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« Needing some time! | Main | What Should a President Do? »

October 03, 2010


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Excellent article, thank you. There are very few people in the world that really understand how economic growth, our monetary system, and energy consumption are inter-related. You are one of them.

Now perhaps you could take the next step and connect the dots with climate change. Since CO2 is proportional to energy use which is proportional to wealth creation, and the desire for wealth drives everything, I conclude that we will never voluntarily address climate change.

I do wonder if a peak oil induced permanent depression might be enough to drop CO2 below the required 350 ppm. On the other hand, a quick economic crash might push the climate past a tipping point due to reduced aerosol cooling.

Your opinion?


The "fixing things" section should not be about whether or not power listens to you but what could be done if you had power.


I share your "cynism". Homo S "Sapiens" won't listen, except for few precious exceptions - and these are worth the effort. Let the mad men go walk over the cliff or bump into the wall. Leave them alone and have a good laugh when they hit the fan. -- Alas it isn't that simple, we're all sitting in one boat (planet).

CO2 is here to stay for centuries. The level will not drop quickly. Plus, it looks we are meanwhile entering a phase where CO2 begets more CO2 by natural feedbacks. (E.g. Ocean phytoplankton decline, global net plant productivity decline, arctic summer ice albedo decline, forests burning off, fertile lands washed away, permafrost thaw, etc. etc. Luckily this is still slow feedbacks. The monsters of apocalypse are still in slumber, but one day they inevitably wake up and will quickly ravage the planet.) One such feedback could well be us hominids while frantically fighting our demise, caught in a spiral of death, destruction and delusion -- just like today's important economists...

So, hominids need to actively pull out the CO2. But forget geoengineering. There's one technique known since stone age: char coal agriculture (google "terra preta" and "biochar"). Char coal is fixated carbon won out of CO2 transformed by plant photosynthesis. No glitzy high tech needed - to the insult of the late Homo Colossus... Alas it need be done at large scale: About the equivalent of global forestry output needs to be charred for many decades - plus, drastic emission cuts. (Optimist/simplified math done e.g. here.)

The good thing is, char coal benefits soil (if done right) in many ways. So, when the s*** hits the fan people might be eager to employ it. Another plus, you get energy and chemicals (wood gas, oils, tars) when producing char.

Ceterum censeo: Not carbon negative, no Bodhisattva. Not carbon negative, no permaculture.

Larry Shultz

Hi George,
I think your postings are spot on. The fact that powerful people have only a partial overlap with the real world means that in the long run they will either lean more about the real world or the systems they direct will perform subpar or worse.

I think that once we get to an accurate number for GDP (that takes into account losses in the system) then we should only increase net new credit when and if the GDP grows. This implies 100%, not fractional (or hyper leveraged), banking reserves.
For at least the last 40 years debt has increasing faster than GDP of the USA.
In the long run massive debts will defualt either via inflation or insolvency. Inflation levels over the interest rate is not condusive to savings. Negative real rates on savings most likely increase the average discount rate of a society. This lowers sapience.

One question, is emergy the same as EROEI?

Molly Radke

"Look on my works ye Mighty and despair..." but of course the current ignorant Mighty will NOT look on your works, and as a consequence, we must ALL despair as we will ALL be caught in the consequences of their willful ignorance. Thanks for your excellent explanation of the inherent complexities of the EROI conundrum. EROI I'd heard of, but the inherent complexities of actually calculating the return on investment I'd never sat down and thought about.

And you can be SURE, as, alas, you are, that the Mighty will choose the comfort of faith and certainty over Questioning Everything....or ANYTHING, actually.

I've long felt that a planned economy was the only RATIONAL response to the actual limitations of a finite system. How ANYONE can believe that personal greed is good and universally beneficial and that infinite growth in a finite system is logically possible is quite simply BEYOND me. I quite realize that planned economies have not been all THAT successful (tho alas, history will demonstrate that so-called "free" economies were not very successful, ultimately also). Historically so-called "free" economies - simple agriculture and/or hunting and gathering - A. were not all THAT free, as they were bound by natural necessities - eating, the limitations of the surrounding natural processes and systems,etc., and B. they "worked" because the Bitch Goddess, old Mom Nature, took care of the sometimes hurtful work of keeping everything more or less in balance.

