that an increasing number of governments around the world are in need of bailouts themselves, what is going to happen? We have already seen the fear that is generated when one small little nation like Greece even hints at defaulting. When it becomes apparent that quite a few governments around the globe cannot handle their debt burdens, what kind of shockwave is that going to send through financial markets?

The truth is that we are facing the greatest sovereign debt crisis in modern history. There is no way out of this financial mess that does not include a significant amount of economic pain.

When you add mountains of debt to paralyzing fear to strict austerity measures, what do you get?
What you get is deflationary pressure and financial markets that seize up.

Some of the top financial authorities in the world are warning us that unless something substantial is done, that is exactly what we are going to be seeing as 2010 turns into 2011.

Of course some governments around the world could try to put these economic problems off for a while by printing and borrowing even more money, but we all know by now that only makes the long-term problems even worse.

For now, however, it seems as though most governments are opting for the austerity measures that the IMF seems determined to cram down the throats of everyone. So what will austerity measures mean for the global economy? Think “stimulus” in reverse.
Yes, things are going to get messy. It looks like there is going to be a great deal of economic fear and a great deal of economic pain in 2011 and the years beyond that.

So are we headed for “the depression of 2011”?
Well, let’s hear what some of the top financial experts in the world have to say….
1)  Economist Nouriel Roubini:
“We are still in the middle of this crisis and there is more trouble ahead of us, even if there is a recovery. During the great depression the economy contracted between 1929 and 1933, there was the beginning of a recovery, but then a second recession from 1937 to 1939. If you don’t address the issues, you risk having a double-dip recession and one which is at least as severe as the first
one.”
2)  Bank of England Governor Mervyn King:
“Dealing with a banking crisis was difficult enough, but at least there were public-sector balance sheets on to which the problems could be moved. Once you move into sovereign debt, there is no answer; there’s no backstop.”
3)  German Chancellor Angela Merkel:
“The current crisis facing the euro is the biggest test Europe has faced for decades, even since the Treaty of Rome was signed in 1957.”
4)  Paul Donovan, the Senior Economist at UBS:
“Now people are questioning if the euro will even exist in three years.”
5)  Michael Pento, Chief Economist at Delta Global Advisors:
“The crisis in Greece is going to spread to Spain and it’s going to be very difficult to deal with. They are bailing out debt with more debt and it isn’t sustainable. It’s a wonderful scenario for gold.”
6)  LEAP/E2020:
“LEAP/E2020 believes that the global systemic crisis will experience a new tipping point from Spring 2010. Indeed, at that time, the public finances of the major Western countries are going to become unmanageable, as it will simultaneously become clear that new support measures for the economy are needed because of the failure of the various stimuli in 2009, and that the size of budget deficits preclude any significant new expenditures.”
7)  Telegraph Columnist Edmund Conway:
“Whatever yardstick you care to choose – share-price moves, the rates at which banks lend to each other, measures of volatility – we are now in a similar position to 2008.”
8)  Peter Morici, an Economics Professor at the University of Maryland:
“The next financial tsunami is emerging and will ripple to America.”
9)  Bob Chapman of the International Forecaster:
“The green shoots of recovery have now turned into poison ivy. The abyss has again been filled with more debt and more fiat currency. In the process the Fed and now the ECB have lost all credibility.”
10)  Telegraph Columnist Ambrose Evans-Pritchard:
“The M3 money supply in the United States is contracting at an accelerating rate that now matches the average decline seen from 1929 to 1933, despite near zero interest rates and the biggest fiscal blitz in history.”
11) Professor Tim Congdon from International Monetary Research: “The plunge in M3 has no precedent since the Great Depression. The dominant reason for this is that regulators across the world are pressing banks to raise capital asset ratios and to shrink their risk assets. This is why the US is not recovering properly.”
12)  Reuters Columnist  Iliana Jonas:
“The default rate for commercial mortgages held by banks in the first quarter hit its highest level since at least 1992 and is expected to surpass that by year-end and peak in 2011, according to a study by Real Capital Analytics.”
13)  Paul Krugman, a Nobel Prize-winning Economist:
“It’s not hard to see Japan-style deflation emerging if the economy stays weak.”
14)  Stan Humphries, Chief Economist for Zillow.com:
“Anyone expecting a robust rebound in the housing market … will be sorely disappointed.”
15)  Fox News:
“As the national debt clock ticked past the ignominious $13 trillion mark overnight, Congress
pressed to pass a host of supplemental spending bills.”
16)  Bloomberg:
“The U.S. government’s Aaa bond rating will come under pressure in the future unless additional measures are taken to reduce projected record budget deficits, according to Moody’s Investors Service Inc.”
17)  Peter Schiff:
“When creditors ultimately decide to curtail loans to America, U.S. interest rates will finally  spike, and we will be confronted with even more difficult choices than those now facing Greece. Given the short maturity of our national debt, a jump in short-term rates would either result in default or massive austerity. If we choose neither, and opt to print money instead, the run-a-way inflation that will ensue will produce an even greater austerity than the one our leaders lacked the courage to impose. Those who believe rates will never rise as long as the Fed remains accommodative, or that inflation will not flare up as long as unemployment remains high, are just as foolish as those who assured us that the mortgage market was sound because national real estate prices could never
fall.”
18)   The National League of Cities
“City budget shortfalls will become more severe over the next two years as tax collections catch up with economic conditions. These will inevitably result in new rounds of layoffs, service cuts, and canceled projects and contracts.”
19)  Dan Domenech, Executive Director of the American Association of School Administrators:
“Faced with continued budgetary constraints, school leaders across the nation are forced to
consider an unprecedented level of layoffs that would negatively impact economic recovery and deal a devastating blow to public education.”
20)  Mike Whitney:
“Without another boost of stimulus, the economy will lapse back into recession sometime by the end of 2010.”
21) Kevin Giddis, Managing Director of Fixed Income at Morgan Keegan:
“There is big money making big bets that at a minimum we we’ll have a recession if not a depression that could last for years.”
22)  John P. Hussman, Ph.D.:
“In my estimation, there is still close to an 80% probability (Bayes’ Rule) that a second market plunge and economic downturn will unfold during the coming year. This is not certainty, but the evidence that we’ve observed in the equity market, labor market, and credit markets to-date is simply much more consistent with the recent advance being a component of a more drawn-out and painful deleveraging cycle.”
23)    Richard Russell, the Famous Author of the Dow Theory Letters:
Do your friends a favor. Tell them to “batten down the hatches” because there’s a HARD RAIN coming. Tell them to get out of debt and sell anything they can sell (and don’t need) in order to get liquid. Tell them that Richard Russell says that by the end of this year they won’t recognize the country. They’ll retort, “How the dickens does Russell know — who told him?” Tell them the
stock market told him.”

Other words of wisdom and woe…
1)  Jean-Claude Juncker,  Chairman of the Eurozone finance ministers and the currency union’s key spokesmen, 7 May 2011: “When it becomes serious, you have to lie”.
2)  George Orwell: “During times of universal deceit, telling the truth becomes a revolutionary act”
3)  Mark Twain: “There are three types of lies: Lies, Damned Lies, and Statistics.”

≈ Intermission ≈ 

 

Why The U.S. Economy Is Not Recovering
21 May 2011, Economic Crisis Writings, by Dick Kazan
http://economiccrisiswritings.blogspot.com/2011/05/why-us-economy-is-not-recovering.html
“20 million people unemployed, underemployed or no longer counted because they have been unemployed too long.
Falling home prices with no bottom in sight and foreclosures and notices of default mounting, as half of all home sales are now foreclosures or short sales in which owners lose their equity and lenders forgive some of the mortgage amount.

This is today’s American economy. Add to that young people also having trouble finding jobs including recent college graduates. And many people are defaulting on their credit cards, student loans and other financing. This is not what economists and pundits predicted. Why is this happening? What’s gone wrong? The answer is simple: 

1)  We are now a military industrial economy.
Coast to coast we produce weapons of mass destruction and delivery systems, including jet fighters, and for the 1st time in our history, we are now fighting perpetual wars. Before World War II, we had about 14 military bases and today we have well over a thousand all over the world. We spend as much on our military as the rest of the planet combined spends on theirs, and all of what we spend is at tax payers expense. It is draining the life out of our economy.
2)  Including its military expenses, and its refusal to tax the people to pay for it, the U.S. brings in only 59 cents for every dollar it spends. This in itself is a formula for financial disaster.
3)  Our finances are so dire, we are willing to slash our Medicare, Medicaid, Educational System (our children’s future) and Social Security (whose funds are now mostly a government IOU) and police and
fire protection in order to support our military industrial complex. Why?
Because they are a massive source of jobs. “Defense” is the one part of our economy that is booming [which includes Homeland Security].
4)  Wall Street and the stock markets are doing well because giant companies have shipped much of their manufacturing overseas and their profits are up. And stocks trade on profits, not on American jobs.
5)  Speaking of being up, gas prices are up as are food prices, clothing prices, doctor and hospital prices, college tuition and the cost of most everything else, as inflation is beginning to take hold. This
is a result of the Fed’s stimulus plans in which they print and circulate large sums of money in the vain hope we can spend our way out of this mess.

No my friend, we cannot solve a debt crisis by spending our way out of it. We will have to confront our problems and solve them, starting with ending our three wars. Then we must slash our military spending, which will bring hardship but hardship is coming anyway as we are going broke. Clearly the two political party monopoly under the control of lobbyists is failing us and it is long past time we
Americans raised our voices and got involved. This was a great nation and it can be great again. We must restore it for ourselves, for our children and for the world.

≈ The show resumes ≈

Act 5:  Consulting the Oracle

Predicting date of economic collapse (TSHTF)
2 Feb 2010, Gold Eagle editorial,  by Ray Elliott
<http://www.gold-eagle.com/editorials_08/elliott020210.html>
“The event that many would like advance warning on is economic collapse. It is an event that most informed economists say is inevitable due to U.S. deficits that are too large to be paid back. Yet, those of us that must work and pay our bills cannot stop what we are doing and dig a hole to hide in every time a new event happens that appears to be the beginning of the Economic Collapse.

We must first make assumptions on what Economic Collapse is. History tells us. All paper money falls into one of two categories, those that have failed and those that are going to fail. They failed in the past (including United States currency) in a spiral of constantly losing value. The federal government continually increases the obligations that it must pay for.
Buyers of federal debt slowly back away from buying long term debt and later will not purchase even short term debt. The government begins buying its own debt by issuing new paper money. As more paper money is issued it loses more and more of its value. When the public becomes aware that the issuance of paper money is out of control, and that holding it weeks or days will result in a loss of
value, they attempt to convert the paper money that they have into assets that retains some value. To do this, they have to remove any cash they have from banks and other institutions and convert it to something else. What ensues is a run on the banks.

When will this happen? We have some clues because of the process that will take place prior to
the event.

The Main Stream Media (MSM) generally is in favor of big government spending and supports the
socialistic policies of the Obama administration. The problem with socialism is that eventually you run out of other people’s money.  At the point that MSM begins to see the hazards of the uncontrolled printing of money, the beginning of the end is near. Then the Main Stream Media will begin to report the REAL MONEY CRISIS. For those that ask, “When will the SHTF?” That is when.

The events that follow this are events that you will not want to be a part of.
•  Long lines will appear at banks for those trying to get their money out while it still has some value.
•  Paper money will be issued in greater and greater denominations.
•  Food and other necessities of life will skyrocket in price.
•  Soon a bank holiday will be declared while the government attempts to control the panic.
•  Rules will be enforced that restrict how much money may be withdrawn at a time.
•  Attempts will be made to “freeze” food prices.
•  Payment for all goods and services will be turned upside down.
•  Everything will rapidly increase in price. Soon, the paper money you have will not buy the things that you need. At some point, $1,000 will not buy a pair of shoes.

The events that follow this are also predictable because they have happened before.
•  Gold and silver become extremely valuable. Pre 1965 silver coins (they still have some silver in them) will become a known standard of value that is accepted by those that still have something to sell.
•  The barter system for goods and services will return.
•  People that want to eat will grow gardens.
•  Most people who have had life savings in 401Ks will be poor again.
•  The winners are the ones that have planned in advance and the ones that still have outstanding loans or mortgages. The mortgages will no longer have any value. Homeowners will be able to send a million dollar note to a mortgage holder and tell them to keep the change. The change will not buy a loaf of bread.
•  Large cities will become dangerous places to be.
•  Those that plan ahead can avoid the most severe aspects of this scenario. It is up to each individual to plan ahead early enough to survive. A following article will outline some suggested courses of actions that any individual can implement.

.

Act 6:  The Public makes sacrifice

Personal Actions You Should Take Before the TSHTF!
Ray Elliott
<http://www.silverbearcafe.com/private/03.11/actions.html>
“In a previous article I discussed when the financial collapse will occur. This report will review some steps each individual should take in advance of the difficult days that are coming. Before going into the details, it is important for you to judge the necessity of following these steps. If you follow them and no collapse occurs, you have lost very little. If you follow them and the collapse occurs, these steps may save your life. If this discussion seems unreal, think about how unreal the world will be when the U.S. cannot pay its bills. Treasury Notes are no longer being purchased by China or Japan. Both are now selling (just like PIMCO). The Fed’s printing press is becoming the sole buyer.

Think about what your days are going to be like when paper money has no value. People that depend on government jobs, Social Security, food stamps, welfare, retirement checks or unemployment checks will no longer receive them. As the system winds down, some checks may be mailed, however; they will have little or no purchasing power. A new method of exchange will begin taking place.

Money in 401K’s will be gone. Money in banks will be worthless. Some people will benefit from the
collapse. Some that have mortgages will find that they now own the property, but no longer have a burdensome loan payment. Larger and larger denomination currency bills will drive out smaller denominations. You will be able to wipe out your mortgage by simply sending your mortgage company a million dollar bill and tell them to keep the change. The change will not buy a loaf of bread. The
banks know this and are making very few loans while foreclosing on others before TSHTF.

Silver coins (pre 1965 have silver in them) will be valuable for purchasing necessities. Gold coins will have great value, but will not be useful for small purchases. One or two ounces of gold may purchase a
home. Other basic necessities will be used for bartering to acquire goods that you need. In Russia, after 1989 or in Argentina, in the late 90’s, liquor was used as money to acquire goods. Producing alcohol requires having a small, home still (for distilling alcohol). Food items that you have stored or produce from your garden, sometimes gets too old for consumption (such as potatoes) and can be converted into alcohol with a still. Alcohol can be used for trading, for powering your generator or even fueling your vehicle. In post World War II Germany (during the German Occupation), poverty was widespread. A pack of cigarettes would purchase several hours of labor. Five gallons of gasoline was
worth a week’s supply of food. These days, medicines will be in demand (even outdated ones). Storing a quantity of aspirin will be useful for trading. Salt will also be used for money (as it was thousands of years ago).

Many have reviewed the need for storing sufficient food supplies. The amount depends on you and how many you need to sustain. Canned goods can be kept for two or more years. Rice and pasta in large bags can be kept in plastic storage boxes in a cool location. A water source and a method of sterilizing water are essential. Water disinfectants cost about one half cent per quart of water. Having a small garden will help feed your family. Storing good quality seeds is essential.

Finding a safe place for your family is more difficult to solve. Large population centers will not be safe. Those that have not prepared will begin taking from those that have prepared. Law and order will be sporadic because few in law enforcement will be paid. You should keep your survival supplies in or near the vehicle you plan on using when you leave. Getting out of town before TSHTF will be much easier than trying to leave later. Quickly relocating to a small town in a farming community will be much safer than remaining in a suburban home near a large city. Visit a small community near you now and set up a safe haven. See if you can arrange a garden and/or camping site. Small rural towns have lots for sale that can be acquired for very little. A small deposit can secure an option to purchase a lot in a small town that will give you a place to park your vehicle (a small motor home would be ideal) and a place for a garden. One quarter acre is more than you will need. Be careful about locating in a more remote location because it can be dangerous. In Argentina, roving bands of thieves routinely raided remote ranches and homes, inflicting both financial and physical harm. A small community is safer and may have an organized defense.

Last, but certainly not least is personal defense. Weapons are required. They can be used for both hunting and defense. Using the same caliber for both hand guns and long guns will save on the types
of ammunition needed to be stored. Nine millimeter is a good choice. A shotgun is both a good hunting weapon and a defense weapon. A 22 rifle is a good weapon to harvest small game for your family. A compound bow also serves both purposes. Having a plan of action when strangers appear is a necessity. In the meantime, you may ask yourself, can you defend your current home? Do you have a safe room? Do you have a guard dog? Do you have a warning system? Do you have friends nearby that would help you? How do you contact them?

As I stated in the beginning, you may never need to use any of these tactics. I pray that you do not. However; if and when TSHTF, you and your family will have a far better chance to survive than those that do not prepare.”

.

Act 7:  and with the Ides of March, the winds blew cold…

The Coming U.S. Depression of 2011/2012: Full of  homelessness, hunger, street  and the emergence of a 3rd party
7 Feb 2011, PBT Consulting
<http://tommytoy.typepad.com/tommy-toy-pbt-consultin/2011/02/the-coming-us-depression-of-20112012-full-of-homelessness-hunger-street-violence-and-the-emergence-o.html&gt;

“The man who predicted the 1987 stock market crash and the fall of the Soviet Union is now forecasting a revolution in America, food riots and tax rebellions – all within four years, while cautioning that putting food on the table will be a more pressing concern than buying Christmas gifts by 2012.

Gerald Celente, the CEO of Trends Research Institute, is publisher of the Trends Journal which forecasts and analyzes business, socioeconomic, political, and other trends, and is renowned for his accuracy in predicting future world and economic events which can send a chill down your spine.

Celente says that by 2012 America will become an underdeveloped nation, that there will be a revolution marked by food riots, squatter rebellions, tax revolts and job marches, and that holidays will be more about obtaining food, not gifts.

“We’re going to see the end of the retail Christmas… we’re going to see a fundamental shift take place… putting food on the table is going to be more important than putting gifts under the Christmas tree,” said Celente, adding that the situation would be “worse than the great depression.”

“America’s going to go through a transition the likes of which no one is prepared for,”said Celente, noting that people’s refusal to acknowledge that America was even in a recession highlights how big a problem denial is in being ready for the true scale of the crisis.

Celente, who successfully predicted the 1997 Asian Currency Crisis, the sub-prime mortgage collapse and the massive devaluation of the U.S. dollar, told UPI in November last year that the following year would be known as “The Panic of 2008,” adding that “giants (would) tumble to their deaths,” which is exactly what we have witnessed with the collapse of Lehman Brothers, Bear Stearns and others.

He also said that the dollar would eventually be devalued by as much as 90 per cent. The consequence of  what we have seen unfold this year would lead to a lowering in living standards, Celente predicted a year ago, which is also being borne out by plummeting retail sales figures.

[Movie image above: Bartertown where futureworld power structures fought over ‘pig shit- methane energy’; a time and condition which brought about roving, mobile gangs that killed and plundered their way across  the land.   This is the view of ‘collapse’ at the grass roots, an image from the movies.]

The prospect of revolution was a concept echoed by a British Ministry of Defense report last year, which predicted that within 30 years, the growing gap between the super-rich and the middle class, along with an urban underclass threatening social order would mean, “The world’s middle classes might unite, using access to knowledge, resources and skills to shape transnational processes in their own class interest,” and that, “The middle classes could become a revolutionary class.”

In a separate recent interview, Celente went further on the subject of revolution in America.There will be a revolution in this country,” he said. “It’s not going to come yet, but it’s going to come down the line and we ‘re going to see a third party and this was the catalyst for it: the takeover of Washington, D.C., in broad daylight by Wall Street in this bloodless coup. And it will happen as conditions continue to worsen.”
Internet image: This is how marginal people are affected – before the ‘main event’ unfolds; its what we see at the grass roots, this is reality.]

“The first thing to do is organize with tax revolts. That’s going to be the big one because people can’t afford to pay more school tax, property tax, any kind of tax. You’re going to start seeing those kinds of protests start to develop.”
“It’s going to be very bleak. Very sad. And there is going to be a lot of homeless, the likes of which we have never seen before. Tent cities are already sprouting up around the country and we’re going to see many more.”
“We’re going to start seeing huge areas of vacant real estate and squatters living in them as well. It’s going to be a picture the likes of which Americans are not going to be used to.
It’s going to come as a shock and with it, there’s going to be a lot of crime. And the crime is going to be a lot worse than it was before because in the last 1929 Depression, people’s minds weren’t wrecked on all these modern drugs, over-the-counter drugs, or crystal meth or whatever it might be..

