Anti-China campaign will backfire

In the US, both political parties are ramping up anti-China feeling.

There are several problems with this plan:

• To strike back, China need only announce intent to sell US government bonds.
• Racism tends to kill its host. East Asians in the US will become estranged.
• The US has very a serious problem -- a crumbling infrastructure.

The last point is the most important, and the least discussed. There is plenty of chatter in the US political about everything except the second law of thermodynamics. To put it simply, things decay.

Engineers calculate that the US needs $3T just to make infrastructure safe. But, on top of that, sprawl infrastructure needs constant energy input.

It will take the US many years to unwind sprawl. In that time it should not be provoking other countries.

Suddenly lots of money available, but natural limits must be considered

Human growth has pushed back the habitat of wild nature. This has led to disease epidemics.

It's time to degrow.

Printing money to hand out and stimulate the same old system that caused the problem is not a good idea. First of all, that money is no longer backed by cheap energy, so this type of stimulus will fail.

The best route is to make public services free. healthcare, education, public transportation, guaranteed housing, and such.

Helicopter money will stimulate all the wrong things

To re-stimulate the economy from the effects of the corona virus, governments and central banks will shower people with helicopter money, so named because it is like dropping cash on the population from helicopters.

This is the height of stupidity. We have the corona virus because of rampant growth. China grew so fast that natural systems were stressed to the limit.

Now, in the name of preserving a failed system and a few billionaires, money will be pushed to the bottom and create a little flurry of activity as it rushes back to the top.

It's time to recognize that growth should not be the goal. We should take advantage of the lesson nature is teaching us with the virus, and seek out gentle degrowth.

To help victims of economic shock. Make public transit, healthcare, and education free. Reform housing laws and end homelessness.

Is the Federal Reserve the main problem?

If only we could stop the Federal Reserve printing money and get back to real economy, things will be better. Is that true?

Cheap oil is over, and what is left in the ground is leveraged and re-hypothecated. The real economy is overwhelmed. It will contract one way or another.

Official world debt is over $250 Trillion. But that amount is trivial compared to the debt we owe the biosphere, a debt that cannot be paid in money.

The purpose of the money printing is to try to push the suffering onto the weak.

Right now, not on cable news, but in real life, wars for energy mean poor people are being tortured, murdered, bombed, and herded into refugee camps, and then the camps are bombed. Local economies are being drained by high interest rates. Ethnic tensions are being stoked, and massacres allowed.

Meanwhile, energy is subsidized and wasted on cars and sprawl.

The best way to reduce the pain is to undo sprawl as rapidly as possible.

Oil is not a commodity

Transport --  ships, trucks, trains, planes, and cars all depend on liquid fuel.

The cost of oil is a value-added tax that trickles through every transaction, and every physical activity, in the real economy. Cheap oil production peaked in 2005. Every day since, it takes more joules to get oil to wheels, propellers, and assembly lines than it did the day before. This is a built-in drag on the world economy.

Sitting above the real economy, central banks make up the difference by creating money on their keyboards. This increased debt creates additional economic drag by extracting interest from the real economy.

Any threat to oil-demand is a threat to the bankers. This is why they will attack free public transit.

They want to make riding public transit an unpleasant experience.

Expect attack. Expect intimidation. Expect sowing of doubt and uncertainty.

Expensive tight oil has peaked, debts defaulting, demand sagging, second correction overdue

The plateauing of conventional crude oil production in January 2005 was one of the triggers of events leading to the 2008 global financial crash, according to the report. As debt built-up in the subprime mortgage sector, the crude oil plateau drove up the underlying energy costs for the entire economy making that debt more difficult to repay—and eventually resulting in catastrophic defaults. The report warns that “unresolved” dynamics in the global energy system were only temporarily relieved due to "Quantitative Easing"—the creation of new money by central banks. A correction is now overdue, it warns.

https://www.vice.com/en_us/article/8848g5/government-agency-warns-global-oil-industry-is-on-the-brink-of-a-meltdown 

Oil industry, already desperate for customers, hit by #coronavirus

China’s oil demand amid the coronavirus outbreak is likely inflicting the worst oil demand shock to markets since the financial crisis of 2008-2009, with Chinese demand plunging by 20 percent compared to the typical demand for the season, sources with inside knowledge of the Chinese industry told Bloomberg.

https://oilprice.com/Energy/Crude-Oil/Coronavirus-Could-Cause-Chinas-Oil-Demand-To-Plunge-By-20.html#

Oil price already too low for producers, now, a new threat. Expect more money-printing and bank bailouts. Oil industry is made up of steel and cement. If these assets run under capacity, something has to give.

