I've added two new sites to The Ever-Evolving list of Links. Under the Fiction and Literature heading, Three Percent and under Culture, General, PopMatters.com. I first found out today about Three Percent from this video interview of Chad Post, director of Open Letter Press, devoted to publishing literature in translation. For some reason, I thought I already had included PopMatters, a natural for the General Culture Category. A quick check revealed otherwise, so I promptly added PM.
Click on All Links in the sidebar to see the latest changes.
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1 February 2009 update: I've added Get Kempt to the Fashion and Appearance section, and added a Peak Oil section.
Wednesday, January 28, 2009
Tuesday, January 27, 2009
Monday, January 19, 2009
Poverty Statistics
Anup Shah, Poverty Facts and Stats, GlobalIssues.org, Last updated: Wednesday, September 03, 2008
Cf. Global Rich List
Thursday, January 08, 2009
Happy Birthday to Me
I thought I'd share this poem by Kingsley Amis, which John Derbyshire posted a couple years back. Although the poem addresses newly-minted quinquagenarians--today I turn thirty-three, not fifty--"Ode to Me" speaks to anyone older than thirty.
Ode to Me
by Kingsley Amis
Fifty today, old lad?
Well, that's not doing so bad:
All those years without
Being really buggered about.
The next fifty won't be so good,
True, but for now—touch wood—
You can eat and booze and the rest of it,
Still get a lot of the best of it,
While the shags with fifty or so
Actual years to go
Will find most of them tougher,
The going a good bit rougher
Within the Soviet sphere—
Which means when the bastards are here,
Making it perfectly clear
That all that double-think
(Both systems on the blink,
East and West the same,
And war just the name of a game)
Is the ballocks it always was.
But will it be clear? Because
After a whole generation
Of phasing out education,
Throwing the past away,
Letting the language decay,
And expanding the general mind
Till it bursts, we might well find
That it wouldn't make much odds
To the poor semi-sentient sods
Shuffling round England then
That they've lost what made them men.
So bloody good luck to you, mate,
That you weren't born too late
For at least a chance of happiness,
Before unchangeable crappiness
Spreads over all the land.
Be glad you're fifty—and
That you got there while things were nice,
In a world worth looking at twice.
So here's wishing you many more years,
But not all that many. Cheers!
Ode to Me
by Kingsley Amis
Fifty today, old lad?
Well, that's not doing so bad:
All those years without
Being really buggered about.
The next fifty won't be so good,
True, but for now—touch wood—
You can eat and booze and the rest of it,
Still get a lot of the best of it,
While the shags with fifty or so
Actual years to go
Will find most of them tougher,
The going a good bit rougher
Within the Soviet sphere—
Which means when the bastards are here,
Making it perfectly clear
That all that double-think
(Both systems on the blink,
East and West the same,
And war just the name of a game)
Is the ballocks it always was.
But will it be clear? Because
After a whole generation
Of phasing out education,
Throwing the past away,
Letting the language decay,
And expanding the general mind
Till it bursts, we might well find
That it wouldn't make much odds
To the poor semi-sentient sods
Shuffling round England then
That they've lost what made them men.
So bloody good luck to you, mate,
That you weren't born too late
For at least a chance of happiness,
Before unchangeable crappiness
Spreads over all the land.
Be glad you're fifty—and
That you got there while things were nice,
In a world worth looking at twice.
So here's wishing you many more years,
But not all that many. Cheers!
Monday, January 05, 2009
But I Do!
"Why You Should Know Who Michael Shannon Is"--New York
22 January update: Michael Shannon is a Best Supporting Actor nominee. To explain this post's title, I knew of him from his roles in 8 Mile, Kangaroo Jack, and Bad Boys II. In these movies his characters were all louts but each was distinct: Greg Buehl was the boyfriend of B-Rabbit's mother, Frankie "The Vermin" Lombardo, a mob henchman, and Floyd Poteet, a scuzzy Klansman. Until now, these were his most famous characters.
22 January update: Michael Shannon is a Best Supporting Actor nominee. To explain this post's title, I knew of him from his roles in 8 Mile, Kangaroo Jack, and Bad Boys II. In these movies his characters were all louts but each was distinct: Greg Buehl was the boyfriend of B-Rabbit's mother, Frankie "The Vermin" Lombardo, a mob henchman, and Floyd Poteet, a scuzzy Klansman. Until now, these were his most famous characters.
Kunstler on the Bush Years
Kunstler doesn't hold back.
January 5, 2009
Farewell GWB
...
I never believed that GWB actually tricked the nation on the "weapons of mass destruction" rationale for invading Iraq. Rather, the nation fooled itself into thinking that the war, in the first place, was anything but an act of vengeance for the gross injury of 9/11. After a couple of years, the public adopted the stupid narrative that they were "lied to," rather than recognizing the difficult truth that 9/11 had to be answered with lethal force, that international hostilities are far from wholly rational, and that Saddam Hussein got whacked because he was the Arab head-of-state who was the best candidate for getting whacked. A nation in thrall to psychotherapy, and self-esteem building programs, and the "win-win" bullshit of business Babbitry, couldn't imagine a tragic dilemma when one was staring them in the face.
GWB won reelection in 2004 -- running against the weak John Kerry, "a haircut in search of a brain," as Kevin Phillips put it so memorably, who was not smart enough to pander successfully (though he tried) to the dominant, Jesus-soaked Nascar fans who inhabit the Moron Crescent that runs from West Virginia south through Dixie and then west into Idaho. GWB was still riding pretty high when Hurricane Katrina slammed into the swamps and beaches east of Lake Ponchartrain, and the president failed to direct anybody to so much as air-drop bottled drinking water for survivors dying on rooftops and highway overpasses in New Orleans. The Left, once again, adopted an idiotic narrative to explain the event -- that Bush acted to punish African-Americans -- when plain incompetence combined with grandiose expectations for a televised happy ending to instead produce tragedy.
The fiasco in New Orleans was matched by the apparent failure to police Iraq back to stability, making the whole project appear feckless and futile, and GWB began his long swoon into discredit. But two other conditions were intensifying in the background, one the consequence of the other: peak oil and peak credit. As the primary resource of industrial capitalism reached its all-time production peak in 2005, the managers of the US economy allowed borrowing-from-the-future to replace productive activity as the basis for everyday life.
GWB barely acknowledged this compound problem. He asserted that America was addicted to oil, but he failed to take the idea a step further and say that our vaunted "way-of-life" could no longer be taken for granted. If anything, he endorsed the popular idea that a suburban lifestyle and WalMart consumerism was a Jesus-driven entitlement, and his circle in governance did everything possible to replace the industrial economy with an economy based on suburban land development and credit card spending -- which was enabled by fantastic experiments in finance that proved to be nothing more than an impenetrable web of swindles.
Those swindles began to unwind in 2007 and they now threaten to sink the USA as a viable enterprise. Their exact extent and nature still remain obscure, like the algorithms used to engineer the "alphabet soup" of fraudulent securities and recondite derivatives. In this stupendous failure, GWB is joined by his cohorts and minions in Republican polity, whose flamboyant misfeasance continues to make the credit blow-up worse by the minute. He leaves his successor, Mr. Obama, a predicament so dismal that the secession crisis of 1860 begins to look like a mere procedural quarrel in comparison. And despite the temporary crash of oil prices, the peak oil problem still looms very large in the background and has barely begun to work its hoodoo on what's left of the US economy.
...
To me, GWB will remain the perfect representative of his time, place, and culture. During his years in Washington, America became a nation of clowns posturing in cowboy hats, bethinking ourselves righteous agents of Jesus in a Las Vegas of the spirit, where wishing was enough to get something for nothing, where "mistakes were made," but everybody was excused from the consequences of bad choices. The break from that mentality will be very severe, and we may look back in twelve months and wonder how we ever fell for the whole package. The answering of that question will occupy historians for ages to come.
January 5, 2009
Farewell GWB
...
I never believed that GWB actually tricked the nation on the "weapons of mass destruction" rationale for invading Iraq. Rather, the nation fooled itself into thinking that the war, in the first place, was anything but an act of vengeance for the gross injury of 9/11. After a couple of years, the public adopted the stupid narrative that they were "lied to," rather than recognizing the difficult truth that 9/11 had to be answered with lethal force, that international hostilities are far from wholly rational, and that Saddam Hussein got whacked because he was the Arab head-of-state who was the best candidate for getting whacked. A nation in thrall to psychotherapy, and self-esteem building programs, and the "win-win" bullshit of business Babbitry, couldn't imagine a tragic dilemma when one was staring them in the face.
GWB won reelection in 2004 -- running against the weak John Kerry, "a haircut in search of a brain," as Kevin Phillips put it so memorably, who was not smart enough to pander successfully (though he tried) to the dominant, Jesus-soaked Nascar fans who inhabit the Moron Crescent that runs from West Virginia south through Dixie and then west into Idaho. GWB was still riding pretty high when Hurricane Katrina slammed into the swamps and beaches east of Lake Ponchartrain, and the president failed to direct anybody to so much as air-drop bottled drinking water for survivors dying on rooftops and highway overpasses in New Orleans. The Left, once again, adopted an idiotic narrative to explain the event -- that Bush acted to punish African-Americans -- when plain incompetence combined with grandiose expectations for a televised happy ending to instead produce tragedy.
