Did you know that there are more than 102 million working age Americans that do not have a job? Yes, I know that number sounds absolutely crazy, but it is true. Right now, there are more than 11 million Americans that are considered to be “officially unemployed”, and there are more than 91 millionAmericans that are not employed and that are considered to be “not in the labor force”. When you add those two numbers together, the total is more than 102 million. Overall, the number of working age Americans that do not have a job has increased by about 27 million since the year 2000. But aren’t things getting better? After all, the mainstream media is full of headlines about how “good” the jobs numbers for October were. Sadly, the truth is that the mainstream media is not being straight with the American people. As you will see below, we are in the midst of a long-term unemployment crisis in America, and things got even worse last month.
In this day and age, it is absolutely imperative that people start thinking for themselves. Just because the media tells you that something is true does not mean that it actually is. If unemployment was actually going down, the percentage of the working age population that has a job should actually be going up. As you are about to see, that is simply not the case. The following are 10 facts about the growing unemployment crisis in America that will blow your mind…
#1 The percentage of working age Americans with a job fell to 58.3 percent in October. The lowest that number has been at any point since the year 2000 is 58.2 percent. In other words, there has been absolutely no “jobs recovery”. During the last recession, the civilian employment-population ratio dropped from about 63 percent to below 59 percent and it has stayed there for 50 months in a row. Will the percentage of working age Americans with a job soon drop below the 58 percent mark?…
#2 The U.S. economy lost 623,000 full-time jobs last month. But we are being told to believe that the economy is actually getting “better”.
#3 The number of American women with a job fell by 357,000 during the month of October.
#4 The average duration of unemployment in October 2013 was nearly three times as long as it was in October 2000.
#5 The number of Americans “not in the labor force” increased by an astounding 932,000 during October. In other words, the Obama administration would have us believe that nearly a million people “disappeared” from the U.S. labor force in a single month.
#6 The number of Americans “not in the labor force” has grown by more than 11 million since Barack Obama first entered the White House.
#7 In October, the U.S. labor force participation rate fell from 63.2 percent to 62.8 percent. It is now the lowest that it has been since 1978. Below is a chart which shows how the labor force participation rate has been steadily declining since the year 2000. How can the economy be “healthy” if the percentage of Americans that are participating in the labor force is continually declining?…
#8 If the labor force participation rate was still at the same level it was at when Barack Obama was elected in 2008, the official unemployment rate would be about 11 percent right now.
#9 Even if you are working, that does not mean that you are able to take care of yourself and your family without any help. In fact, approximatelyone out of every four part-time workers in America is living below the poverty line.
#10 In January 2000, there were 75 million working age Americans that did not have a job. Today, there are 102 million working age Americans that do not have a job.
So what are our politicians doing to fix this?
Shouldn’t they be working night and day to solve this crisis?
After all, Barack Obama once made the following promise to the American people…
“But I want you all to know, I will not rest until anybody who’s looking for a job can find one — and I’m not talking about just any job, but good jobs that give every American decent wages and decent benefits and a fair shot at the American Dream.”
Unfortunately, things have not improved since Obama made that promise, but he has found the time to play 150 rounds of golf since he has been president.
Meanwhile, because there aren’t enough jobs, the number of Americans living in poverty continues to grow.
And right now 1.2 million public school students in the United States are homeless. For many more statistics like this, please see my previous article entitled “29 Incredible Facts Which Prove That Poverty In America Is Absolutely Exploding“.
The only thing that most Americans have to offer in the marketplace is their labor. If they can’t find a job, they don’t have any other way to take care of themselves and their families.
The future of the middle class in America depends upon the creation of good jobs. It really doesn’t matter how far the quantitative easing that the Federal Reserve has been doing pumps up the current stock market bubble. The American people were told that “economic stimulus” was the reason for doing all of this reckless money printing, but the percentage of working age Americans with a job is now actually lower than it was four years ago. Quantitative easing has been a complete and total failure in the job creation department, and it is doing a tremendous amount of long-term damage to our financial system.
The really frightening thing is that the Federal Reserve and the federal government have supposedly been doing all they can to try to “create jobs” and they have utterly failed. In fact, this is the first time in the post-World War II era that we have not seen an employment recovery following a recession.
And now the next wave of the economic collapse is rapidly approaching. What that hits us, millions more Americans will lose their jobs.
So the truth is that this is just the beginning of the unemployment crisis in America.
Yes, things are bad now, but soon they will get much worse.
Bloomberg may be in hot water for scuttling an article that “might anger China” as exposed over the weekend, but that was only after winning investigative prizes for its series of reports exposing the epic wealth of China top ruling families in 2012: a topic that has received prominence at a time when the forced wealth redistribution plans of developed and developing nations, usually originated by these same uber-wealthy families, is all the rage. Another country, whose oligarchic wealth had largely escaped press scrutiny, was Iran. At least until today, when in a six month investigation culminating in a three-part report on the assets of the Iranian Supreme Leader Ayatollah Ali Khamenei, Reuters exposed Setad, an Iranian company that manages and sells property on order from the Imam.
In a nutshell, the company has built up its wealth by seizing thousands of properties from Iranian citizens. According to the investigation, Setad’s assets are worth $95 billion – 40 percent more than Iran’s total 2012 oil exports. It is this confiscated “wealth” that has allowed the Iranian clergy, and especially the Ayatollah, to preserve their power over the years.
In a little more than a nutshell, Reuters explains just who Setad is:
Pari Vahdat-e-Hagh ultimately lost her property. It was taken by an organization that is controlled by the most powerful man in Iran: Supreme Leader Ayatollah Ali Khamenei. She now lives alone in a cramped, three-room apartment in Europe, thousands of miles from Tehran.
The Persian name of the organization that hounded her for years is “Setad Ejraiye Farmane Hazrate Emam” – Headquarters for Executing the Order of the Imam. The name refers to an edict signed by the Islamic Republic’s first leader, Ayatollah Ruhollah Khomeini, shortly before his death in 1989. His order spawned a new entity to manage and sell properties abandoned in the chaotic years after the 1979 Islamic Revolution.
Setad has become one of the most powerful organizations in Iran, though many Iranians, and the wider world, know very little about it. In the past six years, it has morphed into a business juggernaut that now holds stakes in nearly every sector of Iranian industry, including finance, oil, telecommunications, the production of birth-control pills and even ostrich farming.
The organization’s total worth is difficult to pinpoint because of the secrecy of its accounts.But Setad’s holdings of real estate, corporate stakes and other assets total about $95 billion, Reuters has calculated. That estimate is based on an analysis of statements by Setad officials, data from the Tehran Stock Exchange and company websites, and information from the U.S. Treasury Department.
Just one person controls that economic empire – Khamenei. As Iran’s top cleric, he has the final say on all governmental matters. His purview includes his nation’s controversial nuclear program, which was the subject of intense negotiations between Iranian and international diplomats in Geneva that ended Sunday without an agreement. It is Khamenei who will set Iran’s course in the nuclear talks and other recent efforts by the new president, Hassan Rouhani, to improve relations with Washington.
Unlike developed nations, where the first priority of the super rich is to flaunt their wealth, Iran’s supreme leader lives a spartan lifestyle and has not been found to abuse the massive monetary holdings of Setad. However, as Reuters points out, “Setad has empowered him. Through Setad, Khamenei has at his disposal financial resources whose value rivals the holdings of the shah, the Western-backed monarch who was overthrown in 1979.”
Logically, the next question is just how did Setad accumulate its vast asset holdings. The answer, just as logically, is simple:confiscation.
How Setad came into those assets also mirrors how the deposed monarchy obtained much of its fortune – by confiscating real estate. A six-month Reuters investigation has found that Setad built its empire on the systematic seizure of thousands of properties belonging to ordinary Iranians: members of religious minorities like Vahdat-e-Hagh, who is Baha’i, as well as Shi’ite Muslims, business people and Iranians living abroad.
Setad has amassed a giant portfolio of real estate by claiming in Iranian courts, sometimes falsely, that the properties are abandoned. The organization now holds a court-ordered monopoly on taking property in the name of the supreme leader, and regularly sells the seized properties at auction or seeks to extract payments from the original owners.
Just like in the US where the 1% effectively have molded the status quo into a wealth preservation mechanism, with profound control over not only the capital markets and the regulatory framework but over all three branches of government (simply note how many bankers have gone to prison for the systemic crash of 2008), so in Iran the Ayatollah has shaped society in a way that will ultimately benefit first and foremost him, as well as not only preserve his wealth but facilitate even greater accumulation of confiscated assets under any and all pretexts.
The supreme leader also oversaw the creation of a body of legal rulings and executive orders that enabled and safeguarded Setad’s asset acquisitions. “No supervisory organization can question its property,” said Naghi Mahmoudi, an Iranian lawyer who left Iran in 2010 and now lives in Germany.
Khamenei’s grip on Iran’s politics and its military forces has been apparent for years. The investigation into Setad shows that there is a third dimension to his power: economic might. The revenue stream generated by Setad helps explain why Khamenei has not only held on for 24 years but also in some ways has more control than even his revered predecessor. Setad gives him the financial means to operate independently of parliament and the national budget, insulating him from Iran’s messy factional infighting.
Like every usurpation of power and wealth, Setad’s beginnings were humble and, to an extent, noble.
When Khomeini, the first supreme leader, set in motion the creation of Setad, it was only supposed to manage and sell properties “without owners” and direct much of the proceeds to charity. Setad was to use the funds to assist war veterans, war widows “and the downtrodden.” According to one of its co-founders, Setad was to operate for no more than two years.
