I started this as a response to this post (hence the title), but eventually it grew so long that I figured I might as well turn it into a post of my own, so here we go. This is about your future. It is fairly relevant to you, if you’re younger than 50 and less relevant if you’re older, unless you plan to live another 50+ years. This is about the future covering a time span roughly equivalent to the rest of my life. (I plan to die in about 60 years or so). Now, where do we begin … let see:

The US became a net energy importer in 1972 and the planetary oil consumption/planetary population peaked in the late 1970s—meaning that population growth has been outrunning industrial growth for thirty years meaning less for everybody.

Since then we have essentially had a redistribution of wealth with the rich getting richer and the poor getting poorer but everybody getting poorer overall. Losing their source of energy and thus their manufacturing volume dominance, the US has chosen to focus their strategy on global military domination. It immediately follows that by being the dominating military power, their currency would also be strong and thus they would be able to act like the world’s banker (much like the Swiss strategy but on a larger scale). And being a banker pays very well. In summary this two-pronged strategy allows the US the extract tribute from the rest of the world; it happens by borrowing money, spending it on resources, and then inflating the currency the IOUs are denominated in, but that’s essentially what it is. The US is an empire like Great Britain and like Great Britain, it lives and dies with its ability to control its colonies and resist challengers. What we are seeing here is not the end of history but merely the latest in a succession of empires.

Perhaps an intermission is in order here with a few words on terrorism. Terrorism is nothing new. Every empire has it. The European [now former] colonial powers have had it for centuries and this is why they are much more accepting of its existence, whereas Americans have only enjoyed the experience since winning the cold war. Terrorism is not anymore evil than lung cancer is evil. It is is simply a consequence of smoking too many cigars. In that regard terrorism serves a purpose in that it is economically important because it makes colonial administration more expensive. It is politically important, because eventually the colonies will be given up. Both sides of this war knows this although this is not how they phrase it for their respective people.

However, what this means is that globalization will end. I do not think that they realize this.

That’s right! Globalization is essentially the result of economic imperial control rather than political imperial control. Functionally the difference is irrelevant. What is comes down to is essentially whether you have troops stationed within striking range of the country and whether resources are leaving that country in an off-parity trade e.g. (My IOUs for your stuff). It is also to some degree also based on cheap energy (2nd day air, anyone?)—and that era is over.

This means that in the long run, the rich countries will not be those will the largest populations but those with the largest or the best access to resources. That is, the most efficient access. In other words, who has the most resources relative to their population; these are the ones that will live the best. Here I’m talking inorganic resources as well as “live”-resources such as topsoil and water. Since global warming is moving the viable “live”-resources north, I think this makes a good case for staying out of the subtropics. Those areas are going into permanent decline (In 20 years, people will be speaking of the “Central Valley Dust Bowl” around here, if they’re still around). Countries above 45N and below 45S are going to fare better.

In the mid-game, the most important question is where the energy flows. Currently China and presumably India are making their own deals with the Middle East just like Japan and Germany did half a century a go. And just like then, those who already have “good” deals are trying to thwart them. Who controls the oil controls the world. The US is losing this game as a nation (but some people inside the nation is winning it — in fact, don’t think in terms of nations wrt to this .. think in terms of individuals … for instance, some individuals and families benefitted greatly from the latest invasion of the ME) because a factory in China has a more efficient use of a barrel of oil than a soccer mom driving down to the mall to have her puddle’s nails clipped—essentially, globalization is now backfiring.

The mid-game will entirely be determined by who secures which energy resources. Note that those resources will get progressively more costly to both buy and to keep others from buying. The question to ask here is: Who has the resource? Who has the carrier based strike force and the nuclear ICBM submarines—specifically, who can afford it; not in terms of money but in terms of productive capacity and trade (you can by definition not borrow your way to military supremacy/you can loot your way to it though). More importantly, who is currently building new ones? A submarine fleet or a carrier is not something you build on demand. You plan.