The fiasco in New Orleans was matched by the apparent failure to police Iraq back to stability, making the whole project appear feckless and futile, and GWB began his long swoon into discredit. But two other conditions were intensifying in the background, one the consequence of the other: peak oil and peak credit. As the primary resource of industrial capitalism reached its all-time production peak in 2005, the managers of the US economy allowed borrowing-from-the-future to replace productive activity as the basis for everyday life.
GWB barely acknowledged this compound problem. He asserted that America was addicted to oil, but he failed to take the idea a step further and say that our vaunted "way-of-life" could no longer be taken for granted. If anything, he endorsed the popular idea that a suburban lifestyle and WalMart consumerism was a Jesus-driven entitlement, and his circle in governance did everything possible to replace the industrial economy with an economy based on suburban land development and credit card spending -- which was enabled by fantastic experiments in finance that proved to be nothing more than an impenetrable web of swindles.
Those swindles began to unwind in 2007 and they now threaten to sink the USA as a viable enterprise. Their exact extent and nature still remain obscure, like the algorithms used to engineer the "alphabet soup" of fraudulent securities and recondite derivatives. In this stupendous failure, GWB is joined by his cohorts and minions in Republican polity, whose flamboyant misfeasance continues to make the credit blow-up worse by the minute. He leaves his successor, Mr. Obama, a predicament so dismal that the secession crisis of 1860 begins to look like a mere procedural quarrel in comparison. And despite the temporary crash of oil prices, the peak oil problem still looms very large in the background and has barely begun to work its hoodoo on what's left of the US economy.
...
To me, GWB will remain the perfect representative of his time, place, and culture. During his years in Washington, America became a nation of clowns posturing in cowboy hats, bethinking ourselves righteous agents of Jesus in a Las Vegas of the spirit, where wishing was enough to get something for nothing, where "mistakes were made," but everybody was excused from the consequences of bad choices. The break from that mentality will be very severe, and we may look back in twelve months and wonder how we ever fell for the whole package. The answering of that question will occupy historians for ages to come.
Wednesday, December 31, 2008
One Word
In a few weeks a much-discussed biographical movie should be coming to Hilo. Its subject is a man, who in his brief time upon the national stage, had everyone talking. Just as he was about to reach new heights of achievement, he was brutally gunned down. The title of this movie is only one word. But one word can say it all.
Monday, December 29, 2008
Kunstler's Forecast for 2009
Reprinted in full. Curiously, there's no mention of Dubai, so extravagant it makes Las Vegas look like an Amish village.
December 29, 2008
Forecast for 2009
There are two realities "out there" now competing for verification among those who think about national affairs and make things happen. The dominant one (let's call it the Status Quo) is that our problems of finance and economy will self-correct and allow the project of a "consumer" economy to resume in "growth" mode. This view includes the idea that technology will rescue us from our fossil fuel predicament -- through "innovation," through the discovery of new techno rescue remedy fuels, and via "drill, baby, drill" policy. This view assumes an orderly transition through the current "rough patch" into a vibrant re-energized era of "green" Happy Motoring and resumed Blue Light Special shopping.
The minority reality (let's call it The Long Emergency) says that it is necessary to make radically new arrangements for daily life and rather soon. It says that a campaign to sustain the unsustainable will amount to a tragic squandering of our dwindling resources. It says that the "consumer" era of economics is over, that suburbia will lose its value, that the automobile will be a diminishing presence in daily life, that the major systems we've come to rely on will founder, and that the transition between where we are now and where we are going is apt to be tumultuous.
My own view is obviously the one called The Long Emergency.
Since the change it proposes is so severe, it naturally generates exactly the kind of cognitive dissonance that paradoxically reinforces the Status Quo view, especially the deep wishes associated with saving all the familiar, comfortable trappings of life as we have known it. The dialectic between the two realities can't be sorted out between the stupid and the bright, or even the altruistic and the selfish. The various tech industries are full of MIT-certified, high-achiever Status Quo techno-triumphalists who are convinced that electric cars or diesel-flavored algae excreta will save suburbia, the three thousand mile Caesar salad, and the theme park vacation. The environmental movement, especially at the elite levels found in places like Aspen, is full of Harvard graduates who believe that all the drive-in espresso stations in America can be run on a combination of solar and wind power. I quarrel with these people incessantly. It seems especially tragic to me that some of the brightest people I meet are bent on mounting the tragic campaign to sustain the unsustainable in one way or another. But I have long maintained that life is essentially tragic in the sense that history won't care if we succeed or fail at carrying on the project of civilization.
While the public supposedly voted for "change" this fall, I maintain that they underestimate the changes really at hand. I voted for "change" myself in pulling the lever for Barack Obama. I regard him as a figure of intelligence and sensibility, but I'm far from convinced that he really sees the kind of change we are in for, and I fret about the measures he'll promote to rescue the Status Quo when he moves into the White House a few weeks from now.
Where We Are Now
Without reviewing all the vertiginous particulars of the year now ending, suffice it to say that the US economy fell on its ass and that the "global economy" did a face-plant as well. The American banking sector imploded spectacularly to the degree that investment banking actually went extinct -- as if a meteor landed on the corner of Madison Avenue and 51st Street. The response by our government was to shovel "loans" onto the loading dock of every organization that pretended to be something like a bank, while "bailing out" an ever-longer line of corporate claimants with a pitiable song-and-dance. The oil markets went on a roller coaster ride. The housing bubble collapse grew to avalanche velocity (taking out whole colonies of realtors, mortgage brokers, and construction contractors in its path), the commercial real estate sector developed hemorrhagic fever, retail drove off a cliff on Christmas Eve, the stock market fell in the toilet, jobs and incomes went up in a vapor, and tens of millions of ordinary citizens addicted to revolving credit found themselves in a life-and-death struggle for the means of existence. None of this is over yet.
The Year Ahead
Much of what has been lost in 2008 will not be recovered: enterprises, personal fortunes, chattels, reputations.
I expect a period of euphoria to mark the early weeks, perhaps months, of the Obama team. It will be a relief to have a president who speaks English correctly and has experienced something like real life prior to politics. Restoring credibility and legitimacy in leadership will be a big deal. If nothing else, we may recover a collective sense of consequence from a president who tells the truth, even the harsh truth. The age when it was enough to claim that "mistakes were made" might be over. A sign of this sort of change may be the commencement of prosecutions for misdeeds in banking and securities that are now destroying the entire system of deployable capital. A good place to start will be an investigation of Henry Paulson for insider trading stemming from Goldman Sachs's shorting of its own issued mortgage-backed securities when Mr. Paulson was the company's CEO. Beyond his case, there should be enough work at Attorney General Eric Holder's office to employ a line of law school graduates stretching from Brattle Street to the planet Mars. It will be salutary for the nation to see those who engineered the banking collapse come to greater grief than the mere surrender of their Gulfstream jets and Hamptons villas. By the way, being allergic to conspiracy theories, I don't believe for a minute that there is some kind of shadow elite of "Bilderburgers" standing in the background to protect these grifters -- and I also believe the reason these paranoid notions persist is because it is otherwise hard to account for the extravagant irresponsibility of the Bush circle and its servelings.
Apart from "cleaning up Dodge," so to speak, and from issues of collective character-and conscience-in-office, I worry that the avalanche of troubles already ongoing will overwhelm Mr. Obama and his people. It's also well worth worrying whether they will pursue policies similar in kind to the ones pursued by Bush, namely throwing money at everything and anything, and it sure looks like they are planning to do just that. I am especially concerned about an "infrastructure stimulus" project aimed at highway improvement at the expense of public transit. This would be the epitome of a campaign to sustain the unsustainable. We need to begin planning right away for a transition away from automobiles, not in order to be good socialists but because Happy Motoring is at the core of our unsustainability trap. The car system is going to fail in manifold ways whether we like it or not, and it will fail due to circumstances already underway. For one thing, it will cease to be democratic as the remnants of the middle class find it impossible to get car loans, or pay for fuel, or insurance, and that will set in motion a very impressive politics-of-grievance setting apart those who are still able to enjoy motoring and those who have been foreclosed from it. Contrary to what you might make of the the current situation in the oil markets, we are in for a heap of trouble with both the price and supply of petroleum (more on this below). And there is no chance in hell that any techno rescue remedy to keep all the cars running by other means will materialize.
A consensus in the blogoshpere says that the stock markets will rebound strongly during the first Obama months. This is possible just on the basis of pure "animal spirits," but the Obama Bounce will occur against a background of continued dismal business and financial news. It will appear to defy that news. By May of 2009, the stock markets will resume crashing with the ultimate destination of a Dow 4000 before the end of the year. Meanwhile, jobs will vanish by the millions and companies will go bankrupt by the thousands, especially in the so-called service sector, and in all the suppliers of such, along with the landlords in all the malls and strip malls. The desolation will mount quickly and will be obvious in the empty storefronts and trash-filled parking lagoons. In the event, two things will become increasingly clear to the nation: that the consumer economy is dead, and that there is no more available credit of the kind that Americans are in the habit of enjoying.
