Capitalism, Global Warming and Peak Oil

T Vijayendra

Yugant means end of an era. Two crises have come together that have endangered life on our planet and have spelt an end of the capitalist era. The first is global warming and the second is peak oil. Global warming, since it threatens life on earth, demands, on moral grounds, to reduce consumption of fossil fuels immediately. Peak oil and peaking of other non-renewable resources, brings down consumption of fossil fuels. Both will spell an end of capitalist era.

The system people live in today is called capitalism. Large part of the world, notably North America (USA and Canada), Europe, Japan, Australia and India are the main followers of this system. Many other countries like Russia, China and Vietnam who call themselves socialist also follow this system in a modified form. This system is based upon exploitation of the working classes and natural resources, resulting in creation of immense wealth, huge inequalities and environmental disaster.

Industrial revolution and capitalism began in the 18th century with the steam engine; that is, conversion of heat into motion. This heat primarily came from burning fossil fuels. Initially it came from coal but in the 20th century oil and gas were added to it. Fossil fuels have concentrated energy stored in them by degradation of plants slowly over millions of years. Because of their high density of energy, it is possible to control ownership, mining, processing and selling of fossil fuels by a small class of capitalists. Capitalism as a system depends on availability of fossil fuels, which run all the transport and generate most of the electricity.

Capitalism is beset with several crises. The first is the contradiction within its own class due to competition. Second is the contradiction with the working classes which are exploited and oppressed by it. Many other poor people are also directly and indirectly affected by it and are increasingly opposing it. The third is the over exploitation of natural resources, particularly fossil fuels.

Growth is a necessity for the capitalist system. That is why there is no let up in talking of GDP (Gross Domestic Production, which is an overall indicator of growth of the country), in the newspapers. Now growth requires consumption of resources. This consumption of resources occurs at a 'compound rate' (like with the compound interest rate that one learns in school) with respect to growth rate. A good way of understanding the relation between growth rate and consumption of resources is to find out that at a given growth rate, how many years it would take to double the consumption of resources. A simplified (but fairly accurate) formula is:

70/growth rate = No. of years in which the consumption of resources doubles.

Thus if there is 1 percent growth rate, in 70 years it will double. If there is 2 percent then in 35 years it will double and in 70 years it will be 4 times! If the growth rate is 10 percent it will double in 7 years—like the fixed deposits used to double in 7 years when the interest rates were 10 percent. Thus capitalism has resulted in an enormous consumption of resources. Also this growth results in using up corporate takeover of commons resources that the poor are dependent upon.

However, the actual growth in amount of resources consumed over a period will depend upon the amount which people are already consuming them. Thus, say an advanced capitalist country consumes 100 units whereas a developing country consumes only 10. Doubling for the former would mean 200 units whereas for the latter it means only 20 units. That is why the developing countries aim at a growth rate of 10 percent or so whereas the advanced countries cannot hope to have growth rate of more than 2-3 percent.

Another factor about doubling the consumption of resources is that with each doubling the consumption is greater than the sum total of all the consumption that has gone before it. Let see how this happens. The doubling means a series like 1, 2, 4, 8, 16, 32, 64, 128, 256, 512, 1024 and so on. Now each successive term is greater than sum of all the previous terms. Thus, 8 is greater than 1+2+4 = 7. Similarly 1024 is greater than 1+2+4+8+16+32+64+128+ 256+512=1023. As one can see, with each doubling the total increases to a bigger number. So after a time the consumption of resources will be astronomical. But the total quantity of fossil fuels and other mineral resources available is finite; and with time, a crisis must come. With the growth imperatives of capitalism, the crisis has come now. It is this astronomical consumption of resources that has given rise to the two crises:
1. Global Warming and Climate Change and 2. Psak Oil and Peaking of other Non-Renewable Natural Resources.

Global Warming
The main cause of Global Warming is burning of fossil fuels in astronomical quantities by automobiles and coal based thermal power plants. The consequent release of greenhouse gases (GHGS), mainly Carbon Dioxide CO2, is so huge that it far exceeds the earth's capacity to absorb them. The CO2 content in the atmosphere had been steady at about 280 parts per million (ppm) during the first 10,000 years in which agriculture provided food for humans, but that regimen changed with the use of fossil fuels energy. 350 to 360 ppm is now accepted as the maximum for maintaining the warming under permissible limits, beyond which it may, become irreversible. But today this is near 400 ppm!

