Published May 22 2009 by Energy Bulletin, Archived May 22 2009

The sinking Titanic: interview with Michael C. Ruppert

by Lars Schall

A Presidential Energy Policy
Michael C. Ruppert [1]
New World Digital

Lars Schall: Mr Ruppert, you’re about to publish a new book. What is the title of this book and what is it all about?

Michael C. Ruppert: A Presidential Energy Policy: Twenty-five Points Addressing the Siamese Twins of Energy and Money is a book addressing what an American President should be doing and saying about energy issues free from ideological, political, or other mental restraints. It is a simple and stark analysis of the world's current energy picture written for those with only a High School education that quickly and clearly cuts through the nonsense we have been sold about energy, money and growth. It also has wide appeal for planners and leaders (especially local) in all countries. Energy behaves the same way everywhere. German foresight on energy issues -- in particular its aggressive implementation of Feed-in-Tariffs -- has offered some very positive innovations that I have recommended be adopted by President Obama here in the U.S.

When and through what did you begin to take interest in Peak Oil? Had there been all at once a nightmarish vision like "the Road to the Olduvai Gorge" in front of your eyes?[2]

I was first exposed to the concept of Peak Oil by geologist Dale Allen Pfeiffer shortly after 9-11. I was struck by how simple and clear the actual science was; how easy the issue was to both comprehend and validate using nothing more than basic math and simple logic. It was absolutely a nightmarish vision then (and still is) but it explained so much about geopolitics, macro economics, war and the markets that I jumped into it right away. -- We are still on the Road to the Olduvai Gorge and that is precisely what my book seeks to prevent.

Years have gone by since then. Even though major newspapers like the New York Times admit these days that the end of cheap oil is near, they rather avoid to discuss the underlying consequences of Peak Oil. How would you explain those consequences? Isn’t Peak Oil somehow the end of globalization?

Peak Oil is not just the end of globalization. I was saying clearly that globalization was dead five years ago. It was obvious. But Peak Oil is potentially the end of the human race and that outcome is perhaps just a few years away unless the human race essentially throws every ideological sacred cow out the window and starts with a fresh piece of paper. There are around five billion people alive today that were not sustainable before oil came along. There is no combination of alternative energies (nor will there ever be) that can possibly sustain the edifice built by oil. In the industrialized world there are ten calories of hydrocarbon energy involved in the production of every calorie of food. Our soils have been little more than infertile sponges onto which we throw massive amounts of chemicals derived from oil and natural gas.

The most dire consequences may lie in food production, anyway. Agriculture depends a huge deal on oil. At From the Wilderness (FTW) you had the thesis that we are eating fossil fuels. [3] Can you explain those relations a bit?

In our world a farmer drives an oil-powered machine to plow fields. He or she then drives another oil-powered machine to plant seeds. Water for irrigation is -- in most cases -- pumped by electricity generated by coal, natural gas, and oil. Germany has made great strides in electrical generation through Feed-in-Tariffs which have exploded solar and wind generation but they do not resolve the whole equation. After seeds are planted and irrigated the crops are then sprayed with pesticides (derived from oil) and fertilizers (produced from natural gas). To harvest the crops the farmer then drives another oil-powered machine. Then oil is used to transport the food to processing plants and for subsequent distribution. Food is often wrapped in plastic (also oil) and frequently treated with chemical additives also derived from oil and gas.

Globalization has only compounded the issue by shipping food all over the world (wasting oil) for the sake of profit rather than sustainability. I live in California and can go to a market and find strawberries from Chile while Southern California grows great strawberries. This pattern is the same for most food consumed in industrialized countries. This only happened because cheap labour costs and less-stringent regulation became more important than common sense. Money overcomes logic every time. But just watching globalization end will not solve the problem. As I have said for years, globalization dies with cheap energy. There's little point in fighting it anymore unless the struggle is in pursuit of a unified energy vision.

The financial mess we’re in: Has it something to do with Peak Oil, too? Is there this systemic crisis because we are heading towards the end of the Age of Oil – and no one is telling the public so?

The current economic collapse is a combination of two things. First, the current global economic paradigm -- governed by fractional reserve banking, fiat currency, and compound interest (debtbased growth) -- is inherently and by definition a pyramid scheme. Money is useless without energy. One cannot eat a dollar bill or crumble it up and throw it in his gas tank. Each of the trillions of dollars created out of thin air since the fall of 2008 is a commitment to expend energy that cannot and will not ever be there. The Laws of Thermodynamics prevent this. I applaud the decision of Chancellor Merkel to resist the temptation to achieve a temporary solution by printing money endlessly. I am German by ancestry. My great grandfather migrated to the U.S. from a small town in Essen called Ruppertsburg at the turn of the last century. German pragmatism and realism on energy has been apparent to me since my first visit to Germany in 2003. It is not perfect and must be improved, but I have seen more clear thinking on the subject in Germany than in any of the 13 countries I have visited. That is actually not as good a thing as it might sound. There can be no "recovery", no return to growth (which is what the economic paradigm demands), without energy.

Why is this not discussed openly: The dinosaurs of the old paradigm -- who are about to pass into extinction -- cannot admit this because it would have an immediate effect on the financial markets which are already dying. People would stop buying stock if they understood that a return to growth is impossible. I think, however, that on a more fundamental level the dinosaurs just cannot see their own impending extinction. They are incapable of mental and spiritual evolution which all of our survival depends upon. They cannot adapt. As the global environment changes forever, from the related issues of climate change, energy shortages, and economic collapse all dinosaurs can do is die. That's what Darwin so clearly proved with regard to all life on this planet. Those species which cannot adapt must go extinct. We see billionaires and dinosaurs disappearing or losing money everywhere. Even Warren Buffet and George Soros are losing money because they cannot grasp that infinite growth is not possible. The term "sustainable growth" is perhaps the greatest oxymoron ever coined and an instant indicator of imminent Darwinian deselection for anyone who uses it. I keep a safe distance from such people.

Mainstream media all over the world is corporate-owned; a dinosaur by definition. In America CNN is owned by Time-Warner; CBS is owned by Viacom; NBC is owned by General Electric, ABC by Disney; the Wall Street Journal is owned by Rupert Murdoch and Newscorp, ad infinitum. All large press outlets sell stock and -- far worse -- are tied into a global derivatives bubble now estimated at $700 trillion in notional value that not only is collapsing: The Mother of All Bubbles.[4] Telling the truth to the people means that people will stop buying GE, Time Warner, Viacom and Newscorp stock so that is the last thing mainstream media can acknowledge.

