Energy Transition & the Luxury Economy

That is great! It starts with an earthquake
Birds and snakes, airplane
and Lenny Bruce is not afraid.

REM, it’s the end of the world as we know it

I spent a good part of my day yesterday listening to and reading Simon Michaud, who I now consider one of the most important thinkers in our world. I really cannot overstate his importance. He should be a household name. Before yesterday I had only the faintest acquaintance with the man and his ideas. But now it’s like I’ve crossed a bridge and see the world in a whole new light. This new light is characterized by something as close to certainty as I can get about anything. A person is almost never 100% sure of something. It’s good to keep an open mind. But sometimes some things are very, very close to certain. It is in this light that I now view the popular narrative of energy transition. This narrative is simply simple fake. It’s not just a little false, but it is dramatically fake. That is, capitalist industrial civilization – as we know it – not only will not continue in the same form as it does now, using only renewable energy sources, but it cannot continue at all. It’s basically over. It works with smoke. Those days are numbered and few. Much less than most people imagine. Much less than we are ready or yet to prepare.

I was already on the verge of this almost total belief, and have been on this verge for several years, but then Richard Heinberg recently came out and said that the energy costs of the energy transition are such that there will definitely be “pulse” from fossil energy consumption and the associated greenhouse gas emissions associated with the massive construction of “renewable energy” infrastructure and devices. If I understand Heinberg correctly, he is saying that over many years of building this “renewable” energy infrastructure around the world, the result would almost certainly be increase, rather than the reduction of greenhouse gas emissions, making the “energy transition” completely antithetical to its main stated goal. After all, as people like Kevin Anderson have been saying for years, emissions reductions have to start nownot in a decade or more.

What Richard Heinberg didn’t mention in that article is that it is theoretical believable that all of this renewable energy infrastructure could be mined, smelted, produced, transported and installed without increasing greenhouse gas emissions Yes humanity has had to dramatically reduce energy consumption, quite rapidly in most cases other in the economic sector. But are we really the kind of people who will give up cars, mass global tourism, and a luxury, luxury-dependent economy just to replace fossil fuel infrastructure with renewable energy infrastructure? It is whether we will actually deploy this massive build-out of renewable infrastructure as our own the top priority as culture and civilization – to giant sacrifices in other energy sectors?

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But there is another, deeply related question. And this has been answered by Simon Michaud. The question is… Is it even possible replace enough of the world’s fossil energy with renewables to maintain the capitalist industrial technological economy that has engulfed most of the world? In a nutshell, Micha says no. It’s impossible—certainly not in the time frame that matters. We just don’t have enough of the necessary metals and minerals to do that, he says. And he backs it up very strongly with extensive documentation.

Can we produce some infrastructure and some from these devices (eg electric cars, solar panels, wind turbines…)? Yes, but they won’t exist a the amount which would allow a technological civilization as we know it to continue. Period. Point.

So what does this mean?

Speaking of itself, it means it’s the beginning of the end of the world as we know it — in almost every respect. The transition of our energy systems cannot be simple, smooth. This means that this is the beginning of the end of the economy as we know it.

The popular version of the “energy transition” has been a story of the maintenance of the economic, technological and socio-political regime with only a few relatively minor adjustments, rather than a dramatic transformation. This story just doesn’t stand up to scrutiny. Hence the concept of “climate action” and climate politics that dominate activist circles today. All of this requires not a minor tweak, but a rather dramatic overhaul (and redesign).

Both Heinberg’s Pulse and Michaux’s Monkeywrench bring to light two central and deeply interconnected facts. These are:

  1. An energy recession (and therefore an economic contraction as measured by GDP/GSP) is inevitable in the near term.
  2. We live in the last days of what I call the “luxury economy”.

