THE PARADIGM IS THE ENEMY: The State of the Peak Oil Movement at the Cusp of Collapse

A Speech by Michael C. Ruppert for the Local Solutions to the Energy Dilemma Conference
April 27-29, New York City, at Cooper Union

[This is the most important speech of my life. If you read anything I’ve written this year, read this – MCR]

April 28, 2006 1630 PST – (FTW) – NEW YORK - As a matter of necessity, in the course of a turbulent and often very difficult life, I have developed a pretty warped sense of humor. As most police officers, nurses, ER doctors, paramedics, and military combat veterans know, the best time to find humor is when things are at their worst. Sometimes the humor that emerges from these situations is strange, to say the least. And yet sometimes it remains the most memorable humor of a lifetime—humor that can actually sustain you in tough times. Humor is energy.

Too often Peak Oil activism reminds me of a statement that I found a long time ago in a book of famous quotations. In the section containing the last recorded words of famous people I found a quote that has stayed with me ever since.

The quote was simply, “We’ve got them now.”

The person who wrote those last “recorded” words on a dispatch to his commanding officer, General George Crook, was George Armstrong Custer.

During the course of this conference I have heard precious little attention paid to events in the world around us indicating that Peak Oil is about to have its global “coming out party” and what that might mean. In almost every nook, cranny and corner of the planet, stress points are beginning to fracture. For the past five years I have argued, emphasized, and repeated endlessly that perhaps the biggest mistake of all time was made on September 11th 2001, when the only real global operational plan to deal with Peak Oil was put into effect. On September 11th we began a war, now infamously known as “the war which will not end in our lifetimes,” to decide who will control the last remaining oil and gas reserves on the planet.

In Crossing the Rubicon I wrote, “Events in the five-year period that began on September 11th, 2001 will determine the course of human history for several centuries to come.” We are just months away from the end of that five-year period. What has been accomplished?

The painful answer is: not enough.

Where are we in the real world and how do we judge our current activities in light of real-world events? To sum it up in the words of one of the most senior members of the Peak Oil movement I know, Jay Hanson, “I see my worst fears unfolding right in front of my face.” Jay wrote those words just about a week ago.

Jay started the first Peak Oil website in the 1980s, almost even before there was a web. We should listen to Jay, and I could not agree more with his assessment; my worst fears are unfolding right in front of my face.

Perhaps the greatest flaw in the Peak Oil movement’s current operating paradigm is that, a part of the movement at least, instead of building lifeboats in the face of an immediate disaster, is delusionally focused on trying to build alternative-powered luxury liners that operate just like the paradigm we as a species need to be abandoning. Not only is this a futile effort, it may well be responsible for killing or destroying the lives of people who at least partially understand Peak Oil and who are trying to find the best courses of immediate action for themselves and their families.

Some parts of this movement however—and tonight I intend to honor two men who are leading the way—have seen the writing on the wall and are independently taking appropriate courses of action that demonstrate both the kind of incisive thinking and leadership that will be needed in very short order.

Before I tell you about these men I think it’s a good idea to stop for a minute and take an inventory of the world in which we live today—right now.

THE STATE OF THE WORLD’S ENERGY

I have observed that almost every Peak Oil conference, whether this one, or the Association for the Study of Peak Oil, or ASPO-USA, makes only the most superficial attempt to evaluate geopolitical and economic conditions. These conditions, more than the rate at which supplies are depleted, will determine how Peak Oil and collapse manifest in our lives.

• The Times of London on April 8th ran a story that should have pre-empted every other major story that day. Headlined “World ‘cannot meet oil demand’”. The story’s first sentence read, “The world lacks the means to produce enough oil to meet rising projections for demand for fuel, according to Cristophe de Margerie, head of exploration for Total.” Later the story quoted Margerie as saying, “’Numbers like 120 million barrels per day will never be reached, never’ he said.”

• In the last year we have seen the collapse of Kuwait ’s super-giant field Burgan; accelerated decline in the world’s second-largest field, Mexico ’s Cantarell; and an overall global decline rate approaching 8%. We have seen Saudi Arabia fail to increase production while at the same time finding it more difficult to hide deteriorating reservoir conditions in all of its mature fields, including Ghawar. As of tonight, more than 30 of the world’s largest producing nations have entered steep decline.

• Discoveries continue to fall off a cliff. Over the last four years the world has been consuming 6 barrels of oil for every new one found. Publicity stunts, such as the recent attempt to reclassify Venezuelan tar as oil – even when applauded by dilettantes like Gregg Palast – are having no impact on markets, prices or public policy. I think we can safely say at this point that we will soon see an end to the influence of charlatans and schemers like Daniel Yergin of Cambridge Energy. (Now there’s at least one bright note.) At this point, the Peak Oil movement should avoid expending needless energy on any arguments about whether Peak Oil is real or not. That precious energy is needed elsewhere. We have won that debate.