So, you have a huge underclass of very desperate people with their minds chemically blown beyond anybody’s comprehension.
Above left, territorial boss ‘Humongous’ from movies. Right: territorial bosses- the Council on Foreign Relations.
Below left, citizen Mad Max, just struggling to stay alive from the movies. Below right, a suburban family with short term survival supplies. Reality.

The George Washington blog has compiled a list of quotes attesting to Celente’s accuracy as a trend
forecaster.
•  “When CNN wants to know about the Top Trends, we ask Gerald Celente.” – CNN Headline News
•  “Gerald Celente has a knack for getting the zeitgeist right.” – USA Today
•  “There’s not a better trend forecaster than Gerald Celente. The man knows what he’s talking about.” – CNBC
•  “Those who take their predictions seriously …consider. Gerald Celente and the Trends Research Institute.” – The Wall Street Journal
•  “Gerald Celente is always ahead of the curve on trends and uncannily on the mark … he’s one of the most accurate forecasters around.” – The Atlanta Journal-Constitution
•  “Mr. Celente tracks the world’s social, economic and business trends for corporate clients.” – The New York Times
•  “Mr. Celente is a very intelligent guy. We are able to learn about trends from an authority.” – 48 Hours, CBS News
•  “Gerald Celente has a solid track record. He has predicted everything from the 1987 stock market crash and the demise of the Soviet Union to green marketing and corporate downsizing.” – The Detroit New
•  “Gerald Celente forecast the 1987 stock market crash, ‘green marketing,’ and the boom in gourmet coffees.” – Chicago Tribune
•  “The Trends Research Institute is the Standard and Poor’s of Popular Culture.” – The Los Angeles Times
•  “If Nostradamus were alive today, he’d have a hard time keeping up with Gerald Celente.” – New York Post
So there you have it – hardly a nut job conspiracy theorist blowhard now is he? The price of not heeding his warnings will be far greater than the cost of preparing for the future now. Storable food and
gold are two good places to make a start.”

≈≈≈  ≈  ≈≈≈
While the future seldom unfolds the way we imagine, it may come in a  flavor that is not surprising. We may not know the exact height a tide may rise to on the beach, but we can certainly tell the direction the water is flowing; similarly, without seeing the wind, we can feel its pressure and see its effects. Even within a decade, the U.S.A may not experience literal secession as predicted by the Russian professor, but several regions may suffer patchy, severe economic depression, areas within other regions  may become wracked by moderate scale social/racial upheaval requiring federal military support…
.

“Dark clouds gather on the global horizon, the wind direction is changin’.
 Flashing light in the darkening sky, promise storms gale soon rising ”.
5-29-2011 Mr. Larry]

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Venezuela: Shortages and hyper inflation… How it looks on Main Street

news-desk[1]A. Venezuela Enforces Fingerprint Registry to Buy Groceries: What to Do Before Rationing Starts in America 2 April 2014, SHTFplan.com, by Daisy Luther, The Organic Prepper, http://www.theorganicprepper.ca/venezuela-enforces-fingerprint-registry-to-buy-groceries-what-to-do-before-rationing-starts-in-america-04022014

Pasted from: http://www.shtfplan.com/headline-news/venezuela-enforces-fingerprint-registry-to-buy-groceries-what-to-do-before-rationing-starts-in-america_04022014

Editor’s Note: In recent weeks the country of Venezuela has implemented everything from price controls to rationing in an effort to control the hyperinflation that has gripped the nation. All attempts at controlling demand and ‘hoarding’ have thus far failed, prompting government officials to issue directives requiring biometric verification for the purchase of foodstuffs. What’s happening in Venezuela is a clear example of how government first causes the problem, often leading to panic, and then points the blame at everyone but themselves. Officials claim that unscrupulous merchants (who have been forced to sell goods at prices lower than they have acquired them) and the hoarding of food by individuals is to blame for the shortages.

The solution, of course, is more government, and in this case that means registration of fingerprints and other personal data in exchange for permission to purchase food. Be assured that the same plans are in place right here in the USA. In fact, we already have an electronic mechanism of exchange in the form of Electronic Benefit Transfer (EBT) cards. Should the worst happen and the US dollar crashes at some point in the future, those who failed to prepare (or, hoard as the government would suggest) are destined to forced registrations at their local post office or other government entity. Daisy Luther of The Organic Prepper explains what’s happening right now in Venezuela, how a similar situation could unfold in the USA, and what you can do to prepare in advance.

For those looking to implement a frugal and highly effective strategy in advance of food shortages or currency crisis we suggest taking a look at Daisy’s book The Pantry Primer: How to Build a One Year Food Supply in Three Months.

Venesuela1(Pictured: Amateur photo: Venezuelans line up for miles in an effort to acquire food during hyperinflationary food shortages – March 2014)

.Venezuela Enforces Fingerprint Registry to Buy Groceries: What to Do Before Rationing Starts in America
By Daisy Luther

What if you were forced to “register” in order to buy groceries?  And what if, through that registration, the food you bought could be tracked and quantities could be limited?

That’s exactly the plan in Venezuela right now.  The AP reports that in an effort to crack down on “hoarding” that ID cards will be issued to families.  These will have to be presented before foodstuffs can be purchased.

President Nicolas Maduro’s administration says the cards to track families’ purchases will foil people who stock up on groceries at subsidized prices and then illegally resell them for several times the amount…

Registration began Tuesday at more than 100 government-run supermarkets across the country. Working-class shoppers who sometimes endure hours-long lines at government-run stores to buy groceries at steeply reduced prices are welcoming the plan.

“The rich people have things all hoarded away, and they pull the strings,” said Juan Rodriguez, who waited two hours to enter the government-run Abastos Bicentenario supermarket near downtown Caracas on Monday, and then waited another three hours to check out.

Checkout workers at Abastos Bicentenario were taking down customers’ cellphone numbers Monday, to ensure they couldn’t return for eight days. Shoppers said employees also banned purchases by minors, to stop parents from using their children to engage in hoarding, which the government calls “nervous buying.”

Rodriguez supports both measures.

“People who go shopping every day hurt us all,” he said, drawing approving nods from the friends he made over the course of his afternoon slowly snaking through the aisles with his oversized cart.

Reflecting Maduro’s increasingly militarized discourse against opponents he accuses of waging “economic war,” the government is calling the new program the “system of secure supply.”

Patrons will register with their fingerprints, and the new ID card will be linked to a computer system that monitors purchases. On Tuesday, Food Minister Felix Osorio said the process was off to a smooth start. He says the system will sound an alarm when it detects suspicious purchasing patterns, barring people from buying the same goods every day. But he also says the cards will be voluntary, with incentives like discounts and entry into raffles for homes and cars.

Expressionless men with rifles patrolled the warehouse-size supermarket Monday as shoppers hurried by, focusing on grabbing meat and pantry items before they were gone.

Last year in Venezuela, it became a crime to “hoard” food, and the country’s Attorney General called upon prosecutors to crack down on “hoarders” by imprisoning them for the “crime”.

Some people may read this and think to themselves, “Why on earth do I care about what happens in Venezuela?” You’d better care, because this is our future.

Already the Obama administration has moved the pieces into place on the board to be able to appropriate supplies from anyone, at any time.  Mac Slavo of SHTFplan warns: It should be clear from the laws that are already in effect that the government has given itself a legal pretext for confiscating anything they so choose in the midst of an emergency.

Should an emergency befall the United States, the military, national guard, and local police operating under orders from the Department of Homeland Security will have carte blanche to do as they please.

In a widespread emergency where supply lines have been threatened and millions of Americans are without essential resources because they failed to prepare, the government will swoop in an attempt to take complete control.

They will enter our homes and search them without a warrant. They will confiscate contraband. And they will take any ‘excessive resources’ that you may have accumulated. This includes food, toiletries, precious metals and anything else emergency planners and officials deem to be a scarce material.

Just think how much easier it would be to do so if every purchase you make is tracked and documented for future reference.

How Much of a Footprint Are You Leaving?
Now, think about those “loyalty cards” that every grocery store in North America promotes when you go through the checkout. Have you noticed how much more those are being pushed lately? Could there be a nefarious purpose to that?  I doubt the person at the cash register thinks twice about it – if these actually are data collection tools, it is something put in place by people far higher up the food chain (pun intended) than the staff of your local supermarket.

I strongly recommend you think twice about collecting “points” – the discounts may not be worth it if it means that your stock-up purchases are in some database, easily accessible to the NSA.  If you feel it is imperative to have one of those cards, consider using a pseudonym and false address.  You really don’t want to provide an inventory of your stockpile to the government. Some cards, like the one from Target, for example, even take it a step further and link to your credit card or debit account.  I can’t even wrap my brain around giving out that type of information to the person who rings up my paper towels and garbage bags.

To take this even further, if you haven’t been convinced yet that you need to begin producing your own food by gardening and raising micro-livestock, this should solidify the importance of not being totally dependent on “the system” for what you eat. Looking at the drought conditions across America’s farmland, is it a stretch of the imagination to think we could soon be facing rationing like that which is currently happening in Venezuela?  As the middle class gasps its last breath here in America, we may soon be faced with a situation where only the wealthy can afford to avoid rationing.  By becoming independent from the purveyors of food, you can assure that your family will not go hungry at the whims of a government who really doesn’t care.

Plan of Action
Here are a few things that you can do to pre-empt feeling the effects of a system like the one in Venezuela before such a change occurs on our own soil. Start now to leave less of a footprint for the government to follow.

  1. Plant a garden.
  2. Grow food indoors in sunny windows.
  3. Consider an aquaponics set-up in a spare room.
  4. Raise chickens and meat rabbits.
  5. Stock up NOW on long-term staples like grains and beans, before limits are instituted.
  6. Buy heirloom seeds – lots and lots of seeds.
  7. Practice careful OPSEC (OPerational SECurity) when making large purchases.
  8. Store long term food supplies in more than one location. That way if you lose some of your supplies to thugs (government or other varieties), you still have supplies to fall back on.
  9. Learn to preserve food.
  10. Stock up of preservation supplies like lids, jars, etc.
  11. Do NOT use so-called “loyalty cards” or memberships to make large purchases.
  12. When ordering large quantities of supplies, consider having them mailed to some place other than your home.
  13. Use cash or prepaid VISA cards purchased with cash to make large purchases.
  14. Don’t tell others about your supplies and purchases.
  15. Teach your children not to discuss things like food pantries and preparedness.
  16. Don’t store your supplies out in the open for anyone who comes into your home to see. Stash your 5 gallon pails away in closets, under beds, or in the basement.
  17. Disengage from the system by purchasing from small local farmers.
  18. Use the barter system whenever possible.  When money was tight and I lived in a place where I couldn’t grow much food, I worked on a farm harvesting vegetables in exchange for produce that I could preserve for my family.
  19. Change the way you eat – go with a local, in-season menu that is far more difficult to track than grocery-store purchased items.
  20. Learn to forage. Even in the city, you might be surprised at how many things can be found growing in your own back yard or falling off of the trees in a local park.  My children and I picked up one small bag of walnuts a day at a little park down the street one year, resulting in almost 15 pounds of shelled nuts by the time we were through.

Whatever your plan, don’t delay. We need only to read the many articles predicting a food shortage this year due to poor weather conditions to see the writing on the wall. You must become responsible for your family’s sustenance if you don’t want to suffer at the hands of those in power. I have no intention of standing in line for hours with my “ID card”, only to be allowed to purchase a small amount of highly inflated food.

[Please feel free to share any information from this article in part or in full, giving credit to the author and including a link to The Organic Prepper and the following bio.

Daisy Luther is the author of The Pantry Primer: How to Build a One Year Food Supply in Three Months.  Her website, The Organic Prepper, offers information on healthy prepping, including premium nutritional choices, general wellness and non-tech solutions. You can follow Daisy on Facebook and Twitter, and you can email her at daisy@theorganicprepper.ca

  .

B. Price controls and scarcity force Venezuelans to turn to the black market for milk and toilet paper
16 Apr 2015, by Girish Gupta in Caracas
Pasted from: http://www.theguardian.com/global-development-professionals-network/2015/apr/16/venezuela-economy-black-market-milk-and-toilet-paper

From those struggling to meet inflated prices for everyday goods, to lawyers turned pasta smugglers, the street economy flourishes under President Maduro

Venesuela vendorWith supermarket shelves empty, buhoneros (street peddlers) hustling everything from coffee to
shampoo are an increasingly common sight across Venezuela’s slums.  Photograph: Girish Gupta

In Petare, a giant slum overlooking Caracas from the east, hustlers known as buhoneros sell their goods at a busy intersection. “I’ve got milk, toilet paper, coffee, soap…” said 30-year-old Carmen Rodríguez, pointing to her wares by the side of a road busy with honking motorbikes, cars and buses. “Of course they cost more than the government say they should. We have to queue up to get them or buy them from someone who has done. We’re helping people get the basics.”

Yet, many of the poor simply can’t afford Rodríguez’s basics. In a raw and arguably necessary display of capitalism, she sells them for far more than the government’s legally required “fair prices”. It is ironically because of those government-imposed fair prices that the goods often aren’t available at supermarkets at fair prices as it’s simply not profitable to import them. This is thanks to economic policies dating back more than a decade.

Rodríguez sells each of her products for around 100 bolívares. At the black market currency exchange rate, that’s just 30 pence or so. But at that same exchange rate, the minimum wage in Venezuela is around £15 a month.

Venesuela2 queueA queue for a supermarket in Caracas. Photograph: Girish Gupta

“I can’t live like this, earning the minimum wage. It’s not enough at all,” said Araceli Belaez, 40, lining up for groceries at a supermarket in the Caracas slum of Catia.

Johan Elizandre is a fruit-seller in 23 de enero, a slum on the other side of Caracas. It overlooks the presidential palace and its walls are adorned with murals of leftist heroes such as Che Guevara, Karl Marx and former Venezuelan president Hugo Chávez. “A kilo of meat costs me 600 bolívares” said Elizandre, who earns 7,000 bolívares a month, around £20 when measured at the black market exchange rate – far more than the minimum wage. “I have sons, aged five and seven. I’d rather give them the food and not eat so much myself.”

Of course my goods cost more than the government say they should. We’re helping people get the basics

The scenes at Petare’s intersection, 23 de enero’s streets and Catia’s supermarkets are manifestations of an economy in tatters: one in which people buy milk, toilet paper and shampoo at inflated prices because supermarkets, with long queues outside, are near empty; in which engineers and lawyers smuggle pasta and petrol across borders to earn many times more than they would carrying out their profession; and in which surgeons complain that people are dying on the operating table because they cannot import medicines and equipment.

Venesuela3 queueThere will not be much left in the supermarket for people at the back of this queue Photograph: Girish Gupta

President Nicolás Maduro’s approval ratings are currently in the mid-20s. Annual inflation is at nearly 70% – which doesn’t include goods prices with the hefty premiums charged by the buhoneros like Rodríguez. The currency has fallen some 30% against the US dollar this year on the black market. And the murder rate is one of the world’s worst.

In 2003, Maduro’s predecessor Chávez enacted strict currency controls, pegging the bolívar to the US dollar. The aim was to reduce inflation and curb capital flight though neither has been achieved. Price controls, currency controls and the lack of dollars the government provides mean that importers no longer have the incentive to bring in goods. A thousand bolívares would have bought £30 on the black market when Maduro was elected to power in March 2013; it now buys less than £3. In the meantime, prices have risen rapidly while wages have not kept up.

On the country’s border with Colombia at San Antonio, engineer Jesús Arias, 33, has given up on his profession and smuggles petrol across the border. One of the country’s most costly price controls means that filling an entire tank costs just a couple of cents, converted at black market rates. Over the border, petrol sells for hundreds of times more. “Here petrol is practically a free gift,” Arias said. “A litre of mineral water costs more than a litre of gas.”

Children walk across the bridge to Colombia with Coca-Cola bottles filled with petrolThe subsidy costs the government around $12bn (£8bn) a year and Maduro is very clear that it needs to end – though that would be politically disastrous. Arias fills his 50-litre tank for just a few pence; a few hundred metres across the bridge in Cúcuta, Colombia, he can sell that for around £15. “Doctors, lawyers, architects, engineers we’re all doing it,” he said. “Here on the border, I can earn in three or four days what I earn as a professional in a month.” Children walk across the bridge with Coca-Cola bottles filled with petrol.

Maduro blames the problems on an “economic war” being waged against his government, with help from Washington. He blames smugglers, hoarders and street vendors for causing the problems rather than being a consequence of them.

Venesuela cash- barterPeople are leaving their jobs as they can make more as a black-market vendor. Photograph: Girish Gupta

Last year, the government tried to ban websites which publish the black market exchange rate, leading one blogger to liken the manoeuvre to banning the sale of thermometers to crack down on cold weather.

Yet, the black market, while imperfect, is offering an escape valve for the economy, a means for the poor by whatever means to obtain goods they would otherwise have to do without. “Repressing the black market rate, smuggling or trading is going to deteriorate the economic picture even further,” said Alberto Ramos, a senior analyst at Goldman Sachs in New York. “It will lead to even high inflation and higher levels of goods’ scarcity. The unofficial foreign exchange market and smuggling are to a large extent economic escape valves.”

(News & Editorial/ Venezuela: shortages and hyper inflation. How it looks on Main Street)

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Hubbert’s Peak Oil and the Hirsch Report

(Survival Manual/1. Disaster/ Hubbert’s Peak Oil and The Hirsch report)

(The Hubbert peak theory posits that for any given geographical area, from an individual oil-producing region to the planet as a whole, the rate of petroleum production tends to follow a bell-shaped curve. It is one of the primary theories on peak oil.)

I.  BACK IN THE 1950s
they saw it coming, we knew what it meant, it was ignored.

A.   M. King Hubbert – the first to predict an oil peak
In the 1950s the well known U.S. geologist M. King Hubbert was working for Shell Oil. He noted that oil discoveries, graphed over time, tended to follow a bell shape curve. He supposed that the rate of oil production would follow a similar curve, now known as the Hubbert Curve. In 1956 Hubbert predicted that production from the US lower 48 states would peak between 1965 and 1970.
Despite efforts from his employer to pressure him into not making his projections public, the notoriously stubborn Hubbert did so anyway. In any case, most people inside and outside the industry quickly dismissed the predictions. As it happens, the US lower 48 oil production did peak in 1970/1.
In that year, by definition, US oil producers had never produced as much oil, and Hubbert’s predictions were a fading memory. The peak was only acknowledged with the benefit of several years of hindsight.
No oil producing region fits the bell shaped curve exactly because production is dependent on various geological, economic and political factors, but the Hubbert Curve remains a powerful predictive tool.

In retrospect, the U.S. oil peak might be seen as the most significant geopolitical event of the mid to late 20th Century, creating the conditions for the energy crises of the 1970s, leading to far greater U.S. strategic emphasis on controlling foreign sources of oil, and spelling the beginning of the end of the status of the U.S. as the world’s major creditor nation. The U.S. of course, was able to import oil from elsewhere. Mounting debt has allowed life to continue in the U.S. with only minimal interruption so far. When global oil production peaks, the implications will be felt far more widely, and with much more force.

What does peak oil mean for our societies?
Our industrial societies and our financial systems were built on the assumption of continual growth growth based on ever more readily available cheap fossil fuels. Oil in particular is the most convenient and multi-purposed of these fossil fuels. Oil currently accounts for about 41% of the world’s total fossil fuel consumption, 33% of all global fuel consumption, and 95% of global energy used for transportation.
Oil and gas are feed stocks for plastics, paints, pharmaceuticals, fertilizers, electronic components, tires and much more.
Oil is so important that the peak will have vast implications across the realms of war and geopolitics, medicine, culture, transport and trade, economic stability and food production. Significantly, for every one joule of food consumed in the United States, around 10 joules of fossil fuel energy have been used to produce it.

