The Real Credit Crunch
13th April 2008
Amid all the talk of the credit crunch, and the concentration on easy fix remedies like rate cuts by the Bank of England, it is easy to overlook the underlying factors that are causing recession in the United States, the world’s largest economy, and dragging the rest of the world with it. Like the Dutch tulip mania of the seventeenth century, the bubble has burst. House prices are tumbling, jobs are being lost, and the price of food and fuel is soaring. The reasons for this recession go deeper than just the financial markets losing confidence in the ability of borrowers to repay their debts.
What we are experiencing was forecast no less than 36 years ago in a book entitled “The Limits to Growth” by Donella H Meadows, Dennis L. Meadows, and Jørgen Randers. They asked far-reaching questions such as “What will happen if growth in the world’s population continues unchecked? What will be the environmental consequences if economic growth continues at its current pace? What can be done to ensure that human economy that provides sufficiently for all and that also fits within the physical limits of the Earth?”
At the time the book caused quite a stir, leading to newspaper headlines like:
“A computer looks ahead and shudders, ” “ Study sees disaster by the year 2100” and “Scientists warn of Global Catastrophe.” However as the years went by and the world economy grew, it was easy to dismiss these words of warning. What we chose to ignore was that we have been living on the world’s capital, binge-consuming on the harvest of the forests and seas, and the unique bounty of “easy oil”. Those resources are now depleting at an alarming rate. Forests have been decimated. The atmosphere has been pumped full of carbon dioxide. The seas have been over-fished. Oil has been extracted so fast that we have reached Peak Oil much faster than even the pessimists forecast. The “easy oil” has been extracted, that is, the oil which offered the highest Energy Return On Investment (EROI), and are left with a rapidly diminishing supply of high quality crude oil, and then will be scraping the barrel for tar sands and the like.
The United States has over-extended even the resources of its huge empire, in trying to secure Iraq’s oil to prop up its energy-addicted economy. The war against insurgents has reduced the EROI and entropy has set in.
The real cause of the credit crunch in the financial markets is that we have come up against the limits to growth of the natural world. The free market disciples promised an illusion of endless growth, a bubble that has now burst, exposing the emperor wearing no clothes. You cannot achieve endless growth in a finite system. The credit crunch is just a painful reminder of the real world. Sadly there will be worse to come as the world plunges into a deep recession, peak oil drives inflation, and food prices soar out of the reach of the world’s poor. Tragically climate change will hit food production when we have allowed the world’s population to grow far beyond what can be sustained.
What should our response be? Thankfully the answer has been set out for us in simple terms in “The Transition Handbook” by Rob Hopkins. We need to begin the urgent task of converting our communities to transition neighbourhoods, in which every aspect of our lives is re-localised to remove our dependence on oil, so that we learn to be self-sufficient in food, medicine and leisure, with friends and family close at hand, rather than scattered round the country, or worse around the globe, separated from us by what George Monbiot has described as “love miles” that are killing the planet in our attempts to maintain contact. The credit crunch is a painful reality check. The natural response is one of anger and denial. There will be attempts to re-inflate the bubble. But the sooner we come to terms with the limits to growth on our unique and precious planet, the sooner we can start to process of transition to a more resilient, equitable, and sustainable future. Converting the world to the transition concept is not going to be easy, and we may have left it too late. But at least we must try, for the sake of our children.
Virgin biofuel flight - sadly deluded
25th February 2008
The sad thing is that Richard Branson probably believes that he is doing his bit to save the world in using biofuels to power some of his trains and now the first commercial airline flight. But in trying to prove that somehow flying can be anything other than an environmental disaster he is helping prolong the delusion that biofuels offer the solution to reducing greenhouse gas emissions. They don't, in fact there is research to show that in some cases, due to the oil used to make the fertiliser needed to grow them and nitrous oxide emissions, biofuels actually make things worse.
How can incorporating babassu and coconut oil from trees growing in the Amazon conceivably be sustainable or environmentally friendly if getting the oil to this country involved transporting it around the world?
