The economy is going to change basis from petroleum to…something else. The question is whether that basis is post-petroleum…or pre-historic.
There may well be no in-between.
See below the fold for more. 🙂
Diversification of Energy
Diversify the energy supply portfolio of our civilization. We can and should improve capacitor technologies to accumulate near-continuous, low- and/or variable-density energy sources such as winds, tides and sunlight. With primary energy sources becoming the mainstay rather than the marginal source of power, gradually the burning of fossil fuels, charcoal, and dung will fade, as economies of scale for wind, wave and sun will emerge.
- Petroleum and natural gas will remain dominant, so long as interested private and political actors can crowd out investment that might accrue to the development of currently-marginal energy sources, and legislate research and innovation out of existence.
- With no research and innovation, there is no informed dissent, only discomfort with rising oil and gas prices. In other words, the status quo.
- Breaking through the barriers, researching, experimenting, inventing and informing anyway is mission #1. Waiting for Government, God or Godot to come to the rescue is a proven waste of time. Godot helps those who help themselves in this matter.
- Few have the combination of talent, temperament and training to build a micro-scale alternative energy economy from scratch. We wish them well, but what can we do to make their lives easier?
- Lots. Most people possess the sentiment, sense and sanity to be capable of using less electricity at home, recycling more and driving less for less frivolous reasons. And ironically, the lower demand is for energy, the more margin exists to reinvest in developing alternative energy. Plus conservation adds to the household and business bottom line. There’s no excuse for wasting juice.
- With that increased margin, instead of having a Second Coming of the SUV, we sink those savings into investment, both personal and public, into incentives (tax breaks, perhaps) for the development and purchase of hybrid vehicles, which are still partly fossilized, but we’re just looking to diversify our energy portfolio in this half of the century, to buy ourselves the time to save ourselves. And that’s going to be hard enough all by itself.
- Build, promote and participate in social and cultural support structures, to fortify yourself with conservation information, new ways to save yourself, your family, your friends and your grateful boss and shareholders more money (and gain mojo for yourself!). They exist in abundance now; find what works for you and if nothing quite fits your ethos, lifestyle and sociological milieu, make something up.
- The big thing to develop a personal culture of props for conservation, snaps for wastrels and spendthrifts. I mean, that mofo in the SUV is sucking your planet dry. Get upset about it, then high-five with your peeps afterwards about sticking it to the Man, through sticking it to one of his minions.
9. And that’s the point of it: Self-preservation, not just money in your pocket, but a planet for your children. If that doesn’t get you fired up, perhaps this isn’t your fight, but we’ll razz you less if you drive a fuel-efficient vehicle, at least.
10. Bringing it all together: Less consumption means less profits for an entrenched cartel that uses its profits for conserving its prerogatives, not your planet. Fewer profits means a looser hold on investment capital and on the putative servants of the people in government. More innovation in alternative energy happens. More incentivization (or at least less suppression) of scientific research and initiative in energy projects happens. The inventors flourish. The conserving public profits from saving, from cartel-busting, from new products, and the virtuous wheel rolls on and on and on.
11. To combat and marginalize cultural rescidivism, even outright atavism such as the SUV phenomenon, promote a culture of support for saving, shame for wasting starting with your own household, then sharing the props and snaps, respectively, farther and farther afield as your networking and support builds.
12. And none of this is that original, or that untested, or that far from the mainstream. Quite the contrary: Guzzling gas isn’t cool anymore. People who do so are defensive about it, as well they should be; they single-handedly tanked the Nineties recovery out of existence. (That’s right: There was never a ‘bubble’, there was cheap energy, then the SUVs sucked that well dry, then there wasn’t) And there’s no reason not to turn up the heat, on people who never turn the heat down.
Dispersion of Capital
Miniaturization a go-go. Devolution a go-go. Leverage skilled labor a go-go. Reduce capital inputs per output of product, disperse capital to the small shops and tool shed workbenches of the world, as much as possible. This is practicable by reducing the size and complexity and cost to manufacture, use and maintain tools and machines used in the production of goods and services. We don’t need nanotech. All we need in the next decade or so – and have time for – is mini-tech. And anything that can empower the weekend hobbyist can make a factory that much more energy-efficient and competitive.
1. There is no shortage of basic science – and basic patents – that have yet to be fully developed. And since in our era there is a close correlation between concentration of funds and concentration of intellectual property, let’s explore this thread together in more detail.
2. One concern of mine is the concentration of ownership of intellectual property rights, and working to make licensing for smaller operators easier to obtain on existing patents, and secure some share of the profits of innovation for subsequent innovations, which seems only fair.
