TTIP leaks reveal US position

SUBHEAD: Leaked text shows attempts by US to undermine EU environment and health protection laws.

By Staff on 1 May 2016 for GreenPeace -
(http://www.greenpeace.org/eu-unit/en/News/2016/TTIPleaks-confidential-TTIP-papers-unveil-US-position/)


Image above: American negotiators hidden agenda. From original article.

Greenpeace Netherlands has obtained 248 pages of leaked Transatlantic Trade and Investment Partnership (TTIP) negotiating texts [1], which will be published on Monday 2 May at 11:00 CET. The documents unveil for the first time the US position and deliberate attempts to change the EU democratic legislative process.

The classified documents represent more than two-thirds of the overall TTIP text as of April, at the 13th round of TTIP negotiations in New York. They cover 13 chapters addressing issues ranging from telecommunications to regulatory cooperation, from pesticides, food and agriculture to trade barriers.

Jorgo Riss, director of Greenpeace EU, said: “These leaked documents confirm what we have been saying for a long time: TTIP would put corporations at the centre of policy-making, to the detriment of environment and public health. We have known that the EU position was bad, now we see the US position is even worse. A compromise between the two would be unacceptable.”
Greenpeace identified four main issues of concern:
  • Long standing environmental protection is dropped
The “General Exceptions” rule, enshrined in the GATT agreement of the World Trade Organisation (WTO), is absent from the text. This nearly 70-year-old rule allows nations to restrict trade “to protect human, animal and plant life or health", or for "the conservation of exhaustible natural resources" [2].          
  • No place for climate protection in TTIP
If the goals of the Paris Summit to keep temperatures increase under 1.5 degrees are to be met, trade should not be excluded from CO2 emissions reduction specifications. But nothing about climate protection can be found in the obtained texts.
  • Precautionary principle is forgotten
The US wants the EU to replace the EU’s hazard approach with ‘risk management’, disregarding the precautionary principle, [3] which is enshrined in the EU Treaty but is never mentioned in the consolidated text.
  • Open door for corporate lobbying
The leaked documents suggest that both parties consider giving corporations much wider access and participation in decision making.

Jorgo Riss said: “The effects of TTIP would be initially subtle but ultimately devastating. It would lead to European laws being judged on their consequences for trade and investment – disregarding environmental protection and public health concerns.”

A 70-year-old EU rule, which allows nations to restrict trade in order “to protect human, animal and plant life or health," or for "the conservation of exhaustible natural resources,” would end, if U.S. President Barack Obama gets what he wants.

Furthermore, the “Precautionary principle is forgotten”: it’s currently enshrined in the EU Treaty, but Obama wants it gone; it is stated in the EU Treaty as allowing "rapid response in the face of a possible danger to human, animal or plant health, or to protect the environment. In particular, where scientific data do not permit a complete evaluation of the risk, recourse to this principle may, for example, be used to stop distribution or order withdrawal from the market of products likely to be hazardous.”&

Obama wants there to be no ability for EU nations to withdraw from the market “products likely to be hazardous.” All products would be assumed safe, unless proven not to be.



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Send out the Clowns

SUBHEAD: The loathsome Koch brothers have already made their move onto Hillary’s side of the game-board.

By James Kunstler on 2 May 2016 for Kunstler.com -
(http://kunstler.com/clusterfuck-nation/send-out-the-clowns/)


Image above: Painting "THe Monkey Whisperer", oil on canvas, 24"x30" by Mark Bryan. From (http://www.artofmarkbryan.com/circus/#!jig[1]/NG/264).

In this decade of maximum peril, a prankish God delivers two maximally detested candidates to lead the faltering nation as events run ahead of all the convenient narratives. For instance: the idea that Republican “insiders” can block Trump’s path to the nomination. 

The insiders may be phantoms after all. For instance, the loathsome Koch brothers have already made their move onto Hillary’s side of the game-board. Trump won’t miss their campaign contributions for a New York minute (while Hillary might find a way to stuff the cash into some Cayman Islands lock-box of the Clinton Foundation).
 
Events played right into Trump’s smallish hands last week when protesters outside a Donald rally in Costa Mesa, CA, waved Mexican flags and placards calling for the reestablishment of Aztl√°n del Norte. Kind of proves his point about illegal immigration, don’t it? 

Trump also supposedly blundered in saying that Hillary had only “the women’s card” left to play in her donkey trot to the election. I’m not so sure he’s wrong about that — though the indignometer needle danced through the red-line after he said it.

Has it come to this? The women’s party against the men’s party? What kind of idiot psychodrama is this country acting out? Mom and dad mud-wrestling in an election year hog-wallow? A Reality TV show writ large from sea to shining sea? Are there no better ways of understanding the difficulties we face?
 
Lately Hillary has been boasting of her ability to bring Wall Street to heel, theoretically after Wall Street installs her in the White House. Voters (especially women) might want to pay attention to Hillary’s lavish praise for President Obama’s handling of the banking turpitudes still unresolved seven years after the crack-up of 2008. 

What did the Dodd-Frank Act (signed by “O” in 2010) accomplish except to provide more lucrative work-arounds, by Too-Complex-To-Comprehend legalese, for Too-Big-To-Fail banks. It was written by bank lobbyists and lawyers and was about 2,270 pages longer than the old Glass Steagall Act that Bill Clinton vaporized in 1999. 

Do you suppose that Bill and Hill might have talked about the repeal of Glass Steagall back then? Do you wonder what she thought about it at the time… being a lawyer and all?

This week attention is fixed on the Indiana primary where Devil Bat Ted Cruz desperately makes his last stand against the Trump juggernaut. It seems that former House Speaker John Boehner actually succeeded in driving a wooden stake through Cruz’s hypothetical heart by casually remarking that he was “the most miserable sonofabitch I ever worked with.” 

Kind of hard to explain that one away, though Ted tried by sending out his new attack dog Carly Fiorina and claiming that he never worked with the Speaker of the House — a risible claim for a national legislator in the same party.

All of this would be amusing if the USA wasn’t sliding into the twilight of what many people call “modernity” — which is code for the techno-industrial hyper-complexity we’ve been enjoying lately as a species. We have yet to comprehend the diminishing returns of heaping more complexity on what is already too complex. Exhibit A for most of the common folk must be the Affordable Care Act (also signed by “O” in 2010). 

Whereas the shrewd stylings of Dodd-Frank surely mystify the public, most full-functioning adults understand what it means when their health insurance premiums go up by 20 percent and the new deductible makes it unthinkable to even consider going to the emergency room.

The sad truth may be that rackets of this kind are unreformable, and that we can’t begin to do things differently until they collapse. It should be obvious, for instance, that American health care needs to move in the opposite direction from where it has been going — from giantism, as epitomized by colossal merged mega-hospital corporations, back to some kind of local clinic care in which doctors and their subalterns are not burdened by an oppressive matrix of Charge-Master grift. 

There may be less razzle-dazzle technology in that future model, but much more hands-on care, plus an end to the kind of financial pillage that bankrupts households for relatively routine illnesses (the $90,000 appendectomy).

Likewise in virtually all other areas of American life, the real trend as yet un-discussed in this election campaign, will be unwinding and downscaling of the onerous, toxic hyper-complexity of the age now passing and finding our way to a workable re-set of what used to be known as political-economy.

In the meantime: a clown show.

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Introduction to Hawaiian Land Areas

SUBHEAD: This is a synthesis of the Hawaiian historical record combined with contemporary ecological frameworks.

By Juan Wilson & Jonathan Jay on 2 May 2106 for Island Breath-
(http://islandbreath.blogspot.com/2016/05/introduction-to-hawaiian-land-areas.html)

http://www.islandbreath.org/hawaiinei/M4Lanai/M4LanaiRasterFile.png
Image above: Map of Lanai, Hawaii, showing Life Zones, Ahupuaa, Mokum Waihona. Click to enlarge.

By Juan Wilson
The traditional land divisions of pre-contact Hawaiians was based on the sustainability and self-reliance within community watershed areas (ahupuaa) as well as within bioregions (moku) and lastly individual sovereign islands (mokupuni). These natural land divisions were the result of the flow of water over the land. We are now beginning to include evidence of the flow of water over and under the surface of the islands. We are calling these areas of consideration Waihona.

For simplicity and efficiency this current work is not being coordinated through the Ahu Moku Committee. Historic documents, reference material and selected kapuna are being consulted. On May 1st 2016 we released the current state of the work to the public. We welcome comment and criticism. This work is far from complete. Waihona are only partially covered at this time.