Promoting biofuels also helps salve the consciences of people who have not yet grasped the fact that saving Earth's biosphere means making sacrifices, and that includes holidays that involve flying.
Branson claims that if he didn't run his airline them people would fly with someone else, but in selling seats for the first passenger flights to space he is creating a new market, not satisfying an existing one. There is also the suspicion that Branson's enthusiasm for biofuels is in part motivated by sustaining his profit margins at a time when oil prices are rising. If he is serious about doing his bit to save the planet he would cut down on his own enormous carbon footprint from his regular flights to his Necker Island, and invest the profits from Virgin in saving rainforest through a charity like Cool Earth.
Don't be a Squanderbug!
Wake up and smell the Fairtrade coffee. Climate change is already happening. We need to act now, but what can we do? When our parents or grandparents lived though World War Two, the government came up with some great ideas and slogans, some of which are useful today. One was the “Don’t be a Squanderbug” slogan, which at a time of shortages and rationing, encouraged people to consume less, and to make do and mend. Which is precisely the most effective way to combat global warming, and far more effective than recycling.
Another slogan was “Is your journey really necessary?” Again, just what we need to reduce carbon emissions. If we start living our lives more locally, a lot of journeys cease to be essential: we need to look for what we need to survive on our doorstep, to re-build our neighbourhoods, so that we have local produce, local shops, local services, and local friends and relatives. If you can’t get to your destination on foot or by bike, think: do I really need to go?
The other big wartime idea was the “Dig for Victory” campaign, that aimed to get Britain self-sufficient for food. People lost a bit of weight, but they were healthier. No-one starved. Cuba has done it, with more people back working on the land, it now uses a fraction of the oil it used to, and feeds its own people. It has a first class health service, and among the highest literacy rates in world. We don't need a dictatorship. We just need to act now. As we plan for the future, we can learn from the past.
The End of Cheap Food
The push for biofuels raises profound moral questions for anyone concerned about the environment and the developing world. It is becoming increasingly clear that the use of farmland for fuel crops is pushing up the price of food, which hits the world's poor hardest. We have been sheltered from the food riots already taking place in the Third World, but even in the West, people on low or fixed incomes are being affected by rising prices.
Some are likening the push for biofuels to a war between the world's poor and motorists. America sees biofuels as a sure winner, boosting incomes for its farmers, while reducing its dependence on imported oil, at a time when domestic oil production is falling fast, and the cost of the war in Iraq runs into billions of dollars.
Biofuels let motorists off the hook, by promoting the belief that they are somehow less polluting. Serious questions are now being raised about whether this is actually the case, with large areas of rainforest being cleared in parts of South America and Indonesia for fuel crops, rainforest which is a major carbon sink. The use of oil-based fertiliser to grow biofuels also has to be factored in, as does the nitrous oxide produced by biofuel crops. This gas is nearly 300 times as powerful as a greenhouse gas as carbon dioxide, and a recent study by
Keith Smith, a professor at the University of Edinburgh, and colleagues, found that the levels of nitrous oxide produced are twice that allowed for in the calculations of the International Panel on Climate Change.
As the TV series said, "It's not easy being green", and biofuels are not the quick fix that some environmentalists promised.
A Crisis of Spirit
Amid all the talk of crisis surrounding climate change, it seems to me that there is also a crisis of human spirit. Don't get me wrong. I am not an evangelical Christian or a Gaia-worshipping New Age mystic, rather a confirmed agnostic. But it seems to me that the feeding -frenzy of consumption indulged in by a significant proportion of the population of the Western World is part of a moral vacuum that is pervading our lives. People are consuming without thought of the consequences.......(continued)
Read "A crisis of spirit" by John Pearce, Author of "The Little Green Book"
Coming to the Boil
The green cliche of the frog in the pan of water is so worn it hardly bears repeating. The frog will jump straight out if dropped into a pan of water but boils to death as it will stay in a pan of cold water which is slowly brought to the boil. The analogy with our current lack of response to global warming which is melting the ice-caps and methane rich tundra could hardly be starker. And yet in spite of the cliche being worn it is so true. Just look at our roads. Are people using their cars less, or even beginning panic measures? I don't think so. Are people abandoning air travel, the fastest growing source of greenhouse gases. Not a bit. It is time our political leaders and media figures starting leading by example, and telling it how it is. Once climate change takes hold there is no going back, and all the money in the world will not save us. Ocean currents and patterns of wind and rainfall will change drastically, and future generations will ask why we did so little. If we were truly an intelligent species, we should be panicking. Instead we are stuck in the pan as the heat rises, blissfully unware, that like the frog, we are about to croak.
