Author: Rob Mielcarski

By Nick Lane: Why is life the way it is?

Nick Lane, my favorite science writer, recently gave an updated version of his talk on the origin of life and why life is the way it is. This talk summarizes his most recent book “The Vital Question” which I reviewed here.

The big ideas are:

  • The emergence of life is probable and simple single-cell life, like bacteria, is probably common throughout the universe.
  • Complex life, like plants and animals, resulted from a one-time “accident” 2 billion years ago, and will be rare in the universe.
  • Increased energy played a key role in the emergence of complex life, as it does for human domination of the planet.

When you layer on top of this Varki’s theory, which explains the improbable singular emergence of the powerful human brain, our existence and its ability to understand this paragraph, becomes something to revere and protect.

The tragic irony is that we are not fighting to protect our special place in the universe because of the same mutation that enabled the emergence of our brain: denial of reality.

By Tim Morgan: A World Economy Snapshot

Another brilliant must read essay by Tim Morgan. There is not one economist in a thousand that understands the relationship between energy and wealth, and yet it’s the most important thing required to understand our economy today.

Think about it. How can it be that well-educated intelligent experts understand everything except obvious facts that imply bad news?  Nothing other than inherited denial can explain this powerful and destructive human behavior.

https://surplusenergyeconomics.wordpress.com/2017/02/16/87-a-world-economy-snapshot/

World trend ECoE is estimated at 7.8% in 2015 – up from 6.4% in 2010 – and is projected to rise to 10.0% by 2021. The latter corresponds to an EROEI of just 9:1 which, if you understand EROEI, spells very big trouble. ECoEs are already high enough to help explain why the world economy is now stuck in “secular stagnation”.

ECoE is best understood as an economic rent. It is a “cost”, but not in the conventional sense of that word because, of course, no money actually leaves the system. Rather, a rising ECoE compels us to spend more on energy and, therefore, less on everything else.

This shows up most obviously in household budgets as a rise in the cost of essentials, which leaves the individual or household less to spend on everything else. Again taking Britain as an example, the cost of household essentials rose by 48% between 2006 and 2016, far outstripping much smaller increases in wages (+21%) and general CPI inflation (+25%). At the level of national economies, much the same occurs, with the cost of essentials outpacing both income and broad inflation as ECoE increases.

This is one reason why seemingly-positive data on the economy as a whole increasingly clashes with individual experience – the data says the economy is growing, but the individual feels poorer, not wealthier. An increasing ECoE – and its transmission through the cost of essentials – helps explain this apparent contradiction. As neither conventional economics nor governments understand this mechanism, policymakers find themselves baffled by trends which do not seem to accord with the data available to them.

So global GDP increased by an aggregate of $20.1tn in the ten years culminating in 2015. But, as you will also see, world debt increased by far more – $76.5tn – over the same period. This means that, aggregated over a trailing ten-year (T10Y) period, $3.81 was borrowed for each $1 of reported growth in GDP.

Obviously, this trajectory is not sustainable – over ten years, economic growth of 22% was far exceeded by an increase of 45% in debt. If the projected increase of $23tn in GDP between 2015 and 2021 happens, and is accompanied by borrowing at the same ratio as the T10Y number (of $3.81 per growth dollar), debt would increase by $87tn, or 36%, over that period.

Ominously, the T10Y measure has been rising steadily – back in 2010, the T10Y ratio was only $2.84 of borrowing for each growth dollar. Even at the $3.81 multiple, however, the ratio of world debt-to-GDP would rise from 216% to 244% – and even this number requires acceptance that reported GDP numbers are an accurate reflection of underlying output.

It seems pretty clear that the enormous rate of borrowing in recent years has flattered GDP by creating “growth” that is really no more than the spending of borrowed money. This, of course, brings forward consumption at the cost of increased liabilities in the future.

On this basis, underlying world GDP in 2015 was $95tn, 17% below the reported $114tn. Just as important, trend growth is far lower when measured on an underlying basis, where world economic output is growing at about 1.2% annually.

This figure is nowhere near a consensus in the range 3-4%. That consensus rate of growth may be deliverable – but only if we carry on spending borrowed money.

A world in denial

Logically, the practice of inflating GDP by spending borrowed money cannot continue indefinitely. This is not a “new normal”, but a “new abnormal”. Most obviously, the aggregate amount of debt is rising much more rapidly than economic output, making the debt burden ever harder to support. Since the global financial crisis (GFC) of 2008, the economy has only managed to co-exist with this debt mountain at all thanks to the slashing of interest rates to near-zero levels.