This consumption of fossil fuels is not evenly distributed across the globe or among the people within a country. An average American puts into the atmosphere 18.5 tons of CO2 emission per year as compared to a mere 1.8 tons by an average Indian. These averages hide the fact that most of the carbon output is contributed by the 20% rich of these countries and that the poor consume far less energy. Thus, there are extreme inequalities in GHG output within and across countries.

This level of release of GHGS is relatively a new phenomenon. For tens of thousands of years, humanity existed by slowly changing the natural environment and ecology to meet its survival needs. However, human activities of the present day that lead to increase in greenhouse gases are very specific. They do not pertain to the tribal or community-based village life that humanity led in the past and which even today billions of poor people lead. Emission of GHGS is the direct consequence of coal-based steam technology that led to the Industrial Revolution and mass production of goods. In the 20th century, oil replaced as well as supplemented coal, causing further pollution and Global Warming.

The capitalist system has consumed so much coal and oil in such a short time that there is close to a critical point at which Global Warming becomes irreversible. If that happens, much of life on earth will come to an end. Many experts believe that there lies only 10 -20 years left to stop it. All attempts within the capitalist system have failed miserably and there is no alternative but that this system itself should be dismantled. Since the growth imperative is inherent in capitalism, this crisis cannot be solved within capitalism. So on moral grounds, to save humankind and life on earth, capitalism must come to an end and it is the moral duty to bring it to an end as soon as possible.[1]

Peak Oil
At the same time, the other crisis, that of 'Peak Oil' makes the end of the capitalist system imminent. Although wide scale use of petroleum and its product has a history of only about 100 years, it has become central to the very existence and functioning of modern societies. This is mainly because transport and power are essential for modern societies. Moreover, there is always an annual increase in the demand for fossil fuels, because the system survives through constant growth. Any decline in the supply of oil threatens the very basis of modern societies. Peak Oil does exactly this and leads to the collapse of the system.

What exactly is Peak Oil? At the present rate of consumption, all available oil will be used up within this century. But Peak Oil is not about when one runs out of oil, but rather, when the production of oil starts to decline, and this has already happened (2005-2008) and the world is witnessing the effects in a global dysfunction of capitalism which manifests as 'economic recession.'

Peak Oil crisis started with a rise in petroleum prices. In 2008, it reached USD 147 per barrel of oil. This was one of the major factors in ushering in an economic crisis; a recession in North America, Europe and Japan. This crisis is leading to a worldwide collapse of the global economic system. Since the 2008 recession, capitalism has been beset with one global crisis after another. The three traditional bastions of capital, USA, Europe and Japan are in a permanent crisis. The new powers China and India are plunging into a crisis this year. Within a few years the whole capitalist world will plunge into a crisis.[2]

Peak Everything
It is not just oil that is depleting. Now for the first time, in 2012, a comprehensive set of figures has become available that discloses the use of the Non-Renewable Natural Resources (NNR) or minerals that have made industrialized civilization possible. A comprehensive study shows mineral usage rates. Meticulous examination of 89 of Non-Renewable minerals shows that usage rates are peaking and that remaining supplies are dwindling rapidly. This means that continuance of existing living standards that are dependent upon these minerals is impossible.[3]

The period of rapid global economic growth prior to the Great Recession of 2008 is a thing of past. The magnitude associated with global NNR. requirements became historically unprecedented by 2008. 2008 was simply the transition point, the year during which the number of permanently scarce NNRs became sufficiently large to permanently depress future economic growth trajectories.

All indications are that developed and developing economies will attempt to re-establish and maintain or exceed pre-recession economic output (GDP) levels and growth rates, both domestically and globally. However, that ever-increasing NNR scarcity has rendered these goals physically impossible. By 2008 US economic output (GDP) had peaked permanently. And by this year, 2013, rest of the world has followed suit, including India. That spells a doom to development within a short span of time—may be a decade or so. If no alternatives emerge people are facing a societal collapse not later than 2050. Can the renewable save us?

