THE ONSET OF “DE-GROWTH” AND “THE GREAT SECTOR EXTINCTION”
In the previous article, we examined the scope for tangible value destruction in the global financial system. In some future discussion, we might look at the very substantial empowerment that is being handed to environmental causes by some of the direct and indirect consequences of the Wuhan coronavirus crisis.
Here, though, the issue is the economy itself, and readers will understand that this interpretation is framed by the understanding that the economy is an energy dynamic, and not a financial one.
For those who like their conclusions up front, the single most important takeaway from what follows is that the crisis caused by the coronavirus pandemic has triggered two fundamental changes that were, in reality, due to happen anyway.
One of these is a systemic financial crisis, and the other is the realisation that an era of increasingly-cosmetic economic “growth” has come to a decisive end.
The term which best describes what happens from here on is “de-growth”. This is a concept that some have advocated as a positive choice, but it is, in fact, being forced upon us by a relentless deterioration in the energy-driven equation which determines prosperity.
At its simplest, this means that the near-universal expectation of a future “economy of more” has been invalidated. We’re not, for example – and as so much planning has hitherto assumed – going to be driving more cars on yet more roads, and taking more flights between yet more airports. A seemingly-assured future of more consumption, more leisure, more travel, more wealth, more gadgets and more automation has, almost at a stroke, ceased to exist. Economic considerations aside, the energy supply outlook alone has long since ceased to support any such assumptions.
More fundamentally, an economy which is shrinking is also one that will become progressively less complex. Whole sectors of activity will disappear through processes of simplification and de-layering. The pace of economic deterioration, and the rate at which the system de-complexifies, will be determined by identifiable factors which include falling utilization rates and the loss of critical mass in economic activities.
The inevitable arrives
Seen from the perspective of the energy-driven economy, the crisis is unveiling much that we already understood. Essentially, relentless increases in the Energy Cost of Energy (ECoE) are the constant in an economic (and financial) narrative that has been unfolding ever since the 1990s, and which has long pointed, unequivocally, towards both falling prosperity and a “GFC II” sequel to the 2008 global financial crisis (GFC).
Between 1990 and 2000, global trend ECoE rose from 2.6% to 4.1%, entering a level (between 3.5% and 5%) at which prior growth in the prosperity of the western Advanced Economies started to go into reverse. By 2008, when the world banking system was taken to the brink by the GFC, ECoE had already reached 5.6%.
The next critical point occurred during 2018-19, when trend ECoEs entered a higher band (between 8% and 10%) at which less complex, less ECoE-sensitive emerging market (EM) nations, too, start to experience a reversal of prior growth in prosperity. This latter event has confirmed that, after a remarkably long plateau, the prosperity of the world’s average person has turned down.
The financial and economic ‘high command’ has never understood this energy-based interpretation, and this incomprehension has created a parallel narrative of futile (and increasingly dangerous) financial adventurism.
This is why we can expect a GFC II-type event to coincide with a decisive downturn in the economy. Though the coronavirus crisis is acting as a trigger for these events, we should be in no doubt that both of them were due to happen anyway.
Welcome to de-growth
The term which best describes a downwards trajectory in prosperity is “de-growth”. Many have advocated de-growth as something that society ought voluntarily to adopt in its own best environmental and broader interests.
The surplus energy interpretation, though is that de-growth isn’t a choice that we might or might not make, but an economic inevitability.
Critically, de-growth doesn’t simply mean that the economy will become quantitatively smaller. It also means that much of the complexity which has developed in parallel with past economic expansion will go into reverse.
This de-complexifying process will have profound consequences. As well as determining the pace at which the economy shrinks, the retreat from complexity will impose changes on the shape, as well as the size, of the economy of the future.
Where the rate of prosperity deterioration is concerned, the interplay of two factors is going to prove critical.
One of these is the utilization effect, which describes changes in the relationship between the fixed and variable costs of the supply of goods and services. As utilization rates fall, the per-user share of fixed costs rises, and any attempt to pass such increases on to consumers is likely to accelerate the pace at which utilization rates fall.
The second operative trend is the critical mass effect. This describes the way in which supply processes are undermined by the lack of access to critical inputs. To a certain extent, suppliers of goods and services can work around this effect, by altering (and, in general, simplifying) both their products and their processes. Even so, there are limits to the ability to circumvent critical mass effects, and the likelihood is that capacity will decline, resulting in a corresponding reduction in the range of goods and services on offer to consumers.
Both the utilization and the critical mass factors introduce considerable uncertainty into the rate at which prosperity will deteriorate, but an even bigger imponderable is the combined impact of utilization and critical mass effects. It is easy to picture how these are likely to interact, with, for example, falling utilization rates removing inputs in a way that accelerates the loss of critical mass.
The end of “more”
One of the practical implications of this interpretation is that the current consensus about our economic future – a consensus which we might call ‘the economy of more’ – is becoming ever less plausible.
Until now, virtually all planning assumptions have been framed by this expectation of continuous expansion. We’re assured, for example, that by 2040, there will have been be a billion-unit (75%) rise in the world’s vehicle fleet (requiring more roads), whilst aviation passenger miles will have increased by about 90% (so we’ll need a lot more airport capacity).
These and similar projections are based on assumptions that we can consume about 28% more energy in 2040 than we do now, with petroleum and natural gas supply rising by, respectively, 10-12% and 30-32%. All of these consensus projections seem extremely unlikely to be realised, not least because of the crumbling economics of energy supply itself.
The miss-match between, on the one hand, the assumption of extrapolatory expansion in virtually all economic activities and, on the other, the improbability of the requisite growth in energy supply, seems never to have occurred to those whose plans inform the economic consensus.
What all of this means in practice is that projected rates of prosperity deterioration are conjectural, with probabilities favouring an acceleration in the pace of decline.
With this caveat understood, the base-case generated by SEEDS (the Surplus Energy Economics Data System) provides a useful reference-point for discussion. The model indicates that the average person worldwide will be poorer by 9.5% in 2030, and by fully 20% by 2040, than he or she is today. It follows from this, of course, that his or her ability to carry debt and other financial burdens – and to pay taxes – will be correspondingly impaired.
Simplification and de-layering
Two further trends, both of which are of fundamental importance, can be anticipated as consequences of the de-complexifying process.
One of these is simplification, which describes a rolling contraction in the breadth of choice on offer to consumers, and a corresponding contraction in systems of supply.
The second is de-layering, meaning the removal of intermediate economic processes.
The de-layering effect can be illustrated using food supply as a comparatively simple example (though the issues involved extend right across the gamut of products and services).
The pre-industrial system for supplying food had few stages between farmer and ultimate consumer. There were, to be sure, millers, carters, coopers, green-grocers, butchers and a number of other trades operative between producer and customer, but there was nothing on the scale of today’s plethora of intervening layers, which run from fertilizer suppliers and agricultural consultants at one end of the spectrum through to packaging and marketing consultants at the other.
Looking ahead, the application of simplification and delayering to the chain of food supply suggests that, whilst product choices will narrow (ten sorts of breakfast cereal, perhaps, rather than fifty), some of the intervening layers will contract, whilst others will disappear altogether. Simpler products and simpler product ranges require fewer intermediate stages.
