Tuesday , November 30 2021
Home / In Brief / In Brief: depression overload, mitigation (2), more safety traded for peace of mind, nationalisation in all but name

In Brief: depression overload, mitigation (2), more safety traded for peace of mind, nationalisation in all but name

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Untreatable depression

Mental health has been a tacitly accepted casualty of the pandemic restrictions and lockdowns.  In addition to the anxiety in response to the virus itself, the threat to people’s livelihoods and the prolonged periods of social isolation – including the “social distancing” in previously intimate gatherings – have all taken their toll.  So much so that, in addition to the one in seven of us currently taking antidepressant drugs, there is a growing concern that tens of thousands more are struggling with undiagnosed depression.

These fears have opened up an age-old debate about how best to respond to people affected by common mental illnesses like depression, which historically went undiagnosed in part due to the stigma around mental illness, and in part because no realistic treatment was on offer unless and until the depression became so severe that drugs and electroconvulsive therapy could be administered. 

This all changed in the late 1980s with the development of the first selective serotonin reuptake inhibitor – SSRI – drugs.  Not because these drugs were any more effective than the older – tricyclic – antidepressants, but because they were far less toxic even in high overdoses.  This meant that where, previously, antidepressants had been administered under close supervision of psychiatrists, the new SSRIs could be prescribed by general practitioners.

As is the wont of Big Pharma, companies like Eli Lilly – Prozac – and GlaxoSmithKline – Seroxat – began to throw money at general practice and at the various mental health charities to “raise awareness” of depression, and to encourage people to seek early – SSRI – treatment.  The money had a degree of positive impact – the UK “Defeat Depression Campaign” in the 1990s undoubtedly raised awareness of depression and probably saved the lives of people who might otherwise have gone untreated and would have been extremely vulnerable to suicide.  Big Pharma though, was the main winner, benefiting from mass use of drugs over which they still enjoyed a monopoly.  Patients, on the other hand, were often given their monthly prescription and then left to their own devices.

Just a few years later, the Seroxat scandal broke.  For antidepressant users in general, SSRIs came with some nasty side-effects and often severe withdrawal symptoms when treatment came to an end.  For young people in particular, there was also a link to suicide and self-harm.  But although the regulators withdrew Seroxat as a frontline treatment, they continued to recommend other SSRIs, with Prozac being the drug of choice for young people.

A re-examination of the data around antidepressants in the wake of the Seroxat scandal resulted in a more nuanced approach to the treatment and management of depression.  While antidepressants are generally effective in the more severe cases, it turns out that they are far less so in mild-moderate depression.  Indeed, many clinicians have argued that the minor benefits in mild depression are solely the result of the placebo effect.

The trouble is that antidepressants – particularly now that the patents have expired – are cheap to administer and do not tie up doctors’ time.  Once depression is diagnosed, the GP can simply print off a prescription and the consultation can be brought to an end.  All within the allotted five minutes.  And even if all the patient is getting is a placebo hit… well that’s better than nothing.  And who knows, the patient may just get better on his or her own.

For those with more enduring depression though, simply waiting around in the hope that an improvement will occur spontaneously was not a favoured option.  And in the early 2000s, patients groups began to team up with an emerging counselling and psychology industry to promote so-called “talking treatments” which were often more effective in treating mild-moderate depression than antidepressant drugs.

The drawback with talking therapies though, was the cost.  Qualified clinical psychologists don’t come cheap, and most schools of psychology are open-ended – a course of treatment lasts for as long as it takes for the patient to get better.  Inevitably then, the NHS opted for two talking approaches – counselling and Cognitive Behavioural Therapy (CBT) – as these could be timebound.  Indeed, CBT was thought to be something of a magic bullet since its founder – the recently deceased Aaron T Beck – had designed it as a means of teaching depressed and anxious patients to become their own therapists.  For a while, the NHS offered remote CBT – by phone or via computer – with mixed results.

The problem though – one which goes back decades – is that psychological therapies were part of the specialist mental health services and could only be accessed via a referral to a mental health team.  And since there have never been enough specialists to go around, people with depression have generally found themselves on a roundabout on which their depression is consider too serious to be treated in general practice but not serious enough to qualify for specialist services like CBT.  And in the aftermath of the pandemic restrictions, there are so many people affected by depression that they could, on their own, use up all of the funding available to the NHS.

