Question Everything

Steps toward an energy solution

Step 1 - Waking Up

The first step in solving any problem is first understanding it. In the case of energy and its role in our lives and in the economy we have a basic problem in understanding the problem. Unlike our native senses of physics (called folk or naïve physics), our inherent theory of mind (sometimes called folk psychology), and our naturalist intelligence (or folk biology), we have no inherent intuitions about energy other than the life mandate to get more of it! Our need is to replenish our internal energy supplies by whatever means necessary. That's it. This is non-negotiable (OK there have been cases of people going on hunger strikes for causes, but the fact that they can get sick and/or die is the exception that proves the rule!)

What we are missing is a folk thermodynamics, an intuition about how energy behaves in nature that would cause us to pay attention to things like conservation and proper budgeting. We are driven, psychologically speaking, to find food, shelter (warmth), and water. Everything else is secondary. Beyond these basic needs, modern humans have sought comfort and convenience as well as quickness in getting things done by exploiting new energy sources and clever inventions. Our native sense of energy is based on the fact that the sun always is there to give warmth and cause our food to grow. Our built-in instincts cause us to get testy when there are long bouts of poor harvests. But the sun has never failed to shine, even if there are cloudy days. Crop failures are generally due to drought or pestilence. The sun is always there for us. So, naturally, we evolved nothing more than expectations that energy is always available, we just have to find it and exploit it.

And our instincts about other resources are pretty much based on following the game. That is, as hunter-gathers, we evolved to pick up and move when local resources depleted. There was always somewhere else we could go when we ran out of stuff where we happened to be. We might have to fight off someone else to gain access, but there was more stuff to be had somewhere, when there were so many fewer of us anywhere.

It took a long hard battle of minds against the oddities of nature to find out that energy had a peculiar character about it. Unlike sand flowing through the narrow part of an hourglass and is simply still just sand but no longer on the top, when energy flows and does work, it changes irreversibly to a non-recoverable form. Energy and matter are alike in only one regard — they are both conserved. You can't make more matter nor can you make more energy. Neither are destroyed in any ultimate sense. One can, in theory be converted to the other (and we do know how to generate energy from mass via E = mc²) but nothing can increase or decrease the energy/mass of the universe, so far as we know.

As energy flows through material configurations it converts from one form to another, like light to electricity (photovoltaic effect). But the total amount of electricity coming out of the conversion is not equal to the total amount of light that went in — it is less and the amount of difference is dependent on the efficiency of conversion. The balance dissipates as unusable heat. If you could gather all the waste heat and the electricity and measure the total amount of energy it would be the same as the light that you started with. But energy 'quality' degrades with each conversion and unit of work done. Quality here means that you can get the energy to do work for you. Low temperature (waste) heat does no useful work so it is a loss every time.

This characteristic of energy is formalized in the Second Law of Thermodynamics. Sometimes referred to as the law of increasing entropy, it simply says that you will ALWAYS lose some energy in a system each time matter is moved or changed. It also means that, in a closed system, where nothing gets in or out, the contained energy will eventually distribute evenly throughout the system and thereafter nothing will change (known as disorder).

We humans have no folk second law to help us intuitively understand this insidious aspect of energy. Which is why we are in the fix we are in today with respect to having wantonly over exploited fossil fuels, increased our numbers beyond what the daily solar influx alone can support, and now expecting some technological magic to save us. We hold out for the latter precisely because we can't understand the Second Law automatically. We hold onto our profligate wastage, pumping oil like there is no tomorrow, discounting the future, because we don't really grasp the First Law (conservation).

In the end we will either use science, that won us the formal knowledge of thermodynamics, to regulate our uses of energy, or we will succumb to the Laws the hard way. There is enough sunlight to support a much smaller population using energy wisely. There is even enough fossil fuel to supply particular needs that can't be met easily by sunlight, or, more importantly, to help bootstrap us into the technologies needed to wisely gather and use sunlight (which includes hydroelectric and wind turbines). But only if we are far fewer in numbers. Even the burning of carbon-based fuels would not be a problem for global warming if it were restricted to a few wise uses.

The choice is ours to make. We know enough to understand the consequences of our choice. We are clever enough to implement a plan of action if we choose to act. But do we have the collective wisdom to do so? Will we wake up to understanding the problem?

