Hope … Change …

President Obama easily won re-election yesterday: Where do we go from here?

– look for ‘Brand X’ opponent Romney to retreat into what Edward Gibbon called, ‘a well-deserved obscurity’. Smarmy Romney lacks the kooky charisma and media horsepower of a Sarah Palin or Paul Ryan, his TV days are done. He has nothing to say and says it with less conviction than just about anyone in public life. There is little left for Mr. Romney to do but to go back to Wall Street where he can reassure his own customers he is not stealing their money … while he steals their money.

The Tea Party has unraveled as a political phenomenon. The ultra-libertarian/Austrian/liquidationist faction within GOP politic has discredited itself: the public won’t buy social Darwinism no matter how much religion and patriotic moralizing are spackled over it.

– The GOP has no one to blame for the election outcome but themselves. Their primary election process — dominated by petroleum industry stooges and ‘missionary evangelists’ — prevented the Republicans from fielding a candidate able to challenge the vulnerable Obama. Who could have beaten him? An ordinary human being … that is, a non-radical Republican automatically excluded from the candidacy … by the extremist-filtering primary process and funding structure.

– From the ‘Welcome to the ironic universe’ department: this is the end of Ron Paul and his son, while there is no end in sight for Ben Bernanke. Gone: Palin, Santorum, Allen (in Virginia), Akin, Mourdock, Perry, Mack. Lost in influence: Bachmann, Ryan, Cantor, Gingrich.

– Libertarian economics do not appeal to Americans who do not want to be thrown to the ‘free-market’ wolves any more than they already have been. Americans want a level playing field with big business. Disappointment with Obama is that he is unwilling to hold powerful interests accountable, not that they are held too accountable. The intrusive, overbearing government fails to do its job or it does so in ways that protect private interests at the expense of the public.

– A big winner of the election is Occupy movement. They won by not embarrassing themselves and by helping out in New York City with the hurricane relief … where the reactionaries were notably absent. The crumbling Tea Party has left a political vacuum … if the Occupy group has the wit to seize the moment.

– The clock is ticking on the tycoons. They couldn’t buy this election and won’t get a better chance in any conceivable future. The shift is underway … from tycoons being admired and emulated to being loathed. The step after is for tycoons to be hunted down like rats. Credit the timely hurricane Sandy and a rising public awareness of tycoon-driven climate change.

– If I wuz a tycoon I would make like French and get the hell out of Dodge …

– Having fixed his footnote in history at the cost of a billion-plus US dollars look for the president to retreat with some dispatch from the public stage. ‘Hope and Change’ have morphed into hopelessness on one hand and an establishment death-grip on the status quo with the other. The establishment has few choices that allow it to remain the establishment! Conventional economics have run aground. The austerity camp and the stimulus factions both insist their policies will propel the USA waste-monetizing economic machine forward. None of the factions acknowledge that the operation of the machine itself … is what undermines it. The present devours the future faster and faster: the cost of each fill-up becomes more crushing as the machine annihilates with constantly greater scope and efficiency what it needs to run. The only returns are ‘money’ for the despised tycoons while the rest must be satisfied with the thin gruel of ‘We’re Number One’ and other inconsequential generalities. Meanwhile, the life support on our space ship is fed into the furnace.

– Obama is clever enough to know there is nothing conventional policies can do to remedy our current situation: he has access to the ‘input’ of at least a dozen intelligence services. At the same time, he never has to pay for a round of golf for the rest of his life. He can loiter with tycoons which clearly pleases him, he can start writing the obligatory post-presidential memoirs, he can secure places in corporate boardrooms/in places of tycoon exile. When the time comes in 1,515 days he can become a petit-tycoon himself. The office of Lincoln and Roosevelt has devolved into a running-board or ramp to commercial success. Obama is now a ‘Brand’: one day after the election the president has one foot out-the-door, he is a lame duck.

– Obama the Ironic: no doubt airports across the country will be renamed for the president just as the airline industry collapses due to fuel shortages … that are denied by Obama.

– Obama the Ironic part two: sometime within the next four-plus years the president is going to have to tell the American public the truth about energy supplies: we’ve run out and cannot afford to burn any more for endeavors that don’t pay for themselves — which means fuel for agriculture and some basic services and nothing else! Here is something to live for … and watch on live TV.

Goofiness is not confined to America, the Europeans have similar problems facing reality:


Worst of the Eurozone Crisis Is Not Over Yet

Megan Greene (Economonitor)

Greece released its 2013 budget last week, indicating that public debt will surge to 189 per cent of GDP by the end of next year. If Greece’s debt burden cannot be deemed to be on a sustainable path, the IMF cannot release more money.

The only way to reduce Greece’s debt burden effectively and sufficiently is to write down some of its debt. So far, Germany, the ECB and the IMF have all indicated they would refuse to take a hit on their Greek government bond holdings.

… even if Germany wants to give Greece more time and money to achieve a swingeing fiscal adjustment, Greece might not have any interest in doing so, particularly not after five years of economic recession.

A model student

In contrast to Greece, Ireland has been identified by creditor countries as a shining example of how Europe will emerge from the crisis.

It is true that Ireland has stood apart from the other bailout countries in a few important ways. For starters, Ireland has dipped a toe back in the bond markets, despite being in a bailout programme. Investors also seem relatively confident that Ireland will not default, as exhibited by lower, long-term Irish bond yields than its Greek, Portuguese, Spanish and Italian counterparts.

According to the Purchasing Manager’s Index (PMI), Ireland has seen its manufacturing activity expand over the past eight months. This is in sharp contrast with the eurozone, which has, on average, seen manufacturing activity contract for 15 consecutive months.

