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Strategic planning points for Biodiversecity

Sunday, August 29th, 2010

In business as in politics, your tactics derive from your strategy. Strategy & tactics derive from your program. Program derives from your macro assessment. Macro assessment derives from your Critique or Analysis of the current situation, which arises from your basic worldview or philosophy. So it is with our need for strategic planning as we contemplate actually purchasing a chunk of land for sustainable urban agriculture here in Central Exposure, WI.

Here are a few strategic planning bullet points we expect to base our plans upon over the next couple few years.

1. Macroeconomic crisis. There is no basis for optimism about the macroeconomic environment. I said this in January, 2007 at a public forum and look, it still seems to be true today. Our macro economic outlook is for a deflationary double-dip recession (3-D recession).

This means that supplying local organically grown food from a small-scale urban ag. operation is going to be very challenging. The high end “foodie” market will continue to shrink, we believe. The low-income market is extremely cost conscious and this gives people marketing to this segment of the market very little pricing power. Everything must be done on a low-cost basis. Whether delivering organic food can be made affordable on a mass scale is an open question at this point. Few people seem interested in this question.

2. Peak oil problem. The global peak of oil production is probably already underway, or at best, within a half-decade. You can always follow the development of this on The Energy Bulletin yourself. Beyond the year 2015, just five years off, global oil production will be falling, and outside the OPEC countries, falling fairly fast.

Small local food producers should expect, as we do, the beginning of overt shortage of motor fuels around that time. We can’t predict what government will do in response, but given recent experience, we can expect that response to be a) too little, badly organized and b) too late, as shown for example in BP oil spill response. Small local food producers should expect themselves to be shoved aside by large corporate farms in their regions when it comes to the rationing of fuel supplies. Expect as we do a chaotic business environment.

3. Man-made global climate change. Most of our season’s production this summer has been ruined by too much rainfall in too short a time, falling on ground not well suited to excess rainfall in a veggie crop production scheme. We expect the man-made global warming to continue ramping up, leading to weather chaos which makes planning for crop production exceptionally tough.

We expect, as small-scale local food producers, to have to plan and spend excessively for both irrigation needs (for hot, dry summers brought by global warming’s regional effects) as well as drainage (for hot, wet summers brought by global warming’s regional effects). The land we have looked at for purchase was viewed with an eye on both these problems. Investment will be needed in both areas we’re sure.

4. Continued credit crisis. We expect the credit crunch or crisis to continue. Despite the massive bi-partisan bank bailouts endorsed by both G.W. Bush and Pres. Obama, banks are not lending out their cash, but instead are profiting from borrowing cheaply from the Fed and investing it in their proprietary trading schemes, bound to once again implode in the near future, exacerbating this crisis once again. We expect small-scale farmers and community needs including small-business job creation to be completely starved for credit going forward.

This means for us, we can never expect conventional bank loans nor small business loans via govt. as a source for capital. Everything will have to be paid out of current earnings. As small-scale producers we expect not to be alone in facing this challenge.

5. Continued unbelievable levels of unemployment. Not only are the Baby Boomers facing their suddenly becoming irrelevant in the labor market, but the 20-Something generation faces systemic, structural, persistent unemployment unlike anything previous generations of Americans have faced.

This means again that the high-end foodie market for boutique-style food offerings from small local food producers will remain constrained and not a high-growth area. This may mean, for small food producers, a need to try offering food at affordable prices. Given the chronic cash shortage many people are facing, various forms of barter — barter for food, barter for services needed by the food producers, and so on — may become increasingly important.

6. Class struggle intensifies. Since 1974 we’ve been studying and teaching the perpetual class struggle in America. In times of economic crisis, such as we expect chronically over the next decade, this struggle does not ease nor diminish, but intensifies.

For small-scale food producers, this means you should expect concerted effort by large agribusiness to continue driving you completely off the scene, out of business, and for government to generally take the side of large agribusiness. Small-scale producers who must depend on off-farm wage labor to support their farms should expect intensified workplace struggle, the driving down of your wages, the loss of pension benefits, loss of health-care benefits, and so on.

7. Crash and chaos scenarios increase in probability. Given America’s recent experience with large-scale crises, and the ongoing #fail mode we have seen with situations such as Hurricane Katrina, the Gulf Oil spill, and other situations, we expect incidents such as these to increase. Since Central Wisconsin is not highly urbanized, large-scale incidents are not expected. However, chronic, ongoing crises such as hunger and chronic underemployment will remain in our forecast.

We will remain open to participating in various crisis-mitigation and mutual self-help type groups as time goes on. This participation will depend upon our assessment that participation is grass-roots democratic and not driven by or dominated by local ruling elite interests.

Posted in Ag, Biodiversity, Co-operation, Economics, Ecovillages, MicroEcoFarming, Peace, Peak Oil, Political Economy, Sustainability, ecology, globalization | No Comments »

Wisconsin Farm Bureau tries to block raw milk bill that would benefit small dairy

Thursday, March 18th, 2010

I see here where the Wisconsin Farm Bureau testified against Wisconsin’s raw milk bill (click highlighted text for story)

“(Melvin) Pittman, who chairs the Farm Bureau’s Dairy Committee and milks 75 cows near Plum City with his wife, Pat (said) ‘If a person becomes ill from drinking raw milk, it is not only unpasteurized milk that gets a bad image, but all milk and dairy products. Dairy farmers have invested millions of dollars promoting milk and dairy products, and we can’t afford to have an incident adversely affect consumption.’”

If only the Farm Bureau would show such great vigilance in protecting consumers, and those beef farmers who are trying to do the right thing, when not one or two people, but hundreds, are sickened by feedlot-evolved E. Coli 0157 h7 contamination or Salmonella contamination of tens of thousands of pounds of beef or pork in these enormous packing houses run by the new meat trust.

The film “Food Inc.” tried to expose some of these problems of widespread systemic contamination of our industrial food system. Yet the Farm Bureau leaders go out of their way to disparage this movie. Frankly, they seem to hate it, and the filmmakers, and the people who watched the film and were moved by it. Why is that, do you think? Is it because the Farm Bureau is reluctant to criticize the meat trust, while eagerly going after small-scale dairy farmers who are trying to earn a parity price for their product by offering raw milk (which is enjoying growing consumer demand) direct to consumers?

Certainly the Farm Bureau has always been on the side of large-scale agriculture and large-scale monopolistic food processing corporations. It appears that in the Wisconsin Raw Milk Bill debate, they are once again intent on preserving this legacy of diehard defense of Big Food Processing.

I for one am strongly urging our Wisc. representatives to pass this Raw Milk bill. As a tiny-scale organic grower, I certainly know that the Farm Bureau has never represented, nor will ever represent, people at the small end of farming. We need our own farmer-labor (consumer) united organizations to represent the little guys and gals in small-scale ag.

Bobby G
Middle Wisconsin,
USA Sector of The Global Corporate Economy

Posted in Ag, Biodiversity, Economics, MicroEcoFarming, Political Economy, Sustainability, ecology, globalization | No Comments »

“Resiliency”: How could Portage County prepare for the peak oil crisis?

Monday, February 22nd, 2010

There’s a new term out there, one that’s quickly entering common usage: “resilient communities” as one definition suggests, it has to do with a community’s ability to survive an extended disconnection from the global grid in areas including energy…

Here in Portage County, what have local leaders at the County Board level been doing to make our county communities resilient with respect to energy? If you’re scratching your head, searching for something in your memory on this topic, you’re right. Not that much is being done to prepare for the coming decline in petroleum motor fuel product availability (gasoline, diesel fuel, heating oil, kerosene, jet fuel) which is part of the global peak of oil production problem. This problem is so far, not on the radar screen for the Board.

The problem of peak oil has not, in my memory, been publicly admitted by any of the County Board supervisors, nor by the current County Executive.

One hopes that candidate Patty Dreier, with her extensive connections into the sustainability movement in our region, will have some plan, some political programme, to deal with this problem.

