As we've been discussing of late here at PeakProsperity.com, humans
desperately need a new story to live by. The old one is increasingly
dysfunctional and rather obviously headed for either a quite dismal or
possibly disastrous future. One of the chief impediments to recognizing the
dysfunction of the old story and adopting a new one is the most powerful of
all human emotional states: Denial.
I used to think that Desire was the most powerful human emotion because
people are prone to risking everything in their lives – careers, marriages,
relationships with their family and close friends - pursuing lust or
accumulating 10,000 times more money and possessions than they need in their
desire for “more.”
Perhaps it was my own blind spot(s) that prevented me from really
appreciating just how powerful human denial really is. But here we are, 40
years after the Club of Rome and 7 years after the Great Financial Accident
of 2008, collectively pretending that neither was a sign warning of the
dangers we face -- as a global society -- if we continue our unsustainable
policies and practices that assume perpetual growth.
Economic Denial
In the realm of economics, the level of collective denial gripping the
earth’s power centers is extraordinary. Perhaps that should be of little
surprise, as we're now at the height of the largest set of nested financial
bubbles ever blown in world history.
The bigger the bubble(s) the bigger the levels of denial required to
sustain their expansion. These bubbles are doozies, and that explains the
massive and ongoing efforts to prevent any sort of reality from creeping into
the national and global dialog.
To understand this pattern of avoidance of unpleasant realities, consider
the behavior of cities -- even entire nations -- which cannot bring
themselves to talk openly about their state of insolvency, let alone do
something about it.
Chicago has amassed debt and underfunded liabilities
totaling $63 billion, or more than $61,000 per household. Illinois
already ‘enjoys’ the second highest property tax rate in the nation at
2.28 percent of a property’s value, which means the average property tax
bill for the median home is $5,200 per year. On top of that, Illinois' income
tax is a flat 5% and brings in a total of $18 billion from 4.7 million
households, or $3,800 per household. Combined, that's $9,000 in taxes per
year per average household (which earns $38,625).
Here's the brutal math: the current city deficit is 675% of current tax
receipts. How exactly does Chicago plan to scrape another $61,000 out of each
household on top of the existing tax bills?
It doesn’t. It has no plan. The plan is to simply remain in denial and
ignore everything until it all breaks down. Which it has indeed started
to do, with the ever-late, after-the-horse-has-already-left-the-barn downgrade of the
city’s debt to junk status by Moodys.
Or perhaps we could note that of the six mayoral candidates seeking
election to run the city of Philadelphia, not
one has even talked about its massive $5.7 billion pension shortfall
during the campaign, even as they promise expanded pre-kindergarten programs
and tax cuts. Not one. Do you think that any of them has an actual plan to
address that budget gap's dream-crushing burden?
They don’t. The only ‘plan’ they have is to remain in denial and ignore
everything until it all breaks down. And then, we might guess, blame the
prior administrations.
Japan has the most debt per person of any nation in the world, standing at
nearly
$100,000 per resident. And that burden is growing every year. Yet in
2005, Japan passed an important milestone as its population peaked at 128
million. It's been declining ever since. Japan lost
244,000 net residents in 2013, and is now trundling on a downwards
population trajectory for the next 50-60 years. And at the same time, it is
growing older -- Japan has the second highest median age in the world.
Clearly that demographic profile is a recipe for economic shrinkage,
not growth. And yet the Japanese central bankers and politicians are hell-bent
on creating rapid economic growth via the twin cattle prods of reckless money
printing and excessive government borrowing. How is it that the leaders of
Japan have convinced themselves that rapid economic growth is what they need
(instead of the more rational and opposite case of managed economic
shrinkage)? What’s their plan, exactly?
They have no plan. The plan is to simply remain in denial and ignore
everything until it all breaks down.
The same story is written everywhere, with every example sharing the same
common element of presumed perpetual growth. Everybody plans on growing
steadily, forever into the future, amen.
