Wednesday, July 25, 2012

The Upside of Default

Writing The Archdruid Report has its pleasures, and one of them is the wry amusement to be had when some caustic jab of mine turns into an accurate prediction of the future.  Longtime readers may recall a comment of mine late last year to the effect that ordinary investors would surely find some way to pile into the shale gas bubble before the next year was out. Thanks to an anonymous reader and the August 2012 edition of SmartMoney Magazine, which arrived from said reader in yesterday’s mail, that comment can now be moved over into the "confirmed" category.

The prediction, to be sure, didn’t require any particular clairvoyance on my part.  Its sources are, first, a decent grasp of the history of economic stupidity, and second, a keen sense of the levels of desperation in what we might as well call the investmentariat, the people who have a little money and are looking for a safe place to put it.  The investmentariat has been told for decades that their money ought to make them money, but nobody told them that this only works in an economy that experiences sustained real growth over the long term, and nobody would dream of mentioning in their hearing that we don’t have an economy like that any more.

All the investmentariat knows for sure is that the kind of safe investment that used to bring in five per cent a year is now yielding a small fraction of one per cent, and the risks you need to take to get five per cent a year are those once associated with the the kind of "securities" that make a mockery of that title. The resulting panic is SmartMoney’s bread and butter. Smart money in the old sense—that is to say, the people who know what’s going on in the sordid and scam-ridden world of investment—wouldn’t waste five seconds on such a magazine; they know you can’t get any kind of advantage from something that a couple of million people are also reading.  No, this is strictly for the investmentariat:  as glossy, glib, and superficial as a teen fashion magazine, and just as unerringly aimed at the lowest common denominator of contemporary thought.

It will thus come as no surprise that the cover story on the August 2012 issue of SmartMoney is "The Return of Fossil Fuels," and that it rehashes the latest clichés about vast new gas and oil reserves without raising any of the the inconvenient questions that a competent practitioner of the lost art of journalism, should one be wakened from enchanted sleep by the touch of a 1940s radio microphone, would ask as a matter of course. The article trumpets the fact that America is importing less oil than last year, for example, without mentioning that this is because Americans are using less oil—unemployed people who’ve exhausted their 99 weeks of benefits don’t take many Sunday drives—and it babbles about natural gas for two largely fact-free pages without mentioning that claims about vast supplies far into the future rely on assumptions about the production decline rate from fracked shale gas wells that make professionals in the gas drilling industry snort beer out their noses. 

All this, inevitably, is window dressing for suggestions about which stocks you should buy so you can cash in on the fracking boom. Last I heard, it was still illegal for journalists to take payola for pimping individual companies, or to speculate in the stocks they promote; still, I trust my readers will already have realized that one set of professional market players will get copies of the magazine the moment it hits the newsstand, snap up shares in the companies promoted in each issue, and dole them out at inflated prices to SmartMoney readers who get their magazines later, while another set of professional market players will take out short contracts on those same stocks as they peak, wait for the rush of buyers to crest and recede, and cash in on the inevitable losses. Those are among the ways the game is played—and if this suggests to you, dear reader, that the readers of SmartMoney are not going to get rich from shale gas by following this month’s tips, well, yes, that’s what it means.

This is business as usual in the financial industry, which has made a lucrative business out of extracting wealth from the investmentariat in various ways.  This is part and parcel of the broader and even more lucrative business of extracting wealth from everywhere by every available means.  The question that might be worth asking here, and is rarely asked anywhere, is whether the financial industry provides anything to the rest of the economy commensurate with its immense income and profits. Any economics textbook will tell you that companies raise capital by issuing stock, selling bonds, and engaging in a few other kinds of transactions in the financial markets, and that this plays a crucial role in enabling economic growth. Well and good; there are many other ways to do the same thing, but we’ll accept that this is the way modern industrial societies allot capital to new and expanding businesses. How much of the financial industry’s total paper value has anything to do with this service?

Let’s do some back of the envelope calculations. In 2010, the latest year for which I could find figures, the total value of bonds issued by nonfinancial businesses was $1.3 trillion, and the total net issuance of stock by all companies was $387 billion—that includes stock issued by financial businesses, but since this is a rough estimate we’ll let that pass. Total stock and bond issuance in 2010 to support the production of real goods and services was thus something less than $1.7 trillion; let’s double that figure, just to leave adequate room for other ways of raising capital that might otherwise slip through the cracks, for a very rough order-of-magnitude figure around $3.4 trillion.

In 2010, the total stock of debt and equity potentially available for trading in financial markets was $212 trillion, and the total notional value of derivatives that same year was estimated at $707 trillion. Exactly how much of this was traded in the course of the year on all markets is anybody’s guess—some stocks heavily traded by computer programs may change hands dozens of times in a day, while other assets spent the whole year sitting in a safe deposit box; still, this is back-of-the-envelope stuff, so we’ll use the total value just listed as a very rough measure of the size of the financial economy. We can round up a little here, too, to make room for forms of wealth not included in the two categories just named, and estimate the total paper value of the world’s financial wealth at $1 quadrillion, of which the fraction directed into the productive economy in one year amounts to around a third of one per cent.

Now of course providing capital to the productive economy is only one of the things the financial industry does that’s arguably useful to someone other than financiers. Local and national governments use the financial industry to raise funds for public works, individuals borrow money for the occasional useful purpose, and so on.  Let’s be generous, and assume that the amount of money that flows from the world of finance for these purposes is double the total input of capital into nonfinancial businesses via stocks and bonds. That means that in any given year, maybe one per cent of the financial economy has anything to do with the production of real, nonfinancial goods and services.

The rest?  It consists of ways to make money from money.  That seems innocuous enough, until you remember what money actually is. Money is not wealth; it’s a system of abstract, culturally contrived tokens that we use to manage the distribution of real goods and services.  A money system can simplify the process of putting energy, raw materials, labor, and other goods and services to work in productive ways; that’s the reason we have money, or rather the reason most of us are prepared to discuss in public. That’s not what the other 99% of the world’s financial assets are doing, though. They are there to ensure that the people who own them have disproportionate, unearned access to real, nonfinancial goods and services. That’s the other reason, the one nobody wants to mention.

Not that many centuries ago, across much of the world, usury—lending money at interest—was considered a serious crime, more serious than robbery, and was also classed as a mortal sin by Christian and Muslim religious authorities; it’s no accident that Dante consigned usurers to the lowest pit of the seventh circle of Hell. That’s been dismissed as a bit of primitive moralizing by modern writers, but that dismissal is yet another example of the way that contemporary industrial culture has ignored the painfully learned lessons of the past.  In a steady-state or contracting economy, usury is a parasite that kills its host; since the total stock of real wealth does not expand from one year to the next, each interest payment enriches the lender but leaves the borrower permanently poorer. 

Only in an expanding economy can usury be tolerated, since interest can be paid out of the proceeds of economic growth.  Periods of sustained economic expansion are rare in human history, since most societies live close to the edge of the limits to growth in their bioregions; the exceptions, such as the late Roman Republic and early Empire, usually involve the expansion of one society at the expense of others.  The late Roman Republic and early Empire, it may be worth noting, had a large and very successful moneylending industry, which fed on the expanding Roman state in much the same way that the Roman state fed on the accumulated wealth of the Mediterranean world. Only after Roman expansion stopped did attitudes shift, in favor of a religion that was violently opposed to usury.

