#222. The Forecast Project


In the Western world, at least, there’s an almost palpable sense of public uncertainty, anxiety and discontent which might be attributed to a variety of causes.

Some ascribe it to specific issues, some to the over-reach and incompetence (or worse) of governments, and others to widening inequality between “the elites” and everyone else.

The view taken here is that the deteriorating public mood has a more straightforward explanation, which is that prior growth in economic prosperity has gone into reverse.

The cessation of growth and the onset of involuntary economic contraction are, of course, denied by governments, but this makes popular dissatisfaction worse.

If the economy as a whole is supposed to be growing, but the individual finds that his or her economic circumstances are deteriorating, it’s easy to assume that there must be some kind of bias in the system.

In fact, we don’t need to posit conspiracy theories, or look to ‘the machinations of the mighty’, to explain worsening hardship.

The simpler reality, hidden in plain sight, is that the prosperity of the average person is eroding and so, at the same time, is his or her sense of economic security. Efforts to use financial innovation at the macroeconomic level to stave off this trend have failed, driving people ever deeper into the coils of debt and other financial commitments. 

In short, the average person is getting poorer, and feeling less secure. He or she doesn’t like it, and is baffled and suspicious over official assurances that it isn’t happening at all.

Projection – the land of hazard

Forecasting involves entering territory ‘where angels fear to tread’. But the publication of projections has now become imperative, made so (a) by the rapid worsening in the public mood, and (b) by the incomprehension that continues to inform policy decisions.

The projections that interest us come in two main forms. The first category, covering the economic and the financial, is addressed here. The plan is that broader forecasts, which necessarily include the political, will be tackled in a subsequent article.

To ‘cut to the chase’, analysis undertaken using the energy-based SEEDS economic model reaches two principle conclusions.

The first is that the ‘financial economy’ – the monetary counterpart of the ‘real economy’ of material goods and services – will contract by between 35% and 40%, in real terms, and on a global basis.

This is a process to which asset-prices are over-leveraged, so overall falls in the equity, bond and property markets are likely to be a great deal more severe. In parallel with tumbling asset prices, downsizing of financial commitments can be expected to involve both the ‘soft default’ of inflation and the ‘hard default’ of failure.

Second, economic prosperity will continue to deteriorate, whilst the real cost of essentials will carry on rising.

Reflecting this, the scope for the consumption of discretionary (non-essential) goods and services will shrink rapidly, as will the capability for investment in new and replacement productive capacity.  

Country-specific analysis suggests that, in comparison with pre-pandemic 2019, discretionary consumption in the United States will have declined by 14% by 2030, and by a further 41% by 2040. In Britain, discretionary consumption is projected to be 57% lower in 2040 than it was in 2019.  

Projected trends in discretionary consumption in America, Britain and France are illustrated in the first set of charts, which compare conventional measurement (in black) with SEEDS analyses of underlying trends (blue).

As we shall see, conventional interpretation of past trends has been extremely misleading, conveying the idea that discretionary consumption has continued to grow, from which the inference is that further expansion in discretionary consumption can be expected.

SEEDS modelling shows that the affordability of non-essential goods and services has (at best) plateaued in the United States, and has been trending downwards, over a lengthy period, in most other Western economies.    

Two observations are pertinent here.

First, and obviously, the scope for the discretionary consumption of goods and services that people might want, but don’t need, is poised to fall rapidly.

Less obviously, this deterioration is sharply at odds with what might be expected, based on the misleading prior trajectories shown in black.

A critical point to emerge from SEEDS-based analysis is that these prior trajectories have been distorted, such that false interpretations of the past and present have created gravely mistaken expectations for the future.   

Fig. A

Principles of analysis

The basis on which prior trends are analysed here, and forward projections are made, has conceptual complications.

In principle, the process of interpretation has to move forwards from the past to evaluate financial risk, but backwards from the present to create the preconditions for effective forecasting.

It’s hoped that this apparent contradiction will be clarified by the description that follows.

Let’s start with GDP. This measure, central to conventional economics, is generally assumed to quantify material prosperity but, in reality, it does no such thing.

Rather, GDP is a measure of activity, which is by no means coterminous with prosperity. If liquidity is injected into the system, the resulting use of that liquidity can create activity that has very little material value.

This is exactly what’s been happening over a period stretching back to the 1990s, when governments and their advisers first noticed the phenomenon of “secular stagnation”, wholly failed to understand its causes, and sought in vain to ‘fix’ it with various forms of financial gimmickry.

This started with ‘credit adventurism’ before, in response to the 2008-09 GFC (global financial crisis), ‘monetary adventurism’ was added to the mix.

As well as over-inflating asset prices, this process has created activity without adding value, and has injected unproductive complexity into the economy. It has also led to chronic and cumulative understatement of inflation, properly understood as the rate at which money loses purchasing power.

On this basis, GDP has become increasingly misleading, a confection inflated by the injection of low- or even nil-value activity into the system.

By analysing trends forwards from the past, we can plot the divergence between activity (measured as GDP) and prosperity (calculated using the energy-based SEEDS economic model).

Conversely, though, current GDP is where everyone thinks we’re starting from.

This sets contemporary GDP as the logical point from which forecasts need to begin. This is where analysis needs to reason backwards from the present to reveal the prior trends that will shape future developments.

In other words, we need to think of current GDP both as a polite fiction and as a baseline for forecasts.

Benchmarking the economy

Putting this into practice requires a benchmark, and the reference-point used here is prosperity.

This is calculated, using SEEDS, on the basis of principles familiar to regular readers. The first of these principles is that material prosperity is a function of the use of energy. This is an obvious truism, given that literally nothing that has any economic utility at all can be provided without the use of energy.

The second principle is that, whenever energy is accessed for our use, some of that energy is always consumed in the access process, meaning that it is not available for any other economic purpose. With the ‘consumed in access’ component known here as the Energy Cost of Energy, this is ‘the principle of ECoE’.

In short, prosperity can be calibrated as a function of the supply, value and cost of energy.

On this basis, SEEDS calculates that global prosperity increased by 31% between 2000 and 2020. Allowing for a 25% rise in population numbers between those years, the world’s average person was just 4.8% more prosperous in 2020 than he or she had been back in 2000.

The third principle of surplus energy interpretation is that money has no intrinsic worth, but commands value only as a ‘claim’ on the goods and services provided by the energy economy.

Taken together, these principles point towards the need to draw a conceptual distinction between a ‘real’ economy of goods and services (though ultimately of energy) and a ‘financial’ economy of money and credit.

These ‘two economies’ are perfectly capable of diverging from each other, if we create financial ‘claims’ in excess of the material output of the ‘real’ economy.

This, since the 1990s, is exactly what’s been happening.

Since prices are the point of intersection between the financial and the real economies, inflation ought to reconcile any divergence between the real and the financial economies.

It can only do this, though, if inflation is measured accurately, which hasn’t been the case.       

Forward from the past

The official line, of course, is that material hardship cannot explain popular discontent because, with the exception of the coronavirus crisis of 2020, economic output (measured as GDP) has, with remarkable consistency, grown much more rapidly than population numbers, making people successively better off.

Stated at constant 2020 values, and calculated in international dollars converted from other currencies using the PPP (purchasing power parity) convention, world GDP grew by 94% between 2000 ($68 trillion) and 2020 ($132tn). The global population increased by 25% over that same period, so the world’s average person became 55% more prosperous between those years. 

Bearing in mind that GDP measures activity – and the use of money – rather than prosperity, this claim of rapid improvement in material well-being is easily demolished.

For a start, reported “growth” of +94% ($64tn) between 2000 and 2020 was accompanied by an increase of +190% ($216tn) in debt, meaning that each dollar of “growth” came at a cost of $3.40 in net new borrowing.

Using estimates for broader financial exposure (including the shadow banking system), this ratio rises to $7.20 of incremental commitments for each “growth” dollar. If we further include escalation in the shortfalls (“gaps”) in pension provision, we can arrive at incremental ‘hostages to the future’ of close to $10 for each dollar of reported economic expansion.

In short, since the 1990s, we’ve been inflating GDP artificially by injecting liquidity into the system, and counting the use of that liquidity as ‘activity’ for the purposes of measuring GDP.

The alternative calculation of prosperity is undertaken in two stages. First, the model normalises reported output for the effects of credit expansion.

Second, trend ECoE is deducted from the resulting underlying or ‘clean’ output number (C-GDP), because ECoE, as the first and inescapable call on resources, is the difference between output and prosperity.

The next charts show, for the United States and the global economy, the widening divergence between GDP and prosperity.

It’s worth reminding ourselves that, in a twenty-year period in which GDP reportedly rose by 94% worldwide, prosperity increased by only 31% whilst, for context, debt escalated by 190%, and estimated broader commitments (excluding pension provision shortfalls) rose by close to 250%. 

These broader global trends are illustrated in the right-hand chart. The gap between GDP as reported, and prosperity as calculated by SEEDS, is shown in solid red, and is far smaller than the enormous ‘wedge’ (shown in outline) that has been inserted between debt, broader liabilities, and either calibration of economic output.         

Fig. B

Backwards – and forwards – from the present

As we’ve seen, then, recorded GDP has been inflated artificially by massive credit and liquidity injection. By examining trends over a period going back to the 1990s, we can calculate that 2020 GDP of $132tn drastically overstates underlying prosperity of only $87tn.

The ratio between these numbers provides a measure of the extent to which the financial system, including asset prices and liabilities, will need to contract to restore equilibrium between the financial and the real economies.

Where forecasting forward trends is concerned, however, we are faced with a conundrum. Current GDP may be an extremely misleading number but, for most observers, it’s the point from which forward projections need to commence.

The solution is to use today’s GDP as the basis for forecasts, but to apply our knowledge of underlying dynamics to re-state the way in which that number arrived at where it is.

We can – and, for forecasting purposes, we must – use a base-year (2020) world GDP number of $132tn, but we don’t for one moment have to swallow the fiction that this figure has grown by 94%, in real terms, since, 2000.

In other words, we must use our knowledge to recalibrate the past – not just in total, but in component form as well.

In fact, conventional economics routinely re-states the past for purposes of comparison. When calculating “growth”, economists compare current year GDP, not with its nominal (‘money-of-the-day’) equivalent in previous years, but with those prior numbers restated to a constant, inflation-adjusted basis.

For example, a direct comparison between American GDP in 2020 ($20.9tn) and 2000 ($10.3tn) might suggest growth of 104%, but everyone knows that this number has been distorted by inflation between those years.

The application of the GDP deflator raises the 2000 number to $14.9tn at 2020 values, from which growth over that period is then calculated at a ‘real’ (ex-inflation) 40%.

This is where the SEEDS concept of the Realised Rate of Comprehensive Inflation comes into the equation. What RRCI says is that, whilst the nominal GDP figures for each year might be accepted as an accurate measurement of activity, calculation of ‘real’ change over time has been distorted by a severe underestimation of intervening inflation.

Put another way, the purchasing power of money has declined far more rapidly than official data suggests.

It should, of course, come as no surprise to anyone that inflation has, routinely and to a large extent, been under-reported over time. The conventional measurement of inflation uses a number of questionable assumptions, and very largely excludes changes in the prices of assets.  

Globally, and on the PPP currency convention, nominal GDP was $50.3tn in 2000, and $132tn in 2020. Official data converts the earlier number to $68tn at 2020 values, resulting in the assertion that the world economy has grown by 94%. The official rebasing calculation infers that broad inflation averaged 1.5% between 2000 and 2020.

RRCI analysis indicates that systemic inflation actually averaged 3.5% annually, not 1.5%, over that period. Accordingly, GDP in 2000 is restated to 2020 values, not at $68tn, but at $100tn. This in turn indicates that ‘real’ growth between 2000 and 2020 was 31%, not 94%.

This is very far from being a purely theoretical point, because working out how far GDP has really travelled over the past twenty years also reveals trends in its components.

It’s almost inevitable that past trends act as the basis of forward expectations.

Accordingly, misunderstanding of the past leads naturally to mistaken expectations for the future.   

These components can be stated as “sectors”, which are government, households, financial businesses (such as banks and insurers), and PNFCs (private non-financial corporations). 

For our purposes, though, a more useful analysis is one which divides the economy into three segments, which are capital investment (in new and replacement productive capacity), the provision of essentials, and the supply of discretionary (non-essential) goods and services to the consumer.

Interpretation and projection

Again using the United States as an example, the next charts show three alternative interpretations of the evolution of essentials, capital investment and discretionary consumption, within overall economic output, over time.

The first chart shows nominal GDP, not adjusted for inflation, whilst the second translates everything to 2020 values based on official inflation data.

As you can see in the second chart, economic output, and each of the three segments within it, is supposed to have carried on increasing, even in the recent period in which debt and other financial commitments have been accelerating unsustainably.

On this basis, it might seem reasonable to infer, not just that aggregate economic output will continue to expand, but also that the future expansion of capital investment and discretionary consumption is assured.

The right-hand chart, whilst accepting 2020 GDP as a point-of-arrival for analysis and a point-of-departure for forecasting, uses RRCI analysis to recast the way in which that point has been reached.

The clear message to be taken from this analysis is that both capital investment and discretionary consumption have flat-lined, with the latter already starting to turn downwards.      

Fig. C

The next charts use SEEDS economic projections to carry the RRCI-referenced interpretation of the American situation forwards, and to do the same for the British and the global economies.

For Britain and America, the implications are that, whilst further rises in ECoEs and deterioration in broader resource supply are going to drive economic output downwards, the real costs of energy-intensive essentials will continue to rise.

This means that, looking ahead, both capital investment and discretionary consumption are set to be compressed in ways that interpretations based on mistaken analysis of past trends are incapable of anticipating.

Where global projections are concerned, we’re still in the process of learning the severity of the effect that Western deterioration is going to have on economic performance in EM (emerging market) economies such as China and India. Current indications are that projections for EM prosperity may need to be revised downwards, showing earlier and more pronounced contraction.        

Fig. D 

This dynamic can be expressed using the SEEDS metric of prosperity excluding essentials (PXE).

The next charts illustrate this metric, showing top-line prosperity as a thin blue line, and PXE as a thicker one. The gap between these lines represents the real cost of essentials, but it should be remembered that PXE states the scope, not just for discretionary consumption, but for capital investment as well.

What is revealed here, where America and Britain are concerned, is pre-existing stagnation, followed by impending rapid deterioration, in PXE.

Global calibration seems to show that PXE might not – quite – have peaked yet, but this projection is subject to the previously-mentioned variable about Western effects on the performance of the EM economies.  

Fig. E

Finally, where charts are concerned, the experience and prospects of the average person can be set out by illustrating prosperity and the cost of essentials on a per capita basis. Because population numbers have continued to increase, the per-capita equivalents of the compression of PXE aggregates are more pronounced than the same metrics expressed as aggregates.

In America and Britain, whilst top-line prosperity per person has been trending downwards over an extended period, the real cost of essentials has been rising inexorably.

You’ll notice that, in each of these charts, projection of the per capita cost of essentials ceases in 2030, before the future point at which the lines cross over, and essentials cease to be affordable at all for the average person.

The reason for this is that, long before 2040 – and probably much sooner than that – we’re going to have to re-define what we mean by “essential”.     

Fig. F


Lengthy though this discussion has been, the focus has necessarily been confined to an overview of trends, with selected economies used as illustrative examples.

Our first conclusion, which ought to come as no real surprise at all, is that the ‘financial’ economy of assets and liabilities has become grotesquely over-inflated. This informs us that – because of the dynamic that links the financial and the material – it’s only a matter of time before an inescapable process trending towards equilibrium triggers a correction.

SEEDS analysis cannot, of course, tell us when this will happen, but it can indicate a magnitude, varying between economies but, in overall terms, implying a contraction of 35% to 40% in the financial system as a whole.

