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Money vs fossil energy: the battle for control of the world

This essay provides a framework for understanding the ideological roots of the current global crisis that I believe is more useful than the now tired Left Right political spectrum. I use this framework to provide a commentary on current political machinations around Climate Change and Peak Oil. Building from the same energetic literacy that informs Permaculture and Future Scenarios, it challenges much of the strategic logic behind current mainstream climate change activism. Like the Future Scenarios work, this essay is intended to help environmental and social activists better avoid the obstacles to effective action in a chaotic age.

David Holmgren is best known as the co-originator of the permaculture concept. He lives with his partner Su Dennett at Melliodora, a permaculture demonstration site in Hepburn, Central Victoria.

[This posting at EB consists of selections from the original essay. The PDF of the complete essay can be downloaded from David Holmgren's website in the "Writings" section.]

The unfolding climate/energy/economic crisis is heating up a very old rift in global industrial politics. This rift derives from two core beliefs on what constitutes the source of wealth. Does wealth come from human creativity and innovation or is it found in the natural world? Is human capacity the source or a by-product of real power?

I believe two alternative (and mostly complementary) paradigms that are implied by these questions, have shaped the history of the modern world perhaps more so than the Left-Right political ideologies. I characterise these increasingly conflicted paradigms by the following shorthand: faith in wealth and power from “human brilliance” (meaning “faith in human brilliance to overcome physical limitations.”) verses faith that wealth and power emerge from control of “holes in the ground”, ie. physical resources.1

In a world of energy descent and climate change, both these beliefs are failing and increasingly we see the believers of both paradigms at war in a futile battle for control of the world. and

Understanding the nature of this ideological battle is as critical for environmental and social activists as is the understanding of the science behind Climate Change and Peak Oil. Because this ideological divide and battle has been little recognised by historians and social commentators, it is easy to come to the conclusion that one of these paradigms is benign while the other is lethal, without really understanding the nature and implications of these respective ideologies.

Climate activists in particular tend to focus on the fossil energy industries as the “enemies” (both for generating greenhouse gases and funding climate change denial), but naturally see any parties accepting the new climate change agenda as allies. I believe that many of the global players promoting the climate agenda are as dangerous as those denying that agenda. How can this be so?

Ecological perspectives on human brilliance

I should first acknowledge my perspective in this rift. I believe that the current peak in global oil production represents an effective (net) energy peak for humanity and that we are entering an era of ongoing and effectively permanent “energy descent.” The scale of this change is without precedent in human history. A transition to a world of less energy requires widespread “energetic literacy” so that we can learn how to work with less and avoid some costly mistakes when we can least afford them. The era of extraordinary energy growth and abundance has left the populace and the politicians of the industrial world without an intuitive understanding of energy, since, by its very excess we have not needed to appreciate its nuances.

... Consequently this essay more strongly critiques the unrestrained faith in human creativity and innovation to overcome physical limitations, than the equally doomed faith in digging wealth out of the earth, since the latter, if becoming outdated, at least acknowledges the significance of energy resources.

Faith in Human Brilliance

Faith in human brilliance to overcome physical limitations is widespread and pervasive in society.

Since the European Enlightenment, the marvel of increasing cultural and technological complexity has created a cultural hubris about human achievements that has displaced the humility of older spiritual traditions about the power and mystery of nature.

For example many social justice and environmental advocates, as well as bureaucrats and diplomats believe the construction of regulations and rules based on negotiation and compromise are the fundamental keys to collective wealth and its wise control. Technologists, educators, and journalists also tend towards the belief that thinking, discussion and debate are the way to solve problems. Economists and business entrepreneurs tend to share this faith in human brilliance and have been much more powerful participants in focusing the tools of science to create real wealth though production and market transactions. While there is obvious merit and some truth in these perspectives, they are incomplete insofar as they ignore the energy base which makes these perspectives possible.

... Our money and markets are the most complex products of this deeply ingrained faith in human brilliance. And just as their foundational beliefs are incomplete, so is their expression extremely dangerous. ...

Wealth from Nature

While faith in human brilliance might be to the dominant paridigm, a significant and number of influential people in modern society hold the opposite belief: that wealth comes from nature (in which I include the belief that wealth comes from “holes in the ground”). Because so few people in modern urbanised societies have intimate experience of the ways in which we depend on renewable and non-renewable natural resources, the intuitive basis for these beliefs has been in decline for hundreds of years.

Farmers, forest workers and fishermen along with more self-reliant rural dwellers are natural adherents to this view of the world. Miners and engineers dependent on and responsible for the exploitation of nature’s non-renewable wealth also tend to hold this view for fairly obvious reasons. The military services are another sector of society where this world view remains common. Those who recognise this potent power from nature often conclude that the power of the gun is ultimately what guarantees control, especially of the “holes in the ground” that yield the fantastically concentrated non-renewable energy and resources. Unlike capitalists and socialists, many of those with faith in power from the ground, are less concerned whether the total system is growing, stagnant or declining, but more focused on how to remain on the top of the heap, whatever its size.

