Gregor: Excellent article. I don't think the US will invest in public transport, that would take too much thought.
The stick approach might work. That is, I think, what works in Europe, high gasoline taxes, suppresses individual fossil foolishness and provides a market for public transit. But again anyone advocating higher taxes would be bombed like Baghdad.
gregor.us
· 5 months ago
US ridership on public transport soared in 2008. Cities and states are begging Washington for money to finish projects already underway, or, to simply have the money to go ahead with subsequent stages. The original StimPak was designed with a few fatal clauses. One was that the money could not go to existing projects. Even so, so little of the original StimPak was for public transport, it's moot.
I need to read Confederacy of Dunces.
ericgarland
· 5 months ago
I think you are so right to view California as the harbinger of what is to come. The simple, undeniable fact is that the U.S. economy will no longer be judged on its ability to inflate itself like it was bitten by some poison toad. It's got to work for people, live within its means, cease to measure its worth by its ability to spread suburbia across this gorgeous continent like a metastatic cancer.
Will this be a shock? Sure. Will this be a tragedy? Only if we make it one. We have many other productive, humane, culturally-beautiful options. And we also have a number of control-addicted, vicious, destructive options.
Now, it is up to us to choose. Our politicians won't do so, for reasons of ideology and campaign finance. It is up to us as a people. I wonder what we will decide.
gregor.us
· 5 months ago
Our politicians are also very much post-war paradigm thinkers. They are still operating within a framework of discretion. They think "Well, we can do this, or we can do that." They don't consider the other possibility: "We have no choice but to do X."
ericgarland
· 5 months ago
I actually feel sorry for some of the "leaders" I meet who look like frightened rabbits in a burning forest. There's real change going on, "creative destruction" if you like to wax Schumpeterian, and these guys feel obligated to be stiff-lipped white guys barking "I know what's going on...everything is UNDER CONTROL." And well, NO IT ISN'T, and that's OK. Nobody's in control of the old system, which just isn't going to work any more. It's like there are still guys running around trying to corner the horse feed market so they can own a chunk of the transportation sector. Sorry dude...nice idea, but that's not how it runs any more.
Hopefully, we'll hit enough EPIC FAILS that the leaders realize they don't need to appear to be in control, and then we can get back to the business of creating what works.
BMR789
· 5 months ago
Where does the aeronautical industry sit as a driver of post World War II growth sit for California? @BMR789
gregor.us
· 5 months ago
Aerospace was huge in post-war CA. I mention that more fully in my newsletter. It's a whole 'nother piece to the problem. Indeed,
ericgarland
· 5 months ago
I tend to follow John Ralston Saul in his brilliant book "Voltaire's Bastards" in which he argues that all defense spending is fake GDP. He has two points: First, that the "products" are unusable by society, bullets and helicopters not really being a marketable good. Second, that all "excess" production goes directly into arming the rest of the world, which often results in more foreign military intervention, and thus requires the "industry" to arm up our 19 year olds and send them to send foreign countries. This in turn requires an increase in sales to replace to depleted stocks of bullets and rocket launchers. So we then arm countries with more sophisticated stuff, but saving the best for our 19 year olds, whom we eventually send back into the fray. Wash, rinse, repeat: Latin America, Iraq, Afghanistan, etc.
John Ralston Saul's argument is that while the whole enterprise makes money for the employees of the defense companies, it's not really a GDP you can measure and aspire to in terms of quality of life. And if California is attached to that type of GDP while we become fiscally incapable of repeating our role as the worlds arms dealer-policeman... a whole-lotta shakin' will be going on.
Cindy6
· 5 months ago
One must point out that Britain's post war decline was relative, while the US decline is likely to be absolute. Living standard of the British people actually rose in the time period.
Adaptation like you suggested, while makes perfect sense, will be impossible. The US is set up on the assumptions of abundance of resources and shortage of labor. And these 2 parameters stretched way back than WWII, to even colonial period. (Slavery was not due the southerns being more evil than others) They define not only its economy but all other aspects of society as well. Now that these 2 assumptions no longer hold, the US is having the rug pulled from under it.
gregor.us
· 5 months ago
Thanks for the perspective. I assume you mean that the British standard of living post-war declined only relative to other OECD/EU/US? If that's what you mean, yes, I am aware of the viewpoint. As an aside, as someone who lived in the UK, I often found myself asking: "Just exactly what portion of British society actually enjoyed a high standard of living between 1900 and 2000?" Socially, pre and post war Britain are perhaps two different eras. So that too complicates the equation.
G
EricCB
· 5 months ago
I'm wondering if we see your 50 cent per gallon gas price due to all those tankers sitting out there and being used for storage. I hear there are 67 of them each holding 2 million barrels. I realize in some respecs thats not much, but maybe on the margin prices will drop at the pump and keep the current system alive another 18 months or so. The other thought about that floating crude is that maybe somebody or somebodies know that the flow of oil will soon be curbed due to political or military action in Iran or else where. Gregor, your always a good read.
gregor.us
· 5 months ago
One method to capture 50 cent liquid fuel right now would be to use a CNG vehicle (compressed natural gas.). CNG car owners must feel, with NG prices so low, that they are nearly driving for free.
