https://www.peakprosperity.com/blog/114625/festering-social-rift-over-pensions
The Festering Social Rift Over Pensions
Why does he get to retire and I don't?
Most Americans will never be able to afford to retire.
We laid out the depressing math in our recent report Will Your Retirement Efforts Achieve Escape Velocity?:
The median retirement account balance among all working US adults is $0. This is true even for the cohort closest to retirement age, those 55-64 years old.
The average (i.e., mean) near-retirement individual has less than 8% of one year's income saved in a retirement account
77% of all American households aren't on track to have enough net worth to retire, even under the most conservative estimates.
There a number of causal factors that have contributed to this lack of retirement preparedness (decades of stagnant real wages, fast-rising cost of living, the Great Recession, etc), but as we explained in our report The Great Retirement Con, perhaps none has had more impact than the shift from dedicated-contribution pension plans to voluntary private savings:
The Origins Of The Retirement Plan
Back during the Revolutionary War, the Continental Congress promised a monthly lifetime income to soldiers who fought and survived the conflict. This guaranteed income stream, called a "pension", was again offered to soldiers in the Civil War and every American war since.
Since then, similar pension promises funded from public coffers expanded to cover retirees from other branches of government. States and cities followed suit -- extending pensions to all sorts of municipal workers ranging from policemen to politicians, teachers to trash collectors.
A pension is what's referred to as a defined benefit plan. The payout promised a worker upon retirement is guaranteed up front according to a formula, typically dependent on salary size and years of employment.
Understandably, workers appreciated the security and dependability offered by pensions. So, as a means to attract skilled talent, the private sector started offering them, too.
The first corporate pension was offered by the American Express Company in 1875. By the 1960s, half of all employees in the private sector were covered by a pension plan.
Off-loading Of Retirement Risk By Corporations
Once pensions had become commonplace, they were much less effective as an incentive to lure top talent. They started to feel like burdensome cost centers to companies.
As America's corporations grew and their veteran employees started hitting retirement age, the amount of funding required to meet current and future pension funding obligations became huge. And it kept growing. Remember, the Baby Boomer generation, the largest ever by far in US history, was just entering the workforce by the 1960s.
Companies were eager to get this expanding liability off of their backs. And the more poorly-capitalized firms started defaulting on their pensions, stiffing those who had loyally worked for them.
So, it's little surprise that the 1970s and '80s saw the introduction of personal retirement savings plans. The Individual Retirement Arrangement (IRA) was formed by the Employee Retirement Income Security Act (ERISA) in 1974. And the first 401k plan was created in 1980.
These savings vehicles are defined contribution plans. The future payout of the plan is variable (i.e., unknown today), and will be largely a function of how much of their income the worker directs into the fund over their career, as well as the market return on the fund's investments.
Touted as a revolutionary improvement for the worker, these plans promised to give the individual power over his/her own financial destiny. No longer would it be dictated by their employer.
Your company doesn't offer a pension? No worries: open an IRA and create your own personal pension fund.
Afraid your employer might mismanage your pension fund? A 401k removes that risk. You decide how your retirement money is invested.
Want to retire sooner? Just increase the percent of your annual income contributions.
All this sounded pretty good to workers. But it sounded GREAT to their employers.
Why? Because it transferred the burden of retirement funding away from the company and onto its employees. It allowed for the removal of a massive and fast-growing liability off of the corporate balance sheet, and materially improved the outlook for future earnings and cash flow.
As you would expect given this, corporate America moved swiftly over the next several decades to cap pension participation and transition to defined contribution plans.
The table below shows how vigorously pensions (green) have disappeared since the introduction of IRAs and 401ks (red):
So, to recap: 40 years ago, a grand experiment was embarked upon. One that promised US workers: Using these new defined contribution vehicles, you'll be better off when you reach retirement age.
Which raises a simple but very important question: How have things worked out?
The Ugly Aftermath
America The Broke
Well, things haven't worked out too well.
Four decades later, what we're realizing is that this shift from dedicated-contribution pension plans to voluntary private savings was a grand experiment with no assurances. Corporations definitely benefited, as they could redeploy capital to expansion or bottom line profits. But employees? The data certainly seems to show that the experiment did not take human nature into account enough – specifically, the fact that just because people have the option to save money for later use doesn't mean that they actually will.
And so we end up with the dismal retirement stats bulleted above.
The Income Haves & Have-Nots
In our recent report The Primacy Of Income, we summarized our years-long predictions of a coming painful market correction followed by a prolonged era of no capital gains across equities, bond and real estate.
Simply put: the 'easy' gains made over the past 8 years as the central banks did their utmost to inflate asset prices is over. Asset appreciation is going to be a lot harder to come by in the future.
Which makes income now the prime source of building -- or simply just maintaining -- wealth going forward.
That being the case, it's obvious that those receiving a pension will be in far better shape than those who aren't. They'll have a guaranteed income stream to partially or fully fund their retirement.
Resentment Brewing
While the total number of people expecting a pension isn't tiny, it's certainly a minority of today's workers.
31 million private-sector, state and local government workers in the US participate in a pension plan. 3.3 million currently-employed civilian Federal workers will receive a pension; as will some percentage of the 2 million people serving in the active military and reserves.
Combined, that's about 25% of current US workers; roughly 13% of total US adults.
Now that the Everything Bubble is bursting and a return to economic recession appears increasingly probable within the next year or two, the disparity in prospects between these 35 million future pensioners and the rest of the workforce will become increasingly obvious.
The danger here is of festering social discord. The majority, whom we already know will not be able to retire, will highly likely start regarding pensioners with envy and resentment.
"Hey, I worked as hard as Joe during my career. How come he gets to retire and I don't?" will be a common narrative running in the minds of those jealous of their neighbors.
This bitterness will only increase as taxes continue to rise to fund government pension payouts, already a huge drain on public budgets. "Why am I paying more so Joe can relax on the beach??"
Humans are wired to react angrily to perceived injustice and unfairness. This short clip shows how it's hard-coded into our primate brains:
So it's not a stretch at all to predict the divisive tension and prejudice that will result from the growing gap between the pension haves and have-nots.
The negative stereotypes of union workers will be tightly re-embraced. This SNL sketch captures a good number of them:
The steady news reports of pension fraud and abuse will anger the majority further. Any projected decreases in Social Security (benefit payouts will only be 79 cents on the dollar by 2035 at our current trajectory) will only exacerbate the ire, as the small governmental income the have-nots receive becomes even more meager.
The growing potential here is for an emerging social schism, possibly accompanied with intimidation and violence, not dissimilar to that which has occurred along racial or religious lines during darker eras of our history.
As people become stressed, they react emotionally, and look for a culprit to blame. And as they become more desperate, as many elderly workers with no savings often do, they'll resort to more desperate measures.
Broken Promises
And it's not all sunshine and roses for the pensioners, either. Being promised a pension and actually receiving one are two very different things.
Underfunded pension liabilities are a massive ticking time bomb, certain to explode over the next few decades.
For example, many pensions offered through multi-employer plans are bad shape. The multiemployer branch of the Pension Benefit Guaranty Corporation, the federally-instated insurer behind private pensions, will be out of business by 2025 if no changes in law are made to help. If that happens, retirees in those plans will get only 10% of what they were promised.
Moreover, research conducted by the Pew Charitable Trusts shows a $1.4 trillion shortfall between state pension assets and guarantees to employees. There are only two ways a gap that big gets addressed: massive tax hikes or massive benefit cuts. The likeliest outcome will be a combination of both.
So, many of those today counting on a pension tomorrow may find themselves in a similar boat to their pension-less neighbors.
No Easy Systemic Solutions, So Act For Yourself
There's no "fix" to the retirement predicament of the American workforce. There's no policy change that can be made at this late date to reverse the decades of over-spending, over-indebtedness, and lack of saving.
All we can do at this time is influence how we take our licks. Do we simply leave the masses of unprepared workers to their sad fate? Or do we share the pain across the entire populace by funding new social support programs via more taxes?
Time will tell. But what we can bet on is tougher times ahead, especially for those with poor income prospects....
Saturday, December 15, 2018
Friday, December 14, 2018
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https://caitlinjohnstone.com/2018/12/14/watch-break-free-from-the-corporate-prison-my-latest-video-collaboration-with-sustainable-human/
Watch Break Free From The Corporate Prison, my latest video collaboration with Sustainable Human
https://www.youtube.com/watch?v=hfRhmvIHgmY
Watch Break Free From The Corporate Prison, my latest video collaboration with Sustainable Human
https://www.youtube.com/watch?v=hfRhmvIHgmY
SC179-4
https://www.oftwominds.com/blog.html
Neofeudalism Isn't a Flaw of the System--It's the System Working Perfectly
I've been writing about neofeudalism and its cousin neocolonialism for seven years:
500 Million Debt-Serfs: The European Union Is a Neo-Feudal Kleptocracy (July 22, 2011)
The E.U., Neofeudalism and the Neocolonial-Financialization Model (May 24, 2012)
The basic idea here is the socio-economic-political system is structured such that the only possible output is neofeudalism. In other words, neofeudalism isn't a flaw in the system that can be changed with policy tweaks or electing a new president or PM-- it's the result of the system working as designed.
Neofeudalism is a peculiarly invisible hierarchical structure of power: The New Nobility (or aristocracy if you prefer) wields vast concentrations of political, social and financial power, and does so without the formalized aristocrat-serf relationships and obligations of classic neofeudalism.
