Tag Archives: Peak Oil

King Romney’s Dream for America: Slave Labor in Barb-Wired Factories & a Double Down on Fossil Fuels

26 Sunday Aug 2012

Posted by in Capitalism, Corporate State, Environmental Degradation, Inequality, Peak Oil, Wall Street Fraud

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On the Labor front….

I came across the above video yesterday evening. It’s a recording of Mitt Romney recounting his days at Bain Capital when he was off-shoring U.S. manufacturing to slave labor camps in China. From the video I’m assuming that America’s gift to the world, as Romney refers to it, is neoliberal capitalism and the privilege that economic system brings to the masses who can enjoy working for pennies per hour in a sweatshop factory complete with dormitories holding “12 girls per room”, all of which is enclosed by barb-wired fencing. And as Romney relates, the fences are to keep the hoards of people out who are dying to fill a position in the factory as soon as someone falls over. For Romney and the typical vulture capitalist, this is a wet dream: endless numbers of cheap laborers ready to fill assembly-line positions which are unencumbered by unions, safety regulations, and basic rights for workers. In such factories humans are reduced to cattle in order to extract the maximum profit. A Foxconn executive expressed the general sentiment of corporate capitalists when he referred to his workers as “animals” earlier this year. Despite recent reports by the Fair Labor Association (FLA) on the heels of an eye-opening report on labor conditions, the reality on the ground, as Romney can attest to from his days at Bain, is the same as it ever was:

As reported here, China Labour Watch is claiming that bribery is undermining the audit system. China Labour Watch founder Li Qiang has not minced his words: “Although the working hours at Foxconn have been reduced to less than 60 hours per week, the intensity of the hourly work has been increased. According to our follow-up investigation, the workers have to complete the workload of 66 hours before within 60 hours now per week. As a result, the workers get lower wages but have to work much harder and they are not satisfied with the current situation. The harsh working conditions are by no means isolated to just Foxconn but exist throughout Apple’s supply chain. However, that report only focused on Foxconn factories. It is Apple’s entire supply chain system that should be responsible for the squeezing of workers.”

On the Energy Front:

King Romney is going to double down on fossil fuels in America, further dismantling regulations and awarding more tax breaks for Big Oil:

Romney unveiled his energy plan, which makes no mention of climate change and focuses on reaching energy independence by 2020 through increased extraction and use of oil, gas and coal, accompanied by reduced regulation for these industries.

The plan underlines the fact that the Republican Party and the oil, gas and coal industries, long in agreement on policy and ideology, have grown closer than ever before. Romney, whose top energy adviser is the wealthiest oilman in the country, is on pace to raise more money from these industries than either George W. Bush or Sen. John McCain (R-Ariz.) did when he ran for president. The industries are also pumping millions into the new unlimited money vehicles, super PACs and dark money nonprofits, that are spending tens of millions of dollars per month to influence the election…

…A central part of the plan is taking the power to permit and license new onshore drilling on federal lands out of the hands of the federal government and putting it into the hands of the states. That means that states like Alaska or North Dakota, which is enjoying a massive oil boom under the current regulatory regime, would be able to allow drilling on federal lands with no oversight from Washington.

North Dakota stands out, in particular, as it is where Romney’s top energy adviser, oil billionaire Harold Hamm, is making his fortune. Hamm, whose stump speech is only three words, “Beat Barack Obama,” has given $985,000 to Restore Our Future and raised money for the Romney campaign. He would profit greatly from this change in policy as his company, Continental Resources, would be freed to drill beyond the Bakken fields in North Dakota using techniques including hydraulic fracking and horizontal drilling….

…Among many other policies supporting the industry, Romney calls for a repeal of regulations limiting the amount of mercury, a hazardous pollutant, that can be emitted from coal and oil power plants…

Overlooking the catastrophic externality of climate change, notice that Romney is heralding America’s energy independence through his plan of ‘Drill, Baby, Drill’ of fossil fuels. If you look at the following graph, you’ll see that there is no amount of drilling we could do within America to achieve fossil fuel energy independence:

As you can see, America hit peak oil around 1970 at 9.637 mbpd (million barrels per day), as predicted by Hubbert, and then in 1993 America’s domestic oil production was surpassed by consumption, a point from which we have never recovered. Even with the recent drastic drop in consumption due to an anemic economy, we are still importing around 10 to 11 MBPD while domestic production is somewhere between 7 to 8 MBPD. Domestic production would have to double from the current rate or total consumption, which sits currently at roughly 18 to 19 MBPD, would have to be halved while allowing for the requisite economic growth that we worship. That’s not going to happen. As Loren Steffy explains, “U.S. oil production gains are like water pumps on the Titanic“:

…The much-ballyhooed increase in U.S. production simply isn’t enough to have a meaningful effect on global oil prices, which doubled from 2005 to 2011. That ultimately is the biggest factor in setting prices for retail gasoline.