Components of Sapience Explained

This is the third installment in what looks to be five installments in the series on sapience. Part 1, Sapience Introduction provided a basic overview of sapience and its relationship to our general and scientific understanding of wisdom. In part 2, Sapience - Relationship with Cleverness and Affect, I tried to establish a context for what sapience does in terms of the brain and mind model.

Now in part 3, The Components of Sapience Explained, I expand the four basic components of sapience in terms mostly of their relevance to mental processes and to wisdom as it may be realized.

Sapience is comprised of four basic functions: judgment, moral sentiment, systems perspective (in thinking), and strategic perspective. The last three work to support the first, judgment, so as to produce more holistic and morally-based decisions in complex, uncertain (usually social) problem domains where long-term consequences of current decisions must be anticipated. In other words, wisdom.

I have changed the citation approach from my first installment. I hope this won't cause problems. Also I need to mention that the citations and references given are all from books on the subjects and I have not cited primary literature. This is an integrative work where some somewhat disparate subjects are being brought together in order to synthesize a new framework. That is in order to build a model of what is going on in the human mind in a way that generates testable hypotheses for specialists to explore. I find that well chosen books by stellar researchers, who have already produced works of integration within their specialties, provide a base for further integration across disciplinary boundaries. Besides, the readers of this blog are more likely to find the books more interesting than wading through papers detailing methodologies and data.

I have heard, via e-mail, from several readers who are slogging along with this series. I understand that without some background in several (or more) of the disciplines represented in this work it will be real work to follow everything. And that is OK. I don't expect everyone to recognize every little reference or inference, but I think there is something in here for everyone. If nothing else than that this provides a list of books for interesting reading, it will have been worth the effort.

The next installment will look at some specific neurological aspects of what parts of the brain and how they operate to produce the four functions covered here. Those who are not terribly interested in how a network of neurons can produce models and use those models to produce judgments could understandably skip it. But I will attempt to keep it semi-untechnical. The final installment, however, will look at the evolutionary aspects of sapience and wisdom, how it got started in human evolution, and then where it may be going. That part will be, of course, speculative. But so is any strategic thinking about the future (read this article to see what I mean!) When this series is complete I will be ready to tackle the issues of the future of our world from a strategic view that incorporates the role of sapience — namely the evolution of higher levels of sapience or 'eusapience'. Homo eusapiens is what I had in mind as Human 2.0. Stay tuned.

This is the acid test

After watching the spectacle of the inauguration, seeing the joy in so many people's faces, and listening to President Obama's inspiring speech I must say I am moved to share the hope expressed in this historic occasion. Questioning everything also means questioning my own beliefs, assumptions, and understanding. I hope the new president has the ability, and we as a nation/world have the options to right the world. My short-term, seemingly pessimistic view could turn out to be wrong on any one or more of the dimensions I have written about. I hope things aren't as bad as they look to me. My long-term optimistic view — that humanity will evolve into a eusapient species — is what has motivated me to think about what we should be doing now.

The more I see Obama in situations like today's proceedings, the more I like him. He is human and potentially superhuman. Chief Justice Roberts didn't help the situation, but did you see how gracefully Obama stumbled on the oath of office but recovered without a blink of the eye? That says a lot to me.

Hopes are high, but so are expectations. The world is hurting and just about everyone expects this man to provide salvation. I suspect a lot of people are ready to sacrifice, to work hard, to change their ways, and basically follow Obama's lead. I know I am.

But I can't follow blindly. He has to lead in a direction that makes sense.

I've been claiming that energy flow is declining and the ability to do economic work is the root cause of our financial troubles. I further have claimed that this decline will worsen over time because there is no way alternative energy sources can be scaled up to prevent major contraction. So here is the acid test. Over the next four years Obama will have an opportunity to manage this decline, or, and this is clearly preferable, somehow reverse it. The next four years will tell all. Obama has a solid majority in the Congress, he has the goodwill of 60% of the populace in the USA and who knows how much of the world. The problems are daunting, but no one has entered office with a more supportive electorate/audience. If Obama can't pull it off, no one can I suspect.

Watching Bush depart was both a relief to see him go at last and a sadness for the carnage he leaves behind. How much of the world's woes can be attributed to this man and his minions? He has done incomparable damage to the world with his God-directed actions or inactions as the case might be. His attitudes toward global warming and energy policy have been outright destructive. The moral justice part of me wants to see retribution eeked out on this man and his cronies. On the other hand I suspect the real problems stem from us. We are the ones who burned fossil fuels as if there were no tomorrow. Bush just enabled us to keep at it even when the net energy flow decline started to have a negative impact on our economy. In a real sense, he gave us what we wanted. And he helped us lie to ourselves about the consequences.

