Titanicaca …

Next goes Europe, itself. The Greek default closes the book on Europe in its current form, which is a lost cause. It is the end of the beginning: there is not going to be any ‘recovery’ or way back from the abyss that is now engulfing the continent. Some fragments here and there might save themselves for a little while, then like sparks from a bonfire be swept away by the wind. The crisis must now burn itself out: Europeans, look to yourselves and may your turkey-God have mercy on your souls. (From ‘God, Peak Oil and Turkeys’)


What is interesting about this time of year besides having to deal with the tax man (“Render unto Caesar that which is Caesar’s) is the opportunity to gorge on Titanic-mania. With the famous sinking taken place 100 years to-the-day yesterday, the Titanic-mania is set to overload. Titanic and hockey playoffs are almost enough to compel a trip to the local ‘Best Buy’ for a 53-incher. Add pizza and life in the gibbering madhouse called the U. S. of A. becomes entertaining!

Watch that ocean liner filled with arrogant, rich morons hitting an iceberg over and over again, what’s there not to like?

Reformers could manage the same thing today: load a giant cruise ship with ‘entrepreneurs’, bankers, auto company executives; innovators, politicians and hedge fund managers and send it out with Captain Jack Sparrow looking for an ice field. Sorry, five life boats. If no ice is to be found after a day or two (climate change) the Navy can fire a missile into the ship and the Iranians can be blamed. Any ‘complications’ and the lawyers would be loaded onto a giant cruise ship … etc.

Fixing what’s wrong with America is remarkably easy, if you put your mind to it.

There are many reasons why the Titanic is the perfect metaphor for our times: the enterprise was (and is) gigantic, hubristic and overdone. The managers were (and are) greedy and stupid, the end had (has) the quest for the ultimate in luxury and decadence blowing up in everyone’s faces.

Here are some Titanic factoids:

– The Titanic was one of three more-or-less identical sister ships built by the Belfast shipyard Harland and Wolff for the White Star Line’s transatlantic trade starting in 1909.

– The White Star Line was owned by banker J.P. Morgan within a trust called ‘International Mercantile Marine Company’ which also owned a number of other international passenger shipping companies. This made the Titanic an American-owned ship. Morgan was booked to travel on his new toy but took ill and remained in England chickened out at the last minute.

– Surprisingly, neither Morgan nor the shipyard nor White Star Lines’ manager J. Bruce Ismay, or the line itself were brought to account for the disaster: Morgan and others for negligence, the yard nor its suppliers for defective or sub-standard materials. It is hard to see such a disaster taking place today without legal complications and billions in lawsuits.

White Star manager Ismay was pilloried in the Hearst press for not going down with his ship, he was publicly scorned as a coward for the rest of his life. Today, the managers and owners of sinking ships are expected to be in the first lifeboats after having hurled all the women and children over the side first (which is where that term ‘women and children first’ originates).

– The Titanic was the second of the three ships: the Olympic was first, the Titanic second, the third was to be named ‘Gigantic’ but the name changed after the sinking of Titanic to Britannic. The Olympic had a long 25 year-career as a transatlantic liner, the Britannic was sunk during World War One and was never in paying passenger service.



Unknown photographer, Shipbuilder Magazine, 1911, ‘Grand staircase on RMS Titanic’. Note the clock at the center of the landing: even in the middle of the ocean among the super-rich there is no escape from the tyranny of the clock.

– The Titanic was altered during construction to be slightly larger than the Olympic. There were other cosmetic changes made between the ships but all were designed to be floating luxury hotels with elaborate public spaces within the ship. The Britannic was not fitted out when World War One began, after a short layup it was converted to a floating hospital. Consequently, many of its first-class amenities were not installed.

– The three ships were developed to compete for the transatlantic trade with Cunard’s Lusitania and Mauritania as well as the Hamburg-America Line’s SS Deutschland and North German Lloyd’s SS Kaiser Wilhelm der Grosse. The largest part of the trade was the ferrying of European immigrants to the United States. At the same time, ships were the only means of travel between continents and competition for the first-class customers was intense.

– The three ships were not designed to be the fastest ships but rather the most comfortable, even for third-class passengers, who had access to good food and hot-and-cold running water, for instance. It was supposed that the first time many of the third-class passengers saw a toilet was on board the Titanic.