... As I have pointed out, faith in human brilliance can focus on individual and entrepreneurial capacity (Right) or alternatively, collective and co-operative capacity (Left). Similarly faith in power from nature can lead to the conclusion about “survival of the fittest” (Right) or co-operative sharing of limited resources (Left). ...

History of beliefs in energy and money

To understand how conflict between money and energy in modern society is shaping the climate/energy/economic crisis, we need to explore its historical origins. I believe this exploration using the lens of ecology is part of a larger process by which we begin to tell a new story of human transformation relevant to the energy descent future after fossil fuels.

The ancestry of the first force – the belief that wealth comes from “holes in the ground”, i.e. physical resources we mine from the earth – can be seen in the feudal lords who presided over tracts of fertile farmland and productive forests that were the primary sources of material wealth before fossil fuels. These feudal elites had an intimate knowledge of the estates that were the source of their wealth and power and so maintained a sort of “energetic literacy” even if they regarded the productivity of the land as primarily a gift from god. The successes of European medieval societies based on the limited but renewable resources of the land eventually came up against ecological limits that were expressed through loss of forests, wars between sovereign nations, and disease (the Black Death). ...

Wealth from Human Ingenuity

The ancestry of the second force, the belief that “human brilliance” is the source of wealth, can be traced back to the urban intellectuals and merchants of the European Enlightenment who believed that human ingenuity and organisation were the critical forces in wealth creation and control. While wealth from colonised lands provided the material wealth for European expansion, cultural factors associated with religion (the Protestant reformation) and capitalism (sovereign corporations and modern banking) were critical in facilitating the process. Central to this thesis were the ideas of Adam Smith and others who eulogised the “invisible hand” of the market and castigated the medieval guild economies that Smith saw as impeding progress. The guilds regulated their respective trades or professions to maintain traditions and high standards of craft while controlling competition and discouraging radical innovation. The fact that the guild economies were adapted to the steady-state economy of the middle ages has escaped the notice of most of the academic cheerleaders for market-based economies of continuous growth.

Marx is of course the great ideological counterpoint to Smith’s adoration of the role of capital in creating wealth. Marx saw that human labour and cooperative capacity were the undervalued sources of wealth that capitalists exploited to convert natural resources to real wealth. I see Marxism and societies designed on Marxist principles – both mild and radical variants – as simply different expressions of this same tendency to believe that human labour, creativity and organization are the sources of wealth.

This faith in “human brilliance” in both its capitalist and socialist forms must be acknowledged as drivers of the growth in European economic power and organisational complexity that overpowered the older land-based feudal power.

...The IT revolution was the key factor in the final push towards a full spectrum globalised economy dominated by corporations, but it was the ballooning virtual economies of finance and investment services that benefited most from the IT revolution. While much was made of the individual and social network empowerment potential that eventually emerged after the turn of the millennium, vastly more IT capacity is taken up by porn than is used by wikipedia, and the breakdown of communities of place and isolation of individuals most likely exceeds the gains from the extraordinary but fragile network communities made possible by the internet. All of these processes expanded the power of money at the expense of awareness of the role of energy in feeding the machine of economic growth.

... It is clear enough that the dominance of the West over OPEC, Russia and the Central Asian republics reinforced the faith in the power of markets over crude resources from holes in the ground. In the 1990s analysis suggesting resource rich countries were more likely to have dysfunctional economies, corrupt governments and conflict than resource poor countries, was perversely interpreted as showing how marginal these resources were to the human progress. The alternative explanation, that this pattern reflected the hegemonic control of an oppressive geopolitical order by the resource consuming countries, was less widely acknowledged. Both interpretations reinforced faith in the power of human creativity and money over resource wealth.

This is part of a collective mythology of modernism, that wit and cunning (of the city trader) always outsmarts honest hard work (of the farmer).

Peak Oil and Resource Nationalism

The turn of the millennium saw new factors at work. Rising oil prices, increased gas production and dependence of European countries on Russian gas has provided a strong base for resurgent Russian economic and political power. Under Putin plundering of Russian resources by the oligarchs to feed the West was replaced by a resurgent Russian nationalism that shocked western corporations and media.

In the US, the Bush administration, controlled by oil men and military strategists, sidelined the diplomats and the bankers that held sway during the Clinton years with a renewed focus on control of the oil resources of the Middle East and the gas resources of Central Asia.

9/11 provided the green light to shock western democracies from their slothful assumption about resource security through total war. Judging by their actions, and various statements, it seems likely that many key advisors and actors in the Bush administration were better informed about the parlous prospects for global oil and gas production in the coming decades than the most gloomy and best informed of Peak Oil researchers and communicators to whom I was paying attention in the late 1990’s.

