Affordability …


Industry and its necessary expansion is dependent upon a constant increase of available fossil fuel. Factories, houses, offices and stores burn fuel in their furnaces. Mechanized agriculture, which feeds most of us, requires fuel for its machinery as well as chemicals and fertilizers using- or derived from petroleum. Fuel- or fuel products are part of every aspect of daily life. Every form of industry from mining to packaging of finished goods is dependent upon liquid fuels as are automobiles, trains, trucks, aircraft and ocean-going goods-transport vessels. Our buildings are made from steel, composites, concrete, chemicals, all are goods made from- or with petroleum, natural gas or coal feedstocks. Our roads and our roofs are made of asphalt. Nuclear, solar, wind and hydropower are petroleum-fuel dependencies. Industrialization runs on fossil fuel energy, without fuel in continually increasing quantities there is no ‘economic growth’.

The ongoing failure of the world’s economies is the matter of insufficient increase in the amount of available fuel: this failure feeds back into various economic sub-systems, mainly those that generate and resolve credit.

Credit is a proxy for goods to be gained- or offered in the future. If there is less fuel in the future, credit is undermined as there is no point to it: goods or customers will be unavailable. We all live in- and make use of a physical, dimension-constrained world that ‘has or has not’. Managers can pretend otherwise but markets price reality: right now markets are pricing fuel scarcity.

 

Enter The Double Whammy.

 


 

Figure 1: The economic dilemma in one chart, by TFC Charts (click on for big): new fuel to replace the trillion barrels already wasted is increasingly costly. At the same time the economy cannot borrow enough to afford this more expensive fuel.

The economy needs to grow to meet high fuel prices, it cannot grow because of high fuel prices.

Analysts insist cost is unrelated to the ability to meet the cost: this is wishful thinking. The higher cost of credit effects the ability of buyers to bid for fuel because they must calculate the combined cost of fuel and the necessary credit.

High-priced fuel is no more productive than low-priced variety: $20 fuel buys same output of goods and services as does $120 fuel. The pricey fuel isn’t better, it simply costs more … as does the credit needed to meet the higher fuel cost. Firms are clobbered by the combined costs and so are their customers.

Managers seek to adjust by reducing administrative interest rates but the deflationary impact of high fuel prices represent another double whammy. Money itself is too cheap: represented by too-high prices for fuel. At the same time, money is too pricey: represented by the proxy relationship between fuel and money reinforced millions of times per day at gasoline stations around the world. Pricey money is fuel, some monies are more fuel-like than others. Money-fuel is hoarded, credit evaporates: the outcome is worldwide currency shortages, dollar preference and job shedding.

‘Inflationary’ paper promises are worth more than human labor because promises can be converted to fossil fuel labor. Little imagination is needed to see how this fossil fuel endgame plays out: extremely scarce currency, no credit, scarce fuel and little remunerative work. The machines will unfairly compete with humans … as long as there is some fossil fuel production somewhere, industrial jobs will shrink- then vanish.

Meanwhile, borrowing is becoming unaffordable: debt is expensive in nominal terms (in the euro-zone) and in real terms (in Japan). Debts are taken on to buy fuel and fuel wasting machines, more debts are taken on to buy the second rounds of fuel and machines and to retire the first rounds of loans. The process is repeated and loans pyramid. When the costs become breaking both lenders and borrowers fail. The outcome is diminished availability of credit, less ability to pay.

At some point this ability to pay falls below the level needed to bring new fuels to the users, there are shortages.

If all else remains the same, the ‘too-costly fuel period’ will occur within five years: it is not likely that all else will remain the same. A breakdown in finance such as banking collapse in the Eurozone will accelerate the process. Right now the cost to produce new petroleum at the well head or at the bitumen pit is very close to the low prices that the market is willing/able to offer. As credit vanishes and prices decline, these expensive-to-produce fuels are shut-in as unaffordable.

After high-cost fuel is off the market what remains is the dregs of the low-cost fuels. The price regime does not work backwards. If $60- or $50 per barrel oil is unavailable there is little- or no $40 or $30 oil to lift. The ‘easy oil’ has already been squandered, ditto with ‘easy’ natural gas, coal, gold and uranium (water). Many analysts believe that oil prices are ‘fixed’ to the current high level by speculators: that prices will decline to historic levels once speculators are cleared from the markets. This is incorrect, when expensive fuels become unaffordable what remains will be hoarded.

Credit diminishes as consumption becomes useless as collateral. Shortage of good collateral is a reason the economy cannot borrow enough now. The worth of fuel-waste enterprises diminishes with time. Not only does industrialization destroy its own supply of capital, it is necessary for industry to take on more debt in order for it to do so. What matters is not the location of capital destruction or the details of the process rather it is the fact of it.

– Petroleum fuel waste is uniformly automobile use which does not provide any economic return: driving the car does not pay for either the car or the fuel burned in it. The beneficiary of car use is the car maker and seller, the road builder, the house-builder/developer who creates the car habitat, and the fuel supplier. The car is simply the instrument by which these enterprises borrow their returns: this is at the expense of the rest of the economy and future generations who must retire the associated debts. Hundreds of trillions of obligations have been taken on already, meanwhile future generations are presumed to waste their ‘own’ fuels while taking their ‘own’ immense debts. How this is supposed to work out is never explained.

– Geology versus policy: fuel price increases reflect increasing difficulty to recover fuel rather than increase of ‘money’ which is the increase of (scarcely- serviceable) debt.

– Efficiency Relativism: system efficiency gains are overcome by demand growth: automobiles are easier to manufacture than oil deposits are to find then exploit.

Fuel prices are expected to increase as a market response to supply constraints and have done so since 1999. Those with insufficient credit are excluded from the market, fuel is rationed indirectly. Conventional analysis extrapolates increased credit in wholesale markets leading to galloping prices without limit: $200 – $500 per barrel of oil. This sort of price activity cannot take place:

– Price rationing either works or it doesn’t. Price rationing works when prices are seen to decline.

