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The Story of Stuff

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http://www.businessspectator.com.au/bs.nsf...EQ?OpenDocument
Martin Wolf, Financial Times

No turning back

Oil at $US200 a barrel: that was the warning from Goldman Sachs, published last week. The real price is already at an all-time high. At $US200 it would be twice as high as it was in any previous spike. Even so, it would be a mistake to focus in shock only on the short-term jump in prices. The bigger issues are longer term.

Here are three facts about oil: it is a finite resource; it drives the global transport system; and if emerging economies consumed oil as Europeans do, world consumption would jump by 150 per cent. What is happening today is an early warning of this stark reality. It is tempting to blame the prices on speculators and big bad oil companies. The reality is different.

Demand for oil grows steadily, as the vehicle fleets of the world expand. Today, the US has 250 million vehicles and China just 37 million. It takes no imagination to see where the Chinese fleet is headed. Other emerging countries will follow China’s example.

Meanwhile, spare capacity in members of the Organisation of the Petroleum Exporting Countries is currently at exceptionally low levels, while non-Opec production has equally consistently disappointed expectations.

It looks increasingly hard to expand supply by the annual amount of about 1.4 million barrels a day needed to meet demand. This means an extra Saudi Arabia every seven years. According to the International Energy Agency, almost two-thirds of additional capacity needed over the next eight years is required to replace declining output from existing fields. This makes the task even harder than it seems. As the latest World Economic Outlook from the International Monetary Fund adds, the fact that peak production is reached sooner, because of today’s efficient technologies, also means that subsequent declines are steeper.

This is not to argue that speculation has played no role in recent rises in prices. But it is hard to believe it has been a really big one. True, the dollar price has risen sharply, but that is partly the result of the decline in the dollar’s relative value. As I have argued before, if speculation were raising prices above the warranted level, one would expect to see inventories piling up rapidly, as supply exceeds the rate at which oil is burned. Yet there is no evidence of such a spike in inventories, as Goldman Sachs and the IMF point out.

Similarly, it is not even true that the investment needed to boost the constrained production capacity has been lagging. The WEO shows that nominal investment by national and international oil companies more than doubled between 2000 and 2006. But real investment hardly increased, because of a global scarcity of rigs and associated skilled labour services. Against this background, it seems far more likely that such speculation as there is has been stabilising, rather than destabilising: in other words, it is moving prices in the right direction, in order to reduce demand.

Will the high prices succeed in doing this? Certainly. Demand has to match supply for a simple reason: we cannot burn oil that does not exist.

The price spikes of the 1970s were followed by big absolute falls in demand and output. This was partly because of the recessions and partly because of rising efficiency. Both forces should work again this time, but to a much smaller extent. The slowdown in the US economy is indeed likely to be significant. Slowdowns will also occur in western Europe and Japan and even in the emerging world. But the latter will still grow rapidly. Overall, the world economy – and so world oil demand – is likely to continue to grow reasonably briskly. Similarly, the improved efficiency of use of petroleum, as people switch to more efficient vehicles, notably in north America (where the room for doing so is so large), will be offset by the rising tide of demand for motorised transport in the world’s fast-growing emerging countries.

On balance, it is quite unlikely that aggregate demand for oil will collapse, as it did after the two previous price spikes, just as it is unlikely that massive net new oil supplies will come on stream in the near future. This does not mean that prices will remain as high as they are today for the indefinite future: such stability is improbable. But it means we should expect a sustained period of relatively high prices even if “peak oil” theorists are proved wrong. If proved right, this would be true in spades.

So what should be the response to these simple realities? Here are some obvious “do nots” and “dos”.

First, do not blame conspiracies by speculators, oil companies or even Opec. These are the messengers. The message is one of fundamental shifts in demand and supply. If speculators push prices up in response, they are helping the adjustment. Even if Opec keeps cutting output back, it is preserving a valuable resource for the future.

Second, do not blame the emerging countries for their growing demand. Citizens of rich countries must adjust to the higher prices of resources that the rise of the emerging countries entails. The only alternative is to attempt to destroy those hopes. That would be a blunder and a crime.

Third, understand that prices at these levels are now playing a big macro-economic role. At $100 a barrel the annual value of world oil output would be close to $US3,000 billion. That is 5 per cent of world gross product. The only previous years in which it was higher than that were 1979 to 1982.

Fourth, adjust to high prices, which will play a big part in encouraging more efficient use of this finite resource and ameliorating climate change. The current shock offers a golden opportunity to set a floor on prices, by imposing taxes on oil, fossil fuels or carbon emissions.

Fifth, do try to reach global agreement on a pact on trade in oil based on the fundamental principle that producers will be allowed to sell their oil to the highest bidder. In other words, the global oil market needs to remain integrated. Nobody should use military muscle to secure a privileged position within it.

Finally, do become serious about investing in basic research into alternative technologies. Energy self-sufficiency is an implausible goal. Investing for a post-oil future is not.

