Category Archives: ecology

It is the cooking method stupid! – insights into energy usage and carbon dioxide production in the food production-consumption chain

By Alan McCrindle

The Take away – The most important variable in energy consumption and carbon dioxide production in food is in your hands – the way you cook your food is the major leverage point in the total food production-consumption system – are you cooking with the lid on the pot?

The Background – The Rise of Global food supply chains has people concerned that this is reducing sustainability and accelerating global warming by increasing carbon dioxide emissions and energy consumption

With the rise of globalisation it is no surprise that food production has been globalising too. Examples such as Salmon farmed in Canada and flown to China for processing before being flown to California have many people interested in sustainability and global warming up in arms.

One response to this concern, that globalisation of the food chain is contributing to a rise in energy consumption and carbon dioxide production, has led to the concept of food miles – the distance that food travels from where it was produced to where it was consumed. Local food production and local growers markets are also on the rise – in part driven by the desire to have fresher food that has lost less of its nutrients due to long travel times and cold storage.

The Reality – is that the majority of the energy consumed and carbon dioxide produced in the total food chain is produced by the consumer in cooking the food and driving to buy it

While one response is to feel relatively powerless against the perceived “monster of globalisation” for threatening our sustainability, it turns out that our intuitive analysis of the situation is in many cases simply wrong.

The fact is, that in the case of food that we buy and cook at home, we the people are responsible for the largest use of energy and production of carbon dioxide in the total food supply chain.

For some reason when most of us think about the energy used and carbon dioxide produced with food only think about it in terms of the food we buy in the shops – we forget about the energy that we use to get to and from the shops to buy the food, the energy we use when we cook the food (and wash the dishes) and the energy used in disposing the waste.

When we add these energy consuming stages into the equation to get a full “seed to waste life cycle analysis” it turns out that the major energy consuming steps in the chain are created by us driving to buy the food and cooking the food. And of these two cooking takes up the most energy. And this analysis excludes the energy cost of washing the dishes.

You can see this represented graphically in two charts I found on the internet that measure the total carbon footprint / energy consumption for potatoes and broccoli in the UK.

For those of you who aren’t that good with graphs, the vertical bars in each graph measure the total energy used / carbon emitted to deliver one kilogram of potatoes and broccoli to the plate at home. The different energy consuming steps in this process are represented by the different colours – the hights of each colour represents the amount of energy used in that stage.

As you can see if the case of potatoes, approximately 11 mega joules (M J) of energy is consumed getting a kilogram of potatoes to a cooked state. And when you look at the light blue part of the bar you can see that just over 4 M J – about 37 percent –  is used by us processing the potato at home. And this excludes the cost of driving to buy the potatoes.

In the case of broccoli – the graph compares broccoli sourced from Spain and the UK. The vertical bars measure the amount of carbon dioxide produced in the chain and the light green bars – the biggest in all cases – represent the energy used at home. This varies from around 50 to 60 percent of the total carbon dioxide.

The bottom line is that you can save more energy and carbon dioxide emissions by boiling your potatoes with the lid on the pot than by buying local produce.

In terms of transport economics the car is the most energy intensive form of oil powered transport. A large ship can carry one ton of food 8oo miles on a gallon of fuel. In comparison a train can move the same ton 60 miles, a truck 20 miles and a car 10 miles. When you see these statistics it is easy to see why the cat of driving to the shops to buy food is  a relatively energy intensive part of the food chain.

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New Treasury data suggests that the USA collapse has started

By Alan McCrindle

Back in December 2008 I wrote the post titled “Financial Depth” and sophistication or “diminishing Marginal returns” and Collapse.

In this post I pointed out the trend in the USA of the “Diminishing Marginal Productivity of Debt” as illustrated in the chart below.

The USA economy could start start shrinking as early as 2014

What this trend is pointing out is that each new dollar of debt has been producing less and less economic growth over time – another way of saying that each new dollar of economic growth requires more debt. The trend line on the chart suggested a “zero hour” in 2015 – the point where new debt stopped producing economic growth and started to destroy economic growth.

