Avoid the fossil fuel trap
In conversation with Joseph Doucet (now the Dean of the University of Alberta School of Business).
Sponsored by the Circumpolar Institute at the University of Alberta
December 9, 2010
Follow the PowerPoint presentation:
I will start with an AA type of confession to my addiction. I admit that I am the epitome of the pinko, left-wing cyclist, that Don Cherry ranted against. I admit that I cycle through winter on Edmonton streets, butting aside cars as I go, and would do so in Rob Ford’ s Toronto, if I lived there.
In a great leap, I want to shift to a man of equal wisdom to Don Cherry – to Mohandas Gandhi, India’s spiritual leader. ‘There is enough for everyone’s need, but not enough for anyone’s greed’. This quote expresses the vision underlying my talk. Gandhi never stepped foot in the North, probably never thought about it. But, his vision is universal and applies to Canada’s north as well as anywhere on earth.
Ever since Europeans got it into their heads to find a northwest passage to Asia, a long line of European explorers and developers from Franklin on, made sure to impose their interests and their model of development on the North. It’s still happening. For better or worse, the North is not isolated from the rest of the world.
I’m going to talk about the imperative to adop a new paradigm of a conserver society that also serves up social justice, as the world faces the imminent end of cheap oil and escalating natural disasters caused by human-made climate change. Finally I look briefly at how all this will affect the North’s future alternatives.
My main argument goes as follows: The era of cheap oil in the world will end very soon, probably within the next five years. The North has a choice of whether to join in the last gasp of fleeting fossil-fuel extraction and incur long-term environmental damage, or embrace the coming low-carbon, powered-down economy of the future. Thinking long-term, it’s wiser to choose the latter so the North avoids becoming locked in a fossil-fuel belt, analogous to Detroit’s rust belt.
Those coming from the capitalist model and transnational corporations will label my perspective ‘pessimistic’. I reject that. There’s lots of evidence to show that the world is at the brink of peak oil and peak many other non-renewable resources. But it is nowhere near peak equality, peak social justice, peak real democracy from below, peak living in tune with nature, and peak human happiness derived from the things that matter most in life. Once our basic needs are met, we get much more satisfaction from valuing each other and nature than from valuing more stuff. I believe we can develop that kind of society. That’s why mine is the optimistic perspective here.
To get there, we must make a cultural turning, an economic turning and a political turning. Business as usual is a death economy, where it’s considered acceptable to drill in the deep ocean, including the Arctic Ocean, even if it risks exterminating whole species of life. 153 days of blowout from BP’s Macondo well in the Gulf of Mexico did great damage to many bird species and fish. It was a death well. Don’t allow death drilling in the Arctic Ocean.
The oil TNCs and those that preach the mainstream economic doctrine bring this model to the North. They will admit that it’s impossible to eliminate risk altogether, but will assure us that the risk is minimal – where have we heard that before - and the risk is worth it. Worth what? One generation of riches, mainly flowing out of the North to southern transnationals, in return for eons of dead species and an uninhabitable ocean and terrain. A few more years of well-to-do humans addicted to an unsustainable oil economy whose emissions are fouling the fragile atmosphere that humans and most other life forms depend on to live. The oil TNCs owners will not have to live with the consequences of the environmental disasters in the North. Their only calculus is how much money their corporation can make. Then they’ll move on to exploit and damage other parts of the globe.
The alternative is to start the transition to a new, powered-down economy, fuelled by an ethic of living together better and with nature. If the North doesn’t do this or Alberta for that matter, both will be caught in a fossil fuel belt, a region like a ghost town, while the rest of the world has moved on.
We can’t wait for the market to get us to the next economy. Look what the market did to the automobile rust belt of Michigan, Ohio and southwestern Ontario – abandoned factories, and communities. The market didn’t bring those jurisdictions to the next economy. It won’t bring the North it to either. If the North chooses the short-term resource boom with all its social, drugs and environmental damage, it will be left behind, much worse off, while the world has moved on. Northern communities and governments must plan to create the transition to a new economy, not wait around to be a victim to market and transnationals’ whims.