The new work can be found by clicking here:
(http://www.islandbreath.org/hawaiinei/hawaiinei.html

The available downloadable files of Big Island, Maui, Kahoolawe, Lanai Molokai, Oahu, Kauai and Niihau are in the following formats:

GoogleEarth Files - .kmv
Arch D size Plot Files - .pdf
High Resolution Raster Files - .png
ArcView GIS Shape Files - .shp
AutoCad Document Exchage Files - .dxf

The older Ahu Moku work can be found here:
(http://www.islandbreath.org/mokupuni/mokupuni.html)


By Jonathan Jay
Although this work began as an inquiry into the existing historical cartographic documents and collected oral descriptions of the traditional and customary Ahupua`a and Moku land management system of the Polynesian and Hawaiian people, this work is now a synthesis of that historical record combined with contemporary Western ecological and environmental frameworks, adapted to existing present conditions.

As such, this work is no longer an attempt to accurately recreate the boundaries of ahupua'a or moku divisions at a particular point in history. Instead, by attempting to discern the principles and frameworks of understanding that allowed for the creation of organic divisions of land in the first place, we now strive to apply these principles to our contemporary conditions - 'Ahupua`a & Moku for the 3rd Millennium' if you will.  It is our hope that this work will provide the basis for prudent, long-range, sustainable land-use and resource management.


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Women Who Farm

SUBHEAD: The actions of women rooted in agriculture, leadership and cultural change.

By Katie Massy on 1 March 2016 for Overgow the System -
(http://www.overgrowthesystem.com/women-who-farm/#wome-who-farm)


Image above: A woman farming. From  original article.

From backyards, abandoned urban spaces, rural properties, and farmland, women around the world, are leading a change that nourishes the soil, encourages biodiversity, safe-guards the seeds, and teaches the children.

This movement continues to gain power through the women who are changing the future of food. Their hardwork, re-skilling and activism is what the world has been waiting for.
Women Who Farm seeks to share these stories.

This project establishes itself as an online media project, and as a book that follows the stories of 15 women across Canada and the United States. The book is still in its infancy stage, while the online project is now underway.

Women Who Farm seeks to celebrate women, through it’s multiple platforms in order to create a new narrative of perserverance, skill and leadership. These stories can inspire both women and men, towards a more ecological and diverse food system which in turn will bring about a more socially just and biodiverse world.

As Vandana Shiva, an agricultural activist says, “We are either going to have a future where women lead the way to make peace with the earth, or we are not going to have a human future at all.”

Are you a woman dedicated to small-scale agriculture, homesteading, gardening, market farming, or raising animals in an ethical way?  Be apart of Women Who Farm! We seek to celebrate women who are leading the local food movement.

To be featured on the Women Who Farm Facebook page send in a photo of yourself on your farm, or in your garden, etc. and we will send you a question. Once we receive your reply, we will feature you on our social media channels. We will post your photo with your engaging quote and give credit to you and your farm.

Do you want to write for Women Who Farm?  We are seeking to publish articles through our online platform connected with Over Grow The System. We will also share your article on the Women Who Farm social media sites.

One last easy way to be apart of Women Who Farm: Tag yourself #womenwhofarm and connect up with us!

Please send all photo’s, submissions and any questions you may have to submissions@womenwhofarm.com

[Her]Story is an online feature of Women Who Farm that empowers and celebrates women around the world. We share the stories of women to inspire a new narrative of empowerment through gardening, homesteading, farming, beekeeping, and seed saving.

This online platform is for you. By sharing your story, you inspire others to create positive change on both the land and in communities throughout the world. By sharing the good work that you and countless women are indebted to, you inspire ripples of positive global change.

Tips & suggestions for your entry:
  • Please give full, in depth replies. Write like you would in an essay.
  • Find someone who can go over and edit your entry before you enter in below.
  • Feel free to advertise the work you are doing, such as your blog or book etc., but don’t let it over shadow the writing. You can advertise at the end of the article the work in which you want to promote.
  • We want to share your story with both the challenges and victories. We are inspired by the real stories of what it means to farm and grow food. It’s not all sunshine and kale, and we are totally inspired by that. Check out some of our Her[Story] features below.
  • After we receive your submission, we will contact you and ask for photographs.  
  • Please send in ten to fifteen high quality images. Images really help with the telling of your story.
  • You don’t have any high quality images? Reach out to your community to see if there is anyone who will take pictures of you and your work.  Some smart phones take good enough quality images that look beautiful. We request that all images are 2000pix wide
  • Please reply to the questions you feel most called to. You do not need to reply to all of them.

My name is Katie Massy. I have been farming since the age of 25. I found my life’s career when I planted the first seeds of early Spring. My first year farming was filled with struggle, but that year of not having a boss, being free on the land, eating amazing food, made me fall in love with being a farmer.

Heart and Soil Organics, run by my partner and I, began when I met a man travelling down from the Haida Gwaii, who urged me to start growing food. With limited access to locally grown food, and most food being shipped in, he was concerned about the Haida Gwaii and noted that Vancouver Island was in a similar situation. It was that day that my partner and I decided to start farming.
We now grow on an acre of land, maybe a little bit more.

Our intention is not to plow more soil, but to grow with better soil, quality seed, and rain harvested water. We spend a lot of time soil building. Each year we harvest enough rain water to irrigate our entire farm for the year.

With the support of our customers it is possible for us to grow food that nourishes both the land and its people. When people take home food we have grown, I feel such happiness in my heart. They have tasted what a real tomato tastes like.

I believe farming is such a perfect vocation for women. It takes real nuturing and attention to grow good food. We don’t need to know how to fix huge tractors, or combines. All we need are some hand tools, determination and a strong back.

I hope that you share your story with me. Together we can change the cultural ideal of what it means to be a woman and celebrate being a farmer. It is a great thing to be a woman who farms.


Video above: "Women Who Farm". Featuring Katie Massy. From original article. (https://vimeo.com/155460216).

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Gross Domestic Product

SUBHEAD: The art of Phillip Hua displays the contrast between grace and rigidity, between animate life and financial growth.

By Barry Lopez on 1 May 2016 for Orion Magazine -
(https://orionmagazine.org/article/gross-domestic-product/)


Image above: "What You Own" by Phillip Hua. From original article.

Like a leopard hiding in the limbs of an acacia, Phillip Hua’s artwork caught me by surprise. The contrast between grace and rigidity, between animate life and random, inert news of financial growth, posed for me unbidden questions about wealth, though a mind other than mine could have gone off in some other direction. Hua has layered in a lot of meaning here, in a style reminiscent of classical Chinese painting, which also combines text with image.

I thought first, on seeing these collages, of Sven Beckert, a scholar of the Industrial Revolution, whose Empire of Cotton provides the reader with 250 years of perspective on the situation the West faces today. He begins his analysis by meticulously tracing the origins of industrial capitalism.

The years 1492–1780, writes Beckert, were an era during which the proprietary rights of entrepreneurs, the development of innovative instruments to move capital, state-financed expansion of infrastructure, and the militarized exploration of Europe’s hinterlands prepared the ground from which the Industrial Revolution would spring.


Image above: "Owning the Risk" by Phillip Hua. From original article.

He calls this time “the era of war capitalism” because its most distinctive characteristic was violence—crushing native resistance, expropriating lands, and establishing slavery on a gargantuan scale.

The underlayer of Hua’s collages, a palimpsest beneath the airy layer through which his birds fly, his fish swim, and his trees climb, is the perpetuated record of the violent exploitation Beckert describes. The newspaper graphics seem sinister, in the way a snake ascending a tree toward a clutch of eggs in a nest might seem sinister.

For the moment, Hua’s creatures are able to flit and soar and flourish apart from the implacable lines of regimented information, with all the indifference and volatility they imply.

It’s the very precariousness of the situation, though, that raises for me the question of what we value. Is the promise of material wealth, the rhetoric of buy and sell on these pages, the sort of wealth we hope to secure? Or is the wealth we most desire symbolized by the birds?


Image above: "Eloquent Indicators" by Phillip Hua. From original article.

Generally speaking, we have enough folklore streaming through our minds about birds—the canary in the mine, the prize goes to the early bird, not a sparrow falls, a life free as a bird’s—to understand at several levels the contrast Hua is creating. His art is not narrowly didactic. It is, instead, ethical and stark, and, importantly, has an international reach.

A shopkeeper in Dhaka or one in Brooklyn knows exactly what’s going on here. Hua’s work follows a line of moral objection that can be traced back at least five hundred years to Bartolom√© de las Casas, writing to his Dominican superiors in Spain from the “new world,” in the mid 1500s, denouncing the inhumanity of the encomienda system.

If art is to fulfill its primary purpose, to recollect for us a world other than the one of our daily lives, it must do what Hua has done here—remind us of what we aspire to. His creatures move freely, not yet trapped in the acquisitive, reductive prose beneath them, in which numbers, not lives, often stand for reality.

