thinkingstring.com

A response to Dave Hampton’s excellent and thoughtful case for the “YES” argument.

Its important I think to not confuse the causal relationship that exists between the electorate and elected, and the very real need for the latter to use the power that they uniquely wield to make structural changes to the workings of the society in which we live.

We can debate the degree to which the elected are influenced by the actions of the constituency, both on polling day and on all the other days in between. Days the people may choose to spend not in comfortable pursuit of middle-class distractions but rather in a passionate expression of their belief for governmental or corporate action and change.

We can debate who wags whom and where the ultimate power to influence the view of reality that both the politicians and the people hold – I would argue that the media super-barons have at least one cheek ensconced on the throne of power with their proven ability to make or break a candidate’s aspirations, their demonstrated willingness to take sides on an issue, and their role as lenses of the world and its priorities for most citizens.

But what we ought not debate, and what we should accept as pragmatism is that as long as we accept that the sole answer to avoiding catastrophic levels of environmental degradation is for individuals to make personal and non binding pledges of action then the chances of our ultimate success are slim. That is not to say that we should just be sitting by, wondering why things aren’t the way we’d like to find them to be. It is important for us to take an active role in building the world we wish to live in. We get the world we make.

It is a simple recognition of reality that achieving the 80-90% emissions cuts that climate scientists advise are necessary requires changes to the system. Never mind dealing with the other pressing environmental issues we face such as water supply, land degradation, and the genocide of species.

To achieve emissions cuts of that magnitude then no less than transport choices, electricity generation and distribution methods, urban planning, construction methods and materials, and what food we eat must all be addressed. The reality is while a minority may care enough about an issue to make personal pledges, and to stick to them, the vast majority will go with the flow.

I may pledge to walk or cycle, but on a cold, wet and windy day most people just think I am an idiot. Or worse; someone with no money or no aspirations. I may elect to have a staycation, but in the time I have taken to type this much eight jumbo passenger planes have passed through my view on their descent to Heathrow.

As long as the default choice is the status quo with regards to housing, transport, energy supply and food supplies, locked in a behavioural framework where success is defined by a larger house, a larger car and ideally one that is endorsed by Top Gear, more overseas holidays and more consumption of throwaway stuff, then the reality is that the majority will blindly follow those choices. Meanwhile, developing nations and the next generation – those who will inhabit the world we deliver to them are being educated to aspire to repeat our mistakes, locking us into another thirty years heading in an unsustainable direction.

The premise of making personal pledges is to recognise that the status quo is broken and that the default sets of choices have something wrong with them. That is entirely a good thing – the more people who lift their eyes from the motoring or travel lift out of their paper and take a moment to think “Is it a good and worthwhile decision in the grander scheme of things that I fly the family to Florida so that the kids can eat popcorn and ride a roller coaster at Disney Land?” the better. However we do not have the timeframe available to us now to allow us to hold minority choices to be the strategic answer that will lead to ultimate success.

We need systemic changes that deliver default choices to the majority so that without pledges or other conscious action on their behalf their ecological footprint is sustainable. The power to deliver those changes lies not in the hands of a minority of average private citizens, no matter how vocal, passionate and committed they are. It lies in the hands of those making the macro financial and legislative structures that shape the world we live in.

Debate we can on how to best achieve the attention and action amongst our elected leaders. However it is to be pragmatic to recognise that success lies not in a minority swimming against the stream, it lies in changing the course of the river. Ten thousand people could sit in peaceful protest in Heathrow’s terminals tomorrow, but until the system stops classifying their actions as illegal, until the media brands them not as “Enemies of the economy” but rather “National heroes”, and until the majority of public opinion has some degree of empathy for their actions it will all be just a blip soon lost in time and significance as the status quo resumes.

We do not have time for the luxury of optimism. We have time only for bold thinking enabled through pragmatic execution. The time for despair may yet come, but it is not upon us yet as we are still “this side” of the historical record; a record that will document whether we lived through the age of stupidity or the age of grand deliverance.

The debate, if you can call it that, in the US over health care system reform is a truly bizarre spectacle, and one that is an abject lesson in how to distract an argument away from the core subject being discussed.