• Soaring commodity prices for everything from copper, to uranium, to cement and steel are not only hampering needed infrastructure investment, they are also making it almost impossible to build new drilling rigs, especially deep water rigs. Commodity scarcities are the result of overpopulation, hoarding, over consumption and nothing else. Drilling rigs themselves are in extremely short supply around the world and I believe we should also stay away from any debates about whether new oil supply will even make a difference. It will not and we need only continue to breathe in and out to see this position vindicated also.

• The US government continues an unwinnable war in Iraq while building massive permanent bases and the largest embassy compound ever built. Not only does the US have no intention of leaving Iraq , it has committed—whether under Republican or Democratic leadership—to staying forever—whatever that means. The Empire’s position is clear, not as a result of what it says, but as a result of what it has done. America ’s primary plan to deal with Peak Oil is to fight or intimidate for energy supplies wherever it deems necessary. That, of course, has forced the rest of the world—with a few notable exceptions like Norway and Brazil —to dance to the same sheet music. As a result, I would estimate that of every ten units of energy (or money) expended preparing for Peak Oil today, nine are spent preparing for war while only one is spent building lifeboats and teaching people how to survive. This is sheer insanity.

• The US government is playing a bluff hand over an attack against Iran , which in spite of being both unlikely and risking a global nuclear holocaust, has resulted in massive increases in military spending all around the planet. A global arms race is now using up energy and commodities that should be used rebuilding railroads, enhancing mass transportation, and building renewable infrastructure to soften the coming blows.

• In the face of this, the entire world, and especially China , Russia , India , Germany and Japan are pouring hundreds of billions of dollars of investment into Iran . This is one of many sure signs that the American Empire’s weaknesses are becoming visible. There is blood in the water and blood in the water usually leads to a fight. The world, at least as far as its pocketbook is concerned, is betting on Iran .

• Russia is selling Iran lots of Tor M1 anti-aircraft missile systems and cruise missile and high-speed torpedo technologies. China also is flooding Iran with advanced military systems.

• The US has stepped up deliveries of weapons systems and military advisors to oil-producing regions around the world. This has been matched by similar deliveries to the same regions by Russia , China , Pakistan , Saudi Arabia , Venezuela , France , Britain , India and many other countries. A best-selling novel in China , The Battle in Protecting Key Oil Routes, has the Chinese navy destroying a US carrier battle group. The popular book documents a bloody contest over control of the Straits of Malacca, that narrow channel through which most of China ’s, Japan ’s, and Korea ’s energy passes.

• China ’s Hu Jintao, clearly one of the world’s only major leaders with both plans and choices, is making direct calls on Saudi Arabia and Nigeria as George W. Bush haplessly points to hydrogen fuel cell cars as a solution. Don’t worry about how many American people will buy into such Bush nonsense. Worry about how many world leaders are watching these same clips and asking, “Is that the best he can do? America is in deep shit.”

• In Nigeria—the US’s fifth largest oil supplier and the world’s eighth—groups of well-organized and supplied rebels are using high-tech email, bombs, bullets and kidnapping to terrorize major oil companies. Production is threatened on a daily basis. In a world where there is no place else to go to replace even 50,000 barrels a day—out of the 84 million needed—the totally corrupt regime of Olusegun Obasanjo is besieged by rebel and dissident groups on many fronts. I have no doubt that several of these groups are being financed, trained, led and supplied through covert arms of the US, Chinese, Russian, British, Saudi, Pakistani and/or Indian governments.

• In nearby Chad—which is the source-country for the Chad-Cameroon pipeline delivering 160,000 barrels a day into the global mouth—as he attempts to ward off an aggressively hungry World Bank, President Idriss Deby is literally holding oil hostage. Knowing full well that to shut down the pipeline would cause an estimated $10 jump in the price of oil, he is literally telling the west, “Come any closer and I’ll shoot the oil.”

• At the same time, Chad is beset by rebel insurgents from neighboring Sudan , which is China ’s fifth-largest oil supplier. Both the US and China are hip-deep in covert operations in Sudan.

• On April 18, Secretary of State Condoleezza Rice met with one of Africa’s most brutal dictators, Teodoro Nguema of Equatorial Guinea —Africa’s third-largest oil exporter, calling him a good friend of the US . With institutional memories as short as they are, few remember that Sir Mark Thatcher, son of Britain ’s Margaret Thatcher, was nabbed last year in the middle of a coup intended to oust Nguema.