Ireland’s PMI data is encouraging, with new foreign orders particularly buoyant in recent months. This is a positive indicator for Ireland’s export sector, which should keep expanding.

But here’s the big problem in Ireland: there is no economic growth.


It’s hard not to come away from articles like this perplexed. What are the Irish or the Greeks supposed to do over the longer term … like 1000 years or so? How about 100 years? How about 10 years? Where is the ‘reality plan’?

There is the usual ‘growth’ mantra but what is supposed to grow? More auto sales? More vacation ‘villas’ around more miles of Mediterranean coast? More McDonald’s and Tescos? Right now the European auto industry is collapsing. Real estate is a bust. Retail margins are narrowing or gone. The European fuel consumption is almost 15 million barrels per day … most of this is imported from Africa and the Middle East. It is paid for with massive and unaffordable borrowing. The waste-based machine has been backfiring since 2008, the complete breakdown is heaving into view.

From whom are the Europeans borrowing? Ireland and the rest cannot borrow against their own accounts — they are shackled to the euro — they must borrow from financiers in City of London and Wall Street. Currently, credit terms are onerous … what comes next? If Europe cannot pay its bills its fuel consumption is exportable to the United States which can borrow against its own account at all levels. There is a reason why the US president is claiming the country is ‘energy independent’.

How is Ireland supposed to cope with the current state of affairs for more than a few months? Ireland has no domestic fuel production to speak of. It MUST borrow or go onto a severe — and permanent — energy diet. Can Ireland borrow for another year? It must, obviously. How deep a the hole will creditors allow Ireland to dig? How can the country repay- or service its debts when it cannot borrow more fuel? The Irish corporate tax shelter is not very useful to corporations that aren’t earning much. Eire can be the gateway for flight capital to exit Europe but that lasts only until the euro is done away with. At that point Ireland descends toward failed-state status like Serbia … or Yemen.



Figure 1: Irish oil consumption plummets because Ireland cannot afford to borrow. As it wastes more it falls further into debt. Even if the Irish gain new credit today, they certainly cannot do so forever.

This is the debt-energy trap that has enmeshed all the world’s modern nations. The idea is that something magical will turn up in the next decade or so and ‘solve all the problems’ in the meantime, the entire European Enterprise hinges on whether the ECB can keep offering rear-guard actions: making loans … that are more dubious every month! At some point, organic returns are needed … these never arrive. Sadly, there are no returns on consumption … simple waste for its own sake. The West has nothing in the way of real goods or services to offer in exchange for the petroleum it burns up … except for petroleum burning gadgets! Here is the most vicious of all vicious circles.

One outcome of this dynamic is fuel poverty … something that occurring right now across the euro-zone and in the UK. What the Europeans need to do pronto is to rethink the ‘business as usual’ concept and ditch growth. Cheap natural resource capital does not exist any more. What remains is worth too much to waste. The economy built around monetizing waste is a loser. Europe needs to power down and figure out how to provide decent lives for citizens without consumption. Unfortunately, there is little time remaining to figure out how to do this. The ongoing Euro-calm is an eye in the hurricane, the next phase will see Europe cut off from fuel supplies and structural shortages that cannot be dealt with.

Conservation by other means …

65 thoughts on “Hope … Change …

  1. Sandor

    New Hampshire’s motto is ‘Live Free or Die.’ Even they opted for a warm blanket and hospice nurse in their old age over ‘Liberty’, which has always meant in the American vernacular the freedom to appropriate, by the point of a gun, pen, or drone strike, the necessary resources to contrive ‘growth’ and ‘profits’. Social security comes to mean the ‘right’ to burn fuel to stay warm, comfy and medicated after 70.

    The status quo has several more acts to play out before the apostasy of the growth cult defers to a conservation ethos. ‘No’ is a hard sell until the heating oil and natural gas trucks stop delivering. This will be a decades-long ride.

    Let the global margin calls commence

  2. The Dork of Cork.

    I think Ireland has been given more slack because it is a neo – liberal model market state with now few state assets to sell other then maybe its railway system which has a now unusual vertical integration that can be stripped and a few tiny dams and a little peat that is burned in the midlands.
    I think our Gas power system is a write off – although it may be useful for operation during mealtimes for a few hours and then shut off again.
    There is a gas find coming on line soon (the corrib field) but it peaks the moment it is switched on.

    The last thing we have got is our farms but without subsidies they just break even under the present system (the farmers gave up the co- op system because of both Greed & pressure from globalization)

    In contrast Greece was more of a old school nation state with a few more bits and pieces to sell.
    Merkel recent noises of Greece having a state that is too large proves that bitch is a agent for the neo – liberal entropy set.

    I think when we leave the Euro we should go the post war Norway route and ban the importation of private cars unless you are a GP or something and perhaps only import certain models such as the skoda fabia greenline.
    We have many second hand cars to share.

    Some people somewhere in Ireland bought 16 Porsches in 2012 (3 in 2011)
    Is that a good use of capital for a nation in a emergency ?


    How many Porsche cars were imported during the second world war I wonder ? (if they could somehow get past the Royal navy )

      1. The Dork of Cork.

        Well I think Mercs make fantastic second hand cars (much better then BMers which are far too sporty)
        Those Rabat taxi drivers cannot all be wrong.
        But look at the new diesel sales :1,784
        petrol sales ; 44 !!

        You are witnessing a stratification in Irish society between those who have large deposits as a result of the credit hyperinflation and those that have very little.
        Some of those large deposits are buying expensive diesel cars that could last 20 years or more.