The indisputable fact is that approximately 40,000,000 people in the US cannot afford access to basic health care services. By “basic” I refer not to agonising decision over whether to have nipple enhancement or not while you’re in to get your breasts done. No…by ‘basic’ I mean services like non cosmetic dental care, A&E care, blood pressure and cholesterol diagnosis and treatment, diabetes diagnosis and treatment, natal care, and services to repair all the wear and tear experienced during the average first 18 years of life. The bottom line here is that the current system, the status quo, is structured such that 40 million mothers, fathers, grandparents, sons and daughters have zero ability to pay for services to fix health problems that are chronically painful and perhaps life threatening. With no “health care net” available either “no ability to pay” translates into “zero access”.

To reiterate what is an important and fundamental point. The current population of the UK is approximately 60 million people. If 40 million people in the UK were similarly effectively blocked from access to health care then two thirds of the population could not go to the dentist or doctor ever. The current population of Australia is 21 million - so if you deported all the doctors, nurses and dentists from Australia and closed all the hospitals and clinics you’d still only be halfway to denying 40 million people basic health care services.

Meanwhile, for the other 260 million or so Americans who do have access to health care, services and treatments are eye poppingly expensive. However, be careful your eye doesn’t pop too far out as it may not covered by the health insurance scheme provided by your employer - which is shelling out an estimated US$12,000 per employee per annum to pay for that insurance (providing insurance for the employee and up to 3 dependants). That’s US$12,000 more that could be paid directly to the employee as wages if the employer did not structurally have to cover the health insurance costs. If you think twelve thousand bucks is chicken feed, it is worth remembering that that figure is the about the US minimum wage - though it is also worth remembering that if you were an employee actually on minimum wages, it is unlikely that your employer would also be providing health insurance making you perhaps one of those 40 million people unfamiliar with the inside of a doctor’s waiting room.

This author speaks from experience with regards to the platinum coated pricing schemes of US health care as we had a son born in New York state during the family’s four year tenure in the USA. It is worth providing a short summary of those costs to provide perspective:
- total time mother/son spent in a hospital: 12 hours (the minimum time before you’re allowed to check out after giving birth)
- total time doctor spent in room: 60 seconds (to sign a form)
- nursing staff: 1 “in and out” with the majority of nursing provided by self funded midwife
- drugs and other interventions: zero (yes you read that right; no drugs, no interventions)
- use of “machines that bleep”: zero
- use of ambulance or similar: zero

In short - you would struggle to describe a birth experience that required less support from neo-natal services other than a home birth.

Total cost: just shy of US$8000; with the employer provided insurance paying for 90% and leaving us with a 10% or US$800 deductible. Just what was worth eight thousand dollars of medical treatment remains a mystery to this day.

Meanwhile the US is ranked by the WHO in almost all indicators, except for cancer survival rates, far below Oman, Morroco and Colombia, as well as the UK, France, Germany (just keep listing other major European and Scandinavian countries here), and Australia. The USA ranks 37th.

To summarise: the US has a health care system today that under-delivers against important key performance indicators (infant mortality, average life span etc), is eye wateringly expensive for those treatments it does provide, and leaves 40,000,000 people with zero health care. Oh, and by the way the status quo is projected to bankrupt the country entirely as it will fail to scale further as the populations increases and ages.

The debate therefore ought to be a simple one - does the US maintain this status quo, or does it seek to reform health care in such a way as to drastically improve the USA’s WHO rankings , provide basic services universally, and reduce the overall costs to prevent budgetary collapse.

However that isn’t the debate that is taking place. The debate that is taking place is over whether the provision of universal health care is “socialist” (translation: pinko subversise communist), and whether fantastical death panels will rule over the worth of Grandma’s life (Sarah Palin says she can see the Death Panels from her medicine cabinet). Take these two distracting and emotive topics, add a little dash of Glenn Beck to the aforementioned Salt of Palin and you’ve just hijacked what was a needed and sensible debate, and you’ve turned it instead into a roiling mess of argument that churns onward and achieves nothing. Or more accurately, it achieves the maintenance of the status quo.

Which brings us naturally to the topic of peak oil (this as my old friend George Watt would say, is a “neat little seque”). The connection here is twofold and less tenuous than you might think. Firstly, oil provides the energy that enables modern health care. Secondly, and more directly relevant to the main point here is that the debate over the timing of peak oil has been allowed to overshadow the necessary debate over the future of (petroleum based) energy prices.