One County Extension fact sheet notes this about County governments in Wisconsin:

“(Sec. 59.03(2) Wisconsin Statutes)…This home rule authority has allowed county government to gradually expand as a regional government in areas such as recycling, water quality management, transportation planning, and zoning review, but only in cases where a municipality or group of municipalities have requested the county to do so on their behalf through voluntary agreements.” (From this Extension fact sheet).

Note that there is one major area–planning for re-zoning–where our County Board and Executive could be preparing us for the disruption promised by the arrival of a) even higher price spikes in oil prices than we saw in 2008, along with b) frank shortages of many products. Peak oil will impact us far more than in the prices we pay for these refined products, once we reach the stage where there is no gasoline (or diesel or anything else) available at any price at your local filling station.

The County Board could be hard at work in completely overhauling the zoning codes in this county, by taking a leadership role in convincing municipalities–cities, villages, townships–that it is in their interests to abolish the old pattern of city centers and “bedroom towns.”

The “bedroom town” is going to have to quickly become a distant memory if we are to have any “resiliency.” This material was already well-covered in the film End of Suburbia. Portage County has its share of bedroom towns, many of which fit the definition of “food deserts.” A town like Rosholt fits several categories of desert: food desert, hardware & home improvement desert, drug/pharmacy desert, auto parts desert, etc. A family has to pile into the car (more likely, 2 or 3 cars) and head off to Point to get many of their needs met. How is this going to play out when petroleum depletion starts to hit home?

You can use your imagination. You can also use it to imagine a much different pattern, one that might work better in peak oil conditions. Higher-density housing patterns, housing co-operatives that perhaps share 20, 40, 80 or more acres useful in food production, for woodlots and wildlife habitat, but with housing sited densely on just a few of those acres, perhaps owned by many unrelated people, held in common. That would be one alternative, not currently in zoning Sharia law.

After putting the current zoning code through the shredder and using the shreddings for mulch or compost, next the zoning committees could take a look at the restrictions on ag land. Perhaps owners of smaller parcels could be allowed to pursue agriculture, from 5 acres on down to less than an acre. Perhaps family farmers could be allowed to site several family members’ houses on their property, without having to carve it up subdivision-style. Already-denser areas such as Merryland Drive between Rosholt and Polonia could be encouraged to develop in unincorporated municipality style, bustling with new start-up taxi and ride-share services, particularly those catering to seniors lacking mobility. If fuel is going to be scarce, we’ll have to learn to share.

In cities, villages and townships, the restriction against conducting a business from one’s home is a throwback to the heyday of the suburbs and the bedroom town, not at all adaptive to the coming era of declining fuel supplies. The zoning codes need to be rewritten so as to allow people to combine business pursuits with their living quarters, so as to provide stability and resilience in both the housing patterns, and the small-business sectors.

From the end of World War II, this bedroom town pattern has been okay with planners at local levels of government. It seemed to work well. Real estate salespeople and developers prospered. The landscape took on a kind of fairy tale look, with houses perched nicely atop kettle moraine landscapes, with gigantic lawns spread out before them. This was the era when employment was provided by giant corporations–many of which have completely pulled out of much of the United States and have relocated production entirely out of the country.

In the depths of the current recession, with 400,000+ people filing new unemployment claims each week, the outmoded dependency on large corporations to save our local economy stands out starkly. It is as if local governments were living in a fog of wishful thinking, magical thinking, eternal optimism based on “the way we were” back in the 1950s.

It is often said (way too often, in fact) that small business is the engine of economic growth, growth in the number of new livelihoods as people take risks and provide themselves their own job by starting up a new business. Yet zoning laws prohibit many people from starting up these businesses using their homefront as storefront. Perhaps the idea was that mixing business with bedroom town would lower the property values. The deflation of the housing bubble seems to have done much to lower property values, all on its own momentum.

In Stevens Point–and many other Portage County municipalities–you aren’t allowed to put a greenhouse in your yard, at your home. Anyone who might want to start a small-scale eco-agriculture business can’t do the startup from home. The zoning ordinances may have been written to protect larger-scale businesses against the threat of small-timers getting a foothold and perhaps contending on the basis of better quality or service or lower cost. Or, it would seem that would be one motivation for such zoning restrictions.

But if growing local food on a serious scale is considered, such restrictions have got to go. Green Giant is not going to be spearheading the local foods movement, I hope our business/govt. leaders realize.

As we approach an era when motor fuel is going to be absurdly expensive, and oftentimes, downright unavailable at any price (even absurdly expensive), it would seem prudent for our local government officials to start to get a handle on this peak oil issue. I attend any number of “sustainability”-oriented talks, film showings, forums, informal meetings, and whatnot, yet I never see Stevens Point City Council members, nor County Board members, at these sorts of events.

I take that to mean that these leaders don’t regard sustainability as an issue even deserving of their thoughtful attention, nor for engaging with other citizens in meaningful discussion about them. Perhaps it is because there’s been no executive leader guiding the overall direction?

Except, of course, for Patty Dreier, candidate for County Executive. That’s one more reason I’ll urge you to vote for her for County Exec. in the April elections.

Bobby G

Stevens Point WI

Posted in Biodiversity, Co-operation, Ecovillages, MicroEcoFarming, Peak Oil, Political Economy, Sustainability, ecology, subcultures | 2 Comments »

Ended, Tree Sit to Stop Mountaintop Removal Coal Mining

Saturday, January 30th, 2010

Friday, January 29th, 2010
posted by norag

Tree Sit Ends, Sitters Vow Not Over Until Blasting Stops
FOR IMMEDIATE RELEASE

Contact: 304-854-7372, news@climategroundzero.org
Note: For more info, see : www.climategroundzero.org, www.mountainjustice.org

January 29, 2010

PETTUS, WVa—After blocking Massey Energy’s operations on the Bee Tree Permit for nine days, Amber Nitchman, 19, and Eric Blevins, 28 descended from their respective trees. They had occupied the two oak trees—originally accompanied by a third tree sitter, David Aaron Smith, 23—to protest mountaintop removal and the blasting of Coal River Mountain. Upon descent, they were immediately arrested by West Virginia State Troopers. The sitters’ decision to leave the trees was made in light of the recent drop in temperature.

After a week of Massey security harassing the sitters with deafening sirens and air horns, acall-in pressure campaign was launched by Climate Ground Zero, Mountain Justice and other anti-mountaintop removal groups. The receipt of hundreds of calls from around the country led to an emergency meeting with Climate Ground Zero volunteers, the Raleigh County prosecutor and Governor Manchin. The meeting resulted in the moratorium and a call for aninvestigation of the abuse.

The tree sit represents Climate Ground Zero’s most sustained intervention in mountaintop removal mining operations since its campaign of nonviolent direct action began last February. Volunteers know that the fight is far from over and expect work to commence on the Bee Tree site immediately. However, they see this tree sit as a victory. “It halted blasting for nine days. I think they’ve wildly succeeded with their goals,” said Climate Ground Zero volunteer Mike Bowersox. In a final communication from her perch, Nitchman captured the group’s resolve. “Its not over until the blasting is stopped,” she said.

Posted in Economics, GeoEngineering, Political Economy, Sustainability, ecology, globalization | No Comments »

550 WSAU Radio: Voice for climate-change denial in central Wisc.

Wednesday, December 9th, 2009

Who’s polluting your mental environment?

If you’re wondering how trends such as the new surge in climate change “skepticism” or denial among the general public in the USA gather strength and become categorized as “groundswells” of public opinion by the mainstream media, it helps to look at the opinion shapers among the public. Here in central Wisconsin we have a very big, very loud opinion-shaping corporation, Midwest Communications, which uses its flagship news/talk-radio station 550 AM/99.9 FM WSAU (Wausau WI) to get out the message.

What is the message? Well, its not one message, but a list of messages (”talking points”) that goes something like this:

1. Man-made global climate change or global warming is a hoax, a fraud, at times a crime against the taxpayers, perpetrated by the liberals, by Algore, Obama, and a left-wing conspiracy of scientists paidby leftist liberals and the UN to say the things that the IPCC said.

