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The Ecological Crisis is an Economic Crisis; the Economic Crisis is an Ecological Crisis

category international | environment | opinion / analysis author Wednesday July 07, 2010 09:47author by Wayne Price - Personal opinionauthor email drwdprice at aol dot com Report this post to the editors

PART I: How Capitalism has created an Ecological, Energy, and Economic Crisis

The post-WWII boom was based on cheap oil. But oil is nonrenewable, polluting, and causes global warming. It was "cheap" because the capitalists did not pay to prepare for the day when it would be harder to access oil. We have reached that day, which is one aspect of the worldwide crisis of the return to the epoch of capitalist decay.

As I write this, the United States is suffering its worst ecological disaster since the Dust Bowl. Petroleum oil is gushing out of the ocean floor at BP’s drill site in the Gulf of Mexico. For it to be gotten under control may still take months, if it can be done at all. In any case, cleaning up the ecological and economic destruction in the region will take decades; some of the effects are irreparable.

There could be no greater illustration that the worldwide crises in ecology, in energy, and in the economy are not separate problems. They are aspects of one and the same crisis of industrial capitalism in its epoch of decay.

The Capitalist Economy Depends on Cheap Oil

Originally capitalism took off in the Industrial Revolution by using coal. Without coal,there might not have been any industrial capitalism. And coal burning was the beginning of the greenhouse effect.

Competitive (non-monopoly) capitalism reached its height in the 19th century. By the 20th century it was facing fundamental crises and limits to growth. (This was due to the growth of semi-monopolies throughout the economy interacting with the tendency of the average rate of profit to fall.) This was expressed through World War I, the Great Depression, defeated European and Asian revolutions, the rise of totalitarian fascism and Stalinism, and then World War II.

Economists of all schools expected WWII to be followed by, at most, a brief boom and then a return to depressive conditions. Instead there occurred the “post-war boom,” a “Golden Age” of capitalism—at least for the industrialized, imperialist, nations. It lasted from about 1950 to 1970. There were various reasons for this, including the reorganization of world imperialism, now centered in the U.S.; the history of working class defeats; and the expansion of “peacetime” military spending (the “Permanent Arms Economy” or the “military-industrial complex”).

But one major source of the boom after World War II was turning to the widespread use of cheap oil. Liquid petroleum oil is easier to transport and use than is coal, and, for a time, easier to get at. It became the basis for almost all forms of transportation, by land, sea, and air. It powers our machines in every area. Based on cheap oil, a whole new way of life developed after WWII: the suburbs. Today about half the U.S. population lives in suburbs. Cheap oil became the basis for the enormous automobile industry which in turn was the basis for the steel industry, while suburbization directly underlay the construction industry. The highly productive agricultural “industry” (i.e. farming) was dependent not only on oil-using tractors, etc., and trucks, but also on petroleum-based artificial fertilizers and artificial pesticides. And petroleum is used to make plastics. Plastic, chemicals, and artificial fibers are used in every aspect of our housing, clothing, and medical care.

In short, our entire way of life, our whole society, our food, clothing, and shelter, has been built on cheap oil. If petroleum became expensive and/or scarce, then all industry, the economy, and society would have to be reorganized. This is what we are now facing.

The Problems of Being Dependent on Cheap Oil

There are difficulties in being so completely dependent on petroleum oil. The first is that it is limited. Oil is a “nonrenewable resource.” Sooner or later we will run out of it. More significantly, sooner or later we pass the point of “peak oil.” This is the point where half the amount of oil in the ground has been used up. This point has been passed in the continental U.S. and we may be around it on a world scale. Meanwhile there has been an increase in the demand for oil as the world’s population increases and as oppressed nations (the “Third World”) attempt to industrialize.

That does not mean that there is no more oil. There is plenty still left. But it becomes harder to get at that oil. Once all that was necessary was to stick a pipe into the ground at the right place and oil would gush out. Now we have to set up huge floating rigs way out in the ocean and drill a mile down below the sea surface and then a mile or more below the sea floor. This was what was done at BP’s site in the Gulf of Mexico.

