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Olduvai III: Catacylsm
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Our rapid ascent in energy and resource use has distorted our view of “normal”

Our rapid ascent in energy and resource use has distorted our view of “normal”

The new reality warns we are on a collision course with Earth’s finite limits —

Tom Murphy

“The delirious ascent in energy and resource use witnessed over the past few centuries has been accomplished via the rapid, accelerating expenditure of a one-time inheritance of natural resources—a brief and singularly remarkable era in the long saga of human history. It has produced a dangerously distorted impression of what “normal” looks like on this planet. …Thus far, heeding physical boundaries has not been necessary for the most part, as the scale of human endeavors has only recently become significant in a planetary context. We are now entering into a new reality: one in which our ambitions are on a collision course with natural limits on a finite planet. It is a slow-motion trajectory that has been apparent to some for an embarrassingly long time*, but not yet acute enough to have grabbed the lasting attention of the majority. [*D H Meadows et al. The Limits to Growth: A Report for the Club of Rome’s Project on the Predicament of Mankind. Universe Books, 1974]” —Tom Murphy

Tom Murphy is an associate professor of physics at the University of California, San Diego. Murphy’s keen interest in energy topics began with his teaching a course on energy and the environment for non-science majors at UCSD. Following his natural instincts to educate, Murphy is eager to get people thinking about the quantitatively convincing case that our pursuit of an ever-bigger scale of life faces gigantic challenges and carries significant risks.

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Get Ready for a Wild “Base Effect”: Highlighted Forcefully when it Suits Them, as with Inflation; Silenced Forcefully When it’s Awkward, as with Corporate Earnings

Get Ready for a Wild “Base Effect”: Highlighted Forcefully when it Suits Them, as with Inflation; Silenced Forcefully When it’s Awkward, as with Corporate Earnings

We’re going to be awash in huge and even absurd percentage-growth numbers.

The numbers are starting to crop up everywhere: For example, new vehicle sales in March jumped nearly 60% from March a year ago. But last March was the beginning of the lockdowns. Compared to two years ago, March 2019, new vehicle sales were down 1.2%. In the first quarter, new vehicle sales were up 11% year-over-year, but were down 2.9% from Q1 2019.

Today, the New York Fed released its latest Weekly Economic Index (WEI), one of the high-frequency measures that came out of the crisis. The index is based on ten daily and weekly indicators of real economic activity, compared to the same time last year, and is scaled to line up with year-over-year GDP growth. Last year, it fairly accurately predicted GDP growth, I mean plunge.

In Q1 2020, GDP had dropped sharply, and in Q2 2020, it plunged. The year-over-year growth rate of the upcoming GDP report compares the dollar GDP in Q1 2021 to that of Q1 2020. Given the sharply lower dollar GDP in Q1 2020, and the plunge in Q2 2020, the year-over-year growth rates for Q1 and Q2 this year will be massive, even as GDP in dollars will likely remain below where it had been in Q4 2019. But these are the kinds of year-over-year percentage spikes we’re going to see, even as dollar figures have not reached back to 2019 levels:

Another example, to dip into absurdity: The TSA reports daily checkpoint screenings, a measure of how many people entered into airports. Airlines were essentially shutting down last April and the number of passengers collapsed by over 90%, to just a trickle. Compared to 2019, the current 7-day moving average of daily checkpoint screenings is still down 37%, but compared to a year ago, it spiked by 1,168%.

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Do You Believe in Magic?

The people pretending to run the world’s financial affairs do. The more layers of abstract game-playing they add to the existing armatures of unreality they’ve already constructed, the more certain it becomes that they will blow up all the support systems of a sunsetting hyper-tech economy that now has no safe lane to continue running in.

Virtually all the big nations are doing this now in desperation because they don’t understand that the hyper-tech economy is hostage to the deteriorating economics of energy, basically fossil fuels, and oil especially. The macro mega-system can’t grow anymore. We’re now in the de-growth phase of a dynamic that pulsates through history, as everything in the universe pulsates. We attempted to compensate for de-growth with debt, borrowing from the future.

But debt only works in the youthful growth phases of economic pulsation, when the prospect of being paid back is statistically favorable. Now in the elder de-growth phase, the prospect of paying back debts, or even servicing the interest, is statistically dismal. The amount of racked-up debt worldwide has entered the realm of the laughable. So, the roughly twenty-year experiment in Central Bank credit magic, as a replacement for true capital formation, has come to its grievous end.

