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Up till now the physical distinction was not important. Humanity was coming up with new ever more effective energy sources and ways to "produce" them.

But now things change. If we talk in pure physics terms, what does the Second Law of Thermodynamics imply? Sure, it talks about zero energy throughput directly - but apparently a fixed finite value allows just limited valuable effects. Regardless of what money we may come up with. In other words:

There can be no perpetum mobile of a monetary (or social) kind!.

by das monde on Sun Jun 22nd, 2014 at 10:13:43 AM EST
[ Parent ]
That is the problem that inflation solves for you.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sun Jun 22nd, 2014 at 10:44:10 AM EST
[ Parent ]
Not really, when resource limits are in sight.
by das monde on Sun Jun 22nd, 2014 at 11:02:18 AM EST
[ Parent ]
Yes really, you can have a monetary perpetual motion, so long as you do not insist on money being a viable vehicle for storing value over a greatly longer period than the production cycle.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sun Jun 22nd, 2014 at 11:45:36 AM EST
[ Parent ]
Money is a license for productive activity. With too much license, production eats into resources. ("Storing value" actually helps to restrict production.)
by das monde on Sun Jun 22nd, 2014 at 12:00:06 PM EST
[ Parent ]
I guess you have no objection to mass unemployment, then?

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sun Jun 22nd, 2014 at 02:17:48 PM EST
[ Parent ]
If my preference would matter.
by das monde on Sun Jun 22nd, 2014 at 04:15:19 PM EST
[ Parent ]
Crashing the economy into permanent depression has a very poor track record as a way to improve the sustainability of your economic trajectory.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sun Jun 22nd, 2014 at 02:26:21 PM EST
[ Parent ]
See, for instance, the worsening of pollution in Greece as people go back to burning whatever they can get their hands on. Os Spain's U-turn on renewable energy investment.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sun Jun 22nd, 2014 at 03:00:44 PM EST
[ Parent ]
By the way, you're aways going to find shills for austerity in any situation. Take the Daily Mail: Is the financial crisis good for the environment? Pollution falls by 40 per cent in Greece since 2008 (7 January 2013)
* Researchers record drop in nitrogen oxides and sulphur dioxide
  • Fewer people using cars as householders save money in austerity cuts
  • Reduction in industries of 30 per cent  causes lesser emissions
Just a month later on CBC: Air pollution in Athens escalates due to government's austerity measures (February 8, 2013)
If it smells like pine spirit in parts of Greece these days, they have the smoke from home heating fires to thank for it. And not in a good way. Air pollution is the latest fallout from the Greek austerity measures. People are burning trees from the parks, old furniture -- anything to avoid paying soaring new taxes on heating oil.
But hey, fewer cars and heavy industry!

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sun Jun 22nd, 2014 at 04:41:41 PM EST
[ Parent ]
And you can blame austerity, not resource scarcity: Greece's Economic Crisis Leads To Air Pollution, Study Finds (December 20 2013)
"People need to stay warm, but [they] face decreasing employment and rising fuel costs," explained Sioutas, senior author of the study in the journal Environmental Science & Technology. "The problem is, economic hardship has compelled residents to burn low-quality fuel, such as wood and waste materials, that pollutes the air."

Since 2008 Greece's economy has shrunk by 23 percent and it has since been dependent on rescue loans from other European Union countries and the International Monetary Fund. Making matters worse, oil prices have almost tripled over the past few years due to tax hikes.

In response to energy costs, Greeks have been turning to wood as a fuel source to heat their homes, which impacts air quality.

(My emphasis)

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sun Jun 22nd, 2014 at 04:44:02 PM EST
[ Parent ]
Cars and heavy industry= evil capitalist consumerism, large scale exploitation of resources, and ravaging of the environment

Burning whatever you can to stay warm= distributed independent local small-scale generation :)

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Mon Jun 23rd, 2014 at 03:36:31 PM EST
[ Parent ]
You forgot living in caves by candlelight.
by afew (afew(a in a circle)eurotrib_dot_com) on Mon Jun 23rd, 2014 at 03:43:37 PM EST
[ Parent ]
How romantic! Much better than these dreary fluorescent lights...

Peak oil is not an energy crisis. It is a liquid fuel crisis.
by Starvid on Mon Jun 23rd, 2014 at 03:54:00 PM EST
[ Parent ]
distributed independent local small-scale generation of wind and solar = heavy industry, because you need heavy industry to produce the solar panels and wind turbines.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Mon Jun 23rd, 2014 at 06:11:11 PM EST
[ Parent ]
Which means that while it may well be distributed and small-scale, it will be neither local nor independent.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Jun 23rd, 2014 at 06:25:03 PM EST
[ Parent ]
While there's no disputing Mig's point (and I don't), yours seems to be a quibble.
by afew (afew(a in a circle)eurotrib_dot_com) on Tue Jun 24th, 2014 at 12:58:50 AM EST
[ Parent ]
It really isn't, unless you accept as a matter of course that industrial society is not, primarily, governed bottom-up.