Extended across the economy as a whole, the implication is that we face what might be called a “great extinction” of trades, specialisations and, indeed, of whole sectors. As and when this forward trend gains recognition, it’s likely that businesses and individuals will endeavour to withdraw from activities which are at high risk of being de-layered out of existence.
Surveying new horizons
The economic processes described here are going to have far-reaching implications, most of which will be matters for subsequent discussion. First, though, it makes sense to recap the critical points of the foregoing.
The fundamental change now in prospect is that economic de-growth will set in, and will eliminate most of the expectations hitherto covered by the term “the economy of more”. The rate at which the economy shrinks (and the average person becomes less prosperous) will be influenced by a number of variables, of which critical mass and utilization effects are amongst the most important.
A reasonable working assumption, generated by SEEDS, is that people are going to get poorer at annual rates of about 1%, though there will, needless to say, be major regional and national variations around this trend.
This rate may not sound all that dramatic – though we need to bear in mind that it might worsen – but the shock effects of the onset of de-growth are likely to be profound, not just in the economic and financial spheres, but socially and politically as well.
As the economy gets smaller, it will also become less complex. Central strands here are likely to include both simplification (of products and of processes) and de-layering. The latter will involve contraction in some areas of activity, and the elimination of others.
The coronavirus crisis itself is providing us with a foretaste of some of these anticipated trends. In economic terms, the most important effect of the crisis is the hiatus in the cash flows of businesses and households. The consequent need to conserve cash (and to avoid going further into debt under circumstances of extreme uncertainty) is inducing conservatism into economic behaviour.
Companies and families alike are imposing new and tougher criteria on their expenditures, meaning that households are cutting back on “discretionary” (non-essential) spending, whilst businesses are minimising outgoings wherever they can. Companies are likely to make severe cuts in their marketing spend (because there’s not much point in advertising things that customers can’t or won’t buy), and will seek to renegotiate (meaning reduce) rents, outsourcing costs and other overhead expenses.
If – as seems very likely – this event marks (though it will not have caused) the onset of de-growth, it’s probable that newly conservative attitudes will continue. Consumers are unlikely to go back to “splashing the cash”, even when (or if) something nearer to “normality” is restored. Businesses which have, for example, downsized promotional expenditures and simplified their operations, are unlikely to revert to former spending patterns.
In short, this crisis may well have kick-started the processes of simplification and de-layering described above. Both of these processes can be expected to shrink some areas of economic activity and, in some cases, to eliminate them altogether.
Finally, these effects are highly likely to be reflected in other spheres, causing major attitudinal changes. Voters can, for example, be expected to be more supportive of essential public services, and less tolerant of perceived excesses in the private sector.
Governments themselves are likely, in due course, to recognise the risk of contraction in their tax bases and will, in any case, have gone much further into debt as a direct consequence of the crisis. Pressure for redistribution, and a generally heightened emphasis on economic issues, were pre-existing political consequences of deteriorating discretionary (“in your pocket”) prosperity.
At the same time, it is surely self-evident that governments cannot risk repeating policies which, rightly or wrongly, have been encapsulated into a popular post-GFC narrative of “rescue for the wealthiest, austerity for everyone else”.
Pulp and Paper Times (India)
Somehow I got on the email list for this trade paper from India. One excerpt which I don’t have enough context to speak authoritatively about, but which indicates that government actions are being detrimental to small mills and enforcing higher prices:
“Since March 2020, there have been paper price revisions with an effective increase of 20%, said Mr. Dewan “The enhanced price has been absorbed by the market without increasing of corrugators receivable, even for 5 percent. To some places, corrugators are working on below the cost price pushing them to the imminent closure of the unit.”
In March month, paper mills increased the price of 16 BF (120 to 280-300 GSM) paper by 20%. The price for basic grade paper is now at Rs 24.5 per kg. The corrugation industry is now scaring for a further hike in kraft paper. The increase in price for the lower grades cannot be the same as higher grades. The paper mills may increase the same quantum across all grades after the lockdown period.
“We are expected that the price will go up to Rs. 27 to 28 per kg for a basic grade once the ‘lockdown’ removed. Paper Mills usually decide the paper price in the consortium and don’t sell it at a lower rate. We demand the government to liaise the paper prices between paper mills and box association, in order to smooth functioning of corrugation units.” Mr. Dewan said.
The corrugators are of the opinion that the price hike is orchestrated not reflecting the actual demand and supply scenario.”
You may recall that Mr. Trump received a huge reception in a sports stadium in India just recently. Modi and Trump have some things in common. While Modi originally advised people to go out in the street and bang on pots and pans to scare away the virus, he has now resorted to a 21 day lockdown. Trump’s actions for a couple of crucial months were about like banging on pots and pans, but he also finally resorted to a lockdown. But the lockdown is apparently being used to restructure some business patterns to facilitate more centralized control. A question for the Europeans: Did Mussolini and Hitler actively restructure industry to achieve their Fascist objectives? We know that the Communists in the Soviet Union were brutal in their restructuring…Stalin was quite willing to kill peasants in order to achieve his visions of an industrial agriculture, for example.
PS. Is the ghost of Karl Marx visible around the world again? Marx’ critique of capitalism and industrial production was that once one built a machine to make widgets, additional machines and more production had a very low marginal cost. But the temptation for businesses then becomes to over-produce which leads to prices below average cost. One explanation of China is that they cornered the market on widget machines and, once they saturated global demand for widgets, the price fell below average cost and they have accumulated astonishing levels of debt in a short period of time following saturation. The efforts to prop up prices with protectionism and the formation of centralized and controllable industrial structures and the colonial style control of raw materials (compare Italy and Ethiopia with the US and Venezuela) isn’t identical but it seems to rhyme.
Marx (and Lenin, too, I think) believed that capitalism would self-destruct……….
Here’s an interesting question, I think.
When and if things return to some form of normality, many ‘ordinary’ people will, very briefly, celebrate.
After that, though, most will have impaired earnings, reduced savings, and bigger debts. They will also have experienced a major shock.
How far, I wonder, is this going to have lasting effects on how they spend, and how they vote?
With Labour having a decent leader at last – votes at the next election could swing dramatically.
I’d have to disagree there – I would under no circumstances vote for a party led by Starmer.
What don’t you like about Starmer Tim – possible future economic policies?
Plenty of reasons.
First, “Brexit”. He was one of a large number of MPs (across all parties) who tried to stymie “Brexit” by any means possible. Trying to rule out a “no deal Brexit” meant that, if the EU decided not to offer a deal acceptable to the UK, “Brexit” would not happen. I’m neither an opponent nor a supporter of “Brexit” itself , but I do respect the democratic decision.
By December 2019, the voters were thoroughly disaffected with constant politicking and delays over “Brexit”. Boris opted for ‘get it done’ and I suspect that, left to himself, so would Jeremy C. But Labour fought the election keeping open options for trying to stop it, meaning that voters were being offered yet more wrangling, delay and uncertainty. Labour failed to see this, and got trounced – that was a huge miscalculation, and you can join the dots here. And who was the architect of Labour’s “Brexit strategy”?
More broadly, I think Labour needs to move to the ‘economic Left’ and promote the mixed economy, even more so now that public services are gaining public support just as big business is losing it. I see no sign of Mr Starmer promoting a more Left-leaning, mixed economy, ‘pro-worker’ agenda. I’m not a supporter of Labour, or of any other party, but I do think that John McDonnell would have been a better choice.