Of course the current economy isn't really "free' for every one now. It is only sorta free for the "Mighty Haves," who can always eat whatever they want, live how and wherever they want, etc., etc..... But they too will be bound by the natural realities around them

Planned economies had most of their problems because there was no practical way or will to come to common agreement about the priorities of what the economy should produce, and there was no way to manage all the information necessary to input and to manipulate in order for those societies to function smoothly and efficiently.

I see the problems of agreeing on the priorities of an economy as now the most difficult part of establishing a planned economy. We actually have folks like you who can sort out the complexities of the systems that will need to be in place, and we have the information management systems (computers) necessary to manage the horrific complexities of the necessary inputs of all the information needed to insure the efficiency of the system.

But of course what we lack is both the will to move in that direction and the understanding of why, in the end, it would/may be more humane for us to manage our economies rather than allowing the Bitch Goddess to retain ALL the power, tho of course in the end she will still have all the power. But we MIGHT be able to postpone The End with the judicious application of a little rational analysis and a rational application of the consequences of that analysis!

I firmly believe that we lack the will because we are too lazy to make the difficult effort required to understand why change is necessary, and we realize that at some level, many of us will have to "LOSE" something IF we, as a society, agree that the priority of ANY economy SHOULD be to ensure that ALL have three hots and a covered cot, access to health care and basic physical security. There are simply too many of us on the poor planet to enable folks like me - a retired teacher who is NOT one of the obscenely rich - to live with my husband in a two bedroom house with two vehicles, a lawn, a flower garden, a boat, etc. etc. etc. If ALL are to be enabled to have the basic necessities of life, universal down-scaling will be necessary, and given the prevailing mythology that MORE IS ALWAYS BETTER AND POSSIBLE, the necessary realizations and adaptions are simply NOT gonna occur. Alas.


Nice post Molly. You might be interested in Jay Hanson's America 2.0.

You may find him a little harsh but he is intelligent, well studied, and correct in my opinion.

George Mobus


Now perhaps you could take the next step and connect the dots with climate change.

I have actually written about this in the past. In fact I started my quest for understanding what we were doing to our world in the realm of climate change. But I soon realized that while that would be the most major challenge to the long-term survival of a hominid species with some intelligence, it would not be the immediate cause of collapse. Rather I suspect now that the decline of fossil fuel energies without the adequate substitution of renewables will be the downfall of civilization.

The key question for me is: Can a remnant of humanity survive what I imagine will be a bottleneck, and can that remnant take forward mental characteristics (specifically sapience) that would make it better suited to adapt to the environment resulting from unpredictable climate changes?

My focus on energy and economics is more geared toward preparing for collapse than climate change per se. But that preparation includes situating a group of highly sapient individuals to survive the bottleneck and be capable of the necessary adaptations.

I don't really have an opinion about the feedback effects of a collapse on CO2 emissions and resulting climate impacts. I agree with Flori that positive feedbacks have already likely set our course for bad stuff. I do not think that a rapid drop in the use of fossil fuels will help drop the ppm of CO2 down much any time soon enough to make a difference simply because of its residence time in the atmosphere and oceans, and the kinds of effects Flori mentioned.

I just want to assure that the survivors of collapse pass on genes to improve the capacity for wisdom that will be needed by future generations to use their knowledge wisely, something we have failed to do.


George Mobus


How, exactly, could I (or anyone who knew what to do) get that kind of power? My own view is that real power needs to be ceded to leaders by people who recognize the need to do so. Thus it still comes down to people understanding.


George Mobus


In order for biochar to work, don't you think there would have to be far fewer people putting demands on the environment first?


George Mobus

Hi Larry,

One question, is emergy the same as EROEI?