        As for getting drunk ,singing and generally making a tit of yourself – well speaking as a bit of a piss head myself looking back at it now the pub trade began to decline when the Euro was brought in.
        Pub labour became more expensive.
        Monetary power can change entire cultures all on its own…it just takes a bit of time.
        It was disguised somewhat by the vulgar credit hyperinflation years but you just knew something was wrong.
        I got kicked out of a few pubs in Kerry for telling the poor bastards they were living in a fools monetary paradise but they simply did not want to know about it at the time.

      2. The Dork of Cork.

        Interesting article from Orlov – he caught the mood of the place I think.
        He is correct the irish economic gurus are plonkers first class – the Irish economy blog propoganda website should tell you all that needs to be known.
        Kilkenny is such a bore.
        Next year they should travel to a more interesting Irish town……………

        They will have some stories to tell I imagine – if they somehow survive the intense intellectual atmosphere of the place.

  3. The Dork of Cork.

    You may not be aware of this Steve


    I am not expert on this project – but we will pay the full market price for this while remaining no sov………
    We will more then likely go back to a link with Sterling rather then engage with a free floating currency…..(as we have no balls)
    My guess something like a 50 % punt / sterling peg.
    This smaller field will therefore satisfy the much reduced demand for energy during its first few years especially within our very wasteful elec. power sector as isolated sub rural non farm houses are abandoned.

  4. The Dork of Cork.

    I think the SEAI is a terrible organisation with a neo- liberal outlook and no understanding or willingness to understand the power of effective state dirigisme but they do publish useful energy balance data.


    fig 5 and fig 10 energy flow charts give you a feel for the energy balance – in particular fig 10 which shows our dependence on Nat gas for much of the base load (although a coastal coal plant investment created and planned after the shock of the 1970s oil thingies and completed just as the neo liberal thingy started to really get going in 1987 is a life saver for us)

    Whatever happens (unless China implodes ? ) we are going back to 1990 or mid 1980s energy density levels with a extra million people on board this ship)

    See figure 6 & 7 TFC

    And the larger ratio of coal in figure 14 (fuel mix for electricity generation) but with a much smaller energy footprint again.

    This cannot be achieved without a free floating punt or a devaluation / peg against Sterling unless they want that Greek thingy on the streets.

    1. steve from virginia Post author

      The Irish will stick with the euro until the end b/c they DON’T want to link in any way with sterling. A smart European country right now would dollarize. It would do two things:

      – allow the country under discussion to leave the euro without really spitting on it,

      – it would give the country under discussion access to dollar credit. The ongoing euro credit embargo would not apply b/c a dollar credit embargo is ludicrous. Even the Iranians can get dollars while Greeks et. al. as members of the euro-zone cannot get euros.

      1. The Dork of Cork.

        Its a strange club the eurozone.

        I would hire a Tug to drag us north of the arctic circle if I could and trade with the Icelanders who stole all our best women but it will not happen I am afraid.

        There is a BoE set withen bank of Ireland that run this country or part of it and thats about it really.
        I even noticed a young BoE guy over here recently talking to a goverment committee on fiscal affairs……..
        The writing is on the wall.
        Ireland never did monetary sov or monetary gaming stuff – they will just go for the old programme of fiscal independence.
        I wish it could be different but it will not be.

        There is a certain logic to it from a geographic trade relationship thingy especially at higher energy prices which makes distance a factor but of course they will rape the gaff.

  5. The Dork of Cork.

    Here is a typical establishment Irish reaction to a reasonable comment. (irish economy blog)

    first the reasonable comment :

    “What is the difference between Ireland and Iceland, one letter they kept their fish and the deeds of the country. The Irish political class gave away the deeds and the fish and got what in return – The vague promise that the EU may look at the promissory notes sometime – That has to go down with the sale of Alaska by Russia to America for 1 million dollars as the worst deal in history. At least the russians got 1 million..”

    Establishment (I guess) although one never knows in Ireland , there are so many Dorks you see….

    “The differences are:
    1. 50% devaluation.
    2. Closed economy.
    3. State-sponsored property bubble to bail out the domestic banks.

    There isn’t 3 in Ireland as the government have failed on that front for which we can all be thankful”

    Dork : Ok……..Iceland had a higher ratio of external deposits that could and were defaulted on (although why not bonds in Irelands case)
    We don’t know the Bond situation as we were never told

    Why did Iceland have a more closed domestic economy ? was it the currency – it was fully domestic unlike Irelands even before we became official euro choir boys.

    Ireland never really has a Punt (although it was printed twice) – after 1979 we left the sterling peg so as to join the Euro monster…they created a deflation / mini depression in the 80s so that we could become more German , that did not work(we printed in 86) and Ireland only “grew” after 1987 as Londons big bang credit hyperinflation spread throughout the eurozone

    So especially after 1987 we did not have a currency really – it was a proto euro – although we printed again during the first EMU crisis.
    A massive credit boom followed after 1994 , much bigger then the post 1987 mini credit boom.
    But given that we did not have a national currency really after 1995 (1999 & 2002 were the official years) almost all semi – rational domestic activity died.

    The people who became adults after 1994 thus got jobs which do not increase life support – this explains the resistance to devaluation to prevent the export of hard currency / import of oil.
    They simply don’t have the skills.
    They can never get on a trawler – they would be killed or maybe they would sink the entire ship.

    The euro experiment has destroyed Irish society , it has taken away our redundancy.
    I vividly remember Ireland in the early 80s – although euro fishery policy was destroying the industry the fishermen remained.
    The Boat sheds were still active in Dingle back then


    After 1987 and especially 1995 the place & culture was destroyed by touristic and house building activity.
    Although some gems remain .

  6. dolph

    “Obama is now a ‘Brand’: one day after the election the president has one foot out-the-door, he is a lame duck”

    Yes, this is a brilliant observation.