I suggested that when the USA reached this point it would start to collapse because it would no longer be able to solve any emerging problems.

New problems cost money to solve. But in this state of negative marginal debt productivity any new debt raised to solve the problem would make the situation worse not better. Joseph Tainter had found this to be the common cause of the collapse of 24 civilisations he had studied.

The bad news is that zero hour has already arrived for the USA

New data from the latest U.S. Treasury Z1 Flow of Funds report was released on March 11, 2010. The chart for this data is below. And it looks very very bad. By the end of 2009 each new dollar of debt was destroying 45 cents of GDP.

– the report and update of the chart from this data is available at http://economicedge.blogspot.com/2010/03/most-important-chart-of-century.html.

The exponential mathematics of our capitalist system reveal the inbuilt dynamics of an unsustainable ponzi scheme with a totally predictable outcome

The mathematic underpinning the reason for this trend are simple and are an inbuilt property of our capitalist system which requires exponential growth to function and where new money is loaned into existence . The outcome is entirely predictable and inescapable. Unbelievably this has escaped classically trained economists the world over.

This is how it works.

Productivity growth means that every year the same amount to goods and services are produced by less people. In this situation, if there was no economic growth, productivity growth would result in increasing unemployment. And if population growth was added, unemployment would rise even faster. This type of situation could not last for long – people would soon be starving and the government would be thrown out.

The solution has been to growth the economy fast enough to at least maintain stable employment. In countries like the USA and Australia this requires real economic growth of around 2.5% a year. Anything less and unemployment starts to increase. Real life data from Australia and the USA demonstrates this relationship – the change in unemployment is completely correlated to the contribution that new debt plays in the economy. The correlation for the USA is exhibited below.

Economic growth requires new debt and because this debt grows faster than the economy the debt to GDP ratio increases. In Australia, for example, debt grew 4.2% faster than GDP between 1964 and 2008 (with a correlation coefficient of 0.994).

The end result are the “hockey stick” graphs for debt to GDP ratio’s – the graphs that show the diminishing marginal productivity of new debt to produce economic growth are simply mirror images of these. Eventually interest payments on debt swamp the economy.

We  sustained this growing debt burden by reducing interest rates and pretending that we didn’t have rising debt but rather we had rising profits from the inflated asset prices that this additional debt produced – without this the US economy would have hit the straps long ago. However with interest rates at almost zero there is no more room to move. Game up.

This chart shows how long term interest rates as measured by 30 year treasury bonds have been trending down since the 80’s.

Long term interest rates have been falling since the 80's

We Need to focus on Energy not Money

Yet the type of collapse that Tainter is talking about is not simply driven by financial  collapse – money is easy to debase. It is easy for government to “print” new money and give it new names like “quantitative easing” to hide the fact. Other tactics used by governments of all persuasions are to change the way statistics are collected – typically to make high inflation look lower than it is, to make low economic growth look higher than it is and to make high unemployment look lower than it is.

This is why Tainter uses the concept of Energy rather than money. Energy is what really does the work in the universe.  When a country starts to collapse inflation soars like it did recently in Zimbabwe. A friend of mine from school days who still lives in Zimbabwe and runs a mining business there only works with diesel fuel as his currency for exactly this reason.

What is unrecognised by economists – who deal with money rather than energy, and who look at the world in the relative short term – is the historical development of the human species is a history of our capacity to harness greater and greater amounts of energy per person. This started right back when we learned to use fire. Our use of fire gave us the capacity to cook out food. Cooking allowed us to extract greater amounts of nutrition from our food and this facilitated the expansion of our brains.

The industrial revolution and green farming revolution has been built on the back of fossil fuels and would have been impossible without them. There was a time when food was an energy producer. Now though modern industrial agriculture in the USA is  a net energy destroyer that operates like a miner.

– 10 calories of fossil fuel energy are required to produce one calorie of food.

– Soil and nutrients are being destroyed faster than they are being replaced.