It would be wrong, I believe, to categorize Hua’s work as political. He is a historian, really, telling us the story we repeatedly forget, the story of unflinching objection to the legacy of war capitalism. His primary aim, I have to think, is not to entertain but to encourage.


Image above: "Atlas" by Phillip Hua. From original article.

He’s asking whether we wish to continue entrusting our future to strategies for individual profit, to the clamor of bells on the trading floors of stock exchanges, or to the informing sound of birdsong, a sound far more profound than the narrow slot we have provided for birdsong in our cherished texts of natural history.

• Phillip Hua’s art has been widely exhibited, and he has been shortlisted for the Young Masters Art Prize. He teaches at the Academy of Art University in San Francisco. Barry Lopez, an Orion contributing editor, is the author of fourteen books, including Arctic Dreams, for which he received the 1986 National Book Award.

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The markets are being faked

SUBHEAD:  All of this is being played to keep people believing the system is still working.

By Mac Slavo on 29 April 2016 for SHTF Plan -
(http://www.shtfplan.com/headline-news/market-analyst-nothing-is-real-all-of-this-is-being-played-to-keep-people-believing-the-system-is-working_04292016)


Image above: Two cowgirls riding the fake bull. From (https://gacar.afrogs.org/#/index).

The stock market may be hovering near all-time highs, but according to Greg Mannarino of Traders Choice that doesn’t mean the valuations are actually real:
"We exist, beyond any shadow of any doubt, in an environment of absolute fakery where nothing is real… from the prices of assets to what’s occurring here with regard to the big Wall Street banks, the Federal Reserve, interest rates and everything in between.
…All of this is being played in a way to keep people believing, once again, that the system is working and will continue to work."
President Obama has suggested that people like Greg Mannarino who are exposing the fraud for what it is are just peddling fiction. And just this week the President argued that he saved the world from a great depression and that the closing credits of the 2008 crash movie “The Big Short” were inaccurate when they claimed that nothing has been done to fundamentally curb the fraud and fix the system under his administration.

But as Mannarino notes, the President and his central bank cohorts are making these statements because the system is so fragile that if the public senses even the smallest problem it could derail the entire thing:
Let’s just look at the stock market… there’s no possible way at this time that these multiples can be justified with regard to what’s occurring here with the price action of the overall market… meanwhile, the market continues to rise...

Nothing is real. I can’t stress this enough… and we’re going to continue to see more fakery… and manipulation and twisting of this entire system…  We now exist in an environment where the financial system as a whole has been flipped upside down just to make it function… and that’s very scary...

We’ve never seen anything like this in the history of the world… The Federal Reserve has never been in a situation like this… we are completely in uncharted territory where the world’s central banks have gone negative interest rates… it’s all an illusion to keep the stock market booming.

Every single asset now… I don’t care what asset… you want to look at currency, debt, housing, metals, the stock market… pick an asset… there’s no price discovery mechanism behind it whatsoever… it’s all fake… it’s all being distorted...

The system is built upon on one premise and that is confidence that it will work… if that confidence is rattled the whole thing will implode… our policy makers are well aware of this… there is collusion between central banks and their respective governments… and it will not stop until it implodes… and what I mean by implode is, correct to fair value.
And when that confidence is finally lost and the fraud exposed – and it will be as has always been the case throughout history – the destruction to follow will be one for the history books.
In a previous interview Mannarino warned that things could get so serious after the bursting of such a massive bubble that millions of people will die on a world-wide scale:
It’s created a population boom… a population boom has risen in tandem with the debt. It’s incredible.
So, when the debt bubble bursts we’re going to get a correction in population. It’s a mathematical certainty.
Millions upon millions of people are going to die on a world-wide scale when the debt bubble bursts. And I’m saying when not if…

When resources become more and more scarce we’re going to see countries at war with each other. People will be scrambling… in a worst case scenario… doing everything that they can to survive… to provide for their family and for themselves.

There’s no way out of it.
And that may be why governments around the world are preparing for nothing short of Armageddon that will see rioting in the streets, violence, civil war and regime change. In the United States, the Federal government and Pentagon have been war-gaming large scale economic collapse scenarios and those preparations began in earnest shortly after the collapse of 2008.

Nationally syndicated talk radio host Mark Levin explains:
I’m going to tell you what I think is going on.
I don’t think domestic insurrection. Law enforcement and national security agencies, they play out multiple scenarios. They simulate multiple scenarios.
I’ll tell you what I think they’re simulating.
The collapse of our financial system, the collapse of our society and the potential for widespread violence, looting, killing in the streets, because that’s what happens when an economy collapses.
I’m not talking about a recession. I’m talking about a collapse, when people are desperate, when they can’t get food or clothing, when they have no way of going from place to place, when they can’t protect themselves.
There aren’t enough police officers on the face of the earth to adequately handle a situation like that.
I suspect, that just in case our fiscal situation collapses, our monetary situation collapses, and following it the civil society collapses – that is the rule of law – that they want to be prepared.
There is no other explanation for this.
The entire system is built upon a fraud. The losses have been hidden and papered over with trillion dollar cash infusions by governments and central banks around the world.

It is only a matter of time. That we can be sure of.

If you’re reading this and haven’t yet done so, it’s time to prepare for a collapse of a magnitude never before witnessed.

The elite are feverishly building bunkers for a reason, just as the government is spending billions of dollars on food stockpiles, assault weapons, and hundreds of millions of rounds of ammunition.

Why? Because they know.
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Debacle at Doha

SUBHEAD: The Saudi led debacle in Doha will be seen as marking the beginning of the end of the old oil order.

By Michael Klare on 28 April 2016 for Tom Dispatch -
(http://www.tomdispatch.com/post/176134/tomgram%3A_michael_klare%2C_the_coming_world_of_%22peak_oil_demand%2C%22_not_%22peak_oil%22/)


Image above: Skyscrapers in the city of Doha, Qatar. From (http://www.resilience.org/stories/2016-04-29/the-debacle-at-doha).

Sunday, April 17th was the designated moment. The world’s leading oil producers were expected to bring fresh discipline to the chaotic petroleum market and spark a return to high prices.

Meeting in Doha, the glittering capital of petroleum-rich Qatar, the oil ministers of the Organization of the Petroleum Exporting Countries (OPEC), along with such key non-OPEC producers as Russia and Mexico, were scheduled to ratify a draft agreement obliging them to freeze their oil output at current levels.

In anticipation of such a deal, oil prices had begun to creep inexorably upward, from $30 per barrel in mid-January to $43 on the eve of the gathering. But far from restoring the old oil order, the meeting ended in discord, driving prices down again and revealing deep cracks in the ranks of global energy producers.

It is hard to overstate the significance of the Doha debacle. At the very least, it will perpetuate the low oil prices that have plagued the industry for the past two years, forcing smaller firms into bankruptcy and erasing hundreds of billions of dollars of investments in new production capacity. It may also have obliterated any future prospects for cooperation between OPEC and non-OPEC producers in regulating the market.

Most of all, however, it demonstrated that the petroleum-fueled world we’ve known these last decades -- with oil demand always thrusting ahead of supply, ensuring steady profits for all major producers -- is no more. Replacing it is an anemic, possibly even declining, demand for oil that is likely to force suppliers to fight one another for ever-diminishing market shares.

The Road to Doha
Before the Doha gathering, the leaders of the major producing countries expressed confidence that a production freeze would finally halt the devastating slump in oil prices that began in mid-2014. Most of them are heavily dependent on petroleum exports to finance their governments and keep restiveness among their populaces at bay.

Both Russia and Venezuela, for instance, rely on energy exports for approximately 50% of government income, while for Nigeria it’s more like 75%.  So the plunge in prices had already cut deep into government spending around the world, causing civil unrest and even in some cases political turmoil.

No one expected the April 17th meeting to result in an immediate, dramatic price upturn, but everyone hoped that it would lay the foundation for a steady rise in the coming months. The leaders of these countries were well aware of one thing: to achieve such progress, unity was crucial.

Otherwise they were not likely to overcome the various factors that had caused the price collapse in the first place.  Some of these were structural and embedded deep in the way the industry had been organized; some were the product of their own feckless responses to the crisis.

On the structural side, global demand for energy had, in recent years, ceased to rise quickly enough to soak up all the crude oil pouring onto the market, thanks in part to new supplies from Iraq and especially from the expanding shale fields of the United States.

This oversupply triggered the initial 2014 price drop when Brent crude -- the international benchmark blend -- went from a high of $115 on June 19th to $77 on November 26th, the day before a fateful OPEC meeting in Vienna. The next day, OPEC members, led by Saudi Arabia, failed to agree on either production cuts or a freeze, and the price of oil went into freefall.