We'll turn around early in 2009 and discover that we are a much poorer nation than we thought because from now on credit will be extremely hard to get for anyone for anything. The businesses that survive will have to keep going on the basis of accounts receivable. This is the area where the crash of giants will be heard. I've been saying since publication of The long Emergency that comprehensive downscaling in all our activities, from farming to business to schooling to governance, will be the categorical imperative of the years ahead. Giant enterprises requiring giant loans to get from quarter to quarter will tend to not make it. Borrowing from the future will become a practical impossibility as past bad debts from previous borrowings continue to unwind, cease performing, and get written off. This argument implies that the federal government will tend to flounder just as General Motors, Citicorp, Target Stores and other gigantic enterprises will tend to flounder. It would be sad to see a President Obama so hamstrung and helpless, and it is largely why I see his role as largely symbolic -- as a reassuring presence encouraging the distressed public to bravely bear their hardships, and to be kind and helpful among their neighbors.
Households, like businesses, will have to pay as they go from earned income. The house as ATM is over. Credit cards are maxed out and credit ceilings are lowering like the ceiling in "The Pit and the Pendulum," preparing to slice-and-dice the old "normal" of family life in America. Bankruptcy will be the new Nascar. A lot of families will lose everything. They will sift and disperse into the housing owned by other family members -- parents, siblings -- and a strange new not-altogether comfortable kind of togetherness will become common. Over time, a lot of people will go looking for casual work "under-the-table"( and probably low-paying). To some degree, these workers will begin to look and act like a new servant class, and before too long they may be absorbed into the households of people who employ them. There will be plenty of room for them there.
Counties, municipalities, and states will join in the bankruptcy fiesta. It would be reasonable to expect collapsing services as a result. This would be a situation fraught with danger -- of rising crime, of public health emergencies as water systems are not kept up and sewage treatment becomes unaffordable. I don't imagine the federal government stepping into every Podunk or Metropolis from sea to shining sea and propping up these services. People will have to cope with danger and deprivation.
2009 may be the point where we begin to understand what kinds of places will be more hospitable to human society further ahead. I maintain that our giant urban metroplexes have way overshot their sustainable scale and will contract severely. With all the economic hardship, we ought to expect a lot of demographic churning, people leaving hopeless places and moving on to something more promising. I believe we will see them move to smaller towns and smaller cities. The reorganization of the rural landscape into smaller-scaled farms has not begun to occur -- though 2009 might be very hard on agribusiness, given the shortage of capital and if oil begins to march up in price by late winter. Eventually, the rural landscape will require the labor of many more people than is currently the case. Whatever else happens, 2009 will surely see a massive return to home gardening as budgets become strained to the extreme. As the New Urbanist Andres Duany said recently, "Gardening is the new Golf!"
The oil scene
Many were stunned this year to witness the parabolic rise and fall of oil prices up to nearly $150 and then back around $36 by Christmas time. Quite a ride. I said in The Long Emergency that volatility would be the hallmark of post peak oil because it was obvious that advanced economies could not absorb super high prices and would crash in response; that at some point after crashing, these economies would respond to the new lower oil price, resume their cheap oil habits, and build to another price rise. . . and crash again. . . in a declension of ever-lower industrial activity.
What I probably didn't realize at the time was how destructive this cycling between low-high-and-low oil prices would actually be in the first instance of it, and what a toll it would take right off the bat. We can see now that our first journey through the cycle took out the most fragile of the complex systems we depend on: capital finance. As a result, a huge amount of capital (say $14 trillion) has evaporated out of the system, never to be seen again (and never to be deployed for productive purposes). It will be harder for the USA to rebound from the grievous injury to this crucial part of the overall system, and Europe has foundered similarly -- though the European nations are not burdened to the same degree by the awful liabilities of suburbia.
Even if these advanced economies -- throw in Japan too -- remain moribund, the price and supply prospects for oil look ominous. My own guess is that the price of oil has overshot on the low end just as it overshot on the high end, and that, when all is said and done, we'll still see an upwardly trending price line over the long haul. The plunge, which began right after the $147 peak in July 2008, was as much the result of banks, hedge funds, and individuals dumping oil investments and positions to raise cash as it was a matter of the markets predicting a sharp fall-off in economic activity (and supposedly oil consumption). The truth is that demand destruction for oil in the USA has been surprising mild compared to the drop in price. Jim Hansen's Master Resource Report says that gasoline consumption dropped from 9.29 million barrels a day in 2007 to 8.99 million barrels a day for 2008. That's not much of a fall-off, especially compared to the price drop.
As Julian Darley of the Post Carbon Institute put it recently: "There won't be any energy bail-out." And, as many other people have noted, the recent plunge in oil prices strongly implies future supply destruction, since so many planned oil projects have been suspended or cancelled because they are economic losers at $40-a-barrel (or even $70). Even projects well underway, such as Canadian tar sand production, have been scaled back or shut down because they don't make sense at current prices. Some of these other newer projects will now never get underway -- they have missed their window of opportunity with so much capital leaving the system -- and so the hope of offsetting very-near-future depletions in old giant oil fields looks dimmer and dimmer.
Those depletions are very serious. For instance, Mexico's super-giant Cantarell oil field, the second-largest ever discovered after Saudi Arabia's Ghawar field, has shown a 30 percent depletion rate in the past year alone. (Pemex had forecast a 15 percent rate entering the year.) Cantarell provides over 60 percent of Mexico's total production, and Mexico is America's third largest source of imports -- just after Saudi Arabia (#2) and Canada (#1). Obviously, Mexico soon will lose its ability to export oil, and as that occurs, America is going to feel more than pinch -- more like a two-by-four upside the head. In short, remorseless depletion is underway and we are less likely now than even a year ago, to make up for it.
At some point, then, demand, even if slightly lower, will catch up with declining supply. My prediction for 2009 is that we will see two things occur, possibly at the same time: a resumption of rising prices, and spot shortages. I say this because the global economic fiasco is sure to produce geopolitical friction, and inasmuch as America has to import almost three-quarters of the oil we use, the prospect for trouble is great.
The tragic part of all this, of course, is that the temporary plunge in oil prices has prompted an incurious American public to assume, once again, that the global oil predicament is some kind of a fraud. Given the flood tide of fraud they have been subject to in banking and investment matters, I suppose you can't blame them from thinking that everything is some kind of a scam. Given feeble car sales this season, there are reports that an increasing percentage of those sold now are are trucks and SUVs.
Though I give Boone Pickens high marks for stepping up to the leadership plate, I'm not altogether on board with his energy proposal for swapping natural gas for gasoline in motor fuels while we swap out wind power for natural gas in electric power generation. I don't believe that the ballyhooed shale-gas-plays of the last few years will prove-out long-term, as some huckster's claim. They are expensive to drill and run, and they all tend to deplete very quickly -- around one year. I'm not convinced we have the capital or the resources even to come up with the steel necessary to drill for it. Anyway, the last thing we need is a way to prolong our car-dependency.
In the meantime, there are still those who hope (as described above) that various alt.energy systems will insure the continuation of Happy Motoring. This is an idle hope, and 2009 will be very sobering for those who imagine that hybrid cars, or electric cars, or "air" cars, or natural gas cars, or any other kind of car technology will save the day. Even if President Obama mounts an "infrastructure stimulus" program, it will not keep up with all the necessary routine road repair that our highway system requires. The extreme financial hardship faced by localities and states insures that they will have to postpone a lot of expensive highway maintenance -- even if the federal government fixes a big bunch of bridges and tunnels -- and so we face the interesting prospect that our roadway systems will enter their own deadly zone of systemic failure even before the whole car issue is settled.
I am waiting to see whether Mr. Obama will undertake a restoration of passenger railroad service. I've said enough about this in the past, but it's worth reiterating that a failure to get comprehensive passenger rail service going will be a sign of how fundamentally unserious we are as a nation.
The Specter of Inflation
This is the "other shoe" that a lot of people are waiting to drop. Right now we are caught up in a compressive debt deflation as mortgages stop "performing" and loans of all kinds are welshed on. Since money is loaned into existence, and a great many loans are not being repaid, then a lot of money is going out of existence. That's what I mean when I say that capital is leaving the system. At the same time, the Federal Reserve has made good on its promise to drop money from helicopters if necessary to prevent an implosion of the banking system (as all that older money goes out of existence), and so it's now a question as to when the amount of new money will exceed the disappeared old money. (Of course when I say money, I mean "money," because we are dealing here in a shadow realm of assumed value.) In any case, there is bound to be a lag period between the time that the Fed's money is dropped from the choppers and the time it actually filters through the banks and other recipients to the so-called "real economy" of people who buy and sell real things. The credible estimates I hear run between six and 18 months.
I'll only venture to guess that we could see the start of serious inflation sometime in 2009. To some extent, all currencies are now free-falling together, some at slightly faster rates than others, but the situation of the US dollar is so grotesquely dire, and our structural imbalances so monumental, that it is hard to imagine that our currency will not win the international race to the bottom. Gold resumed its movement upward against the dollar a week before Christmas, and that may be an early sign. The government -- and anyone badly in debt -- benefits much more from inflation than deflation, so every effort will be made to avert the latter. The trouble lies in the government's dumb incapacity to control dangerous things that it sets in motion, so that an inflationary campaign to avoid compressive deflation can so easily lead to a fiasco of super or hyper inflation -- the kind that kills governments and turns societies into murderous monsters. I'll forecast the that the US dollar is worth 40 percent of its current value by next Christmas.
