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by Jerome a Paris
I'm usually known as one of the doomers'n'gloomers on the blogs, with diaries and comments on the economy heavily leaning towards negative views. And to a large extent, I still stand by these positions and fully expect (i) the economy to dive again and (ii) an even worse financial crisis coming our way.
I'm also part of the peak oil / peak resources crowd, and do not consider our current civilisation, especially as hundreds of millions in emerging markets rush to embrace it, to be sustainable. The Chinese and Indians and others cannot all live with the same resource consumption as we currently have in the West, and something will have to give at some point. And this is a matter of years rather than decades, and most of us here will get to see that problem 'solve' itself. And of course, climate change adds a whole other dimension to that emergency. But, surprisingly, I also have a number of arguments to be optimistic for the medium term, ie that let me hope that I will not spend my late years in poverty and/or in the middle of societal collapse.
First, on the economy. The one thing I would like to point out is that we lived, in the past couple decades, at a time when several unique factors combined to create a kind of "perfect storm" which brought us the biggest bubble in history.
This period is coming to an end. Resource constraints are reasserting themselves. The extremist push by the largely parasitic oligarchic class to capture an ever increasing chunk of wealth is being stopped by the fact that parasites are only successful when they don't kill their host, and right now the middle classes whose productivity they have successfully harnessed for their sole benefit are barren. China's drive to do all our pollution for us is choking the country. Their coal is likely to run out soon, at current rates of production, and production growth. And, more importantly, they are undergoing a major demographic transition, as a result of the one-child policy of the past decades. Their working age population will soon decline - the all-important 20-39 demographic is already declining. Right now, it doesn't look like things will soon turn out badly for the oligarchs. After all, they managed to increase their grip on our politicians during the great financial crisis, imposing a bailout of themselves over actually saving the economy. The political classes, mass media and more generally the Serious People all think that things are going well and that their ideology has been, once again, successfully pushed onto a hapless populace. And we haven't fully paid the price of the excesses of the past decade. The mountain of debt which was used to hide the wholesale looting of the middle classes is still hanging over us; the prosperity of the future which has been captured already by the wealthy through financial shenanigans will not be available to us now, barring a massive debt repudiation which applies to other instruments than our pensions ; the resource constraint, which temporarily subsided as the economy crashed is still waiting for us around the corner. So, why the optimism?
Right now, it may look like if anything, the political framework is still moving in the wrong direction and, worse, if there is any popular backlash, it seems more likely to come in the form of a reactionary populism (ie scapegoating, fearmongering fascism) than the required progressive soak-the-rich kind. But while you can debase a currency and lie to people, you can't cheat with nature. You can't print megawatthours or joules or molecules of helium or rare earth metals. You can't drink poisoned water or non existent water. At some point, the very survival of any form of public authority will be at stake, and politicians will suddenly remember that States have incredible powers, do not actually need to be subversient to short term private oligarchic interests, and will start yielding that power towards strategic objectives. And when the goal is full scale mobilisation towards survival, resources will go where they need to go, not to death-inducing capture by parasites. Of course, this begs the question of what will trigger this survival mechanism. Do we need to get to the brink, and see thing worsen yet again (possibly a lot more) before we get there? I guess this is where my optimism comes in: I think the natural constraints are going to come for a while in the form of steadily increasing constraints (via prices, for instance) rather than outright shortages, and this will trigger enough action to move us on a different path, even if this is not immediately obvious. Oil at $70 per barrel in the midst of a massive recession and demand reduction is an unmistakable sign. Or, in other words, the one hundred billion euros in the stimulus and TARP that went to renewable energy and bailing out GM will matter more, ultimately, than the trillions handed out to banks and bondholders, as one created or saved vital industrial infrastructure while the other just moved some electrons around, with no large scale long term consequences in the real world. And if it takes yet more trillion-scale hand outs of fiat money to the parasites to authorise yet more real investment, this is the sneaky route that our adaptation to reality will take. Or who knows, maybe we'll get a real leader one of these days, able to steer us away from the wall before we actually hit it and get hurt. Now believing in that would be wildly optimistic! |
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An optimistic diary (for once) | 243 comments (243 topical, 0 editorial, 0 hidden)
An optimistic diary (for once) | 243 comments (243 topical, 0 editorial, 0 hidden)
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