Renewable Natural Resources
Renewable Natural Resources (RNRs)—i.e. air, water, soil (farmland), forests, and other naturally occurring biota—enable all life, including human life. RNRs provided all or most of the life supporting essentials—water, food, energy, shelter and clothing—in pre-industrial societies. What is their status now?

Earth's ability to provide bounty from renewable resources is not available any more. In 1992 Mathis Wackernagel and William Rees attached figures to the annual bounty that humans obtain from what grows—forests, soils, fisheries, etc. Building on this, a Living Planet Index now indicates the health of world biodiversity and an Ecological Footprint provides a measure of the people's demands on Earth's resources. These figures show that consumption of the earth's renewable resources is now one and a half times the rate at which the earth produces its bounty, with the excess coming from consumption and depletion of NNR. These findings are based upon extensive studies, including trends in forests, fields, and in almost 8000 vertebrate species and demands of more and more people. The consequence must be higher food prices. As everyone knows this is already a reality.

The Coming Famine
Global Warming and Peak Oil have combined to create a famine in the world. Due to Global Warming the summers are getting hotter and hotter. The summer of 2012 has been so hot it has burnt crops in the USA, Canada, Russia and Australia.

Due to Peak Oil, a large area of the world's farmland is being used to produce bio fuels. And again, due to Peak Oil, the inputs to agriculture: fertiliser, pesticide and farm machinery—all dependent on oil—have become prohibitively expensive. This is in turn driving up food prices all over the world.

As is well known, famine is caused both by decrease in production as well as increase in prices, which pushes food beyond the reach of the poor. Famines do not just happen on their own account. They are perpetrated as the result of policies that privilege the rich and powerful, and, by implication, harm the poor. By the end of this year and the middle of next year, large scale famine is expected all over the world.[4]

The capitalist system is imploding and collapsing. Whether the collapse comes in a couple years or a decade, is not predictable. There are too many fast changing variables, the most important being the people's struggle against it and the vision of an alternative society. But irrespective of when it happens, the world has to face either chaos or prepare for the transition into a society based on lower energy and greater equity. Such a society will have different forms in different parts of the world, depending upon their history.

Chaos or Transition
Many scientists believe that the time for action is over and people are facing 'Apocalypse Soon!' A recent article in Scientific American outlines the possibility of such a scenario.

'Four decades ago, a Massachusetts Institute of Technology computer model called World3 warned of such a possible course for human civilization in the 21st century. In Limits to Growth, a bitterly disputed 1972 book that explicated these findings, researchers argued that the global industrial system has so much inertia that it cannot readily correct course in response to signals of planetary stress. But unless economic growth skidded to a halt before reaching the edge, they warned, society was headed for overshoot—and a fall that could kill billions. Dennis Meadows, professor emeritus of systems policy at the University of New Hampshire who headed the original MIT team and revisited World3 in 1994 and 2004, has an even darker view. The 1970s program had yielded a variety of scenarios, in some of which humanity manages to control production and population to live within planetary limits (described as 'limits to growth). Meadows contends that the model's sustainable pathways are no longer within reach because humanity has failed to act accordingly.'

"We're in for a period of sustained chaos whose magnitude we are unable to foresee," Meadows warns. He no longer spends time trying to persuade humanity of the limits to growth. Instead, he says, "I'm trying to understand how communities and cities can buffer themselves" against the inevitable hard landing.

When will collapse occur? Global Warming theorists talk of 2040—50, whereas Peak Oil theorists talk of as early as 2015!4 What does this imply for human society? Without doubt, there will be chaos and a scramble for remaining resources—the best high density fuel remaining is charcoal. Whole forests will be burnt to make charcoal to serve the ruling class. Evidently, the poor will resist and attempt to survive the crisis, and a period of lawlessness can occur. It will be a grim period lasting maybe several decades, but once humanity exhausts itself fighting over shrinking resources, a recovery may occur. It is difficult to say how this scenario will unfold, but it will definitely take place in some parts of the world and unfortunately it might happen in large parts of India too.