3. If a structure for sharing/leasing basic patents to small developers can be made affordable to both the patent-lessor and lessee, or if these mechanizations exist already – making knowledge of them widely available, perhaps the cost-benefit calculus of outright theft of intellectual property will diminish, as well. Sort of like selling download rights to music for pennies, instead of Draconian laws against pre-teens using peer-to-peer networks.
4. Apply this to energy, hi-tech, biological patents, provide a means for sharing the benefits of patenting gene codons and nonorganic molecules more easily and widely, then perhaps objections to corporations ‘owning’ such things will subside somewhat. That alone might be valuable political and economic leverage. Remember, we’re going for more dispersion of capital, not neocommunism. Save that battle for the 22nd century.
5. The calculus for this reform is thus: Corporations are starving for new ideas, and anxious to fully exploit the economic value of the ideas they already have under patent, but equally anxious to diversify the risks of same. Now, the core product supporting a given patent they know; after all, that’s why they got into the game in the first place, and it’s theirs.
6. However, every invention has an after-market, basic patents have tons of second-generation potential. But which ideas to go for? Why not all of them? Three reasons: cash, risk and time. Cash, because it’s a finite world with finite resources. Risk, because any new move has a downside as well as an upside, as well as an opportunity cost. Sure, people liked disco. For a while. But they liked not wearing polyester even more.
7. So what you do is you spread out the risk by leasing to qualified, trustworthy business partners, perhaps fronting some seed capital, too, in return for a share of possible returns. The innovator brings time, talent and ideas of his/her own.
8. We mentioned time being scarce to companies, as well. This has another implication: patents and the products based on them obsolesce (See: Disco), then a competing product or process kicks all the erstwhile winners to the curb.
9. Structurally, this jacks up prices on all goods and services by a certain margin, the more idea-intensive the industry, the worse the markup, because firms that incur all the costs of research, time and risk have to get their money back. Distrust is expensive, for both the producer and the consumer. And in the large economy-sized pill bottle that I’ve not mentioning by name so far – pharmaceuticals – there is the countdown until the patent runs out.
10. It is precisely such companies and industries that could profit the most from lightening up.
11. For example, aspirin is the most generic, most generically-useful drug we know of. We do not even know if we’ve found all of its uses so far. Somewhere out there is something better than willow bark as a source of medicine, but we’ve yet to find it. Who has time, who can afford the risk, when ‘everybody’ knows the real money is in protein synthesis, and gene therapy, and stem cell research?
12. Well, that’s just it: A few big super-drug companies cannot. But perhaps some independent researchers can. If they find nothing, no loss. If they find something, woo-hoo!
13. And my guess is that a lot of very excellent pharmacopeia, using far simpler technologies than those used to create proteins from scratch, can be pulled literally straight from the vine. And there’s no reason for hoarding the capital, both intellectual and otherwise, to keep such goods from being developed.
14. Now, some companies aren’t going to like this; they LIKE business as usual.
15. But I assure you, the first major drug company to get onboard this notion will out-cycle and out-produce every one of its competitors combined, because it will be profiting from a piece – not all, just a percentage – of the works of hundreds, if not thousands, of smaller relationships.
16. Now, we’re not talking kieretsu arrangements, here. All the contracts are temporary, and talent can move about, though one cannot rule out Japanese-style corporate federalism from arising.
17. Again, the idea is to get ideas moving down the pipeline, in devolved ways.
18. Oh, forgot the most important thing of all: This is a superlative way to develop all those Earth-shaping inventions that died on restaurant napkins, for want of capital and support to develop same. Got about a few of these, myself. One’s for a helion (heavy ion) rocket propulsion system. Any takers?
Energy-Based Currency
Make the currency based not on speculation or precious metal stockpiles or good faith and credit, but on the kilowatt-hour. Make the dollar energy-based. In a sense, it already is. Make this explicitly so, such that a country that spends more than it saves in energy terms will see its currency depreciate, the opposite for thrifty societies. This might require the cooperation of several major currency countries, and a mechanics of crediting savings as well as debiting consumption would have to be in place, else not one of the major economic powers would play along since almost all are net energy debtors. The short-run advantage would fall to net energy producers, but in the long run the depletion of extractable stocks and the incremental appreciation of `energy capital reinvestment’ would give a significant advantage to the most technologically progressive countries; the worst-hit would be net energy debtors that made no attempts to invest in the new mode; not only would such countries’ productivity falter, their currency would crash, as well.