We appear to be free but we're powerless to change the power asymmetry between the New Nobility and the commoners. This reality is reified into social relations that are simulacra of actual power, pantomimes acted out in media-theaters to instill the belief that the foundational myths of democracy and social mobility are real rather than misleading shadows.
Neofeudalism is fundamentally a financial-political arrangement, marketed and managed by cultural elites who strive to convince us that we still have some shreds of power. These elites have a variety of tools at their disposal. One has been described by filmmaker Adam Curtis as pantomime: Trump says/does something outrageous, the Democrats cry "impeachment," and so on.
This theater of pantomime serves two purposes: it projects a simulation of functional democracy that makes us believe impeaching one president and getting another one in office will change anything about the neofeudal power structure; it won't.
The theater of pantomime also distracts us from the remarkably stable asymmetry of power in our social-political-financial construct: various ambiguities are blown into "the most important issue of today," a revolving performance in which virtue-signaling has replaced actual action to remedy the vast imbalances of power, and appeals to myths that no longer manifest in the real world (democracy and social mobility) are used to suppress and marginalize the search for new structures that would upend the cozy incest of neofeudalism's financial and political power.
I discuss the structure of neofeudalism in my new book Pathfinding our Destiny: Preventing the Final Fall of Our Democratic Republic at some length, and one key takeaway is this: $100 million invested in influencing the central state guarantees $1 billion in private-sector profits. Or $10 billion. The point is the return on investment is unbeatable, and so is the security of the gains.
This marriage of state power to create credit and its monopoly on force with private-sector financial power is the core relation of neofeudalism. The only possible output of this structure is a mass of powerless debt-serfs enriching the New Nobility, who are slavishly served by a nomenklatura class of "liberal" technocrats and managers tasked with promoting pantomimes and simulacra as "the real thing."
Despite the ubiquity and sophistication of this marketing and management machinery, the debt-serfs sense the entire system is both false and precarious, two intimately related realities, for fakery is always precarious: the truth about the asymmetries of power might slip out and spread like wildfire.
Neofeudalism Isn't a Flaw of the System--It's the System Working Perfectly
I've been writing about neofeudalism and its cousin neocolonialism for seven years:
500 Million Debt-Serfs: The European Union Is a Neo-Feudal Kleptocracy (July 22, 2011)
The E.U., Neofeudalism and the Neocolonial-Financialization Model (May 24, 2012)
The basic idea here is the socio-economic-political system is structured such that the only possible output is neofeudalism. In other words, neofeudalism isn't a flaw in the system that can be changed with policy tweaks or electing a new president or PM-- it's the result of the system working as designed.
Neofeudalism is a peculiarly invisible hierarchical structure of power: The New Nobility (or aristocracy if you prefer) wields vast concentrations of political, social and financial power, and does so without the formalized aristocrat-serf relationships and obligations of classic neofeudalism.
We appear to be free but we're powerless to change the power asymmetry between the New Nobility and the commoners. This reality is reified into social relations that are simulacra of actual power, pantomimes acted out in media-theaters to instill the belief that the foundational myths of democracy and social mobility are real rather than misleading shadows.
Neofeudalism is fundamentally a financial-political arrangement, marketed and managed by cultural elites who strive to convince us that we still have some shreds of power. These elites have a variety of tools at their disposal. One has been described by filmmaker Adam Curtis as pantomime: Trump says/does something outrageous, the Democrats cry "impeachment," and so on.
This theater of pantomime serves two purposes: it projects a simulation of functional democracy that makes us believe impeaching one president and getting another one in office will change anything about the neofeudal power structure; it won't.
The theater of pantomime also distracts us from the remarkably stable asymmetry of power in our social-political-financial construct: various ambiguities are blown into "the most important issue of today," a revolving performance in which virtue-signaling has replaced actual action to remedy the vast imbalances of power, and appeals to myths that no longer manifest in the real world (democracy and social mobility) are used to suppress and marginalize the search for new structures that would upend the cozy incest of neofeudalism's financial and political power.
I discuss the structure of neofeudalism in my new book Pathfinding our Destiny: Preventing the Final Fall of Our Democratic Republic at some length, and one key takeaway is this: $100 million invested in influencing the central state guarantees $1 billion in private-sector profits. Or $10 billion. The point is the return on investment is unbeatable, and so is the security of the gains.
This marriage of state power to create credit and its monopoly on force with private-sector financial power is the core relation of neofeudalism. The only possible output of this structure is a mass of powerless debt-serfs enriching the New Nobility, who are slavishly served by a nomenklatura class of "liberal" technocrats and managers tasked with promoting pantomimes and simulacra as "the real thing."
Despite the ubiquity and sophistication of this marketing and management machinery, the debt-serfs sense the entire system is both false and precarious, two intimately related realities, for fakery is always precarious: the truth about the asymmetries of power might slip out and spread like wildfire.
SC179-3
http://www.informationclearinghouse.info/50759.htm
US Meltdown Over TU-160s
Two long-range Russian bombers landed in Venezuela this week and the United States immediately flew into a fit of rage. Top diplomat Mike Pompeo had a virtual mental meltdown on Twitter, denouncing Russia and the South American country for daring to cooperate in holding a military exercise.
The TU-160s flew nearly 10,000 kilometres from Russia to Venezuela on a scheduled non-stop flight in order to demonstrate Moscow's support for the government of President Nicolas Maduro. The week before, Maduro was hosted in Moscow by President Vladimir Putin during which the two leaders discussed closer cooperation in economic and military affairs.
The Venezuelan government has had close ties with Russia over the past two decades since the late socialist leader Hugo Chavez and his successor Maduro have been in power. The South American oil-producing giant has been threatened with US military aggression and sanctions which have caused havoc for its economy. Russia is promising to help stabilize the country with oil and other investments.
Thus, there was nothing improper about the two Russian warplanes flying to Caracas. It wasn't the first time either. Five years ago, the TU-160s reportedly made a similar itinerary.
However, from the way US Secretary of State Mike Pompeo reacted, one might have thought that Russia and Venezuela were hatching a sinister scheme.
"Russia's government has sent bombers halfway around the world to Venezuela," Pompeo fumed, according to Reuters reporting.
He then went on to vent his fury with gratuitously nasty remarks about both countries.
"The Russian and Venezuelan people should see this for what it is: two corrupt governments squandering public funds, and squelching liberty and freedom while their people suffer."
Kremlin spokesman Dmitry Peskov slammed Pompeo's "undiplomatic" language and vacuous reasoning. In an apt counter-dig over the allegation of squandering public funds, Peskov noted that the annual US military spending of over $700 billion (more than 10 times Russia's military budget) could feed the whole of Africa — if it were allocated to such a worthy cause.
Neither is the US is any position to lecture others about "squelching liberty and freedom". Almost every week, American bombs kill countless civilians in Afghanistan, Syria and Yemen, while US troops are present in 150 countries around the world (80 per cent of all nations), with 800 bases in some 70 foreign states.
A reliable study of US wars and clandestine military interventions carried out in some 37 nations around the world during the decades since World War Two estimates the total number of deaths caused among mainly civilian populations at between 20-30 million. Those military onslaughts, such as the Vietnam War (3 million deaths), were declared to be in the name of "freedom" and "democracy" by the "leader of the free world".
Such grotesque falsification of monumental crimes is what you call "propaganda", systemized by Western media who have never told the unvarnished truth about the criminality of Washington and its allies.
Propaganda is what pathetic politicians like Mike Pompeo are full of. You know these American politicians are full of it because of their obtuse double-think.
Pompeo was reacting to Russian bombers flying to Venezuela because that country is considered by US imperialists to be in its "backyard". In truth, the whole planet is considered to be America's backyard when it has 800 military bases around the globe.
The distance between Caracas and Florida is nearly 2,450 kilometres. From the Venezuelan capital to Washington DC it is 3,300 km.
Now check out Pompeo's rampant double-think. Only last month, the US-led NATO military alliance held its biggest-ever war exercises in Scandinavia and the Baltic Sea — at a distance of 500 km from Russia's northern border. The NATO Trident Juncture 2018 manoeuvres involved the deployment of 250 warplanes and 65 warships, including the nuclear-capable aircraft carrier USS Harry S Truman.
Earlier this year, in July, the US Navy held its biggest NATO exercises in the Black Sea on Russia's southern shores. Participating in those exercises were Ukrainian forces, even though Ukraine is not officially yet a member of NATO and even though the Neo-fascist regime in Kiev has repeatedly uttered crazed anti-Russian statements.
Let's take this double-think to a sublime level. On November 26, the US-backed Kiev regime staged a military provocation against Russia with three warships violating Russia's maritime territory. The Kiev regime and Washington then turned around and accused Moscow of "aggression" after Russia detained the offending vessels near the Kerch Strait — a few km from the Russian mainland.
Last week, on December 6 — four days before the Russian TU-160s bombers landed in Venezuela (2,450 km from Florida!) on a scheduled trip between two allied nations — the US air force dispatched a surveillance plane over Ukraine on Russia's western border. It was described by gung-ho US channel Fox News as an "extraordinary flight" over Ukraine "in response to Russia's unprovoked attack".
Onboard the US surveillance warplane was military personnel from Britain, France, Germany — and Ukraine, the very regime which staged the provocation in the Kerch Strait only days before.