If you click on the words “energy landing” you will be taken to the Wikipedia article on the subject. Energy abscission is defined as “the process by which a society voluntarily or involuntarily reduces its overall energy consumption”. My contention is that we are alreadyinevitable when entering energy descent based on both voluntary and forced processes, although global net energy consumption continues to temporarily increase. This means that the growth of global net energy consumption has peaked, and we are only now discovering that this is the case. Permanent global net energy consumption will begin to measurably decrease very in the near future whether we like it or not. (But we are partial choosing to voluntarily begin this process… even if coercive processes will force it despite at our option. So there’s a bit of a paradox here, because we also don’t seem to have measurably started the energy descent voluntarily. or involuntarily. Imagine that it has revealed a large cutout in the hull of the ship we are on. The ship has not yet begun to sink. But there is still a peak. Heinberg’s “pulse” and Michaux’s monkey key serve as illuminations for the situation in which we find ourselves. A ship called Normal will not stay afloat. It goes down. And pretty soon the “(popular) narrative” will also change and we will no longer pretend otherwise. But we are now on the threshold of this insight as a civilization. The narrative needs to change because it is fake.

What is “Luxury Economy”?

I define luxury economy as a type of economy access to livelihood which depends on luxury goods and services to avoid economic and social collapse.

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I can’t think of a better way to express this luxury economy concept than to start with this graphic.

In 1840, about 70% of Americans worked in agriculture. In 2020, only 1.3% of Americans worked in agriculture. Agriculture as a means of livelihood is avatar needs-based economic activities (economic sector). After all, people have to eat. But technological “advances” in agriculture (mainly in the form of farm machinery) allowed dramatic changes in the intensity of agricultural labor, and this diagram is mainly about replacing practical human work with machine work or dramatic. the increase in “units of productivity” per man-hour of work. As human labor became less and less necessary for food production and the “development” of technology similarly affected most other sectors of need-based economic activity, luxury-based and luxury-dependent modes of economic activity enabled displaced workers to access livelihoods through employment in the production of goods and services. and distribution that was considered a luxury in 1840 or 1900 or 1940. Historically, the US economy has become increasingly dependent on non-essential economic activity in the direction of decline, which resembles the same process that happened in agriculture, making the US one of the leaders in depending on the “luxury economy” just to provide its citizens with access to subsistence.

Today’s luxury economy is machine-centric and heavily dependent on exosomatic energy. A needs-based economy is smaller and uses proportionally more endosomatic energy. Endosomatic energy is the energy you use when you swing a hammer or ride a bicycle. Exosomatic energy is the energy used by your car engine or your farm tractor. The economy of the future will use proportionally more endosomatic energy.

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Of course, people differ greatly in what they consider ‘essential’ and what they consider ‘luxury’. I think if I had to provide the epitome of energy- and material-intensive luxury, I’d have to put cars pretty high up, even though some people’s lives would be dramatically disrupted if they were forced to live without a car. Another great example of luxury goods and services would be air travel. And these two elements are among the biggest contributors to fossil fuel consumption and greenhouse gas emissions. Life without a car can be a challenge, but in most cases it won’t lead to starvation or abject misery. And importantly, we could rearrange things to make living without a car much, much easier.

The future of our economies everywhere in the ‘developed world’ (aka the global north, the rich world) will be much less dependent on the provision of luxury goods and services, and especially those luxury goods and services that are energy intensive, whether or not they directly uses fossil fuels.

The transition to a smaller, slower, and less energy-intensive economy will be made much smoother and more enjoyable if we make these changes consciously, intelligently, and voluntarily. If we wait to be forced to do so by unavoidable but unavoidable circumstances, it will be an unimaginable disaster.

Unfortunately, governments are unlikely to lead the way in adopting policies that introduce and enforce a voluntary energy (and economic) divestiture. Indeed, it seems unlikely that they will adopt such a policy just yet. It is likely that we will have to start acting as communities outside of governments to envision and implement this transformation before governments. This will require a paradigm shift in politics—a shift from national politics to local community politics that largely operate outside of government. I suspect that only then will governments begin to consider going with us. But we shouldn’t count on it, I think. As I often say, a leopard is unlikely to change its spots.

Regardless, let’s lead as free people. To be free, you must first be able to imagine freedom.

1 Heinberg Pulse is the energy cost of the ‘energy transition’, which recognizes that greenhouse gases must be increase in the near future to build renewable energy infrastructure in the near future if the popular image of the “energy transition” is accepted.

The Michaux Monkey Key is the monkey wrench thrown into the theoretical gears of the “energy transition” when we admit that the world can’t possibly provide enough of the rare and rare.ish metals and minerals to enable the popular vision of an “energy transition”.

Teaser photo credit: Usien – Own work, CC BY-SA 3.0,


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