Geopolitics
Well, now, who the hell knows what's in store. Aside from a few bombs here and there, and pirates skulking around the horn of Africa, the world scene was miraculously free of major incidents in 2008 -- perhaps the worst being a toss up between the September [November, actually--P.Z.] Mumbai bombings and the fiasco in Georgia, where the US prompted Georgia President Mikheil Saakashvili to send troops into the South Ossetia region and the move was answered by overwhelming force from neighboring Russia, leaving the US looking feckless and retarded for our troubles. But otherwise, there wasn't a whole lot of action out there.
Until the last few days of the year, that is. I'm sure the ever-growing cohort of American anti-semites who send me emails will be tickled when I assert that the Hamas rocket attacks against Israel of recent days guaranteed a sharp response from Israel -- and now, of course, Hamas is playing the crybaby card: "... what'd we do to deserve this...?" Well, you fucking fired a bunch rockets into Israel. Did you ever hear of cause-and-effect? This matter requires no further elucidation, except that it seems to suggest a ramping back up of hostilities. I wonder if it is the beginning of a new coordinated offensive by Islamic extremism aimed at taking advantage of the West's current economic plight (and the West's probable aversion to anything that will complicate its desired recovery). We'll know in a month or so, I think, since any coordinated campaign (if such a thing were possible) might well be aimed at confounding the new American president.
The other hot corner of the world right now is the India-Pakistan border where the 60-year-old rivalry, which has already produced three wars, looks to be gearing up for yet another round. I'm not the first one to say that Pakistan is an extremely dangerous regional player, being an economic basket case, possessing a score or so of nuclear bombs, harboring more Islamic fundamentalist maniacs than any other place in the world, and having a government held together with duct tape and twine. The caper in Mumbai last September could well have been construed as an act of war, but somehow India kept its head. Who knows where this is going. . . .
So far I have only described what is already obviously going on. Add to this the likelihood that Iran is closer to achieving membership in the atomic weapon club. They've been spinning their centrifuges all year and nobody has done anything about it. My guess is that neither the US nor Israel will attempt to take out their facilities in the year ahead. If Iran used a nuclear device against Israel, or anybody else, they would be asking to become, in turn, the world's largest ashtray. End of story. A different story, though, is how Iran might behave if and when the US Military presence in Iraq is reduced. I can imagine Iran doing anything possible surreptitiously to gain control over Iraq's southern oil regions around Basra, but even the Iraqi Shia don't like the Iranian Shia that much. Anyway, iran's economy has suffered hugely from the fall in oil prices. That nation may be in for more internal trouble than they have seen in thirty years since the Shah was tossed out by the minions of Ayatollah Khomeini.
There's been a lot of sentiment the past year that as the US and the Europe fall into economic disarray, China would emerge as the great new hegemonic superpower. While it's come a long way in a quarter-century, China's internal problems are still enormous and worsening. They're in trouble with water, food imports, mass unemployment, and energy. They have locked in some oil contracts around the world, but they are still susceptible to vagaries in the oil markets and Black Swan events. As the US consumer economy falls into a coma, and the shipping containers from China to WalMart get sparser, the Chinese government will face the wrath of millions of unemployed workers. I believe they will struggle through 2009, perhaps growing more surly as the US dollar inflates and their holdings of treasury bills begins to look more like a swindle.
Russia may be suffering economically for the moment due to the crash of oil prices, but they are energy resource-rich -- at least for the next couple of decades -- and if they don't like the current price, they can keep more of their oil in the ground until the price looks more attractive. I think Mr. Putin has the confidence of the Russian people and will survive the current malaise.
Japan remains a riddle wrapped in toasted nori. They're beggaring their own factory workers to stay solvent. Their banking sector has been zombified for a generation. They import 95 percent of the energy they use. Do they have a plan? One can imagine them sliding in resignation back to something like the sixteenth century, giving up the whole industrial circus as more trouble than it's worth, just as they once gave up on firearms.
The over-arching geopolitical theme of 2009 will be the end of robust globalism as we've known it for some time. Reduced trade, competition for energy resources, sore feelings over debts and currencies will drive the nations inward or, at least, direct their energies toward their own regions. Note to Tom Friedman: the world turned out to be round after all.
Conclusion
The big theme for 2009 economically will be contraction. The end of the cheap energy era will announce itself as the end of conventional "growth" and the shrinking back of activity, wealth, and populations. Contraction will come as a great shock to a world of conventionally programmed economists. They will toil and sweat to account for it, and they will probably be wrong. Unfortunately, this contraction will do its work in unpleasant ways, driving down standards of living, shearing away hopes and expectations for a particular life of comfort, and introducing disorder to so many of the systems we have depended on for so long. People will starve, lose their homes, lose incomes and status, and lose the security of living in peaceful societies. It will become clear that the Long Emergency is underway.
My hope for the year, at least for my own society, is that we will transition away from being a nation of complacent, distracted, over-fed clowns, to become a purposeful and responsible people willing to put their shoulders to the wheel to get some things done. My motto for the new year: "no more crybabies!"
===
December 29, 2008
Forecast for 2009
There are two realities "out there" now competing for verification among those who think about national affairs and make things happen. The dominant one (let's call it the Status Quo) is that our problems of finance and economy will self-correct and allow the project of a "consumer" economy to resume in "growth" mode. This view includes the idea that technology will rescue us from our fossil fuel predicament -- through "innovation," through the discovery of new techno rescue remedy fuels, and via "drill, baby, drill" policy. This view assumes an orderly transition through the current "rough patch" into a vibrant re-energized era of "green" Happy Motoring and resumed Blue Light Special shopping.
The minority reality (let's call it The Long Emergency) says that it is necessary to make radically new arrangements for daily life and rather soon. It says that a campaign to sustain the unsustainable will amount to a tragic squandering of our dwindling resources. It says that the "consumer" era of economics is over, that suburbia will lose its value, that the automobile will be a diminishing presence in daily life, that the major systems we've come to rely on will founder, and that the transition between where we are now and where we are going is apt to be tumultuous.
My own view is obviously the one called The Long Emergency.
Since the change it proposes is so severe, it naturally generates exactly the kind of cognitive dissonance that paradoxically reinforces the Status Quo view, especially the deep wishes associated with saving all the familiar, comfortable trappings of life as we have known it. The dialectic between the two realities can't be sorted out between the stupid and the bright, or even the altruistic and the selfish. The various tech industries are full of MIT-certified, high-achiever Status Quo techno-triumphalists who are convinced that electric cars or diesel-flavored algae excreta will save suburbia, the three thousand mile Caesar salad, and the theme park vacation. The environmental movement, especially at the elite levels found in places like Aspen, is full of Harvard graduates who believe that all the drive-in espresso stations in America can be run on a combination of solar and wind power. I quarrel with these people incessantly. It seems especially tragic to me that some of the brightest people I meet are bent on mounting the tragic campaign to sustain the unsustainable in one way or another. But I have long maintained that life is essentially tragic in the sense that history won't care if we succeed or fail at carrying on the project of civilization.
While the public supposedly voted for "change" this fall, I maintain that they underestimate the changes really at hand. I voted for "change" myself in pulling the lever for Barack Obama. I regard him as a figure of intelligence and sensibility, but I'm far from convinced that he really sees the kind of change we are in for, and I fret about the measures he'll promote to rescue the Status Quo when he moves into the White House a few weeks from now.
Where We Are Now
Without reviewing all the vertiginous particulars of the year now ending, suffice it to say that the US economy fell on its ass and that the "global economy" did a face-plant as well. The American banking sector imploded spectacularly to the degree that investment banking actually went extinct -- as if a meteor landed on the corner of Madison Avenue and 51st Street. The response by our government was to shovel "loans" onto the loading dock of every organization that pretended to be something like a bank, while "bailing out" an ever-longer line of corporate claimants with a pitiable song-and-dance. The oil markets went on a roller coaster ride. The housing bubble collapse grew to avalanche velocity (taking out whole colonies of realtors, mortgage brokers, and construction contractors in its path), the commercial real estate sector developed hemorrhagic fever, retail drove off a cliff on Christmas Eve, the stock market fell in the toilet, jobs and incomes went up in a vapor, and tens of millions of ordinary citizens addicted to revolving credit found themselves in a life-and-death struggle for the means of existence. None of this is over yet.
The Year Ahead
Much of what has been lost in 2008 will not be recovered: enterprises, personal fortunes, chattels, reputations.
I expect a period of euphoria to mark the early weeks, perhaps months, of the Obama team. It will be a relief to have a president who speaks English correctly and has experienced something like real life prior to politics. Restoring credibility and legitimacy in leadership will be a big deal. If nothing else, we may recover a collective sense of consequence from a president who tells the truth, even the harsh truth. The age when it was enough to claim that "mistakes were made" might be over. A sign of this sort of change may be the commencement of prosecutions for misdeeds in banking and securities that are now destroying the entire system of deployable capital. A good place to start will be an investigation of Henry Paulson for insider trading stemming from Goldman Sachs's shorting of its own issued mortgage-backed securities when Mr. Paulson was the company's CEO. Beyond his case, there should be enough work at Attorney General Eric Holder's office to employ a line of law school graduates stretching from Brattle Street to the planet Mars. It will be salutary for the nation to see those who engineered the banking collapse come to greater grief than the mere surrender of their Gulfstream jets and Hamptons villas. By the way, being allergic to conspiracy theories, I don't believe for a minute that there is some kind of shadow elite of "Bilderburgers" standing in the background to protect these grifters -- and I also believe the reason these paranoid notions persist is because it is otherwise hard to account for the extravagant irresponsibility of the Bush circle and its servelings.