The Fox News report continues: "The Open Skies flight [on December 6] also took place one day after a US Navy guided-missile destroyer sailed into waters claimed [sic] by Russia… near the port city of Vladivostok, home to Russia's Pacific Fleet. It was the first such voyage for the US Navy in Russia's contested waters since 1987."
So there you have it. US forces are marauding and menacing Russian territory almost non-stop with hundreds of warplanes and ships, from north, south, east and west. And yet when two Russian bombers land in Venezuela, Washington goes into paroxysms of indignation. That is a measure of how irrational and brain-dead the American political class are. Their capacity for double-think is limitless because of the propagandized fantasy world they have come to perceive as reality.
It's impossible to rationalize with such people through reasonable dialogue. The only language that might get through to them is a show of force when their idiocy goes too far.
Russian forces in Venezuela are not even comparable to US forces in Ukraine or the Baltic Sea in terms of proximity. Cuba would be more appropriate. But they are perhaps enough to show the arrogant buffoons in Washington that there is a tolerance limit for American aggression.
For the sake of peace, everyone needs to de-escalate military forces eventually. But the onus for that move is patently on the US with its global sprawl of war machines and outrageous attitude of impunity from sticking its weapons in the faces of other countries.
This harks to the Cuban Missile crisis of 1962. Why should US military forces be permitted to threaten others halfway around the world, and expect no reciprocal response? The days of American bullying double-think are long over. Fortunately, too, paradoxically, for the sake of world peace.
US Meltdown Over TU-160s
Two long-range Russian bombers landed in Venezuela this week and the United States immediately flew into a fit of rage. Top diplomat Mike Pompeo had a virtual mental meltdown on Twitter, denouncing Russia and the South American country for daring to cooperate in holding a military exercise.
The TU-160s flew nearly 10,000 kilometres from Russia to Venezuela on a scheduled non-stop flight in order to demonstrate Moscow's support for the government of President Nicolas Maduro. The week before, Maduro was hosted in Moscow by President Vladimir Putin during which the two leaders discussed closer cooperation in economic and military affairs.
The Venezuelan government has had close ties with Russia over the past two decades since the late socialist leader Hugo Chavez and his successor Maduro have been in power. The South American oil-producing giant has been threatened with US military aggression and sanctions which have caused havoc for its economy. Russia is promising to help stabilize the country with oil and other investments.
Thus, there was nothing improper about the two Russian warplanes flying to Caracas. It wasn't the first time either. Five years ago, the TU-160s reportedly made a similar itinerary.
However, from the way US Secretary of State Mike Pompeo reacted, one might have thought that Russia and Venezuela were hatching a sinister scheme.
"Russia's government has sent bombers halfway around the world to Venezuela," Pompeo fumed, according to Reuters reporting.
He then went on to vent his fury with gratuitously nasty remarks about both countries.
"The Russian and Venezuelan people should see this for what it is: two corrupt governments squandering public funds, and squelching liberty and freedom while their people suffer."
Kremlin spokesman Dmitry Peskov slammed Pompeo's "undiplomatic" language and vacuous reasoning. In an apt counter-dig over the allegation of squandering public funds, Peskov noted that the annual US military spending of over $700 billion (more than 10 times Russia's military budget) could feed the whole of Africa — if it were allocated to such a worthy cause.
Neither is the US is any position to lecture others about "squelching liberty and freedom". Almost every week, American bombs kill countless civilians in Afghanistan, Syria and Yemen, while US troops are present in 150 countries around the world (80 per cent of all nations), with 800 bases in some 70 foreign states.
A reliable study of US wars and clandestine military interventions carried out in some 37 nations around the world during the decades since World War Two estimates the total number of deaths caused among mainly civilian populations at between 20-30 million. Those military onslaughts, such as the Vietnam War (3 million deaths), were declared to be in the name of "freedom" and "democracy" by the "leader of the free world".
Such grotesque falsification of monumental crimes is what you call "propaganda", systemized by Western media who have never told the unvarnished truth about the criminality of Washington and its allies.
Propaganda is what pathetic politicians like Mike Pompeo are full of. You know these American politicians are full of it because of their obtuse double-think.
Pompeo was reacting to Russian bombers flying to Venezuela because that country is considered by US imperialists to be in its "backyard". In truth, the whole planet is considered to be America's backyard when it has 800 military bases around the globe.
The distance between Caracas and Florida is nearly 2,450 kilometres. From the Venezuelan capital to Washington DC it is 3,300 km.
Now check out Pompeo's rampant double-think. Only last month, the US-led NATO military alliance held its biggest-ever war exercises in Scandinavia and the Baltic Sea — at a distance of 500 km from Russia's northern border. The NATO Trident Juncture 2018 manoeuvres involved the deployment of 250 warplanes and 65 warships, including the nuclear-capable aircraft carrier USS Harry S Truman.
Earlier this year, in July, the US Navy held its biggest NATO exercises in the Black Sea on Russia's southern shores. Participating in those exercises were Ukrainian forces, even though Ukraine is not officially yet a member of NATO and even though the Neo-fascist regime in Kiev has repeatedly uttered crazed anti-Russian statements.
Let's take this double-think to a sublime level. On November 26, the US-backed Kiev regime staged a military provocation against Russia with three warships violating Russia's maritime territory. The Kiev regime and Washington then turned around and accused Moscow of "aggression" after Russia detained the offending vessels near the Kerch Strait — a few km from the Russian mainland.
Last week, on December 6 — four days before the Russian TU-160s bombers landed in Venezuela (2,450 km from Florida!) on a scheduled trip between two allied nations — the US air force dispatched a surveillance plane over Ukraine on Russia's western border. It was described by gung-ho US channel Fox News as an "extraordinary flight" over Ukraine "in response to Russia's unprovoked attack".
Onboard the US surveillance warplane was military personnel from Britain, France, Germany — and Ukraine, the very regime which staged the provocation in the Kerch Strait only days before.
The Fox News report continues: "The Open Skies flight [on December 6] also took place one day after a US Navy guided-missile destroyer sailed into waters claimed [sic] by Russia… near the port city of Vladivostok, home to Russia's Pacific Fleet. It was the first such voyage for the US Navy in Russia's contested waters since 1987."
So there you have it. US forces are marauding and menacing Russian territory almost non-stop with hundreds of warplanes and ships, from north, south, east and west. And yet when two Russian bombers land in Venezuela, Washington goes into paroxysms of indignation. That is a measure of how irrational and brain-dead the American political class are. Their capacity for double-think is limitless because of the propagandized fantasy world they have come to perceive as reality.
It's impossible to rationalize with such people through reasonable dialogue. The only language that might get through to them is a show of force when their idiocy goes too far.
Russian forces in Venezuela are not even comparable to US forces in Ukraine or the Baltic Sea in terms of proximity. Cuba would be more appropriate. But they are perhaps enough to show the arrogant buffoons in Washington that there is a tolerance limit for American aggression.
For the sake of peace, everyone needs to de-escalate military forces eventually. But the onus for that move is patently on the US with its global sprawl of war machines and outrageous attitude of impunity from sticking its weapons in the faces of other countries.
This harks to the Cuban Missile crisis of 1962. Why should US military forces be permitted to threaten others halfway around the world, and expect no reciprocal response? The days of American bullying double-think are long over. Fortunately, too, paradoxically, for the sake of world peace.
Thursday, December 13, 2018
SC179-2
https://medium.com/insurge-intelligence/brexit-stage-one-in-europes-slow-burn-energy-collapse-1f520d7e2d89
Brexit: stage one in Europe’s slow-burn energy collapse
The Brexit fiasco and French riots are accelerating symptoms of Europe’s earth system crisis
Everyone’s talking about Brexit. Some about the French riots. But no one’s talking about why they are happening, and what they really mean. They might think they are, but they are usually missing the point.
On 6th May 2010, the Conservative Party took the reins of power for the first time since 1992, propped up with some help from the Liberal Democrats. Hours before the election result, I warned in a blog post that whichever government was elected, it would be the first step in a dramatic shift toward the far-right that would likely sweep across the Western world within 10 years.
“The new government, beholden to conventional wisdom, will be unable or unwilling to get to grips with the root structural causes of the current convergence of crises facing this country, and the world,” I wrote, describing the failure of all three political parties to understand why the heyday of economic growth was unlikely to return.
“This suggests that in 5–10 years, the entire mainstream party-political system in this country, and many Western countries, will be completely discredited as crises continue to escalate while mainstream policy solutions serve largely to contribute to them, not ameliorate them. The collapse of the mainstream party-political system across the liberal democratic heartlands could pave the way for the increasing legitimization of far-right politics by the end of this decade…”
My prediction was astonishingly prescient. The global shift to the far-right began within exactly five years of my forecast, and has continued to accelerate before the decade is even out.
In 2014, far-right parties won 172 seats in the European Union elections — just under a quarter of all seats in the European Parliament. In 2015, David Cameron was re-elected as Prime Minister with a parliamentary majority, a victory attributed in part to his promise to hold a referendum on Britain’s membership of the European Union.
Unbeknownst to many, the Tories had quietly established wide-ranging links with many of the same far-right parties that were now capturing seats in the EU.
Return of the Reich
An independent INSURGEintelligence investigative project commissioned by TELL MAMA. Dedicated to Jo Cox, her family…
medium.com
The following year in June, the ‘Brexit’ referendum shocked the world with its result: a majority vote to leave the EU.
