R.P. Barr

Our Longage of Expectations

Recently, I was asked my opinion of a podcast conversation.  Since I find that kind of request to be flattering, I took some time to study the podcast transcript.  The two men having the conversation were Chris Martenson and Nat Hagen.  I didn’t know either one, but they seem to be accomplished so we travel in different circles.  Some of their points agreed with a few I had made in earlier posts, so I judged them to be intelligent and insightful.  But, really, it was the concepts new to me that were fascinating.

The whole thing is available at http://www.chrismartenson.com/page/transcript-nate-hagens-were-not-facing-shortage-energy-longage-expectations.  And, I recommend it.

 They discussed the economy in terms of oil production and consumption.  They pointed out that for as long as humankind has engaged in economic activity, the goal has been growth.  Bigger and bigger, more and more.  Standing still means falling behind.  Today, however, we are rapidly expanding into a wall.  Oil is a finite commodity and as tantalizing as the other sources of energy are, none of them are even remotely ready to replace oil. 

Hagen used the example of ethanol.  We currently produce about a million barrels per year which takes more corn than is used for food.  And, barrel-for-barrel, ethanol produces only 70% as much energy as oil.  Meanwhile, we consume 19 million barrels of oil a day.  So, if my math is correct, we could take a year’s worth of ethanol and replace oil for roughly an hour and twenty minutes.

He went on to explain that the government’s Energy Information Administration (EIA) has statistics on Energy Return On Investment (EROI).  Of course they do.  EROI is how much energy it takes to produce one unit of energy.  Seventy or eighty years ago when a wildcatter could find an oil field, stick a pipe in the ground and get a gusher, we would invest one barrel of energy to harvest a hundred barrels of oil.  That was a pretty good business plan and led to the primacy of the internal combustion engine.  By the 1970’s however, that one barrel of energy would only bring thirty barrels in return.  Still not a bad investment.  Then while the world worried about computer crashes in Y2K, the EROI came in around 10:1, and “the EIA stopped producing data on how much energy it takes to get energy.”  I wonder whose idea that was?  Who didn’t want us frightened by statistics?  Hagen doesn’t speculate on the who, but he reasonably estimates that our return on that barrel of energy spent is in the single digits today.

 We may be forgiven for believing that as oil becomes more expensive, drillers will go to greater and greater lengths to find it.  But, Hagen asserts that “you eventually get to a point, even if oil is $100,000 dollars a barrel, or $1 million dollars a barrel, if it takes one barrel of oil to get out [one] barrel of oil, you’re kind of out of gas at that point.”

What happens to our economy then?  What happens when we can’t grow our way out of our problems?

Martenson and Hagen go on to talk about how the issue shouldn’t be the shortage of oil or fresh water or anything else, it should be about the “longage of expectations.”  We, as a society, nation and planet, need to plan how we will get along when growth has been replaced with contraction.

Here is where they lost me because they went on about living on a smaller carbon footprint, and buying locally.  The elephant in the room, gentlemen, is that what needs to be downsized is us.  There are simply too damn many people.  If the available stuff doesn’t stretch far enough now, it sure won’t if the population keeps ballooning.  Back when society could get 100 barrels by spending one, there were only two and half billion people to use it.  This year we have or will top seven billion.  And, as development in China and India has proven, they all want cars.   Given the chance, like Jay Leno, they won’t stop at one.

Current projections are for population growth to slow--but not stop--toward the end of the century--as we approach nine billion hungry consumers.

We can prepare for the crash mentally—as Martenson and Hagen advise.  We can stockpile goods, which they say won’t do us much good since we can’t possibly cover all the bases.  Even money and gold will have little value when we run out of stuff to buy.  Does that sound bleak?  Remember that everything we use comes to us courtesy of oil—in trucks, planes, ships, and trains.  Run out of oil and we run out of everything else, too.

There is a school of thought that expounds belief in human ingenuity.  Pushed to the wall, we will invent a way over.  It’s a nice thought. 

 

Living Long Enough to Regret It

This morning, I flipped the channel to Bloomburg news just in time to hear the CEO of something drop the final sentence in an interview.  He pointed out that we are cutting benefits to the elderly, I don’t know whether he meant private companies or the government, but both are on the chopping block.  What that means is that everyone is going to have to save more money to prepare for getting older.  In an economy that is driven by consumer spending, that means recovery will be much slower.

From another source, I learned that the average American has $52, 000 in retirement savings.  Assuming that you are average, how long is that going to support you?  Better spend less and sock away more.

 And, how long will that savings have to last you?  The BBC reports that the a baby boy born in Britain today has a one-in-four chance of living to be 100.  A girl has a one-in-three chance.  Of course we Americans don’t have so much to worry about.  The average American male will live 1.5 years less than the average Briton.  Canadians, Australians, and Japanese outlive us by even more.  And, the gap is growing.

 If I may, I will quote from the article: http://www.bbc.co.uk/news/world-us-canada-14070090

 "We weren't surprised that we had lower life expectancies than other countries, but we were surprised by the fact that we were falling further behind," says Dr Ali Mokdad, professor of global health at the Institute for Health Metrics and Evaluation at the University of Washington.

…But the US is a big country, and while parts of Mississippi have a male life expectancy of 67, behind nations like the Philippines, women in areas of Florida live as long, on average, as the Japanese, who top the longevity rankings.

It is precisely this kind of inequality that goes some way to explain why the US - and the UK to a lesser degree - lag behind other countries, according to Danny Dorling, a professor of human geography at the University of Sheffield in the UK.

He believes a more even distribution of wealth, even if the average were lower, could mean longer lives for everyone.

Meanwhile: Elderly Americans have a higher chance of surviving heart disease and many cancers than their counterparts in other rich countries, she says. Where the US lags behind is what happens at a much younger age.

That brings us back to being able to pay for longivity.  Those who want to be able to afford to grow old will not be spending the money necessary to provide jobs for the rest.  Funded pension plans are going the way of the dinosaur.  Social Security was never intended to support people in their old age.  It is a supplement, and one that conservatives want to reduce.  Meanwhile, putting our money in stocks and mutual funds seems to be riskier every day—unless you happen to manage stocks and mutual funds. 

Isn’t freedom great?  Slogans beat soup any day.