– The officers on board the ship during her maiden voyage were veterans of ocean liner crossings. The captain, Edward John Smith, was a mariner for his entire 38 year career, 25 years as master on White Star passenger ships. As Commodore or senior captain, Smith had earned the right to command new White Star ships on their maiden voyages. Captain Smith was something of an ocean liner klutz: he was involved with several close calls with collisions including a near-miss with another iceberg in 1902. During the port-out of Southampton on the way to Cherbourg the prop-wash of the rapidly-moving Titanic pulled another, smaller ship, the SS New York, from her moorings almost causing a collision in the port which would have ended the voyage. Tugs were able to pull the New York away from the Titanic at the last minute.

– The Titanic was a technological marvel of her age, a self-contained floating city: considered to be unsinkable due to her sixteen watertight compartments, telegraph wireless communications, internal telephone system, hot and cold water throughout the ship, electric heating and lighting for the passengers all on a ship as large as an eighty-story skyscraper laid on-end, one that could move across the ocean at 28 miles per hour.

– The ship was at the bleeding edge of what shipyards of the time could produce. Titanic’s hull was assembled out of hundreds of one inch thick steel plates sized approximately 6 feet by 20 feet. These plates were overlapped and riveted together and onto the ship’s frames. The hull areas in the center of the ship where the boilers and engines were located were given triple-rows of steel rivets, the ends of the hull were given double rows of cheaper iron rivets. Both the steel and iron rivets were found later to be defective, of low-quality material. Likewise, the steel plates were determined to become brittle when chilled. It is likely that both rivets and the plating cracked during the collision. The ship was divided into watertight compartments with the bulkheads given automatic doors that could be operated from controls on the bridge. What the Titanic lacked was high-volume pumps that could keep up with flooding within the compartments. There was certainly steam power available to drive large pumps that could have kept the ship afloat longer and under less strain even if she could not have been saved.

– The German and Cunard ships were faster but the White Star giants were more efficient: Titanic’s power plant required 650 tons of hand-shoveled coal be fed into its boilers every day, 350 tons less than its older counterparts.

– There were reports of a smoldering coal bunker fire aboard Titanic’s number six hold that the stokers were hoping to put to use in the boilers which might have been a reason for the ship’s high rate of speed through the ice field.

Everyone knows what happened on the evening of April 14th, 1912: the ship hit the iceberg in the North Atlantic a glancing blow, the first six watertight compartments were breached and the ship slowly sank taking the lives of over 1,500 passengers and crew.

Fast-forward to the present and there is the ‘Titanicaca’ which has all of the hubristic characteristics of the previous version with none of the grace and style. It’s made of cardboard and duct tape wadded together with false promises. It looks great on the outside but the inside is an unimaginable mess. It’s too large to control properly underway, it does not have pumps needed to manage liquidity. Like the first version, the passenger list includes feckless elites who cannot be bothered, unscrupulous ‘fixers’ and racketeers with the third-class sections filled with always credulous ‘television believers’.

As was the case with the original Titanic, the current version has struck a submerged object and the first five watertight compartments are flooded. The analysts have rushed below to inspect the damage and make assessments; the ship is doomed, sinking is assured it is only a matter of time. How much time? It could be tomorrow or next year but likely sooner (Bloomberg):


BRENT CRUDE FUTR (USD/bbl.) 118.500 -2.710 -2.24% 15:13
GAS OIL FUT (ICE) (USD/MT) 991.500 -15.000 -1.49% 15:12
HEATING OIL FUTR (USd/gal.) 312.020 -5.440 -1.71% 15:13
NATURAL GAS FUTR (USD/MMBtu) 2.015 0.034 1.72% 15:11
GASOLINE RBOB FUT (USd/gal.) 326.710 -7.900 -2.36% 15:13
WTI CRUDE FUTURE (USD/bbl.) 102.990 0.160 0.16% 15:13

Watch those oil prices dive, last week the Brent price was over $125 per barrel. There are no more Saudi Arabias to offer crude, only demand that has bellied-up and sunk.

Up on the bridge of the Titanicaca, the EU, ECB and IMF managers have completely lost their grip on reality. The multiple captains have ordered staff to go below and steal all of the passengers’ property that isn’t bolted down. Someone asks where the staff is going to put the property on the ship where will be safe? The captain standing in the corner does not answer but stares off into the distance muttering ‘Ice … I hate ice …” The officer returns: stealing turns out to be impossible because all of the property is underwater. Next, the officers order seamen to scurry below and cut off the flooded compartments labeled P.I.I.G. and S. with hacksaws. The idea is the ship without a bow will reach its ‘destination’ much faster than it would, otherwise.