U.S. production gains look impressive, but much of it offsets declines earlier in the decade because of major hurricanes that disrupted offshore and Gulf Coast facilities. Domestic production was 7.5 million barrels a day in 2010, according to the Energy Information Administration, and that number probably increased to about 7.7 million barrels last year, estimates Jeffrey Brown, an independent petroleum geologist in Fort Worth who writes frequently on oil issues.

In 2004, before the spate of hurricanes, production was 7.2 million barrels. That means domestic production hasn’t increased more than about 500,000 barrels a day despite the fracking binge and other efforts to encourage drilling. During the same period, net exports for all countries in North America — including Canada, Mexico and Venezuela, some of our biggest suppliers — fell by 1.4 million barrels, or 23 percent, according to Brown’s analysis.

Brown compares the situation to water flowing into the Titanic after it hit the iceberg.

“Let’s assume that water is pouring into the ship 10 times faster than than water is being pumped out,” he said. “The water being pumped out is analogous to the slow increase in U.S. crude oil production. The water flowing in is analogous to declining annual net exports. Guess which metric most people seem to be focused on?”

That doesn’t even account for China, India and other rapidly developing countries, whose oil imports are rising sharply, increasing the competition for oil with countries like the U.S.

“So, while slowly increasing U.S. crude oil production is very important, the dominant trend we are seeing is that developed oil importing countries like the U.S. are being gradually priced out of the global market for exported oil,” Brown said…

King Romney, nevertheless, will use the rallying call of his energy plan to increase domestic oil production, with its attached gifts of even more environmentally destructive deregulation and kleptocratic giveaways to Big Oil from the taxpayer, as a reason for voters to put him into the White House. But as pointed out at Fair.org, this is all a smokescreen manipulating public perception:

In a New York Times story (8/24/12) about Mitt Romney’s energy proposals, reporters Eric Lipton and Clifford Krauss make this observation:

With gasoline prices again approaching $4 a gallon, Mr. Romney, the presumptive Republican nominee, is also trying to merge energy and economic policy in a way that will make voters see increased energy production as a pocketbook issue.

Note that Lipton and Krauss don’t say that increased U.S. energy production will actually affect the $4-a-gallon price of gas and hence the voters’ pocketbooks; that would be inaccurate, since oil is a global commodity and it’s impossible for the U.S. to increase its production enough to change it substantially. In fact, with the formulation “in a way that will make voters see,” the Times  reporters suggest that they are well aware that increased oil drilling will not actually alter gas prices–that this is a matter of changing public perceptions, not economic realities.

But then, Lipton and Krass don’t do anything in their piece to let the reader know that the implied connection between increased drilling and lower gas prices is fraudulent…

The doublespeak used by politicians of all stripes to bend reality is the same as it ever was.

The System Has Reached Entropy

24 Friday Aug 2012

Posted by in Capitalism, Climate Change, Consumerism, Corporate State, Empire, Environmental Degradation, Inequality, Military Industrial Complex, Peak Oil, Pollution, Wall Street Fraud

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Click to Enlarge…

Update on the Embattled Water-Energy-Food Nexus

18 Saturday Aug 2012

Posted by in Climate Change, Ecological Overshoot, Environmental Degradation, Peak Oil, Pollution

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I’m working on adding graphics and trimming down a couple videos made from an extraenvironmentalist podcast of interviews with energy specialists Chris Nelder and Gregor Macdonald; but in the meantime, here is an update on the water-energy-food nexus exacerbated by climate change which I blogged about here. The social consequences are spelled out:

…US farms are already crippled: the Department of Agriculture says the corn (maize) crop is likely to be the worst since 1995. As a result, the Food Price Index (FPI) of the United Nations Food and Agriculture Organization rose 6 per cent in July, to 213.