ZIRP (meaning “zero interest rate policy”) has its own costs, some of which are only now gaining recognition. Savers have suffered very seriously from monetary policies designed to keep borrowers afloat, which, perhaps, is why the concept of “moral hazard” seems to have fallen out of the vocabulary. Last summer, after the most recent cut in interest rates, the deficit in British pension funds rose to £945bn, more than 50% of GDP, and evidence of pension value destruction has emerged on a worldwide basis. Ultra-cheap money keeps afloat businesses which in normal times would have gone under, creating space for new, vibrant enterprises – so the necessary process of “creative destruction” has been stymied by monetary manipulation.

In short, we are living in an unsustainable “never-never-land”, in which cheap debt both misrepresents and undermines real economic performance.

By Jim White: Weather & Climate Summit 2017

Jim White gives some of the easiest to understand and most enlightening talks on climate change. Here is an excellent recent talk with a big picture view of what’s going on and what to expect in the future.

A few points he made stuck with me:

  • Are humans significant enough to affect the climate? Yes!
    • We move 10 times more dirt than all natural erosion processes.
    • We make more nitrogen fertilizer than all bacteria on land.
    • We make more sulfate than all ocean phytoplankton.
  • A nasty dilemma
    • the planet cannot support everyone at 1st world lifestyles
    • low income = middle income/3.5 = high income/7
  • We have no room left to grow:
    • we cultivate all good farm land
    • we use all available surface water and augment with pumped groundwater
  • Despite deforestation there is more biomass today than in the 1800’s due to human CO2 and fertilizer.
  • We cannot grow away climate change because there is much more carbon in remaining fossil energy than all biomass.
  • Why worry about 1C warming?
    • max temperature swing over last 40 million years was 10C
    • +2C = 5m sea level rise
    • +4C = 80m sea level rise
  • Keep an eye on the Arctic. When the ice is gone we will see dramatic changes in weather.
  • Climate change is an inter-generational problem. Our grandchildren will have to deal with the consequences of our behavior today.
  • We say we love our children but we do not show it.
  • Population must be controlled (he’s right but his fatally flawed solution is to increase the wealth of women which will increase CO2 emissions)

Here’s another very good talk by Jim White that I previously posted:

https://un-denial.com/2014/12/19/by-jim-white-abrupt-climate-change-past-present-and-future/

By Steve St. Angelo: The Blood Bath Continues in the U.S. Major Oil Industry

top-3-us-oil-companies-free-cash-flow-minus-dividends-2011-2016

https://srsroccoreport.com/the-blood-bath-continues-in-the-u-s-major-oil-industry/

The carnage continues in the U.S. major oil industry as they sink further and further in the RED.  The top three U.S. oil companies, whose profits were once the envy of the energy sector, are now forced to borrow money to pay dividends or capital expenditures.  The financial situation at ExxonMobil, Chevron and ConocoPhillips has become so dreadful, their total long-term debt surged 25% in just the past year.

However, the rapidly falling oil price, since the latter part of 2014, totally gutted the profits at these top oil producers.  In just five short years, ExxonMobil’s net income declined to $7.8 billion, Chevron reported its first $460 million loss while ConocoPhillips shaved another $3.6 billion off its bottom line in 2016.  Thus, the combined net income of these three oil companies in 2016 totaled $3.7 billion versus $80.4 billion in 2011.

The combined CAPEX spending from these three oil companies fell 29% in 2016 versus 2015 and 46% since 2013.   Basically, ExxonMobil, Chevron and ConocoPhillips have cut their combined CAPEX spending in half in the past three years.  This is bad news for either building or at least maintaining oil production in the future.

Here we can see that the large dividend payouts by these three oil companies impacted their bottom line much worse than the figures shown in the Free Cash Flow chart above.  Thus, the free cash flow minus dividend payouts provides us evidence that these oil companies have been seriously in the RED since 2013, not just the past two years displayed in the Free Cash Flow chart.

As we can see, the group’s free cash flow minus dividends was a negative $32.8 billion in 2015 and a negative $29 billion last year.  Of course, these three companies may have sold some financial investments or assets to reduce these negative values, but a company can’t stay in business for long by selling assets that it would need to use to produce oil in the future.