Meanwhile, the ECB officer is bailing out the various compartments with a bucket running from one to the other and back frantically. The water hurled from the bucket flows right back into the Titanicaca. Of course there aren’t enough lifeboats: the various upper classes of passengers are taking what they can carry and battling their way into the boats. One is named ‘Swiss franc’; another is named ‘yen’ and another, ‘Singapore dollar’; others are, ‘US dollar’, ‘Treasury securities and equities’, some are named ‘gold’ and ‘silver’. Not everyone is going to make it: those missing the boats are putting on life-jackets made out of lead weights: ‘real estate’ and ‘EU sovereign debt’.


William Banzai 7 ‘Too Big to Fail’


Meanwhile, the third class passengers are locked up in the hold. The captain has ordered then to suck the water out the ship, the tools assigned to them are soda straws stamped ‘Made in China’. The straws must be bought and paid for before use but the Chinese are willing to extend credit if good collateral is offered.

What to do?

Are the lower class passengers ready to mutiny and put the officers off the ship or do they desire to take the first-class passengers’ place, so as to better rearrange the deck chairs? Since they are the only ones able to fix the ship’s problems it is really up to them to decide what to do. If they behave as the first class has done the ship will sink. If they attempt to make things right the ship might sink but they also might succeed. If they do nothing there is certain failure. Here is a dilemma that the passengers are ill-equipped to cope with. The passengers must not only act outside their narrow personal interests but also against how class interests as these are ordinarily defined as gains excluded from others. It is also outside decades of ‘television training’ which demands that individuals serve the system in order to be rewarded for their efforts at some unspecified point in the future (never).


When an ocean liner starts taking on water, what governs whether it’s “women and children first” or “every man for himself”? According to a report in the Proceedings of the National Academy of Sciences lead author Benno Torgler, men’s altruistic versus self-serving behavior depends on how quickly the ship sinks.


How quickly the ship sinks, indeed …

18 thoughts on “Titanicaca …

  1. enicar333

    “The NMI Retirement Fund, through its administrator Richard A. Villagomez, filed for Chapter 11 bankruptcy yesterday afternoon.

    The Fund also filed yesterday several motions, including a request for entry of order providing for the continued payment of benefits to government retirees, their survivors, and some persons with disabilities.

    The lawyer said the Fund’s payment of benefits to beneficiaries and operating expenses have averaged approximately $77.9 million per year in the last three years.

    In contrast, he said, during those same years, the Fund’s funding-consisting of employee contributions, returns on investments, and employer contributions-has averaged approximately $30.9 million per year.

    “As a result of such continuous underfunding, which necessitated withdrawing from its portfolio to cover funding shortfalls, the value of the [Fund’s] assets has fallen from $353,475,412 in 2009 to its current level of $268,448,997.84,” Huesman said.

    The Fund, he added, is subject to liabilities (both current and actuarial) totaling about $911 million.”


    “SAIPAN, CNMI (Saipan Tribune, April 17, 2012) – Non-retired members of the Northern Marianas Islands (NMI) Retirement Fund are a step closer to getting their money back, albeit only up to 50 percent-and not 100 percent as originally intended-of their defined benefit (DB) plan contributions without penalty under a “compromise” version of the controversial House Bill 17-226 that the Senate passed last night by a vote of 6-2.

    The conference committee stated that the enactment of the bill “will lessen the government’s financial liabilities as it authorizes qualified government employees to withdraw their contributions from the Retirement Fund, thus decreasing the government’s financial obligations to the pension fund.”

    “The potential adverse effect of this measure, however, is that it lessens the NMI Retirement Fund’s lifespan, which will create an immediate financial obligation of the Commonwealth government retirees’ pensions,” the report said.”


    The Northern Marianas Government Retirement Fund filed for bankruptcy protection under federal law in hopes of buying time to avert running out of cash by July 2014 or sooner.

    The financial future of about 2,400 retirees, some of them living on Guam, as well as 2,800 actively employed Northern Marianas government employees, is at stake.

    The Chapter 11 bankruptcy petition was filed yesterday in the U.S. District Court in Saipan.

    The Retirement Fund, through its administrator, Richard S. Villagomez, emphasized in the bankruptcy court filing that the Fund is not walking away from its obligations to Fund members.

    What the Fund would like to do, under federal bankruptcy rules allowing it to reorganize under Chapter 11 of the U.S. Bankruptcy Code, is get court approval to reduce the amount of benefits retirees would receive by 58 percent of what they currently get.”


    Lifeboat ethics will rule the post-peak World. Get PREPARED. Are you IN, or OUT?

  2. enicar333

    A lesson in debtonomy and stripping assets …

    NEW YORK (CNNMoney) — The maker of Twinkies and Wonder Bread heads to court Tuesday to try to throw out its union contracts, in a battle that leaves the iconic baker’s future very much in doubt.