Those who produce, edit and report the "news" are corporate citizens rather than human beings. They have chosen to murder their own children to protect their current jobs (the food they receive from an abusive parent). Being of German ancestry I am sensitive to issues about being willfully ignorant (cowardly) in the face of great evil. I am also aware of and grateful for the White Rose and von Stauffenberg and his heroic colleagues. I have felt like these great Germans must have felt for many years now. I still owe a great debt of gratitude to my old friend Andreas von Bülow from Köln[5] who graciously exposed me to authentic German culture. I have lost contact with Andreas and his wife Anne and I pray they are well. Now we find that this blindness is an inherent part of humans in all countries and the one thing that must and will go extinct with the Old Paradigm.[6]

But the dinosaurs are losing their grip. Since the start of the collapse of industrial civilization, corporate-owned media has become something of a joke. "Check the tire pressure on your resume" is about the best advice they can offer. Then they say, "We think we have hit the bottom, so buy stock and don't pull your retirement out of the markets" while at the same time issuing reports that show that we are nowhere near a bottom and that everything is getting worse. Who can trust such nonsense. There must be a great German word that means idiotic, contradictory and bullshit at the same time. [Kokolores]

The money that is spend in billions and trillions these days will be needed in the struggle with the consequences of Peak Oil – and will be gone. Forever. Doesn’t make that a collapse of industrial society inevitable?

The collapse of industrial civilization within the next five to ten years (perhaps sooner) is inevitable. It is the degree of collapse, what is destroyed in the collapse, how many people will have to die in the collapse, and what will survive the collapse that I and many others are fighting for now. That is what every human being should be concerned about and nothing less. Pursuing options while not rapidly disengaging from the current economic paradigm of infinite growth is the only real issue confronting the entire species. To not do that will be literally to consign unborn generations and those under 40 to death or a living hell.

Mr Ruppert, if we know something for sure about 9/11 it is the fact that the world public was rather misled. Information on TV and in the newspapers was very one-sided and incomplete. What does this tell us about the handling of the situation we are facing now in 2009? And hasn’t 9/11 itself become a major distraction from the collapse of industrial civilization?

Few have done more detailed investigation of the 9-11 attacks than I have. Even though Rubicon is in the Harvard Business Library and has sold around 100,000 copies in two countries, it has never even been acknowledged by my government. 9-11 was a predictable event and it was motivated precisely and solely by Peak Oil and nothing else. I believe I proved that conclusively in Rubicon which has never been challenged; only ignored. It is absolutely too late to go back and seek justice for the crimes of Richard Cheney and George W. Bush. I believe they were counting on that. It would be literally a waste of energy. Oil and natural gas can only be burned or consumed once. The present crisis is so severe that we cannot waste oil, natural gas and the limited energies of human consciousness to go back there.

At the end of Crossing the Rubicon you stated this scenario: “We have to pay for $100-(orhigher) a-barrel oil somehow. Why don’t we just print the money? Anyone who has heard of the damage done by inflation and hyperinflation to those least able to cope with it should think back to Germany’s Weimar Republic in the 1920s.”[7] There is no need for you to rewrite this passage insofar it seems like this recession wants to prove you’re right, don’t you think?

Weimar-style inflation is inevitable in the United States, especially as major economies start to disengage from the dollar. I predicted this at least six years ago. It is only a matter of time. Here is the basic sequence of events I see coming: FDIC insolvency, Treasury default on T-bills and all Treasury notes, the end of the dollar as the global reserve currency, hyperinflation, insolvency and bankruptcy of the Federal Reserve which is a privately-owned bank. That will be followed by the eventual collapse of the United States government. All of these things are inevitable in my opinion and could happen in full in as little as three years. The dinosaurs refuse to accept this because they won't question a monetary ecosystem which they created and which has allowed them to thrive from the Garden of Eden until now. Those who wish to survive and understand the issue will do whatever they can to disengage from a Titanic that is clearly sinking by building local lifeboats, tailored to their local needs.

Fortunately, there are many things that can be done, independent of government action, and that's why A Presidential Energy Policy was written.

In February of this year, the International Energy Agency (IEA) in Paris put out a forecast in which they are predicting an even bigger economic crisis in years to come. According to the IEA, the reason for this is the cancelling of new investments into new drilling projects by the major oil companies. In the case of rising demand in 2010, the oil price could explode, inflation could rise and the result could be that world economic growth would likely come to an end. Let us talk about the infrastructure problem first: Why do you think big oil doesn’t invest anymore in new projects?

All of those projects, whether for deep sea oil or in pursuit of alternative energies were only profitable when oil was at or near $100. All over the world, energy infrastructure is crumbling as a result of collapsed oil prices making it unprofitable to invest in infrastructure or alternatives. A few years ago Robert Hirsch of SAIC wrote a study for the U.S. government warning of the crisis which stated clearly that the time to have started preparing for this was 30 years ago.[8] He examined scenarios in which preparations were begun twenty, ten and zero years before Peak. All scenarios were catastrophic. His observations were only confirmations of warnings issued by Vice Chancellor David Goodstein of Cal Tech which said clearly in his book that it takes thirty years and a lot of money to change an energy infrastructure.[9] Mankind has waited until the last minute and there is no money left. It's that simple. People have been warning about precisely this moment since 1949 when the great M. King Hubbert laid this landscape out for all to see.[10] There is little or no money left for essential infrastructure investment and the infrastructure cannot be rebuilt under the current economic paradigm. As Dutch economist Martin van Mourek said in 2003, "It may not be profitable to slow decline." He was absolutely correct and I knew it the instant I heard him say it in Paris.[11]

And now let us talk about the oil price spike. In 2006, you and Michael Kane wrote an article for FTW called "The Markets React to Peak Oil. Industrial Society Rides an Unsustainable Plateau before the Cliff", in which you were writing about the Bumpy Plateau. You’ve explained it like this:

“Recent price swings – both up and down – have been predicted as a part of the Peak Oil scenario for years. I saw the first hard predictions of the bumpy plateau in 2002, and they made good sense.


Here’s how Colin Campbell described it when FTW contacted him for this special report:

  1. Price shock (as the capacity limit is breached)
  2. Economic recession cutting demand
  3. Price collapse (the market overreacts to small imbalances between surplus and shortage)
  4. Economic recovery (followed by increased demand)
  5. Price shock (as the falling capacity limits are again breached) Simply put, everything is triggered by the inability of the planet to increase supply beyond a certain point, regardless of demand. That is the definition of peak. Peak is still peak whether it leads to sharp and immediate fall off or to the bumpy plateau we are now seeing.”[12]

Is this model still the procedure after which “everything is triggered”? Is it the Bumpy Plateau that the IEA is talking about for 2010? And was it the Bumpy Plateau we have witnessed already in 2008?

We are on the bumpy plateau right now. The description and predictions offered by Campbell and many others were very good but only two-dimensional in that they addressed price and demand only. I think my greatest contribution on top of their pioneering work has been to thoroughly explore and illuminate the corruption of the economic paradigm, the significance of derivatives[13] and to introduce that as a third factor. This has allowed me to make astonishingly accurate predictions for a decade now. The implosion of the derivatives bubble which has only just begun may prevent any real or even temporary "recovery" from ever taking place. All the energy spent on a "recovery" in the infinite growth paradigm will have been wasted. One thing I am also certain of is that there won't be many bumps in the bumpy plateau. As soon as any kind of recovery begins, it will collide instantly against the brick wall of diminishing energy. We have passed Peak I am certain. The IEA has virtually admitted all this. After the last bump it is straight down the cliff back to the Stone Age unless people take action immediately.