I would have been afraid of John emptying that Nation’s coffers – which are empty anyway.
I personally think he would be hell bent on creating a society where not working pays.
I have been thinking about this also and came up with the following common sense conclusions:
– Increased household savings, at least a reduced desire to go into debt, particularly for consumption
– Increased interest in self sufficiency and resilience: maintaining larger stocks of home essentials, and growing food in the garden
– Increased interest in working from home and/or shorter commutes
– Businesses will have even less interest in maintaining a high street presence and shift operations to cheaper (remote?) locations, increasing or building their delivery capacity
– There could be more interest in jobs/industries that still operated during the crisis
– Greater sense of community spirit
Thanks Jonny, I like all of these.
My next tasks are to look at implications for business sectors (selectively), and government, and these are helpful inputs.
It’s interesting that Bernie Sanders has dropped out, and Jeremy Corbyn has been replaced, just as a lot of factors might be swinging in favour of the Left.
In the context of de-growth, one would anyway expect a decrease in discretionary (‘want but not need’) purchases by consumers. Consumer conservatism is likely to feed into this trend.
I’m watching with interest, too, the situation with football, an industry with high fixed costs funded mostly by broadcasting rights, themselves funded (mostly by ad revenues), with additional commercial (branding) income and a modest proportion from matchday receipts. Players at my local team here in Spain have taken a 70% pay cut (cut, not deferral). The English game seems to be tying itself in knots over this. Apparently, if they fail to complete the 2019-20 season, they stand to lose £1bn, including £750m of reimbursement to broadcasters.
Working from home and the associated energy saved by not commuting does seem to be a likely consequence.
This article provides some food for thought on how NYC – and by implication other major western cities – might change post-lockdown
My personal opinion is the recession will last a while as people who were living month to month with no savings will have had a shock and try and build up some savings thus lowering spending in the overall economy for a while.
Indeed so. My hunch is that we’ll see consumer caution/conservatism, with sharp falls in expenditure on discretionary purchases.
I’m also persuaded that monetary velocity will fall sharply, a deflationary indicator.
I think monetary velocity has been declining for some years now. See Hoisington and Hunt quarterly reviews, free on-line. It is possible that inflation ticks up in necessities (food, water, energy, basic infrastructure) while disinflation remains the rule in discretionary goods and services.
Yes, the data supports declining V. This is one (of several) reasons why consumer inflation hasn’t taken off despite increases in Q.
US MZM velocity (the broadest measure available) has fallen to 1.3 in 2019, from 1.7 in 2008, and 3.5 back in 1980. Consumer inflation in 1980 was 13.5%.
M2 velocity was 1.9 in 2008, and 1.4 in 2019.
What happens when we turn labour into an asset instead of a liability ? And vice versa?
The velocity of money. During Weimar hyperinflation the women went to the factory everyday at 12 am to pick up the salaries of their husbands. Because the next day it was worth 30% less.
Currencies don’t work well in de-growth.
Today we collect toiletpaper. Tomorrow we will have a more serious problem. No one from the government will tell you in advance, because they are part of the problem. Their complexity and dependance equals the derivatives markets.
Money velocity has little relationship with inflation (as indicated by the CPI).
Since velocity is just the ratio of GDP to money stock, (usually M2, but others can be used), an increase in money leads to a decrease in velocity and an increase in GDP (or decrease in money) leads to an increase in velocity.
If velocity had any significant relationship to prices, then central bank asset purchases (which should allow cash to bleed into the money supply, thereby decreasing velocity) would be deflationary. This is very counter-intuitive, since many people believe that an increase in the money supply is inflationary.
If manipulation of the money supply could produce inflation or deflation at will, central banks could always control both, something we have never really seen.
That’s true mathematically, of course; it’s how the calculation is made.
But this interpretation depends on the reliability of reported GDP. My view is that real output is nowhere near reported GDP. If I’m right about this, it necessarily invalidates calculations of V based upon it.
Another meaning of ‘velocity’, used colloquially, is ‘the pace at which people spend money’. Stats using reported GDP show a steady decline in V since 2008, and most series show this happening over a longer period.
Have people really become ever more cautious, not just in 2008-09, which makes sense, but in every year since then as well? Using my C-GDP calculation, they haven’t, and that fits with my intuitive belief that our credit-driven economy promotes more rapid spending through an ‘easy come, easy go’ attitude.
Aside from these issues, there’s the question of how inflation is calculated.
I devoted a chapter of Life After Growth to this statistical stuff, and you’ll know about hedonic adjustment, substitution, geometric weighting, imputations and other statistical issues around GDP and prices.
Additionally, chained volume measures make no sense – how do you volume-measure the output of banking, say, or insurance, in a way independent of money (to provide a non-money comparator for calculating the deflator)?
Then there’s the exclusion of asset price inflation, the implication being that asset prices don’t affect consumers’ incomes and expenditures. To give just one example, it’s obvious that asset price changes affect the incomes of real estate agents. Asset prices also influence borrowing behaviour.
In short, we need to redefine how we measure things.
The velocity of the ‘real circulation’ is found to be very stable?
“This paper has suggested a simple model that can account for the key anomalies of the traditional monetary approach. It disaggregates the quantity of credit into a ‘real’ and a financial circulation. In time periods, when the ratio of credit in the financial circulation to credit in the real circulation rises, the simple quantity theory must be expected to disappoint, as it is a special case of the more general quantity theorem of disaggregated credit. In such time periods, a financial boom is likely, as asset prices are driven up by speculative borrowing on the back of collateralised assets. This explains why the traditional monetary quantity theory was not popular in the 1920s and 1930s, and again in the late 1980s and early 1990s. Then the traditionally defined velocity of money declines and excess credit creation can ‘spill over’ as foreign investment. However, during time periods such as the 1950s, when in many countries credit was mainly channelled into the real economy, asset prices remained stable and the traditional quantity theory could be expected to hold. The fact that the model can account for the major anomalies observed in many countries over many time periods demonstrates generality and robustness.
The empirical results for the Japanese case have been unambiguously supportive. The Japanese asset bubble of the 1980s was due to excess credit creation by banks for speculative purposes, largely in the real estate market. The apparent velocity decline is shown to be due to a rise in credit money employed for financial transactions, while the correctly defined velocity of the real circulation is found to be very stable“
Click to access KK_97_Disaggregated_Credit.pdf
Thank you, most interesting, and ‘bang on the money’, so to speak.
Dr Tim. One of the results of the present crisis is that robotisation/automation is likely to increase (robots don’t get coronavirus or need self-isolation). I suppose the main cost of robotic manufacturing will be the electricity consumption which of course relates to cost of energy. Will manufacturing return to the UK (albeit with little workforce required) or tend to concentrate in countries where energy is cheapest and thus influence energy policy in those countries?
I’m not convinced that we’ll see more mass robotisation in manufacturing. Firstly, in many high value manufacturing processes, it’s already been done. I used to run a highly automated manufacturing business with about 160 robots, and we got to the point of robotic saturation. There was nothing more left to automate. Nothing that made sense anyway.
Secondly, in many low value manufacturing processes, it’s not cost effective to install robots (think of food production which employs many low wage workers and is a big part of UK manufacturing).
