[Marxism] Mike Davis on Hubbert's Peak

Louis Proyect lnp3 at panix.com
Tue Jun 1 15:44:40 MDT 2004


(This appears in the British SWP magazine Socialist Review at: 
http://www.socialistreview.org.uk/article.php?articlenumber=8930. It is 
similar to an article that appeared on tomdispatch.com a month ago, but 
contains critical support of Ralph Nader, something that was absent in 
the earlier article.)

The View from Hubbert's Peak

Column by Mike Davis, June 2004

Diminishing oil supplies have epochal implications for the world economy.

Angry truckers celebrated this May Day by blocking freeways in Los 
Angeles and container terminals in Oakland and Stockton. With diesel 
fuel prices in California soaring to record levels in recent weeks, the 
earnings of independent container-haulers have dropped below the poverty 
line.

Lacking the power of big trucking companies to pass rising fuel costs on 
to customers, the port drivers - many of them immigrants from Mexico - 
have had little choice but to share some of their pain with the public. 
In one action, abandoned big rigs blocked the morning commute just south 
of downtown Los Angeles on Interstate 5. Tens of thousands of motorists 
became temporary hostages of the fuel crisis. As one exasperated 
commuter complained to a radio station, 'This is really the end of the 
world.'

Perhaps it is. Although real (inflation-adjusted) fuel prices are still 
well below their 1981 maximum, a large and ever-growing chorus of 
voices, ranging from former British environment minister Michael Meacher 
to National Geographic magazine, are shouting from the rooftops that the 
age of cheap oil is ending. Even if the current oil prices rises are 
slowed or reversed by higher Opec outputs, we will soon arrive - 
petroleum pundits claim - at the genuine summit of 'Hubbert's peak'.

M King Hubbert was a celebrated oil geologist who in 1956 correctly 
prophesied that US petroleum production would peak in the early 1970s, 
then irreversibly decline. In 1974 he likewise predicted that world 
oilfields would achieve their maximum output in 2000 - a figure later 
revised by his acolytes to 2006-10.

If the curve of global oil production is indeed near the point of 
descent, as these experts believe, it has epochal implications for the 
world economy. More expensive oil will undercut China's energy-intensive 
boom, return OECD countries to the bad old days of stagflation, and 
accelerate the environmentally destructive exploitation of low-grade oil 
tars and shales.

Most of all, it will devastate the economies of oil-importing Third 
World countries. Poor farmers will be unable to afford artificial 
fertilisers, just as poor urban-dwellers will be unable to afford bus 
fares. (Already rising oil prices have brought chronic blackouts to 
cities throughout the South.) The only certain beneficiaries of this 
coming economic chaos will be the big five oil corporations and their 
corrupt partners - the Nigerian generals, Saudi princes, Russian 
kleptocrats and their ilk. Crude oil truly will become black gold.

The rising value of an increasingly scarce resource is a form of 
monopoly rent, and a permanent regime of $50 per barrel (or higher) 
crude would transfer at least $1 trillion per decade from final 
consumers to oil producers. In plain English, this would be the greatest 
robbery by a rentier elite in world history.

The oilmen in the White House, of course, have the best view of the 
terrain on the far side of Hubbert's peak. No wonder, then, that a map 
of the 'war on terror' corresponds with such uncanny accuracy to the 
geography of oilfields and proposed pipelines. From Kazakhstan to 
Ecuador, American combat boots are sticky with oil.

To cite two examples; first, the Malaysian foreign minister warned in 
May that Washington was exaggerating the threat of terrorist piracy in 
order to justify the deployment of forces in the Straits of Malacca - 
the chokepoint of East Asia's oil supply.

Secondly, Christian Miller, reporting in the Los Angeles Times, revealed 
that US Special Forces, as well as the CIA and private American security 
contractors, are integrally involved in the ongoing reign of terror in 
Colombia's Arauca province. The aim of 'Operation Red Moon' is to 
annihilate the left wing ELN guerrillas threatening the oilfields and 
pipelines operated by LA-based Occidental Petroleum. The result, Miller 
reports, has been a slow-motion massacre:

'Mass arrests of politicians and union leaders have become common. 
Refugees fleeing combat have streamed into local cities. And killings 
have soared as right wing paramilitaries have targeted left wing critics.'

Latin America (Mexico, Venezuela, Colombia and Ecuador) supplies more 
oil to the US than the Middle East and, from the very beginning, the 
White House has defined the 'war on terror' as including 
counter-insurgency in the western hemisphere.

Is there a pattern here? Indeed, is there a US masterplan for the 
control of oil in an age of diminishing supply and soaring prices? 
Obvious questions, but don't ask a Democrat.

Although many ordinary Americans have little difficulty connecting the 
dots (to use a currently popular expression) linking blood to oil, the 
Democrats, with few exceptions, refuse to ask any deep or probing 
questions about the economic architecture of the New American Empire. 
Thus John Kerry has waffled back and forth between advocating an energy 
version of Fortress America (via the integration of Canadian and Mexican 
oil resources) and complaints that the Bush administration hasn't put 
enough pressure on Opec, especially Saudi Arabia, to expand production.

One of the richest members of the Senate in history, Kerry seems 
congenitally allergic to the kind of anti-corporate populism and bold 
muck-raking that has made Michael Moore an international anti-Bush icon. 
Indeed, Kerry so far has refused every opportunity to publicly 
interrogate the economic interests driving Bush's foreign policy, or to 
address public concern about the future of our oil-addicted, SUV-heavy 
society.

As a result, the presidential campaign has the dismal appearance of a 
Republican primary, with Kerry running as Bush Lite. As the senator from 
Massachusetts constantly emphasises, a vote for him will ensure the 
bipartisan continuity of the 'war on terror', the Patriot Act, US 
support for Likud, the isolation of Cuba and Venezuela, and the military 
occupations of Iraq and Afghanistan.

At this point, only the Nader campaign genuinely offers political space 
to demand the US out of Iraq and to contest Washington's broader 
interventionist agenda. Only Nader is likely to press the attack on the 
corporate puppeteers of both political parties.

At the same time, it would be utopian to expect Nader - an old-fashioned 
progressive who has just won the endorsement of the former Perot voters 
and Jesse Ventura supporters in the Reform Party - to offer a coherent 
critique of the brave new world being fashioned in the twilight of cheap 
oil. That's a job description for socialists.
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