That is dangerously high, says Yaneer Bar-Yam of the New England Complex Systems Institute in Massachusetts. He has found that if the FPI goes above 210, riots and unrest become more likely around the world. Both the 2011 Arab Spring and the 2008 riots in places such as Mexico, India, Russia and Belgium may have been partly triggered by high food prices.

More unrest is likely in the next year, although we cannot predict where, says Bar-Yam. That depends on how governments respond… – source

…and on the energy and water front:

…Power plants are a hidden casualty of droughts, says Barbara Carney of the National Energy Technology Laboratory (NETL) in Morgantown, West Virginia, because they are completely dependent on water for cooling and make up about half the water usage in the US. That makes them vulnerable in a heat wave. If water levels in the rivers that cool them drop too low, the power plant – already overworked from the heat – won’t be able to draw in enough water. In addition, if the cooling water discharged from a plant raises already-hot river temperatures above certain thresholds, environmental regulations require the plant to shut down.

One nuclear plant in Connecticut recently had to shut down because the sea water used for cooling was too warm. Nationwide, nuclear generation is at its lowest in a decade, with the plants operating at only 93 per cent of capacity.

Nuclear is the thirstiest power source. According to NETL, the average nuclear plant that generates 12.2 million megawatt hours of electricity requires far more water to cool its turbines than other power plants. Nuclear plants need 2725 litres of water per megawatt hour for cooling. Coal or natural gas plants need, on average, only 1890 and 719 litres respectively to produce the same amount of energy….

Bio fuel thirst

Reports of how much energy the US has generated this summer won’t be released for some months, he says. The North American Energy Reliability Corporation’s most recent report (PDF) calls the drought outlook “not optimistic” for energy, but says that most of the US should be able to meet its energy demands this year. The exception is Texas, where resources are expected to be tight.

Utility-scale power isn’t the only energy source being hurt by the drought, however. With corn harvests expected to be as low as 75 per cent of normal yields, biofuel production is also suffering. Compared to other energy sources, biofuel production requires the most water.

…Arjen Hoekstra of the University of Twente in the Netherlands calculates the total water use of different industries – including not just cooling but every step in the supply chain as well. According to his “water footprint calculator”, biofuels require orders of magnitude more water than any other energy source… – source

Some farmers profit from the energy industry’s scramble for water while other farmers are fearful, holding back water for their crops…

…Select Energy sources water for oil companies in drilling hotspots across the country, and some landowners can make between $70,000 and $85,000 over the course of a year and a half by selling the water in their ponds to the company, said Mike Wilson, a regional sales manager at Select Energy.

But many landowners aren’t as willing to give up their water now that supplies have become so scarce.

“Farmers are scared about the water supply, too,” said Jeff Gordon, CEO of Texas Coastal Energy Co., a small oil company that began exploring in Kansas last year. “They are now saying, ‘We need to save our water for our crop and our livestock.’ ”

Related: Farmers hit the jackpot in Kansas oil boom

With two oil wells slated to be drilled in the next month, Texas Coastal is considering drilling its own water well at a cost of between $10,000 and $25,000.

Otherwise, it would have to pay to truck water in from out of state or buy it from local farmers and ranchers. Either method could add 3% to 4% to the overall cost of drilling an oil well. Depending on the size of the well and the amount of water required, that could add up to between $20,000 and $200,000.

To the oil companies, it’s worth it. With oil prices hovering around $90 a barrel and the cost to produce a barrel of oil only around $15, the profits are huge, said Gordon, whose company is still aggressively leasing mineral rights, which gives it rights to drill on certain properties.

If the drought worsens or persists for too much longer, however, it could threaten the oil boom, particularly among the smaller drilling companies that can’t afford the added costs and delays, he said.

Related: Boom chasers, next stop Kansas

“That can cripple a drilling company, as lack of water can basically suspend operations,” he said.

Petro River’s Alba said the drought won’t affect his current drilling plans, but he will carefully assess water availability before expanding into other areas of Kansas.

Scrambling to get the oil companies to stay: Mike Lanie, the economic development director in Harper County, which is at the center of the oil boom, is determined to keep oil companies from pulling out. – source

The United Nations Food and Agriculture Organization as well as the American livestock industry have recently urged Congress to suspend the ethanol mandate.