The truth of the matter is that we will only definitively know when global oil supplies have peaked once we’re well down the slope of decline. Far enough down perhaps to have put behind us a few (more) instances of supply having insufficient scope of growth to meet real demand. There is much evidence to suggest that we’re already basically at the peak point, or just beyond. However arguing this point tends to just around in circles. It is very easy for peak-deniers to point to the status quo and argue that “Providers report significant reserves as they have in the past. They didn’t stop pumping last year. So they won’t stop pumping this year. And anyway, we can just drill a few more holes in the Alaskan tundra if we need more.” Such drill-baby-drill responses are the peak-oil equivalent of the pinko-communist-death-panel responses in the US healthcare debate. The main purpose, intentional or otherwise, is to maintain the direction and rate of the status quo and delay or prevent structural change and improvement.

The real discussion that needs to be taking place concerning oil is whether cheap oil will continue to be available. “Cheap” is of course a relative term. Ignoring for a moment that (not insignificant) fact of the infamous US$147 p/bl price peak, by “cheap” means “the median price of oil over the period during which it has fuelled the development and growth of the current economic model.” Furthermore, given that the maintenance of the social/economic/world-balance-of-power status quo relies on the oil price remaining somewhat near that median price, what are the implications for the economic decisions that are made countless times every day, that are based on the price of oil?

The outlook is such that it is almost certain, on balance, that anything but the status quo will result. For example, OPEC has for some time now called for a price range of between US$70 and US$80 p/bl as being the minimum that can support the necessary infrastructure and exploration investments required to maintain supply levels. Shell CEO Jeroen van der Veer stated in June of this year that “(All this) points to new price spikes and volatility further down the road.” The same Kuala Lumpur hosted Asian Oil and Gas conference heard BP CEO Tony Hayward state that a target price of US$60 to $80 p/bl is also in BP’s sights in order to pay for required investments.

A per barrel target price of between US$70 and $80 p/bl is a very interesting one for a number of reasons.

For a start, it represents the upward slope of prices for petroleum and oil-derived products (fertilizer and plastics feed stocks) that are felt downstream by consumers and industry. The Wall Street Journal reports that petroleum prices as a percentage of disposable income more than doubled between 1981 and 2008. This is enough to change consumer behaviour, and certainly enough to alter the balance of cost calculations for heavily oil dependent industries.

Secondly, it is worth looking at the 2006 study performed by the US Department of Commerce titled “Macroeconomic and Industrial Effects Of Higher Oil and Natural Gas Prices”. The D.O.C. study was designed to predict the effects on the US economy (and by extrapolation all other developed economies) of an oil price that is maintained in the range of US$70.00 to $80 p/bl for two years or more. Not surprisingly, the study found depressive effects on GDP, industrial output, consumer disposable income levels and more. All other things being equal such a price would also result in an additional 500,000 people becoming unemployed due to cross sector job losses, compared to an oil price range in the US$50 to $60 p/bl range.

Those resulting changes occur for a very simple reason: as oil prices increase (and therefore the prices of products derived directly and indirectly from oil increase) the decisions made by individuals whether acting as individual consumers or in their capacity as business decision makers changes too. Spend less, invest elsewhere, carry less employees, locate and manufacture elsewhere. Scaling upwards to the strategic and structural as oil prices continue to go upward from US70+ we eventually reach a point where airlines downsize and go out of business en masse, and where commuters desert their SUVs and catch a train or a bus instead. Jeff Rubin, former Chief Economist of CIBC Worldmarkets is quoted as saying “I think we’ll see a return to triple digit prices (per barrel oil prices) very early into an economic recovery”. His book titled “Why Your World is About to Get a Whole Lot Smaller: What the Price of Oil Means for the Way We Live” is worth a read as a basic outline of his thinking.

This therefore is the discussion we ought to be having - how do we achieve a soft landing for society as oil prices increase, and the associated economic decisions are reworked? Sure, there are clearly some, like Mr. Rubin who are sounding the drum. However the majority of individual and corporate decision makers continue with the assumption that energy prices will remain roughly in line with those enjoyed during the past 50 years, and that therefore the same structural economic system will continue. All the rest have either not noticed at all, or have been distracted by the circular debate regarding peak oil.

All of which is a segue if I ever seen one. And a sick one at that.