The failure of that November meeting has been widely attributed to the Saudis’ desire to kill off new output elsewhere -- especially shale production in the United States -- and to restore their historic dominance of the global oil market. Many analysts were also convinced that Riyadh was seeking to punish regional rivals Iran and Russia for their support of the Assad regime in Syria (which the Saudis seek to topple).

The rejection, in other words, was meant to fulfill two tasks at the same time: blunt or wipe out the challenge posed by North American shale producers and undermine two economically shaky energy powers that opposed Saudi goals in the Middle East by depriving them of much needed oil revenues.

Because Saudi Arabia could produce oil so much more cheaply than other countries -- for as little as $3 per barrel -- and because it could draw upon hundreds of billions of dollars in sovereign wealth funds to meet any budget shortfalls of its own, its leaders believed it more capable of weathering any price downturn than its rivals.

Today, however, that rosy prediction is looking grimmer as the Saudi royals begin to feel the pinch of low oil prices, and find themselves cutting back on the benefits they had been passing on to an ever-growing, potentially restive population while still financing a costly, inconclusive, and increasingly disastrous war in Yemen.

Many energy analysts became convinced that Doha would prove the decisive moment when Riyadh would finally be amenable to a production freeze.  Just days before the conference, participants expressed growing confidence that such a plan would indeed be adopted.

After all, preliminary negotiations between Russia, Venezuela, Qatar, and Saudi Arabia had produced a draft document that most participants assumed was essentially ready for signature. The only sticking point: the nature of Iran’s participation.

The Iranians were, in fact, agreeable to such a freeze, but only after they were allowed to raise their relatively modest daily output to levels achieved in 2012 before the West imposed sanctions in an effort to force Tehran to agree to dismantle its nuclear enrichment program.  Now that those sanctions were, in fact, being lifted as a result of the recently concluded nuclear deal, Tehran was determined to restore the status quo ante.

On this, the Saudis balked, having no wish to see their arch-rival obtain added oil revenues.  Still, most observers assumed that, in the end, Riyadh would agree to a formula allowing Iran some increase before a freeze.

“There are positive indications an agreement will be reached during this meeting... an initial agreement on freezing production,” said Nawal Al-Fuzaia, Kuwait’s OPEC representative, echoing the views of other Doha participants.

But then something happened. According to people familiar with the sequence of events, Saudi Arabia’s Deputy Crown Prince and key oil strategist, Mohammed bin Salman, called the Saudi delegation in Doha at 3:00 a.m. on April 17th and instructed them to spurn a deal that provided leeway of any sort for Iran.

When the Iranians -- who chose not to attend the meeting -- signaled that they had no intention of freezing their output to satisfy their rivals, the Saudis rejected the draft agreement it had helped negotiate and the assembly ended in disarray.

Geopolitics to the Fore
Most analysts have since suggested that the Saudi royals simply considered punishing Iran more important than raising oil prices.  No matter the cost to them, in other words, they could not bring themselves to help Iran pursue its geopolitical objectives, including giving yet more support to Shiite forces in Iraq, Syria, Yemen, and Lebanon.

Already feeling pressured by Tehran and ever less confident of Washington’s support, they were ready to use any means available to weaken the Iranians, whatever the danger to themselves.

“The failure to reach an agreement in Doha is a reminder that Saudi Arabia is in no mood to do Iran any favors right now and that their ongoing geopolitical conflict cannot be discounted as an element of the current Saudi oil policy,” said Jason Bordoff of the Center on Global Energy Policy at Columbia University.

Many analysts also pointed to the rising influence of Deputy Crown Prince Mohammed bin Salman, entrusted with near-total control of the economy and the military by his aging father, King Salman. As Minister of Defense, the prince has spearheaded the Saudi drive to counter the Iranians in a regional struggle for dominance.

Most significantly, he is the main force behind Saudi Arabia’s ongoing intervention in Yemen, aimed at defeating the Houthi rebels, a largely Shia group with loose ties to Iran, and restoring deposed former president Abd Rabbuh Mansur Hadi.

After a year of relentless U.S.-backed airstrikes (including the use of cluster bombs), the Saudi intervention has, in fact, failed to achieve its intended objectives, though it has produced thousands of civilian casualties, provoking fierce condemnation from U.N. officials, and created space for the rise of al-Qaeda in the Arabian Peninsula. Nevertheless, the prince seems determined to keep the conflict going and to counter Iranian influence across the region.

For Prince Mohammed, the oil market has evidently become just another arena for this ongoing struggle. “Under his guidance,” the Financial Times noted in April, “Saudi Arabia’s oil policy appears to be less driven by the price of crude than global politics, particularly Riyadh’s bitter rivalry with post-sanctions Tehran.”

This seems to have been the backstory for Riyadh’s last-minute decision to scuttle the talks in Doha. On April 16th, for instance, Prince Mohammed couldn’t have been blunter to Bloomberg, even if he didn’t mention the Iranians by name: “If all major producers don’t freeze production, we will not freeze production.”

With the proposed agreement in tatters, Saudi Arabia is now expected to boost its own output, ensuring that prices will remain bargain-basement low and so deprive Iran of any windfall from its expected increase in exports.

The kingdom, Prince Mohammed told Bloomberg, was prepared to immediately raise production from its current 10.2 million barrels per day to 11.5 million barrels and could add another million barrels “if we wanted to” in the next six to nine months.

With Iranian and Iraqi oil heading for market in larger quantities, that’s the definition of oversupply.  It would certainly ensure Saudi Arabia’s continued dominance of the market, but it might also wound the kingdom in a major way, if not fatally.

A New Global Reality
No doubt geopolitics played a significant role in the Saudi decision, but that’s hardly the whole story.

Overshadowing discussions about a possible production freeze was a new fact of life for the oil industry: the past would be no predictor of the future when it came to global oil demand.  Whatever the Saudis think of the Iranians or vice versa, their industry is being fundamentally transformed, altering relationships among the major producers and eroding their inclination to cooperate.


Until very recently, it was assumed that the demand for oil would continue to expand indefinitely, creating space for multiple producers to enter the market, and for ones already in it to increase their output.

Even when supply outran demand and drove prices down, as has periodically occurred, producers could always take solace in the knowledge that, as in the past, demand would eventually rebound, jacking prices up again. Under such circumstances and at such a moment, it was just good sense for individual producers to cooperate in lowering output, knowing that everyone would benefit sooner or later from the inevitable price increase.

But what happens if confidence in the eventual resurgence of demand begins to wither? Then the incentives to cooperate begin to evaporate, too, and it’s every producer for itself in a mad scramble to protect market share.

This new reality -- a world in which “peak oil demand,” rather than “peak oil,” will shape the consciousness of major players -- is what the Doha catastrophe foreshadowed.

At the beginning of this century, many energy analysts were convinced that we were at the edge of the arrival of “peak oil”; a peak, that is, in the output of petroleum in which planetary reserves would be exhausted long before the demand for oil disappeared, triggering a global economic crisis. As a result of advances in drilling technology, however, the supply of oil has continued to grow, while demand has unexpectedly begun to stall.

This can be traced both to slowing economic growth globally and to an accelerating “green revolution” in which the planet will be transitioning to non-carbon fuel sources. With most nations now committed to measures aimed at reducing emissions of greenhouse gases under the just-signed Paris climate accord, the demand for oil is likely to experience significant declines in the years ahead. In other words, global oil demand will peak long before supplies begin to run low, creating a monumental challenge for the oil-producing countries.

 This is no theoretical construct.  It’s reality itself.  Net consumption of oil in the advanced industrialized nations has already dropped from 50 million barrels per day in 2005 to 45 million barrels in 2014. Further declines are in store as strict fuel efficiency standards for the production of new vehicles and other climate-related measures take effect, the price of solar and wind power continues to fall, and other alternative energy sources come on line.

While the demand for oil does continue to rise in the developing world, even there it’s not climbing at rates previously taken for granted. With such countries also beginning to impose tougher constraints on carbon emissions, global consumption is expected to reach a peak and begin an inexorable decline. According to experts Thijs Van de Graaf and Aviel Verbruggen, overall world peak demand could be reached as early as 2020.

In such a world, high-cost oil producers will be driven out of the market and the advantage -- such as it is -- will lie with the lowest-cost ones. Countries that depend on petroleum exports for a large share of their revenues will come under increasing pressure to move away from excessive reliance on oil.

This may have been another consideration in the Saudi decision at Doha. In the months leading up to the April meeting, senior Saudi officials dropped hints that they were beginning to plan for a post-petroleum era and that Deputy Crown Prince bin Salman would play a key role in overseeing the transition.

On April 1st, the prince himself indicated that steps were underway to begin this process. As part of the effort, he announced, he was planning an initial public offering of shares in state-owned Saudi Aramco, the world’s number one oil producer, and would transfer the proceeds, an estimated $2 trillion, to its Public Investment Fund (PIF).

