Out of control  

Posted by Big Gav in , , , ,

AP has a remarkably doomerish look at a country spinning "out of control", pushing the "great unravelling" idea.

Midwestern levees are bursting. Polar bears are adrift. Gas prices are skyrocketing. Home values are abysmal. Air fares, college tuition and health care border on unaffordable. Wars without end rage in Iraq, Afghanistan and against terrorism. Horatio Alger, twist in your grave.

The can-do, bootstrap approach embedded in the American psyche is under assault. Eroding it is a dour powerlessness that is chipping away at the country's sturdy conviction that destiny can be commanded with sheer courage and perseverance.

The sense of helplessness is even reflected in this year's presidential election. Each contender offers a sense of order — and hope. Republican John McCain promises an experienced hand in a frightening time. Democrat Barack Obama promises bright and shiny change, and his large crowds believe his exhortation, "Yes, we can."

Even so, a battered public seems discouraged by the onslaught of dispiriting things. An Associated Press-Ipsos poll says a barrel-scraping 17 percent of people surveyed believe the country is moving in the right direction. That is the lowest reading since the survey began in 2003.

An ABC News-Washington Post survey put that figure at 14 percent, tying the low in more than three decades of taking soundings on the national mood. "It is pretty scary," said Charles Truxal, 64, a retired corporate manager in Rochester, Minn. "People are thinking things are going to get better, and they haven't been. And then you go hide in your basement because tornadoes are coming through. If you think about things, you have very little power to make it change."

Recent natural disasters around the world dwarf anything afflicting the U.S. Consider that more than 69,000 people died in the China earthquake, and that 78,000 were killed and 56,000 missing from the Myanmar cyclone.

Americans need do no more than check the weather, look in their wallets or turn on the news for their daily reality check on a world gone haywire. Floods engulf Midwestern river towns. Is it global warming, the gradual degradation of a planet's weather that man seems powerless to stop or just a freakish late-spring deluge?

It hardly matters to those in the path. Just ask the people of New Orleans who survived Hurricane Katrina. They are living in a city where, 1,000 days after the storm, entire neighborhoods remain abandoned, a national embarrassment that evokes disbelief from visitors.

Food is becoming scarcer and more expensive on a worldwide scale, due to increased consumption in growing countries such as China and India and rising fuel costs. That can-do solution to energy needs — turning corn into fuel — is sapping fields of plenty once devoted to crops that people need to eat. Shortages have sparked riots. In the U.S., rice prices tripled and some stores rationed the staple.

Residents of the nation's capital and its suburbs repeatedly lose power for extended periods as mere thunderstorms rumble through. In California, leaders warn people to use less water in the unrelenting drought.

Want to get away from it all? The weak U.S. dollar makes travel abroad forbiddingly expensive. To add insult to injury, some airlines now charge to check luggage.

Want to escape on the couch? A writers' strike halted favorite TV shows for half a season. The newspaper on the table may soon be a relic of the Internet age. Just as video stores are falling by the wayside as people get their movies online or in the mail. ...

Why the vulnerability? After all, this is the 21st century, not a more primitive past when little in life was assured. Surely people know how to fix problems now.

Maybe. And maybe this is what the 21st century will be about — a great unraveling of some things long taken for granted.

AP also reports that the floods in the US mid-west will result in further food price inflation - Record corn prices mean more expensive meat, dairy. The FT has an article in a similar vein (via Cryptogon which has its usual spin on the subject).
Raging Midwest floodwaters that swallowed crops and sent corn and soybean prices soaring are about to give consumers more grief at the grocery store.

In the latest bout of food inflation, beef, pork, poultry and even eggs, cheese and milk are expected to get more expensive as livestock owners go out of business or are forced to slaughter more cattle, hogs, turkeys and chickens to cope with rocketing costs for corn-based animal feed.

The floods engulfed an estimated 2 million or more acres of corn and soybean fields in Iowa, Indiana, Illinois and other key growing states, sending world grain prices skyward on fears of a substantially smaller corn crop. The government will give a partial idea of how many corn acres were lost before the end of the month, but experts say the trickle-down effect could be more dramatic later this year, affecting everything from Thanksgiving turkeys to Christmas hams.

Rod Brenneman, president and chief executive of Seaboard Foods, a pork supplier in Sawnee Mission, Kan. that produces 4 million hogs a year, said high corn costs were already forcing producers in his industry to cut back on the number of animals they raise. “There’s definitely liquidation of livestock happening,” and that will cause meat prices to rise later this year and into 2009, said Brenneman, who is also the vice chairman of the American Meat Institute.