– Within market trends both the highest- and the lowest prices decline over time. Since 2008 the highest price has declined from $147 per barrel to $128. The highest price in the upcoming year is likely to be less than $120. This has little to do with fuel availability rather the ability of finance to produce credit and customers to afford it.

– The price that constrains consumption tends to be much lower than economists assume.

– As institutions/firms fail, credit diminishes.

– ‘Artificial failure’ as debtors refuse to borrow as to do so means certain ruin. This diminution of credit in retail markets cannot support high wholesale prices. Believe it or not, some already conserve energy voluntarily!

– Crude prices are caught in a contest between asset price in wholesale market versus the ‘street price’: what a refiner can earn by the sale of his products in excess of what he pays in the wholesale market. When demand declines the price to be paid also declines. Debtor bargaining power increases so that sector demand is moderated. Markets are not one-way: sellers are not price setters at all times or places. If buyers cannot pay or refuse to do so, the seller loses his money. The seller cannot do so continually without his own failure.

Prices periodically rise to unaffordable levels then decline. The high prices set during these intervals themselves diminish over time. These declines occur as the ability or willingness of fuel users to borrow diminishes. In real terms the cost of fuel increases relative to other costs, nominal prices decline.

At some point the real costs are too high to allow at-scale industrial use. Demand diminishes for petroleum because there are fewer industries to make use of it. Entire ‘waste-based’ economies fail. Industrial workers are cast into general unemployment, the industrial wealth of the world is extinguished by deleveraging: little remains of industry in the ‘modern’ sense for wealth to be a claim against.

This endgame is underway right now in parts of Europe. The process cannot be undone, outmaneuvered or negotiated with. Given time, the leaky bucket becomes the empty one: ‘Conservation by Other Means’ (to paraphrase Clausewitz).

Figure 1 above illustrates the industrial world’s cognitive dissonance. We pretend the world’s non-renewable resource base is inexhaustible when increased production cost is evidence to the contrary. We drain resources faster while insisting the exhaustion process has no ongoing effects, that waste has no consequences, that what sets the price of a good is independent of what enables the customer to meet that price.

Industry insists there are two separate economies that exist in parallel: one economy functions perfectly while the resources available to its twin are unavailable.

In this real world, when one economic factor is constrained the effects are felt everywhere albeit unequally. China becomes the beneficiary of Europe’s economic destruction: the Chinese consume what the Europeans cannot.

The Europeans cannot consume because their credit-worthiness is shifted to the Chinese. The same is true of the Americans. (from Stuart Staniford, Early Warning)

 

 

Figure 2: The increase in crude price has brought new supply to market: at what cost and for how long?

As the supply of credit diminishes, the financial support for development of new reserves will also falter. Diminishing credit effects the willingness of customers to bid and their ability to take deliveries. Credit has been the support for all industrial activities, nothing lasts forever.

Here is Michael Klare, Institute of Electrical and Electronics Engineers (IEEE):

 

… with production already declining sharply at most of the world’s major existing oil fields, more and more of the oil will come from harder-to-get-at sources—ultradeep-water deposits, Arctic reserves, the oil sands of Canada’s Alberta province, and the extraheavy crude of Venezuela’s Orinoco Belt. If exploited to the fullest potential, Venezuela’s reserves alone could satisfy world demand for another generation. But that oil will not be brought to the surface with the oil rigs we saw in the film There Will Be Blood (2007), notes Klare. The new technology will be more sophisticated, more resource demanding, more environmentally threatening, and of course, much more expensive.

 

None of this matters when we cannot afford it.

47 thoughts on “Affordability …

  1. dolph

    What is so jarring for me is the disconnect between fantasy, and the human imagination, and the reality on the ground.

    Even to this day, Hollywood and the video game industry churn out these sci-fi movies with flying cars and endless skyscrapers and endless amounts of “technology.” It’s BS! And besides, it’s now all fake, computer generated. The disconnect between the culture and the physical reality is too hard to ignore anymore.

    I still revisit some of the films from the 70s/80s. At least back then the “apocalyptic” pulse was still beating strongly. Those people had the courage to visualize true decline. And they didn’t have the computers to pretend otherwise. So they sort of understood what was going on, even though it was really early in the game.

    Now it’s late in the game, and the culture has completely morphed into fake optimism! It’s absurd, it’s tragic.

    1. The Dork of Cork

      Well its not quite Los Angeles November 2019…but………..

      http://www.youtube.com/watch?v=3KD7iMVe8Uk

      I am one of those guys who thinks the future would have been very different post 1965 – 1968~ if we did not have a rolling free banking crisis using goverment money as opposed to the 19th century practise of using private money produced in the Vault.
      But I concede the problems would be of a different nature and possibly on a larger scale now……
      We would essentially have made the planet glow a dull red on its dark side.

      Which is why some of the elite in the banking community shut these programmes down…. they were just too dangerous.
      http://www.youtube.com/watch?v=v4k_YZAXSEI

      Essentially Everything Post Cuba crisis was all about wasting the energy as quickly as possible so others could not use fossil fuels to build a larger more dangerous capital base.