Six months later, billionaire real estate guru Donald Trump shocked the world again when he became president of the world’s most powerful country. Like the Conservatives in the UK, the Republicans too had forged trans-Atlantic connections with European parties and movements of the extreme-right. Since then, far-right parties have made continued electoral gains across Europe in Italy, Sweden, Germany, France, Poland and Hungary.
We are on the cusp of a tidal wave, that looks poised to accelerate into a tsunami. Exactly as I had anticipated, far-right politics is no longer the province of the fringe, but is becoming increasingly normalised. This not an accident. It is the result of a system that is failing — and the efforts of a network of far-right groups to exploit the fractures emerging from this system-failure to tear everything down, and erect a new order of their own fashioning.
My prediction of the resurgence of the far-right was based on analysing the probable consequences of a long-term ‘system-failure’ in which we are unable to return to the levels of economic growth we had become accustomed to in the heyday of the 1980s and 90s. That system-failure, I explained, is rooted in the economics of the energy production that enables economic growth:
“…. a full and lasting recovery… is likely to be impossible in the constraints of the current system, because we’re running short on the physical basis of the last few decades of exponential (and fluctuating) ‘growth’ — and that is cheap, easily available hydrocarbon energies, primarily oil, gas and coal.
The turning point has arrived, and without that global cheap energy source in abundant supply, we cannot continue growing, no matter what we do. Something has to give. Our economies need to be fundamentally, structurally, transformed. We need to transition to a new, clean, renewable energy system on which to base our economies. We need to transform the way money is created, so that it’s not linked to the systematic generation of debt. We need to transform our banking system on the same grounds. Whitehall, and the three political parties, recognize only facets of the picture, but they don’t see it as a whole.”
Turning point
The energy turning point is unequivocal. In the years preceding the historic Brexit referendum, and the marked resurgence of nationalist, populist and far-right movements across Europe, the entire continent has faced a quietly brewing energy crisis.
Europe is now a ‘post-peak oil’ continent. Currently, every single major oil producer in Western Europe is in decline. According to data from BP’s 2018 Statistical Review of Energy, Western European oil production peaked between 1996 and 2002. Since then, production had declined while net imports have gradually increased.
In a two-part study published in 2016 and 2017 in the Springer journal, BioPhysical Economics and Resource Quality, Michael Dittmar, Senior Scientist at the ETH Zurich Institute for Particle Physics and CERN, developed a new empirical model of oil production and consumption.
A Regional Oil Extraction and Consumption Model. Part II: Predicting the Declines in Regional Oil…
In Part I of this analysis, the striking similarities of the declining oil production in the North Sea, Indonesia and…
link.springer.com
The study provides perhaps one of the most empirically-robust models of oil production and consumption to date, but its forecast was sobering.
Noting that oil exports from Russia and former Soviet Union countries are set to decline, Dittmar found that Western Europe will find it difficult to replace these lost exports. As a result, “total consumption in Western Europe is predicted to be about 20 percent lower in 2020 than it was in 2015.”
The only region of the world where production will be stable for the next 15 to 20 years is the OPEC Middle East. Everywhere else, concludes Dittmar, production will decline by around 3 to 5 percent a year after 2020. And in some regions, this decline has already started.
Not everyone agrees that a steep decline in Russia’s oil production is imminent. Last year, the Oxford Institute for Energy Studies argued that Russian production could probably continue to grow out to at least 2020. How long it would last thereafter was unclear.
On the other hand, the Russian government’s own energy experts are worried. In September 2018, Russia’s energy minister Alexander Novak warned that Russia’s oil production might peak within three years due to mounting production costs and taxes. In the ensuing two decades, Russia could lose almost half its current capacity. This sobering assessment is still broadly consistent with the Oxford study.
The following month, Dr Kent Moor of the Energy Capital Research Group, who has advised 27 governments around the world including the US and Russia, argued that Russia is scraping the bottom of the barrel in its prize Western Siberia basin.
Moor cited internal Russian Ministry of Energy reports from 2016 warning of a “Western Siberia rapid decline curve amounting to a loss of some 8.5 percent in volume by 2022. Some of this is already underway.” Although Russia is actively pursuing alternative strategies, wrote Moor, these are all “inordinately expensive”, and might produce only temporary results.
It’s not that the oil is running out. The oil is there in abundance — more than enough to fry the planet several times over. The challenge is that we are relying less on cheap crude oil and more on expensive, dirtier and unconventional fossil fuels. Energetically, this stuff is more challenging to get out and less potent after extraction than crude.
The bottom line is that as Europe’s domestic oil supplies slowly dwindle, there is no meaningful strategy to wean ourselves off abject dependence on Russia; the post-carbon transition is consistently too little, too late; and the impact on Europe’s economies — if business-as-usual continues — will continue to unravel the politics of the union.
While very few are talking about Europe’s slow-burn energy crisis, the reality is that as Europe’s own fossil fuel resources are inexorably declining, and as producers continue to face oil price volatility amidst persistently higher costs of production, Europe’s economy will suffer.
In September, I reported exclusively on the findings of an expert report commissioned by the scientific group working on the forthcoming UN’s Sustainability Report.
This is how UN scientists are preparing for the end of capitalism
Capitalism as we know it is over. So suggests a new report commissioned by a group of scientists appointed by the UN…
www.independent.co.uk
The report underscored that cheap energy flows are the lifeblood of economic growth: and that as we shift into an era of declining resource quality, we are likely to continue seeing slow, weak if not declining economic growth.
This is happening at a global scale. EROI is already beginning to approach levels seen in the nineteenth century — demonstrating how constrained global economic growth might be due to declining net energy returns to society.
Inside the new economic science of capitalism’s slow-burn energy collapse
And why the struggle for a new economic paradigm is about to get real
medium.com
Britain: the end of net energy growth
Britain, which is due to leave the European Union on 29th March 2019, is a poster boy for this brewing energy-economic crisis.
In January 2017, the Centre for Climate Change Economics and Policy run by the University of Leeds and London School of Economics, produced a startling analysis of Britain’s declining net energy problem. The study attempted to develop a methodology to examine national-level figures for Energy Return on Investment (EROI) — the amount of energy one uses to extract a particular quantity of energy.
The goal of the study was to pinpoint the EROI value as much as possible using Britain as a prime case-study. The concept of EROI fleshes out the recognition that a significant surplus of energy is required to fuel economic activity, separate to energy that is consumed precisely to extract energy in the first place.
The less energy we use to get new energy out, the more energy we have left to invest in the wider goods and services of economic activity. But if we keep using more energy just to get energy out, the amount of net energy we have left to fuel our economies decreases.
According to the study authors, Lina Brand-Correa, Paul Brockway, Claire Carter, Tim Foxon, Anne Owen and Peter Taylor:
“The higher the EROI of an energy supply technology, the more ‘valuable’ it is in terms of producing (economically) useful energy output. In other words, a higher EROI allows for more net energy to be available to the economy, which is valuable in the sense that all economic activity relies on energy use to a greater or lesser extent.”
The verdict on the UK predicament is stark. They find that “the UK as a whole has had a declining EROI in the first decade of the 21st century, going from 9.6 in 2000 to 6.2 in 2012… These initial results show that more and more energy is having to be used in the extraction of energy itself rather than by the UK’s economy or society.”
Citing the work of French economists Florian Fizaine and Vincent Court, which estimates a minimal societal EROI of 11 for continuous economic growth, the paper concludes:
“… the UK is below that benchmark.”
In other words, early last year, a major scientific study found that for the last two decades and beyond, Britain’s economic growth is fundamentally constrained by domestic net energy decline. But this groundbreaking news did not make the ‘news’.
Break-up
At the close of 2010, in my book A User’s Guide to the Crisis of Civilization, I predicted that large trans-national state structures like the European Union are likely to face challenges to their territorial integrity as a side-effect of these processes. The failure to address the systemic causes behind the 2008 financial crash, the incapacity to recognise it as a symptom of a system in decline, would lead to an increasingly authoritarian politics.
A User's Guide to the Crisis of Civilization
It often seems that different crises are competing to devastate civilisation. This book argues that financial meltdown…
www.plutobooks.com
The integrity of large trans-national structures depends on the abundance of cheap energy flows to sustain them. If those flows come at greater cost and lower quality, then those structures will become increasingly strained and potentially even begin to break down. Costs to keep the system going increase while returns are squeezed, meaning that the surplus to invest in core social goods to maintain such structures declines.
That is why despite the so-called ‘recovery’ — tepid as it is and based on accelerating debt levels (in biophysical terms borrowing from the Earth today with promise of paying it back tomorrow with what has already been over consumed today) — in real terms, peoples’ purchasing power continues to decline.
The failure to understand and engage with the root, systemic causes of the crisis also means that policymakers put themselves in a position where they can only address surface-symptoms.
All too often, that means short-term, reactionary responses. And so in France, instead of addressing the question of how to galvanise a third industrial revolution to speed a post-carbon transition and infrastructure revival, Macron’s response to the climate crisis was to protect fossil fuel and nuclear producers while hiking up fuel taxes. He didn’t want to tackle the horrendous supply chains of big French corporations. He didn’t want to penalise the powerful oil, gas and nuclear lobbies that he hopes might help him get re-elected, and did next to nothing to speed a viable post-carbon transition that might transform economic prosperity on more sustainable foundations.