When these three companies still enjoyed positive free cash flow in 2011 and 2012, after paying CAPEX and dividends, their long-term debt did not increase.  However, as their operating profits really started to decline, the debt on their balance sheets increased significantly.  As we can see, the combined long-term debt in these three companies balance sheets ballooned from $40.8 billion in 2012 to $95.7 billion in 2016.

Tribes Trump Reality: War is Probable

About 100,000 years ago a small tribe of hominids experienced a rare double mutation for an extended theory of mind plus denial of reality, which switched having a more powerful brain from being a reproductive fitness disadvantage into a strong advantage, thus enabling the mutations to fix in the gene pool. That species then used its unique brain to take over the planet and to grow itself into a severe state of overshoot.

This first and only extended theory of mind to emerge in a brain increased the effectiveness of social cooperation through improved morality, communication, planning, and the invention and transmission of new technologies.

The denial of reality mutation was required to mute the awareness of mortality and its negative impact on reproductive fitness that the extended theory of mind enabled. The inherited denial of mortality caused each tribe to create a life after death story. Over time these stories were elaborated into what we now call religions (and political parties) which serve to define, unite, govern, and entertain tribes.

The tribe with its story was and is central to the success of the species. For most of history it mattered not whether the story was true. Today the survival of the species has bumped up against the laws of physics and truth does matter. This is a wicked predicament because tribes can’t easily change their stories, and inherited denial of reality tends to block unpleasant truths from being added to the stories.

Today we have two angry bickering tribes within the most powerful country on earth. Each tribe comprises about 50% of the population. Neither tribe has a story grounded in reality or truth. Each thinks the other is the cause of the very real thermodynamically based pain it is experiencing. Neither understands what is going on. Inherited denial of reality blocks each from learning what is going on.

The best and perhaps only method for uniting and distracting these two tribes would be to identify a third tribe as a threat. Fighting that third tribe will unfortunately accelerate the depletion of low-cost oil which caused the pain in the first place. So it may be necessary to identify a fourth tribe as a threat. And so on.

This will probably not end well.

By Tim Morgan: In Pursuit of Safety

This is an appropriate follow-up to my post on Trump being a symptom rather than a cause.

Tim Morgan does a very nice job here of explaining why citizens have good reason to be angry, and why our leaders do not understand and are surprised by the anger.

Morgan concludes the essay by saying the best path forward would be for the elites to break through their inherited denial of reality, except he is probably not aware of Varki’s theory and therefore does not use these terms.

https://surplusenergyeconomics.wordpress.com/2017/02/05/86-in-pursuit-of-safety/

A key point made here is that the economy is a great deal weaker than conventional data suggests, which in turn makes public dissatisfaction that much more understandable.

Though other issues are involved, the main cause of public dissatisfaction is widespread economic hardship, set alongside the conspicuous flaunting of wealth and power by a privileged minority. Economists who seem baffled by the weak performance of the world economy would be even more baffled if they were aware of what is really happening behind the published numbers.

Over the decade to 2015, official figures imply a 1.8% rate of compound growth, a figure which includes the post-2008 downturn and which, the consensus says, is likely to rise to an annual growth rate of between 3% and 4% going forward. Both of these readings are fallacious, because they take as reality GDP numbers inflated by the spending of borrowed money.

Given that almost $4 has been borrowed for each $1 of growth, you could be forgiven for supposing that, over an extended period, there has been no “real” growth at all. This is likely to be an exaggeration, but not much of one. Stripped of debt-fuelled consumption, growth in world GDP between 2005 and 2015 was probably about $7.6tn (rather than the reported $20tn), and trend growth may have been as low as 0.5% over that period as a whole. This, of course, includes the post-2008 recession, and current underlying growth is probably about 1.5%.

On this basis, world GDP in 2015 was probably nearer $94tn than the reported $114tn, which would make the global debt-to-GDP ratio about 280%, rather than the published 216%.

All of this, of course, is before adjustment for the trend cost of energy (ECoE) to define what Surplus Energy Economics terms “the real economy” (as opposed to “the financial economy”). In 2015, underlying output was $87tn on this basis, and ongoing growth in “real”, ex-ECoE terms is about 1.0%. That is still a positive number, but it is dwarfed by the rate at which debt continues to be accumulated.

This deterioration can be expressed in per capita terms, but it shows up in the day-to-day lives of the public in two distinct ways. The first is that the rise in the cost of household essentials continues to out-strip growth in nominal incomes. This is happening, primarily, because these essentials are highly leveraged to energy prices, and to commodities which are traded on world markets. Economists tend to assume that such commodities are priced in the same way as internally-consumed services, but the reality is that there is a huge difference between local and global pricing pressures.