Calls for more talking therapies are no doubt well-meaning, but the sad truth is that any additional funding – at a time when the NHS is being overwhelmed by people with late-diagnosed heart disease, diabetes and cancers – will barely scratch the surface of the depression that has been building up throughout the pandemic.

Climate mitigation

So long as climate change was way off in the future, we had no incentive to do much more than virtue signal and pretend that the only problem was raising awareness.  But as global weirding gathers pace, and the costs of inevitably doomed attempts to reach net zero begin to crush household’s discretionary spending, actions that we might have taken over the last five decades, while still theoretically possible, will prove to be beyond us.

Switching to supposedly “green” energy in an attempt to power an advanced economy without fossil fuels, for example, will itself burn more than our remaining carbon budget.  Indeed, since nobody has figured out how to do energy storage at scale and given the eye-watering cost of existing nuclear, the reality remains that large scale wind and solar have to be balanced with natural gas anyway – something which is currently driving European gas prices to the stratosphere as the North Sea fields deplete. 

These price spikes – which will feed through to European businesses and households in the course of the winter – have finally shone some light on the inflated claims for green energy, and it has been found wanting.  People may want to take action on climate change, but they also want solutions which can work in the real world rather than in the heads of academics who, one suspects, were inhaling something a little stronger than fresh air when they wrote up their research papers.

Five years ago, I warned that by refusing to acknowledge that a switch to renewables would mean a poorer and much less material way of life, environmental groups were setting themselves up to take the blame for the inevitable energy crunch which is now beginning to unfold:

“In this way, the coming shortage of affordable fossil carbon fuels is disguised by an attack on environmentalists for promoting climate policies that appear to choose renewables over coal…  It is likely that when the lights go out, anti-fracking campaigners will face similar accusations.  Although fracking on any serious scale is an unaffordable pipe dream, rather than understand that its failure is due to Britain’s tortured geology and the unaffordable cost of extracting what little gas is technically recoverable, the energy companies will want to blame protestors for standing in the way of the fracking industry.”

Some commentators are already calling for a re-examination of fracking as a potential solution to Britain’s energy crisis.  Meanwhile the government is reaching for small modular nuclear reactors as the best non-fossil carbon option left on the table.  But these are less of a threat to the net zero project than an increasingly plausible – in economic terms – argument that since we have passed the point when we might have avoided two degrees of warming, states like the UK should invest in adaption rather than waste any more money on doomed attempts at prevention.  One such argument is made by Aris Roussinos at UnHerd:

“The issue at hand is that Britain is responsible for a mere 1% of global carbon emissions, so that even if we achieved Net Zero tomorrow, nothing will change in terms of arresting climate change. China’s increase in coal production this autumn alone is already greater than Britain’s total carbon emissions: halting this process is, in the real world, almost entirely out of our hands.

“But if we can’t change what is about to happen, we can at least prepare for it…  I live in Britain, and for Britain having a similar climate to central France will not be the end of the world — but we should start planning for it now…”

We might take issue with Roussinos’ assessment of the likely consequences of two degrees of warming – particularly given our dependence on the outside world for food.  Nevertheless, as the cost of addressing climate change translates into Tory eco-austerity for those in the bottom half of the income distribution, we can expect such sentiments to grow louder.  Even as Pacific islands are disappearing beneath the rising oceans, British politicians will be under increasing pressure to put what money they have available into building British flood defences rather than even more wind turbines which barely scratch the surface of the world’s carbon emissions.

Trading safety for peace of mind

Oil analyst Art Berman introduced the idea of “tank theory.”  This is that, once you understand that an oil deposit – and the world’s total oil – is a finite resource, then, in a sense, what we are doing is the equivalent of draining a tank.  We might do it slowly, using such a precious resource only for the most important purposes.  Or we might drain the tank as fast as we can in order to make a fast buck while frivolously burning our way through it.