“IPOing Aramco and transferring its shares to PIF will technically make investments the source of Saudi government revenue, not oil,” the prince pointed out. “What is left now is to diversify investments. So within 20 years, we will be an economy or state that doesn’t depend mainly on oil.”

For a country that more than any other has rested its claim to wealth and power on the production and sale of petroleum, this is a revolutionary statement. If Saudi Arabia says it is ready to begin a move away from reliance on petroleum, we are indeed entering a new world in which, among other things, the titans of oil production will no longer hold sway over our lives as they have in the past.

This, in fact, appears to be the outlook adopted by Prince Mohammed in the wake of the Doha debacle.  In announcing the kingdom’s new economic blueprint on April 25th, he vowed to liberate the country from its “addiction” to oil.”  This will not, of course, be easy to achieve, given the kingdom’s heavy reliance on oil revenues and lack of plausible alternatives.

The 30-year-old prince could also face opposition from within the royal family to his audacious moves (as well as his blundering ones in Yemen and possibly elsewhere).  Whatever the fate of the Saudi royals, however, if predictions of a future peak in world oil demand prove accurate, the debacle in Doha will be seen as marking the beginning of the end of the old oil order.

• Michael T. Klare, a TomDispatch regular, is a professor of peace and world security studies at Hampshire College and the author, most recently, of The Race for What’s Left. A documentary movie version of his book Blood and Oil is available from the Media Education Foundation. Follow him on Twitter at @mklare1.

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Why we're so unhealthy

SUBHEAD: The sickening stranglehold Corporate America and government agencies have on our diet and health.

By Charles Hugh Smith on 29 April 2016 for Peak Prosperity -
(http://www.peakprosperity.com/blog/98031/why-were-so-unhealthy)


Image above: Illustration on how free-standing emergency rooms are gouging the public. From (http://www.dmagazine.com/publications/d-ceo/2016/may/freestanding-emergency-rooms).

That America is in the throes of a systemic health crisis can no longer be denied. According to the U.S. Department of Health And Human Services, more than two-thirds (68.8 percent) of adults are overweight or obese.  Overweight is typically defined as a body-mass index (BMI) of 25 or higher.
 A BMI of 24.9 is not exactly featherweight; I would have to add 30 pounds to reach a BMI of 24.9.

The health risks of being overweight or obese include:
  • type 2 diabetes
  • heart disease
  • high blood pressure
  • nonalcoholic fatty liver disease (excess fat and inflammation in the liver of people who drink little or no alcohol)
  • osteoarthritis (a health problem causing pain, swelling, and stiffness in one or more joints)
  • some types of cancer: breast, colon, endometrial (related to the uterine lining), and kidney
  • stroke
Since the early 1960s, the prevalence of obesity among adults more than doubled, increasing from 13.4 to 35.7 percent in U.S. adults age 20 and older.  (Source)

The Journal of the American Medical Association (JAMA) reported in 2015 that roughly half of all adult Americans are diabetic or prediabetic (also called metabolic syndrome).

If we add up everyone in America who is either suffering from or at risk of lifestyle-related diseases such as heart disease, diabetes and lifestyle-related types of cancer, it’s clear this is an unprecedented national health crisis that has no easy or cheap medical fix.

Why have we become so unhealthy?

The answers come thick and fast. We are more sedentary as most work is now white-collar; the foods low-income people can afford are unhealthy; children now spend time playing digital games rather than playing outside; serving sizes of sodas and other high-calorie/low nutrition beverages have ballooned; people buy more convenience and fast foods and prepare fewer meals at home, and so on.

Two things are clear: there is no one solution to the epidemic of lifestyle-related diseases. Limiting sodas in schools and demanding better labeling of food are examples of reforms that are well-intended, but have so far had little effect on the expanding waistlines of Americans or their ill-health.

The second is expressed by the Chinese proverb: “Diseases enter through the mouth,” i.e. disease is a result of what we eat and drink. Since what we eat has an enormous impact on our health, if we want to tackle our health crisis in a manner that get results, we must start with what we eat and how our food is grown, processed and prepared.

Once we start examining our diet, we have to examine where our food comes from, how it is grown/raised and how it is processed for consumers.

A second Chinese proverb explains why we must start with diet: “When you’re thirsty, it’s too late to dig a well.”  If we want to avoid lifestyle illnesses, we must start pursuing a new way of growing and preparing food now, not after we’re already ill.

The long lists of contributory factors to our growing ill-health distract us from the real source of our national health crisis: our food/illness/healthcare system is sick, and so it’s no wonder we’re sick, too.  The only possible result of our unhealthy food/illness/healthcare care system is ill-health.

Understanding the Food / Illness / Healthcare System
To understand why this is so, we must start with the fact that we live in a highly centralized government/private-sector system that limits our choices to maximize the profits of corporate cartels.

Big Agriculture, Big Oil-Ag Chemicals, Big GMO seeds (Monsanto et al.), Big Processed Foods, Big Supermarkets, Big Fast Food, Big Healthcare (what I have called sickcare for many years, because profits flow not from keeping us healthy via prevention but from keeping us alive when we’re suffering from chronic lifestyle illnesses) and last but not least Big Pharma, which is happy to provide medications that costs tens of thousands of dollars per patient per year to address the symptoms of lifestyle diseases rather than the causes, which trace back to what we eat and how we live.

Once you hear an alternative account of how we could be raising food and delivering it to consumers to prepare at home, you grasp the sickening stranglehold Corporate America and government agencies have on our food, diet and the resulting epidemic of ill-health.

I was fortunate to attend a permaculture conference, 'Better Soil, Better Food...A Better World' at Tara Firma Farms in Petaluma, California this past weekend that Adam Taggart (co-founder of Peak Prosperity) was responsible for producing.

Joel Salatin (author of nine books, including Everything I Want To Do Is Illegal: War Stories from the Local Food Front and head farmer at Polyface Farms, Virginia), Paul Kaiser (Singing Frogs Farm, Sonoma, California), Toby Hemenway (author of Gaia's Garden: A Guide to Home-Scale Permaculture, 2nd Edition), and Robb Wolf (author of The Paleo Solution: The Original Human Diet) were on hand to explain the connections between the way our food is grown, processed and distributed and our ill-health.

Though these connections are common sense—we all know about garbage in, garbage out—the linkage between our extractive, monoculture agriculture and all the other subsystems of food and health remains opaque to most Americans.

Centralized Systems Are Hijacked By Those Who Profit Most From Them


Centralized systems are inevitably hijacked by vested interests in a way that is simply not possible in highly decentralized systems.  Powerful vested interests rig centralized systems to protect and extend their privileges and profits.  This dynamic is a positive (self-reinforcing) feedback loop: the greater the centralization, the greater the influence of vested interests, who increase the centralization that benefits them.

Though it is poorly understood by conventional economists and political scientists, centralization makes it inevitable that the interests that benefit most from centralization (corporations) will serve their self-interests by gaining control of centralized power via lobbying and political contributions.

Once entrenched interests have purchased influence over politicians and regulatory agencies, they use the power of centralized government to limit competition by erecting regulatory barriers.  The regulatory system is soon approving whatever reaps the most profit for the big corporations and restricting alternatives to corporate products.

Before centralized federal and state government agencies and big corporations became dominant, decentralized family-owned farms and grocery stores were the norm. Anyone seeking to control the entire sector faced an essentially impossible task.

Now, a handful of corporations control key sectors of the food/healthcare complex: seeds, chemical fertilizers, processing of food into consumer products, distribution to consumers via grocery chains and the fast-food industry, and the healthcare/pharmaceutical sectors.

This concentration of power over our food and health is presented as the lowest-cost and most efficient system possible: concentrated ownership and control, we’re told, enables vast economies of scale that lower the cost to consumers. While this might be true of grains, it is not true of healthcare.

And since food and health are causally connected, we have to consider the total system costs: not just the cost at the grocery store or fast-food outlet, but the eventual costs of low-quality food and an unhealthy diet.

Once we consider total system costs, we have to include healthcare: the American healthcare system is the most expensive per capita on the planet, over-delivering costly (and often questionable or needless) tests, procedures and medications, and under-delivering affordable preventative care and well-being.

While it’s impossible to break out the eventual system costs of poor diet, the preponderance of lifestyle-related diseases that end up being treated suggest the percentage of healthcare related to diet and lifestyle (fitness, sufficient sleep, etc.) is substantial.

Though the mainstream media paints skyrocketing healthcare costs as the result of costly new technologies and drugs, the unspoken reality is that higher costs also reflect cartels being able to raise prices without fear of competition and the declining health of Americans.

Though the naked eye could not possibly discern the consequences of this monoculture mode of growing tomatoes, studies have found that each acre of tilled bare soil loses tons of topsoil to erosion of wind and rain every year.