Energy is the key to so many things. It is the one thing that Obama will have to put a significant amount of attention. My recommendations are to quickly attend to conservation and efficiency measures — the two things we know we can do something about. Conservation first, since that really is the lowest hanging fruit. This is where sacrifice comes in. We need to give up the discretionary spending on frivolous novelties and entertainment. We need to give up luxuries. We need to do it right away. And we need to intentionally reduce our use of fossil fuels immediately.

Efficiencies come next, but this will not have the immediate effect that eschewing the high life will have. Building insulation and reducing speed limits will be something we can start immediately. But increasing fuel efficiency and appliance standards will take years to start having a real impact. Nevertheless it beats the amount of time it will take to scale up alternative energy sources like wind and solar, not to mention nuclear fission. Austerity will actually help fund the early efficiency efforts. But we will still have to find resources to change out machines and build new sources. That is the part of the equation that is really mysterious. Where will the energy come from to bootstrap the new sustainable sources?

I hope to see Mr. Obama adopt a strategic position that recognizes the reality of peak oil and of the decline of energy available to do economic work. I hope to see him realize (in spite of the advice of Larry Summers, et al) that we are about to go into an era of diminishing wealth production and reversal of growth. Such a condition could be managed and we might yet avoid the worst kinds of consequences if we recognize the problem and plan for it.

So this is the acid test. For me, I've gone on record here as saying that I think we are going into contraction and should act accordingly. If Obama realizes the rhetoric of his speech in the real world then I will happily fail the acid test and life goes on. If, however, the next four years prove disastrous for our society then I will have to bite my tongue and not say 'I told you so.'

Of course we might both be right in certain ways. Perhaps the writing on the wall that I seem to be able to read will be seen by Obama too. Maybe he will recognize the inevitability of energy flow decline and start managing the process in such a way that it doesn't have to be as painful as it might be. He could do it through leadership and bringing the populace along. In his speech he called for personal responsibility, and that is exactly what will be needed. That, and understanding.

Best wishes to the new President

All my questions aside. Today we inaugurate a new President of the United States.

Though he is, in name only, the leader of the US, he is viewed by so many around the world as the great hope for the world.

I share that hope, even while maintaining a critical stance. If President Obama has the wherewithal to lead the world in what needs to be done, rest assured that a great many and myself are ready to step up to the plate and work toward a better world.

Best wishes Mr. President.

Questioning sapience - Could humans operate without profit?

My March 4, 2008 blog, "What does it profit...?" was an early essay on the notion of profit as both a natural biological phenomenon and as it manifests in the minds of human beings. It is generally assumed by most people to be a strictly economic construct, that is, only having relevance in the worl of Homo economicus. But I argued that it actually comes from natural systems, particularly biological systems, through which energy flows. When systems are relatively undeveloped in terms of stored energy, e.g. the internal complexity/organization of the system is not what it could be given the total raw energy available, then sub-systems have room to grow and develop by incorporating more of the energy flow into their internal structures, e.g. complex chemical bonds. They grow until such time that they can no longer extract useful energy from the flow. In ecosystems terms, various sub-systems (species, populations, and individuals) compete for the available energy. Eventually all such systems have attained their 'fair' share of the flow and reach the dynamic steady-state I talked about in that post.

Then in mid-March and continuing on into the present, I have off-and-on been blogging about economics and trying to show that the economy of man is not more than the economy of energy flow in complex systems. The human economy is really a sub-system within the Ecos system and that human behavior and decision making is largely centered around maximizing energy availability. The concentric shells of technology that surround us, as individuals, are really an outward extension of our own physiology. We are augmenting and amplifying our own muscle power and time with machine power and rapidity (more power applied per unit of time). The real nature of the economy, I have argued, is the flow of energy and the usage we make of it to do useful work.

My efforts have been aimed at providing an intellectual framework for understanding this more comprehensive view of economics and what we do for a living. It is a framework needed to better understand the problems our world faces today, not just the problems for humans, but the problems for the whole Ecos. Because we have not had such a framework, or have ignored the one offered by ecological economics along the same vein, we have not been able to analyze these problems effectively, nor understand their causes and interrelationships adequately. We don't recognize the root cause.