What isn’t surprising is that America hammered home a ground stake yesterday at the G8 Summit with the declaration that they will commit to an 80% reduction in GHG emissions, achieved by 2050. The idea that the Obama administration would take such a direction crystallised on the evening of October 2nd, 2008 in St. Louis Illinois.

On that evening the then Alaskan Governor Sarah Palin and the current Vice President Joe Biden primped, positioned and even occasionally answered a question during the Vice Presidential (nominee) televised debate. Biden, in response to a question regarding the causes of climate change responded; “It’s man made, it’s clearly man-made. That’s why the polar ice caps are melting”.

For those paying attention, this was a watershed moment – remembering that every answer given in that debate must have been subject to intense preparatory deliberation by an expert team of policy setters and massagers of messaging. Biden’s answer unequivocally nailed a sign on the wall pointing to the direction the administration would take. Here we are, some nine months later, and the bright spark Biden gave voice to that night has gestated in the G8 announcement.

And yet, like a newborn child, there is both an infinity of possibility and the great potential for tragedy all wrapped up in the same bundle. The G8 announcement, designed to spur developing countries like China and India into making similarly far reaching commitments, is problematic in that it fails to set aggressive commitments for interim emissions targets. Climate scientists would like to see developed nations achieve 50% emissions cuts by 2020, on the way to the overall 80% cuts three decades later. The announcement also courted controversy for the failure to concretely specify the baseline year against which relative targets are calculated – “OK…I’ll cut 80%. 80% of what though?” So…dramatic progress, but the devil remains in the details.

If the announcement isn’t a complete surprise then, is there anything that is? There’s certainly no surprise in the fact that 99% of the western world will get up today and do exactly the same things that they did yesterday, even if they read the newspaper headlines regarding the announcement as they crunch through their morning bowl of cereal. They’ll eat the same food, use the same transport method to get to work or drop little Mary-Jane and Muhammad at the local school, and book the same holiday destination regardless. An infinitesimal number of people will internalise the news and begin to think how their lives might be different if conducted such that they generate only 20% (or less, depending on the baseline year) of emissions than they do today.

Similarly, business leaders will generally have the same meetings they otherwise would have had. Focussing not on the method by which they may achieve profitable operations with 80% less emissions, but instead on this quarter and this year. Product Managers, Vice Presidents of Futurology and other foretellers of the future will spend the day dreaming up two-dot-oh this and three-dot-oh that, mashed up, twittered and iPhone ready for all. Ministers of Education, School Principals and Teachers will pull out the same textbooks and all give no thought as to how to enable the room full of fresh-faced 9 year olds with an education suitable to successfully progress and contribute to an economic model that is undergoing a fundamental shift throughout the duration of their future working lives. The 9 year olds of today are the 50 year olds of 2050. They are generation of Emissions Transitioners – the Digital Immigrants of the carbon-down age. Their lives will be defined not by the rhetoric of the 2009 G8 Summit, but by the continued action of many throughout the coming forty years.

Perhaps the surprise then, if there is any, is simply the degree to which the minutia of planning necessary to actually enact structural change has thus far failed to materialise. To have the head and the mouthpiece of the dog bark is one thing, but to have the body react requires specific directions to be sent to the nerves and muscles that initiate and coordinate action. It is high time that detailed consideration is given to how change will be achieved and successfully guided and governed along the way.

Clearly the necessary structures to accommodate and encourage change remain illusive – preceding the G8 announcement by just a few days was the news that an ambitious plan to generate 4,000 megawatts of wind farm electricity in the USA was being mothballed. The project was cancelled, according to the chairman of BP Capital Management due to fact that “transmission issues and the problem with the capital markets make (the scheme) unfeasible at this point”. The country that does achieve such a plan for renewable energy generation and distribution will be the first to lay claim to the pole position in the rankings of countries decoupled from the pollution, profit, violence and warfare associated with oil production in many parts of the world.

A high game of brinkmanship therefore continues to be played amongst the world’s leaders. At stake is nothing less than the shape of the geopolitical stage and the economic ordering of the winners and losers in the “green economy”. Mixed in amongst that is the question of what sort of everyday opportunities and decisions will be available to everyone alive today who is 45 years of age or less – for we are the generations of transitional action. L’Aquila may rumble with the aftershocks of tectonic discontent, but it is the aftershocks from the 80% announcement that will rumble far longer and with far more potential reach.