During the three centuries of their power, the world’s industrial nations looted their nonindustrial neighbors with as much enthusiasm as the ancient Romans looted theirs, but they had another source of plunder—half a billion years of fossil sunlight, stored up in the form of coal, oil, and natural gas. In effect, we stripped prehistory to the bare walls so that we could enjoy an age of gargantuan excess unlike any other.  One consequence was that our moneylending industry was able to metastasize to a scale no previous gang of usurers has ever been able to attain. The basic arithmetic remains unchanged, though: usury is only viable in an expanding economy, and as the global economy enters its post-peak oil decline, the entire structure of money that makes money is going to come apart at the seams.

I’d like to suggest, in fact, that the unspoken subtext behind the financial crises of recent years is precisely that the real economy of goods and services is no longer growing enough to support the immense financial economy that parasitizes it. The current crisis in Europe is a case in point. Since the crisis dawned in 2008, EU policy has demanded that every other sector of the economy be thrown under the bus in order to prop up the tottering mass of unpayable debt that Europe’s financial economy has become.  As banks fail, governments have been strongarmed into guaranteeing the value of the banks’ worthless financial paper; as governments fail in their turn, other governments that are still solvent are being pressured to fill the gap with bailouts that, again, amount to little more than a guarantee that even the most harebrained investment will not be allowed to lose money.

The problem, as the back of the envelope calculations above might suggest, is that you can cash in the whole planet’s gross domestic product—that was a little under $62 trillion in 2010—and not come anywhere close to the value of the mountain of increasingly fictive paper wealth that’s been piled up by the financial industry in the last few decades.  Thus the EU’s strategy is guaranteed to fail. EU officials are already talking about "haircuts" for bondholders—that’s financial jargon for investors not getting paid as much as their holdings are theoretically worth. Not so long ago, that possibility was unmentionable; now it’s being embraced frantically as the only alternative to what’s actually going to happen, which is default.

There’s been a lot of talk about that in the blogosphere of late, and for good reason. No matter how you twist and turn the matter, Greece is never going to be able to pay its national debt. Neither are Spain, Italy, or half a dozen other nations that ran up big debts when it was cheap and convenient to do so, and are now being strangled by a panicking bond market and a collapsing economy. This isn’t new; most of the countries on Earth have either defaulted outright on their debts or forced renegotiations on their creditors that left the latter with some equivalent of pennies on the dollar. The US last did that in a big way in 1934, when the Roosevelt administration unilaterally changed the terms on billions of dollars in Liberty Bonds from "payable in gold" to "payable in devalued dollars," and proceeded to print the latter as needed.  That or considerably worse will be happening in Europe in the near future, too.

A good deal of the discussion of these upcoming defaults in the blogosphere, though, has insisted that these defaults will lead to a complete collapse of the world’s financial economy, and from there to an equally complete collapse of the world’s productive economy, leaving all seven billion of us to starve in the gutter. It’s an odd belief, since sovereign debt defaults have happened many times in the recent past, currency collapses are far from rare in economic history, and nation-states can do—and have done—plenty of drastic things to keep goods and services flowing in an economic emergency.  Partly, I suspect, it’s our old friend the apocalypse meme—the notion, pervasive in modern culture, that the only alternative to the indefinite continuation of business as usual is some unparallelled cataclysm or other.

Still, there’s another dimension to these fantasies, which is simply that the financial industry has done a superb job of convincing people that what they do is important to the rest of us. It’s true, to be sure, that having currency in circulation makes economic exchanges easier, and the kind of banking services that people and ordinary businesses use are also very helpful, but governments used to produce and circulate currency without benefit of banks until fairly recently, and banking services of the kind I’ve just mentioned can be provided quickly and easily by a government that means business; in 1933 it took the US government just over a week, at a time when information technology was incomparably slower than it is today, to nationalize every bank in the country and open their doors under Federal management. The other services the financial industry provides to the real economy can equally well be replaced by hastily kluged substitutes, or simply put on hold for the duration of the crisis.

So the downside of any financial crisis, however grandiose, can be stopped promptly by proven methods. Then there’s the upside. Yes, there’s an upside.  That’s the ultimate secret of the financial crisis, the thing that nobody anywhere wants to talk about: if a country gets into a credit crisis, defaulting on its debts is the one option that consistently leads to recovery.

That statement ought to be old hat by now. Russia defaulted on its debts in 1998, and that default marked the end of its post-Soviet economic crisis and the beginning of its current period of relative prosperity. Argentina defaulted on its debts in 2002, and the default put an end to its deep recession and set it on the road to recovery. Even more to the point, Iceland was the one European country that refused the EU demand that the debts of failed banks must be passed on to governments; instead, in 2008, the Icelandic government allowed the country’s three biggest banks to fold, paid off Icelandic depositors by way of the existing deposit insurance scheme, and left foreign investors twisting in the wind. Since that time, Iceland has been the only European country to see a sustained recovery.

When Greece defaults on its debts and leaves the Euro, in turn, there will be a bit of scrambling, and then the Greek recovery will begin. That’s the reason the EU has been trying so frantically to keep Greece from defaulting, no matter how many Euros have to be shoveled down how many ratholes to prevent it. Once the Greek default happens, and it will—the number of ratholes is multiplying much faster than Euros can be shoveled into them—the other southern European nations that are crushed by excessive debt will line up to do the same.  There will be a massive stock market crash, a great many banks will go broke, a lot of rich people and an even larger number of middle class people will lose a great deal of money, politicians will make an assortment of stern and defiant speeches, and then the great European financial crisis will be over and people can get on with their lives.

That’s what will happen, too, another five or ten or fifteen years down the road, when the United States either defaults on its national debt or hyperinflates the debt out of existence.  It’s going to do one or the other, since its debts are already unpayable except by way of the printing press, and its gridlocked political system is unable either to rationalize its tax system or cut its expenditures.  The question is simply what crisis will finally break the confidence of foreign investors in the dollar as a safe haven currency, and start the panic selling of dollar-denominated assets that will tip the US into its next really spectacular financial crisis. That’s going to be a messy one, since the financial economy is so deeply woven into the fantasy life of the average American; there will be a lot of poverty and suffering, as there always is during serious financial crises, but as John Kenneth Galbraith pointed out about an earlier crisis of the same kind, "while it is a time of great tragedy, nothing is being lost but money."

It will be after that, in turn, that the next round of temporary recovery can begin. We’ll talk more about that in the weeks to come.

End of the World of the Week #32

"If at first you don’t succeed, try, try again," is a common proverb in many fields, but it’s particularly appropriate for prophets of apocalypse. Some make one prediction and vanish from history when it fails, to be sure, but a good many of them are made of sterner stuff, and respond to the failure of one prediction by making another a little further into the future.  Bravest of all are those whose prophecies emerge one after another, each one just as inaccurate as the ones before it, each one uttered with  serene conviction, as though none of the others had ever appeared—or flopped.