What else can happen during this period? With the arrival of Peak Oil, the curtain has closed on Act 1 of the drama Petroleum Man. What will happen in Act 2? Chekhov said, 'If there's a gun on the wall at the beginning of the play, by the end it must go off. In the world's nuclear arsenal there are many guns on the wall. If life copies art, will there be an Act 3 in which the players, having learned their lesson the hard way, live sustainably? So if people do face a nuclear holocaust then there may arise a situation where the 'living shall envy the dead.'

The concept of transition implies that people should go through a period of transition where they bring forth changes in their community/country incrementally, so that a smooth transition occurs towards a fossil fuel free society. Three things must happen if anything worthwhile emerges out of all the chaos and suffering that these crises will cause. The first is the end of capitalist/industrial society, the second is a transition to a society, based on equity, scaling down of energy use and local self sufficiency and the third is to change humanity's attitude towards nature. In this, there are two paths or models before the world—one is Cuba, the other is that of Transition Towns.

It is possible that in some countries social revolution can occur with an explicit aim of equality and of reducing energy consumption. It is not an impossible dream. There is already a living example of it: Cuba.

Cuba is a small country in the Caribbean, with a population of about 11 million. In 1959 they had a revolution led by Fidel Castro and Che Guevara. The original revolutionary agenda, like that of most socialist revolutions—like that in Soviet Union, China, Vietnam etc. was industrialisation with equity. Cuba too took this route, but because of the US embargo on trade, the Soviet Union was the only source of oil for the country. But in 1989, something happened.

In 1989, the Soviet system had begun to collapse, and Cuba stopped receiving petroleum from the USSR. That is, 'Peak Oil' hit Cuba in 1989, though in an artificial manner—because in the world as a whole, there was no shortage of oil. The year 1989 ushered in the 'Special Period' in Cuba, where the country had to manage with extremely limited supplies of oil, a scenario that has begun to hit the rest of the world now.

It began with a nation-wide call to increase food production by restructuring agriculture. It involved converting from conventional large-scale, high input monoculture systems to smaller scale, organic and semi-organic farming systems. The focus was on using low cost and environmentally safe inputs and relocating production closer to consumption, in order to cut down on transportation costs. Urban agriculture played a significant part in this effort.

When oil supply stopped in 1990, transportation grounded to a near halt. There were no cars running; public conveyance collapsed; and the streets were empty. People walked. Around 1993, Cuba imported 2,00,000 bicycles from China. To begin with, trucks were converted to buses by simply welding steps to the back. A skeletal frame of rods and a canopy were added. The concept was refined into the Cuba's mass transit bus the 'Camellone' (The Camel). Built on a long chassis vehicle, it can accommodate 250 persons. For shorter distances there were cycles and auto rickshaws. In smaller towns, horse drawn or even mule drawn 'cabs' were to be spotted. Car-pooling and ride sharing is common in Cuba. There are designated government officials in yellow uniforms who have the right to pull over even government vehicles and seat people in need of transport.

Cuba provides the world with a 'live experiment' where one can observe the whole cycle of Peak Oil, economic crisis and recovery. Even with regards to Global Warming, which has become a major crisis now, Cuba has achieved all the goals of reducing its carbon emissions. Thus Cuba has lessons for all on how to meet the present challenge. The Special Period in Cuba is like a real time model that has proved viable on a large scale, which other countries too could follow.[5]

Cuba is the only country which has consciously and successfully met this challenge of transition. Its ultimate success depends whether the rest or the world also follows this road or plunges into a world war.

Meanwhile local initiatives are also coming up in many parts of the world to meet this challenge. The Transition Town Movement represents one such initiative.

Transition Towns
Three things must happen if anything worthwhile emerges out of all the chaos and suffering that these crises will cause. In Cuba only two conditions were fulfilled, those of end of industrial society, and transition to a society based on lower energy. For fulfilling the third condition, to change humanity's attitude towards nature, one has have to look at the work done by the Transition Town Movement.