The concept of “peak oil” remains a touch too uncomfortable for most. Too close to being “big conspiracy”, too far from the everyday, and the implications too far reaching for the idea to sit comfortably in the repertoire of the polite dinner party conversationalist. Religion, politics, and peak oil to be avoided at all costs - best to stick to something safe and controversial like whether its OK or not to build a duck house at the taxpayer’s expense.

Only there are some interesting indicators pointing to the fact that in many ways, we’re already beyond the peak point. Here’s a list of indicators, which can be handily printed off, kept to hand, and ticked off the list as each occurs:

- the price of oil increases by a significant margin in a short period of time. Say, doubles within the space of 6 months. Its important that such price increases are not aberrations related to factors such as short term political instability in a producing country, or a war, extreme weather event, buy-side price manipulation and so on.
- the target price talked up by the various oil ministers of the major producers is even higher still, with the justification being that such a relatively high price is required “in order to fund the required infrastructural investments necessary to maintain supply”.
- the target price that OPEC et al aim for is within the range deemed by the USA’s Department of Commerce to be dampening (all other things being equal) on the US economy. Indeed, in this 2006 study the Department predicted significant downward GDP pressures, unemployment, and a slowdown in manufacturing sector output resulting from oil prices in the $70 to $80 range.
- vehicle manufacturers that have ignored fuel efficiency in their ranges struggle to sell their models as consumers become more sensitive to oil price.
- major oil consuming businesses like airlines post significantly poor results citing high oil prices as a major catalyst for their poor trading results.

So lets compare that to today’s reality:
- oil price has doubled so far in 2009 and is currently in the high $60 pbl range (hitting a $66 high Friday last)
- the target price is in the $70 to $80 range. OPEC Secretary-General Abdullah al-Badri has called for oil to hit that range by the end of 2009. Other OPEC ministers, including Ali al-Naimi of Saudi Arabia saying “the world was ready to cope with oil at $75-$80 and that it could reach that level before the end of the year.”
- GM has shed $50B of shareholder value in the last decade and will roll into Chapter 11 bankruptcy faster and more predictably than a Chevy Tahoe drinks Texas Tea.
- British Airways as one example posted a “worst ever loss” of £401M after being hit with a fuel bill just shy of£3B. The weak pound and the drop in passenger numbers as a result of trimmed travel budgets (itself a result of the recession) didn’t help at all. In the lead up to the loss it was reported that “Costs far outstripped revenues of just under £9bn due to high fuel prices”

So this is what it looks like - we’ll know where at the point of peak oil not when the unaudited reserves of Ghawar are finally shown to be a sham, but rather when the economic indicators “downstream” of the depletion point exhibit the market behaviours associated with sensitivity to the resulting high oil prices. Because at that point the level of actual reserves is somewhat academic, and we’re dealing with the reality of the actual price point.

Interestingly, the Department of Commerce itself states that “Over the long-run it is possible for the economy to adjust to the higher prices of energy imports by improving its energy efficiency, finding alternative sources of energy, or searching out additional supplies of energy. ”

So the bright lining is that investment in alternative energy sources, and also in fuel consumption efficiency ought to be accelerating.

Henry David Thoreau said, “We are double-edged blades, and every time we whet our virtue the return stroke straps our vice”.

And so it is with technology and the energy supply model underlying it. What wonders the profligate use of petroleum based fuels and coal has brought to mankind over the last century. Borrowing profusely from the energy stores of the past has allowed us to break free from the limits otherwise placed on us, had we needed to continue relying solely on plant based energy sources for fuel, and animals (and human slaves) and the occasional use of wind, water and gravity for motion. Supporting as it has the major technology innovation driven macro economic cycles of the 20th century we must recognise that even our current plans (such as they are) to move to widespread use of renewables for electricity supply would not be possible without the construction and technology innovations fuelled by the petro industry.

Our current perilous state is the end result of two human failings.

Firstly, we have treated as an externality the economic and environmental cost of the pollution generated through burning coal and petro fuels. The treatment of pollution as an externality is not just a problem of human behaviour; it is clearly also a systemic failure of market fundamentals, and one that must be addressed even as we seek a way out of the current global economic unravelling.