In the early decades of the oil age, nobody knew how much oil there was.  Early deposits were found just tens of metres beneath the ground in Pennsylvania and Oklahoma.  And even bigger deposits were found soon enough across the USA.  This seemed to imply that oil was bountiful and relatively easy to extract.  Although the dearth of oil across the rest of the industrialised world did not bode well.  Nevertheless, with the discovery of the oil crescent – which runs from the Arabian Peninsula up along either side of the Caspian Sea – the world’s oil future seemed secure.

That was then.  Today, we understand that there is a roughly 40-year lag between the discovery of an oil deposit and its production peak.  We also know that the same 40-year lag applies to oil deposits as a whole.  And since the peak of oil discovery occurred in 1964, global peak production should occur sometime either side of 2004.

In fact, conventional oil extraction peaked in 2005, and led directly to the financial crash of 2008 and the ensuing depression.  But it turned out that the 1964 peak of discoveries did not account for oil locked up in the source rock or in bitumen sands.  So that the opening up of Canadian and Venezuelan tar sands together with US shale oil provided the world with and additional decade or so supply of – albeit more expensive – oil.  Peak production appears to have occurred in 2018.  Although the impact of the pandemic on both supply and demand prevents us from saying for sure that the world now faces ongoing and unstoppable depletion.

Nor is depletion the only factor that we need to consider.  When the oil age began, the USA, Europe and Japan were the only industrialised economies able to transition from coal to oil.  But once the oil age really got going after World War Two, a process of combined and uneven development allowed many more states to leapfrog the coal age and move directly to oil.  But states whose economies were built on oil now find themselves needing ever more oil to maintain economic growth.  And for the OPEC states and the states of the former Soviet Union, this means an increasing proportion of their remaining oil going to power their domestic economies.

And so, the tank is draining both through depletion and through the diversion of oil away from exports.  And it is in this light that we need to view the Biden administration’s decision to release oil from the USA’s strategic reserve to keep the price of petrol low.  The first thing it signals – confirming the energy politics witnessed at last month’s COP26 – is that the wider world is no longer dancing to America’s tune.  Biden’s earlier demand that OPEC+Russia increase production so that American SUV owners can continue to enjoy happy motoring, fell on deaf ears.  There is, it seems, no law of nature which says that the remaining oil states have to divert oil from their domestic economies in order to power the American dream.  Indeed, the remaining oil producing states are currently enjoying oil prices just high enough to fund state spending for the first time since 2015.  So, they have little incentive to increase production in order to lower prices.

Given the difference between European and US fuel prices – due to the additional taxes levied on this side of the Atlantic – it is difficult to sympathise with American motorists who have reaped the benefits of cheap oil for decades.  It is though, worth remembering that high oil prices translate into lower consumer demand.  And given that Europe exports a lot of products to the USA, that loss of demand will come back to bite us.

The deeper problem – which is more acute in Europe – is that the oil tank is now emptying and cannot be refilled.  Pushing for cheaper prices simply means consuming more of what is left faster and for more frivolous pursuits.  It may give us a degree of peace of mind.  But our long-term safety depends upon working out how we are going to maintain some semblance of civilisation as the oil tank runs dry.

A reluctant nationalisation

Britain’s energy supply companies have been going bust in large numbers this autumn.  But the official way of dealing with the problem has reached the end of the line.  Until this week, when a company went bust, its customers would be handed over to one or several of the remaining supply companies; and usually placed on their – higher – standard tariff.  This worked to some extent when the bankrupted companies were small; although passing the costs on to the customers of better-run companies – including those least able to pay – has been a point of contention.  When, however, Bulb Energy collapsed, leaving some 1.7 million customers without a supplier, it proved impossible for the regulator to dump the stranded customers onto the remaining suppliers.