    One of your best posts in awhile. Still, underestimate the libertarians at your own peril. Remember, they have the gold and the guns.

    1. Phlogiston Água de Beber

      Libertarian gold is just as likely to be tungsten as anybody’s. Whether they have guns or not should be a moot point. They are philosophically incapable of forming and maintaining a militia. Keeping their heads down and their mouths shut would be my advice. Not that I think for a moment any of them would ever take it.

    2. steve from virginia Post author

      The Libertarians never had an organizing idea or meme they could safely discuss in public, this left them with an assumption: that ‘machines are productive enough’ (when left to their own devices). The assumption goes like this: if the redistribution tendency of socialist industrial economies can be brought to an end, the output of the machines would magically expand to provide necessary goods independent of exchange limits (which invalidates monetary economics which insists that machines will only produce as many goods as can be sold). This is ‘trickle down’ theory which is why the plutocrats endorse libertarians if for no other reason than they own the machines and rent the money! Meanwhile, there is the parallel assumption that machines can only provide for some, product availability is constrained by exchange and the ‘losers’ can be singled out as a matter of machine process or by way of some judgement of fitness … eugenics, determinism or Social Darwinism.

      If there is one reason to get rid of industrialization, this is it, the tendency toward dolled-up fascism.

      1. mansoor h. khan


        This (my) comment is a little off-topic.

        But I did want to let you I am very impressed with your understanding of our (humanity’s) current energy situation with all its implications.

        I did however want to follow up on a comment you made a long time ago on Naked Capitalism (I think). This comment was something like “Both the Bible and the Quran do NOT the discuss the subject of machines”.

        Can you please elaborate what did you mean by this?

        Mansoor H. Khan

      2. steve from virginia Post author

        The short answer is that both are pre-industrial documents intended for pre-industrial readers, machines — other than hand tools, wagons and boats — did not exist and certainly neither did ‘machine culture’..

        Leaving out the New Testament the Hebrew Bible was compiled about 1000 years before Christ, the Quran was compiled in the seventh century: Industrialization (it says here @ Undertow) began with Gutenberg @ 1450. The first modern ‘product’ was his Bible published in 1455. The printing process leveraged itself into other forms of goods production then machine culture and investigations into the state of nature (materials to be exploited).

        Using Gutenberg’s invention as a model it can be seen that individual goods from any particular batch-run of products from a publisher (or manufacturer) are qualitatively identical while the producer sees decreased marginal cost (economy of scale). From that point the means of production accelerated in importance relative to what was (and is) produced. At the production level there is no difference between a Bible and a comic book.

        What matters then is increased output b/c highest output has greatest claim on (borrowed) funds: the (quantitative) ‘machine narrative’ (of constantly higher output) is elevated above all other things.

        As an aside, the most interesting story about Gutenberg is his debts — his machines like all others since ran on debt! See: http://en.wikipedia.org/wiki/Johannes_Gutenberg

        In the pre-industrial world view, leverage is internal, it is something you (as an individual) must learn. What must be learned can be holy doctrine (teaching of Christ) or strategy (Sun Tzu ‘Art of War) or even superstition (Roman divination and augury). In the post-industrial world, leverage is something to be hired or purchased in a store with more and more debt.

        Internal leverage is steadfast adherence to principles, the more aware of the principles and more thoroughgoing one’s understanding of them, the more successful the individual will be, worldly success being the aim of religion, otherwise there is no need of it. Success itself can mean many different things: success of the prince in managing affairs of state, success in finding contentment (within constrained societies) along with success in business affairs (there was good business before industrialization). “Do unto others as you would have them do unto you.”

        With moderns, it does not matter at all whether you follow one set of principles or something else … you will succeed if your machines are bigger, faster or more powerful than others’ machines or you can control more of them. Success in this environment falls to those with no principles at all. This in turn leads to industrialization as it has evolved today: the mass production of credit money independent of everything else.

        I’m not sure I answered your question, it’s a large topic (full of surprises).

      3. mansoor h. khan


        Thank you for your detailed reply.

        The short answer to your question (about the subject of machines being missing in quran and the bible) is that they both teach men to be “god serving” and thus actually do deal with this issue.

        Economist Clifford H. Douglas in 1924 (and probably others before him) figured out that machines were not being using to serve god (of course the way you serve god is to serve/help man).

        Douglas’ social credit ideas were very close to what Islam would have suggested as the resolution to “greed and money madness” that pervades our current world.

        If we were materially more secure (instead of constantly having to worship the god of money to live) we would be more spiritually balanced (i think).

        Now the real question is why god (the creator) has not guided men to implement “Social Credit” like solution to this madness?

        I believe if the benefits of machines had been shared earlier in the century more fairly (without usury) men would have come to worship the state (those who manage the state, the politicians). Because without actually learning how the economy / money works goods and services production would have seemed like magic to the populace and politicians seem like gods/wizards.

        By going through this pain (which forces humanity to think) we are more “deserving” of the fruits of machines.

        I know, know you are probably thinking that now that we understand MMT (modern monetary theory) and the MMT knowledge is spreading like wildfire the game is over (i.e., peak oil).

        Well maybe. There is infinite amount of knowledge that exists (because the creator is infinite in all that is good: knowledge, grace, justice, beauty, etc.).

        He (Allah) can easily guide one or more of us to solve our current predicament and guide one of us to teach the solution properly for wide use and benefit.

        This could even include some kind of replacement energy source to power the machines (like cold fusion).

        But I don’t want to say we will ever be able to create a utopia here on earth. We can certainly improve spiritually (and even materially, these two are of course connected).