B.  The ‘Hirsch Report’
A U.S. Dept. of Energy commissioned study “Peaking of World Oil Production: Impacts, Mitigation and Risk Management” [PDF] was released in early 2005. Prepared by Science Applications International Corporation (SAIC), it is known commonly as the Hirsch Report after its primary author Robert L. Hirsch. For many months the report, although available on the website of a Californian High School, remained unacknowledged by the DOE.
The executive summary of the report warns that: as peaking is approached, liquid fuel prices and price volatility will increase dramatically, and, without timely mitigation, the economic, social, and political costs will be unprecedented. Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking.
A later paper by Hirsch recommends the world urgently begin spending $1 trillion per year in crash programs for at least a decade, preferably two, before peaking. Obviously, nothing like the kind of efforts envisaged have yet begun. Hirsch was not asked to speculate on when the peak was likely to occur.
[In retrospect, the peak ocurred between 2000-2005; by 2011 we have quietly entered the decline phase. Although the West is in a double dip recession, gas prices have only slightly declined. Asian markets are absorbing production. Western commercial petroleum bulk storage is the lowest in years, while production cannot rebuild stocks to capacity. Its slow, its quiet. Who’s upset, yet? -Mr Larry]

C.  The Olduvai Theory
The theory is a proposed way of measuring industrial civilization by a single ratio – world annual energy use to population. The important idea is that, unlike previous civilizations which have risen and fallen to be replaced by others, industrial civilization would be the last because we would have used up all the easily obtainable resources (oil, coal, minerals) which are necessary for a civilization to form.
The theory is defined by the ratio of world energy production (use) and world population. The details are worked out. The theory is easy. It states that the life expectancy of Industrial Civilization is less than or equal to 100 years: 1930–2030.
World energy production per capita from 1945 to 1973 grew at a breakneck speed of 3.45%/year. Next from 1973 to the all-time peak in 1979, it slowed to a sluggish 0.64%/year. Then suddenly – and for the first time in history – energy production per capita took a long-term decline of 0.33%/year from 1979 to 1999. The Olduvai theory explains the 1979 peak and the subsequent decline. More to the point, it says that energy production per capita will fall to its 1930 value by 2030, thus giving Industrial Civilization a lifetime of less than or equal to 100 years.

The chart above is a graphic showing energy usage/population as a curve with various key points defined. These are:
Note 1: (1930) the beginning of Industrial Civilization
Note 2: (1979) all time peak of world energy production per capita
Note 3: (1999) the end of cheap oil
Note 4: (2000) eruption of violence in the Middle East
Note 5: (2006) all-time peak in world oil production
Note 6: (2008) OPEC crossover when more than 50% of oil comes from the OPEC nations
Note 7: (2012) permanent blackouts spread worldwide
Note 8: (2030) world energy production falls to 1930 level
The future dates may vary but it is easy to see how, with the knowledge we have of peak oil, the world could slip into a Medieval or even Stone Age scenario. Even a Dark Ages world would be difficult to sustain with no coal and little wood to burn. We are so dependent on energy that, unless we find some alternatives to hydrocarbon energy generation pretty quickly, we will find ourselves without the time or energy to switch.
.

II.  Predictions

Four Stages of Oil Depletion Through 2020
http://peakoilquestionoftheday.blogspot.com/p/life-after-crash.html
A.  World Oil and Natural Gas Liquids Production & Changes in each stage
Stage 1 (Now to end of 2011): World conventional crude oil and NGL production (CO&NGL) which is currently at 82 mbpd will remain stable with slight decline to 81 mbpd.
Continued economic stagnation with possible weak recovery, continued high unemployment will put little pressure on oil prices; gas prices will be generally stable. Non-OPEC production will begin to all off. Oil at $75 to $90 bbl; Gas at the pump in Dobbs Ferry $2.90 to $3.20.
Stage 2 (2012): Decline will accelerate in 2012 to 80 mbpd. Prices rises will become more pronounced, but still not seen as an emergency.
Global production fall off by end of year gets attention, markets respond with higher prices. Oil at $100 to $120 bbl; Gas at the pump in Dobbs Ferry $3.30 to $3.70. Economy continues to bump along in recession mode.
Stage 3 (2013 to 2015): Decline will be rapid in 2013 – 2015 with world production at 75 mbpd for CO&NGL by end of 2015.
Increasing fall off in production gets serious, news reports start talking about various causes — bad government policy, global conspiracy, return of “Drill, Baby, Drill”. Airlines cut back drastically as air travel becomes expensive. Demand for fuel-efficient cars soars. Government establishes crash programs to conserve, develop alternatives. Economy in terrible shape. By 2015 oil at $150 bbl; Gas at the pump at $6.00 to $10.00.
Stage 4 (2016 to 2020): by 2020 production will be 62 mbpd. Impossible to really estimate what prices will be. Life as we know it will be a memory.
Economy in shambles, oil prices continue higher.
By 2020 oil at $250+ bbl; Gas at the pump, when available, $15+.

B.  What will life be like once oil goes into decline. Here are a few things to expect.
1. Near Term Impact
__a) Continued economic decline with high unemployment. Without oil to fuel manufacturing, transportation, and food production, the only possible result is economic decline. Unemployment will continue to be high until people realize that they have no choice but to work for far less than they ever expected. Many of the unemployed will find work in agriculture as reliance on oil fueled machinery declines.
__b) Stagnant or declining stock market. Economic decline will inevitably impact the stock market and, as a result, the retirement savings of millions of Americans.
__c) Population move to urban areas/decline of suburbs. Who will want to (or be able to) live in a 4,000 square foot home 40 miles or more from work? The value of suburban housing (especially big houses) will decline as people try to get closer to urban centers and mass transit. Expect housing abandonment of the type already seen in California.
__d) Decline in construction, more people living together. As real income declines and construction costs increase, people will not be able to afford the square footage of living space they have become accustomed to. The migration from suburb to urban area, without additional construction, will mean more roommates, boarders, and houses cut up for rental.
__e) Air travel only for the rich. This is a no brainer. The airline industry is already in contraction. It won’t take much higher oil prices to push it over the edge.
__f) International trade declines.
__g) Deterioration of infrastructure as government revenues dry up.
__h) Increases in all prices — especially food and fuel.
__i) International conflict over remaining oil resources.
__j) Attempts by government to retain current lifestyle will fail and cause huge deficits, decline of currency.
__k) Solid waste disposal
2. Longer Term Impact
__a) more long distance transportation.
__b) Life becomes entirely local.
__c) Government breakdown.
__d) Social unrest.
__e) Population decline.
__f) Land becomes the main source of wealth.


 III. 
Preparing for Life in a Peak Oil World

23 January 2011, Oil Price.com, by Gail Tverberg
http://oilprice.com/Energy/Crude-Oil/Preparing-for-Life-in-a-Peak-Oil-World.html
“We know that peak oil will be here soon, and we feel like we should be doing something. But what? It is frustrating to know where to start. In this chapter, we will discuss a few ideas about what we as individuals can do.
1.  What will the first few years after peak oil be like? It is hard to know for certain, but a reasonable guess is that the impact will be like a major recession or depression. Many people will be laid off from work.
•  Gasoline is likely to be very expensive ($10 a gallon or more) and may not be available, except in limited quantities after waiting in line for a long time. Fewer goods of all types will be available in stores. Imports from third-world countries are likely to be especially unavailable, because of the impact of the oil shortage on their economies.
[Internet image right: Sanyo Enloop AA rechargeable batteries]
•  Gasoline prices may not rise as high as $10 gallon; the problem may be that at lower prices than $10 gallon, oil prices send the economy into recession. There may actually be a glut of oil supply because of recession or depression, because many cannot afford the high priced oil. For example, state highway departments cannot afford high priced asphalt. This is related to low “energy return on energy invested”. If the goods and services made with oil aren’t great enough to justify its high price, high oil price can be expected to send the economy into recession. Countries that use a lot of oil for purposes other than creating new goods and services are likely to be especially vulnerable to recession.
•  Money may not have the same value as previously–opinion is divided as to whether deflation or rampant inflation will be a problem. Investments, even those previously considered safe, are likely to lose value. Things we take for granted–like bottled water, fast food restaurants, and dry cleaners–may disappear fairly quickly. Electricity may become less reliable, with more frequent outages. Airplane tickets are likely to be extremely expensive, or only available with a special permit based on need.

2.  If a scenario like this is coming, what can a person do now? Here are a few ideas:
• Visit family and friends now, especially those at a distance. This may be more difficult to do in the future.
•  Learn to know your neighbors. It is likely that you will need each other’s help more in the future.
•  If you live by yourself, consider moving in with friends or relatives. In tough times, it is better to have others to rely on. It is also likely to be a lot cheaper.
•  Buy a bicycle that you can use as alternate transportation, if the need arises.
•  Start walking or jogging for exercise. Get yourself in good enough physical condition that you could walk a few miles if you needed to.
•  Take care of your physical health. If you need dental work or new glasses, get them. Don’t put off immunizations and other preventive medicine. These may be more difficult to get, or more expensive, later.
•  Move to a walkable neighborhood. If it seems likely that you will be able to keep your job, move closer to your job.
•  Trade in your car for one with better mileage. If you have a SUV, you can probably sell it at a better price now than in the future. [Internet image right: Mitsubishi or another make of small electric car.]
•  If you have two cars powered by gasoline, consider trading one for a diesel-powered vehicle. That way, if gasoline (or diesel) is not available, you will still have one car you can drive.
•  Make sure that you have at least a two-week supply of food and water, if there is some sort of supply disruption. It is always good to have some extra for an emergency–the likelihood of one arising is greater now.
•  Keep reasonable supplies of things you may need in an emergency–good walking shoes, boots, coats, rain wear, blankets, flashlights and batteries (or wind-up flashlights).
•  Take up hobbies that you will be able to continue in a low energy world, such as gardening, knitting, playing a musical instrument, bird watching, or playing cards with neighbors.
•  Join a local sustainability group or “permaculture” group and start learning about sustainable gardening methods.

3.  Do I need to do more than these things? It really depends on how much worse things get, and how quickly. If major services like electricity and water remain in place for many years, and if gasoline and diesel remain reasonably available, then relatively simple steps will go a long way.
Some steps that might be helpful to add once the crunch comes include:
•  Join a carpool for work, or make arrangements to work at home. If public transportation is available, use it.
•  Cut out unnecessary trips. Eat meals at home. Take your lunch to work. Walk or jog in your neighborhood rather than driving to the gym. Order from the internet or buy from stores you can walk to, rather than driving alone to stores.
•  If you live a distance from shopping, consider forming a neighborhood carpool for grocery and other shopping. Do this for other trips as well, such as attending church. If closer alternatives are available, consider them instead.
•  Plant a garden in your yard. Put in fruit or nut trees. Make a compost pile, and use it in your garden. Put to use what you learned in sustainability or permaculture groups.
•  Meat, particularly beef, is likely to be very expensive. Learn to prepare meals using less meat. Make casseroles like your grandmother’s, making a small amount of meat go a long way. Or make soup using a little meat plus vegetables or beans.
•  Use hand-me-down clothing for younger children. Or have a neighborhood garage sale, and trade clothing with others near you.

4.  Should families continue to have two, three, or four children, as they often do today? With the uncertainties ahead, it would be much better if families were very small–one child, or none at all. The world’s population has grown rapidly in the last 100 years. Part of the reason for growth is the fact that with oil and natural gas, it was possible to grow much more food than in the past. As we lose the use of these fossil fuels, it is likely that we will not be able to produce as much food as in the past, because of reduced ability to irrigate crops, and reduced availability of fertilizers, insecticides, and herbicides. In addition, manufactured goods of all types, including clothing and toys, are likely to be less available, with declining fossil fuel supply. Having smaller families will help fit the population to the available resources.
If couples have completed their families, it would probably be worthwhile for them to consider a permanent method of contraception, since birth control may be less available or more expensive.

5.  Are there any reasons why steps such as those outlined in Question 3 might be too little to handle the problem? Besides the decline in oil production, there are a number of other areas of concern. Hopefully, most of these will never happen, or if they do happen, will not occur for several years. If they do happen, greater measures than those outlined in Question 3 are likely to be needed.
•  Collapse of the financial system. Our financial system needs growth to sustain it, so that loans can be paid back with interest. Once peak oil hits, growth will be gone. Economic growth may even be replaced with economic decline. It is not clear our financial system can handle this.
•  Collapse of foreign trade. Many factors may come into play: The cost of transportation will be higher. Airline transport may not be available at all. Fewer goods are likely to be produced by the poorer countries of the world, because of power outages related to high oil prices. Rapid inflation/deflation may make monetary transactions more difficult.
•  Rapid climate change. Recently, scientists have discovered that climate change can take place over a very short period of time–as little as a decade or two. Temperature and precipitation changes may cause crop failures, and may make some areas no longer arable. Sea levels may also rise.
[Image right: Hot water and photovoltiac collectors on the roof of a private residence.]
•  Failure of the electrical grid. The grid tends to be vulnerable to many kinds of problems–including deterioration due to poor maintenance, damage during storms, and attacks in times of civil unrest. Maintenance is currently very poor (grade of D) according to the “Report Card on America’s Infrastructure” by the American Society of Civil Engineers. If we cannot maintain the grid, and upgrade it for the new wind and solar capacity being added, we will all be in the dark.
•  Water shortages. There are several issues–We are drawing down some aquifers at unsustainable rates, and these may be depleted. Climate change may reduce the amount of water available, by melting ice caps and changing storm patterns. City water and sewer systems require considerable energy inputs to continue functioning. If these are not provided, the systems will stop. Finally, systems must also be adequately maintained–something that is neglected currently.
•  Road deterioration. If we don’t have roads, it doesn’t matter whether we have cars. In the future, asphalt (a petroleum product) is expected to become more and more expensive and less available. It is not clear whether recycling asphalt from lesser-used roads will overcome this difficulty.
•  Decline in North American natural gas production. Natural gas is especially used for home heating, making plastics and making fertilizer. It is also used in electrical generation, particularly for extra load capacity when demand is high. Conventional natural gas is declining, and it is not clear that supply from other sources can make up the gap.
We now have shale gas and other unconventional making up the gap, but there are uncertainties how long it will stay with us.
•  Inadequate mineral supplies. A number of minerals are becoming less available, including copper (used in electric wiring), platinum (used in catalytic converters), phosphorous (used in fertilizer).
•  Fighting over available supplies. This could happen at any level. Individuals with inadequate food or gasoline may begin using violence. Or there may be fighting among groups within a nation, or between nations.

6. Are there any reasons for optimism? Yes. We know that people throughout the ages have gotten along successfully with far fewer resources than we have now, and with much less foreign trade. Financial systems have gotten into trouble in the past, and eventually new systems have replaced them. If nothing else, barter works.
We know that among the countries of the world, the United States, Canada, and Russia have reasonably good resource endowments in relation to their populations. They have fairly large amounts of land for crops, moderate rainfall, reasonable amounts of fossil fuels remaining, and populations that are not excessively large.
We also know that Cuba successfully made a transition from high oil usage to much lower oil usage, through the development of local gardens, increased public transit, and bicycles. A movie has been made about the Cuban experience.

7. What should we do, if we want to do more than described in Question 3? Some web sites (such as Life After the Oil Crash and wtdwtshtf.com) advocate moving to a farming area, buying land and hand tools, and learning to farm without fossil fuels. Typically, an individual purchases an existing farmhouse and adds solar panels or a windmill. The web sites generally recommend storing up large supplies of food, clothing, medicine, tools, guns, and ammunition, and learning a wide range of skills. These sites also suggest storing some things (liquor, razor blades, aspirin, etc.) for purposes of barter.
This approach may work for a few people, but it has its drawbacks. Making such a big move is likely to be expensive, and will most likely involve leaving one’s job. The individual will be alone, so security may be a problem. The individual may be dependent on his or her own resources for most things, especially if the farm is in a remote location. If the weather is bad, crops may fail. Living on the edge of a small town may prevent some problems, but such a move would still be a major undertaking.

8. How about Ecovillages? What are they? These are communities dedicated to the idea of sustainable living. These communities were set up in response to many issues facing the world, including global warming, resource depletion, and lifestyles that are not fulfilling. They were generally not formed with peak oil in mind.
Each ecovillage is different. Organizers often buy a large plot of land and lay out a plan for it. Individuals buy into the organization. Homes may be made from sustainable materials, such as bales of straw. Gardening is generally done using “permaculture”- a sustainable organic approach. Individuals may have assigned roles in the community.
The few ecovillages I investigated did not seem to truly be sustainable–they bought much of their food and clothing from outside, and made money by selling tours of their facilities. The ecovilliage approach could theoretically be expanded to provide self-sustaining post-peak oil communities, but would require some work. Some adventuresome readers may want to try this approach.

9. Is there a middle ground? What should people be doing now, if they want to do more than outlined in Questions 2 and 3, but aren’t ready to immerse themselves in a new lifestyle?
As a middle ground, people need to start thinking seriously about how to maintain their own food and water security, and start taking steps in that direction.

a) Food security. We certainly hope our current system of agriculture will continue without interruption, but there is no guarantee of this. Our current method is very productive, but uses huge amounts of energy. If we can keep our current system going, its productivity would likely be higher than that of a large number of individual gardens. The concern is that eventually the current system may break down due to reduced oil supply and need to be supplemented. Vulnerabilities include:
•  Making hybrid seed, and transporting it to farmers
•  Getting diesel fuel to the farmers who need it
•  Transporting food to processing centers by truck
•  Creating processed food in energy-intensive factories
•  Making boxes and other containers for food
•  Transporting processed food to market
[Internet image: Example of a way to grocery shop: Topeak trolley tote folding basket with groceries…also indicating that your home is located nearby a shopping district.]

If diesel fuel is allocated by high price alone, farmers may not be able to afford fuel, and may drop out. Or truck drivers may not be able to get what they need.
It is in our best interest to have a back-up plan. The one most often suggested is growing gardens in our yards–even front yards. Another choice is encouraging local farms, so that transportation is less of an issue. It takes several years to get everything working well (new skills learned, fruit trees to reach maturity), so we need to start early.
One type of crop that is particularly important is grain, since grain provides a lot of calories and stores well. In some parts of the country, potatoes might be a good substitute. It would be good if people started planting grain in gardens in their yards. There is a lot to learn in order to do this, including learning which grains grow well, how much moisture and nutrients the grains need, and how to process them. If the grain that grows well is unfamiliar, like amaranth, there is also a need to learn how to use it in cooking.
Individuals (or local farms) should also begin growing other foods that grow well in their areas, including fruits and nuts, greens of various types, and other more traditional garden crops, including beans. For all types of gardening, non-hybrids seeds (sometimes called heirloom seeds) are probably best for several reasons:
•  It makes storing seeds after harvest possible, and reduces dependence on hybrid seeds.
•  There is less uniformity, so the harvest is spread over a longer period.
•  The reduced uniformity also helps prevent crop failure in years with drought or excessive rain. Some seeds will not grow, but others will. (Hybrids are all or nothing.)
Imported foods are likely to shrink in supply more quickly than other foods. If you live in a country that is dependent on imported foods, you may want to consider moving elsewhere. [Farmers Market sales as seen in the picture above will not feed a community much less a city. Such sales seems to provide some sort of fuzzy safety net. The veggies look  so clean and healthy, but they are not an arithmatic solution (in lbs/person/year), but things could change, as they did in Cuba and North Korea, when the people got hungry. The problem is, following a crisis you have to ‘make do’ throught the next planting season to it harvest before the hopeful crop increase is realized.]

b) Water Security. Here, the largest issue is whether there is likely to be sufficient supply in your area. Another issue is whether there will be sufficient water for your garden, at appropriate times. A third issue is whether there will be disruptions in general, because of poor maintenance or because the process of treating fresh water (and sewage) is energy-intensive.
With respect to sufficient water in your area, if it looks like there is a problem (desert Southwest, for example), relocating now rather than later is probably a good idea. Transporting water is energy intensive, and new efforts at developing energy (like shale oil or more ethanol) are likely to make the water supply situation even worse.
With respect to water for gardening, consider a rainwater catchment system for your roof. Runoff water is saved in barrels, and can be used for irrigation in dry periods.
General disruptions of water supply are more difficult. Keep some bottled water on hand. You may also want to consider a tank for greater storage supply. Rainwater catchment can be used for drinking water, with the correct type of roofing (not asphalt shingles!) and proper treatment, but this is not generally legal in the United States.

