Comment: The problem is the fire can't burn hot enough.

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The problem is the fire can't burn hot enough.

Here is someone's comment I have lifted from the

Whatever you have now, you have as a benefit of FIRE. Cars, computers, wind generator parts, solenoid operated steam valves, turbine blades... it all takes fire to produce. Someone, somewhere has to build a fire and melt the metal to make the things needed to make the things and to get the oil, or coal, or uranium needed to fuel the fires.

You and me, we're on fire. It's all about oxidation, baby. Oxidation, fast or slow, and the fuel to oxidize. That's what the economy boils (no pun intended) down to.

Fuel is essential for fire; we mine that fuel, plus most of the resources we use in our economic endeavors, all using fire in the process. No here is the most important thing you can know about mining: Each resource has a cost curve characterized by compound growth. This results from the low hanging fruit principle which describes that we take first what is easiest to acquire and leave for later what is more costly, hence less profitable; we progressively burn more fuel to get back what less fuel got us the previous year.

Here is an example: In the 1930's it took the energy equivalent of 1% of the energy in a barrel of oil to acquire that barrel. Today it takes about 11%. This cost curve show the cost doubling every 20 to 25 years. Extend the curve into the future and sometime after mid century we approach 100% so it will be impractical to produce most of the oil that is left in the ground; it will simply yield little or no benefit.

Now here is another concept to add to understanding the economy. We rank what we need in the order of the most important to us and when we have limited wealth, we do without the least important to us. Food and shelter come before higher education, advanced health care and luxuries. So I am told, when we must give up 11% or more of a barrel of oil to acquire that barrel, society can no longer afford luxuries, advanced health care and higher education. That is the point where we are which is why, on average, people can't afford college or modern medicine. Of course some people have more wealth than others, so will be able to afford more than others, but as a society luxuries, higher education, and advanced health care are on the way out. If government attempts to direct the economy to provide these things, then something more important like food or shelter will not be produced. Just look at where prices are escalating at the fastest rate, higher education and health care; price is the means by which the market tells of scarce supply.

The industrial age is terminal because of the low hanging fruit principle. Economic growth is at an end. And if you think alternative sources of energy will bail us out, reread the above quote from about fire.

Now here is another little interesting point about rates of decline. Any rate of decline produces a halving period. It the economy declines at a 5% rate, then in 14 years it is cut in half, rinse and repeat. If the rate is 3% the halving period is 23.3 years, and if the rate is 7% the halving period is 10 years. The unfolding of long term economic decline is brutal.

What do people do when they get desperate? One thing is violence against others to take what is needed. This is why the crime rate is highest where poverty is greatest. Of course it is easier to have someone else steal from your neighbor on your behalf than to do the dirty work yourself. Need health care but can't afford it; let Obama take wealth from someone else to give it to you. That way you can pretend that this is the way people are supposed to live; one for all and all for one, from each according to his ability while to each according to his need. You just ignore the morality of theft in deference to necessity, and a good indoctrination in government schools helps remove any twinge of conscience.

As the economy contracts the demands of the masses will be for more bread and circus, but no matter what the government does to manage it, will only make matters worse. We will not see freedom again until we emerge from the transition out of the industrial age many decades in the future, with a much smaller human population and much more localized government and economy. My sympathies to the younger generations; your entry into life was badly timed.

"Bend over and grab your ankles" should be etched in stone at the entrance to every government building and every government office.