2. The peak oil theory is a hoax, a fraud, another liberal conspiracy to force the USA to go backward, away from the path of endless growth fueled by fossil fuel. The liberals are hiding the truth that there is plenty of oil just waiting to flood the market if only US corporations were allowed to “drill, baby drill.” Conservatives just can’t swallow that M. King Hubbert was dead-on, and US oil production peaked in 1970, and will never return to its prior glory days.

3. The Tea Party movement is the true voice of conservatism. Mainstream Republicans are not to be trusted or supported, unless they are locked in political combat with the Obama administration or the liberals, in which case it’s okay to support them, but only as long as they remain pure. Meanwhile, listen for the next “Tea Party” coming to your town.

4. Obama and his adminstration are, at times, far left, or socialist, or Marxist, or even “Bolshevik” or “communist” if you listen late enough in the evening to catch Michael Savage’s angry show.

5. Obama is not a US citizen, and cannot provide a “long form copy” of his birth certificate. Yes, the “birther” movement is alive and well on WSAU.

6. Evolution is not “settled science” (just as climate change isn’t either), and it’s “just a theory” and creationism ought to at least be included as an “alternative theory” in school curricula, according to morning conservative host Pat Snyder.

7. The USA was founded as a Christian country, and all these people trying to separate the Christian church from state are undermining our country’s foundations. The Constitution is full of references to God and how the USA is really a Christian state. Go read it yourself, you’ll see, maybe.

8. The illegals from Mexico should be treated as the criminals they are, according to the morning show and the majority of its callers, plus all the talk shows that follow the morning show, including Rush Limbaugh, Sean Hannity, and of course, Michael Savage (Mr. “Borders-Language-Culture” by his own description). The fact that these folks are economic refugees from a failed state makes no impression, and compassion is not the order of the day on the Right.

9. The only Christians worth listening to, by the way, are right-wing Christians. Liberal religious groups such as Interfaith Community for the Earth are not even on the map as far as the editorial board of WSAU is concerned. One has to feel sympathy for the liberal morning host, Tom King, when the topic of religion is breached. Whatever his beliefs may be, he doesn’t cough and sneeze them all over the microphone, and is frequently lectured by Mr. Snyder regarding his lack of true Right Christian faith.’

There are numerous other talking points, but these are the main ones of late. There is a kind of seamless, scripted unity among the talking points from Pat Snyder in the morning, thru Limbaugh, Hannity, Savage, and Dennis Miller. A kind of corporate-oriented seamless unity. That is to say, those who own the globalized corporations would like it best if most Americans would share these beliefs.

Frequent guests on the morning talk show on WSAU (which has greatly increased its propagandizability radius with the addition of an FM transmitter in Rudolph near Wisc. Rapids) include Dr. Jerome Corsi (Mr. Swift-Boater, now advocating that Israel attack Iran immediately, if not sooner), members of “Americans for Prosperity” (founded by oil refining billionaire David H. Koch), frequent appearances by “pro-life” (but not anti-war) spokespeople (but never from reproductive freedom groups, NOW, NARAL, etc.), and occasionally Alex Jones of infowars.com. Judging from the line-up, I’d say that Tom King, their liberal co-host (who seems to play the role of making the station “fair and balanced” to fit the Fox News mold), has little input on guest selection.

Callers to the show are generally about 90% what you’d call conservative in opinion, and are generally in agreement with the conservative guests and with conservative co-host Pat Snyder. A considerable amount of fear-mongering ensues as the morning “Feedback” show winds its way through current events, the global warming hoax, the fact that Obama’s birth certificate has never been shown to the Right people, and so on. It’s an example of the “echo chamber” Balkanization of American civic life going on everywhere, 24/7. We don’t talk amongst ourselves now; we talk AT the other, we aim talk-darts at them, we talk past them, we talk over their head or under their knees, but we avoid genuine give-and-take in this new everyone-inside-the-box world.

You could say, if you don’t like this content, then just don’t tune in. Go listen to Wisconsin Public Radio or something. I listen to hear what local folks are thinking. Beyond the choice of content, also note that this is a station of record for things like school closings, and for fans of most of the sports teams in Wisconsin.

The morning show does allow some leaders of local not-for-profit and community groups to get the word out on their events and what their groups are doing. One wonders how the more liberal community groups must feel as their appearances are hosted by someone known to be hostile to their liberalism, and then to be on the playlist surrounded by such luminaries as Corsi and Limbaugh.

Advertisers need to advertise there, if they wish to reach that large market that the stations serve. Again, one wonders how they might feel as their adverts are sandwiched in among anti-immigrant rants by Michael Savage, or Rush Limbaugh calling Obama a socialist, or Pat Snyder ridiculing people who “believe in global warming”. (Oh, that’s right: 10. Morning host Snyder often calls global warming a “religion” so as to minimalize the issue to a point of being a matter of faith.) If you happen to know and do business with some of the local advertisers, maybe you can ask them how comfortable they are with this extremist-right message being associated with their products and services…

Without dragging out this blog entry any further, whatever part of the USA you happen to live, it’s worthwhile to know your local corporate propaganda outlet which reinforces these conservative messages. If you find your local Limbaugh or Glen Beck outlet, chances are the rest of the content is going to lean that’a way.

Then it won’t be so puzzling why large blocks of the population believe that climate change, peak oil, impoverishment of the working class, and similar issues are merely liberal “hoaxes.” The fact is that the public airwaves are bought-up by a small class of oligopolistic super-rich corporation owners who then resist what they see as the return of the commie “fairness doctrine” (a useless liberal reform if there ever was one). Fairness on radio? Don’t hold your breath.

Meanwhile, there are thousands of websites accurately covering Copenhagen, climate change, the science of carbon emissions, and everything you need to learn to be informed on this matter. Turn off your radio, start digging. Do your own due diligence. Question everybody, including me writing this blog.

B.G.

Posted in Economics, Peak Oil, Political Economy, Sustainability, ecology, globalization | No Comments »

Canada Farmers’ Union: Seed Modernization At What Cost?

Friday, March 13th, 2009

Excerpt from a recent presentation made by farmer Maureen Bostock, a National Farmer’s Union member from Ontario. A version of this presentation appeared in the Union Farmer (Spring 2009).

Seed Modernization At What Cost?

[The system (see *below)] which has served growers very well is to be dismantled in the government’s determination to replace protecting farmers with protecting corporate profits.

CFIA’s decision to make these changes to the Varietal Registration Framework is not a stand-alone policy; it is part of an economic strategy which has changed the world food order over the past few decades. It began with consolidation of the retail sector, vertically integrating the food chain from transportation, processing and retailing. Pesticide corporations followed suit and began to look for ways to control the agricultural production chain. They focused their attention on seeds when they realized that proprietary control of seeds and genetics could increase their profits. By attaching identity preservation, the value of seeds could be greatly increased. GE Terminator Technology has been developed to prevent unauthorized use of IP seeds. Seed and pesticide corporations began to lobby for governments to get out of seed production.

The Canadian government meanwhile has been pursuing its own agenda of privatization: the three D’s – downsizing, downloading and deregulation with the intention to free up the marketplace perfectly dovetails with industry’s goal to stop public breeding programs from competing with private industry.

The road to greater corporate profits requires both these fundamental changes –the elimination of competition from public breeding programs as well as the introduction of production contracts to secure profits.

For farmers, a future when contractual potato production becomes the norm, means both increased seed costs and the loss of the right to save potato seed year to year to replant.

Can farmers make a living if the cost of seed skyrockets? Let’s take a quick look at Canadian statistics:

While gross farm receipts have grown from $15,000 in 1926 to $150,000 in 2006, net incomes have dropped to $20,000 in the red. The cause of this disaster is the profits multinational corporations have given themselves permission to take in exchange for machinery, seed, feed, fuel, fertilizers, energy costs and bank interest. The combined profits of Agrium, Mosaic, Terra, Potash Corp and CF Industries rose from $100 million in 2002 to $1.2 billion in 2007. Potato prices have risen all of $18.05 per tonne since 1999. This is Canadian agriculture, where farmers lose money and corporations get richer.