        He still wants to leave plenty of incentive for us to want the infinite (heaven). He is kind of teasing us (i think sometimes). He gave us a right brain which can envision a world which our left brains cannot deliver on. But he can deliver it.


        mansoor h. khan

  7. steve from virginia Post author


    Far Right Costs Romney the Election

    Even with that massive win in the first debate, Romney could not pull it off. There are many reasons: Flip-flopping, inane Chrysler ads, abortion issues by other Republican candidates, war-mongering, and military spending. Hurricane Sandy may have been the final straw.

    Regardless of Sandy, much of the country is sick of war, sick of military spending, sick of idiots who proclaim rape to be God’s work. It is actually conceivable that enough moderates in swing states made last minute decisions based on women’s right issues rather than hurricane Sandy.

    The fact of the matter is Romney dug himself so deep a hole kowtowing to the religious-wrong and war-mongers that even a stunning victory in the first debate coupled with a weak economy and huge unemployment could not carry the day.

    Mitt Romney, Rush Limbaugh Are the Past

    Romney is the past. So is Rush Limbaugh, so are all the extremists and so are all of the warmongers hell-bent on starting WWIII or a war with Iran.


    Here is an oldie-but-goodie that is required reading … if you have children or grand-children (Stuart Staniford), this is another item to beat the tycoons over the heads with:




  8. p01

    “sometime within the next four-plus years the president is going to have to tell the American public the truth about energy supplies”
    This is an interesting subject, and I’ve thought about it some time. I really don’t think that the public will be told, or if they will be told, I’m 100% sure they won’t listen because of anger, and will try and find some other explanation. I never figured out why the depression has happened in Romania until I made the connection with its oil peak and repayment of debt. Until I realized this, I always blamed communism, dictatorship, or a combination of both, although it made no sense why the dictator would go bananas on our asses 0 years after everything was pretty decent (at the beginning of the 70s, it was one of the best places to live, from what I’ve been told). I don’t know anyone else who has made this connection, either in meatspace or in cyberspace. I don’t claim that I’m smarter, just that nobody wants believe that it’s because of the oil and finances, they prefer blaming something/someone else.

    1. Phlogiston Água de Beber

      Even a casual observer knows better. Neither the Second Coming of Millard Fillmore nor any other simian deceitful enough to get elected president is ever going to tell the American Public the truth about energy or any other supply issues. Because (he intones with his best Jack Nicholson voice) the American Public can’t handle the truth!

      Look what letting them know his true feelings about them did for Mittney. He coulda been the one not to tell them the truth. Come to think of it, he did have lots of microphone time these past two years and apparently never uttered a word about it, except to pretend that it’s a simple matter of more drills.

      In the end it doesn’t really matter much, if someone is fool enough to broadcast the truth there will two reactions. Some will take the position that it’s got nothin to do with me and express a determination to hold somebody accountable if THEY don’t go find some more pronto. The rest will waste no time looking for ways to make a killing from it.

    2. Ed

      This is a fascinating idea. Rumania hits peak oil in the 1970s, the dictator (Ceauseceau sp?) goes bananas, the country never completely recovers.

      After the US hit peak oil in the 1970s, governance in the US started becoming all weird too. The US was arguably the best governed country in the world in the 1930s, 1940s, 1950s, and 1960s so in this case there was a long way to fall.

      1. Phlogiston Água de Beber

        Of course it’s what. 🙂

        The IEA has a prediction accuracy record roughly equal to Nostradomus. Then throw in the well known tendency for main stream media to serve as propaganda arms for the usual suspects and you get stories like that.

        It might happen that USA would be top oil producer in 2017, but that would not be a good thing. It would mean that ME fields completely watered out sooner than expected or perhaps were destroyed in WW-III. Pretty much TEOTWAWKI.

      2. steve from virginia Post author

        The grand strategy of the establishment … is to lie and lie some more. There is a 5 million barrel-per-day gap between what the US produces now and what the Saudis produce now, a gap that will not be filled. Why?

        – The US is thoroughly explored for carbonaceous deposits, there are no ‘hidden’ super-giant oil fields anywhere in the US.

        – The fuels in large resource areas — Bakken, Eagle-Ford, even Canadian bitumen deposits — require too much energy to extract … to provide a long-term affordable return. What matters is the final cost of the fuel. To service current levels of use (waste), the available fuel must be very cheap … at the same time, fuel must be very expensive! However: If crude is too cheap (as is natural gas) there aren’t enough returns from sales of the fuel to service drillers’ debts. If the fuel is expensive, users will conserve (involuntarily) and it won’t be sufficient sales … to allow drillers to service their debts.

        – Drilling is very complex and expensive (many rigs and many wells) and there are many less-than productive wells.

        – Promoters have not calculated the cost of externalities (costs of contaminating water supplies, costs of well failures and blowouts and cost of oil-price-driven economic breakdown to the drilling industry’s bottom line).

        The US has added a small uptick to the general trend of depletion that began in 1970, a similar uptick occurred after the Prudhoe Bay facility reached full production. As oil flowed out of Alaska, oil from other fields continued to diminish.

        The number-one crude producer Russia is probably in terminal decline and Saudi Arabia is likely to be (their reserves are undisclosed so a calculation cannot be made). A conclusion favoring terminal depletion can be drawn because the Saudis are water-flooding their giant fields.

  9. Reverse Engineer

    Nice follow up to the Meaningless Election Steve. I’ll cross-post this one tomorrow on the Diner.

    While it is true that no Pol is going to “Speak the Truth” since “We can’t HANDLE the Truth”, I don’t see it as true that the “Truth” won’t work it’s way out here over time.

