The Peak Oil Crisis: The Future of Government

December 8, 2010 5:50 PM0 comments

In case you missed it, a couple of weeks back the International Energy Agency in Paris got around to disclosing that the all-time peak of global conventional oil production occurred back in 2006. Despite that fact that this declaration was tantamount to announcing the end of the 250-year-old industrial age, few in the mainstream media noted the event and it was left to obscure corners of cyber space to ponder the meaning of it all.

It is also worth noting that oil is back in the vicinity of $90 a barrel and even Wall Street economists, who are paid to be eternally optimistic, are starting to talk about oil going for$110-120 a barrel in the next year or so.

In the meantime, the talking heads, pundits and even hard-headed reporters chatter on about the slow but persistent economic recovery that is supposed to be taking place. As the effects of last year’s near-trillion dollar stimulus start to be felt, every statistical twitch upward is hailed as proof that normalcy will soon return. Realists, however, call this twitching “bottom-bouncing” and are convinced that far worse is yet to come.

As we all know by now, a new crowd has descended on Washington vowing to make everything right again by cutting taxes, reducing the size and the role of some parts of the government. Above all the folks are committed to getting government regulation off our backs so that free enterprise, the entrepreneurial spirit, merchant capitalism, or what have you can flourish as it did in the past.

What all those calling for reduced government fail to grasp, however, is that 200 years of cheap abundant fossil fuel energy has transformed this country into something completely different. Take food as an example, 200 years ago, some 90+ percent of us were involved in its raising or otherwise procuring food — or we would simply not eat. Now, thanks to cheap fossil fuels, less than 3 percent of us are engaged in agricultural endeavors and I suspect only a fraction of our “farmers” still have all the requisite skills to feed themselves and their families in the style to which they have become accustomed. Take away the diesel for the tractors and farming is going to become mighty different. Has anyone yoked an ox lately?

We are trapped in a very complex civilization that is rapidly losing the sources of energy and numerous other raw materials that built and maintained it.

In short, 200 years of abundant energy have allowed us to build an extremely complex civilization based on dozens of interrelated systems without which we can no longer live – at least not in the style to which we have become accustomed. Food production and distribution, water, sewage, solid waste removal, communications, healthcare, transportation, public safety, education — the list of systems vital-to-life and general wellbeing goes on and on.

Those who believe that ten years from now we will be able to get along with much reduced government have little appreciation of how modern civilization works or how bad things are going to get as fossil fuel energy fades from our lives. The notion is absurd that we are in the midst of a routine downturn in the business cycle which can be cured by Keynesian stimulus favored by the Democrats or tax cuts favored by the Republicans.

While no one can foretell the future in detail, every now and again a window opens that allows a general outline of coming events to emerge. For example, in the years leading up to the Second World War one did not have to be clairvoyant to appreciate that a great disaster was about to befall.

Although few recognize how precarious the situation is, we are trapped in a very complex civilization that is rapidly losing the sources of energy and numerous other raw materials that built and maintained it. In America today we have millions un- and under-employed and that is certain to grow into the tens of millions before the decade is out as our politicians horse-trade tax cuts for billionaires in return for extensions of unemployment benefits. The good news is that this phase of the great transition from the industrial age to that which will follow cannot last much longer for events are moving too fast.

Whether one likes it or not, the size and complexity of the coming transition will be so great and unprecedented and there will be so much at stake that only governments will have the authority and power to cope with the multitude of problems that are about to emerge. Be it heresy in some as yet unknowing circles; all this is going to require a massive transfer of resources from private hands to public ones. Take something as simple as jobs. If anyone thinks the employment situation is difficult, wait a few years until the very high priced motor fuels makes discretionary car travel unaffordable. Millions upon millions of jobs in the retail, travel, hospitality, recreational, and dozens of other industries will be lost.

The current efforts by various levels of government to stimulate job creation or save people from home foreclosures will prove to be ridiculously inadequate. A completely new paradigm of what we do to sustain life is going to have to emerge or things will become far worse than most of us have ever known. Modern civilization simply cannot stand a situation in which a substantial share of its people is destitute. The potential for social disorder is too great.

If current trends continue, somewhere in the next five years a critical mass of us will realize that new foundations for civilization, and new ways of life must be found and implemented if we are going to survive with a modicum of comfort, economic, and political stability. Until then there will be many false prophets calling for a return to a civilization which is no longer possible.

 


Tom Whipple is a retired government analyst and has been following the peak oil issue for several years.

 

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