  2. The Dork of Cork

    Some good rail news from Glasgow – the very first city to deindustrialize during this present era modern of entropy as London found richer wage arbitrage treasures elsewhere…….
    http://www.rail.co/2012/08/20/scotrail-adds-rush-hour-services-to-glasgow

    http://www.rail.co/2012/07/24/scotrail-expands-sunday-service

    I must say – I always liked looking out at those Greening Slag heaps from the 19th & 20th century when travelling on this route (there are now 4 rail lines again between these two cities.)
    http://www.panoramio.com/photo/14113230 (shotts route)

    http://www.panoramio.com/photo/36955877 (new /old route)
    en.wikipedia.org/wiki/Airdrie-Bathgate_Rail_Link

    The two main stations of Glasgow have a very different character
    With Glasgow Queen street taking almost all of the slightly more twee Edinburgh commuters (mainly from the Falkirk route) and also being the escape route for the famous and scenic West high land line)
    While Glasgow central is far more well Glasgow like……….
    http://www.youtube.com/watch?v=WEYMcxuFf9w

    The Scottish cities have a very different relationship when compared to Belfast and Dublin which is almost non existent.
    In both cases you have a administrative capital and a former Industrial centre who both don’t like each other much but the Scottish pair love each other deep down but the Irish cities marriage could not be saved as the husband and wife have no affection for one another which is understanable if you know the pair.

    Much has been lost……of course mainly to supermarkets…but much can be saved also……
    http://www.youtube.com/watch?v=kgOw9crjzMg

    While the much more impressive St Enoch street station was also a victim of the supermarket /car culture…..
    en.wikipedia.org/wiki/St_Enoch_railway_station

    Still the tiny circular 19th century Glasgow subway system remains after all these years
    http://www.youtube.com/watch?v=LabGqBzWBgA

    http://www.bbc.co.uk/news/uk-scotland-glasgow-west-17510931

  3. The Dork of Cork

    Looking at Scottish transport data …whats really striking is the decline of Bus passenger numbers despite the deserved reputation of Edinburgh Buses …….(don’t mention the Tram)
    In 1960 there was 1,664 million local passenger journeys on local bus routes…..
    In 2010 ? 438 million.

    This is as much a product of Glasgow’s deindustrialisation as the rise of the car in my opinion.
    Why ?
    People had no jobs and so much time…..so they walk or stumble…. to social functions rather then get a bus.
    http://www.youtube.com/watch?v=kuKZWkgo098

    Meanwhile the rail passenger numbers are slowly rising (although Scotrail now use a different methodology….)
    These are on average longer journeys.

    Rail passenger numbers originating in Scotland
    1960 : 64.9 million
    1964 : 73 million (1960s ,70s , 90s peak)
    1982 :49.5 million (trough)
    2007 :87.7 million (peak)
    2009 :85.2 million

    The latest passenger data from Scotrail is positive showing record numbers…
    http://www.scotrail.co.uk/content/scotrail-beats-passenger-record

    This data will not cover all passenger data in Scotland but most , also they do the Caledonian sleeper service from London to Fort William (west coast) & east coast etc etc which is Great….
    http://www.youtube.com/watch?v=0ZWHVRx-6xo

    Ferries (Cal Mac) are also a very important transport system in the west coast although less so since they built the Skye Bridge in 1995~
    1973 : 4.82 million
    1975 : 5.28 million (1970s peak)
    1982 : 4.19 million
    1995 : 6.86 million
    1996 : 5.59 million
    2006 : 6.02 million (noughties peak)
    2010 : 5.87 million

    You can still get to Skye by Ferry (2 ferries infact 1 very large from Malaig rail terminus and this very special old swing ferry)
    The sheepdog is the true pilot……
    http://www.youtube.com/watch?v=vhExFCksOoA

  4. The Dork of Cork

    Malliag is a good case study in depletion – the terminus to the west coast Highland line was a very large Herring and Cod town…..
    The fish catches collapsed so they switched over to prawn fishing to pay their accumulated debts ………the problem was the prawn nets killed all the juvenile fish so valuable fish like the Cod could never recover …..
    Now the Prawn fishing is tiny when compared to the past fishery and the town is little more then a Tourist spot with a few token fisherman.

    This local schoolgirl captures the tempo and feel of the town in the aftermath of these events.
    When the tourists are fished out – what happens then ?
    http://www.youtube.com/watch?v=u1OPrFfS_IU

    And a memorable scene from Local Hero filmed just a few miles from the town.
    http://www.youtube.com/watch?v=u14-eIaFoLg

    1. steve from virginia Post author

      Thank you JB. Eggen’s is an interesting paper. I’ve seen it before and there has been some commentary about it (Oil Drum, I believe).

      Of course I have problems with equating consumption with national power. It’s equating bankruptcy with national power. It’s all about the cars …

  5. Da55id

    We leased a 2012 Chevy Volt three weeks ago. We have put 550 miles on the car. In that time we have used 3/10ths of one gallon of gasoline. We used this gas in the first three days but in the last two weeks have used zero fuel as we’ve adapted to new possibilities. We pay 5.6 cents per kilowatt which yields $0.50 a gallon equivalent. We are achieving 47 miles per charge in the real world. At this rate, we will not need to go to a gas station for 3 years. The car has an automatic system to cycle the gas generator to keep it in good repair while we don’t use it. I believe it uses 3 tablespoons of gas to do its automaintenance cycling every couple of months. The car drives like a BMW. It’s truly fun. Gas? No thanks – I’ll pass 😉

    1. Sandor

      Electric cars merely push the costs out to other areas of the fossil fuel curve — nat gas, coal. The manufacture of the car of course is still petro-dependent. Depending on the profile of electricity generation in your area, it may be a matter of more coal, more nat gas, or nuclear. Unless you get your electricity solely from hydro or locally generated solar/wind, you are still burning fuel.

      At the margins, electric cars don’t really address the waste/burning ‘problem’. Of course, emissions are better, you save money, etc, it’s a good thing. But from a macro perspective, electric cars don’t ‘solve’ anything.

  6. steve from virginia Post author

    The system includes the car (and the car costs). The system is not simply the car.

    – Car and parts must be manufactured.

    – Fuel must be obtained and transported.

    – Fuel infrastructure (resources, wells, mines, power plants, pipelines, ports and grids) must be built, maintained and obtained (by violence if necessary).