We are no longer living in an age of abundant resources. It is possible that huge shifts in supply and demand will reverse this situation, as happened in the 1980s and 1990s. We can certainly hope for that happy outcome. But hope is not a policy.

The great event of our era is the spread of industrialisation to billions of people. The high prices of resources are the market’s response to this transforming event. The market is saying that we must use more wisely resources that have now become more valuable. The market is right.

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http://globalpublicmedia.com/saying_goodbye_to_air_travel
Richard Heinberg, Saying Goodbye to Air Travel

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Can we invade more Arab countries nao?

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via EB


Peak oil for teenagers (video)
Brian Kaller, YouTube
Journalist Brian Kaller speaks to 300 teenaged students in County Kildare, Ireland about peak oil and climate change. More of Kaller's writing at:
"Running on Empty," August 2004 - www.energybulletin.net/1448.html

The event was hosted by FADA, a volunteer group preparing local villages for a peak oil/climate change crisis. FADA members have:
- Created a mobile gardening unit to turn lawns into vegetable gardens;
- Hosted talks by TV personalities Duncan Stewart and Eddie Hobbs;
- Organised an Energy Fair to publicise peak oil to thousands of people;
- Published a weekly newspaper column on preparing for the crisis.
- Held seminars on gardening, permaculture and installing alternative energy in the home.

---
From email:
I wanted to invite Energy Bulletin readers to a talk I gave to students in Ireland.

I have been giving talks on peak oil and climate change here for the last few years, and we happened to film this one, given to about 300 teenagers at a theatre in Newbridge, County Kildare. It's a little general -- I was told to boil peak oil, climate change and the good news into 25 minutes -- but you are welcome to use it. It was shown in conjunction with the film "The Power of Community," about Cuba's oil crisis.

Part 1 - Peak Oil http://www.youtube.com/watch?v=p8pPh1-KO_Q

Part 2 - Climate Change http://www.youtube.com/watch?v=Jbf-n3ECoh4

Part 3 - The Fifties http://www.youtube.com/watch?v=Nr6hGiitZbA

By the way, I am starting a blog, "Restoring Mayberry,".

Feel free to check in.

Brian Kaller
County Kildare Ireland

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http://seattlepi.nwsource.com/local/348200_dirt22.html

Tuesday, January 22, 2008
Last updated 7:57 a.m. PT


By TOM PAULSON
P-I REPORTER

The planet is getting skinned.

While many worry about the potential consequences of atmospheric warming, a few experts are trying to call attention to another global crisis quietly taking place under our feet.

Call it the thin brown line. Dirt. On average, the planet is covered with little more than 3 feet of topsoil -- the shallow skin of nutrient-rich matter that sustains most of our food and appears to play a critical role in supporting life on Earth.

"We're losing more and more of it every day," said David Montgomery, a geologist at the University of Washington. "The estimate is that we are now losing about 1 percent of our topsoil every year to erosion, most of this caused by agriculture."

"It's just crazy," fumed John Aeschliman, a fifth-generation farmer who grows wheat and other grains on the Palouse near the tiny town of Almota, just west of Pullman.

"We're tearing up the soil and watching tons of it wash away every year," Aeschliman said. He's one of a growing number of farmers trying to persuade others to adopt "no-till" methods, which involve not tilling the land between plantings, leaving crop stubble to reduce erosion and planting new seeds between the stubble rows.

Montgomery has written a popular book, "Dirt," to call public attention to what he believes is a neglected environmental catastrophe. A geomorphologist who studies how landscapes form, Montgomery describes modern agricultural practices as "soil mining" to emphasize that we are rapidly outstripping the Earth's natural rate of restoring topsoil.

"Globally, it's clear we are eroding soils at a rate much faster than they can form," said John Reganold, a soils scientist at Washington State University. "It's hard to get people to pay much attention to this because, frankly, most of us take soil for granted."

The National Academy of Sciences has determined that cropland in the U.S. is being eroded at least 10 times faster than the time it takes for lost soil to be replaced.

The United Nations has warned of worldwide soil degradation -- especially in sub-Saharan Africa, where soil loss has contributed to the rapidly increasing number of malnourished people.

Healthy topsoil is a biological matrix, a housing complex for an incredibly diverse community of organisms -- billions of beneficial microbes per handful, nitrogen-fixing fungi, nutrients and earthworms whose digestive tracts transform the fine grains of sterile rock and plant detritus into the fertile excrement that gave rise to the word itself ("drit," in Old Norse).

As such, true living topsoil cannot be made overnight, Montgomery emphasized. Topsoil grows back at a rate of an inch or two over hundreds of years. Very slowly.

"Globally, it's pretty clear we're running out of dirt," Montgomery said.

Ron Myhrum, state soil scientist with the U.S. Department of Agriculture's office in Spokane, agreed that global soil loss is a huge problem. But Myhrum said erosion rates in the Northwest region have improved recently because of better conservation farming practices, including federal payments to farmers to leave some natural ground cover in highly erodible areas.

"We don't have the kind of dust storms here we used to have," Myhrum said. "What's more alarming to me than erosion is conversion of farmland to urban use."