And so by placing the burden almost exclusively on French workers and consumers, Macron triggered the spiral of rage and riots. Protestors have set fire to banks, smashed and looted shops, and even targeted the Arc de Triomphe. They demand an end to corporate freeloading, along with nationalist demands such as ‘Frexit’, France’s departure from the EU, and preventing migration. It is telling that while some demands are compelling, there is no semblance of understanding the real planetary crisis beyond banal tropes about Big Banks. The French state has responded with its own violence, firing water cannons and tear gas on protestors, arresting over a thousand people, and threatening to bring in the French Army.
This is a microcosm of what can happen when states and peoples both fail to understand the deeper dynamics of a failing system: everyone responds to what is in front of them. Protestors blame Macron. The French state cracks down on violence. Politics becomes militarised, while scepticism of the liberal incumbency across the political spectrum finds vindication.
France’s riots therefore did not come out of the blue. They are part and parcel of a wider process of slow-burn EROI decline in which the returns to society from economic activity are being increasingly constrained by the higher energetic costs of that activity and productivity declines of the ageing centralised industrial-era infrastructure and technology. It was only a matter of time before the average person began to feel the impact of that squeeze in their day to day lives. Macron’s tax hikes were not the cause, but the trigger. They lit the match, but the tinder box was already fuming.
Brexit
But we’ve been here before, in Syria and beyond.
Brexit was triggered in the context of global system dynamics which remain poorly understood. Over the decade preceding the 2008 financial crisis, Britain’s economic growth was being undermined not merely by a debt-bubble in the housing markets, but by an ailing fossil fuel dependent energy system.
That ailing system was indelibly linked to the European migrant crisis, which saw over a million refugees from the Middle East and North Africa seeking sanctuary across Europe, including the UK and France, that fuelled the surge in nationalist populism sweeping across the continent.
The migrant crisis, too, did not come out of the blue, but followed hot on the heels of the turbulence of the Arab Spring. The destabilisation of Syria, Egypt, Yemen and beyond was a long time coming — but it was triggered by a perfect storm of crises. Domestic oil production declines which pulled the rug out from beneath oil-export dependent state revenues conspired with global oil price spikes thanks to the plateauing in world production of cheap conventional oil. A string of climate crises across the world’s major food basket regions led to crop failures and droughts which boosted food price spikes.
Global systemic crisis interacted with the breakdown in local national systems. As I’d reported in 2013, a natural drought cycle in Syria was massively worsened due to climate change, devastating agriculture and driving hundreds of thousands of Sunni farmers into Alawite-dominated coastal cities. As Syrian oil revenues plummeted, its domestic conventional oil production having peaked in the mid-1990s, the government’s slashing of critical fuel and food subsidies just as prices were spiking globally was the last straw. People could not even afford bread, so they hit the streets.
Peak oil, climate change and pipeline geopolitics driving Syria conflict | Nafeez Ahmed
Nafeez Ahmed: Root-cause environmental and energy factors driving violence will continue to destabilise Arab world…
www.theguardian.com
Bashar al-Assad responded with escalating brutality, including shooting civilians in the streets. When protestors picked up arms in response, the cycle of violence kicked in. Outside powers intervened to coopt their favoured sides, Russia and Iran backing Assad, the West backing various rebel groups — neither particularly interested in supporting Syrian civil society. The conflict escalated, devastating the country, and fuelling an unprecedented refugee crisis.
STATE PROPAGANDA IN SYRIA: FROM WAR CRIMES TO PIPELINES [ISCI Report]
ISCI is a cross-disciplinary research centre working to further our understanding of state crime: organisational…
statecrime.org
When NATO intervened in Libya, when the US and UK backed Saudi Arabia’s indiscriminate aerial bombardment of Yemen, it only destabilised the region further. The arc of collapse across the Middle East and North Africa resulted from a fatal combination: an earth system crisis, compounded by short-sighted and self-serving responses from human systems.
When families and children began turning up in their droves on European shores, the earth system crisis ‘out there’ came home. The West could not shield itself from the long-range consequences of the unsustainability of the very postwar system it had nurtured since the Second World War: structural dependence on fossil fuels, a patchwork of alliances with regional despotic regimes, laying the groundwork for converging climate change, crude oil depletion and the resulting domino effect of food and economic crises.
The earth system crisis that erupted in Syria triggered a wave of human system destabilisation of which Brexit was merely the first eruption.
And so the Syria crisis is indeed a taste of things to come. Europe is already a post-peak oil continent, whose domestic fossil resources are in decline. Most credible studies of Europe’s shale gas potential show that it is extremely weak and not similar to the American situation. If we are hell-bent on maintaining dependence on fossil fuels, we will be forced to import.
But as I showed in my scientific monograph for Springer Energy Briefs, Failing States, Collapsing Systems: BioPhysical Triggers of Political Violence (2017), if demand growth increases at current rates, it is unlikely that Central Asian and Russian suppliers will be capable of meeting that demand at costs we can cope with in coming decades.
Failing States, Collapsing Systems - BioPhysical Triggers of Political Violence | Nafeez Mosaddeq…
This work executes a unique transdisciplinary methodology building on the author's previous book, A User's Guide to the…
www.springer.com
Meanwhile, certain climate impacts are already locked in. Between 2030 and 2045, large parts of the Middle East and North Africa (MENA) are likely to become increasingly uninhabitable due to climate change. This is the same period in which oil production across the MENA region has been forecast to begin plateauing and declining. As the energy costs of fossil fuel production and imports increases, and as the EU is likely hit again by the challenge of large-scale migration from the Middle East due to climate devastation, the challenges to the EU’s territorial integrity will not go away.
Brexit is merely a ripple on the surface of deeper currents. It is a symptom of the great civilisational phase-shift to life after fossil fuels.
In this sense, the Brexit fiasco is an example of how distant we are as a species from the conversations we need to be having. Talking about being in or out of Europe and in what way is not unimportant, but it’s also a massive distraction from the deeper systemic crisis that is unfolding beneath the very issues driving our immediate concerns about Brexit.
Earth system disruption does not inevitably result in destabilisation of human systems. But if human systems refuse to engage and adapt to those disruptions, then they will be destabilised. As long as Britain, Europe and their citizens continue to obsess myopically on the symptoms rather than the causes, we will be incapable of responding meaningfully to those causes. Instead, we will fight with each other manically about the symptoms, while the ground beneath our feet continues to unravel.
The crisis of Brexit and the eruption of the riots in France are symptoms of a great unfolding civilizational transition, in which an old reductionist paradigm of materialist self-maximation is dying. Citizens and policymakers, activists and business leaders, need to wake up to what is actually happening to have the conversations that can kick-start meaningful approaches to systemic transformation.
This is not a far-flung crisis that is going to happen years in the future. This is now. This is happening and it is affecting you, your children, and those you love the most. And it will affect their children, and their children....
Brexit: stage one in Europe’s slow-burn energy collapse
The Brexit fiasco and French riots are accelerating symptoms of Europe’s earth system crisis
Everyone’s talking about Brexit. Some about the French riots. But no one’s talking about why they are happening, and what they really mean. They might think they are, but they are usually missing the point.
On 6th May 2010, the Conservative Party took the reins of power for the first time since 1992, propped up with some help from the Liberal Democrats. Hours before the election result, I warned in a blog post that whichever government was elected, it would be the first step in a dramatic shift toward the far-right that would likely sweep across the Western world within 10 years.
“The new government, beholden to conventional wisdom, will be unable or unwilling to get to grips with the root structural causes of the current convergence of crises facing this country, and the world,” I wrote, describing the failure of all three political parties to understand why the heyday of economic growth was unlikely to return.
“This suggests that in 5–10 years, the entire mainstream party-political system in this country, and many Western countries, will be completely discredited as crises continue to escalate while mainstream policy solutions serve largely to contribute to them, not ameliorate them. The collapse of the mainstream party-political system across the liberal democratic heartlands could pave the way for the increasing legitimization of far-right politics by the end of this decade…”
My prediction was astonishingly prescient. The global shift to the far-right began within exactly five years of my forecast, and has continued to accelerate before the decade is even out.
In 2014, far-right parties won 172 seats in the European Union elections — just under a quarter of all seats in the European Parliament. In 2015, David Cameron was re-elected as Prime Minister with a parliamentary majority, a victory attributed in part to his promise to hold a referendum on Britain’s membership of the European Union.
Unbeknownst to many, the Tories had quietly established wide-ranging links with many of the same far-right parties that were now capturing seats in the EU.
Return of the Reich
An independent INSURGEintelligence investigative project commissioned by TELL MAMA. Dedicated to Jo Cox, her family…
medium.com
The following year in June, the ‘Brexit’ referendum shocked the world with its result: a majority vote to leave the EU.
Six months later, billionaire real estate guru Donald Trump shocked the world again when he became president of the world’s most powerful country. Like the Conservatives in the UK, the Republicans too had forged trans-Atlantic connections with European parties and movements of the extreme-right. Since then, far-right parties have made continued electoral gains across Europe in Italy, Sweden, Germany, France, Poland and Hungary.
We are on the cusp of a tidal wave, that looks poised to accelerate into a tsunami. Exactly as I had anticipated, far-right politics is no longer the province of the fringe, but is becoming increasingly normalised. This not an accident. It is the result of a system that is failing — and the efforts of a network of far-right groups to exploit the fractures emerging from this system-failure to tear everything down, and erect a new order of their own fashioning.