In 2001, when the Bush Administration came to power, the broader public did know nothing about Peak Oil. The Bush Administration did. In your book “Crossing the Rubicon” you point to a speech by Dick Cheney that he delivered in London at the Petroleum Institute in 1999. [14] Mr Cheney was the CEO of Halliburton back then. He was in the loop, right?

Cheney was the loop. There is an abundant record that the most powerful policy-making institutions have known about Peak Oil since at least the 1970s. That includes our CIA, [15] leadership in Russia, Britain, China and Japan. My studies suggest that Germany understood it best and has done the most to address it implications over the years.

An important topic of your research with regard to 9/11 are the unknown records of the “Energy Task Force” run by Dick Cheney, the National Energy Policy Development Group. In Crossing the Rubicon you wrote:

“I have said for two years that the deepest, darkest secrets of September 11th lie buried in the records of the US National Policy Development Group (NEPDG) which began its work almost the same day the Bush administration took office and produced its final report in May of 2001, just four short months before the World Trade Center ceased to exist.”[16]

Can you explain this in more detail for those who have never heard about this before?

It's explained in detail both in A Presidential Energy Policy and in Crossing the Rubicon. Essentially the NEPDG appears to have been set up, almost from the first day of the Bush administration, to find out how much oil was left, who had it, and how it could be obtained (bought or stolen) to support U.S. hegemony, U.S. consumption, and the monetary paradigm. Those things are all dinosaurs anyway and they are dying in the New Paradigm as they must. The fact that the NEPDG records have been kept secret from the American people who paid for it is one of the greatest crimes of all time. Seeing those records now would save a lot of duplicated effort in trying to inventory how much oil there is left.

The figures on oil reserves quoted by producing nations and companies are as fraudulent and cooked as the books on mortgages, banking, and even Bernie Madoff. The Saudis cannot hide the fact that they have passed Peak anymore. I prove that in my new book. The world's largest energy investment banker Matthew Simmons proved it before I did in his book Twilight in the Desert. [17] I have proved the same thing a different way. If Saudi Arabia has passed Peak then the whole world has passed Peak. It was Peak Oil that was driving Dick Cheney's Task Force and nothing else.

Is there a chance that we will ever know about the real content of the NEPDG files?

I hope so. That's what I have called for in A Presidential Energy Policy.

You are known for using this quote by Benito Mussolini:

"Fascism ought more properly be called corporatism because it is the perfect merger of power between the corporation and the state."

Isn’t Dick Cheney a perfect example for this? He did made a whole lot of money as a main-shareholder of Halliburton through the foreign policy of the Bush Administration, didn’t he?

He shouldn't be singled out. The Bush-Cheney administration had its "base". Some of that base is shared with the Obama administration. The Bush-Cheney administration, knowing that collapse was coming, looted the U.S. economy on behalf of its base. It was perhaps the largest wealth transfer (theft) in history. I predicted and warned about each step in precise detail for eight years. [18]

I was dead-on accurate and there's a clear record to prove that. And I suffered for it. I was harassed, sabotaged, my offices were burglarized and my computers smashed in 2006 prompting me to flee the U.S. for four months. What did we Americans do as Bush and Cheney rode out of town with all that wealth? We gave them a parade and called it inauguration day.

Beyond Peak Oil as a motive for the Bush Administration to “arrange” the thing that we know as “9/11”, you wrote extensively about the importance of Afghani drug traffic. Since the military engagement of NATO forces in Afghanistan, the profits from heroin trade are at an all time high, aren’t they?

The global drug trade is evolving. I won't go back now and explain what happened between 2001 and today. The global drug trade was estimated by me to be generating around $600 billion a year in total revenues in 2004. That was fine as long as the infinite growth bubble appeared to be functioning. Drug cash was chased by banks and major corporations like General Electric, AIG, Philip Morris, Citigroup, etc. back then. Europe was no exception. But now the collapse of a $700 trillion derivatives bubble has changed everything. What was a lubricant to allow further expansion of the bubble in 2001 is today less than the minimum monthly payment on a credit card.

The reason why the U.S. is having all this drug violence now is, I am certain, because U.S. banks are crying for all the illegal cash they can launder to service the "minimum monthly payments" on their derivative exposure. The drug violence is here because all over Mexico the word is out on the streets, "Get a kilo of grass across the border and you get $500." It's a stampede because Mexicans are starving. That is because their largest oil field Cantarell is collapsing and oil revenues have plummeted. It always comes back to energy and money.

Who knows how many drugs are being consumed now? Personally, I don't think it is significantly higher than it was five years ago or twenty-five. I have written extensively -- citing scientific studies -- that only about 10% to 12% of any given population is susceptible to addiction. The rest of the people may use drugs but will never get addicted because they realize it's not beneficial. They don't like it. One does not create addicts by pumping more drugs into a society. One only feeds that fixed percentage who are susceptible to addiction. That is what is called a captive market under the current monetary regime.

Let’s take a look at this news article from Reuters, please:

UN crime chief says drug money flowed into banks
Sun Jan 25, 2009 9:17am EST
VIENNA, Jan 25 (Reuters) - The United Nations' crime and drug watchdog has indications that money made in illicit drug trade has been used to keep banks afloat in the global financial crisis, its head was quoted as saying on Sunday.

Vienna-based UNODC Executive Director Antonio Maria Costa said in an interview released by Austrian weekly Profil that drug money often became the only available capital when the crisis spiralled out of control last year. ...

Can you comment on this?

As Claude Rains said in Casablanca, "I'm shocked! There's gambling going on in this establishment."

Mr Ruppert, we are talking here about Organized Crime at the top ranks in finance, economics and government. One might think: “Well, has it ever been different before?” In my opinion the main difference is that Organized Crime is nowadays almost officially part of the game – it isn’t really hidden anymore. One example for this is the manipulation of the stock market by the infamous Plunge Protection Team (PPT). Can you explain how the PPT works, who is involved and why its existence isn’t just a “conspiracy theory”?

The PPT is overwhelmed now. This collapse has been a tsunami that has rendered the PPT largely ineffective. It had the ability to intervene artificially to prevent market collapses when it was only billions of dollars involved.

Now that we're dealing with trillions the PPT is of little interest. Broadly speaking, the U.S. Treasury (almost a proprietary of Goldman Sachs) has become in itself a PPT with increasing ineffectiveness. The U.S. is currently having the biggest "Sucker Rally" there will ever be.

I would also like to talk a little bit with you about gold under the circumstances of Peak Oil. I remember you have written a while ago that the “new” wealth is gold – which is the “old” wealth. What do you mean by that precisely?

