Consciousness of Sheep
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Civilisation has a series of building blocks similar in their way to Maslow’s hierarchy. Food, water and timber are obvious enough… although not so easily acquired in a complex industrial civilisation. Steel and cement are the building blocks of our critical infrastructure. And less obviously, energy is the essential but oft overlooked input without which everything would collapse (literally and metaphorically). Plastic, fertiliser and salt are also essential to the functioning of a complex industrial economy.
Despite the inflated claims of the non-renewable renewable energy-harvesting technology (NRREHTs) enthusiasts, all of those building blocks depend upon fossil fuels. Not just for energy, or solely the burning of oil in transportation, but also for industrial chemistry and for degrees of heat far higher than can be produced by electricity. While it might – over time – be possible to feed a large human population via regenerative and organic farming methods, without the Haber-Bosch process of fixing atmospheric nitrogen using natural gas, seven out of every eight humans alive today would be dead within weeks. A sudden loss of transport fuels would have a similar impact, though over a slightly longer timeframe.
Only in the first – water-powered – phase of industrialisation could we realistically talk about a sustainable civilisation. But, for better or worse, the massive release of energy from first coal and later oil, together with the associated technologies and chemical processes, put us on an unsustainable course in which we either grow or collapse – there is no steady state. This is something completely overlooked by economists and political ideologues. Nevertheless, the second law of thermodynamics applies – without ongoing maintenance, that is, the continual input of energy and resources, everything we have built will fall apart.
This would not be a problem if fossil fuels were infinite. But they are not. And worse still, we have burned our way through the easy deposits first, so that, with each passing year we have to divert more energy and resources into securing the energy we need. This, in turn, means that the cost of energy trends up (although falling demand caused by economic depression serves to maintain or lower the monetary price of energy). And because energy is used in everything we do, general costs trend upward too.
Since the 2008 crash, western countries have experienced this in the form of price see-sawing. Oil reached a high of $140 per barrel then, with economists confidently predicting $200 per barrel by 2020. Instead, prices fell back to an acceptable $35 per barrel, allowing a small increase in economic growth by 2015. Two forces were at play. First, the high oil price encouraged the development of previously too expensive oil deposits – most notably the vast shale plays in the USA. Negative (real) interest rates fuelled the fracking boom as investors desperately sought higher than inflation yields. Second, and directly counter to the fracking frenzy, high energy prices, and thus high prices generally, caused consumers to cut back their discretionary spending, causing an economic slowdown which reduced demand for energy. This see-sawing continued until the world went insane in 2020:
Oil prices never quite rose high enough for producers, while only temporarily falling enough for consumers. Lockdowns, the global supply shock, and the economic war on Russia served only to exacerbate the trend to the point that European states like France and the UK are on the brink of failing.
Only access to some new source of cheap energy and resources can save the western states. And since 1991, the most obvious source has been Russia. As well as being the largest producer of natural gas, Russia is a significant oil producer and has large reserves of strategic resources like titanium, uranium, phosphates, potash, salt, graphite, silicon, platinum, palladium and rare earths. It also has large reserves of iron, manganese, chromium, aluminium, copper, nickel, lead, zinc, and tin.
With the collapse of the Soviet Union, western governments hoped for a quick balkanisation of Russia which would allow western corporations to gain the rights to extract all of these goodies for the benefits of western economies. Under the permanently inebriated leadership of Boris Yeltsin, it seemed this was just a matter of time. But under his nominated successor, and to the horror of western states, a prostrate Russia began to revive. Under Putin’s leadership, the corrupt oligarchs were shot, exiled or brought into line, and the economy was turned around (one reason why Putin remains popular to this day… and why the main opposition is far more anti-western).
The fostering of colour revolutions in the former Soviet republics, together with the eastern expansion of NATO up to Russia’s borders, were also intended to undermine the Russian government for the same purpose – to balkanise Russia and allow access to its energy and mineral resources. Ever since the 2014 coup, Ukrainian militia had been shelling the eastern – Russian-speaking – regions of Ukraine, while the Russian government had been arming pro-Russian militia in eastern Ukraine. However, this was tipped into war by US Vice-President Kamala Harris’s announcement at the Munich Security Conference that Ukraine would join NATO and that nuclear weapons would be based in Ukraine. This was no more acceptable to Russia than nuclear weapons in Cuba had been to the USA. And so, the invasion of Ukraine followed.
In this, the western states seem to have made the age-old error of situating the appreciation – believing all of the media hype about Russia being a gas station masquerading as a country, and that one only had to kick in the door for the whole rotten edifice to come down. Armed with the latest hi-tech NATO weaponry, Ukraine would easily reverse and repel the invading Russian army. And by Easter (2022) the package of sanctions imposed by the EU and the USA would collapse the Russian economy. Within weeks the Putin regime would have fallen, and a pro-western liberal government would have taken its place… so we were promised.
None of that happened. The sanctions brought economic ruin… just to Europe instead of Russia. Germany, France and Britain have all deindustrialised as a result of losing access to the cheap Russian gas that underpinned their industrial bases. European hydroponic farming was the first to be hit as the price of gas, and indirectly the price of fertiliser became too expensive. Steel working and aluminium smelting followed, along with petrochemicals. Nevertheless, European leaders remain convinced that some kind of Minsk III agreement is still possible and that part of the deal will involve cancelling the sanctions on Russian gas and mineral imports to Europe.
This is unlikely since Angela Merkel has admitted publicly that Minsk II was a trick to allow the west to rearm Ukraine. In any case, any agreement may come too late for the UK, where the key building blocks – steel and cement – are now in freefall – in both cases, the cost of energy is too high for corporations to remain profitable. France seems to be in an even worse position as it too attempts to borrow and tax its way out of a self-inflicted energy crisis. Nevertheless, in both states – and across the west more generally – the tacit belief is that some return to (the old) normal is possible.
Last week though – although you won’t have heard about it in establishment media – the world shifted to a new normal. China and Russia signed a deal to build the Power of Siberia II pipeline to connect the gas fields around Yamal and Novy Urengoy to Ulan Bator in Mongolia and then on to China. This is an obvious snub to the western states, as it shows that China no longer cares about western sanctions. But more importantly, Yamal and Novy Urengoy are the starting point for the pipelines sending Russian gas to Europe. Or, to put it another way, China and Russia just made Europe’s energy crisis permanent, as in future the gas will flow east.
If this wasn’t bad enough, India has recently moved closer to China and Russia while resisting US pressure to cease buying Russian oil. If Europe’s leaders are sufficiently insane as to give in to US demands to cease importing that Russian oil via India, Europe and the UK will experience the kind of oil shortages last seen in the 1970s… and this time there will be no North Sea fields to save the day.
Either way, the economies of Europe are deindustrialising fast, and there is no obvious route to recovery. Indeed, even the International Monetary Fund (IMF) which has been touted – albeit prematurely – as a possible saviour in establishment media recently will not be able to bail out both France and the UK, or Europe more broadly if Germany and Italy follow them around the U-bend.
This, unfortunately, points to an obvious – if unpleasant – direction of travel. Because there is one energy source that is still abundant in Europe. And burning it might just provide cheap enough energy to maintain some semblance of a viable industrial base. I refer, of course, to the massive European coal stocks, including the huge lignite (brown coal) deposit in Northern Ireland… those who share my kind of dark humour will enjoy the irony that the states which set out to lead the way on decarbonising energy – Britain, France and Germany – will be the first to revert to coal as the only option left on the table now that cheap Russian gas is heading east.
As you made it to the end…
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