But to portray the Bush administration as just representing the forces of energetic realism would be false, because domestically, the “Mandarins” of Treasury and the Federal Reserve were freed to blow the most spectacular bubble economy in history. These masters of money created castles in the air of unprecedented proportions based on real estate speculation and consumption debt. The partial collapse of this bubble economy can be seen as the most important factor in the demise of Bush administration, rather than the loss of civil rights, or abuse of international law in pursuit of its fantastic “war on terror”. The timing of the collapse of the bubble economy acted to distract the media and the public from the likely concurrent peak of global oil production, and the contribution of oil (and other resource) price spikes to the global recession. ...

Permaculture: harmonising energetic realism & design creativity

While my analysis of the more basic forces at work behind the current political machinations may be interesting, my purpose is not simply armchair analysis. The love of money and greed for energy are both monstrous cancers of our culture. We need to better understand both so we can predict their moves, and plan our own actions for resilient transition into a new culture not beholden to fossil energy or money. The idea that we have to choose between allying ourselves with either of the dangerous wounded monsters is a false choice.

My aim is to empower environmental activists, social entrepreneurs and humble householders to be most effective in three simultaneous domains of action.

  1. Help their families survive and thrive through turbulent times

  2. Contribute to a better society than would otherwise have been the case
  3. Contribute to the preservation and development of skills that will be useful to future generations grappling with the realities of energy descent.

The idea that we have to choose between allying ourselves with either of the dangerous wounded monsters in their life and death struggle for control of the declining era of fossil fuelled industrial culture, is a false choice. We should heighten our awareness of the nature of both of these monstrous cancers of our culture, so we can better predict their moves, and plan our own actions for resilient transition into a new culture not beholden to oil or money.

I see permaculture, especially when it is understood through its ethics and design principles, as providing a framework for creating that culture, based on the regenerated cycles of nature. Anyone who is familiar with permaculture ethics, design principles and strategies will understand that my equal rejection of the respective power from fossil energyoil and money does not indicate that I see no useful core of truth in these primal tendencies driving our waning global industrial culture.

In using the term “energetic realism” to describe one of these forces, I am acknowledging see the living and non-living elements of Gaia as the foundation for any human wealth. Through my teaching of permaculture, I have always emphasised that fossil fuels are not bad, but a gift from nature, that we have wasted. Permaculture earthworks designs make use of the raw power of fossil fuelled machines to shape the land in ways that allow us , and future generation,to enhance the biological productivity of landscapes. We have the unique opportunity to use that fossil fuel to create those structures that future generations will be able to maintain (by hand if necessary).

In using the term “human brilliance” to describe the creativity that includes concepts as complex as money, I recognise acknowledge human creativity and flexibility to adapt to changing circumstance is the best asset we have. While we do not have the power to rewrite the laws of thermodynamics that limit and shape human realities, we do have a remarkable capacity to reshape our individual and collective conception of reality in ways that facilitate rather than hinder cultural evolution.from first principles to reflect energetic realities and ethical valuescan be redesigned money that While we do not have the power to rewrite the laws of thermodynamics that limit and shape human realities, we do have a remarkable capacity to reshape our individual and collective conception of reality in ways that facilitate rather than hinder cultural evolution. Money is simply a collective mental construct that we can redesign from first principles to reflect energetic realities and ethical valuesand change.
The old saying that it is the love of money rather than money itself which is the source of evil in the world is worth repeating. that ye ou[You lost me here, ]This saying can be further interpreted to mean money that is arbitrarily created, without being tied to real wealth from nature, and that every day earns interest, that must be repaid by growth in our extraction of real wealth from nature, has embedded the love of money as central to our culture.
Permaculture strategies for creating household and community economies using gift, barter and simple non-interest bearing local currencies, are examples of how we can design new forms of money to allow appropriate exchange of goods and services in resilient and relocalised economies that will grow at the margins abandoned by the dinosaurs of the declining global industrial culture.

Let’s not waste our effort or emotions on hoping that either of the dinosaurs will save us; rather, let us get on with our tasks while we keep an eagle eye open for any threats from both fossil energyoil and money.

About David Holmgren
david02.jpg Holmgren co-wrote the first permaculture text Permaculture One in 1976 with Bill Mollison (published in 1978). With his 2002 book Permaculture: Principles and Pathways Beyond Sustainability David re-emerged from the relative shadows as the leading intellectual force of the permaculture movement. Rob Hopkins, founder of the popular Transition Towns initiatives in the UK, described Principles and Pathways as “the most important book of the last 15 years.” Holmgren's most recent book is Future Scenarios: How Communities Can Adapt to Peak Oil and Climate Change

Editorial Notes: A PDF of the complete article is available on David Holmgren's website in the "Writings" section. -BA

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