• All of Africa, especially West Africa—exactly as I predicted in 2003, in Crossing the Rubicon and in last year’s lecture series which became our newest DVD Denial Stops Here—is exploding with armed insurrections from the Western Sahara region to Angola . It is West Africa where I believe we will see proxy wars likely intensifying this year, which could trigger a global nuclear exchange in very short order.

• But murder, far more callous, is about to be perpetrated by the Democratic Party as it enters the 2006 midterm campaigns with what is surely—barring a miracle—going to be one of its major planks in 2008: “Don’t worry,” they will promise, “the Democrats will restore cheap gasoline for all and find a no-pain answer to all of our energy woes. High prices are the fault of greedy oil companies and price gougers, not a lack of supply.” I can promise you now, Hillary Clinton, that if the Democratic Party adopts this approach it will find in me an enemy that will make FTW’s editorial posture towards the Bush administration over the last five years look like abject friendship.

• American mainstream media has become absolutely and certifiably schizophrenic on the issue of Peak Oil. Within the space of an hour, one can watch segments acknowledging Peak Oil and Gas and the insoluble problems they bring, and segments assuring us that there is no problem at all if we just fix a few little things.

• On April 11th The Financial Times reported that Russian production is falling and expected to decrease—rather than increase—rapidly over the next four years.

• On April 21, Russia ’s giant, Gazprom—for the second time in less than a year—threatened to shut off Europe’s only major source of natural gas. Just a month previously, a desperate and hobbled Britain surrendered its energy sovereignty to the European Union in the hopes of getting better energy prices at the end of Russia ’s long natural gas supply line.

• On April 24th, just a few days ago, during his state visit to Saudi Arabia , Chinese President Hu Jintao signed a series of accords in which China , in exchange for a larger portion of Saudi oil exports, agreed to transfer high-tech weapons and other technologies to the Saudi monarchy in exchange.

• At the same moment that George W. Bush has announced that he will stop refilling the US Strategic Petroleum Reserve in an ill-conceived attempt to lower pump prices—a completely shortsighted and self-serving gesture—China is in negotiations with Saudi Arabia to begin filling a new one.

• Climate Change and hurricanes not only continue apace but have accelerated. Now that we are just weeks away from a new hurricane season, fully 23% of Gulf of Mexico production remains shut-in after last year’s hurricanes. Recently the Department of Energy acknowledged that most of that would never be rebuilt due to high investment costs at mature and post-mature reservoirs. Aside from the fact that it’s not cost effective, this is also because of rig shortages. This is what FTW warned you about almost a year ago. When and if we ever have a chance to look back we will historically mark Katrina and Rita as the singular moment in time when a true US economic and military resurgence became impossible; the moment when the Empire began it’s collapse. In other words, that was the moment when the Empire passed from decline to terminal status.

• On April 4th, Dow Jones’ MarketWatch reported that $6 to $7 gasoline might be coming this summer. Is there anyone in this room tonight who does not believe that $6-$7 gasoline would be an unmistakable sign of collapse?

• And let me add an observation here. I think a good part of this unseasonable spike in American oil prices is both caused by the switch out from MTBE to ethanol and a classic political strategy which is to create a bad problem and then appear to solve it so that people will accept an otherwise unacceptable solution. This is an election year. The elections are not for seven months. I for one do NOT think we will see $6 or $7 gasoline this summer. I think gas prices may reach $4 or even $5 for a short period, after which the Bush administration (say sometime between July and September) will again tap the Strategic Petroleum Reserve and his oil industry base will—they hope—be able to find a few million barrels to temporarily drive prices down, give Republicans a desperately-needed electoral boost, and feed another dose of valium to the increasingly worn out American consumer.

• But to assume that the current high prices are solely caused by the MTBE/Ethanol switchover is to miss the fact that Britain is now experiencing it’s highest-ever gasoline prices averaging more than $8 per gallon or that Japan—according to the news agency Chugoku—has now reached it’s highest-ever price for diesel fuel at almost $4.00 per gallon. These countries do not have MTBE rules to be concerned with. Peak Oil is here.

There is an enormous risk lurking in all this. I mean a potentially deadly risk.

As the effects of Peak Oil intensify there is less and less wiggle room on the planet for any miscalculation. Worse, there is less and less room to recover from or adjust to any “surprises” that might come along.

SURPRISES

What are some of these possible surprises?

• Just one more major hurricane

• A major earthquake in any oil producing region or pipeline corridor from Russia ’s far east, to Iran , to Alberta

• Any one of a dozen possible side effects from global warming, whether from melting tundra that might sink pipelines, to rising sea levels that might endanger offshore production

• Civil unrest in any oil-producing region that gets out of control and damages more infrastructure than can be quickly repaired

• A decision by Venezuela ’s Hugo Chavez to redirect just 10 or 15% of his US exports to other customers

• A successful attack on Saudi Arabia ’s Abqaiq terminal

• Political unrest in our second-largest oil supplier, Mexico

• Major unrest in the Caspian basin – another region where covert operations are now probably the second- or third-largest GDP component for several nations.