    “And the people bowed and prayed
    To the neon god they made
    And the sign flashed out its warning
    In the words that it was forming
    And the sign said, “The words of the prophets are written on the subway walls
    And tenement halls”
    And whispered in the sounds of silence”

    I have been commenting on and blogging the Collapse since 2007. In that time period I have seen a lot of change in understanding. Ideas which used to be considered “fringe” are much more possible to articulate now than they were in 2007. I used to be Hooted out of the Hall when I pitched Neo-Primitivism on the Net, no more. I still get Hooted of course, but not out of the Hall anymore.

    The inability of Da Goobermint to effectively respond to continuing and ongoing crisis, both of the Natural Kind like Sandy and the Man-Made kind like what is currently occurring in Greece wakes more people up every day.

    Here in Alaska, conversations I could NEVER have with respect to how to prepare for and deal with Collapse wth my neighbors have become COMMONPLACE now. They still don’t grasp the real REASONS for it, but they do have awareness now it is oncoming.

    Of course, Alaska is a bit different given the low population and a greater than average number of people who rejected Modernity even before the cascade started, but still as I read the Net I see many more people from the Lower 48 and Eurotrashland who grasp this now.

    It is true, we will not ever get the “Truth”from the Center,but the Center will not Hold. There WILL be a One-to-Many Fracture of even greater dimension and scope than the collapse of the Soviet Union here. When (not If) this occurs, the TRUTH will flow out as the Dam breaks.

    The words of the Prophets are Written on the Subway Walls. They will be read.


  10. Pingback: Hope…Change… | Doomstead Diner

  11. The Dork of Cork.

    Great piece in the Irish ( Cork) examiner

    Those cheap German supermarkets Aldi and lidl have spread like a pox in this country – closing down the market towns main high streets.

    A devaluation would knock their business model for six as they require cheap energy inputs and a static or declining money / wage supply.

  12. p01

    I wish I had used a different nickname, but I did not think of Potty Polly when I chose it, the supposedly “reverse pharaoh” by some fantastic theory where the center decentralizes itself in some weird suicidal mission (and manages to hold power after this self inflicting drawn and quartering); p01 is simply the username I had used while working on administering Unixes for some time in my “more neurons and synapses” aka younger days, I got used to it and still use it for most logins. It’s Paul (my real given birth name) written in haxor style 🙂
    I wrote this just in case someone thinks I’m preaching dictatorship as a good thing, as opposed to one of the two very probable scenarios; something like what this guy said:
    “One path leads to despair and utter hopelessness, the other to total extinction. Let us pray that we have the wisdom to choose correctly.”
    –Woody Allen
    The Center WILL TRY to hold at ALL COSTS. The Industrial Dream will NOT be abandoned overnight. It won’t succeed in all places, that’s for sure. You ain’t see the whips coming out yet, far, far from that. I have no say in how this matter will play out, and neither do the pharaohs, the forces at work are much too great for anyone to control at this point.

  13. Ken Barrows

    One of President Obama’s first acts to address economic issues will be to nominate Jamie Dimon as Secretary of the Treasury. That will be a hoot.

      1. Phlogiston Água de Beber

        Well, should those notable unWorthies decline his offer, he has the power to pardon Bernie Madoff you know. If only felonious monkeys are worthy of consideration, why not one with an actual conviction?

  14. Sandor

    While the diagnosis may be correct, the forecast may not be. Chemistry and physics will have a say in this before all is through. The incentives are too great. The assumption doomers make is that we have collectively hit the wall re: the transmission and storage of physical energy at the nuclear level. Maybe, but I tend to assess a greater probability to a breakthrough in the next 20 years. This doesn’t negate the general consensus of the need to prepare for down-cycling and shortages. Just that there’s a path between despair and extinction.

    As for libertarians, they are Nietzscheans. It only ‘works’ if people guided by compassion rather than desire. What we have now is a desire-driven world dynamic. One can also think of compassion as respect. It’s not a ‘touchy-feely-gushy’ (manic-depressive) event; it’s a subtle being. The ‘will to power’ is misunderstood as the will to dominate. It is the will to live creatively and originally. It is anarchic and apolitical. Most human adults are basically like toddlers in that they primarily want to be held, stroked and fed. This is politics. Beyond this is the game of awareness and competence, the realm of personal differentiation.

    1. rdg123

      “The assumption doomers make is that we have collectively hit the wall re: the transmission and storage of physical energy at the nuclear level.”

      I hate all these hypothetical energy liberation devices because untenable population density renders them all irrelevant. Then you’re forced to manage biological processes which really amounts to culling the herd.

      1. Sandor

        agreed. energy liberation doesn’t solve overcrowding, it merely enables it. the population problem is either going to be solved by nature through virus attacks, climate change, etc or humans re-engineering their sex drive. war is not an effective means of ‘culling the herd’. an ice age is coming either way.

        humans tend to be both too infatuated with and too critical of their own species. misanthropy is an untenable posture.

    1. steve from virginia Post author

      I don’t agree w/ Neuwirth 100% as he offers industrial globalism as a default: China makes the world takes. It’s clear he appreciates the persistence of exchange (at the improvisational margins) … so do I. It is probably 30% of the US economy.

      He also appreciates the rags-to-riches story which may be a tall tale needed to ‘sell’ his observations to Westerners. The ‘importers of 100s of containers from China’ dudes mainly aggregate any community discretionary income toward themselves, toward China and toward the developed West.

      There is more cottage industry than Neuwirth credits. I don’t know what it is like in Nigeria/Africa but in Latin America the local producers are vital elements in National economies. Comes to mind any street in Quito, downtown there are vendors selling impellers for blenders (I never realized how central blenders are to S. Americans!) These don’t trade overseas nor are they imported, they are made in little workshops (they are relatively simple to make out of scrap steel).