Hence, America under the pretend leadership of Joe Biden ventures into the final act of this melodrama, which will end badly and probably pretty quickly. They are about to call in the financial four horsemen of apocalypse: 1) Modern Monetary Theory (MMT), 2) a command economy, 3) Universal Basic Income (UBI, “helicopter” money for the people), and 4) the “Build Back Better” infrastructure scheme.

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money, monetary theory, modern monetary theory, debt, money printing, james howard kunstler, clusterfuck nation, magic, degrowth, growth

Are We Staring At A Coming Systemic Breakdown & The End Of Capitalism?

For any problems they face, governments all over the world are now conditioned to simply deficit spend or issue new $trillions in ‘thin air’ currency.

So how in danger are we of that recklessness leading to a breakdown of the entire system?

Respected financial analyst Michael Every suspects we’re closer than most realize.

As governments continue to flood the world with debt-funded stimulus, they not only fan the flames under the social powderkeg of wealth inequality, but they are destroying their own powers in the process.

Up until the Great Financial Crisis, a dollar in new federal debt issued resulted in more than $1 in incremental GDP. But no longer:

Federal Debt Growth vs GDP Growth

That indicates the government is now at the ‘pushing on a string’ phase: it can’t grow out of its problems. Issuing new debt only digs the insolvency hole deeper at this point.

Which is why Michael agrees that now, more than ever, is the time to partner with a financial advisor who understands the nature of the risks and opportunities in play, can craft an appropriate portfolio strategy for you given your needs, and apply sound risk management protection where appropriate:

adam taggart, peak prosperity, michael every, rabobank, capitalism, money printing, credit expansion, central banks, monetary stimulus, growth, risk

Energy and Human Ambitions on a Finite Planet

Energy and Human Ambitions on a Finite Planet

Where is humanity going? How realistic is a future of fusion and space colonies? What constraints are imposed by physics, by resource availability, and by human psychology?  Are default expectations grounded in reality?

This textbook, written for a general-education audience, aims to address these questions without either the hype or the indifference typical of many books.  The message throughout is that humanity faces a broad sweep of foundational problems as we inevitably transition away from fossil fuels and confront planetary limits in a host of unprecedented ways—a shift whose scale and probable rapidity offers little historical guidance.

Salvaging a decent future requires keen awareness, quantitative assessment, deliberate preventive action, and—above all—recognition that prevailing assumptions about human identity and destiny have been cruelly misshapen by the profoundly unsustainable trajectory of the last 150 years.  The goal is to shake off unfounded and unexamined expectations, while elucidating the relevant physics and encouraging greater facility in quantitative reasoning.

After addressing limits to growth, population dynamics, uncooperative space environments, and the current fossil underpinnings of modern civilization, various sources of alternative energy are considered in detail— assessing how they stack up against each other, and which show the greatest potential.  Following this is an exploration of systemic human impediments to effective and timely responses, capped by guidelines for individual adaptations resulting in reduced energy and material demands on the planet’s groaning capacity. Appendices provide refreshers on math and chemistry, as well as supplementary material of potential interest relating to cosmology, electric transportation, and an evolutionary perspective on humanity’s place in nature.

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finite resources, finite planet, growth, thomas w. murphy jr.

What Interest Rate Triggers The Next Crisis?

What Interest Rate Triggers The Next Crisis?

  • The Ten-year U.S. Treasury note yields 1.61%.
  • 10-year high-quality corporate bonds yield 2.09%.
  • The rate on a 30-year mortgage is 3.05%.

Despite recent increases, interest rates are hovering near historic lows.  We do not use the word “historic” lightly. By “historic,” we refer to the lowest levels since the nation’s birth in 1776.

The graph below, courtesy of the Visual Capitalist, highlights our point.

interest, What Interest Rate Triggers The Next Crisis?

Despite 300-year lows in interest rates, investors are becoming anxious because they are rising. Recent history shows they should worry. A review of the past 40 years reveals sudden spikes in interest rates and financial problems go hand in hand.

The question for all investors is how big a spike before the proverbial hits the fan again?

Debt-Driven Economy

Over the past 40 years, debt has increasingly driven economic growth.

That statement on its own tells us nothing about the health of the economy. To better quantify the benefits or consequences of debt, we need to understand how it was used.

When debt is used productively, the interest and principal are covered with higher profits and sustained economic activity. Even better, income beyond the cost of the debt makes the nation more prosperous.

Conversely, unproductive debt may provide a one-time spark of economic activity, but it yields little to no residual income to service it going forward. Ultimately it creates an economic headwind as servicing the debt in the future replaces productive investment and or consumption.