Look, the fact is that when the FDIC and the Federal Reserve go insolvent, gold will be the only place left to turn. Proposed new currencies cannot solve the problem. They will only destroy evidence and people by chasing the mirage deeper into the hole. New currencies will only recreate the same problem in a different and more vicious form. For seven thousand years the human race has chosen only one option as a universal store of value in hard times -- gold. To protect against inflation -- gold. I have seen many reports saying that there is five times more paper gold than there is physical gold out of the ground. Gold is finite. It cannot be printed. It has a connection to the earth. I strongly advise all my readers to buy and hold physical gold and have done so for years. The human race does not have to stay with gold forever. But it will help those with it to survive and function economically as collapse unfolds.

Another question, straight and dry: Is the gold market manipulated, and if so, how?

Absolutely gold prices have been manipulated. For the best discussion of that I recommend the Gold Anti-Trust Action Committee (GATA) and ttp:// [19]

You have said over and over again during the last years: “As long as you don’t change the way money works, you change nothing.” For example you wrote recently in an open letter to President Obama: “All you are doing is buying time to prevent the collapse of a totally dysfunctional marriage where the mother (the government) kills the children (us) to save her relationship with the father (the way money works).” Two simple questions: How does money work, and: How should it work in future?

These are addressed clearly and succinctly in my book.

In order to sum our interview up so far: What we need is a paradigm shift. How should it look like, besides a change of the way money works?

The way the paradigm shift should occur and what it should look like is a discussion for the entire human race. I choose not even try to answer that. I do offer some ideas on how to start the dialogue in the book.

Let us take at the end of this interview a look into the future. Ten years from now: Give us your best case scenario, please.

There is a mass awakening of human consciousness; the equivalent of mankind taking the red pill from the movie The Matrix. We stop chasing an impossible notion of infinite growth and begin to change our minds about life and what it means right now. We accurately, clearly and fearlessly accept and embrace the crisis and begin implementing available solutions today. We stop feeding the economic beast which has no option but to kill us in order to save itself. Maybe instead of four or five billion people starving and or dying in resource wars, or in nuclear exchanges over resources, we can reduce that number to two or three billion and also identify, redefine and preserve the best parts of human civilization for the generations that follow. We find a way to live in balance and true sustainability with the planet that gives us life and all the life that we share it with.

And now give us your worst case scenario, please.

Human extinction and the possible extinction of all life on the planet, either as a result of climate collapse or a global nuclear exchange over energy.

The coming situation of Peak Oil will be a turbulent event. When I got you right, you argue in “Crossing the Rubicon” that the Patriot Act and the cut-back of the Posse Comitatus Act were implemented by the American government to prepare itself against civil unrest during the “hard times” of Peak Oil. Is your country heading into a future where freedom is again a privilege, not a given right? And why should people in Europe and around the world be very interested in the freedom of the citizens in the United States?

I disagree with the Russian analyst who predicted a civil war here.[20] Civil wars are defined by geographic boundaries. I do however think it inevitable that the United Sates will dis-integrate and there are clear signs of that beginning right now. But what's going to happen here is no different than what will happen all over the world. As human industrial civilization collapses everything will be governed by a force as powerful and unyielding as gravity. That is geography. Things do not break up. They break down. They get smaller. Problems in Essen or the Rhineland will be different from problems in East Prussia or Bavaria. There will be massive social unrest here but I do not believe it can be accurately predicted how that will play out. There can be only one end result.

Everything will revolve around what is within 50 or 100 kilometers of where one lives. The reason why the United States is so important is because my country still exerts so much political, social, economic and cultural influence around the world. In writing "A Presidential Energy Policy" I not only recognized the difficulties we face here but the fact that if the United States can change, if it can drop the suicidal notion of infinite growth and its defense of a corrupt and murderous economic paradigm, then the whole world will be that much more empowered to save itself... country by country, region by region, and neighborhood by neighborhood.

Thank you very much, Mr Ruppert, and nothing but the very best to you!


[1] Michael C. Ruppert: Crossing the Rubicon. The Decline of the American Empire at the End of the Age of Oil, New Society Publishers, 2004

[2] see Richard C. Duncan: The Peak of World Oil Production and the Road to the Olduvai Gorge at:

[3] compare Dale Allan Pfeiffer: Eating Fossil Fuels at: See further Dale Allan Pfeiffer: Eating Fossil Fuels: Oil, Food and the Coming Crisis in Agriculture, New Society Publishers, October 2006

[4] Some estimates go even further: According to Mark Anthony of “Seeking Alpha“ it is a bubble of „$1.14 quadrillion (...). That's a ONE followed by FIFTEEN (15) ZEROs.” See Mark Anthony:
“Some True Safe Havens Are Still (Surprisingly) Undervalued”, October 2nd, 2008 at:

[5] Mike Ruppert means the former German Parliamentary Secretary and Minister for Science and Technology, Andreas von Bülow.

[6] see also Michael C. Ruppert: “The Paradigm is the Enemy”, a speech given in April 2006 published at:

[7] see Michael C. Ruppert: Crossing the Rubicon. The Decline of the American Empire at the End of the Age of Oil, New Society Publishers, 2004, page 568

[8] see Robert L. Hirsch: Peaking of World Oil Production: Impacts, Mitigation, & Risk Management at:

[9] see David Goodstein: Out of Gas: The End of the Age of Oil, Norton, W. W. & Company, Inc., 2005

[10] see for M. King Hubbert:

[11] compare Michael C. Ruppert: Crossing the Rubicon, page 39, and also by the same author: "Paris Peak Oil Conference Reveals Deepening Crisis” at:

[12] Michael C. Ruppert, Michael Kane: “The Markets React to Peak Oil. Industrial Society Rides an Unsustainable Plateau before the Cliff” at:

[13] see for example:

[14] compare. Michael C. Ruppert: Crossing the Rubicon, page 47ff. See furthermore Kjell Aleklett: “Dick Cheney, Peak Oil and the Final Count Down” at:

[15] compare Richard Heinberg: “The Smoking Gun” unter:

[16] see Michael C. Ruppert: Crossing the Rubicon, page 42

[17] See also for this:

[18] see for example:

[19] see further: Mike Ruppert on Tuesday, April 21st, 2009 at his blogspot “The Bear Market-sucker's-manipulated-pumpanddump rally ends shortly -- right on time. The only thing I missed in recent predictions was $2,000 gold, but I think I know why. I've noticed two huge gold sales recently. One for 140 metric tons and another for (I think) 30 metric tons. There can only be so many tranches of that size. That's around six million ounces. No wonder the price has taken a hit as fools sold their gold and threw money back in the markets. I smell the end of the gold cabal. They've had to dip into their reserves... the real thing. “

[20] Mike Ruppert means Igor Panarin. See for this:

For further information visit:

Published Jan 18 2010 by ClubOrlov, Archived Jan 19 2010

Real Communities are Self-organizing

by Dmitry Orlov

John Michael Greer, Sharon Astyk and Rob Hopkins have made some interesting points on the topic of community, and I wish to join the fray. In all of my experience, communities — of people and animals — form instantaneously and rather effortlessly, based on a commonality of interests and needs. What takes a lot of work is not organizing communities, but preventing them from organizing — through the use of truncheons and tear gas, or evictions and mass imprisonment, or, more recently, more subtle and ultimately more successful techniques of the consumerist political economy.

