2 Years Ago...

2 years ago this week I had this to say in my May 28, 2007 posting:

Denial II – Why we deny our Energy Condition

“Denial is the psychological process by which human beings protect themselves from things which threaten them by blocking knowledge of those things from their awareness. It is a defense which distorts reality; it keeps us from feeling the pain and uncomfortable truth about things we do not want to face. If we cannot feel or see the consequences of our actions, then everything is fine and we can continue to live without making any changes.” - CAIP website, author unknown

Before I delve further into the psyche of our national denial I want to make clear that I am not hoping for an energy crisis, population decline, financial crash, or even a date with Jessica Simpson (I'm happily married). I just call it as I see it. Further, I am more than willing to change my conclusions and assertions the VERY MOMENT THAT THE DATA CHANGES. I merely wish to explore the truth. That said, let's get to it.

Our collective denial regarding our society’s energy situation begs the questions why and how (or, more precisely, the process of how)? The “why” is, perhaps, more simply explained. The “how” is somewhat more complicated.

I am often asked: Does the “government”, or “the President”, or do “They” know about “Peak Oil”? And, “if this is true, why haven’t I/we been thoroughly informed”? Though the United States federal government has funded and received detailed reports on the issue from the U.S. Department of Energy and the Pentagon, the American body politic, and the American people, have and must continue to deny the reality of a permanent and accelerating decline in energy supplies – if we do not continue this denial WE WOULD HAVE TO ACTUALLY DO SOMETHING ABOUT IT. And those “somethings” are going to have real and immediate intended AND unintended consequences, much to the chagrin of our political leaders.

Why isn’t this front-page news? Why, indeed. It is not a conspiracy. The mainstream media is in the business of selling advertising, not public service. While they delight in the opportunity to bleed one unfortunate sot or another on the rack, they have little incentive to gore their holy cow(s) – the energy intensive industries that make up the backbone of their advertising revenues - residential real estate and automobiles.

Don’t count on Big Oil to be forthcoming on the issue. The executives at Big Oil are pulling down as much as 9-figure (that’s over $100,000,000) yearly compensation, and not for their brilliant execution (although that’s what the press releases claim). The record profits these corporations are enjoying at the moment have nothing to do with executing and everything to do with commodity prices (which these executives have no control over and have provided no value added, although they have been paid as such), but if you were in line for a $400 million compensation package, would you let ”Peak Oil” and high commodity prices take credit?

Corporate America outside of the energy sector is in no mood to be a hero (martyr). Once this issue breaks into the national dialogue corporate America’s stock options and 401k’s are going down like a rock in a pond.

If the media, corporate America, and our elected officials are disinclined to bring this issue to the fore… why would John Q. Public? It is far easier for John Q. Public to use his highly developed sense of denial (the same technique he uses for his obesity, smoking, drinking, lack of savings… we might not be able to save for the future but we sure can work the denial button).

Consider what might result should a sitting President (I should say "when", because this speech is coming, relatively soon) of the United States hold a news conference and state:

"My fellow Americans. It is my unfortunate duty to inform you that our petroleum supplies have entered a period of sustained and accelerating decreases in supplies. Within 15 years America will have 50% less oil available to its citizens than today, and within 30 years approximately 90% less….” (This speech does not have to take place all at once… it might be delivered over the course of several years by many political leaders. It might have already begun with the “America is addicted to oil” line in the last State of the Union address.) The speech will be entirely reactive. Most informed people will already know that we have entered terminal decline of energy supplies, and the uniformed will just be angry.

Of course the speech would be much longer and filled with pointless platitudes about the American people’s ability to handle adversity, blah, blah, blah… but then things get interesting. Upon waking from their denial, and once the idea is in the public domain and now without fear of ridicule, the American inteligencia would begin to explore the ramifications, combinations, and permutations of all of the possible outcomes, as well as the timing, of the overwhelming impacts that energy descent will have on our political, social, and economic structures, and they are going to do it OUT LOUD. Denial is going to evaporate instantly, only to be replaced by something worse – panic. Right now there is the heavy brake of denial slowing its momentum, but once we reach critical mass, nothing, and none of us, will be able to stand in its way.

The inteligencia will be the spark - but it is “middle management” on down to migrant farm worker that will become the fire. The lumpen masses will figure out that their ship ain’t coming in, and some might even be bright enough to figure out that they were the victims of societal propaganda, and that their ship was NEVER going to come in – and then they might get mad (more on that in the next article in this series titled ANGER). But first they will hoard.