  15. enicar666

    “the public won’t buy social Darwinism no matter how much religion and patriotic moralizing are spackled over it.”

    They don’t have to buy it – they are forced to live it under the heels of the “taxing authorities”.

    Our local failed, and failing school system continues to raise taxes, raise salaries, and the latest fix will be to hire a new Superintendent at the cost of $200,000+ because we all know that the big bucks lead to guaranteed performance – right?

    Our local failed Mayor – who sued his own City and begged non-profits for donations because he is “BROKE” gives himself and his cousin (the City Administrator…) a nice little raise in the 2013 budget – hey, he’s got fuel to burn, while closing down a fire station and cutting personnel while spending $125,000 on needed “decorative LED lighting”, $30,000 Boat Wash Stations, $9 million in new borrowing for needed projects like a new dance floor at Festival Hall and a $900,000 round-about for a Downtown (in front of City Haul! (sic)) that is dead economically and where merchants don’t pay their property taxes – because there is no penalty for not doing so. In a City that is full of empty, abandoned, and burnt out buildings – which are, BTW – still on the tax rolls as collateral to bondholders (County pays) and listed as assets, $1.1 is being given to a FOJ (friend of John – Mayor John Dickert) to remodel a collection of Downtown buildings into more retail and single bedroom communities for which there is no demand… Of course, TID (Tax Increment District)17 – SEVENTEEN! was created for the project – because no sane person would invest any money here – and hey – what are friends for?

    FULL SPEED AHEAD with the Root River Plan – which will feature “Machinery Row” and turn the City back into a winner any day now…

    44 foreclosures for September 2012. 47 for October. 5 so far in November. A duplex was just sold for $300. THREE HUNDRED DOLLARS!

    The People = PREY
    Government = PREDATOR

    The spirit of Marie Antionette is alive and well in American Government! Don’t worry though – it’s being done for your benefit.

    I have also noticed a recent uptick in the Obits of middle aged males who have died “unexpectedly”. Suicides of the chronically unemployed perhaps?

    1. rdg123

      “They don’t have to buy it – they are forced to live it under the heels of the “taxing authorities”.”

      Yeah but doesn’t pixels “moving” about on a tiny screen make it all worthwhile? Its called trading trinkets for land. And we’re buying it…the trinkets that is.

  16. The Dork of Cork.

    Blackout hits Buenos Aires after a heat wave (its only late spring /early summer !!)


    They are in trouble it seems.

    Of course electric public transport breaks down when you get a larger breakdown crisis

    I hope the city of Medoza is ok.
    They have made valiant efforts to improve their public transport system despite limited resourses with the recent import of 80 second hand Vancouver trolleybuses and the bringing back to life a old rail line with second hand but reliable German trams.


    Perhaps a example of elec. public transport on the cheap – the key it seems is the ancient railway cuttings that remain intact – they are the low lying fruit.

    Cristina doing her thing last year………….

  17. steve from virginia Post author

    Veterans Today looks at Romney failure and the phony ‘war vs. Iran’:

    It was all about manipulating oil and gas futures through controlled news and childish hysterics. Billions were made by the select few, the GOP fatcats, and the American people took it up the rear as usual. It was all a game.


    Has Apple lost its luster? After touching $700+ per share it is down to its long-term trend line @ $537. Q; What does Apple really have to offer that can’t be found elsewhere at lower cost? Now that design guru Steve Jobs is deceased, who will add pizzazz to just another Big Business?


    Gerald Celente: “This is the Mafia, this whole game is rigged …”


    1. jb

      “It was all a game.”

      The war-mongering also keeps gas prices up for the boys in North Dakota for a little longer anyway.

      That fulfills my Celente and Alex Jones quota for 2013; thank you.

  18. The Dork of Cork.

    The extreme neo liberal nature of Ireland is clearly seen in this document.

    Taken from this perceptive left Irish wing blog.

    The aircraft leasing business is interesting (10 % of total world business)
    Of course there is tax breaks all over the shop.

    These funds have orbited the stratosphere for such a long time now , running down capital systems to somehow maintain their advantage over the physical worlds gravity.

    But how much longer can it continue ?
    How much more oil can those who have a financial claim on assets remain outside political systems while burning oil going back and forth to the Caymans & Ireland like the pirates of old.

    I have more of a statist leftish gaullist programme in me I fear so I can become a victim of populism.
    But this speech is striking.

    She wants ” to make sure the machine will never be stopped again”

    There is certainly a rejection of rent seeking of the plantation owners house (US and Europe).
    Maybe the selling of these massive yield machines to the North was a bridge too far for the cotton pickers who must now engage in more manual work to survive ,even the house servants must pick cotton now and thats when you really get political turmoil.
    The taste is now very bitter I think.
    http://en.wikipedia.org/wiki/Cerros_Colorados_Complex (Duke energy)

    And the really really big 1,200 MW
    Its not nice to pay rent on your own assets
    Now that the gas is diving these assets will become more and more valuable to both the rent givers and receivers.

    Ireland may well be the last man giving its blood as it has so little organic yield producing assets that it can reclaim – it has accepted its short life will be that as a conduit rather then a battery.

  19. The Dork of Cork.

    You were correct about the Irish establishment wanting to remain in the Euro to the very last drop.

    This is a classic poker face from our corrupt and /or not so bright sock puppet.


    “Taoiseach Enda Kenny has ruled out a solution for Ireland’s bank debt issue during Ireland’s EU council presidency next year.

    In today’s Bild tabloid Mr Kenny said he had “never” considered pulling Ireland out of the euro zone because of the crisis and that the Irish remained pro-European because they “know where future lies”.