– Nitrogen from fertiliser use is poisoning the environment and

– We are using more water globally than we have (we achieve this by extracting underground supplies of “fossil water” faster than their replacement rate)

In addition to energy we depend on ecosystem services for our survival. The unfortunate story around ecosystem services is two fold. The first is that we are amidst the 6th great extinction and this is being caused by us. Predictions are that we will have wiped out commercial fish stocks by 2050. The second is that we probably started to run down our ecological capital some time in the 1980’s.

Given that we live on a single planet that has boundaries and limits this begs the question – what happens when we run out of easy energy and ecosystem services?

The issue around peak oil is not that oil will run out. The issue is that as the supplies run down the net energy we get from fossil fuels declines. So when we used to be able to get 100 barrels of oil by using one barrel of oil to do the work to get it out of the ground and refined, one barrel of oil will now only produce 10 barrels of refined oil.

There are people who believe that technology will somehow save the day. May be it will, maybe it wont.

Our first Ponzi scheme started with the invention of Agriculture – the history of humanity is the history of successive ponzi schemes as temporary solutions to problems

My hypothesis is that our first ponzi scheme started when we invented agriculture as a solution to the fact that the environment became unable to sustain a hunter gather lifestyle.

This agricultural solution in turn created unintended consequences that we solved with further innovations. The whole history of innovation then has been a story of “solutions” creating new problems that were “solved” in the short run only to create bigger problems down the track.

The moral of the story is that there are no permanent solutions to anything in a world that is constantly evolving. Moreover short term solutions create problems in the future. In other words, one ponzi scheme creates the need of a new ponzi scheme to solve its problems …. and so on.

We are literally surrounded by ponzi schemes that most of us are ignorant or in denial about. Governments are particularly good at running up unfunded liabilities such as future health and pension costs.

Recent research from the Societe Generale revealed the extent to which some governments have hidden their insolvency by hiding most of their liabilities. In the chart below the red bars for each country represent the liabilities that the governments have reported and form the basis that justify their policies and their legitimacy. The green bars represent the “real” situation. Are you panicking yet?

Yet despite the fact that this information is available on the internet I can almost guarantee you that at least 99% of the population are oblivious of this situation. And, if the became aware of it, denial and instant forgetting of it would be the order of the day.

When this observation that solutions eventually become problems is mapped onto the fact that the rate of change and innovation is increasing, it means that we are creating future problems for ourselves at a faster and faster rate. What this means is that new problems created by these “solutions” – which are currently hidden or not yet manifest – will also start surfacing at a faster and faster rate.

And we live in an interconnected 24/7 world where we now  demand “instant solutions” to problems as they arise. The consequence of this is extreme short term thinking. In this situation we are forced to respond to the surface level symptoms of the situation. There is no time to look for the causes and attempt to respond to these. Look at how bail out was presented by Hank Paulson – if we don’t act now we will collapse. And the result is that the majority of the people who didn’t see the GFC coming are still in power and their bonuses are even larger than before the crisis.  At the same time as main street heads south.

At some time in the near future  we will be spending all of our resources trying to solve the problems that are currently “in the pipe line” as they mature into “sales”.

This is when the collapse will occur.

This view of the evolution of innovation, from hunter gather time till now, is brilliantly captured by Sander Van der Leeuw in his presentation titled “The Archaeology of Innovation” than can be viewed at fora.tv

The question is not whether the USA will collapse – it is a question of when.

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Toyota’s Collapse – a sign of what to expect in the future – we grew to fast

“We pursued growth over the speed at which we were able to develop our people and our organisation and we should be sincerely mindful of that.” – Mr Toyoda explaining his understanding of why Toyota is now in such trouble.

I wonder how many more times this is going to be repeated in the near to mid term future?

It doesn’t take a genius to observe that many firms have been doing exactly what Toyota did – and probably even more so.

M&A has been the order of the day method for fast growth for many firms. Cheap money, competition, short term incentives and pushy investment banks have surely driven firms to create for themselves even bigger integration problems that those faced by Toyota.