The second set of problems with dependence on oil is that it is polluting. Humans, other animals, and plants did not evolve to function in a world with oil and plastics in the environment. Burning it puts particles in the air. It poisons us, creates asthma and cancers. Plastics are “nonbiodegradable”; once “thrown away,” plastic materials last forever. Pesticide residue is poisonous to people and other animals. And right now we see the effects of releasing vast amounts of oil into the oceans—or rather we are just beginning to see the disasterous consequences.

Disasters are rationalized as “accidents,” such as the BP or the Exxon Valdez events or the Bhopal fire which spewed pesticides over a large area of heavily populated India. But human activities are never perfect and never will be perfect. No matter how many safety mechanisms are built into the processes, accidents will happen. (This is also true of attempts to make “safe” nuclear power as an alternative to burning fossil fuels. There is no safe nuclear power. Accidents will happen.)

Finally, there is the effect of “global warming,” climate change. More than just pollution, this throws the whole worldwide climate out of balance. It is melting polar ice and ice caps on mountains. It is raising the level of the sea and will drown islands and sea coasts and the peoples who live there. It will spread deserts and cause famines. It short, it will be a civilization-wide disaster.

Another difficulty is that oil, like many other natural resources, is not evenly distributed around the world. A few places have a lot and most places have none. This has played into imperialism, wars, and corrupt dictatorships. For example, right now the U.S. is fighting in Iraq (which has the world’s second largest oil deposits) and Afghanistan (which has pipelines for natural gas go through it).

What I have said about oil is also true about other fossil fuels, namely coal and natural gas. They are also nonrenewable, limited, resources. Getting at them causes destruction of the ecological environment (e.g. mountaintop removal for coal or fractioning natural gas-bearing ground). They also have negative effects on humans and the ecology, including contributing to global warming.

The use of oil and other fossil fuels has been essential to the last period of capitalist prosperity and now threatens disaster both ecologically and economically. But there are other ways in which industrial capitalism has plundered the natural world, looting its resources without paying for rebuilding them. Other minerals have been torn from the ground and released into the human environment where they do not fit our biology, such as mercury. Whole animal species are being exterminated in a continuing process, while jungles and forests (the “earth’s lungs”) are being cut down. Diseases spread through the mass use of airplane travel.

Much of this has happened as side effects of the expansion of big farms and ranches, mines and dams, and sprawling human cities and suburbs. Ruthlessly and thoughtlessly, industrial capitalism slashes the threads of the web of life in which humanity lives.

The Bill Comes Due

Imagine the capitalist management of an industrial factory. As they produce commodities, their machines and buildings (what Marx refers to as “fixed constant capital”) wear out a little. They take account of this by adding a cost to the price of the commodities. Over time they accumulate a fund so that, when the machines and buildings are worn out, they can buy new machines and structures.

But suppose they do not do that? Suppose they do not set aside a fund to rebuild the worn-out machinery but instead count that money as part of their profits (Marx’s “surplus value”). Perhaps, under pressure from their workers, they use some of that money to increase the workers’s wages (Marx’s “variable capital”). This makes their profits look larger than they really are and it permits the capitalists to buy off the workers without losing any profits. But someday the machinery does wear out and the capitalists do not have money to replace it. Factory production will stagnate. Workers will be laid off. The high profits and the workers’ high standard of living will suddenly appear to have been fraudulent.

This is the situation of the world bourgeoisie as a whole in relation to the environment. The capitalists had seemed to be making huge profits and been able to buy off much of the working class (at least white workers in the imperialist countries). They had been looting the environment, ripping out natural resources which they had not created, counting as proft what nature appeared to be giving for “free” (a version of what Marx called “primitive accumulation”). They thought they were getting something for nothing, or at least for very little.

What the capitalist class should have been doing was to prepare for the day when energy and other resources would run out, or more accurately, would become rarer and much more expensive to access. It should have begun a transition from fossil fuels (and nuclear power) to renewable energy. It should have been cleaning up pollution and countering greenhouse effects. It should have fought desertification in Africa and elsewhere. It should have worked to balance population growth with economic growth by liberating women worldwide. It should have maintained the world’s jungles and forests and prevented overfishing in the oceans. It should have planned cities and towns so they did not destroy the countryside or need so much energy for transportation. And so on.