    Not even a increase in political rhetoric …………..such as you cannot treat sov countries like soccer teams or something.

    Nothing NOTHING………..its deeply strange this modern market state – it has no clear chain of command.

    1. rdg123

      “know where future lies”

      Well I’m sure Kenny included the word ‘the’ between ‘where’ and ‘future’ in the actual article but I’m sure he didn’t really mean it.

  20. The Dork of Cork.

    Wepollack at the coalface talks about the lack of command and control.

    with for example people without useful jobs burning gasoline to get to their desks while people with physical skills are isolated from the flow.

    In his other videos he talks of a triage system happening in Long island – but its a sort of propoganda triage where the most numbers can be claimed are back on line rather then saving the most desperate people that can indeed be saved.

    As I said there is something deeply weird about the modern market state – the soviet system was far more functional.

  21. The Dork of Cork.

    UK trade deficit in goods is down somewhat for the third quarter (record in Q2)
    2012 £
    Q1 : -25,415
    Q2 : -28,059
    Q3 : -25,443

    However its oil balance just keeps on getting worse
    2012 £
    Q1 : – 3,092
    Q2 : – 3,544
    Q3 : – 3,750
    However it 2011 Q3 was worse at – 3,835 so we could be looking at some sesonal factors.

    Again the UKs trade balance with Germany is striking in comparison to France.
    Q3 real goods trade deficit £
    Germany : – 5,846 (which could be a record , must check)
    France : + 90

    the China deficit is almost as big (also showing signs of weakness) although there is less overall trade between those two countries
    China : – 5,503

  22. The Dork of Cork.


    section 27 :
    “Other monetized benefits include the additional fuel duty revenues from the increased fuel consumption the higher speeds will cause………………..”


    Now according to the report the British police don’t enforce these speed restrictions so its a bit academic but come on !!!!!
    They must expect the Italians and Spanish will just keep on giving their diesel ration without complaint – and they could be correct !

    The EU is a Brit colony – the proof is everywhere if you care to look.

  23. The Dork of Cork.

    Slovakia and Slovenia are showing major declines in air passenger numbers for the first half of this year at -14 & 13%…..

    Its the banking crisis I guess.
    I like this headline from September ,it cracks me up really.


    Turning Greek again………..every country is turning Greek it seems.


    The Airport data is showing major weakness in all Spanish airports except Barcelona
    Alicante :-12% (jan -April)
    Malaga :- 4% (jan – April)
    Palma : – 4% (jan -April )
    Gran Canaria : -4% (Jan -April)
    The above are tourist towns and explains the lack of money for public transport in the south of the country but Madrid looks real bad also at -8 %


  24. The Dork of Cork.

    Eurostat reporting major declines in road freight during 2011 with Italy the worst hit ………..this explains the weakness of diesel consumption but Italian diesel consumption only really dived in 2012 so we can expect much worse figures for 2012.

    Poland was a the golden child for 2011

    In the road freight transport by distance class (Mt Km) Ireland was the worst hit from 2007 to 2011 with major declines in all distances.
    With sub 50km routes showing a simply fantastic 73.9 % decline
    It also shared top place with Romania more or less in the 50 – 149 km bracket with 43.6% & 43.9%
    Infact total Romanian figures look almost as bad.
    Given its massive drop of car sales and the above figures it looks like another neutron bomb has gone off in that country.

    1. steve from virginia Post author

      It shouldn’t be a surprise, I have been saying this since 2010.

      We’re all Greeks, now.

      1. The Dork of Cork.

        Sure , we are all busted………..
        But that alphabet thingy is going to be difficult.
        What a Fuck up.

        Ireland needs to get out of the Euro pronto – give Dublin to Europe or London or whatever as they need all those pointless transactions to keep going but Ireland proper needs to get out of the gaff.

        It will be like old times – the Pale trading with the rest of the tribes out in the wild grey yonder.

  25. christiangustafson

    Lincoln solved the problem by giving his Demand Notes to his combat-hardened 2 million-man army w/ ironclads and Gatling guns and declaring to the Philadelphia and New York banksters, “Whaddya gonna do about it, thou suckers of cock?”

    LOL, we missed this detail on my 8th grade class trip to Springfield. They did have a World Made by Hand Lincoln country village with olde-timey docents beating flax, however.

    “I need the bankster class like I need a bullet in the head.”

  26. enicar666

    It starts to get really ugly now!

    “The maker of Twinkies, Ding Dongs and Wonder Bread said Monday that the strike has prevented it from producing and delivering products, and it is closing bakeries in Seattle, St. Louis and Cincinnati. The facilities employ 627 workers.

    Hostess, based in Irving, Texas, operates 36 bakeries nationwide and has about 18,300 employees. It warned earlier this month that the strike, by about 30 percent of its workforce, could lead to bakery closures.

    “We deeply regret this decision, but we have repeatedly explained that we will close facilities that are no longer able to produce and deliver products because of a work stoppage – and that we will close the entire company if widespread strikes cripple our business,” Hostess Brands CEO Gregory F. Rayburn said.”


    Conservation by Other Means.

    Meanwhile, I shamelessly plug a film by some locals working to bring Social Justice to Racine.

    Pattern or Practice: The story of how the small town of Racine waged war on African-American and Hispanic bar owners to drive them out of the changing town.


  27. The Dork of Cork.

    Paris T1 extended today

    With both T2 & T3 extensions operational before Christmas…..
    Who can now say Euro austerity is not about buying the core time & extending scarce capital.
    The French based banks will have a interest in printing when the time comes as they can then extract a more sustainable yield from the money supply through their investment conduits.

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