The financial drain on the system from the drought…

The U.S. government recently announced it would buy $170 million in various meats to help drought-stricken farmers. Other costs to the taxpayer from this epic drought include payouts from federal crop insurance programs:

Crop insurance losses: Your tax dollars on the hook
The drought of 2012 is also likely to result in record payouts from the federal crop insurance program. This taxpayer-funded program subsidizes insurance for farmers and also partially compensates private insurers, with additional emergency assistance that kicks in during extreme events like the current drought.

Last year, weather-related events led to crop insurance claims of $10.7 billion as of April 30, 2012. According to Bruce Babcock, a professor of economics at Iowa State University, this year’s losses could add up to $30 to $40 billion. Gary Schnitkey, a University of Illinois extension economist, calculates that 2012 insurance payouts for Illinois corn alone could top $3.2 billion. – source

Our response to the primary underlying cause of these increasingly disastrous droughts has been to find more drought-resistant crops and livestock. I suppose this strategy will work up to a point, but it doesn’t get at the root of the problem which is industrial civilization’s unbreakable marriage to fossil fuels.

King Romney: Stuck in Cognitive Dissonance

12 Sunday Aug 2012

Posted by in Climate Change, Peak Oil

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I did not waste my time reading King Romney’s 2010 book No Apology; The Case for American Greatness, but someone who did sacrifice some eyesight to it has some interesting observations which I’ll comment on. Romney may be the only Presidential candidate to explicitly acknowledge in writing the fact of peak oil:

Many analysts predict that the world’s production of oil will peak in the next ten to twenty years, but oil expert Matt Simmons, author of Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy, presents a compelling case that Middle Eastern oil production may have already reached its peak.  Simmons bases his contention on his investigation into the highly secretive matter of the level of reserves in the Saudi oil fields. But whether the peak is already past or will be reached within a few years, world oil supply will decline at some point, and no one predicts a corresponding decline in demand. If we want America to remain strong and wish to ensure that future generations have secure and prosperous lives, we must consider our current energy policies in the light of how these policies will affect our grandchildren. (pg 233)

Romney also acknowledges climate change, but then enunciates the contradiction the vast majority of the population cling to, which is the notion that we can limit GHG within our fossil-fuel based industrial civilization while maintaining economic growth and business as usual. This fantasy will never be, even if we were able to magically enlarge the planet and its resource base in order to accommodate more growth. So in the end, Romney is not a true Peak Oiler. His “energy policies” ultimately involve the ubiquitous growth imperative:

“It’s impossible not to take a look at our current energy policies without considering the question of climate change.  I believe that climate change is occurring – the reduction in the size of global ice caps is hard to ignore.  I also believe that human activity is a contributing factor.” (pg 227)

Romney hedges this statement in the next paragraph by saying he is “uncertain how much of the warming is attributable to man and how much is attributable to factors out of our control.” Three pages later, Mitt concludes his discussion of climate change saying that “Internationally, we should work to limit the increase in emissions in global green house gases, but in doing so, we shouldn’t put ourselves in a disadvantageous economic position that penalizes American jobs and economic growth.”  (pg 330)

Isn’t it amazing that a person who may be the next President (even though it is just a PR position for the corporatocracy) can talk about the reality of peak oil while still mouthing the imperatives of economic growth? How long will this cognitive dissonance hold out? I give it no more than a decade, at the most, if our financial system manages to be kept propped up for that long. For to finally come to grips with the finiteness of the earth and its resources and the illusoriness of the economic growth dictate is to admit that the “American way of life” never was “non-negotiable.”

Invitations sent to Potential Contributors

29 Sunday Jul 2012

Posted by in Capitalism, Corporate State, Empire, Inequality, Military Industrial Complex, Peak Oil

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Dear potential contributors (DK, Tom Tom, Kramerfaust, Sunson),

I am going to send you an invitation tonight so that you can contribute. You’ll have to sign up with wordpress in order to submit your work to me. It looks like Kramerfaust already has a wordpress account set up. Per the WordPress staff:

Your new user will now be able to access your blog by visiting the My Blogs section of their dashboard when they log in to WordPress.com.

You won’t have to blog at the site you initially create; it’s just a required formality. Or you can simply email me at Collapsitarians@gmail.com. I’m looking forward to reading your posts. More voices means more worldly knowledge to glean from and different perspectives to appreciate.

