ONE TOWN SQUARE: at the intersection of peak oil, climate change, and land use

Oxford researcher Jörg Friedrichs in a new article asks, what is likely to happen if peak oil occurs?

While a global peak of oil production would be a planetary event, reactions would differ in different parts of the world. Globalization has been fueled by cheap and abundant energy, traded as a commodity on a free market. Increasing conflict over scarce energy would undermine the very foundations of the world’s social, economic, and political systems that have developed over the past few centuries.

To answer his question, Friedrichs focuses on oil importing countries, which constitute the vast majority of states. He looked at three historical examples, which suggest three possible “peak oil trajectories” – paths that different countries might take in responding to peak oil:

• Japan and predatory militarism. The specter of future resource shortages had played an important role in shaping Japan’s imperialist strategy ever since the end of World War I. When an American oil embargo became imminent in 1941, Japan preemptively attacked the US Naval Base at Pearl Harbor and radicalized its war of conquest in order to gain access to the rich oil supplies of the East Indies.
• Korea and totalitarian retrenchment. In North Korea after the end of the Cold War, subsidized deliveries of oil and other vital resources from the Soviet Union came to a halt. The “Hermit Kingdom” reacted in a shockingly reckless way. Elite privileges were preserved while hundreds of thousands of North Koreans died from hunger.
• Cuba and socioeconomic adaptation. Cuba, like North Korea, suffered an abrupt end to subsidized deliveries from the Soviet Union. While this plunged Cuba into a deep crisis, there was no mass starvation comparable to North Korea. Instead, Cubans relied on social networks and non-industrial modes of production to cope with energy scarcity and the concomitant shortage of food – and were actively encouraged to do so by the regime in Havana.

Friedrichs dismisses “techno-optimists” who believe the world can transition to other energy sources, citing the example of the American South (which he calls “Dixieland”) after the Civil War. Southerners only had to look to the North of their own country for investment and innovative technologies – yet it took well over a century to make the transition. Moreover, a similar energy ‘‘upgrade’’ does not seem to be available in the event of peak oil.

Freidrichs expects that peak oil will not lead either to immediate collapse or a smooth transition, but rather to painful adaptation processes that may last for a century or more, as people do not give up habits easily.

Friedrichs thinks that countries prone to military solutions may follow a Japanese-style strategy of predatory militarism. Countries with a strong authoritarian tradition may follow a North Korean path of totalitarian retrenchment. Countries with a strong community ethos may embark on a Cuban-style mobilization of local resilience, relying on their people to mitigate the effects of peak oil.

What’s his prognosis for the U.S.? Most likely, predatory militarism. The U.S. is by far the most militaristic country on the planet. How much the U.S. spends on its military adventurism, and the percentage of global spending U.S. spending represents, depends on what you count. For the 2010 fiscal year, the base budget of the Department of Defense was $533.8 billion. Adding spending on “overseas contingency operations” brings the sum to $663.8 billion. Defense-related expenditures outside of the Department of Defense constitute between $216 billion and $361 billion in additional spending, bringing the total for defense spending to between $880 billion and $1.03 trillion in fiscal year 2010. No matter how you add it up, U.S. “defense” spending far exceeds that of the largest spender, China, whose official budget is a paltry 77 billion (but others estimate China’s spending on the military is in reality much higher, perhaps in the range of $121 billion). Once-mighty Russia’s military spending has most likely dropped to a pitiful $20 billion or so (although DoD swears it’s more like $70 billion). The Stockholm International Peace Research Institute (SIPRI)’s 2009 Year Book on Armaments, Disarmament and International Security pegs global military expenditures for 2008 at $1.464 trillion. SIPRI calculates that U.S. military spending is 41.5% of the world total. Other calculations put the U.S. share as high as 48%.

Does anyone seriously expect that, when faced with soaring energy prices that threaten to cripple its economy, the U.S. would not abandon its free-market rhetoric and use the military that it is paying for? After several generations of individualism and affluence, America will not easily dismantle its military machine and accept the need to rely on communities and revert to a sustainable lifestyle.

Friedrichs ends on a note that he describes as “not cozy”. Even if a mix of substitute fuels were to be found, and if alternate technologies were to be developed in time, this might mitigate the impact of peak oil and postpone the decline of overall world energy consumption – for a while. But there would inevitably be another time, as infinite growth on a finite planet is impossible. At some point, industrial society will start crumbling and free trade will begin to disintegrate.

Friedrichs article, “Global energy crunch: how different parts of the world would react to a peak oil scenario“, is published in the journal Energy Policy 38 (8): 4562-4569  (2010).