    – Highways built and maintained.

    – Destinations built and maintained (none of these two factors are done rationally but for the benefit of the auto industry).

    – All the above require astounding debt subsidy (finance is required, now bankrupting itself).

    – Massive, overbearing centralized government must be in place to resolve bottlenecks in favor of the above industries (government unable to meet its own costs or private sector collapses).

    – Massive auto death toll and property damage must be resolved without disruptions (insurance and medical infrastructure is necessary consequence).

    – Destruction of useful landscape (mispriced to the benefit of developers): millions of arable hectares turned into useless sprawl and auto infrastructure for no real purpose.

    – Waste-cost of auto use is mispriced or (fraudulently) not priced at all. The waste-cost of auto transport looks to be complete destruction of Planet Earth.

    – Auto use makes its millions of operators fat, sick and angry (good for hospitals).

    – Auto use destroys communities from the ground up.

    What does that electric car cost to run, again?

  7. The Dork of Cork

    Classic deeply ironic Glasgow 1970s Subway propoganda film…. with the original Victorian 1890s trains sets……
    In the 80s Glasgow underwent a more dramatic Soviet like collapse as capital was exported to the 4 corners of the world.

    “we have got the biggest model railway in the world”

    I always think of the Brics collapse as the game changer – what little money remains will look to Glasgow for a return on their money.

    When it happens it will beyond the deeply ironic – it will be a form of high comedy – worth every penny.

    http://www.youtube.com/watch?v=WGeHgdMVujM

    A East coast Scot will no doubt make a classic novel from these strange events…as he will have the advantage of some distance and coldness.

    http://www.youtube.com/watch?v=iRPw6L-rI-0

  8. The Dork of Cork

    When you buy the Renault Twezzy you don’t really buy all the car…..you lease the very expensive Lithium Battery at 50 Euro ~ a month….
    Why ? ….the car would be uncompetitive if you had to sell the entire package.
    Also batteries work best in warmer climates etc etc.
    http://www.youtube.com/watch?v=R6dAZkwgkeA

    The Twezzy is basically designed for the French urban & suburban /village / town envoirment……where the local bakery , Grocery and train station is in the centre of town…..where electicity is cheap……..and the weather good for 9 months of the year……where parking is secure (no windows)

    It will be apparently also be used by the French postman just as the 2CV was used in the past but it will not have the same Volume or range.(I can only see it carrying one bag of mail)
    http://www.youtube.com/watch?v=hsDz9t5uNjE

    It will not replace the car……you will need major Bus & rail infrastructure positioned in the correct areas , and the population distributed in a concentrated pattern around these basic facilities.
    In short it will not work for America or the credit hyper inflated periphery of Europe.
    It will however perhaps be a useful addition in some limited optimum areas.

  9. The Dork of Cork

    This guy has pretty good videos about the Tizzy.
    I can see it working in the planned controlled envoirment of Flanders if you also plan ahead……and you MUST plan ahead – however he has the capital for multiple vehicles.
    He seems to use it to get to his workshop which is a large distance for a electric car of 30Km……
    http://www.youtube.com/watch?v=l23_pVkJufI

    Also the reality of driving it in the rain – Belgium is a wet and cold country in Winter.
    http://www.youtube.com/watch?v=Q1LnHuRpWuM

    He has very expensive taste – I believe he purchased this very expensive Swiss ecomobile second hand but it still must have cost him a few Bob……
    http://www.youtube.com/watch?v=djLZ4i4rq_o

    In terms of MPG nothing can really beat these very fast and aerodynamically effiecent but complex vehicles.

  10. The Dork of Cork

    Yes , the main disadvantage of this vehicle seems to be hauling the extra mass up hills – if you can get around that corner it could work for even semi -fit people.

    1. Ellen Anderson

      I have been working to perfect one of those for about 10 years. I live in a very hilly place. Recently some pretty good electric motors built into the rear bicycle tire (called hub motors) have been produced by BionX. The electric assist comes from lithium iron phosphate batteries (made in China, of course) that are expensive but at least they aren’t always running out of juice like SLA’s. I am not as enthusiastic as I used to be even though I love to ride my bike. They are really industrial products. They rely on the same supply chain and resource base as everything else. They take a very talented person to create and maintain them and bike shops can’t make enough money to make it worthwhile. I am so sad to say that I think they will remain a curiosity for most people.

      1. The Dork of Cork

        @Ellen
        Yes – if your life orbits a village and its hinterland the Twizy might work or a velomobile ….. I would think it would depend on the topography as much as anything.

        On Industrial subsidy…….
        Well we have 7 billion of us on the planet now – I think we have no choice really.
        I tend to think we need to continue with Mass electrical power and a ditching of petro based transport…. but thats just a Dorks view on things.
        Of course if we get a complete breakdown crisis all bets are off – of course the rural idyll will be just as dangerous if not more so then urban area as the population will disperse outwards to seek resourses.
        http://www.youtube.com/watch?v=wHf6Th-E3kE

  11. The Dork of Cork

    Recent Berlin Skyline test……. 10 cranes in this shot – not so long ago Dublin once had many more then this but……
    http://www.youtube.com/watch?v=gdZ_YUCl-2Q

    Making more Tram lines in Berlin….you could argue Berlin has public transport coming out of the wazoo and the capital needs to go into the hundreds of 100,000 -300,000 towns in Europe without tram lines but I guess they are preparing for something………
    http://www.youtube.com/watch?v=PyDfvMyAfJ8

    Almost empty tram ? -although it is August in Berlin when people who would generally use them for work are on Holidays….

    http://www.youtube.com/watch?v=WbW1BpaV_N8

  12. The Dork of Cork

    I must say I simply don’t understand Germany ……
    Its a much more decentralised place when compared to France….I think ? – which gives it both Advantages and Disadvantages I guess.
    But it seems to lack a strategic vision for anything.
    Everything is so fucking ANAL …..concentrating on the minute to the exclusion of the Grand vision.
    Look at this DB website on its stations
    http://www.bahnhof.de/
    Go to – Konjunkturprogramm 325 Mio. Euro für kleine und mittlere Bahnhöfe or in English
    then go to
    “Konjunkturprogramm TV”…..