I am not an expert on the North. Most of you here probably know more about the north than me.
I do not have a romantic view of the North. Northerners have just as much right to live in good, heated houses, drive snowmobiles, use GPS, cellphones and the Internet, and derive as much comfort from modern technology as southern Canadians. [Let’s hope humans will be long-sighted to conserve enough oil so that in a 100 years they can still make the rocket fuel needed to keep the satellites in the sky and keep the Internet going.] Modern communications technologies are even more valuable in the North, where the land is beautiful but unforgiving of those who get lost.
So I am not against new technologies, nor do I wish to preserve all of the past.
But we cannot go on burning through fossil fuels, that took the earth tens of millions of years to store sunlight from plants. We have cavalierly used up the cheapest and easiest part of those resources in 150 years, most of them in the past few decades. The end of cheap oil will mean the relocalization and renationalization of economies and societies. Distance will matter again and act like a huge tariff barrier against distant products, as it has in most of human history. We can either deny that and attempt to continue with business as usual which will result in sudden collapse, or we can start preparing now to powerdown and see it as an opportunity to build a more egalitarian, democratic and just society in tune with nature.
To get there we need a paradigm shift from the current predatory, corporate capitalism and empire that is leading to destruction. It, and oil at $147 a barrel in July 2008, caused the Great Recession from which the world has not recovered. Neo-conservatism or neo-liberalism was based on a faulty paradigm. John Kenneth Galbraith put it well: “We can safely abandon the doctrine of the eighties, namely that the rich were not working because they had too little money, the poor because they had too much”.
After denouncing Keynesianism for 30 years as throttling the entrepreneurial spirit and limiting the riches of the super wealthy, those who impose the Washington consensus on the rest of the world suddenly rediscovered Keynes when their part of the economy was collapsing.
Unfortunately they used Keynesian ideas only to save the rich, the banks and the giant corps - too big to fail - and let ordinary people lose their homes and jobs. Bail out the rich speculators with trillions. Socialism for the rich and laissez-faire, don’t care, capitalism for the rest. Should be the other way round. Let those who espouse cut-throat, capitalist competition, die by their own shibboleths. And a carbon-free, caring, sharing, society for the rest of us.
If Keynes was used properly on behalf of ordinary people and for nature, his ideas could get us out of the Great Recession, like they did the Great Depression of the 1930s.
I will quote from a brilliant article Keynes wrote in 1933 “National self-sufficiency”. These are ideas from Keynes that we rarely hear. They go way beyond the demand-side, counter-cyclical government spending ideas that the name Keynes invokes.
These ideas are much more radical and apply well to Canada’s North, as territorial or local self-sufficiency. They also provide a map of how to transition off fossil-fuel created, corporate globalization.
Keynes begins: “I was brought up, like most Englishmen to respect free trade … almost as part of a moral law. I regarded ordinary departures from it as .. an imbecility and an outrage … I was writing that free trade was based on fundamental ‘truths’”.
Free traders believed they were serving the great cause of liberty, of freedom for personal initiative against the forces of privilege and monopoly and obsolescence.
But Keynes started to question the received wisdom of neoclassical economics.
“The divorce between ownership and real responsibility of management is serious within a country …But when the same principle is applied internationally, it is … intolerable – I am irresponsible towards what I own and those who operate what I own are irresponsible toward me … remoteness between ownership and operation is an evil in the relations among men.”
“I sympathize, therefore, with those who would minimize, rather than with those who would maximize, economic entanglements among nations. Ideas, knowledge, science, hospitality, travel – these are the things which should of their nature be international. But let goods be homespun whenever it is reasonably and conveniently possible, and, above all, let finance be primarily national.”
“Most modern processes of mass production can be performed in most countries and climates with almost equal efficiency … national self-sufficiency … may becoming a luxury we can afford”.