Among this aristocracy of apocalypse, evangelical Christian author Hal Lindsey ranks high. He first burst onto the end of the world scene in 1970 with The Late Great Planet Earth, which blended standard Protestant fundamentalist apocalyptic rhetoric with a flurry of topical references to the Soviet Union and other headline-making themes, to claim that the Rapture, the Tribulation, and the Second Coming were going to arrive any minute now.

The Late Great Planet Earth was followed by more than a dozen books, each mapping the same theological claims onto a different set of current affairs  The only thing that was lacking was the Rapture, the Tribulation, and the Second Coming, or for that matter any reason even for believers to think these events would happen when Lindsey said they would.

—for more failed end time prophecies, see my book Apocalypse Not

Wednesday, July 18, 2012

On the Far Side of Denial

Any readers of The Archdruid Report who grew up, as I did, watching old black and white science fiction serials repackaged for the afternoon TV market may be forgiven for an overload of déjà vu just now.  Somewhere near the end of any given serial, there’s inevitably a moment when the evil overlord says, “No! This cannot be! I am invincible!” It’s usually a close-up shot on the evil overlord’s sinister face, and it’s followed within fifteen seconds or so by a cataclysmic explosion that vaporizes the evil overlord, his death ray, his fortress of doom, his legions of terror, and everything else within a couple of planetary diameters or so, except the hero and any other characters who are sympathetic enough to be allowed by the scriptwriters to get to safety behind the zarkonite shield.

Well, it’s been said. Get ready for the explosion.

The example I’m thinking of right now is Lord Browne, formerly the chairman of British Petroleum and now a major player in the fracking industry. A few days ago, in a public appearance, he insisted that the United States would be able to stop importing foreign oil by 2030, because the supply of shale gas that would be made available to the US by fracking technology was, and I quote, effectively infinite.


I found myself wondering if Lord Browne might possibly have been one of the contestants in the Monty Python Upper Class Twit Of The Year Contest skit which, in a nice bit of synchronicity, a reader forwarded to me right about the time that his lordship was making a very public fool of himself. Browne has been employed for some time in the oil industry, and therefore has had every opportunity to find out that the word "infinite" does not belong in any meaningful statement about fossil fuels. Now of course he may simply have been engaged in the same sort of puffery that we saw not too long ago from mortgage brokers and real estate agents, who had pressing financial reasons to spend much of their time expressing equally expansive and equally inaccurate notions of where their market was headed. Still, I suspect there’s more going on than this.

Over the last six months or so an extraordinary torrent of nonsense about limitless gas and oil supplies has been sloshing through the media, spouting out from an equally extraordinary assortment of people who ought to know better. We’ve seen pundits loudly claiming that the United States had become a net petroleum exporter, when what was going on was that modest amounts of gasoline and other refined petroleum products that Americans are too poor to afford nowadays are being sold to more prosperous countries abroad. We’ve seen fracking technology, which the oil industry has been using for decades, waved around as a brand new technological breakthrough; we’ve seen the Bakken shale, which has been known since the 1970s and doesn’t actually have that much accessible oil in it, ballyhooed as a brand new game-changing discovery; we’ve seen the most blatant falsehoods proclaimed as fact—I’m thinking here of the pundit I critiqued in a previous post, who insisted that kerogen shales are exactly the same as what’s being drilled in the Bakken, and that the US therefore has some absurd amount of shale oil ready for pumping.

Over the last few weeks, a number of my fellow peak oil writers have expressed worries about this outpouring of counterfactual drivel. Myself, I find it a very hopeful sign. What we are seeing is the shattering of the consensus that has excluded any discussion of peak oil from the collective conversation of our time. Plenty of pundits who refused to talk about peak oil at all are now talking about it incessantly.  Even though they’re screeching at the top of their lungs that it can’t happen, and scrabbling around for any argument, however feeble or blatantly false, they can use to back up that proposition, they’re still talking about it.

That is to say, industrial society is collectively entering the stage of denial.

The application of Elisabeth Kubler-Ross’ five stages of grief to the process of dealing with peak oil has become common enough in the peak oil scene that an offhand reference to one stage or another in a talk or blog post on the subject rarely needs an explanation.  It’s not just peak oil: the sequence of denial, anger, bargaining, depression, and acceptance has become part of the common currency of thought in the modern world. For all its drawbacks and critics—and it has plenty of both—the five stages do a tolerably good job of modeling the way many people go through the grieving process in most contexts, which is after all as much as any theoretical structure can be expected to do.

Whatever its more general applicability, furthermore, it very often fits the experience that people have when they start to wrestle with peak oil and everything that it implies. Those of us who have been in the peak oil scene for a while now have watched plenty of people stumble their way through it one step at a time. There’s the denial stage—no, that can’t possibly happen, I’m sure they’ll come up with something, there must be plenty of oil around here somewhere.  There’s the anger stage—it’s all the fault of the politicians, the bankers, the oil companies, David Icke’s evil space lizards, or somebody, and if we just denounce them loudly enough on our favorite blogs, we’ll be fine.  There’s the bargaining stage—okay, the age of abundance is over, but if we build lots of wind turbines or buy organic coffee or go to one more round of meetings where we all come to a consensus about the nice cozy future we think we want, it’ll all work out, right?  There’s the depression phase—we’ve failed as a species, humanity is irremediably awful, it would be better for the whole cosmos if Gaia just got it over with and chucked us into extinction’s compost heap, and so on. Then, finally, comes acceptance, when you’ve finished dealing with your emotional issues about the end of the petroleum age and can get to work at last on the practical stuff.

Now of course some people go through the stages in a different order, some people skip one or more of them, and some people get stuck in one or another of them. (Kubler-Ross recognized that the same thing happens in the kinds of grieving she studied, a point her critics don’t often remember.)  Still, the model stays in use in the peak oil scene because something roughly comparable to the five stage process can be traced in the experiences of a lot of people who go through a peak oil awakening. That much is a fairly common realization  in the peak oil scene; what I don’t think many of us anticipated, though, is that the same process might happen on a collective level as well. I suggest that this is what’s been happening in recent months, and that it’s what has driven the tirades against peak oil that we’ve all seen splashed over the media.

With that in mind, I’d like to glance over at a considerably more useful artifact of the current stage of the peak oil debate. Feasta has just released a study by David Korowicz on the ways that a financial crash could kickstart a more general economic implosion by gutting the fiscal gimmickry that keeps international trade running. (You can download a PDF here.)  It’s a thoughtful analysis, and it takes the time to make its assumptions explicit, which is useful; in the very few places where it runs off the rails, it’s fairly easy to glance back to the presuppositions governing the study and figure out where the problem lies.

Korowicz argues, if I may oversimplify his careful prose, that the current global financial system is a tottering mess that could come apart at the seams in no time flat, and it’s under stress already from a variety of factors, including peak oil.  If and when it comes apart,  he suggests, the entire structure of letters of credit and currency flows that supports global trade in little luxuries like enough food to eat could quite readily come apart also, producing a fiscal cardiac arrest that could shatter supply chains and bring most nations’ economies to a screeching halt in a matter of days or weeks.