The United States is no different. It's own entitlement shortfalls, pegged
at anywhere from $60 trillion to $220 trillion, are themselves still derived
with the assumption of future growth.
Here’s the ‘plan’ for the US according to the CBO:
Yes, the ‘plan’ is for the US to someday have an economy equal to the
entire current world GDP as it stands here in 2015. Does that make any sense
to anybody at all? Who thinks that’s a realistic plan?
By 2080 when this is supposed to take place, the entire world will be past
the peak of all known sources of energy. And Phosphate. And soil. And fresh
water. And oceanic fish biomass. And who knows what else. And yet the CBO
blithely assumes that US, all on its own, will be producing and consuming 100%
of what the entire world does today.
The above chart helps us visualize one of the largest and most potentially
destructive forms of denial on display. Our collective denial of limits.
Ecological Denial
Sadly, it's on the natural fronts that human denial seems to be at its
most extreme. Hollywood visions and SciFi fantasies aside (where humans live
in sealed capsules and subsist entirely on man-made foods), humans are 100%
utterly dependent on the natural world for their survival. Food, water,
oxygen, and predictable temperatures and rainfall patterns provide the basics
of life.
To focus on just one part, which I also detail in The
Crash Course book, humans are rapidly degrading our soils upon which
everything depends.
Not only are we obviously losing topsoil to erosion and generally turning
soil into lifeless dirt by stripping out its biological diversity, we are
mining these soils for their micro and macro nutrients yet have no
coordinated plan for replacing them.
Obviously if you take minerals like calcium and magnesium out of the soils
in the form of harvested grains and vegetables, they'll need to be replaced.
Right now they are mainly flushed out to sea, never to be economically
recovered.
The situation is pretty grim as I recently outlined in a recent report on our nation's poor soil management
practices. Here’s some more context for that view:
Britain has only 100 harvests left in its farm soil as scientists
warn of growing 'agricultural crisis'
Oct 20, 2014
Intense over-farming means there are only 100 harvests left in the
soil of the UK’s countryside, a study has found.
With a growing population and the declining standard of British farmland,
scientists warned that we are on course for an “agricultural crisis”
unless dramatic action is taken.
Despite the traditional perception that there is a green and pleasant land
outside the grey, barren landscape of our cities, researchers from the
University of Sheffield found that on average urban plots of soil
were richer in nutrients than many farms.
“With a growing population to feed, and the nutrients in our soil
in sharp decline, we may soon see an agricultural crisis,” Professor
Dunnett said.
“Meanwhile we are also seeing a sharp decrease in bio-diversity in
the UK which has a disastrous knock-on effect on our wildlife Lack of
pollinators means reduction in food.
(Source)
Scientists in the UK are being matched by scientists elsewhere, noting
that humanity’s general approach towards soils and farming are obviously
destructive and exceptionally unsustainable. It should be setting off alarm
bells that urban plots are found to be more nutrient-dense than many farms.
The loss of biodiversity is something that we just cannot yet fully
comprehend, as all of nature is an enormously intertwined set of complex
relationships. Of course, our failure to understand and appreciate the true
role(s) of biodiversity will not protect us from the consequences of
destroying it.
Any culture that ruins its soils cannot claim any sort of sophistication
at all. That just flunks the basic IQ test. It’s not unlike watching a
brilliant piano prodigy starve to death because he can't manage the details
of making his own meals despite a well-stocked kitchen. No matter how
beautifully he can play, he simply lacks the necessary skills to sustain
himself.
Human security at risk as depletion of soil accelerates,
scientists warn
May 7, 2015
Steadily and alarmingly, humans have been depleting Earth's soil
resources faster than the nutrients can be replenished. If this
trajectory does not change, soil erosion, combined with the effects of
climate change, will present a huge risk to global food security over the
next century, warns a review paper authored by some of the top soil
scientists in the country.
The paper singles out farming, which accelerates erosion and
nutrient removal, as the primary game changer in soil health.