    In it stations get the full insulation treatment – but the cost the cost the cost… of this for the return is very very small….look at the materials !!!
    Maybe climate plays a part in this but I feel its more then that.

    There is a sort of deep religious “Green” efficiency drive withen Germany without questioning where the energy will come from (its coming off our peripheral accounts) – and it won’t be solar panels on Berlin Apartments – even if they were located at a lower latitude the Grid simply can’t cope with this on a large scale

    Solar panals only work to heat water in Sunny areas and places that are off the Grid and thats it – hot water for the fucking dishes. – they should never never be used to feed a electrical grid…… with perhaps slight exceptions where you get a afternoon spike (air conditioning activity) in Central / Southern Spain etc…

    Dimitry Orlov was on the Max Keiser show today – and he said the one thing that surprised him was the almost complete lack of national effort schemes that might work to slow this train crash down.
    Its simply because the new post 1987 Market state goverments of Europe have no levers of power to pull –
    I guess he comes from Russia where everything has been even more centralised since Moscow came into existence – but some of that centralised stuff works !!!!

    If Germany wants to close down its Nuke plants to feel all warm inside (metaphorically speaking) then please please (FOR GOD SAKE) go back to the Deutschmark….. as they are externalising the costs of Nat Gas.

  13. The Dork of Cork

    This is more straightforward …….more or less…it has been delayed since the mid 80s
    reouverture-avignon-carpentras.fr/

    “We have a little used freight line between Sorgues (near Avignon) and Carpentras…. lets use it (closed to passengers 1938) – get the region involved blah blah blah blah……16KM of concrete sleepers etc etc.”
    Rail Link the large town of Carpentras to Avignon.

    http://www.panoramio.com/photo/12296002

    Just do it…..don’t concern yourself with thermal imaging of buildings that are naturally cold places anyway.

    If you have Nukes on board – your problem is liquid fuel shortages , you need not worry your sorry little ass with conserving coal.

  14. The Dork of Cork

    Meanwhile the Tours – Bordeaux LGV is ripping through some of the best French Agricultural land like a gigantic sandworm……

    http://www.youtube.com/watch?v=nOK8wPMfCco

    They are possibly building for inter city traffic volumes that may not exist in the future.
    Like all western countries – its capital base is in the desert sands rather then its domestic hinterland of agriculture which for the moment is secondary to its “wealth”

    The accountants look at these local projects as part of the social economy rather then the “real” economy as at the moment their input output ratio is very low when compared to the grand LGV projects which are sucking in most of the real (see energy) resourses.

    So the Tours Bordeaux will coat at least 7.8 billion Euros.
    And the Carpentras project 80 million ~…..which is also more Labour intensive thus much less cost effiecent under the anti- labour Euro regime.
    So they could rebuild 97.5 Carpentras like lines for the cost of one LGV…..
    And this links towns of not insubstantial size to Avignon.
    Carpentras pop : 29,271
    Monteux : 10,789
    Entraigues-sur-la-Sorgue : 7,581
    Althen-des-Paluds :2,520
    Nearly 50,000 people !!!!!

    And to think this is only 1 half of this old U shaped line…..the second half linking back onto the mainline via the town of Orange will not be built for some reason despite having more towns on this route.
    http://www.panoramio.com/photo/68427893

    So in France we have this Very Big Grand project stuff which goes back to the days of Vauban and before and this pointless saving of tiny amounts of BTU for huge capital inputs in Germany because it gives them a warm feeling inside.
    There is very little stuff that is in between these 2 extremes…..stuff that is on a human enough scale so as to become part of the immediate hinterland but big enough to make a difference to future lives.
    http://www.youtube.com/watch?v=cnBfnkWFLD8

  15. The Dork of Cork

    The remaining local rail line will not be built to Aubignan station which is between Aubignan town pop.4,861 & Loriol-du-Comtat village pop.2,234
    Sarrians pop. 5,757
    Jonquières pop 4,309

    The line would feed into the mainline via the substantial town of Orange pop.30,025
    http://www.panoramio.com/photo/40473621

    This illustrates the choices that the French elite are making – they wish to bail out their investments in Ireland , Spain etc rather then their more local areas via the use of these Grand projects -which will indeed project oil outwards so that we can waste the stuff and produce a interest return.

    PS….This area is apparently a hotbed for the local far right.

  16. The Dork of Cork

    National rail trends quarterly summary 2011 -12 Q4 was published by the (UK) ORR a few weeks ago….
    It continues to illustrate the much different monetary conditions withen the UK when compared to the Euro monetary disaster.
    http://www.rail-reg.gov.uk/server/show/nav.1527

    The passengers are up of course (reaching for 1500 million journeys a Year – a doubling of traffic since 1993-94) but the freight data is most interesting recovering almost to the 2007 -08 level
    The total amount of freight moved increased by 9.5% when compared to 2010/11 !!
    All commodities moved experienced a upturn except OIL which decreased 8.9 % relative to the 2010 -11 period ………

    Freight lifted (distance is not factored into this metric) is also up.
    101.7 million tonnes in 2011-12 … a increase of 13.1% over the period 2010-2011.

    Coal is a very big factor in this…
    As electricity suppliers switched over massively from gas to coal during this period.
    Coal lifted increased by 14.3% in one year to 44.4 million tonnes !
    Other freight increased by 12.2% in one year to reach 57.3 million tonnes.