Setad has built schools, roads and health clinics, and provided electricity and water in rural and impoverished areas. It has assisted entrepreneurs in development projects. But philanthropy is just a small part of Setad’s overall operations.
One can probably imagine that the founders of the Fed also had noble intentions. Instead they created a dormant century-old monster, intervening in the economy to preserve the wealth of the American financial oligarchy, and whose wealth-transfer capacity has only emerged on the scene in the past five years. So it is not surprising that as absolute power corrupts absolutely, so it is in Iran as it is in the US:
Under Khamenei’s control, Setad began acquiring property for itself, and kept much of the funds rather than simply redistributing them. With those revenues, the organization also helps to fund the ultimate seat of power in Iran, the Beite Rahbar, or Leader’s House, according to a former Setad employee and other people familiar with the matter. The first supreme leader, Khomeini, had a small staff. To run the country today, Khamenei employs about 500 people in his administrative offices, many recruited from the military and security services.
The full Reuters article, the first of three, has much more detail on the asset holdings of the Setad, on its expropriation strategies, on the cover up to hide the full extent of the organization’s involvement in society, and much more, however the broad strokes will be largely familiar to those acquainted with the tactics of any and every oligarch – be they clergical, political or financial – when preservation of power through wealth and money (and confiscation thereof) is the only prerogative.
And while Iran’s wealth confiscation scheme may be extreme by Western standards, at least it is a honest daylight robbery, but what’s worse is that it pales in comparison to what goes on every month not in some enclave of despotic banana republicanism, but the US itself.
Because putting Setad’s $95 billion in estimated assets in context, these amount to just over 5 weeks of the Fed’s QE, which for those who are not worried about losing their “access journalistic” credentials and are willing to call a spade a spade, is merely asset confiscation and wealth transfer of the most insidious type: one where those whose assets are handed over to the wealthy, are oblivious of what has just happened and are in fact grateful for the privilege of having been robbed under the auspices of the “fairness doctrine” and for the pursuit of the “greater good.”
Maybe this time, it really is different. Maybe life expectancies have grown, and with them, people’s willingness to take on more debt. That would mean house prices could stay up higher than history would suggest.
Maybe interest rates aren’t going back up. If there is no inflationary pressure, either in Canada or in the U.S., there isn’t much reason for central banks to push interest rates back up.
Maybe we’re in for an endless housing boom. Maybe. But if history is still any guide to go by, then folks, it looks like we have one whopper of a housing bubble on our hands. Because just about every single indicator that warns economists of trouble in the housing market is now flashing red.
Investment bank Goldman Sachs and British business paper the Financial Times are the latest to throw in with the “Canada has a housing bubble” crowd. Goldman put out a report last month saying that some parts of Canada are suffering from overbuilding, and given the excess construction, a “price decline can be quite significant.”
Meanwhile, FT declared Monday that Canada’s “property sector is perched precariously at its peak.”
It is well-known that potassium iodide works to protect against damage from radioactive iodine by saturating our body (the thyroid gland, specifically) with harmless iodine, so that our bodies are unable to absorb radioactive iodine from nuclear accidents.
For example, the World Health Organization notes:
The thyroid gland is at particular risk from irradiation from radioactive iodine because the thyroid uses iodine to produce hormones that regulate the body’s metabolism. The thyroid gland does not differentiate between non-radioactive and radioactive iodine.
When taken at the appropriate dosage and within the correct time interval around exposure to radioactive iodine, KI [i.e. potassium iodide] saturates the thyroid gland with stable (non-radioactive) iodine. As a result, radioactive iodine will not be taken up and stored by the thyroid gland.
However, KI only protects against one particular radioactive element, radioactive iodine, which has a half life of only 8.02 days.* That means that the iodine loses half of its radioactivity within 8 days. For example, after the initial Fukushima melt-down, radioactive iodine was found in California kelp.
But the longer-term threat lies elsewhere. As the New York Times noted – in addition to iodine-131 – the big danger is cesium:
Over the long term, the big threat to human health is cesium-137, which has a half-life of 30 years.
At that rate of disintegration, John Emsley wrote in “Nature’s Building Blocks” (Oxford, 2001), “it takes over 200 years to reduce it to 1 percent of its former level.”
It is cesium-137 that still contaminates much of the land in Ukraine around the Chernobyl reactor.
Cesium-137 mixes easily with water and is chemically similar to potassium. It thus mimics how potassium gets metabolized in the body and can enter through many foods, including milk.
The Environmental Protection Agency says that … once dispersed in the environment … cesium-137 “is impossible to avoid.”
Fortunately – while little-known in the medical community – other harmless minerals can help “saturate” our bodies so as to minimize the uptake of other harmful types of radiation.
The U.S. Department of Defense’s Army Medical Department Center and School explained in its book Medical Consequences of Radiological and Nuclear Weapons (Chapter 4):
One of the keys to a successful treatment outcome is to reduce or eliminate the uptake of internalized radionuclides before they can reach the critical organ.
The terms “blocking” or “diluting” agent can, in most cases, be used interchangeably. These compounds reduce the uptake of a radionuclide by saturating binding sites with a stable, nonradioactive element, thereby diluting the deleterious effect of the radioisotope. For example, potassium iodide is the FDA-recommended treatment to prevent radioactive iodine from being sequestered in the thyroid…. Nonradioactive strontium compounds may also be used to block the uptake of radioactive strontium. In addition, elements with chemical properties similar to the internalized radio-nuclide are often used as blocking agents. For example, calcium, and to a lesser extent phosphorus, can be used to block uptake of radioactive strontium.
After the U.S. military conducted above-ground nuclear tests on Bikini Island, scientists found that adding potassium to the soil reduced the uptake of radioactive cesium by the plants:
The first of a series of long-term field experiments was established on Bikini Island during the late 1980s to evaluate potential remediation techniques to reduce the uptake of cesium-137 into plants (Robison and Stone, 1998). Based on these experiments, the most effective and practical method for reducing the uptake of cesium-137 into food crop products was to treat agricultural areas with potassium fertilizer (KCl).
John Harte – Professor at the University of California at Berkeley in Energy and Resources and Ecosystem Sciences, a PhD physicist who previously taught physics at Yale, a recipient of the Pew Scholars Prize, Guggenheim Fellowship, the Leo Szilard prize from the American Physical Society, and who has served on six National Academy of Sciences Committees and has authored over 170 scientific publications, including six books – notes:
Marine fish are usually about 100 times lower in cesium-137 than are freshwater fish because potassium, which is more abundant in seawater, blocks uptake of cesium by marine organisms.
The same is true in mammals. The U.S. Department of Health and Human Services’ Agency for Toxic Substances and Disease Registry notes:
Cesium is a close chemical analogue of potassium. Cesium has been shown to compete with potassium for transport through potassium channels and can also substitute for potassium in activation of the sodium pump and subsequent transport into the cell.
Elimination rates of cesium may be altered by potassium intake. Following the intraperitoneal injection of 137 Cs in rats, a basal diet supplemented with 8–11% potassium resulted in cesium clearance of 60 days compared to about 120 days for rats receiving the unsupplemented basal diet that contained 1% potassium
(Richmond and Furchner 1961). After 20 days on the diets, rats receiving supplemental potassium had body burdens of 137 Cs that were one-half those of the rats not receiving supplemental potassium. This finding shows that supplemental potassium reduces the uptake and increases the elimination of ingested 137 Cs.
Dr. Ingrid Kohlstadt – a medical doctor with a master’s of public health, on the Faculty at the Johns Hopkins Bloomberg School of Public Health, editor of the best-seller Food and Nutrients in Disease Management – says that the same is true for humans:
Plutonium is treated like iron by our bodies. So getting enough iron will help reduce absorption of plutonium. And see this. (Plutonium is a very heavy element, and so normally cannot travel too far. Therefore, adequate iron intake is primarily important for those living in Japan.)
Here are the recommended daily allowances (RDA) for various minerals (data from the U.S. Department of Agriculture):
In addition to these minerals, getting enough of certain vitamins is helpful.
Numerous studies show that Vitamin C helps to protect the body against radiation.
Radiological health expert Daniel Hayes, Ph.D., of the New York City Department of Health and Mental Hygiene suggests that a form of vitamin D could be one of our body’s main protections against damage from low levels of radiation. Writing in the International Journal of Low Radiation, Hayes explains that calcitriol, the active form of vitamin D, may protect us from background radiation and could be used as a safe protective agent before or after a low-level nuclear incident.
“Vitamin D by its preventive/ameliorating actions should be given serious consideration as a protective agent against sublethal radiation injury, and in particular that induced by low-level radiation,” concludes Hayes.
It takes a couple of weeks or months to build up our body’s levels of Vitamin D. You cannot just pop a bunch of pills and raise your Vitamin D level. You should never take more than the recommended dose, and – even if you did – it wouldn’t raise your vitamin D level all at once. As such, we should start now …
Here are the RDAs for vitamins (data from the U.S. Department of Agriculture):
Antioxidant-rich foods also help protect you against low-level radiation. See this for the science behind antioxidant protection from radiation, tips on inexpensive, anti-oxidant rich foods … and other valuable tips on how to protect yourself from radiation.
The bottom line: starting to saturate your body now with the right types of healthy vitamins, minerals and antioxidants can help protect you against radiation if it hits in the future.
Postscript: We only advocate taking the RDA for various nutrients, which is healthy for you anyway. We are not talking about mega-doses.