10. What kind of investments should I be making? A person’s first priority should be buying at least a little protection for a rainy day – some extra food and water, comfortable clothing, blankets and flashlights. I suggested two weeks’ worth in Question 2. If you have money and space, you may want to buy more.
Paying down debt is probably a good idea, if only for the peace of mind it brings. There are some possible scenarios where debt is not a problem (hyper-inflation but you keep your existing job and get a raise). In many other scenarios (deflation; job lay-offs; rising food and energy prices) debt is likely to be even harder to pay off than it is now.
Land for a garden is probably a good investment, as well as garden tools. You will want to invest in gardening equipment, some books on permaculture, and perhaps some heirloom seeds. You may also want to consider a rainwater catchment system, to collect water from your roof.
You may also want to invest in solar panels for your home. If you want round-the-clock solar energy, you will also need back-up batteries. Buying these is questionable–they tend to be very expensive, require lots of maintenance, and need to be replaced often.
There is a possibility that the financial system will run into difficulty in the not-too-distant future. Some ideas for investments that may protect against this are
• Treasury Inflation-Protected Securities (TIPS). [At 69 years of age I recieve Social Security, its suppose to ‘inflation protected’. With the price of every thng going up at the store, doctor’s office and gas station, we haven’t received a COLA raise in two years. I’m afraid TIPS investors will  conveniently
encounter the same non inflationary ‘protection.-Mr. Larry]
• Bank accounts protected by the FDIC  [Where FDIC means– some of the same folks that brought us here today.]
Gold coins
• Silver coins

If you want to invest in the stock market, we know that there will be more and more drilling done for oil and gas done in the next few years, so companies making drilling equipment are likely to do well. Small independent oil and gas companies may also do well, doing “work-over” business. We know that there are likely to be shortages in some metals in the years ahead (copper, platinum, uranium), so shares in companies mining these types of metals may do well.
Investments in biofuels should be considered with caution. Most ethanol from corn appears to be heavily dependent on subsidies. If it should ever have to compete with other fuels on a level playing ground, it is likely to do poorly.
I would be cautious about buying insurance policies, except for short-term needs such as automobile coverage, homeowners coverage, and term life insurance. If we encounter a period of significant deflation, insurance companies are likely to fail, because bondholders cannot pay their debt. If we run into a period of rapid inflation, the life insurance or long term care coverage you buy may have very little real value when you come to use it.

11.  Should I move to a different location? There are many reasons you might want to consider moving to a different location:
• To find something less expensive. If times are going to be difficult, you do not want to be paying most of your income on a mortgage or rent.
• To be closer to friends or family, in the difficult times ahead.
• To share a house or apartment with friends or family.
• To be closer to work or public transportation.
• To be closer to a type of employment that you believe will have a better chance of continuing in the future.
• To have better fresh water supplies.
• To join a community with similar interests in sustainability.
• To leave a community that you feel may be prone to violence, in time of shortage.

There are disadvantages as well as advantages to moving to a new location. If many others are trying to move at the same time, you may not be welcome in the new community. You will likely not have friends and the support group you would have had in your prior location. Because of these issues, it is probably better to move sooner, rather than later, if you are going to move. If you balance the pluses and the minuses, it may be better to stay where you are.

12.  We hear a lot about various things we can do to be “green”, like buying fluorescent light bulbs. Do these save oil? Most of the “green” ideas you read about save energy of some kind, but not necessarily oil. Even so, they are still a good idea. If there is a shortage of one type of energy, it tends to affect other types of energy as well. Doing “green” things is also helpful from a global warming perspective. Here are some green ideas besides using fluorescent light bulbs:
•  Move to a smaller house or apartment.
•  Insulate your house, and have it professionally sealed to keep out drafts.
•  If any rooms are unused, do not heat and cool them.
•  Keep your house warmer in summer, and cooler in winter.
•  If you no longer need a big refrigerator, buy a smaller one. Be sure it is an “Energy Star” refrigerator.
•  If you have more than one refrigerator, get rid of the extra(s). Refrigerators are a big source of energy use. For parties, use ice in a tub.
•  Separate freezers are also big energy users. Consider doing without.
•  Eat less meat. Also avoid highly processed foods and bottled water. All of these require large amounts of energy for production.
•  Get power strips and turn off appliances that drain energy when not in use.
•  Turn off lights that are not needed.
•  Rewire lights into smaller “banks”, so you do not need to light up the whole basement when all you want is light in a small corner.
•  Get a clothes line, so you do not need to use your clothes dryer.
•  When cooking, use the microwave whenever possible.
•  Reduce air travel to a minimum. Air travel results in a huge number of miles of travel with corresponding fuel use.
•  Recycle whenever you can.
•  Eliminate disposables as much as possible (coffee cups, napkins, plastic bags, etc.)

13. Should we be talking to our local government officials about these problems? Yes! At the local level, there are many changes that would be helpful:
•  Laws permitting people to put up clothes lines in their yards.
•  Laws encouraging gardens to be grown, even in the front yards of homes.
•  Laws permitting multiple occupancy of houses by unrelated individuals.
•  New local public transportation plans, particularly ones that do not require large outlay of funds. For example, a plan that is more like a glorified car pool might work.
•  Allocation of funds to study the best crops to be grown in the area, and the best cultivation methods, if energy supplies are much lower in the future.
•  It would also be helpful to make changes at higher levels of government, but these are beyond the scope of the discussion in this chapter.”
“The phrase, ‘consent of the governed’ has been turned into a cruel joke. There is no way to vote against the interests of Goldman Sachs. Civil disobedience is the only tool we have left.” —Chris Hedges
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IV. Where we’ve been, where we are

Peak Oil
The world is rapidly approaching Peak Oil production and will be at an inflection point soon, if not already, after which, real prices will begin a long rise. Price inflection is possible before the next economic recovery, but will certainly come with a recovery, which will then be short lived, because rising energy prices will channel money away from other discretionary expenditures. For the last two years (2009-2010), the USA and Europe have been in recession with lower oil requirements, which have skewered the following 2007 chart by extending the plateau top and pushing the ‘decline in production slope’ (with subsequent increase in prices) into the future another couple years past the original 2007 projection.
Whether we are out of the recession or not by 2015 (within 4 years from now), production declines and the resultant rise in petroleum prices will probably have become an unpleasant factor in our national and personal, financial lives. On Saturday, 4 Sep 2010, FinancialSense.com weekly, ‘News Hour’ podcast, gave leads to the Peak Oil reports listed below. These articles seem to be telling a story, a story which has not yet been shared to any degree with the American people by either the US Government or the news media. Furthermore, there are almost monthly reports being issued by responsible, main stream institutions in Europe, the USA and the Middle East.
As I write, northern Europe is advancing on a program to greatly reduce their fossil fuel dependence; its estimated that in 10 years, by 2020, 20% of Europe’s energy, not just its electricity, will be derived from renewables.
What is happening in the United States? Nothing significant that I’ve heard, seen or read about. Maybe the government is waiting for a Peak Oil–Pearl Harbor type crisis to create a popular mandate for action, as opposed to making plans and choosing an intelligent path while there is time and opportunity to implement and mass test renewable systems.
The energy transition from one type energy to an alternative, historically, only happens about once per century and does so with momentous consequences. We will begin to move away from fossil fuels quite rapidly from here on forward. Business, families and individuals who can adapt to the charge and manage risk will gain an advantage with the shrinking energy pie. [Mr. Larry]

1)  February 2010: UK Industry Taskforce on Peak Oil and Energy Security (ITPOES) study on peak oil was released: “Business calls for urgent action on ‘oil crunch’ threat to UK economy
London, 10 February, 2010: A group of leading business people today call for urgent action to prepare the UK for Peak Oil. The second report of the UK Industry Taskforce on Peak Oil and Energy Security (ITPOES) finds that oil shortages, insecurity of supply and price volatility will destabilize economic, political and social activity, potentially by 2015. This means an end to the era of cheap oil.
•  Taskforce warns Britain is unprepared for significant risk to companies and consumers
•  Poorest to be hit hardest by price rises for travel, food, heating and consumer goods
•  New policies must be priority for whoever wins the General Election
•  Recommended packages include legislation, new technologies and behavior-change incentives
•  Fundamental change in demand patterns triggered by emerging economy countries

2)  March 2010: Telegraph.Co.UK, “Oil reserves ‘exaggerated by one third’
<http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/7500669/Oil-reserves-exaggerated-by-one-third.html>
The world’s oil reserves have been exaggerated by up to a third, according to Sir David King, the Government’s former chief scientist, who has warned of shortages and price spikes within years.
Published: 9:51PM GMT 22 Mar 2010, by Rowena Mason, City Reporter (Energy)
“The scientists and researchers from Oxford University argue that official figures are inflated because member countries of the oil cartel, OPEC, over-reported reserves in the 1980s when competing for global market share.
Their new research argues that estimates of conventional reserves should be downgraded from 1,150bn to 1,350bn barrels to between 850bn and 900bn barrels and claims that demand may outstrip supply as early as 2014. The researchers claim it is an open secret that OPEC is likely to have inflated its reserves, but that the International Energy Agency (IEA), BP, the Energy Information Administration and World Oil do not take this into account in their statistics.
It’s critically important that reserves have been overstated, and if you take this into account, we’re talking supply not meeting demand in 2014-2015.”
Dr Oliver Inderwildi, who co-wrote the paper with Sir David and Nick Owen for Oxford University’s Smith School, believes radical measures such as switching freight transport to airships could become common in future.
“The belief that alternative fuels such as biofuels could mitigate oil supply shortages and eventually replace fossil fuels is a pie in the sky. Instead of relying on those silver bullet solutions, we have to make better use of the remaining resources by improving efficiency.”

3)  March 2010: A heatingoil.com, Kuwait University and Kuwait Oil Company– Peak Oil report
Kuwaiti Researchers Predict Peak Oil Production in 2014
March 10, 2010,  by Josh Garrett
<http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/7500669/Oil-reserves-exaggerated-by-one-third.html>
“A new study published in the journal, Energy & Fuels, predicts that world conventional oil production will hit its peak in the year 2014. The study, undertaken by researchers at Kuwait University and Kuwait Oil Company (their chart shown above), looked at oil production in the top 47 oil-producing nations and found that humanity has extracted about 54 percent of total world oil reserves and that conventional oil production will reach its peak of 79 million stock tank barrels per day (an industry term, abbreviated as STB, that refers to the number of barrels of crude oil successfully extracted and “treated”) in about four years.
The study began with the Hubbert forecast model, named for peak oil pioneer M. King Hubbert, who successfully predicted that crude oil production in the US would peak in 1970. Though proven to be a useful tool in predicting peak oil, the Hubbert model has limitations when applied to more complex and diverse oil production methods and measures of the 21st century. The Kuwaiti researchers accounted for those limitations in the study, and also allowed for updates of their findings as new oil production data becomes available.
It should be noted that the study, no matter how sound its methods, reports exclusively on conventional oil (liquid crude that can be extracted from the ground relatively cheaply), and in doing so paints an incomplete picture of world oil supplies and the expected arrival of peak oil production.
(Note: If the study were to include data on unconventional sources such as Canada’s tar sands and oil shale deposits of the American West, the supply figures would grow substantially and the date of peak production would likely be pushed forward by at least a decade or two. However, because the technology and costs associated with extraction of unconventional oil vary widely and face an extremely uncertain future, it is logical that the study excludes unconventional oil figures.)
The more prepared governments and citizens are for any supply declines that could lead to rapid price increases in consumer fuels like heating oil, diesel, and gasoline, the less disruptive those increases will be to our daily lives.”
“Very few metro regions, cities or businesses are prepared for the impact of the global peak oil issue on their economies, or finances, operating budgets and mobility.
Cities, households and the economy will be impacted, as will industries. Some industries will be hurt (agriculture, retail, petrochemicals) and some sectors could be positively impacted (smart growth planners, alternative transportation providers, “smart city” technology providers, alternative fuel producers, mixed-use and infill developers)
Whether it’s bonafide peaking of global oil supplies, or a short- to medium-term “oil crunch,” the initial result will be the same. Rapidly rising gas prices and price instability should become evident by 2013, or even earlier if there are any supply shocks because of natural disasters (hurricanes in Gulf), political events, war and terrorists acts.
The most obvious area of impact of rising oil prices is transportation and mobility. During the gas price rises of 2006-2008, U.S. citizens turned to public transportation in record numbers. Light rail ridership was the biggest winner, as was an old and reliable form of gas-free transportation, the bicycle.
The biggest losers: SUVs (RIP Hummer) and personal automotive use. Across the nation, people substantially reduced their driving for the first time in decades, particularly in metro areas that had other mobility options.”

4)  April 2010: guardian.co.uk, “US military warns oil output may dip causing massive shortages by 2015” by Terry Macalister
<http://www.guardian.co.uk/business/2010/apr/11/peak-oil-production-supply>
“The US military has warned that surplus oil production capacity could disappear within two years and there could be serious shortages by 2015 with a significant economic and political impact.
The energy crisis outlined in a Joint Operating Environment report from the US Joint Forces Command, comes as the price of petrol in Britain reaches record levels and the cost of crude is predicted to soon top $100 a barrel.
“By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 million barrels per day,” says the report, which has a foreword by a senior commander, General James N. Mattis. It adds: “While it is difficult to predict precisely what economic, political, and strategic effects such a shortfall might produce, it surely would reduce the prospects for growth in both the developing and developed worlds. Such an economic slowdown would exacerbate other unresolved tensions, push fragile and failing states further down the path toward collapse, and perhaps have serious economic impact on both China and India.”
•  Shortfall could reach 10 million barrels a day, report says
•  Cost of crude oil is predicted to top $100 a barrel

The US military says ‘its views cannot be taken as US government policy’, but admits they are meant to provide the Joint Forces with “an intellectual foundation upon which we will construct the concept to guide out future force developments.”
The warning is the latest in a series from around the world that has turned peak oil – the moment when demand exceeds supply – from a distant threat to a more immediate risk.

Future fuel supplies are of acute importance to the US Army because it is believed to be the biggest single user of petrol in the world. BP chief executive, Tony Hayward, said recently that there was little chance of crude from the carbon-heavy Canadian tar sands being banned in America because the US military like to have local supplies rather than rely on the politically unstable Middle East.
But there are signs that the US Department of Energy might also be changing its stance on peak oil. In a recent interview with French newspaper, Le Monde, Glen Sweetnam, main oil adviser to the Obama administration, admitted that “a chance exists that we may experience a decline” of world liquid fuels production between 2011 and 2015 if the investment was not forthcoming.

“It’s surprising to see that the US Army, unlike the US Department of Energy, publicly warns of major oil shortages in the near-term. “The Energy Information Administration (of the Department Of Energy) has been saying for years that Peak Oil was “decades away”. In light of the report from the US Joint Forces Command, is the EIA still confident of its previous highly optimistic conclusions?”
The Joint Operating Environment report paints a bleak picture of what can happen on occasions when there is serious economic upheaval. “One should not forget that the Great Depression spawned a number of totalitarian regimes that sought economic prosperity for their nations by ruthless conquest,” it points out. From

5)  June 2010: Guardian.co.uk, news article posted 11 July 2010, “Lloyd’s adds its voice to dire ‘peak oil’ warnings”, by Terry Macalister
<http://www.guardian.co.uk/business/2010/jul/11/peak-oil-energy-disruption>
“Business underestimating catastrophic consequences of declining oil, says Lloyd’s of London/Chatham House report. One of the City’s most respected institutions has warned of “catastrophic consequences” for businesses that fail to prepare for a world of increasing oil scarcity and a lower carbon economy.
The Lloyd’s insurance market and the highly regarded Royal Institute of International Affairs, known as Chatham House, says Britain needs to be ready for “peak oil” and disrupted energy supplies at a time of soaring fuel demand in China and India, constraints on production caused by the BP oil spill and political moves to cut CO2 to halt global warming.
“Companies which are able to take advantage of this new energy reality will increase both their resilience and competitiveness. Failure to do so could lead to expensive and potentially catastrophic consequences,” says the Lloyd’s and Chatham House report “Sustainable energy security: strategic risks and opportunities for business”.
The insurance market has a major interest in preparedness to counter climate change because of the fear of rising insurance claims related to property damage and business disruption. The review is groundbreaking because it comes from the heart of the City and contains the kind of dire warnings that are more associated with environmental groups or others accused by critics of resorting to hype. It takes a pot shot at the International Energy Agency which has been under fire for apparently under-estimating the threats, noting: “IEA expectations [on crude output] over the last decade have generally gone unmet.”
The report the world is heading for a global oil supply crunch and high prices owing to insufficient investment in oil production plus a rebound in global demand following recession. It repeats warning from Professor Paul Stevens, a former economist from Dundee University, at an earlier Chatham House conference that lack of oil by 2013 could force the price of crude above $200 (£130) a barrel.
It also quotes from a US department of energy report highlighting the economic chaos that would result from declining oil production as global demand continued to rise, recommending a crash programme to overhaul the transport system. “Even before we reach peak oil,” says the Lloyd’s report, “we could witness an oil supply crunch because of increased Asian demand. Major new investment in energy takes 10-15 years from the initial investment to first production, and to date we have not seen the amount of new projects that would supply the projected increase in demand.”
And while the world is gradually moving to new kinds of clean energy technologies the insurance market warns that there could be shortages of earth metals and other raw materials needed to help them thrive. From

6)  August 2010: Spiegal Online International, posted 4 September 2010, “German Military Study Warns of a Potentially Drastic Oil Crisis“, by Stefan Schultz
“A study by a German military think tank has analyzed how “peak oil” might change the global economy. The internal draft document — leaked on the Internet — shows for the first time how carefully the German government has considered a potential energy crisis.
The study is a product of the Future Analysis department of the Bundeswehr Transformation Center, a think tank tasked with fixing a direction for the German military. The team of authors, led by Lieutenant Colonel Thomas Will, uses sometimes-dramatic language to depict the consequences of an irreversible depletion of raw materials. It warns of shifts in the global balance of power, of the formation of new relationships based on interdependency, of a decline in importance of the western industrial nations, of the “total collapse of the markets” and of serious political and economic crises.