There are plenty of people who would dispute that proposition.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Tue Jun 24th, 2014 at 05:27:19 AM EST
[ Parent ]
Not sure I follow you there.

My point is that "local-ness" and "dependence" are not absolutes. Endeavours of different kinds may be more or less local, more or less autonomous.

If my municipality's electricity authority buys a turbine, it isn't buying local production and it isn't independent of non-local heavy industry. But that turbine installed on the river is local in the sense that the energy source is local, the finance is local, distribution is locally-owned, and the management is to some extent local. There's a degree of dependence and a degree of autonomy.

If I have a farm, that has distinct characteristics of "local-ness": the soil, the climate, the hydrography limit or potentiate my production. That production may also be locally sold. I cannot produce without the aid of industrial goods (tools), but the tools are useless without the other factors of production that I possess.

Why this matters to me is because, in my view, the richness and liveliness of a democracy are enabled by a degree of local autonomy, and depleted by the alienation of authoritarian top-down structures.

by afew (afew(a in a circle)eurotrib_dot_com) on Wed Jun 25th, 2014 at 05:37:45 AM EST
[ Parent ]
Your definitions for local and dependence may work - for the scale you apply them: local autonomy.

They probably fall apart the moment you consider them, like I assume Jake is doing, at the system-wide, global scale.

It reminds me of structural geology: on the basis of local observations one can only assume the geological history of one local area as true, for as long you don't look at the area at a regional scale - which can show you that your assumptions were perfectly holding for the scale you were using, but perfectly wrong for applying them at a larger perspective.

by Bjinse on Wed Jun 25th, 2014 at 07:57:08 AM EST
[ Parent ]
Migeru:
distributed independent local small-scale generation of wind and solar = heavy industry, because you need heavy industry to produce the solar panels and wind turbines.

That postulate seems limited to our not building larger wind/sun farms, big enough to make themselves so to speak.

Industry heavy enough to create turbines and multi-GW solar arrays is no more energy-demanding than other industries that were localised a century ago. Before we chose location for ease-of-transport reasons more as the international highway and railway infrastructure was not as fortified as it is now, sticking and hubbing mainly around big waterways, the obvious 'freebie'* at that time.

With electricity abundance at low cost these industrial products (panels and turbines) are surely not more labour and resource hogs than building out the Nazi war machine for example in the 30's.

And even if my analysis is wrong, it seems a no-brainer to use dwindling supplies of eco-expensive fossil fuels to build a bridge to the land where we would need less of them. Can't think of a better one in fact!

Throw in bioplastics such as Henry Ford used for the Model T (hempseed easily, quickly and cheaply grown), nanotech and 3D printing and you have the perfect mix of techologies and low footprint energy needs to belie this myth that turbines and panels are advanced rocket science only appropriate to be made in behemoth Ruhr-like industrial centres using oil and/or gas as fuels. From Rurhal to rural!

* Plastic is now being made from orange peels, egg shells, wood 'flour' and pretty much any organic matter, So you would have the knockon effect of safely recycling a lot of 'waste' as well.

The sooner this myth is dismantled the better, imo, as it is really holding us back, especially the biggest is bestest mentality that's baked into it. Surely you don't have to be a Schumacher to understand that.

There's a lot of continuum being skipped over between the poles of Krupp-Thyssen-sized Leviathans and candles in caves.

We may yet avoid the "Black Mirror" scenario of millions of unemployed manning stationary bikes to generate society's juice paid in 'credits' (scrips), but even that would be better than looking out your window at a new nuke plant and wondering if some series of trivial 'oopses' are going to cascade that day, as happened at Three Mile Island.

Or that some combo of earthquake and Climate Chaos-whipped Superstorm is going to make a very ocean-souring joke of our engineering hubris.

There's going to be a lot of re-tooling to do, by leaving it all to the last innings we are just upping the costs and killing ourselves with pollution while doing so.

** Wind and solar are the ultimate freebies, and ever so slightly less predictably dangerous than swollen rivers can be, cf Serbia recently, Somerset last summer etc etc. But that's another discussion more about transport, though it is intimately connected as the sooner we phase out FFs the less extreme our weather will be.