Those problems stem from the capacity of the human mind for cleverness, the combination of intelligence and creativity that propelled humans to a new level of complexity and organization. The new level transcends the mere biological. It relaxes certain constraints on what is feasible to accomplish, and has allowed human beings to dominate the energy flows on Earth. Most importantly, mankind has tapped into the huge but finite energy bank of fossil fuels — ancient sunlight captured millions of years ago and over millions of years and sequestered in the crust. Mankind has used these auxiliary sources of energy to generate civilization as we know it, most especially science and technology, but no less important, the esthetics. Unfortunately mankind accomplished these wonderful things without attendant wisdom. We built everything just because we could. We extracted more energy just because we could. We used up precious resources just because we could. And then we started robbing energy and resources from other species, causing extinctions, just because we could.

It wasn't that we were completely blind to what we were doing. We've had many scholars and sages warn against the unintended consequences of our capacities to invent and destroy. In fact we were extremely clever in the ways we found to dismiss those sages. But we, as a species, have been incompetent in terms of the level of sapience needed to understand and wisely develop strategic plans for how our species should integrate itself into the Ecos. It isn't our fault that evolution didn't push us a little further in terms of the capacity for sapience. We didn't invent ourselves. But that shouldn't get in the way of scientifically understanding ourselves.

I have been arguing that the flow of auxiliary energy (fossil fuels) is about to undergo an accelerating decline. The amount of energy available to our economy, which runs primarily on fossil fuels, to do useful work, is going to diminish. It will be gradual at first but decline more rapidly over time. Indeed I have strong, evidence- and theoretically-based, reason to believe it has already started. I attribute the current global economic situation to this phenomenon. And if I am right, then there will either be no recovery or a very weak short-lived, seeming recovery that will actually leave us worse off when it crashes (my reasoning is based on the attempts to infuse more cash into the system — bailouts and such — that will have the effect of creating more un-backed money supply.) In short the world is in for a long and painful contraction because there simply won't be enough energy to provide for everyone's needs, let alone wants.

The days of profit making are coming to an end. There will be no growing source of energy and so there will be no way to extract the extra energy out of the flow to create the goods and services we've become used to (at least in the West and North). Profit was what wealth was created in excess of what was needed just to maintain. Growth was possible when there were profits to be made.

Can humans survive in any kind of civilization in a world where profits are actually negative (loss)? I think they can, but only if they start using some careful, strategic planning. The ordinary biological response to contraction is intensified competition. The biggest, meanest mo-fo will take what it needs and too bad for the weaklings. That is my question. Will humans transcend this crisis the way they transcended mere biology in their cleverness?

A new kind of economy could be based on non-profit operations. We have plenty of examples of non-profit organizations doing useful, good work. I know it sounds like socialism, and maybe it is a kind of ultimate socialistic structure. But it would not be based on beliefs or ideologies (not an -ism). It would be based on the fact that in a contracting economy, capitalism (certainly as we've practiced it) can't work. Capitalism depends on profit taking and growth. But in a world of shrinking energy supplies profits cannot be made. And if they are made (local optimization), it will only be by a few and will contribute to the growing disparity between rich and poor. Hmm, maybe that is exactly what we have been witnessing for the past twenty years or so. The disparity has grown considerable. Could it be because of the shrinking energy flow that I think has already come?

Right now is the time that we should be having a global discussion about the role of non-profit institutions as the mainstay of any viable economic model for a sustainable civilization. Instead, the Obama economics team is trying to find ways to bring back the failed borrow-and-consume economy. They want to stimulate the moribund beast, thinking that that is the solution to the other myriad problems we have. Somehow they have managed the double-think trick to reconcile global warming (invest in clean coal!), energy security (solar and wind), and a growth-oriented economy. This is extremely shallow thinking at best. Or it is disingenuous politics-as-usual. I don't know which — maybe both. But a failure to recognize the reality of energy flow basics and what it means for the future of the world is going to be fatal.

Tom Friedman connects some of the dots...

...but not all of them. The world is "Hot, Flat, and Crowded", according to Friedman (Farrar, Straus, and Giroux, New York, 2008). He got that mostly right, I think. But he is missing a huge piece of the puzzle.