1. Materials + Knowledge + Energy + Time = Tangible Value. Well. That’s one simplistic model, anyway. And it’s about to get better: It takes time and energy to obtain materials and knowledge, so the formula can be rendered even more abstract:
2. Energy + Time = Value. Replace Energy with Exertion if you’re feeling that Labor is being shortchanged (again! Let’s burn something a lot!).
3. The equation is interchangeable. Spend significant value and energy, and you can buy time – time to think, to breathe, to obtain other resources, to pay the loan, to invent the techno-fix that will save us all, or just hang out and be cool. Or Time + Value can be spent to obtain energy. The gas in your automobile, for example. Or someone paying you Value in return for your Time and Energy. Or Labor, if you’re feeling that urge to burn rising up again, sensing disrespect for the working class. Please don’t. This is just a diary, and this is just blogging.
4. None of the basic canon of financial mathematics or economics need be thwarted or rendered moot; we’re just cutting to the chase, here, given that as the Holy Trinity of Economics (Stirling, Bonddad and Jerome) have each weighed in that energy (oil) is the critical scarcity of our age, we’re just refining the focus.
5. Let’s look at the now: The cosmos itself is a case study of energy going from one form to another, with some function of wastage, with accompanying transformation of physical properties of the course of some period of time, and gradual alteration of the coefficients of the equation – you know, how much of x is required to purchase y and how long t it takes to get it and how much ‘tax’ or wastage z is involved, and what by-products (some good) a,b,c…n are generated.
6. There is not one thing in the human economic experience that precludes, obviates, adds or detracts from this short description, save what meaning we choose to apply to the world, using this equation.
7. Now, if Energy is a function of Time and Value – of how much of a hurry we are in order to get ‘stuff’ – goods and services, and we are ever in more of a hurry to get more ‘stuff’, or more customers, or more of both, well, that’s going to require more energy.
8. At the moment there are 6.5 billion people going on 13 billion by the most optimistic projections. I would counter that with my own estimate: 9.5 billion, then crash! Dieback. The fallacy of population projections is that the End of Growth will be attained in a smooth gliding approach to homeostasis. So sorry. That is so not going to happen. Nothing in the history of distressed populations anywhere in history suggests anything of the sort. It is only in those countries with sufficient Value and Energy that the Time to make the smooth landing has happened.
9. Ask yourself: Are there enough basic essentials to go around? Enough food, water, medicine, diapers? Is there enough gasoline to get all those needful things to the needy people in time, for a price that either they or someone on their behalf can afford? Now ask: What if you add another three billion babies to the mix? Whatever uncomfortable and affirmative response you might have offered for a world with 6.5 billion mouths to feed just feel off the table. Oops.
10. I submit that our top priority right now is avoiding a Dieback, which could come in many forms and might well arrive as a cascade of deadly crises: thirst, plague, famine, war, crime, death by a thousand cuts, in rapid succession. What we need to do so is Time: time enough to save a world.
11. And we need to pay for that time in Value and Energy. Value that we must create by generating a renaissance in creativity, through the devolution of capital, and Energy that we must create – or save, which is one and the same with creating – to spend exerting ourselves to the task of gaining a good steady glide path for the smooth landing that saving the Earth — from us – requires.
12. Some might say: just pull the plug on the consumer economy. It’s too late for that, that and wealth equals options equals increased life expectancies, deferred onset of childrearing, greater spacing of subsequent children, equals lower fertility rates and that’s good. It’s also a nonexistent condition in poor, low life expectancy countries, absent the presence of potentially species-ending diseases like HIV. And we’re in the business of fighting the Dieback, not aiding and abetting the end of Humankind.
13. Some might say: plug the plug on energy, then. So sorry. Energy is what we require: to get the goods to the people who require them. Technological civilization heralded the onset of this crisis, but it did not cause it – overpopulation did, that and delaying in the attainment of sufficient standards of living to the people of the world to reign in high fertility rates (via the explanation above). Rich people, in all lands, in all times, have fewer kids than their poorer brethren.
14. You want population control? Smother the planet in consumer goods, give them excellent educations so they know their options and the consequences of making bad choices, give them the freedom to find their own way. In every country where all three exist, populations are braking toward zero or negative growth. There is a causation to this; it’s not some sort of genetic senescence of nations. That’s just crazy talk. It’s a change of expectations and norms in response to having options and the knowledge how to exercise them.
15. And that about does it for today.
Wrap
Right now, we are collectively dying under the weight of too many people with too many wants, wanting solutions that other people have to develop, and other people must pay for, sometimes with their lives, and the lives and hopes and dreams of every child they will ever have.
And that’s just not cool.