Apart from "cleaning up Dodge," so to speak, and from issues of collective character-and conscience-in-office, I worry that the avalanche of troubles already ongoing will overwhelm Mr. Obama and his people. It's also well worth worrying whether they will pursue policies similar in kind to the ones pursued by Bush, namely throwing money at everything and anything, and it sure looks like they are planning to do just that. I am especially concerned about an "infrastructure stimulus" project aimed at highway improvement at the expense of public transit. This would be the epitome of a campaign to sustain the unsustainable. We need to begin planning right away for a transition away from automobiles, not in order to be good socialists but because Happy Motoring is at the core of our unsustainability trap. The car system is going to fail in manifold ways whether we like it or not, and it will fail due to circumstances already underway. For one thing, it will cease to be democratic as the remnants of the middle class find it impossible to get car loans, or pay for fuel, or insurance, and that will set in motion a very impressive politics-of-grievance setting apart those who are still able to enjoy motoring and those who have been foreclosed from it. Contrary to what you might make of the the current situation in the oil markets, we are in for a heap of trouble with both the price and supply of petroleum (more on this below). And there is no chance in hell that any techno rescue remedy to keep all the cars running by other means will materialize.
A consensus in the blogoshpere says that the stock markets will rebound strongly during the first Obama months. This is possible just on the basis of pure "animal spirits," but the Obama Bounce will occur against a background of continued dismal business and financial news. It will appear to defy that news. By May of 2009, the stock markets will resume crashing with the ultimate destination of a Dow 4000 before the end of the year. Meanwhile, jobs will vanish by the millions and companies will go bankrupt by the thousands, especially in the so-called service sector, and in all the suppliers of such, along with the landlords in all the malls and strip malls. The desolation will mount quickly and will be obvious in the empty storefronts and trash-filled parking lagoons. In the event, two things will become increasingly clear to the nation: that the consumer economy is dead, and that there is no more available credit of the kind that Americans are in the habit of enjoying.
We'll turn around early in 2009 and discover that we are a much poorer nation than we thought because from now on credit will be extremely hard to get for anyone for anything. The businesses that survive will have to keep going on the basis of accounts receivable. This is the area where the crash of giants will be heard. I've been saying since publication of The long Emergency that comprehensive downscaling in all our activities, from farming to business to schooling to governance, will be the categorical imperative of the years ahead. Giant enterprises requiring giant loans to get from quarter to quarter will tend to not make it. Borrowing from the future will become a practical impossibility as past bad debts from previous borrowings continue to unwind, cease performing, and get written off. This argument implies that the federal government will tend to flounder just as General Motors, Citicorp, Target Stores and other gigantic enterprises will tend to flounder. It would be sad to see a President Obama so hamstrung and helpless, and it is largely why I see his role as largely symbolic -- as a reassuring presence encouraging the distressed public to bravely bear their hardships, and to be kind and helpful among their neighbors.
Households, like businesses, will have to pay as they go from earned income. The house as ATM is over. Credit cards are maxed out and credit ceilings are lowering like the ceiling in "The Pit and the Pendulum," preparing to slice-and-dice the old "normal" of family life in America. Bankruptcy will be the new Nascar. A lot of families will lose everything. They will sift and disperse into the housing owned by other family members -- parents, siblings -- and a strange new not-altogether comfortable kind of togetherness will become common. Over time, a lot of people will go looking for casual work "under-the-table"( and probably low-paying). To some degree, these workers will begin to look and act like a new servant class, and before too long they may be absorbed into the households of people who employ them. There will be plenty of room for them there.
Counties, municipalities, and states will join in the bankruptcy fiesta. It would be reasonable to expect collapsing services as a result. This would be a situation fraught with danger -- of rising crime, of public health emergencies as water systems are not kept up and sewage treatment becomes unaffordable. I don't imagine the federal government stepping into every Podunk or Metropolis from sea to shining sea and propping up these services. People will have to cope with danger and deprivation.
2009 may be the point where we begin to understand what kinds of places will be more hospitable to human society further ahead. I maintain that our giant urban metroplexes have way overshot their sustainable scale and will contract severely. With all the economic hardship, we ought to expect a lot of demographic churning, people leaving hopeless places and moving on to something more promising. I believe we will see them move to smaller towns and smaller cities. The reorganization of the rural landscape into smaller-scaled farms has not begun to occur -- though 2009 might be very hard on agribusiness, given the shortage of capital and if oil begins to march up in price by late winter. Eventually, the rural landscape will require the labor of many more people than is currently the case. Whatever else happens, 2009 will surely see a massive return to home gardening as budgets become strained to the extreme. As the New Urbanist Andres Duany said recently, "Gardening is the new Golf!"
The oil scene
Many were stunned this year to witness the parabolic rise and fall of oil prices up to nearly $150 and then back around $36 by Christmas time. Quite a ride. I said in The Long Emergency that volatility would be the hallmark of post peak oil because it was obvious that advanced economies could not absorb super high prices and would crash in response; that at some point after crashing, these economies would respond to the new lower oil price, resume their cheap oil habits, and build to another price rise. . . and crash again. . . in a declension of ever-lower industrial activity.
What I probably didn't realize at the time was how destructive this cycling between low-high-and-low oil prices would actually be in the first instance of it, and what a toll it would take right off the bat. We can see now that our first journey through the cycle took out the most fragile of the complex systems we depend on: capital finance. As a result, a huge amount of capital (say $14 trillion) has evaporated out of the system, never to be seen again (and never to be deployed for productive purposes). It will be harder for the USA to rebound from the grievous injury to this crucial part of the overall system, and Europe has foundered similarly -- though the European nations are not burdened to the same degree by the awful liabilities of suburbia.
Even if these advanced economies -- throw in Japan too -- remain moribund, the price and supply prospects for oil look ominous. My own guess is that the price of oil has overshot on the low end just as it overshot on the high end, and that, when all is said and done, we'll still see an upwardly trending price line over the long haul. The plunge, which began right after the $147 peak in July 2008, was as much the result of banks, hedge funds, and individuals dumping oil investments and positions to raise cash as it was a matter of the markets predicting a sharp fall-off in economic activity (and supposedly oil consumption). The truth is that demand destruction for oil in the USA has been surprising mild compared to the drop in price. Jim Hansen's Master Resource Report says that gasoline consumption dropped from 9.29 million barrels a day in 2007 to 8.99 million barrels a day for 2008. That's not much of a fall-off, especially compared to the price drop.
As Julian Darley of the Post Carbon Institute put it recently: "There won't be any energy bail-out." And, as many other people have noted, the recent plunge in oil prices strongly implies future supply destruction, since so many planned oil projects have been suspended or cancelled because they are economic losers at $40-a-barrel (or even $70). Even projects well underway, such as Canadian tar sand production, have been scaled back or shut down because they don't make sense at current prices. Some of these other newer projects will now never get underway -- they have missed their window of opportunity with so much capital leaving the system -- and so the hope of offsetting very-near-future depletions in old giant oil fields looks dimmer and dimmer.
Those depletions are very serious. For instance, Mexico's super-giant Cantarell oil field, the second-largest ever discovered after Saudi Arabia's Ghawar field, has shown a 30 percent depletion rate in the past year alone. (Pemex had forecast a 15 percent rate entering the year.) Cantarell provides over 60 percent of Mexico's total production, and Mexico is America's third largest source of imports -- just after Saudi Arabia (#2) and Canada (#1). Obviously, Mexico soon will lose its ability to export oil, and as that occurs, America is going to feel more than pinch -- more like a two-by-four upside the head. In short, remorseless depletion is underway and we are less likely now than even a year ago, to make up for it.
At some point, then, demand, even if slightly lower, will catch up with declining supply. My prediction for 2009 is that we will see two things occur, possibly at the same time: a resumption of rising prices, and spot shortages. I say this because the global economic fiasco is sure to produce geopolitical friction, and inasmuch as America has to import almost three-quarters of the oil we use, the prospect for trouble is great.
The tragic part of all this, of course, is that the temporary plunge in oil prices has prompted an incurious American public to assume, once again, that the global oil predicament is some kind of a fraud. Given the flood tide of fraud they have been subject to in banking and investment matters, I suppose you can't blame them from thinking that everything is some kind of a scam. Given feeble car sales this season, there are reports that an increasing percentage of those sold now are are trucks and SUVs.
Though I give Boone Pickens high marks for stepping up to the leadership plate, I'm not altogether on board with his energy proposal for swapping natural gas for gasoline in motor fuels while we swap out wind power for natural gas in electric power generation. I don't believe that the ballyhooed shale-gas-plays of the last few years will prove-out long-term, as some huckster's claim. They are expensive to drill and run, and they all tend to deplete very quickly -- around one year. I'm not convinced we have the capital or the resources even to come up with the steel necessary to drill for it. Anyway, the last thing we need is a way to prolong our car-dependency.
In the meantime, there are still those who hope (as described above) that various alt.energy systems will insure the continuation of Happy Motoring. This is an idle hope, and 2009 will be very sobering for those who imagine that hybrid cars, or electric cars, or "air" cars, or natural gas cars, or any other kind of car technology will save the day. Even if President Obama mounts an "infrastructure stimulus" program, it will not keep up with all the necessary routine road repair that our highway system requires. The extreme financial hardship faced by localities and states insures that they will have to postpone a lot of expensive highway maintenance -- even if the federal government fixes a big bunch of bridges and tunnels -- and so we face the interesting prospect that our roadway systems will enter their own deadly zone of systemic failure even before the whole car issue is settled.