Is this a plausible scenario? It’s considerably more than that, for a close equivalent happened in late 1932 and early 1933 in the United States.  A banking system that had been fatally wounded by the 1929 stock market crash and its aftermath had been propped up temporarily by federal money—they called it the Reconstruction Finance Corporation then; that’s spelled "TARP" this time around—but was still loaded to the breaking point with huge amounts of worthless debt and unprepared for ongoing economic contraction.  Then a new round of economic crisis triggered by events in Europe—no, I’m not making up any of this; look it up—pushed the US banking system over the edge; as banks folded one after another, the basic trust that makes a credit-based economy function evaporated; nobody could be sure if the bank that received their deposits or their loans would still be there the next day, bank runs followed, and the whole economy shuddered to a halt. Paychecks could not be cashed, businesses could not pay their suppliers or get paid for their products, and many of the negative consequences Korowicz sketches out duly happened.

Could that happen again, on a global scale? You bet. It’s the sequel, though, that didn’t get into Korowicz’ analysis. Faced with the imminent reality of national collapse, the US government did not sit on its hands, which is what those with the capacity to do something are always required to do in fast collapse theories. Instead, it temporarily nationalized the entire American banking system, declared that all assets held by the banks were owned by the government until further notice, made private ownership of gold by US citizens illegal, and ordered every scrap of gold in the country much bigger than a wedding ring sold to the government at a fixed, below-market price, with stiff legal penalties for anybody who tried to hang onto their gold stash. (I’m not making up any of this, either.  Look it up.) Flush with seized bank assets and confiscated gold, the government poured money into the nationalized banks, which could then meet every demand for funds, stopping the panic in its tracks. Once stability returned, the banks returned to private ownership and got their assets back, though gold remained a government monopoly for decades longer.

This sort of drastic measure is far from rare in economic history. Germany in the 1920s put paid to its era of hyperinflation by issuing a new currency, the rentenmark, which was backed by taking out one big mortgage on every single piece of real property in the country. Other countries have done things even more extreme.  A nation facing collapse, it bears remembering, has plenty of options, and it also has the means, motive, and opportunity to use them. 

It’s only fair to point out that this sort of drastic response is something that the Feasta study specifically excludes. One of Korowicz’ basic assumptions, stated as such in his study, is that governments will respond to the crisis by choosing the minimal option they think will solve the immediate problem. It’s a reasonable assumption, right up to the point that national survival is at stake, but at that point history shows in no uncertain terms that the assumption goes right out the window.  Nation-states are good at surviving—that’s why they’ve become the standard form of human political organization in the viciously Darwinian environment of modern history—and it’s hard to think of anything a nation-state won’t do if it thinks its survival is threatened.

That said, Korowicz’ study points to one very plausible way that the next major round of crisis could slam into the industrial world. The fact that the nations affected by it could kluge together responses to it, slap the equivalent of defibrillator paddles onto their prostrate economies, and get a heartbeat again for the time being doesn’t change the fact that a financial collapse followed by even a partial supply chain breakdown would be a massive crisis, the sort of thing that could well plunge hundreds of millions of people into permanent poverty and push the global economy further down a long ragged decline that will be much less amenable to drastic responses.  We’re in agreement, in effect, that the patient is terminally ill; the question is simply whether first aid measures available to the paramedics on site can get his heart beating again, so he can drag out the dying process for a while longer.

Of course this is not the way the Feasta study is being discussed over much of the peak oil blogosphere. The fascination with sudden collapse—call it the Seneca cliff if you must, though it’s only fair to note that Seneca was talking about morality rather than the survival of civilization, and the civilization to which he himself belonged took centuries to decline and fall—is to the peak oil scene exactly what the fixation on Bakken shale oil and "effectively infinite" natural gas is to the collective imagination of industrial society as a whole: a means of denial.  It’s just one more way of pretending that we and our grandchildren’s grandchildren don’t have to endure the long bitter centuries of decline and fall that are waiting for us—a future that, let’s face it, is considerably more frightening than a sudden collapse. Claiming that it’ll all be over in a flash is not that much different, all things considered, from claiming that it won’t happen at all.

Wry reflections about evil overlords aside, I suspect we’ve got a ways still to go before the various modes of denial finish working their way through the collective imagination of our time.  The pundits and corporate flacks who have, for all practical purposes, gone barking mad about the world’s energy supply—I really don’t think any less forceful phrasing reflects the nature of these strident claims that scraping the bottom of the barrel, via fracking or otherwise, ought to be treated as proof that the barrel’s still full—are by and large associated with the two economic sectors, finance and petroleum, that are going to be clobbered first and hardest as the reality of peak oil sets in. The elephant’s in their living rooms; that’s why their shrill denials that elephants exist can be heard so clearly all through the neighborhood.  As the elephant roams a little more widely, I suspect that the same frantic tone will travel with it, until finally we find ourselves on the far side of denial and the next phase starts.

That phase, for those who haven’t kept track, is anger. It’s once that stage arrives in force that the explosion will follow.

End of the World of the Week #31

There are times, when the small hours of the morning arrive and I’m still awake and pondering, when I wonder about some of the great and insoluble questions of our time. One of these is why people listen when academics predict the future. It’s a common habit of professional scholars to do so, and the media and the public both lap it up, despite the awkward fact that almost all of those predictions turn out to be embarrassingly wrong.

One of the classic examples was the prophecy, widely made in the middle decades of the twentieth century and even more widely believed, that the great social crisis of the decades immediately ahead was going to be the end of work. Serious articles in serious periodicals and cocktail-party chitchat alike insisted that as automation took over, robot labor would inevitably replace human beings, first on the assembly line, then across the spectrum of employment, until the vast majority of people across the industrial world would no longer be needed in the labor force.

The mainstream liberal approach (in those days, remember, liberals were the mainstream) was to speculate about the promise and peril of a new age of limitless leisure, in which most people lived on a nationally guaranteed income and only artists, intellectuals, and executives had anything even close to a job. There was a great deal of very earnest talk about helping the poor, who allegedly couldn’t figure out what to do with spare time on their own, to fill their hours with suitably improving leisure activities. Meanwhile radicals insisted that once the new automated factories were in place, the ruling elite would simply exterminate the unnecessary population en masse. For many people in the 1960s radical scene, that was the most likely way the world—or at least their world—was supposed to end.

It’s indicative of the time that nobody questioned the assumption that the fantastic amount of energy needed for all those robot factories would be forthcoming, and nobody questioned that within a few years there would be, say, robots sophisticated enough to make your bed and cook your dinner. Both of those assumptions, and a great many more of the common beliefs of that time, turned out to be hopelessly wrong—and so, in turn, will plenty of the unquestioned presuppositions of our own time.

—for more failed end time prophecies, see my book Apocalypse Not

Wednesday, July 11, 2012

The Distant Sound of Tumbrils

I’ve commented more than once in these essays about the echoing gap between the fantasies of elite omnipotence so common in contemporary America, and the awkward realities of a nation where power has become so diffuse that constructive action is all but impossible. The diffusion of power over time is a commonplace in the history of nations; an earlier post in this series has already discussed the concept of anacyclosis, the ancient Greek historian Polybius’ analysis of the way the diffusion works; still, there’s another dimension to it as well.