    Meanwhile French rail freight seems to be suffering badly -July 27 2012
    “Overall passenger traffic rose 0.6% compared with the first half of 2011. Long distance division SNCF Voyages saw revenues climb 4.2% year-on year, although passenger numbers fell 1.1% on domestic TGV services, primarily due to the economic slowdown, poor weather, and additional public holidays which reduced demand for business travel. However, this was offset by a 3.7% increase in international traffic, which was boosted by new services to Germany and Switzerland via TGV Rhin-Rhône, the launch of new TGV services to Italy, and strong performance by Eurostar.

    Ridership on TER regional services rose 5.7% year-on-year, while Transilien Paris suburban services saw a 2.4% increase.

    Logistics subsidiary SNCF Geodis continued to struggle in the face of tough economic conditions, with overall railfreight revenues dropping 9.7%. French railfreight business Fret SNCF saw 10.1% shaved off its revenues compared with a year earlier.

    Group investment in the first half reached €1.16bn, of which 64% was for new rolling stock, and 36% for station upgrades, service centres, passenger information systems, maintenance equipment, and IT systems. Net profits for the first half reached €253m, while SNCF’s net debt stood at €9bn on June 30

    So French rail freight lines such as this are quieter then ? I don’t know – must fish out the data.
    http://www.youtube.com/watch?v=ert0DSz5u30 (go to 13.00 to see its freight terminus in the town of Thouars.
    There are efforts to revive a railcar on this line …closed since 1980 from Thouars to Niort…..
    fr.wikipedia.org/wiki/Gare_de_Thouars

    Without enough money tokens withen the French system it won’t get the passengers.
    Full buses can beat half empty railcars for fuel effieceny everytime…..

  17. Sandor

    Here’s what I see now as a financial market participant: Investors and money-changers want corporate ‘growth’ at all costs, which means a policy of strip-mining the earth and human labour. Peak efficiency for a capitalist is to make everyone a wage slave with no rights of assembly. Then replace the slaves with robots. The costs are ‘externalized’ in the form of mountainous public debt. Gradually, more and more people are pushed down into lower class socioeconomic status. It is an agenda of institutionalized violence and impoverishment.

    There is no desire to even discuss a ‘non-growth’ conservation agenda, or a global birth control policy. We are still running the 18th imperialist utilitarian playbook. The Imperialists’ party is intent on total dominion. Everyone must sing along or live in a circle of tents in the woods.

    It seems it will take at least another 12 years of crisis before social consciousness stops trying to rev the engine while the gears are in neutral. We must get off the ride, and the cultural transmission must be rebuilt. Right now, we are just burning gas faster, spinning the tires, pretending to ‘go somewhere’. Creativity, innovation, is lauded by the culture, yet when push comes to shove, only a few people have the courage to go out of bounds with intent and bring something back. Status quo defines the ‘good life’ for its people – bread and circuses with some lip service to god and country.

    On the plus side, there are a few nations such as Bhutan that have chosen another path, based on natural conservation and compassion for life. Humans are capable of other cultures, and so we must persist in doing what we can to encourage others to drop the old script and learn how to play new games.
    Bhutan tour by locals:
    http://www.youtube.com/watch?v=qQzuWm2POPA
    http://www.youtube.com/watch?v=2_psxD_2aH4

  18. The Dork of Cork

    A man warning of investment to fit perceived increases in capacity rather then efficiency investments – see high speed rail rather then convential rail.

    Great pissed off speech from last year.

    http://vimeo.com/30442057

    en.wikipedia.org/wiki/Robert_Ayres_(scientist)

  19. The Dork of Cork

    The ORR 2 August (UK) national rail trends quarterly for Q4 (Jan – March) is interesting…..

    Passenger numbers are up of course ( now double the numbers of 1993-4)

    But rail freight really stands out.
    Freight Moved (weight & distance of load) is up near its 2007 /8 highs again.
    Freight moved in 2011-12 is up 9.5% relative to 2010 -11
    All commodities moved experienced a increase between 2010-11 and 2011-12 except OIL…down 8.9%

    Also the dramatic shift over from gas to coal in the British electricity sector is reflected in the figures and is perhaps a decisive reversal of the wasteful “dash for gas” policey post 1990 which appeared to make the privatisation of the sector profitable until the resourse base was extracted out 20 years later….

    This is best seen in the freight lifted metrics (no account of distance in these numbers , just tonnes carried)
    101.7 million tonnes lifted in 2011-12 , a increase of 13.1% over 2010-11.
    Coal lifted 44.4 million tonnes , a increase of 14.3%
    Other freight lifted 57.3 tonnes , a increase of 12.2%.

    PS British rail freight lifted is a small part of the overall Fright lifted in the UK
    In 2010 for example only 4.4% or 86.3 million tonnes was lifted on rail.
    This contrasts with 82.7% lifted on road.

  20. The Dork of Cork

    Although I can’t get the tonnes moved and lifted from SNCF its recent rail freight financial results show major declines reflecting the catostrophic monetary conditions withen the Eurozone.
    Financial results first half of 2012 (july 26)

    “Logistics subsidiary SNCF Geodis continued to struggle in the face of tough economic conditions, with overall rail freight revenues dropping 9.7%. French rail freight business Fret SNCF saw 10.1% shaved off its revenues compared with a year earlier.”

    However the British private rail companies rolling stock continue to age while SNCF always invests a big amount into new vehicles
    “Group investment in the first half reached €1.16bn, of which 64% was for new rolling stock, and 36% for station upgrades, service centres, passenger information systems, maintenance equipment, and IT systems. Net profits for the first half reached €253m, while SNCF’s net debt stood at €9bn on June 30.”

    In total British private rail companies investment during the entire year of 2010 /11 was a very small £503 million, 70 % into rolling stock….even though this was a 33.5% increase over the 2009 /10 period !!!!!
    The average age for British rolling stock is now 17.73 years…….