My prediction of the resurgence of the far-right was based on analysing the probable consequences of a long-term ‘system-failure’ in which we are unable to return to the levels of economic growth we had become accustomed to in the heyday of the 1980s and 90s. That system-failure, I explained, is rooted in the economics of the energy production that enables economic growth:
“…. a full and lasting recovery… is likely to be impossible in the constraints of the current system, because we’re running short on the physical basis of the last few decades of exponential (and fluctuating) ‘growth’ — and that is cheap, easily available hydrocarbon energies, primarily oil, gas and coal.
The turning point has arrived, and without that global cheap energy source in abundant supply, we cannot continue growing, no matter what we do. Something has to give. Our economies need to be fundamentally, structurally, transformed. We need to transition to a new, clean, renewable energy system on which to base our economies. We need to transform the way money is created, so that it’s not linked to the systematic generation of debt. We need to transform our banking system on the same grounds. Whitehall, and the three political parties, recognize only facets of the picture, but they don’t see it as a whole.”
Turning point
The energy turning point is unequivocal. In the years preceding the historic Brexit referendum, and the marked resurgence of nationalist, populist and far-right movements across Europe, the entire continent has faced a quietly brewing energy crisis.
Europe is now a ‘post-peak oil’ continent. Currently, every single major oil producer in Western Europe is in decline. According to data from BP’s 2018 Statistical Review of Energy, Western European oil production peaked between 1996 and 2002. Since then, production had declined while net imports have gradually increased.
In a two-part study published in 2016 and 2017 in the Springer journal, BioPhysical Economics and Resource Quality, Michael Dittmar, Senior Scientist at the ETH Zurich Institute for Particle Physics and CERN, developed a new empirical model of oil production and consumption.
A Regional Oil Extraction and Consumption Model. Part II: Predicting the Declines in Regional Oil…
In Part I of this analysis, the striking similarities of the declining oil production in the North Sea, Indonesia and…
link.springer.com
The study provides perhaps one of the most empirically-robust models of oil production and consumption to date, but its forecast was sobering.
Noting that oil exports from Russia and former Soviet Union countries are set to decline, Dittmar found that Western Europe will find it difficult to replace these lost exports. As a result, “total consumption in Western Europe is predicted to be about 20 percent lower in 2020 than it was in 2015.”
The only region of the world where production will be stable for the next 15 to 20 years is the OPEC Middle East. Everywhere else, concludes Dittmar, production will decline by around 3 to 5 percent a year after 2020. And in some regions, this decline has already started.
Not everyone agrees that a steep decline in Russia’s oil production is imminent. Last year, the Oxford Institute for Energy Studies argued that Russian production could probably continue to grow out to at least 2020. How long it would last thereafter was unclear.
On the other hand, the Russian government’s own energy experts are worried. In September 2018, Russia’s energy minister Alexander Novak warned that Russia’s oil production might peak within three years due to mounting production costs and taxes. In the ensuing two decades, Russia could lose almost half its current capacity. This sobering assessment is still broadly consistent with the Oxford study.
The following month, Dr Kent Moor of the Energy Capital Research Group, who has advised 27 governments around the world including the US and Russia, argued that Russia is scraping the bottom of the barrel in its prize Western Siberia basin.
Moor cited internal Russian Ministry of Energy reports from 2016 warning of a “Western Siberia rapid decline curve amounting to a loss of some 8.5 percent in volume by 2022. Some of this is already underway.” Although Russia is actively pursuing alternative strategies, wrote Moor, these are all “inordinately expensive”, and might produce only temporary results.
It’s not that the oil is running out. The oil is there in abundance — more than enough to fry the planet several times over. The challenge is that we are relying less on cheap crude oil and more on expensive, dirtier and unconventional fossil fuels. Energetically, this stuff is more challenging to get out and less potent after extraction than crude.
The bottom line is that as Europe’s domestic oil supplies slowly dwindle, there is no meaningful strategy to wean ourselves off abject dependence on Russia; the post-carbon transition is consistently too little, too late; and the impact on Europe’s economies — if business-as-usual continues — will continue to unravel the politics of the union.
While very few are talking about Europe’s slow-burn energy crisis, the reality is that as Europe’s own fossil fuel resources are inexorably declining, and as producers continue to face oil price volatility amidst persistently higher costs of production, Europe’s economy will suffer.
In September, I reported exclusively on the findings of an expert report commissioned by the scientific group working on the forthcoming UN’s Sustainability Report.
This is how UN scientists are preparing for the end of capitalism
Capitalism as we know it is over. So suggests a new report commissioned by a group of scientists appointed by the UN…
www.independent.co.uk
The report underscored that cheap energy flows are the lifeblood of economic growth: and that as we shift into an era of declining resource quality, we are likely to continue seeing slow, weak if not declining economic growth.
This is happening at a global scale. EROI is already beginning to approach levels seen in the nineteenth century — demonstrating how constrained global economic growth might be due to declining net energy returns to society.
Inside the new economic science of capitalism’s slow-burn energy collapse
And why the struggle for a new economic paradigm is about to get real
medium.com
Britain: the end of net energy growth
Britain, which is due to leave the European Union on 29th March 2019, is a poster boy for this brewing energy-economic crisis.
In January 2017, the Centre for Climate Change Economics and Policy run by the University of Leeds and London School of Economics, produced a startling analysis of Britain’s declining net energy problem. The study attempted to develop a methodology to examine national-level figures for Energy Return on Investment (EROI) — the amount of energy one uses to extract a particular quantity of energy.
The goal of the study was to pinpoint the EROI value as much as possible using Britain as a prime case-study. The concept of EROI fleshes out the recognition that a significant surplus of energy is required to fuel economic activity, separate to energy that is consumed precisely to extract energy in the first place.
The less energy we use to get new energy out, the more energy we have left to invest in the wider goods and services of economic activity. But if we keep using more energy just to get energy out, the amount of net energy we have left to fuel our economies decreases.
According to the study authors, Lina Brand-Correa, Paul Brockway, Claire Carter, Tim Foxon, Anne Owen and Peter Taylor:
“The higher the EROI of an energy supply technology, the more ‘valuable’ it is in terms of producing (economically) useful energy output. In other words, a higher EROI allows for more net energy to be available to the economy, which is valuable in the sense that all economic activity relies on energy use to a greater or lesser extent.”
The verdict on the UK predicament is stark. They find that “the UK as a whole has had a declining EROI in the first decade of the 21st century, going from 9.6 in 2000 to 6.2 in 2012… These initial results show that more and more energy is having to be used in the extraction of energy itself rather than by the UK’s economy or society.”
Citing the work of French economists Florian Fizaine and Vincent Court, which estimates a minimal societal EROI of 11 for continuous economic growth, the paper concludes:
“… the UK is below that benchmark.”
In other words, early last year, a major scientific study found that for the last two decades and beyond, Britain’s economic growth is fundamentally constrained by domestic net energy decline. But this groundbreaking news did not make the ‘news’.
Break-up
At the close of 2010, in my book A User’s Guide to the Crisis of Civilization, I predicted that large trans-national state structures like the European Union are likely to face challenges to their territorial integrity as a side-effect of these processes. The failure to address the systemic causes behind the 2008 financial crash, the incapacity to recognise it as a symptom of a system in decline, would lead to an increasingly authoritarian politics.
A User's Guide to the Crisis of Civilization
It often seems that different crises are competing to devastate civilisation. This book argues that financial meltdown…
www.plutobooks.com
The integrity of large trans-national structures depends on the abundance of cheap energy flows to sustain them. If those flows come at greater cost and lower quality, then those structures will become increasingly strained and potentially even begin to break down. Costs to keep the system going increase while returns are squeezed, meaning that the surplus to invest in core social goods to maintain such structures declines.
That is why despite the so-called ‘recovery’ — tepid as it is and based on accelerating debt levels (in biophysical terms borrowing from the Earth today with promise of paying it back tomorrow with what has already been over consumed today) — in real terms, peoples’ purchasing power continues to decline.
The failure to understand and engage with the root, systemic causes of the crisis also means that policymakers put themselves in a position where they can only address surface-symptoms.
All too often, that means short-term, reactionary responses. And so in France, instead of addressing the question of how to galvanise a third industrial revolution to speed a post-carbon transition and infrastructure revival, Macron’s response to the climate crisis was to protect fossil fuel and nuclear producers while hiking up fuel taxes. He didn’t want to tackle the horrendous supply chains of big French corporations. He didn’t want to penalise the powerful oil, gas and nuclear lobbies that he hopes might help him get re-elected, and did next to nothing to speed a viable post-carbon transition that might transform economic prosperity on more sustainable foundations.
And so by placing the burden almost exclusively on French workers and consumers, Macron triggered the spiral of rage and riots. Protestors have set fire to banks, smashed and looted shops, and even targeted the Arc de Triomphe. They demand an end to corporate freeloading, along with nationalist demands such as ‘Frexit’, France’s departure from the EU, and preventing migration. It is telling that while some demands are compelling, there is no semblance of understanding the real planetary crisis beyond banal tropes about Big Banks. The French state has responded with its own violence, firing water cannons and tear gas on protestors, arresting over a thousand people, and threatening to bring in the French Army.