Finally, the post pandemic landscape will need different industrial strategies. If de-growth is sustained year on year, there will be sustained year on year demand destruction. This will potentially create mass unemployment, the likes of which we have never seen before. Government industrial policy will surely have to adapt to support a more labour intensive manufacturing sector. This adaptation may well involve becoming self- sustaining in most manufactured goods that are still affordable and in demand, and then to protect the economy with tariffs. That’s a very different direction of travel to the current direction, but it looks like the globalisation and growth model has just been blown-up.
There’s no room for future mal-investment, the government really needs to have the right vision on where we are going. I believe that we can bring back abandoned manufacturing sectors and become largely self-sufficient in around 10 years. That’s if we put our minds to it, and commit the resources. It’s more a question of vision and willpower than anything else. Radical views perhaps, but it looks like the future is already destined to change radically. It’s all a question of what that change looks like.
In some ways, this reminds me of the story of when a manager showed a union leader one of the first car assemble robots:
Manager: “Try to get that to join your union!”
Union leader: “Try to get it to buy one of your cars”
For me, automation will only progress in our new circumstances if it has a net beneficial effect on energy use (and emissions).
This challenges the widespread assumption that we’ll use ever more technology in the future. Such assumptions ignore the reality of rising ECoEs.
We’re heading for a shortage of energy inputs and a surplus of human labour capacity. This suggests an adverse outlook for any technology predicated on replacing human labour with higher energy use.
Additionally, both business and consumers are going to be a lot poorer after this crisis. This is going to impact ability and preparedness to spend on technology.
Additionally, both business and consumers are going to be a lot poorer after this crisis. This is going to impact ability and preparedness to spend on technology.
True in a sense Tim – but another way of looking at it is that we have not used a huge amount of oil which can now be put to productive use in the future.
Don’t hold your breath.
From my viewpoint manufacturing has been in steep decline for a long period. It seems that financial engineering and manipulation together data paper passing and financial adventurism has taken over the economy. Financial manipulation rules the economy and the Government solves problems by throwing billions at the issues. We are starting to see serious problems arising from this.
I think we are experiencing another example of this with the Government’s inadequacy in providing Personal Protection Equipment and testing equipment for the NHS although spending billions.
Before anyone gives an example of British manufacturing it must be remember that by-and-large it is foreign owned. Steel, motor manufacturing and IT technology (5G networking) are examples of the decline.
Wally, I can only concur.
But we are now where we are.
You don’t want to hear examples of British manufacturing, but here is the list; JCB, Dyson, RR, BAe . . the usual suspects.
Good companies for sure, but a paltry list.
Manufacturing is not something that you can resurrect like dusting off your old record player turntable. It needs a whole national psychology to go with it. It needs a multi-disciplined, educated and experienced workforce. It needs entrepreneural vision.
I don’t see AI and Automation as being the answer either.
If you are manufacturing only for the domestic market, you will never get the required economies of scale.
To be sure, am not holding my breath.
Thanks Johan and Wally. I think that the British still regard engineers as having something to do with engines (although the derivation of the word is connected with ingenious) and assign poor status to them as well as paltry salaries. Exactly the reverse of the German attitude. Writing this, I just remembered a letter written to my local newspaper about 30 years ago which went something like this. “Engineers like me are treated badly in the UK. In Germany, the engineer is king” signed by Fred Bloggs, centre lathe turner!
As you say, the problem is deep seated.
I lam British, lived here all my life, but a visiting lecturer in Germany on IT systems.
I understand you are German and perhaps we can both see manufacturing from a similar perspective.
Germany depends so much on smaller privately owned manufacturing companies.
Yes. At one point in my career I was also product marketing manager for some technical products used primarily in Industrial, medical and automotive applications. I was based in Munich for about 20yrs. after I graduated, I worked for a very big electrical/electronics company there. Sales were really good all over the world, but England was a backwater. Absolutely no need for, or interest in our products. Even back then, ( 1980-90’s ) there was just no market for industrial products there. ( Ok, a bit of hyperbole, but compared to countries like France Italy & Scandinavia it was literally nothing.) After that I went to the USA and spent 5yrs there. Earned a lot, spent very little and eventually got homesick for German beer.
I’m nearing retirement now, but I still consult on engineering projects for customers over in Germany, primarily out of the “Mittelstand” that you mention.
Here in Spain a modest relaxation of regulations has been announced, so that construction and manufacturing activities, plus a limited number of services, can resume. Other countries, too, seem to be contemplating loosening their lock-down rules.
This strikes me as a moment of high-risk.
I’ve also noted that the Italian football league (Serie A) has been talking about getting all players tested so that games might resume in early May. It’s noteworthy that none of Europe’s top leagues has yet written off the 2019-20 season. In Italy, each team would need to play 12 more matches to complete the season. The number for Spain is 11, for Germany and England 9 or 10, with some clubs one behind others. On the basis of two matches per week, these leagues could complete their seasons in six weeks, or a little less in some cases.
I suspect that, contractually (as regards TV rights, commercial deals and, in some cases, players’ contracts), the end of June is the cut-off point. Counting backwards from there might explain early May. If the 2019-20 season isn’t finished, leagues face huge losses, with the English Premier League exposure cited as £1bn.
The reason for mentioning this is that it’s an example of financial pressures which might cause lock-downs to be ended (or scaled back) earlier than might otherwise be desirable.
This article highlights what I suspect to be the most serious long-term consequence of COVID-19: the final death of human liberty in western countries. Aside from the utterly shameless attempts to single out and slur Victor Orban, the article raises valid concerns.
I have watched Britain devolve into a police state since the 1990s. New legislation was pushed through parliament following terrorist attacks in London and 9/11. Most people naively assumed that these measures were justified and intended to keep them safe. Generally the public are blase and indifferent to attempts to destroy their freedom. Amidst what appears to be an imminent threat to their lives, abstract concerns about freedom of speech, movement, association and privacy, appear to have no importance. People do not seem to understand why the government is something they should be frightened of.
Incitement of Hatred laws turned Britain into a totalitarian state, in which simply expressing a contrary opinion could land a person in jail. There was remarkably little concern raised in the media at the time. Very few people even seemed to notice. Many political dissidents rot in Britain’s jails for nothing more terrible than having said the wrong thing to the wrong person. Anti-terror legislation created Britain’s Terror Police, a defacto secret police force whose job is to hunt down anyone deemed to be an enemy of the state. They have very little public oversight and ‘broad discretionary powers’. The government defines as extremist anyone or any group with ideological aims different to those of the political mainstream. It is a short step from ‘extremist’ to ‘terrorist’ and in fact the only thing needed for an organisation to be criminalized in this way, is for enough MPs to decide that it should be so. The Communications Act of 2016 allowed the government complete access to all online communications and also allowed them to gag internet companies into not revealing that requests for information had been made. The few voices of dissent to the growth of the police state, both in Britain and abroad, have been persecuted, exiled and imprisoned. Men like Edward Snowden and Julian Assange.
Coronavirus emergency powers have removed what little freedom remains. You now have literally no freedom of movement or association without permission. What was brought in as a a short term emergency power will be permanent. There is no public outcry or concern. Most of the public are idiotically supportive of measures that they think are there to keep them safe. This is how liberty ends: with thunderous applause.