There are other consequences to farmers if potatoes leave the arena of “public goods”. As potato seed increasingly becomes the property of corporations, the genetic diversity of potatoes may be threatened. With profit being the driving force rather than public interest, there is the potential for unconscionable disposal of genetic resources, such as the example of the corporation which sent to the landfill all but the most profitable seed in its warehouse upon the takeover of an international seed house.

Plant breeding was described by W.T. Bradnock, the director of Seeds Division of Ag Canada in the 1980s as resembling “the creation of a mosaic with contributions from different sources needed to complete the design.” Modern breeding programs tend to seek a single gene to provide resistance to disease. These products of vertical breeding have been found to convey short term resistance when compared to horizontal breeding programs, such as the work of the Loo family of PEI who selected Island Sunshine from varietal crosses which survived exposure to Late Blight. As we move closer to the day when IP potato varieties dominate the registry, we sacrifice the possibility of a broader genetic diversity.

To sum up then, it is suspect that a 30,000 ha seed crop such as potatoes is being accorded no more protection than the 10 ha of sunflowers. The loss of merit assessment combined with easing of deregistration will result in high-cost IP potatoes replacing older, proven varieties. Corporations achieve the cessation of public breeding programs competing with private while the federal government furthers its privatization initiative by moving closer to getting out of crop research and development altogether. When we ask who will benefit from the loss of pre-registration testing and merit assessment, it is all too clear that it will not be farmers.

* Canada’s public seed support consists of . . .19 experimental stations in Canada, one of which is the Potato Research Centre, employing 19 scientists and a total staff of 97. The Potato Research Centre has 18 potato releases in production across Canada and internationally, with the first commercial potato variety released in 1950. The Potato Research Centre conducts field trials on new potato varieties, collaborates with the International Potato Centre in Peru and other national breeding programs, conducts potato production studies in co-operation with provincial depts., universities & industry; and produces studies on erosion control, soil & water quality and land use on potato farms; as well as operates the Potato Gene Bank. As well, every January the Potato Research Centre offers 5 to 10 new varieties to growers of all size operations for the opportunity to do their own evaluations. (bolding mine-b).

Posted in Biodiversity, Economics, Genetic Modification, Peace, Political Economy, Sustainability, ecology, globalization | No Comments »

Guest commentary by Thomas Friedman: The “Great Disruption” has begun

Wednesday, March 11th, 2009

Usual talk these days is comparing our times to the “Great Depression.” It’s not as bad. It’s almost as bad. It’s worse. This is different, it’s a “Great Recession”. No, it’s different, it’s a “Greater Depression.” Stuff like that.

I like what Friedman says here, so I’m reprinting it: “Great Disruption.” Amen.

Bobby G.

The Inflection Is Near?
By THOMAS L. FRIEDMAN

Published: March 7, 2009

Sometimes the satirical newspaper The Onion is so right on, I can’t resist quoting from it. Consider this faux article from June 2005 about America’s addiction to Chinese exports:

Fred R. Conrad/The New York Times

Thomas L. Friedman

FENGHUA, China — Chen Hsien, an employee of Fenghua Ningbo Plastic Works Ltd., a plastics factory that manufactures lightweight household items for Western markets, expressed his disbelief Monday over the “sheer amount of shit Americans will buy. Often, when we’re assigned a new order for, say, ‘salad shooters,’ I will say to myself, ‘There’s no way that anyone will ever buy these.’ … One month later, we will receive an order for the same product, but three times the quantity. How can anyone have a need for such useless shit? I hear that Americans can buy anything they want, and I believe it, judging from the things I’ve made for them,” Chen said. “And I also hear that, when they no longer want an item, they simply throw it away. So wasteful and contemptible.”

Let’s today step out of the normal boundaries of analysis of our economic crisis and ask a radical question: What if the crisis of 2008 represents something much more fundamental than a deep recession? What if it’s telling us that the whole growth model we created over the last 50 years is simply unsustainable economically and ecologically and that 2008 was when we hit the wall — when Mother Nature and the market both said: “No more.”

We have created a system for growth that depended on our building more and more stores to sell more and more stuff made in more and more factories in China, powered by more and more coal that would cause more and more climate change but earn China more and more dollars to buy more and more U.S. T-bills so America would have more and more money to build more and more stores and sell more and more stuff that would employ more and more Chinese …

We can’t do this anymore.

“We created a way of raising standards of living that we can’t possibly pass on to our children,” said Joe Romm, a physicist and climate expert who writes the indispensable blog climateprogress.org. We have been getting rich by depleting all our natural stocks — water, hydrocarbons, forests, rivers, fish and arable land — and not by generating renewable flows.

“You can get this burst of wealth that we have created from this rapacious behavior,” added Romm. “But it has to collapse, unless adults stand up and say, ‘This is a Ponzi scheme. We have not generated real wealth, and we are destroying a livable climate …’ Real wealth is something you can pass on in a way that others can enjoy.”

Over a billion people today suffer from water scarcity; deforestation in the tropics destroys an area the size of Greece every year — more than 25 million acres; more than half of the world’s fisheries are over-fished or fished at their limit.

“Just as a few lonely economists warned us we were living beyond our financial means and overdrawing our financial assets, scientists are warning us that we’re living beyond our ecological means and overdrawing our natural assets,” argues Glenn Prickett, senior vice president at Conservation International. But, he cautioned, as environmentalists have pointed out: “Mother Nature doesn’t do bailouts.”

One of those who has been warning me of this for a long time is Paul Gilding, the Australian environmental business expert. He has a name for this moment — when both Mother Nature and Father Greed have hit the wall at once — “The Great Disruption.”

“We are taking a system operating past its capacity and driving it faster and harder,” he wrote me. “No matter how wonderful the system is, the laws of physics and biology still apply.” We must have growth, but we must grow in a different way. For starters, economies need to transition to the concept of net-zero, whereby buildings, cars, factories and homes are designed not only to generate as much energy as they use but to be infinitely recyclable in as many parts as possible. Let’s grow by creating flows rather than plundering more stocks.

Gilding says he’s actually an optimist. So am I. People are already using this economic slowdown to retool and reorient economies. Germany, Britain, China and the U.S. have all used stimulus bills to make huge new investments in clean power. South Korea’s new national paradigm for development is called: “Low carbon, green growth.” Who knew? People are realizing we need more than incremental changes — and we’re seeing the first stirrings of growth in smarter, more efficient, more responsible ways.

In the meantime, says Gilding, take notes: “When we look back, 2008 will be a momentous year in human history. Our children and grandchildren will ask us, ‘What was it like? What were you doing when it started to fall apart? What did you think? What did you do?’ Often in the middle of something momentous, we can’t see its significance. But for me there is no doubt: 2008 will be the marker — the year when ‘The Great Disruption’ began.”

Posted in Economics, Peace, Peak Oil, Political Economy, Sustainability, ecology, globalization, subcultures | No Comments »

2009: The Year that Industrial Agriculture Collapsed

Thursday, March 5th, 2009

By Bobby G. 5 March 2013 first posted in Akashic Records 5 March 2009

Speaking now from our hindsight vantage-point in 2013, before I lay out several recent articles, all somewhat long, detailing the crisis in agriculture which loomed in that year, 2009, I’ll say this. Finally, we begin to see the rapid-fire timeline that led us to the much -prophesized “end date” common to the Mayan Long Count Calendar, some predictive prophecy from the Vedic people’s tradition, as well as the “Timewave Zero” which Terence and Dennis McKenna supposedly discovered independently using the I Ching. Separately, Vinge, Kurzweil et al. had predicted a sort of orgy of technological radical human evolution they liked to call the “Technological Singularity” — also oddly enough pegged to the Maya Calendar date of 12/21/2012.

This 2012 thing really captured a lot of people’s attention. And well it should. I tended to conflate James Howard Kunstler’s snarky commentary together with the 2012 hoopla, while poking fun at the “technological singularity” I took to calling the pivotal date 12/21/2012 the “Clusterf**k Singularity.” Here’s how it plays out in the next 45 months:

2008 was the year the global banking system collapsed.