In addition many of these firms have been reducing head counts and skimping on repairs and maintenance to boost short term returns. There simply have not been enough people on the ground with enough time and experience to make good decisions.

So as interest rates rise,  sales stagnate or decline as consumers continue to stay away because of job cuts or fears of them, it is likely that we will see many more Toyota excuses in the future – we grew to fast.

And the same could be said for the human species and the global economy. But then this is a whole different ball game. Infinite growth on a finite planet is not only impossible but potentially suicidal – but with the majority voting for the political party promising the fastest and largest growth we will only have ourselves to blame.

Alan McCrindle

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The Common root causes of sickness in Bees and Humans – are we both headed towards the same early human caused extinction?

The BBC has an interesting article today that links the decline in bees in many countries to the decline in biodiversity. I agree with the article and have a further take on the subject.

Shock horror – bees are getting sick for exactly the same reasons as humans – they are eating a diet and getting stressed in ways that their systems weren’t evolved for – and the cause is the modern human environment, diet and lifestyle.

Just as we are increasingly eating a diet of processed sugars and carbohydrates – that come from fewer and fewer food sources so are the bees.

Note: Processed and reconstructed variations of corn and soy make up an increasing component of the diet of humans and animals, and this includes bees. One of the ironies is that bees have access to a more diverse diet in cities than they do in the country side – there is now more plant diversity in cities than in the modern farming countryside.

Bees no longer live in stable environments. The bee industry has been commercialised. Bees are now dragged all around the country in trucks to service different farms. This constant change and travel causes stress in much the same way as we humans are stressed by changing jobs, work environments and constant travel. And it should be no surprise that chronic stress weakens their immune systems in the same way as it does ours.

And, to supplement their bland diets and increased workloads, commercial bees are fed simple sugars in much the same way as we feed ourselves sweets, sugary drinks and coffee to keep ourselves going.

The problem for the bees, and poor humans, is that they don’t have choices like the well off humans do. Their environmental choices are set and limited by the environmental conditions created by the wealthy humans who own the businesses that create these environmental conditions and employ the less well off.

The bad news for the wealthy humans is that they are shooting themselves in the foot. If the bees die off the human species will die off too.

The downside of being at the top of the food chain is that we humans are dependent on the survival of the species lower down the food chain for our survival.

While the wealthy have the option of escaping climate change and environmental damage in the short run, by moving location and putting on the air con, the species on which our survival depends do not have this luxury.

99.9% of species that have been on this planet are extinct and we are now in the midst of the 6th great extinction. And this extinction is being caused by us humans.

Alan McCrindle

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What has the UNs idea of Sustainable cities and sub-prime got in common?

 

 

The Economist Magazine has an article titled Sub-prime with the subtitle: Greener thinking for the poorer cities.

 

I like the title “sub-prime” but for a different reason. And I would use the subtitle – “Shuffling deck chairs on the Titanic”.

 

The article talks about World Habitat Day which was marked by a prize rewarding smart urban planning. Habit is a United Nations’ organisation tasked with improving our urban fabric. In the next 20 years 2 billion people are going to move into cities from the land. That is equivalent to almost one third of the current global population.

 

human-enegy-use-over-time1

 

“It’s the equivalent of adding a Pittsburgh, Manchester, or a Hanoi to the planet every week,” says Michael Cohen of the New School in New York, one of a group of urbanisation experts gathered at Habitat’s headquarters in Nairobi recently to help the agency map out a plan to raise public awareness of a potentially grim future.

The group apparently had a problem agreeing what Habitat’s tentative campaign slogan of “sustainable urbanisation” meant. Apparently, one thought is to emphasise the positives of cities. They can be the solution instead of the end game. Properly managed they can slash emissions, grow knowledge and creativity, and haul billions of poor out of poverty. Really – raising people out of poverty? For how long? That is what the sub-prime housing market in the USA was supposed to do and for a while it looked like it was working – housing prices could keep on increasing for ever couldn’t they! House price multiples of 9 times median earnings were suddenly sustainable in the long term even though historically the sustainable ratio was more like three. 