Secondly, we have failed to plan sufficiently for the eventual and entirely logical decline in the availability of oil supplies. The extent to which we have collectively found it convenient to ignore the clarion calls regarding the peaking of oil supplies is breathtaking.

Yet here we are; facing the environmental unravelling that results from a century of spewing greenhouse gases into the atmosphere, the collapse of the market systems as a result of self deception as their true operational nature, together with the real likelihood that peak oil is a “now” not a “later”. You couldn’t plan that nexus better if you were the scriptwriter for a Hollywood disaster movie.

While the irony of our current problems should not escape us the technology that it has allowed us to develop might however provide the means for us to avoid some of the worst of the potential resulting scenarios. It may be argued that in the long term (meaning: really long term) human society needs to evolve to an entirely different model (and why not - we have seen already in human history the existence of several different models that have been effective in their day, given the needs and limits of the time). However in the short to medium term we must recognise that we cannot simply stop doing every activity that is currently performed and that in this new reality is recognised to have an unacceptably large ecological footprint. To attempt to do so would be far too disruptive of the current social order to be acceptable. Instead, we must use technology in different ways in order to provide low GHG emission alternatives to current heavy GHG emission ways of working and living.

Of all of the changes we must make, the two areas that will require technology-supported alternatives to most desperately are travel and electricity supply, and they are in fact linked.

Lets first look at travel. The four most common forms of polluting travel are (road based) vehicular, sea-borne bulk carriers, air, and rail. Which is worse is a moot point as far as progressing the discussions along in the short term, especially given the debate over the actual impact of jet propelled, high altitude flight. For simplicity’s sake it is worth assuming that they’re all bad, and they will all need to be drastically curtailed and/or re-engineered if they are to remain viable.

Sea-borne bulk carriers are the easiest to deal with, so lets get that topic out of the way first. The easiest way of avoiding pollution resulting from an activity is to not perform the activity in the first place. The vast majority of bulk carriers are either carrying crude or refined petrochemicals or derived products or coal; raw or semi refined minerals; components that are destined to used somewhere else as part of a highly distributed supply chain; or completed manufactured goods. The shipping of petro products and coal in bulk will clearly decline anyway as we remove these products as primary energy supply sources. Highly distributed and long tail supply chains look increasingly unviable when we recognise those costs that are currently treated as economic externalities, and in doing so account for those costs in the price of the resulting product and service. Already companies are beginning to re-examine their supply chains in light of GHG emissions, and work is underway to further refine the Scope 3 calculations of the GHG Protocol by the World Resource Institute in order to provide further clarity regarding the details of supply chain reporting. In a similar fashion, we can expect a reduction in long distance shipping of manufactured products, especially as the embodied footprint of such products is more commonly calculated, reported, and as a result priced in to the product. In such a scenario a locally produced product will become more desirable than an equivalent product manufactured remotely. The accounting for the pollution resulting from the fuelling of the remaining shipping movements will naturally encourage a re-examination of nuclear driven ships, and the use of wind power.

Rail meanwhile needs to be powered by either clean sources of electricity, or through acceptable bio-fuels. These same two energy sources are also required for road based vehicular transport. We must however get much smarter in our use of technology if we are to make rail transport again acceptable as a common form of mass human transport. Currently rail journeys are more often than not an exercise in frustration, uncoordinated as they are with bus services, and with the thicket of overlapping rail service providers that has resulted from privatisation of the rail network in many countries. Successfully getting from A to B via rail services is an unnecessarily complex wrestle with numerous timetables, ticketing systems, and interchanges - none of which have seen much effort to simplify. It needn’t be so. If we made the same effort toward taking the friction out of rail transport as we have to making car travel easier and more enjoyable we would go a long way toward making mass rail services far more attractive as a form of human transport. Coordinated web based services for timetables and ticketing is a start. Telecommunications based services to enable information to be readily available to travellers is also required - why can we buy a GPS mapper for a vehicle for $100 but can’t be similarly helped to navigate from one train to another or from train to bus to address. Location based services must be extended to encourage commuters out of their vehicles and onto public transport. Meanwhile, we must also look to move much of the bulk transport of goods off the roads and back onto the rails. The decline of the use of rail as a viable bulk material transport method is illogical, should be reversed, and will certainly become more attractive as road carriage costs are internalised into the economic model.

