Another attempt to theorise what seems to be both obvious and undertheorized…. This material is very basic and possibly wrong.
As I have argued elsewhere economies require the transformation of materials and energy, together with exchange from one person to another. The more energy that is available, through technologies of energy production, the more that can be done by those with access to that energy.
Energy production can mark military security, as it allows action at a distance, rapid manufacture of complicated weaponry and so on (assuming access to the materials etc). Most States take action to ensure they have excess energy and can defend themselves, or extend their range of attack, as well as extend the influence and power of their nation’s businesses.
All energy on Earth largely originates in two sources:
as ‘Interspatial energy‘,
or as ‘Planetary Energy‘
Interspatial Energy (IE) comes primarily from the Sun as electromagnetic energies, light and heat. There are also gravitational tides from the Moon, which affect planetary weather and water movements – this is energetically important. The consequences for the Planetary system of IE is huge, but the return effects of Planetary systems on IE is, so far, negligible.
Planetary Energy can come from weather, the water cycle, winds, tides and so on, which result from interaction between the Planetary system and Interspatial Energy. Other sources of Planetary energy, include Geothermal energy, fire, the interactive properties of materials, and potential nuclear energy. I want to summarise all this with the term ‘Planetary Energy and Materials’ (PEM). PEM largely depends on the existence of IE. This is an example of the laws of thermodynamics in action. Without continual energy input from an external source, the Earth system will run down. It would not have much available energy, and there is little likelihood of life evolving into anything particularly complex (not completely zero chance, we have hope for the moons of Saturn, but little chance).
The PEM leads to Planetary Ecological Cycles (PEC), which are complex living systems in which everything interacts with everything else, sometimes directly, sometimes indirectly.
Complex systems have numerous properties in general. Some of the important ones, are
Eventually, the living system covers the planet, becoming planet wide, and we have something approximating the Gaia idea. PEC and PEM are linked. PEC depends on both PEM and IE, and can affect PEM on some occasions – as when early life changed the chemical composition of the atmosphere.
PEC provides us with coal, natural gas and oil from the long time decay and death of plants and animals. These materials are all stores of ‘Carbon’ in various forms, as that is one of the major materials of Earthly life. When burnt, or released into the atmosphere, they release stored material which forms Greenhouse gases, and effects the functioning of the PEC.
Eventually we end up with humans and human organisation. Human organisation involves technologies, relations of power, relations of kinship, relations of labour, relations of knowledge and so on (all of which we often lump together and call ‘culture‘), which make use of, and are influenced by, PEC and PEM. We will call this level the Social Economy (SE), it depends upon the workings of all ‘previous’ stages, and can influence the workings of those stages.
In ‘simpler’ economies the main energy source is human labour, powered by available food and water, and perhaps fire which primarily makes more potential food edible and safe, drives away dangerous animals, allows deliberate or accidental changes in ecology and may allow some processing of minerals (copper, bronze, iron etc), which then have unexpected consequences for human lives. The use and harnessing of animals also boosts energy availability, which affects the possible scale of agriculture, population density, warfare and so on. The more organised the labour the more energy is available. However, slave (or indentured) labour appears to have been the energy basis of many large scale societies prior to widespread use fossil fuels. People also use technology to tap the power of geography and weather with river power (water wheels) and wind power (sails and windmills). This again adds to possible production, and people work to use the technology when the power is available.
Then we get the use of fossil fuels and technology to generate steam power, mechanical motion and electricity. Finally we get nuclear energy and renewable power – all stages build on the complexities of earlier stages, and multiple paths are available, both taken and not taken – for example, many nations have not used nuclear energy. Each stage in this development comes with different forms of social and work organisation, and relationship to environment (including the capacity to damage it).
The more available energy becomes, the more people can do, the wider and more integrated their organisations can become, the quicker, longer and more voluminous trade routes can become, the more separated in space the relationships that can be built, the faster armies can move and damage be delivered, and the greater the distinction in class that becomes possible: those that own or control vs those who labour, or are controlled. With plenty of cheap energy it is possible to develop mass consumption societies, with large numbers of goods.