The Cameron government – arguably the most incompetent and catastrophic in modern British history – should never have allowed the energy supply market to be flooded with undercapitalised companies in the first place.  But in the name of competition, anyone with a computer and £35,000 was able to register as an energy company.  And many did, including several disastrous forays into the energy market by local authorities such as Nottingham’s appallingly run Robin Hood Energy

In part, the failure stems from an uncritical acceptance of the central claim of the non-renewable renewable energy-harvesting industry – that electricity prices were bound to fall.  The trouble is that the more non-renewable renewable energy-harvesting technologies (NRREHTs) were added to the system, the more the system became dependent upon natural gas to iron out the intermittency.  The result was that the upper cost of electricity was the price of gas at a point when the wind wasn’t blowing, not the price of wind power during a gale.  But so long as the North Sea gas fields continued to deliver, the price difference was small enough not to matter.  This changed in 2021 though, as the entire European continent ran short of gas, and prices rose by more than 400 percent.

The problem was compounded in 2017 by the introduction of a price cap on standard variable tariffs.  This was always a misguided policy, as I wrote at the time:

“The proposed solution from the current government is to impose a cap on the cost of SVTs.  This will work by limiting the difference in the rate between a company’s SVT and its lowest tariff. However, even this will take months (possible years) to legislate for because of the administrative chaos caused by Brexit.  In any case, it will not work simply because it is a classic affluent person’s solution to the kind of poverty they have never experienced.  It will provide most benefit to the small proportion of SVT customers who are affluent, by providing the biggest savings on the highest energy use.  But for the millions of UK households that respond to rising prices by turning off the lights and heating, the cap will lower their annual bills by pence rather than pounds; and so, will do little to alleviate their money problems.

“The energy cap will end up upsetting everyone and solving nothing.  This is because, while the failed quasi-market arrangements are an irritant, they are not the true cause of the problem.  The same arrangements were in place prior to 2008; when complaints about overcharging and switching supplier were limited to the affluent classes.  It isn’t the system that has changed; it is the broader operating environment.

“The harsh reality is this: the cost of energy is rising remorselessly.  The cheap North Sea gas, on which Britain built the current energy infrastructure, is gone.  In its place are increasingly expensive gas imports – something that the eye-wateringly expensive fracking of UK shale deposits is not going to change (assuming there is any gas to recover).”

Whereas Britain’s businesses have been hit with huge energy price increases this autumn, the cap has held household prices some £1,000 per year lower than the break-even cost of the gas and electricity being supplied.  This is why none of the surviving companies were prepared to take on Bulb Energy’s 1.7 million customers – at a loss of some £1.7 billion!  Nor could the regulator force them to do so.  And so, a form of backdoor nationalisation similar to that in the rail industry, has been used to run the corpse of Bulb Energy as a public concern.  As Nils Pratley at the Guardian explains:

“The special administration regime is untested in the energy market, but similar arrangements have worked for more complex businesses in the past – Railtrack in 2001, for example. The critical necessary ingredient is capital to underwrite energy-purchase and hedging contracts. That comes courtesy of the Treasury, which will be on the hook for Bulb’s losses until a permanent solution is found.

“So, in effect, the financial hit is being taken via the public purse rather than spread among everybody’s energy bills via the industry-wide levy system. Given how far bills will rise anyway next April when Ofgem next adjusts the price cap – £500, possibly, if the methodology is applied strictly – burying Bulb among general government expenditure probably represents good short-term politics.”

Since we can expect several more energy suppliers to collapse during the winter months, as has happened in the rail industry, we can expect these to be nationalised too.  But even this “solution” depends upon the price of energy coming down; and there is no reason to believe that this is going to happen anytime soon.  NRREHTs serve to increase the price of electricity to the end user, and the rate of increase will grow if the UK government continues to insist on this route to its net zero nirvana.  Until someone can invent a grid-scale storage technology, more NRREHTs simply mean more exposure to increasingly expensive gas to balance the supply.  And as the cost of energy spirals upward, nationalisation can only delay the inevitable:

“As with Britain’s railway network, the state can put its hand in everyone’s pockets and provide direct subsidies to the energy companies.  When it does, however, it is simultaneously removing that currency from elsewhere in the economy.  The resulting drop in economic activity – as seen in, for example, the gathering retail apocalypse – also translates back into a falling demand for rail travel and falling energy consumption.  In short, financial manipulation can delay our appointment with destiny, but it cannot save us from it.  And when the time comes, we are all going to be doing a lot more walking, cycling and shivering in the dark.”

As you made it to the end…

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