The graph below shows the steadily rising ratio of total outstanding debt to GDP. If debt, in aggregate, were productive, the ratio would be declining regardless of the amount of debt.

interest, What Interest Rate Triggers The Next Crisis?

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On a finite planet, maintaining endless economic growth is not a viable option

On a finite planet, maintaining endless economic growth is not a viable option

Cooperative conservatism could help to get us off growth with minimum pain and maximum gain, says Richard Heinberg. —

Richard Heinberg

“Both the U.S. economy and the global economy have expanded dramatically in the past century, as have life expectancies and material progress. Economists raised in this period of plenty assume that growth is good, necessary even, and should continue forever and ever without end, amen. Growth delivers jobs, returns on investment and higher tax revenues. What’s not to like? We’ve gotten so accustomed to growth that governments, corporations and banks now depend on it. It’s no exaggeration to say that we’re collectively addicted to growth. The trouble is, a bigger economy uses more stuff than a smaller one, and we happen to live on a finite planet…. Engineering a happy conclusion to the growth binge of the past century might be challenging. But it’s not impossible. Granted, we’re talking about an unprecedented, coordinated economic shift that would require political will and courage. Perhaps we could think of it as cooperative conservatism (since its goal would be to conserve nature while maximizing mutual aid). It would require a lot of creative thinking on everyone’s part.” — Richard Heinberg, Post Carbon Institute

Richard Heinberg is an American journalist and educator who has written extensively on energy, economic, and ecological issues, including oil depletion. He presently serves as the senior fellow at the Post Carbon Institute.

Below is my repost of Richard’s latest contribution delivered with concise clarity and with my added subheadings, text highlighting, selected bulletted formatting, and images. Alternatively, to read his original piece on the Post Carbon Institute’s website, click on the following linked title.


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The pandemic as the end of consumerism. Everything that’s happening is happening because it had to happen

The pandemic as the end of consumerism. Everything that’s happening is happening because it had to happen

 These Medieval ladies look like fashion models. With their splendid dresses in silk brocade, they are displaying their wealth in an age, the 14th century, in which Europe was enjoying a period of economic growth and prosperity. They couldn’t have imagined that, one century later, Europe would plunge into the terrible age of witch hunts that would put women back to their place of child-making tools. It is the way history works, it never plans, it always reacts, sometimes ruthlessly. And all that happens had a reason to happen (above, miniature by Giovanni da Como, ca.1380)

Can you tell me of at least one case in history where a society perceived a serious threat looming in the future and took action on it on the basis of data and rational arguments? With the best of goodwill, I can’t. Societies react to threats using a primeval stimulus-reaction that may be aggressive or defensive, but that’s almost never rational.

Curiously, our society, that we call sometimes “The West,” was the first in history to have a chance to do something rational to avoid the destiny awaiting it much before the threat was clearly visible. It was in 1972 when the newly developed digital computers were coupled with a powerful analytical tool, “system dynamics.” The result was the study called “The Limits to Growth” that foresaw how the gradual depletion of natural resources coupled with increasing pollution (that today we call “climate change”) would cause the whole Western economic system to collapse at some moment during the first half of the 21st century. The study also suggested rational solutions to avoid collapse: reduce consumption, stop population growth, manage pollution, and the like.

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 “The Necessary Alternative to Growth is Degrowth”

A Review of Degrowth by Giorgos Kallis (2018)

In Europe, “degrowth” is actually a movement, while in the US it is barely mentionable in polite society. To question “growth” would be the death knell for any serious politician. So what’s going on here? We live in the same world and face the same reality of “limits-to-growth” – a very popular concept in the US 50 years ago.

Well, since Earth Day, 1970, there has been a lot of “water under the bridge”, to be sure, but more to the point “oil in the pipeline”, especially in petro-states like the US. We may not be as dependent on oil as the other two big petro-states – the Saudis and the Russians – but it still skews our politics and our culture far more than most people realize. But Europe is not so well endowed with fossil fuels. That’s exactly the point of reading the European scholar Giorgos Kallis on degrowth. He’s not sidelined for painting a more sober view of the 21st century:

“Either we find a way to stop those who are plundering the earth and share the limited planet that we have, or we will enter a New Dark Age of humanity… There will never be enough until we share what there is… Degrowth marks a ruthless critique of the dogma of economic growth”.