What's so scary about #freepublictransit?

Why is fare-free public transit/transport treated differently from other public goods? Why must there be a user-fee?

The answer lies in understanding autosprawl. Trillions of dollars have been sunk into everything from cul-de-sacs and DIY stores, to ocean tankers and refineries. The web of liquid-fuel fixed infrastructure covers human developed habitat, and controls the flow of the entire economy.

The whole thing is leveraged in debt far beyond recovery.

When oil was cheap, too much was borrowed against the future. Now, cheap oil is draining fast. Every day it takes more joules to get a joule. So now we have super-borrowing to "pay the mortgage."

When people discover the benefits of fare-free public transit, they demand more, and then they discover the subsidy to autos and sprawl. They will reject that subsidy, and demand more fare-free public transit.

This is what has the banks and bondholders shaking in their suites.

Collapse of the #autosprawl system

Households in the US owe over $13 trillion in debt. World-wide official debt is at $255 trillion.

Let's imagine that debt were to be eliminated magically by a few mistaken keystrokes. What would happen. Well a lot of rich and middle-class people would lose money. On the other hand, consumers would suddenly have much more to spend. Governments, with no more debt-service could provide much more social service.

But there is another debt that is not so easily addressed. That is the money sunk into autosprawl. The world has many $trillions invested in cars, highways, roads, suburbs, refineries, tankers, military, and much more, to support the system of autos and sprawl. These are hard assets, which depend on oil, and are not easily replaced. This investment was never sustainable, and now it is collapsing.

#renewables just add to the fire because of #jevons

Electricity demand in the country rose 36% in the seven years to April 2019 while coal-fired generation capacity during the period grew by 74% to 194.44 GW, according to the Central Electricity Authority (CEA).

http://news.trust.org/item/20190731133649-zkxm6/

India growth and plans for more growth will mean that any renewables added will not reduce fossil fuel use. They just add to the fire. Renewables promote growth. As long as there is demand, efficiencies are subsumed. Jevons principle.

US Car-loan debt at $1.2 Trillion, more payments being missed

"Some of the loans that are being given out are given out to people who probably can't afford to take out that loan," Rusch said. "[They] will not be able to repay that loan over time."
The U.S. Federal Reserve Board says the number of families missing car payments is rising, and "...there are now more subprime auto loan borrowers than ever, and thus a larger group of borrowers at high risk of delinquency."

https://www.nbcbayarea.com/news/local/Driving-Into-Debt-Americans-Owe-12-Trillion-on-Auto-Loans-513456481.html

Cars do more than burn petrol, much more.

A lot of "thinkers" are down-playing the fare-free public transit campaign because they look at cars solely for what they directly add to emissions.

The car is much more than that. It is the cigarette that delivers the cancer of sprawl and growth.

The US led, and the developed world followed, into a commitment to many $Trillions in hard-asset car-dependent infrastructure. People spread and grew, taking over farmland and forests.

By hard-assets, we mean built of steel and cement. This is the autosprawl nightmare.

Vaclav Smil: economic growth will end one way or another

... Without a biosphere in a good shape, there is no life on the planet. It’s very simple. That’s all you need to know. The economists will tell you we can decouple growth from material consumption, but that is total nonsense. The options are quite clear from the historical evidence. If you don’t manage decline, then you succumb to it and you are gone. The best hope is that you find some way to manage it. We are in a better position to do that now than we were 50 or 100 years ago, because our knowledge is much vaster. If we sit down, we can come up with something. It won’t be painless, but we can come up with ways to minimize that pain.

https://www.theguardian.com/books/2019/sep/21/vaclav-smil-interview-growth-must-end-economists? 