In the end-game (around 2050) we will be fighting environmental decay as well as each other. Planetary food insecurity will be at an all time high and we will have war refuges as well as environmental refuges. I think at that point, like now, many people in the rich part of the world will be oblivious to this (as they are now) and there will be technology even fancier than the ipod to keep them distracted (it will be noted that the rich part of the world at that time will likely be the same size if not smaller than it is now, that is, about a billion people out of a total of 9 billion). What this tech is not going to do is to save people—just like it’s failing now—because this is simply not profitable. It is and remains a political problem except at that point, the stakes will be even higher than they are now. At that point in time human life does not matter as much because human life has gotten even cheaper—thus even if you have a billion souls, the total value is small, if they can no longer get their hands on food and energy (and worse, water).

In my opinion the nations/areas most likely to “dominate” the latter half of the 21st century are those with the greatest social cohesion and the greatest cultural experience in declines combined with some food security and modicum of natural resources and technology—technology being something that exists in people’s brains, not something you pick up at the mall (in other words, where are the world’s scientists and engineers going to be living, currently they live in the US, but perhaps they won’t keep doing that.). In that regards having an older and more mature population even leads to a more mature decision making process for the entire country. You will probably not find a more civilized country on the planet than Japan. Conversely, go to a country with a young average age and you will not find much social cohesion; and on the whole it will be more volatile. If the resource availability is not longer growing it will no longer pay to be a growing/growth oriented country. Population growth will come to be anathema, because it is simply unaffordable — there are nowhere for the people to go except to war and the era when wars were won by superior numbers are over (since the introduction of the machine gun). In the future wars will be won, not by whoever can apply force more effectively (WWII), but who can apply force most efficiently (US weapons technology).

However, do not forget that a country can easily suffer internal disintegration due to environmental stress. In that regard, the question is … are you above 45 degrees north (and vice versa on the southern hemisphere) or better … 50 is better, 55 is really good. If not, you will have a problem feeding your population unless you find some expedient way of brining your population down either externally (war, lack of health care, hunger) or morally (procreation control in one way or another). Seeing that humans aren’t exactly far-thinking creatures, this will likely not happen and thus refuges will start moving towards the poles. This is the end-result of the tragedy of the commons once part of the commons get destroyed. Either you fight over the rest or the rest gets destroyed even faster.

You may see it differently, but this is how I see it. Sorry if I sound a little cynical, but I have long come to terms with the fact that few people in charge seems to listen (mainly because they would be voted out of office so fast that their heads would spin, like Jimmy Carter), that is to say, they do listen, but they are not going to tell you, the happy-go-lucky voter, anything, because that would be a conflict of interest in a representative democracy (it’s one instance of the principal-agent problem, look it up) because people essentially vote for politicians who tell them what they want to hear. Yes, they do!

What I can suggest is to move North (whenever you move, no hurry yet). Learn about growing food (this might just save your life or at least make it more decent, this is vital because top soil does not migrate; it has to be created in place, hence intensive gardening skills will come to dominate industrial farming). Learn to be frugal again—it’s better to learn it because you want to than because you need to, so start now. Accumulate real wealth like skills, connections/social cohesion, and resources. The best resources are tangible assets. I’m not thinking real estate, at least not in the McMansion sense or even the middle class housing sense, but perhaps part ownership in a productive entity you control. A forest, good soil, or a small company (presumably if you had a controlling share in a large company, you are rich enough not to worry about this). This is real wealth (unlike the paper networth people of this age are so bent on pursuing) and this, I believe, is what will “inherit” the Earth in terms of which cultures will survive.



Jacob comments:

Obviously this begets the question how realistic is this. It is in essence a gonglomeration of various sources I have read mainly based on sources with roots nature-nature and nature-technology thinking in contrast to sources based on social-social thinking which is typical for politics and economists which leave real world solutions to “Them” and only consider themselves with the distribution of the wealth that is created by others. What is worrying here is that the “Them” they rely on to provide the invisible hand and the substitutions are exactly the one’s warning about the problems.