(Pace Bjinse) :)

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Tue Jun 24th, 2014 at 03:32:12 AM EST
[ Parent ]
Industry heavy enough to create turbines and multi-GW solar arrays is no more energy-demanding than other industries that were localised a century ago.
It's not the energy demands that make me call it heavy industry. It's the fact that we're talking about rotor blades the size of large aircraft wings, and of advanced materials in the case of photovoltaics. Both of those require large, complex facilities.

But your point on energy is important also in another respect: modern industrial technology is way more efficient in its use of energy and material resources than "traditional" production methods. That's what technological progress is about. It's not only improvements in final products but in every intermediate step of production.

And that, my friends, is why rolling industrialization back is definitely not the answer to resource constraints.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman

by Migeru (migeru at eurotrib dot com) on Tue Jun 24th, 2014 at 04:20:15 AM EST
[ Parent ]
modern industrial technology is way more efficient in its use of energy and material resources than "traditional" production methods.

I'm not convinced this is true if you consider the resource cycle as a whole.

You can cherry pick items like electronics which look small and cheap, but the complete cycle includes ripping stuff out of the ground and shipping it around the world.

And you not only have to refine the stuff you're shipping, you also have to refine the stuff to build the things you're shipping it in. And fuel them.

And then there are the various levels of repetition and recursion involved in putting it all together.

A truly efficient technology would do this with no mess. We're a long way from anything like that - so far away that on a planetary scale, it's not obvious we've moved on from the 19th century.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Tue Jun 24th, 2014 at 05:12:01 PM EST
[ Parent ]
A truly efficient technology would do this with no mess.

That's not an argument for returning back to "traditional" production methods, nor an argument that these would be more efficient, but only an argument that the current state of industrial process and the intermediate steps of production can be further optimised.

by Bjinse on Wed Jun 25th, 2014 at 04:58:46 AM EST
[ Parent ]
Migeru:
rolling industrialization back is definitely not the answer to resource constraints.

Who says it is, the straw man with his candle-lit romantic atmosphere?

It's about en -rolling industry into maxing out negative entropy

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Wed Jun 25th, 2014 at 12:00:47 AM EST
[ Parent ]
Migeru:
"traditional" production methods.

What are these, and who is advocating them?

by afew (afew(a in a circle)eurotrib_dot_com) on Wed Jun 25th, 2014 at 05:09:57 AM EST
[ Parent ]
OK. Since light snark against your caricature seems misunderstood:

"cars and heavy industry" have a rap sheet as long as your arm in terms of ravaging the environment. They are going to have to change, and don't tell us they will do so voluntarily, the evidence up to now is to the contrary.

The second part of your remark is not far off trolling.

by afew (afew(a in a circle)eurotrib_dot_com) on Tue Jun 24th, 2014 at 12:55:45 AM EST
[ Parent ]
Yet, the crashing course is begin repeated verbantim as it happened before, or even with improvements. This time it is going so smoothly, without any political opposition whatsoever. There must be a reason for that.  
by das monde on Sun Jun 22nd, 2014 at 04:14:31 PM EST
[ Parent ]
Yes, politics. Of which the last is:By ascribing austerity to the laws of physics or of human nature or whatever, you become a fellow traveller of the plutocrats, just like Greg Mankiw uses faux-microeconomics to justify hoarding and dynasties.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sun Jun 22nd, 2014 at 04:23:19 PM EST
[ Parent ]
I would love to test non-austerity. But all I can do now, is to guess how much evil appears to be necessary in THEIR eyes.

By the way, did not notice particularly bad air pollution in Athens. The usual car stink in summer heat is still most prevalent.

by das monde on Sun Jun 22nd, 2014 at 04:53:07 PM EST
[ Parent ]
There Is No Alternative™, energy accounting edition.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Mon Jun 23rd, 2014 at 07:12:34 AM EST
[ Parent ]
Fiat money does not promise resources on demand, or that they'll be cheap.

It does promise that it will always be possible to mobilize existing idle resources, and that it will be impossible for people to issue mnetary claims in excess of available money.

That's more than any commodity money can deliver.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman

by Migeru (migeru at eurotrib dot com) on Sun Jun 22nd, 2014 at 02:16:36 PM EST
[ Parent ]
If some resource (say, energy or water) would become an obvious bottleneck for "civilized" living, "indespensible" technology, or just survival, wouldn't that resourse become de facto hard currency? How long would that bottleneck be masked by monetary overflow or scarcity?
by das monde on Thu Jun 26th, 2014 at 01:45:04 PM EST
[ Parent ]
If some resource (say, energy or water) would become an obvious bottleneck for "civilized" living, "indespensible" technology, or just survival, wouldn't that resourse become de facto hard currency?

That is the Austrian position (Misean regression).

The Austrian position is wrong.

