'The New Oil Order - The end of the world as we've known it is rapidly underway'

[stuntcat]

(This is on a Korean news site, someone in my population group posted the article.)

The New Oil Order - The end of the world as we've known it is rapidly underway
Nicolas van der Leek

When oil reaches $150 per barrel, Americans will be spending around 12 percent of their incomes on energy. Some believe this value represents a tipping point. It may be. But whether it is $150 or not, we can begin right now to anticipate the changes that are about to happen.

Globalization in Reverse

The world prides itself on its efficiencies. We are able to produce vast amounts of food, and effortlessly move goods and people around the world. It has been a world of choice up to now, with barriers flattened to allow the exchange of trade and world commerce. People and produce have been able to move virtually effortlessly all over the world.

All these selfsame efficiencies also work just as efficiently in reverse -- that is to say, they unravel quickly. An example of an "efficient mechanism" in our lives, particularly in suburbia, is electricity. While electricity can allow us to quickly cook our meals, dry our hair and warm our baths, when it is no longer there, the breakdown is very rapid.

The same is true for the efficiency we get from driving to the mall to stock up on everything we need. When we can no longer do that, suburbia becomes dysfunctional, and a Dysfunctional Suburbia is implicit in the New Oil Order -- and for air travel, and so on.

The World Is Unflattening

Not long ago star New York Times columnist Thomas L. Friedman wrote The World Is Flat. Friedman's book now represents a manual for what is going to disappear quickest. If you read the book critically, you will understand that the unstated premise for virtually all the flattening forces is cheap energy.
Now, many of the companies that Friedman cites as successes are likely to crash and burn. Some of the world's wealthiest companies will disappear off the Fortune 500 in months, if not weeks, never to be seen again. McDonald's and Coca-Cola are just two examples.


And as this process gathers momentum, the world effectively becomes a much larger place, and it becomes difficult to operate with the ease and convenience we have been used to…

Say Goodbye

The first casualty of high oil prices are vast swathes of the poor, especially the rural poor. They may disappear for a while from the aisles of commerce (informal industry mostly) but they will reappear in cities as massive disordered and desperate militias.

Meanwhile, industry can begin by bidding the airline industry a fond farewell. The biggest may survive longer, and Singapore Airlines with its supersized Airbus A380 might be the last to go. Airlines in the Middle East like Qatar Airways may also stay in business for an extra season or two. The future of air travel will belong to an elite few, and airlines as we know them simply will no longer operate. To date over a dozen international airlines have declared bankruptcy in the first 6 months of 2008 alone, including:

Airblue (Pakistan), City Star Airways (UK), Frontier Airlines (US), Nationwide Airlines (South Africa), Palestinian Airlines (Egypt), Tavrey Airlines (Ukraine), Jet4you (Morocco), Euromanx (Isle of Man), Aeropostal (Venezuela) and Silverjet (UK), among others.*

The vast silos that are today's airport buildings may in five years be converted into art of technology museums.

Say goodbye also to the services that rely on airlines, such as courier companies. This means FedEx and UPS, Say goodbye, too, to the likes of Amazon.com.

Giant scale operations -- from air travel, to farming, to industry (think General Motors) -- will scale down drastically.

This represents an implosion in world tourism, which means world spectacles like the FIFA World Cup and the 2012 Olympics are going to be beyond reach for 90 percent of consumers. This also has an impact on all those services that survive on international tourism -- entire hotel chains, car hire companies, restaurants and the like.

Supermarkets like Wal-Mart (US), Carrefour (France), Pick 'n Pay (South Africa), Tesco (UK) and countless others will first face stock shortages for fairly unconventional goods, and then more and more basic goods, including fruit and vegetables. These markets knocked out local markets once upon a time, ruining many local grocers and farming industries. These local operations are about to be reborn, and as they redevelop, these smaller local markets will subsume the supermarkets.

The End of Offshore Operations and Supply Chaining

Multinational corporations will quickly lose both their ability to make use of foreign labor sources, and to do so cheaply. Once again, trade is about to become more local. This means that if your country does not build computers, for example, these devices are about to be priced virtually out of the market.

Electronics are going to go the way of airlines. Generics may survive, and some of the cheapest and most useful will survive better than more complex and far-to-source models. In countries where Internet costs are not minimal, Internet usage will drop drastically.

Media will shrink, from the number of TV channels, to the number of newspapers serving an area, to the number of magazines on the racks. Blogs, however, will continue their surge, but become more functional and community oriented. In some countries -- depending on how long Internet infrastructure has been in place -- newspapers will disappear entirely in favor of Internet-based data. In other countries, particularly where the Internet is still a young industry, newspapers will reclaim all lost ground and the Internet may disappear altogether.

More and more people will be renting, will be without cars and even without mobile phones. The number of the urban poor will swell to alarming levels. All of this represents the end of endless choice.

The Resurgence of Repair Shops

We will no longer be able to afford our throwaway culture. If something breaks, we will have to find people -- technicians -- to fix it. Warrantees and guarantees will become meaningless.