This is a microcosm of what can happen when states and peoples both fail to understand the deeper dynamics of a failing system: everyone responds to what is in front of them. Protestors blame Macron. The French state cracks down on violence. Politics becomes militarised, while scepticism of the liberal incumbency across the political spectrum finds vindication.
France’s riots therefore did not come out of the blue. They are part and parcel of a wider process of slow-burn EROI decline in which the returns to society from economic activity are being increasingly constrained by the higher energetic costs of that activity and productivity declines of the ageing centralised industrial-era infrastructure and technology. It was only a matter of time before the average person began to feel the impact of that squeeze in their day to day lives. Macron’s tax hikes were not the cause, but the trigger. They lit the match, but the tinder box was already fuming.
Brexit
But we’ve been here before, in Syria and beyond.
Brexit was triggered in the context of global system dynamics which remain poorly understood. Over the decade preceding the 2008 financial crisis, Britain’s economic growth was being undermined not merely by a debt-bubble in the housing markets, but by an ailing fossil fuel dependent energy system.
That ailing system was indelibly linked to the European migrant crisis, which saw over a million refugees from the Middle East and North Africa seeking sanctuary across Europe, including the UK and France, that fuelled the surge in nationalist populism sweeping across the continent.
The migrant crisis, too, did not come out of the blue, but followed hot on the heels of the turbulence of the Arab Spring. The destabilisation of Syria, Egypt, Yemen and beyond was a long time coming — but it was triggered by a perfect storm of crises. Domestic oil production declines which pulled the rug out from beneath oil-export dependent state revenues conspired with global oil price spikes thanks to the plateauing in world production of cheap conventional oil. A string of climate crises across the world’s major food basket regions led to crop failures and droughts which boosted food price spikes.
Global systemic crisis interacted with the breakdown in local national systems. As I’d reported in 2013, a natural drought cycle in Syria was massively worsened due to climate change, devastating agriculture and driving hundreds of thousands of Sunni farmers into Alawite-dominated coastal cities. As Syrian oil revenues plummeted, its domestic conventional oil production having peaked in the mid-1990s, the government’s slashing of critical fuel and food subsidies just as prices were spiking globally was the last straw. People could not even afford bread, so they hit the streets.
Peak oil, climate change and pipeline geopolitics driving Syria conflict | Nafeez Ahmed
Nafeez Ahmed: Root-cause environmental and energy factors driving violence will continue to destabilise Arab world…
www.theguardian.com
Bashar al-Assad responded with escalating brutality, including shooting civilians in the streets. When protestors picked up arms in response, the cycle of violence kicked in. Outside powers intervened to coopt their favoured sides, Russia and Iran backing Assad, the West backing various rebel groups — neither particularly interested in supporting Syrian civil society. The conflict escalated, devastating the country, and fuelling an unprecedented refugee crisis.
STATE PROPAGANDA IN SYRIA: FROM WAR CRIMES TO PIPELINES [ISCI Report]
ISCI is a cross-disciplinary research centre working to further our understanding of state crime: organisational…
statecrime.org
When NATO intervened in Libya, when the US and UK backed Saudi Arabia’s indiscriminate aerial bombardment of Yemen, it only destabilised the region further. The arc of collapse across the Middle East and North Africa resulted from a fatal combination: an earth system crisis, compounded by short-sighted and self-serving responses from human systems.
When families and children began turning up in their droves on European shores, the earth system crisis ‘out there’ came home. The West could not shield itself from the long-range consequences of the unsustainability of the very postwar system it had nurtured since the Second World War: structural dependence on fossil fuels, a patchwork of alliances with regional despotic regimes, laying the groundwork for converging climate change, crude oil depletion and the resulting domino effect of food and economic crises.
The earth system crisis that erupted in Syria triggered a wave of human system destabilisation of which Brexit was merely the first eruption.
And so the Syria crisis is indeed a taste of things to come. Europe is already a post-peak oil continent, whose domestic fossil resources are in decline. Most credible studies of Europe’s shale gas potential show that it is extremely weak and not similar to the American situation. If we are hell-bent on maintaining dependence on fossil fuels, we will be forced to import.
But as I showed in my scientific monograph for Springer Energy Briefs, Failing States, Collapsing Systems: BioPhysical Triggers of Political Violence (2017), if demand growth increases at current rates, it is unlikely that Central Asian and Russian suppliers will be capable of meeting that demand at costs we can cope with in coming decades.
Failing States, Collapsing Systems - BioPhysical Triggers of Political Violence | Nafeez Mosaddeq…
This work executes a unique transdisciplinary methodology building on the author's previous book, A User's Guide to the…
www.springer.com
Meanwhile, certain climate impacts are already locked in. Between 2030 and 2045, large parts of the Middle East and North Africa (MENA) are likely to become increasingly uninhabitable due to climate change. This is the same period in which oil production across the MENA region has been forecast to begin plateauing and declining. As the energy costs of fossil fuel production and imports increases, and as the EU is likely hit again by the challenge of large-scale migration from the Middle East due to climate devastation, the challenges to the EU’s territorial integrity will not go away.
Brexit is merely a ripple on the surface of deeper currents. It is a symptom of the great civilisational phase-shift to life after fossil fuels.
In this sense, the Brexit fiasco is an example of how distant we are as a species from the conversations we need to be having. Talking about being in or out of Europe and in what way is not unimportant, but it’s also a massive distraction from the deeper systemic crisis that is unfolding beneath the very issues driving our immediate concerns about Brexit.
Earth system disruption does not inevitably result in destabilisation of human systems. But if human systems refuse to engage and adapt to those disruptions, then they will be destabilised. As long as Britain, Europe and their citizens continue to obsess myopically on the symptoms rather than the causes, we will be incapable of responding meaningfully to those causes. Instead, we will fight with each other manically about the symptoms, while the ground beneath our feet continues to unravel.
The crisis of Brexit and the eruption of the riots in France are symptoms of a great unfolding civilizational transition, in which an old reductionist paradigm of materialist self-maximation is dying. Citizens and policymakers, activists and business leaders, need to wake up to what is actually happening to have the conversations that can kick-start meaningful approaches to systemic transformation.
This is not a far-flung crisis that is going to happen years in the future. This is now. This is happening and it is affecting you, your children, and those you love the most. And it will affect their children, and their children....
Wednesday, December 12, 2018
SC179-1
https://www.oftwominds.com/blog.html
France in a Nutshell: "The Government Stopped Listening to the People 20 Years Ago"
A family member who has lived in France for decades summarized the source of the gilets jaunes protests in one sentence: "The government stopped listening to the people 20 years ago. It would be difficult to deny the generalization of this: many if not most governments stopped listening to their people decades ago, preferring instead to listen to financial and political elites and entrenched cultural elites who view commoners with disdain.
Legions of commentators are weighing in on the economic and cultural sources of France's distemper. Many have characterized the protests as working class, broadly speaking, the multitudes who have seen an erosion in the purchasing power of their wages or pensions while France's financial, political and cultural elites have feasted on whatever meager gains the French economy has registered in the past 20 years.
The protesters rightly perceive that they are politically invisible: the ruling class, regardless of its ideological flavor, doesn't believe it needs the support of the I>politically invisible to rule as it sees fit. The ruling class has counted on the cultural elites to marginalize and suppress the politically invisible by dismissing any working-class dissent as racist, fascist, nationalistic and other words expressly intended to push dissent into the political wilderness.
The cultural elites reckoned their ceaseless depiction of working-class dissent as racist-fascist populism would continue marginalizing the commoners, but the worm has turned: the financially, politically and culturally marginalized classes are fed up.
Despite the usual squabbles between factions, the ruling class has long been united behind a simple tool of control: buy complicity with government benefits. Should dissent boil up in a broad-based movement, the solution is buy the protesters off with some new state subsidy or benefit.
This is one of the essential dynamics of Neofeudalism which are:
1. Debt penury and wage-slave loyalty to the New Nobility that owns the debt.
2. The financial-political nobility maximize their skim and justify this exploitation with airy assurances to the politically impotent debt-serfs that this systemic predation magically offers up the best possible outcome for the peasantry.
3. State benefits are used as bribes to buy the complicity and passivity of the wage-slave debt-serfs.
4. The New Nobility offer politically correct cover stories for their exploitation and predation.
Now that this strategy has failed to silence gilets jaunes, France's ruling class realizes the situation is serious. And as we all know, the ruling class everywhere follows this dictum: when it gets serious, you have to lie.
The lies are now continuous, hence the explosion of elite concern over fake news. The spark that lit the fuse of the current protests was a lie, of course; the fuel tax wasn't intended to "save the planet", it was intended to raise revenue so the elites could continue to extract their skim without endangering the economic order.
The elites' clever exploitation of politically correct cover stories has enthralled the comatose, uncritical Left, but not those who see their living standards in a free-fall.
France in a Nutshell: "The Government Stopped Listening to the People 20 Years Ago"
A family member who has lived in France for decades summarized the source of the gilets jaunes protests in one sentence: "The government stopped listening to the people 20 years ago. It would be difficult to deny the generalization of this: many if not most governments stopped listening to their people decades ago, preferring instead to listen to financial and political elites and entrenched cultural elites who view commoners with disdain.
Legions of commentators are weighing in on the economic and cultural sources of France's distemper. Many have characterized the protests as working class, broadly speaking, the multitudes who have seen an erosion in the purchasing power of their wages or pensions while France's financial, political and cultural elites have feasted on whatever meager gains the French economy has registered in the past 20 years.