As for the nutritional content of the tomatoes: as an experiment, we took some of the fallen tomatoes home to see if they ever ripened enough to become soft. They never did; they remained hard and tasteless, even in a bowl of fruit that naturally emitted ripening ethylene.

What was the nutritional content of this tasteless product of monoculture? Only a lab test could tell, but it was a good bet the nutritional content was as poor as the taste.

These indestructible tasteless tomatoes were undoubtedly bred to become tomato sauce in some distant processing plant, bound for wholesalers and retailers who end up taking most of the consumers’ dollar.

It Doesn’t Have To Be This Way

It doesn’t have to be this way. Regenerative agricultural practices actually build soils rather than strip-mining them. Consumer-supported agriculture (CSA) cuts out the corporate middlemen and delivers high-quality food directly to consumers.

If we consider that Americans throw away 40% of all food they purchase, it’s not hard to see another option: waste nothing and spend the savings on higher quality food.

High-quality vegetables can be grown in cities, lowering cost and raising access (see: A guerilla gardener in South Central L.A.)

My time this past weekend with Joel Salatin, Toby Hemenway and the folks from Singing Frogs Farm was filled with compelling yet practical steps each of us can and should take in our lives to take more control over our health -- in ways that are easy, enjoyable and result in big improvements to our quality of life.








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The Death of the Fossil Fuel

SUBHEAD: In two decades the value of energy produced via fossil fuel extraction has plummeted by half.

By Nafeez Ahmed on 22 April 2016 for AlterNet -
(http://www.alternet.org/environment/we-could-be-witnessing-death-fossil-fuel-industry-will-it-take-rest-economy-down-it)

http://www.islandbreath.org/2016Year/04/160425oilfieldbig.jpg
Image above: Photo graph of oilfield in Belridge. California in 2003 by Edward Burtynsky.  Click on image to enlarge. From (http://www.edwardburtynsky.com/site_contents/Photographs/Oil.html).

We Could Be Witnessing the Death of the Fossil Fuel Industry—Will It Take the Rest of the Economy Down With It?

It’s not looking good for the global fossil fuel industry. Although the world remains heavily dependent on oil, coal and natural gas—which today supply around 80 percent of our primary energy needs—the industry is rapidly crumbling.

This is not merely a temporary blip, but a symptom of a deeper, long-term process related to global capitalism’s escalating overconsumption of planetary resources and raw materials.

New scientific research shows that the growing crisis of profitability facing fossil fuel industries is part of an inevitable period of transition to a post-carbon era.

But ongoing denialism has led powerful vested interests to continue clinging blindly to their faith in fossil fuels, with increasingly devastating and unpredictable consequences for the environment.

Bankruptcy epidemic

In February, the financial services firm Deloitte predicted that over 35 percent of independent oil companies worldwide are likely to declare bankruptcy, potentially followed by a further 30 percent next year—a total of 65 percent of oil firms around the world. Since early last year, already 50 North American oil and gas producers have filed bankruptcy.

The cause of the crisis is the dramatic drop in oil prices—down by two-thirds since 2014—which are so low that oil companies are finding it difficult to generate enough revenue to cover the high costs of production, while also repaying their loans.

Oil and gas companies most at risk are those with the largest debt burden. And that burden is huge—as much as $2.5 trillion, according to The Economist. The real figure is probably higher.

At a speech at the London School of Economics in February, Jaime Caruana of the Bank for International Settlements said that outstanding loans and bonds for the oil and gas industry had almost tripled between 2006 and 2014 to a total of $3 trillion.

This massive debt burden, he explained, has put the industry in a double-bind: In order to service the debt, they are continuing to produce more oil for sale, but that only contributes to lower market prices. Decreased oil revenues means less capacity to repay the debt, thus increasing the likelihood of default.

Stranded assets

This $3 trillion of debt is at risk because it was supposed to generate a 3-to-1 increase in value, but instead—thanks to the oil price decline—represents a value of less than half of this.

Worse, according to a Goldman Sachs study quietly published in December last year, as much as $1 trillion of investments in future oil projects around the world are unprofitable; i.e., effectively stranded.

Examining 400 of the world’s largest new oil and gas fields (except U.S. shale), the Goldman study found that $930 billion worth of projects (more than two-thirds) are unprofitable at Brent crude prices below $70. (Prices are now well below that.)

The collapse of these projects due to unprofitability would result in the loss of oil and gas production equivalent to a colossal 8 percent of current global demand. If that happens, suddenly or otherwise, it would wreck the global economy.

The Goldman analysis was based purely on the internal dynamics of the industry. A further issue is that internationally-recognized climate change risks mean that to avert dangerous global warming, much of the world’s remaining fossil fuel resources cannot be burned.

All of this is leading investors to question the wisdom of their investments, given fears that much of the assets that the oil, gas and coal industries use to estimate their own worth could consist of resources that will never ultimately be used.

The Carbon Tracker Initiative, which analyzes carbon investment risks, points out that over the next decade, fossil fuel companies risk wasting up to $2.2 trillion of investments in new projects that could turn out to be “uneconomic” in the face of international climate mitigation policies.

More and more fossil fuel industry shareholders are pressuring energy companies to stop investing in exploration for fear that new projects could become worthless due to climate risks.

“Clean technology and climate policy are already reducing fossil fuel demand,” said James Leaton, head of research at Carbon Tracker. “Misreading these trends will destroy shareholder value. Companies need to apply 2C stress tests to their business models now.”

In a prescient report published last November, Carbon Tracker identified the energy majors with the greatest exposures—and thus facing the greatest risks—from stranded assets: Royal Dutch Shell, Pemex, Exxon Mobil, Peabody Energy, Coal India and Glencore.

At the time, the industry scoffed at such a bold pronouncement. Six months after this report was released—a week ago—Peabody went bankrupt. Who’s next?

The Carbon Tracker analysis may underestimate the extent of potential losses. A new paper just out in the journal Applied Energy, from a team at Oxford University’s Institute for New Economic Thinking, shows that the “stranded assets” concept applies not just to unburnable fossil fuel reserves, but also to a vast global carbon-intensive electricity infrastructure, which could be rendered as defunct as the fossil fuels it burns and supplies to market.

The coming debt spiral

Some analysts believe the hidden trillion-dollar black hole at the heart of the oil industry is set to trigger another global financial crisis, similar in scale to the Dot-Com crash.

Jason Schenker, president and chief economist at Prestige Economics, says: “Oil prices simply aren’t going to rise fast enough to keep oil and energy companies from defaulting. Then there is a real contagion risk to financial companies and from there to the rest of the economy.”

Schenker has been ranked by Bloomberg News as one of the most accurate financial forecasters in the world since 2010. The US economy, he forecasts, will dip into recession at the end of 2016 or early 2017.

Mark Harrington, an oil industry consultant, goes further. He believes the resulting economic crisis from cascading debt defaults in the industry could make the 2007-8 financial crash look like a cakewalk. “Oil and gas companies borrowed heavily when oil prices were soaring above $70 a barrel,” he wrote on CNBC in January.

“But in the past 24 months, they’ve seen their values and cash flows erode ferociously as oil prices plunge—and that’s made it hard for some to pay back that debt. This could lead to a massive credit crunch like the one we saw in 2008. With our economy just getting back on its feet from the global 2008 financial crisis, timing could not be worse.”

Ratings agency Standard & Poor (S&P) reported this week that 46 companies have defaulted on their debt this year—the highest levels since the depths of the financial crisis in 2009. The total quantity in defaults so far is $50 billion.

Half this year’s defaults are from the oil and gas industry, according to S&P, followed by the metals, mining and the steel sector. Among them was coal giant Peabody Energy.

Despite public reassurances, bank exposure to these energy risks from unfunded loan facilities remains high. Officially, only 2.5 percent of bank assets are exposed to energy risks.

But it’s probably worse. Confidential Wall Street sources claim that the Federal Reserve in Dallas has secretly advised major U.S. banks in closed-door meetings to cover-up potential energy-related losses. The Federal Reserve denies the allegations, but refuses to respond to Freedom of Information requests on internal meetings, on the obviously false pretext that it keeps no records of any of its meetings.

According to Bronka Rzepkoswki of the financial advisory firm Oxford Economics, over a third of the entire U.S. high yield bond index is vulnerable to low oil prices, increasing the risk of a tidal wave of corporate bankruptcies: “Conditions that usually pave the way for mounting defaults—such as growing bad debt, tightening monetary conditions, tightening of corporate credit standards and volatility spikes – are currently met in the U.S.”

The end of cheap oil

Behind the crisis of oil’s profitability that threatens the entire global economy is a geophysical crisis in the availability of cheap oil. Cheap here does not refer simply to the market price of oil, but the total cost of production. More specifically, it refers to the value of energy.