That is indeed another way to lose soil -- paving it over. Judy Herring, manager of King County's farmland preservation program, said the county has lost 60 percent of its farmland since the 1960s. In 1979, Herring said, voters approved a bond program that buys back farmland to protect it from development (and has done this for 13,200 acres so far).

But while some land is lost to development, pollution or changing weather patterns, Montgomery, Reganold and others say global soil loss is a crisis mostly rooted in agriculture.

"Erosion rates have improved here, but that doesn't mean they're good," Reganold said. Topsoil clearly is still being stripped off faster than it can be regenerated, he said.

Aeschliman, the Palouse farmer, a stocky and energetic man who doesn't seem to notice that he's in his 60s, stood on a dirt road looking at the difference between his land and that of a neighbor. Because most neighbors are relatives, he did not provide any names here.

"Just look at that!" he bellowed, pointing to a series of water-carved cracks and gouges running down a recently tilled field of wheat. Every year, he said, these fields are tilled and the rains come, washing the soil down into the road so deep the county routinely has to dig it out. The rest of the soil runs off to the Snake River and, eventually, to the Pacific.

"Here, look at this stuff," Aeschliman said as he held up a handful of the fine brown silt that had eroded off his neighbor's (cousin's) hillside. "Now, look over here."

He walked across the road to his no-till wheat field. Unlike the rolling hills of loose dirt on the tilled field, Aeschliman's field looks more like a shag rug, with its rows of dead wheat stubble. He reached down into the dirt and pulled out a coarsely textured, much darker clump of dirt, roots and debris.

"This soil is full of worms, bacteria and all sorts of life," Aeschliman said. "And it stays put. That stuff over there (waving his thick hand back behind him) is just powder, brown dust. It's dead. There's no worms, no life in it."

Thirty years ago, Aeschliman was one of the first in the Palouse to grow his grains using no-till farming methods. He's an ardent no-till proselytizer today, but he didn't abandon tilling the fields based on some organic epiphany or desire to save the world.

"I just got tired of all the mud," Aeschliman said. The family home, built in the 1880s, sits at the base of a long drainage off the rolling wheat fields. Every spring, with the tilling and the rain, his home would be a foot deep in muddy runoff.

No-till farming could do a lot to reduce topsoil erosion, Reganold said, but it's not without its downsides. Switching to no-till farming requires heavy upfront investment and learning new techniques, he said, and also tends to depend more on herbicides because the weeds are no longer controllable by plowing them into the soil.

Organic farming methods also can reduce soil loss, Reganold said. He cited his own research, which has shown a marked increase in soil health, water retention and regrowth when organic methods are used rather than the traditional methods.

A regional association of farmers and other proponents of no-till agriculture, also known as direct-seed farming, is holding its annual meeting in Kennewick next week. Aeschliman is one of the founders of the organization, the Pacific Northwest Direct Seed Association, and is happy to see that no-till farming is growing in popularity.

"It's both good for the soil and good for your pocketbook," he said.

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http://seattlepi.nwsource.com/local/348201_dirtsider22.html

Sustainable farming is not an easy sell
Organization tries to make no-till method pay off in the marketplace

By TOM PAULSON
P-I REPORTER

Eat local food for dirt's sake.

That might be the simplest way to describe a guiding principle of Shepherd's Grain, a small, commercial cooperative launched by Pacific Northwest farmers hoping to market their wheat flour grown using "no-till" agricultural methods.

"The single most important factor in sustainable farming today is preventing soil erosion and maintaining healthy soil," said Karl Kupers, one of the founders of Shepherd's Grain.

"We want our farming methods to be sustainable, but we have to make this sustainable as a business also," Kupers said. "You can hug and kiss and talk about sustainability all you like, but this still has to pay the bills."

The financial incentive of U.S. agriculture, he said, still heavily favors tilling fields for single-crop operations. Even the consumer push for organic food tends to favor big operations over the small farms, he said.

"Heck, today you can buy organic food in Seattle that was made in China," Kupers said. It's a hotly debated topic, he said, but consumers shouldn't assume that all organic food is necessarily better for the environment, or for the soil.

The primary mission of Shepherd's Grain, he said, was to figure out how to get the marketplace to reward local, no-till farmers. Kupers and Fred Fleming, along with a dozen family farms in Eastern Washington, Oregon and Idaho, have tried for the past few years to get bakers, bread makers and other grain buyers to use only no-till flour.

It's been a tough sell, but some are starting to get on board.

"We had planned to go organic," said Josh Dorf, chief executive of the Stone-Buhr Flour Co. Five years ago, Dorf bought the 100-year-old Seattle brand name back from its parent company, Unilever, with the aim of resurrecting it as a small, natural flour and grain maker.

"When I met Karl and Fred and learned more about what they were doing, I thought this was way more important than going organic," he said. "The primary focus is on preserving the land. There's no government certification or anything official that defines 'sustainable,' but we really wanted to use their product."

