Dave Cohen (APSO-USA) on energy, economics and the decline of the American Empire

[IrateCitizen]

I don't know how many of you out there have been following Cohen's recent pieces on Energy Bulletin, but they have been deeply analytical and insightful. As a historian, I especially appreciated his latest piece, drawing parallels between the USA's current predicaments and the decline and fall of Rome. You can take it for what it's worth, but I highly suggest reading the entire piece.


The decline of the American Empire
by Dave Cohen

The decline of Rome was the natural and inevitable effect of immoderate greatness. Prosperity ripened the principle of decay; the causes of destruction multiplied with the extent of conquest; and, as soon as time or accident had removed the artificial supports, the stupendous fabric yielded to the pressure of its own weight. The story of its ruin is simple and obvious; and, instead of inquiring why the Roman empire was destroyed, we should rather be surprised that it had subsisted so long.
—Edward Gibbon, from the Decline and Fall


Perhaps you have noticed a common theme in my recent columns. Each policy proposed to solve our economic, oil or climate problems I have examined has a fatal flaw, and often more than one. New initiatives always seem dead on arrival.

Cap & Trade is not likely to be enacted but if it is, the law would raise energy costs while making only token CO2 emission reductions as in Europe. President Obama put forward a proposal to think about, not build, an expanded passenger or freight rail system in the United States. A “harmonized double standard” for increased CAFE fuel efficiency mandates that cars average 39 miles-per-gallon by 2016, which probably translates to 29 miles-per-gallon in EPA bureaucratese.

On the economic front things are the same. Change we can believe in quickly morphed into a doomed attempt to return our flawed banking system to business as usual. As the Fed and the Treasury continue to bail out the banks, Arianna Huffington tells Tech Ticker’s Aaron Task that—

… the administration is avoiding the big problems …Tim Geithner and Larry Summers were creatures of Wall Street… are like people who still believe the world is flat. They see everything revolving around the Earth and in their case that’s Wall Street. That’s not good if you’re producing maps to navigate.

Even if we require a functioning financial system to speed any “recovery” we might get, few are thinking about what those banks will invest in after our economy bottoms out. More McMansions in the exurbs? More shopping malls? Who will buy these houses miles from nowhere? And then fill up the GMC Yukon to shop at Saks and eat at the Cheesecake Factory? Some over-leveraged consumers will gas up & go, but most will not, at least not as frequently as they used to. People need to pay down their debt as they try to hang on to their low-paying jobs. Our FIRE economy (Finance, Insurance, Real Estate) will try to blow another bubble, but we’re quickly running out of quality assets whose value we can inflate.

The theme that unites our flawed responses to economic and energy problems is futility, defined as—

The quality of having no useful result; uselessness.
Lack of importance or purpose; frivolousness (unworthy of serious attention)

We can not seem to escape futility’s vicious circle....

READ THE REST HERE