Key: Rob’s comments are in italics, Derek’s comments in normal font.
We've argued on this show several times that the human species has been through a number of inflection points throughout history. It's fairly clear to anyone alive today that we are living through one of those inflection points. Like a wide range of, on the face of it, crazy things happening. We thought we might dedicate an episode to comment on some of these events.
Yes as I've said in the past, we're certainly running into the wall on various things. We'll run out of fossil fuels in the next few years or decade or two. It won't be a sudden thing. It will just get harder and harder to extract, more and more expensive. As that happens, the wider population will likely be at the back of the queue.
I think that also means they just put energy bills up and up?
We've already seen that happening. Anyway, that's one thing. The main topic of this podcast series is finance and in particular, we're seeing the world hovering on the edge of hyperinflation. It'll be very interesting to see how that unfolds.
Escalating Conflicts…
As people grow more frustrated with the situation, there's activation on a number of fronts, much of it unhelpful. Right now, one unavoidable issue is the two major conflicts in the world: the Ukraine versus Russia war and Israel versus an increasing number of surrounding states. This past week, the three biggest events were the beginnings of Israel's sneak attack with many booby-trapped pages, which, apart from targeting Hezbollah personnel, caused significant collateral damage to people nearby, followed by missile strikes into Lebanon on an extraordinary scale.
Then came retaliation from Iran. It seems this is yet another situation where provocation was ramped up until they acted, and then they blamed those who retaliated, which is exactly what we're seeing in the media. To clarify my position, I don't support violence on either side, but it seems particularly—
You've got to pay attention to the narrative and to the things that just are nonsensical.
Indeed. We've heard much about the Iron Dome of anti-missile defences. I heard someone describe it as a toilet paper dome. Obviously, this worked fine against 30-year-old Soviet missiles and homemade rockets.
But when faced with modern missiles that Iran clearly has, despite heavy censorship, we've seen plenty of footage where streams of missiles obviously got through. There are reports of very few casualties for the size of explosions we've seen. I'm unsure how well-targeted the missiles were. Apparently, they aimed at several air bases and the Mossad headquarters. Once again, we've heard complaints that this was in the middle of a civilian area. Of course, when the other side suffers massive civilian losses, we're told it's because Hamas or Hezbollah were hiding in civilian areas. Israel has obviously put their Mossad headquarters in the middle of a city somewhere.
It's bang in the middle of Tel Aviv, isn't it?
This is clearly, once again, a regime backed by the United States. Sooner or later, this will bring the United States into a confrontation with Russia, even if the Ukrainian conflict doesn't set that off first. It's a situation that only a few years ago would have seemed inconceivable. For decades, we've been told that the policy of mutual assured destruction, or MAD as it's quite appropriately abbreviated, was what prevented major conflict between world powers. Yet it seems that the sheer recklessness with which these military objectives are being pursued would give lie to that.
I've heard several commentators say that obviously with mutual destruction, that's effectively a stalemate. And if a stalemate is the best you'll get in a losing situation, then maybe that's why the people instigating these things are pursuing that tactic.
These events are at the forefront because they've been in the news within the last seven days, so I didn't think we could run an episode ignoring them.
I guess the question then is, what are the likely knock-on effects? Is this just something to monitor and be aware of?
It's a surreal situation because it's difficult to believe this is happening on the same planet where we're sitting here in relative peace and prosperity, even if it's been more constrained than a few years ago. I can't really imagine what it would be like living in Beirut or Gaza, seeing increasing waves of destruction day after day, losing everything I own, and witnessing people indiscriminately murdered all around me. It's also extraordinary how numb people seem to be in the face of it.
I think when it happens in other parts of the world, it's just a distant thing that's easy to ignore or say you're not political and therefore it doesn't apply to you or I don't know.
But it does apply to us. I think it's critical to the long-term survival and prosperity of the human species.
Indeed. For instance, during Vietnam, there was enormous pushback against it. There was a massive protest movement against the war in all kinds of ways.
It's more active involvement than the US though, isn't it? In terms of troops on the ground. Do you think?
As there weren't British troops on the ground, it didn't explain the strength of the opposition here. It did seem that amongst the people who weren't against the Vietnam War, at least they were prepared to enter the debate and trot out the arguments. Even if, particularly with the hindsight of viewing it from this historical perspective, the arguments seem a bit lame. Well, you know, otherwise the communists will get in and subjugate the population, then communism will spread all over Southeast Asia and that's really evil so we have to deploy it. At least people were saying that, whereas I don't get the impression that, apart from media outlets, there's really any great public debate on either side about what's happening with these things.
It certainly seems to be accelerating us towards some kind of crunch point, and people seem oblivious to the very real threat that it could tip over into a nuclear exchange. That would probably mean a life of deprivation and misery for those of us left alive at the end of it, even if there is anybody left alive, which is not a foregone conclusion.