We have spent hours looking through medical journal articles for other foods which help protect against radiation. Here are the results.
For a more complete discussion of commonly-accepted scientific consensus on different prevention and treatment options, please review the Army’s Medical Consequences of Radiological and Nuclear Weapons and the The American Association of Physicists In Medicine’s Medical Management of Radionuclide Internal Contamination.
* You should not take potassium iodide supplements unless you are exposed to high doses of radioactive iodine, because it can damage some people’s health. These supplements are only for short-term, high-dose ratiation protection, not for years-long low-dose exposure. For long-term exposures, a daily, baseline level of iodine is healthier.
Potassium iodide is found in most common table salt. However, if exposed to air, the iodine content can largely evaporate within a month or so. So store your salt in as air-tight a condition as possible. Also, it is important not to ingest too much potassium iodide, and most of us already get a lot of salt in our diets from processed foods. (The RDA for “sodium” – i.e. salt – is listed in the table above on the RDAs for various minerals)
Here is RDA for iodine:
And here are some iodine-rich foods.
Click here for a discussion by two medical doctors about preventative iodine doses.
Disclaimer: We are not doctors or health professionals, and this should not be taken as medical advice. Nothing contained herein is intended to diagnose or treat any condition.
Dozens died in Sudanese protests against fuel price rises in September [Al Jazeera]
Sudan’s central bank has devalued the Sudanese pound by almost a quarter against the US dollar, the second such move in little over a year as the African country struggles with hard currency shortages.
Sudan’s economy has been in turmoil since South Sudan’s secession in 2011 took away of three-quarters of oil production.
Oil was the driver of the economy and source for dollars needed for food and other essential imports. Sudan produces too little to feed its around 32 million people.
Bidding prices for the Sudanese pound were stated as 5.6871 for one dollar, compared with 4.4 previously, central bank data on Reuters terminals showed on Monday. The official rate was nearer 3 Sudanese pounds to the dollar in 2011.
The central bank has been trying to bridge a ballooning gap with the black market rate where one dollar costs 7.8 Sudanese pounds as import firms struggle to get their hand on hard currency.
The black market rate has become the benchmark for banks and firms.
A central bank official, asking not to be named, said the rate had been already changed in September when the government cut fuel subsides. He did not elaborate.
The subsidy cuts led to mass protests, with dozens of people killed in the capital, Khartoum.
The secretive central bank tends not to announce devaluations, which are embarrassing for the government, which denies there is a shortage of hard currency.
Sudan has sought to offset the loss of southern oil reserves by boosting gold sales, which make up almost 70 percent of exports. But a recent sharp fall of the global gold prices means 2013 revenues will be well below last year’s $2.2 billion.
In these northern climes, this turning into the year’s final quarter feels written in the blood, or at least into the legacy code of culture. The leaves skitter across the streets in an early twilight, chill winds daunt man and dog, the landscape buttons itself up for the long sleep, and human activity moves indoors — including the arduous festivities around the spooky solstice. We take the comfort that we can in all that. But a strange torpor of event attends this year’s turning. In the year’s final happenings, nothing seems to happen, and what little does happen seems not to matter. The world sits with frayed nerves and hears a distant noise, which is the cosmic screw of history turning.
The nation gets over everything without resolving anything — fiscal cliffs, debt ceilings, health care implosions, domestic spying outrages, taper talk jukes, banking turpitudes, the Syria bluster, the Iran nuke deal fake-out. It’s dangerous to live as though there was no such thing as consequence. Societies have a way of reaching a consensus about something without ever stating it outright. The American public has silently agreed to sit on its hands though one more Christmas and after that things shake loose.
What happens, for instance, in the limbo months of ObamaCare ahead, when people either won’t sign in for health insurance, or can’t because of the stupidity of the website design, and the failure of its work-arounds, and the number rises of people falling seriously ill without insurance, and the ludicrously extortionate hospital bills start rolling in and the machinery of bankruptcy and re-po turns the screws on tens of thousands of families — while the insurance company executives spend their 2013 bonus money on Beemers and McMansion additions? There must be some threshold for criticality there, some breaking point that prompts a swindled population to break out its fabled arsenals. Say, somewhere in America a child tragically dies after being hit by a car and three unsuccessful surgeries to try to fix the damage, and thirty days after the funeral, the uninsured dad gets a bill for $416,000? I doubt a society can withstand many insults like that.
Above all, this big nation has failed to reckon the central quandary of our time: the fatal hypertrophy of finance. This ghastly engine of rackets and swindles is the enlarged heart of a dying body politic, and all we know how to do is feed it more monetary Cheez Doodles. This has been going on far longer than the doctors and the witch doctors thought possible, and there is a foolish hope among the credulous that the larger organism of the economy must therefore be immortal. But the reality-based minority stoically awaits the final congestive infarction.
Everything points to 2014 as the moment the pretending stops and things get real. Nobody believes anymore that the Federal Reserve can replace an economy of authentic transactions with promissory notes. There is only one final thing that can happen with the Fed, and that is losing all control over rising interest rates. Janet Yellen is being set up as one of the epic chumps of history, and proof of her academic fecklessness is the mere fact that she accepted the post as Fed chair. She will preside over a fabulous disappearance of wealth in America. The blame for it will be epic, too, but it will not represent any genuine understanding of what happened.
Much is being made of the loneliness of Barack Obama these days. He also occupies a rather tragic niche in history — or the arc of his story at least points that way these days. Right now, it is very hard to tell whether he has been a hostage or a fool. He could have moved to break up the big banks in January of 2009, and any time since then he could have sent a memo to the Department of Justice instructing the prosecutions of financial crime to begin in earnest (or replaced the Attorney General). Didn’t happen. Was he being blackmailed by the likes of Jamie Dimon and Lloyd Blankfein, or did he just not know what was at stake?
The history of Barack Obama will be one long record of omissions to act, not just overt failures. He is the Bartleby the Scrivener of our politics. He “prefers not to….” Hence, the powerful lure of the charismatic figure who is sure to act. Adolf Hitler was very clear about his proposed program in the early 1920s, a decade before he came to power. He spelled it out unmistakably in his speeches and his political testament, Mein Kampf: do away with pain-in-the-ass democracy and destroy the Jews. He couldn’t have put it more plainly. The residual admiration for Hitler among the extreme right-wingers of today derives mainly from the simple fact that the man actually did what he said he would do. You can’t overstate the potential hunger for that sort of thing. The current climate of US politics being Weimar-on-steroids, I’m sure that an American corn-pone Hitler would have huge appeal for a beaten-down citizenry.
The means for such a coup of the zeitgeist are rather frightful now: drone aircraft, computer surveillance, militarized police, a puppet press. It makes thoughtful folks queasy. My bet, though, is that a fascist takeover of the US would end up being as inept and ineffectual as ObamaCare. It is one of the great hidden blessings of our time, actually, that anything organized on the massive scale is doomed to failure. But it is likewise the great mission of our time to prepare to get local and smaller, something we’re not really ready for and certainly not interested in. The intertwining of these dynamics will be the story in the year to come.
The pathological pursuit of economic growth is central to the way in which our societies are run, and forms a major barrier to reaching a sustainable state for humanity. That such growth endangers our very survival by degrading and exhausting the environment upon which we are dependent upon, and per capita wealth above a given amount has been shown to not improve general well-being, is irrelevant to the dominant worldview. In addition, over 200 years of such growth has embedded many institutions and path-dependant infrastructure which provide large inertial forces to any move away from the pathology of growth. The movement to a no growth reality will require fundamental changes to belief systems and social practices, together with wastage or reassignment of significant parts of our path-dependent infrastructure. Such change will be strongly resisted by those that benefit from the status quo, such as the currently powerful and wealthy.
Economic growth, especially growth that is characterized as increases in Gross National Product (GNP)1, does not correlate with improvements in social welfare. Even Simon Kuznets, who is credited with the development of this measure, never intended for GNP to be used as a gauge of overall social welfare, noting that “Distinctions must be kept in mind between quantity and quality of growth, between costs and returns, and between the short and long run. Goals for more growth should specify more growth of what and for what2”. GNP can be better characterized as a measure of market-based expenditures, and does not judge whether a given expenditure increases or decreases social welfare, with expenditures to wage war being judged the same as expenditures to feed the population. It also does not take into account impacts on social and ecological sustainability, such as social breakdown and soil degradation. A number of competing measures have been developed such as the Index for Sustainable Economic Welfare (ISEW)3, the Genuine Progress Indicator (GPI)5, and Gross National Happiness (GNH)6 to correct for the shortcomings in the GNP measure. These measures have had only a limited impact so far though, and GNP still reigns supreme as the hegemonic measure of societal success, as witnessed by the constant references to it (and the related Gross Domestic Product7 measure) by political and economic leaders and the media. A consistent pattern that has been seen is that after a given level of GNP per head, additional growth does not tend to produce increases in these alternate measures8. Also, surveys directly asking people about their level of happiness have tended to show the same breakdown in correlation between GNP increase and improved happiness above a certain level of GNP per head9.