Nor is this only a matter of the environment and of energy. The capitalist class has failed to maintain the infrastructure and social services needed for advanced industrial nations such as the U.S.A. It should have been replacing water main pipes, train systems, dams, city housing, roads and highways, bridges, and schools. But it has not.

The capitalist class has not done what it should have to maintain its system and prepare for necessary changes. Of course, if it had done this, the post-WWII prosperity might have been less prosperous. There might have been more class struggle by the workers against the capitalists.

Now the bill has come due. The machinery is worn out and needs replacement, but the bourgeoisie does not have the price—not without cutting into profits (which is unthinkable for them) or cutting way down on the workers’ pay and standard of living (which is definitely thinkable but which might cause working class unrest).

So the ecological crisis is an energy crisis and an economic crisis, and is also a political crisis.
There will be a great deal of suffering for many people in the coming years. There will be great social upheavals and mass struggles, the end of the conventional political consensus and the rise of the far-right and the far-left, including varieties of revolutionary anarchists and socialists. This has already begun to happen.

In PART II, I will discuss why the capitalist class cannot solve the ecological/energy/economic crisis and what program should be advocated by revolutionary anarchists.

Written for

author by readerpublication date Wed Jul 07, 2010 23:50author address author phone Report this post to the editors

glad to see Wayne back with his essays to anarkismo. Looking forward to reading the second part.

author by Waynepublication date Thu Jul 08, 2010 08:00author address author phone Report this post to the editors

A reader wrote to me, about the phrase in the introductory paragraph above, "the worldwide crisis of the return to the epoch of capitalist decay." Did I mean that the post-WWII boom was not in the epoch of capitalist decay? he wanted to know.

It was a poor formulation on my part. What I meant was that the symptoms of the epoch of decay, the superficial, overt, aspects of the epoch of decay, were suppressed and it seemed like a return to the Golden Age of capitalist properity. However, like a medicine which only suppresses the symptoms of an illness, the underlying disease continued to spread and would someday break out again symptomatically, even worse than before.

author by Ilan S. - AAtW; ainfos; Matzpenpublication date Thu Jul 08, 2010 21:46author address Tel Avivauthor phone Report this post to the editors

The first illogical "crime" is called "Pars Par Toto". It means concentration on one aspect of phenomena while ignoring the whole.

For sure change in the rate of profits is important. Revolutionary changed in the technology are responsible to qualitative epoch change... However, the main problem of the capitalist system is the accumulation of the surplus value and its investment.

In the less monopolized capitalism the struggle for survival of companies forced them to invest money and compete with rivals - where the less efficients were pushed to bank rot.

In the modern capitalism there is less competition and lot of surplus value is lent to working class consumers...

In addition, huge part of savings (pensions) of working class is a "capital savings" in need to investment (usually with lower rate of profit) while the big capitalist firms borrow it and have entirely different rate of profits.

When the concentration of capital resulted in the neo-liberal globalization with the hegemony of multi national conglomerates, a huge surge of the expanding of the world capitalism occur - mainly in East Asia.

For sure the adjustment of the world capitalist system involve crisis and more so in the financial system, but do not hold your breath for the decline in the capitalist system.

Like the ecological threat of the hole in the Ozone of not long ago that was overcome, so will be overcome the newer ecological of worming - it will just need a huge adjustment.

The revolution will not come from a technological crisis -it will come when the authoritarian non egalitarian capitalist system will loose its credibility in the eyes of the majority of the world working class masses.

It will probably will erupt - be triggered by one of the future crises of the capitalist system but is too early to predict what specific content will it have.

author by Waynepublication date Fri Jul 09, 2010 05:02author address author phone Report this post to the editors

Ilan lays out his theory of capitalist development. I do not quite understand him, which may be due to his having to explain it in such a brief space. In any case he does not respond to my argument, which is not about a specific, short-term, crisis but about a trend to stagnation caused, in part, by the rising costs of fossil fuels--the basis of our whole technological society.

I fully agree that "the revolution will not come from a technolkogical crisis," that is, it will not be an automatic reaction to a technological or economic crisis. But the crieses of capitalism do cause much suffering and disscredit the sysstem in the eyes of millions.

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