I am waiting to see whether Mr. Obama will undertake a restoration of passenger railroad service. I've said enough about this in the past, but it's worth reiterating that a failure to get comprehensive passenger rail service going will be a sign of how fundamentally unserious we are as a nation.
The Specter of Inflation
This is the "other shoe" that a lot of people are waiting to drop. Right now we are caught up in a compressive debt deflation as mortgages stop "performing" and loans of all kinds are welshed on. Since money is loaned into existence, and a great many loans are not being repaid, then a lot of money is going out of existence. That's what I mean when I say that capital is leaving the system. At the same time, the Federal Reserve has made good on its promise to drop money from helicopters if necessary to prevent an implosion of the banking system (as all that older money goes out of existence), and so it's now a question as to when the amount of new money will exceed the disappeared old money. (Of course when I say money, I mean "money," because we are dealing here in a shadow realm of assumed value.) In any case, there is bound to be a lag period between the time that the Fed's money is dropped from the choppers and the time it actually filters through the banks and other recipients to the so-called "real economy" of people who buy and sell real things. The credible estimates I hear run between six and 18 months.
I'll only venture to guess that we could see the start of serious inflation sometime in 2009. To some extent, all currencies are now free-falling together, some at slightly faster rates than others, but the situation of the US dollar is so grotesquely dire, and our structural imbalances so monumental, that it is hard to imagine that our currency will not win the international race to the bottom. Gold resumed its movement upward against the dollar a week before Christmas, and that may be an early sign. The government -- and anyone badly in debt -- benefits much more from inflation than deflation, so every effort will be made to avert the latter. The trouble lies in the government's dumb incapacity to control dangerous things that it sets in motion, so that an inflationary campaign to avoid compressive deflation can so easily lead to a fiasco of super or hyper inflation -- the kind that kills governments and turns societies into murderous monsters. I'll forecast the that the US dollar is worth 40 percent of its current value by next Christmas.
Geopolitics
Well, now, who the hell knows what's in store. Aside from a few bombs here and there, and pirates skulking around the horn of Africa, the world scene was miraculously free of major incidents in 2008 -- perhaps the worst being a toss up between the September [November, actually--P.Z.] Mumbai bombings and the fiasco in Georgia, where the US prompted Georgia President Mikheil Saakashvili to send troops into the South Ossetia region and the move was answered by overwhelming force from neighboring Russia, leaving the US looking feckless and retarded for our troubles. But otherwise, there wasn't a whole lot of action out there.
Until the last few days of the year, that is. I'm sure the ever-growing cohort of American anti-semites who send me emails will be tickled when I assert that the Hamas rocket attacks against Israel of recent days guaranteed a sharp response from Israel -- and now, of course, Hamas is playing the crybaby card: "... what'd we do to deserve this...?" Well, you fucking fired a bunch rockets into Israel. Did you ever hear of cause-and-effect? This matter requires no further elucidation, except that it seems to suggest a ramping back up of hostilities. I wonder if it is the beginning of a new coordinated offensive by Islamic extremism aimed at taking advantage of the West's current economic plight (and the West's probable aversion to anything that will complicate its desired recovery). We'll know in a month or so, I think, since any coordinated campaign (if such a thing were possible) might well be aimed at confounding the new American president.
The other hot corner of the world right now is the India-Pakistan border where the 60-year-old rivalry, which has already produced three wars, looks to be gearing up for yet another round. I'm not the first one to say that Pakistan is an extremely dangerous regional player, being an economic basket case, possessing a score or so of nuclear bombs, harboring more Islamic fundamentalist maniacs than any other place in the world, and having a government held together with duct tape and twine. The caper in Mumbai last September could well have been construed as an act of war, but somehow India kept its head. Who knows where this is going. . . .
So far I have only described what is already obviously going on. Add to this the likelihood that Iran is closer to achieving membership in the atomic weapon club. They've been spinning their centrifuges all year and nobody has done anything about it. My guess is that neither the US nor Israel will attempt to take out their facilities in the year ahead. If Iran used a nuclear device against Israel, or anybody else, they would be asking to become, in turn, the world's largest ashtray. End of story. A different story, though, is how Iran might behave if and when the US Military presence in Iraq is reduced. I can imagine Iran doing anything possible surreptitiously to gain control over Iraq's southern oil regions around Basra, but even the Iraqi Shia don't like the Iranian Shia that much. Anyway, iran's economy has suffered hugely from the fall in oil prices. That nation may be in for more internal trouble than they have seen in thirty years since the Shah was tossed out by the minions of Ayatollah Khomeini.
There's been a lot of sentiment the past year that as the US and the Europe fall into economic disarray, China would emerge as the great new hegemonic superpower. While it's come a long way in a quarter-century, China's internal problems are still enormous and worsening. They're in trouble with water, food imports, mass unemployment, and energy. They have locked in some oil contracts around the world, but they are still susceptible to vagaries in the oil markets and Black Swan events. As the US consumer economy falls into a coma, and the shipping containers from China to WalMart get sparser, the Chinese government will face the wrath of millions of unemployed workers. I believe they will struggle through 2009, perhaps growing more surly as the US dollar inflates and their holdings of treasury bills begins to look more like a swindle.
Russia may be suffering economically for the moment due to the crash of oil prices, but they are energy resource-rich -- at least for the next couple of decades -- and if they don't like the current price, they can keep more of their oil in the ground until the price looks more attractive. I think Mr. Putin has the confidence of the Russian people and will survive the current malaise.
Japan remains a riddle wrapped in toasted nori. They're beggaring their own factory workers to stay solvent. Their banking sector has been zombified for a generation. They import 95 percent of the energy they use. Do they have a plan? One can imagine them sliding in resignation back to something like the sixteenth century, giving up the whole industrial circus as more trouble than it's worth, just as they once gave up on firearms.
The over-arching geopolitical theme of 2009 will be the end of robust globalism as we've known it for some time. Reduced trade, competition for energy resources, sore feelings over debts and currencies will drive the nations inward or, at least, direct their energies toward their own regions. Note to Tom Friedman: the world turned out to be round after all.
Conclusion
The big theme for 2009 economically will be contraction. The end of the cheap energy era will announce itself as the end of conventional "growth" and the shrinking back of activity, wealth, and populations. Contraction will come as a great shock to a world of conventionally programmed economists. They will toil and sweat to account for it, and they will probably be wrong. Unfortunately, this contraction will do its work in unpleasant ways, driving down standards of living, shearing away hopes and expectations for a particular life of comfort, and introducing disorder to so many of the systems we have depended on for so long. People will starve, lose their homes, lose incomes and status, and lose the security of living in peaceful societies. It will become clear that the Long Emergency is underway.
My hope for the year, at least for my own society, is that we will transition away from being a nation of complacent, distracted, over-fed clowns, to become a purposeful and responsible people willing to put their shoulders to the wheel to get some things done. My motto for the new year: "no more crybabies!"
===
Saturday, December 27, 2008
The Grid
Our Christmas was fairly mellow. It was cold and overcast and I read one of my gifts, An Incomplete Education. Also I watched the marathon of A Christmas Story.
As it was snowing on the mainland, so was a storm brewing over Hawaii. About ten, we heard loud thunder and rain. Yesterday, the storm continued. Honolulu had a blackout, which really underscored how much people depend on electricity. Obama already had a generator in place, but HECO brought another one to supplement it.
That brings me to mention the book I bought as a gift for my father: Just in Case: How to be Self-Sufficient When the Unexpected Happens, by Kathy Harrison. The power grid is not as reliable as we think, even as demand for electricity increases. I recommend the book very much.
As it was snowing on the mainland, so was a storm brewing over Hawaii. About ten, we heard loud thunder and rain. Yesterday, the storm continued. Honolulu had a blackout, which really underscored how much people depend on electricity. Obama already had a generator in place, but HECO brought another one to supplement it.
That brings me to mention the book I bought as a gift for my father: Just in Case: How to be Self-Sufficient When the Unexpected Happens, by Kathy Harrison. The power grid is not as reliable as we think, even as demand for electricity increases. I recommend the book very much.
Wednesday, December 24, 2008
The Ocean of Babel
http://www.forbes.com/opinions/2008/12/22/internet-media-television-oped-cx_mk_1223kaylan.html
Interesting essay in Forbes about the Internet fragmenting everything. I'll have to read it more thoroughly but can, right now, disagree that the 'Net merely feeds users' tastes and reinforces their previously held ideas. Some things I just wouldn't have discovered without going online.
Interesting essay in Forbes about the Internet fragmenting everything. I'll have to read it more thoroughly but can, right now, disagree that the 'Net merely feeds users' tastes and reinforces their previously held ideas. Some things I just wouldn't have discovered without going online.
Wednesday, December 10, 2008
What Now? Hawaii Free Press Ascends Into the Aether
Hawaii Free Press is becoming a solely online paper. The 7 December print edition is its last. Editor-publisher Andrew Walden attributes his going online to the high cost in money and time of printing and distribution. Interestingly, HFP hadn't had a website until very recently.