Taking a shot at what we now call globalization, Keynes wrote “we do not wish, therefore, to be at the mercy of world forces working out … some uniform equilibrium according to ideal principles … of laissez-faire capitalism .. we wish to be our own masters”
“We need to be as free as possible of interference from economic changes elsewhere, in order to make our own favourite experiments towards the ideal republic of the future; and that a deliberate movement towards greater self-sufficiency and economic isolation will make our task easier.”
My final quote is Keynes on the environment, written in the same 1933 article:
“We destroy the beauty of the countryside because of the unappropriated splendors of nature have no economic value. We are capable of shutting off the sun and the stars because they do not pay a dividend”
There, Keynes showed he is timeless and relevant to current issues.
In his book, The Great Turning, David Korten, a former professor of business at Harvard University, writes about a competition between two models
This is how he characterizes the models: [Show slide]
Dominator / Empire
Partnership / earth community
Life is hostile and competitive
Humans are flawed & dangerous
Order by dominant hierarchy
Compete or die
Defend the rights of the self
Life is supportive & cooperative
Humans have many possibilities
Order through partnership
Cooperate and live
Defend the rights of all
Relevance of the partnership, conserver model for Canada’s North
Peak Oil and climate change will make the cost of much global trade prohibitive re imports, but also re exports lost.
Let’s start to make the cultural, economic and political turning by pro-actively relocalizing the economy so that it is subordinated to society and citizens. The latter need to hold community meetings within the diverse nations and groupings in the North to decide on the North they want.
The first questions Northerners need to ask themselves is what’s an economy for, whose economy is it? Those questions go against the dominator / empire model because they presume that citizens have the freedom and intelligence to create their own economy in a cooperative, democratic way.
The goal of an economy should be strong communities, healthy kids, caring, resilience, security.
The new economy values life, power in community, rebuilds community, converts phantom, financial fictitious wealth into real wealth.
Think holistically – shared prosperity, ecological balance, healthy biosphere, democracy as a living practice.
What do these principles mean in reality?
Look at things the North imports and figure out sector by sector, which areas are most amenable to import substitution
From energy, food, consumer goods, services, health care and education.
I see that northern govts are already taking some of these steps and are far in advance of Alberta’s govt and corp elite who are exemplars of the empire, dominator model.
For example the 2009 report ‘Paths to a renewable North’ was a pan-territorial endeavour.
It starts off from the right premises:
Providing energy to meet the needs of the people, communities and industry is critically impt.
Because global warming is melting permafrost and changing ice conditions,
The territories recognize their responsibility to control their own emissions
Energy conservation is key
Imported fossil fuels are expensive and emit greenhouse gases
It is agreed that the cost of oil will remain expensive and that dependence on imported fossil fuels puts northern territories at a disadvantage.
Strong partnerships are needed across first nations, Metis, Inuit, businesses and govts
It seems that Northerners are more clear headed than southern Cdns.
The report then assesses the feasibility of expanding renewables – hydro-electricity and wood – that are already in widespread use – and the new ones – wind, solar, geothermal and tidal power
Similarly the Yukon’s Energy Strategy report starts with these principles:
Building an environmentally, economically and socially sustainable energy sector
I don’t have the expertise to suggest exactly how applying the vision of an inwardly- directed economy and environmental policy could work in Canada’s North, but know that the export-oriented, resource boom will not help. Think ahead, not just ‘til the next quarter’s corporate earnings report, but one generation or seven generations ahead. As Peter lougheed said about Alberta, the most important resource is water not oil. I can imagine an Alberta without oil, but not without water. The same goes for the North.
The North should reject the twilight era of extractive industries and embrace the new vision of conserver, partnership communities. So should we all. Join Ecuador and other countries and leave the oil in the soil. Heed Gandhi’s wisdom that there is enough for everyone’s need, but not for anyone’s greed.