There is a precise scientific measure for this, virtually unknown in conventional economic and financial circles, known as Energy Return on Investment—which essentially quantifies the amount of energy extracted, compared to the inputs of energy needed to conduct the extraction. The concept of EROI was first proposed and developed by Professor Charles A. Hall of the Department of Environmental and Forest Biology at the State University of New York. He found that an approximate EROI value for any energy source could be calculated by dividing the quantity of energy produced by the amount of energy inputted into the production process.

Therefore, the higher the EROI, the more energy that a particular source and technology is capable of producing. The lower the EROI, the less energy this source and technology is actually producing.

A new peer-reviewed study led by the Institute of Physics at the National Autonomous University of Mexico has undertaken a comparative review of the EROI of all the major sources of energy that currently underpin industrial civilization—namely oil, gas, coal, and uranium.

Published in the journal Perspectives on Global Development and Technology, the scientists note that the EROI for fossil fuels has inexorably declined over a relatively short period of time: “Nowadays, the world average value EROI for hydrocarbons in the world has gone from a value of 35 to a value of 15 between 1960 and 1980.”

In other words, in just two decades, the total value of the energy being produced via fossil fuel extraction has plummeted by more than half. And it continues to decline.

This is because the more fossil fuel resources that we exploit, the more we have used up those resources that are easiest and cheapest to extract. This compels the industry to rely increasingly on resources that are more difficult and expensive to get out of the ground, and bring to market.

The EROI for conventional oil, according to the Mexican scientists, is 18. They estimate, optimistically, that: “World reserves could last for 35 or 45 years at current consumption rates.” For gas, the EROI is 10, and world reserves will last around “45 or 55 years.” Nuclear’s EROI is 6.5, and according to the study authors, “The peak in world production of uranium will be reached by 2045.”

The problem is that although we are not running out of oil, we are running out of the cheapest, easiest to extract form of oil and gas. Increasingly, the industry is making up for the shortfall by turning to unconventional forms of oil and gas—but these have very little energy value from an EROI perspective.

The Mexico team examine the EROI values of these unconventional sources, tar sands, shale oil, and shale gas: “The average value for EROI of tar sands is four. Only ten percent of that amount is economically profitable with current technology.”

For shale oil and gas, the situation is even more dire: “The EROI varies between 1.5 and 4, with an average value of 2.8. Shale oil is very similar to the tar sands; being both oil sources of very low quality. The shale gas revolution did not start because its exploitation was a very good idea; but because the most attractive economic opportunities were previously exploited and exhausted.”

In effect, the growing reliance on unconventional oil and gas has meant that, overall, the costs and inputs into energy production to keep industrial civilization moving are rising inexorably.

It’s not that governments don’t know. It’s that decisions have already been made to protect the vested interests that have effectively captured government policymaking through lobbying, networking and donations.

Three years ago, the British government’s Department for International Development (DFID) commissioned and published an in-depth report, “EROI of Global Energy Resources: Status, Trends and Social Implications.” The report went completely unnoticed by the media.

Its findings are instructive: “We find the EROI for each major fossil fuel resource (except coal) has declined substantially over the last century. Most renewable and non-conventional energy alternatives have substantially lower EROI values than conventional fossil fuels.”

The decline in EROI has meant that an increasing amount of the energy we extract is having to be diverted back into getting new energy out, leaving less for other social investments.

This means that the global economic slowdown is directly related to the declining resource quality of fossil fuels. The DFID report warns: “The declining EROI of traditional fossil fuel energy sources and its eventual effect on the world economy are likely to result in a myriad of unforeseen consequences.”

Shortly after this report was released, I met with a senior civil servant at DFID familiar with its findings, who spoke to me on condition of anonymity. I asked him whether this important research had actually impacted policymaking in the department.

“Unfortunately, no,” he told me, shrugging. “Most of my colleagues, except perhaps a handful, simply don’t have a clue about these issues. And of course, despite the report being circulated widely within the department, and shared with other relevant government departments, there is little interest from ministers who appear to be ideologically pre-committed to fracking.”

Peak oil

The driving force behind the accelerating decline in resource quality, hotly denied in the industry, is ‘peak oil.’

An extensive scientific analysis published in February in Wiley Interdisciplinary Reviews: Energy & Environment lays bare the extent of industry denialism. Wiley Interdisciplinary Reviews (WIRES) is a series of high-quality peer-reviewed publications which runs authoritative reviews of the literature across relevant academic disciplines.

The new WIRES paper is authored by Professor Michael Jefferson of the ESCP Europe Business School, a former chief economist at oil major Royal Dutch/Shell Group, where he spent nearly 20 years in various senior roles from Head of Planning in Europe to Director of Oil Supply and Trading. He later became Deputy Secretary-General of the World Energy Council, and is editor of the leading Elsevier science journal Energy Policy.

In his new study, Jefferson examines a recent 1865-page “global energy assessment” (GES) published by the International Institute of Applied Systems Analysis. But he criticized the GES for essentially ducking the issue of ‘peak oil.”

“This was rather odd,” he wrote. “First, because the evidence suggests that the global production of conventional oil plateaued and may have begun to decline from 2005.”

He went on to explain that standard industry assessments of the size of global conventional oil reserves have been dramatically inflated, noting how “the five major Middle East oil exporters altered the basis of their definition of ‘proved’ conventional oil reserves from a 90 percent probability down to a 50 percent probability from 1984. The result has been an apparent (but not real) increase in their ‘proved’ conventional oil reserves of some 435 billion barrels.”

Added to those estimates are reserve figures from Venezuelan heavy oil and Canadian tar sands, bringing up global reserve estimates by a further 440 billion barrels, despite the fact that they are “more difficult and costly to extract” and generally of “poorer quality” than conventional oil.

“Put bluntly, the standard claim that the world has proved conventional oil reserves of nearly 1.7 trillion barrels is overstated by about 875 billion barrels. Thus, despite the fall in crude oil prices from a new peak in June, 2014, after that of July, 2008, the ‘peak oil’ issue remains with us.”

Jefferson believes that a nominal economic recovery, combined with cutbacks in production as the industry reacts to its internal crises, will eventually put the current oil supply glut in reverse. This will pave the way for “further major oil price rises” in years to come.

It’s not entirely clear if this will happen. If the oil crisis hits the economy hard, then the prolonged recession that results could dampen the rising demand that everyone projects. If oil prices thus remain relatively depressed for longer than expected, this could hemorrhage the industry beyond repair.

Eventually, the loss of production may allow prices to rise again. OPEC estimates that investments in oil exploration and development are at their lowest level in six years. As bankruptcies escalate, the accompanying drop in investments will eventually lead world oil production to fall, even as global demand begins to rise.

This could lead oil prices to climb much higher, as rocketing demand—projected to grow 50 percent by 2035—hits the scarcity of production. Such a price spike, ironically, would also be incredibly bad for the global economy, and as happened with the 2007-8 financial crash, could feed into inflation and trigger another spate of consumer debt-defaults in the housing markets.

Even if that happens, the assumption—the hope—is that oil industry majors will somehow survive the preceding cascade of debt-defaults. The other assumption, is that demand for oil will rise.

But as new sources of renewable energy come online at a faster and faster pace, as innovation in clean technologies accelerates, old fossil fuel-centric projections of future rising demand for oil may need to be jettisoned.

Clean energy

According to another new study released in March in Energy Policy by two scientists at Texas A&M University, “Non-renewable energy”—that is “fossil fuels and nuclear power”—“are projected to peak around mid-century ... Subsequent declining non-renewable production will require a rapid expansion in the renewable energy sources (RES) if either population and/or economic growth is to continue.”

The demise of the fossil fuel empire, the study forecasts, is inevitable. Whichever model run the scientists used, the end output was the same: the almost total displacement of fossil fuels by renewable energy sources by the end of the century; and, as a result, the transformation and localization of economic activity.

But the paper adds that to avoid a rise in global average temperatures of 2C, which would tip climate change into the danger zone, 50 percent or more of existing fossil fuel reserves must remain unused.

The imperative to transition away from fossil fuels is, therefore, both geophysical and environmental. On the one hand, by mid-century, fossil fuels and nuclear power will become obsolete as a viable source of energy due to their increasingly high costs and low quality. On the other, even before then, to maintain what scientists describe as a ‘safe operating space’ for human survival, we cannot permit the planet to warm a further 2C without risking disastrous climate impacts.

Staying below 2C, the study finds, will require renewable energy to supply more than 50 percent of total global energy by 2028, “a 37-fold increase in the annual rate of supplying renewable energy in only 13 years.”