As I speak tonight, India is moving to supply MiG 29s to Tajikistan at the same time that Kyrgyzstan is threatening to revoke permission for US bases. This is a building vacuum that China , India , Russia and Pakistan (all nuclear powers) are eager to fill. Add Iran to the list of nations seeking increased influence in the Caspian Basin.

Another one of many reasons why the US cannot and will not attack Iran is that—unreported by the major media—the US military has undertaken quiet but significant military build ups in both West Africa and in the Caspian. US military personnel have been dispatched to Nigeria and NATO and the US Navy have begun moving into to the Gulf of Guinea. This is pulling ever tighter on the already over-stretched rubber band holding the US military together as it experiences a continuing, unmitigated and unprecedented defeat in Iraq .

There are many more possible precipitating events that could push the first dominoes in the chain of collapse. Any one of them could trigger a massive and sudden descent into chaos that would catch all of us by surprise. My position is that we cannot afford to be unprepared for surprises. And it’s probably an event we haven’t thought of that will ultimately do it. These are only a few possibilities.

THE STATE OF THE AMERICAN AND WORLD ECONOMIES

• General Motors, as it stands on the brink of bankruptcy, has announced that it lost $106 billion last year.

• Ford and Daimler Chrysler are teetering not far behind GM as Toyota is poised to become the largest auto maker in the world, bigger in terms of sales than America ’s Big Three combined.

• As US News told us last December 19th, 800,000 jobs were going to be cut last winter. The final numbers aren’t in yet, but it looks like that happened.

• According to an MS-NBC story dated April 24, “The Housing Bubble Has Popped” as inventories swell, sales decline, prices soften, lenders are raising rates and the first signs of panic start to appear. For those who have followed the housing bubble closely, you know that this is a global housing bubble and that these trends have become apparent from the UK, to Australia, to Japan. Along with falling house prices and a drying up of credit, over-stretched consumers now face very difficult choices as they are forced to decide between driving, eating, paying their bills, or having a place to live. This particular collapse is just beginning and the world economy must follow its lead.

• New stories are reporting that some Americans are pawning precious objects for gas money.

• Consumer debt continues to skyrocket as the US trade deficit continues to explode.

• Bankruptcies are at an all-time high.

• As Reuters told us on April 22, the Finance Ministers of the G7 nations have just announced after their recent meeting in Washington that the dollar is going into decline.

• On April 24th, Qatar announced that it will begin diversifying out of dollars and into Euros.

• On April 4th, according to Reuters, the Vice Chair of the Chinese parliament urged that China reduce its holdings of US debt.

• On February 22, the director of Norway ’s stock exchange recommended that Norway drop out of the London Petroleum Exchange (priced in dollars) and open an oil trading bourse priced in Euros.

• On January 12, Britain ’s Independent announced that Norway had begun preparations for a global environmental and economic collapse. The story reported that “ Norway has revealed a plan to build a ‘doomsday vault’ hewn out of an Arctic mountain to store two million crop seeds in the event of a global disaster. The store is designed to hold all the seeds representing the world's crops and is being built to safeguard future food supplies in the event of widespread environmental collapse.

• In a sign of pending inflation, the Federal Reserve last month stopped telling us what the M3 money supply was in a surefire indication that inflation is on the way. This came conveniently after further inflationary indicators were hidden by removing the cost of gasoline and food from the Consumer Price Index.

• On March 28, Al Jazeera warned that Asia must be prepared for an imminent dollar collapse.

• On March 26, India moved to relax all currency controls for the Rupee. This suggests that India knows a dollar crash is coming and hopes that the Rupee will enjoy the bounce.

• China has made another adjustment re-evaluating the Yuan, accelerating the dollar’s decline.

• The Asian Development Bank has announced plans to develop a regional currency index as a preliminary step in the creation of a Euro-like currency for Asia.

• The dollar has lost six cents against the Euro in the last six weeks.

• Gold, which I have and still devotedly endorse as a safe haven for either rich or poor, has broken through to highs not seen in 18 years. I had not expected gold to break $600 an ounce until at least this fall. It happened weeks ago. Notwithstanding the predictable price corrections that we will see, as a failed and broken system of gold price suppression loses control, I think the path is now fairly clear to $800 gold within two years or less. When Peak Oil becomes aggressive, within the next five years, I think $1,000 gold is a certainty. As always, I encourage FTW subscribers and anyone who will pay attention to continue to invest in gold. To be precise, I encourage them to invest in physical, tangible, gold bullion or bullion coins like the Maple Leaf or Krugerand that can be kept close to home and hearth. Small gold purchases can be made for as little as a few hundred dollars. All of the struggling FTW subscribers who have made even tiny purchases have benefited by seeing even their meager investments double in four years and increase by 50% in value in just the last 18 months.