The leverage within the equation suggests that the repudiation of liabilities at this scale will translate into markedly more severe falls in asset prices.

It should be remembered that aggregate asset pricing is no more than notional, in the sense that totals thus calculated can never be monetised. If, say, asset values fall by $50 trillion, it doesn’t make the economy “poorer” by that amount. In reality, the aggregate ‘valuation’ of asset classes amounts to nothing more than what we – collectively, and through marginal pricing – choose to tell ourselves that our assets are “worth”.

The second and third conclusions are (a) that both discretionary consumption and capital investment are poised to fall very sharply, and (b) that these contractions aren’t “priced in” to collective expectations for the future, because these expectations are based on severely misleading interpretations of recent trends.       



385 thoughts on “#222. The Forecast Project

  1. Excellent (and worrying) as usual, Dr. Tim. What strikes me in dealing with clients at present is that there are many who are simply oblivious to what is demonstrably happening, but the number of those becoming more ‘aware’ of imminent difficulty is rising. Two examples spring to mind based on recent discussions with clients.

    Firstly, a relatively new widow in her 70s with an unencumbered property that even she admits is too big for her. Her secure income (thanks to the state pension and a small occupational pension) is just over £1,000 per month. She has been advised to ‘invest’ much of her spare capital by a well-known “wealth manager” in an expensive, run-of-the mill, equity and bond fund of funds and been ‘advised’ that withdrawals of 7.5% per annum are not unreasonable! I wrote to her pointing out that this was a very high-risk strategy, and her retort was that “it has worked fine so far”. As a strong believer in reversion to the mean, I think that, at some point, she will end up disappointed.

    Secondly, a couple in their early 40s with two very young children, a large mortgage, and modest savings. Although their earned income has been well above-average, these intelligent people have never experienced anything other that historically low rates of interest and inflation in their working lives. They are now archetypical “squeezed middle aged couple” with demands from ageing parents and their own young family. They have become aware of their potential vulnerability should matters unfold in the way you describe, but there are few “fixes” to their growing sense of precarity.

    Quite where we go from here is anyone’s guess, but with severe financial repression offering -5%+ interest on cash, bond yields rising, relatively low dividends, drawdown pensions being ‘abused’ by far too many, the potential for other investments to decline by as much as half, and the near-impossible to satisfy hunger for income, one can’t but feel concerned. I still believe in the long-term advantage of those Victorian & Edwardian “compounding machines”, investment trust companies, and those concentrating on investing in what people need, rather than want may be helpful things to own over the medium to long-term. Oh, and the security here in the UK that can be offered by annuities in the right circumstances.

    I’m reminded of those lines of Byron in Don Juan (1819-24): “Dreading that climax of all human ills, the inflammation of his weekly bills.”

    Tricky times indeed, but today is always a terrible time to invest, but we can’t control the future, and have to develop realistic hope for future plans.

    • Youtube is awash with ads tempting the cash-strapped elderly (well, about 60 or so) to borrow against their property to redecorate or take holidays – all frivolity. but soon it may be for food and heat.

      You may recall that Lord Byron spent most of his adult life hoping that all would be rectified financially by the sale of Newstead Abbey, his white elephant ancestral property, which he eventually pulled off.

      In the meantime, he wrote charming letters to his creditors, along the lines of:

      ‘Nothing could possibly make me more discomposed than I already am, than the thought of unavoidably contributing to your own unease by being being unable to settle (usually £100k or so) – but alas, I cannot. I am inconsolable, and remain ever your adoring and most obliged servant….’

      I believe this is where most advanced, decaying, played-out economies are at present…..without a Newstead Abbey to cash in.

  2. Wow. Complex, clearly thought out, and explained so as to be understandable. This continuing work really is genius level IQ.

    • I would agree that Dr. Morgan exhibits profound giftedness for understanding the dynamics at play, and for formalising them so eloquently.

      And I say that only partly because I’ve come to the same conclusions hehehe.

  3. I’m not sure these predictions are dire enough.

    Existing energy sources are extremely “highly leveraged”. CAPEX + Gov extraction fees are ~ 90% of cost of oil. With rising ECoE, a 50% decrease in oil use implies a 2x increase in oil prices (crude or product, I am not sure)

    How much will oil (and gas/coal) demand will there be if real prices double?

    • Tresft.

      The “demand” will still be there, it’s just that people won’t be able to pay the cost. Then those people will “demand” that the government does something!

      Bumpy times ahead.🙂

  4. This is an interesting analysis that will stand or fall on parts two and part three.
    The Extent to which the well-described distortion in the balance of economies due to misallocation of credit to purely financial speculation is a difficult calculation to perform.
    Prof. Richard Werner’s work on the theory of disaggregated credit will assist in those inquiries.
    No one ever said SEEDS was not an ambitious departure from financial analysis of the economy to an energy-based analysis.
    Another interesting aspect of looking backward is the time cost of money representing the cost of capital Safras work in the Cambridge controversies is directly relevant to the circularity of monetary-based theories in economic analysis. Ultimately I think that the metrics adopted will have to refer to the work of Creutz
    and Magrit Kennedy.

  5. The concerning figure is your last one (figure F). This is an average and presumably will hide large variation. I think you had calculated some data based on medians which might give a better indication of the position of the average person. Better still would be ONS-type income deciles which would presumably form a time-dependent progression of curves with the two lines crossing over in lowest deciles first. Probably what we are seeing in the UK now – as per Mark Meldon’s examples.

    • as a blue collar worker I’ve been aware of not being able to keep up with the cost of living since before the GFC, I find Tim’s charts convincing because they show in graphical format my lived experience,
      white collar workers have fared better and often live beyond their means, they still have a lot of discretionary spending they could drop to fund essentials,
      at the top of the scale you have people like the BoE guy on £575k pa telling blue collar workers that a wage rise would be inflationary,

      once the white collar workers start feeling the squeeze, discretionary spending might well contract markedly and they’ll also have their discontent recognised in the media,
      hell hath no fury like a Guardian subscriber scorned!

  6. This is where the rubber meets the road, Dr. Tim. Who in positions of power will dare to admit that your analysis has merit? I’ve just shared it with my friends The Contra Guys, in Canada. One has been skeptical of SEEDS in the past. I await his partner’s response!

  7. Thank you again Dr Morgan.
    I believe you have mentioned this before but the declining state of our infrastructure. We will be forced to do triage. Adding higher taxes to replace or repair just our current systems seems unlikely. I guess I mention this again because as the infrastructure begins to fall apart it will add to the feeling of impoverishment and increase the negative views towards the elite.

    • You are right about this, and I might mention two trends that I’ve described here before. One of these is adverse utilization effects, where fixed costs have to be spread across a diminishing number of users. The other is loss of critical mass, where inputs cease to be available.

      An example of this is a bridge, with fixed costs of $10m, and 2 million users. This means that each user has to be charged $5 to cover fixed costs. If user numbers fall to 1 m, the cost component of the tariff has to be raised by $5, driving more users away.

      Simultaneously, critical mass effects kick in if the parts and services required for upkeep and operation of the bridge become unavailable, or rise in cost.

      With both of these effects combining, we can easily see how upkeep of the bridge ceases to be viable. This then affects other activities, such as businesses which rely on the bridge for the delivery of supplies, and on the ability of workers to reach their place of employment.

      There are limits to how well we can model these compounding effects, though SEEDS does attempt this.

      We need to keep an eye on how essential services – including things as basic as postal deliveries – cope with this.

  8. Dear Tim,

    Thank you very much for your most insightfull analysis.

    As you may recall, the « Arab Spring » turmoil – which severely destabilized several states a decade ago – was precisely caused by a rise in the price of « essentials » above what could afford a significant proportion of the population from those countries.

    As for the definition of « essentials », you will easily appreciate that it varies significantly as a function of where you live and, in particular, at which latitude.

    Furthermore, the purchasing power of a national currency and it’s future evolution being ultimately pegged – in the physical world – to the amount of net energy that will remain available in that country in the coming years, it might logically be inferred that the curves that appear on your « Fig. F » are not going to be the same for all countries or even regions of some countries.

    Finally, as it is likely that the value of high EROEI energy sources is fully appreciated in some high level military circles, geopolitics will conceivably need to be taken into account in the equation that will ultimatly determine the « cost of essentials curve » for some countries.

    Have you attempted to modelize these factors in order to establish a set of data for each significant country on Gaia, in particular related to your Fig. 7 ?

    Best regards,


    • Thanks John.

      Where individual countries are concerned, SEEDS covers 30 economies (though there are problems with obtaining necessary data for Iran). In this article I’ve had to concentrate on the global situation.

      If things go according to plan, I’m hoping to look at broader forecasting issues (including government) in a subsequent article. These broader issues are clearly important, but will be tricky to work out. I’m hoping that we can advance on this by having solid economic fundamentals in place.

  9. Thanks once again. The financial sector indulges in the self-serving fantasy that it has an independent existence; but to anyone with a measure of science literacy, it’s bleeding obvious that resource limitation issues – which essentially come down to access to energy – define human prosperity. Those limitations are increasingly crowding in on us.
    Meanwhile our adversarial parliamentary system encourages politicians – of the left or the right – to promise us pie-in-the-sky endless ‘growth’ and the glossy-magazine lifestyle for all. The reality is that prosperity is falling. That certainly seems to go some way to explain the recent societal unrest – truckers, anti-vaxxers, trumpsters. Politicians’ unrealistic promises are coming home to roost methinks.

    • I tend to draw a distinction between the financial sector and old-style, wholly financial interpretation of the economy.

      It seems clear to me that economic hardship and resentment inform a lot of protests which appear to concentrate on other issues. Much current unrest can be traced to economic issues which the authorities either don’t understand, or try to deny.

  10. Tim: Excellent again. This is one that could make it to the MSM quickly (if only someone there was reading outside their bubble).

    The only tiny suggestion I would make is to change the “aren’t” to “are not” in the last sentence. Contractions have a way of tripping up folks (especially those who read fast); I read it twice since my first take was ‘are “priced in”‘ did not make sense (of course).

  11. The squeeze on non-essentials, including capital investment, will need to be managed very carefully in order to optimize delivery of essentials to the general population. As an example, consider maintenance of transportation infrastructure. If we try to continue maintaining a road system based on present use, or a mistaken understanding of future use, we will be diverting resources that should more properly go to other systems. As roads traffic declines, some roads will need to be abandoned and left totally unmaintained. The same principle will apply to the entire built environment of civilization.

    This necessity for triage (noted by pnwbuilder in his comment above) will pose many problems and will result in a lot of social conflict about who gets to maintain what. Since I have severe doubts about the ability of businesses and governments to execute the triage process well, I think that the deterioration in overall productivity (from wasting energy) will accelerate the smooth downward trends in prosperity shown in your charts. In fact, there will likely be many “tipping points” which result in large and rapid downward steps in prosperty.
    Production systems might be able to deal with the inconvenience of poorly maintained road surfaces, but when bridges fail or sections of the electrical grid fail, workarounds might be impossible. If so, resource conversion to essentials could be subject to precipitous declines.

    It’s far easier to manage the gradual building of a modern civilization than manage the crumbling of that civilization. Social conflict from the stresses produced by that crumbling will only add difficulty (by the definition of “essentials”, when the prosperity and essentials lines cross, people start to die). This is why the prosperity-curve’s downward slopes are likely to be much steeper than the upward (the Seneca Cliff). I therefore suspect your estimates of prosperity for 2040 will be more likely to happen by 2030 (and even this date assumes a generally war-free world economy).

    • From a closed bridge in my neighbourhood:

      “It is little consolation: at least the controls in Germany work so well that no one has yet been harmed by a collapsing bridge. The fact that there is nevertheless an acute danger is made clear by the example of the Rahmede viaduct on highway 45. It is so badly damaged that it has to be torn down and rebuilt. On Friday, the responsible federal highway company pulled the ripcord.

      The full closure of the Sauerland line near Lüdenscheid will drag on for several years. This is not only a disaster for the people in the region and the economy – South Westphalia is one of the strongest industrial locations in Germany. The closure will also have repercussions for the entire German highway system because traffic will have to be diverted widely to equally congested routes.”

    • these steel reinforced concrete infrastructure items don’t last very long do they, in Britain we have brick built railway viaducts that are still in service after 150 years, in parts of Southern Europe there are still functional Roman built aqueducts,
      the article you linked mentions other bridges in Germany built in the 1960’s and 1980’s, presumably built from concrete, in Britain we’ve already pulled down huge housing complexes that were built in the 1960’s,
      most of China’s new infrastructure built over the last couple of decades is concrete, apparently they poured more concrete in two decades than the concrete poured by humanity in the past, I expect it will all be falling apart before 60 years has passed,
      last summer I watched the flooding damage in Germany with horror, I wondered if they might manage to get most of it repaired in time for another round of extreme weather events this summer and see some or much of it washed away again,
      maintaining infrastructure in the face of a rising energy cost of energy and increasingly wild weather events is going to prove very challenging in the near future,
      just when the challenges facing us seem insurmountable, energy, climate, finance etc, we see a resurgence in enthusiasm for armed conflict and war,
      it’s a mad, mad world, isn’t it!

      this railway viaduct is near me, started in 1839, it’s quite impressive when you’re standing in front of it,

    • Working in the trades here in Canada all my life I’m aware that the industrial and commercial infrastructure has a life expectancy of about forty years, at that time it is due for a refit or allowed to decay to the point that demolition is the only option. We,ve had a few things go down here in the last few decades. An overpass in Quebec and a parking garage in Ontario come to quickly to mind.

  12. Thank you Dr Morgan, excellent and interesting analysis. One question what are the assumptions you use for the change in ECoE’s other the future periods?

  13. We have entered the Limits to Growth era and as it is a predicament there are no solutions, only worsening conditions. Green energy won’t scale up so humanity will scale down,way down.

  14. Tim, an excellent and sobering analysis. Looking at Figure D with it’s shrinking discretionary prosperity and the sheer speed of it, I cannot escape the feeling that something is going to break before 2040. Children of today will enter adulthood in a much harder world than anything their parents or grandparents would have known. They will feel poorer and with those in power unable to provide a satisfactory explanation, anger and resentment will grow. Where will the bread and circuses come from, when aggregate prosperity is a fraction of what it is now and maintenance costs are greater?

    • Indeed.

      SEEDS doesn’t predict black swans, so I get the graphs in the post.

      Arctic methane eruptions/releases will happen as surely as ice melts when warm, and wheat will not grow in dust or under water. It is a difficult dichotomy to wrap my head around.

      BAU until 2040?!? Ridiculous … and yet.

    • @ Sissyfuss, Pintada, and others,
      Those predicting the future of complex, open systems with certainty are wasting bandwidth. Recall Neils Bohr, Yogi Berra, and others: “Prediction is difficult, especially about the future.”

      Ever hear of unknown unknowns? Intervening variables? What we don’t know is infinite.

    • Mr. Kurtz said, “ Ever hear of unknown unknowns? Intervening variables? What we don’t know is infinite.”

      My dear Mr Kurtz, are you saying that you have FAITH that all will be well? (That is just a joke, I know that you are not a superstitious person.)

      When Dr. Morgan makes his predictions using SEEDS, he is making very well considered and astute forecasts based on his extensive knowledge of economics and modeling. I respect that effort, and his results. Unfortunately, he nor you are all knowing. We all have specialties. Yours is in investing, his in economics. Mine is science, and I am telling you that:
      1. AGW is exerting far reaching, undeniable effects right now. Those effects make it much harder to produce food, will render parts of the planet uninhabitable in this decade, and include feedback phenomena that are both dangerous and profound. There are billions of tons of methane clathrates that are less than 1 degree from their melting point. When the temperature of the water that covers them reaches their melting point, they will melt. That is a fact. It is knowable. It is documented. Don’t insult my intelligence or my knowledge in that regard.
      2. The mass extinction that we are watching happen is not just a cause of mourning for people – like me – who care deeply for the natural world. The extinction of those animals and plants mean that humanities existence is also in question.
      3. Our food supply is threatened not only by climate change. Food quality has been declining for some time, and the quantity of food is insufficient this year, and is also on the decline. What is the food price index? A new record high right?