Since I started this site, the stats tell me that the top four google searches which have brought people here are the following:

1.) collapse of industrial civilization

2.) the price of offshore revisited

3.) james holmes sociopath

4.) collapse peak oil

The first one is an obvious outcome. I was surprised this domain had not been previously claimed since it seems to be such a hackneyed phrase. As Greer has noted, in the twilight of past civilizations, the elite are increasingly seen as corrupt and stories of societal collapse become popular in the mainstream culture. The second one relates to my post about the trillions being hoarded in offshore tax havens by the 0.001%. Backed by the power of the State, the global elite live in a cocoon of cossetted comfort, indifferent to the hand-to-mouth existence of the majority. They’ve got the iron fist of the Military Industrial Complex and Police State to protect their wealth from the rest of humanity who will be falling off the net energy cliff into poverty and desperation.

The third google search phrase is apparent to all unless you have been living under a rock since July 20th. We have these mass shootings periodically here in the Land of the Second Amendment just as a reminder that guns don’t kill people. Guns are completely innocent in these mass bloodlettings and should not be denied their freedom of getting into the hands of every man, woman, and child in the country. The response by the public is simply to buy even more guns. Why refute such logic in a world that thinks more debt is the answer. More debt, more growth, more firepower, more people, more wars, more cars, more profit, more, more, and more…..

 
And the last google search is not a surprise either. Despite all the propaganda of another oil surfeit, educated peak-oilers have not been swayed.

Energy is God

16 Monday Jul 2012

Posted by in Capitalism, Corporate State, Empire, Military Industrial Complex, Neo-Colonialism, Peak Oil

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Someone said in my last post that I’m making energy into a God. I’m here to tell you that energy is a God. Like a diehard cigarette addict smoking through their tracheostomy, we continue to use the stuff in the face of extinction-threatening effects to the climate. Our foreign policy revolves around how to get the stuff. In patriotic flag-waving fervor, we send our kids off to war over the stuff. Hell, we’ll butcher an entire country to grab the stuff while dressing it all up as a War on Terror. We even have a term for those poor souls suffering from the affliction of sitting on the stuff. We call it the resource curse. True to form, Iraq is the most glaring example of this feeding frenzy by the multinational oil companies, accompanied by wholesale corruption and that thunderous sucking sound of taxpayer money down a bottomless pit:

I’m still amazed at the statistic that a majority of Americans still buy the propaganda about the Iraq war, i.e. ferreting out Al Qaeda or WMD.

But sometimes the truth just slips out:

EROEI and the Collapse of Empires

14 Saturday Jul 2012

Posted by in Ecological Overshoot, Empire, Environmental Degradation, Peak Oil

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The above video is a discussion with Dr. Charles Hall of the Dept. of the SUNY-Environmental and Forest Biology. He is the primary creator behind the concept of EROEI in the field of biophysical economics. He also cowrote the new book “Energy and the Wealth of Nations“. I just heard about this book, but from the reviews I have read it appears to be essential reading for those concerned about a world faced with depleting energy sources and an economic system ill-suited to deal with this crisis.

Throughout the history of civilizations, economies have been based on energy inputs, whether by human slaves or oil energy slaves. The bits of paper and metal we receive for our work are only tokens representing muscle or brain output. Money is simply a token of energy exchange and has no intrinsic value of its own. Without the constant input of primary energy, a civilization’s economy ceases to function as it once did. The following comment by an engineer illustrates my point:

…Consider: A fit human being has a maximum productive energy output of about 100 watts.  Such a person working for 10 hours provides 1000 watt-hours of energy, which is to say, 1 kWh.  In other words, by working quite literally like a slave, a person can produce about 1kWh per day.  For this we pay $0.05 to $0.25 in most parts of this country.  Granted, that’s provided as electrical, not mechanical energy but my point is to illustrate the enormous gap between the energy intensity that was historically possible, and the energy intensity that we take for granted now.  The extreme cheapness that makes this energy intensity possible is a product of the fact that we are using up a one-time endowment of fossilized sunlight.  It is not something that can be duplicated with a renewable source.