Stone-Buhr, with headquarters in San Francisco, now offers Shepherd's Grain flour as "environmentally friendly" and "the first locally grown all-purpose flour in the Northwest." The Stone-Buhr Shepherd's Grain flour is sold at many regular grocery stores.

Though the definition of sustainable food remains unofficial, and perhaps debatable, an organization based in Portland is attempting to give consumers some guidance. The Food Alliance (foodalliance.org) partners with the U.S. Department of Agriculture to operate the largest third-party certification program for sustainable foods.

"Farmers know that the key thing to sustainable farming is the soil," Kupers said. He said the Food Alliance, which has certified Shepherd's Grain flour as sustainably grown, is one way consumers can get involved.

The debates won't end and the changes won't happen overnight, Kupers said. Organic farming contributes to soil erosion, he said, but no-till farming depends on the use of pesticides (if less fertilizer, in the long run).

"People often buy organic because of a personal concern about safety and health," he said. "Getting consumers to think of their food in terms of the problem of soil erosion, or sustainability, is certainly more of a marketing challenge."

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http://www.ft.com/cms/s/0/cb8af0b4-2825-11...?nclick_check=1

Airlines face battle for survival

By Kevin Done, Aerospace Correspondent in Paris

Published: May 22 2008 19:54 | Last updated: May 22 2008 19:54

The structure of the world airline industry is going to change “profoundly”, Jean-Cyril Spinetta, chairman and chief executive of Air France-KLM, warned on Thursday, as carriers struggle to come to terms with a doubling of the oil price in the past 12 months and weakening economic growth.

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http://c-realmpodcast.podomatic.com/entry/...T13_50_32-07_00

KMO talks first with James Howard Kunstler about his new novel, World Made By Hand. Next he speaks with Dmitry Orlov about the 5 stages of collapse and about his book, Reinventing Collapse: The Soviet Example and American Prospects, which has just been released. KMO closes the podcast with a reading on the difference between "breakdown" and "collapse" from Thomas Homer-Dixon's excellent book The Upside of Down: Catastrophe, Creativity, and the Renewal of Civilization.

mp3

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http://sharonastyk.com/2008/05/21/peak-ene...tions-for-food/
Peak Energy and an Overview of Its Implications for Food

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http://www.smh.com.au/news/world/peak-oil-...1183102727.html


May 24, 2008

China's devastating earthquake gave the people of Sichuan an early taste of a world that is running out of fuel.

Thousands of families slept in their cars outside petrol stations because the province's oil infrastructure had been disrupted and its remaining fuel supplies diverted to the rescue effort. Truck drivers loitered patiently for local officials to raise their diesel rations beyond a paltry 100 yuan ($14), while taxi drivers refused to take reporters from Mianyang city to the earthquake disaster zone because they could not get enough petrol for the ride.

Kevin Tu, an energy consultant in Canada, says the earthquake and Chinese Government efforts to build huge strategic reserves in time for the Olympic Games in August will have a "huge impact" on the international market.

And yet oil demand in China and other developing countries is growing so fast, and the international market is so stretched, that international oil prices smashed through to new records this week. Sydney petrol stations were charging as much as $1.60 a litre, but there may be much worse to come. Australian petrol refineries are yet to receive oil that was bought at the new record prices.

On Thursday the world benchmark oil price hit $US135 a barrel. It has more than doubled in a year and is now higher than during the oil supply shocks of 1974 and 1980, even after adjusting for inflation.

Many politicians and the OPEC cartel of oil-exporting countries blame hedge fund speculators for pushing up the price. But the reality is probably less complicated and more serious.

"The only way to [artificially] drive prices up would be to physically hoard more oil, but stocks are at an all-time low," says Peter Downes, a former Treasury official at the Centre for International Economics in Canberra.

The developed world is adjusting to a world of tight oil supply and high petrol prices. Australians are driving more efficient cars and drifting back to public transport. Even the United States, which consumes a quarter of the world's oil, reduced its oil consumption in 2006.

The International Monetary Fund's World Economic Outlook shows the rich countries that make up the OECD reduced oil consumption in each of the past two years. Japan, the world's efficiency leader, dramatically reduced petrol consumption in the 1970s and still managed to reduce oil consumption by almost 10 per cent over the past decade. But energy efficiency improvements in the rich world are being swamped by the developing world's rush towards rich-country living standards.

In 2003 China overtook Japan to be the world's second largest oil consumer. China now consumes 50 per cent more oil than Japan. Chinese consumption has risen by more than 7 per cent a year since 1990.

At this growth rate, China would equal America's current oil consumption by 2020 and double it by 2030.

About 1200 new cars are being added every day in Beijing alone. And yet only 3.3 in every 100 Chinese people own cars, compared with 77 in the United States. Chinese citizens consume one-third as much oil as Mexicans and one-twelfth as much as Americans. The country's thirst for oil is at its early stages, and India is close behind.

The roads of Bangalore, India's IT boom town, are perpetually gridlocked as the city's new middle-class families rush to buy their first family cars. The number of new cars being sold in India is expected to surge from 1.3 million this year to 4 million a year over the next eight years. Last year about a dozen new car models were released in India. This year 75 new models are expected. One of them, the Tata Nano, will sell for about $2600 and open the dream of car ownership to a huge new cohort of Indian families.