Greer wonders why people don't put more work into organizing communities; after all, this is what has worked in America in the past and how a representative democracy is supposed to function. All it should take is hard work, so why don't we hop to it? To me, this smacks of the fallacy of misplaced concreteness — roughly speaking, that just because different objects at different times carry the same label ("America"), they are somehow the same object. How representative a democracy the US ever was is rather beside the point; the point is, it was once a country where people could successfully and openly self-organize, and now it isn't. Once there were strong, cohesive communities in the US, which could organize and bring pressure to bear on their elected officials. And now, as described in Robert Putnam's widely discussed book Bowling Alone (2000), there are no such strong, cohesive communities in the US, and so... they can't organize, because, I would think, there is nothing for them to organize. Existence of communities allows communities to organize; lack of community prevents communities from organizing. That's a bit of a tautology, is it not?

As an aside, I'd like to point out that the US is not much of a representative democracy any more. It's more of a hokey-pokey-ocracy: in one election cycle, you throw your right bums out and vote your left bums in, and in the next election cycle, or the one after, you do the exact opposite. (And you shake it all around in the meantime.) The bums — the Republicans and the Democrats, that is — are perpetually locked in a loving embrace, for they truly complete each other. The Democrats tend to believe that government there to help people, which is of course impossible for a government that's chock-full of Republicans who believe in limiting the scope of government and sabotage all such efforts. The Republicans believe in limiting the scope of government, which is of course impossible for a government that's chock-full of Democrats who believe that government is there to help people, and sabotage all such efforts. You can vote for either party if you want it to fail while producing an ever larger and more useless government.

Both parties agree that the government should serve corporate interests. They are both skittish when talking about the rights of citizens, and prefer to talk about "consumers" rather than "citizens". As a nation of consumers, people in the US have no choice but to be consumers. The ones that don't have the money still get to consume things like orange jumpsuits and prison food. Foreign non-consumers also get to consume — things like depleted uranium and white phosphorus ordinance. Being a non-consumer is not an option, and the whole world must be made safe for consumerism. Organizing against consumerism amounts to biting the corporate hand that feeds you — an ungrateful and self-defeating thing to do. So you want to organize a third party? Be my guest; see you later.

Astyk makes the excellent point regarding the destruction of community through overwork and the herding of women out of the home and into the workplace. Women can't just be (unless they are rich) — they have to have an occupation, and the default occupation — "homemaker" — carries a bit of a stigma. Women have always been the backbone of any community, and the regimentation of women's lives was a brilliant move in the direction of totalitarian consumerism, because it allowed relationships even within the family, such as child-rearing, to be commercialized. Once all social interaction is centered around consumption patterns, community as a notion becomes little more than an advertising gimmick, and self-organizing properties of society become restricted to pursuing the latest commercial fashion.

Hopkins raises an interesting issue when he mentions the common criticism of intentional communities and the Transition Towns movement that it is predominantly white, educated, and middle-class. This is hardly surprising, since these are the only people who have the resources and the connections to do pretty much as they please. They can create their alternative arrangements out in the open, as long as they don't actively threaten the status quo. They can build an entire Garden of Eden if they so desire, provided they can line up the financing and pull the construction permits. That is the essence of consumer choice, isn't it? The rich get to play, while other, less privileged parts of the population, such as the immigrants, the squatters and the homeless, the chronically unemployed or underemployed, the bums (the real ones, not the ones in government), simply don't have the same options. At the same time, their need for community is much greater, and so they spontaneously self-organize, network informally, and defend their interests as best they can. They all know that "a nail that sticks up gets hammered down" and so they don't advertise their efforts or make them official or explicit.

Hopkins also makes the excellent point that the entire approach of "creating community" is patronizing and ineffective. Community regenerates spontaneously, given time, space, a commonality of interest, provided it is not too oppressed. As industrial economies continue to shrink and shed jobs, more and more people will be squeezed out to the margins of the consumerist universe, and, finding more time on their hands than they know what to do with, will start to reengage with other people in similar situations. Since their needs will often be coincident or complementary, they will form various types of temporary and informal groups. There is certainly a great deal that all of us can do to help, but "organizing" is not one of them. First and foremost, we should stop working so hard on destroying community, as we have been doing by leading overwhelmingly regimented and commercialized existences. And let's quit it with the political hokey-pokey — it's much too undignified.

Published Jan 28 2010 by Energy Bulletin, Archived Jan 28 2010

Sarkozy at Davos - Jan 28

by Staff

Click on the headline (link) for the full text.

Many more articles are available through the Energy Bulletin homepage

Sarkozy seeks a new order and throws down gauntlet to China

Helen Power, The Times
President Sarkozy has promised to put the huge trade imbalances between the East and West at the centre of global financial reform when France takes over leadership of the G8 next year.

In a speech at the World Economic Forum in Davos yesterday, Mr Sarkozy called for a more responsible form of capitalism for the 21st century and backed President Obama in his attempts to break up some of the world’s biggest banks.

Yet it was Mr Sarkozy’s new promise to press countries with huge trade surpluses — such as China — to revalue their undervalued currencies that captured attention. It echoed similar comments by George Soros, the veteran investor, earlier in the day that China must let its currency appreciate.

“We cannot preach free trade and at the same time tolerate monetary dumping,” Mr Sarkozy said.

He urged developing nations with huge trade and fiscal surpluses to allow their currencies to appreciate and consume a little more while the heavily indebted West slowly reduces consumption and pays down its debt. He went on to urge world leaders to adopt an entirely new financial regulatory system, with a mechanism controlling exchange rates at its heart...
(28 Jan 2010)

Davos 2010: Sarkozy calls for revamp of capitalism

BBC news
"We need deep profound change," he said in his keynote speech at the World Economic Forum in Davos.

His comments came as bankers and regulators clashed over proposals to break up banks that threaten the whole financial system.

Mr Sarkozy said he wished to restore a "moral dimension" to free trade.

"Were we not to change, we would be showing tremendous irresponsibility," he told the bankers and politicians that gather annually in the Swiss alpine resort.

Bank reforms
France has supported forcing banks to hold more capital and curbing bonus payments in global negotiations over the past year on how to reform the system to prevent future crises...
(27 Jan 2010)

Sarkozy's Unpragmatic Vision

Paul Maidment, Forbes
It was hard to tell if the half of French President Nicholas Sarkozy's audience who didn't give his Davos 2010 keynote speech a standing ovation stayed seated out of disagreement or bafflement. It was a speech of vision and was more soaring in the French in which it was delivered than in the English into which it was translated (full French text; full English text). But what that vision was was not entirely clear.