Road travel in its current form will only continue if fuelled by either acceptable bio-fuels or clean electricity. It is likely however, and perhaps desirable in the greater scheme of things if we also achieve a drastic reduction in the overall use of cars as a form of transport. It is important to recognise that we have managed to engineer into society an unnecessary reliance on vehicular travel. Urban design must be rebalanced such that the use of a car is not required for much of everyday living. It is illogical that we have decimated the economy of the local shops through the adoption of huge shopping centres for which we have no alternative but to drive to in order to use. There is much talk today by the USA’s Obama administration regarding the links between Wall Street and Main Street. The reality is that the death of Main Street (or the High Street if you’re in the UK) has more to do with this engineering out of local economic resilience as it has to do with the failures and corruption of the banking and finance markets.

Removing cars from the road will however also require us to provide technology-based alternatives to many activities. For a start, telecommuting must be made more common and far easier. This will require many changes and the provision of enabling services, not least of which will be the provision of secure broadband services to everyone. In fact, high speed communication links are perhaps the most important enabler of change if we are to at all engineer our way out of both the problems of climate change and those presented by peak oil.

And what of “clean electricity” supplies? Aside from altering the fuel stocks used for generation, away from coal and natural gas and toward renewables, the most important change we must make will be a fundamental change in the energy generation and distribution model. In order to engineer the required resilience into a smart grid system we must move from the highly centralised and concentrated generation model that we have today, and move to a highly fragmented and widely distributed micro-generation model. Such a network will have a dynamic and rich mix of renewable generation sources as well as tapping into the stored energy sources that are parked (electric) vehicles and the like. Successfully achieving a resilient and balanced power supply that supports both baseload as well as peak demands will require co-ordination of the supply and demand “nodes” as well as the grid that connects them. This co-ordination is what is meant by the term “smart grid”. Telecommunications infrastructure is again the enabler, providing the means to monitor and manage the various consumptive or contributory nodes.

That just leaves us with the little problem of air travel. Simply put, even if we develop an acceptable source of biofuels the days of mass air travel are rapidly drawing to a close. All the highly publicised experiments by various airlines in the use of biofuels are nothing more than a distraction and a con. Airline travel will be severely curtailed. Humanity may eventually get used to that - keeping in mind the fact that for all the protestations to the contrary by holiday makers and airline executives the reality is that international and domestic long distance travel is something that we have only recently managed to fall so deeply in love with. Those same airline executives as well as the forty-something holidaymaker would do well to be reminded that as recently as their own childhood humanity managed to do quite OK without racking up half a million air-miles each per annum. Again however we must face the reality of the short term, and again telecommunications must step up to meet the demands now built into our personal and business structures of behaviour. Telepresence enabled communications provides a useful alternative for the business executive, and with the right investment may even provide some acceptable alternatives to flying around the world in order to have Christmas dinner with that distant relative whom you didn’t really like all that much anyway.

Telecommunications therefore is perhaps a great saviour in many ways as we re-engineer our current personal, working and industrial models. However there is also one more role it needs to play - that of helping us to accurately account for the embodied ecological footprint of the goods and services we consume. As the embodied footprint of a product is linked to the distance that we transport it and the mode by which we transport it, location based services will increasingly be relied upon in order to accurately account for that travel. We must become far more aware than we are today of the complex shifting back and forth of products that takes place before they reach their final consumption point.

All that remains is for us to find the will to move forward. A reasonable question might also be to ask whether our various telecommunications providers have the vision and the strategy to play a role in delivering the infrastructure and services we will need from them. Lets continue to shout the demand down the phone line to them, and hope for more than confused static in return.

Every parent learns the trick of reverse psychology. Its cheap, its unsophisticated, but heh….whatever works.

Those doubting the USA’s new-found passion for driving an economic reconnaissance on the back of a “green” agenda will find a strong suggestion for the new Obama administrations resolve in the unlikely grounds of an Iraqi complex for orphans in Tikrit. It comes in the form of a 2.5 metre long statue of a shoe. Sculptor Laith al-Amiri masterpiece is a lovingly crafted replica of one of the shoes hurled at Ex-President Bush by journalist Muntadhir al-Zaidi in Baghdad.