• Morgan Stanley’s Stephen Roach – who last year warned of an economic Armageddon is now warning, “I continue to believe that the American consumer is the weak link in the global daisy chain. The combination of rising long-term interest rates and higher oil prices puts an unmistakable squeeze on discretionary income – the last thing overly indebted, savings-short US consumers need…”

So why then has the Dow recently reached six-year highs? It’s simple, and I know that my good friend and colleague, Catherine Austin Fitts will agree, that the DOW Jones Industrial Average has absolutely nothing to do with measuring the quality of American life. I am reminded of one of the most important quotes I have ever obtained for a story, that of Dutch economist Martin Van Mourik who told the Paris ASPO Conference in 2003, “It may not be profitable to slow decline.”

Indeed ladies and gentlemen, we have reached the point where every increase in the Dow will mean that life has actually gotten worse for Americans and riskier for the world as a whole. I described the endgame of this irony in one of my favorite essays of all time Globalcorp. As M. King Hubbert wrote, and as Catherine Austin Fitts teaches, and as I have said for so long, “Until you change the way money works, you change nothing.”

It is a shame that much of the Peak Oil movement that understands this problem is foolishly trying to change the way money works systemically, instead of trying to change it in the only way that time and circumstance now permit—individually, locally and regionally. The first and primary requirement for that to occur is for people to disengage from the global paradigm.

TWO LEADERS POINTING THE WAY

During my eight-month hiatus from public speaking, I have watched the Peak Oil movement morph from its general status as a “lunatic fringe” group to acceptance and even recognition and honor as an “influential special interest group.” (That’s what they call groups like us on Capitol Hill and in the mainstream press). Many members of congress, business leaders, and even the major media listen to us now. To the organizers of this conference and to all of us who have labored on the Peak Oil field for years—like Jay Hanson, Richard Duncan, Walter Youngquist, Ken Deffeyes and Colin Campbell, for decades—there is some relief in seeing growing public (and even governmental) acknowledgment of Peak Oil. Of course, most of us have known that all we had to do was keep breathing in and out for a while and we would be vindicated on the issue.

But now what?

Before I continue, let me stop and acknowledge that the backbone of this section of my speech tonight was derived from a series of original From The Wilderness articles published almost a year ago. Our then Science Editor, Dale Allen Pfeiffer, brought to my attention a brilliant Russian writer named Dmitry Orlov who—having experienced the collapse of the Soviet Empire—thought that there might be some lessons to learn if rational minds compared what looked to be the ever-more-certain coming collapse of the American Empire. After listening to Dale and corresponding with Dmitry—who presented here yesterday with my good friend, and a great Peak Oil leader, Matt Savinar—I instantly commissioned a three-part series for FTW titled Post-Soviet Lessons for a Post-American Century.

That series is probably the single most eloquent and cogent piece of writing FTW has published in its eight-plus years. And if you are familiar with FTW writers like Stan Goff, Jamey Hecht, Carolyn Baker, and Michael Kane you know that’s a heck of a compliment. You can still read Dmitry’s stories on our site and if you have not, I beg that you do.

So let me acknowledge right now, that our next important lesson tonight was first articulated by Dmitry—Dmitry, if you’re here, please stand up. I’m going to quote Dmitry quite a bit as I add my own observations and updates about the biggest challenges lying in front of us and how we might deal with them.

At the start of his series, Dmitry observed that when he started looking for stories connecting economic collapse to Peak Oil in October 2004 there were 16,300 such documents listed on search engines. Less than a year later, by April 2005 there were 4,220,000. He pointed out correctly that the reason why such stories had not been discussed in the media was attributable to only one cause: denial.

Denial.

Let’s take a look at just a few of the most important quotes from Dmitry’s essays. You really need to read the entire set. And even though these quotes are clipped from disparate sections, when strung together they speak for themselves admirably and paint a deeply-moving picture.

• “Instead, there is much discussion of policy: what ‘we’ should do. The ‘we’ in question is presumably some embodiment of the great American Can-Do Spirit: a brilliantly organized consortium of government agencies, leading universities, research centers, and major corporations, all working together toward the goal of providing plentiful, clean, environmentally safe energy, to fuel another century of economic expansion. Welcome to the sideshow at the end of the universe!”