    Hostess Brands, which makes Ding Dongs and a variety of other sweet treats, is asking the bankruptcy court in White Plains, N.Y. to tear up labor agreements, which would, among other things, allow Hostess to change how it funds union pensions. The hearing is expected to last two days.

    The company filed for bankruptcy in January, it’s second trip to bankruptcy court since 2004. And management has said that the investors who are financing the company during bankruptcy would pull out if there is a strike.

    Hostess was founded as Interstate Bakeries in 1930, although some of its best-known products go back much farther than that. Wonder Bread is 90 years old and Drake’s cakes have been produced since 1888. The company was renamed Hostess Brands as it emerged from bankruptcy in 2009.

    At the time of its January bankruptcy filing, Hostess said it pays about $63.2 million to its employees per pay period and owes more than $1 billion to more than 50,000 creditors. The bakers’ union pension fund was the biggest creditor, owed $994 million, according to the filing.

    Hostess said it is offering an attractive package to unions, including a traditional defined benefit pension plan and the same health insurance plan that’s offered to management, with 85% of the premiums paid by the company. It’s also proposing a pay freeze for workers, rather pay cuts.

    The Teamsters charge management is pushing for the confrontation and possible shutdown because its secured creditors are calling the shots, and see liquidation as a better chance of recovering their money. But the union says it’s willing to give Hostess the cost savings it says it needs.

    “We put an offer on table with $150 million in concessions,” said Ken Hall, the Teamsters’ secretary-treasurer. “There is not a chance our members would accept [the company’s offer]. They won’t work for nothing.”

    The union said it wants to see more sacrifices by management.

    “If there is no shared sacrifice and no equality of sacrifice, then there’s no deal,” said Teamsters General President Jimmy Hoffa in a call with memberships last week.

    Hall charges that Hostess is simply trying to get out of $1.9 billion in pension obligations, and that 91% of Hostess Teamsters have voted in favor of a strike, even though the union has made it clear that liquidation is a likely outcome of a strike. He said a strike date won’t be set until after a court decision.

    “We want to at least put into that judge’s mind … that perhaps throwing out the contract is not going to save the company,” he told members at Hostess in a conference call last week.

    Hall said Hostess’ labor costs are $400 per driver per week less than rival Bimbo Bakeries, which makes Arnold’s bread as well as Entenmann’s baked goods and Thomas’ English Muffins.”


    The good times are over, the cheap energy is gone. My beloved Twinkees will be gone forever. How did the pension fund ever get $994M in arrears – and how could it EVER have been repaid? WHO has the pension money – and who will go to jail – will it even be recognized as a crime?

    Shared Sacrifice is not in the lexicon of America, it’s now LOOT and SCOOT. The list at Daily Job Cuts gets longer and longer as more and more are thrown overboard – so The TOP can survive.

    MEANWHILE, The Citizens of Racine celebrate the legacy of MLK and show the future: “7:21 p.m. Multiple squads are responding to 911 calls for a fight involving at least 150 people at the King Center located on MLK Drive. Callers state that people are threatening to shoot up the place.”

    1. enicar333

      The Hostess Brands reorganization has cooked up a batch of bad news.

      Workers in a New Jersey Teamsters local are being forced to accept severe cuts to their pensions because the bankrupt baker has not made pension fund contributions since August, The Post has learned.

      By not making pension contributions since last summer, Hostess has put some of the multi-employer pension plans on life-support. By federal law the plan covering the New Jersey workers is now forced to cut benefits, a source said.

      Several days ago, Teamsters officials mailed packages to members of the local whose territory covers most of New Jersey, giving workers with 25 years on the job a choice between three unappetizing options:

      * Retire now and take a 40 percent pension haircut, or $1,675 a month instead of $2,700

      * Stay on the job until they are 57, one year past the current retirement age and take a near 50 percent pension cut, or

      * Work until 65 years of age and receive no haircut.

      “We lose no matter what,” a member of the New Jersey local told The Post.

      Hostess seems willing to budge from its position that the pensions must be eliminated, a source close to the situation said.

      Hostess is close to offering a new pension plan that might include some type of 401(k) matching, the source said.

      The new reality will be a return to the old reality of retirement : DEATH.

      In the future, good health is priceless. All others will be dead.