It's certainly contributing to the inflationary pressures and to think it's towards hyperinflation on the fact that there seems to be unlimited money available to send to Israel or Ukraine or whatever. And yet we can't pay pensioners a fuel allowance over the winter. Like that tells you where the priorities are.
Exactly. So anyway, those are just the thoughts closest to the surface, given that this is the week we've just lived through.
Comments on the Climate Change Debate
Yeah, in terms of current events, I wanted to ask you about the climate change debate as well. You know, we've, this is obviously something that crops up a lot. We've got an episode coming out about energy. My stance personally is that I am pro-environment. I think we are living under a capitalist system, which is chewing up our natural ecosystem in the pursuit of short-term profits or zero long-term thinking. I don't think you can argue against things like deforestation or species collapse, particularly looking at insect populations. I also think that the climate change debate has been completely hijacked by carbon as a single issue. I don't actually think the amount of carbon in the atmosphere is that big of a deal. I think historically it's been much higher. So...
I'm mostly interested in it from a narrative perspective of like, where has the narrative been hijacked? What powerful interests are doing that?
I agree. I'll come back to what I said that regardless of the amount of pollution in the form of carbon dioxide, it's only one of many forms and it's possibly not the most extreme form. Having said that, the carbon which has been locked up underground in the form of coal and oil and natural gas suddenly being consumed and turned into carbon dioxide over the course of a couple of hundred years is obviously an unbalancing act. It's undoubtedly the case that the concentrations have gone up and that the concentrations of carbon dioxide in the atmosphere do raise the average temperature. It's beyond doubt that fairly small temperature ranges can have a disproportionate effect on weather systems. So all those are true. It's also true that increased concentrations in the air cause an increase in concentrations in seawater and therefore—
Yeah, because the ocean is the biggest sink of carbon, isn't it? And it trails temperatures, like the temperature has to change and then there's a reaction in the atmospheric contents of carbon about 800 years later or so.
Yeah, whatever the effect is on the climate, there is also the direct effect it's having in killing off coral reefs at a great rate, which has a knock-on effect because that's an important part of the entire marine ecosystem.
It's a complex ecosystem. And when you destroy complex ecosystems, you can't just regenerate them. It's like when you chop down a forest.
The concentration is going up. It's undoubtedly the case that the combustion of fossil fuels is putting a greater amount of carbon dioxide into the atmosphere. We've had a very significant proportion of the world's forests felled over the last few decades, which is also pushing the situation out of equilibrium in that way. Now, having said that, it's very interesting that in the past week or so, it's come out that John Kerry, who was the minister in the US government for dealing with climate change, was revealed to have had a family private jet. I don't know whether you've seen the cross-examination of him on some Senate subcommittee where he first flatly denied ever having a private plane, and then when pushed on the point said, yes, well, my wife did have a private plane.
I would buy into it a lot more if these people were cycling to work on a push bike or something. But okay, I will do it if they do it. But until then, I think I've been strung along.
Exactly. Plainly they're not taking it seriously if nearly all of these so-called leaders think it's appropriate to fly in a private jet. And the private jet uses more in a single flight than your car does in an entire year. The same goes for every single military aeroplane. The biggest contributions to consumption are military expenditure. Every time a bomb goes off, it probably produces more carbon, not to mention the other destruction, chaos, mayhem and suffering it causes. But purely in terms of immediate waste of fossil fuel energy, it uses more than your car does in an entire year. So the population at large being lectured on the fact that they're doing all this doesn't really hold up. It's very interesting that one of the solutions was supposedly this carbon tax or carbon credits, which is ridiculous. It's like somebody cheating on their wife and then saying, well, I paid somebody else to stay celibate to make up for it.
It's nonsense. But at the same time, all that has produced is another whole lot of financial transactions without doing anything to affect the real world, which people have profited from handsomely.
Yeah, and the contentious issue in London is the ultra-low emissions scheme as well, where for the princely sum of 12 pounds per day, you can cause as much emissions as you like, because you've paid your 12 pounds to the authorities, so therefore it's okay.
Not to mention if you've got an old banger it will be classified as the one that needs to pay a surplus if you go into the low emission zone, but if you've got a new Ferrari you don't have to. It makes no sense whatsoever. Anyway, that's where we go, but as I say, I think the far bigger issue over the fossil fuel crisis is not the amount of carbon it's emitting, although as we've just indicated in this conversation, that's something we should be paying some attention to. It's the fact that we're so totally dependent on these things for the way our agricultural system works and the way our food distribution system works. If there was no diesel fuel available, there'd be no delivery to the supermarkets and they'd be out of stock in two or three days. These are the things we should be paying attention to. If we start having serious power outages on the electrical grid, many people will have no means of keeping their dwellings at a comfortable temperature, no means of cooking. So, interesting times.
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