The State, where it exists, is part of the social economy, and often promotes and protects energy systems for the obvious reasons of building trade and production that is beneficial for it and its ruling factions, and to extend military security and aggression (often to increase easy access to raw materials and energy). The State also exists to protect unequal divisions of wealth internally. The State has tended to provide slaves, protect relations of slavery (along with other forms of property), promoted navies, wind power, river power, and subsidised coal and oil production and infrastructure, and also has often supported nuclear energy because of its costs and risks. Eventually, these subsidies and supports become familiar and invisible, and support for new energy sources (not managed or owned and controlled by the same people) can become a political issue. For example the IMF advises us that fossil fuel subsidies globally amount to US$5.2 trillion or 6.5% of global GDP. This is far more than given to renewable energy generations. The subsidies include estimations for the damage from pollution, which is both a silent subsidy, and an approval of the pollution as it is not penalized.
As proposed, initially organisation of human labour and food (energy) availability, together with a set of relationship to the environment determined what could be done and what could be produced. This is the domain in which the labour theory of value is almost correct, given the addition of cultural and religious values. Relations of power are also important in influencing value, but I shall discuss all of these factors elsewhere.
Labour is simply one form of energy generation. As economies get more complex, other forms of interconnection and energy generation are added, together with issues of supply, demand, control and power. Also it is quite clear that with easily available energy people may produce more of an item than there is a market for, and it does not really matter how much labour/energy goes into the item, it can still not bring a return on a cash/commodity market. So exchange value is not directly equivalent to labour or other energy expenditure.
One important concept for consideration of energy in the economy is ‘Energy return on energy investment’ (EREI). I prefer the phrase ‘Energy return on energy input,’ (same initials) as it avoids using financial terms with very specific meanings. This idea refers to the ratio of the amount of energy you have to input into a technical system, when compared to the amount you get out. The higher the ratio, (or the more energy is emitted per unit of energy input), then the more easily available energy there is. If the energy input is continually higher than the energy output, the system is likely to eventually grind to a halt.
EREI is also dependent on organisation, or the direction, of energy expenditure. Uncontrolled energy expenditure is not the same as energy availability, just as the directed energy expenditure in a nuclear reactor is different to the energy expended in nuclear bomb. Energy availability may also be directed towards particular social groups; aluminium factories amy get supported by higher prices for other people; those who can afford energy may get more of it, and so on. There is, inevitably, a social component, and restrictions, to energy availability.
Fossil Fuels radically changed social EREIs. Fossil Fuels have been easy to extract, relatively easy to transport and process, and emit huge amounts of easily deployable energy in return. This availability has allowed transport of food from distant locations, world trade, world empires, world war, mass manufacturing, industrialisation, mass electrical technology and mass computing. It has allowed technology to become incredibly complicated and small. All of these procedures require, and use, cheap and easily obtainable energy – they also require a large and complicated back drop of production and skills – so technology is enmeshed in complex systems. Cheap easy energy has increased the possibilities of general prosperity, especially when coupled with organised labour.
It might also be the case, that the more freely energy became available, the more extraction can shift into destructive modes, as it becomes relatively easy to destroy ecologies (especially distant ecologies), transport the extracted materials anywhere, and to protect oneself as destroyer (temporarily) through more technology and energy expenditure.
Human energy and technology use can, fairly clearly, have consequences for the PEC, and thus affect human life.
In some cases, of long residence, it can appear that human life styles are ecologically harmonious, or even determined by ecologies. In these cases, the interactive system as a whole generates an implicit knowledge of how to survive, which may not be explicitly known by anyone. Such local harmonious systems are hard to replicate or transport elsewhere. They may also only be harmonious until external forces disrupt the system, or the success of particular internal forces generates tipping points.