 

When is humanity really going to wake up to the fact that it is running up an ecological debt – and probably has been doing so since the 1980’s.

 

wwf-humanities-ecological-f

 

“Sustainable cities?” – really. 1984 double speak – hire the spin doctor and create a music clip for MTV, recruit a Hollywood star and everyone will live happily ever after?.

 

It seems like these guys at the UN are smart enough to be able to identify the underlying facts about the nature of the demand of cities on our ecological support system but then fail to take the next step and identify the consequences.

 

From a big picture perspective, these new cities are the equivalent of the new housing stock created by the sub-prime lending in the USA. They are adding to an unsustainable debt burden to the planet that will eventually burst.

 

 Just like the sub-prime housing debt market in the USA was the straw the broke the camel’s back of an unsustainable global financial debt, the sub-prime ecological debt market, created by new cities, will be the straw the breaks the back of an unsustainable global ecological debt. People moving from the land to the cities will at least triple their energy consumption

 

The earth is heading for it’s Titanic iceberg moment. This time we have the data. We don’t need rocket science to work this one out. The mathematics is very simple. 

 

Consider this question. Imagine there is a pond with lilies growing in it. The surface area of the pond covered by the lilies doubles each day. The pond starts empty and is fully covered by the lilies on day 30. On what day is the pond half covered by lilies? The answer is day 29. In other words right up until day 29 everything looks fine and we still have a lot of room to play with. Then it all goes wrong very quickly.

 

We are not dealing with linear issues – moreover we don’t just have the one exponential issue –  we have multiple exponential growth factors combining with each other like population growth, energy consumption and per capita consumption on non renewable resources. We might well ask ourselves – if we use the lily in the pond model, what day are we on?

 

The powers that be – like this example of the UN – are smart enough to get the basic numbers right, this is not the issue. It is what happens to those numbers – how they are interpreted – that is the issue. Analysis will show that the global and national institutions that run the show have a world view that was shaped by past experience. This is normal. The problem though is that what we called “progress” and successful in the past, in a planet where the global human population was much smaller and only a small proportion of that enjoyed the benefits of that progress and success, has now turned into a problem which threatens our survival in this new environment.

 

As Einstein said – you can’t solve a problem with the same level of thinking that caused it. Progressive, enlightenment thinking, reductive science, competition, free-markets, democracy – these are belong to the world view or thinking that delivered us this personal freedom and economic growth that we take for granted and are even today fighting for. 

 

I don’t want to go back to an authoritarian or war lord past or live in a cave. So what is to be done?

 

Clearly we are finding it difficult to come to terms with the fact that our world view is inadequate. The first step is to acknowledge this and change our language. We need to stop calling free-markets a success and stop deluding ourselves that the growth of cities can be sustainable.

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Diminishing Marginal Returns and Societal Collapse – How close is the USA to the tipping point?

debt-contributionserendipitythumb

 

 

 

 

Yesterday I came across this chart . I am assuming it is using the correct data but I haven’t checked. If the data and the trend line are correct we should be very worried – very very worried. Why?

 

This chart is measuring the economic return from new investment in the USA. It is suggesting that there is a trend of diminishing marginal returns. The latest data suggests that for every dollar of new debt there is only 20 cents of economic growth and this could hit zero by 2014. A resurgence of the oil price could speed this process up.

 

And when the incrimental debt to incrimental debt ration dips below zero new investment will start to shrink the economy rather than expand it. 

 

Why we should be concerned with this is that Joseph Tainter, author of The Collapse of Complex Societies, discovered that the common cause behind the collapse of 24 societies that he studied was “diminishing marginal returns”.

 

The story of human progress is a story of our increased capacity to harness and use energy – our modern western lifestyle requires nearly four times the amount of energy per person to maintain than it did 100 years ago. This has only been possible because of cheap oil and this will not last forever.

 

 

human-enegy-use-over-time

 

Moreover, the infrastructure and economy of the USA has been built on the basis of cheap oil and cheap transport. This has left the US economy with very poor resilience.