What makes currency currency is that contracts and tax liabilities are enforced in terms of the currency.

Money is not a store of value. Money is a tool of contract enforcement. The state of scarcity or abundance has the next best thing to nothing to do with the rules for contract enforcement.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu Jun 26th, 2014 at 06:13:41 PM EST
[ Parent ]
Contracts do not exist in an abstract paradise. If their implementation is the unconditional priority regardless of real world limits (particularly, in resources) you soon have some austerity, factual opression in whatever dressing. Thus, what's your prefered endgame when the contracts, exponential obligations meet definite limits of the physical reality?
by das monde on Fri Jun 27th, 2014 at 09:00:47 AM EST
[ Parent ]
Bankruptcy is a beautiful alternative to debtors prison. In the US they have an even more helpful solution, called Chapter 11.

Peak oil is not an energy crisis. It is a liquid fuel crisis.
by Starvid on Fri Jun 27th, 2014 at 10:12:46 AM EST
[ Parent ]
This is the problem that inflation solves for you.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Fri Jun 27th, 2014 at 06:07:15 PM EST
[ Parent ]
..wouldn't that resourse become de facto hard currency?

No. Money is not some natural product of human society. If the monetary economy breaks down and can't deliver live essentials it won't necessarily be replaced with a new one of the same kind. It's just as likely that money would loose all meaning in face of rationing. Or in the face of collapse of society.

by generic on Fri Jun 27th, 2014 at 10:28:00 AM EST
[ Parent ]
At least until some kind of state would re-emerge, even if it is, say, crude warlordism. As soon as the rulers want the taxes paid with money, and starts issuing money, the monetary economy returns.

Peak oil is not an energy crisis. It is a liquid fuel crisis.
by Starvid on Fri Jun 27th, 2014 at 10:48:07 AM EST
[ Parent ]
But once the value of bottleneck resources exceeds the practical value of monetary debts, the investor class will change their preference. That's perhaps the super-Minsky moment of hyper-inflations, narowly monopolized resources, society (as we know it) collapse.
by das monde on Tue Jul 1st, 2014 at 06:20:35 AM EST
[ Parent ]
That's what we had in the 1970s (stagflation). Now we're having deflation because hard-money ideology has solidified.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Jul 1st, 2014 at 06:33:06 AM EST
[ Parent ]
I rather believe that stagflation was there to discredit Keynes - rather than an example of a resource wall.

By now, the ideology evolved to "a systematically organized body of knowledge" of how to keep the monetary control dominant (for as long as possible, at least).

by das monde on Tue Jul 1st, 2014 at 07:07:14 AM EST
[ Parent ]
Stagflation was a real economic phenomenon, it wasn't "made to happen". And it was indeed seized upon by monetarists to discredit Keynes. And Austriand and Ordoliberals latched on to monetarism because they agreed with the policy prescription of the monetarists (in the 1970s environment, monetary contraction). And then what had happened was rationalised and blended with pre-Keynesian economic thought, and since 2007 monetarists have found to their horror that the actual political power rests with the Austrians. Now the policy prescription on which Keynesians and monetarists agree is one of monetary expansion, with disagreement on whether fiscal stimulus in necessary or just not harmful. But the common-sense conservative hard-money view hasn't been discredited yet. Austerity is just being tweaked around the edges. And here we are.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Jul 1st, 2014 at 07:22:09 AM EST
[ Parent ]
Forcing a rentier portfolio shift to production and distribution of a bottleneck resource cannot (in and of itself) cause hyperinflation.

And having rentier portfolios shift toward actually useful work would be a good thing.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Tue Jul 1st, 2014 at 06:35:40 AM EST
[ Parent ]
We would talk then of resource capture by the same rentiers, rather than useful investment.
by das monde on Tue Jul 1st, 2014 at 06:43:56 AM EST
[ Parent ]
Contrary to what you seem to believe, the real world contains very few Bond-villains with white cats in volcano islands who habitually crash major industrial supply chains for shit and giggles.

Usually, they do it for money, and there's no percentage in cornering the market unless you plan to actually sell the product at some point.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Tue Jul 1st, 2014 at 06:51:01 AM EST
[ Parent ]
We are not in the tight resources hold yet (even in the 70s). For James Bond to have the same lifestyle then, the good guys would be resource "protectors".
by das monde on Tue Jul 1st, 2014 at 06:58:40 AM EST
[ Parent ]
If some resource (say, energy or water) would become an obvious bottleneck for "civilized" living, "indespensible" technology, or just survival, wouldn't that resourse become de facto hard currency?
No, it would become very expensive, and subject to rationing.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sat Jun 28th, 2014 at 02:23:38 PM EST
[ Parent ]

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