As well as the cost of essentials, the other way in which economic deterioration is showing up in the lives of the public is in deteriorating provision for the future. Ultra-low interest rate policies, adopted to enable the world economy to co-exist with its debt mountain, are keeping borrowing cheap (and asset prices inflated) whilst destroying returns on capital. This is becoming glaringly obvious in pension fund deficits, but is also showing up in the continued escalation of debt.

The elites’ fervent hope, which is that popular discontent dies down, looks increasingly like a pipe-dream. As we have seen, the public is suffering in ways which are very real, but are not readily apparent in the data used by policymakers. This is leading those who take the key decisions into a position of genuine bewilderment – the data at their disposal simply does not tally with the popular mood, leading them to the false assumption that it is the public (rather than the data) which are wrong.

Marie Antoinette’s famous remark – that, if people are without bread, “let them eat brioche” – is probably apocryphal. But the point of the anecdote is that she was wholly ignorant of the circumstances of ordinary people, and this does seem to have been the case.

Today’s policymakers seem to be being lulled into similar complacency by economic data flattered out of all reality by the practice of mortgaging the future in order to inflate the present.

If the public are not going to back down, and the elites are determined to hang on to all of their power, wealth and privileges, the odds on social unrest may be pretty high.

The only way of averting unrest may be for the elites to awaken to the causes of popular discontent, and implement far-reaching reforms. This is not going to happen unless their complacency over the economy can be punctured. If that happens, then they might switch from denouncing “populism” and turn instead to tackling the root causes of popular discontent.

It’s Time to Get Real: Trump’s a Symptom, Not the Problem

I’ve lost patience with the widespread whining about Trump.

Trump’s a symptom, not the problem.

Unless we acknowledge and respond to reality there will be many more and worse Trumps to follow.

Lower and middle class citizens around the world are angry for good reasons:

  • Their incomes have been stagnant or falling despite governments telling them the economy is strong.
  • Their cost of living for things that matter has been rising despite governments telling them inflation is low.
  • They see the upper class getting richer and not being punished for crimes.
  • They carry a high debt load and see that interest rates have nowhere to go but up.
  • For the first time in a long time they worry that the future may be worse than the present.
  • They sense that something is broken and that leaders are not speaking the truth.

Their anger has resulted in:

  • Brexit
  • Trump
  • blame of others
  • extreme parties gaining power around the world
  • social unrest in many countries
  • war drums

The economic stresses experienced by many citizens (and by most countries) are real and have been caused by the depletion of low-cost oil.

The tricks of increasing debt and lowering interest rates have reached their limits and no longer work to mask the depletion of low-cost oil.

Governments have responded with reckless financial policies that guarantee a high-speed crash into a brick wall.

There is no solution to the depletion of low-cost oil.  It is not possible to operate our civilization as currently configured without low-cost oil. There is no substitute for oil.

We need to understand and accept that there will be much less of everything in the future.

We were lucky to witness the peak of human prosperity, and unlucky to witness the beginning of its decline.

No one is to blame. It’s reality.

We need a new story to unite us.

We need new government priorities focused on ensuring the necessities of life are available in the future.

We need to slow down as we approach the brick wall.

We need to stop wasting the precious oil that remains.

We need to get real and vote for wise people who understand what is going on.

We need to break through our inherited denial of reality.

By Tim Morgan: Perfect Storm Gets Nearer: Surplus Energy Economics Update

 

Here is the latest brilliant post by Dr. Tim Morgan, ex Global Head of Research at Tullett Prebon and author of the best financial research reports ever published from inside the finance industry, especially his last report from 2013 “Perfect Storm: Energy, Finance, and the End of Growth“.

https://surplusenergyeconomics.wordpress.com/2017/01/09/85-perfect-storm-gets-nearer/

What is Surplus Energy Economics?

Very briefly, SEE says that the economy is an energy system, not a monetary one. Prosperity is determined by surplus energy – that is, the energy available after the deduction of the energy which is always used up whenever we access energy.

Our entire history can be seen in this way. As hunter-gatherers, all the energy that people obtained from food was consumed obtaining that food, so there was no surplus, no economy and no society.