They will hoard gasoline, propane, kerosene, etc… they will hoard food, water, and medicine, etc… they will hoard gold, silver, diamonds, etc… they will hoard weapons, etc… THEY WILL HOARDE EVERYTHING (everything except US dollars). This is the point when systems will likely begin to break down. But I digress; we are talking denial here…

I received more emails about the implications of declining energy availability and population on the housing market than anything else! What happens to housing when people can’t get to their second home in the mountains or at the beach, and there are less people in the society in the first place? Talk about denial: This is barely worth discussing – we have much bigger problems, folks.

Can the U.S. fiat currency system survive the knowledge that most fossil fuel energy supplies will dwindle to nothing before my infant son reaches middle age? NAFC (Not A Freaking Chance). Will people continue to pay back their 30-year mortgage? They won’t be able to (and will have no incentive to do so). So what happens to the financial markets and the banking system if people do not pay back their loans and the currency collapses? Nothing good. Unemployment in this environment would make the 1930’s look like a prom date.

Just “how” did we get to this level of denial? Not enough space here to do that justice. It was not some great conspiracy; more of a phenomena. Our method of government is purposely decentralized and its missions fragmented, our corporate institutions were not charged with saving us from ourselves, the media is there to entertain (after all, how can the media explain such a complicated issue in 12 minute segments punctuated by 3 minutes of 30 second distractions extolling the virtues of eating, driving, and then dieting, with the occasional “hope in a bottle” pitch?), and our educational institutions were too busy deceiving the American proletariat into believing that if you spent 10% of your working life and several hundred thousand dollars at their schools getting a certificate that says you were competent in sports massage therapy, art appreciation, or sensitivity training, or some other impossible to measure, nearly worthless “skill” (easy, if you think the skills have value, why are their compensation rates so low?), that you could compete with Ivy League graduates from establishment families, get a job at a Goldman Sachs, Lehman Brothers, or Bear Stearns (where the AVERAGE employee compensation, including secretaries, is over $500,000 per year) and live in a mansion in Greenwich, irrespective of your families social position.

I am not suggesting American life is, or should be, fair. Only that we have deceived ourselves into believing that it is. Life has always been a competition with its resultant “winners” and “losers”. If you are a self-made “winner” that came up out of the muck and mire, you understand this without further explanation. If you were born into a “winner” family, advantages such as private schools, summers on the Vineyard, a semester abroad, before beginning your career on Wall Street, the Law, or Medicine were the norm. Our very own George W. Bush, an admitted “C” student, was accepted to the prestigious Harvard Business School. Considering how limited seating was at HBS my bet is that some less-well-connected straight “A” student was the “loser” in that competition (it gets even better… “W” once said in commenting on performance enhancing drug use by athletes that “there are no short cuts to success” – "W" was a Yale legacy student (his family were Yale Aumni)! Hypocracy knows no bounds.) If you were born into a “loser” family, your experience was somewhat different than W’s. Still, “losers”, at least in America, did not starve. The rest of the world’s “losers” have not been so fortunate.

The definition of “winner” is going to be markedly different in our new environment: your progeny will survive. “Losers”, in the 21st century, will get a far less satisfactory consolation prize than the “losers” of the 20th century. That’s what population decline means. It’s just that when the U.N. says it, it sounds nicer.

We were all too busy with our nose to the grindstone to notice that the scale of growth in our population, energy, food consumption, and environmental impacts (over-fishing, anyone?) had grown beyond our ability to sustain them. Well, not everybody. SOMEONE OR SOMETHING spent an awful lot of money to dissuade Americans from accepting mankind’s contribution to climate change and that they could pump CO2 into the atmosphere with reckless abandon and without consequence. It wasn’t until the Chinese threatened to usurp our position as the CO2 emission leader that we began to realize that, while it is OK if WE do it, everybody can’t live like this (and by the way, why are you guys trying to steal “our” oil?).

I continue to maintain that there is no macro solution to this condition - and it is a condition, not a problem; problems have solutions - any more than there was a solution to the Tsunami of 2004, or the 1918 flu pandemic. You either survived these challanges or you did not, you were either a "winner" (survivor) or a "loser" (casualty). There will be "winners" and "losers" in the new paradigm brought to you courtesy of energy descent, and all of our denial in the aggregate will not change that outcome.

My infant son, born earlier this year, will likely never need a driver’s license. His children will not experience air travel. My older son’s first car will survive its fuel supply. Our denial is most prominently displayed in the way we prepare our children for their future – a future that will not exist.

End of post from May 29, 2007


Not bad, if I do say so myself.

Mentatt