G
BMR789
· 5 months ago
Have experience with a CNG vehicle.
In the early 1980's following the 1979 oil shock - NZ embarked on a CNG scheme rollout - filliting stations etc, and subsidies to convert cars to run as duel fuel vehicles on CNG and petrol. My mother had her Ford Escort 1300 set up to run on CNG. It was the car I learnt to drive in - well officially that's the story.
Whilst acceleration would be better described as "Gaining momentum' - there was nothing too much wrong with it to trundle about in. It took a little bit longer timewise to fill perhaps, and the distance able to travel was possibly not quite as far as a tank of gas - but still at least 300km. Importantly for a learner driver it was cheap to fill
Most of the 1980's it was possible to run a car on CNG in NZ, but then the crisis passed and the CNG installs dropped off, the refill stations which were expensive to operate were slowly pulled out, as the number of cars were churned out - or people stopped using CNG as the price of gas declined relative to earnings.
There are still plenty of LPG powered cars in NZ - mainly Taxi's and fleet operated vehicles. Tend to be larger 6 cylinder type cars.
JJ
· 5 months ago
"To make matters worse, the federal government is in the midst of one of the largest policy mistakes in US history as it has chosen to make enormous new investments in car companies, cars, biofuels, roads, and highways to the exclusion of public transport."
That "policy mistake" started right after WWII and is merely coming to its crashing end.
We built a country, infrastructure, and economy that requires 20 dollar a barrel oil, and all the cheap, easy to pump oil is gone. Mexico will cease to export in 2 years, Iran in 2014, all major exporters cease exporting in 10 to 20 years. The US is going to have to cut its oil imports drastically in say 5 years, which does not give us a lot of time.
We should have started doing the energy efficiency improvements in the late 70s like Carter said, but we just could not be bothered. So the majority chose to live in a fantasist Morning in America that actually turned out to be the evening.
agathocles
· 5 months ago
Dear Gregor,
I respectfully disagree with the following conclusions:
"[I]t’s hard to see how California–and the US by extension–does not become a permanently smaller economy."
"An interesting exercise when looking at previously collapsed economies and societies is to ask when a certain, initial terminus was reached, before the overshoot phase began...It now seems likely the United States reached this point in the year 2000. That’s when the ability to grow the economy, without a large acceleration in debt, appears to have crossed a threshold."
We had a similar problem in the early-to-mid 1970s in the US. Productivity declined as the go-go years of the 1960s electronics and semiconductor industries fell into a slump, the government was priming the pump in Johnson/Nixon's War on Poverty initiatives, and the Vietnam War was draining our coffers. The Federal Reserve didn't have the political will, backing, or independence to place their foot on the credit and money supply growth.
Did all this necessarily cause a permanent long-term decline in the US? No - times were hard for many in the 1970s due to stagflation, but this didn't really affect long-term growth.
It's hard for me to see a long-term, absolute decline in the US economy. More likely, I think, is a short-term absolute decline followed by a long-term, relative decline *as a share of* the global economy. Is that what you mean, or do you really mean a permanent, absolute decline?
Cheers, agathocles
BMR789
· 5 months ago
Permanent absolute decline based on the failure of energy inputs to maintain existing lifestyle and expectations.
I would suggest this is what Gregor means - based on other posts.
It's somewhat difficult for people to swallow, when all we have known is cheap abundant energy always on tap.
I believe that there are substantial deposits of NG in the US; enough for quite awhile. Considering that you can convert autos to it, it's amazing that no serious push by the government has occured. What am I missing??
hbobrien
· 5 months ago
"To use a phrase that was once somewhat unfairly said about California by Gertrude Stein, we have discovered that there was no there, there in the US economy."
Well, your image appears to be correct, but only inadvertantly.
Miss Stein wasn't speaking about all of California. She was speaking specifically about Oakland, where she lived as a child between ages 4 and 18.
Even more specifically, she was speaking about Oakland on a return visit as an adult, and the place had changed so much from when she grew up there it was almost unrecognizable. The comment wasn't a slam; it was more in the spirit of Thomas Wolfe's, "You can't go home again."
kells1001
· 5 months ago
There is definitely a trend that is just beginning, which will downsize housing, concentrate populations and permanently change the American landscape unless new strategies to coordinate communication, mass transit and cheaper housing are not addressed more proactively. This does not mean Americans will not adapt and prosper, but instead will buy fewer cars, move closer to population centers and build and maintain smaller homes. Many more Americans will most likely live or even immigrate abroad.