• “The next circle of denial revolves around what must inevitably come to pass if the Goddess of Technology were to fail us: a series of wars over ever-more scarce resources. Paul Roberts, who is very well informed on the subject of peak oil, has this to say: ‘what desperate states have always done when resources turn scarce… [is] fight for them.’ Let us not argue that this has never happened, but did it ever amount to anything more than a futile gesture of desperation? Wars take resources, and, when resources are already scarce, fighting wars over resources becomes a lethal exercise in futility. Those with more resources would be expected to win. I am not arguing that wars over resources will not occur. I am suggesting that they will be futile, and that victory in these conflicts will be barely distinguishable from defeat. I would also like to suggest that these conflicts would be self-limiting: modern warfare uses up prodigious amounts of energy, and if the conflicts are over oil and gas installations, then those installations will get blown up, as has happened repeatedly in Iraq . This will result in less energy being available and, consequently, less warfare.”

• “While the United States used to have far more goodwill around the world than the Soviet Union, the ‘evil empire’ gap has narrowed since the Soviet Union disappeared from the scene. Now, in many countries around the world, including Western countries like Sweden , the United States ranks as a bigger threat to peace than Iran or North Korea . In the hated-empire race, the United States is now beginning to look like the champion. Nobody likes a loser, but especially if the loser is a failed superpower. Nobody had any pity for the poor defunct Soviet Union; and nobody will have any pity for poor defunct America either.”

• “The United States is now facing a current account deficit that cannot be sustained, a falling currency, and an energy crisis, all at once. It is now the world's largest debtor nation, and most people do not see how it can avoid defaulting on its debt. According to a lot of analysts, it is technically bankrupt, and is being propped up by foreign reserve banks, which hold a lot of dollar-denominated assets, and, for the time being, want to protect the value of their reserves. This game can only go on for so long. Thus, while the Soviet Union deserves honorable mention for going bankrupt first, the gold in this category (pun intended) will undoubtedly go to the United States , for the largest default ever.”

• “Both countries replaced family farms with unsustainable, ecologically disastrous industrial agribusiness, addicted to fossil fuels. The American ones work better, as long as energy is cheap, and, after that, probably not at all.”

• I’ll have to paraphrase Dmitry on race and violence. But in that section he noted that not only was race not an important stress line in the collapse of the Soviet Union, there were also virtually no firearms in private hands. His advice for minorities in America was to find either an ethnically homogeneous community “while the rest would be well-advised to look for the few communities where inter-ethnic relations have been cemented through integrated living and intermarriage, and where the strange and fragile entity that is multi-ethnic society might have a chance of holding together.”

• “Another key difference between the US and the USSR : in the Soviet Union, nobody owned their place of residence. What this meant is that the economy could collapse without causing homelessness: just about everyone went on living in the same place as before. There were no evictions or foreclosures. Everyone stayed put, and this prevented society from disintegrating.”

• “One more difference: the place where they stayed put was generally accessible by public transportation, which continued to run during the worst of times. Most of the Soviet-era developments were centrally planned, and central planners do not like sprawl: it is too difficult and expensive to service. Few people owned cars, and even fewer depended on cars for getting around. Even the worst gasoline shortages resulted in only minor inconveniences for most people…”

• “Most people in the U.S. cannot survive very long without an income. This may sound curious to some people—how can anyone, anywhere survive without an income? Well, in post-collapse Russia, if you didn't pay rent or utilities—because no-one else was paying them either—and if you grew or gathered a bit of your own food, and you had some friends and relatives to help you out, then an income was not a prerequisite for survival. Most people got by, somehow.”

• “A collapsing economy is especially hard on those who are accustomed to prompt, courteous service. In the Soviet Union, most official service was rude and slow, and involved standing in long lines. Many of the products that were in short supply could not be obtained even in this manner, and required something called blat: special, unofficial access or favor. The exchange of personal favors was far more important to the actual functioning of the economy than the exchange of money. To Russians, blat is almost a sacred thing: a vital part of culture that holds society together. It is also the only part of the economy that is collapse-proof, and, as such, a valuable cultural adaptation.”

• And finally, Dmitry wrote, “In all, I expect drugs and alcohol to become one of the largest short-term post-collapse entrepreneurial opportunities in the United States , along with asset stripping, and security.”

As Dmitry wrote in his series, the collapse of Empires, as with Rome, has in the past sometimes taken centuries. In the case of the Mayans it happened in a much shorter period. But Dmitry was quick to observe that the first stages of collapse are often the most dislocative, painful, and demanding because that’s when the first psychological and physical shocks hit hardest. And I would argue—along with the likes of Joseph Tainter—that the collapse of modern, highly-complex empires is both accelerated and far more aggravated than what happened 1600 years ago in Rome.

The Soviet Empire collapsed and disappeared in less than four years and the devastation for the Russian people was both profound and deadly. I have been to Russia and I will never forget a little piece of Russian humor left over from the siege of Leningrad (now St. Petersburg) in the Second World War. I told my Russian hosts that I wanted to get a little outside of the cosmopolitan center of Moscow and see some “real Russia ”.