The theoretical and epistemological bases of mainstream economics, of which GNP is an artefact, are challenged by attempts to integrate economic and ecological considerations. These see the economy as being an open system, embedded within the closed system which is earth. In this picture the economy is reliant upon ecological sources for inputs (e.g. raw materials, soil, plants and animals, oxygen), and ecological sinks for waste product outputs (e.g. nitrogen run-off into rivers, carbon dioxide into the air). Mainstream neo-classical economics does not factor in the measurement of such things, generally treating inputs as infinite or infinitely substitutable, and the impact of waste products as unquantifiable “externalities”. As long as the economy was not large in relation to the overall ecology, such shortcomings tended not to matter, but over the past 200 years of exponential growth the economy has become much larger in relation to its ecology. Authors such as Georgescu-Roegen10, Daly11, and Victor12 argue both for a fully integratedEcological Economics (or a Bioeconomics as Georgescu-Roegen prefers), and the acceptance that continued exponential growth threatens the sustainability of human society through the depletion of non-renewable ecological sources, and the overuse of renewable ecological sources and sinks.
These views are reinforced through the study of specific effects of economic growth upon the ecology which humanity relies upon for continued existence. The most studied of the ecological sink issues is Climate Change, caused by the heat trapping gases (predominantly carbon dioxide, but also methane and others) expelled into the atmosphere as a side effect of human economic activity. As scientists have deepened their understanding of the dynamics involved, the resulting ecological changes have been seen to increase in both scale and rapidity with actual events tending to outstrip the models used to predict them13. A number of ecological source issues have also been identifies such as the depletion of non-renewable hydrocarbon fossil fuels14, the long term impact of industrialized agriculture upon food production15, and the over-exploitation of fish stocks16. The “Limits to Growth”17 study commissioned by the Club of Rome in 1972 also captured many such constraints with the viewpoint that human society was close to exceeding the carrying capacity of the earth (which it was judged to have done before the end of that decade18).
With much proof that incremental economic growth above a given point does not increase social welfare, and the many arguments that such growth may also directly imperil the sustainability of human society, it could be expected that calls for “no-growth” or even “de-growth” would have entered general discourse and challenged the hegemony of the growth paradigm. Instead, the current focus of those in power is how to maintain, or even to accelerate, growth rather than to contemplate a post-growth paradigm. What are the factors which hold back our societies from accepting, and embracing, these new pathways to both sustainability and social welfare? If a patient was to ignore such input about her survival and happiness, such resistance could be deemed pathological – a symptom of underlying psychological problems. What are those underlying issues stopping humanity from responding effectively to such input?
The exponential economic growth that has become both an underlying societal assumption, and an overriding imperative for government policy, is a relatively recent phenomenon within the history of human society. The history of human civilization prior to the Eighteenth Century is one of repeated developments of complex societies, followed by repeated collapses of those societies. Morris19developed an index of social development and noted that only three civilizations could be identified as reaching the low 40’s on his index, those of the Song Dynasty, the Roman Empire, and modern civilization. One thousand years separate the first two, and over fifteen hundred years the latter two. As Morris puts it “If someone from Rome or Song China had been transplanted to eighteenth-century London or Beijing he or she would certainly have had many surprises … Yet more, in fact much more would have seemed familiar … Most important of all, though, the visitors from the past would have noticed that although social development was moving higher than ever, the ways people were pushing it up hardly differed from how Romans and Song Chinese had pushed it up.19” The development of complex societies relied upon the production of a surplus of food, and other forms of energy, above that required for basic existence. This surplus allowed for specialized occupations, such as artisans and soldiers, and an increased level of social complexity. Such societies are an “anomaly in history”, having only existed in the last 6,000 years, while “throughout the several million years that recognizable humans are known to have lived, the common political unit was the small, autonomous community”20. The size and complexity of such societies was limited by the available bio-mass (predominantly food, fodder for animals, and wood) and the efficiency of the mammals utilized (humans, horses, oxen etc.) in converting that bio-mass into useful energy. The reality of these limitations can be seem even in the “cradle of democracy”, Ancient Greece, where the freedom and material comfort of a limited number of men was supported by a large cohort of non-citizens, such as slaves and serfs, whose surplus energy could be utilized for the benefit of the few21. Increased complexity can be seen as a problem solving strategy20, with additional available energy as a pre-requisite, through greater levels of differentiation, specialization, and integration. Tainter proposed that the decreasing returns of additional complexity are a fundamental limitation on societal longevity20, as would be a lack of the incremental energy required to support ongoing increases in complexity, and the resultant lack of ability to deal with new challenges.
The utilization of non-renewable hydrocarbon energy sources such as coal, oil, and natural gas within the past 200 years, allowing access to the product of previous historical ecologies, was a discontinuity that allowed human society to escape limitations on its size, complexity, and growth rate. By way of example “Hunter gatherer societies … contain no more than a few dozen distinct social personalities, while modern European censuses recognize 10,000 to 20,000 unique occupational roles, and industrial societies may contain overall more than 1,000,000 different kinds of social personalities”22. This phenomenal increase in societal scale and complexity was highly path dependent, in physical infrastructure, economic configurations, and hegemonic ideology, as human societies evolved to optimize their fit within the new circumstances of greatly enhanced access to energy. This process accelerated in the post-war period as oil, with its high energy density and ease of transport, was increasingly exploited. The outcome is a socio-economic configuration in the industrialized countries which is highly sensitive to the continuous availability of complex interconnections between specialized sub-systems, high quality energy, and ongoing growth. This is reinforced by a ruling ideology which assumes growth as a given, and treats the ongoing accumulation of wealth and physical goods as highly desirable and socially positive.
The sheer scale and complexity of modern industrial societies creates many barriers to fundamental changes. These changes would need to occur at differing scales, and to many heterogeneous sub-systems, with the cascading effects of such changes through the complex adaptive systems which typify modern societies. For example, a rise in the fuel taxes in the United Kingdom in 2000 lead to a blockade of fuel depots by protesting haulage drivers. Within days the UK economy was close to collapse, with supermarkets running out of food and even essential services such as hospitals at risk23. Globalization has greatly increased such issues by both linking multiple industrial societies together and facilitating the industrial development of other societies. Complex systems can be both highly resilient to some changes, and highly reactive to others, depending upon the nature of those changes and amount of resilience within the system. Walker et al. consider that industrialized societies have been actively reducing their resilience through human-induced ecological degradation and the drive for economic efficiency which leads to the elimination of redundant sub-systems and interconnections24. The impact of the latter was shown in the effects of the Japanese earthquake of 2011 and the South East Asian floods of the same year upon global supply chains, as highly integrated just-in-time global delivery processes were severely impacted25. Complex systems can also switch between different stable equilibrium states when a threshold condition of the current equilibrium has been breached, undergoing a “regime shift”24, as with the financial panic and economic recession of the 2008/2009 period. An open question is whether or not the current global industrialized human society has the level of resilience necessary to undergo the fundamental changes necessary for its long term survival without collapsing into a new equilibrium which exhibits a much lower level of social welfare.
Over the past two centuries of plentiful high quality energy very large investments have been made in physical and social infrastructure which may be either invalidated completely, or otherwise greatly diminished in value by a move away from economic growth. The financial system which underpins the functioning of modern economies is one of these, as at its very core is the assumption of exponential growth. The majority of what is counted as financial wealth is actually constituted of claims upon future economic growth, and without such growth such wealth would be shown to be illusory and evaporate. The value of any private corporation is predominantly dependent upon its future profit flows, and the growth of those flows relative to the current period. The higher the rate of growth the higher the company value, hence the lower “price to earnings ratio” (the ratio of the value of a listed company to its current earnings) of low growth companies such as utilities to high growth companies such as new high technology start-ups. Without continued economic growth the ability of a company to grow earnings would be severely constrained, and the realization of this would lead share prices to fall to reflect this new reality. The charging of interest on loans is also dependent upon economic growth as increased economic activity is required to produce the incremental cash flows required to pay back the interest26. The dislocation of the as currently constituted financial system from a cessation of economic growth would be severe, and the effects of such a dislocation would greatly impinge upon society’s ability to both function and make required investments in sustainable alternatives. The very direct effects of financial dislocation upon the real economy were shown during the 2008/2009 financial crisis when global supply chains were temporarily impacted by reductions in international trade finance, resulting in some companies not being able to fund international trade shipments27. From a systems perspective the present financial system can be seen as a positive feedback loop, which when functioning well drives continued growth and when functioning badly enhances systemic collapse. “Reinforcing feedback loops are self-enhancing, leading to exponential growth or to runaway collapse over time. They are found whenever a stock has the capacity to reinforce itself.28” Capital is just such a self-enhancing stock, for example through the payment of interest which can then be reinvested to earn more interest.
The financial system has many of the largest and most powerful corporations in the world within it, all heavily motivated to support the ongoing economic growth which underpins their continued success. The fossil fuel industry, which is dependent upon continued hydro-carbon driven growth also has many of the largest corporations among its ranks. An example is Exxon Mobil, which has annual revenues greater than the GDP of the majority of countries in the world29. The ability of such huge corporations to function effectively is dependent upon the transportation and communication systems made possible by fossil fuel energy. With their free speech rights, power over media organizations through advertizing spend decisions, the ability to directly fund political organizations in many countries (with little or no limits in the United States after Citizens United Supreme Court ruling30), and hire lobbyists, such corporations provide very significant opposition to any movement to reduce growth and/or dependence on fossil fuels. Authors such as Oreskes & Conway31, and Hoggan & Littlemore32 have documented many of the activities used to forestall actions which may be in the public good, but would negatively affect corporate profits and freedom of action. These utilize many of the advanced socio-psychological techniques developed in the early twentieth century by such figures as Edward Bernays33 to create the consumer culture required to drive the increasing levels of demand needed in an age of ever increasing material production facilitated by fossil fuel energy, and to “manufacture consent”33 as a method of social control.
