Tuesday, April 12, 2005
James Wolcott has been on a particularly morose kick lately, what with the end of the world as we know it breathing down his neck. After noting the dour summation of the market as seen through the eyes of Buffett, Volker, and Templeton ("nothing worth buying", "disturbing trends", "more negative information than meets the eye"), he sez:
"There's a pattern here. As with Peak Oil, global warming, the real estate bubble, and the various US deficits, there's a general awareness of Trouble Coming and yet no sense of urgency or battle plan. It isn't that the media, the political class, and the media (sic) are paralyzed by fear or overwhelmed by alternative solutions, it's as if everyone is assuming that we can sleepwalk through the next crisis and muddle through as we always have with only minor hiccups, if any, in our lifestyles. As Stephen Roach and others have warned, the American consumer is now so indebted and lacking in savings that there's little cushion for the next reversal of fortune. Almost any soft landing could turn hard."It's not that I'm such a financial groupie. But I like to keep my ear to the ground. Say I just hate surprises. I've been expecting a housing bubble to burst in the next couple years, and I don't doubt we may end up with a whole new underclass (Deltas? Gammas? God, forbid, Epsilons?!) after Bush has his way with our economy. But it's been a long, long time (art school, maybe?) since I felt the cold fingers of paranoia around my throat the way I did after I read this happy piece, via Wolcott, in Rolling Stone by James Howard Kunstler:
"A few weeks ago, the price of oil ratcheted above fifty-five dollars a barrel, which is about twenty dollars a barrel more than a year ago. The next day, the oil story was buried on page six of the New York Times business section. Apparently, the price of oil is not considered significant news, even when it goes up five bucks a barrel in the span of ten days. That same day, the stock market shot up more than a hundred points because, CNN said, government data showed no signs of inflation. Note to clueless nation: Call planet Earth...Kunstler goes on to explain that 2005 is the year we will probably experience the "global oil-production peak", when the world will produce the most oil it will ever be able to in a given year, after which its production will only go down. He then ticks off the list of implications for our oil-based economy and the ubiquitous petroleum-based goods we produce and use, the reason gas is going to be just as expensive, the reason hydrogen and other alternative fuels won't be practical, the likelihood of wars, the fall of the suburbs, and the return to an agrarian economy where those who hold land and grow food will become the aristocracy:
It has been very hard for Americans -- lost in dark raptures of nonstop infotainment, recreational shopping and compulsive motoring -- to make sense of the gathering forces that will fundamentally alter the terms of everyday life in our technological society. Even after the terrorist attacks of 9/11, America is still sleepwalking into the future. I call this coming time the Long Emergency."
"The relentless subdividing of land in the late twentieth century has destroyed the contiguity and integrity of the rural landscape in most places. The process of readjustment is apt to be disorderly and improvisational. Food production will necessarily be much more labor-intensive than it has been for decades. We can anticipate the re-formation of a native-born American farm-laboring class. It will be composed largely of the aforementioned economic losers who had to relinquish their grip on the American dream. These masses of disentitled people may enter into quasi-feudal social relations with those who own land in exchange for food and physical security. But their sense of grievance will remain fresh, and if mistreated they may simply seize that land."Good God, people! Does the fun never end? The full monty can be read in Kunstler's book, The Long Emergency, when it's released. If, like me, you're a bit on the sensitive side, you may want to dust off those old dreams of moving to B.C. and starting a commune on 50 acres. The Mother Earth News is still out there, droogies.