That dimension? The cluelessness that so often afflicts ruling classes in the last years of their power.

There’s no shortage of poster children for that in the present case, but I want to call on one of the less blatant examples here, precisely because he’s a very smart man. The person I have in mind is Robert D. Kaplan, who burst onto the current-affairs scene in a big way in 1994 with a harrowing and crisply written article titled "The Coming Anarchy." He’s one of the brightest of the tame intellectuals who provide American politicians with things to talk about, and like many of those tame intellectuals, he clawed his way up from a middle-class background to his present status as an adviser to Pentagon brass and a regular speaker at high-end conferences.

Thus it’s revealing to go back to one of his books from the 1990s, the lively but inconclusive An Empire Wilderness: Travels into America’s Future (1998), and read his account of his one brief collision with the country he thinks he’s exploring. Most of the book chronicles Kaplan’s encounters with his peers—that is to say, other tame intellectuals and the politicians and businessmen whose largesse keeps them employed—in their natural habitat, a landscape of airports, office parks, urban condominiums, and other fashionable venues. Once, though, his years as a foreign correspondent in some of the world’s rough places broke through, and he climbed aboard a Greyhound bus for a trip through the American Southwest to see the country and the people first hand.

The scene is really one of the best examples of unintentional comedy in modern letters. Kaplan briefly succeeded in extracting himself from the bubble in which tame intellectuals of his caliber normally live, and the world outside the bubble shocked him right down to the soles of his Bruno Magli shoes. His fellow passengers were, like, fat, and even the thin ones didn’t seem to be trying to fit any definition of pretty and stylish he’d ever encountered; they wore cheap ill-fitting clothes in garish colors, and some of them had their belongings in plastic garbage bags rather than, say, Gucci suitcases. You could practically hear the "Ewww, icky!" escape his lips.

Now it so happens that I’ve done a certain amount of travel by Greyhound bus through various corners of the country, and shared space on a moving bus with the same kind of Americans that left him gaping in horror. (If I’d been on that bus with him, no doubt he’d have been appalled by the guy with the scruffy beard and ponytail two seats up, wearing baggy clothes that had seen many better days—hint: you don’t wear nice clothes on a long bus trip—and reading some dog-eared fantasy novel from the 1970s instead of whatever piece of highbrow trash the New York Review of Books was touting that week.)  I’ve seen the garish polyester tank tops and the T-shirts that look like they’ve been used to clean auto parts, the women on their way to visit boyfriends who are doing five to ten for one thing or another, the college students who don’t have fancy scholarships, the middle-aged couple with bottom-level jobs on their way to visit some uncle they haven’t seen in ten years and who’s dying of cancer, and all the rest of it.  All this is familiar enough to most Americans, but to Kaplan, it came as a shock.

Mind you, he had the courage to get in line along with his unfashionably plump, unfashionably dressed, unfashionably accessorized fellow passengers, and board that bus. I suspect that most of his peers have never done anything of the kind, and would never think of doing so. In today’s America, if you want to avoid seeing how most people live, nothing could be easier; America’s geography is so thoroughly carved up by income level that it takes a deliberate effort to fall out of the comfortable orbits inhabited by the middle and upper classes and plunge back down to Earth.

This is quite common in aristocratic societies at certain points in their history. When Marie Antoinette responded to reports that the Parisian poor had no bread by saying, "Then let them eat cake," she was being clueless, not catty; a life in the rarefied circles at the zenith of ancien régime France had given her precisely no exposure to the fact that it was the price of bread, not some unexpected shortage of it, that was making the lives of the underclass wretched. Her husband probably had a slightly clearer grasp of the situation, at least in the abstract, but he—along with a great many other aristocrats who would share his fate—had no more useful an understanding of the powderkeg on which the vast and tottering structure of the ancien régime was so unsteadily perched.

The irony here is that the ancestors of these same aristocrats had been as hard-bitten a collection of ruthless pragmatists as history has on display. The medieval barons whose progeny were on their way to an appointment with Madame Guillotine not long after 1789 resembled nothing so much as old-fashioned Sicilian mafiosi, complete with the Mafia’s devotion to the Catholic church, its code of honor, and its readiness to slaughter people en masse whenever the situation seemed to warrant it. Like every other feudal elite in history, the old French aristocracy emerged in a time of chaos, when the last scraps of central government had gone missing in action, and local landowners smart and strong enough to gather a band of armed followers and lead them into battle could impose their own rough justice on as large a domain as they could seize and hold.

Such times do not favor cluelessness.  Even after the feudal system formalized itself, the heir to a barony who was too detached from the hard realities of the time could count on being removed from his position by the business end of a battle-axe.  It was only after warfare became a monopoly of the French king, and aristocrats no longer had to risk their lives regularly leading their vassals on the battlefield, that it was possible for the French upper classes to isolate themselves in a bubble of their own creation and start drifting toward their wretched destiny.

It’s of interest to note that this process took a great deal longer in two other European nations, Britain and Prussia—those of my readers who got an American public school education, and so know nothing about history, will probably need to be told that Prussia was the nucleus of the German Empire, and what’s left of it is now part of Germany. In Britain until after the Napoleonic Wars, and in Prussia right up through the Second World War, it was common for the sons of aristocrats to join the military.  Since Britain and Prussia both spent most of the 18th century at war, clueless young aristocrats tended to be removed from the gene pool via the helpful Darwinian selection pressures of early modern warfare. It’s worth noting also that British noble families drifted out of the habit in the 19th century, and the stereotype of the blithering aristocratic idiot entered British popular culture not long thereafter.

America’s aristocracy—yes, I can hear the screams of outrage evoked by the use of that latter phrase. Let us please get real; we have one, or a close equivalent to one. In every community of social primates, there’s an inner circle of members who have more influence, and more access to whatever wealth happens to be available, than the other members. In every community of social primates, your odds of getting into that inner circle depend partly on whether your parents belonged to it, and partly on your own ability to defeat rivals and bluff or bully or fight your way into it. Any group of social primates that claims not to have an aristocracy—as far as I know, this affectation is limited to human beings, though I wouldn’t be surprised to learn that bonobos have gotten into it as well—has simply found it convenient to rely on a covert hierarchy instead of an overtly recognized one.  In today’s America, as in every other human society, the single most important predictor for your place in the income distribution curve is your parents’ place in the same curve. Some people do move up from below—Kaplan, as already mentioned, is an example—but they do so by adopting the values and attitudes of members of the social strata above them, who by and large control who is and isn’t allowed to make that ascent, and who make that choice on the basis of who fits in.

America’s aristocracy, as I was saying, has never had the tradition of sending its sons into the military.  The great wars of America’s history—the Civil War and the two World Wars—have seen members of every class show up at recruiting stations; the little wars have been fought by professionals or, in a few cases, by whoever happened to enlist when the drums started pounding and the press yelled for war. Most other potential sources of Darwinian selection have been kept away from America’s privileged classes with equal solicitude. The one exception is economic struggle, and even there the transfer of wealth from individual financiers and industrialists to trusts and holding companies has done much to guarantee that even the most feckless child of wealth and privilege will continue to enjoy wealth and privilege until the guy with the scythe makes the whole point moot.