      You don’t have to believe me. As I have explained in these pages – I don’t care anymore. I’m just answering your insult because I suspect that maybe, just maybe you are worth the time, and because the TV is boring at the moment. I mourn for our predicament every day, and because I do no socializing, I mourn in peace for the most part.

      After reading Dr Morgan for several years, I have a good understanding of his process and his conclusions. They represent a very reliable ceiling on humanities future. Things will certainly not be better than he predicts, and things will certainly be much much worse.

    • You are the one with faith, Pintada – faith in your ability to predict the future. You have praised my logic before on this blog. I made no ad hominem, but you have. Read what I wrote to Sissyfuss.

      I haven’t been in the investment game for 32 years. I was trained in analytic philosophy, and my positions as stated here are supported by seasoned physicists, biologists, and include Bill Rees, eminent system scientist and developer of the Ecological Footprint.

      If you would care to make a charitable wager on the timing of the end of human civilization, I’m ready to discuss it. Recall that Mr. Lewis refused my offer. Things will likely be very difficult for my grandsons. That is not what I’m arguing about. Predictions in a complex system are not easy, yet you and many others sound like the chaps on street corners with soap boxes and megaphones.
      This is about opinions, not insults.

    • I can relate an experience that occurred in your life:

      One day a friend came to you and said, “I’m gonna buy XYZ cause I think I will make a fortune.”
      You said, “No friend, don’t do it.” And then you listed reason after well considered reason that XYZ was a bad bet.
      Well, your friend bought it anyway, and he lost his shirt. Why did he do it? Because he didn’t recognize or respect your expertise.

      Have it your way.
      Peace. Out.

    • Pintada and Steve B K.

      You both seem to agree with eachother to me?

      What’s the “big beef” about? You both think that we are f***ed, but for slightly different reasons.🙂 End result will be the same though.

  15. Great article Dr Tim.

    The one nugget I took from it was how all the money sloshing around in offshore accounts etc, is all a bit of an illusion. If everyone were to spend all that money at the same time, there wouldn’t be enough “stuff” to spend it on!!!!!!!! It only holds “value” if the vast majority of it is never used/spent.🙂

    • Thanks John.

      The point you make is spot-on, and is why I talk about ‘money as claim’.

      We’re sometimes told, for instance, that we should use some form of QE to ‘fund’ transition to renewables.

      So we create $x trillion and spend it on solar, wind, EVs and so on.

      What then happens to the prices of steel, copper, cobalt, lithium and everything else needed for RE expansion?

    • Thinking about it, when people with money in the bank/investments etc, realise that a crash is coming, they will try and cash in their chips for something more “concrete”.

      A lot of that money will come flooding back into the economy and my guess, will get spent on property. Watch out for massive house price inflation. (That’s if it isn’t high enough already!!!!)
      Someone will be left holding the chips in the end and find out that they aren’t worth as much as they thought. A £ won’t be worth what it used to.

    • My own view is that property prices will fall as well.

      Property prices have been boosted recently by people looking to lock-in mortgages before rates rise (a bit daft to over-pay to do this).

      Affordability is over-stretched, and getting worse even before rates rise.

      B2L and B2L2T look extremely vulnerable, if tenants struggle and/or tourism slumps.

      Conversely, some – stress, “some” – stocks might offer value, especially as and when markets fall.

      Lots of people look at property as a ‘cash in when I need it’ asset, but markets can become illiquid if too many try to cash in.

    • “My own view is that property prices will fall as well.”

      This is a document produced by my Affordable Housing company Home@ix

      The Housing price bubble is a prime example of misallocation of credit leading to dysfunctional distribution of
      available resources. Energy intensity is one measure , before we even reach those questions there is much low-hanging fruit that will yield results that are beneficial to the overall economy in the Developed economies.
      Maurice Starkeys
      Utilising the Quantity Theory of Credit to
      Understand the Causes of the 2007 Financial Crisis provides a very good basis for moving onto Werners Disaggregated theory of credit.

      “This paper applies insights from Richard Werner’s publications to consider the causes of the financial
      crisis, and The Bank of England’s policy responses. It will begin by explaining some of the important
      elements associated with financial deregulation, and how these changes unleashed banks power to create new credit money. I will then use the Quantity Theory of Credit to explain the causes of the 2007 financial crisis. This will be followed by a consideration of the policies adopted by The Bank of England following
      the 2007 financial crisis, together with Richard Werner’s criticisms of those policies.”

  16. “we’re going to have to re-define what we mean by “essential”

    I guess that the re-defining will be under constant review. One by one, things will cross the divide from essential to discretionary. I wonder at what point the internet will cross the line.

    Where it stops will depend on how many people there are and what available energy renewables can provide.

    Food, shelter and clothing are the bottom line.

    • You are right, and these definitions have always changed. It wasn’t that long ago that both cars and televisions were regarded as luxuries. Now, in the West, they tend to be regarded as necessities.

      This applies to both aspects of “essentials”. I define these as (a) household necessities, and (b) public services provided by the state.

      It’s likely that we’ll have to redefine what we regard as “necessary”, and states will have to redefine what services they can afford to provide.

  17. Monsieur Kurtz, the 6th Mass Extinction is well underway and we can infer from the other 5 that it will be highly problematical. The science is settled if not your opinion.

    • Science is never absolutely settled, Sissyfuss. It is a process, subject to revision with new data. Note that “highly problematical” (your words) is not an absolute statement regarding the end of human civilization this century. I agree that biodiversity is in decline. This blog is about economics, not a needed decline in global human population to the 1 billion area, about which we likely agree.

  18. Perhaps it might help if I set out my two principles of forecasting.

    First, start with what we know about current and past trends, interpret them as effectively as you can, and make forecasts objectively.

    Second, be up-front about the limits to what forecasting can and cannot achieve.

    This article sets out forecasts on these principles. These are as objective as I can make them. These can never be more than best estimates based on what, I hope, are sound methods and unbiased application.

    There will, almost inevitably, be future twists that cannot be anticipated, by me or by anybody else. Some will, no doubt, say that I’m unduly pessimistic, and others that I’m unduly optimistic.

  19. Britain’s long consumer binge is ending – and the political fallout will be huge.
    Andy Beckett

    The cost-of-living crisis is a direct challenge to the kind of lives many of us have become accustomed to living.


    The Guardian do seem to be taking up the “post-growth” theme in their own inimitable politically motivated way with comments ranging from the inevitable collapse of capitalism, the wasteful and ecologically irrational nature of consumerism and the need for contraction and the notion that the current cost of living crisis will pass with the price mechanism rebalancing demand and supply.

    Personally I have not yet had contact with a single person who has been affected by the “cost of living crisis” other than hypothetical references to abstract numbers that are regularly quoted by the Progressive media who are themselves informed by Progressive think tanks.

    So it is difficult to say with any accuracy what the hell is really going on in the estimated 27.8 million households in the UK.

    Certainly in my political circles, the overriding issue isn’t economic but ecological. Not in terms of environmental degradation and climate change per se but more in terms of population ecology, agricultural land availability, per capita resource availability and the complex stratification between the “indigenous” and the “foreign”.

    These deeper socio-cultural ecological issues seem to be being played out in the form of a multidimensional Western culture war between Progressive elites and Conservative elites which in turn is leading to increasing levels of media sophistry and polarisation.

    Interestingly, politically both the Conservative and Progressive camps are trying to centripetally capture the centre but both are at the same time being pulled centrifugally to their orthodox left and right wing positions.

    I’m not sure how these political contortions will play out but my feeling is that the positive and the negative of an orthodox left and right will ressert itself leaving a vacant neutral centre to be filled with objective analysis, rational discussion and a deep sense of shared ecological responsibility.

    This might be reflected by a new movement of post growth rationalism or similar which might be supported by the increasing numbers of “don’t knows” who are increasingly frustrated by the dismal integrity of our current batch of mainstream politicians and increasingly frustrated by the dismal integrity of our current batch of mainstream media channels.

    • Steve G.

      Well written as your posts always are. My question is about the literacy and numeracy of the vast majority of the centrists you suggest might be more objective than the left and right. In the US, those with opinions on these matters are rarely centrists. They see themselves as allies with one wing or the other.

      Is the bulk of the British populace really well enough educated to address socio-economic affairs in a relatively objective fashion?

    • Hi Steven.

      It is just my feeling that there is a growing frustration with the current crop of mainstream politicians and the current crop of media channels which I am associating with an increasing share of don’t knows in the UK polls.

      But for sure this does not necessarily mean they will position themselves as centrists.

      My conjecture follows on from forums like this that are seeking a more objective approach which I rightly or wrongly frame as centrist since in my limited experience they tend to acknowledge the need for a mixed economy to navigate an uncertain future.

      In this respect, it is simply my inference that don’t knows have a mixed economy perspective and one which would prefer a more objective analysis to determine policy given the opportunity considering the extent to which mainstream politics and the mainstream media have entered into dirty politics.

      I see a neutral centre opening up because in the UK, although both main parties are trying to position themselves as centrist in their bid to capture the working class and the swing vote, they are simultaneously losing their core support.

      This may well end in a hung parliament which would benefit Progressives overall because the Progressive vote is split between Labour, the Libdems and the Greens. Thus as a coalition, they would have a working Parliamentary majority albeit no mandate to govern.

      This likelihood is forcing the Conservatives to shift rightwards to re-establish their core vote along with a commitment to Levelling Up and a commitment to rejecting Wokeism to bring along the white working class and ethnic minorities who believe more in meritocracy rather than diversity targets.

      If this strategy is successful, then the Progressive coalition loses its governing majority and Labour will need to attract the Libdem and Green vote along with a greater socialist emphasis to attract back the currently discontented Socialist left.

      This will open up the centre again and if economic conditions further deteriorate as forecasted here and the left shifts further left (to tax the rich) and the right shifts further right (to protect the rich) then this MAY open the door to a new post growth political movement that is ideologically free from the polarised gaslighting coming from the left and the right.

      All conjecture on my part based simply on my feelings and my limited understanding of UK politics.

    • Steve G

      Thanks. Too nuanced for me to grasp. I was more interested in educational capabilities (literacy and numeracy beyond grade 8 -age 14 or so- levels) Semi-literate people are an increasing % in the US as standardized testing has taken a back seat to a woke, feel-good philosophy. I think this began last century with laissez-faire parenting in the 60s. People without education are easily led by spin and sound bites. Look at the Trump followers who unknowingly voted against their best interests.

    • Steven.
      I’m presuming to be able to judge what is a relevant and sufficient post growth educational level across society requires knowing what is a rational post growth policy framework.

      For me it is one that is underpinned by balancing the books in order to put a brake on population growth. As I understand it, this is generally known as fiscal conservatism which I think most people understand. And if people don’t, then they probably know somebody that does.

      I am assuming that without growth there will be fiscal contraction whether people like it or not. So it then comes down to how a diminishing per capita pie is distributed.

      This to me is the basis of the multidimensional culture wars emerging across the West which I think are all proxies for post growth economic conditions.

      In a post growth environment, people are going to die and suffer. I don’t think generally people in the West accept that and so are trying to find ways to avoid that with their strategies of growth hopism with the increasing survival anxiety being projected as incompetence.

      In the Russian East, a more autocratic approach seems to be working and as I understand it, it is because they better understanding the causal link between pleasure and pain or in more ecological terms, the causal link between life and death, without it being overly confused and obfuscated by democratic sophistry.

      I don’t have any empirical evidence of that but I am minded to visit Russia to see how their planning is working out on the ground which as I understand it includes the re-establishment of dachas.

    • Steve Gwynne.

      There is a growing discontent in the UK but I’m not convinced that people really get what is at stake.
      Left and Right may drift further apart and allow space in the centre. But I know very few people who understand that growth is over.
      That those foreign holidays will have to stop.
      That they will have to give up the car.
      Not have heating etc.
      People are still looking to keep what they have, not to cut back. I don’t see lifestyle changes as being popular. Whether that is from the Left, Right or the environmental movement.

      In answer to your question Steve B K. I think plenty of people are capable of grasping the concepts of what is discussed here and elsewhere. It’s just that those stories aren’t being told in the MSM.

      For now at least.

    • I look at this from two perspectives. Economically, we in the West have entered de-growth which, politically, seems sure to change everything.

      Second, we’re nearing the end of the illusion that history ‘ended’ in the 1990s, with ‘liberalism’ (which can be defined in various ways) turning out to have ‘won’.

      What I see at the moment is incredible political ignorance about both of these factors.

    • Thanks John.

      It is quite remarkable to see the difference in Russia.

      Russia has amassed foreign exchange reserves of $635bn, the fifth highest in the world and rising. It has a national debt of 18pc of GDP, the sixth lowest in the world, and falling.

      The country has cleaned up the banking system and has a well-run floating currency that lets the economy roll with the punches.

      It has a budget surplus and does not rely on foreign investors to cover government spending. It has slashed its dependency on oil state revenues. The fiscal break-even cost of a barrel of oil fell to $52 last year, down from $115 before the invasion of Crimea in 2014.

      It is the paradox of Vladimir Putin’s tenure that he runs one of the most orthodox policy regimes on the planet. “The macroeconomic team at the central bank and the treasury are exemplary,” said Christopher Granville from TS Lombard.

      Mr Putin’s tight ship is a striking contrast to the prodigal socio-economic systems of the West, where money rains from helicopters and fiscal dominance prevails. “He is extremely conservative and rails against the dangers of debt,” said Chris Weafer from Macro-Advisory in Moscow.

      The commodity boom is adding an extra $10bn a month to Kremlin coffers from oil and gas. It is being squirrelled away in the National Wellbeing Fund.

      This rainy day reserve can be tapped as needed to cover social spending: pensions, child care, fertility bonuses for families, and mortgage subsidies for first-time buyers – components of Mr Putin’s levelling-up strategy for the 2020s.

      The Kremlin could sever all gas flows to Europe – 41pc of the EU’s supply – for two years or more without running into serious financial buffers.


      Would this seem like a country that has a rational post growth perspective?

    • Steve Gwynne.

      That’s all really interesting stuff about Russia.

      Maybe the West is keen for Russia to go to war with Ukraine so it uses up some of those reserves.

      Western sanctions don’t seem to have had too big an effect on Russia’s ability to function.

      Squeezing gas supplies to Europe/Germany looks like it will hurt Europe more than Russia in the short term.

    • Steve B K

      A follow on thought about you question about public literacy.

      There is a palpable sense of discontent in the air. People are feeling the squeeze and there are plenty of culprits out there as causes.
      Benefit scroungers.
      Ethnic minorities.
      Woke liberal elite.
      etc etc.

      Much of this stuff being peddled by the MSM and political parties.

      There is a sense that people want to return to the good olde times.

      “Make America Great Again”. “Take Back Control”.

      But the real reason is quite simple to understand.

      Oil is becoming harder to extract out of the ground.
      All the easy to get stuff has been had.
      The more we use, the more difficult it will be to replace.

      I think this is quite easy to understand (and the extrapolated consequences) it’s just that the MSM isn’t saying it. Better to pick a fight with Putin.

      There is lots of talk of the “cost of living crisis” but no real explanation of why energy prices are going up. There is vague talk of it being a post COVID thing. That supplies haven’t increased back to pre COVID levels as production was turned down due to a drop in demand.

    • Steve B Kurtz, you say “People without education are easily led by spin and sound bites” yet Ugo Bardi recently had a very provocative piece recently on propaganda, where he argued the exact opposite, hat the more educated the populace the easier it is to “salt the well” by feeding people misinformation. Propaganda as a phenomenon of intellectual and well-educated societies.