The news report from Spiegal Online was specific about their study’s socio-economic findings, pointing out that:
1.  “Shortages in the supply of vital goods could arise as a result, for example in food supplies.
2.  Oil is used directly or indirectly in the production of 95% of all industrial goods.
3.  Price shocks could therefore be seen in almost any industry and throughout all stages of the industrial supply chain.
4.  In the medium term the global economic system and every market-oriented national economy would collapse.…
5.  (Relapse into planned economy) Since virtually all economic sectors rely heavily on oil, peak oil could lead to a partial or complete failure of markets. A conceivable alternative would be government rationing and the allocation of important goods or the setting of production schedules and other short-term coercive measures to replace market-based mechanisms in times of crisis….
6.  (Global chain reaction) A restructuring of oil supplies will not be equally possible in all regions before the onset of peak oil. It is likely that a large number of states will not be in a position to make the necessary investments in time, or with sufficient magnitude.
7.  If there were economic crashes in some regions of the world, Germany could be affected. Germany would not escape the crises of other countries, because it’s so tightly integrated into the global economy….”
8.  The Bundeswehr study also raises fears for the survival of democracy itself. Parts of the population could perceive the upheaval triggered by peak oil “as a general systemic crisis.” This would create “room for ideological and extremist alternatives to existing forms of government….”
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V.   The economy of extracting the last half of the oil

6th June 2010, MI2G, “Beyond Oil: Beginning of A New Era?”, London, UK
As the marginal cost of extracting oil has risen ever higher, it has been a red rag to the investment bulls seeking a return. Given that the risk profile of extracting that extra barrel of oil has now grown exponentially, this is likely to act as a new deterrent. The risks are rising much faster than previously anticipated as we approach peak oil.
The inertia which has set in amongst governments, businesses and the investment community in regard to preserving the status quo is going to be knocked sideways by the Gulf oil spill and as the costs of the cleanup mount, it will become imperative to invest in cleaner and safer forms of energy. The change in direction will ultimately be driven by a forced change in our collective value system. The end of oil-dependency is likely to mark the end of an era for the globalised western civilization’s model of oil-centric capitalism. If we survive, the age of oil will be followed by an age of recovery, restoration and a return to local generation of power through alternative means. What does the future look like without oil-dependency? Cleaner forms of energy are likely to proliferate. The possibility of a world in balance with natural resources, clean air, clean water, and with the natural environment, is like a shining light at the end of a dark tunnel.
If the problems were only the current recession, we’d muddle through and eventually it would end; if it were a matter of too much personal and national debt, we’d still muddle through, after increasing taxes and fees on everything and decade or so of unusually high inflation; if the problem were only Peak Oil, we’d muddle through, but with a sense of nervous urgency. However, combining, the recession, massive multi levels of debt and Peak oil is going to be taxing (pun intended), economically and socially exhausting.
It appears that global socio-economic systems are working their way deeper into a period of increasing stress. If there were no other major exogenous events to hit humanity over the next 5-10 years, we could probably pull off a global Manhattan type project of converting to renewable resources. An expansion of the ‘renewable energy’ paradigm would fuel manufacturing employment and consumer spending, banks would loan money, and for a short while there would be an economic boom, until the fallout from Peak Oil caught up. Our conversion from Oil to ‘renewables’ will not be fast enough to make up for the coming price hike in petroleum products. Look for the race from oil to renewables to be a ‘diminishing returns’ scenario, the more renewables we adopt, the higher energy prices go. Why? Because the problem is time related, we are starting too late to mitigate the coming Peak Oil price hikes.
So, even with the recession, massive debt and a late start at converting to renewable, we could with higher taxes and prices, come through with the current system intact, but jarred. Under these conditions the global economic system will be tight, there is little if any economic slack as we move forward through the recession toward Peak Oil. If an unexpected calamity arises, that could very well be the straw that breaks the camel’s back, resulting in serious, wide ranging population ‘hardships’.
[The term ‘hardships’ can cover a lot of unpleasant ground! Think about it. Name 10 inconveniences that could arise in your life from a national calamity, then throw in 10 unknowns you didn’t expect. Mr. Larry]
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VI. Energy: Shell’s future scenarios – Staring into energy’s black hole

6 Jul 2008, Author: Tobias Webb
http://www.climatechangecorp.com/content.asp?ContentID=5937
Shell’s “energy scenarios” see fossil fuels remaining a huge part of the energy mix to 2050. And if Shell is right, what does it mean for the planet’s future?

1.   Scramble scenerio
Under the Scramble scenario, the current and future “flight to coal” as a relatively cheap energy source cannot last forever. According to Bentham, in this scenario, around the mid part of the decade (ca 2014-2016) comes “a triple squeeze” in energy. This is made up of the logistical difficulties of having to move growing volumes of coal around the world. At the same time, conventional oil and gas supplies are likely to plateau because of a lack of investment and for “political issues” (shorthand for oil nationalism or a lack of big oil company interests in major projects).
These two factors could lead to the “demand levers being pulled rapidly”, Bentham said, and knee-jerk reactions by governments, such as reducing car speed limits to save on fuel use, decommissioning inefficient power plants quickly, and changing building regulations. All this, needless to say, is set to make the world a volatile place.
In Shell’s Scramble scenario, second generation (non-food sourced) biofuels will grow rapidly from 2020 onwards. Meanwhile, renewable energy sources, such as wind and solar, will see local growth but will not yet be able to compete with conventional energy in size and scale. The economic conditions of the 2020s will encourage further renewables growth, Shell says, and renewable energy will “rebound” by the end of that decade. The flip side will be that only by then will serious action be likely on global carbon prices as climate change related weather events begin to be blamed on a lack of action during the world’s previous dash to coal sources for energy. This rather paints a bleak picture for the future for environmentalists and, indeed, anyone else.

2.  Blueprints scenerio
Shell believes that its Blueprints scenario presents a much more positive picture. While the company does not believe that achieving a global balance of 450ppm of CO2 by 2050 or earlier is remotely feasible, Shell says that global energy demand can be met by less-polluting sources than fossil fuels, and can be reduced significantly by technology, driven by both regulation and collaboration between governments.
Bentham spoke of the “political reality” of climate change as a key driver for this scenario of collaboration on energy use. He cited two key examples: the law passed in California in 2006 which mandated a cap-and-trade carbon emissions trading system by 2012; and the recent attempts by politicians in Australia to distance themselves from their nation’s past recalcitrant attitude to the Kyoto Protocol and carbon dioxide emissions regulation.
The Californian approach has influenced other US states, Bentham said, noting that in the US, climate change is now “a Federal issue”, with both US presidential candidates saying that they take the threat seriously. Bentham said that the C40 group of cities around the world, which is sharing best practices on transport management and infrastructure development across borders, in both developed and developing economies, is another example of an emerging consensus around the need for collaboration to tackle energy and climate concerns.
Developing countries such as China, and their citizens, are also increasingly concerned about environmental issues and this may drive change towards cleaner economies much faster than in the past, Bentham claimed. China has far more UN-approved clean development mechanism greenhouse gas reduction projects than any other nation.

By 2012 to 2015, under the Blueprints scenario, Bentham thinks that we might see “a critical mass of carbon pricing being applied to a critical mass of sectors in a critical mass of countries”. While this rollout is not global, it begins to influence the choices that people are making in investments. This encourages technological progress such as carbon capture and storage by 2020, and vehicle electrification – by 2050 around 40 per cent of all ‘vehicle miles’ are electric under this scenario. National approaches begin to be harmonized, such as around carbon pricing. This encourages energy efficiency and wind power, while helping electric vehicles come to mass market in the 2020s.
CO2 emissions rise, plateau and then fall by around 2050, under Blueprints. Shell believes that there is no one solution to the global energy and climate conundrum, and that, according to Bentham: “Any technology that is going to be deployed at global scale in the next 50 years is already out of the laboratory.” It’s all about policy and incentive choices, he concluded, “the next five years are crucial”.

3. A third scenario: no fossil fuels
So what do others make of Shell’s predictions and dire warnings about the future of climate change and energy? Opinions are mixed.
“Shell is living in la la land,” says Mark Lynas, author of climate disaster bestseller Six Degrees: Our Future on a Hotter Planet. “They are constructing scenarios where they continue to be relevant as a fossil fuel company.” Lynas points out that the climate crisis is so serious that what he calls the “real world” will not tolerate such a high carbon vision of energy for 2050. “The whole scenario process should be about figuring out realistic outcomes and planning for them, whereas what Shell seems to be doing is deciding what they would most like to happen, and writing it down,” he says, calling Shell’s scenarios a “political exercise”.
Shell’s view that stabilizing global carbon emissions at 450 ppm is unrealistic is “totally irresponsible”, says Lynas. “If we don’t stabilize at way below 450 ppm we’ll see irreversible climate change with several tipping points being crossed as a result,” he argues. “They are obviously saying that the world can go fry and that their profits must come first.” Lynas believes that despite oil company claims that they can innovate around the frameworks set by politicians and prosper in a low-carbon world, the current large energy majors will eventually die off, as newer, hungrier firms replace them with what he calls “disruptive” energy technology.
David Strahan, author of The Last Oil Shock, says Shell’s best case analysis – Blueprints – is a “fairly disastrous scenario, because (by their estimation) coal is getting bigger as we go up to 2050”. Strahan notes that NASA’s Jim Hanson believes that if the planet managed to eliminate the emissions from coal-fired power stations by either closing them or capturing all the carbon, then “we squeak in at around 440 parts per million” of CO2. “What’s interesting about [what] Shell [is] saying [is] that it’s the end of the planet” if they are right, Strahan claims.

The carbon capture dream
Carbon capture and storage (CCS) is still largely wishful thinking, Lynas agrees. Right now only a tiny number of pilot projects exist around the world, with none being commercially viable. He is in favor of an upstream cap-and-trade system for carbon, which he says is “much easier to manage than regulating emissions” and should be discussed further. Under upstream trading systems, carbon is measured before consumers can become responsible for emitting it and effectively taxed heavily, creating energy efficiency and renewable energy investment incentives across the board.
While Lynas believes there is sufficient technology to decarbonizes power generation by 2050, he thinks it will have to come from renewable sources, with even nuclear a possibility, rather than from fossil fuels. He estimates that future scenarios should factor in a carbon price of €200-€300 a ton to make renewable energy power generation and transportation a reality by 2050. “We need to eliminate coal from the energy mix,” he says, noting that “nuclear may be a good option for China and India”.
“I think the scenarios are a good way of focusing policy makers’ attention on the progress we need to make,” says King. But she notes soberly that even with the considerable co-operation and technology implementation envisaged in Shell’s more positive Blueprints scenario: “We would not deliver the reductions that the climate science indicates we need. It is a useful reminder of the size of the challenge and the urgency.”

Scary future
A bleak message in many ways, but one that Shell appears increasingly comfortable offering – both as a wake-up call to others and to reassure shareholders of the company’s place in the future, after the firm was rocked in 2004 by a massive reserves accounting scandal and struggles to replace oil reserves.
Perhaps the most alarming two facts to emerge from Shell’s scenario planning are the uncertainty around predictions of future energy supply and the potential, or lack of it, of carbon capture and storage technology. No-one knows exactly when “peak oil” – the moment when more of the planet’s oil is out of the ground than left in it – will be reached and what the ramifications for global economics, unrest and politics will be.
Secondly, while many banks and energy firms say 2020 is the earliest when carbon capture and storage will be rolled out, the technology is still at its earliest stages. Unless massive investment in renewable energy is made over the next five to ten years, and if CCS is unable to decarbonize power generation from fossil fuels relatively quickly and on a commercially viable basis, the world will be short of low-carbon power options.
The fight between industry, with their hopeful ideas of carbon capture and storage technology, and those that want to see the whole planet shifting to renewable energy in the next two decades shows no signs of abating.

The peak oil problem
Shell predicts that global oil production will peak around 2020. But the company neatly side-steps the debate in its scenarios by predicting in both the Scramble and Blueprints scenarios that the decline rate of global production will be virtually negligible up to 2040.
David Strahan is surprised that Shell’s oil peak estimation is now 2020. “I haven’t heard them say that before,” he says. The world has already reached the beginnings of a global oil peak, he argues. “The facts are stark. The amount discovered has been falling for 40 years. For every barrel we find each year, we now guzzle three. Output is already falling in more than 60 of the world’s 98 oil-producing countries. And global oil production has been essentially flat, at just less than 86 million barrels per day, since early 2005. Serious analysts now forecast $200 per barrel.”

Blueprints or Scramble
Strahan believes peak oil is coming even earlier than Shell believes and will have a much faster decline rate in production than the company predicts. “Peak oil is this side of 2020”, he says. “Even if you take the most optimistic future discovery numbers that have any credibility and apply a little bit of common-sense you get a peak in 2017”. His fear is that global production will quickly descend to a 4 per cent annual decline rate sometime after that date. “That is the average decline rate of existing oil production capacity.
All major oil companies are struggling to replace their reserves and increase production, Strahan observes. Many are giving more money back to shareholders than they are spending on exploration and production combined, he claims. “They are basically liquidating themselves. Although the high oil price is giving them high profits for the time being, they are in trouble.”

[Did you understand that last statement (bold, brown text above)? After peak oil production, the rate of decline in oil coming to the market will quickly reach the standard average oil production DECLINE  rate of 4% a year. Every year there will be 4% less available oil in the market to sell, and for you, 4% less to buy.
Question: How can there be “growth” if every year there is 4% less work being done? How can we feed 2% more children born into the world with declining food production, when we already have a great deal of dislocation, warfare and starvation on the African continuent?
Since it takes 10 calories of energy input to produce and place 1 calorie of food on your table, if the energy input is declining so are the numbers of available food calories.
Of course there will be a couple years of belt tightening, which will briefly mitigate the food shortage in richer countries, but then with the energy continually declining 4% a year, the deficiencies add up fast: -4%, -8%, -12%, -16%, -20%….in less than 5 years we’ll be unable to hold back to flood tide of misery sweeping across the world, the country, into our homes. In 10 years there would be 40% less petroleum, in 25 years…..in less than 25 years, its all changed. Before 2034.
However, for now, (sadly said) if we can remain in a global recession for the next couple years that will push forward the ‘peak production’ inflection point a few months, while lower recessionary demand may or may not curtail price increases.
Your vote at the polls will not change this. Writing to elected officials or demonstrating on the street will not change this. The global population has voted, they are becoming increasingly concerned and now that they are becoming poorer, they are arming; some are hungry and many are angry, more are in the streets, but none will change the outcome. We are faced with classic ‘overshoot and collapse’.

In closing, a look back at a chart from the book, The Limits to Growth, © 1972, by the Club of Rome. The ‘limits to growth model’ data run is seen below, where there is a  cascading effect from the decline in (resources) oil production that spreads like falling dominos  across the variables, except death rate. The ‘establishment’ -governement, industry and finance, have found it economically convenient to ignore the concepts discussed by the Club of Rome, they did not heed the warning in Hubbert’s Peak oil or the Hirsch report; time passed and these ‘limiting factors’ have  quietly approached. Today, the leadership are ignoring the ‘peak oil’ reports made by various military, business and academic institutions…. Wake up, Neo!
Mr Larry]


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Filed under Survival Manual, __1. Disaster

Gettin’ by when supplies tighten

(Survival Manual/ 2. Social Issues/ Gettin’ by when supplies tighten)

A.  Report: Farmers Hoarding Food To Protect Against Currency Collapse
29 Apr 2013, SHTFPlan.com, by Mac Slavo
Pasted from: http://www.shtfplan.com/headline-news/report-farmers-hoarding-food-to-protect-against-currency-collapse_04292013
silo1

Which asset is more secure than money in the bank?
The answer is simple.
It’s the asset that will still have value when the money or the bank collapse.

All over the world, when people have been faced with the prospect of having their savings wiped out or confiscated they have turned to hard assets – physical goods they could hold in their possession and trade if necessary – as protection.

Argentina, a country that is no stranger to economic hard times and hyperinflation, gives us a prime example of what becomes money when the system collapses.

At an inflation rate of 25%, while their currency loses significant purchasing power, Argentines have made a mad rush into gold, silver, and other tangible goods that retain their barterable value.

Like many Greeks, who have headed to the countryside to grow their own food in the midst of complete economic destruction, farmers in Argentina are hoarding the one tangible investment they know will not lose value, no matter what their currency does.

With world food demand on the rise, growers in the Pampas grain belt are filling their silos with soy rather than converting their crops into pesos, a currency that hit a new all-time low in informal trade this week.

Considering Argentina’s high inflation, clocked at about 25 percent by private economists, “money in the bank” is not as secure as storing soybeans next to their fields, many say.
“We are going to hang onto our soy. One can see higher prices ahead,” said Jose Plazibat, a partner with the firm of Bandurria and Plazibat Brothers, which farms more than 3,000 hectares near the town of Chacabuco in Buenos Aires province.

With their currency in meltdown and food demand around the world rising, these farmers understand where real value comes from.
1.  Their food can’t be lost in the stock market.
2.  It’s intrinsic worth cannot be vaporized in a banking collapse.
3. And they do not need to wait for anyone to deliver it to them, as they hold it in their personal possession.

Hoarding commodities – not the paper receipts that represent your ownership, but the actual physical good – is a powerful diversification strategy, and one that is a natural response to times of uncertainty and government run amok:

Argentina is going through the classic stages of economic collapse.

The government seized all pensions. They are destroying everything that gives the people incentive to be a society that emerges from the cooperation of everyone.

When government turns against its own people, even as the USA is currently doing, you end up with deflation insofar as the economy collapses and wages are not available, while hoarding emerges as does barter.
……….source: Martin Armstrong

This strategy of buying commodities at lower prices today to consume at higher prices tomorrow can be implemented on a micro-economic personal scale in your own home. Doing so, especially with health and nutrition considerations, will not only provide you with long-term cost savings as global currencies continue to lose purchasing power, but insulate you against the possibility of a rush for food in the event of an emergency or widespread economic instability.

Whether you choose to stock your long-term food pantry by going to a grocery store, grow your own food in your traditional or aquaponics garden, learn to preserve it yourself, or prefer to do your own food storage packing, the key is to develop a plan and implement it now.

The US dollar isn’t getting any stronger over the next 10 years.
But the rice, beans, wheat, and pasta you stockpile will still have the same exact intrinsic value a decade from now as they do today.

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B.  Bartering Supplies That You Haven’t Thought Of; And Some You Have!
29 Apr 2013, American Preppers Network, by Jalapeno Gal77
Pasted from: http://americanpreppersnetwork.com/2013/04/bartering-supplies-that-you-havent-thought-of-and-some-you-have.html
gettin by tradeWhen I think of bartering supplies my mind automatically goes to a SHTF scenario.  There are a lot of lists out there for such scenes, but ultimately what you choose to barter is up to you.  Many people stock things like silver, gold, cigarettes or alcohol or coffee.  While these can be great items, they are also expensive.

I will admit, stocking up on cigarettes, coffee and alcohol do go against my health and religious beliefs, but it doesn’t stop me from storing it.  I would much rather barter an item that I will never use or need, than to barter precious items I do need.  In the end, what you decide to spend money on is your choice.

 Below is a list of items I feel would make good barter items if, and only if, I have enough extra to get away with it:
• 
Salt:  We store a LOT of salt.  It has multiple purposes and back in the day, people actually used salt as currency because it was considered such a high trade value and hard to find.  Salt can/was used to preserve food and it helps to eliminate the season availability of certain foods and allowed long distance travel.
• Toilet paper:  Take the cardboard out and put them in a large vacuum sealed bag storage bag.
• Kitty litter or dehydrated lime for sanitation or easy clean up of human waste in buckets.  Can you imagine what someone would trade for this?
• Matches/lighters
• Bleach
• Sugar
• Feminine supplies
• Flu/Cold Medicine
• Allergy Medicine
• Antibiotics/ Pain killers / fever reducer
• Bar Soap
• Seeds
• Toothpaste/toothbrushes
• First aid bandages
• Hydrogen peroxide (You could trade this by the cup or half cup.)
• We store small bottles of alcohol for trade.  We also have bigger bottles for refills if they want to bring it back for more.
• Coffee: We vacuum seal coffee in smaller portions with 1-2 coffee filters in each bag of coffee.  We also have 2 percolators to prepare the coffee if the person has no way to do so.
• Cigarettes: We do not store these but many people use them as barter items.
• Pipe Tobacco: Vacuum seal it to keep it fresh longer
• Spices
• Ramon Noodles: Very cheap and if someone is hungry then this would be good trade value.
• Beans: We stock the 15 bean soup because it comes with a spice packet in the soup.  You could trade these by the bag or by the cup depending on the size family they have or if it’s an individual.
• Razors
• Coats/Warm Clothing: We purchase used coats at goodwill and thrift stores.  All different sizes but especially kids coats.  These can be stored in large vacuum sealed storage bags and hardly take up any room.
• Small candles (or wax , wicks and wick tabs for making candles.)
• Chickens: Chickens produce meat and eggs, both of which people will want.
• Fly tape/mouse traps
• Pesticides
• gel, diapers, formula
• Socks/underwear
• Information on growing food or slaughtering animals.  You could print off some easy instructions and place them in binders.
• Fish hooks, weights, fishing line, bait
• Glow sticks
• Laundry soap powder
• Measuring spoons

These are just a few ideas to help you get started.  Notice, I did not put silver or gold on the list.  While this is a great item to have, I believe that if we are in a grid down situation, not many people are going to barter for something they cannot eat or use to stay alive.  Please don’t misunderstand me, it is alright to have these items for yourself, but for bartering, I just don’t feel it will be helpful in that area.

gettin by battery

[Mr. Larry ideas:
_a) If you develop or buy a 12 volt battery bank (several deep cycle 12 volt batteries) and a couple hundred watts of  PV panels (150-300 watts), solar charger,  inverter, and  a battery charger for AAA and AA rechargeable batteries, you would continue to use your personal electronics during a local disaster or SHTF event.
_b) Additionally, if you stock  an extra 50 to 100  AA and AAA Sanyo Enloop batteries, you would be set to operate a local “rent and recharge” battery service, thereby developing a “for food” customer base during a grid down scenario; it would only take recharging the batteries of maybe a half dozen families batteries to provide a significant portion of your “daily bread” or for the accumulation of other barter/trade items/services.]
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C.  40 Items to Barter in a Post-Collapse World
28 Aug 2012, Backdoor Survival.com, by__
Excerpt pasted from: http://www.backdoorsurvival.com/41-items-to-barter/

There are a lot of different opinions as to what items will be best for barter in a post-collapse world where the underground economy may be the only viable economy for the passing of goods and services.  That said, consider this a starting point as you begin to acquire goods for barter.