He admits that the world isn't completely flat (globalized and connected) but he maintains it is still headed in that direction. He recognizes the world is growing hotter due to greenhouse gas emissions. And he noticed that things are getting pretty crowded on the pale blue dot. Putting these ideas together he has done a reasonably good job of seeing the connections between these phenomena and understanding that there is a common thread weaving, if not through them (as in causing them), at least around them providing a connecting linkage. That thread is energy.

Friedman devotes an entire chapter to what he calls 'energy poverty' in which he notes (where have you heard this before?) that energy is the ability to do work. And he points out that all economic work is, well, work. His contribution here is to recognize that what we call poverty is really not having energy slaves to make the lives of people living in poverty better. Better, of course, means having clean drinking water and sufficient food as well as (to be part of the flat world) being connected to the Internet.

But exploiting energy from fossil fuels in the modern world means polluting and warming. Fossil fuel-based energy systems have us painted into a corner. We're heavily invested in fossil fuel extraction, refining, and usage capital. And even though peak oil production might be upon us, that capital has some useful life ahead, with a likely profitable return on investment (in dollars).

If you want to see how a 'religious' belief based in 'dogma' clouds critical thinking, go immediately to chapter 11; no need to read the previous chapters to see what I am talking about. Titled "The Stone Age Didn't End Because We Ran Out of Stones", Friedman plays on the quote attributed to Sheikh Ahmed Zaki Yamani, the Saudi oil minister back in the 70s. Yamani was pointing out that humans have always found ways to rearrange atoms in such a way as to form better replacements or substitutes for existing materials and machines. Bronze for stone, iron for bronze — stronger, easier to work with and providing opportunities for new uses. But if Yamani was comparing material invention with energy (oil in particular) it wasn't even an apples and oranges kind of comparison. More like apples and sand. You can hold apples in a basket. Sand will slip through the cracks.

In the chapter Friedman, a master of rhetoric, reveals his faith in market-based solutions. He maintains that given the right incentives, 10,000 inventors will come up with better solutions for alternative (cheap) and renewable energy sources. To be fair he does give due nod to efficiency and conservation, actions that might actually provide some benefit. But the reality that these opportunities to save energy are a very small wedge in the energy mix and will take decades to deploy to a point where they will make a difference seems to have not entered his understanding. But his real failure to connect all the dots is his undying belief that markets will stimulate innovation such that wonderful, new, "exponential" improvements in energy production — his "...abundant, clean, reliable, and cheap electrons..." (page 244). The reference to "exponential" comes from his recognition that there has not been much innovation in energy technology compared with, say, electronics. He realizes that it will take exponential improvement in energy technology to produce those cheap electrons. And that is part of his problem in understanding "the real" problem that I will return to below since it afflicts many people.

The market has indeed worked to encourage innovation in the world of mechanics and materials — rearranging atoms to get something new, some new functionality. Energy was not the issue throughout the Industrial Revolution. We had managed to find increasingly dense forms of fuel to apply to our work processes that move and rearrange atoms. Energy did not limit invention. And, there are so many kinds of atoms in abundance on the Earth, and they combine and interact with one another in essentially infinite ways that as long as energy was free flowing, there seemed no end to what we could invent in the material world. It is, unfortunately, natural that one might assume the same rules apply to energy. But, alas, they don't.

We have to be clear about this. We did not invent new kinds of energy. We exploited whatever new fuel we found that had a higher energy density and whose physical characteristics made it easy to handle. We may have innovated material mechanisms for exploiting the energy but we didn't design fuels to suit our needs (gasoline is a distillate from oil; we perform chemistry to extract a fuel). Nature provided a bounty of fossil fuel, that is fossil sunlight, and we simply innovated ways to extract it and use it.

So Friedman is missing this dot. Actually quite a lot of people, including some scientists who are not as up on the whole fuel-energy-exergy-work one-way street as they should be, are blinded by their experience with technological improvements in material things. They just want to apply the same logic that they see operating in the world of digital electronics, namely Moore's Law, which is not really a law as much as an observation that digital components (solid state transistors and wires in integrated circuits) are shrinking in size such that many more can be put on the same sized chip. Moore postulated that until device physics laws prohibited it, the number of transistors on a chip would double every 18 months (or so, originally it was about a year, but the rate seems to have dropped!). This is what has led to the Information Revolution. Computers are at the heart of virtually all advanced technology today. Digital electronics is what makes modern communications possible. Just over the course of my lifetime I have been a witness to this revolution. I was a part of it! And I was excited about it. Once, earlier in my life I saw it as the great savior of the world. With information you can do anything.