Agriculture was the “first great breakthrough” because it created the first energy surplus. Put simply, the greater efficiency of farming compared with hunter-gathering, plus the use of animal labour, enabled twenty people to be fed by the labour of nineteen, freeing the twentieth to do other things. This first energy surplus was small, and most people continued to undertake subsistence activities. But there was now an economy of sorts, and a society developed in parallel with it. People could now, for the first time, invest, sacrificing current consumption to create capital assets (such as barns, bridges, agricultural implements and rudimentary workshops) which would improve their lot in the future.

A vastly bigger energy surplus was created when we learned to tap fossil fuels, such as coal, oil and natural gas. This triggered two centuries of exponential growth, not just in economic output, but in population numbers and energy consumption as well. So sophisticated have economies become that, most notably in the West, very few people are engaged in producing food.

 

The end of growth?

For decades, people have speculated about the relationship between exponential growth and a finite planet. This debate rages on, but the balance is tilting, in two very obvious ways.

First, we are discovering the limitations of the earth as an ecosystem and, second, the surplus energy which has driven growth in economic output and population numbers is coming under mounting pressure.

Where fossil fuels – still well over 80% of our energy consumption – are concerned, two factors are in play. Depletion is robbing us of the gigantic, ultra-low-cost sources of energy which hitherto powered economic growth. Technology is endeavouring to offset this, both increasing the efficiency with which we access conventional fuels, and enabling us to tap energy from renewable sources.

Technology will doubtless continue to progress, but we are in danger of complacency over technological solutions. Renewables still account for barely 3% of global energy consumption, and no-one has yet worked out how to power a 747-size jet using renewables, or how to extract 1 tonne of ore from 500 tonnes of rock without using fossil fuels.

We should be optimistic about renewables, but also realistic. Renewables can supply energy more cost-effectively than fossil fuel sources discovered and brought on stream today. But my interpretation of the thermodynamic balance is that renewables are not going to take us back to an age of vast, low-cost, high-surplus energy from giant fields.

 

What next?

If the surplus energy interpretation of the economy is correct, growth should continue to prove elusive. But our system is so predicated on growth – a topic for another article – that we cannot accept even stagnation, let alone adjust to decline.

So we have been faking growth by borrowing. By 2008, the debt mountain had become so big that we could no longer afford to pay a normal rate of interest on it, so the authorities adopted ZIRP (zero interest rate policy) in order to prevent the economy being engulfed. But ZIRP, and other forms of monetary manipulation, cannot resolve the situation, and have their own costs. At zero- or near-zero rates, the economy cannot function normally, and it certainly cannot provide for the future, which is why huge deficits are now imperilling pension provision.

In theory, we might go on faking growth for many more years yet, and I’m pretty sure the authorities will be mightily tempted to try. But this would result in a further escalation of debt, which would also mean that raising interest rates significantly – let alone restoring them to something resembling normality – would become out of the question (which may already be the case). Comparing 2020 with 2015, and taking inflation out of the equation, the world seems likely to grow its GDP by close to $10tn, but to add at least $50tn to its $151tn non-financial debt mountain.

If (or, rather, when) debt escalation reaches crisis point, some kind of write-off might be tried, unless the authorities decide to unleash high inflation in an attempt to destroy the real value of debt. Inflation, which has been described as the “hard drug” of our economic system, can very rapidly get out of control.

So here we have some pointers to the future – debt escalation, and/or hyper-inflation, both of which would be insane choices, but neither of which are beyond the short-termism of the political class.

Ultimately, and whichever folly is chosen, faith in fiat currencies is likely to collapse, to which I will only add that there are already at least two major currencies that I, for one, would not want to hold. In the normal course of events, inflation strips money of its value, but this tends to be gradual – we have little widespread (though plenty of local) experience of what happens when a fiat currency falls apart.

People cannot be expected to accept any of the post-growth consequences described here with a resigned shrug. They are not doing so now – instead, and naturally, they are beginning to blame, and repudiate, established political leaderships, and this was the most significant trend to emerge in 2016.

If the economy – and, in the first instance, the financial system – does start to implode, governments are highly likely to resort to coercion, spouting precious claptrap about “the national interest” as they try to maintain their hold on power.

By Tim Clarke: The Demise of the Global Oil Industry: Best Case 2022

This analysis concludes that the oil industry will collapse by 2022.

The global economy and food system we depend on to survive will collapse a short time after the oil industry fails.

If some monkey somewhere makes a mistake collapse could occur sooner.

It’s a good thing monkeys rarely make mistakes.

Think about this for a moment. We are at best 10 years from collapse and it’s not even mentioned as an election issue.