The protesters rightly perceive that they are politically invisible: the ruling class, regardless of its ideological flavor, doesn't believe it needs the support of the I>politically invisible to rule as it sees fit. The ruling class has counted on the cultural elites to marginalize and suppress the politically invisible by dismissing any working-class dissent as racist, fascist, nationalistic and other words expressly intended to push dissent into the political wilderness.
The cultural elites reckoned their ceaseless depiction of working-class dissent as racist-fascist populism would continue marginalizing the commoners, but the worm has turned: the financially, politically and culturally marginalized classes are fed up.
Despite the usual squabbles between factions, the ruling class has long been united behind a simple tool of control: buy complicity with government benefits. Should dissent boil up in a broad-based movement, the solution is buy the protesters off with some new state subsidy or benefit.
This is one of the essential dynamics of Neofeudalism which are:
1. Debt penury and wage-slave loyalty to the New Nobility that owns the debt.
2. The financial-political nobility maximize their skim and justify this exploitation with airy assurances to the politically impotent debt-serfs that this systemic predation magically offers up the best possible outcome for the peasantry.
3. State benefits are used as bribes to buy the complicity and passivity of the wage-slave debt-serfs.
4. The New Nobility offer politically correct cover stories for their exploitation and predation.
Now that this strategy has failed to silence gilets jaunes, France's ruling class realizes the situation is serious. And as we all know, the ruling class everywhere follows this dictum: when it gets serious, you have to lie.
The lies are now continuous, hence the explosion of elite concern over fake news. The spark that lit the fuse of the current protests was a lie, of course; the fuel tax wasn't intended to "save the planet", it was intended to raise revenue so the elites could continue to extract their skim without endangering the economic order.
The elites' clever exploitation of politically correct cover stories has enthralled the comatose, uncritical Left, but not those who see their living standards in a free-fall.
Tuesday, December 11, 2018
SC178-15
https://libertyblitzkrieg.com/2018/12/11/can-the-yellow-vests-protests-go-global/
Can the ‘Yellow Vests’ Protests Go Global?
When it comes to the relationship of U.S. citizens to the politicians and bureaucrats in Washington D.C., there’s no indication that anything remotely resembling self-government is happening. Rather, the relationship is far more like that of a servant to a master.
From the October post: Americans are Stuck in Abusive Relationships with Power
The gilets jaunes, or “yellow vests” protests, emerged seemingly out of nowhere about a month ago and have in a few short weeks shaken the French political power structure to its core. Just yesterday, the exceedingly unpopular President Macron cried uncle and offered a series of concessions to the protesters. Many commentators have come to the simplistic and erroneous conclusion that violence works, but it wasn’t the burning cars or streets filled with tear gas that really scared Macron and the people around him. It was something much deeper than that.
First, powerful elites tend to be control freaks. Abuse of the law, institutionalized corruption and invasive surveillance typically make the powerful feel comfortable their position is secure. What really makes them shake is when something totally unexpected happens — and the virality and force of the gilets jaunes movement caught them off guard.
Second, the diverse, nebulous and leaderless nature of the participants and their grievances made it a difficult narrative to counter through the media or government spokespeople. It wasn’t masterminded by dissident political parties or even France’s activist unions. Though it was catalyzed by rising taxes on diesel fuel, it quickly became a rallying point for a hodgepodge of individuals with a variety of serious gripes against Macron and his neoliberal policies.
Third, and most important, the protests have been very popular amongst the wider French population, with polls in early December showing around 70% support. For Macron, a former Rothschild investment banker nicknamed “president of the rich,” that kind of broad support isn’t something easily ignored (though I’m sure he tried).
As the protests started to attract increased international attention, I began to wonder if they could spread spontaneously to other nations. As such, it was noteworthy to see reports of yellow vest-style protests in Belgium, and to a lesser extent The Netherlands, this past weekend. Then last evening I came across the following headline from the AP.
CAIRO (AP) — Egyptian authorities have quietly introduced restrictions on the sale of yellow reflective vests, fearing opponents might attempt to copy French protesters during next month’s anniversary of the 2011 popular uprising that toppled autocrat Hosni Mubarak, security officials and retailers said Monday.
They said industrial safety equipment dealers have been instructed not to sell yellow vests to walk-in buyers and to restrict business to wholesale sales to verified companies, but only after securing police permission. They were told offenders would be punished, the officials said without elaborating.
You know a government’s weak and paranoid when they’re afraid citizens might wear an article of brightly colored clothing into the streets, but the concern is warranted. Not just in Egypt, but across the world.
We humans are systematically manipulated into seeing ourselves as totally different and at odds with one another, but the truth of the matter is virtually all of us currently living on this beautiful planet share something very significant in common with one another. We all reside in countries run by and for the benefit of a tiny group of lawless and unscrupulous people. While some nations are clearly in far worse shape than others, we all live in very corrupt and increasingly unfree societies.
Because humans are easily divided and conquered, both within our own countries and on a global level, the few are able to easily rule over the many. If we can somehow find a way to resist power elite manipulations and unite to focus our attention on the true root of our problems, there’s nothing we can’t accomplish.
With Christmas coming and the weather in the northern hemisphere set to get colder, it’s certainly possible the gilets jaunes movement dies down a bit. If so, I have no doubt it’ll remerge even stronger down the road, because absolutely nothing systemic has been solved with Macron’s pitiful concessions.
More significantly, the French have provided the rest of the world with an important lesson. That protest movements should ideally tap into widespread grievances and capture the support of the masses in order to be most powerful and effective. This shouldn’t be hard for anyone, since I can’t think of any major governments anywhere in the world that aren’t completely captured by destructive special interests and unprincipled oligarchs....
Can the ‘Yellow Vests’ Protests Go Global?
When it comes to the relationship of U.S. citizens to the politicians and bureaucrats in Washington D.C., there’s no indication that anything remotely resembling self-government is happening. Rather, the relationship is far more like that of a servant to a master.
From the October post: Americans are Stuck in Abusive Relationships with Power
The gilets jaunes, or “yellow vests” protests, emerged seemingly out of nowhere about a month ago and have in a few short weeks shaken the French political power structure to its core. Just yesterday, the exceedingly unpopular President Macron cried uncle and offered a series of concessions to the protesters. Many commentators have come to the simplistic and erroneous conclusion that violence works, but it wasn’t the burning cars or streets filled with tear gas that really scared Macron and the people around him. It was something much deeper than that.
First, powerful elites tend to be control freaks. Abuse of the law, institutionalized corruption and invasive surveillance typically make the powerful feel comfortable their position is secure. What really makes them shake is when something totally unexpected happens — and the virality and force of the gilets jaunes movement caught them off guard.
Second, the diverse, nebulous and leaderless nature of the participants and their grievances made it a difficult narrative to counter through the media or government spokespeople. It wasn’t masterminded by dissident political parties or even France’s activist unions. Though it was catalyzed by rising taxes on diesel fuel, it quickly became a rallying point for a hodgepodge of individuals with a variety of serious gripes against Macron and his neoliberal policies.
Third, and most important, the protests have been very popular amongst the wider French population, with polls in early December showing around 70% support. For Macron, a former Rothschild investment banker nicknamed “president of the rich,” that kind of broad support isn’t something easily ignored (though I’m sure he tried).
As the protests started to attract increased international attention, I began to wonder if they could spread spontaneously to other nations. As such, it was noteworthy to see reports of yellow vest-style protests in Belgium, and to a lesser extent The Netherlands, this past weekend. Then last evening I came across the following headline from the AP.
CAIRO (AP) — Egyptian authorities have quietly introduced restrictions on the sale of yellow reflective vests, fearing opponents might attempt to copy French protesters during next month’s anniversary of the 2011 popular uprising that toppled autocrat Hosni Mubarak, security officials and retailers said Monday.
They said industrial safety equipment dealers have been instructed not to sell yellow vests to walk-in buyers and to restrict business to wholesale sales to verified companies, but only after securing police permission. They were told offenders would be punished, the officials said without elaborating.
You know a government’s weak and paranoid when they’re afraid citizens might wear an article of brightly colored clothing into the streets, but the concern is warranted. Not just in Egypt, but across the world.
We humans are systematically manipulated into seeing ourselves as totally different and at odds with one another, but the truth of the matter is virtually all of us currently living on this beautiful planet share something very significant in common with one another. We all reside in countries run by and for the benefit of a tiny group of lawless and unscrupulous people. While some nations are clearly in far worse shape than others, we all live in very corrupt and increasingly unfree societies.
Because humans are easily divided and conquered, both within our own countries and on a global level, the few are able to easily rule over the many. If we can somehow find a way to resist power elite manipulations and unite to focus our attention on the true root of our problems, there’s nothing we can’t accomplish.
With Christmas coming and the weather in the northern hemisphere set to get colder, it’s certainly possible the gilets jaunes movement dies down a bit. If so, I have no doubt it’ll remerge even stronger down the road, because absolutely nothing systemic has been solved with Macron’s pitiful concessions.
More significantly, the French have provided the rest of the world with an important lesson. That protest movements should ideally tap into widespread grievances and capture the support of the masses in order to be most powerful and effective. This shouldn’t be hard for anyone, since I can’t think of any major governments anywhere in the world that aren’t completely captured by destructive special interests and unprincipled oligarchs....
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