Brenneman’s cost for feeding a single hog has shot up $30 in the past year because of record-high prices for corn and soybeans, the main ingredients in animal feed. Passing that increase on to consumers would tack an extra 15 cents per pound onto a pork chop.

It’s a similar story for U.S. beef producers, who now spend a whopping 60-70 percent of their production costs on animal feed and are seeing that number rise daily as corn prices hover near an unprecedented $8 a bushel, up from about $4 a year ago. “This is not sustainable. The cattle industry is going to have to get smaller,” said James Herring, president and CEO of Amarillo, Tex.-based Friona Industries, which buys 20 million bushels of corn each year to feed 550,000 cattle.

Corn’s prices were already rising before the floods, driven up 80 percent over the past year as developing countries like China and India scramble for grains to feed people and livestock. U.S. production of ethanol, an alternative fuel that can be made with corn, has also pushed prices higher, prompting livestock owners to lobby Washington to roll back ethanol mandates. Before the floods, corn farmers were enjoying record profits selling the grain to feed animals and for use in cereals and as a sweetener in soda and candy. But a sharply smaller corn crop could wipe out those gains.

In Iowa, the No. 1 U.S. corn grower, floods inundated about 9 percent of corn crops, representing about 1.2 million acres — almost 1.5 percent of the country’s anticipated harvest. In Indiana, another 9 percent of corn and soybean crops were flooded, potentially costing farmers up to $840 million in lost earnings, Indiana Agriculture Director Andy Miller said.

Apparently heavy soil erosion has also occurred in the region.
Soil erosion has caused substantial damage to Iowa’s farm fields hit hard by heavy rain and flooding this spring, Iowa Secretary of Agriculture Bill Northey said after touring two areas of the state. Heavy rains this spring came when the soil was most vulnerable to erosion - when the soil has been tilled for planting, but before plants’ root systems grow to hold it in place, he said. It isn’t known yet how much damage was done to soil conservation structures, Northey said, but he expects the state Legislature will need to provide a fresh infusion of money to repair the damage.

Boston.com has a great set of images of the floods.

Grist reports that "Midwest woes a boon to fertilizer companies" in "Flood money".
The recent Midwestern floods have caused all manner of misery: Burst levies, lost homes, ruined crops, higher food prices, a gusher of agrichemicals and god know what else flowing into streams. One way to soothe the sting is to own shares in giant fertilizer companies like Potash Corp. of Saskatewan and Mosaic. These companies have seen their share prices jump over the past week.

Investors may be bidding them up because the floods represent a sales opportunity. To maximize yield on what's left of the 2008 corn crop, farmers will be scrambling to reapply fertilizer to make up for what's run off and evaporated due to soggy conditions.

How much will they be laying on? I asked John Sawyer, an Iowa State University agronomist who works with farmers as an extension agent. He said it's too early to tell, because farmers are still assessing their fields to figure out what can be salvaged. He added that in salvageable fields, farmers will likely be applying about 50 pounds of nitrogen per acre. Before planting, farmers typically 150 and 170 pounds per acre. So these reapplications will likely represent a significant income boost to the fertilizer giants -- and yet another source of nutrients to leach into streams, clear down to the Mississippi.

Grist reports that extreme weather events are likely to become more common as global warming progresses - The Weather Aboveground.
North America will continue to experience more heat waves, intense rains, increased drought, and stronger hurricanes due to the worsening effects of climate change, says a new report from the U.S. federal government. The report by the U.S. Climate Change Science Program is being billed as the first comprehensive federal review of climate change's effects on weather extremes in North America.

The gist: People who love watching Xtreme Weather shows will not be disappointed. "This report addresses one of the most frequently asked questions about global warming: what will happen to weather and climate extremes?" said Tom Karl of the National Oceanic and Atmospheric Administration. "This synthesis ... concludes that we are now witnessing and will increasingly experience more extreme weather and climate events."

And I'll close this little set of weather related articles with Crikey's Antidotes to Liberal climate quackery.
When Greg Hunt declares that the Coalition is behind an emissions trading scheme, he’s either lying or he’s totally out of touch with his colleagues.

If the latter, today’s Australian must be humiliating for him. With Hunt having done The 7.30 Report and other media overnight and this morning stressing that not only was the Coalition supporting a trading scheme but they hadn’t even decided if transport should be in or out, The Oz describes in gory details how Hunt’s colleagues want to significantly delay and weaken emissions trading.