    • Simon,

      Apples and oranges. Ugo refers to a level of communication that the majority of US residents are incapable of comprehending. The spin and sound bites that I refer to are what got Trump elected, and what conspiracy theorists thrive on. I could find you links to ‘man/woman on the street’ interviews (US) which would leave you dumbfounded.

  20. This should help.

    Remember all that missing oil I wrote about last month? The discrepancy between where stockpiles ought to be (based on implied supply and demand balances) and the volumes that had actually been reported or measured?

    Well, those barrels are missing no more. As I feared, it turns out they’ve already been used up — in the refineries and petrochemicals plants of China and Saudi Arabia. That means oil balances are a lot tighter than the International Energy Agency previously thought.

  21. Art Berman on Nuclear, and a Plea for Realism
    All this argues, to me, for an “engineering” approach. Systematically examine everything we do with energy and either eliminate the “thing” or else figure out how to do it with more traditional sources of energy (e.g., sunshine to grow plants rather than natural gas).

    Traditional sources of energy tend to be of low density. To access a low density resource, it is necessary to have a low density human population. Yet, at least in my neck of the woods, we are currently piling more and more people into smaller and smaller spaces (e.g., apartment complexes rather than modest single family houses with garden space).

    Is food really in short supply? We throw away half of what we produce. It’s insane.
    Don Stewart
    PS. Old New England saying: Use it up. Wear it out. Make it do. Or do without.

    • Don, Art Berman is “a working petroleum geologistis – Oil and gas markets fascinate” him, as such his anti-nuclear rhetoric is an empty ” Plea for Realism” but sadly to be expected: Big Oil has been funding such propaganda campaigns continuously since the 1960s put together to denigrate nuclear energy to Big Oil’s direct benefit. In 1969 Robert O. Anderson, CEO and founder of Atlantic Richfield Oil, made a gift of $200,000 (half a million today) to David Brower to create Friends of the Earth, which became the leading voice internationally in creating opposition to nuclear energy and spreading inaccurate information about it.


      Here’s a better “Plea for Realism” based on physics.

    • @Natasha
      I fully understand the potential for conflict of interest. What makes his comments more persuasive to me is a conversation about 2 years ago with a nuclear expert from one of the national labs. He was quite despondent about the future of nuclear. It just didn’t pencil in. Besides some worries about losing his funding, he was also despondent about having wasted a good part of his life.

      That’s not proof, of course. But the fact that we have never built any significant number of commercially successful nuclear plants is indicative. Again, one can’t prove a negative. The Wright brothers proved some highly esteemed British scientists wrong.
      Don Stewart

    • @Don, Does your claim that: “the fact that we have never built any significant number of commercially successful nuclear plants” mean that nuclear electricity supply by France (70%), Finland (34%), Sweden (30%), South Korea (29%), US & Russia (20%), UK (15%) and world average increased to over the last 70 years (10%) are not “significant” or “commercially successful” (whatever that means within the energy supply domain which is a ‘Natural Monopoly’) ?

      Or that Macron’s declaration this month of a “Nuclear Renaissance” is also not “significant” and will not yield a “commercially successful” (however defined) outcome?

      Most evidence suggests that globally new nuclear electricity build out is increasing – on account of high energy density we can expect this to continue over the coming few decades:

      The IEA reports:- “Nuclear power increased in China (5%) and Russia (3%), with new units being commissioned during 2019 and 2020. In Belarus and the United Arab Emirates, the first nuclear units entered commercial operation, with more units currently under construction. Seven new reactors came online in the second half of 2020 and Q1 2021, more than offsetting the three reactors retired over the same period.”

      Also, notice Germany now emits more CO2 following unnecessary (foolish) early closures of otherwise working long term viable low CO2 (whole system) emissions nuclear electricity.



      And here’s an analysis of reasons behind unnecessarily expensive and long nuclear build times – almost always political & financial, rather than any implicit technological or short/ medium term materials and fuel (e.g. fast breeder) input limits:-

    • Thanks for the research Natasha. I must leave now for a couple of hours, but I’ll check the links later. As humans are addicted to exosomatic energy and attempted growth, simplicity will be involuntary in my opinion. As I’ve written before, nuclear is likely coming back…hopefully in safer ways.

    • “energyskeptic says:
      March 24, 2015 at 3:47 pm
      The main issues with nuclear reactors are their capital cost and long time to build, the odds are good that since they’re all ageing there will be more Fukushima’s and breakdowns, turning the public against their use, and above all, no where to store the waste. Plus nuclear is baseload power and doesn’t ramp or down quickly enough to match demand, which will bring on a blackout (no problem now but a big one when natural gas runs out). But that’s not the real issue – the real issue is that transportation depends nearly 100% on oil, and that transport that really matters, freight, runs on diesel fuel and their combustion engines can’t burn anything else, and coal and natural gas are near their peaks as well, and there isn’t enough biomass to make a significant amount of diesel from biomass. The thousands of suppliers for a nuclear generator won’t be able to ship, truck, fly, or send their components by rail to the building site, the workers won’t be able to get there without cars – civilization ends when transportation stops, especially trucks.” ?

    • @postkey, I answered *exactly* the same question from “James” in the comments to my recent essay here:-

      I am very familiar with Alice Friedemann’s writings, and have been a regular reader of her excellent blog for many years. I do not dispute her general conclusions, as is evident in my [RadixUK essay] concluding remarks:-

      “… high energy density nuclear technologies … Not in the slightest bit easy, with decommissioning being hard too. But not impossible.”


      a) “capital cost and long time to build” misses the point: all other alternatives are simply not buildable at significant scale at all. No matter how much time or finance you have. Further, capital costs are numbers in bank accounts. They never run out. So $£ can never be a serious limit, i.e. the only real limit to new $£ being created by government is what is for sale in the economy (see MMT). Thus if there’s not enough (minerals or other materials or high energy density fuel to power its all) they simply can’t be bought, no matter how much money there is.

      b) “nuclear is baseload power and doesn’t ramp or down quickly enough…” But this is not always the case. SMR’s (Small Modular Reactors) can be stacked together, and ramped up and down independently, to smooth load requirements. Nuclear electricity could be diverted to short term hydro storage or hydrogen / hydrocarbon synthesis or compressed air storage. Plus intermittent renewables could contribute to load balancing given a large enough grid. Indeed this is the basis of the nuclear industry’s ‘Harmony’ project partnering with renewables.

      c) “But that’s not the real issue – the real issue is that transportation depends nearly 100% on oil, and that transport that really matters…”

      Which is exactly my point: the same is true for wind, solar and hydro machines, except that less energy is returned by these diffuse renewables’ for a given quantity of all that oil burning. Plus renewables’ low grade intermittent energy that by definition relies on yet more oil burning to build and maintain backup storage.

      Given that oil is running out, what do we use this precious diminishing resource for? Something that is at least buildable and can scale-up to some extent, like nuclear power? Or something that’s not buildable and can’t ever scale-up like wind and solar and water energy flow harvesting machines?

      Alice Friedemann is a contributor to the Fan Initiative with very similar messages and aims: how are we going to “manage an orderly bio-physically imposed ‘de-growth’ thereby avoiding disorderly catastrophic collapse?”


    • Natasha.

      Unfortunately, the conclusion I have reached is that neither Renewables or Nuclear are able to replace the energy derived from fossil fuels.

      The question is not what tech can we install to maintain our ever increasing thirst for more energy, but rather, how do we function with much less energy.

      It’s a scary thought, but I don’t think there is a tech fix for our predicament.☹️

  22. Useful Reminder
    A tweet stream with 40 sage observations. I’ve heard most of them, but in the current trash dominant public discourse, it is well to be reminded. The chart of the Dunning Kruger effect is particularly relevant as we begin to see that energy is a real problem. Also the one talking about the difficulty of changing beliefs.

    Don Stewart

  23. Pingback: #222. The Forecast Project – Olduvai.ca

  24. For those of a certain age, or anyone trying to think about the impossible transition to Degrowth, I recommend Simon Fairlie’s memoir about growing up in 1950s Britain:
    I am almost 10 years older than Simon, so I have memories from the last months of WWII. While rationing reduced the amount of stuff everyone had, what I recall is a good life. My family did not have a car, nor did any of our neighbors. I walked downtown with a list of things to buy for my mother…unlike the delivery services Simon describes in 50s Britain. So while the details of adaptation will certainly vary, I see very little reason why it cannot, in principle, be done. The main obstacle is that, psychologically, happiness is meeting and exceeding expectations. Since I am a pessimist, I always expected the environment of my early childhood to come back again. I’ve been ready now for 81 years and holding. But since, today, everyone is promised “more of everything except having to actually do any work”, the reality is likely to fall short of expectations. I think the results will be bad, but I hope I am wrong.
    Don Stewart

    • I have similar fond memories of the 1950’s (I was born in 1948). My mother still has an Alpenrose milk box on her front porch (in which the delivery man put the full bottles and we put the empties). Of course, it hasn’t been used for milk delivery in decades but is used to stash items given to, and received from, neighbors. I walked to school, as did almost all other kids, from kindergarten on. Now, any parent who let their kid walk to elementary school by themselves would be arrested for child neglect. It was a different world back then (as every old person is always saying).

      But even though the post-WW2 era was perfectly fine, the problem with going back to that time is that it can’t be done. Every new level of technology is built on the foundation of older technologies, which are then gradually abandoned. Each new technology did things that the older ones couldn’t do, while still performing the services of the old technology.

      Many new technologies were developed to reduce human labor input (think switches replacing telephone operators) and to go back to the older technology would mean deliberately giving up automation and employing people to do things manually. No business could compete against others by employing more labor, abandoning modern equipment and spending capital to rebuild older equipment, all so it could provide fewer services or products at higher costs. Besides, even if company management was so foolish to attempt such a thing, where would it get the prior generation of technology and how could it be used in isolation? It might be possible to disconnect from the internet and go back to using fax machines, but even if you could find the fax machines to buy, who would you send a fax to?

      I used to work at a combined-cycle power plant that was operated by two people per shift. If that plant were to be operated without digital equipment it would have required dozens, perhaps hundreds, of people. It was tied to a grid that couldn’t even begin to operate manually. Just about everything is now computer controlled and there’s no going back.

      Technological ‘advance’ is a one way elevator. There’s no turning around and going back down gradually. It will just keep going until it can’t and then it will be a swift fall back down to earth. It will be a rapid technological simplification called “collapse” (and it won’t stop at the 1950’s).

    • Joe Clarkson.

      I agree.

      The 1950’s still used a lot of fossil fuels, relative to the 1700s for example.

      There is a long way to fall and it may be a cliff rather than a gentle grassy slope.

  25. Is the public getting restless?

    It is impossible to reconcile these sorts of videos with the words coming out of the mouths of people like Trudeau and various provincial governors.

    It is also interesting that John Campbell, in the UK, who has been a thorn in the side of the mainstream by presenting publicly available statistics plus a few interviews with front-line people regarding the progress and lack thereof in responding to Covid….just said that Omicron is the vaccine we should have developed. He bases that statement on data from the US that having an Omicron infection gives one the best immunity we have found thus far. And Omicron is not usually lethal for a healthy person.

    The New York Times features an article showing the rise of violence in the US over the last few years. More people are dying from car crashes despite working from home and less traffic. But aggressive driving is on the increase. There are many reports of increased dysfunctional behavior by school children. Child development experts want about missing critical developmental periods.

    Canada may be the establishment that gets overthrown by public revulsion? Or repression will redouble as the monied class gets worried?
    Don Stewart

    • I think you are over-emphasizing the Canada trucker’s protest as evidence of “public revulsion” toward Covid policies. The trucker’s protest will fade away faster than Extinction Rebellion did.

      I also follow John Campbell regularly. I think his recent episode(s) touting Omicron infection as the best option for combating Covid is poorly substantiated. While there is no doubt that a prior infection is slightly better than vaccination against poor outcomes after infection, Campbell has not presented any evidence that:

      1. Adverse events from vaccination are generally worse than those from infection with Omicron. This would have to be the main justification for promoting infection over vaccination and he has presented no evidence that this is the case.
      2. That it is easy to know who has been infected in the past, especially after antibody levels have declined significantly. It’s easy to know who has been vaccinated, but testing for T and B cell response is not very easy or cheap. Are we to take individual declarations of prior infection as sufficient to demonstrate immunity?
      3. Anyone knows how to manage the transmission rate of Omicron so as to optimize rapid spread through the population without overloading healthcare systems.
      4. Anyone knows how to balance non-pharmaceutical interventions with demographic risk. Which age groups continue to wear masks and which ones don’t? If you leave it to personal choice, would that be sufficient to keep hospitalizations low?
      5. It is better to wind down global vaccine production capability in favor of widespread Omicron infection. If it is decided that vaccines are no longer needed, vaccines will no longer be produced and vaccine supply chains will whither away. Campbell has presented no evidence that the next variant will be as mild as Omicron (how could he?). Wouldn’t it be better to wait a few years after the last variant appears before shutting down vaccine production capacity?
      6. He can reconcile his approach to vaccination against Covid with other vaccination programs, like those for the flu. Vaccination againt flu is far less effective than vaccination against Covid. Would he suggest abandoning flu vaccines too? Probably not.

      I have watched Campbell’s videos during the entire pandemic and think his analyses are often very good and informative. He may be right about giving up on Covid vaccination, but the evidence he has presented for doing so is far from sufficient.

    • @Joe Clarkson
      I was not trying to engage in a debate about what might have been done or what could still be done about Covid. And I don’t want to try to delve into why a bunch of mostly vaccinated truckers in Canada (or cops in Chicago) are willing to risk their jobs to protest against the “nanny state”. I’m just pointing out that quite a lot of people are fed up, and even the New York Times can now question orthodoxy. Luther nailed some theses on the wall and started a revolution. Debating whether the theses were correct or incorrect can occupy us, but the biggest fact was the revolution they triggered.
      Once people begin to question orthodoxy, where does it end? Brett Weinstein is fond of saying “whatever it was that the public health authorities did, it didn’t work”. That, of course, is heresy. But I see increasing numbers who agree with it. Some recent data indicate that, globally, young people are increasingly of the opinion that whatever their elders tried to do, it didn’t work.
      Don Stewart

    • “I was not trying to engage in a debate about what might have been done or what could still be done about Covid”.

      Thanks Don, and I’d like to remind everyone that we don’t “do” covid here. This because covid could easily drown out discussions about the economy, energy and finance, which (a) are important, and (b) are issues on which I think our discussions here can add value.

      Your point about Luther is important, and I’ve always thought that the Europe of his day was already primed for a revolt against orthodoxy – in other words, it wasn’t the merit of his theses that mattered so much as his symbolic act of defiance.

      It also seems to me that some governments – or, at least, some parties and some politicians – have invested a lot of political capital in promotion of the orthodox line during the crisis.

    • @ Don Stewart,

      OK, I get it. But I doubt that any country like Canada, the US or most European countries is anywhere near being “overthrown by public revulsion”, or because young people are begining to question orthodoxy (remember the 60’s?). Even countries like Hungary, Turkey or India, which have slide a long way toward repression, haven’t done so because the the monied class “got worried”. Cultural and religious issues are at the root of their repression and that’s likely to be the cause of the US slide into anti-democratic governance, too.

      But none of this will become really serious until the global market economy begins to fail and people in modern countries start to experience real deprivation. That’s when it will really hit the fan. This is still the tail end of the golden age of peace and prosperity. We should enjoy it while we can.

  26. Ugo Bardi’s latest covers the Covid pandemic, REPO market blowout and the continuing resource depletion:

    There is a cost to all this money printing – it is a continuing decline in prosperity. Wolf Richter recently wrote about the declining purchasing power of the US Dollar – something that is being replicated in the fiat money world. Meanwhile most of the gold has gone East…

    • Steven.
      I’m presuming to be able to judge what is a relevant and sufficient post growth educational level across society requires knowing what is a rational post growth policy framework.