Tainter’s study showed that as societies become more complex they create problems that they try to solve by adding greater layers of bureaucracy. This complexity costs energy. All around the world we see governments growing larger and consuming a greater proportion of GDP. Even the Republican party – the party of small government – has increased quickly under George Bush. And the latest round of bailouts are a further example of the added costs of government costing more money to try to solve problems brought about by the complexity of financial derivatives.

 

Tainter is not the only historian to suggest diminishing marginal returns lead to societal collapse. Thomas Homer-Dixon has suggested that societal collapse occurs when the Energy return on Energy Invested, or EROEI, approaches 1:1. When EROEI falls below 1:1 it takes more than one unit of energy to harvest one unit of energy and collapse occurs – in today’s world energy and money are equivalents.

 

Tainter describes collapse occuring by one or more of 3 models

 

1. The Dinosaur

2. Runaway Train

3. House of Cards

 

By his definition we fit the Runaway Train model as a society that only functions when growth is present. We are a suicide machine and capitalism is a runaway train. Look at how China is responding to a fall in economic growth from 11.9% to a projected 8% – it has committed over $600B to re-stimulate demand. Even at a growth rate of 11.9% China is only generating 12 million new jobs a year. It needs to generate 24 million new jobs p.a. just to keep unemployment at 25%. So even at this rate unemployment is increasing at the same time as inequality is increasing. (Source Asian Development Bank).

 

In his recent book, The writing on the Wall China and the West in the 21st Century, Will Hutton quotes that China is destroying it’s arable land at the rate of 5% p.a. This seems unbelievable to me and I have not been able to find a source to confirm it. You don’t have to be very good at maths to work out that at this rate of destruction there would be no arable land left in 20 years.

 

And for those people who suggest that technology will come along and solve the problem, I have two questions. What money will we use and who will invest if the environment is unstable? History has shown that innovation only occurs in stable environments. The human race is rapidly losing its resilience. Democracy is an unaffordable system for the whole planet. It has only appeared succesfull because we measure success in the short term and its benefits have been confined to a few.

 

The history of human civilisation could easily be simplified into two parts – pre and post industrial revolution. In almost any chart you look at that has anything to humans over the last 50,000 we inevitably see the same “profile” – the classic hockey stick shape with exponential growth in the last few hundred years.

550px-population_curvesvg

Pre-industrial life has been called a Malthusian trap. Any extra energy that was captured by human’s ended up as extra population rather than as an investment in technology and an increase in average per capita energy usage. I heard the historian Niall Ferguson describe this period as largely a story of subsistence farmers dominated by a few elites. My opinion is that this is an over simplification but the point is that there is an equilibrium between energy harnessed by humans and energy used by humans and this is especially the case in populations that did not posses the technology to store food surpluses.

Modern technology has not only given us the capacity to store food surpluses but it has also given us the capacity to increase the “energy yield” for a given area of land. This has allowed us to increase the carrying capacity of the land. But how sustainable is this? What would happen if energy became more expensive? How much of technology is really only a way of “stealing our future” dresses up as “progress”.

 

Take the example of Australia. Before the arrival of white settlers Australia was home to between 700,000 and 900,000 Aborigines. Given that they had been here for at least 50,000 years it is probably safe to assume that this was the equilibrium population level for their level of technology. Compare this to the current population of approximately 23 million where Australia is a net food exporter.

But look at bit deeper and you will discover that this has come at a cost. As a result of “modern” farming methods least 25% of the original agricultural land has been turned into desert or has such a high salt content in it that it can’t be used for agriculture. Aquifers have been pumped dry and the water for the major farming area is over allocated. The food production and distribution system is totally dependant on fossil fuels for fertilisers and mechanisation. But fossil fuels are set to run out and will become more expensive before they do.

Anyone who looks at these facts and denies that we have “stolen from our future” and destroyed our capital to get where we are is in denial.  And what is our response? To look for further economic growth and population increase. This is insanity.

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