Monday, February 27, 2012

Bluebonnets sightings are not that far off...

A Fog of Mendacity

     Those frightening sounds, sights, and odors on the wind this foreboding snowless winter - like emanations from some back ward of a global psychiatric hospital - are the signs of a nation going completely mad. The traumatic rise of oil prices above the $100 level is one irritant, prompting a range of people-who-oughta-know-better to gibber and fulminate as though they'd been locked in the nation's attic since Thanksgiving with nothing to do but play with a box of pencils. Meanwhile, several absurd "narratives" circulate around the mainstream media that are sure to cause this country more trouble - as any set of pernicious untruths will.
     One popular new lie is that US oil production is suddenly so robust that America is about to become a leading world oil exporter again - which is completely untrue. The lie arises at the intersection of wishful thinking and the willful misuse of statistics. It was trumpeted by the appallingly credulous Tom Friedman in his Sunday New York Times column, of all places, and it shows how effective the oil and gas industry's propaganda campaign has been.
     A lot of the wishing comes out of the shale oil and shale gas sectors. Those TV commercials you see around the news hours on the cable networks are designed to extract investment capital from elderly people who have been swindled in the bond markets and don't know where to stick their dwindling retirement funds. Shale oil and gas must seem like a good bet to them, especially the ones marooned in retirement housing clusters in dismal places like Arizona and Florida, where not being able to drive is a virtual death sentence.
     The US government is in on this propaganda offensive, especially the Department of Energy's Energy Information Agency (EIA), which routinely issues overly optimistic reports about future oil production. The political spin is a quixotic effort to promote another commonly touted lie about the future: that the US is approaching a point of "energy independence." You'll know we got there when you have to walk to your new job weeding the potato fields. The mendacity behind this propaganda is strictly the wish of politicians to avoid telling voters the truth, out of sheer cowardice for the consequences. US Energy Secretary Steven Chu will go down in history as a pathetically passive quisling, who thought he was honest and patriotic by standing in the background and keeping his mouth shut.
     In fact, a lot of the propaganda behind the current madness is based on the incapacity of Americans to imagine daily life without all the cars. One very active drummer on the propaganda scene is John Hofmeister, former CEO of Shell Oil. About a week ago he debated Tad Patzek, a petroleum engineer from the University of Texas. Hofmeister's rap is based on one central fallacious idea: that American life can only continue if we keep all the cars and trucks running. Any other outcome is unthinkable, off the table. To put a finer point on it, he insists that our national identity and destiny are tied to "personal transportation," code for car dependency. The debate was therefore absurd and Patzek was way too polite. He never challenged Hofmeisiter's core idea.
     The public's gross misunderstanding of these issues arises over a set of mis-statements made in recent years especially focusing on the Bakken shale oil basin on North Dakota, the various shale gas plays around the country, and the tar sands of Canada (which so many spinmeisters seem to regard as belonging to the United States). The true state of the US oil industry is that we only barely stalled a 40-year decline in oil production by throwing massive amounts of money (capital) at oil reserves that are very expensive and difficult to get. In so far as we've entered the terminal stage of a long debt cycle, one thing we can be sure of is a shrinking pool of real capital investment. Hence the frantic propaganda effort to funnel remaining available money into the shale plays.
     A companion fantasy to all this is that the US has a hundred year supply of natural gas. President Obama is guilty of this whopper. (One commentator, financier Bert Dohmen, made the ridiculous claim in a recent podcast on the Financial Sense News Network, that the US has a thousand year supply.) These are the kinds of irresponsible statements that will eventually inflame a public yet again swindled by authorities they desperately want to trust. The truth is we probably have perhaps a seven-year supply of shale gas, and maybe  20 of all gas including the regular old conventional gas. And even that could easily be reduced by the disorders in capital formation now underway in the destabilizing banking sector.
     In any case, all this wishing and lying is about to collide with price volatility to make the American voting public absolutely batshit crazy with dread and anger. That, of course, will only prompt more lying, whopper-spinning, and grievance-flogging in the political arena. It will be nearly impossible for the public to evaluate reality. In the meantime, those disorders in banking and financial markets are close to running out of control. Events are tending ever closer to criticality. I believe they will be expressed in political violence around the major party conventions this summer. Those will be interesting fog-lifting weeks.