2009 was the year in which Totalitarian Agriculture finally collapsed, revealing its utter inability to feed the enormous global population, and the complete unsustainability that is essential to its existence as a system of human invention. (Articles below)

2010 was the year in which the fossil fuel energy system collapsed, strangely enough combining the peak of global oil production (”peak oil”) together with Richard Duncan’s “Olduvai Cliff.” Let’s just say that bad things really happened that year. It’s not one any of us want to revisit.

2011 brought on, early in the year, the complete collapse of the EurAmericAsian “military-industrial complex.” Warfare as a solution to unsustainability completely collapsed and unraveled. It ran out of funding, food, and energy. The entity known as the “nation-state” began its long sunset and disappearance as a plague from human history. It turned out, you could not kill every last “Islamic extremist” and “Jihadist” and in fact, those folks are now saddled with tremendous administrative burdens in those autonomous zones where they have the bad luck to be in charge. I wish them luck.

Which brings us to what happened in 2012. Industrial civilization devolved in an astonishing blink of an eye, historically speaking. We now, from our unfortunate vantage point in 2013, are faced with a world that is astonishingly ugly, ruined, completely dysfunctional, yet somehow we find hope in the task of rebuilding all this demolished shit from the ground up. I only hope we can preserve most of the extant species now remaining…

For now, let’s return to 2009, the year in which Totalitarian Agriculture met its demise.

First up, Bob Waldrop from Oklahoma Food Co-op dismissed James Howard Kunstler’s comments about the cause of the ag. crisis, which follows at the end of this interminable blog entry of mine.

Posted by: “Robert Waldrop”

Tue Mar 3, 2009 9:29 pm (PST)

I think Kunstler has it wrong about the impact of
our present financial crisis on farm country at
least for this year.

I am not hearing of any problems around here
regarding financing “at the farm level”. A lot of
credit provided for planting loans in the
conventional ag bidness comes from government
programs or is guaranteed by government programs
and that pipeline is still open. Crop insurance
also appears to still available. Conventional ag
hasn’t experienced a “credit bubble” over the last
decade the way the rest of the economy has. Ag
has already been there, done that, and gone
through several “collapses” over the last 30
years, so rural lenders to farmers have trended
towards “more conservative” than the pump and dump
$800,000 house in an exurb bidness.

The problems I am hearing about are mostly weather
related (Oklahoma has had a very dry winter, and
the winter wheat crop is suffering, indeed, we
need rain “soon” to have much of a crop this year
at all, see also “California Central Valley
Drought), in the CAFO system (high prices for
inputs), and at the “giant transnational
aggregator” level (e.g. financing for
international ag trade, the big transational
corporations like Archer Daniels Midland, etc). I
continue to hear a lot of anecdotes about CAFOs
(confined animal feeding operations) shutting down
suddenly.

Weather permitting, I think crops will be planted
and harvested this year. There sure could be
problems though in the supply chain relative to
the economic crisis. We could have a situation
where there is a lot of food at the rural
“gathering” spots like grain elevators and potato
warehouses, but bottlenecks getting it from there
to cities. In that situation, everyone from FEMA
to the National Guard might be mobilized to
transport field run foods into the cities, but
grain and soybeans while nourishing would be a
challenge for many urban families. Get your
printable flyer on how to improvise a grain
grinder and prepare soybeans while the internet is
still up!
http://www.energyco nservationinfo. org/printflyers. htm .

Speaking of drought, I have been planting peas and
potatoes and I should have been watering my mulch
this winter because not a lot of decomposition has
occurred at the ground level. So I bought an
organic fertilizer made here in Oklahoma, to go
with my Azomite (mineral dust, also a new tactic
this year) and the winter’s ashes from our wood
burning stove.

To return to farm credit, all bets are off for
next year. This year’s money is already in the
farm credit pipeline. We will see if the system
is able to do the same next year.

Bob Waldrop, OKC

Below is an update about the southern plains winter wheat crop, from today’s Oklahoma Farm Report. The news isn’t good. The issue this year is weather, not finance.

Bob Waldrop, OKC
http://oklahomafarmreport.com/wire/news/00593_Allendale_Wheat2009_213211.php
Another Verse of ‘How Dry We Are’ Being Sung- This Time by Joe Victor of Allendale~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Allendale Inc is well aware of the fact two of the top four US winter wheat producing state’s crop condition ratings are far less than desirable. Both Texas and Oklahoma are facing very dry conditions, with little chance of rain hitting wheat fields in either state in the immediate future.

Weather conditions and forecast are less than optimistic for the Southern Plains as two week forecasted temps suggest swings of more than 25 degrees which may promote heaving while the present drought monitor suggest more than periodic rains will be required to dig out of harsh conditions. Principle key winter wheat producing states of Kansas, Oklahoma, Washington and Texas have a degree of abnormally dry to severe drought.

Joe Victor with Allendale has assembled a one pager on the ramifications for the wheat market fundamentals- and we have the pdf file linked on our website. Clickon the link below to take a look at this work.
http://oklahomafarmreport.com/wire/news/media/00006_Wheat_Conditions_p030309.pdf

Catastrophic Fall in 2009 Global Food Production*****

By Eric deCarbonnel

After reading about the droughts in two major agricultural countries, China and Argentina, I decided to research the extent other food producing nations were also experiencing droughts. This project ended up taking a lot longer than I thought. 2009 looks to be a humanitarian disaster around much of the world

To understand the depth of the food Catastrophe that faces the world this year, consider the graphic below depicting countries by USD value of their agricultural output, as of 2006.

Now, consider the same graphic with the countries experiencing droughts highlighted.

The countries that make up two thirds of the world’s agricultural output are experiencing drought conditions. Whether you watch a video of the drought in China, Australia, Africa, South America, or the US, the scene will be the same: misery, ruined crop, and dying cattle.

China

The drought in Northern China, the worst in 50 years, is worsening, and summer harvest is now threatened. The area of affected crops has expanded to 161 million mu (was 141 million last week), and 4.37 million people and 2.1 million livestock are facing drinking water shortage. The scarcity of rain in some parts of the north and central provinces is the worst in recorded history.

The drought which started in November threatens over half the wheat crop in eight provinces – Hebei, Shanxi, Anhui, Jiangsu, Henan, Shandong, Shaanxi and Gansu.

Henan
China’s largest crop producing province, Henan, has issued the highest-level drought warning. Henan has received an average rainfall of 10.5 millimeters since November 2008, almost 80 percent less than in the same period in the previous years. The Henan drought, which began in November, is the most severe since 1951.

Anhui
Anhui Province issued a red drought alert, with more than 60 percent of the crops north of the Huaihe River plagued by a major drought.

Shanxi
Shanxi Province was put on orange drought alert on Jan. 21, with one million people and 160,000 heads of livestock are facing water shortage.

Jiangsu
Jiangsu province has already lost over one fifth of the wheat crops affected by drought. Local agricultural departments are diverting water from nearby rivers in an emergency effort to save the rest.

Hebei
Over 100 million cubic meters of water has been channeled in from outside the province to fight Hebei’s drought.

Shaanxi
1.34 million acres of crops across the bone-dry Shanxi province are affected by the worsening drought.

Shandong
Since last November, Shandong province has experienced 73 percent less rain than the same period in previous years, with little rainfall forecast for the future.

Relief efforts are under way. The Chinese government has allocated 86.7 billion yuan (about $12.69 billion) to drought-hit areas. Authorities have also resorted to cloud-seeding, and some areas received a sprinkling of rain after clouds were hit with 2,392 rockets and 409 cannon shells loaded with chemicals. However, there is a limit to what can be done in the face of such widespread water shortage.

As I have previously written, China is facing hyperinflation, and this record drought will make things worse. China produces 18% of the world’s grain each year.