India's use of oil doubled between 1992 and 2005 and has continued to rocket.

China, India and other fast-growing developing countries have made matters worse with huge and rapidly growing fuel subsidies and price distortions, which they dare not end at a time when inflation has become a pressing political problem.

But developing world aspirations are colliding with the reality of finite oil supplies. This oil-price shock has been five years in the making but it may only just be beginning.

James Hamilton, professor of economics at the University of California, San Diego, believes the developing world will be forced to choose a different dream.

"I cannot imagine that the projected path for China will ever become a reality," he wrote on his Econbrowser website this week. "Oil prices have to rise to whatever value it takes to prevent that from happening."

There is simply not enough oil in the world for China, India and the developing world to emulate rich-world consumption standards.

Traditionally, economists have been sceptical about the idea of "peak oil" - a point at which oil production will necessarily decline - believing that rising prices will drive oil companies to do what ever it takes to extract more oil from previously inaccessible places, such as Canadian oil sands or Brazil's offshore discoveries, kilometres beneath the seabed.

And yet oil prices have risen seven-fold in five years and there is little in new production or discoveries. Existing oil fields, meanwhile, are running out faster than anyone predicted. The further ahead that analysts look, the worse the problem gets. Investment bank Goldman Sachs now expects oil prices to average $US141 in the second half of this year, before rising as high as $US200.

Tellingly, this week the price of oil to be delivered years into the future rose three times as fast as prices for delivery this July. On Friday it cost more than $US145 to buy oil for delivery in 2016 - up an astonishing $US19 in just one week. While OPEC oil producers are deliberately curtailing production, they, too, will face physical limits.

Downes predicts world oil production will peak between 2020 and 2030. Some outlying commentators say the moment will arrive even sooner. Germany's Energy Research Group says the phrase "peak oil" is grammatically misleading because oil production has peaked.

For Australian motorists, the question is what international oil price will it take to force developing world consumers to choose a different path, and what will that do to the Australian economy.

It is a little known fact that only about one-third of the oil used in Australia is dispensed to consumers at the petrol pump. The rest is embedded in transport costs for other goods as well as in oil products such as plastic.

This indirect, larger oil shock impact may take nine months to flow through to consumer prices. And while Australia and the world survived oil prices rising by $US40 in four years to the middle of last year, they have now watched prices jump a further $US75 in 12 months. At the same time, prices for almost all other commodities have shot through the roof.

"You add all these together and it roughly equates to what we saw in 1980 and 1974 - major supply side shocks," Downes says. "Financial markets have a false sense of security about what impact this will have."

Downes estimates the recent commodity price shock will push inflation up by about 2 percentage points across the OECD, including Australia, at a time when inflation is already uncomfortably high.

Citigroup's chief economist in Australia, Paul Brennan, yesterday said he has calculated that an average oil price of $US141 a barrel this year would push inflation up by 3.5 percentage points across the Asian region and take 1.5 percentage points off regional gross domestic product growth.

Australia remains a lucky country. It may import a lot of oil but it is a huge net exporter of energy and resource commodities. The oil price shock is part of a broader commodities boom that will continue to make Australians richer. Mortgaged home owners will pay the price, if the Reserve Bank is again compelled to raise interest rates to keep inflation under control.

This story was found at: http://www.smh.com.au/articles/2008/05/23/1211183102727.html

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http://apnews.myway.com/article/20080524/D90S5MLG0.html
Energy fears looming, new survivalists prepare
Email this Story

May 24, 2:12 PM (ET)

By SAMANTHA GROSS


(AP) Peter Laskowski stacks firewood at his remote home in Waitsfield, Vt., Friday, April 11, 2008....
Full Image


BUSKIRK, N.Y. (AP) - A few years ago, Kathleen Breault was just another suburban grandma, driving countless hours every week, stopping for lunch at McDonald's, buying clothes at the mall, watching TV in the evenings.

That was before Breault heard an author talk about the bleak future of the world's oil supply. Now, she's preparing for the world as we know it to disappear.

Breault cut her driving time in half. She switched to a diet of locally grown foods near her upstate New York home and lost 70 pounds. She sliced up her credit cards, banished her television and swore off plane travel. She began relying on a wood-burning stove.

"I was panic-stricken," the 50-year-old recalled, her voice shaking. "Devastated. Depressed. Afraid. Vulnerable. Weak. Alone. Just terrible."


(AP) Peter Laskowski feeds his chickens and sheep at his remote home in Waitsfield, Vt., Friday, April...
Full Image
Convinced the planet's oil supply is dwindling and the world's economies are heading for a crash, some people around the country are moving onto homesteads, learning to live off their land, conserving fuel and, in some cases, stocking up on guns they expect to use to defend themselves and their supplies from desperate crowds of people who didn't prepare.