I’m asking this question as one of the idiotic public who agrees with the UK’s lockdown measures. My question is just exactly who has turned the country into a police state? Many governments have come and gone since the 1990’s which you cite as the onset of the police state. It’s the same with senior Police officers. They come and go. So where is the thread of continuity that progresses the development of the Police state, and the erosion of our civil liberties? Is there a list of bad actors who should be named and shamed?
Jonny Sumption certainly agrees with you!
In my opinion, if the lockdown is short-term, with the aim of allowing health services to prepare for large amounts of cases, without resorting to repeated lockdowns any time there is flare-up, then I can accept it; the longer it goes on the less I support it. Whether it is worth it in terms of economic and other social costs (rising domestic abuse, suicide, psychological stress), is open for debate.
Regarding the continuity required for ‘covert’ policies such as the erosion of civil liberties that Tony mentions: this is normally explained by reference to the ‘shadow government’, which is also supposedly the reason that there is little policy change when either left or right parties are in the driving seat.
Bats and Pigs
Everyone knows that Chinese eating bats is blamed for the emergence of a novel virus which now attacks humans. But the event is nothing new. Humans have a long list of diseases which derive from our eating and living close to domesticated animals. Now we see these headlines in the US:
“Smithfield shutting U.S. pork plant indefinitely, warns of meat shortages during pandemic”
The CEO warns that we have to make the choice to produce food, and damn the viral torpedoes. Which implies workers covered in blood working closely together in huge assembly lines, or going into chicken houses with birds crammed together in intolerable conditions.
I don’t eat meat…not because I think killing any living thing is murder…simply because I think we are a primate not well suited to eating animal flesh. Yesterday my blood pressure (at age 79) with zero medications was 102 over 62…which puts my risk of stroke (the leading cause of disability in the US) at virtually zero.
This is the sort of issue that a naive rationalist might expect our society to actually think about as we try to restart Normal. I agree with the psychologists I referred to earlier that Americans (and others) will want to get back to Party Time as soon as possible. I am skeptical as to any deep look at reality. Moving to the financial sector, we read that the banks are going to seize shale assets and put them in a special subsidiary with professional management for a maximum of a year, planning to then put the assets on the market as the oil price increases. Same story, as far as I can see. Delusion rules!
PS. If you want to read a funny/ sarcastic ‘letter from the viruses’, check out Dave Pollard’s current blog post: We Don’t Want to Kill You
On ‘party time’, I agree that the initial reaction to the eventual lifting of restrictions will be to fill up the bars, restaurants and clubs (well, those that survive, anyway). But I don’t see that as a lasting feature.
But people are going to emerge from this crisis both poorer and shocked. With incomes impaired, savings depleted and debts increased, I anticipate far greater conservatism from consumers, not least because they will not know (a) whether the coronavirus threat really has gone away, or (b) whether another such event awaits them.
I agree that people will be ‘poorer and shocked’. Dave Pollard’s second down the blog roll post is about how most of GDP is actually not at all productive. I have previously observed that I see about an order of magnitude increase in people walking in the woods. They seem to be happy and carefree…nowhere they need to be, and no need to rush around. I’d guess that their blood pressure is down significantly.
Yet, when Trump opens the gates that he belligerently tells everyone that he alone controls, I expect a stampede back to Party Time. How long can it be sustained? I thought, in 2009, that our future was small farms growing diversified crops. So did a lot of the very young people I was working with. But we were wrong…at least in terms of the next decade.
I guess we will see. The Central Bankers are going to pour gasoline on the dying embers.
Although the eating of meat has been a matter of necessity as much as anything else, primates or not.
In our Northern climes, a pig slaughtered every month November to February for its flesh and blood – and lambs in the Spring – meant that you would be alive to see the Summer!.
Less pig meat, the lower the chance of survival – quite as simple as that.
Moreover, the distribution of pig parts after slaughter was a key feature of the village hierarchy which few know of now.
The grotesque industrial meat industry, supplying poisoned crap 24/7, and humiliating animals, is another matter, of course.
The settlements along the fiords of Norway would not have been possible without dairy cattle. The farms on the south side of a fiord only got sun for a few months in the summer, so they had winter quarters down at sea level and summer quarters way up on the mountain which got more sun and summer grass, with an intricate social structure and habits which supported it all. Turning the summer grass into butter was a key ingredient for surviving the winter. On the other hand, I don’t think they slaughtered very many animals. So long as a cow could produce milk for the butter, the cow was more valuable alive than dead.
In temperate zones, a grazing animal was most valuable as a way to turn stubble into manure. They might slaughter an animal for a festive event, but daily meat consumption of animals was not common among poor people. Hens were slaughtered when they stopped laying eggs. I don’t think I ever ate any chicken except a stewing hen until I was pretty old.
Things were probably very different when the big fauna were being wiped out. But even then, they had no way to preserve a wooly mammoth. The Hadza in Africa still gather, which is reliable, and hunt, which is a matter of chance. When the men kill a zebra, the villagers gorge themselves, eating up to 20,000 calories in a day. Then it is back to 1,000 calories from root veggies for a variable number of days until the men get lucky again.
In the Appalachian mountains, they sometimes smoked meat, but they most prized the salt they could get at the head of navigation on the Savannah River. Salt could be used to salt meat and to ferment cabbage. One account by an old woman recalled that her village sent one wagon to the head of navigation each summer, when the roads were passable.
Of course, all of that is against the backdrop of people’s life expectancy being around 45 years if they survived infancy.
This seems well worth reading.
Essentially, it says that the virus situation in France is more serious than it need have been – and continues to worsen – because these mistakes have been made by the Macron administration:
1. France didn’t close borders, even with badly-affected Spain
2. France didn’t shut down airports
3. Hasn’t taken testing seriously enough
4. Municipal elections were allowed to go ahead
5. France hasn’t enforced lock-downs in so-called “no go” zones (Seine Saint Denis is cited), in stark contrast to the severity of enforcement elsewhere.
Relative to whether we could transition to an Esteem Economy based on something other than money, Ugo Bardi today features a guest article:
“This is the same as saying that we are trapped in a car that is heading speedily towards a ravine, with a functioning brake in easy reach of our hands, but sadly we are programmed not to pull it.
To put it another way, the problem is not to be found in a defect of the hardware (our hands) or in the resilience of the system (the car), but rather in the software code (our head). The software, he argues, is programmed for accumulation, for a growth without limits and without purpose, for constant acceleration. These things are not cultural constructs, but rather inalienable characteristics of human nature.”
The article argues that humans created the current suicidal system, and can change the suicidal system.
I would simply point to the Potlatch system invented by the tribes in the Pacific Northwest, where Esteem was gained by giving away what you had amassed. It CAN be done. I’m not qualified to say whether it can become COMMON.
It’s also worth noting that Nate Hagens frequently tells us that the billionaires he worked for were not happy people…because somebody else had more billions than they did.
‘It’s also worth noting that Nate Hagens frequently tells us that the billionaires he worked for were not happy people…because somebody else had more billions than they did’
Which is why many invested with Bernie Madoff to try and get an edge.
I saw a documentary once about multi millionaires and those who have acquired billions.
On many cases they have to employ specialist firms who come up with ideas on what to spend it on.
Not many looked that happy.
I agree with you; those of my clients that have sufficient are in a good place; those with too much (despite my endeavours to get them to give it away) worry all the time.
Human psychology – the more you have to lose – the more you worry
Don’t forget ‘Beowulf’, where a king is praised as ‘good’ because he gives rich gifts to his followers – food of course, good bread and meat, ale, horses, arms and armour.