Sunday, February 26, 2012

Durant, OK

Monday, February 20, 2012

The Choices We Make
By James Howard Kunstler
on February 20, 2012 9:41 AM

The misalignment of politics and reality threatens to scuttle both major parties, but it's especially gratifying to see the Republicans sail off the edge of their own flat earth on the winds of religious idiocy. For forty years it has not been enough for them to just be a conservative party. They had to enlist the worst elements of ignorance and reaction, and they found an endless supply of it in the boom regions of the Sunbelt with its brotherhood of TV evangelist con-artists and a population fretful with suburban angst.

Now, in the last hours of the cheap oil economy, the forty year miracle of the Sunbelt boom dwindles and a fear of approaching darkness grips the people there like a rumor of Satan. The long boom that took them from an agricultural backwater of barefoot peasantry to a miracle world of Sonic Drive-ins, perpetual air-conditioning, WalMarts, and creation museums is turning back in the other direction and they fear losing all that comfort, convenience, and spectacle. Since they don't understand where it came from, they conclude that it was all a God-given endowment conferred upon them for their exceptional specialness as Americans, and so only the forces of evil could conspire to take it all away.

Hence, the rise of a sanctimonious, hyper-patriotic putz such as Rick Santorum and his take-back-the-night appeal to those who sense the gathering twilight. And the awful ordeal of convictionless pander and former front-runner Mitt Romney drowning in his own bull**** as he struggles to extrude one whopper after another just to keep up with the others in this race to the bottom of the political mud-flow.

There is an obvious dither backstage now among those who cynically thought they could manipulate and control these dark impulses of the frightened masses as the candidates all pile into a train wreck of super-PAC obloquy. Won't some level-headed adult like the governors of New Jersey and Indiana step up and volunteer? Is this finally its Whig Moment - the point where the Republican Party has offended history so gravely that it goes up in a vapor of its own absurdity? I hope so. The conservative impulse is hardly all bad. We need it in civilization. But it can't be vested in the sheer and constant repudiation of reality.

The opposing Democrats have their own problem with reality, which is that they don't tell the truth about so many things despite knowing better, and, under Obama, they act contrary to their stated intentions often enough, and in matters of extreme importance, that they deserve to go down in flames, too. Just as there is a place for conservatism in civilized life, there is also a place for the progressive impulse, let's call it - for making bold advance in step with the mandates of reality and an interest in justice for all those along on the journey.

The Democrats under Obama don't want to go to that place. They want to really go to the same place as the fretful Sunbelt fundamentalists, but by a different route - and that place is yesterday, by means of a campaign to sustain the unsustainable. Mr. Obama is pretending that an economic "recovery" is underway when he knows damn well that the banking system is just blowing smoke up the shredded ass of what's left of that economy. He pretends to an interest in the rule of law in money matters but he's done everything possible to prevent the Department of Justice, the SEC, and a dozen other regulatory authorities from functioning the way they were designed. He has never suggested resurrecting the Glass-Steagall Act, which kept banking close to being honest for forty years. He never issued a peep of objection about the Citizens United case where the Supreme Court tossed the election process into a crocodile pit of corporate turpitude (he could have proposed a constitutional amendment redefining corporate "personhood."). He declared he'd never permit a super-PAC to be created in his name, and now he's got one. Mr. Obama represents a lot of things to a lot of people. He is mainly Progressivism's bowling trophy, its symbol of its own triumphant wonderfulness in overcoming the age old phantoms of race prejudice. Alas, that's not enough. Where exactly is the boundary between telling "folks" what they want to hear and just flat-out lying?

Neither party can articulate the current reality, which is that we have to reorganize civilization pretty drastically. I've reviewed that agenda many times in this space and it largely amounts to rebuilding local economies at a smaller and finer scale. That is just not on the table for all current leadership, or even in the room. If neither party can frame an agenda consistent with that reality, then we'll have to get there without them, probably after a very rough period when the pretending still lingers in the air like a bad odor and no reality-based consensus is able to form, no agreement about what we should do. That's the period when a lot of things fall apart and people get hurt. These are the choices we're making right now. 