The exact number of people taking such steps is impossible to determine, but anecdotal evidence suggests that the movement has been gaining momentum in the last few years.

These energy survivalists are not leading some sort of green revolution meant to save the planet. Many of them believe it is too late for that, seeing signs in soaring fuel and food prices and a faltering U.S. economy, and are largely focused on saving themselves.

Some are doing it quietly, giving few details of their preparations - afraid that revealing such information as the location of their supplies will endanger themselves and their loved ones. They envision a future in which the nation's cities will be filled with hungry, desperate refugees forced to go looking for food, shelter and water.

"There's going to be things that happen when people can't get things that they need for themselves and their families," said Lynn-Marie, who believes cities could see a rise in violence as early as 2012.


(AP) Peter Laskowski plants vegetables at his remote home in Waitsfield, Vt., Friday, April 11, 2008....
Full Image
Lynn-Marie asked to be identified by her first name to protect her homestead in rural western Idaho. Many of these survivalists declined to speak to The Associated Press for similar reasons.

These survivalists believe in "peak oil," the idea that world oil production is set to hit a high point and then decline. Scientists who support idea say the amount of oil produced in the world each year has already or will soon begin a downward slide, even amid increased demand. But many scientists say such a scenario will be avoided as other sources of energy come in to fill the void.

On the PeakOil.com Web site, where upward of 800 people gathered on recent evenings, believers engage in a debate about what kind of world awaits.

Some members argue there will be no financial crash, but a slow slide into harder times. Some believe the federal government will respond to the loss of energy security with a clampdown on personal freedoms. Others simply don't trust that the government can maintain basic services in the face of an energy crisis.

The powers that be, they've determined, will be largely powerless to stop what is to come.

Determined to guard themselves from potentially harsh times ahead, Lynn-Marie and her husband have already planted an orchard of about 40 trees and built a greenhouse on their 7 1/2 acres. They have built their own irrigation system. They've begun to raise chickens and pigs, and they've learned to slaughter them.

The couple have gotten rid of their TV and instead have been reading dusty old books published in their grandparents' era, books that explain the simpler lifestyle they are trying to revive. Lynn-Marie has been teaching herself how to make soap. Her husband, concerned about one day being unable to get medications, has been training to become an herbalist.

By 2012, they expect to power their property with solar panels, and produce their own meat, milk and vegetables. When things start to fall apart, they expect their children and grandchildren will come back home and help them work the land. She envisions a day when the family may have to decide whether to turn needy people away from their door.

"People will be unprepared," she said. "And we can imagine marauding hordes."

So can Peter Laskowski. Living in a woodsy area outside of Montpelier, Vt., the 57-year-old retiree has become the local constable and a deputy sheriff for his county, as well as an emergency medical technician.

"I decided there was nothing like getting the training myself to deal with insurrections, if that's a possibility," said the former executive recruiter.

Laskowski is taking steps similar to environmentalists: conserving fuel, consuming less, studying global warming, and relying on local produce and craftsmen. Laskowski is powering his home with solar panels and is raising fish, geese, ducks and sheep. He has planted apple and pear trees and is growing lettuce, spinach and corn.

Whenever possible, he uses his bicycle to get into town.

"I remember the oil crisis in '73; I remember waiting in line for gas," Laskowski said. "If there is a disruption in the oil supply it will be very quickly elevated into a disaster."

Breault said she hopes to someday band together with her neighbors to form a self-sufficient community. Women will always be having babies, she notes, and she imagines her skills as a midwife will always be in demand.

For now, she is readying for the more immediate work ahead: There's a root cellar to dig, fruit trees and vegetable plots to plant. She has put a bicycle on layaway, and soon she'll be able to bike to visit her grandkids even if there is no oil at the pump.

Whatever the shape of things yet to come, she said, she's done what she can to prepare.

[papabear]

http://www.washingtonpost.com/wp-dyn/conte...2302456_pf.html
Wake Up, America. We're Driving Toward Disaster.

By James Howard Kunstler
Sunday, May 25, 2008; B03

Everywhere I go these days, talking about the global energy predicament on the college lecture circuit or at environmental conferences, I hear an increasingly shrill cry for "solutions." This is just another symptom of the delusional thinking that now grips the nation, especially among the educated and well-intentioned.

I say this because I detect in this strident plea the desperate wish to keep our "Happy Motoring" utopia running by means other than oil and its byproducts. But the truth is that no combination of solar, wind and nuclear power, ethanol, biodiesel, tar sands and used French-fry oil will allow us to power Wal-Mart, Disney World and the interstate highway system -- or even a fraction of these things -- in the future. We have to make other arrangements.

The public, and especially the mainstream media, misunderstands the "peak oil" story. It's not about running out of oil. It's about the instabilities that will shake the complex systems of daily life as soon as the global demand for oil exceeds the global supply. These systems can be listed concisely:

The way we produce food

The way we conduct commerce and trade

The way we travel

The way we occupy the land

The way we acquire and spend capital

And there are others: governance, health care, education and more.