Australia

Australia has been experiencing an unrelenting drought since 2004, and 41 percent of Australia’s agriculture continues to suffer from the worst drought in 117 years of record-keeping. The drought has been so severe that rivers stopped flowing, lakes turned toxic, and farmers abandoned their land in frustration:

A) The Murray River stopped flowing at its terminal point, and its mouth has closed up.
B) Australia’s lower lakes are evaporating, and they are now a meter (3.2 feet) below sea level. If these lakes evaporate any further, the soil and the mud system below the water is going to be exposed to the air. The mud will then acidify, releasing sulfuric acid and a whole range of heavy metals. After this occurs, those lower lake systems will essentially become a toxic swamp which will never be able to be recovered. The Australian government’s only options to prevent this are to allow salt water in, creating a dead sea, or to pray for rain.

For some reason, the debate over climate change is essentially over in Australia.

The United States

California
California is facing its worst drought in recorded history. The drought is predicted to be the most severe in modern times, worse than those in 1977 and 1991. Thousands of acres of row crops already have been fallowed, with more to follow. The snowpack in the Northern Sierra, home to some of the state’s most important reservoirs, proved to be just 49 percent of average. Water agencies throughout the state are scrambling to adopt conservation mandates.

Texas
The Texan drought is reaching historic proportion. Dry conditions near Austin and San Antonio have been exceeded only once before—the drought of 1917-18. 88 percent of Texas is experiencing abnormally dry conditions, and 18 percent of the state is in either extreme or exceptional drought conditions. The drought areas have been expanding almost every month. Conditions in Texas are so bad cattle are keeling over in parched pastures and dying. Lack of rainfall has left pastures barren, and cattle producers have resorted to feeding animals hay. Irreversible damage has been done to winter wheat crops in Texas. Both short and long-term forecasts don’t call for much rain at all, which means the Texas drought is set to get worse.

Augusta Region (Georgia, South Carolina, North Carolina)
The Augusta region has been suffering from a worsening two year drought. Augusta’s rainfall deficit is already approaching 2 inches so far in 2009, with January being the driest since 1989.

Florida
Florida has been hard hit by winter drought, damaging crops, and half of state is in some level of a drought.

La Niña likely to make matters worse
Enough water a couple of degrees cooler than normal has accumulated in the eastern part of the Pacific to create a La Niña, a weather pattern expected to linger until at least the spring. La Niña generally means dry weather for Southern states, which is exactly what the US doesn’t need right now.

South America

Argentina
The worst drought in half a century has turned Argentina’s once-fertile soil to dust and pushed the country into a state of emergency. Cow carcasses litter the prairie fields, and sun-scorched soy plants wither under the South American summer sun. Argentina’s food production is set to go down a minimum of 50 percent, maybe more. The country’s wheat yield for 2009 will be 8.7 million metric tons, down from 16.3 million in 2008. Concern with domestic shortages (domestic wheat consumption being approximately 6.7 million metric ton), Argentina has granted no new export applications since mid January.

Brazil
Brazil has cut its outlook for the crops and will do so again after assessing damage to plants from desiccation in drought-stricken regions. Brazil is the world’s second-biggest exporter of soybeans and third-largest for corn.

Brazil’s numbers for corn harvesting:

Harvested in 2008: 58.7 million tons
January 8 forecast: 52.3 million tons
February 6 forecast: 50.3 metric tons (optimistic)
Harvested in 2009: ???

Paraguay
Severe drought affecting Paraguay’s economy has pushed the government to declare agricultural emergency. Crops that have direct impact on cattle food are ruined, and the soy plantations have been almost totally lost in some areas.

Uruguay
Uruguay declared an “agriculture emergency” last month, due to the worst drought in decades which is threatening crops, livestock and the provision of fresh produce.
The a worsening drought is pushing up food and beverage costs causing Uruguay’s consumer prices to rise at the fastest annual pace in more than four years in January.

Bolivia
There hasn’t been a drop of rain in Bolivia in nearly a year. Cattle dying, crops ruined, etc…

Chile
The severe drought affecting Chile has caused an agricultural emergency in 50 rural districts, and large sectors of the economy are concerned about possible electricity rationing in March. The countries woes stem from the “La Niña” climate phenomenon which has over half of Chile dangling by a thread: persistently cold water in the Pacific ocean along with high atmospheric pressure are preventing rain-bearing fronts from entering central and southern areas of the country. As a result, the water levels at hydroelectric dams and other reservoirs are at all-time lows.

Horn of Africa

Africa faces food shortages and famine. Food production across the Horn of Africa has suffered because of the lack of rainfall. Also, half the agricultural soil has lost nutrients necessary to grow plant, and the declining soil fertility across Africa is exacerbating drought related crop losses.

Kenya
Kenya is the worst hit nation in the region, having been without rainfall for 18 months. Kenya needs to import food to bridge a shortfall and keep 10 million of its people from starvation. Kenya’s drought suffering neighbors will be of little help.

Tanzania
A poor harvest due to drought has prompted Tanzania to stop issuing food export permits. Tanzania has also intensified security at the border posts to monitor and prevent the export of food. There are 240,000 people in need of immediate relief food in Tanzania.

Burundi
Crops in the north of Burundi have withered, leaving the tiny East African country facing a severe food shortage

Uganda
Severe drought in northeastern Uganda’s Karamoja region has the left the country on the brink of a humanitarian catastrophe. The dry conditions and acute food shortages, which have left Karamoja near starvation, are unlikely to improve before October when the next harvest is due.

South Africa
South Africa faces a potential crop shortage after wheat farmers in the eastern part of the Free State grain belt said they were likely to produce their lowest crop in 30 years this year. South Africans are “extremely angry” that food prices continue to rise.

Other African nations suffering from drought in 2009 are: Malawi, Zambia, Swaziland, Somalia, Zimbabwe, Mozambique, Tunisia, Angola, and Ethiopia.

Middle East and Central Asia

The Middle East and Central Asia are suffering from the worst droughts in recent history, and food grain production has dropped to some of the lowest levels in decades. Total wheat production in the wider drought-affected region is currently estimated to have declined by at least 22 percent in 2009. Owing to the drought’s severity and region-wide scope, irrigation supplies from reservoirs, rivers, and groundwater have been critically reduced. Major reservoirs in Turkey, Iran, Iraq, and Syria are all at low levels requiring restrictions on usage. Given the severity of crop losses in the region, a major shortage of planting seed for the 2010 crop is expected.

Iraq
In Iraq during the winter grain growing period, there was essentially no measurable rainfall in many regions, and large swaths of rain-fed fields across northern Iraq simply went unplanted. These primarily rain-fed regions in northern Iraq are described as an agricultural disaster area this year, with wheat production falling 80-98 percent from normal levels. The USDA estimates total wheat production in Iraq in 2009 at 1.3 million tons, down 45 percent from last year.

Syria
Syria is experienced its worst drought in the past 18 years, and the USDA estimates total wheat production in Syria in 2009 at 2.0 million tons, down 50 percent from last year. Last summer, the taps ran dry in many neighborhoods of Damascus and residents of the capital city were forced to buy water on the black market. The severe lack of rain this winter has exacerbated the problem.

Afghanistan
Lack of rainfall has led Afghanistan to the worst drought conditions in the past 10 years. The USDA estimates 2008/09 wheat production in Afghanistan at 1.5 million tons, down 2.3 million or 60 percent from last year. Afghanistan normally produces 3.5-4.0 million tons of wheat annually.

Jordan
Jordan’s persistent drought has grown worse, with almost no rain falling on the kingdom this year. The Jordanian government has stopped pumping water to farms to preserve the water for drinking purposes.

Other Middle Eastern and Central Asian nations suffering from drought in 2009 are: The Palestinian Territories, Lebanon, Israel, Bangladesh, Myanmar, India, Tajikistan, Turkmenistan, Thailand, Nepal, Pakistan, Turkey, Kyrgyzstan, Uzbekistan, Cyprus, and Iran.

Lack of credit will worsen food shortage

A lack of credit for farmers curbed their ability to buy seeds and fertilizers in 2008/2009 and will limit production around the world. The effects of droughts worldwide will also be amplified by the smaller amount of seeds and fertilizers used to grow crops.