Nor is it something that we can continue to obtain from fossil fuels for very much longer, even if we don’t care about climate change or ecosystem health.  The cheapest of fuels, coal, comes with a set of fairly immediate externalized costs – if we pursue a coal-based energy system, those externalized costs will accumulate quickly enough to drag us down in fairly short order (through e.g. medical expenses).  The current, temporary glut of cheap natural gas notwithstanding, other fossil fuels will not fill this need either.  There may be “plenty” of oil at $100/bbl, but that abundance will not be sustained at a lower price point – again, a function of declining EROEI…

The less energy you get back from the energy you invested, the worse off you are. If a civilization is expending all its energy and resources and only getting enough fuel back to function at its current state, then it is just subsisting and cannot grow and expand in complexity. With a population that is constantly increasing, this means intractable unemployment, crumbling infrastructure, and social unrest. As Joseph Tainter has explained, a complex society such as ours gets to the point where more energy is required simply to maintain the infrastructure it’s come to depend on. Forget growing or replacing, but just maintaining the present infrastructure requires more energy than was originally spent to build it. To make matters worse, a corrupt government and myopic ruling elite don’t recognize the realities of biophysical economics. Indeed, our entire economic system operates in a make-believe world that tries to impose neoclassical theorems on finite natural systems. Just as Rome imploded from the inability to maintain its over-extended reach through its limited energy resources, so too will the U.S. repeat this mistake of depleting returns on supporting a far-flung empire built from cheap fossil fuels.

Edward Burtynsky: The End of Oil

06 Friday Jul 2012

Posted by in Consumerism, Ecological Overshoot, Environmental Degradation, Peak Oil, Pollution

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Surfing the net this evening brought me to some eerie photography by a man named Edward Burtynsky. This collection is from his 12 year project about modern man’s Oil Age. Here are a few of the pictures under the title ‘The End of Oil‘ from his epic work (others can be seen here):

Click for Enlarged Slideshow

Mass Consumerism befouled the planet.

I work with Native Americans and see the rampant alcoholism, unemployment, and poverty, but their condition in the globalized capitalist economy seems to be replicated with other native people of the world as this cartoonist depicts:

Perhaps we aren’t the be-all and end-all of human progress.

George Monbiot Clueless about Peak Oil

04 Wednesday Jul 2012

Posted by in Peak Oil

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George Monbiot recently penned an interesting article entitled ‘We were wrong on peak oil. There’s enough to fry us all‘ which clearly shows that he is clueless about what the definition of Peak Oil is. George, you are an influential writer; so please read the following explanation when writing future articles about oil:

Peak Oil is the term used to describe the point when worldwide production of conventional crude oil peaks in volume, which is expected to result in increased oil prices due to a decline in the availability of cheap and easily accessible oil sources. The low hanging fruit, as it were, has been plucked.

In Monbiot’s article, he never mentions EROI or EROEI which basically is the energy you get back after investing/expending a certain amount of energy to retrieve that barrel of oil. There are a lot of resources that explain this, but I recommend Chris Martenson’s crash course, Chapter 17b, since that was the first place that taught me.

Monbiot, along with the typical business-as-usual oil analysts, misses the fact that conventional crude production has been flat since 2004 and declares that all the Peak Oil experts were wrong. He makes the mistake of lumping crude oil extraction, a conventional source, with the more generic term of ‘liquid fuels’ which include unconventional sources like deep-sea drilling, tar sands, shale oil, liquefied coal, and biofuels. The conventional sources of oil have higher EROI’s than the harder-to-get unconventional sources. This means that as we turn more and more to the difficult-to-extract sources, we get less bang for the buck because we are spending an increasing amount of our economy’s limited resources on obtaining that critical energy. Less net energy means a smaller budget for societal complexity, thus, a return to a simpler society. And the trip down the net energy ladder is an exponential, not linear, descent. Even though Monbiot completely misunderstands what Peak Oil is and that we have indeed reached it, he at least realizes what will result from our scraping of the bottom of the EROI barrel — a global ecological catastrophe. And that is something that all peak oil deniers fail to acknowledge.

Peak Oil never meant we would run out of oil; it just meant that we would get the easy stuff first and then be forced to spend ever more to get what’s left. This means more oil spills, polluted groundwater, and damage to our planet than occurred when the black stuff flowed abundantly from easily accessible areas in the earth’s crust.

Worldwide, the average EROI of oil is down to 20:1 from its original value of 100:1 eighty years ago. In the 1930s, it took about one barrel of energy to extract 100 barrels of energy. By 1970, with deeper wells and greater energy expenditures for pumping and processing the oil, the EROI of domestic oil had fallen to 40:1. Today U.S. oil is produced at an EROI of about 14:1. Globally, it takes the energy in one barrel of oil to extract 20 barrels of oil. This means that our oil-fuelled economy simply has less capacity to generate wealth than it did back then, because we have to increase the share of the energy that used to be dedicated to producing goods and services back into extracting more energy.