"The globalization we had dreamed of at the outset was of the kind where, instead of taking from others by means of monetary, social, fiscal or ecological dumping, each of us would found development on social progress, increased purchasing power, reduced inequality, improved standards of living, health and education. . . . By prioritizing short-term logic, we have paved the way for our entry into a time of scarcity. We have exhausted non-renewable resources, devastated the environment, caused global warming. Sustainable development cannot be achieved if profits up front and dividends for shareholders are our sole criteria."

One attendee said it was the most socialist speech he had heard from a man who came to office as a right-of-center president promising to inject an entrepreneurial free-market spirit into the French economy. Certainly there were plenty of lines in Sarkozy's Davos speech to leave free marketers aghast. For one, his view of government's role in the economy:...
(27 Jan 2010)
The full text of the speech is here.

Published Jan 18 2010 by, Archived Jan 20 2010

Disasters Far and Near

by James Howard Kunstler

As the disaster in Haiti moves into its "Katrina" phase of organizational chaos, relief effort failure, and public health calamity, the world will get another lesson in the dangers of techno-triumphalist posturing. American authority pretends to be in flawless control of a situation that by the minute crumbles into anarchy and death as the generals strut their stuff and the CNN crews broadcast yet another feel-good segment about adopted orphans. At this point, one rainstorm is all it will take to kill what is left of the Haitian social order.

It's a tragedy for the ages, and tragedy is a fulcrum of the human condition that techno-triumphalism pretends to have vanquished. All the meals-ready-to-eat on God's green earth won't add up to a happy ending for everybody. Haiti was a disaster waiting to happen every bit as much as the Federal Reserve is for us. For decades, the USA's policy (and the UN's too) was just to stuff more food aid onto an island already so far beyond its carrying capacity for human existence that every new birth certificate was a death warrant in disguise. But free people are free to do what they will do, and in Haiti there was not much more to do than make more people.

Now the USA will also pretend that there is a Haitian government in charge -- as in the pathetic grandstanding of Secretary of State Hillary Clinton the other day -- though the Haitian government was a fiction for decades before the earthquake struck. The recent blatherings of Bill Clinton would have us believe that Haiti is poised to become an exemplar of economic development for the Caribbean once things are tidied up there. What planet are these people living on? (Answer: Planet Limousine.) Rather Haiti is the example of what life may become in nations bethinking themselves developed further along in The Long Emergency. If the figures on world crop failures for 2009 are relevant, even places like the USA may get a taste of this before the end of 2010.

On the home front we have President Obama's announcement last week of a tax on banks that received bailouts of one kind or another.  This tax, he said, would amount to $90 billion over ten years. That's pretty funny, since there is no shortage of opinion to the effect that ten years from now $90 billion might buy you a box of Little Debbie Snack Cakes -- if the means of production are even there to make the darn things. Here's an idea: if the USA is going to backstop companies that are not allowed to fail, then maybe these companies should fork over hefty premiums for what is, in effect, an insurance policy. For instance, those billions now slated to be paid in in bonuses to the likes of Goldman Sachs, JP Morgan / Chase, Citibank, et cetera ad nauseum. Let them just pony up these bonuses to the taxpayers every year as long as they enjoy backstop insurance. (They'll still have very hefty salaries.) And, by the way, those bundles of money don't even cover these bank's off-balance-sheet liabilities.

I raise these indelicate points to argue that the stories we are telling ourselves these days do not reflect the real circumstances we find ourselves in, and will not help us to get through the difficult times ahead.  In fact, they amount to an invitation for more tragedy. The more the USA imagines itself to be too big to fail -- and immune to the mandates of reality -- the more likely we are to fail massively. The more we indulge in techno-triumphalism and organizational grandiosity, the more chaos we invite. The signal failure for the moment is the Obama regime's unwillingness to imagine that the old economy is dead and that no amount of financial mortician's wax and rouge will bring it back to life. Stunts such as so-called Financial Crisis Responsibility Fee (the $90 billion tax over ten years) will only corrode what is left of Mr. Obama's authority as its meaninglessness reveals itself.

In the meantime, no one with any real authority has asked figures like Hank Paulson, Lloyd Blankfein, and Tim Geithner under oath exactly how Goldman Sachs managed to get paid 100-cents on the dollar for derivatives bets from the foundering AIG; and how come in the first place Goldman Sachs was short-selling the fraud-riddled derivative securities it was packaging for sale as AAA-rated paper to credulous investors; and many other pertinent questions of the day that ultimately must be answered and settled within the rule of law. Funny, too, that our constitutional law professor president hasn't demanded this from his own Department of Justice. I maintain that it's crucial to settle these matters if we don't expect to become an entirely lawless nation.  It's necessary to break up the TBTF banks.  It's necessary to investigate their officers, and prosecute them if the facts warrant it.  It's necessary to open up the dark vaults of off-balance-sheet liabilities and dispose of them at their true value.

It's necessary to start telling ourselves a different story about where we are going. We're destined to become a different kind of society and economy. If that future economy is not based on real productive activity conducted at a scale consistent with resource realities, then we will starve to death, or watch our infrastructures of daily life crumble away to nothing, or hack each other to pieces as the the people in Haiti may do before the end of this week. Goldman Sachs and its cohorts are not necessary for the future economy of the USA.  In fact, they're already dead. The real zombies of this world stalk the sidewalks of Wall Street, not the swamps of Port-au-Prince.

Published Jan 21 2010 by, Archived Jan 21 2010

Oil Caused Recession, Not Wall Street

by Tom Therramus

There is a lot of oil about. A lot left in the ground and a lot being produced. Amidst the contention, it is easy to overlook that Peak Oil is called Peak Oil because this is when we will never be more awash in the black stuff.

The abundant availability of oil buoys skepticism.

“What oil shortage?", doubters ask, with some justification.

Peak Oil is in part a symbolic marker. Like reaching the year 2000, the Queen passing her 50th jubilee or getting half way through a glass of beer. Notable, and in the case of the beer regrettable. However, Peak Oil will likely pass without undue trouble.

What matters are problems that will go along with the globe’s production of oil maxing-out. The most important of these is likely to be the rising level of volatility in the price of oil.

In December 2009, The Oil Drum published an essay in which I asked the question - Was volatility in the price of oil a cause of the financial crisis? .

The crux of the essay is a chart (see below) showing that during the 2000s oil price volatility rose and fell over time in a distinct series of spikes.

This new volatility signature appeared to be unprecedented, but there was an added surprise in store. Further snooping led to the discovery that each spike in the oil series was matched by transient instabilities in other economic indexes, including inflation rate and investment risk.

The relationships shown in the essay were correlative. Care thus has to be taken since correlation in time does not prove causation. Bearing this in mind, the hypothesis posed was that these recurring spikes of volatility in oil price destabilized the investment environment. This destabilization was suggested to have led to a run on the shadow banking system.

As has been noted by Paul Krugman and others, the collapse of the shadow banking system was the falling domino that brought the financial markets crashing down.