Which, of course, made them very useful to him, a bodyguard to fight his wars and die with him if need be.
A perfect life in many ways: fight and feast, remembered in poetry when dead.
Here, from the BBC website, is a striking example of economic illiteracy. The emphasis is mine.
“Britain’s independent tax and spending watchdog has warned the coronavirus pandemic could trigger a record 35% drop in UK growth by June.
“The Office for Budget Responsibility said that this was based on an assumption that the current lockdown would last for three months.
“Under this scenario, unemployment would hit 10%, from its current 3.9% rate.
“However, once restrictions were lifted, the OBR said it expects growth to recover quickly with no lasting damage.”
Obviously, GDP – not “growth” – is predicted to fall by 35%. 35% of current growth would amount to almost nothing. Likewise, it’s GDP, not “growth”, that’s expected to “recover quickly”.
With this kind of reporting, how can the general public hope to understand the issues?
Actually, the OBR report itself is more nuanced. It assumes three months of lockdowns followed by three months of gradual easing – but concedes that longer disruption could cause lasting rather than temporary damage to the economy.
Did you send them a short comment/correction?
I wouldn’t bother.
I’ve complained before, to no avail:
– Once when they illustrated an article about Mr Trump with pictures of Mao and Stalin. (They have bashed Mr T almost daily since he got elected, but never criticise Macron, Trudeau and others)
– Once when they referred to Brits living in Spain as ‘ex-pats’, but people moving from Asia (etc) to Britain as ‘immigrants’. Their answer was that these people preferred to be called ‘ex-pats’ – have Indians moving to the UK expressed a preference for being called ‘immigrants’? (I doubt if they’ve been asked)
– Once when they referred to Mallorca as ‘Majorca’, whilst insisting that (for example) Bombay is ‘Mumbai’.
They seem hopeless self-opionated, and doctrinally PC-“liberal”.
(And, on economics, clueless, hence the 35% fall in “growth”)
One might say that the level of reporting by the BBC is perfectly calibrated to the that of the general public, who are probably not paying that much attention anyway, wondering where the food bank is….
But yes, it is dismaying.
One big difference, I think, is that the British public remain libertarian at heart, whereas the BBC is not.
The BBC has a ‘party line’ on a whole string of issues, and tolerates no differences of opinion on those issues. This saturates their political coverage, i.e. their extreme hostility to Mr Trump. (I tend to think that “if the BBC hates him this much, he can’t be all bad”).
It is steeped in identity politics, often running itsems based wholly on the identity of the person they’re commenting on, rather than relevance or importance of the story itself. Even their sports coverage is loaded.
I couldn’t help but see in a News report from the US that many are having to rely on food banks and massive queues had formed.
Not good news but what struck me that it wasn’t queues of people but long lines of SUVs
UK Govt has painted itself in to a corner (we are to have another 3 weeks lockdown). This GP asks questions I wish the MSM would ask:
“When lockdown restrictions are lifted this does not mean that the virus has gone. It does not mean that people cannot infect each other. It does not mean we can simply carry on as before. It means that we have kept the first surge under control.
So, what is the exit strategy? The answer is that we don’t have one. We have a strategy of delay and mitigation which will continue until… when? Until everyone has been infected? Until we have an effective treatment? Until we have an effective vaccine? Until enough people have been infected that we have achieved herd immunity?
The Government must tell us the truth and be clear about what end point they are seeking to achieve. Only then can we have an exit strategy. One thing for sure is that this lockdown is not a way to defeat the virus.
I also highly recommend Hector Drummond’s blog – extensive use of ONS statistics and his position is lift the lockdown.
I agree – but I have to say that the UK is, overall, does seem to be doing a better job of this than a number of other countries, the US and France coming to mind as examples.
One problem that I have heard about is that the 80% pay of workers laid off isn’t paid directly by government, but is paid by employers, who can then reclaim it about two months later – but what if they run out of money?
Also, some – but not all – banks seem to be gaming this, demanding security from business owners (despite the government guarantee), and demanding interest of as much as 22%, even though the government is lending to them at effectively 0%.
The process of loosening the restrictions is going to be a point of high risk, I believe.
This article makes the case that the UK governments’ efforts to support SME’s has been shambolic:
Three reasons there is no exit strategy:
*We do not understand what we are dealing with. The new data from Korea indicates that a number of people can be re-infected. If this means that the virus is mutating to avoid the initial formation of antibodies, then it is really bad news for ‘herd immunity’ or ‘vaccine’ strategies (IMHO)
*The best strategy (IMHO) is to encourage the general population to avoid all chronic diseases. This is entirely achievable, but would require the destruction of much of what we have built using fossil fuels. For example, we know that walking or bicycling to places we need to go to is health promoting…while walking tracks in gyms is an exercise of hope over experience. We know that eating whole plant foods with as little processing in factories as possible is a very healthy practice…but destroys a lot of GDP.
*We know that there is entirely too much unresolvable stress in the world. I went to a physician this morning to get a troublesome growth removed. I went in yesterday, and she looked at it, and said, ‘I’ll have to schedule this’. She looked at her calendar and said ‘most any time tomorrow’. What does that tell you? Family practice physicians are lacking patients. I commented to her this morning that I see an order of magnitude more people walking in the woods, and that such a practice is likely causing people to feel better and not go to doctors. She said, “Of course…but it’s bad for me.” We have constructed a high stress world and built an expensive system for dealing with or defusing the stress.
The worst of all possible worlds is that we continue to refuse to see that chronic disease is a choice (except for the very old and a few who are just unlucky), and we refuse to acknowledge that a high-stress society is not sustainable…all the while that Central Banks and Treasuries are engaged in massive money printing.
As a complement to what I said above
I wrote the previous note, then listened to this discussion between two doctors which, I think, is supportive of what I said. In addition, you get an inside look at the fecklessness of the official United States response to what we should have paid attention to back in December. (But not to fear, we have leaders posing as General Custer….saving the world or headed toward the Little Big Horn???)
Tim, while I broadly agree with you, is the US worse than us? Given their much larger population, their fatality rate looks lower than ours, especially as our figures have ignored the many deaths in nursing homes. They don’t seem to have suffered real capacity problems, even in NY …and, as here, there is a big difference between the big cities and the rest of the US. The US situation is not good but Trump sensibly shut borders (ours are still open as are those of France!!). Trump has also encouraged the use of choloroquine on the sensible basis that there is little to lose and much to gain. Contrast this with Macronapoleon’s clumsy attempts to muzzle Dr Rouault in France. And what is the UK Govt’s position on this? Silence?
All sides in the US are grown-up enough to recognise that the economy has to reopen if the cure is not to be worse than the disease. This is a very difficult decision but the nettle has to be grasped. Here our politicians are passing the buck over this issue, not helped by a leadership vacuum because of Boris’ illness. The US is also doing better in terms of getting financial relief to those who need it.
There is an awful lot of sound and fury in the US because both Trump and his opponents are using this crisis for political ends…..with a major election looming. Has Biden died….or is he just being shuffled sideways to make way for the Hildebeest, with Cuomo as her running mate?
It is indeed a mixed picture. On keeping borders open, which I agree is crazy, I note that the UK health secretary argued (on wholly specious lines) against shutting down air travel. On the other hand, I think Mr Raab and Mr Sunik are handling this pretty well, so far.