Walden also points out the "Big Island newspaper-Democrat revolving door.":
"...[A] couple of quick items from local blogs which illustrate a permanent conflict of interest: reporters are eyeing a job in government. Since almost all elected positions are held by Democrats, this creates an unspoken alliance between journalists and Democratic Party candidates and officeholders."
One should find this dismaying, no matter what one's politics are.
==
11 January update: I just found this Big Island Chronicle post on HFP's becoming online only.
Walden also points out the "Big Island newspaper-Democrat revolving door.":
"...[A] couple of quick items from local blogs which illustrate a permanent conflict of interest: reporters are eyeing a job in government. Since almost all elected positions are held by Democrats, this creates an unspoken alliance between journalists and Democratic Party candidates and officeholders."
One should find this dismaying, no matter what one's politics are.
==
11 January update: I just found this Big Island Chronicle post on HFP's becoming online only.
Monday, December 08, 2008
'People Get Ready'
From Kunstler's latest column:
President-elect Obama has announced his intention to kick off a massive "stimulation" program when he hits the White House "running" in January. Early indications are that it will be directed at things like highway repair. If so, we will be investing long-term in infrastructure that we probably won't be using the same way in ten years. But I doubt there is any way around it. The American public can't conceive of living any other way except in a car-centered society. Anyway, some parts of our highway-bridge-and-tunnel system are already so decrepit that they pose a menace right now, and the clamor to direct "stimulation" there is already very strong -- backed by all the fraternities of engineers.
Stimulus aimed at perpetuating mass motoring will be a tragic waste of our dwindling resources. We'd be better off aiming it at fixing the railroads (especially electrifying them), refitting our harbors with piers and warehouses in preparation to move more stuff by boats, and in repairing the electric grid. Unfortunately, our tendency will be to try to rescue the totemic touchstones of everyday life, things familiar and comfortable, regardless of whether they have a future or not.
The ominous forces gathering out there will defeat these efforts and everyday life will reorganize itself some other way consistent with the single greatest trend: the force of contraction. Every sign we see is pointing in that direction, from the inability of the earth's ecology to support more human beings, to the dwindling of mineral and energy resources, to the destruction of farmland, to mischief in the climate. We just don't know how badly things will fall apart in the meantime, or how kind (or cruelly) people will act in the process.
Mr. Obama would be most successful if he could persuade the public how much more severe the required changes are than they currently realize, and inspire them to get with program of retrofitting American life to comply with these realities.
==
A recent article in The Hawaii Tribune-Herald quoted Hilo Harbormaster Ian Birnie on the state of Hilo's piers. I'll try to find the article.
President-elect Obama has announced his intention to kick off a massive "stimulation" program when he hits the White House "running" in January. Early indications are that it will be directed at things like highway repair. If so, we will be investing long-term in infrastructure that we probably won't be using the same way in ten years. But I doubt there is any way around it. The American public can't conceive of living any other way except in a car-centered society. Anyway, some parts of our highway-bridge-and-tunnel system are already so decrepit that they pose a menace right now, and the clamor to direct "stimulation" there is already very strong -- backed by all the fraternities of engineers.
Stimulus aimed at perpetuating mass motoring will be a tragic waste of our dwindling resources. We'd be better off aiming it at fixing the railroads (especially electrifying them), refitting our harbors with piers and warehouses in preparation to move more stuff by boats, and in repairing the electric grid. Unfortunately, our tendency will be to try to rescue the totemic touchstones of everyday life, things familiar and comfortable, regardless of whether they have a future or not.
The ominous forces gathering out there will defeat these efforts and everyday life will reorganize itself some other way consistent with the single greatest trend: the force of contraction. Every sign we see is pointing in that direction, from the inability of the earth's ecology to support more human beings, to the dwindling of mineral and energy resources, to the destruction of farmland, to mischief in the climate. We just don't know how badly things will fall apart in the meantime, or how kind (or cruelly) people will act in the process.
Mr. Obama would be most successful if he could persuade the public how much more severe the required changes are than they currently realize, and inspire them to get with program of retrofitting American life to comply with these realities.
==
A recent article in The Hawaii Tribune-Herald quoted Hilo Harbormaster Ian Birnie on the state of Hilo's piers. I'll try to find the article.
Thursday, December 04, 2008
Caught Out There
Lew Rockwell passes along David Gordon's pointing out a mistake by economist Brad DeLong, who then went into defense mode:
Writes David:
Did you see Brad DeLong's attack on Mises? He wrongly said that Mises cited two authors in a misleading way. When I pointed out that he himself failed to note that his citations to Theory of Money and Credit were to the 1944 appendix, not the original text, he almost immediately shut off comments. See the bottom of comments on the Mises entry .
---
All of the quotations from Mises are from the Appendix, "Planned Chaos", written in 1944. This isn't in the original edition.
Posted by: David Gordon | December 03, 2008 at 06:23 PM
OK. Time to cut this off and prune it down to something useful...
Posted by: Brad DeLong | December 03, 2008 at 06:34 PM
Mickslam, are you $%#$ kidding me? Taxes don't create demand, they substitute it. The money that was in the hand of the citizen was to be directed in a manner as he demanded, the government takes the money, and substitutes the demand for a government one, less, of course, the administrative costs of taking and spending it.
This is why the price level is not stable in a Keynesian system, but are in a long term trend increasing with periodic deflationary crashes.
Posted by: Mick | December 03, 2008 at 06:37 PM
could be a lot of pruning.
Posted by: Colin Danby | December 03, 2008 at 06:41 PM
Writes David:
Did you see Brad DeLong's attack on Mises? He wrongly said that Mises cited two authors in a misleading way. When I pointed out that he himself failed to note that his citations to Theory of Money and Credit were to the 1944 appendix, not the original text, he almost immediately shut off comments. See the bottom of comments on the Mises entry .
---
All of the quotations from Mises are from the Appendix, "Planned Chaos", written in 1944. This isn't in the original edition.
Posted by: David Gordon | December 03, 2008 at 06:23 PM
OK. Time to cut this off and prune it down to something useful...
Posted by: Brad DeLong | December 03, 2008 at 06:34 PM
Mickslam, are you $%#$ kidding me? Taxes don't create demand, they substitute it. The money that was in the hand of the citizen was to be directed in a manner as he demanded, the government takes the money, and substitutes the demand for a government one, less, of course, the administrative costs of taking and spending it.
This is why the price level is not stable in a Keynesian system, but are in a long term trend increasing with periodic deflationary crashes.
Posted by: Mick | December 03, 2008 at 06:37 PM
could be a lot of pruning.
Posted by: Colin Danby | December 03, 2008 at 06:41 PM
Sunday, November 30, 2008
The End of HunterBishop.com
David Hunter Bishop begins his new job as public information officer for Billy Kenoi, almost twenty years after he started writing for the Tribune-Herald.
Meanwhile, Kristine Kubat is poised to become East Hawaii's premier prog-blogger. Despite its absence from Hunter's blogroll, Kubehead is drawing an audience.
Meanwhile, Kristine Kubat is poised to become East Hawaii's premier prog-blogger. Despite its absence from Hunter's blogroll, Kubehead is drawing an audience.
Saturday, November 29, 2008
Unnecessary Name Changes
Steve Sailer takes on the Name Game:
They couldn't say "Terrorists Strike in Mumbai" because few of the local rag's readers know in what country "Mumbai" is. Readers have heard of "Bombay." They've eaten at Bombay Bicycle Club restaurants and they've bought end tables from Bombay Co. Furniture stores, so they mostly know Bombay is a city in India. But, Mumbai they don't know from Kolkata [Calcutta, naturally--P.Z.] or Chennai [Madras--P.Z.]. So, the headline writer has to refer to "Indian City" because the English-language media recently stopped using the place name that has been used in English for centuries.
The effect, of course, is what normally happens when names are changed. The Name Game just makes most people more ignorant (while giving a few people another reason to self-congratulate over their superior sensitivity). Older Americans who grew up hearing about Bombay can't understand today's news; and younger Americans who are growing up hearing about Mumbai won't be able to understand all the books in the library that refer to Bombay.
==
In his 1991 book, BAD: Or, the Dumbing of America, Paul Fussell opines:
"Intellectuals tend to go in for self-righteous enthusiasms, and it is they (as well as politicians) who lie behind the BAD idea of changing the names of their countries from time to time, making the study of history and geography more difficult than necessary. It is they who decide that Ceylon should now be known as Sri Lanka, Rhodesia as Zimbabwe, and Upper Volta as Burkina Faso."
They couldn't say "Terrorists Strike in Mumbai" because few of the local rag's readers know in what country "Mumbai" is. Readers have heard of "Bombay." They've eaten at Bombay Bicycle Club restaurants and they've bought end tables from Bombay Co. Furniture stores, so they mostly know Bombay is a city in India. But, Mumbai they don't know from Kolkata [Calcutta, naturally--P.Z.] or Chennai [Madras--P.Z.]. So, the headline writer has to refer to "Indian City" because the English-language media recently stopped using the place name that has been used in English for centuries.
The effect, of course, is what normally happens when names are changed. The Name Game just makes most people more ignorant (while giving a few people another reason to self-congratulate over their superior sensitivity). Older Americans who grew up hearing about Bombay can't understand today's news; and younger Americans who are growing up hearing about Mumbai won't be able to understand all the books in the library that refer to Bombay.