Note the utopian element, which Kallis readily acknowledges: It’s not just about long-term economic contraction – that we must learn to live within our planetary means. That will happen one way or another anyway. He calls us to do all we can to avoid both catastrophe and plutocracy – the brutal dog-eat-dog and win-lose scenarios. Think of his solution as “resilience” plus “sharing”. And forget about the fiction of “green growth”.

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Aggregate green growth is a mirage: we need to take a more scientific approach to societal wellbeing

Aggregate green growth is a mirage: we need to take a more scientific approach to societal wellbeing

In the spring of 2020, the new Irish government announced its desire to develop new measures of well-being and progress in Ireland. The idea was given some prominence in the Programme for Government, ‘Our Shared Future’.

This is exactly the kind of initiative that we in Feasta have been advocating for the past 20-odd years. It’s also in line with an encouraging international trend of governments seeking to reorientate their economies towards well-being, and fits in nicely with the thinking of the global Wellbeing Economy Alliance (of which Feasta is a member).

A recent publication by Fine Gael, ‘Measuring Wellbeing’, refers to this Irish government initiative and makes a case for expanding “the range of economic, social and policy indicators that we use in government”. It lays out a draft outline for developing a wide range of metrics for measuring well-being, along the lines of the OECD’s Wellbeing Framework, and implementing them into State budgeting decisions. There is much in there to agree with.

Unfortunately, however, there is a serious problem with one of the most basic assumptions that is made in the Fine Gael paper. Unless this problem is examined and properly addressed, all the improved measurements in the world won’t be able to improve societal well-being in Ireland.

The problem relates to GDP growth. GDP growth is considered by the paper’s author to be “a critical means to the end of progressing society”.

This is a highly problematic assumption.

The authors take care to point out many of the well-known shortcomings of GDP growth as a measure of progress. So the issue here is not whether or not GDP growth is an unreliable measure of progress; it looks as though we can (almost) all agree on that, these days.

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The Economic Superorganism: Excerpt

For the last 200 years, increasing global energy consumption has translated to increasing global GHG emissions. While this might not be the case in the future, how do we consider the conflict between our instincts to react to immediate circumstances (i.e., consume more energy now, grow the economy now) and the political will to choose a different path based upon a future goal (i.e., limit human-caused climate change)? As Daniel Dennett asks in Freedom Evolves:

Where does the oomph come from to overrule our own instincts? Tradition would say it comes from some psychic force called willpower, but this just names the phenomenon and postpones explanation. How is “willpower” implemented in our brains?64—Daniel Dennett (2003)

Psychologists and economists use the term discount rate to describe how people make decisions, within our brains, when there are multiple options that present benefits at different points in time. Do I want one dollar now or two dollars ten years from now? Largely driven by natural selection and perhaps some idea similar to the maximum power principle, humans tend to have “steep” discount rates indicating that we tend to select rewards that come sooner rather than later.

Dennett uses the story of Ulysses and the Sirens in Homer’s The Odyssey to demonstrate the link between willpower and the idea of the discount rate. The goddess Circe warns Ulysses that during his journey home, he will sail past the Island of the Sirens. The Sirens appear to have exquisite beauty and a sweet song that lures sailors to their shores. But on approach, the sailboats crash on the rocks, and the sailors remain on the island, unwilling to leave as they listen to the song of the Sirens until they wither and die.

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Pausing the game of growth

I feel personally guilty for the pandemic. At the beginning of March, I published my PhD dissertation “The Political Economy of Degrowth”, whose introduction ended with the following words: “Let me invite you into a wild thought experiment. Imagine that in one year, it will all stop. In precisely 365 days, the economy will come to a halt. Imagine the economy gone and all of us frozen in social time, suspended between the past and the future. A societal time is up.”

I may have been wrong about forecast (not a surprise, I was trained as an economist), but my thought experiment has never felt as real as in the three months I spent under total lockdown in France. In the first quarter of 2020, French GDP decreased by 5.8%. This is the steepest fall since the beginning of national accounting back in 1949, almost four times as large as the one experienced during the first quarter of 2009 in the midst of the financial crisis. During the lockdown, 12 million private sector workers were put in technical unemployment, almost half of the working population. This is big. Economy-wise, it was the equivalent of turning off the light.

Left at home (unemployed), I found myself reflecting on this exceptional event and what it means for the future. This is what I came up with: the economy is a bit like a game. There are players, rules, objectives, and, ultimately, winners and losers. In today’s economy (let’s call it capitalism for short), points are counted in money and the goal of the game is to gather as many of them as possible.