Emergy is the measure of the energy that was consumed in doing work. Odum called it energy memory. Others call it embedded energy. A printout of a computer program is just a piece of paper, but it represents quite a lot of energy that was consumed in building the computer and supporting the life of the programmer. So even though there isn't any potential energy to speak of in the paper itself, it carries a fairly high emergy value.

There are really two kinds of emergy depending on your point of view and values. Solar emergy is literally the total amount of raw (solar) energy that had to be transformed into exergy in order to accomplish the work. So, for example, the raw energy in barrels of oil would count as solar emergy. The other kind is direct emergy which is just the exergy value after it has been expended. People who are trying to account for environmental externalities will generally choose solar emergy as the basis for costing. Direct emergy is easier to measure and then use estimating techniques to work backward to get solar emergy.

EROI is related to exergy in that it is the cost, in energy, that must be paid to obtain a given unit of exergy. So it determines net energy (e.g. it took electricity to run the pumps of an oil well) or exergy which is effectively the same thing (perhaps ignoring some transportation/transmission losses).

Hope this helps.


George Mobus


Thanks for the kind words and the good summary. You might be interested to know that I've gotten a few e-mails asking if they could write in my name on the 2012 ballot for president! I told them sure, but they would be throwing away their vote.

I don't think there is anything a president or even quite possibly a dictator (benevolent of course) could do to change things substantially. As I currently see it the most a president could do is tell the American people and the world the truth and then wait to get shot. Not a very happy prospect.

Bottleneck is the solution to Earth's problems, but obviously not good for the human population as it stands.



Indeed, obviously. Still, biochar can help enhance and stabilize soil (e.g. water retention capacity - think drought) at risk due to climate change. So it is good medicine at least locally. Global climate medicine needs more work and sapience, of course. But methinks it's time to start acting at least symbolic. Thus my ceterum censeo.


Thanks for the response. The person I respect and trust most on climate change science is James Hansen. I highly recommend his book "Storms of My Grandchildren". He seems to believe we can get back below the maximum safe 350 ppm by stopping use of coal and heavy oil plus stopping deforestation. I don't think this will happen for reasons that are obvious. The point is that he believes 350 ppm is possible if we dramatically drop CO2 emissions. Hence my question about the possibility of an economic collapse saving us.


Hmm, good article.
You're definetly on to something, but I do not think this is the entire truth.

First of all - to avoid being a "doomist" - solutions, or at least what one or many persons can do to soften the "blow" is a good thing to think about. For instance more rapidly adapting society to non-oil dependant energy sources, starting to pay back on loans (individual and national) and making an effort into not expanding the "loan politics" even more could be a start...

Then I do not see a necessary connection 1-1 of oil vs economic growth, or rather, there is more ways to expand GDP than just oil...

For instance we can get energy from other means than oil. Here in Sweden for instance we get about 70% of our energy consumption from other means than fossile fuels.
Not to say that we are not depending oil, because we are, way too heavily, but it is a lot of other means such as hydrogen, wind and nuclear (out of which a small part of course depends on transportation and refinement of nuclear fuels - which is today probably made with oil)...

Also one could do a lot of thinking without oil - and thinking can lead to making processes more efficient, which can lead to a bump in GDP (i.e. producing more from less and more efficiently)

But in all, a good eye-opener, as you said: The right persons needs to be made aware of it though...

Gary Peters


This was an excellent post and one that deserves wide attention, so I was glad to see it on TOD.

As for wasting votes, I wasted my last one on Obama, so why not waste my next one on you?

Growthmania (a term coined, I think, by Edward Abbey) will be with us until something drastic happens. Oil production has been pretty flat for five years now, so drastic may come soon if global demand for oil starts to pick up and oil prices once again spike.

In the meantime Obama and his "team" continue to talk about "growing the economy," just as Bush and Clinton before him did. The only thing growing right now are the assets of the banksters that conned Obama into saving their sorry asses. Everyone else is left to fend for himself or herself.