That act, and the monument it has inspired represents more than anything how low the opinion of the USA has fallen to amongst a larger proportion of the Arab (oil bearing) world. They have lost leadership not just economically, but also inspirationally, morally, and industrially. But here’s the most important thing and also why any of this is relevant to the “sustainability” story: The Obama administration are keenly aware of the existence and magnitude of that loss. And it is worth emphasising that the Obama administrations newly minted existence itself is also a reflection of the same awareness of that fact too, amongst the majority of the electorate. It is a sure thing that the Whitehouse staff have little enough time on their hands right now to be minutely following the fibreglassing and metalwork career of al-Amiri. It’s also pretty much guaranteed to be true that the thought of a monument to the execution of the most heinous insult an Arab can give being a final symbol of the US’s impact on Iraq would be an unwelcome one.

That keen awareness of America’s down and nearly out position on the world-stage is however transforming into a spirited and forceful turnaround. Like the turning manoeuvre of an ocean liner it is going to take time to set the economy off in a new direction and to stoke the boilers back from their currently sputtering and hissing state. However once turned and sailing their wake will influence the direction and pace of others.

Obama is pointing toward the US’s future - “Green Industry”. Environmentalists are rightly sceptical of our collective ability to engineer our way away from catastrophic climate change. With that reality check in mind, have no doubt that from an economic point of view that “green innovation” will be the underlying technology engine driving the next macro economic wave around the world.

The Obama Whitehouse will do everything to make sure that the US gets a big slice of that wallet. They will do everything they can to ensure that the US position is back to where they feel it should be - one of dominance on the world political and economic stages. You don’t have to like that, but you do have to recognise it.

And if they ever feel that someone else is nipping at the heels of the pace of their innovation and investment efforts, they need only to look to an orphanage in Tikrit to get the necessary boot up their behinds.

We are have been geared to measure progress by how much growth has been achieved. Has the economy grown or contracted this year? Has output risen and have profits increased year over year? Have we earned more this year than last year? Have we manufactured more widgets, cleared more acres of land, mined more, made more, sold more? More…More…More…More…

Sharemarkets swiftly and harshly punish companies that fail to deliver an endless cycle of growth, while we need look no further than the front pages of our newspapers to understand the corporate and personal fear that results from a succession of quarters in which our overall economy fails to expand. It should be obvious however that expansion cannot however be infinite. There must indeed come a time when the resources that are needed as inputs to the system become short in supply and hence high in cost.

There must come a time when the market is saturated. There must come a time when the growth cannot be sustained in a sensible manner.

We’re there.

The interesting question is…where do we now go from here?

The answer is that we need a different target for success, and a new way of measuring success. Rather than a constant growth state economy (CGSE) we must instead develop and recognise the value of a Steady State Economic (SSE) model. Many will decry this as impossible, improbable, irrational, or even worse “downright disproven, socialist commune speak”. It is after all easy to point to the natural world and declare that “growth is the natural state of things”, and furthermore it is the proven way of successful human social and economic behaviour.

The reality is that the natural state involves both growth phases and balanced steady states. A single tree may grow, bud and be the genesis for an entire forest. However eventually the forest will reach a balanced state, once it has reached the edges of the resource boundaries available to it. At that point the net growth of flora and fauna within the forest ceases for the most part though there can be no denying that within that same forest an incredible richness of change and activity continues. The over expansion of any one element is generally counterbalanced by the emergence of a settling force that ensures the system is kept in check. Opportunities for individual growth and success continue - a steady state model is demonstrably still an active model rather than a static one.

We too are governed by that same reality. We have managed to skirt that only by the trick of externalising the full environment impact of our activities and thus by the sleight of hand of ignoring them as factors in our economic equations we have convinced ourselves that they are at worst irrelevant and at best non existent. AGW is nothing more than the debt of the long ignored externalities having reached a point where they are bursting back out from under the rug where we have too long swept them. Nothing more….and a whole lot more too.

Meanwhile, we must now recognise that one of the fundamental changes we must push through is one of systemic performance measurement. Businesses, individuals and State economies must recognise the inherent value of the “steady state”. This will require no small degree of re-evaluation in how we set targets, reward success, measure performance and encourage desirable action. Lowering the “per unit” ecological footprint of anything produced by business isn’t enough, if the gross output of the business is expected to infinitely rise. Only recognising that a steady state model is actually not only desirable, but also one modelled on the normal course of events in the world will create the necessary formula for truly sustainable economic and human activity.