Finally we get into the recognition of waste and pollution which we have discussed in other posts. Briefly, ‘waste‘ is defined as the by-products of production and consumption, which can (in relatively brief time) by reprocessed by the economy or the PEC. ‘Pollution‘ is defined as the by-products of production and consumption which cannot be processed by the economy or the PEC, and which has the capacity to disrupt or poison those processes. The more destructive the extraction processes, the less able ecologies are able to process waste and that waste becomes pollution. Pollution is often distributed according to relations of power, and dumped upon poorer or less powerful people, and poorer less visible places. Pollution eventually feeds back into the complexity of the PEM and PEC and affects a society’s ability to survive – at the least it generates changes in the Social Economy.
The problem we face is that pollution is changing the PEC to such a degree that the civilisation we participate in could fall apart in many ways. This is not that unusual. Previous civilisations have destroyed their ecologies by determined accident. In our case one of the prime dangers is the pollution from fossil fuels.
The same processes which give us a huge EREI and hence cheap, plentiful energy, will cause massively turbulent weather, storms, droughts, flooding, sea water rise and so on.
These are severe problems for us. It will be hard to tackle these problems if the EREI goes down, which it seems to be, and the problems will also increase if we continue with fossil fuels to try and keep the EREI up.
Oil and gas are no longer as easy to find and extract as they were, hence the use of tar sands and fracking. Their EREI is declining. Quite a lot of people, who claim to be experts, argue that rates of discovery of new oil and gas fields has declined since the early seventies. Some consider that no new massive oil fields are likely to be discovered in the future. Desperate attempts to keep going, may mean that oil companies are becoming overburdened with debt, which they will never be able to repay from profitable discoveries. Lack of oil will affect supply chains which largely depend on it for transport. Coal is now gained by open cut and other explosive techniques which are far more destructive of the environment and poisoning of nearby people. Any increased efficiency of use of fossil fuels is likely to require a fair amount of energy expenditure to implement, and may not be economic. Renewable technologies require far more energy input for their energy output than fossil fuel energy, at least at the beginning of their lives.
So far, the amount of coal and gas fueled energy is increasing at similar rates as solar and wind, increasing emissions.
There is a further economic theory which is of use here; the Jevons Paradox. This is disputed, and not everyone accepts it. Some of the rejection seems to stem from the recognition that, if correct, it has unpleasant consequences.
The Jevons paradox is basically that “The more, available, efficient or cheaper the energy, the more it will be used.” This implies that energy efficiency can result in greater consumption of fuel, rather than less consumption, and hence greater emissions. It is also in the interests of corporations who sell energy, to boost sales of energy, rather than to have unused energy on hand, so there are a few social drivers operating here, few of which favour reduction of pollution.
One consequence of the above, is that new renewable energy may not displace fossil fuel energy. Energy use may merely go up, as new renewable energy adds to energy availability, and is accompanied by even more Fossil Fuel burning – which seems to be what we are currently observing. India and China are building huge amounts of both renewable and fossil fuel power, and organisations may cut fossil fuel use at home and encourage it elsewhere in the world, where there are fewer controls. Renewable energy technology also requires energy input, for extraction, production and transport and this has been provided by fossil fuels. This increases Greenhouse gases. If fossil fuels remain stable, then building renewables at the rate required lowers energy available to run the rest of society. Any decline of the availability of fossil fuels, (due to shortage or phase out) may also mean that we cannot build renewables with the speed and financial return required to keep civilization going.
If we succeed and the percentage of renewables relative to fossil fuel increases then the amounts of cheaply available energy will sink, and the world will head for ‘degrowth’ and disconnection, whether voluntary or involuntary.
Involuntary degrowth could be disastrous. If emissions are to be reduced that will take legislation and regulation and a likely cut in living standards and the cut back of world trade, which may be culturally hard to accept. At the moment, working to satisfy consumption urges, drives the system. It is unlikely that this can be maintained, and that requires cultural work and change to make acceptable – and we are not good at doing this deliberately.