It is clear that, regardless of the views of Malcolm Turnbull and Hunt, the Coalition has prepared a litany of reasons for it to back away from an emissions trading scheme. 2010 is too soon. We’ll send jobs offshore. Australia can’t solve climate change by itself. Petrol costs too much to include.

So to make life easier, Crikey is preparing a cut-out-and-keep guide to why the Coalition is hopelessly wrong. Next time you find yourself stuck at a party with a greenhouse denialist, or a Coalition MP pays a visit, or you find yourself on the bus next to Andrew Bolt, whip out this guide and have it ready for their specious arguments.

Australia’s emissions are tiny. We shouldn’t have an emissions trading scheme before other countries.

1. So what? An emissions trading scheme is good economics regardless of whether other countries do it. Reducing carbon emissions is not some act of generosity. Carbon is inflicting damage on our environment and our economies. Currently we are not paying the cost of that damage, and therefore distorting our investment, consumption and production decisions. We apply the principle of "polluter pays" elsewhere in the economy -- why not in relation to carbon?
2. Major trading partners like Europe and New Zealand have emissions trading schemes already.
3. Our emissions might be small in total but we are one of the highest per-capita emitters and major exporter of carbon-intense coal.

2010 is too soon. We need to wait.

1. Any further delay creates more uncertainty and sovereign risk for business and investors.
2. Because of the Coalition’s flatearther-like refusal to acknowledge global warming, we’ve already waited too long. The only scientifically credible dispute over global warming now is whether we’ll be totally stuffed in thirty years or fifty years. Every time the evidence is re-considered, the scenarios get worse. We don’t have time to wait.
3. As Michael Hitchens of the Australian Industry Greenhouse Network says, there’s no reason why the process of establishing an emissions trading scheme should take longer than the Government’s current timetable.
4. If the economy is not in prime position to absorb the transition costs of a trading scheme now, when will it be? We have low unemployment, businesses screaming for more workers and a struggle to contain inflation. If there are economic impacts, when would be a better time?

A trading scheme will cause jobs in energy-intensive industries to "leak" jobs offshore.

1. No it won’t. Building new facilities (e.g. an aluminium smelter) in non-trading countries requires massive investment, confidence in factors like political stability, and certainty that the destination country won’t impose a trading scheme or carbon tax for years.
2. It leaking does occur, moving energy-intensive facilities to other countries might yield environmental benefits, given Australia’s reliance on carbon-intense coal for electricity generation.
3. Energy-intensive industries form only a small part of the economy -- less than 5% of jobs.
4. Given the current skills shortage, other sectors would gratefully absorb any displaced workers.

Transport should not be included -- it is better to regulate greater transport efficiency than make people pay more for fuel, because they can’t control their fuel usage.

1. Price signals are nearly always more efficient -- and that means cheaper -- than regulation. Regulation is the command economy method of economic reform that doesn’t give consumers a choice about what they do but generates significant inefficiencies and higher costs for consumers and producers.
2. Regulating for higher motor vehicle fuel efficiency won’t compel people to buy more fuel-efficient vehicles in the absence of incentives to do so. Fuel efficiency is much higher in countries with higher fuel costs than in the US and Australia.
3. People can control their fuel usage if they have access to alternate means of transport. Our urban mass transit systems are already seeing significant increases in patronage. Greater investment in mass transit will provide more alternatives to car use.
4. Omitting transport, or any other energy-intensive sector, will just mean a higher cost across all other sectors. There’s no free lunch -- if the scheme is to be effective we have to pay one way or another.

But China and India aren’t doing anything.

1. We’ve benefited from 200 years of carbon production. We have a moral obligation to acknowledge this, especially when we can afford to do it.
2. The developed world accounts for 80% of carbon emissions. Our emissions trading scheme will strengthen our hand to argue that developing countries should join us in curbing carbon emissions. But waiting for China and India to do something about emissions will mean nothing will ever be done.

New technologies like geosequestration will fix everything.

1. This is pipedream stuff. Assuming a new technology would somehow actually address carbon emissions (and geosequestration definitely will not), by the time it is developed, proven and implemented across the world economy it’ll be 2030 and we may be facing nightmare climate change scenarios.
2. There's a wide range of existing renewable energy and energy efficiency technologies that can be a large part of the solution, just waiting to be deployed here in Australia, as they are now being deployed in many parts of the world. But these won’t work in the absence of price signals to use them.