Anything, that is, but grow your sources of energy available to do useful work. Don't get me wrong. Friedman has a chapter about "The Energy Internet: When IT Meets ET", which is mainly about the energy savings that might accrue from developing the &Smart Grid". I certainly agree with Friedman on the basic idea. Of course, it begs the question of how this grid is going to be built and deployed in an age of diminishing conventional energy. All those computer and memory chips, not to mention the communications equipment, need to be built with a subsidy from oil and coal! IF we could build the grid and deploy it in a reasonable time it would do wonders for our efficient use of energy. By saving and reducing demand we might be better off. Of course that might only work if we are in a permanent depression and demand never grows!

No, it is the supply innovation that Friedman thinks will be boosted exponentially by the encouragement of the marketplace. He is a believer in markets as the salvation (though he does admit that some kind of governance oversight and wisdom would be needed — where is that to come from?) and he is a believer in techno-cornucopianism that magically we will subvert the Second Law of thermodynamics by finding the energy equivalent to Moore's Law. I've pretty extensively covered the two-part fallacy in his first belief; that humans are not sufficiently wise in making these kinds of decisions, either through markets or by decree, and that a sapient form of governance (employing hierarchical control systems) is far from what we have now. His second belief...well I'm not going to hold my breath waiting for that.

I applaud Tom Friedman for his continuing to observe, and generally report what he sees happening in the world very well. But he hasn't seen all the dots that need connecting. His conclusions are premature at best, and just wrong headed at times. He has deeply ingrained biases and interprets the world by the old conventional theories of how things work. Biophysical reality is not a part of those theories. Global warming is starting to draw attention to one side of biophysical reality — that humans do impact the climate and the rest of the biosphere, and at our own peril. But until the decision makers and decision influencers, like Friedman, really grasp the other side of biophysical reality — the real energy-economy link — we will continue to wish ourselves back to the consumptive, growth-oriented way of life. And the energy flow through our systems will eventually draw attention to that as a fantasy as well. Only then it might be too late to do anything humane about it.

[NOTE TO READERS: I am still working on the next installment of my thesis on sapience. If you have been following it, I beg your indulgence. Among other things, school has started up again and my teaching job takes a fair amount of my time. (Sounds like an excuse my students would use when missing a deadline!)]

The biophysical economy - the only model of reality

We take a break in the Sapience series for this inspired bit!

The big issue right now, for Obama and the new administration, is the economy. We are in the worst recession, according to all of the 'in-the-know' economists, since the Great Depression of the 30's. Well they should know. They predicted it, right? OK, not really. In fact the big question in my mind is: Just exactly what do economists know? They have been appallingly bad at predicting much of anything, certainly of late, and yet politicians and media people keep going back to the economic 'experts' in an attempt to understand what is happening to our world. The problem is, the economists actually don't know the very basics of economic reality. They are working on a bunch of hypothetical principles (not even real theories in the scientific sense) that are flat out wrong in many cases. But most of all, they don't understand the very basis of economic activity - the flow of energy through the system.

It is energy flow that allows any system to increase in complexity and stability over time, that is to evolve to its maximum state of organization. It does this by virtue of physical work, either mechanical or electrochemical, being done on the components within the system to increase their 'utility' within that system. Some of those components are imported from the environment, others may be recycled materials from decayed components. Work must also be done to export material that is no longer usable (maximum entropy state) so that it doesn't clutter and choke the system's workings. Energy of high potential and in a usable form must constantly be brought into the system to achieve this end.

This description is completely general and universal. It applies to all systems, of any scale, and any location in the universe. It applies to living systems and to the economic systems created by human endeavor. Humans take in both low entropy material and its stored chemical energy and use the latter to do the work of maintaining the body as well as generating muscle power to, among other things, acquire more material and energy (better known as food!) The human economy is, at its roots, a social form of an extended metabolism. It is basically both a kind of ecosystem and a metabolism whereby artifacts and organizations form and develop in order to facilitate more work being done. That, of course, means more energy needs importing in order to keep up growth and development. Whereas the economy of the body is designed and regulated by genetics, that of the human economy is developed by human ingenuity and culture. Genes and culture are both sources of knowledge to guide the respective energy flows through bodies and through economies.