    So French Freight railway lines such a this are probally much quieter now….
    http://www.youtube.com/watch?v=ert0DSz5u30 (see 13.00 minutes in when it pulls into Thouars pop. 10,500)
    Up until 1980 this railway also functioned as a mixed railcar / freight line – the best most optimum use for rural lines such as this.

    There is talk of them using this line again for railcars to link the bigger town of Niort to the south but its looks almost impossible withen the Euro structure without more fiscal subsidies.
    fr.wikipedia.org/wiki/Gare_de_Thouars

    I guess Thouars will continue to waste stuff on a massive scale like all Euro towns until it cannot.
    http://www.youtube.com/watch?v=dWGm7mJ9Si0

  21. The Dork of Cork

    One can’t help but think whats happening in Euroland is a artifical crisis on one level given the huge spare capacity in energy efficient transport infrastructure in France & Germany……. me thinks the CBs new what was coming down the tracks – I don’t think they are fools , their primary job is to facilitate the oligarchs via monetary warfare….

    For example is it a coincidence that private British rail companies are now profitable while public or quasi public rail companies in Euroland (to be more exact) are suffering ?
    Is the BoE easing so as to make these utilities appear profitable and has the ECB / EU Hydra destroyed these economies so as to facilitate the final handing over of the remaining bits of commons withen Continental Europe ?
    Of course their profitability has nothing got to do with wether they are private or not – its all about the monetary envoirment.
    Besides almost all rail capital outside of rolling stock comes from public coffers anyway – which means public money subsidises private companies directly withen the UK.
    Almost all of the commons is now private property in the UK while the remaining Euroland public companies that subsidize the commons must become private so as to be more competitive , whatever that means…..it EU Law.
    Now public companies abuse their position hugely but so do private companies working withen natural monopolies.
    I remember travelling to the old ski /spa town of Luchon on the early morning train some years ago (there is/was only the early morning train ,nothing else in Summer really)
    On maybe a 3/4 carriage setup I was the only passenger…..most people took the car I guess.
    http://www.youtube.com/watch?v=FWlOV6ExpJY

    You can only imagine how much money you could make on this in a UK type monetary envoirment ?….. the train would be most definitely full in mid summer and mid winter.
    Modern Luchon was a product of its rail station – it will be again.
    fr.wikipedia.org/wiki/Bagnères-de-Luchon
    http://www.panoramio.com/user/2419040/tags/Bagnères-de-Luchon

    Its not so much a question of build it and they will come but seize a asset ,and then only then ease the money…… and then they will come.
    The CBs friends want the old days back – including control of all the commons with no political discourse or discord that may make life uncomfortable for some.
    Then they will ease in Europe.
    Ahhh yes the old days……
    http://www.youtube.com/watch?v=OanX4cxodjM

    They are building a perfect little oligarchy in Europe – even more tight then the last.
    It seems – They have learned so much from the post Soviet experience – the locusts they had sent out to scour are now the only voice in a quiet dead room.

  22. Pingback: Affordability | Doomstead Diner

  23. The Dork of Cork

    Yes French rail transport figures show some slight recovery , particularly in Agricultural transport, with transport of transport equipment (cars ?) falling off a cliff in 2011 after a major increase / spike in 2010…
    million tonnes kms TOTAL
    Y2008 : 40,436
    Y2009 : 32,129
    Y2010 : 29,965
    Y2011 : 34,202
    Agricultural goods
    Y2008 : 3,805
    Y2009 : 4,048
    Y2010 : 3,353
    Y2011 : 4,512…… this is probally the shifting over of Grain transport from Trucks to rail again (La Rochelle etc) – after the those strange post 1987 Euro days where the rail freight business was slowly murdered to facilitate easier handling and thus less labour / wage saving….

    Transport equipment
    Y2008 : 319
    Y2009 : 207
    Y2010 :1,318 ?
    Y2011 : 87 WTF happened here – it looks as if a plant closed down that was using rail freight or perhaps there was a sudden major effort at rail distribution to save costs that did not work out.

    To give you a idea of the decline in rail transport in France ….in the year 2000 French rail traffic was 57,700 million tonnes Km…..
    The gradual deregulation of the Industry and EU laws preventing Fiscal subsidy that worked to offset the waste inherent withen “competitive” business dependent on more direct bank credit subsidy was gradually removed. – see the trucking Industry.

    EUROPE IS A DISASTER ZONE – post 1987 they removed the remaining small national control measures on the waste products of the credit industry.

    They also removed the fiscal subsidies on Irish rail freight – for example 400,000 tonnes of Keg Beer was carried on Irish rail up to Y2006….. now nothing.
    Beer is heavy but apparently it is not competitive to carry the stuff via rail in Europe – better to burn a huge amount of Diesel in trucks as it reduces Labour costs……

  24. The Dork of Cork

    A good example of what can be done on a regional level despite catostrophic monetary conditions if you have enthusiastic pro local rail leadership.
    fr.wikipedia.org/wiki/Alain_Rousset
    TER trains (the local services are showing big increases in 2011 passenger numbers * km)
    Go to “In 2011, an 8% increase in passenger traffic of TER and airports”
    http://www.insee.fr/fr/regions/aquitaine/collection.asp?id=42

    The Bordeaux -Agen route exceeded 100 million passenger KMs for the first time.