John Kenneth Galbraith, whose prescient writings pointed to so many of the pitfalls into which today’s America is busily flinging itself, sketched out the consequences with his usual urbane wit in his 1992 book The Culture of Contentment. Galbraith seems to have taken a good deal of pleasure in making himself unpopular in the corridors of power and privilege, and the book just noted must have contributed heartily to that end; I’m thinking here particularly of his discussion of the unmentionable fact that the more money an American makes, the less actual work he or she has to do to earn it. Still, the core of the book is a precise and mordant comparison between the privileged class of contemporary America and an example I’ve already cited, the French nobility on the eve of the Revolution.

That comparison has an exactness that very few people notice these days.  Louis XIV, the Franklin Roosevelt of his day, took a great deal of wealth and privilege from the French aristocracy and imposed a flurry of restrictions they found burdensome.  After his time, it became a central goal of the nobility to restore their position at the king’s expense. Their strategy is one with which modern Americans ought to be familiar: they insisted on a massive military buildup and an aggressive foreign policy that landed France in expensive wars, while at the same time demanding tax cuts.  The goal was simply to bankrupt the French government, so that—no, not so that they could drown it in a bathtub; instead, they wanted to force the king to call the États-Général—roughly, the equivalent of a US constitutional convention—which alone could create entirely new tax structures. Once that happened, they hoped to bully the king into restoring their former privileges as the price of acquiescing in a new tax regime.

The result was a high-stakes game of chicken between the party of the aristocracy, and the party of the civil servants, bureaucrats and officials whose authority and wealth was guaranteed by the power of the king. (If you want to describe these two parties as "Republicans" and "Democrats," I’m not going to argue.)  What neither side noticed was that their struggles imposed severe burdens on the rest of the population, the peasants, laborers, and small-scale businesspeople on whose passive acquiescence the entire structure of power and prestige ultimately rested. As the struggle went on, the aristocracy did their best to delegitimize the king and the central government, while the civil service and its supporters did their best to delegitimize the aristocracy; both sides succeeded beyond their wildest dreams, and managed to strip the last traces of popular legitimacy from the French political system as a whole.

So when the aristocrats finally got their way and the États-Général were summoned, all it took was a few speeches by radicals and a bit of violence on the part of the Paris mob, and the entire structure of the ancien régime disintegrated in a matter of weeks.  The aristocrats, who were chiefly to blame for the mess, were also the last to figure out what had happened. It’s tempting to imagine one of them, stepping aboard the tumbril that will take him to the guillotine, saying to another, "So, Henri, how’s that political strategy working for you?"—but there’s no evidence that any of them managed that degree of insight even when the consequences of their failure were staring them in the face.

I sometimes wonder whether the members of America’s privileged classes will show any more insight into the forces behind whatever messy fate waits for them.  Certainly they’re making all the same mistakes as their French equivalents. The power, wealth, and influence of the privileged classes in today’s America is a function of their ability to manipulate an elaborate structure in which government and what we jokingly call "private" industry are inextricably tangled. Most members of those classes have no skills worth mentioning other than those needed to manipulate that structure. They’re very good at manipulating the structure, and extracting wealth from it—that’s why they have the status and the influence they do—but they have forgotten, as most aristocracies forget when they reach senility, their own dependence on the structure.

Like the aristocrats of France before the Revolution, indeed, they’re busy undermining the structure that supports them—the culture of executive kleptocracy that pervades the upper end of American business these days is hard to describe in any other terms—and they’re equally busy trashing the last scraps of legitimacy the American political and economic system still has in the eyes of the people, for the sake of short term political advantage. It has in all probability never occurred to any of the people engaged in these activities that there could be negative consequences, or that the people in ugly clothes who bear the brunt of all this brinksmanship may eventually withdraw the support on which the entire structure depends. None of this can possibly end well: not for them, and probably not for the rest of us, either. I would remind those of my readers who think they would cheer the collapse of America’s ancien régime that what followed on the heels of 1789 was not the Utopia of reason promised by the radicals of that age, but the Terror, followed by the Napoleonic Wars.

In a way he didn’t intend, a core metaphor from Kaplan’s famous article "The Coming Anarchy" makes a perfect image for the mess ahead. He imagines the people of the world’s rich industrial countries as passengers in a limousine rolling through the dark and potholed streets of some Third World city, rife with poverty and violence. It’s interesting to note that he never asks what will happen when the limo runs out of gas. (I don’t happen to know his current views, but in earlier books he rejected the concept of peak oil.) Nor does he discuss what happens when the driver tries to dodge a pothole without braking and slams the limo into a brick wall—that’s more or less what’s happening to the economy of the industrial world just now—and let’s not even talk about the possibility that the people of the city might throw up some barricades, or lob a couple of Molotov cocktails in the limo’s direction. When one of those things happens—and I’m all but certain that it will—I hope Kaplan has enough of his wits about him to put on a greasy T-shirt and a pair of torn blue jeans, and mingle with the crowd.

I’d like to thank all my readers who chipped in over the last week to help Post Peak Fiction Magazine get off the ground. They’re still a ways short of the funding they need to get the magazine up and running, though. A donation of $35 will get you a subscription for the first year, not to mention help make sure that there is a first year. The magazine’s site at will give you all the details.

End of the World of the Week #30

I’m not sure what it is about UFOs, that iconic image of twentieth century folk mythology, that has been such a magnet for the apocalypse meme. Within a few years of those first 1947 sightings, UFO enthusiasts began to insist that sometime very soon, the saucers would make their presence impossible to ignore, either by landing on the White House lawn or in some other suitably dramatic fashion. Even though the years and decades have rolled by since then, the conviction remains unshaken; I still get fervent emails now and then insisting that I’ll see how wrong I am once Disclosure happens, which is sure to come any day now.

Still, not every true believer has the patience to sit and wait for the promised miracle to arrive all by itself. In 1952, science fiction fan turned UFO enthusiast Alfred Bender organized the International Flying Saucer Bureau, one of the very first UFO organizations in North America, and launched a project to talk to the aliens by mass telepathy. On World Contact Day, March 15, 1953, at 11:00 am Greenwich time, IFSB members and friends around the world concentrated on a message that began: "Calling occupants of interplanetary craft!" The goal was to get the saucers to respond somehow, in order to make contact with alien intelligences who would then save the Earth from the threat of nuclear war.

More than two decades later, an obscure Canadian band named Klaatu used the words of the message as the lyrics for their one major hit, Calling Occupants of Interplanetary Craft, which later got covered by the Carpenters. Still, that was the only response the message got; if there were aliens in Earth’s skies in 1953, they weren’t listening.

—for more failed end time prophecies, see my book Apocalypse Not

Wednesday, July 04, 2012

The Wrong Kind of Magic

Carl Jung and his physicist friend Wolfgang Pauli suggested in a too rarely read 1952 book that synchronicity—an "acausal connecting principle," to use Jung’s carefully phrased description—brought events that occur at the same time into a relationship of unexpected meaning. Whether or not they were right in general, there are times when synchronicities arrive with all the subtlety of a cold wet mackerel across the face, and last Friday was one of those.