National security strategy, and the ability of a country to affect the policies of other countries for its benefit relies greatly upon relative economic size, with respect to both hard power (i.e. military threats and actual interventions) and soft power (diplomatic, economic sanctions and incentives etc.). The ability to field a significant military presence is dependent upon the ability to generate a large economic surplus which can be utilized to support such non-productive resources, and the respective power positions of countries tend to correlate to relative economic growth over time, as noted by Kennedy34. The ability to project military power is also highly dependent upon liquid fossil-based fuels for the transport and on-going operation of personnel and military equipment. With the post-WW2 proliferation of nuclear weapons limiting the viability of direct military intervention, and the recent recreation of a multi-polar world (i.e. USA, China, and a resurgent Russia), the soft levers of power have come more to the fore35. Thus, both the military and political elites will be heavily committed to continued economic growth, and will see unilateral de-growth as unilateral disarmament and an acceptance of less power relative to, and less ability to protect national interests against, other countries. The centrality of economic power to national security has been expressed publicly by Leslie Gelb35, President of the Council for Foreign Relations which is a highly influential body in the area of national security planning and foreign affairs. The importance of continued access to fossil fuel resources has also been covered by both the influential Project for a New American Century (P.N.A.C.) 36, and the well-connected Brzezinski37.
Military scenario planning for such things as the effects of climate change and fossil fuel dependence do show one possible area where a difference in elite opinion may grow, as the military and national security planning organizations take more account of scientific opinions in these areas38, 39, 40. Insurance corporations also provide another avenue through which elite opinion may be diversifying as they assess the effects of Climate Change upon their future claims and corporate viability41, 42, although the US-based insurance companies seem to be seriously lagging their counterparts in other countries43. It must be remembered though, that all of these efforts are within the paradigm of continued economic growth.
The ideological infrastructure has also been fundamentally affected by the continued exponential growth over the past two centuries. An underlying belief in the efficacy of continued economic growth, together with a near absolute confidence in human ingenuity and technology to overcome any obstacles pervade the dominant capitalist and socialist belief systems. Catton has likened the belief in technology to a “Cargo Cult”, and noted that modern technological advancement depends heavily upon the energy surplus provided by fossil fuels, and while such advances developed new and more efficient ways of utilizing fossil fuel energy they have not developed viable long term replacements for fossil fuels14. Greer also notes the dependence of renewable technologies on a fossil fuel subsidy, with the example of a solar cell “which requires large doses of diesel fuel to mine the raw materials and then ship them to the factory … larger doses of natural gas or coal to generate the electricity <to turn> raw materials into a cell” 44. To this can be added the fossil fuels needs to transport the finished cells, and to install them. The hegemonic economic paradigm of the capitalist economies, “neo-classical economics”, also assumes limitless or infinitely substitutable natural resources. For the vast majority of the past 200 years of exponential growth this was consistent with reality as the human economy was not large enough to appreciably impact the overall ecology. The momentum of exponential growth has quite recently grown the human economy to a scale where it is having significant impacts upon its ecology, but the hegemonic economic paradigm has not caught up with this reality. Areas of research such as Ecological Economics and Bio-Economics, which strive to incorporate the economy within its overall ecology, are still very much on the fringes of economics with little or no impact upon the mainstream. The inability of scientific communities to change paradigms in the face of even overwhelming evidence was noted by Kuhn45, with the eventual change being dependent upon the turnover of leaders within the respective discipline in many cases. With economists being so central to societal decision making processes this provides a major impediment to change. Cognitive Dissonance also provides a blockage to change generally, as individuals are driven to reject information that conflicts with their own beliefs, or those of the groups to which they belong46, and a number of studies have indicated the role of cognitive dissonance in the rejection of the evidence for climate change47, 48.
Industrialized human society is a complex system that has developed through adaptation to the availability of seemingly endless amounts of high quality fossil fuel energy. Two centuries of such adaptation have created a society that has a high level of fitness to its current ecological niche, but with a greatly reduced level of resilience to changed ecological circumstances and highly developed inertial tendencies. The example of a drug addict comes to mind, who knows that continued drug use will kill him but is unable to save himself. Parts of his body crave the drugs, the process of withdrawal is both emotionally and physically painful, and his drug-damaged body may not be able to survive the physical stresses of the withdrawal process. The continued drug use, or in the case of society fossil fuel use and economic growth focus, is truly a pathological, but also a very understandable response. Many organizations have focused on local initiatives in the face of such societal-level inertia and resistance, as with the Transition Town movement pioneered by Rob Hopkins49, but they risk remaining relatively marginalized with little affect on the overall direction of society. Such local initiatives could also be overwhelmed by wider societal problems as ecologically-driven crises intensify, as they are not truly independent of the overall society and its ecology. Another reaction, as with David King (the former United Kingdom Chief Scientific Advisor), is that real change will not happen until the ecologically-driven negative effects are obvious and large enough to overcome societal resistance50. Given the delayed feedback inherent in resource depletion and ecological degradation, together with the non-linear nature of complex systems such as the global ecology, it may very well be too late by then. A greater focus is required on changing the fundamental societal barriers to change, and on producing a competing positive discourse for a society that currently has an “inability to construct a narrative that links to reality”51.
References and Notes
1. Gross National Product (GNP) measures the production of goods and services, which have a market value, of a given geographic area. By definition, this excludes non marketable output such as parent provided childcare, and unpaid care of the elderly by their relatives. It also does not question whether such output is beneficial or not, thus the cost of incarcerating criminals is treated the same as the cost of educating children.
2. Kuznets, Simon (1962), How To Judge Quality, The New Republic: October 20, 1962
3. Index of Sustainable Economic Welfare (ISEW) attempts to provide a measure that corrects for the deficiencies in the GNP measure, and is attributed to Daly and Cobb with their 1989 book “For the Common Good”4. A major part of this is to correct for what Daley sees as uneconomic growth, which encroaches upon ecological and social welfare and can create defensive expenditures required to ameliorate the effects. Examples would be the costs of incarcerating criminals, the cost of commuting long distances to work, the costs of treating people injured in industrial accidents, and the costs of ameliorating the effects of anthropogenic climate change. The ISEW measure starts with the total of market purchased private consumption expenditures, and then deducts such defensive expenditures, together with measures of environmental degradation and depreciation. Non-market services, such as those provided by public capital such as public libraries, and household and volunteer services, are also calculated and added to this measure. This measure does assume a “weak sustainability” paradigm, where reductions in natural capital can be substituted for with increases in social and economic capital.
4. Daly, Hermann & Cobb, John (1989), For the Common Good, Beacon Press
5. Genuine Progress Indicator (GPI) varies in some details from the ISEW, but is not substantially different.
6. There is no standard quantitative definition of the Gross National Happiness (GNH) measure, which was first developed in Bhutan as a way of directly measuring social welfare rather than indirectly as such measures of GNP, and the ISEW and GPI do. Through surveys the following are measured: psychological wellbeing, time use, community vitality, cultural diversity, ecological resilience, living standards, health, education, and good governance. These measures are then aggregated to provide the overall GNH level (see http://www.grossnationalhappiness.com/wp-content/uploads/2012/04/Short-GNH-Index-final1.pdf for more details). This has been adapted for more general use, in some cases using already collected data rather than questionnaires, with the GNH being measured for many countries.
7. Gross Domestic Product (GDP) measures the local economy, rather than all output attributable to inhabitants of a given geographic area and differs from GNP in that it does not include measures of net income from sources outside the geographic area (earnings by residents from abroad minus earnings by foreign nationals from the geographic area). GNP will tend to be higher than GDP for net external creditors, and lower for net external debtors.