For an excellent critique of the media and political response to the current crisis:
"Notes from a dying planet" - Medialens
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The Green
Backlash Begins
6th May 2008
If 2007 was the year Britain went green, at least in terms of press coverage, 2008 looks like being the year when the green backlash began.
There are signs of a lurch to the right, with the election of the first British National Party member of the Greater London Assembly, and the election of a Conservative Party Mayor of London.
The new Mayor has been elected on a ticket of reforming the London Congestion Charge, one of Ken Livingstone's finest achievements, and of scrapping plans for a £25 a day charge on 4x4 Chelsea Tractors entering cental London. So already green reforms are being rolled back.
Signs are no better from the Labour Party, where there is already talk of scrapping the penalties for households throwing out excessive amounts of rubbish, and also of removing the already delayed 2 pence a litre on fuel.
It is clear that as house prices tumble, utility bills and inflation soar, and recession looms, there is the start of a backlash against green policies, and in some of the press the beginning of a trend to blame economic woes on environmentally-friendly policies. This does not bode well for later in the year when recession really begins to bite.
Too little, too late
2nd March 2008
It is becoming increasingly clear that we may be unable to prevent catastophic climate change. Instead of united action to cut carbon emissions, people in the developed world are largely carrying on as normal, driving their cars, flying on holidays, and consuming like there is no tomorrow, which seems likely to be the case.
Instead of declaring a state of emergency and taking drastic action the government is allowing airport expansion and more road building. Inspirational ideas like that of Matt Prescott for E-day were largely ignored or worse ridiculed. The BBC did not even have the courage to continue with the project.
The tragedy is, that had we taken united action we might have had a chance. Instead the cranks and sceptics who continue to deny global warming are given equal airtime and newspaper coverage, in the face of 99% of scientists who are telling us the urgency of the situation.
Ethical living survey
Door One conducted a survey on ethical shopping and living, with some startling results. The survey revealed that 98% of Brits don't regard Gordon Brown as a representative for ethical living, with Anita Roddick stealing top position. It also found that a massive 84% of the UK found ethical products and campaigns, such as Bono's American Express RED campaign and Anya Hindmarch's 'I'm Not a Plastic Bag', over hyped. Furthermore, a shocking third of respondents could not state where profits for ethical products go or what benefit they reap, and over two-thirds of those asked were confused over the definition of 'fair-trade'.
Door One survey - 15/6/07
Measure your
ecological footprint
Have you ever wondered how green your lifestyle is? The latest way to measure this is by assessing our ecological footprint. This is a measure of the biologically productive land that is needed to support our individual lifestyle, to produce the resources we use, including food, oil, wood and water, and also to absorb the waste that we produce, such as carbon dioxide, pollution and refuse. Worldwide, there exists about 1.8 global hectares per person with which to do this.
Our 'fair share' of the globe's resources works out at around two hectares per person per year, whereas the average person in the UK requires 5.3ha each (the equivalent of six football pitches). A flight to the east coast of America can add another two to three hectares on to your personal footprint for the year.
There are a number of websites to work out for your ecological footprint:
Ecological footprint calculators
Earthday.net/footprint
Carbonfootprint.com
Greenchoices.org
bp.com
Bestfootforward.com
Resurgence.org
To look at the impact of electronic waste try:
weeeman.org
Further reading:
Independent article
Times Online - "How to be green"
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