All Comments
The stick approach might work. That is, I think, what works in Europe, high gasoline taxes, suppresses individual fossil foolishness and provides a market for public transit. But again anyone advocating higher taxes would be bombed like Baghdad.
I need to read Confederacy of Dunces.
Will this be a shock? Sure. Will this be a tragedy? Only if we make it one. We have many other productive, humane, culturally-beautiful options. And we also have a number of control-addicted, vicious, destructive options.
Now, it is up to us to choose. Our politicians won't do so, for reasons of ideology and campaign finance. It is up to us as a people. I wonder what we will decide.
Hopefully, we'll hit enough EPIC FAILS that the leaders realize they don't need to appear to be in control, and then we can get back to the business of creating what works.
@BMR789
John Ralston Saul's argument is that while the whole enterprise makes money for the employees of the defense companies, it's not really a GDP you can measure and aspire to in terms of quality of life. And if California is attached to that type of GDP while we become fiscally incapable of repeating our role as the worlds arms dealer-policeman... a whole-lotta shakin' will be going on.
Adaptation like you suggested, while makes perfect sense, will be impossible. The US is set up on the assumptions of abundance of resources and shortage of labor. And these 2 parameters stretched way back than WWII, to even colonial period. (Slavery was not due the southerns being more evil than others) They define not only its economy but all other aspects of society as well. Now that these 2 assumptions no longer hold, the US is having the rug pulled from under it.
G
G
In the early 1980's following the 1979 oil shock - NZ embarked on a CNG scheme rollout - filliting stations etc, and subsidies to convert cars to run as duel fuel vehicles on CNG and petrol.
My mother had her Ford Escort 1300 set up to run on CNG. It was the car I learnt to drive in - well officially that's the story.
Whilst acceleration would be better described as "Gaining momentum' - there was nothing too much wrong with it to trundle about in. It took a little bit longer timewise to fill perhaps, and the distance able to travel was possibly not quite as far as a tank of gas - but still at least 300km. Importantly for a learner driver it was cheap to fill
Most of the 1980's it was possible to run a car on CNG in NZ, but then the crisis passed and the CNG installs dropped off, the refill stations which were expensive to operate were slowly pulled out, as the number of cars were churned out - or people stopped using CNG as the price of gas declined relative to earnings.
There are still plenty of LPG powered cars in NZ - mainly Taxi's and fleet operated vehicles. Tend to be larger 6 cylinder type cars.
That "policy mistake" started right after WWII and is merely coming to its crashing end.
We built a country, infrastructure, and economy that requires 20 dollar a barrel oil, and all the cheap, easy to pump oil is gone. Mexico will cease to export in 2 years, Iran in 2014, all major exporters cease exporting in 10 to 20 years. The US is going to have to cut its oil imports drastically in say 5 years, which does not give us a lot of time.
We should have started doing the energy efficiency improvements in the late 70s like Carter said, but we just could not be bothered. So the majority chose to live in a fantasist Morning in America that actually turned out to be the evening.
I respectfully disagree with the following conclusions:
"[I]t’s hard to see how California–and the US by extension–does not become a permanently smaller economy."
"An interesting exercise when looking at previously collapsed economies and societies is to ask when a certain, initial terminus was reached, before the overshoot phase began...It now seems likely the United States reached this point in the year 2000. That’s when the ability to grow the economy, without a large acceleration in debt, appears to have crossed a threshold."
We had a similar problem in the early-to-mid 1970s in the US. Productivity declined as the go-go years of the 1960s electronics and semiconductor industries fell into a slump, the government was priming the pump in Johnson/Nixon's War on Poverty initiatives, and the Vietnam War was draining our coffers. The Federal Reserve didn't have the political will, backing, or independence to place their foot on the credit and money supply growth.
Did all this necessarily cause a permanent long-term decline in the US? No - times were hard for many in the 1970s due to stagflation, but this didn't really affect long-term growth.
It's hard for me to see a long-term, absolute decline in the US economy. More likely, I think, is a short-term absolute decline followed by a long-term, relative decline *as a share of* the global economy. Is that what you mean, or do you really mean a permanent, absolute decline?
Cheers,
agathocles
I would suggest this is what Gregor means - based on other posts.
It's somewhat difficult for people to swallow, when all we have known is cheap abundant energy always on tap.
http://www.theautochannel.com/news/2009/04/06/4...
I believe that there are substantial deposits of NG in the US; enough for quite awhile. Considering that you can convert autos to it, it's amazing that no serious push by the government has occured. What am I missing??
Well, your image appears to be correct, but only inadvertantly.
Miss Stein wasn't speaking about all of California. She was speaking specifically about Oakland, where she lived as a child between ages 4 and 18.
Even more specifically, she was speaking about Oakland on a return visit as an adult, and the place had changed so much from when she grew up there it was almost unrecognizable. The comment wasn't a slam; it was more in the spirit of Thomas Wolfe's, "You can't go home again."