‘Transition Towns’ is a more recent phenomenon. It is a grassroots network of communities that are working to build resilience in response to Peak Oil, climate change, food insecurity and economic instability. ‘Transition Towns’ is a catchword for environmental and social movements founded upon the principles of permaculture. Today Permaculture has come to mean a whole life system encompassing various strategies for people to acquire all those resources, including access to land needed to evolve self-financing and self-managed systems to provide for all their material and non-material needs, without depleting, polluting and destroying the natural resources of the biosphere. The Transition Towns brand of permaculture uses David Holmgren's 2003 book, Permaculture: Principles and Pathways beyond Suslainability. These techniques were included in a student project overseen by permaculture teacher Rob Hopkins at the Kinsale Further Education College in Ireland. Two of his students, Louise Rooney and Catherine Dunne, set about developing the transition town concept and took the far-reaching step of presenting it to Kinsale Town Council, resulting in the historic decision by councillors to adopt the plan and work towards energy independence. The Transition Towns movement is an example of socio-economic localisation.

The idea was adapted and expanded through 2005, 2006 and beyond in Hopkins' home town of Totnes where he is now based. The initiative spread quickly, and as of May 2010, there are over 400 communities recognised as official Transition Towns in the United Kingdom, Ireland, Canada, Australia, New Zealand, the United States, Italy, and Chile. The term Transition Towns has morphed into Transition Initiatives to reflect : the range and type of communities involved—e.g. villages (Kinsale), neighbourhoods of cities (Portobello, Edinburgh), through council districts (Penwich) to cities and city boroughs (Brixton).It began with a nation-wide call to increase food production by restructuring agriculture. It involved converting from conventional large-scale, high input monoculture systems to smaller scale, organic and semi—organic farming systems. The focus was on using low cost and environmentally safe inputs and relocating production closer to consumption, in order to cut down on transportation costs. Urban agriculture played a significant part in this effort.

Central to the transition town movement is the idea that a life without oil could in fact be far more enjoyable and fulfilling than the present: "by shifting our mindset we can actually recognise the coming post-cheap oil era as an opportunity rather than a threat, and design the future low carbon age to be thriving, resilient and abundant—somewhere much better to live than our current alienated consumer culture based on greed, war and the myth of perpetual growth."

An essential aspect of transition in many places is that the outer work of transition needs to be matched by inner transition. 'In order to reduce our dependence on energy we need to rebuild our relations with ourselves, with each other and with the natural world. That requires focusing on the heart and soul of transition'.[6]

There is a race between a catastrophe that is being unleashed by global warming and a social and political revolution that can end capitalism and usher in a fossil fuel free world based on equity and scaling down of use of resources. The race is hotting up as can be seen by the latest figures of global warming.

The carbon dioxide in atmosphere reached the 400 ppm level on May 9, 2013 much before the estimated time of Aug 2016. It shows that despite all the annual conferences under the UNFCC to arrive at a solution for climate change, people have accelerated the pace of climate change through increasing carbon emissions. It is now impossible to limit increase in temperature to 2°C. It all shows that one cannot rely on governments to take care of this serious issue and the people have to take direct actions for a system change that alone can prevent climate change. Inaction means extinction of humanity.

Capitalism is not just 'us' and 'them'. It is a relation between capital and labour and involves everyone. Apart from the revolutionary alternative, there are many ways to end capitalism. People can all disengage from this relationship incrementally by refusing to be irrational consumers, working for local self sufficiency and working for the community and not for capital.

The collapse of Capitalism is given, it is already happening in parts of the world, but it will not automatically usher in a new world. It will just result in chaos. It is up to the people's movement to bring in the alternative before the global warming becomes irreversible.

1.    Global Warming by Nagraj Adve, 2012, Nellore, Jan Vignana Vedika.
2.   Peak Oil Primer, 2012, Nellore, Jan Vignana Vedika.
3.   Scarcity, Humanity's Final Chapter? By Christopher O. Clugston.
4.   The Coming Famine in India by Binayak Sen, September 6, 2012, New Delhi, A N Das Memorial Lecture.
5.   Apocalypse Soon: Has Civilization Passed the Environmental Point of No Return? By Madhusree Mukherjee May 23, 2012.
6.   Cuba Without Isms by T Vijayendra, 2012, Nellore, Jan Vignana Vedika.
7. Transition Towns, from Wikipedia, the free encyclopaedia.

Frontier, Autumn Number
Vol. 46, No. 13-16, Oct 6 - Nov 2, 2013

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