The first thing they said was, “If you go into a restaurant, don’t order chicken.”

I hesitated and then asked, “Why?”

“Because”, they said, “ever since the Germans laid siege to Leningrad, chicken is what we have called it when we had to eat our comrades to stay alive and in the fight. In some parts of Russia one is still never sure.”

Do we dare assume that Americans are special and somehow exempt from all the vicissitudes that have befallen every other collapse of empire in history?

For those of you who chided me last year for predicting an American economic collapse this last winter, which some argue—in spite of this evidence—failed to materialize, let me point out that—and we will talk about it tonight—there are strong signs that collapse has already begun. I never said the collapse would be over last winter, I only said that it would begin. That collapse will most certainly be here—in emerging bloom and for all to see—this summer. No one will remain unaffected by it. Whenever it ends, it is not going to end prettily.

When one is preoccupied with survival, anything beyond survival becomes an imponderable luxury. And to mistakenly label a luxury a necessity makes it impossible to survive. The Peak Oil movement needs to ask itself now: what are its necessities and what are its luxuries? There is precious little room for error now. These decisions will be hard but they must be made.

If some Latin scholar had predicted the day that the barbarians would sack, loot, and occupy Rome and missed it by only four months, he or she today would be regarded as a prophet. I am content tonight, to just be the same asshole many of you have come to know and love—or hate—over the years. I’m just doing my job as I see it needs to be done. That is all I have ever done.

POST CARBON

And now we come to the second man I would like to honor tonight, Julian Darley of Global Public Media and the Post Carbon Institute.

Put simply, the Post Carbon Institute’s mission is to save lives. Put a little more succinctly, the Post Carbon Institute’s mission is to work with local groups around North America and the world to facilitate their construction of their own lifeboats, specifically tailored to the strengths and weaknesses faced by each unique locale that presents itself for help.

To facilitate this, the Post Carbon Institute has adopted a unique approach. Rather than dictate top-down policies or provide cookie-cutter solutions which may or may not prove helpful as collapse accelerates, the Institute facilitates relocalization by insisting that each Post-Carbon “outpost,” as it calls them, operate autonomously while receiving only guidance, support, and updated information and news from the Institute itself. Each outpost then has only one mission, to focus on immediate improvements to its community such as, but certainly not limited to: local farming, car sharing, local currencies and event organization. As Julian puts it, “the stakes are the survival of this project we call civilization.”

Since beginning its work in the second half of 2003, the Post Carbon Institute has fostered the creation of more than 90 local groups all over the US and Canada, as well as in the UK, Australia, Sweden and even Yemen. It has grown explosively as small, aware groups of citizens have seen the wisdom of Julian’s approach which begins with one of the first rules in any survival situation: Let the people on the ground make the decisions according to their own judgment, in their own place.

Instead of 90 Post Carbon groups around the world there should be 9,000. These are the kinds of numbers we need to see if we are to really make a difference in helping to decide who eats and stays warm, who lives and who dies.

If you have not yet visited the Post Carbon web site, you must.

If this conference has motivated you to start preparing for the challenges that lie ahead, you need to begin by accepting the head start that the Post Carbon Institute has given you. Richard Heinberg—another great hero of this movement—has said, “The Post Carbon Institute is clearly the first medic on the scene—the first organized response to Peak Oil.”

About a year and a half ago, seeing what was coming, I looked around and saw a crying need for someone to take the lead on this challenge. Before that, my expertise and that of From the Wilderness had been geopolitical and economic analysis. I had precious little experience or training on issues of sustainability, agriculture, water, alternative construction, and all the other things we need to learn.

Nevertheless I was willing to take FTW and my writings in that direction even though I knew that there had to be others far more capable than I was. I am happy to report to you tonight that I and FTW no longer need to go in that direction. An expert—and I know Julian will protest that label—has arrived and this has made a huge difference for us. It is now vastly more effective for me and FTW to say that on the key issues of relocalization, downsizing and sustainability, we encourage everyone to look to the Post Carbon Institute for guidance and leadership. Julian has invented that wheel for us. We only need a few more and we can make a wagon to take us down survival’s path.

As a result, I and FTW are free to return to what we do best: geopolitical and macro-economic analysis. Since our recent move to Ashland, Oregon, we have hired three new staff. We have increased our production of original stories by more than 50% and we plan on doubling our output within the next four months. In this way FTW can work as a strategic partner with the Post Carbon Institute and all of the other great groups that have come here to New York to provide what no one else can: an early warning system and the kind of analysis that will identify hot spots, key issues, trends, and pending crises far enough ahead so that each locality can prioritize its own efforts according to its own needs in light of a rapidly changing global map.