End of cheap energy means no more profits

Price of energy too low for producers, too high for consumers. The gap has been filled by debt. But debt is a bet on future profits, but there is no more cheap energy, so there won't be any future profits.

Our problem is not just that oil prices that are too low. Prices are too low for practically every type of energy producer, and in many parts of the globe.
...
The world economy seems to be running out of truly productive uses for debt. There are investments available, but the rate of return is very low. The lack of investments with adequate return is a significant part of what is preventing the economy from being able to support higher interest rates.

https://ourfiniteworld.com/2019/09/12/our-energy-and-debt-predicament-in-2019/

Falling net energy, capitalism, and harsh degrowth

Economists have not understood the connection between physics and the economy. There is a need for a sufficient quantity of affordable energy products every moment of every day. In fact, we seem to need a vastly increased quantity of inexpensive-to-produce energy supplies right now if we are to fix the world economy’s problems from an energy point of view. The “lower interest rates and more debt” way of hiding problems seems to be reaching an end point. If nothing else, interest rates today are close to as low as they can go. https://ourfiniteworld.com/2019/08/22/debunking-lower-oil-supply-will-raise-prices/

Since 2005, when conventional oil peaked, we have been in a situation where energy prices are too low for producers and too high for consumers. A normal biological reaction to less energy input is to reduce growth. But because of capitalism, the human species tries to violate this principle and continue growing. This can only be temporary until the laws of physics enforce harsh degrowth.

 

What does #autosprawl #meltdown look like?

https://twitter.com/NC_PPC/status/1122933439978790913

"When it comes to people and the environment, Robeson County is becoming a sacrifice zone." We are hearing about the exploitation of families in trailer park communities in Red Springs, NC #TruthAndPovertyTour pic.twitter.com/aHwVe6p25r

— North Carolina Poor People's Campaign (@NC_PPC) April 29, 2019

Capitalism planning to throw old people on the street

Rich countries like the US and Japan are struggling to make enough babies. As sizeable populations of older adults retire and age out of the workforce, younger people are having fewer kids. It's setting up a ticking demographic time bomb, readying to explode when there aren't enough young people to care and pay for what the older generation needs.

https://www.businessinsider.com/japan-demographic-time-bomb-reversing-but-us-is-in-danger-2018-7

Falling birth rates are a real problem for capitalism, a system that relies on growth to keep up it's false promises of a comfortable life. Now cheap oil is gone, and growth is over. Young people cannot afford children. So who will take the fall?

Today's retirees spent their working lives making capitalists rich. Now, suddenly, there is no money to take care of them. Where did it go?

Autosprawl is melting down

For a few decades the US took advantage of cheap oil and built massive suburbs. A lot of developers got rich.

Now the system needs repair. Roads, bridges, water lines, sewers, electric grid, schools, drainage, and such need maintenance or rebuilding. The profiteers are gone, there is no money to be made now. The urban tax base is no longer enough to support the suburbs.

"ageing population," code for falling birth rates, a huge threat to banking

Glenn Rudebusch, the San Francisco Fed’s executive vice president for research, ranks climate change as one of the three “key forces transforming the economy,” along with an aging population and rapid advances in technology. Climate change could soon hit the banking system “by storms, droughts, wildfires, and other extreme events” making it harder for businesses to repay loans.

https://grist.org/article/federal-reserve-climate-change-economy-green-bonds/

Bankers fear falling birth rates. Ironically, they will blame defaults on climate disruption, while the best way to fight climate disruption is to speed the decline of births -- a bigger cause of default.

Human population is still rising, but the people are in all the wrong places. The more developed an area, the faster the birth rate falls. Immigration from more populous areas can help but it is difficult to implement quickly enough.

Everyone should be preparing for the high unemployment that will come with debt defaults. Cut waste, get rid of cars, plant food, don't have babies.

Free public transport is key to #degrowth

...We need free public transport, new diets, denser modes of living, affordable housing close to where the jobs are, food grown closer to where it is consumed, reduction of working time and commuting, low-energy ways of living and finding satisfaction, curbs on excessive incomes and on ostentatious consumption....

https://truthout.org/articles/a-green-new-deal-must-not-be-tied-to-economic-growth/