One more related tidbit I forgot to include, from Kunstler, doomerish as ever :

A catastrophe for Iowa farmers will not be just a catastrophe for Midwestern Americans. In the Iowa floods, we'll see more evidence of how the problems of weird weather (climate change) combine and ramify the problems associated with Peak Oil. In this particular case they lead to an inflection point sometime around the 2008 harvest season, which will also be our time of political harvest.

These are not your daddy's or granddaddy's floods. These are 500-year floods, events not seen before non-Indian people starting living out on that stretch of the North American prairie. The vast majority of homeowners in Eastern Iowa did not have flood insurance because the likelihood of being affected above the 500-year-line was so miniscule – their insurance agents actually advised them against getting it. The personal ruin out there will be comprehensive and profound, a wet version of the 1930s Dust Bowl, with families facing total loss and perhaps migrating elsewhere in the nation because they have no home to go back to.

Iowa in 2008 will be an even slower-motion disaster than Hurricane Katrina in 2005. Beyond the troubles of 25,000 people who have lost all their material possessions is a world whose grain reserves stand at record lows. The crop losses in Iowa will aggravate what is already a pretty dire situation. So far, the US Public has experienced the world grain situation mainly in higher supermarket prices. Cheap corn is behind the magic of the American processed food industry – all those pizza pockets and juicy-juice boxes that frantic Americans resort to because they have no time between two jobs and family-chauffeur duties to actually cook (note: reheating is not cooking).

Behind that magic is an agribusiness model of farming cranked up on the steroids of cheap oil and cheap natural-gas-based fertilizer. Both of these "inputs" have recently entered the realm of the non-cheap. Oil-and-gas-based farming had already reached a crisis stage before the flood of Iowa. Diesel fuel is a dollar-a-gallon higher than gasoline. Natural gas prices have doubled over the past year, sending fertilizer prices way up. American farmers are poorly positioned to reform their practices. All that cheap fossil fuel masks a tremendous decay of skill in husbandry. The farming of the decades ahead will be a lot more complicated than just buying x-amount of "inputs" (on credit) to be dumped on a sterile soil growth medium and spread around with giant diesel-powered machines.

Like a lot of other activities in American life these days, agribusiness is unreformable along its current lines. It will take a convulsion to change it, and in that convulsion it will be dragged kicking-and-screaming into a new reality. As that occurs, the U.S. public will have to contend with more than just higher taco chip prices. We're heading into the Vale of Malthus – Thomas Robert Malthus, the British economist-philosopher who introduced the notion that eventually world population would overtake world food production capacity. Malthus has been scorned and ridiculed in recent decades, as fossil fuel-cranked farming allowed the global population to go vertical. Techno-triumphalist observers who should have known better attributed this to the "green revolution" of bio-engineering. Malthus is back now, along with his outriders: famine, pestilence, and war.

We're headed, it seems, toward a fall "crunch time," and that crunching sound will not be of cheez doodles and taco chips consumed on the sofas of America. I think we're heading into a season of hoarding. As the presidential campaign moves into its final round, Americans may be hard-up for both food and gasoline. On the oil scene, the next event on the horizon is not just higher prices but shortages. Chances are, they will occur first in the Southeast states because oil exports from Mexico and Venezuela feeding the Gulf of Mexico refineries are down more than 30 percent over 2007.

Perhaps more ominous is the discontent on the trucking scene. Truckers are going broke in droves, unable to carry on their business while getting paid $2000 for loads that cost them $3000 to deliver. In Europe last week, enraged truckers paralyzed the food distribution networks of Spain and Portugal. The passivity of U.S. truckers so far has been a striking feature of the general zombification of American life. They might continue to just crawl off one-by-one and die. But it's also possible that, at some point, they'll mount a Night-of-the-Living-Dead offensive and take their vengeance out on "the system" that has brought them to ruin. America has only about a three-day supply of food in any of its supermarkets.

The yet-more-ominous thing here is that shortages of food and oil are two fiascos that are pretty clearly predictable for the second half of the year. That's bad enough without figuring in the "unknowns" that could kick up American hardship a few more notches. The hurricane season just got underway – obscured for the moment by the bigger weather story in Iowa. The fate of the banks is a train wreck still waiting to happen. As it occurs – also heading into the high political and hurricane seasons – we could find ourselves not only a nation wet, hungry, and out-of-gas, but also completely broke. I'm sorry that Tim Russert will not be here to talk us through it all.

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