While this appears to be a herculean task by any standard, the Texas A&M scientists conclude that by century’s end, the demise of fossil fuels is going to happen anyway, with or without considerations over climate risks:

… the ‘ambitious’ end-of-century decarbonisation goals set by the G7 leaders will be achieved due to economic and geologic fossil fuel limitations within even the unconstrained scenario in which little-to-no pro-active commitment to decarbonise is required… Our model results indicate that, with or without climate considerations, RES [renewable energy sources] will comprise 87–94 percent of total energy demand by the end of the century.

But as renewables have a much lower EROI than fossil fuels, this will “quickly reduce the share of net energy available for societal use.” With less energy available to societies, “it is speculated that there will have to be a reprioritization of societal energetic needs”—in other words, a very different kind of economy in which unlimited material growth underpinned by endless inputs of cheap fossil fuel energy are a relic of the early 21st century.

The 37-fold annual rate of increase in the renewable energy supply seems unachievable at first glance, but new data just released from the Abu Dhabi-based International Renewable Energy Agency shows that clean power is well on its way, despite lacking the massive subsidies behind fossil fuels.

The data reveals that last year, solar power capacity rose by 37 percent. Wind power grew by 17 percent, geothermal by 5 percent and hydropower by 3 percent.

So far, the growth rate for solar power has been exponential. A Deloitte Center for Energy Solutions report from September 2015 noted that the speed and spread of solar energy had consistently outpaced conventional linear projections, and continues to do so.

While the costs of solar power is consistently declining, solar power generation has doubled every year for the last 20 years. With every doubling of solar infrastructure, the production costs of solar photovoltaic (PV) has dropped by 22 percent.

At this rate, according to analysts like Tony Seba—a lecturer in business entrepreneurship, disruption and clean energy at Stanford University—the growth of solar is already on track to go global. With eight more doublings, that’s by 2030, solar power would be capable of supplying 100 percent of the world’s energy needs. And that’s even without the right mix of government policies in place to support renewables.

According to Deloitte, while Seba’s forecast is endorsed by a minority of experts, it remains a real possibility that should be taken seriously. But the firm points out that obstacles remain:

“It would not make economic sense for utility planners to shutter thousands of megawatts of existing generating capacity before the end of its economic life and replace it with new solar generation.”

Yet Deloitte’s study did not account for the escalating crisis in profitability already engulfing the fossil fuel industries, and the looming pressure of stranded assets due to climate risks. As the uneconomic nature of fossil fuels becomes evermore obvious, so too will the economic appeal of clean energy.

Race against time

The question is whether the transition to a post-carbon energy system—the acceptance of the inevitable death of the oil economy—will occur fast enough to avoid climate catastrophe.

Given that the 2C target for a safe climate is widely recognized to be inadequate—scientists increasingly argue that even a 1C rise in global average temperatures would be sufficient to trigger dangerous, irreversible changes to the earth’s climate.

According to a 2011 report by the National Academy of Sciences, the scientific consensus shows conservatively that for every degree of warming, we will see the following impacts: 5-15 percent reductions in crop yields; 3-10 percent increases in rainfall in some regions contributing to flooding; 5-10 percent decreases in stream-flow in some river basins, including the Arkansas and the Rio Grande, contributing to scarcity of potable water; 200-400 percent increases in the area burned by wildfire in the US; 15 percent decreases in annual average Arctic sea ice, with 25 percent decreases in the yearly minimum extent in September.

Even if all CO2 emissions stopped, the climate would continue to warm for several more centuries. Over thousands of years, the National Academy warns, this could unleash amplifying feedbacks leading to the disappearance of the polar ice sheets and other dramatic changes. In the meantime, the risk of catastrophic wild cards “such as the potential large-scale release of methane from deep-sea sediments” or permafrost, is impossible to quantify.

In this context, even if the solar-driven clean energy revolution had every success, we still need to remove carbon that has already accumulated in the atmosphere, to return the climate to safety.

The idea of removing carbon from the atmosphere sounds technologically difficult and insanely expensive. It’s not. In reality, it is relatively simple and cheap.

A new book by Eric Toensmeier, a lecturer at Yale University’s School of Forestry and Environmental Studies, The Carbon Farming Solution, sets out in stunningly accessible fashion how ‘regenerative farming’ provides the ultimate carbon-sequestration solution.

Regenerative farming is a form of small-scale, localised, community-centred organic agriculture which uses techniques that remove carbon from the atmosphere, and sequester it in plant material or soil.

Using an array of land management and conservation practices, many of which have been tried and tested by indigenous communities, it’s theoretically possible to scale up regenerative farming methods in a way that dramatically offsets global carbon emissions.

Toensmeier’s valuable book discusses these techniques, and unlike other science-minded tomes, offers a practical toolkit for communities to begin exploring how they can adopt regenerative farming practices for themselves.

According to the Rodale Institute, the application of regenerative farming on a global scale could have revolutionary results:

Simply put, recent data from farming systems and pasture trials around the globe show that we could sequester more than 100 percent of current annual CO2 emissions with a switch to widely available and inexpensive organic management practices, which we term ‘regenerative organic agriculture’… These practices work to maximize carbon fixation while minimizing the loss of that carbon once returned to the soil, reversing the greenhouse effect.

This has been widely corroborated. For instance, a 2015 study part-funded by the Chinese Academy of Sciences found that “replacing chemical fertilizer with organic manure significantly decreased the emission of GHGs [greenhouse gases].

Yields of wheat and corn also increased as the soil fertility was improved by the application of cattle manure. Totally replacing chemical fertilizer with organic manure decreased GHG emissions, which reversed the agriculture ecosystem from a carbon source… to a carbon sink.”

Governments are catching on, if slowly. At the Paris climate talks, 25 countries and over 50 NGOs signed up to the French government’s ‘4 per 1000’ initiative, a global agreement to promote regenerative farming as a solution for food security and climate disaster.

The birth of post-capitalism

There can be no doubt, then, that by the end of this century, life as we know it on planet earth will be very different. Fossil fueled predatory capitalism will be dead. In its place, human civilization will have little choice but to rely on a diversity of clean, renewable energy sources.

Whatever choices we make this century, the coming generations in the post-carbon future will have to deal with the realities of an overall warmer, and therefore more unpredictable, climate. Even if regenerative processes are in place to draw-down carbon from the atmosphere, this takes time—and in the process, some of the damage climate change will wreak on our oceans, our forests, our waterways, our coasts, and our soils will be irreversible.

It could take centuries, if not millennia, for the planet to reach a new, stable equilibrium.

But either way, the work of repairing and mitigating at least some of the damage done will be the task of our childrens’ children, and their children, and on.

Economic activity in this global society will of necessity be very different to the endless growth juggernaut we have experienced since the industrial revolution. In this post-carbon future, material production and consumption, and technological innovation, will only be sustainable through a participatory ‘circular economy’ in which scarce minerals and raw materials are carefully managed.

The fast-paced consumerism that we take for granted today simply won’t work in these circumstances.

Large top-down national and transnational structures will begin to become obsolete due to the large costs of maintenance, the unsustainability of the energy inputs needed for their survival, and the shift in power to new decentralized producers of energy and food.

In the place of such top-down structures, smaller-scale, networked forms of political, social and economic organization, connected through revolutionary information technologies, will be most likely to succeed. For communities to not just survive, but thrive, they will need to work together, sharing technology, expertise and knowledge on the basis of a new culture of human parity and cooperation.

Of course, before we get to this point, there will be upheaval. Today’s fossil fuel incumbency remains in denial, and is unlikely to accept the reality of its inevitable demise until it really does drop dead.

The escalation of resource wars, domestic unrest, xenophobia, state-militarism, and corporate totalitarianism is to be expected. These are the death throes of a system that has run its course.

The outcomes of the struggles which emerge in coming decades—struggles between people and power, but also futile geopolitical struggles within the old centers of power (paralleled by misguided struggles between peoples)—is yet to be written.

Eager to cling to the last vestiges of existence, the old centers of power will still try to self-maximize within the framework of the old paradigm, at the expense of competing power-centers, and even their own populations.

And they will deflect from the root causes of the problem as much as possible, by encouraging their constituents to blame other power-centers, or worse, some of their fellow citizens, along the lines of all manner of ‘Otherizing’ constructs, race, ethnicity, nationality, color, religion and even class.

Have no doubt. In coming decades, we will watch the old paradigm cannibalize itself to death on our TV screens, tablets and cell phones. Many of us will do more than watch. We will be participant observers, victims or perpetrators, or both at once.

The only question that counts, is as follows: amidst this unfolding maelstrom, are we going to join with others to plant the seeds of viable post-carbon societies for the next generations of human-beings, or are we going to stand in the way of that viable future by giving ourselves entirely to defending our ‘interests’ in the framework of the old paradigm?

Whatever happens over coming decades, it will be the choices each of us make that will ultimately determine the nature of what survives by the end of this pivotal, transitional century.

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