The new UK opposition leader has demanded that the govt publish an exit plan (which no government can possibly have yet), which is the kind of thing I’d expect of him.
In an election year, US politicians are of course using this for political ends. I think Mr T has struck a chord with many Americans over China, and the WHO. The cynic in me is tempted to ask, if Biden was dead, how would we know? I’m non-partisan, especially on US politics, but I’m dismayed at the lack of credible candidates amongst the Dems.
On ‘Macronapoleon’, great line. I once heard that ‘every French president thinks he’s Napoleon, except for the ones who think they’re de Gaulle’. Macron seems to think he’s both. The French public deserve better.
I think Mr T has struck a chord with many Americans over China,
Americans are congenitally incapable of thinking about the problems Americans cause themselves. Thus, while medical professionals can easily put the pieces together that the reason their lives are in danger is because Trump was dismissing the potential for the Covid epidemic to become a pandemic. He was actually confronted by a ‘hockey stick’ which he has spent many years deriding in terms of climate change. Easy to make the transition to ‘there is no such thing as a hockey stick in terms of a viral infection’.
When you have screwed up so epically, you find a scapegoat. And the public is all too willing to believe that ‘it’s not my fault…it’s those bad guys’. The Chinese started out with the same denial at the executive level, but then pretty quickly shifted gears to a head-on response…which the West labeled as ‘inhumane’. My understanding is that the Chinese executives have now blamed some lower level people in Wuhan, and there have been arrests. I can believe the German doctor’s story that the virologists in China persuaded the central government that they had a crisis on their hands.
Even the Smithfield plant can be explained with blame shifting. Yes, it is true that the Smithfield plant was packaging pork with a couple of hundred infected workers. But….the Smithfield company is now a wholly owned subsidiary of a Chinese company. Never mind the fact that it operates the same as it operated under American ownership.
The average American cannot look at the objective facts of their ancestors treatment of Native Americans, nor can they look at the objective facts of the spread of the many disease causing animal origin viruses which were pictured on Dave Pollard’s blog. One attempt to get Americans to look directly at the truth is the re-enactments of the debates about the Declaration of Independence in the restoration at colonial Williamsburg, Va. We are herded into a room, given a little democracy talk, then 90 percent are ordered out of the room. What they were talking about was a democratic process among 10 percent of the people. Thomas Jefferson agonized over that ‘all men are created equal’. He seems to have come down on the side of ‘yes, all Homo sapiens are men’….but economic reality requires slavery. It certainly did in his case at Monticello. In order to have a chance of achieving his vision of a ‘yeoman democracy’….he had to kill a lot of Native Americans in order to free the land for white settlement.
I don’t single out Americans as particularly incapable of looking at reality…I just know us better than I know, let’s say, an Australian aborigine.
Even when facts are presented infront of Trump he calls them fake.
Verified facts then become lies – you cannot argue with this man – he has a lie for everything.
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Latest report from Steve Angelo. Scary reading indeed.
THIRD STAGE: Oil Demand Falls Again When The U.S. Economy Heads Into A Prolonged Depression
With U.S. unemployment reaching 15-20%, the longer-term economic impact of the LOCKDOWN will be experienced during the second half of 2020. This is when we head into the THIRD STAGE of oil demand destruction. The THIRD STAGE could take place over a prolonged period.
The U.S. economy will never recover back to the pre-coronavirus level. U.S. GDP of $21.4 trillion in 2019 was the ultimate peak. Of course, if there is massive hyperinflation, we could see a higher GDP figure. But, that won’t be based on real growth.
Americans have no idea just how different the world will look in the next five years. If you don’t own any physical GOLD & SILVER, it would be a wise idea to considering doing so.
Steve’s view appears to corroborate that of Gail Tverberg, who has maintained that falling affordability of oil products will result in peak oil production.
Gold or 7.62X39? I would argue the latter will take the former.
An essay on Trump’s approach to climate change and to coronavirus:
What we are seeing in the polls is the triumph of propaganda over substance. OR, it may simply be that the Democrats inability to field a credible candidate and their refusal to address the ‘lack of a narrative’ problem (other than the tired political correctness) makes Trump look better than any alternative.
Dmitry Orlov with a logistic curve analysis of Covid 19:
He asks that we spread the news. His analysis says it is in line with the H1N1 pandemic of 2009…but this time we are collapsing the economy. He predicts that those countries who have been kicking the can will not be able to recover. The failure of the economy to recover will lead to political collapse.
I’ve not looked at this yet, but I cannot recall that we had anything like this – rates of infection, deaths and so on – back in 2009.
My view, of course, is that the economy isn’t going to recover, because de-growth had started anyway. So far on politics, I’m not going further than predicting profound change, rather than collapse. Obviously, this something of a moving target, depending, in large part, on how public perceptions change.
I’m not endorsing his projections. They may be as good as anyone’s, but I question why a few locales developed much high death rates than other locales. Why are there so many more deaths in NYC than in LA? There is anecdotal evidence, but I wonder if it doesn’t have something to do with wave dynamics…every tenth wave will be a lot bigger than the other nine because of random reinforcement.
(my own explanation is that the target for the virus is those who eat in Jewish delis. I used to live across the street from one, and it quickly turned me into a blimp. I think it was Woody Allen who said ‘Jewish delis have killed more Jews than Hitler’).
He gets a very high correlation co-efficient, but as I mentioned earlier, the same thing could be shown for Hubbert curves and Peak Oil. Except that it turned out that the curve needed to be fitted by region, by technology, and perhaps by price. Instead of population, I think the ‘target’ should be calculated as those with chronic diseases. But so far as I know, such measurements are not readily available. At any rate, beware of oversimplification….as simple as possible, but not too simple.
I see money velocity is mentioned a few times on here and had to look up its meaning.
Something that’s puzzled me is the relationship between money velocity and CO2 emissions, given that every pound spent generates CO2 to some extent.
That’s what consumption does. Burning energy and create pollution. Tyrannosaur said we need a bigger brain. But bigger wasn’t the solution. He should have known that.
Dave Pollard on Covid-19
In contrast to Orlov’s use of a logistic curve, Dave Pollard takes some numbers apart and does some ‘reasonable assumption’ calculations. It turns out that the percentage of the population which was infected, and thus has at least some protection for the future, may be very small. If the economy is restarted, then it is reasonable to expect that most people will be infected. The death toll could be much larger than the trending numbers right now.
Assuming that re-infection remains a small issue, then testing for anti-bodies, which is done quickly, will help us gauge the risks of re-opening the economy and infecting those who are not protected. If the virus mutates, my guess is that all bets are off.
For a ‘science kids’ take on it, see:
The girl is 13, has graduated from high school, and is on her way to college. What kind of world have we built for them to inherit?
For a brief period post-WW2 of some 20 years or so – in the more privileged regions of the world only of course -i was possible to conceive of life as something inherently and naturally pleasant and comfortable: rising per capita wealth, innumerable labour-saving home conveniences,the exciting escape offered by mass tourism tourism, antibiotics, etc, all nurtured this illusion. Utopia seemed not to be a myth, but perfectly attainable.