An economy is subject to the same phenomena that plague a living body when energy is restricted. It appears, now, that it is also subject to the same problems that arise from taking in too much energy relative to the energy flow balance that would be found in a natural, healthy individual — namely the individual gets obese and bodily functions are often deleteriously affected. Our economy, our social body, I suggest, is obese and we are seeing the detriment of that obesity in situations like our credit crisis and the Madoff Ponzi scheme. Things, institutions, are not working properly. Certainly our regulatory apparatuses are failing in their duties.

But in terms of what happens to a body on a diet, we should be mindful of what happens because we are now on what appears to be a restriction of energy flow that will worsen over time.

Initially the body responds to restriction of caloric input by exhausting the stores of glycogen (stored carbohydrates) and turning to burning fat stores to keep the system running. We basically loose fat volume (unfortunately we don't lose adipose cells which during more profligate times will just go back to storing up fat!) and weight. But if the restriction continues we begin to use up other stores, namely protein in muscle, and our bodies can become emaciated and weak. At some point our organs can go into failure and we die from starvation. Recall the images of the prisoners at Auschwitz at the end of WWII.

Here is what I think is happening and what I think its effects will be. This is based on the basic principle of biophysical economics voiced above. It takes energy to do work, plain and simple. Reduce the influx of high-grade energy and you will reduce the amount of work that can be done. And we are in the throes of energy restriction now.

The first thing you have to understand about energy input to the economy is that it now has to be very high-grade (high potential) and in a form that is able to drive our prime movers (motors, turbines, and heaters) directly. This is the kind of power that you get from high energy dense fossil fuels. The second thing you have to grasp is that it requires energy to get energy. That is, you have to build drilling rigs and pumps and such to get the oil from underground, and now from deep water fields, and it takes no small amount of energy to build this stuff. You have to subtract the energy you use to build energy extraction/capture equipment and the energy used to move the fuels to points of use from the total energy available. In other words, the net energy available to do economic work (other than energy extraction) is what counts as input to the economy.

And that net value has been declining since the 70's. The biggest input to our economy now is oil. And here I mean high-grade liquids. Oil shales and tar sands are anything but high-grade — they require too much extra energy to convert to usable form to produce a viable net gain. With the move to non-traditional oil extraction, especially off-shore platforms for wells, the net energy gain to society has been starting to decline. The meaningful measure here is energy return on energy invested (EROEI or EROI). As this ratio (energy out/energy in) declines due to more energy being expended just to get the oil out of the earth, the net gain for each unit of energy goes down as well. For the past several decades we have been exploiting our large and giant oil fields at a greater rate even while the net gain has been decreasing. This provided the comforting feeling that our energy influx was still increasing. So we felt we could do ever more work and generate ever more wealth in our economy.

But another, related phenomenon was starting to raise its ugly head. Oil is, and all fossil fuels are, a finite resource. There is only so much in the earth and we have been pumping it out at an accelerating rate for the past 100 years. Or at least we were trying to do so. Back in the 50's M. King Hubbert, a geoscientist working for Shell labs proposed a theory about the long term properties of oil production. Essentially he showed that oil production follows what looks like a normal curve, i.e. it rises semi-exponentially but then peaks and starts to fall in a symmetrical fashion. This theory, Peak oil, proved prescient for oil production in the lower 48 states, where production did, indeed peak in the early 70's. Hubbert's model has been applied to the world oil production as a whole but it is hard to draw precise conclusions since so much of today's oil production is nationalized and data on production rates (as well as valid numbers on so-called proved reserves) are not available for analysis. Still some basic principles apply and there is no reason to think that the pattern of new oil finds (which has been dropping steadily) and subsequent peaking of production will not follow for the earth as a whole.

Indeed there is growing circumstantial evidence that suggests the peak is already here. A number of analysts have begun converging on a date in the early 21st century. Indeed production rates seem to have been flat since 2005. Some believe that looked at close up the reality is not a peak per se, but a plateau in which there is considerable fluctuation generated by various feedback loops, such as the price of oil and our financial system acting counter to one another to keep the price and availability of oil in wild volatility, averaged around the plateau level. Sound like anything we've seen lately?