      For me it is one that is underpinned by balancing the books in order to put a brake on population growth. As I understand it, this is generally known as fiscal conservatism which I think most people understand. And if people don’t, then they probably know somebody that does.

      I am assuming that without growth there will be fiscal contraction whether people like it or not. So it then comes down to how a diminishing per capita pie is distributed.

      This to me is the basis of the multidimensional culture wars emerging across the West which I think are all proxies for post growth economic conditions.

      In a post growth environment, people are going to die and suffer. I don’t think generally people in the West accept that and so are trying to find ways to avoid that with their strategies of growth hopism with the increasing survival anxiety being projected as incompetence.

      In the Russian East, a more autocratic approach seems to be working and as I understand it, it is because they better understanding the causal link between pleasure and pain or in more ecological terms, the causal link between life and death, without it being overly confused and obfuscated by democratic sophistry.

      I don’t have any empirical evidence of that but I am minded to visit Russia to see how their planning is working out on the ground which as I understand it includes the re-establishment of dachas.

  27. Tim & all,

    A nationalization of a private industry is being discussed in Chile. They have had a good quality of life there compared to most countries in S.A. Nationalization has been discussed here regarding necessities in economies.



    A former Chilean Socialist minister considers “delirious” the nationalization of mining industry

    Wednesday, February 16th 2022 – 09:44 UTC

    A veteran Chilean politician who among other appointments was Minister of Mines under the deposed Socialist government of Salvador Allende in 1973, and later held other ministerial responsibilities following the return of democracy in 1990, strongly criticized the initiative to again nationalize the mining companies which operate in Chile, as proposed in the Constitutional Convention drafting a new constitution.

    • Thanks Steve –

      This article does mention one of the significant barriers to nationalization: The breakdown of long term international contracts. For this reason, I predict that nationalization will either lag, or run instep, with general de-globalization. I don’t think it’s likely to be a front-running issue, but rather a desperate response.

      I’d venture we see nationalization for domestic consumption before we see nationalization for products which will still be exported. This is hard when the complexities of foreign reserves (especially USD needs) is factored in.

      Some commodities, such as copper in Chile, are hard to imagine Chile using 100% of their production. Other items, such as agricultural products, fertilizer, and fossil fuels may be different.

    • Theblondebeast

      There will always be an export market for all that Chilean copper regardless of whether the resource is nationalised or not.
      It may disrupt the supply to the western economies (the reason for the coupe in 73) but China could easily consume what is produced.
      I’m sure the C.I.A will be watching things closely in it’s “own back yard”.

  28. Uncle Sam wasn’t too keen on Salvador Allende nationalising the mines back in 1973 either.
    Democracy only works if it gives out the result the US wants. Far better/easier to have a dictator in your pocket.

  29. @Natasha
    Re: the accusation of corruption by David Brower, here is a response by Rex Weyler, a Canadian physicist who was a co-founder of Greenpeace:

    This, in my experience, is historical revisionism used to argue the erroneous theory that opposition to nuclear power was primarily a pro-oil “propaganda campaign.”

    There may well have been pro-oil interests that wanted to limit nuclear power growth, but such interests were not historically the driving force or “leading voice” in opposition to nuclear power.

    David Brower was part of the anti-nuclear-power movement even when he was till with the Sierra Club, which he left to form the more activist Friends of the Earth, which he would have achieved with or without Robert Anderson’s contribution. And in any case, Brower was not necessarily the leading voice in the anti-nuclear power (& weapons) movement.

    The leading voices in the anti-nuclear movement were more accurately: Dr. Ernest Sternglass in Pennsylvania after Three-Mile Island, leukaemia specialist Dr. Helen Caldicott, Ralph Nader, Henry Kendall at MIT, radiation scientist Rosalie Bertell, Dr. John Gorman, Nobel laureate George Wald, and Sam Lovejoy from the Clamshell Alliance. None of these efforts have any link to petroleum industries.

    In the 1950s, there was a lot of opposition to nuclear testing in the atmosphere, because of the dangers of radiation detected from the US Desert Rock (1950) and Plumbbob tests (1957), the Russian Totskoye tests in 1954, and the Bikini Atoll tests. At that time Barry Commoner, a doctor in St. Louis, did some studies on children’s teeth, and discovered that most children in the late 1950s had traces of Strontium-90 in their teeth. The only sources of strontium-90 were the atmospheric nuclear tests. The rise in childhood leukemia was linked partially to radioactivity in the atmosphere, driving Dr. Helen Caldicott and others to oppose uranium mining and nuclear power, as well as nuclear weapons.

    The first planned US nuclear plant was scheduled for Bodega Bay, California in the 1950s, but the plan was scrapped due to local resistance, especially since it was near the San Andreas Fault. David Brower and the Sierra Club were active in this citizen protest. No link to any petroleum interests.

    The Windscale nuclear fire in the UK sparked the British anti-nuclear power movement and shifted the UK Campaign for Nuclear Disarmament to protest nuclear power as well as nuclear weapons. Also in the 1950s: The Kyshtym nuclear radiation leak in Russia, Mailuu-Suu radioactive tailings spill in Kyrgyzstan, and a meltdown at the Santa Susana nuclear lab in California inspired anti-nuclear movements in Europe, Russia, Japan, and in the western hemisphere. In 1959, the Bulletin of the Atomic Scientists began to campaign against nuclear power as well as weapons, to stop the US Atomic Energy Commission plan to dump radioactive waste in the ocean off Boston harbour. They stopped this plan. No links in any of this to an oil propaganda campaign.

    A planned power plant in Wyhl, Germany in 1971 sparked massive public resistance that forced the government to cancel the plan. This inspired other movements in Europe including the 1977 protests against a nuclear plant in Bilbao, Spain, led by Basque citizens. The Three Mile Island melt down in Pennsylvania in 1979 was the main event that boosted the anti-nuclear power movement in the US and Canada. Chernobyl was a massive source of anti-nuclear power sentiment worldwide, as was Fukushima.

    Following Three Mile Island, Sam Lovejoy and friends toppled a tower at the proposed Seabrook Station Nuclear Power Plant in New Hampshire, inspiring the Clamshell Alliance on the East coast and the Abalone Alliance on the west coast, in opposition to the Diablo Canyon Nuclear Power Plant.

    So, I would say, the story under consideration is just plainly, historically inaccurate, and appears more as a smear campaign to make it appear that anti-nuclear sentiment is a tool of the petroleum industry, which it clearly is not.

    For me personally, when I was a physics student in the 1960s, I believed nuclear power had a great future. I changed my view over time as I became more aware of radiation dangers and many of the incidents cited above.


    • @Steven B Kurtz, Thank you. But Greenpeace founder, Rex Weyler builds a ‘straw man’ (in the piece you kindly copied above): “[…] that opposition to nuclear power was primarily a pro-oil “propaganda campaign”. But this was never claimed. Rather the evidence suggests that Big Oil evidently played a non zero role (not a primary role) in setting up opposition to nuclear electricity. (Also whether David Brower is, or was corrupt, is beside the point).

      Further, Weyler repeats the same tired old ‘hymn-sheet’ themes fraudulently corrupting otherwise justified objections to nuclear weapons as reason to be anti-nuclear electricity generation too. Such standard ‘bad faith’ dialogue is unsurprising coming from a co-founder of Greenpeace (FYI I’m a former member).

      Do we hear Greenpeace complaining about how Germany is now on course to yet further increase its CO2 emissions, following its unnecessary (foolish) early closures of otherwise working long term viable low CO2 (whole system) emissions nuclear electricity?



      Chernobyl is now ‘Europe’s Largest Wildlife Refuge’. Visitors to the 30 kilometre radius exclusion zone will get more radiation from the flight they take to get to a guided tour. According to biologists, far from a nuclear wasteland, the exclusion zone has become a sanctuary for flora and fauna – precisely because people were forced to flee. National Geographic: “30 Years After Chernobyl, Nature Is Thriving.” The BBC report: “The Chernobyl exclusion zone is arguable a nature reserve.”




      Anecdotal evidence suggests that women who stayed in the exclusion zone have generally outlived their neighbours who stayed away, “happiness” — or relative happiness, anyway — is a key reason why. About 100 people live there now, the last remnants of more than 1,000 mostly older women who moved back into the exclusion zone in the weeks and months after the disaster.

      Estimates of direct deaths related to radiation exposure from nuclear energy top out at around 4,000 from Chernobyl, and 1 from Fukushima. Indirect deaths related to the evacuation at Fukushima range from 573 to 2,202, so the highest estimate of nuclear energy’s total death toll sits at around 6,200. This is a remarkably positive record given that nuclear energy has been in use for over 70 years.

      (Chernobyl was an early Generation II military reactor based on 1950s RBMK Soviet technology, designed for optimized for speed of production over redundancy. The combination of graphite moderator and water coolant is found in no other power reactors in the world).

      Up until 2010, I too sang the same hymns as Greenpeace, FoE etc… being steeped in CND etc… since the ’60s. Then I decided to do my own thinking after meeting the author of this study (a mathematical economist) who found [global 2012] average deaths / million GWhr: Coal 170,000; Oil 36,000; Biofuel/Biomass 24,000; Natural Gas 4,000; Hydro 1,400; Solar rooftop 440; Wind 150; Chernobyl (total direct deaths) 47; Nuclear (commercial power plants only) rest of the world 0; Nuclear worst case future estimates 90.

      Click to access mathsnuclearumass2o13oooo1o.pdf

      No matter how many individual ‘scientists’ Rex Weyler and Greenpeace parade (nine above) science works by assessing evidence in aggregate not echoing ‘cherry-picked’ ideology down the decades. Greenpeace appear to be an ‘anti-scientific’ political misguided lobby group, guilty of misattribution and manipulation (e.g. nuclear weapons atmospheric testing as reason to be against the lowest mortality and CO2 emissions of all other energy sources), rendering their conclusions at best useless. More accurately, their lobbying today amounts to the hypocrisy of blindly condoning hidden and rising CO2 emissions increases in Germany.

    • Natasha

      How many nuclear power stations are required to replace present total global energy demands if fossil fuels are made redundant or run out? How quickly can they be made and how much uranium will they need?

      Even if we go totally Nuke, we won’t produce the energy our hungry global economy requires.☹️

    • @John Adams asks: “How many nuclear power stations are required to replace present total global energy demands…”

      John, I do not advocate that it is possible to replace *all* fossil fuels (c86% of global *energy* supply) with nuclear (c4% of global *energy* supply = c10% of global *electricity* supply) for two fundamental reasons (which like many here, I am sure you are very well aware of):

      a) electricity can’t replace fossil derived process heat – crucial for a third or more of global output (upon which much of the remaining two thirds rely on); and
      b) primary input (build-out) material limits including uranium – even the super abundant dissolved in seawater at c3ppb supply – all rely on secondary fossil fuel inputs to mine, refine & transport i.e. you can’t build nuclear power plants without fossil fuels. (A nuclear powered synfuel route to a tiny part of fossil fuel replacement, even if thermodynamically possible, would be a massive multi-decade long undertaking).

      So yes I agree, certain, rapid, likely chaotic global de-growth *is* “a scary thought” nonetheless my main point is that nuclear electricity has significantly greater capability of scaling up (using current rectors, and in future SMRs, Gen IV & Fast Breeders) to replace a greater portion of current fossil fuel applications, in a shorter period of time, compared to all other alternatives (i.e. ‘Modern Re-newables’ which, can’t scale beyond their current current c3% global *energy* supply due to their very low energy density) – including fusion, despite it being only 30 years away!

    • Fossil fuel induced air pollution kills millions of people every year and damages the health of all of us. Even if every nuclear reactor on the planet melted down with poor containment, the pollution released would be less harmful than 1 year of fossil fuel air pollution. And we do this to ourselves every single year. Few people really care. Opposition to nuclear power due to its ‘risks’ is not a logical position. And it never has been. Even if the world met its energy needs from a vast fleet of RBMK (Chernobyl) reactors, we would still be safer than we would be burning fossil fuels and pouring the effluent into the atmosphere we all have to breath. But this is about ideology not logic.

      Fossil fuel depletion may eventually kill billions of people. A large reduction in oil and gas supply will translate into less diesel to work the fields and less fertiliser to feed the soil. There is no way that can happen without comparable declines in food production. Less food means fewer people. Population is growing fastest in places where people are poorest. For population to decline rapidly due to an absence of food, implies unprecedented levels of human suffering.

      Nuclear reactors do not produce electricity, they produce heat. They are often presented as being complex and high-tech, but really they are simple. Just pieces of uranium arranged in the right geometry with cooling channels between them. Boilers that use nuclear heat instead of natural gas. The power plants attached to them produce electricity. We could build reactors to supply district heating systems. We could build reactors that produce hydrogen using thermochemical processes. We could use reactors to power ships. Or we could use reactors to make electricity, power transportation with electricity and free up residual oil and gas for other uses.

      These things won’t happen because nuclear power has been loaded with huge amounts of unnecessary complexity, thanks to four decades of poor and incompetent regulation and political idiocy. It now takes so long and costs so much to build them, that they have become impractical. Back in the early 1970s, nuclear reactors cost $500-1000/kWe in modern money and they took 3-5 years to build. In China, they still cost around $2000/kWe even with all the added complexity of modern systems. In Europe or US, we pay $10,000/kWe and it takes 20 years, half of an average career, to build a reactor. No technology is so good that it cannot be ruined by idiot politicians. Maybe the impending apocalypse will force sensibility into the western world? I don’t hold my breath. The western world is controlled by people traditionally recognised as enemies of civilisation. It is now a sick and perverse place where the evil punish the innocent.

    • Tony,

      I guess you don’t recall that I’ve been pro-nuclear (as a substitute for FFs when possible) ever since I joined this blog. James Lovelock has been as well. I’ve been a population activist for over 3 decades (Sisyphean). We’ve doubled in 40 years, tripled in my 76, quadrupled in my mother’s 97. That is biological plague phase.

      Biodiversity loss (incl. pollinators), aquifer depletion, surface water and soil toxification,…are major concerns. Bill Rees, developer of the Ecological Footprint, agrees with me that climate along with the above are symptoms of overshoot. Rex Weyler agrees as well. Alice Friedemann too, and they are all on a list I co-own.

      I posted Rex’s comments as counterpoint to blaming big oil for all the anti-nuclear protests decades ago.

  30. https://www.resilience.org/stories/2022-02-16/a-case-study-of-fossil-fuel-depletion/

    An extensive study of Alberta, Canada, oil and gas production and the grim outlook for the future. Tons of data and mathematical modeling.

    “In the end, the most certain thing we can say about the future is that it will involve less energy from fossil fuels. The rest of the story has yet to be written.”

    Note that tar sands production is dependent on natural gas produced from conventional wells.

    Don Stewart

    • Another Important Facet
      “Studies of EROI tend to confirm the low-hanging fruit principle. Looking at the EROI of US oil discovery, Megan Guilford and colleagues estimate that in 1919, oil companies discovered about 1200 barrels of oil for every barrel they put into searching for new reserves. By 2007, that value had fallen drastically: 1 barrel of oil returned a discovery of only 5 barrels.”

      So…now, in the US, the MARGINAL energy cost of energy is 20 percent….not the 10 percent (in round numbers) shown in SEEDS. If I understand it correctly, SEEDS is an accounting type number, but not an incremental number. Those who have studied economics will remember that there is a vast literature showing that incremental numbers are what drive many economic phenomena. Thus, the price one has to pay for a house depends not on the average price competitors for the house are willing to pay, but the HIGHEST price any competitor is willing to pay. The mirror image is that the cost of new wells to replace the 13 percent per year depletion rate in Alberta is now 20 percent of the new oil produced.