  3. The Dork of Cork

    The offical Irish debate is getting sureal……. they want to tax water in Ireland…. a exceptionally dry island ? , they are prepared to spend a considerable amount of resourses putting meters in each home.
    Somebody up top has a sense of humour anyhow.
    When you state the number of private cars has balloned from 800,000~ in Y1990 to 1.8 million private cars today and that is where much of the resourse wastage is you gat dead air….
    As you say we are merely conduits – they wish to push many of us into dire poverty so that at least some section of society can afford to waste the remaining surplus.

    I have looked at our import & export data again & again and I fail to see any water in the data set….but perhaps I am mistaken.
    If we save 50 % of our water ration how will that effect the balance of payments ?
    Me thinks we will just have some very stinky toilets.

    1. steve from virginia Post author

      It’s hard to say but could be a kickback scheme.

      Composting toilets are the way to go.

      they wish to push many of us into dire poverty so that at least some section of society can afford to waste the remaining surplus.

      That works until it doesn’t: the critical mass of private demand vanishes and the ability to waste vanishes along with it. The ‘some section’ does not understand this. Without millions of customers with modest means, the great industries have no markets and these collapse.

      A way to offset higher water costs is to collect rainwater and use it for non-potable needs such as watering plants and washing.

      High real costs for fuel, water and other resources is the ultimate way to force conservation. It’s cruel: it’s also the reason for there to be voluntary conservation because the effects can be modulated. If conservation is event-driven then everyone is simply left out in the cold at once without tools.

      1. cg

        I like the continuing byplay between you and jb, Steve. Enjoyed your latest comment at Interfluidity as well.

      2. jb

        CG: thanks – here’s the link to Steve’s comment on Interfluidity:


        I thoroughly enjoy reading Steve’s posts on other sites. However, I am disappointed that he doesn’t get rebuttals or further queries when he does so. I’m left wondering if it’s because the other readers don’t buy into the whole ‘peak oil / our economy can’t afford itself’ dilemma. From what I can tell, he never posts a link to his own blog; modest perhaps, but it would be terrific to have the inquisitive stop in here for a visit.


      3. steve from virginia Post author

        Most of the sites I comment on, clicking the user-name shoots you right over here.

        I’m not sure why peeps don’t comment. I can usually get a conversation going @ The Oil Drum …


        Not all sites have comment sections that are ‘user friendly’ Google doesn’t support threaded comments like this site does. If someone replies it might be twenty or thirty comments down.

        I’m glad you liked the Steve Waldman remarks because there is more coming …

        Ellen: the soil testing is vitally important. Most of the ‘urban soils’ are either diminished w/ zero nutrients or contain toxic chemicals. In modern developments the soil is scraped away w/ bulldozers and what’s left is crap. Nothing will grow in it but weeds.

      4. Ellen Anderson

        Extremely well stated response. The mindless cruelty of this approach to conservation is horrific. Working to build resilience at the local level is the only chance to equip at least some people with the tools they will need to cope. We are doing a town-wide soils testing program this weekend hoping to get lots of people to put their samples in a big box to go off to the labs. The ability of our soils to support some sort of agriculture is so important.

        The Archdruid has an especially good blog up today, I think. It helps to understand the larger forces at work.

  4. The Dork of Cork

    I think water scarcity is very different from fuel scarcity……at least in Ireland.
    If I use 10 times as much water as my neighbour because lets say I have the trots it really does not cost the utility much as the water itself unlike oil is inexpensive , However the fixed costs of production are well fixed at the water treatment plant.
    It does not rain crude.
    If the romans could provide water to cities with Slave BTus then we can provide water…… putting meters on water in Ireland is a very sick joke.

    Famously in early Victorian Glasgow they brought clean water down from the loughs as drinking from the Clyde was killing workers by the thousand.
    I regard clean free water as part of the commons as people who try to conserve such a almost free resourse (in Ireland & scotland at least) will impose externalities on the rest of us…….. think of toilets filled to the brim with……..
    Disease is then socialised.

    PS came across a very interesting car documentary.
    I have always liked 2cvs for their minimalism and design aesthetic.


    The mid evolution of the design.

    Form follows function or function follows form ?


    The entire documentry is a very interesting journey down European( pre & post war) resourse thinking.

  5. enicar333

    How the might have fallen… Racine is like the Titanic in so many ways – even her most favored Son has fallen…
    Profligate Son: A Billionaire Scion’s Sex Crime Allegations Rock A Company Town

    “Drive into Racine, Wis. from the north and the first thing you notice are the cheap strip malls and dilapidated houses. Between fast-food joints, Cigarette City sells discounted Marlboros. Almost every storefront on State Street is boarded up. Kids on push bikes hustle passersby for coins outside a Walgreens.”

Comments are closed.