8. Anielski, Mark (2007), The Economics of Happiness: Building Genuine Wealth, New Society Publishers
9. Layard, Richard (2005), Happiness: Lessons From a New Science, Penguin Press
10. Georgescu-Roegen, Nicolas & Bonaiuti, Mauro (2011), From Bioeconomics to Degrowth: Georgescu-Roegen’s ‘New Economics’ in Eight Essays, Routledge
11. Daly, Herman (1996), Beyond Growth, Beacon Press
12. Victor, Peter (2008), Managing Without Growth, Edward Elgar Publishing
13. Hansen, James (2009), Storms of My Grandchildren: The Truth About the Coming Climate Catastrophe and Our Last Chance to Save Humanity, Bloomsbury USA
14. Catton, William (1982), Overshoot, Illinois Books
15. Roberts, Paul (2008), The End of Food, Houghton Mifflin
16. Ellis, Richard (2003),The Empty Ocean, Island Press
17. Meadows, Meadows, Randers & Behrens (1972), Limits to Growth, Signet
18. Meadows, Randers, & Meadows (2004), Limits to Growth: The 30-Year Update, Chelsea Green
19. Morris, Ian (2011), Why the West Rules – For Now: The Patterns of History and What They Reveal about the Future, McClelland & Stewart
20. Tainter, Joseph (1988), The Collapse of Complex Societies, Cambridge University Press
21. Euben, Ober & Wallch (1994), Athenian Political Thought and the Reconstruction of American Democracy, Cornell University Press
22. Costanza, Sequra & Martinez-Alier (1996), Getting Down To Earth: Practical Applications of Ecological Economics, Island Press
23. N/A (2005), Impact of September 2000 Fuel Price Protests on UK Critical Infrastructure, Public Safety Canada. Accessed on July 22nd, at ttp://www.publicsafety.gc.ca/prg/em/ccirc/2005/ia05-001-eng.aspx
24. Walker, Brian & Salt, David (2006), Resilience Thinking: Sustaining Ecosystems and People in a Changing World, Island Press
25. Yang, Jun (2011), Worst Thai Floods in 50 Years Hit Apple, Toyota Supply Chain, Bloomberg. Accessed on July 24th 2012, at http://www.bloomberg.com/news/2011-10-20/worst-thai-floods-in-50-years-hit-apple-toyota-supply-chains.html
26. Keen, Steve (2011), Debunking Economics – Revised and Expanded Edition: The Naked Emperor Dethroned?, Zed Books
27. Coulibaly, Sapriza, Zlate (2011), Trade Credit and International Trade during the 2008-09 Global Financial Crisis, Board of Governors of the Federal Reserve System: International Finance Discussion Papers, Number 1020, June 2011
28. Meadows, Donella (2008), Thinking In Systems: A Primer, Chelsea Green Publishing
29. Coll, Steve (2012), Private Empire: Exxon Mobil and American Power, Penguin Press
30. Blumenthal, Paul (2012), Citizens United Constitutional Amendment Floated By Senate Democrats, Huffington Post. Accessed on July 26th athttp://www.huffingtonpost.com/2012/07/24/citizens-united-constitutional-amendment-senate-democrats_n_1700269.html
31. Oreskes, Naomi & Conway, Erik (2010), Merchants of Doubt: How a Handful of Scientists Obscured the Truth from Tobacco Smoke to Global Warming, Bloomsbury Press
32. Hoggan, James & Littlemore, Richard (2009), Climate Cover Up: The Crusade to Deny Global Warming, Greystone Books
33.Bernays, Edward (2004), Propoganda, Ig Publishing
34. Kennedy, Paul (1989), The Rise and Fall of the Great Powers, Vintage
35. Gelb, Leslie (2010), GDP Now Matters More Than Force: A U.S. Foreign Policy for the Age of Economic Power, Foreign Affairs November/December 2010
37. Brzezinski, Zbigniew (2007), The Great Chessboard: American Primacy and its Geostrategic Imperatives
38. Gartner, John (2012), US Military Not Retreating on Clean Energy, Forbes
Accessed on July 26th, 2012 athttp://www.forbes.com/sites/pikeresearch/2012/05/11/u-s-military-not-retreating-on-clean-energy/
39. Hirsch, Bezdek & Wendling (2005), Peaking of World Oil Production: Impacts, Mitigation & Risk Management, Science Applications International Corporation (S.A.I.C.). Accessed on July 26th, 2012 athttp://www.netl.doe.gov/publications/others/pdf/Oil_Peaking_NETL.pdf
40. Boykoff, Jules (2011), US military goes to war with climate sceptics, The Guardian. Accessed on July 26th, 2012 athttp://www.guardian.co.uk/commentisfree/cifamerica/2011/may/20/climate-change-climate-change-scepticism
41. N/A (2012), Climate change concerns raised by insurance industry, Canadian Broadcasting Company. Accessed on July 26th, 2012 at http://www.cbc.ca/news/canada/new-brunswick/story/2012/02/23/nb-climate-change-insurance-836.html
42. Boykoff, Jules (20110, Why the Insurance Industry get climate change, The Guardian. Accessed on July 26th, 2012 at http://www.guardian.co.uk/commentisfree/cifamerica/2011/jun/28/climate-change-climate-change-scepticism
43. Schiller, Ben (2012), Insurance Companies face Increased Risks from Warming, Yale University. Accessed on July 26th, 2012 athttp://e360.yale.edu/feature/insurance_companies_face_increased_risks_from_warming/2519/
44. Greer, John Michael (2008), The Long Descent: A User’s Guide to the End of the Industrial Age, New Society Publishers
45. Kuhn, Thomas (2012), The Structure of Scientific Revolutions: 50th Anniversary Edition, University of Chicago Press
46. Cooper, Joel (2007), Cognitive Dissonance: 50 Years of a Classic Theory, Sage Publications
47. Kahan et al. (2012), The polarizing impact of science literacy and numeracy on perceived climate change risks, Nature Climate Change
48. Lorenzoni, Nicholson-Cole & Whitmarsh (2007), Barriers perceived to engaging with climate change among the UK public and their policy implications, Global Environmental Change 17 (2007) 445-449
49. Hopkins, Rob (2008), The Transition Handbook: From Oil Dependency to Local Resilience, Chelsea Green
50. Witnessed by the author during a panel discussion at the “Planet Under Peril” conference in London, United Kingdom, March 26-29, 2012.
51. Kunstler, James (2012), Too Much Magic: Wishful Thinking, Technology, and the Fate of the Nation, Atlantic Monthly Press
The global currency wars are heating up again as central banks embark on a new round of easing to combat a slowdown in growth.
The European Central Bank cut its key rate last week in a decision some investors say was intended in part to curb the euro after it soared to the strongest since 2011. The same day, Czech policy makers said they were intervening in the currency market for the first time in 11 years to weaken the koruna. New Zealand said it may delay rate increases to temper its dollar, and Australia warned the Aussie is “uncomfortably high.”
A customer selects two hundred denomination Czech koruna currency notes from her wallet in Prague, Czech Republic. Photographer: Martin Divisek/Bloomberg
Nov. 11 (Bloomberg) — Sean Callow, a senior currency strategist at Westpac Banking Corp. in Sydney, talks about the U.S. and the Australian dollars, and global trading strategy. He speaks with Rishaad Salamat on Bloomberg Television’s “On the Move.” (Source: Bloomberg)
Nov. 11 (Bloomberg) — Peter Rosenstreich, head of market strategy at Swissquote Bank SA, talks about the outlook for the Australian dollar and the U.S. dollar. He spoke Nov. 8 from Geneva. (Source: Bloomberg)
A pedestrian passes advertisements for koruna currency coins in Prague. The Czech National Bank drove its koruna down by 4.4 percent versus the euro on Nov. 7, the most since the single currency’s creation in 1999, when it intervened to spur inflation. Photographer: Bartek Sadowski/Bloomberg
The moves threaten to spark a new round in what Brazil Finance Minister Guido Mantega, seen here, in 2010 called a “currency war,” barely two months after the Group of 20 nations pledged to “refrain from competitive devaluation.” Photographer: Peter Foley/Bloomberg
“It’s a very real concern of these countries to keep their currencies weak,” Axel Merk, who oversees about $450 million of foreign exchange as the head of Palo Alto, California-based Merk Investments LLC, said in a Nov. 8 telephone interview. ECB President Mario Draghi, “persistently since earlier this year, has been trying to talk down the euro,” Merk said.
With the outlook for the global economy being downgraded by the International Monetary Fund and inflation slowing to levels that may hinder investment, countries and central banks are revisiting policies that tend to boost competitiveness through weaker currencies.
The moves threaten to spark a new round in what Brazil Finance Minister Guido Mantega in 2010 called a “currency war,” barely two months after the Group of 20 nations pledged to “refrain from competitive devaluation.”
“We’re seeing a new era of currency wars,” Neil Mellor, a foreign-exchange strategist at Bank of New York Mellon in London, said in a Nov. 8 telephone interview.
The ECB lowered its benchmark rate on Nov. 7 by a quarter-point to a record 0.25 percent, a reduction anticipated by just three of 70 economists in a Bloomberg survey. Draghi said the cut was to reduce the risk of a “prolonged period” of low inflation and the euro’s strength “didn’t play any role” in the decision. Euro-region consumer-price inflation has remained below the ECB’s 2 percent ceiling for the past nine months.
The euro slumped as much as 1.6 percent against the dollar on the day of the rate cut, the most in almost two years, before ending the week at $1.3367. It rose 0.2 percent today to $1.3390 at 10:01 a.m. in London.
The shared currency pared gains versus a basket of nine developed-market peers this year to 5.6 percent, from as much as 7.2 percent at its Oct. 29 peak, Bloomberg Correlation-Weighted Indexes show.
“There are places in the world where economies are generally quite weak, where inflation is already low,” Alan Ruskin, global head of Group-of-10 foreign exchange in New York at Deutsche Bank AG, the world’s largest currency trader, said in a Nov. 8 phone interview. “Japan was in that mix for 20-odd years. Nobody wants to go there” and “the talk from Draghi shows they’re taking the disinflation story very seriously. The Czech Republic is the same story.”
The Czech National Bank’s drove its koruna down by 4.4 percent versus the euro on Nov. 7, the most since the single currency’s creation in 1999, when it intervened to spur inflation. Governor Miroslav Singerpledged to keep selling koruna “for as long as needed” to boost growth.
The IMF last month cut its forecast for global economic growth to 2.9 percent in 2013 and 3.6 percent in 2014, from July’s projected rates of 3.1 percent and 3.8 percent. It also sees inflation in developed economies remaining short of the 2 percent rate favored by most central banks.
Growth in global trade may slow to 2.5 percent in 2013, the new head of the World Trade Organization said after a Sept. 5-6 summit of G-20 nations in St. Petersburg, Russia, down from the organization’s previous estimate in April of 3.3 percent. Even so, the G-20 participants agreed to “refrain from competitive devaluation” and not “target our exchange rates for competitive purposes.”
“The idea that central banks are setting policies to weaken their currencies has always been overstated,” Adam Cole, Royal Bank of Canada’s head of G-10 currency strategy in London, said in a Nov. 8 phone interview. “In most cases they’re happy to see their currencies fall, but they’re not going out of their way to induce weakness.”
German airline Deutsche Lufthansa AG cited the strong euro last month when its profit estimate fell short of analysts’ forecasts, while French luxury-goods maker LVMH Moet Hennessy Louis Vuitton SA said on Oct. 16 that the currency’s gains versus the dollar and Japanese yen shaved 6 percent off third-quarter revenue.