==
In his 1991 book, BAD: Or, the Dumbing of America, Paul Fussell opines:
"Intellectuals tend to go in for self-righteous enthusiasms, and it is they (as well as politicians) who lie behind the BAD idea of changing the names of their countries from time to time, making the study of history and geography more difficult than necessary. It is they who decide that Ceylon should now be known as Sri Lanka, Rhodesia as Zimbabwe, and Upper Volta as Burkina Faso."
Tuesday, November 25, 2008
The (Dis)United States of America
From the Drudge Report:
RUSSIAN ANALYST PREDICTS DECLINE AND BREAKUP OF USA
Tue Nov 25 2008 09:04:22 ET
A leading Russian political analyst has said the economic turmoil in the United States has confirmed his long-held view that the country is heading for collapse, and will divide into separate parts.
Professor Igor Panarin said in an interview with the respected daily IZVESTIA published on Monday: "The dollar is not secured by anything. The country's foreign debt has grown like an avalanche, even though in the early 1980s there was no debt. By 1998, when I first made my prediction, it had exceeded $2 trillion. Now it is more than 11 trillion. This is a pyramid that can only collapse."
The paper said Panarin's dire predictions for the U.S. economy, initially made at an international conference in Australia 10 years ago at a time when the economy appeared strong, have been given more credence by this year's events.
When asked when the U.S. economy would collapse, Panarin said: "It is already collapsing. Due to the financial crisis, three of the largest and oldest five banks on Wall Street have already ceased to exist, and two are barely surviving. Their losses are the biggest in history. Now what we will see is a change in the regulatory system on a global financial scale: America will no longer be the world's financial regulator."
When asked who would replace the U.S. in regulating world markets, he said: "Two countries could assume this role: China, with its vast reserves, and Russia, which could play the role of a regulator in Eurasia."
Asked why he expected the U.S. to break up into separate parts, he said: "A whole range of reasons. Firstly, the financial problems in the U.S. will get worse. Millions of citizens there have lost their savings. Prices and unemployment are on the rise. General Motors and Ford are on the verge of collapse, and this means that whole cities will be left without work. Governors are already insistently demanding money from the federal center. Dissatisfaction is growing, and at the moment it is only being held back by the elections and the hope that Obama can work miracles. But by spring, it will be clear that there are no miracles."
He also cited the "vulnerable political setup", "lack of unified national laws", and "divisions among the elite, which have become clear in these crisis conditions."
He predicted that the U.S. will break up into six parts - the Pacific coast, with its growing Chinese population; the South, with its Hispanics; Texas, where independence movements are on the rise; the Atlantic coast, with its distinct and separate mentality; five of the poorer central states with their large Native American populations; and the northern states, where the influence from Canada is strong.
He even suggested that "we could claim Alaska - it was only granted on lease, after all." Panarin, 60, is a professor at the Diplomatic Academy of the Russian Ministry of Foreign Affairs, and has authored several books on information warfare.
Developing...
RUSSIAN ANALYST PREDICTS DECLINE AND BREAKUP OF USA
Tue Nov 25 2008 09:04:22 ET
A leading Russian political analyst has said the economic turmoil in the United States has confirmed his long-held view that the country is heading for collapse, and will divide into separate parts.
Professor Igor Panarin said in an interview with the respected daily IZVESTIA published on Monday: "The dollar is not secured by anything. The country's foreign debt has grown like an avalanche, even though in the early 1980s there was no debt. By 1998, when I first made my prediction, it had exceeded $2 trillion. Now it is more than 11 trillion. This is a pyramid that can only collapse."
The paper said Panarin's dire predictions for the U.S. economy, initially made at an international conference in Australia 10 years ago at a time when the economy appeared strong, have been given more credence by this year's events.
When asked when the U.S. economy would collapse, Panarin said: "It is already collapsing. Due to the financial crisis, three of the largest and oldest five banks on Wall Street have already ceased to exist, and two are barely surviving. Their losses are the biggest in history. Now what we will see is a change in the regulatory system on a global financial scale: America will no longer be the world's financial regulator."
When asked who would replace the U.S. in regulating world markets, he said: "Two countries could assume this role: China, with its vast reserves, and Russia, which could play the role of a regulator in Eurasia."
Asked why he expected the U.S. to break up into separate parts, he said: "A whole range of reasons. Firstly, the financial problems in the U.S. will get worse. Millions of citizens there have lost their savings. Prices and unemployment are on the rise. General Motors and Ford are on the verge of collapse, and this means that whole cities will be left without work. Governors are already insistently demanding money from the federal center. Dissatisfaction is growing, and at the moment it is only being held back by the elections and the hope that Obama can work miracles. But by spring, it will be clear that there are no miracles."
He also cited the "vulnerable political setup", "lack of unified national laws", and "divisions among the elite, which have become clear in these crisis conditions."
He predicted that the U.S. will break up into six parts - the Pacific coast, with its growing Chinese population; the South, with its Hispanics; Texas, where independence movements are on the rise; the Atlantic coast, with its distinct and separate mentality; five of the poorer central states with their large Native American populations; and the northern states, where the influence from Canada is strong.
He even suggested that "we could claim Alaska - it was only granted on lease, after all." Panarin, 60, is a professor at the Diplomatic Academy of the Russian Ministry of Foreign Affairs, and has authored several books on information warfare.
Developing...
Thursday, November 20, 2008
What Now?
As far as I know, Hunter Bishop isn't linking to Kristine Kubat's new blog, Kubehead. It's as if he's hoping, maybe if I don't link to it, Kubehead will wither and die. Though off to a rough start, Kubat has this interesting post on the recent mmeting of Public Works and Planning. The Tribune-Herald reported on similarly lively meetings about Mauna Kea and the military.
Meanwhile, Ian Lind gives Andrew Walden props for his reporting on Hawaiian mortgage scams.
I have to credit Andrew Walden, who all too often slips far over the edge into ideological territory, for sticking largely to the record in his review of information available online concerning Mahealani Ventura-Oliver, the woman in the middle of an alleged scam aimed at Native Hawaiians. Walden follows many of the same sources cited here the past two days and is able to paint quite a picture of Ventura-Oliver and the larger network of which she is a part.
Meanwhile, Ian Lind gives Andrew Walden props for his reporting on Hawaiian mortgage scams.
I have to credit Andrew Walden, who all too often slips far over the edge into ideological territory, for sticking largely to the record in his review of information available online concerning Mahealani Ventura-Oliver, the woman in the middle of an alleged scam aimed at Native Hawaiians. Walden follows many of the same sources cited here the past two days and is able to paint quite a picture of Ventura-Oliver and the larger network of which she is a part.
Sunday, November 16, 2008
Wednesday, November 12, 2008
Overused Typeface: Copperplate Gothic
I had a hunch that Copperplate Gothic is overused. Searching online for "overused Copperplate Gothic," I found others who think so, too. But unlike those who want to get rid of it completely, I think CG is appropriate in some places. Papyrus, however, needs a long hibernation.
More later.
More later.
Thursday, November 06, 2008
The Wastrel Show: Cancelled?
Boomie of The Wastrel Show blog has endorsed McCain, praising him in many of her recent posts. So I wondered how she was taking Obama's victory. Apparently the blog's been taken down, which I find curious.
Neither candidate really was (or is) an advocate of frugality in government. Boomie might've considered Chuck Baldwin of the Constitution Party. After Ron Paul (who endorsed Baldwin), he was the thriftiest-minded presidential candidate this year.
From Wikipedia:
Economy
Baldwin says he would end all federal income taxes and phase out the Internal Revenue Service.[34]
Regarding tariffs, Baldwin has made conflicting statements. In an interview, he said "what I would propose is an across-the-board, general 10-percent tariff on all imports and that would meet the Constitution's prescription for financing the federal government—duties, imposts, tariffs"[47] which, he claims, would also help keep jobs in the United States.[48] But Baldwin's website says that "a tariff on foreign imports, based on the difference between the foreign item's cost of production abroad and the cost of production of a similar item produced in the United States, would be a Constitutional step toward a fair trade policy that would protect American jobs and, at the same time, raise revenue for our national government."[49]
He has said that as president he would streamline the federal government, and tap oil reserves in Alaska, the Dakotas, and the Gulf of Mexico. He believes the United States should return to the gold standard.[34]
Neither candidate really was (or is) an advocate of frugality in government. Boomie might've considered Chuck Baldwin of the Constitution Party. After Ron Paul (who endorsed Baldwin), he was the thriftiest-minded presidential candidate this year.
From Wikipedia:
Economy
Baldwin says he would end all federal income taxes and phase out the Internal Revenue Service.[34]
Regarding tariffs, Baldwin has made conflicting statements. In an interview, he said "what I would propose is an across-the-board, general 10-percent tariff on all imports and that would meet the Constitution's prescription for financing the federal government—duties, imposts, tariffs"[47] which, he claims, would also help keep jobs in the United States.[48] But Baldwin's website says that "a tariff on foreign imports, based on the difference between the foreign item's cost of production abroad and the cost of production of a similar item produced in the United States, would be a Constitutional step toward a fair trade policy that would protect American jobs and, at the same time, raise revenue for our national government."[49]
He has said that as president he would streamline the federal government, and tap oil reserves in Alaska, the Dakotas, and the Gulf of Mexico. He believes the United States should return to the gold standard.[34]
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