The combination of peak oil and declining EROEI from early in this century have had a devastating effect on wealth production. Manufacturers and certain kinds of service companies have sought cheaper labor costs in an attempt to forestall higher cost production. We know where that one got us. Put simply, we are not able to produce as much wealth because we have less net energy. In other words, our economy is starting to go on a diet and before long it will be starving.

What makes this worse is that Hubbert's peak theory actually applies to any commodity that is finite. It applies to all fossil fuels, but also to necessary minerals and even uranium. And there is no recovery. The curve tends downward after the peak until it bottoms out at essentially zero. This is the case for all finite resources. Period. Moreover, don't forget that to get coal out of the ground it takes diesel fuel (from oil). So as oil becomes less available, so does coal (and natural gas).

Imagine yourself on a diet where each year your caloric intake was decreased and at an exponential rate! At some point your body crashes. You need a minimum caloric input just to maintain yourself. And children, of course, need to grow, let alone maintain. Now imagine the economy as this extended body with its metabolism being restricted by its food supply diminishing. It is as if you need fruits, vegetables, and meat, but you are only able to find grass, bark, and bugs; because of their poor energy content you are still starving.

Another fall out from this economic diet, the money that everyone thought was the currency will not be able to buy anything. And what there will be will take too many dollars to obtain in the old ways. Money is almost meaningless any more. The prices of stuff, especially fuels, is disconnected from the underlying value. Our financial system was built on borrowing against a future of wealth production that will never come. It is really no mystery at all why we're seeing this crisis. Pumping more dollars into the systems (creating fiat money with no backing) will only make matters worse in the not-so-long-term. Even if there is some minor recovery in the economy (that is we go back to spending and consuming junk just so we maintain jobs for people who need to borrow to spend on junk) it will be shallow and only lead to a worse crash. Our whole economy is little more than a giant Madoff Ponzi scheme. Or a pyramid scheme that has no base.

Now lest you maintain that hope for technology to come to the rescue, bear a couple of things in mind. First, the amount of energy coming from renewable sources today is exactly zero. That's right, zero. Secondly, alternative energy sources, such as wind and solar, account for little more than 1% of the total energy consumed by American society. That means a massive build up of these sources would have to happen almost over night. And the reason I claim we get no energy from renewables is that the equipment used to capture sunlight and wind is built using oil, coal and natural gas (with a minor input from hydroelectric). And unless those capital goods can be built using strictly their own energy capture then they are not truly renewable, or sustainable for the long term. That is the problem. We use way too much energy, both collectively and per capita, compared with what we could get in a truly sustainable way, in a time frame necessary to prevent a real crash. There is no way to get there from here.

Third is that any policy based on the magical thinking that a new, revolutionary energy source will be found if only we put the right incentives out there for entrepreneurs and inventors is going to be dead wrong. These are the thoughts of people who have never studied science and technology in depth, do not understand the nature of the second law of thermodynamics (as in you will NEVER invent a perpetual motion machine), and who were spoiled by the apparent effects of Moore's law as it works in digital electronics (but not in energy systems). There will be new technology. There will be breakthroughs that will help. But there will be nothing in the offing that will replace fossil fuels at the current level of demand (I know, never say never; but energy technology is truly constrained by laws that don't leave me with great hope.) Even if new technologies are forthcoming you still have the scale up, and adoption times to contend with. Believe me, this is a tough nut to crack.

I know that this is hard to swallow because of the implications — that the American/Western way of life is coming to an end. But it is time to face reality and start planning for the most likely scenarios. Rather than trying to jump-start the old consumer, wasteful economy, Obama should be leading the charge to get Americans off the energy splurge we have been on and start dieting ASAP. We have to shed the fat and conserve the raw energy as much as possible. This is the only way we will be able to have enough fossil fuels to bootstrap a new economy based on true renewable resources. It will mean abandonment of current lifestyles and beliefs about human destiny to be rich. It will require humans to recognize the ways of nature and forego hubris. It will require sapience!

Unfortunately, as I will be revealing in my future post on the evolution of sapience and its likely future, I am somewhat discouraged about the current species' capacity for sapient decision making. More likely, I suspect, that as the contraction gets more serious and people start dying governments will resort to what they always have resorted to in the past. We'll use up the last bits of fossil fuels trying to steal the resources from someone else. But, of course, we'll then not be able to exploit them even if we succeed. More likely we'll just go out with a bang.