People will have to learn skills again -- not only how to fix things, but also how to make things. When toilet seats no longer arrive in containers at coastal cities, or fishing rods, or piles of clothing, local industries will have to fill this vacuum. It will take time, and it will not be easy. Old people (with skills) will become the new celebrities.

The End of Capitalism

We will see a stock market crash based around the realization (in markets) that not only is economic growth no longer logical, but depleting energy means breakdowns in all the financial architecture that was designed on top of it -- from property markets, to banks, to entire industries, including (of course) the auto and food industries. Obviously, when entire banks fail, so will capitalism and what remains of the financial apparatus.

Money will have little or no value in the future, and commerce will be done via barter, and probably in a disorderly manner. Agriculture will become a big industry, along with other forms of resource management (mining, forestry, etc.).

Disorder

It goes without saying really that all these transitions are likely to be associated with unpleasant levels of public disorder. It is likely that around the world authorities will struggle to maintain law and order. Governments will have a hard time staying relevant and of use to suddenly impoverished mobs. These struggles will place additional strain on those Cheap Oil Relics that survive, for example municipal services and roads. Who will maintain these in a world that can no longer afford very much?

One of the new projects (mentioned above) will be farming, but not so much with machines and the accoutrements of first-world technology. Probably we will have to pay a lot of attention to the soil in order to produce anything of value and in significant quantities. In the new world we will be particularly vulnerable to diseases and pandemics, and also to climate change. With so much to face, individuals will struggle. Communities with talented and skilled craftspersons who work together will do better to adapt. Sharing a common purpose or faith during this period will also benefit these groups over those that have become dispirited and lost their way.


http://english.ohmynews.com/articleview/article_view.asp?at_code=434714
are they being dramatic? I don't know :scared:

[Deja Q]

1. Could be. I know a lot of today's tv shows are just as reactionary and maudlin...

Half of what's going on is a matter of 'common sense'. The other half is a matter of 'wait and see'.

[stuntcat]

2. the OVER-drama

NOT to pick at this article which might be exactly right.. But making films where the end of the world happens in a few days or making dramatic predictions that don't happen fast enough to bother anyone are part of what makes the actual facts hard for a lot of people to take seriously.
It'll be a slow slide into dirty Hell I'm afraid.

[CrispyQ]

3. The Resurgence of Repair Shops

We have an inline water distiller that needed a small electrical repair. It was amazing how difficult it was to find someone who could work on it! We finally found a older German man who ran a small electronic repair shop out of his garage. He had dozens of lamps, toasters, all sorts of small appliances that he was repairing. He was in his late 60s & I wonder, when he retires, who will do this type of work?

[smoogatz]

4. I think they're being a tad hysterical, yes.

Consider the fact that Europeans have been paying $6-8 a gallon for gas for years, and their economies have done just fine, thank you very much.

I don't think major airlines will shut down: they'll consolidate and cut back, and fares will necessarily increase a good bit, but people who have to fly will still have to fly. Same with Fed-Ex: it'll just cost more to ship a package, which means that Amazon will either have to charge more to ship or raise prices a bit, or both. And we're a long way from having hordes of the impoverished marching on urban areas, I'm pretty sure—although increasing crime rates are par for the course in tough economic times. This wouldn't have come from a NORTH korean source, would it? Because it kind of sounds like the "capitalism is about to collapse!" propaganda that used to come out of the Soviet Union when I was a kid.

[skooooo]

5. I agree..

Some of this might happen, but we'll adapt and muddle through.

[stuntcat]

6. the source..

yah, I don't know about that, my group will post some crazy stuff sometimes!
Some of it sounds like Too Much and some of it sounds possible.. like I am afraid that poor people will just be getting poorer the next few decades.

[tama]

9. Time scale

There is nothing hysterical about that quite realistic description except the time scale.

And yes, capitalism is about to collapse: that is what happens when a system based on growth meets the limits of growth.

[Nederland]

14. Capitalism is NOT based on growth

Existing fiat currency systems are based on growth. Capitalism is simply an economic system based upon private ownership of the means of production and pre-dates fiat currency systems by hundreds of years.

[Terry in Austin]

17. The definitions of "capitalism" -- everyone has their favorite

Mine focuses on the essential feature: capital.

Capital is money loaned at interest. That's where the bulk of it comes from. Banking. An economy that depends on capital must divert some of its wealth to servicing the debt of its capital.

At a minimum, then, it is obliged to grow at least by the amount of the debt service, just to stay even. Three percent interest, three percent growth required. To the extent that banking is a definitive feature of capitalism, growth is built-in.

[Nederland]

18. Words are defined by use

Certainly you can define a word any way you like, but unless you are using it in a manner that is consistent with the way other people use that word you aren't going to have much luck communicating. In your case, the definition you provide for capital is unique to you. Everyone else in the world defines capital like this:

http://dictionary.reference.com/browse/capital

Note that while there are many many definitions, none of them match yours.