      It seems to me that this indicates, at least for Alberta conventional oil and gas, that the most relevant number is the 20 percent energy cost of an incremental barrel. Most of us probably thing that at that cost level, civilization as we have known it cannot exist. While it is possible to think of other civilizations which might flourish with 20 percent ECOE oil, they would behave quite differently from the one we live in. I will also add that defining “cost” is always highly dependent on the boundary conditions. For example, in Alberta is the “cost” of cleaning up the depleted well accounted for? On paper “yes”, but in the the Realpolitik of Alberta the answer is “no”. And if we then appliqué on that the thermodynamics of turning a barrel of oil into useful work, we run into the limitations of heat engines, and the need for infrastructure with which to build and use those heat engines. Which is how the Hills thermodynamic model indicated that incremental production is now not feasible.

      From a financial perspective, if incremental production is not feasible, then a capitalist model of growth becomes infeasible. I will leave Canadians to work out the feasibility of politics and civil life in Alberta.

      Don Stewart
      PS. As I recall, Art Berman has said that the annual depletion rate for shale oil and gas in the US is 30 percent. So worse than the Alberta wells at 13 percent.

    • Hi Don,
      It would seem that in the forthcoming planned Energy Transformation. Peak Oil Demand is likely going to be the driving factor and not peak oil supply or indeed a collapse of Oil Supply.
      ““If peak oil demand surprises consensus by occurring much later, Aramco will benefit from higher market share and more spare capacity to mitigate another unwelcome price boom,” said Bob McNally, founder of Rapidan Energy Group.
      https://www.reuters.com/article/us-saudi-aramco-strategare very different measures y-insight-idUSKBN26R3PA
      The Prices of Oil particularly but also Gas and Coal are not market-determined and investment decisions are also not in response to market price discovery mechanisms. Production costs and fiscal break-even costs .

      This short documentary from the excellent Wendover production is well worth watching on Saudi Arabia’s Oil Problem

      Stranded Carbon assets are I think a far more likely conundrum facing the collateralized money supply and the unit of currency being tied to a physical and falsifiable energy metric rather than the Abstractions that are currently dominant

      The Energy transformation is not I think the greatest challenge to world commerce it is the new reserve currency measure
      particularly in a multi-polar world rather than the uni polar post-Soviet collapse from 1990-2018.

      I would argue that the urgency of finding a strategic soft power replacement for the fading Washington Consensus petrodollar hegemon based upon a Dollar/Special Drawing rights Carbon credit standard linked to renewable production

      Russia , Saudi and China will all have rather a lot to say about the Unit of exchange for international trade and embedded carbon metrics will become increasingly important whilst calculating carbon trade balances in international trading relationships.

      At this point the distinction between where we have been, where we are now and where we might be headed is what makes Tims article and its central point so interesting and important.

      “In principle, the process of interpretation has to move forwards from the past to evaluate financial risk, but backwards from the present to create the preconditions for effective forecasting.”

      Click to access pdf-generation-foundation-stranded-carbon-assets-v1.pdf

      We should be carefully looking at where we are investing our money. (1)
      (1)ED. This is the key misunderstanding, the whole basis of this analysis should look at Net Energy Surplus over cost of energy extraction, then in a real sense the Sentance, “We should be carefully looking at where we are investing our Energy ( qua, Energy )”, would have an energy-based monetary unit taking the place of the Debt-based monetary unit as a referent, the debt-based monetary unit as a referent renders the statement meaningless a per pro-energy capital allocation decisions.
      drtimmorgan on July 14, 2019 at 11:11 am said:
      Please note:

      Rather than presenting the economic case for transition to renewables as a report, I’ve decided to set it out here as an article.

      It is, in my opinion, by far the most important issue on any agenda. For as long as we allow considerations of financial “cost” to limit our transition to renewables, we don’t just risk environmental disaster, but condemn the economy to impoverishment, as the ECoE cost of fossil fuels rises.

      At a later date this might be turned into a downloadable report, and a stats annex might posted here too.

      Meanwhile, I hope you’ll feel inclined to debate this with as many people as you can.

    • @Roger Lewis
      I have written, but they are not yet posted, articles suggesting that if the information from Alberta is correct, and the study saying that it now takes one barrel of oil to cumulatively produce 5 barrels of oil is correct, then we are into a sort of Export Land Model where the exporting countries hoard their oil just to keep what they have in operation. The importing countries will be cannibalizing what they have to try to keep some semblance of their economy working. The big threat is nuclear war. In other words, the clock has already chimed midnight…we are still coasting and don’t realize what has happened.
      Don Stewart

    • Hi Don,
      I will read the links as they appear with interest.
      The dynamics are obviously complex and Oil is a hard energy act to follow
      Your points on marginal production in some cases I do not doubt, yet I also think the dynamics are rather different in the Giant FIelds, and Stranded Carbon Assets should that scenario come to pass would mean that Tim’s task of making forecasts is not an easy one even with all parties pulling in the same direction, that they are certainly not doing so makes forecasting an impossible task.
      An open honest dialogue is the best way to cover all the bases and let’s hope that Carbon assets do occur due to being made redundant by technological progress.

    • Roger Lewis.

      I’m not sure that there will be a peak oil demand first.

      Renewables haven’t really made a dent in oil demand. Renewables suppliment oil and are not replacing it. The developing world’s thirst for energy will not be met by renewables. Oil will still be king until the EcoE bites hard.

    • Hello John,
      I do not claim to know one way or the other John.
      It seems to me that renewables supply will rule the Credit creation roost though and will profoundly
      affect the access to all energy via Carbon credits.
      The Transition from Oil should peak oil supply occur during the FInancial transition to Carbon Credits could
      have impacts on the smooth running of economies as determined by access to Energy and the form of Money required to access available energy.
      The Oil equation is quite difficult enough even before one gets into the Gas, Coal, and Nuclear part of the Energy Portfolio available across the stratified scales of different economies at different stages of development.
      My own opinion is that the Financial system tail is still wagging the Energy supply dog, as with the famous Elephant of Hindustan even the Tail is subject to different interpretations.

  31. Lacy Hunt and Michael Green acknowledging the transformative nature of fossil fuels, for the first time I’ve heard them do so.

  32. Export Land Model Redux
    If my comment on marginal vs. average gets posted, and if it is anywhere near correct, then the proposed attempt in Chile to nationalize certain natural resources takes center stage. Somebody whose name I have forgotten proposed the Export Land Model perhaps 15 years ago. The idea was that oil exporting countries would only export what they didn’t “need” in their own country. If that happens, then a very few countries will be exporting oil, and if the marginal analysis is correct, they are going to need most of what they produce to keep their own oil-dependent economy alive…and forget about growth.

    Which leaves the oil importing countries with no options except cannibalizing what already exists in a desperate attempt to keep the infrastructure working. Forget about “renewables”.

    The systemic risk, of course, is that the oil importing countries are stuffed full of nuclear weapons. Even Pakistan can bring on a global Nuclear Winter. A Martian observing the events on Earth would likely short human survival….if Martians are given to gambling.

    Don Stewart

    • Such Ruminations invite us to examine the potential response in the West:

      It doesn’t look promising, does it? I happened to watch Trudeau under attack by an interviewer discussing his conflict of interest and his previous violation of Canada’s Code of Ethics, and then attack in the parliament. His incoherence in both was astounding. Not that I would want to put either Trump or Biden in to replace him.

      I do notice that the Canadians, who have been particularly hostile to the Russians are always eager to blame Russia. It’s possible Russia provided a match, but the kindling is all home-grown. And the West has been adept at lighting any available kindling in Russia and adjoining countries.

      Don Stewart

  33. Natasha and Tony.

    I guess what I’m saying is that nuclear isn’t a solution with or without all the talk of radiation/safety etc.

    The reactors can’t be made without fossil fuels. We could perhaps use the remaining fossil fuels to create a new generation of reactors, but that will only buy us 40 years. (That would see me “over the line”) but the generation after that would need to be made with energy sources other than fossil fuels. (ECoE will prevent fossil fuels being used to any useful level by then)

    Electrification of all things that are presently using fossil fuels is probably impossible.

    (I’m still uncomfortable about creating all that radioactive waste for future generations to deal with (without them having any of the benefits))

    This ebook is the best analysis of the energy options open to us, that I have ever read.


    • More from Tom Murphy

      After much rumination, and conversation with other thoughtful people, Tom has concluded that at the base of our multitude of problems is the notion that humans are the apex of creation…not just a minor part of creation with an outsized power to kill.

      I suggest that the reason we desperately cling to ideas such as saving the world with nuclear is that we identify “world” as a handful of relatively rich people who look a lot like us. If we look at energy, it turns out that around the turn of the 20th century, a man’s horse ate 100 times the food that the man ate. Even to someone who works on fusion, that ratio must strike thoughtful people as absurd. And so we continue to pursue energy, when what we evolved to use was the energy from food we hunted or gathered and fibers from plants and animals and the water from springs, all accessed with some pretty simple hand tools and some basic notions such as leverage.

      Whether there is any prospect that this playbook might change, I really have no definitive answer. I think circumstances will force change, but we may choose, like Hitler in the bunker, to go down in flames.

      Don Stewart

    • Hi Don and John Adams.,
      Murphy has a particular viewpoint, earlier last month you cited a joint paper by Tim Garret with Steve Keen was linked to in the Comments here at SEEDS. Identification of a 50-year scaling relating current global energy
      demands to historically cumulative economic production
      Timothy J. Garrett1,*, Matheus R. Grasselli2
      , and Stephen Keen3

      What is apparent is an inconsistency in Starting points, starting assumptions, and also objectives. A job for integral analysis if ever there was one.
      Keens Book The New economics: a manifesto, was positively reviewed by Simon and Nitschler, with the following proviso as to where next?

      Click to access 20211200_bn_steve_keen_the_new_economics_wpcasp.pdf

      “…politics, sociology, anthropology, psychology, international relations and other aspects of society affect
      the economy. But these effects, whether supportive or distortive, are assumed external to the
      economy proper. And this assumption is pivotal. Although the effects of these so-called external
      factors alter economic outcomes, they leave the economic categories themselves intact. And this
      bifurcation, we argue, is the Achilles’ heel of all economic theories, orthodox and heterodox,
      old and new.
      In our view, capitalism is not an economic system, but a conflictual mode of power. Those
      who rule this mode of power – its dominant capitalists, politicians, mainstream academics,
      opinion makers and the various organizations they control – make every effort to conceal its
      power features. This is why neoclassical economics, beholden to its masters, can never be a
      science. But the problem besieges every and any economic theory that keeps power external to
      its basic categories. In our opinion, it is only when the study of capitalism substitutes for the
      narrow understanding of its economy that power can assume centre stage to reveal what economics is structured to conceal.”

      In the Garret and keen paper. it is stated.
      “The half-century for which this fixed ratio held covers two thirds of historical growth in energy demands, so assuming its persistence, the implication is that society is not in fact decoupling from resource needs.”

      John Adams referred me to the Murphy book in this comment https://surplusenergyeconomics.wordpress.com/2022/02/02/221-strategies-for-a-post-growth-economy/comment-page-1/#comment-28890

      I did reply but my comment didn’t make it past the filter. Here it is again.

      I have read through the Book.
      I will read it in more detail. It certainly has a great framework to base a scientific discussion around.
      Without hot air by The Late prof. Sir David MacKay is well worth a read its easily findable online. For the less mathematically minded Davids’s book would certainly make a good primer for the Murphy book.
      Regarding the shape of and timescale over which an Energy Transformation will take place
      There are of course challenges if one has to adhere to an Urgent timescale.
      My view is that there is no urgency and those particularly invested in the Urgency narratives tend to be
      more closed-minded as to what potential replacement energy sources can take up the slack where other staple energy sources are unable to meet the demands of the future human requirements.

      I find the insights of Shimshon Bichler and Jonathan Nitzan on Capital as Power very compelling their work on Oil price and differential accumulation offers a fascinating perspective on the actualities of oil supply over conjectures of peak oil and EROI of petro carbons.
      Economic actions that create artificial scarcity
      Cartels, monopolies and/or rentier capitalism

    • @Rogerglewis
      Not to get too far off in the weeds in terms of reductionism and Total Integrated Strategies (to channel Parkinson and his laws), but yesterday Art Berman tweeted about Richard Heinberg’s book Power, which takes a very broad view of the term. So much for the demonizing of Berman as being ONLY a tool of the oil industry.
      Don Stewart

  34. Perhaps I am being Utopian but the free market would take care of this and allocate resources where they need to be.
    Here in the UK where I think almost all coal electricity plants have shutdown over the last 10 years or so where they were around 30% of the national grid before this would not have happened in a free market.
    I don’t want to get into the elites dystopian plan to control all resources which is why they want all this green agenda pushed through but there needs to be more awareness of the problems of green energy such as wind which does not seem to be economically viable especially compared to fossil fuels.
    It seems to me that it would be a good start by the government permitting a free market in our energy supply by allowing any type of electricity plant to form and compete with any other already in operation.
    I think it would also be sensible to change the law and permit only a 5% tax on all electricity generating companies to make it more profitable for the companies and encourage capital allocation to this space.
    Britain is supposed to have a lot of coal that could potentially last us (UK) in our energy needs for a long time.
    Opening up the mines again would give us the opportunity to start many coal generating plants so avoiding the need to import it. An important aspect as coal is expensive to transport.
    Again this could be encouraged by only putting a 5% tax on all mining companies to encourage the production.
    This could also be extended to a maximum 5% tax on all mining workers income tax so the companies could pay less wages to employees thus maximising profitability whilst also helping the workers earn a good living.
    Karl Denninger gives an interesting example of how coal can potentially play a major role in helping economies that are heavily reliant on oil here:
    Until we get off this road of central planning my presumption is governments will just exacerbate the problem.

    • Hi Carl David.

      I read somewhere back along that the available coal deposits in the UK had be revised down.
      Yes there is lots of coal down in the ground still, but the seams are too thin and it is too difficult to get to. So the ECoE is too high for it to be meaningful source of energy going forward.

    • Carl.

      I think the “free market” is just a myth.

      I’m not convinced that the free market will “allocate resources where they need to be.”

      Rising energy costs will keep the dividends for shareholders rolling in but other people will have to make the choice between heating and eating.

    • Stephen,
      Like you I have great difficulty in understanding the paper.
      However, I think they are way behind the curve. In the ‘new world’ where blockchain and Bitcoin are the foundations of any decentralised economy the use of the word ‘control’ and ‘austerity’ should be irrelevant .

      I wonder if you or any others on this forum are aware of the economic developments in El Salvador .
      It appears they have spooked the USA central bankers and the IMF . El Salvador is moving away from dependence on the dollar to Bitcoin and using their volcanic energy for the mining operations.
      Lots of excellent YouTube discussions on this and other Bitcoin developments.

    • Maybe the next energy crisis strapline will be “the choice between mining, heating or eating”, Jomelco.

      Hardin is part of a wave of America’s “zombie” fossil fuel plants that have been brought back from the dead by cryptocurrency companies looking to feed the insatiable energy demands of their mining operations. China, formerly the epicenter of the bitcoin industry, effectively banished around half of the world’s currency miners last year and the resulting search for cheap power has seen companies eye struggling US power stations.


    • I await the day when the US bans crypto mining as the energy is required for essentials. I despise the whole sector. As bad as fiat. Money should be calorie backed!

  35. This is the most succinct description of the energy-finance-economic system I’ve ever read. Unpacking all of it would be an excellent semester’s study for those to whom these concepts are new. This essay is truly illuminating on multiple levels. Congratulations, Tim Morgan for a great service performed for humanity.

    • As a long-time admirer of your work, I am deeply honoured by your support and commendation.

      Ideally, there would indeed be study of these concepts, and an international organization, politically neutral, supplying this information to everyone.