The Age of the Masses, so feared by many intellectuals and the cultured before the war (unless Marxists), – being seen as a nightmare of blandness and conformity – turned out to be rather nice indeed, and the masses just loved it and looked forward to their pensions even if they couldn’t make it to money for doing nothing (the grand aim of almost everyone, if they are honest about it) any earlier in life.
That’s all ended long ago: and now the succeeding Age of Delusion in which we tried to treat as normal the ever-less plausible extension of that original burst of real prosperity is disintegrating, and largely shut our eyes to the havoc that wealth-getting had inflicted on the Earth.
We will see a reversion to an earlier, more realistic, conception of life, based on the hard experience of finding and struggling for sustenance among scarce resources.
So my answer to ‘What are we leaving them?’ is that those young people will find the world to be what it almost always has been for all human beings: brief, hard, disillusioning, tragic. Only, sadly for them, depleted, sterile, parched and poisoned, too, and even in the previously more-favoured regions of the planet.
They’d better equip themselves, somehow, with a suitable philosophy, for cleverness and good grades will not be enough in such deteriorating circumstances, as we all find ourselves in the ineluctable grip of decline.
It would be good, too, if their teachers and parents were not to fill their minds with political myths, Utopian fantasies, and ideologies belonging to the 20th century, and instead to tell them frankly how we got to where we are.
The girl’s parents, who I know through the internet, are entirely positive. The girl’s brother is 16 and attending college. The mother is a graduate of Khyber University, who has gone on to more academic success, including a PhD from Columbia in NYC. The father grew up in Virginia, of Middle Eastern origins. He is an MD, and is completing his PhD work. They head the neurological work at Loma Linda University in Southern California, and live in a very nice beach community. They bought an enormous white board, and the parents frequently talk with the children and each other, diagramming their thoughts out on the white board. I saw a picture of the white board where they were discussing the power of ‘purpose’ in organizing one’s life.
If confined animal feeding operations and the stuffing of animals with antibiotics were to disappear tomorrow, they would all cheer. Because of their professional work, they see just how dangerous and deadly these practices are. Because of their work in nutrition, shortly after their marriage the husband stopped eating meat and the wife cut down on the sugar. Their health and their lives got better.
Is it really that simple? Have a purpose. Work through the science. Find a partner. Support each other.
That’s the family philosophy. I don’t know whether they will slam into burnout. Loma Linda is a Blue Zone, where people live long and healthy lives. But just across the street is the desperation zone of San Bernardino…high rates of sickness and social dysfunction. They do clinics and talks in churches and such to try to help. I hope they find enough success to avoid despair.
It looks like the Police State isn’t just a British thing. Though I personally believe that Britain is the worst offender in Europe. This happened in Germany:
‘A German medical lawyer who criticized the coronavirus lockdown law was arrested and taken to a psychiatric ward, where she says she was violently abused by authorities.’
‘Bahner called for a nationwide protest on Easter Sunday to “end the tyranny at once,” before Heidelberg Police announced that they would seek to prosecute her for inciting Germans to break the law.’
A clear example of the state using its power to stamp all over an individual who questioned its absolute power. Apparently there is now no right to peaceful protest in Germany and freedom of speech if it is deemed to encourage others to break the law? At some point, Europeans will have to realise that they are no longer living in democratic countries. In many cases, they never have.
The west now has it’s very own Soviet-style political dissidents (Julian Assange and Edward Snowden). Ironically, Snowden was given political asylum by Russia! Beate Bahner joins a long and growing list, most of whom you will never hear about in the mainstream press.
The – to my mind disgraceful – treatment of Assange, and others serves to remind us that if you play with kings in their games, you may well find yourself without a head.
Unfortunate, unjust, but it’s always been so. Even those who are not deemed ‘traitors’ or spies are often used up and cast aside, cynically betrayed or go without a proper reward for loyalty.
Increasingly unnerving is the combination of “elite” incompetence and authoritarianism. France is a good example: an ultra-severe lockdown on many while the Paris banlieue is allowed to go its own way and France’s borders and airports remain open. In the UK, not quite the same but similar. Full lockdown but airports open with arrivals not being tested or quarantined. Our new Gauleiter, Matthew Hancock talking a good game about COVID testing but failing to deliver. Financial aid failing to reach small businesses and their furloughed staff. Elderly COVID patients being decanted (“to save our NHS”) from hospitals into care homes where the disease seems rampant, proper isolation is not possible and underpaid overworked staff lack PPE. While ministers take full pay and perks but bury their heads in the sand about restarting the economy, in case there are problems and people start pointing fingers….which they will anyway..
It just occurred to me that I linked two people, Dave Pollard and Team Sherzai, who have some things in common. Dave can deliver some of the most intriguing and thought provoking analyses of situations I am aware of. He spent a lot of his career working on what we used to call ‘organizational development’. After his retirement, he wrote at least one sentence which indicated to me that he thought he never really accomplished much with that work. Organizations are going to stumble ahead regardless of what some outsider comes in and says to them. The Sherzai’s go into churches in San Berardino where the congregation is old, overweight women and there are no men…because the men have died from vascular disease. Can two scientifically oriented people turn around a situation which has resisted social reformers for generations?
I heard some other (can’t remember who) public health person say recently ‘we keep doing our best but we aren’t moving the ball’.
The lockdowns and fear (whether it is necessary or just expedient or damaging or a plot to distract us from our financial debacle) are opening eyes to the possibility of doing something different. Whether the experience will make any difference when America is once again ‘open for business’ (as Bush II said immediately after 9/11) remains to be seen.
Our host has been quoted extensively by another UK blogger I follow, Tim Watkins:
For those who think we can be weaned off fossil fuels and that there are ‘renewable’ sources of energy out there waiting to be accessed, the following PDF article is worth reading.
Click to access R-0319-MM.pdf
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I’m truely surprised that commentators who can drill down so deeply cannot see that collapse is unfolding. This isn’t either a recession or a 1928 style depression. This is the collapse that Tainter and Catton and more lately Arthur Keller and I have been predicting.
Perhaps it’ll help if I explain my position on this.
The vast majority – amongst economists, politicians, opinion-formers, and the general public influenced by them – think that this is just a glitch, however long and nasty it turns out to be. They point out that even the Great Depression of the 1930s eventually came to and end.
Those of us who disagree with this are in a small minority. Within this group, some (pre-Wuhan) anticipated total collapse, whilst others foresaw more gradual “de-growth”. I can see a case for, and respect, both points of view. I think we’d all agree that the coronavirus won’t be the cause of the downturn, but the trigger for something long made inevitable for all of the reasons that we understand.
For these reasons – and because I think there’s a lot that simply isn’t clear yet – I think differences within what I might call “the de-growth community” matter far less than the gulf between us and the dominating Pollyanna consensus.
Trends do support the collapse scenario, but complexity makes prediction in complex systems imprecise at best. Niels Bohr and Yogi Berra (among others): “Prediction is difficult, especially about the future.”
I’ve subscribed to your blog after skimming it. I knew Al Bartlett personally and brought him to a conference in Toronto some 20 years ago. Humans are threatened by the feedback from our overshoot, with self-culls ongoing as well. Life in some forms will probably outlast us on this planet. Meanwhile, most of us will proceed on auto-pilot following the Maximum Power Principle. https://www.ecologycenter.us/ecosystem-theory/the-maximum-power-principle.html
The only exceptions I’m aware of are voluntary simplicity and suicide. By far, most simplicity is involuntary.