In no particular order, consider accumulating some of the following items for barter purposes.  And keep in mind that in a post-collapse world, the items do not necessarily have to be new, but simply serviceable.

  • Water purification supplies including purification tabs and filters, household  bleach.
  • Hand tools including hatchets, saws, machetes and general fix-it tools
  • Fire making supplies, including lighters, matches, flint fire steel
  • Sanitary supplies including toilet paper, feminine products and diapers
  • Disposable razors and razor blades
  • Fuel, any and all kinds (gas, diesel, propane, kerosene)
  • Prescription drugs, painkillers, and antibiotics
  • First aid remedies such as cough syrup, cortisone cream, boil-ese, calamine lotion and topical pain relievers
  • Spirits such as bourbon, rum, gin, and vodka
  • Coffee and tea (instant coffee is okay)
  • Solar battery charger and rechargeable batteries
  • Standard Batteries
  • Reading glasses
  • Paracord
  • Bags, including large garbage bags as well as smaller zip-close bags
  • Plastic sheeting
  • Duct tape
  • Tie Wraps
  • Heavy plastic sheets and tarps
  • Toiletries including toothpaste, dental floss soaps, shampoo (tip: save those small sized toiletries that are provided by hotels and motels)
  • Condoms
  • Latex or Nitrile gloves in a variety of sizes
  • Hard candy
  • Fishing supplies
  • Knives  of various types including fixed blades, kitchen knives, and box cutters.
  • Condiments and Spices
  • Paperback books on a variety of subjects
  • Tobacco and cigarette rolling supplies
  • Amusements such as playing cards, crossword puzzle books, Sudoku
  • Pencils & paper
  • Pepper spray
  • Garden seeds
  • Flashlights
  • Vinegar  and baking soda to use in DIY cleaning supplies
  • Empty spray bottles and squirt bottles
  • Hand pumps for both air and liquids
  • Mylar blankets and tents
  • Hand warmers
  • Sewing  and mending supplies
  • Knitting  or crochet needles and yarn

One thing you will notice that I have not included firearms or ammo and for good reason.  In a post-collapse society, you might not know your barter partners well and may run the risk that they will use these items against you so that they can steal the rest of you stuff.  One person’s opinion, anyway.

. .
C.  10 Forms of Currency if Paper Money Becomes Useless in Any Crisis.
18 Mar 2013, EmergencyHomesteader.com, by katalystman
Pasted from: http://www.emergencyhomesteader.com/10-forms-of-currency-if-paper-money-becomes-useless-in-any-crisis/

gettin by dollar burns

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gettin by PM & ammo

..gettin by water food.
gettin by seeds medical

.

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.gettin by liquor light

.

 

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gettin  by camping knowledge

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Filed under Survival Manual, __2. Social Issues

Our Future, Part 4 of 4

(Survival Manual/2. Social Issues/Our Future, Part 4 of 4)

Section VII  considers reactions to the Energy Descent Scenarios

A.  Global and Local Perspectives
Pasted from <http://www.futurescenarios.org/content/view/32/47/>
The scenarios as described are biased towards looking at the future for the billion or so relatively affluent persons who mostly live in the long industrialized nations mostly of Europe and North America but including Japan, Australia and New Zealand. For many people outside these countries the promise of benefits from global industrial culture are just that; promises. The general history tells of local and self reliant economies and communities decaying or collapsing as they are displaced by monetary economies, media and consumer ideologies. This is a process often associated with migration from rural to urban areas. The debate about the balance of benefits and disadvantages from these changes has been intense for thirty years.

Very few proponents or even critics of conventional economic development are yet considering energy descent scenarios, or the increased vulnerabilities to them which result from this loss of self reliance. Poor people crowded into barrios around super cities completely dependent on meager cash flows to maintain access to food and fuel are less able to provide for themselves when these systems fail. Five months in Latin America has given me cause to think deeply about these vulnerabilities that are already unfolding in many places where, compared to wages, fuel prices are ten times more than what they are in Australia.

It is not just the ability to cope with deprivation but more the pyscho-social capacity to accept life as it happens On the other hand one cannot experience life in many poorer countries without also considering how recent the changes have been. In many places people still know how to grow food and some cases can return to their home villages as soon as economic conditions suggest this will be more rewarding (even if it is only to labor on a relative’s farm) than hustling in the city for a dollar. Even when this is not possible, the sense of how resourceful and flexible people can be in what we might think extreme conditions, is a strength.

It is not just the ability to cope with deprivation but more the pyscho-social capacity to accept life as it happens without fixed expectation that lead to inevitable disappointment. While teaching a course in Mexico I was summarizing the energy descent scenarios session with reference to the house fire insurance analogy, that it was not necessary to believe your house would burn down to have fire insurance. The mostly middle class Mexicans laughed at my analogy because most Mexican homeowners don’t have fire insurance. It is this easy going acceptance of life that may be one of the characteristics that enables Mexicans to weather the storms that are surely coming.

In Australia many generations of steady growing affluence and high expectations have created a psychological and social brittleness.

On the other hand, in Australia and other long affluent countries, many generations of steady growing affluence and high expectations have created a psychological and social brittleness that suggests we may not weather the storms as well as we should. As a teenager I came to the conclusion that Australia was vulnerable to the attractions of fascism if and when social and economic conditions became much tougher. This early insight provided a foundation for the Brown Tech scenario.

In some nations, economic collapse and sustained conflict over the last few decades have simulated some aspects of energy descent. Most of the evidence is not good, with breakdown of law and order, food insecurity, falling life expectancy and mass migration. Russia, Argentina, Cuba, Zimbabwe and North Korea are examples of relatively affluent and industrialized countries that have experienced sustained conditions analogous to those possible from more general and global energy descent. An increasing amount of research and analysis within the Peak Oil network has focused on these countries to gain greater understanding of the hazards and opportunities of energy descent futures. Most notable is the Cuban experience that is remarkably positive and has provided a great boost to permaculture and other activists trying to show the opportunities from energy descent.

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B.  Cuba: Brown Tech, Green Tech or Earth Steward?
During the crisis of the “Special Period” in the early 1990’s the power of strong central government did not weaken, let alone fail. In some ways the government lead by Fidel Castro represents many of the elements of the Brown Tech world. On the other hand Cuba is not a very large country and can be considered as one bioregion with Havana as its capital so the scale of governance is more akin to that proposed for the Green Tech scenario. Further, many of the strategies for coping with the crisis from urban agriculture to bicycle and public transport are emblematic of the Green Tech scenario. Health and education statistics for Cuba also rule out the more severe conditions associated with Earth Steward, let alone Lifeboat. However while in Cuba in 2007 I became aware of some aspects of the crisis that did give insight into likely conditions in the more extreme scenarios.

During two trips in the countryside I observed extensive growth of Marabou (a spiny leguminous shrub) over large areas that appeared to have been farmland. The rapid spread occurred during the crisis and today cover about 20% of the farmland.  These species were previously common in the landscape mostly as a component of living fences and hedges. When the crisis hit, supplies of grains to feed the industrialized dairy industry collapsed and many of the dairy cows died in the dry season.

My hypothesis is that prior to dying, the cows would have eaten the dry pastures to bare ground and the living fences to sticks. The seeds of the Marabou consumed by the cows pass through in manure so in the succeeding wet season a complete crop of thorn shrubs would have emerged and dominated the recovering pastures. Despite the desperate need for food, the absence of fuel to plow the land for crops or resow pastures, allowed the shrubs to take over the land. This example illustrates how valuable resources can lie idyll in the face of desperate need.

The process of recovering the land from the thicket forests is a slow one even with better economic conditions but it also has produced benefits that are slow to be recognized. Increased carbon sequestration has been substantial and plant diversity and wildlife is increasing as the shrub legumes mature. The soil rejuvenating characteristics of these spiny legume shrubs may be building an asset that will be more valuable to Cuba as global energy descent begins to impact. Two low energy pathways to more productive and sustainable use of the land are possible. One is to use goats to reclaim the land back to pasture. Alternatively, accelerated succession to mixed food forest by selective seeding and planting could create agroforestry systems that continue to increase the woody biomass and food production both from fruit and nuts.

It is significant that both of these changes would require further changes in Cuban eating habits. This is connected to another sobering impression in the otherwise quite positive picture, that Cubans remained reluctant to change their traditional food habits even during the crisis and mostly have gone back to those habits after the crisis. The fact that a diet with less meat and dairy and a greater diversity of tropical vegetables, fruits and nuts could be more easily and sustainably produced will require continued efforts on many fronts and/or a longer cycle of deprivation to shift the deeply entrenched European food culture heritage in this tropical country.

Perhaps more relevant to countries with less government controls over the economy, Argentina provides some interesting examples of revitalization of local economies as central currencies and economies broke down, although most of these stopped once the monetary economy was re-established.

One of the uncertainties that emerges from reflecting on these examples of economic contraction is how different the situation will be when the dominant economic powers experience these problems. While this will create some more general global conditions it will also dramatically reduce the capacity to project power through globalization. Consequently we can expect conditions in local bioregions and nations to increasingly reflect the local resources, economy and culture, and be less driven by remote and global forces. As always this will precipitate new threats but also opportunities.

The next section considers how these scenarios can be both depressing and empowering, and can help us direct our energy towards positive change effectively.

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C.  Depressing and Positive Scenarios
Pasted from <http://www.futurescenarios.org/content/view/48/67/>
Another reaction to the scenarios by some participants on courses is that the Brown Tech scenario seems a depressing but realistic assessment of the situation in many affluent countries while the Green Tech scenario looks more utopian and unrealistic, but one that could be almost be “sold” as a desirable future by Green parties of western democracies.

The argument that the distributed power provided by resurgent rural economies will ameliorate the centralized and inequitable structures that lead to the Brown Tech world may be seen as a weak one, especially for people who are suspicious of the concept that fundamental energy and resources drive economic, social and political systems. Similarly the relative positive nature of Earth Steward compared with Lifeboat is partly predicated on the distributed rather than concentrated nature of resources and wealth (and of course the gift of a relatively benign climate).

We can better shape our responses to each of the scenarios if we recognize the constraining forces that are beyond our control.

It is possible to see some good and bad potentials, depending in part on our philosophical bent, in all four scenarios. Perhaps as an act of faith in human values and maturity, I believe we can better shape our responses to each of the scenarios if as individuals and as communities and nations we recognize the constraining forces that are beyond our control. We can then consider how basic human values and needs can be sustained without wasting resources on projects or objectives that may have little chance of altering the fundamental dynamics of our world.

Of course this reaction can be seen as negative, defeatist or even contributing to the realization of these undesirable scenarios. In the ad hoc internet community of Peak Oil activism that has sprung up the last few years, the divide between the “doomers” and the “optimists” has been a notable one. Since 2005 the worsening evidence on climate change has led to more of the experts in that field moving towards a “doomer” perspective on the climate front. Part of the process of moving beyond this simplistic and mostly counterproductive debate, is to see some of the positive potentials that exist in energy descent scenarios.

Permaculture activism has a long history of being informed by a negative view of the state of the world. But these perspectives drive an optimistic opportunity-based response.

Permaculture activism has a long history of being informed by a negative view of the state of the world. But these perspectives drive an optimistic opportunity-based response that can empower people to creative action and adaption in the face of adversity. The fact that permaculture activists privately and even publicly look forward to some aspects of these scenarios may be seen by some as naive or even immoral. On the other hand, an increasing number of people around the world find permaculture an empowering focus for ethical and practical action.

My recent experience from presenting the Energy Descent scenarios in Australia, New Zealand, Brazil, Cuba, Mexico and Argentina on permaculture courses as well as other gatherings of sustainability professionals, is that they can be very empowering, although I recognize the risk that they still pose, in triggering denial or depression and paralysis.

The next section considers how different regions look likely to tend towards different scenarios.

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D.  Different Scenarios in Different Places
Pasted from <http://www.futurescenarios.org/content/view/46/68/>
Australia and New Zealand provide examples of two very similar affluent countries in the South Pacific that may already be on very different trajectories and that reflect the dynamics of these scenarios. As the previous Prime Minister John Howard, proclaimed, Australia is one of the new energy superpowers. This claim is supported by the fact that Australia is the largest global exporter of coal, one of the largest exporters of gas with the seventh largest reserves, and has the largest reserves of uranium as well as many other minerals.

Australia exhibits the essential conditions for the emergence of the Brown Tech scenario. On the other hand climate change modeling suggests Australia is perhaps the most vulnerable of OECD countries, a vulnerability highlighted by the recent and continuing drought. These are the essential conditions for the emergence of Brown Tech. The “debate” about nuclear power initiated by the Australian government and the rush to build desalination plants and super-pipelines to address the water crisis are emblematic of this trend. The change of federal government to the Labor Party is likely to further concentrate power at the federal level and could lead to a more rapid abandonment of free market capitalism, further entrenching the Brown Tech scenario.

New Zealand looks like a strong candidate for Green Tech. New Zealand on the other hand has very little in the way of minable energy and resources, but, relative to its population, has extremely rich biophysical resources to support agriculture, forestry and renewable energies. The local impacts of climate change are predicted to be much less severe, allowing New Zealand to take advantage of these distributed rural resources. This looks like a strong candidate for Green Tech.

Without going into a detailed analysis of the emerging trends in the Australian and New Zealand economies and politics, it is sufficient to say Australia and New Zealand have been diverging for some time. This suggests that these underlying differences between the energy and resource bases of these two countries may have been contributing to the emerging differences at the political and even the social levels.

The next section looks at how planning for these scenarios occurs at different scales.

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E.  Stepped Energy Descent Pathways Linking the Scenarios
Pasted from <http://www.futurescenarios.org/content/view/51/73/>
As previously mentioned, energy descent may not be a continuous gradual process. Instead it could be characterized by an initial crisis that sets the conditions for a new order that is stable for some time before another crisis leads to further descent. The growth of energy and resultant technological complexity over the last two hundred years has involved varying rates of change, plateaus and even regressions during wars and depressions, but energy descent is likely to be much more variable than energy ascent. This is consistent with our common sense understanding that growth is a more consistent process than decline.

Natural ecosystems tend to maintain homeostasis under stress through the allocation of stored resources. If the conditions continue to deteriorate, then further stress can fracture the homeostasis. If the stress involves a reduction in energy availability, the system may collapse. But total collapse and system disintegration is rare, at least in the short term. More typically a re-stabilization at a lower level of energy processing and organizational complexity occurs. The new homeostasis will typically be stable for some time before declining energy availability precipitates another crisis. This may also be a model for how human societies respond to the crisis of resource and energy decline. It also makes sense that natural disasters, or a crisis such as war, rarely continue for very long but they shape the new state that emerges in their aftermath. If crisis does persist at an intense level for years then psychosocial systems reorganize around the crisis as the new normality.

The following conceptual graph shows these two pathways from Hubbert’s Peak of Oil (and net energy production). The discontinuities are periods of extreme crisis, conflict and/or breakdown. Each scenario represents a homeostasis that tends to be self-maintaining until further stress precipitates a further unraveling.

 ..

F.  Energy Descent Pathways
The red pathway is more extreme after continued growth leads to a precipitous drop through natural disasters, economic depression and/or war. Brown Tech emerges as the new world order allowing recovery and modest growth before further natural disasters/climate change and oil depletion precipitate another discontinuity leading to a Lifeboat world. The green pathway is less extreme with a lower peak and a gentler decline through the first discontinuity to the Green Tech scenario while the descent to Earth Steward is even more continuous driven by on-going depletion and decay of infrastructure from the Hubbert’s Peak and Green Tech worlds.

The chart also shows the relative levels of net energy availability per capita. This is much more speculative than the general concept of the stepwise descent or the relationships between the scenarios, because it depends on many variables. I’ve shown the Brown Tech and Lifeboat scenarios as processing more net energy per capita than the Green Tech and Earth Steward scenarios respectively. A range of factors contribute to this speculative maths, and hide some harsh realities. Depending on how net energy is understood and evaluated, a higher total energy base in Brown Tech may maintain greater organizational and technological complexity but Green Tech may be more energetically efficient at providing real human services.

A harsher discontinuity leading to Brown Tech may produce a higher death rate in the more urbanized populations while more severe controls on births may further reduce populations. The numbers of people the energy base needs to support strongly affects the per capita level so a higher per capita figure may reflect lower birth rates and/or higher death rates rather than a more energy rich society. Alternatively the lower death rate during the gentler discontinuity leading to Green Tech combined with a higher birth rate to tap the more distributed rural resources of the Green Tech world may result in overall higher populations. Although net energy per capita is lower, life may on average be better than in the Brown Tech scenario.

Similarly in the second discontinuity crisis, the death rate increases but more so in the red pathway to the Lifeboat. The lack of community capacity in the midst of massive material salvage opportunities, combine with the lower population, to deliver relatively high net energy per capita even though life is very harsh. The more abundant distributed renewable resources of the Earth Steward scenario leads to a higher birth rate (to tap those resources). Combined with the lower death rate, the higher overall population gives a very low net energy per capita. Efficient communitarian economies and a spiritual rather than material culture may make for higher wellbeing despite limited resources per person.

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G.  Nested Scenarios
Pasted from <http://www.futurescenarios.org/content/view/34/29/>
Yet another way to consider these scenarios is as all emerging simultaneously one nested within the other. The following figure shows the scenarios nested with their associated organizational and energetic scale. This suggests that the four organizational levels represented by the scenarios from the household to the national will all be transformed as global systems weaken and contract but none will fail completely. In a sense this is implicit in each scenario in any case and resolves the difficulty in imagining the Earth Steward and Lifeboat scenarios with a complete absence of city and national level power structures even if their functions and influence are very weak or attenuated away from the centers of power.

In explaining this on the afore mentioned course in Mexico, I suggested that in the Earth Steward and Lifeboat scenarios there could still be a government in Mexico city issuing edicts, but that no one, outside the much reduced city, would hear or take any notice. Like the reaction to my insurance example, my Mexican students laughed and suggested that no one took any notice of the government in Mexico now. This humorous response actually reflects an ongoing process of fragmentation in Mexico where autonomous movements in some regions and drug lords in others already rival the central and state governments in the provision of security, extraction of taxes and provision of services.

It is natural for national governments and large corporations to implement the systems that characterize the Brown Tech scenario. The other reason for considering that aspects of all scenarios will simultaneously emerge in all regions is the structural commitment of each level of governance to systems that can work at their respective levels. It is natural for national governments and large corporations to implement the systems that characterize the Brown Tech scenario because these systems are commensurate with the organizational scale in which they work. Similarly it is natural for city and bioregional (state) governments to implement the somewhat more distributed, diverse and smaller scale systems of the Green Tech scenario. Middle sized business using regional resources and serving regional markets will naturally work to reinforce this scenario.

[Energy Descent Scenarios nested by scale of related system]

 Any planning for Lifeboats is mostly a private activity of people who lack total faith in the stability of our economy and society Following this logic we can see smaller forms of organization (small business and local government) could manage many of the strategies applicable to the Earth Steward scenario while the household or closed community is the natural level of organization to contemplate the Lifeboat scenario. This nested hierarchy of scenarios explains why any planning for Lifeboats is mostly a private activity of people who lack total faith in the stability of our economy and society. Similarly many community activists work towards strategies that level the playing field, develop communitarian cultures and would be potent in an Earth Steward world, just as earnest middle level managers and planners work towards the Green Tech world as the best progressive evolution from what we have. Many of the elite “movers and shakers”, often from long established wealthy families in affluent countries, who move between the upper levels of corporations, governments and global governance organizations, believe the Brown Tech world is the hard reality that must be worked with (although this can hardly be acknowledged publicly).