Lufthansa said on Oct. 22 this year’s operating profit will be 600 million euros to 700 million euros, below an estimate of about 918 million euros by analysts surveyed by Bloomberg.LVMH, whose Louis Vuitton brand’s founder built his reputation as a luggage-maker for the wife of Napoleon III, said it has hedged 90 percent of its euro-yen exposure for this year and about 66 percent for next year.
“Do I think the euro-zone central bank wanted to engage in a currency war?” Lane Newman, a director of foreign exchange at ING Groep NV in New York, said in a Nov. 8 phone interview. “I think, post facto, yes. Because they cut rates knowing it was going to put the euro on the back foot.”
While the ECB hasn’t said it’s explicitly targeting the euro, comments from policy makers signal they consider exchange rates in their decisions. An ECB spokesman declined to comment when contacted on Nov. 8.
“As you know, the exchange rate is not a policy target for the ECB,” Draghi said at a press conference on Oct. 2. “The target for the ECB is medium-term price stability. However, the exchange rate is important for growth and for price stability. And we are certainly attentive to these developments.”
At the same time the ECB is easing, the U.S. Federal Reserve said it will keep printing enough dollars to buy $85 billion of bonds each month because the economy is still too weak to stand on its own. The Bank of Japan is also employing a policy of quantitative easing.
Reserve Bank of New Zealand Governor Graeme Wheeler has cited the risk of slow inflation and currency gains as reasons for not raising the nation’s official cash rate from a record-low 2.5 percent this year. That’s even with the need to tackle what he has described as an overheated housing market. The kiwi rose 4.5 percent in the past four months, Bloomberg Correlation Indexes show.
Australia’s dollar is 27 percent overvalued against the greenback, according to a gauge of purchasing-power parity compiled by the Paris-based Organization for Economic Cooperation and Development.
The Reserve Bank of Australia lowered its growth estimate for next year to 2 percent to 3 percent, compared with 2.5 percent to 3.5 percent three months ago. South Korea’s finance ministry said last month it may act to counter “herd behavior” in the currency, as the Bank of Korea lowered its outlook for the economy.
The Fed said in October it needed to see more evidence of a U.S. recovery before it trims the Treasury and mortgage-bond purchases it uses to pump money into the financial system.
Analysts surveyed by Bloomberg last week predicted the Fed would delay tapering until March even though a Labor Department report on Nov. 8 showing employers added a larger-than-forecast 204,000 workers in October.
“People aren’t as content as they once were about being on the end of dollar weakness, and hence an appreciation of their own currencies,” Bank of New York’s Mellor said. “We’ve had a change in tone from South Korea, Australia and New Zealand.”
Naomi Klein: Why Science Is Telling All of Us to Revolt and Change Our Lives Before We Destroy the Planet | Alternet
But it was Werner’s own session that was attracting much of the buzz. It was titled “Is Earth F**ked?” (full title: “Is Earth F**ked? Dynamical Futility of Global Environmental Management and Possibilities for Sustainability via Direct Action Activism”).
Standing at the front of the conference room, the geophysicist from the University of California, San Diego walked the crowd through the advanced computer model he was using to answer that question. He talked about system boundaries, perturbations, dissipation, attractors, bifurcations and a whole bunch of other stuff largely incomprehensible to those of us uninitiated in complex systems theory. But the bottom line was clear enough: global capitalism has made the depletion of resources so rapid, convenient and barrier-free that “earth-human systems” are becoming dangerously unstable in response. When pressed by a journalist for a clear answer on the “are we f**ked” question, Werner set the jargon aside and replied, “More or less.”
There was one dynamic in the model, however, that offered some hope. Werner termed it “resistance” – movements of “people or groups of people” who “adopt a certain set of dynamics that does not fit within the capitalist culture”. According to the abstract for his presentation, this includes “environmental direct action, resistance taken from outside the dominant culture, as in protests, blockades and sabotage by indigenous peoples, workers, anarchists and other activist groups”.
Serious scientific gatherings don’t usually feature calls for mass political resistance, much less direct action and sabotage. But then again, Werner wasn’t exactly calling for those things. He was merely observing that mass uprisings of people – along the lines of the abolition movement, the civil rights movement or Occupy Wall Street – represent the likeliest source of “friction” to slow down an economic machine that is careening out of control. We know that past social movements have “had tremendous influence on . . . how the dominant culture evolved”, he pointed out. So it stands to reason that, “if we’re thinking about the future of the earth, and the future of our coupling to the environment, we have to include resistance as part of that dynamics”. And that, Werner argued, is not a matter of opinion, but “really a geophysics problem”.
Plenty of scientists have been moved by their research findings to take action in the streets. Physicists, astronomers, medical doctors and biologists have been at the forefront of movements against nuclear weapons, nuclear power, war, chemical contamination and creationism. And in November 2012,Nature published a commentary by the financier and environmental philanthropist Jeremy Grantham urging scientists to join this tradition and “be arrested if necessary”, because climate change “is not only the crisis of your lives – it is also the crisis of our species’ existence”.
Some scientists need no convincing. The godfather of modern climate science, James Hansen, is a formidable activist, having been arrested some half-dozen times for resisting mountain-top removal coal mining and tar sands pipelines (he even left his job at Nasa this year in part to have more time for campaigning). Two years ago, when I was arrested outside the White House at a mass action against the Keystone XL tar sands pipeline, one of the 166 people in cuffs that day was a glaciologist named Jason Box, a world-renowned expert on Greenland’s melting ice sheet.
“I couldn’t maintain my self-respect if I didn’t go,” Box said at the time, adding that “just voting doesn’t seem to be enough in this case. I need to be a citizen also.”
This is laudable, but what Werner is doing with his modelling is different. He isn’t saying that his research drove him to take action to stop a particular policy; he is saying that his research shows that our entire economic paradigm is a threat to ecological stability. And indeed that challenging this economic paradigm – through mass-movement counter-pressure – is humanity’s best shot at avoiding catastrophe.
That’s heavy stuff. But he’s not alone. Werner is part of a small but increasingly influential group of scientists whose research into the destabilisation of natural systems – particularly the climate system – is leading them to similarly transformative, even revolutionary, conclusions. And for any closet revolutionary who has ever dreamed of overthrowing the present economic order in favour of one a little less likely to cause Italian pensioners to hang themselves in their homes, this work should be of particular interest. Because it makes the ditching of that cruel system in favour of something new (and perhaps, with lots of work, better) no longer a matter of mere ideological preference but rather one of species-wide existential necessity.
Leading the pack of these new scientific revolutionaries is one of Britain’s top climate experts, Kevin Anderson, the deputy director of the Tyndall Centre for Climate Change Research, which has quickly established itself as one of the UK’s premier climate research institutions. Addressing everyone from the Department for International Development to Manchester City Council, Anderson has spent more than a decade patiently translating the implications of the latest climate science to politicians, economists and campaigners. In clear and understandable language, he lays out a rigorous road map for emissions reduction, one that provides a decent shot at keeping global temperature rise below 2° Celsius, a target that most governments have determined would stave off catastrophe.
But in recent years Anderson’s papers and slide shows have become more alarming. Under titles such as “Climate Change: Going Beyond Dangerous . . . Brutal Numbers and Tenuous Hope”, he points out that the chances of staying within anything like safe temperature levels are diminishing fast.
With his colleague Alice Bows, a climate mitigation expert at the Tyndall Centre, Anderson points out that we have lost so much time to political stalling and weak climate policies – all while global consumption (and emissions) ballooned – that we are now facing cuts so drastic that they challenge the fundamental logic of prioritising GDP growth above all else.
Anderson and Bows inform us that the often-cited long-term mitigation target – an 80 per cent emissions cut below 1990 levels by 2050 – has been selected purely for reasons of political expediency and has “no scientific basis”. That’s because climate impacts come not just from what we emit today and tomorrow, but from the cumulative emissions that build up in the atmosphere over time. And they warn that by focusing on targets three and a half decades into the future – rather than on what we can do to cut carbon sharply and immediately – there is a serious risk that we will allow our emissions to continue to soar for years to come, thereby blowing through far too much of our 2° “carbon budget” and putting ourselves in an impossible position later in the century.
Which is why Anderson and Bows argue that, if the governments of developed countries are serious about hitting the agreedupon international target of keeping warming below 2° Celsius, and if reductions are to respect any kind of equity principle (basically that the countries that have been spewing carbon for the better part of two centuries need to cut before the countries where more than a billion people still don’t have electricity), then the reductions need to be a lot deeper, and they need to come a lot sooner.
To have even a 50/50 chance of hitting the 2° target (which, they and many others warn, already involves facing an array of hugely damaging climate impacts), the industrialised countries need to start cutting their greenhouse-gas emissions by something like 10 per cent a year – and they need to start right now. But Anderson and Bows go further, pointing out that this target cannot be met with the array of modest carbon pricing or green-tech solutions usually advocated by big green groups. These measures will certainly help, to be sure, but they are simply not enough: a 10 per cent drop in emissions, year after year, is virtually unprecedented since we started powering our economies with coal. In fact, cuts above 1 per cent per year “have historically been associated only with economic recession or upheaval”, as the economist Nicholas Stern put it in his 2006 report for the British government.