That afternoon, after a busy couple of weeks centered on the hundredth anniversary of the Druid order I head, I finally had the spare time to put my feet up and do some reading, and the book at the top of the stack was James Howard Kunstler’s latest, Too Much Magic: Wishful Thinking, Technology, and the Fate of the Nation.  Anyone who’s read Kunstler’s previous work will no doubt already be guessing that Too Much Magic is lively, curmudgeonly, and highly readable, as indeed it is.  It’s best described as a seven-year update to his bestseller The Long Emergency, and its message is stark: the storm is upon us.

Then, not long after I finished the book, the storm really was upon us.

Meterorologists can tell you exactly what it was that sent a wall of powerful thunderstorms a couple of hundred miles wide sweeping eastwards across the Rust Belt from Wisconsin straight to the Atlantic coast, leaving chaos in its wake. Here in Cumberland, we noticed the haze thickening in the west toward late afternoon, taking on that drowned murky look that everybody locally recognizes as a warning of bad weather on the way.  By nightfall, lightning was going off like flashbulbs at a 1950s press conference, and about a quarter to nine, hurricane winds and sheets of rain struck as suddenly as though somebody had flipped a switch. The winds and the rain pounded us for an hour or so, and then gradually faded out; the lightning kept flashing for another hour or so after that.

Like the smartest of the three little pigs, Sara and I had provided ourselves with a brick house, one that was built well before the post-Second World War vogue for cheapjack building methods that Kunstler has rightfully excoriated in several of his other books. We got by without any real damage—granted, the big mulberry tree out back dropped a half ton or so of limb onto our driveway, but since we don’t own a car, all it did was scare the bejesus out of the local woodchucks. We lost power, but since we don’t use a lot of electricity anyway, that wasn’t a huge problem; we had a late dinner by candlelight, and then broke out the hand-cranked LED lamps and spent the rest of the evening by their light. By morning we had power again, but if we hadn’t, it would not have been a great inconvenience.

Yes, I’m including the lack of air conditioning in that. Cumberland gets hot and humid in the summer, but Sara and I don’t use air conditioning; that was a deliberate decision of ours, when we moved here three years ago. Human beings evolved in an equatorial zone, without air conditioners, and billions of us get by in very hot climates without them today; given the opportunity to adapt, the human body can handle hot and humid conditions easily. Of course the opportunity to adapt is precisely the issue here. I have immense sympathy for the people who found themselves suddenly evicted from air-conditioned comfort into the subtropical heat of a mid-Atlantic summer; if I hadn’t spent three years getting used to an unfamiliar climate, researching and relearning the skills that people here once used to get through summers in relative comfort, and making use of features built into a house that dates from long before air conditioning and was designed to be livable without it, I’d be miserable too.

It’s arguably high time that more people began acclimatizing themselves to a world in which they can’t simply turn on the air conditioning any time it gets hot and muggy.  In a broader sense, that’s the core message of Kunstler’s book. Since the end of the Second World War, most Americans—and, to be sure, a fair number of people in other countries—got used to being able to call upon practically unlimited amounts of cheap energy to do, well, just about anything they happened to want, so long as somebody else could make money off it.  Strawberries in winter? No problem; we’ll just fly them in from the other side of the planet. Rocks from the Moon?  Easily done, since all it takes is nearly unimaginable amounts of energy.  Cold dry air indoors in August?  Sure thing; we can just throw some gigawatts at it.  In the phrase Kunstler uses, we’ve all gotten far too used to getting things done by magic.

Regular readers of this blog will be expecting me to quibble about his use of that last word, and indeed I will.  Let’s save that for a bit, though, because what Kunstler is saying here deserves attention. The sort of magic he’s talking about is the kind you find in fairy tales and The Thousand and One Nights, not to mention an endless stream of shoddy fantasy novels and Hollywood extravaganzas churned out more recently, and the factor that defines it is that the people who use it never have to worry themselves about how it works.

Consider the old story of Jack and the Beanstalk.  All Jack has to do is plant the magic beans; he doesn’t have to figure out how they’re going to produce all that plant tissue overnight, so he can climb into the sky the next morning. For that matter, he doesn’t have to figure out how the giant’s castle stays up there in the sky, violating the laws of medieval and modern physics alike. He doesn’t have to do much or understand anything; it all just happens. That’s the sort of thing you get when the elegant symbolic narratives of an earlier age get dumbed down, stripped of their interpretive context, and relegated to the nursery. 

To be fair, many of them had been there all along, for good reason.  Most societies that haven’t gotten around to writing, and a good many that have, teach their children by telling them colorful stories, and then teach their adolescents a good deal more by explaining to them what the stories they learned and loved as children actually mean.  Since the end of the Renaissance and the abandonment of the lively sense of the symbolic that permeated medieval and Renaissance culture, only the first half of the equation remained in the Western world; the stories themselves were retained for a few more centuries out of a vague sense of nostalgia, until they were finally pushed aside in our era  by shoddy mass-marketed consumables whose only meaning or lesson is that somebody wanted to make a fast buck.

I’ve come to think, though, that the rise of modern technology over the three centuries since the dawn of the industrial revolution was guided, in no small part, by the lingering echoes of these old stories. No law of nature or of human nature required us to use the gargantuan treasure of nearly free energy we took from the Earth’s carbon stash in precisely the ways that we did, after all. Some of the things we did with all that energy packed enough of an economic or military advantage that it was a safe bet that they’d be tried, no matter what stories were rattling around the crawlspaces of the western world’s collective psyche, but that’s hardly true of all. Visit a large department store sometime, go up and down the aisles, and ask yourself: how many of the things for sale there imitate some detail in a fairy tale?

The magic garments and ointments and jewels that turn serving girls into beautiful princesses, the magic boxes that bring summer in winter and winter in summer, the magic boats that sail under the waves and the magic birds that carry people through the skies, even the beanstalks of smoke and flame that took a modest number of space-suited Jacks (and a very few Jills) up through the clouds to look, unsuccessfully, for a giant’s palace—we’ve got them, or more precisely, we think we’ve got them. In point of fact, what we’ve got are simulacra of these things, the nearest approach to them that you can get by throwing terawatts of energy and the raw materials of an entire planet at them, which in most cases is not actually that close.

In a brilliant passage in Where the Wasteland Ends, a book that has lost none of its relevance or power forty years after its publication, Theodore Roszak compared the dream of flying to the tawdry, tedious experience of air travel. He was writing at a time when airlines still boasted about the quality of their in-flight meals and the leg room their passengers could enjoy on the flight, and when airports were not yet quite so reminiscent of medium-security prisons, complete with armed guards herding inmates toward the confinement that awaits them. Nowadays?  A ride in a New York subway is more inspiring, not to mention more comfortable. The same is true, by and large, of the other simulacra of fairy-tale magic that surround us these days: we may be able to get strawberries in winter, like the little girl in the Brothers Grimm story, but they’ve been picked green, artificially ripened with ethylene, and squirted with imitation strawberry fragrance, and they taste like mildly sugared sawdust.

