Saturday, July 01, 2006

Strange Bedfellows: Making Friends in a Post-Peak World

Part One

Jenna Orkin

One of the hallmarks of addiction is that you use escalating amounts of the substance you're addicted to. Our economy, which is based on interest, guarantees addiction. Not only is growth inevitable; it's essential. The substance which feeds that growth - energy - must by definition become addictive.

No wonder that when interest was introduced in the sixteenth century, it was forbidden by the three major Western religions. [See correction in Comment 1.] They knew that when you tried to get something for nothing - when you lent a hundred pounds and got back 105 without even sharing in the risk of the enterprise for which you'd loaned the money - something was wrong. They must have said to themselves, "Where will this end?" For, preoccupied though they might have been with loftier matters, they knew that on the earthly plane, things do end.

Because our economy depends on growth and therefore on the oil on which that growth in turn depends, we have become oil addicts. So what should we do now that it's heading down its post-peak production slope?

One option is, we can change drugs. We can build nuclear power plants, thereby switching our addiction from oil to uranium supplemented by ethanol, coal and renewables because suddenly, now that Mother Nature is striking back with a vengeance in the form of earthquakes and hurricanes, we care about the environment. That way we don't have to wean ourselves from addiction at all.

Or we could go into Rehab. That would take a real effort and severely cramp our style. It wouldn't be fun but we might be willing to do it as long as no one else was having any fun either.

Trouble is, everyone else is an actual or aspiring addict too. What if we go into Rehab but we're surrounded by crazed addicts? They'll get all the good stuff which will fuel them with a manic energy to grab even more.

That is the prisoner's dilemma that we're faced with.

The original prisoner's dilemma is this: Two suspects get arrested. The police don't have enough evidence to convict either of them and need testimony. If one prisoner testifies against the other and the other remains silent, the betrayer goes free and the silent accomplice receives the full 10-year sentence. If both stay silent, the police can sentence both prisoners to only six months in jail for a minor charge. If each betrays the other, each will receive a two-year sentence.

Each prisoner must choose whether to betray the other or to remain silent. However, neither prisoner knows what choice the other prisoner will make. For the best total outcome, a sentence of six months for both prisoners, each prisoner has to rely on the honor or shrewdness of the other prisoner.

That's the dilemma we face if we go into Rehab with respect to our energy addiction. If everyone goes into Rehab, fine. But if one country reneges on the deal, they get all the good stuff or in this case, resources.

Can we trust other countries to stick to the deal?

Only if it's in their own best interest.

Will they perceive it to be in their own best interest?

Only if they feel they need us.

Do countries need each other?

Not if they're at the top of the heap.

So that is what everyone has decided to do: To scramble to the top of the heap because they think they have a chance of making it.

Thus there's a lot of saber-rattling going on. Recently Iran conducted Holy Prophet naval exercises complete with flying boats to show their neighbors their "peaceful intentions." By way of response, the United States conducted naval exercises in the Bahamas in order to show our peaceful intentions towards Venezuela, which has sought closer ties to Iran as well as to our erstwhile pinko enemies, Russia and Cuba. And India sent a ship to the Maldives to patrol the Exclusive Economic Zone, a phrase which refers to fishing and seabed mining.

Certainly no one's putting brakes on their economy. Those U.S. wannabes, China and India, are obsessed with feeding theirs, like the doting parents of monster children who refuse to see that when those children grow up, they'll eat their parents too. Since neither country is endowed with the necessary natural resources, they're doing what anyone does who needs something: They're making friends.

China is jumping into the Free Trade Agreement fray with New Zealand, expects to sign a Free Trade Agreement with Austalia in two years and has pledged $374 million in loans to Pacific allies to boost economic cooperation. Chinese Premier Wen Jiabao said, "the loans would target various industries including mining, agriculture, forestry, fisheries and aviation."

"China has funding and technical expertise," [Jiabao] said. "The island countries are rich in natural resources. Herein lie huge potential for bilateral cooperation."

Translation: "We'll provide the money to help you help us ravage your country."

Jiabao maintained that the agreement came with no political strings attached. But it included only those South Pacific countries whose governments have diplomatic relations with China -- the Cook Islands, Fiji, Micronesia, Niue, Papua New Guinea, Samoa, Tonga and Vanuatu and excluded six countries that have relations with Taiwan -- Kiribati, the Marshall Islands, Nauru, Palau, the Solomon Islands and Tuvalu.

The One China Policy was also a feature of China's recent expressions of harmonious intent towards Malaysia and the Sudan whose army is getting 'cooperation' from Chinese forces.

This 'cooperation' may be the underlying reason why the United States has recently become preoccupied with the human rights abuses for which the Sudan is notorious. Our concern is ironic because, according to a Human Rights Watch Report of 2003, many of those abuses are the work of foreign oil companies.........

5 comments:

Jenna Orkin said...

I've amended the article to refer to your correction. i thought Jesus got angry with 'money changers' which i interpreted to mean people changing from one currency to another but of course, now that you mention it, that seems unlikely for jerusalem, if jerusalem was indeed where that happened.

Jenna Orkin said...
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Jenna Orkin said...

if you google "Jesus" and "Usury" you get 254,000 cites, complete with parables. Below is the first. Interesting, however, how all three major Western religions managed to reconcile themselves to the notion of interest (Islam apparently less than the other two.)

http://64.233.161.104/search?q=cache:XClVtlqyDjkJ:www.biblebelievers.org.au/usury2.htm+%22jesus%22+usury&hl=en&gl=us&ct=clnk&cd=1&ie=UTF-8

Jenna Orkin said...

no coincidence. but i also wonder what's going on with their euro-based oil bourse.

in one of the other threads someone provided the link to mike's sept 9 2001 economic alert which in turn incorporated an adam hamilton article from le metropole cafe about the huge investment of jp morgan chase in derivatives and the plunge protection team which, among other things, manipulates the price of gold. the stories of gold and oil are symbiotic.

Jenna Orkin said...

dennis, that's not off topic. it's bull's eye. many thanks