I think this is one of the most insightful and empowering ways to think about these scenarios because it helps us understand the apparent contradictions between different perspectives and motivations of different groups in society and even contradiction within our own thoughts and behaviors. For example, it is common for people to have private thoughts about the Lifeboats or perhaps Earth Steward futures, while most of people’s public behavior as workers and consumers reinforce Brown Tech or perhaps Green Tech. The private thoughts are often internally critiqued as anti-social or at least naïve, while the public actions are often internally critiqued as driven by powerful outside forces. This nested model can help us better integrate these different aspects of ourselves.

Section VIII – The assumptions of current mainstream sustainability
efforts and  their relevance within the four Energy Descent Scenarios.
  

A.  Relevance of Mainstream Sustainability to Energy Descent
Pasted from <http://www.futurescenarios.org/content/view/47/69/>
Mainstream approaches to sustainability tend to assume stability if not expansion in the energy flows available to humanity even if there are major transitions in the nature of the energy sources. Consequently, continuity of many of the structures underpinning current social and economic systems is assumed.

For example, modern affluent urban life in a society dominated by service economies may be transformed by revolutions in efficiency but will remain the norm for future sustainable society. Further, it is widely assumed that food production and management of biological resources to provide for human needs will remain a minor part of future economies, and that geopolitical stability will allow globalised trade and other global governance regimes to become increasingly effective as instruments to establish sustainable systems.

These are not so different from the business as usual assumptions about constant growth, but they require not only herculean efforts to build a new energy infrastructure before energy becomes too expensive and unreliable, but also massively reducing our greenhouse gas emissions today, if not yesterday.

There is also the small problem of reforming the monetary system away from dependence on perpetual growth without inducing financial collapse. I say “small problem” with irony of course because growth in economic activity is essential to support the debt based currency which is the very foundation of our money and banking system stretching back to the beginnings of capitalism and its economic precursors.

For these reasons I feel the Techno Stability long-term future has even less prospects than the default future of Techno explosion. Maybe this also helps explain the deep resistance and antagonism in the centers of political and economic power to questioning of the logic of growth. Whether it comes from an ecological or sociological perspective questioning economic growth threatens the very basis of our economic system. The lip service to environmental sustainability – so long as it can maintain essential growth – reflects this understanding.

Consequently more idealistic notions of steady state green economics are automatically rejected as throwing the “baby out with the bathwater”. While I have been as critical of the concept of continuous economic growth as most environmentalists and scientists, I also recognize that attempts to avoid the ecological precipice by reducing economic growth could bring down the whole system just as Gorbachev’s Glasnost contributed to the unraveling of the Soviet system. The economic hard liners could be right. There is no way to stop the train of global industrial capitalism (other than by crashing).

[Relevance of Mainstream Sustainability to Energy Descent Scenarios]

Despite these doubts about the logic behind many mainstream approaches to sustainability, they have contributed greatly in spreading new environmental thinking. For example the Natural Step concept64aims to protect biophysical systems by creating closed loop industrial manufacturing through continual improvements in performance. It has been very influential in Scandinavia and has been adopted by some of the more progressive manufacturing corporations. Rapidly rising costs of energy and commodities will reinforce many of the Natural Step strategies but these will also increase the costs of adopting some of the more elaborate environmental technologies that have been used to ensure no contamination of natural or human environments.

Natural Step might work to some degree in the Green Tech world but would seem futile in the Brown Tech, technically and organizationally impractical in the Earth Steward, and meaningless in the Lifeboat. The vast majority of sustainability concepts and strategies to reduce ecological footprint and greenhouse gas emissions could be similarly analyzed as having uncertain relevance at best to energy descent scenarios.

In general, fundamental principles will have more utility than specific strategies and technologies The following table quantifies my view that mainstream approaches to sustainability have quite low relevance to energy descent scenarios. Low scores do not mean that these ideas will completely disappear but that they will tend to shift from their current status as the innovative cutting edge of the economy to reflecting a past era – rather than their objective of becoming the norm within a sustainable society. The table also shows that in general, fundamental principles will have more utility than specific strategies and technologies that are currently being applied as good examples of these concepts.

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B.  Examples of  Relevanced Principles

_1.  Renewable Energy Sources
Pasted from <http://www.futurescenarios.org/content/view/49/70/>
A good example of likely greater relevance of environmental principles when compared with specific strategies and technologies can be seen in relation to future energy sources. In fossil fuelled global industrial systems, energy supply has been generally concentrated in a few big powerful sources. A common principle in sustainability thinking is that a greater diversity of smaller and more distributed power sources will replace current fossil fuel, large hydro and nuclear sources.

The current roll out of wind power and to a lesser extent solar electric are technologies that illustrate this general principle and are widely recognized as central to the Techno Stability future. But energy descent may see growth in these particular energy sources slow or fail while older distributed sources such as wood and small scale hydro could grow rapidly. In a rapidly changing world appropriate design principles provide more guidance than specific strategies and technologies.

_2.  Biodiversity in Natural Resource Management
In the field of natural resource management the general principle of valuing biodiversity is likely to persist to some degree, at least in the Green Tech world, but the examples of vegetation management exclusively focused on local indigenous species, which are common today, will seem very dated as reflecting a world of rising wealth and constant climate.

Arguably, the principle of valuing biodiversity may even grow in strength as the current economic drivers favoring monoculture in agriculture and forestry weaken and are overtaken by viral forms of polyculture better able to use soil and water resources without inputs, and better able to serve mixed local markets. This process will allow the principle of valuing biodiversity to spread from the relative “cultural ghetto” of conservation management in affluent countries, to a more powerful expression of the permaculture version of the principle “Use and Value Diversity”. This very change may be experienced by those wedded to the current dominant views within the field of Conservation Biology as heresy to be resisted.

Energy descent demands that we consider more radical approaches to achieving environmental and social objectives.

[Relevance of Permaculture to Energy Descent Scenarios]

This is just one example of how energy descent scenarios will challenge some cherished beliefs within the environmental movement, while making others natural and obvious. Energy descent demands that we consider more radical approaches to achieving environmental and social objectives.
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_3.  Permaculture Design Principles
Permaculture as an environmental design concept with a long and evolving lineage of action around the world provides one such framework for developing new and reinforcing existing strategies that should be adaptive in energy descent scenarios.

In Permaculture: Principles and Pathways Beyond Sustainability, I explain the importance of design principles as the basis for generating new strategies and techniques in a world of change and uncertainty. The following table shows how permaculture, especially when it is understood through its design principles more so than currently applied strategies, has a closer fit with energy descent scenarios than many other sustainability concepts that have achieved more mainstream acceptance in affluent counties. While the numerical scores compared with those for “Mainstream Sustainability” can be taken with a grain of salt, the broad thrust is clear.

This table may reflect a claim of permaculture’s central relevance to energy descent, but it also suggests an equal challenge to permaculture educators, activists and designers to more effectively use design principles to identify strategies, techniques and working models that are tuned to emerging rather than past conditions.

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_4.  Meta-scenarios of Permaculture
Pasted from <http://www.futurescenarios.org/content/view/50/71/>
Each scenario presents quite different opportunities and challenges including ethical dilemmas for permaculture and related environmental and social activists. The analysis of the relevance of permaculture to the energy descent scenarios makes it possible to imagine meta-scenarios of how permaculture and related activism might influence society in ways different from today. Clearly these meta-scenarios are even more speculative than the energy descent scenarios, but provide a stimulus, especially for young people, to imagine oneself in the
energy descent future.

I imagine that permaculture – by principle and model, if not in name – will become the dominant paradigm in the Earth Steward scenario. I imagine that permaculture – by principle and model, if not in name – will become the dominant paradigm in the Earth Steward scenario. Those with a long track record of achievement will become the natural leaders within new emergent power structures, primarily at the local level, that will be more effective than higher levels of governance and organization. The ethical and design challenges will be those associated with leadership and power. Because “power” at this (and all levels) will be very weak, it will be more characterized by inspiration and wise council than the capacity to make binding decisions. Transparent and collaborative leadership that draws from the whole community and accepts slow evolutionary change and avoids the imposition of ideology is likely to be most effective in conserving resources and continuing to build a nature based culture.

•  In Lifeboats the focus of permaculturists is on provision of basic needs first and maintenance of seed and skills. Permaculture is also highly relevant to survival in the Lifeboat scenario. The focus on provision of basic needs first and maintenance of seed and other genetic resources and skills to salvage and ‘make do’ will all be essential. Those with considerable knowledge, skills and ability to provide for others, as well as having good communication and organization skills in difficult conditions, are likely to become natural leaders of lifeboat households and communities. The ethical and design challenges are less those of broader and collaborative leadership and more those represented by having to decide who to let into the lifeboat without threatening the survival of those already on board. The ability to integrate and defend the group without sentimentality while providing for the community and maintaining knowledge critical to long-term cultural survival, is the task of those able to think beyond everyday survival.

•  In Green Tech, the dominant paradigm is still focused in the economic and technological domains rather than the ecological. In the Green Tech scenario “sustainability” has become the dominant paradigm of more localized city and bioregional governance structures. Permaculture and related concepts have high status and receive resources from government and businesses to help further develop local food production and community economies that can buffer against further energy and ecological crises. For the permaculture activist this is a more familiar condition where there is ongoing, even rapid growth in influence but where the dominant paradigm is still focused in the economic and technological domains rather than the ecological domain as the source of wealth and meaning.

The primary ethical dilemma is that of comfortable co-option by the new sustainability elites, in the context of their heroic successes in avoiding the worst impacts of energy descent. Should permaculture activists quietly accept the status and resources that flow from these sustainability elites and focus on the slow change of society through practical works or should they critique the new elite for not accepting that energy descent will precipitate further crises unless we localize and simplify our economies further? The ability to lead by example and provide clear and persuasive articulation of values and goals beyond the prevailing mainstream lead to progressively more influence as the ongoing realities of energy descent unfold.

•  In the Brown Tech scenario the challenges for permaculture activists are somewhat analogous to those working in some poorer countries today. In the Brown Tech scenario, permaculture remains marginal to the mainstream, although it provides hope and some solutions for the increasing numbers of disenfranchised and alienated who reject, or are rejected, by the systems controlled by powerful central governments. The challenges for permaculture activists are somewhat analogous to those working in some poorer countries today; trying to assist the disadvantaged with simple technologies and solutions while avoiding threats from repressive central power.

Too much structure, organization and prominence could see such activism ruthlessly crushed as a threat to the system. Anarchistic and invisible modes of activism are likely to be more effective. Of course there are also those attempting to use ethical and design principles to reform the system from within (with all the attendant contradictions). Quiet and persistent collaboration between these two levels of activism could see a graceful descent to Earth Stewardship while failure could lead to the Lifeboat as the last option for the salvage of civilization.

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C.  Conclusion
Pasted from <http://www.futurescenarios.org/content/view/37/45/>
This exploration of energy descent scenarios has been an organic one which began with a didactic intention to highlight how large scale energetic and environmental factors shape history more than ideologies and the heroic actions of individuals. But my purpose was to empower those committed to ecological values and social justice to be effective in their quest to create the world we want, rather than just resist the world we don’t want. Finally it has become about telling a story that can help bring that world to life, an apparent contradiction to the premise I began with. Although the primary lesson about the large scale forces that control the course of history may be true for the long periods of stability, during periods of ecological and cultural chaos, small groups of people have been instrumental in those transitions.

In nature, disturbance events (such as fire, flood or drought) or eruptive disturbances from within an ecosystem, such as insect plagues or fungal disease, are often understood as examples of system dysfunction. Alternatively they can be understood as either initiating another succession cycle that brings renewed life or a novel force that deflects the ecosystem in different directions determined by the chance arrival of new species or other factors. The ecosystems that emerge from these periods of disturbance can be quite different from those that preceded them and these changes can be characterised from a systems ecology perspective as either degradation of biophysical resources and productivity, and/or ones involving new evolutionary pathways. The lesson from nature is that evolution of life works in strange ways that cannot be fully predicted.

The historian William Irwin Thompson’s67 interpretation of creation of the world’s “first university” by Pythagoras suggests similar processes at work when civilization finds itself in a cultural dead end or design cul de sac. Pythagoras had been an initiate of the Egyptian mystery schools that were part of a decaying theocracy in the 6th century BC. Pythagoras and his followers secularized some of the hidden and arcane knowledge but his school in Calabria was burnt to the ground in some local political dispute. Pythagoras died a broken man but his followers, the Pythagoreans fled to Greece where they found fertile social conditions for their ideas and values. This was the beginning of the flowering of classical Grecian culture that we recognize as the origins of western civilization. In a similar story Thompson describes how the penniless monks of Lindisfarne converted the British Isles to Christianity in the 6thcentury AD. They had no power but their spiritual message shaped to reflect the Celtic traditions, was transformative in a country in the aftermath of the collapse of the Roman empire and where no one any longer knew the function of Stonehenge. For a couple of generations a form of free anarchic Christianity provided spiritual meaning, but the monastery was burnt to the ground by the Vikings.

Like Pythagoras and the monks of Lindisfarne we live in a world of collapsing culture where we have to choose what is worthwhile at this great turning point in history. We are faced with the mixed pieces of the myriad of broken traditional cultures of the world and the novel and shining bits of unraveling industrial modernity. All of this will end in the dustbin of history. Our task is to choose which pieces of these jigsaw puzzles will be useful in creating an energy descent culture, the boundaries, features and colors of which, we can scarcely imagine. What is worth saving? What are the limits of our capacity? We have little time to decide and act. We must commit to concrete actions and projects. We must stake our claim, not for ourselves but for the future. In committing to our task we should remember the stories of Pythagoras and the monks of Lindisfarne. It is not the project but the living process that will be the measure of our actions.

Let us act as if we are part of nature’s striving for the next evolutionary way to creatively respond to the recurring cycles of energy ascent and descent that characterize human history and the more ancient history of Gaia, the living planet. Imagine that our descendants and our ancestors are watching us.

End of article: (Survival Manual/2. Social Issues/Our Future, Part 4 of 4)

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Our Future, Part 3 of 4

(Survival Manual/2. Social Issues/ Our Future, Parts 1-4)

Section V considers the interaction of peak oil and climate change to consider four distinct energy descent scenarios.

Descent scenarios 

A.  Scenario Planning
Pasted from <http://www.futurescenarios.org/content/view/26/40/>
The systems approach to the energy descent future can be taken further by using a scenario planning model that combines two fundamental, and largely independent variables that generate four scenarios, one for each of the quadrants of a conceptual graph. Scenarios in this context are plausible and internally consistent stories about the future that help organizations and individuals to achieve a broad and open-ended adaptability to inherent unpredictability.

In classic corporate scenario planning the two variables might be the growth rate in the wider economy and the regulatory framework that constrains or encourages business. Climate Change and Oil Production Decline are the variables I use as the primary drivers in creating the four energy descent scenarios because I believe these are the strongest forces shaping human destiny over the 21st century and beyond. Consequently they are central to consideration of the energy transition across nations and cultures and in both urban and rural environments.

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B.  Interaction of Peak Oil and Climate Change
Pasted from <http://www.futurescenarios.org/content/view/42/52/>
Although both variables are caused by collective human behaviour and potentially can be ameliorated by human behaviour, they arise from geological and climatic limits beyond human control. The debate over amelioration vs adaption to climate change is often portrayed as a potent moral choice between burning coal and accepting a changed world, or a shift to renewable energy to save nature. The emerging evidence suggests that this choice was one that humanity collectively fudged in the 1980’s.

Similarly the actions necessary to make an orderly transition from oil to other energy sources has been assessed as taking at least two decades. Again society had the evidence from the peaking of US oil production in 1970 but with the return of cheap oil in the 1980’s the energy problem appeared to have simply gone away due to “better” economic policies. Now climate change is accelerating and peak oil is upon us.

As well as having to adapt to both of these new realities, we also grapple with the interactions both positive and negative. The accelerating shift to increased dependence on natural gas is often portrayed as a positive reduction in carbon intensity but this is simply accelerating the depletion of our children’s remaining inheritance of high quality transport fuel. Similarly projects developing tar sands and other low-grade sources of oil massively increase greenhouse gas emissions. Perhaps more surprising to some, the huge push in the US and Europe to make biofuels from corn and oil seed crops is increasing land degradation, resource consumption and contributing to driving up the cost of grains and oil seeds. Many authorities are a warning of global famine due to climate and energy crisis factors (including biofuels) coming together. The low ERoEI of biofuels, especially corn-based ethanol, suggest biofuels may be a way to deplete natural gas while degrading agricultural land and starving the world’s poor.

[Chart showing Average Per Capita Energy consumption going forward from Peak Oil]

On the other hand, radical reductions in consumption due to transformative lifestyle change, creative reuse of wastes generated by industrial and consumer systems, and a shift to truly productive work within revitalised home and community economies, show how we can both build local resilience and capacity to adapt to the destructive change at the same time as we make the greatest contribution to reducing greenhouse gas emissions and fossil fuel depletion rates. While this strategy would be most productive and effective in the most affluent countries, it has increasing relevance world-wide.

The reluctance to seriously consider positive reductions in consumption in public debate about climate solutions could be swept away by the unfolding global energy and food crisis. Developing some of the harder and longer term ecological and modest technological adaption’s to ongoing and relentless energy descent will take decades to have widespread impacts (as do all high energy, high-tech centralized approaches) but radical and rapid human behavioral change is possible and even likely (given the right psycho-social conditions). The emerging energy and economic crisis will make these reductions a reality with or without a planned and creative response.

The alternate scenarios I have constructed provide more detail about how the Energy Descent future might evolve over the next few decades rather than the hundreds of the years of the long-term scenarios. As well as combining the effects of slow or rapid oil production decline, and slow or rapid global warming, they cover a very broad spectrum of human possibilities that can be recognized by various symptoms and signs in different places in the world today. They are all energy descent scenarios in that they depict possible futures with progressively declining net energy. This must be understood against the historical background in which energy use per capita globally has been on a bumpy plateau for thirty years after the previous thirty years of rapid growth per capita from the end of World War II. The graph below from the previously mentioned study suggests per worldwide capita energy use may continue to rise to about 1.7 tons of oil equivalent (toe) by 2020 before falling to 0.9 toe by 2050.

However when we use net energy ratios to convert these undifferentiated joules of energy, I believe that we are already into a global decline in net energy per person and will soon be into absolute global net energy decline.

C.  The Four Energy Descent and Climate Scenarios
Four Energy Descent scenarios are considered, each emerging from a combination of either fast of slow oil decline and either mild or severe climate change over the next 10-30 years:
1.  Brown Tech: (slow oil decline, fast climate change)
2.  Green Tech: (slow oil decline, slow climate change)
3.  Earth Steward: (fast oil decline, slow climate change)
4.  Lifeboats: (fast oil decline , fast climate change)

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D.  The Four Global Climate Change & Energy Descent Scenarios
Pasted from <http://www.futurescenarios.org/content/view/27/46/>
While the characterization of the four scenarios is difficult and inevitably speculative, they do provide a framework for considering how Peak Oil and Climate Change could interact to reshape global and local energy resources, settlement patterns, economy and governance. They also provide some insight into what could be effective responses for aware activists to secure their own and family’s future while contributing to society in a positive way. Those responses might include potentially effective policies that could be adopted by relevant forms of government that might be functional in each of these scenarios.
Finally they clarify the relevance of permaculture principles in a world of energy descent and focus our attention on the strengths and weaknesses of various strategies in adapting to the differing scenarios.
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Section VI considers the first scenario, Brown Tech.

1.  Brown Tech: Top Down Constriction
(Slow energy decline rates, severe climate change symptoms)
Pasted from <http://www.futurescenarios.org/content/view/28/48/>
The Brown Tech world is one in which the production of oil declines after a peak 2005-2010 at about 2% per annum and the subsequent peak and decline of natural gas is also relatively gentle, but the severity of global warming symptoms is at the extreme end of current mainstream scientific predictions. In this scenario strong, even aggressive, national policies and actions prevail to address both the threats and the opportunities from energy peak and climatic change. The political system could be described as Corporatist or Fascist (which Mussolini described as a merger of state and corporate power).