Even more troubling than oil’s 20:1 global average is the figure for new oil, just 5:1. It takes a lot of energy to drill five miles under the ocean and pump crude back to a refinery, or to cook tar sands to extract a usable fuel. The energy wellspring at the heart of our economy no longer gushes a torrent of wealth; it is a smaller, much-diminished stream. – source

Fortunately, there was at least one commenter of George’s article at the Guardian who understands all this:

George, peak cheap oil has come and gone. Hubbert’s sphere was the low-hanging fruit. EROEI with what remains means a permanent era of high energy prices: this is, put simply, the difference between charging folk to pick-yer-own strawberries and paying workers to harvest them from treetops (health & safety precautions included).

Studying this phenomenon, in 2007-8 I predicted a downward staircase pattern whereby oil would spike repeatedly every 1-3 years; this would burst economic bubbles and create recession and demand destruction. The latter would calm the price back down and then the cycle would repeat itself. I see no reason at all to alter that forecast…

I noticed that Dave Cohen also did a Monbiot write-up explaining the naivety of George in his jumping on the bandwagon of the corporate fossil fuel PR team. Human bias runs through 99% of mankind’s discourse; so the sooner you learn to question everything, the better off you will be in learning to discern the truth from self-serving ulterior motives.

Now back to my supposed sabbatical…

Ponzi Schemes and Pitchforks

29 Friday Jun 2012

Posted by in Climate Change, Consumerism, Corporate State, Ecological Overshoot, Environmental Degradation, Peak Oil

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I mentioned in my last post “Things are Heating Up for Heads on a Pike” that Las Vegas is building another straw below the existing water intake pipes which are in danger of going dry due to a sinking water line in the Colorado River and Lake Mead. Since Vegas gets 90% of its drinking water from the river, its evaporation and depletion puts in jeopardy not only that city but also the 38 million people in the Southwest dependent on the river. If you read the article I linked to, then you’ll know Vegas has been plagued by all sorts of problems like cave-ins and floodings in the construction of this new, longer straw to suck out what remains of a river in critical condition from severe drought and over-usage, both of which are exacerbated by global warming:

The Lake Mead surface level has dropped about 100 feet in elevation since the lake was full in 2000, bureau spokeswoman Rose Davis said. It is about half-full today — displaying a distinctive white mineral “bathtub ring” between the low and high water lines. – source

———————

…water authority General Manager Pat Mulroy has described the third intake project as a race against time. The problem is there is nothing very speedy about construction on this scale.

The finished, 20-foot diameter intake pipe will allow the authority to draw up to 1.2 billion gallons of water a day from Lake Mead even if the surface drops another 90 feet.

It also will give the authority access to the deepest part of the lake, where the coolest, cleanest water is found. – source

The German-buit machine used to dig this new water intake looks like something out of a science fiction movie, over 600 feet long and costing $25 million:

The $25 million tunnel boring machine was designed and built in Germany specifically for the third intake project.

“It’s the BMW of TBMs,” McDonald joked.

The machine crossed the globe on a container ship. It took 61 tractor-trailers to deliver it in pieces from the Port of Long Beach, Calif., to the job site at Lake Mead.

Fully assembled, the machine is the length of two football fields and weighs more than three Boeing 747 jetliners. The cutter head, a ridged platter 231/2 feet tall and studded with disks made from a special alloy, weighs 150 tons all by itself. – source

This project doesn’t come cheap at a cost of $800 million dollars. Now I find it rather humorous when the Vegas customers get their new water bills, causing them to fly off the handle and grab a pitch fork:

A couple of weeks ago, the Las Vegas Valley Water District got an earful from customers about a steep rate hike on businesses.

On Thursday, it was the Southern Nevada Water Authority’s turn.

A handful of angry business owners and residents attacked the rate increase during the authority board’s monthly meeting, and many more people have called and sent letters about their ballooning bills.

The barrage of complaints and concerns prompted Clark County Commissioner Steve Sisolak to issue an unusual apology of sorts: He didn’t understand what he was voting for when he voted for the rate hike earlier this year.

“I was under a totally different impression when we passed this increase,” Sisolak said.

He said he had no idea that the new infrastructure surcharge he helped approve would boost the monthly bills for some businesses, churches and nonprofits by 200 percent or more. He thought most people would have to pay a flat monthly increase of about $5.