Thais's Papito

Thank you Mr. Mobus,
After a 30 year career in the physical sciences and a stint in the financial sector following a second degree in IT I understand what you are saying and concur. I continually seek to find a succinct and clear exposition of the relationship of energy and economic growth because I cannot create it myself. Your synthesis of this economic conundrum is valuable in that it can be shared with others by those of us who believe "you get it" and can explain it with clarity. I thank you for that. Unfortunately I share your belief that unequivocal recognition of these logical axioms will not allow a benevolent leadership to convince a self-serving democratic society. I am convinced that Pogo understood it best when he said "Yep, son, we have met the enemy and he is us".

K Hagesten

I understand, and believe in what you are writing. Is is so obvious when you think about it.
Is is not only the "important" people that do not get it. I have tried for years to explain PO to friends to no avail(exept for one intelligent person). Now i have quit trying, and are only preparing me and my wife for what is coming. Many of the others are doomed in one way or another.

By the way, as i see it everyone cannot bee saved anyway when collapse comes, We are simply hopelessly overpopulated on this planet.

Reader from Sweden

George Mobus


Agreed! That is what this blog is - symbolic!


Hansen's book is on my to-read list, but there are several above it in the queue!

BTW: if Gary and the others vote for me and I win I would definitely have Jim as my secretary of the interior (if he wanted the job).

Hi Klas2k,

Thanks for the comment. You are right it isn't just about oil. It is about total energy. Over 80% of the world's energy comes from fossil fuels, however, so that is what needs to be replaced by alternatives. That is a tall order.

Oil is considered a 'king pin' in the energy arena (from the game of bowling). If it peaks and declines it will make getting the other fossil fuels extracted and to market given the current infrastructure, esp. transportation. For example diesel is a major input to coal mining so if diesel gets much more expensive (due to peak oil) then the costs will impact coal too. That is why there is such a focus on oil.

As far as thinking goes the brain uses up 1/3 of your energy balance when at rest (thinking, presumably). It takes a lot of calories and for the most part those come from food production that is very fossil fuel intensive. Ergo, lower the fossil fuel inputs and, using the current state-of-the-art in agribusiness a lot less food gets produced to support thinking broadly. If Flori's suggestion were followed, or my own suggestion to rebuild soils in the US as part of a jobs program, then we might be able to one day rely less on oil, but as things stand now and for the foreseeable future we need fossil fuels to think too!

As for efficiency, there are a couple of subtle gotchas there. See Jevons Paradox for one of them. The other one I alluded to in the piece. We appear to be reaching the point of diminishing returns on innovation and efficiency gains! Many of our prime movers are very close to their practical Carnot maximum and so investments in increasing efficiency are having less and less payoff.



If nominated I will not run, if elected... thanks for the confidence though!

You know I take some solace in knowing that the assets the banksters are accumulating are made of the same paper that they are creating. They believe the money in their bank accounts is real too! I'm betting a lot of them have mortgages on homes more expensive than they could pay cash for. So when the SHTF they go down with the rest of us. But, they may have it worse off since everyone will know that they caused this fiasco (at least the financial bubble fiasco). As they say, you can't eat gold.

Thais's Papito,

Thanks for the comment and welcome to QE. You are dead on target about democracy as it has evolved here in the US (and probably elsewhere in the OECDs). Eventually I can't help but feel we will get a dictatorship once bullets start flying (at the banksters!) We'd be very lucky if s/he were benevolent.

K Hagesten,

Greetings. If you hadn't seen it, you may be interested in my review of William Catton's book, Bottleneck: Humanity's Impending Impasse.

Regards all


sewa mobil

Nice article, thanks for sharing.

Phil Henshaw

George, What I am equally puzzled by, in addition to people do not realizing the importance of energy to the economy, is not realizing the the importance of money is as our means of directing all the physical choices involved.

It's sort of a double mind separation, that we see neither how physical processes are connected to the money, partly because we don't see we are directing the physical processes with our use of the money. Money gives you the right to request one or another highly complex physical process be done for you. The minute one realizes that, it seems to me, it's obvious what the problem with endless multiplying money is...

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