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A life on our planet – review

A life on our planet – review

I watched David Attenborough’s film A life on our planet the other evening. The first, and largest, part of the movie was very well made. Perhaps not much new, but very well presented and with excellent footage and narrative. Some images are very strong, even brutal, such as a lonely orangutan sitting on a tree trunk in a devastated landscape. I think most viewers got the message: this has to change! And let me underline that this is a film worth watching.

Because the film is so compelling and Attenborough such a sympathetic person, viewers may accept all of its statements and arguments. This would, however, be a mistake in my opinion.

I totally agree with Attenborough that human population needs to stabilize. And it is true that, as far as we know today, birth rates falls when countries get richer (or vice versa). The problem is that lower population growth in one country is associated with increasing total resource use rather than the opposite. At least in the short term and with current consumption patterns, there is no relief for nature from lower population growth.What I missed in the first part was a lack of analysis of the underlying drivers causing the threatening sixth mass extinction. This is also reflected in shortcomings of the much shorter and optimistic second part of the film. The processes and technologies he claims will save the wilderness and human civilization are renewable energy, intensive farming methods, diet transformation, rewilding and reduced population growth.

His claim that renewable energy will make energy everywhere more affordable (than now) is wishful thinking with no evidence in reality.

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Analysis shows how the Greens have changed the language of economic debate in New Zealand

When Health Minister Chris Hipkins recently quipped that the Green Party is “to some extent the conscience of the Labour Party” he was not simply referring to polls suggesting Labour may need the Greens’ support to form a government.

Hipkins was also suggesting Green policies help keep Labour honest on environmental and social issues. So, what difference has the Green Party really made to New Zealand’s political debate?

Drawing on a study of 57 million words spoken in parliament between 2003 and 2016, our analysis shows the presence of a Green party has changed the political conversation on economics and environment.

In the recent Newshub leaders’ debate, both Jacinda Ardern and Judith Collins agreed that “growing the economy” was the best way to respond to the economic crisis driven by COVID-19.

Their responses varied only on traditional left-right lines. Ardern argued that raising incomes and investing in training would grow the economy. Collins suggested economic growth should be advanced by increasing consumer spending through temporary tax cuts.

By contrast, Green parties in New Zealand and elsewhere have long questioned the impact of relentless growth on the natural resources of a finite planet. Green thinking is informed by ecological economics, which aims to achieve more sustainable forms of collective prosperity that meet social needs within the planet’s limits.

man and woman shaking hands
‘Labour’s conscience’: Jacinda Ardern and James Shaw sign the confidence and supply agreement that brought the Greens into coalition in 2017. GettyImages

The language of economic growth

The impact of this radically different view can be observed in New Zealand parliamentary debates. When MPs from National and Labour used the word “economy” they commonly talked about it in the context of “growth” (“grow”/“growing”/“growth”).

On average, National MPs said “growth” once every four mentions of “economy”. Labour MPs said “growth” once every six mentions.

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Economy vs. environment: York Region seeking a process to develop Greenbelt lands


Economy vs. environment: York Region seeking a process to develop Greenbelt lands

Newmarket mayor says public should be consulted after environmentalists sound alarm

York Region councillors voted Thursday to ask the province to open up parts of the Greenbelt to developers — but a vocal few are saying the public should have been consulted first.

At a committee of the whole meeting Oct. 8, regional councillors and mayors debated a resolution asking the province to “unlock” protected land along the 400-series highways to allow for employment growth.

In the days before the scheduled vote, environmental activists sounded the alarm, blasting the region for “attacking the Greenbelt.”

Environmental Defence Executive Director Tim Gray warned that caving to pressure from developers and land speculators would set a dangerous precedent.

The region has been asking to develop the 400-series land for years and asked staff to prepare a report examining benefits.

Iain Lovatt, mayor of Whitchurch-Stouffville, led the charge, calling the activists’ accusations “utterly false and offensive.”

All municipalities “support, cherish and celebrate” the protected lands, but it’s been a polarizing issue and it’s time to address it head-on, he said.

“I believe there’s a fine balance that needs to be found between local municipal financial viability and managing the burden on local taxpayers while maintaining the importance and improving the Greenbelt.”

It’s an especially important issue for Whitchurch Stouffville, with 95 per cent of land protected under the Oak Ridges Moraine and most employment land in the south of the region, he said.

His town is targeting three areas along the 404 — at Stouffville Road, Aurora Road and Davis Drive — for employment, he said.

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Olduvai IV: Courage
In progress...

Olduvai II: Exodus
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