If he didn’t know then, he certainly does now…

…Sisolak and others are trying to speed up a planned review of the charge, which was originally supposed to be done as part of a larger planning process over the next year and half by a new citizens committee being assembled.

Sisolak said some water customers may not be able to wait that long.

“What I’m hearing from the business community is they’re not going to make it 18 to 20 months,” he said.

McAnallen said something needs to be done. The business owners he is talking to can scarcely afford the current surcharge, which is slated to last for the next three years. If no other solution is found by 2016, the charge will have to be doubled to cover the authority’s debt load, he said.

Authority officials have acknowledged that the surcharge affects businesses more than residents, but they said the new fee is necessary to pay down roughly $2.5 billion in construction debt and finish funding an $800 million intake being built to keep water flowing to the valley even if Lake Mead continues to shrink.

Such projects used to be paid for with the spoils of growth, namely connection charges from new homes and commercial buildings. When growth stopped, so did the water authority’s primary source of construction money.

It’s not just business owners who are complaining about the surcharge.

While the average single-family home saw its bill go up by about $5, some older homes with larger lots and water lines took a bigger hit.

Lifelong Las Vegas resident Mary Joy Alderman lives in a 60-year-old downtown home that sits on an acre of land served by a 1-inch water meter. She said her bill just jumped to about $36 though she has slashed her monthly water use to around 1,000 gallons – less than a tenth of what the average home consumes – and doesn’t water her landscaping at all…

Did you read that:

“Such projects used to be paid for with the spoils of growth, namely connection charges from new homes and commercial buildings. When growth stopped, so did the water authority’s primary source of construction money.”

Now this falls in line with the analysis that suburbia is one giant Ponzi scheme, as argued here.

Now I want to go back and talk also about one of those heads that belongs on a pike. One of the major problems facing industrial civilization and mankind is the failure to be honest with ourselves. And that problem is compounded when you are not given the facts of your predicament. The captains of industry who benefit from business-as-usual like to keep the public in the dark and brain-washed about free-market capitalism, a dogma that has brought the planet to its knees and the continued existence of the Homo-Sapien species into question. Gina Rinehart, the richest woman in the world, is a case in point:

Addressing a libertarian think-tank in Perth last July, the British climate change sceptic Christopher Monckton urged Australians to create a home-grown version of Rupert Murdoch’s Fox News. The “super-rich”, he said, should invest in the media, install like-minded commentators and give the country “a proper dose of free-market thinking.

Lord Monckton’s visit was part-funded by one of his biggest Australian fans, Gina Rinehart, the multi-billionaire iron ore magnate. A year on, Ms Rinehart – the country’s wealthiest individual – is on the verge of becoming its newest media mogul, a prospect that is sending a chill through newsrooms, boardrooms and the corridors of government…

…Rinehart never gives interviews. But her values – pro-free market, cheap foreign labour and tax concessions for mining, and anti-government regulation, red tape and climate change science – are well known…

“She regards journalists as either socialists or communists,” says Paul Barry, an investigative journalist and author. “Not only does she know nothing about the media business, but she doesn’t understand or sympathise with the media.

“I think she would be considerably worse than Rupert Murdoch as a proprietor, not least because she’s coming into a newspaper [group] with an entirely opposite stance to the one she would like it to take.”

This lady’s mindset sounds almost cartoonish in its prejudice and ideological bent. Firstly, she can’t possibly understand what freedom of the press means other that the dictate of ‘freedom to buy the press’ and convert it into a mouthpiece for her wealth-extraction agenda. Secondly, Mrs Rinehart and her ilk don’t acknowledge the reality that capitalism cannot exist without the ability to pollute freely and externalize as much costs as possible onto the environment and communities in which she does not reside. But as I said in Tuesday’s post, the über wealthy will not be spared from escalating climate chaos. Thirdly, capitalism cannot exist without cheap and plentiful fossil fuels of which we are starting to scrape the bottom of the barrel as evidenced by more extreme and environmentally destructive measures such as tar sands, deep-sea drilling and gas fracking. Fourthly, capitalism depends on infinite growth to survive, as explained here. Euan Mearns talked about the death of capitalism recently at the 2012 ASPO meeting. Jeremy Grantham also sees the problems with capitalism coming down to debt, politics, environmental damage, and inhumanity.

Capitalism ultimately leads to barbarism and heads on a pike for those not willing to face harsh certainties.