Monday, February 13, 2012

The John Brown Moment

     When Gaia gets pissed off enough at the antics of humanity, she sends in her hit-man, Reality, to settle accounts. Reality is blessed with a cloak of invisibility. The human race is so busy concocting stories about what it is doing, that Reality steals onto the scene unnoticed - until bodies start to fall over, and the sort of bad political weather known as a shit-storm fills the skies, the streets, and the assembly halls.
     One of the cockamamie stories circulating this week is that the Euro bailout of broke member nations is fait accompli, baked in the cake, a done deal, no problemo, because the December 2011 Long Term Refinancing Operation makes it so. The European Central Bank can supposedly eat bad bond paper until the cows come home without choking to death at the same time that it can run a back-door money-printing racket without the results showing up in currency degradation. And the Greeks will bend over and receive what they've got coming good and hard because, well, they are Greeks, and it is their way!
     Excuse me, but something's got to give. History is a lot of things, but it is not silly putty. Its cousin, Reality, slips through it performing its deeds one way or another. The Greeks have lately remembered some of their own history. The Germans have beset them before, they now recall, and some of the money currently labeled "debt" may have been filed incorrectly, the Greeks say. It actually belongs in the folder labeled "war reparations." (Granted, it is hard to read folders when you are bending over so far that things look upside-down.) Germany, it happens, remembers too the last time that this folder was flopped out on the table. Things didn't work out so well for the Weimar finance ministry in those dark days ninety years ago.
    Meanwhile, Athens and several other Greek cities ignite in an overture to what might come to be called the European Spring.
     Reality steals onto the scene bearing a message from Mother Gaia: "None of your shenanigans make the numbers add up. The European financial arrangement will blow up because it must." Therefore, expect it to blow up. Germany will not keep pounding sand down the rat-hole of PIIGS insolvency for another year. Anyway, the proverbial can that everyone was kicking down the road - it fell down the rat-hole, too, so there is nothing left to kick except Greek civil servants, both current and retired and, alas, they represent that part of the Greek economy not occupied by olive cultivation, which is to say most of it. It turns out, when you kick Greeks down the road (probably Spaniards, Italians, Portuguese, and Irish, too) sparks fly off them and things catch fire.
     The bottom line seems to be that Europe can either go broke or burn down, or do both. But it can't go back to what it was doing before: pretending to be rich and care-free.
     Over on this side of the Atlantic, America's experiment in pervasive control fraud took a new turn with the pretended "settlement" of massive, widespread, robo-signing allegations that will allow a bunch of "the usual suspect" TBTF banks off the hook from future liability and criminal prosecution resulting from hundreds of billions of dollars worth of swindles. The TBTF banks will have to pay, when all the "principal reduction credits" and other dodgy subtractions are made, a couple of billion altogether, which is obviously little more than a cost of doing business for such supernaturally fabulous returns. And then that is supposed to be the end of the whole disgusting episode.
      Last to cave in on this legally squooshy agreement between fifty states was New York's own Attorney General Eric Schneiderman, newly enlisted in the elite national corps of cads, bounders, and sell-outs. This was the week that the same Schneiderman agreed to lead President Obama's so called Mortgage Fraud Task Force, which, any child of eight can see, is a smokescreen to conceal the fact that the US Department of Justice has failed to initiate any action whatsoever in the vast and gruesome pageant of fraud that has transformed the rule of law into a rule of larceny.
     Do you think the late Whitney Houston was a lost soul? Then look for the soul of your country - if you can find it in the wilderness of self-denial, self-double-dealing, and suicidal self-perfidy that it has blundered into with eyes wide shut. No lie is now too big for the United States to swallow. If Europeans ignite and blow up when kicked down the road, here is what will happen to America: it will blunder down its own road until it reaches the next John Brown moment. John Brown put his proverbially famous body in the middle of that road some ways back. He mounted an insurrection at Harper's Ferry, Virginia, in an attempt to fast-track the abolition of slavery. Brown was hanged in 1859, but less than two years later the Civil War commenced, the greatest convulsion in our history. So far.
     Slavery was yesteryear's abomination in America as pervasive control fraud is today's. Somewhere out in America right now is the new American John Brown, a righteous fanatic whose act is waiting to alter the course of history. The next John Brown will also precipitate what was a long time coming. Reality is busy in the background, even while we blog and dither, setting things up. 

Friday, February 03, 2012

...On the square during Dickens 2010...