Low commodity prices will worsen food shortage

The low prices at the end of 2008 discouraged the planting of new crops in 2009. In Kansas for example, farmers seeded nine million acres, the smallest planting for half a century. Wheat plantings this year are down about 4 million acres across the US and about 1.1 million acres in Canada. So even discounting drought related losses, the US, Canada, and other food producing nations are facing lower agricultural output in 2009.

Europe will not make up for the food shortfall

Europe, the only big agricultural region relatively unaffected by drought, is set for a big drop in food production. Due to the combination of a late plantings, poorer soil conditions, reduced inputs, and light rainfall, Europe’s agricultural output is likely to fall by 10 to 15 percent.

Stocks of foodstuff are dangerously low

Low stocks of foodstuff make the world’s falling agriculture output particularly worrisome. The combined averaged of the ending stock levels of the major trading countries of Australia, Canada, United States, and the European Union have been declining steadily in the last few years:

2002-2005: 47.4 million tons
2007: 37.6 million tons
2008: 27.4 million tons

These inventory numbers are dangerously low, especially considering the horrifying possibility that China’s 60 million tons of grain reserves doesn’t actually exists.

Global food Catastrophe

The world is heading for a drop in agricultural production of 20 to 40 percent, depending on the severity and length of the current global droughts. Food producing nations are imposing food export restrictions. Food prices will soar, and, in poor countries with food deficits, millions will starve.

The deflation debate should end now

The droughts plaguing the world’s biggest agricultural regions should end the debate about deflation in 2009. The demand for agricultural commodities is relatively immune to developments in the business cycles (at least compared to that of energy or base metals), and, with a 20 to 40 percent decline in world production, already rising food prices are headed significantly higher.

In fact, agricultural commodities NEED to head higher and soon, to prevent even greater food shortages and famine. The price of wheat, corn, soybeans, etc must rise to a level which encourages the planting of every available acre with the best possible fertilizers. Otherwise, if food prices stay at their current levels, production will continue to fall, sentencing millions more to starvation.

Competitive currency appreciation

Some observers are anticipating “competitive currency devaluations” in addition to deflation for 2009 (nations devalue their currencies to help their export sector). The coming global food shortage makes this highly unlikely. Depreciating their currency in the current environment will produce the unwanted consequence of boosting exports—of food. Even with export restrictions like those in China, currency depreciation would cause the outflow of significant quantities of grain via the black market.

Instead of “competitive currency devaluations”, spiking food prices will likely cause competitive currency appreciation in 2009. Foreign exchange reserves exist for just this type of emergency. Central banks around the world will lower domestic food prices by either directly selling off their reserves to appreciate their currencies or by using them to purchase grain on the world market.

Appreciating a currency is the fastest way to control food inflation. A more valuable currency allows a nation to monopolize more global resources (ie: the overvalued dollar allows the US to consume 25% of the world’s oil despite having only 4% of the world’s population). If China were to selloff its US reserves, its enormous population would start sucking up the world’s food supply like the US has been doing with oil.

On the flip side, when a nation appreciates its currency and starts consuming more of the world’s resources, it leaves less for everyone else. So when china appreciates the yuan, food shortages worldwide will increase and prices everywhere else will jump upwards. As there is nothing that breeds social unrest like soaring food prices, nations around the world, from Russia, to the EU, to Saudi Arabia, to India, will sell off their foreign reserves to appreciate their currencies and reduce the cost of food imports. In response to this, China will sell even more of its reserves and so on. That is competitive currency appreciation.

When faced with competitive currency appreciation, you do NOT want to be the world’s reserve currency. The dollar is likely to do very poorly as central banks liquidate trillions in US holdings to buy food and appreciate their currencies

What Next?

James Howard Kunstler, Clusterfunk Nation, 2 March 2009.

Isn’t that a question, though….
The Peak Oil story was never about running out of oil. It was about the collapse of complex systems in a world economy faced by the prospect of no further oil-fueled growth. It was something of a shock to many that the first complex system to fail would be banking, but the process is obvious: no more growth means no more ability to pay interest on credit… end of story, as Tony Soprano used to say.
There was a popular theory among Peak Oilers the last decade that the world would enter a “bumpy plateau” period when the global economy would get beaten down by peak oil, would then revive as “demand destruction” drove down oil prices, and would be beaten down again as oil prices shot up in response — with serial repetitions of the cycle, each beat-down taking economies lower — the only imaginable outcome being some sort of quiet homeostasis. This scenario did not play out as expected. It was predicated on a mistaken assumption that all systems would retain some kind of operational resilience while ratcheting down. Anyway, the banking system was mortally wounded in the first go-round and the behemoth is dying hard.
The last desperate act of the banking system in the face of Peak Oil’s no-more-growth equation was to engineer species of tradable securities that could produce wealth out of thin air rather than productive activity. This was the alphabet soup of algorithm-derived frauds with vague and confounding names such as credit default swaps (CDSs), collateralized debt obligations (CDOs), structured investment vehicles (SIVs), and, of course, the basic filler, mortgage backed securities. The banking system is now choking to death on these delicacies.
The trouble is that the EMT squad brought in to rescue the banking system — that is, governments — can’t remove these obstructions from the patient’s craw. They don’t want to drown in a mighty upchuck of the alphabet soup.
The collapse of complex systems is actually predicated on the idea that the systems would mutually reinforce each other’s failures. This is now plain to see as the collapse of banking (that is, of both lending and debt service), has led to the collapse of commerce and manufacturing. The next systems to go will probably be farming, transportation, and the oil markets themselves (which constitute the system for allocating and distributing world energy resources). As these things seize up, the final system to go will be governance, at least at the highest levels.
If we’re really lucky, human affairs will eventually reorganize at a lower scale of activity, governance, civility, and economy. Every week, the failure to recognize the nature of our predicament thrusts us further into the uncharted territory of hardship. The task of government right now is not to prop up doomed systems at their current scales of failure, but to prepare the public to rebuild our systems at smaller scales.
The net effect of the failures in banking is that a lot of people have less money than they expected they would have a year ago. This is bad enough, given our habits and practices of modern life. But what happens when farming collapses? The prospect for that is closer than most of us might realize. The way we produce our food has been organized at a scale that has ruinous consequences, not least its addiction to capital. Now that banking is in collapse, capital will be extremely scarce. Nobody in the cities reads farm news, or listens to farm reports on the radio. Guess what, though: we are entering the planting season. It will be interesting to learn how many farmers “out there” in the Cheez Doodle belt are not able to secure loans for this year’s crop.
My guess is that the disorder in agriculture will be pretty severe this year, especially since some of the world’s most productive places — California, northern China, Argentina, the Australian grain belt — are caught in extremes of drought on top of capital shortages. If the US government is going to try to make remedial policy for anything, it better start with agriculture, to promote local, smaller-scaled farming using methods that are much less dependent on oil byproducts and capital injections.
This will, of course, require a re-allocation of lands suitable for growing food. Our real estate market mechanisms could conceivably enable this to happen, but not without a coherent consensus that it is imperative to do so. If agri-business as currently practiced doesn’t founder on capital shortages, it will surely collapse on disruptions in the oil markets. President Obama at least made a start in the right direction by proposing to eliminate further subsidies to farmers above the $250,000 level. But the situation is really more acute. Surely the US Department of Agriculture already knows about it, but the public may not be interested until the shelves in the Piggly-Wiggly are bare — and then, of course, they’ll go apeshit.
The recent huge drop in oil prices has left the public once again convinced that the world is drowning in oil — if only the scoundrelly oil companies were forced to deliver it at reasonable prices. The public has been consistently deluded about this for decades. What’s missing so far is for the president of the US to lay out the reality of the situation in a dedicated TV address. I know a lot of you think that Jimmy Carter already tried this and failed to make an impression (and ruined his presidency in the process). I guarantee you that Mr. Obama will have to do this sometime in the next few years whether he likes or not, and he’d be well-advised to get it done sooner rather than later. And by this I don’t mean just vague allusions to “energy independence” or “renewables” in speeches devoted to many other issues. I mean telling the public the plain truth that we’ll never offset oil depletion and the intelligent response is to do everything possible to transition to walkable towns and public transit, not to sustain the unsustainable.
The alternatives — i.e. what we’re trying now — is to further delude ourselves into thinking that we can run WalMart and the suburbs by some other means than oil. Despite all our investments in these things, we won’t be able to run them by other means, and the news about this had better get out before enormous disappointment turns into titanic rage. If Americans think they’ve been grifted by Goldman Sachs and Bernie Madoff, wait until they find out what a swindle the so-called “American Dream” of suburban life turns out to be.
On this blizzardy Monday in the power centers of America, attention is fixed on the never-ending fiasco of AIG — a company whose main product turned out to be credit default swaps, and is now choking on them. Kibitzers on the sidelines of finance are forecasting a king-hell bear market suckers’ rally in the stock markets followed by a belly flop to Dow 4000 or lower. I myself called for Dow 4000 two years ago — and was obviously a bit off on my timing. All this is surely trouble enough. But while your attention is focused on Rick Santelli in the Chicago trader’s pit, or Larry Kudlow desperately seeking “mustard seeds” of new growth in financials, try to let one eye stray to the horizon where these other complex systems are working out their next moves. Farming. The oil markets. These are the coming theaters of alarm and distress.