[Terry in Austin]

19. Thinking for yourself

Okay, your online dictionary doesn't cover it, but come on -- "everyone else in the world?"

You obviously care enough about these issues to have done some reading and given them some thought, and I'm willing to bet you have some thoughts of your own. Maybe you'd be interested in taking up the matter head-on.

I put it to you, then: are you willing to say that it's possible to have capitalism where there is no banking? Can an economy in which money is not loaned at interest be accurately classed as "capitalist?" If so, are there any examples, past or present?

[Nederland]

20. You need to re-read my original post

This is what I said:

Capitalism is NOT based on growth

Existing fiat currency systems are based on growth. Capitalism is simply an economic system based upon private ownership of the means of production and pre-dates fiat currency systems by hundreds of years.

Note I said nothing about money loaned at interest, so I don't really understand the point of your post. I see nothing unsustainable about capitalist economies with systems of banking where money is loaned at interest.

[eleny]

7. I wouldn't want to be one of the "elite few" flying in airplanes

[Terry in Austin]

16. ...and the cars that are left, they'll need to be armored!

[FirstLight]

8. This is a more rational timeline/explanation that I have seen out there

I have been trying to se what is coming in realistic terms for a while, and the understanding of peak oil/cheap energy and sustainability make this actually seem viable.

It is going to be messy no doubt. Community driven culture is going to be a very hard shift for most.
Many probably won't survive when you take into account the increasing disasters/weather/warming issues... we DO have cause for concern. And I fear there is little more to do than hold on for a bumpy ride.

Learn how to love your neighbor, because you may end up helping one another through the long hard winter.
Learn to be of some use to your fellow man, because the tribe needs ALL talents. Cultivate yours.
And enjoy the ease
of your life every day, because the other shoe is primed to drop, and it could very well be sooner than later.

I have glimpses as I go through my day sometimes..."I am gonna miss hot baths." "Boy, I'll miss the Big Daddy Burger downtown"
"Wow, what would I do without running water for my yard?" ...etc...

I don't think it's bad to notice these things we take for granted, and perhaps see your other options...

[stuntcat]

10. the water..

every possible story of what'll happen with water is scaring me. I do not take water for granted and I'm learning ways to use less, but I admit I need a lot. It's the thing that scares me, the water, I'm afraid we'll be fighting over it before my time is up :scared:

[FirstLight]

11. At least I live in the sierras and could get water from several streams

or the Lake if I had to...but having a tank or a well of my own would be ideal...

and, oh - to be off the grid! I have a plan for a cheap solar generator, I wanna get my son to build one!

[kestrel91316]

12. Word:

Metal roof.
Rain gutters.
Cistern.
Hand pump.

If I were in your area, I would do it YESTERDAY.

[starroute]

13. I believe at most about 1/3 of it -- if that

If it costs too much to move large stacks of physical objects around -- especially items that are going to be used for a day and then turn into trash -- then newspapers, for example, are simply not going to replace the Internet. Electronics of all sorts will prosper instead, because they save energy compared to any alternative. Electronic media don't have to be manufactured, transported, or disposed of, while physical media do.

Similarly, there's no way that Amazon's going to revert to the old system of publishers with warehouses full of books, nationwide distribution systems, and brick-and-mortar stores that have to have heat, light, and so forth. Two-day delivery may vanish, and I can see ebooks and localized print-on-demand getting a lot bigger, but there will still be books and a central hub like Amazon will be the most energy-efficient way to provide them.

Because the writer seems to be suffering a failure of imagination in those areas, I'm less inclined to trust them on the rest -- much of which they seem to be pulling out of their ass. Money's not going to disappear -- well, physical bills and coins might, because electronic cash doesn't have to be manufactured or hauled around. But there's no way we're going to revert to an early Neolithic barter economy.

The most plausible suggestions are that more will be done locally and more will be recycled. But then, we've known that for the last 40 years. The only thing new is that it will happen because we have no choice and not because it's a Good Idea.

Perhaps the best things I can see coming out of all this is that having to do stuff locally will put more people back to work, that kicking the multinationals out of the equation will stop the insanity of forcing people with jobs to work far too many hours while others have no jobs at all, and that spreading the work around more evenly will make it possible to have real vacations again in order to take advantage of what will necessarily be more leisurely modes of travel.

[HamdenRice]

15. The stuff about the rural poor seems exactly backwards

One of the possible benefits of high energy prices in developing poor, rural countries is that rural labor may become more valuable. In other words, for the last 100 years, tractors have replaced human and animal power, pushing people into the slums of cities as small farms were replaced by large mechanized farms.

High energy prices could mean a return to horticulture, and dramatic increases in rural employment. And since many studies have shown that in such circumstances, small family farms are more efficient than large farms when they are using the same technology, this could lead to a market driven break up of plantations and haciendas.

Overall rural "hands" are about to become much more valuable.

[Nederland]

21. The End of the World? Again?

God, this is like the fifth time the end of the world has been upon us...