This is the way in which those who see Peak Oil for what it is can plan, prepare, and respond as needs dictate. This is the way in which true leadership, whether it be visionary and analytical as is the case with Dimity Orlov, or organizational and educational as with Julian Darley, can make a difference. This is the living embodiment of Catherine Austin Fitts’ maxim that “No one is as smart as all of us.”

Ladies and gentlemen, I would like to present to you my good friend, a man who I respect and admire, Mr. Julian Darley.

CONCLUSION

A well-known Peak Oil activist has already moved into a post-oil paradigm. He has no car. He has no cell phone. He travels only by train to avoid leaving a large energy footprint. Yet at the same time he tries to organize conferences around the country, leaving people who depend on quick responses and decision making to operate at levels not seen since the 1940s or 50s.

Does anyone here believe that Dick Cheney or Hillary Clinton or Fed Chairman Ben Bernanke or any of the world’s business leaders are making such self-sabotaging choices now? They may have to, someday. But for now they are taking every possible advantage, using whatever energy is needed, to prepare and position themselves to stay ahead of what are now certain coming events.

I hate to say it, but perhaps we should take a lesson from our enemies here.

Let us not forget that in order to get to the Post-carbon world that is inevitable we must first survive the collapse and the die off that is inevitable. The challenges of the transition period will be completely different from the challenges of living in a world without cheap energy.

It is the almost complete failure of the Peak Oil movement in the United States—and around the world—to grasp, ponder or even acknowledge these transitions that are pointing to a needed evolution in our approach to education, research, networking, and organizing. Psychologically it is always easier to plan along the lines of a single challenge rather than to try to prepare for chaos on a fluid, multi-dimensional field where serious challenges may be completely different from one day to the next. But the easiest path is not always the best choice.

The maxim that I live by is that what we need today, right now, is not a plan, but options. Plans do not bend well. They tend to break. And with breaks in plans come break downs in function. The only plan that I live by today—the only plan that I recommend to our subscribers—is to increase one’s options as much as possible and to selectively choose those options based upon what is happening in the world now and what those developments might mean for the future.

I would submit to you tonight that perhaps a more important question that needs to be answered first is: “How do we get from a civilization where collapse and dislocation is just beginning to a place where we can prepare to transition away from oil and gas when the time is appropriate”?

John Lennon once wrote that “Life is what happens to you while you were busy making other plans.” This movement needs to reflect on that.

A dear friend of mine, Dr. Faiz Khan, once said that a paradigm is what you think about something before you think about it.

If the global economic paradigm that we live under dictates infinite growth, then we must disengage individually and by community from that paradigm.

If the activist paradigm that we live under says that we must slow down the process of reform and planning to make room for all and offend no one, no matter how much they may slow down or confuse the process, then we must disengage from that paradigm. This is no longer about protracted—and almost always ineffective—social change. This is about survival. I refuse to die, and I refuse to encourage anyone else to risk death or to slow down for or argue with people who are either incapable of understanding, too lazy to do the necessary homework, or too tightly wedded to old ideas.

Are these old ideas and cherished values and principles now luxuries or necessities? We will each make our own decisions, and in a world that will give us near instantaneous feedback. We will suffer or prosper, we will stop or continue, we will live and die accordingly.

Buddhist philosophy teaches us that life is suffering. It is amazing how much joy and liberation can be achieved from that viewpoint. It has to do with lowering expectations so that little pieces of joy and cause for celebration are more accessible to our hearts and minds.

Judeo-Christianity, as practiced in America, tends to make us all believe that if we are spiritually and morally correct, we will be rewarded with abundance. As Dmitry Orlov observed, Christianity in other parts of the world teaches that the path to salvation and redemption lies through suffering and denial. Which is it then?

If the spiritual or religious paradigm that you live under influences your thinking in either direction, then that paradigm is your enemy and my enemy. What is it that you think about before you think? Find it, identify it, and discard anything that is not a survival necessity.

The only thing that the universe is offering the human species now is the opportunity to change—to evolve…or to perish.

Perhaps there is a new understanding of God awaiting those who survive. I have long held the personal belief that religion is for people who are afraid of going to Hell and that true spirituality is for those who have already been there.

What I do know, because I have faced many survival challenges in my life, is that the less baggage one takes into any survival situation, the more likely one is to survive.

Perhaps this philosophy is best summed up by one of my favorite quotes of all time. In his classic science fiction novel Dune, Frank Herbert wrote:

I must not fear.
Fear is the mind killer.
Fear is the little death that brings total obliteration.
I will face my fear.
I will permit it to pass over me and through me.
And when it has gone past, I will turn the inner eye to see its path.
When the fear has gone there will be nothing.
Only I will remain.