Posted in Co-operation, Economics, Ecovillages, Peace, Peak Oil, Political Economy, Sustainability, ecology, globalization | No Comments »

“Drill here, drill now?” not so much…

Friday, October 10th, 2008

I ripped this off the financial newswires. As we have noted here before, there won’t be much “drilling here, drilling now, or paying less”going forward in the face of this continued death spiral in the equity markets. Oil exploration budgets are being cut as fast as the value of 401(k)s all of a sudden. “Peak money” seems to now be driving peak oil.
You can mentally fast-forward three or four years when the next major gap between global hydrocarbon supply and global hydrocarbon demand is “discovered” again. To correct such a shortfall you don’t just drill several thousand 20,000- 40,000-foot depth oil or gas wells in a few weeks using equipment that never got built because it was deemed unneeded.

A good question to be asking in your local study circles: How can our region cut its BTU consumption by, say, half or two-thirds in the next three to five years? How can we quickly insulate our local economy [village, township, city, county] from the next energy shocks? And do so in a very tight money environment…
Bobby G,

Central Exposure, Wisconsin USA

—————————
ANALYSIS-US energy firms to cut spending as crisis spreads
Tuesday 10/07/2008 1:37 PM ET – Xinhua Financial News
Related Companies
Symbol Last %Chg
CHK 22.40 -15.47%
HK 12.15 -13.77%
PXP 21.70 -12.57%
SD 12.54 -14.87%
As of 4:06 PM ET 10/7/08
The number of U.S. independent energy companies cutting exploration
budgets is expected to grow as the global credit crisis worsens,
especially among those smaller natural gas firms that have outspent
cash flow to fund their growth.
A 50 percent drop in natural gas futures from summer highs has
prompted companies like Chesapeake Energy Corp, Petrohawk Energy Corp,
Plains Exploration & Production Co, SandRidge Energy Inc and
PetroQuest Energy Inc to cut back on capital spending.
But now as the global financial crisis reaches deeper into the energy
sector, others are expected to cut their exploration budgets,
especially small-to-medium sized companies and those that have large
debt loads.
“Uncertainty around both commodity prices and credit availability
could play a significant role in the capital budgeting process for
next year,” Jeffrey Robertson, energy analyst with Barclays Capital,
said in a note to clients on Monday. “We expect others may follow in
an effort to preserve financial flexibility.”
Quicksilver Resources Inc is one growth-oriented company with cash
flow deficits that will likely cut its capital spending, Robertson
told his clients.
Companies with the weakest positions based on cash flow estimates,
liquidity and expected expenditures include Venoco Inc, ATP Oil & Gas
Corp, Quicksilver and Bill Barrett Corp, according to Barclays.
In fact it may be impossible for the U.S. exploration and production
sector to spend more than cash flows in 2009, or at least for the next
few quarters, analysts at Tudor, Pickering Holt & Co. Securities Inc
wrote on Tuesday.
BIGGER IS BETTER
Higher up the food chain, larger independents like Devon Energy Corp
and major oil companies like Exxon Mobil Corp so far have been seen as
safer from the financial markets fallout because they have plenty of
cash on hand and are much less vulnerable to swings in commodity
prices, analysts said.
In one example, Anadarko Petroleum Corp on Tuesday said it had paid
down some debt and had $1.9 billion in cash at the end of the third
quarter.
Even if more companies cut their exploration budgets, investors would
not need to worry too much because it would eventually lead to a
reduction in U.S. natural gas supply, said Mike Breard, senior energy
analyst with Hodges Capital Management.
“The market is self-correcting,” Breard said. “If people cut back on
drilling expenditures, then gas prices are eventually going to go back
up.”
Companies that planned to sell assets as a means of raising capital
may also run into trouble as the credit crisis shuts down sources of
financing for buyers.
“Overall the pace of exploration and production mergers and
acquisition activity — well off its 2005-2006 peak levels — should
further slow, due in part to the scarcity of financing,” Raymond James
said in a note to clients on Monday.
Producers have been actively shopping assets — especially those with
marginal rates of return — as a means of funding spending, but some
of those properties have not found buyers, the analysts said.

Posted in Economics, Peak Oil, Political Economy, Sustainability, ecology, globalization | No Comments »

Stevens Point: The Big Build-Out Begins

Friday, May 9th, 2008

This week, The Big Build-Out was green-lighted in this small city. I see where Cathy Dugan was one of the few voices from the wilderness, along with Reid Rocheleau and another apartment owner, speaking against Stevens Point creating a Tax Increment Finance (TIF) district for the big corporate welfare plan to aid AIG Corp. putting up its big building in the industrial park east of the freeway. I feel somewhat guilty for not going down there and adding my voice to the few last opponents of the coming Big Build-Out in Stevens Point.

It’s no wonder that activists burn out in this area. Being the lone voice or two speaking out against what you see as wrongheaded development, more of the same business-as-usual with a smiley green face put on it, being greeted with either derision or just stoney silence, has got to wear on people after a while. It looks like we’re bound to be a monopole, a one-party town (Dems) for the next decade or more, playing the economic development game “the way it’s played now” as the Development Director would say. (As far as I know, caving in to corporate demands and giving concessions is the way the economic development “game” has been played for decade after decade; nothing new there.)

We also know that monopoles don’t last long; eventually two poles again emerge, and struggle begins anew. So there may be hope, a decade or more hence, for another look at wrestling with the peak oil problem and a less energy-intensive way of life. Of course, by then, we should be about 120 months into the global decline of oil production, so we’ll be well behind most other small cities in catching up to the cacophony of events transpiring then.

What is the rationale for why this TIF is so fiscally responsible for Stevens Point? It’s the “spin-off development,” of course.

In days gone by, people used to complain about the kind of spin-off development that the Big Build-Out will spin off. It was disparagingly called “Urban Sprawl.”

Now that Stevens Point will become an “eco-municipality,” no one would dare call “urban sprawl” all that spin-off development of hastily-built shopping plazas, convenience stores, restaurants, music venues (to create a “night-time economy” out there in Downtown #2), more large big-box stores, and of course, hundreds of new apartment units. They’ll be L.E.E.D. buildings! And all of the myriad services this Build-Out will demand of the city and surrounding county townships and municipalities? They’ll be paid for by escalating property assessments and rising property taxes. Somehow, the housing bubble will remain un-deflated in our area!

I’m suggesting a new term we could coin for the Big Build-Out: “Eco-newsprawlapality.” What do you think, could it catch on? In this brave new construction zone, the peaking of global oil production is still decades away, not an imminent threat, and the prospect of a sprawling small city utterly dependent upon the automobile seems to bother no one, not even the greenest of green activists. Except perhaps the few folks with enough gumption such as Cathy Dugan and Council member Amy Heart displayed, to speak out when they smell something fishy in the works.