The tendency in existing systems for massive centralized investment by corporations and governments, give priority to getting more energy out of lower grade non-renewable resources (eg. tar sands, coal and uranium) and biofuels from industrial agriculture and forestry. “Breakthrough” technologies provide the constant promise of a better future but much of the investment in energy harvesting accelerates global warming, at least in the short term.

At the same time the cost of defending or replacing urban infrastructure threatened by storms and future sea level rise consumes more resources, while droughts and chaotic seasonal changes reduce food production from broadacre and small scale agriculture.

Flows of energy from more expensive sources such as tar sands, deep ocean oil, gas to liquids and coal to liquids slow the decline in fuels from crude oil. This transition requires a huge mobilization of the technical and managerial capacity held mostly by global corporations, along with the financial, legal and military security that only sovereign governments can provide. This resource nationalism by government  breaks down free trade and the faith in international markets that underpins the global economy.

By 2007, we had already seen the shift from a buyers to a sellers market for energy cascading through all commodities markets and reshaping geopolitical relations. The profits from both non-renewable resources and large scale industrial agriculture rise on the back of high commodity prices, reversing many of the economic patterns and trends of recent decades. The wealth of farmers and miners as well as corporations and nations in control of these resources increases even as depletion reduces the flows of resources and climate change causes chaos in farming and land management.

The demand for biofuels in affluent countries reduces world food stocks and raises prices to levels that result in famine and chaos in many poor countries unable to sustain subsidies for staple food. In other countries, food riots by the poor force government to pay for escalating subsidies. The wealth left over for education, health etc. collapses. Wars to secure fuel and food increase and refocus public attention on external threats. In richer countries, consumer led economic growth falters or is actively shut down by government policies to focus limited resources on food, fuel and climate security. Some type of global economic depression unfolds from the combined effects of high energy and food prices, superpower contest, resource nationalism and the fragility of the financial system.

Rapid onset of climate change also tends to support centralized nationalist systems for several reasons. First the consequences of chaotic weather, food supply problems, radical land use change and abandonment of marginal land, leads to demands for strong government action to protect people from high food and fuel costs, natural disasters, the consequences of strong action by other nations, and mass migration by displaced people. Rates of urbanization increase as climate change impacts and withdrawal of government supported services in more remote rural regions accelerates.

A decline of the middle class already evident in many western countries accelerates leading to discontent and suppression by government including internment camps either for migrants or homeless people. Strong approaches to population control, even forced sterilization are introduced in some countries.

A series of short but intense international conflicts confirm major shifts in global power balances while accelerating resource depletion. Control of non-renewable fossil fuel and mineral resources remains critical, while the (relative) importance of distributed renewable wealth from agriculture and forestry continues to decline as the climate deteriorates especially in my home country of Australia where greater severity of droughts hit hard. With food supply under threat, fossil fuels and other resources are redirected from personal mobility and consumption to intensive factory farming in greenhouses and other controlled environments, mostly clustered around urban centers and managed by agribusiness corporations.

Desalination and other high energy ways to maintain water supply systems are built at huge cost and further increase demand for energy. The threat of sea level rises leads to large scale urban redevelopment driven by strong government policies. Some very bold initiatives for energy efficient medium density urban development and public transport infrastructure are funded. A key characteristic of this scenario is the sense of divide between the reducing numbers of “haves” dependent on a job in the “system” and the relatively lawless, loose but perhaps communitarian “have nots” with their highly flexible and nomadic subcultures living from the wastes of the “system” and the wilds of nature. Security of the “haves” is a constant issue with gated communities, and apartheid style townships and barrios for the “have nots”. While economic depression and reduction in consumption slow greenhouse gas emissions, the rapid expansion of strategic investment by government in new energy and urban infrastructure more than replaces the reduced private consumption, leading to a positive feedback loop that accelerates global warming.
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[Photo: Left half of picture sprawling slums of  The Poor. Right half (beyond wall) with swimming pool terraced apartments, community pool and tennis courts of The Rich. Many wealthy neighborhoods in Brazil are gated and heavily secured to keep out the poor.  In many cases wealth and absolute poverty are only separated by a thin division as seen in the photograph above.

Pasted from <http://www.doctorhousingbubble.com/brazilian-style-living-in-southern-california-%E2%80%93-mls-inventory-creeping-up-section-8-vouchers-for-granite-countertops-and-california-budget-going-mayan-in-2012/>]

While the elites continue to be driven by a commitment to super rationalist beliefs, a sense of hollowness and lack of purpose characterizes the shrinking middle class, while fundamentalist religions and cults plays a stronger role in the lives of the working and unemployed classes partly through genuine reactions to the failures of modern humanism and partly manipulated by the elites to deflect anger and disenchantment. The Brown Tech scenario could be dominant and even more or less socially stable for many decades until ongoing climatic breakdown and reduced net energy return drive a shift to the Lifeboats scenario.

Top down constriction” summaries the essence of this scenario in that national power constricts consumption and focuses resources to maintain the nation state, in the face of deteriorating climate and reduced energy and food supply.
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2.  Green Tech: Distributed Powerdown
(
Slow energy decline rates, mild climate change symptoms)
Pasted from <http://www.futurescenarios.org/content/view/29/49/>
The Green Tech scenario is the most benign, in that adverse climate changes are at the low end of projections. Oil and gas production declines slowly as in the Brown Tech future, so the sense of chaos and crisis is more muted without major economic collapse or conflict. This allows resources to flow to a greater diversity of responses at the global, national, city, community and personal level. In some already densely populated poor countries, conditions worsen.

However higher commodity prices allows some poorer producer economies to escape their debt cycle while programs to empower women result in rapid reduction in the birth rate. The gradual reduction in capacity of countries to project power globally due to rising energy costs, increases national security and redirection of resources away from defense and resource capture to resource conservation and technological innovation. The consolidation of the global communication systems maintains global outlooks and understandings if not global economics.

As in the Brown Tech scenario, electrification is a key element in the energy transition but the renewable energy sources of wind, biomass, solar, hydro, tidal, wave etc. grow rapidly developing a more diverse and distributed mix. The relatively benign climate allows a resurgence of rural and regional economies on the back of sustained and growing prices for all natural commodities including feedstock for biofuels.

The principles behind organic agriculture and ecological management and resource allocation become the norm in many farming systems, helping to stabilize agriculture challenged by increasing cost of energy inputs and (albeit mild) climate change.

The accelerating conflict between biofuels and food is stabilized if not resolved by government subsidies to support food supply from agriculture, with biofuels coming mainly from forestry wastes. In many regions with prime agricultural land and small populations, wealthy farmers and agribusiness corporations are the main beneficiaries employing both high technology and cheap labor from migrant workers. In some regions, with poorer and steeper land and more diversified land ownership, smaller scale polyculture systems designed using permaculture principles spread wealth more evenly through local communities.

Continuous contraction affects large sections of the economy but the energy, resource and agriculture sectors along with recycling and retrofit industries experience rapid growth based on high commodity prices that are sustained despite economic recession in the main consuming economies. In some affluent countries, reform of monetary systems lowers the scale of financial collapses and refocuses capital on productive and socially useful innovation and investment.

Information technology continues to yield gains in energy and resource management; from real time pricing and self-healing electrical grids, to internet based ride sharing systems and telecommuting. Conservation yields the greatest gains with major public policies to change personal and organizational behavior. In other countries, especially the USA, the apparent opportunities for continued economic growth, combine with political policies to support a low carbon economy, leading to a renewable energy investment bubble followed by a severe recession.

State and city governments responsible for providing services are able to lead much of the restructuring to more compact cities and towns with increasing public transport infrastructure. Growth in large cities (especially in coastal lowlands) is reversed by public policies ahead of the worst effects of energy cost and global warming, while regional cities, towns and villages see modest growth on a compact urban model that preserves prime agricultural land and develops mixed use neighborhoods with more local work and radically less commuting.

The placing together of many of the more optimistic aspects of energy descent may seem artificial, but there are reasons to believe that the Green Tech scenario will tend towards a more egalitarian structure with the relative shift of power from control of oil wells and mines to control of the productivity of nature via traditional land uses such as agriculture and forestry and more novel renewable technologies.

The inherently distributed nature of these resources will lead to more distributed economic and political power at the level of cities, their hinterlands and organizations focused at this scale. For example, successful large scale farmers who have reduced their dependence of energy intensive inputs through permaculture strategies and organic methods may find new profits in more localized markets with prices sustained by policies that encourage regional self reliance. Any profits beyond farming are likely to be invested into local energy systems that generate more employment and further reduce economic dependence on central governments and large corporations. It is possible that these same processes could lead to highly inequitable, even feudal systems. However the universal focus on more sustainable production and reduced consumption that is not forced by remote and arbitrary central power, has the tendency to foster more egalitarian responses than in the Brown Tech scenario.

The substantial reductions in greenhouse gas emissions that result from this scenario keep climate change impacts to a minimum, thus stabilizing and reinforcing the scenario’s basic characteristics for at least several decades.

The success in radically reducing consumption of resources while sustaining modest growth in some local economies combined with stabilization of the climate, encourages a new “sustainability” elite to consider further changes to consolidate these achievements in the face of ongoing net energy decline. The worse excesses of consumer capitalism are controlled by restriction and reforms of advertising and other dysfunctional forces.

Civic culture strengthens where further transition towards a non-materialistic society combines with the maturation of feminism and environmentalism, and a resurgence in indigenous and traditional cultural values. These trends stabilize the accelerating loss of faith in secular humanism allowing the evolution of more spiritual “cultures of place”. Over time an evolution toward the Earth Steward scenario seems an obvious and natural response to the inexorable decline of non-renewable resources. “Distributed Powerdown” summarizes this scenario by emphasizing both the distributed nature of resources and power, and the planned contraction involved.

At their extremes the Green Tech and Brown Tech scenarios also describe many of the elements that could be expected in the Techno Stability Long Term Scenario where new energy sources manage to replace fossil fuels without the stresses that lead to system wide contraction. The current levels of ecological, economic and socio-political stress are the indirect indicators that we are entering the energy descent scenarios rather than simply a transition from energetic growth to stability. Relative insulation from those stresses and the persistence of faith in the monetary accounting “house of cards” by the upper middle class (if not the global elites) continues the confusion. The lack of understanding of net energy accounting and disagreement amongst the experts on appropriate methods, combined with political pressures from the unfolding crisis lead to energetic descent being mistaken for “business as usual”.

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3.  Earth Steward: Bottom Up Rebuild
(
Rapid energy decline rates, mild climate change symptoms)
Pasted from <http://www.futurescenarios.org/content/view/30/50/>
In this scenario the decline in oil production after a peak in total liquids production before 2010 is at the extreme end of authoritative predictions (about 10%) and is followed by an even faster decline in gas production plus a simultaneous peak in coal production. The shock to the world’s fragile financial systems is overwhelming, resulting in severe economic depression and perhaps some further short, sharp resource wars.

This economic collapse and these political stresses, more than the actual shortage of resources, prevents the development of more expensive and large scale non-renewable resources that characterize the Brown Tech scenario or the renewable resources and infrastructure of the Green Tech. International and national communications networks break down.

Electricity grids become non-functional as cost and availability of fuels and spare parts reduce production and lack of paying businesses and customers reduces revenues. International tensions remain but capacity of stronger countries to use military force is constrained by unreliable energy and parts supplies and the strong evidence that war uses more resources than it captures. Global warming is slowed dramatically and reversed by the collapse of the global consumer economy and absence of large scale investment in new energy infrastructure.

There is a radical reduction in mass mobility of both people and goods. The food supply chain is severely affected both on farms and through the distribution system. Energy intensive large scale farming supplying central marketing chains is the worst affected leading to abandonment of even highly productive land. Shortages lead to rationing, black markets, and riots for food and energy.

Increases in crime, malnutrition and disease lead to a rising death rate accelerated in some countries by epidemics and pandemics that have a major impact on social and economic capacity. The collapse in the tax base available to national and state governments reduces their power and even city level restructuring of infrastructure is difficult, but local government retains some degree of effective services, decision making and possibly democracy.

Collapse of larger businesses and the difficulties in maintaining urban infrastructure leads to a hollowing out of the cities. Loss of jobs and houses leads to migration of people out of cities to smaller towns, villages and farms with more robust local economies able to take advantage of the influx of labor. Impacts and demands on local soil, water and forest resources increases, to severe levels in many poor countries as people move out of the cities to harvest fuel, wildlife and restart food production. In long affluent countries, the underuse of local biological resources in the late 20th century provides some buffer against these impacts.

Large numbers of homeless exurbanites form a new underclass lacking even the skills of poverty.

Large numbers of homeless ex-urbanites form a new underclass lacking even the skills of poverty. They provide basic labour in exchange for food and accommodation on farms needing the labour. Surviving structures of power may adapt to impose a more feudal structure based on concentrated control of productive farms and forests and built assets in large farming estates.

Organic and small farmers, close to markets and able to make use of labour and animal power, thrive (to the extent security allows) in a context of relatively benign and slow climate change. An explosion of home businesses based on building and equipment retrofit, maintenance and salvage starts to build a diversified economy. Further afield biofuels from crop waste allow farmers to continue to use machinery while wood and charcoal gasification based on regrowth forest resources near settlements and towns provide an increasing proportion of limited transport fuel. This small business growth in turn provides a new tax base for some form of effective local government. In some places new bioregional governments institute land reform and debt cancellation following collapse of financial institutions and central banks, allowing people to stay on their properties.

Suburban landscapes around smaller cities and regional towns with greater social capital are transformed with a booming and relatively egalitarian society sustained by bio-intensive/permaculture farming and retrofitting and reuse supported by resources from both the immediate rural hinterland and inner urban salvage.

This ruralization of suburban landscape to produce food on all available open space, private and public provides most of the fresh fruit and vegetables, dairy and small livestock products. Local currencies, food, car and fuel co-ops, community supported agriculture all grow rapidly. Informal and household economies provide an increasing proportion of basic needs as corporate and government systems fail to deliver.

Around the larger cities especially in countries where social capital and community capacity is severely eroded, most of these new developments are in gated communities providing the basic needs and security of their residents with trade outside the community being more difficult or dangerous. Outside the gated communities salvage, fuel harvesting and animal husbandry are the main economic activities with trade controlled by gangs and local warlords.

While the impacts on people and local environments of this scenario are severe there is also a cultural and spiritual revolution as people are released from the rat race of addictive behaviours. While the impacts on people and local environments of this scenario are severe, in previously affluent countries at least, there is also a cultural and spiritual revolution as people are released from the rat race of addictive behaviors and begin to experience the gift of resurgent community and the simple abundance of nature to provide for basic needs.

The biggest difference from the Green and Brown Tech scenarios is that the rebuilding and stabilization is no longer based on dreams of sustainability or restoring the old system. Instead people accept that each generation will have to face the challenges of further ongoing simplification and localization of society as the fossil resource base continues to decline. This simplification in the material domain is seen as the opportunity for growth in the spiritual domain. There is a resurgence in leadership by women and a celebration of the feminine in nature and people. “Bottom Up Rebuild” summarises this scenario by emphasizing the new growth from biological and community foundations. In some ways this scenario might be considered as the archetypal one of the Energy Descent future and the one in which permaculture principles and strategies are most powerfully applied.

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4.  Lifeboats: Civilization Triage
Rapid energy decline rates, severe climate change symptoms.
Pasted from <http://www.futurescenarios.org/content/view/31/51/>
In this scenario, supplies of high quality fossil fuels decline rapidly, the economy fails and human contributions to global warming collapse, but lag effects and positive feedbacks in the climate system continue to drive an acceleration of global warming. As of 2007, an increasing number of scientists believe it may already be too late to avoid catastrophic climate change. In the Lifeboat scenario the adverse symptoms of the Brown Tech and Earth Steward scenarios combine to force a progressive collapse in most forms of economy and social organization. Local wars, including use of nuclear weapons accelerate collapse in some areas but the failure of national systems of power prevent global warfare. Successive waves of famine and disease breakdown social and economic capacity on a larger scale than the Black Death in medieval Europe leading to a halving of global population in a few decades.

New forms of oasis agriculture that are low input versions of the Brown Tech intensive systems evolve that stabilize food production as chaotic seasons make traditional field agriculture and horticulture almost impossible. Forest and rangeland hunting and harvesting become the predominant use of resources over large regions supporting nomadic bands. Warrior and gang cults provides meaning in a world of grief and violence, leading to the development of new religions and even languages that attempt to make sense of people’s lives.

Urban areas are largely abandoned and dangerous but remain valuable as quarries for salvaging materials especially metals. Suburban landscapes become ruralized into defensive hamlets making use of salvaged materials, urban storm water and surplus building space for mixed household economies.

The impacts are very patchy with worse effects in high density previously affluent and urbanized countries. In the most remote regions remnants of hunter-gatherer and pioneer farmer cultures are better able to weather the changes. The relative abundance and ongoing availability of high quality metals and other materials make a critical technological distinction from that of ancient traditional hunter gatherer cultures.

Mountain regions, especially with surviving glacier fed rivers allow hydroelectric systems to be maintained and rebuilt on a smaller scale. Nutrient rich glacier fed rivers also sustain intensive irrigated agriculture. In some localities, especially in favorable regions with accessible energy and agricultural resources, communities analogous to the monasteries of the early medieval period provide basic knowledge and skills to their surrounding communities and are thus protected by the locals from the ravages of local warlords and pirates. These communities, mostly in rural and suburban areas, and based on pre-collapse efforts of intentional communities or rich benefactors, pursue the task of saving and condensing knowledge and cultural values for the long dark ages ahead.

“Civilization triage” refers to the processes by which remaining social capacity (beyond meeting immediate basic needs) are focused on conserving technology and culture that could be useful to a future society, once energy descent is stabilized after a precipitous but limited collapse process. This is not the dominant process of the scenario but the most significant in terms of future cultural capacity. The Christian monasteries that saved many of the elements of Greco-Roman culture and later provided the foundations for the Renaissance of Western civilization is one historical example that could serve as a model for understanding how this process might work.

At its extreme, this scenario describes many of the elements of the Collapse Long Term future in which there is a complete breakdown in the lineage of industrial civilization such that future simple societies retain nothing from what we created through industrial civilization. Drawing a distinction between this scenario and total collapse may seem pedantic but the reasons are important. In the Collapse Long Term scenario, any future civilization that could emerge only learns from the lessons of ours via archeology and perhaps long attenuated mythic stories. In the Lifeboat scenario the retention of cultural knowledge of the past combined with a moderately habitable environment allow new civilizations to emerge that build on at least some of the knowledge and lessons from ours.

Three factors may prevent the continuous free fall to a very low global population of hunter gatherers surviving on the fringes of the Arctic of a hotter planet.
_1)  The first is the wild card created by the mixing of the world’s biota, most notable the large numbers of tree and other species that exhibit what foresters call “exotic vigour”. This allows new recombinant ecosystems to stabilize many environments that climate scientists are now saying will become uninhabitable in extreme climate change. The release of critical minerals, most notably phosphorus over the last 200 years into the biosphere may allow these new ecosystems to ultimately achieve biological productivity exceeding that possible from pre-existing systems.
_2)  Secondly the flooding of large areas of coastal lowlands complete with complex reef structures from flooded cities and infrastructure may also create the conditions for highly productive shallow waters and estuaries. These types of ecosystem are some of the most biologically productive ecosystems on the planet.
_3)  Thirdly, the precipitous drop in human numbers and their initial tendency to remain relatively aggregated to make use of the huge resources from industrial salvage materials (and for security) should see very large regions able to recover without harvesting and other impacts from people.

If the knowledge of ecological processes and their creative manipulation using minimal resources are retained and developed in the Lifeboat communities, then survival and resurgence of a more than minimalist culture may allow global human population to be sustained at perhaps half, rather than one tenth, of current levels. More importantly it may be possible to embed the wisdom of the lessons learnt so that unconstrained human growth does not repeat such an intense cycle. Clearly these last thoughts are highly speculative but build from the same linage of permaculture thinking developed over the last thirty years that informs the rest of the scenarios.

Summary of the Four Climate/Energy Descent Scenarios
The following table summarizes the main elements and characteristics of the four scenarios.

Continued in (Survival Manual/2. Social Issues/Our Future, Part 4 of 4)

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