That is to say, the fake magic that clutters up our lives today doesn’t satisfy the needs it claims to fulfill. We all know this.  We’ve all had our faces rubbed in it as long as we’ve been alive, starting with those childhood Christmas presents that looked so enticing in the store and turned out to be so bleakly vapid once the artificial glow of emotionally manipulative marketing wore off them, and extending straight through the upcoming election, which will inevitably be packed with rhetorical bluster about hope, change, and other vacant buzzwords destined to be discarded in favor of four more years of business as usual the moment the polls close. We all know this, and yet so many of us keep chasing after the latest shiny simulacrum, like greyhounds on a racing track in hot pursuit of a mechanical rabbit they’ll never catch and couldn’t eat if they did.

That futile pursuit of fake magic is a central theme of Kunstler’s book. It’s on display most memorably, perhaps, in his encounters with Google employees who insist that the Long Emergency can’t happen because, like, we’ve got technology, or with the TED conference attendees who flocked to hear the latest rehash of that weary 1950s fantasy, the flying automobile. (I’m asked now and then whether I’ve been invited to give a talk at one of the TED conferences. I haven’t, and I don’t expect ever to get such an invitation; any audience that can be entranced by jabber about flying cars will pretty much by definition not be interested in anything I have to say.) From vertical farming aficionados whose skyscraper-centric vision ignores the rising spiral of factors that are turning skyscrapers into an obsolete architectural form, to green energy wonks who can’t imagine why a society in freefall might not be able to scrape together the resources required for their favorite gargantuan construction program, right up to Ray Kurzweil, the computer geek’s Harold Camping with high-tech Rapture prophecy to match,  Kunstler spends much of the book exploring the ways in which wishful thinking founded on a debased, fairy-tale image of magic has come to replace reasoned thought in contemporary American culture, to our immense peril.

Last Friday’s storm, again, was a useful lesson in the nature of that peril. Behind the magic boxes that keep the heat of summer away stands a huge and hypercomplex system of power plants, transmission lines, transformers, and the whole suite of services and social structures that go into keeping the system running. None of it can be dispensed with, and none of it comes cheap, but it’s only when something pops up on the far end of the probability curve and knocks the system silly that most people are forced to notice that the whole thing doesn’t work by fairy tale magic—and even then a great many of them spend their time complaining because the relevant authorities can’t make the magic pop back into being overnight, like Jack’s beanstalk from those magic beans. The slow shredding of the infrastructure that makes the magic possible rarely enters into the collective conversation of our time, and the logical consequence of that process—the statistically inevitable point at which, for each of us in turn, the magic goes away once and for all—goes not merely unmentioned but unimagined.

Still, that’s where we’re headed. We haven’t yet reached the point at which people in outlying areas whose homes lose electrical power in a storm are quietly informed that they will have to pay the full cost themselves if they want power back, or told that they’ve been put on a list and it may take weeks or months or years before their turn comes up. Still, given the increasingly long delays in restoring power after increasingly frequent weather-related disasters—well, the Bob Dylan line is inescapable: you don’t need a weatherman to know which way the wind blows.  The same wind from a different quarter is blowing through the lives of all those jobless Americans who are losing their unemployment benefits and dropping off the far end of the nation’s joblessness statistics; nonpersons in very nearly an Orwellian sense, they’ve been tossed out of our imaginary happy land of fake magic into a harsher world.  That world is waiting for the rest of us, too, and we’ll each arrive there sooner or later.

Getting ready for that harsh transition, it seems to me, is one of the crucial tasks facing any thoughtful person in our time. It’s not going to be easy, quick or cheap, and a great many of those people who are busy finding reasons why they should cling to their fake magic just that little bit longer are, I’m afraid, going to find it very awkward to discover that the time they spent doing that would have been better spent acclimatizing themselves to the post-fairy tale world.

One of the more useful tools for that task, as I’ve suggested more than once in these essays, is magic—the old art and science of causing change in consciousness in accordance with will, the stuff that I wrote about in my recent book The Blood of the Earth, the stuff that the fake magic of wand-waving movie stars is meant to imitate.  It’s not the only important tool that will be needed, to be sure, but it has something significant in common with every one of the other things that belong on that list:  they all require hard work. You can’t just plant some magic beans in the garden and expect someone or something else to make things happen.  You can’t wait for the authorities to take care of it, because they won’t; you can’t wait for some inventor somewhere to solve the problem for you, because it’s not a problem that can be solved, and the inventors are too busy daydreaming about flying cars to get around to it anyway; you can’t wait for the Rapture or the Singularity or the space brothers or something to make it all go away, because it’s only modern culture’s monumental sense of entitlement that makes people think that some supernatural agency is going to come at a run to bail them out of the consequences of their own actions.

That is to say, if you’re waiting for any of these things, you’re relying on the wrong kind of magic.

Now there are plenty of things that individuals can do right now to make it easier for themselves, their families, and their communities to make the shift to what I’ve called the post-fairy tale world. I wish Kunstler had put a little more of his book into talking about those options; it’s important to try to shake people out of the delusion that everything’s going to be just fine if we just have faith in progress or what have you, but it seems to me that it’s at least as important to give those who do wake up some alternative to the paralyzing despair that comes so easily to those who have been taught all their lives that the only alternative to business as usual is misery and mass death. Even so, Too Much Magic is a useful glance across the topography of the postpeak world in which we now live.

Speaking of books, I mentioned a while back—it was in a discussion of After Oil: SF Visions of a Post-Petroleum World, the forthcoming anthology of peak oil science fiction written by readers of this blog—that if anybody ever decided to create a magazine for post-peak SF, there would be no shortage of talented writers to fill its pages. I’m delighted to say that the challenge has been taken up. Post Peak Fiction, edited by Arwen Hubbard, is a new quarterly magazine with exactly that focus. Hubbard is currently offering subscriptions and soliciting donations via this link on, and is also inviting story submissions via the magazine’s website. I’d encourage readers who enjoyed the story contest, and want to see more of the same, to help get this project under way.

End of the World of the Week #29

"The battle to feed all of humanity is over. In the 1970s hundreds of millions of people will starve to death in spite of any crash programs embarked upon now." Those two sentences opened Paul R. Ehrlich’s 1968 bestseller The Population Bomb, a book that proclaimed in strident terms that with three billion human beings on the planet, overpopulation had gone too far, and mass death in the very near future was the inevitable result.

It was a popular belief at the time, and fed into a great many then-current predictions of imminent doom, not to mention such dystopian films as 1973, Soylent Green. For that matter, it’s all but certain that in the long run population levels on the far side of three billion will prove to be hopelessly unsustainable, though the exact mechanisms by which the excess will be reduced may be rather more complicated and prolonged than Ehrlich proposed. Still, the point that a great many of Ehrlich’s fans have tried to evade since the 1970s is simple enough: his prediction was wrong. The global death toll from starvation during the 1970s was not that much greater than it had been during the 1960s, and world population continued to climb past three billion to its present seven billion without triggering any of the catastrophic scenarios Ehrlich detailed.

—for more failed end time prophecies, see my book Apocalypse Not