Even after the Soviet Union collapsed, reductions of this duration and depth did not happen (the former Soviet countries experienced average annual reductions of roughly 5 per cent over a period of ten years). They did not happen after Wall Street crashed in 2008 (wealthy countries experienced about a 7 per cent drop between 2008 and 2009, but their CO2 emissions rebounded with gusto in 2010 and emissions in China and India had continued to rise). Only in the immediate aftermath of the great market crash of 1929 did the United States, for instance, see emissions drop for several consecutive years by more than 10 per cent annually, according to historical data from the Carbon Dioxide Information Analysis Centre. But that was the worst economic crisis of modern times.
If we are to avoid that kind of carnage while meeting our science-based emissions targets, carbon reduction must be managed carefully through what Anderson and Bows describe as “radical and immediate de-growth strategies in the US, EU and other wealthy nations”. Which is fine, except that we happen to have an economic system that fetishises GDP growth above all else, regardless of the human or ecological consequences, and in which the neoliberal political class has utterly abdicated its responsibility to manage anything (since the market is the invisible genius to which everything must be entrusted).
So what Anderson and Bows are really saying is that there is still time to avoid catastrophic warming, but not within the rules of capitalism as they are currently constructed. Which may be the best argument we have ever had for changing those rules.
In a 2012 essay that appeared in the influential scientific journal Nature Climate Change, Anderson and Bows laid down something of a gauntlet, accusing many of their fellow scientists of failing to come clean about the kind of changes that climate change demands of humanity. On this it is worth quoting the pair at length:
. . . in developing emission scenarios scientists repeatedly and severely underplay the implications of their analyses. When it comes to avoiding a 2°C rise, “impossible” is translated into “difficult but doable”, whereas “urgent and radical” emerge as “challenging” – all to appease the god of economics (or, more precisely, finance). For example, to avoid exceeding the maximum rate of emission reduction dictated by economists, “impossibly” early peaks in emissions are assumed, together with naive notions about “big” engineering and the deployment rates of low-carbon infrastructure. More disturbingly, as emissions budgets dwindle, so geoengineering is increasingly proposed to ensure that the diktat of economists remains unquestioned.
In other words, in order to appear reasonable within neoliberal economic circles, scientists have been dramatically soft-peddling the implications of their research. By August 2013, Anderson was willing to be even more blunt, writing that the boat had sailed on gradual change. “Perhaps at the time of the 1992 Earth Summit, or even at the turn of the millennium, 2°C levels of mitigation could have been achieved through significant evolutionary changes within the political and economic hegemony. But climate change is a cumulative issue! Now, in 2013, we in high-emitting (post-)industrial nations face a very different prospect. Our ongoing and collective carbon profligacy has squandered any opportunity for the ‘evolutionary change’ afforded by our earlier (and larger) 2°C carbon budget. Today, after two decades of bluff and lies, the remaining 2°C budget demands revolutionary change to the political and economic hegemony” (his emphasis).
We probably shouldn’t be surprised that some climate scientists are a little spooked by the radical implications of even their own research. Most of them were just quietly doing their work measuring ice cores, running global climate models and studying ocean acidification, only to discover, as the Australian climate expert and author Clive Hamilton puts it, that they “were unwittingly destabilising the political and social order”.
But there are many people who are well aware of the revolutionary nature of climate science. It’s why some of the governments that decided to chuck their climate commitments in favour of digging up more carbon have had to find ever more thuggish ways to silence and intimidate their nations’ scientists. In Britain, this strategy is becoming more overt, with Ian Boyd, the chief scientific adviser at the Department for Environment, Food and Rural Affairs, writing recently that scientists should avoid “suggesting that policies are either right or wrong” and should express their views “by working with embedded advisers (such as myself), and by being the voice of reason, rather than dissent, in the public arena”.
If you want to know where this leads, check out what’s happening in Canada, where I live. The Conservative government of Stephen Harper has done such an effective job of gagging scientists and shutting down critical research projects that, in July 2012, a couple thousand scientists and supporters held a mock-funeral on Parliament Hill in Ottawa, mourning “the death of evidence”. Their placards said, “No Science, No Evidence, No Truth”.
But the truth is getting out anyway. The fact that the business-as-usual pursuit of profits and growth is destabilising life on earth is no longer something we need to read about in scientific journals. The early signs are unfolding before our eyes. And increasing numbers of us are responding accordingly: blockading fracking activity in Balcombe; interfering with Arctic drilling preparations in Russian waters (at tremendous personal cost); taking tar sands operators to court for violating indigenous sovereignty; and countless other acts of resistance large and small. In Brad Werner’s computer model, this is the “friction” needed to slow down the forces of destabilisation; the great climate campaigner Bill McKibben calls it the “antibodies” rising up to fight the planet’s “spiking fever”.
It’s not a revolution, but it’s a start. And it might just buy us enough time to figure out a way to live on this planet that is distinctly less f**ked.
I began reading Dimitry Orlov’s recent publication, The Five Stages of Collapse: Survivors’ Toolkit, last week and it has got me thinking about his thesis with respect to the revelations around the U.S. surveillance system being used globally by the-powers-that-be (both corporate and political), in combination with the ongoing exposure of manipulation of various markets and interest rates.
Orlov argues that the five stages of collapse
Serve as mental milestones…[and each breaches] a specific level of trust or faith in the status quo. Although each stage causes physical, observable changes in the environment, these can be gradual, while the mental flip is generally quite swift.
Here are his five stages:
- Financial collapse where faith in risk assessment and financial guarantees is lost (think Cyprus).
- Commercial collapse that witnesses a breakdown in trade and widespread shortages of necessities (think Greece).
- Political collapse through a loss of political class relevance and legitimacy (think current events almost everywhere).
- Social collapse in which social institutions that could provide resources fail (coming to a locality near you?).
- Cultural collapse that is exhibited by the disbanding of families into individuals competing for scarce resources (hopefully we never witness this).
Stage one: Financial collapse
Orlov states “all that is required for financial collapse is for certain assumptions about the future to be invalidated, for finance is not a physical system but a mental construct.” It would appear that we are well into this first stage as more and more people are questioning not only the stability of the financial system, but its very structure and long-term viability.
The subprime mortgage crisis of 2008 has left lingering concerns about the fragility of the global economic system. Add to this the ongoing manipulation of global interest rates and markets that has been exposed (see this). This manipulation has little to do with improving a system for the majority but has a lot to do with enriching the elite minority and transferring wealth to them from the majority (see this and this). Add to this the ever-increasing liquidity injections (i.e. money printing) by the world’s central banks (see this) and the theft of allocated funds by unprosecuted criminals (see this) and we have a recipe for increased loss of trust throughout the global financial system. In fact, there are many who have already lost complete faith in the system and recommend disinvesting one’s savings from these corrupt institutions and investing in hard assets (i.e. gold, silver, agricultural land, art, memorabilia, farming supplies, wine, etc.) that maintain or increase their value over time relative to the government-mandated fiat currency which loses its worth due to central bank malfeasance-inflation (see this and this).
Stage two: Commercial collapse
A breakdown in trade is beginning as more and more sovereign nations impose tariffs and/or devalue their currency in a vicious circle: currency devaluation leads to increase in exports for the “devaluer” but a decrease for competitors-it’s a zero sum game after all); the competitor either devalues their currency in kind (see this and this) or imposes tariffs on the nation engaging in purposeful devaluation (see this).
In Greece, a peripheral nation within the Eurozone and a test case for extreme austerity, this type of collapse has occurred in regions, resulting in shortages of necessities such as pharmaceuticals, energy, and food (see this and this).
Stage three: Political collapse
I believe we have begun down this path with evermore revelations of government malfeasance. The latest salvo in this ongoing struggle between what we are told by our governments and what is the on-the-ground reality has been launched: the National Security Agency’s decade-plus invasion of privacy through a global surveillance regime. It’s bad enough that the elite have lied about this for more than a decade; what’s worse is their targeting of whistle blowers as traitors as this discourages exposing immoral or illegal acts perpetrated by our elite.
We are moving ever closer to Orwell’s vision of a totalitarian world as expressed in his book 1984. One commentator has argued that 1984 was not designed to be an instruction manual but a warning, and others have been warning about this type of intrusion for some years.
There are numerous examples of political malfeasance and corruption being uncovered recently. For example:
- The mayor of Toronto videotaped participating with others smoking crack cocaine;
- The U.S. National Security Agency’s creation of a global, electronic surveillance state-apparently even used to eavesdrop on other nations’ leaders at meetings;
- The mayor of Montreal arrested for corruption;
- Numerous former presidents/prime ministers/etc. being arrested/charged for various crimes from torture to murder (see this, this, this, and this)
- The current and former premier of Ontario being linked to decisions cancelling gas plants to save political seats during an election.
Using Orlov’s framework to interpret these concerns, arguments, perspectives, and facts, it would appear that trust and faith in the various systems are collapsing at an incredible rate. Faith in the financial system is crumbling; commercial enterprises, especially multinational corporations, are losing support and trade barriers are beginning to be erected; and, finally, all that is needed for political collapse is for more citizens to come to the realization that the status quo is no longer working for the benefit of all but for the benefit of the elite. When the masses finally come to better understand the corruption and malfeasance that percolates throughout the political world, collapse of the political class will occur.
However, even given the various signs that the system is on the verge of collapse, it is important to realize that no one can predict when this might occur. It could be tomorrow, next week, next year, or next decade…one never knows what event, minor or major, could spin us in an unexpected direction. Learn how to protect yourself and your family financially, socially, and practically (i.e., survival skills) to be in a better position to adapt to the coming changes.
This article was originally published on the Olduvai Blog: Musings on the Coming Collapse.