There are several predictive models. The first real model was the world3 model associated with limits to growth (today there are more advanced models like the M.I.T. model). Anyway, the world3 model, contrary to popular myth, is actually quite on the button in terms of its predictions, now 35 years later.
Read this: http://www.csiro.au/files/files/plje.pdf for a comparison… [If you don’t want to read through it (that whole, I got more important things to worry about right now thing that keeps everything locked in the status quo) just go to the end and look at the pictures. The “standard run” mentioned in the paper is the “let’s just wait for further data while we debate and do nothing and continue business as usual”-scenario.

Some of these things are happening now, like the beginning of the mid-game with the battle for resources between the old colonial forces (the US) and the up and coming (mainly China).

In retrospect we will likely be confirming peak oil as having happened in the first decade of this century (*see update below*)—maybe widely acknowledged next time oil hits $150, which will happen once we get out of this recession, it will continue to cause boom and bust pricing as it peaks going higher and higher each time.

The first warnings of the south western dust bowl are currently being seen (even in the news, I am very pleased that the US administration publicly acknowledges the pending problems for states like TX, AZ, NM, and SoCA). You saw what happened in Australia—it will happen here next. The Central Valley is not long term viable as a major food production center.

Obviously it is very difficult to see trends that develop over a period of decades because it’s not “in your face” or because events seem unconnected (Katrina was caused by … ? … well it’s widely believed to be a freak accident and caused by failing levies … what is not seen is that the statistical rate has simply gone up. It will likely take a handful of such hurricanes impacting major US coastal cities (I wouldn’t want to move to any of them) on the Atlantic coast for those not used to thinking in statistical terms to finally get it) and people get used to things e.g. we may have new record temperatures around here every year but it’s still cooler than Arizona. This is also still seen as a “weather”-problem rather than a “climate”-problem. It not the weather that is getting hotter. It’s the climate that is changing and becoming more sub-tropic as the sub-tropics (essentially the big bands of brown land on the planet) are expanding. We are simply beginning to have the weather than used to be hundreds of miles south of us. In several decades, we’ll have the weather than used to be a thousand miles south of us.
The big problem arrives once the domains that are “still cooler” are no longer livable… kinda like a border moving back at us. Like the Florida Keys which will to a large extent be swallowed by the sea over the next 100 years.

Now, in terms of doomsday scenarios, on an individual scale, this is probably going to be as “exciting” (no more, no less) as the 20th century with two world wars, the cold way, the first man on the moon. Our challenges will just be different. We will not worry so much about global wars but rather about global epidemics. We will not worry about capitalism and communism. We will worry about humans and nature. On top of oil shortages (which will happen more often) we will also worry about food shortages, etc. I still think most people can remain mostly ignorant (“You speak Dutch in Denmark, right?”) about the big picture while having the little picture changing under their feet either abruptly through disasters or slowly simply due to higher costs e.g. a changing general expectation that people just don’t live as long as they once used to (dying of the funny-flu at age 60 would become more normal).

Also, it should not be forgotten that even today, individual circumstances vary far more than what can be attributed to secular, that is, slow moving macro-trends. The well-off in the 21st century will still enjoy a higher standard of living compared to the globally poor or even middle class of the 20th century. Don’t forget that if you’re reading this, chances are high, that you standard of living is higher than 95% of the other 6.5 billion people (when I was born, there were only 4 billion people on the planet) of the planet. The only thing is that those that remember more than a few decades back would tend to remember that they used to be able to do things (like leave their doors unlocked, live well on a single income, or go to the moon) that they no longer can. But instead they can always down 50 million songs to their iphones or have future American Idols piped directly into their brain stems.

**2011 Update**: The International Energy Agency which had previously maintained a business as usual stance that future oil demand would be met with with human ingenuity has now done a complete 180 and confirmed that global oil peak production occurred in 2006.