As the world passes the all-time oil production high and watches as the price of a barrel of oil busts another record, as it did last week, these systems will run into trouble. Instability in one sector will bleed into another. Shocks to the oil markets will hurt trucking, which will slow commerce and food distribution, manufacturing and the tourist industry in a chain of cascading effects. Problems in finance will squeeze any enterprise that requires capital, including oil exploration and production, as well as government spending. These systems are all interrelated. They all face a crisis. What's more, the stress induced by the failure of these systems will only increase the wishful thinking across our nation.

And that's the worst part of our quandary: the American public's narrow focus on keeping all our cars running at any cost. Even the environmental community is hung up on this. The Rocky Mountain Institute has been pushing for the development of a "Hypercar" for years -- inadvertently promoting the idea that we really don't need to change.

Years ago, U.S. negotiators at a U.N. environmental conference told their interlocutors that the American lifestyle is "not up for negotiation." This stance is, unfortunately, related to two pernicious beliefs that have become common in the United States in recent decades. The first is the idea that when you wish upon a star, your dreams come true. (Oprah Winfrey advanced this notion last year with her promotion of a pop book called "The Secret," which said, in effect, that if you wish hard enough for something, it will come to you.) One of the basic differences between a child and an adult is the ability to know the difference between wishing for things and actually making them happen through earnest effort.

The companion belief to "wishing upon a star" is the idea that one can get something for nothing. This derives from America's new favorite religion: not evangelical Christianity but the worship of unearned riches. (The holy shrine to this tragic belief is Las Vegas.) When you combine these two beliefs, the result is the notion that when you wish upon a star, you'll get something for nothing. This is what underlies our current fantasy, as well as our inability to respond intelligently to the energy crisis.

These beliefs also explain why the presidential campaign is devoid of meaningful discussion about our energy predicament and its implications. The idea that we can become "energy independent" and maintain our current lifestyle is absurd. So is the gas-tax holiday. (Which politician wants to tell voters on Labor Day that the holiday is over?) The pie-in-the-sky plan to turn grain into fuel came to grief, too, when we saw its disruptive effect on global grain prices and the food shortages around the world, even in the United States. In recent weeks, the rice and cooking-oil shelves in my upstate New York supermarket have been stripped clean.

So what are intelligent responses to our predicament? First, we'll have to dramatically reorganize the everyday activities of American life. We'll have to grow our food closer to home, in a manner that will require more human attention. In fact, agriculture needs to return to the center of economic life. We'll have to restore local economic networks -- the very networks that the big-box stores systematically destroyed -- made of fine-grained layers of wholesalers, middlemen and retailers.

We'll also have to occupy the landscape differently, in traditional towns, villages and small cities. Our giant metroplexes are not going to make it, and the successful places will be ones that encourage local farming.

Fixing the U.S. passenger railroad system is probably the one project we could undertake right away that would have the greatest impact on the country's oil consumption. The fact that we're not talking about it -- especially in the presidential campaign -- shows how confused we are. The airline industry is disintegrating under the enormous pressure of fuel costs. Airlines cannot fire any more employees and have already offloaded their pension obligations and outsourced their repairs. At least five small airlines have filed for bankruptcy protection in the past two months. If we don't get the passenger trains running again, Americans will be going nowhere five years from now.

We don't have time to be crybabies about this. The talk on the presidential campaign trail about "hope" has its purpose. We cannot afford to remain befuddled and demoralized. But we must understand that hope is not something applied externally. Real hope resides within us. We generate it -- by proving that we are competent, earnest individuals who can discern between wishing and doing, who don't figure on getting something for nothing and who can be honest about the way the universe really works.

James Howard Kunstler is the author, most recently, of "World Made by Hand," a novel about America's post-oil future.

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Books by Paul Roberts:
The End of Food
The End of Oil

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The illusion of vast undeveloped U.S. oil resources
Roger Blanchard, ASPO-USA
As Americans become more desperate for oil, I expect that ANWR and offshore areas will be opened for oil development. It will be like burning the furniture to keep the house warm in mid-January. It will be a desperate move that won’t result in much.
published May 26, 2008.

original

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http://globalpublicmedia.com/museletter_19...e_united_states
Richard Heinberg's MuseLetter #194: Coal in the United States

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Robert Hirsch, Peaking of World Production: Impacts, Mitigation, and Risk Management

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The end of money?

by Kurt Cobb

original

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http://www.guardian.co.uk/commentisfree/20...d.globaleconomy
These objects of contempt are now our best chance of feeding the world

Peasants are detested by both communists and capitalists - but when it comes to productivity a small farm is unbeatable


I suggest you sit down before you read this. Robert Mugabe is right. At last week's global food summit he was the only leader to speak of "the importance of land in agricultural production and food security". Countries should follow Zimbabwe's lead, he said, in democratising ownership.

Of course the old bastard has done just the opposite. He has evicted his opponents and given land to his supporters. He has failed to support the new settlements with credit or expertise, with the result that farming in Zimbabwe has collapsed. The country was in desperate need of land reform when Mugabe became president. It remains in desperate need of land reform today.