Further indication of a link between oil and the financial crisis has come from the economist James Hamilton . In a paper to the Brookings Institution, Hamilton computer modeled the effect of a rise in the value of oil similar to that of 2007-2008, when oil reached ~ $140. The model suggested that the GDP decrease occurring during the present recession could almost entirely be explained by the increase in oil price.

The take home from my work and that of Hamilton’s is that the received wisdom may be wrong. Wall Street, sub-prime and regulatory failure are not the ultimate cause of the economic melt down. The root of this crisis is probably oil.

Now, readers may be saying to themselves:

Hang on. This is backwards. The 2008 oil shock occurred after the financial crisis started.

However, what the chart shows is that the shock of 2008 is not an isolated event. This recent run-up in oil price simply explains the largest of a series of at least 7 spikes in volatility, with the first topping out in 2002.

The identification of this distinct signal of instability in oil price, that initiated years before the start of the financial crisis, is a finding that sets my analysis apart from that of Hamilton’s.

The idea that oil shocks resulting from Peak Oil may cause large economic disruptions is not new. A few brave thinkers, including Jeff Rubin and Matthew Simmons, have warned of this possibility.

What is new is that there is now real world data suggesting that this anticipated turbulent phase is underway.

A number of experts take an alternate view that speculation and the financialization of energy markets explain the recent upsurge in oil price volatility.

In a response to the Oil Drum essay, Chris Cook, the former Director of the International Petroleum Exchange, wrote:

“…the principal cause of the financial crisis and of the volatility are one and the same - to wit, the 'leverage' or 'gearing' derived in the former case by deficit-based credit creation by banks, and in the latter case by both bank credit creation and forward/futures contracts”.

Chris’s comment is based on his 25 yrs in the oil markets. Strong evidence opposing his notion is not available. Nonetheless, the chart provides food for thought for those who suspect that speculation is primarily responsible.

Many in the US will recall the sharp rise in gas prices coinciding with Hurricane Katrina. This price run-up in 2005 accounts for the spike in volatility marked KATRINA on the chart.

However, from the big-picture view given by the chart, it can be seen that there are noteworthy spikes in the years preceding and following that of Hurricane Katrina. As with the year of 2005, when Katrina struck New Orleans, 2004 had an active hurricane season. However, 2006 was comparatively quiet.

The point is that while Hurricanes, speculators or even Nigerian terrorists may act as triggers, such standalone factors simply cannot explain the multi-year pattern seen on the chart. This long-term twitchiness is likely to have a systemic basis, such as that which would result from a tightening balance between supply and demand as oil production peaks.

In comments on the essay, David Ramsey raised a second important criticism. Paraphrasing his line of skepticism, David asked,

What makes you so sure that this time it is different?

Adding the interesting suggestion,

“A good test might be to see if there is similar data for some other commodity or product associated with prior bubbles that burst.”

To test David’s idea, I have begun comparing price changes in commodities prior to the 1929 and 2008 stock market crashes. Preliminary data suggest that the pre-1929 and 2008 patterns are not similar, supporting the idea that this time it may be different. However, caution is required as this part of the story is too preliminary to make a call.

The above being said, the fluctuating signature on the chart may be a pointer that the world is either approaching or on the down slope from Peak Oil.

Chaotic change in the value or availability of a non-renewable resource often occurs during its terminal decline. A good example of this was whalebone , a material used for hooped dresses and corsets during the 19th century. The price of whalebone underwent large fluctuations as the whale species from which it came were hunted to near extinction.

In an example closer to our own time, Atlantic cod numbers landed off New England have shown whipsaw surges and falls in response to over fishing. The author Jeff Vail has used chaos theory to show interesting parallels between volatility in oil price and how prey populations in the wild vary in relation to predation.

Because of my day-job as a biologist who studies the heart, I visualize volatility spikes as resembling the pulses of bioelectricity that drive the heartbeat. These electrical pulses (we call them action potentials) fire after reaching a critical level. The pulses then electrically conduct through the muscle of the heart, causing it to contract.

It is imagined that volatility spikes in oil price also have to reach a critical threshold before they are of sufficient size to transmit knock-on effects on economic variables like inflation rate and investment risk.

To continue the cardiological analogy, like a rare mistimed heart beat that can fire out of sequence and cause a heart attack, it was suggested in the Oil Drum essay that the mysterious Black Monday stock market crash of 1987 could have been caused by a surge in oil price in the previous year set off by the collapse of the OPEC cartel.

On the time scale of the 24-hour news cycle, volatility spikes form slowly and for the most part, have been hidden from public view.

The volatility signature that formed over the 2000s has been too ponderous and below the radar for most to register. But to the overleveraged global economy, this near decade-long pattern of pulsed instability may have acted like repeating blows of a wrecking ball - each spike slamming with greater force into financial markets.

Wall Street behaved badly. However, this epic misbehavior was probably not the prime cause of the recession. Our dependence on oil is likely to be the real villain.

About : Therramus is a neutered tom. He can be contacted at

This article was written by which provides free information on crude oil.

"What do you want?" is a constant query put to economic and globalization activists decrying current poverty, alienation, and degradation. In this highly praised new work, destined to attract worldwide attention and support, Michael Albert provides an answer: "Participatory Economics" — "Parecon" for short — a new economy, an alternative to capitalism, built on familiar values including solidarity, equity, diversity, and people democratically controlling their own lives.

"Michael Albert has offered an alternative system of participatory economics to end the dehumanizing failures and injustices of free market capitalism. It is a compelling book for our times." — Ben H. Bagdikian, author of The Media Monopoly

"A program of radical reconstruction, presenting a vision that draws from a rich tradition of thought and practice of the libertarian left and popular movements, but adding novel critical analysis and specific ideas and modes of implementation. It merits close attention, debate, and action." — Noam Chomsky

"Michael Albert is an important thinker who takes us beyond radical denunciations and pretentious "analysis" to a thoughtful, profound meditation on what a good society can be like...." — Howard Zinn

"Capitalism not working for you? Michael Albert may be tilting at windmills, but readers are flocking to his book on a system to spread the wealth and work." — Los Angeles Times

"Parecon is a brave argument for . . . a much needed...more equitable, democratic, participatory...alternative economic vision." — Arundhati Roy

Michael Albert helped found and establish South End Press and Z Magazine, among other institutions. A long-time activist, he now maintains Z's internationally acclaimed web site Znet ( He has written numerous books and countless articles dealing with, among other topics, economics, vision, social change, strategy, globalization, and war and peace.

Deep thought - Jan 29

by Staff

Click on the headline (link) for the full text.

Many more articles are available through the Energy Bulletin homepage

Welcome to the Plutocracy

John Medaille, Front Porch Republic
onservatives have long believed that the power of the courts to “legislate from the bench” was a great and anti-democratic evil which could only be remedied by strict interpretation of the Constitution combined with sensitivity to the “original intent” of the founders and deference to the legislative branch. And they had good reason to believe this, since it is unlikely that the founders would have approved of many pieces of court legislation. Abortion, for example, could not be part of the original intent, and such a “right” is neither in the Constitution nor in its “penumbra” (to use Justice’s Douglas’s rather inventive term.) Indeed, many prominent features of American life are, for better or worse, not products of our democracy, but of our judicial system.