    Google translate
    “The “Flying Agen Heart” is available in 6 points to make downtown Agen its attractiveness and dynamism including:

    the creation of a real pedestrian area around the Boulevard de la République;
    the creation of 800 additional parking spaces with new rules for parking ;
    a new plan for transport which irrigate the city center with regular bus and shuttles;
    one plane traffic in downtown magazine that fits both the new pedestrian area and in terms of public transport;
    entertainment program and development of commerce city;
    a program of home renovation old.”

    http://www.agen.fr/1-39583-Renovation-Gare-Agen-Centre.php

    http://www.youtube.com/watch?v=52dJdA3IaGY

    http://www.panoramio.com/photo/9702086

    Still I think the money would be best spent rebuilding the old freight line between Agen & Auch rather then Bus & Parking stuff.
    en.wikipedia.org/wiki/Agen–Vic-en-Bigorre_railway
    http://www.youtube.com/watch?v=cinoH8AElYc

    http://www.panoramio.com/photo/9507891

  25. The Dork of Cork

    Its harder to get rail data from the regions other then places with a political rail focus such as Aquitaine but the Paris Basin Data is available.

    Covering Years 2010 & 2011 (number of trips , millions)

    RATP including: 3,048 / 3,102 (1.8 % increase)
    en.wikipedia.org/wiki/RATP_Group

    Metro 1,506 / 1,525 (1.2 % increase)
    RER 457 / 469 (2.6% increase) – RER is the local rail system covering the Hinterland around & outside Paris
    Paris Bus 339 / 352 (3.8 % increase)
    Suburban bus 637 / 641 (0.6% increase)
    Tramways (excluding T4) 101 / 107( 5.9% increase)
    Other services 8 / 8 (5.0% increase)
    SNCF * 687 / 706 (2.8% increase)
    Bus OPTILE TRA + (p) 320 / 331 (3.4 % increase)
    Together 4,055 4,139 2.1

    So we have fairly modest rises in passenger numbers given the rise in fuel costs in the optimum for public transport Paris basin….
    Clearly the famous Paris Metro does the Heavy lifting with the small tram system holding the most potential for growth

  26. Enicar333

    Affordability? We won’t even be able to afford the space or time to bury all the dead in what is to come.

    ” What if the generation that once rocked out to The Who’s “hope I die before I get old” line actually does?

    Most retirement plans and federal budget projections assume baby boomers — those Americans born between 1946 and 1964 — will live significantly longer than their parents have. That is a logical assumption, given healthcare improvements, new drugs and the long 20th century experience of ever-rising life expectancies.

    But there is a counter argument: boomers, beset by factors like elevated rates of obesity, cancer and suicide, could reverse or at least slow the increase in human life spans. A change in trend could have a bearing on everything from Social Security trust fund balances to the number of nursing homes and golf courses supported in the future.

    “It does not bode well for the baby boom generation at all,” says S. Jay Olshansky, a public health professor at the University of Illinois at Chicago who has been studying boomer longevity under a MacArthur Foundation grant.”

    Will baby boomers live as long as expected? http://www.msnbc.msn.com/id/48676939/ns/health-aging/#.UDqaT6BleG4

    It does not bode well at all, Boomers – because we intend to cut you off!

    “America should have known the Boomers were evil from the moment they made “never trust anyone over the age of 30” mantra. It’s always the liar who assumes everyone else is lying:

    It’s not just in the USA either. The “youth movement” was international, and so, unsurprisingly, is the cancer of Boomer-created debt. It’s fine to blame today’s young for taking on credit card and school loan debt, but let’s not forget that it is the Boomers who created the massive public debt as well as making it impossible for those who followed them to do what they did, and shed their school loan debt in bankruptcy.

    Fortunately, the time is rapidly approaching when the younger generations can band together and permit the Boomers to experience the consequences they deserve by shutting down their overly generous pensions and refusing to pay for their medical care. They’ll keep voting for anyone who promises to serve their self-centered interests, but that will become increasingly irrelevant as more states and localities simply don’t have the wherewithal to live up to their contractual obligations.”

    The Great Inter-generational Con: http://voxday.blogspot.com/2012/07/great-intergenerational-con.html

  27. The Dork of Cork

    Wonderful discussion about utopias amongest very old teenagers……back in 1993
    http://www.youtube.com/watch?v=tHP0IgD53A8

    “he turns to a illegal underground movement who believes Pigs can fly”

    My perfect world orbits perfect local train stations which is unfortunetly destroyed by murderous ,chaotic ,lurking Ian Banks created characters ……
    http://www.youtube.com/watch?v=c9xG-hB6ozI

    PS I just don’t get Ian M Banks – it just too complex for Dorks.
    Ian Banks is much more comprehensible.

    kimstanleyrobinson.info/

  28. The Dork of Cork

    Part 3s interveiws get to the meat of our present crisis – ….Sean Stewarts Passion play sounds interesting.
    http://www.youtube.com/watch?v=ECMgNVk5z2I

    “Its one version of the world as our standard of living decays”

    “People are digging in”
    “And I think passion play is a 20 or 30 years down the road DUG IN North America”

  29. The Dork of Cork

    The IEA is up to their statistical games in their latest oil report which will appear to boost OECD demand relative to non OECD on a superficial basis
    They have dumped their North American category (US,Canada & Mexico) which made some sense and created a Americas category adding Chiles 300KBD~

    OECD Europe now includes Estonia & Slovenia(80 KBD) from the FSU and non OECD Europe therefore subtracting from FSU etc.
    The OECD Pacfic category becomes Asia/Pacfic – essentially tacking on Isreal to the OECD Pacfic section.
    It will now be harder to look at the historical series for North America etc….
    Pathetic stuff really.
    They will however essentially have to ignore countries such as Italy withen this series as their oil demand moves towards second world status.
    I love the Italian Diesel moving oil average graph —it is not flattening out – it looks like a terminal dive to me.
    Maybe Marios efforts to transfer Diesel demand (work) to France & Germany has been too succesful ?
    omrpublic.iea.org/demand/it_dl_ov.pdf

  30. The Dork of Cork

    Diesel demand in..
    Germany :
    omrpublic.iea.org/demand/ge_dl_ov.pdf
    France :
    omrpublic.iea.org/demand/fr_dl_ov.pdf

    The UKs Diesel demand is also very robust.

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