"Ever since humans developed agriculture, we've been transforming the
planet and throwing the soil's nutrient cycle out of balance," said the
paper's lead author, Ronald Amundson, a professor of environmental science,
policy and management at the University of California, Berkeley.
"Because the changes happen slowly, often taking two to three
generations to be noticed, people are not cognizant of the geological
transformation taking place."
(Source)
Notice the shifting baselines phenomenon happening here. Because the
changes have taken place over three generations, our culture is incapable of
recognizing the threat, let alone properly responding to it.
Instead of a bucolic pastime, farming has become just another mirror
reflecting our destructive ways. Rather than carefully working within natural
cycles, the average farming practice seeks to dominate and override nature.
Just spray and you’re done! Easy-peasy. Of course, this has the chance of
knocking out your birds and your bees as well as the butterflies and who
knows what other essential and beneficial insects as I recently laid out in
the report: Suicide
By Pesticide.
Pesticides kill the bugs we don’t want and many more besides. Herbicides
knock out weeds, but also lots of other life-forms we do need and want kept
alive. Fungicides knock out bad funguses and good ones alike.
This lazy approach to farming, although chemically sophisticated, lacks
any real connection to the cycles of nature the most obvious one being the
strip-mining of the macro and micro nutrients.
There was a reason that the herbivores roamed over the same grounds for
hundreds of thousands and even millions of years. That worked to keep
everything in balance and led to the creation of the thickest and healthiest
soils imaginable when the American West was first plowed not all that long
ago (by historical standards).
Horribly bleak study sees ‘empty landscape’ as large herbivores
vanish at startling rate
May 4, 2015
They never ateanybody — but now, some of planet Earth’s
innocentvegetarians face end times.Large herbivores — elephants, hippos, rhinos
and gorillas among them — are vanishing from the globe at a startling rate,
with some 60 percent threatened with extinction, a team of
scientists reports.
The situation is so dire, according toa new study, that it
threatens an “empty landscape” in some ecosystems “across much of the planet
Earth.”
The authors were clear: This is a big problem — and it’s a problem
with us, not them.
This slaughterand its consequences are not modest, the article said. In
fact, the rate of decline is such that “ever-larger swaths of the
world will soon lack many of the vital ecological services these animals
provide, resulting in enormous ecological and social costs.”
Herbivores, it turns out, don’t just idle about munching on
various green things. They play a vital role as “ecosystem engineers,”
the paper said — expanding grasslands for plant species, dispersing seeds in
manure, and, in the ultimate sacrifice, providing food for predators.
(Source)
It’s the last paragraph that’s essential to understand.
Nature is so subtle and complex, that we have only recently learned that wolves
shape rivers. Or perhaps the Native Americans knew that and it is our
‘modern’ culture that is only re-figuring all this out. I was confused by the
thought of wolves shaping rivers the first time I heard it too, but it’s all
laid out in this handy 4 minute video:
The loss of large herbivores will re-shape the landscape in ways that we
do not yet understand and therefore cannot appreciate. But they are certainly
‘ecosystem engineers’ and the loss of those services, to put it in
transactional terms that economists might relate to, will lead to a whole
host of as-yet-undefined changes some of which we will regret.
We're Not At The Tipping Point; We've Already Past It
The roles of eating, digesting and spreading seeds and manure seem like
things we can make do without, here at the apex of the petroleum age, but in
a few short decades we will understand just how much energy was necessary and
how much value was created by the actions of these herbivores.
In Part 2: Life Beyond The Tipping Point we look at the
looming net energy crisis is mathematically certain to place increasing
limits on the modern way of life, in our lifetime -- likely much sooner than
we want or are prepared for. In sum, despite the intent of world leaders to
blindly deny the economic, ecological and energetic cliffs we are hurdling towards,
society has already long past the point where painful ramifications can
be avoided. At this stage, destiny will be determined at the individual
level, depending on what steps each of takes now, before those ramifications
arrive in force.
Click here to read Part 2 of this report(free
executive summary, enrollment required for full access)