Alas, when conservatives themselves gain control of the court, it seems they are no better at exercising judicial restraint than are their liberal counterparts. Indeed, the “conservative court” has on several occasions completely changed the political landscape of the United States. This happened, for example, in Bush v. Gore, when the election was decided by five members of the court. And it happened again this last Thursday in Citizens United v. Federal Election Commission.

The case concerns a movie entitled “Hillary” (as in “Clinton”) put out by a non-profit corporation, “Citizens United,” whose president is Floyd Brown, a long time political activist who is credited, among other dubious achievements, with the Willie Horton ads. “When we’re through,” Brown remarked, “people are going to think that Willie Horton is Michael Dukakis’s nephew.” Brown came up with a clever way around the campaign finance laws which banned political ads from corporations or unions 30 days prior to an election. He would run ads for the movie, and since he was just advertising a movie, it wasn’t political advertising at all. Never mind that the movie, and the ads, were derogatory at best. The Federal Election Committee refused to go along with the ruse, and CU sued.

All CU wanted was for the court to bless their end-run around the campaign laws. Corporate contributions were not an issue in the case, and not part of the relief that plaintiffs were seeking. But for some unknown reasons, the court decided to re-hear the case on grounds that had nothing to do with the plaintiffs plea. The rehearing was peculiar, not only in widening the grounds of the case beyond the issues that were placed before it, but in ordering the rehearing for September 9th, a full month before the court’s session normally began. This seems to indicate some undue haste in deciding so pivotal an issue. One is tempted to think that the majority wanted this issue decided in time to dismantle the current laws in advance of the coming congressional elections. One is permitted to ask here whether the court’s agenda is judicial or political.

...The Founding Fathers of our Republic were very suspicious of corporations, since the royally-chartered companies had been used as instruments of oppression against the colonies. The Navigation Acts, for example, gave them exclusive shipping rights to the colonies, much to the detriment of American entrepreneurs. And it was East India Company tea that the colonists used to color the waters of Boston harbor in the original tea party. For a jurisprudence that pretends to be interested in “original intent,” the colonial attitude towards corporate power cannot be overlooked.

Corporations prior to Santa Clara were creatures of the state that had no “rights” save those that were granted by their charters, charters that always excluded their participation in politics. Santa Clara extended the protections of the 14th Amendment (no state shall “deprive any person of life, liberty, or property, without due process of law”) to the corporations. The Amendment was originally designed to protect the freed slaves, but since Santa Clara it has been used mainly as a tool to protect big business...
(25 Jan 2010)

The Neoliberal State

Raymond Plant, The New Statesman
Neoliberals wanted to limit government, but the upshot of their policies has been a huge expansion in the power of the state. Deregulating the financial system left banks free to speculate, and they did so with reckless enthusiasm. The result was a build-up of toxic assets that threatened the entire banking system. The government was forced to step in to save the system from self-destruction, but only at the cost of becoming itself hugely indebted. As a result, the state has a greater stake in the financial system than it did in the time of Clement Attlee. Yet the government is reluctant to use its power, even to curb the gross bonuses that bankers are awarding themselves from public funds. The neoliberal financial regime may have collapsed, but politicians continue to defer to the authority of the market.

Hardcore Thatcherites, and their fellow-travellers in New Labour, sometimes question whether there was ever a time when neoliberal ideas shaped policy. Has public spending not continued to rise over recent decades? Is the state not bigger than it has ever been? In practice, however, neoliberalism has created a market state rather than a small state. Shrinking the state has proved politically impossible, so neoliberals have turned instead to using the state to reshape social institutions on the model of the market - a task that cannot be carried out by a small state.

An increase in state power has always been the inner logic of neoliberalism, because, in order to inject markets into every corner of social life, a government needs to be highly invasive. Health, education and the arts are now more controlled by the state than they were in the era of Labour collectivism. Once-autonomous institutions are entangled in an apparatus of government targets and incentives. The consequence of reshaping society on a market model has been to make the state omnipresent.

Raymond Plant is a rarity among academic political theorists, in that he has deep experience of political life (before becoming a Labour peer he was a long-time adviser to Neil Kinnock). But he remains a philosopher, and the central focus of The Neoliberal State is not on the ways in which neoliberalism has self-destructed in practice. Instead, using a method of immanent criticism, Plant aims to uncover contradictions in neoliberal ideology itself. Examining a wide variety of thinkers - Michael Oakeshott, Friedrich Hayek, Robert Nozick, James Buchanan and others - he develops a rigorous and compelling argument that neoliberal ideas are inherently unstable...
(7 Jan 2010)

Parecon & Participatory Society

Michael Albert and Matt Grinder, znet
In this interview, Michael Albert, one of the originators of Participatory Economics (along with Robin Hahnel), is interviewed by parecon advocate Matt Grinder.

Matt Grinder: Could you briefly summarize Participatory Economics, or parecon?

Michael Albert: Participatory Economics, or parecon for short, is a vision for how to conduct economics in a classless manner. It delivers to workers and consumers self managed say over their economic lives, a condition of solidarity with others, equitable incomes for their labors, diverse opportunities and options, and ecological balance.

Parecon achieves the above by way of a few core institutions though, when implemented in real historic societies these core institutions would be augmented and refined depending on the society's development, its size, its history, and so on, with wide variations between countries, inside countries between industries, and even between workplaces inside industries. The core institutions, the part of economic vision it makes sense to conceive and advocate now, are:

· productive property that is overseen and directed by those it affects, as indicated below, but that is owned by no one - called participatory property.
· workers and consumers councils in which members, individually and collectively, have a say in decisions proportionate to the effect of the decisions on them, whether as individuals or in groups - called self management.
· remuneration for socially valued labor in proportion to duration, intensity, and onerousness of one's effort - called equitable remuneration
· a division of labor in which each worker does a mix of tasks conceived so that on average every worker's overall work situation is comparably empowering as every other's - called balanced job complexes
· allocation by cooperative negotiation among affected workers and consumers, acting through their councils - called participatory planning.

Grinder: Could you briefly summarize the four social spheres, and a participatory society?

Albert: Parecon is itself a vision only for a society's economy, but of course we want a good society in all key dimensions of life, not just one. Some centrally important spheres of social life that make sense to highlight and develop vision for are at least:

· the polity - or the institutions centrally responsible for adjudication, legislation, and implementation of shared agendas.
· kinship - or the institutions centrally responsible for birthing, nurturing, and training the new generation, as well as for sexuality, and what might be called daily social relations in living units.
· community/culture - or the institutions centrally responsible for how people define and celebrate their national, racial, ethnic, or other cultural identities, including cultural practices, celebrations, language, etc.
· economy - or the institutions centrally responsible for production, allocation, and consumption of goods and services...
(12 Jan 2010)
More about Parecon: Life After Capitalism here.