But he is right in theory. Though the rich world's governments won't hear it, the issue of whether or not the world will be fed is partly a function of ownership. This reflects an unexpected discovery. It was first made in 1962 by the Nobel economist Amartya Sen, and has since been confirmed by dozens of studies. There is an inverse relationship between the size of farms and the amount of crops they produce per hectare. The smaller they are, the greater the yield.

In some cases, the difference is enormous. A recent study of farming in Turkey, for example, found that farms of less than one hectare are 20 times as productive as farms of more than 10 hectares. Sen's observation has been tested in India, Pakistan, Nepal, Malaysia, Thailand, Java, the Philippines, Brazil, Colombia and Paraguay. It appears to hold almost everywhere.

The finding would be surprising in any industry, as we have come to associate efficiency with scale. In farming it seems particularly odd, because small producers are less likely to own machinery, less likely to have capital or access to credit, and less likely to know about the latest techniques.

There's a good deal of controversy about why this relationship exists. Some researchers argued that it was the result of a statistical artefact: fertile soils support higher populations than barren lands, so farm size could be a result of productivity, rather than the other way around. But further studies have shown that the inverse relationship holds across an area of fertile land. Moreover, it works even in countries such as Brazil, where the biggest farmers have grabbed the best land.

The most plausible explanation is that small farmers use more labour per hectare than big farmers. Their workforce largely consists of members of their own families, which means that labour costs are lower than on large farms (they don't have to spend money recruiting or supervising workers), while the quality of the work is higher. With more labour, farmers can cultivate their land more intensively: they spend more time terracing and building irrigation systems; they sow again immediately after the harvest; and they might grow several crops in the same field.

In the early days of the green revolution, this relationship seemed to go into reverse: the bigger farms, with access to credit, were able to invest in new varieties and boost their yields. But as the new varieties have spread to smaller farmers, the inverse relationship has reasserted itself. If governments are serious about feeding the world, they should be breaking up large landholdings, redistributing them to the poor and concentrating their research and their funding on supporting small farms.

There are plenty of other reasons for defending small farmers in poor countries. The economic miracles in South Korea, Taiwan and Japan arose from their land reform programmes. Peasant farmers used the cash they made to build small businesses. The same thing seems to have happened in China, though it was delayed for 40 years by collectivisation and the Great Leap Backwards: the economic benefits of the redistribution that began in 1949 were not felt until the early 80s. Growth based on small farms tends to be more equitable than growth built around capital-intensive industries. Though their land is used intensively, the total ecological impact of smallholdings is lower. When small farms are bought up by big ones, the displaced workers move into new land to try to scratch out a living. I once followed evicted peasants from the Brazilian state of Maranhão 2,000 miles across the Amazon to the land of the Yanomami people, then watched them rip it apart.

But the prejudice against small farmers is unchallengeable. It gives rise to the oddest insult in the English language: when you call someone a peasant, you are accusing them of being self-reliant and productive. Peasants are detested by capitalists and communists alike. Both have sought to seize peasants' land, and have a powerful vested interest in demeaning and demonising them. In its profile of Turkey, the country whose small farmers are 20 times more productive than its large ones, the UN's Food and Agriculture Organisation states that, as a result of small landholdings, "farm output ... remains low". The OECD states: "Stopping land fragmentation ... and consolidating the highly fragmented land is indispensable for raising agricultural productivity." Neither body provides any supporting evidence. A rootless, half-starved labouring class suits capital very well.

Like Mugabe, the donor countries and the big international bodies loudly demand that small farmers be supported, while quietly shafting them. Last week's Rome food summit agreed "to help farmers, particularly small-scale producers, increase production and integrate with local, regional, and international markets". But when, earlier this year, the International Assessment of Agricultural Knowledge proposed a means of doing just this, the US, Australia and Canada refused to endorse it as it offended big business, while the United Kingdom remains the only country that won't reveal whether or not it supports the study.

Big business is killing small farming. By extending intellectual property rights over every aspect of production, and by developing plants that either won't breed true or don't reproduce at all, big business ensures that only those with access to capital can cultivate. As it captures both the wholesale and retail markets, it seeks to reduce its transaction costs by engaging only with major sellers. If you think that supermarkets are giving farmers in the UK a hard time, you should see what they are doing to growers in the poor world. As developing countries sweep away street markets and hawkers' stalls and replace them with superstores and glossy malls, the most productive farmers lose their customers and are forced to sell up. The rich nations support this process by demanding access for their companies. Their agricultural subsidies still help their own large farmers to compete unfairly with the small producers of the poor world.

This leads to an interesting conclusion. For many years, well-meaning liberals have supported the fair trade movement because of the benefits it delivers directly to the people it buys from. But the structure of the global food market is changing so rapidly that fair trade is now becoming one of the few means by which small farmers in poor nations might survive. A shift from small to large farms will cause a major decline in global production, just as food supplies become tight. Fair trade might now be necessary not only as a means of redistributing income, but also to feed the world.

[First Blush]

nothing from the economist?