    • Hi Charles,

      I’ve followed your work for maybe five years, and Tim’s for around half that time. You both are top educators, thinkers, and researchers. Thanks for your efforts.

    • I find Tim amd Charles’ work invaluable in making sense of our otherwise bewildering world,

      my hope is, one day, to see an alternative Davos forum and an alternative COP gathering to promote alternative views to the current mainstream dogma,

      I’d be delighted if both Tim and Charles were interested in participating in such projects.

    • Personally speaking, there are a lot of questions around what to do now.

      This project started out with a lot of ‘I want to know’ questions, with SEEDS built on ‘the Everest principle’ of ‘to see if it can be done’. I’ve always remained, so far as possible, neutral and objective.

      This raises two questions.

      First, what more can I/we reasonably expect to accomplish?

      It’s really for others to judge, but I think we’ve developed an effective method of interpretation, arguably a lot better than the conventional (not a high bar, admittedly, given the deficiencies in orthodox interpretation of the economy).

      Second, how far is neutrality tenable, and how strictly should neutrality be applied?

      We’re watching terrible mistakes being made, to the detriment of “the many” and, odd though this might sound, not to the lasting benefit of “the few”.

    • I’m satisfied with the validity of the SEEDS model, it strikes me that it ought to be used as a litmus test on any economic proposals made,
      for broad acceptance neutrality is important, judgements ought to be made on economic proposals based on their feasability, if it adds up it makes it to the next stage, if it doesn’t add up it should be dismissed as unworkable,

      “Once you eliminate the impossible, whatever remains, no matter how improbable, must be the truth.” – Sherlock Holmes”

      we’ve reached a point where only practicality counts, as you’ve observed before; we can no longer afford the luxury of ideology,
      a new ideology ought to be emergent, that which can be realistically done ought to be considered a viable idea.

      frankly, we’ve few options left at this stage, it makes sense to follow the path of least resistance towards an outcome which is becoming increasingly inevitable.
      we can go willingly or be dragged kicking and screaming by circumstances beyond our control.

    • Neutrality is critical – I’ve always believed that, and always will.

      This article reaches conclusions that comparatively few will like, but so be it. Within an extremely polarised debate about our economic future, “continuity” is impossible, whilst “collapse”, though eminently plausible, isn’t proven, for so long as orderly decline remains at least theoretically possible.

      I’ve never been one for conspiracy theories, but even some grand conspiracy, if it did exist, would amount to ‘a plan’, of sorts, even if few of us liked it.

      What I think we’re seeing is more clueless than conspiratorial. Panic should worry us, especially when some decision-makers are casting around, in increasing desperation, for something – anything – that will prop up the status quo.

    • I think it’s quite possible to be neutral, or at least trans ideological, where you give all ideologies credit where credit due but favour none,
      the real difficulty is the current cancel culture, to me it seems a method to neutralise or shut down any discussion of alternatives,
      what the left doesn’t like they label fascism, what the right doesn’t like they label communism, accusations of racism, sexism or anti-semetism etc. are used to discredit people and shut down discussion that could lead off the neo-liberal reservation,

      I think Corbyn made a fatal error apologising for virtually non existent anti-semitism, he should of laughed it off as a baseless accusation and stuck to the programme he wished to discuss,

      I was fascinated by the Channel 4 interview with Jordan Peterson, it was a trap where the intention was to denounce him as a sexist or somesuch and cancel his influence, I thought he handled it superbly, it must have been a gruelling experience for him but he took the wind out of his attacker,

      I try to be neutral and put forward rational compromises that try to accomodate all perspectives, when I’m being attacked by all sides I feel as though I’m right over the target, going to the place no one wants to go, the only place left to go!

      I think the current media storm in the West, constantly accusing Russia of being about to invade the Ukraine, is a massive distraction,
      it’s an attempt to make rapproachment with Russia impossible, unthinkable, the whole issue could be settled in one phonecall if Washington was prepared to eat a little crow and make the security concessions requested, but they are simply too stubborn to even consider it.

      the secret of effective diplomacy is putting yourself into your opponents shoes and appreciating their perspective, you empathise and then negotiate with that in mind, it works in geo-politics, national politics, business relationships and even human relationships,

      now isn’t a healthy time to poke ones head above the parapet, you’re assured of taking fire from all directions, it seems futile, but if you can do it as a neutral and objective observer without being drawn into a slanging match, you can set an example, one that no one will acknowledge openly but others might secretly decide to emulate!

      I’ve been reading about the Chartists, they were strongly and sometimes violently opposed by the establishment but in time all but one point made in their Peoples Charter was adopted by the mainstream.

      change in Britain has always been a slow and painful experience.

    • “What I think we’re seeing is more clueless than conspiratorial. Panic should worry us, especially when some decision-makers are casting around, in increasing desperation, for something – anything – that will prop up the status quo.”
      “War”, the bigger the better.

    • ‘Neutrality is critical – I’ve always believed that, and always will.

      This article reaches conclusions that comparatively few will like, but so be it. Within an extremely polarised debate about our economic future, “continuity” is impossible, whilst “collapse”, though eminently plausible, isn’t proven, for so long as orderly decline remains at least theoretically possible.

      I’ve never been one for conspiracy theories, but even some grand conspiracy, if it did exist, would amount to ‘a plan’, of sorts, even if few of us liked it.’
      Tim, agreed. I am going to make more of an effort from now on to avoid contaminating technical energy debates with polarising political content. It ends up detracting from the important tenets of the core subject. It is about focus and self discipline, I guess. Things I need to be better at.

      Collapse, which I have heard described as a rapid and uncontrolled reduction in social complexity and human numbers, is possible. It would happen if resource shortages caused critical systems to fail. Things like food supply and distribution. The ability of money to serve as a medium of exchange. The decline of cash may make money less resilient, by forcing reliance in electronic systems that could fail when power supply is interrupted. The failure of road distribution of goods due to a sudden discontinuity in the availability of liquid fuels. Collapse could occur due to political tensions caused by resource shortages leading to wars. The Maya collapse was faster than it otherwise would have been, because of wars between rival cities over remaining crop land. Conflict between the UK and EU, leading to trade dispute, may be an example of a feedback effect that worsens the impact of declining net energy.

      We can perhaps consider society as being analogous to the human body. Like the human body, a nation grows using the resources at its disposal and certain systems grow up around those resources. Those systems have huge embodied energy and are not easy to change. Rather like a human body, a nation can survive for a while with a tightening supply of energy. But beyond minimum limits, its critical systems begin to fail and collapse ensues rapidly, reinforced by positive feedback effects. It is difficult to predict exactly where those critical points will be for any society, because human societies are complex systems. But if transport infrastructure begins to fail due to disrepair; electricity supply becomes unreliable, or a significant subset of population is deprived of sufficient food, or if long vanquished diseases start making a comeback; the risk of collapse would appear to increase dramatically.

    • ‘I think Corbyn made a fatal error apologising for virtually non existent anti-semitism, he should of laughed it off as a baseless accusation and stuck to the programme he wished to discuss’

      Trying to keep this as neutral as possible, whilst conveying the important historical facts. It was a power struggle between two competing factions for leadership. One faction (Corbynites) drew support from traditional trade unions and was essentially the traditional British Labour movement. The other faction (Blairites) drew support from the new international business elite, essentially Jewish businessmen centred around Lord Levy. They had a more globalist and commercialist outlook than traditional Labour; a large amount of money that they were prepared to make available to Blair in exchange for control of government policy. Peter Mandelson was put in place as their eyes and ears and right hand man at the heart of the cabinet. And they dominated ownership and the journalist ranks of the British media. The euphoria around the 1997 New Labour election was essentially manufactured by these media interests in exchange for Blair’s complete cooperation on government policy.

      The more recent antisemitism scandal was about deposing the traditionalist Corbynites and returning the Blairites to control of the party. The Blairites had previously been heavily discredited by both their involvement in the Iraq war and the economic liberalism that led to 2008 financial crash. There are other places where you can learn more about both groups of people and what they stand for. I make no judgement here about the morality of either side. But we should be able to present historical facts without controversy.

      All political parties have subdivisions, essentially parties within parties. Different subdivisions are ascendant at different times and often dirty tricks are used by one group against the others. Often they represent very different outlooks, different political interests and produce different results. The Tories have their 1922 committee. At one time there was a distinct hypercommercialist Thatcherism sect. The Tories also contain pro-European sects, at one time centred around Kenneth Clarke. The American Republicans have their tea party and neocons. These people believe in American ascendancy. Other Republican sects are very traditionalist and believe life should be driven by protestant values. The old BNP in Britain was divided between the Griffinites and Tyndalites. Often, divisions centre around the different outlooks of past and present leaders. Sometimes, they represent very specific interest groups, with their own funding routes and values that may even conflict with the traditional values of the party. The Blairites probably could not have risen to ascendancy, without the privatisation of nationalised industry by the Tories and the global asset stripping of British industry through the City of London. This weakened the traditional funding routes for the party and opened the opportunity for more commercialist interests to assume dominance over the party. By 1993, the traditional Labour movement had been weakened to the point that it was no longer a viable route to power. Jeremy Corbyn was popular amongst the party insiders and traditional left, but obviously, the bulk of the British media sympathised with his rivals. Ultimately, he was unable to overcome this obstacle and the Blair it’s engineered the scandal that removed him, with the expert help of their entrenched interests in the media. Make of this what you will.

      I am curious to see what direction Peak Oil will impose on British institutions. The European withdrawal has shifted power balance as well. Political direction will also be influenced by who happens to be in the White House. Chinese money introduces another competing factor.

    • Tony H. You’re not going to like this response from a Kew Gardens resident and longtime Londoner. He is a voluntary simplicity practitioner, and was raised Protestant.

      To suggest Labour didn’t have a severe anti-Semitism problem under Corbyn is demonstrably untrue.

      The comment itself reeks of latent anti-Semitism too, “…The other faction (Blairites) drew support from the new international business elite, essentially Jewish businessmen centred around Lord Levy…” What?! Blair was guided by a cabal of international Jewish businessmen? Conspiratorial nonsense.

      There’s a lot one could criticise Blair for, but the fact remains his economic policies were extremely popular with the British people. If it hadn’t been for the Iraq invasion (and opening the immigration floodgates), he’d be the most popular Labour Prime Minister ever.

      The commenter seems to be a hard-leftist who dislikes free market economics, de-nationalisation and capitalism, so labels it “neoconservatism” and he also seem bitter at the fact that the people of Britain soundly rejected the hard left, and has contrived this daft explanation as to why.

      Blair, Blairites and Blairism, can’t possibly be described as a “neoconservatism”. He was a Keynesian – Blair (and later Brown) emptied Britain’s coffers by throwing money at public services, particularly the NHS.

    • Steve, your commentator may have access to information that I do not. I am trying to present the situation as it was described to me by a party insider. I am not passing judgement on either side. I don’t much care for either of them or any other political party. My friend’s father was a figure in Welsh Labour. This is essentially his take on Tony Blair’s rise to power; Corbyn’s fall and Starmer’s ascendancy. He despises both Blair and Starmer with passion. He regarded Thatcher as the right hand of the devil. He initially expected Blair to reverse privatisation and reopen the Welsh mines. When it didn’t happen, he ultimately became disillusioned with the party. When Corbyn took control of the party, he was viewed as a hero and saviour. It wouldn’t surprise me in the least if there was indeed a lot of antisemitic sentiment in the party. My friend’s father certainly does have a chip on his shoulder. Probably a whole potato, to be frank. But I have no reason to doubt his version of events. I present it here as historical account provided by an eye witness. Make of it what you wish.

    • My only quibble with SEEDS is that it isn’t peer reviewed, or else independently verified in some way.
      Partly because Tim doesn’t want anybody and everybody to have access to the deeper knowledge in his system (I would probably feel the same myself!) and partly because, who would be the peers doing the reviewing?!
      The physics we study in the last year at high school (i.e. prior to university) is sufficient to understand the energy side. A project like SEEDS is more suited to someone with knowledge of macroeconomics than it is to a physicist.
      No one else has, to our knowledge, attempted anything remotely like this, and I sincerely believe that the creator of SEEDS will ultimately be seen as the progenitor of a science which supersedes what is presently called “economics”, with due regard to Charles Hall who originated EROIE, and others who followed him.

      Like Matt, I am satisfied with the validity of the model. It explains a number of things consistently and it doesn’t contradict anything in my world view.

    • The GDP deflator can be calculated by comparing nominal GDP with real GDP, giving an index series, and an annual rate of change in that index.

      RRCI is calculated similarly, but by comparing nominal GDP with real prosperity, again providing an index series and annual rates of change.

  36. Today it is reported that the websites in UK which recommend energy deals to enquirers are being closed since there is now no ‘profit’ in there operation. ( there existence in the first place was always a puzzle to me. All part of the Ponzi scheme called the ‘energy market’ .)
    More call centre jobs on the scrap heap.
    Further descent into degrowth.

  37. @ John Adams.

    I am not in a position to know of your understanding of “free market economics” but I will try to explain myself a little better as I don’t think I was explicit in my first post due to already using many words.

    It’s obviously a detailed subject involving everything such as currency, banking and all business/economic activity but I will stay on course and just relate it to the energy market here in my country of residence (UK).

    Currently, heavy subsidies have been awarded to wind farm manufacturers and producers in the market along with solar. We also have subsidies towards smart meters and heat pumps too.

    In a free market businesses allocate resources towards the most profitable avenue. In all probability no investment or business would have gone towards wind farms or very little compared to what has been used and invested so far. They clearly are inferior and high risk compared to fossil fuels.

    More capital would have likely gone towards nuclear, coal & gas plants etc. Whichever would have made sense to the entrepreneurs in this field of operation.

    However, due to government intervention giving handouts capital gets diverted towards avenues they would not have gone otherwise. This exacerbates the problem.

    Left alone to its own devices electricity producing businesses with free competition would be in a constant battle to lower their costs and become more and more efficient due to necessity.

    If not some other company would out-compete them and take away their business.

    The UK has a semi-monopoly in the energy market that is over regulated, over taxed and price caps also to add insult to injury.

    No entrepreneur in his or her right mind would even consider trying to start an electricity generating company.

    The free market is not a myth. Along with the division of labour it is one of the key reasons if not the most important reason for the high standard of living the west has experienced over the last 200 to 300 years starting from the industrial revolution.

    The US and Britain would be in serfdom already without it. It’s why the rest of the world like China don’t have the freedoms we do as they have never had a free market.

    There is much work that shows the importance of free markets and how they work.

    Milton Friedman, Friedrich Hayek, Von Mises to name a few have shown the importance of how the free movement of capital and labour ensures our freedoms as well as ensuring the efficiency of our society.

    Is it perfect? No. But it has clearly shown that it is the most efficient system mankind has ever had and nothing else ever tried even comes close.

    As it currently stands, as Mr Hayek’s book title aptly states we are on the road to serfdom.

    Hope this helps.

    • @ Carl D, While I agree about the positive points, you’ve neglected the unavoidable negative effects of unfettered profit seeking activities. These are known as externalities, and include the emission and dumping of pollutants into the commons, noise and light pollution, and the use of finite resources with little regard for future generations. Efficiency is not the sole barometer of a successful system. Sustainability must be considered as well.

  38. @ Steven Kurtz.

    Valid points made.

    I did state it wasn’t perfect.

    In relation to sustainability, do you want the precious resources we have remaining to be wasted?

    Because the road we are currently on is doing just that. When you have government intervention the wastage increases in proportion to the amount of intervention as a general rule. Perhaps not precisely but you get the idea. Charles Hugh Smith has brilliantly shown this himself via the flooding of currency into the economy and via globalisation etc.

    Jim Rogers book “Investment Biker” is an excellent read that helps to understand the inefficiencies and wastage that occurs in economies where free market principles are not adhered to.

    Regardless of what system we use there is always going to be issues of pollution etc.

