Training Wheels for a New Economy - Issue #15 - Fall 2005
Training Wheels for the Next Economy
More economists are taking a serious look at something everybody knew all along—the world is going to run out of petroleum. Recently, an article by James Howard Kunstler titled "The Long Emergency" appeared in Rolling Stone magazine and it drew national attention. Kunstler also has a book by the same title.
Although I was aware of the pending petroleum crisis, there are a few new insights I gained from the book:
• Our "Global Economy" is, in effect, the "Petroleum Economy." Cheap
petroleum is the sole reason for the high pace and scale of global
commerce.
• The world crude oil supply isn’t like a gas tank. Your car runs great
until it is completely out of gas. However, as the crude oil supply reaches
its peak, extraction expense will increase and yield quality will decline. Unlike your car, the Petroleum Economy is going to steadily run worse until it sputters out. It may take a few generations but the process has already begun.
• Alternative fuels and energy sources are very important but they will
not meet the consumption level that petroleum is fueling. The world,
especially industrialized nations, will have far less cheap energy to
consume.
• The new economy will be, by necessity, locally-based with a heavy
emphasis on food production.
• There is a huge energy and material input from petroleum into
agriculture. Food production is going to be on a smaller scale and more
labor intensive. Gone will be the days of economies supported by cash
crops. (Perhaps we’ll covert from grass seed to food grains in the
Willamette Valley?)
• There is a high degree of dependence on petroleum derived materials
like plastics, solvents and most synthetic chemicals.
• We are greatly dependent on natural gas and that is likely to run out
first.
This may seem like Utopia for those who are promoting the local economy,
but in Kunstler’s book he warns us that the
transition is likely to be difficult due to political upheaval and
depressed economies. Some of this process is already in effect with our
nation’s oil wars.
A self-sufficient local economy is hardly a radical concept. It has
always been an element of concern for the Chamber of Commerce and
local governments. Some local businesses feel the need to take further
steps. In 2002, a business group called "Corvallis Independent
Business Alliance," or "CIBA" was formed (for more information, see www.corvallisiba.org). It seems the HOURS program shares goals with more
and more people in our community.
Now more than ever, I see that the HOURS program is a way for us to
practice living in the next economy. Kunstler has no definitive
prediction on when the economy will start to change substantially but he
thinks that many of us will see it in our lifetime. When I joined the
HOURS program a few years ago, I thought it would be "so nice" for our
economy to be more locally oriented. I figured only a few like-minded
people would actually participate. Now I’m beginning to realize everybody in our community will eventually have no choice but to do business locally—and sooner than I might have imagined. The good news is we don’t have to face an entirely apocalyptic future. Our economic future will depend on our ability to pull together as a community. Individuals and families may go into survival mode when big changes start to happen. Instead of bunkering ourselves in or running away to some remote place to make it on our own, we would be better served individually if we help each other. With your HOURS in hand and your skills and products, now you can prepare for a more secure future for all of us. Remember that participating in local commerce with HOURS is not only pragmatic, but fun, easy, and immediately rewarding.
-Don Boucher