Globalisation is an Anomaly and Its Time is Running Out
Cheap energy and relative peace helped create a false doctrine
by James Howard Kunstler
The big yammer these days in the United States is to the effect that
globalisation is here to stay: it's wonderful, get used to it. The
chief cheerleader for this point of view is Thomas Friedman,
columnist for the New York Times and author of The World Is Flat. The
seemingly unanimous embrace of this idea in the power circles of
America is a marvellous illustration of the madness of crowds, for
nothing could be further from the truth than the idea that
globalisation is now a permanent fixture of the human condition.
Today's transient global economic relations are a product of very
special transient circumstances, namely relative world peace and
absolutely reliable supplies of cheap energy. Subtract either of
these elements from the equation and you will see globalisation
evaporate so quickly it will suck the air out of your lungs. It is
significant that none of the cheerleaders for globalisation takes
this equation into account. In fact, the American power elite is
sleepwalking into a crisis so severe that the blowback may put both
major political parties out of business.
The world saw an earlier phase of robust global trade run from the
1870s to a dead stop in 1914. This was the boom period of railroad
construction and the advent of the ocean-going steamship. The great
powers had existed in relative peace since Napoleon's last stand. The
Crimean war was a minor episode that took place in backwaters of
Eurasia, and the Franco-Prussian war was a comic opera that lasted
less than a year - most of it the static siege of Paris. The American
civil war hardly affected the rest of the world.
This first phase of globalisation then took off under coal-and-steam
power. There was no shortage of fuel, the colonial boundaries were
stable, and the pipeline of raw materials from them to the factories
of western Europe ran smoothly. The rise of a middle class running
the many stages of the production process provided markets for all
the new production. Innovations in finance gave legitimacy to all
kinds of tradable paper. Life was very good for Europe and America,
notwithstanding a few sharp cyclical depressions and recoveries.
Trade boomed between the great powers. The belle époque
represented the high tide of hopeful expectations. In America, it was
called the progressive era. The 20th century looked golden.
It all fell apart in 1914. Historians are still baffled about what
really brought on the first world war. What did France or Britain
really care about Austrian archduke Franz Ferdinand, heir to the
throne of a country already in deep eclipse? There were no active
contests over territory at the time, not even in the Asian or African
colonies. And yet the diplomatic failures of that fateful summer led
to the great slaughter of the trenches, the death of a substantial
portion of the younger generation, and a virtual nervous breakdown of
authority in politics and culture. It would take a depression,
fascism, and a second world war to resolve these issues and a new
round of globalisation did not ramp up again until the mid-1960s.
It may be significant that the first collapse of globalisation
occurred as the coal economy was transitioning into an oil economy,
with deep geo-political implications for who had oil (America) and
those who might seek to control the other major region closest to
Europe that possessed it (then the Caspian, since Arabian oil was as
yet undiscovered). The first world war was settled by those nations
(Britain and France) that were friendly with the greatest producer of
oil most readily accessed. Germany was the loser and again in the
reprise for its poor access to oil. Japan suffered similarly.
We are now due for another folding up of the periodic global trade
fair as the industrial nations enter the tumultuous era beyond the
global oil production peak, which I have named the long emergency.
The economic distortions and perversities that have built up in the
current era are not hard to see, though our leaders dread to
acknowledge them. The dirty secret of the US economy for at least a
decade now is that it has come to be based on the ceaseless
elaboration of a car-dependent suburban infrastructure - McHousing
estates, eight-lane highways, big-box chain stores, hamburger stands -
that has no future as a living arrangement in an oil-short future.
The American suburban juggernaut can be described succinctly as the
greatest misallocation of resources in the history of the world. The
mortgages, bonds, real estate investment trusts and derivative
financial instruments associated with this tragic enterprise must
make the judicious goggle with wonder and nausea.
Add to this grim economic picture a far-flung military contest,
already under way, really, for control of the world's remaining oil,
and the scene grows darker. Two-thirds of that oil is in the
possession of people who resent the west (America in particular),
many of whom have vowed to destroy it. Both America and Britain have
felt the sting of freelance asymmetrical war-makers not associated
with a particular state but with a transnational religious cause that
uses potent small arms and explosives to unravel western societies
and confound their defences.
China, a supposed beneficiary of globalisation, will be as desperate
for oil as all the other players, and perhaps more ruthless in
seeking control of the supplies, some of which they can walk to. Of
course, it is hard to imagine the continuation of American chain
stores' manufacturing supply lines with China, given the potential
for friction. Even on its own terms, China faces issues of
environmental havoc, population overshoot, and political turmoil -
orders of magnitude greater than anything known in Europe or America.
Viewed through this lens, the sunset of the current phase of
globalisation seems dreadfully close to the horizon. The American
public has enjoyed the fiesta, but the blue-light special orgy of
easy motoring, limitless air-conditioning, and super-cheap products
made by factory slaves far far away is about to close down.
Globalisation is finished. The world is about to become a larger
James Howard Kunstler is the author of The Long Emergency: Surviving
the Converging Catastrophes of the Twenty-First Century.
Published on Thursday, August 4, 2005 by the Guardian (UK)