Our inherited denial of reality is amazing!

http://www.feasta.org/2017/01/22/end-of-the-oilocene-the-demise-of-the-global-oil-industry-and-of-the-global-economic-system-as-we-know-it/

clarke18

Think of the Global Economy as the Titanic

The Captain and the owners (politicians, economists, corporate leaders) were warned many times (Limits to Growth 1973, Peak Oil, etc) that the course chosen (endless growth) would take the ship into dangerous waters (end of economic growth), but the stakes were high; reputations and money were at stake (corporate profits, political power); so – carry on regardless – full-steam ahead. The Titanic has now collided with the iceberg and is mortally holed; but still it carries on steaming with all the lights on. People on the deck (us) are still partying (taking on debt at fantastic rates) unaware of what is going on below decks; but water (thermodynamic depletion of oil energy, exponential unsustainable debt) is coming in fast.

The pumps (the real economy) are not keeping up (all indications of global trade are in decline) and the Titanic is sinking (exponential debt is overwhelming the global financial system). The pumps need energy (Oil: which powers 97% of transport, extraction and production of commodities including other energy sources, food etc), but this energy is depleting fast (EROI) and within a short time there will not be enough affordable energy for the pumps, which will slow, and water (debt) will pour rapidly in to flood the ship (financial contagion, derivatives exploding, banks collapsing). The Titanic (Global Economy), deemed unsinkable IS SINKING – fast.

We will not be aware of this until the cold water laps at our feet and the lights go out. Some people (BW Hill, Dr Arnoux, Richard Heinberg, and many others too numerous to mention) are shouting to the rest (society) to man the lifeboats (prepare for a systemic shock to the oil/energy/financial system) while there is still time. Who will listen?

By Alice Friedemann: Book Review of “Failing States, Collapsing Systems: Biophysical triggers of Political Violence by Nafeez Ahmed

9783319478142_p0_v3_s192x300

Dr. Nafeez Mosaddeq Ahmed is an investigative journalist that focuses on biophysical issues like over population, resource depletion, and climate change that underlie most of the wars and social unrest around the world.

Ahmed recently published a book titled “Failing States, Collapsing Systems: Biophysical triggers of Political Violence” and Alice Friedemann has written an excellent review of the book.

http://energyskeptic.com/2017/book-review-of-failing-states-collapsing-systems-biophysical-triggers-of-political-violence-by-nafeez-ahmed/

 

Since the 2008 financial crash, there’s been an unprecedented outbreak of social protest: Occupy in the US and Western Europe, the Arab Spring, and civil unrest from Greece to Ukraine, China to Thailand, Brazil to Turkey, and elsewhere. Sometimes civil unrest has resulted in government collapse or even wars, as in Iraq-Syria and Ukraine- Crimea. The media and experts blame it on poor government, usually ignoring the real reasons because all they know is politics and economics.

In the Middle East, experts should also talk about geology.  Oil-producing nations like Syria, Yemen, Egypt, Nigeria, and Iraq have all reached peak oil and declining government revenues after that force rulers to raise the prices of food and oil.  This region was already short on water, and now climate change (from fossil fuels) is making matters much worse with drought and heat waves causing even greater water scarcity, which in turn lowers agricultural production.  Many of these nations have some of the highest rates of population growth on earth at a time when resources essential to life itself are declining.

The few nations still producing much of the oil – Russia, Saudi Arabia, and the U.S. are about to join the club and stop exporting oil so they can provide for their domestic population.

 

ahmed-2017-peak-oil-fresh-water-population

 

Ahmed says that so far after peak oil production, Middle-Eastern economies have declined as revenues declined, leading to systemic state-failure in roughly 15 years, more or less, depending on how hard hit a nation was by additional (climate-change) factors such as drought, water scarcity, food prices, and overpopulation.

Saudi Arabia, and much of the rest of Arabian Gulf peninsula, may experience state-failure well within 10 to 20 years. If forecasts of Saudi oil depletion are remotely accurate, then by 2030 the country will simply not exist as we know it. Coupled with the accelerating impacts of climate-induced water scarcity, the Kingdom is bound to begin experiencing systemic state-failure at most within 20 years, and probably much earlier.

 

It is difficult to avoid the conclusion that as we near 2045, the European and American projects will face escalating internal challenges to their internal territorial integrity, increasing the risk of systemic state-failure. Likewise, after 2030, Europe, India, China (and other Asian nations) will begin to experience symptoms of systemic state-failure.