    I think the best way to address this is to encourage companies to cause less pollution via taxation.

    For example, 20% tax for high polluters and 5% taxation for more cleaner emission businesses in the same industry etc.

    That is a crude example and it would obviously need more consultation on the subject by people more smarter than I am but that would be an approach that could work although the percentages may be different along with a few other aspects.

    Do you want future generations to have lesser freedoms than we do now? To be told where they can go and what they can do and how much energy they can use etc?

    That is the model in store for the general world population assuming we do not go down the free market path.

    The global elite have already decided the world is overpopulated and their policies are to ensure they maintain their power whilst everyone else is subjected to misery from poverty etc.

    The free market economy ensures the fewest victims and the most winners.

    If there is a better system or model I have yet to see it and the current path we are on is definitely not for the better of mankind in general.

    • @ Carl David

      Re “Do you want future generations to have lesser freedoms than we do now? To be told where they can go and what they can do and how much energy they can use etc?

      SK: given the 400% population increase in the lifespan of living individuals, and 1000% increase in energy-matter throughput, scarcity is guaranteed to squeeze p. capita well-being. Central control is guaranteed to increase as grids. water, sewer, distribution, food…are in brittle condition.

      “That is the model in store for the general world population assuming we do not go down the free market path.”

      SK: Free market cannot make chicken salad out of chicken manure. Nor get water or energy out of stone.

      “The global elite have already decided the world is overpopulated and their policies are to ensure they maintain their power…”

      SK: Science says humans are in plague phase. No judgment is involved. Hierarchy is a given in social mammals, and the best human societies can do is manage it. Some do ok like Scandinavia, Canada, AU/NZ. Most struggle.

  39. @ Steven Kurtz.

    Your point of view is acknowledged.

    We are clearly in disagreement on the matter.

    My thoughts on where we are heading are not illusory. Central planning will increase unfortunately.

    In the end nature will probably be victorious and an equilibrium will be reached on Mother Earth with or without mankind’s blessing.

    • I agree with both points: central planning will likely increase (until/unless major systems breakdown), and nature will put plague species back into balance with habitat (as inadequate resources and other negative feedback increase)

      So, I don’t know what we disagree about! I’ve been a free market advocate for half a century, but I also hold to common good constraints based upon science. Competition is good for economic creativity and inventiveness. However, in a species in massive overshoot, not constraining breeding and pollution is suicidal. Nature’s way to rebalance is more painful than central planning in that regard.

    • Having looked at economic forecasting in this article, I’m planning to address broader issues, including government, in a later piece. For now, though:

      Adam Smith, regarded as the prime source on free market principles, stressed that markets will not stay free or fair if left to their own devices, and effective markets require constant vigilance to prevent monopoly, oligopoly and malpractice. In other words, regulation is a pre-condition for the functioning market economy.

      The market economy requires that, whilst success is rewarded, failure is punished. If your investments are wise, you profit – if they are unwise, or you are the victim of bad luck, you lose.

      In this sense, the market economy was abandoned in 2008-09, when the authorities intervened to ensure that recklessness was rewarded, and prudence was punished.

      Furthermore, the capitalist system absolutely requires that the owners of capital earn real (above inflation) returns on their capital. This, too, has ceased to be the case since 2008-09.

      We do not, therefore, have a market economy or a capitalist system today. The question thus becomes, not ‘can we preserve the market economy?’, but ‘can we reinstate it?’

    • Carl David and freemarketthinker.

      I think Dr Tim’s post above, sums up my take on the “free market”.

      It has never been a “free market”. There are rules and regulations that help some and hinder others. e.g UK water companies allowed to pump raw sewage into rivers and seas. Banks that are “too big to fail”.

      The energy market in the UK is a farce. Companies can offer cheap tariffs for some because others are paying more than they should on the “Standard Tariff”.
      How about nationalising the whole sector and set up a not-for-profit energy company with a mandate to supply energy at close to “costs” as possible to its customers?

      All the Utilities are natural monopolies. The idea that there is a “market” is a con.

      How much economic activity would actually be profitable if the manufacturers/polluters had to incorporate environment clean-ups on their balance sheets rather than “externalising” them?

      Private railways franchises in the UK get government subsidies.

      There is no way that the private sector is going to create all the nuclear that you think we need Carl. The up-front costs can not be met by the private sector. Only State subsidies can build nuclear plants.

      Same goes for the National Grid.

      I’m afraid that State control is here to stay and increase and our personal freedoms will have to be curtailed. We are heading for a “war footing” with shortages and rationing.

      The “good days” are over

    • Carl.

      Just to add. All the infrastructure that the privatised energy, Railway, Water companies inherited when privatised, was create by The State.

      They got it for free. There is no way that the infrastructure, when it needs replacing, will be paid for by those private companies.

  40. A Few Thoughts Triggered by Yesterday’s Reading
    (Note: I get ideas from other people. I don’t usually come up with blinding insights on my own.)
    *Some bank put out the message that we are now in the age of scarce molecules (by which they mean tradable raw materials)
    *This article points out the life-giving advantages of being out in the sunshine and in a forest:

    It’s a long video, packed with information. For a summary page with 3 suggestions, go to the last couple of minutes. The recommendation is to revert back to many of the habits of bygone times.
    (From Charles Smith’s weekly roundup.)
    *My observation is that the molecules made by the natural world are also in short supply to most moderns living in the industrialized world. We are warehousing people… not letting them soak up the sun in a forest glade. And hypnotizing them with screens.
    *We might think of the “molecules of geology delivered by fossil fuels and the capitalist economy” but also “the molecules of life delivered by a simple lifestyle”.
    *I suggest that an economic system which relies on the thermodynamic destruction of the molecules of geology and which destroys our exposure to the molecules of life is not worth saving.
    *As suggested in Genesis, it is possible for humans to tend the garden of biology. But hammering it with poisons is not the way to do it.
    *A female columnist, surveying the wreckage, opined that “it is time to get off the grid”
    Don Stewart

  41. I’m a bit late joining the debate on this particular article, but I think it’s worth posting this snippet regarding the unfolding energy crisis.

    There’s a report on Bloomberg today (Bloomberg TV and on-line news) about ongoing power shortages in Sri-Lanka. The causes are multiple, but what caught my eye was the fact that the state owned oil company has run out of cash to pay for fuel. Apparently there are two shipments of fuel for generators sitting offshore, but no dollars to pay for it. The dollar shortage is also being linked to fears of a sovereign default.


    The nation is experiencing rolling blackouts. Anyone who has read Richard Duncan’s spine chilling work, might recall that he envisions an increase in rolling blackouts as a leading indicator for the terminal decline of industrial society. If things turn out for the worse in Ukraine, it might not be too long before parts of Europe experience the lights going out for a time.

  42. There is nothing magic about fossil fuels that uniquely enables us to build stuff with them, other than their high EROI. We can make steel using electric furnaces and electrolysis derived hydrogen to reduce iron oxides. We can make concrete using electrolysis derived hydrogen to heat the kilns instead of natural gas. It will be more expensive, but the high power density of nuclear systems may make it affordable. It will be much tougher to make renewable energy infrastructure this way, because 20-100 times more steel and concrete are needed per MWh. The already low EROI combines with inefficiencies in the process to make it difficult to produce net energy if we had to make wind turbines out of steel produced using hydrogen from wind turbines. But there is no reason to suppose it won’t work for power-dense equipment like nuclear power reactors. We already produce aluminium using electricity. Whilst we probably cannot use wind turbines to make wind turbines, we almost certainly can use nuclear reactors to build nuclear reactors.

    One way of mitigating the poor EROI of renewable energy is to use lower embodied energy materials and simpler systems. In times past, we built windmills using stone towers (which lasted centuries) and wooden blades. All energy cheap materials. Today we could do the same. We would apply modern technology to blade design, gear design and use carbon steel for gears. To further reduce embodied energy, we could also use mechanical power to directly power equipment or put hydraulic pumps in nacelle casings instead of generators. If we could match demand to supply, rather than the other way around, we further improve EROI.

    • You’re right, in theory, but regardless of the source of primary energy, a great deal of new infrastructure will need to be built, especially if we try to preserve modernity. If we electrify everything, we need to build tremendous amounts of generation and transmission equipment, plus replacements for all the space heating and industrial heat equipment that now uses fossil fuels. If we go straight to synfuels to help replicate the benefits of oil and gas, we still need the new electrical generation equipment and very large numbers of synfuel plants to replace the fossil fuels we now extract from the earth.

      In either case, the bulk of the energy to build all that infrastructure will have to initially come from fossil fuels. As the new energy infrastructure is gradually built out, the energy coming from fossil fuels will taper to zero. But where is this extra energy for new infrastructure going to come from? If we greatly increase the extraction of fossil fuels (if that is even possible) we destroy the climate even faster. If we ration energy throughout the present world economy to free up enough to build the new energy system, we crash the existing economy. A transition to a new energy system must be done gradually over many decades so as to reduce the amount of new energy required and it’s best done when there is an ample surplus of energy from the prior energy system (in our case fossil fuels). This is the essence of the “energy trap” that Tom Murphy described so well over a decade ago. The trap was sprung decades ago and it’s almost impossible to get out. It’s far too late for a Green New Deal or a transition to nuclear. Don’t even mention fusion.

      So, it’s now just about impossible to transition to a new energy system. And even if we marshalled the worldwide political will to do a transition from existing energy supplies, presumably even as those are being rapidly reduced to combat climate change (think of the energy rationing involved), we still have several other major aspects of overshoot to worry about, like water supplies, species extinctions / general ecosystem destruction, and supply of critical minerals like the phosphorus needed for agriculture. Ample energy makes everything easier, but it’s not the only marker of sustainability.

      We’re in a great deal of human population overshoot and the predicament of overshoot is only resolved one way. I suggest it is better to get it over with as soon as possible to save as much of the natural world as possible. We should therefore welcome a dramatic economic collapse happening soon. Fortunately, there are plenty of auspicious indicators of collapse right now and they will multiply rapidly as time goes on. Get ready for it. A wood-powered world with far few people is coming soon.

    • @Joe Clarkson ….
      You seem to be one of the very few who understand the ongoing situation. The answer to declining net energy cannot be “let’s build a civilization scaled ……….” (fill in the gap with nuclear, solar, wind, wave energy, geothermal, fusion or zero point energy).
      The amount of energy needed to build anything of scale, while maintaining existing world infrastructure, and improving infrastructure in developing countries, just doesn’t add up.

      As an example of lack of system thinking, a future based on solar energy. Current thinking on the EROEI is around 15 – 20 to 1, based on energy used in construction from publications like the following …

      The sort of numbers used are probably way too low as the promoters of anything tend to be, but lets use the ~3700kwh number in construction of 1 Kw of solar polycrystalline panels (note not the extra infrastructure!). Over 25 years at 4 hrs/d this would produce 36,500 Kwh of electricity, which is less than 10/1 return on energy invested, but promoters always stretch life to 30+ years, add more hours etc to get to the 15- 20/1 ratio.

      What everyone fails to mention is that the above initial energy is based on fossil fuels providing the mining, heat processes and transport of all aspects of production of the solar panels.
      If we use electricity as the source of energy in their construction, we will have to make the hydrogen and synthetic fuels first. At best using 20% efficiency for conversion of solar power to hydrogen and synthetic fuels, the energy cost of manufacturing solar panels goes up to 3700 Kwh X 5 = 18,500 Kwh to produce 1 Kw of polycrystalline panels, so the EROEI falls to 2.

      There is nowhere near enough energy to run a modern civilization on EROEI of 2!! It’s only as high as 2 by leaving out all the energy needed to make the electrolizers, hydrogen tanks, huge facilities to capture carbon out of atmosphere for the synthetic fuel production etc, etc.

      So even if we go all out to produce a “renewable” powered civilization from solar ( and the same would apply to all other wishful thinking alternatives to FFs), it is a one time deal by using remaining fossil fuels to extend current civilization a few decades, while trashing the environment in the process..

      People believe in religions with a passion en masse, so nothing to stop the belief in a ‘renewable future’ at current civilization levels despite the evidence of numbers and reality. We are deep in overshoot with no way out, like yeast in a bucket of grape juice…

  43. @ DrTimMorgan

    Correct. People are blaming capitalism for our current ills when in reality we don’t have capitalism anymore.
    We have government intervention in combination with capitalism. The system has become very complex and subsequently very fragile in the process.
    2008-09 was probably the years where major policy decisions significantly took us away from free market principles.
    We had “free trade deals” and high tariffs along with other policies prior to 08-09 which permitted monopolies and encouraged globalization.

    QE and artificial interest rates (centrally controlled) have also made a mess of many markets including the stock market, housing market and the very high inflation we are all now experiencing.

    In my opinion, we need to try and make more people educated on free market economics so it becomes part of the narrative.

    If the general population are educated on the matter then it would force politicians to make policies that do not involve more intervention and central planning. This is the only way I see of trying to help reverse the course we are on.

    As it stands generally people are expecting handouts and more intervention as they think this actually helps them.

    I am seeing it here in the UK with the energy markets which are getting increased from April 2022 significantly.

    They are blaming greedy energy companies etc. If we did not have price caps and the market was not intervened by the government we wouldn’t have a shortage of energy as we would not have closed down any of the coal plants and also would have had more plants of different types coming online by now.

    Granted, we wouldn’t have mega cheap energy but we would be in a far better position than we would be in currently.

    The UK government is putting more fuel on the fire by giving subsidies to households with a council tax band of between A-D of £200, I think.

    This is supposed to compensate for the increase in bills. You can’t make it up.

  44. I tend to think the best we can collectively do is outline a realistic pathway to degrowth that focuses on reducing waste and friction–much of which is generated by the maximization of self-interest / profit–as well as on localizing /decentralizing capital, agency and the production of essentials. Many of the commenters here are engineers or adherents to this mindset, and so the great attraction of magical thinking may be difficult to grasp. Between magical thinking and the Void, people will choose magical thinking.

    So we need to explain how we can improve general well-being by reducing consumption. Unfortunately, the entire economic governance and financial systems rest on the foundation of limitless expansion of energy, consumption, debt and “money” (assets and currency in any form). So a realistic pathway to degrowth requires an entirely new construct of the economy, governance and finance. The vast majority of proposals are fixated on replacing every unit of energy we now consume as the absolutely minimum required for human well-being.

    This is of course magical thinking. Widespread well-being without the churn of “the landfill economy,” waste as consumption, debt, speculation, unproductive complexity, etc. could be managed with half or less of current consumption. For some reason humans find it easy to dream up ways to maintain staggering waste but resist ways to reduce completely destructive waste and complexity.

    All of which is to say that it’s not just ill-informed people who latch onto magical thinking, the highly educated and well-informed also tend to choose the magical thinking of limitless energy and consumption as “the solution.” In my view, this suggests that any real progress will require a bottom-up change in the cultural understanding of degrowth–what I call the social ontology.

    I hesitate to mention my new book as it smacks of self-promotion so I will just report that I have written 94,000 words outlining a transition to degrowth that improves and distributes well-being. I welcome better plans but we have to start somewhere, not just at the technical level but at the levels of cultural understanding, values, governance and local / decentralized energy, production, agency, capital and governance.

  45. TonyH

    This is a link to the Tom Murphy article Joe Clarkson mentions above.


    “There is nothing magic about fossil fuels”

    Well…….. actually there is, (or rather, there was.) Oil had an ERoI back in the 1950’s of 1:100 or more!!!!!!!! In 1919, a barrel of oil used in exploration, discovered 1200 barrels!!!!!!!!

    No other energy sources comes even close to those kinds of returns and the modern world was built on it.

    Once the ERoI falls, so does society’s complexity.
    Hydrogen manufacture from electrolysis, is not particularly efficient use of electricity.

    Apologies to other readers of the blog, but I keep posting links to this ebook.

    It’s worth a read TonyH, if you have the time.


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