The fog of chatter about Federal Reserve money-printing shenanigans, currency wars, fiscal intransigence, exchange rates, and alphabetized rescue operations conceals the central reality of the historical moment: that all industrial economies now face epic contraction, even rip-roaring China in its absurd and spectacular bid to become the latest drive-in utopia. The so-called advanced nations of the world are all sliding toward something less than they wish to be, and the so-called developing nations will backslide further into poverty and anarchy where development will never happen.

     The implacable contraction underway is the simple result of growing scarcity of cheap oil, the master resource. Thus, in a world where fantasy has replaced analysis, the propaganda channels brim with false news of America’s coming “energy independence” and the rebirth of domestic manufacturing, the coming electric car fleet, and space tourism. There is also chatter among the paranoid that an imagined elite has deliberately engineered American collapse for fun and profit, with sideshows about the Department of Homeland Security promoting social upheaval in order to make a show of putting it down. This is all bullshit concealing the futile machinations of people so unfortunate as to hold political office in an unraveling they can’t control. Where control is no longer possible, paranoid fantasies fill the vacuum of wishing for control.

     One thing you can be sure of: the current sociopolitical weather will change. A front will blow through and sweep the fog away. So many circles of hazard are spinning around events that some fast-turning object will come off its axis and start smashing all the fantasies. When that happens, it will be every community for itself, and where there are no real communities — for instance, the vast matrix of suburban noplaces that America emergently composed itself out of in a tragic quest to become its own televised fantasy — we’ll discover the dark side of the “liberty” that so-called conservatives endlessly invoke, in all its screaming eagle iconography.

    Not since the Civil War (1861 – 65) has anything bad of this scale happened within the United States itself and the public is unprepared despite our total immersion in the on-screen ersatz heroics of avatars such as Dwayne Johnson. The terrible convulsion of the 1860s was preceded by a political time much like ours is now, with figures (calling them leaders is inaccurate) of no conviction backpedaling furiously toward strife.

     Remember these things if you tune in to watch President Obama move his lips on Tuesday amid the incessant applause in the House chamber. He’ll speak the words “climate change” and the hall will rock with thunderous handclapping — but it won’t mean anything because both the president and the people have no intention of changing the way we live. Mr. Obama will cheerlead for economic growth and he will be talking out of his ass. It’s the nature of this contraction that economic growth is absent. You can have plenty of economic activity — especially if you re-form (literally) the systems we depend on, such as farming, commerce, medicine, and transportation — but it won’t be expressed favorably in the GDP stats or the balance sheets of CitiGroup and Morgan Stanley.

     At the core of this contraction is the disappearing act of real capital — that is, accumulated wealth — for the excellent reason that we are squandering what remains of it in the futile effort to keep living the way we do. But it will be vanishing fast, contrary to the view of such fantasists as David Leonhardt, Washington bureau chief of The New York Times — catch him on the current Slate Political Gabfest — who thinks that the Growth Fairy is about to land on the south lawn of the White House.

     The State of the Union Address is happening in a peculiar quiet moment when all the financial brushfires of the time have been reduced temporarily to a smolder that conceals the full involvement of the roots under the surface. Our economic system is burning down. Nobody wants to talk about the system that will have to replace it, which I call a world made by hand.

     The fortunate few will be those who have already established themselves in an authentic community of helping hands, who have some tools — and I don’t mean Adobe Photoshop or the latest iPhone app — and laid in some bits of silver and gold.

10 Comments on "Kunstler: State of the Union"

Arthur on Mon, 11th Feb 2013 10:54 pm 



“The fortunate few will be those who have already established themselves in an authentic community of helping hands, who have some tools — and I don’t mean Adobe Photoshop or the latest iPhone app — and laid in some bits of silver and gold.”

You are not going to like this ‘authentic community’, mr Kunstler, but you bet it is coming to America anyway, like in Greece:

https://www.youtube.com/watch?v=ZkJ_ZiX_Tek

And the Constitution is going to be the cristalization point.

rollin on Tue, 12th Feb 2013 12:05 am 



The suburbs or more correctly, the bedroom communities, were formed by government dictated zoning laws. Places where small business was not even allowed, homogeneous and repetitive like modern industrial agriculture.

I think Kunstler is well ahead of his time, the US and much of the world can amble on for a number of years, pushing the dream forward as decline becomes the norm. If it takes 20 years, that is a new generation and they grew up that way. They will barely notice and not have the same expectations as the present oldsters.

BillT on Tue, 12th Feb 2013 1:44 am 



Arthur, you talk like the EU is going to be BAU while the rest of the world crashes…lol. Look in the mirror. Europe is one step ahead of the US in the collapse department. The only one who may beat you to the finish line is Japan, and they may last longer then both the EU and the US.

Rollin, it is NOT going to take 20 years. I expect it to happen during Obama’s reign. The flock of black swans circling black out the sun these days. You hope it is another 20 years. For the earth and out grand kids, I hope it is this year. Are YOU prepared?

JHK is right on in so many areas. But telling it like it is is always unpopular when it is bad news. He is simply saying that the party is over and there will never be another. The party ended about 30 years ago, and we are in the aftermath. The ‘one more for the road’ years. But the bartender is turning out the lights and saying ‘last call, we’re closing in a few minutes.

Dmyers on Tue, 12th Feb 2013 2:11 am 



Kunstler hits the bull’s eye on “the disappearing act of real capital.” It has not only disappeared for now but into the future for as far as the eye can see. We squandered our inheritance. We squandered the future. We’re all squandered out, and it ain’t gonna grow no more.

If that doesn’t describe our current economic situation, then I offer it as title to a country music song.

Arthur on Tue, 12th Feb 2013 10:05 am 



Bill, no idea what a BAU is, but nowhere did I suggest that the EU is going to be exempt from severe permanent contraction. But you are wrong if you think that the EU will initiate the global crash, that is going to be the US. Greece is now contained by northern Europe. Germany posted yet another alltime export record, unemployment in most countries is low (Holland 5%, only Spain 22%, Greece basket case). Most fiscal deficits do not exceed 3-5%. Eastern Europe does not have debt at all. Russia is a huge growth market, largely to be serviced by the EU in exchange for energy. Average EU state debt 85%, lower than the US (105%) and certainly lower than Japan (200%). By and large European parameters are stable., including trade. But the major US weaknesses are the gigantic structural fiscal and trade deficits that can and will trigger a global dollar selloff in the very near future. Either that or a war in Iran is going to initiate a collapse of the status quo soon, just like in 2008, only worse. Obviously Europe is going to be hugely affected by it, no doubt about that. But the US will be the crater from which the ash will rain down on Europe and China and Japan. Expect Putin to smile a lot.

BillT on Tue, 12th Feb 2013 11:33 am 



Arthur, BAU is ‘business as usual’.

As for Germany keeping the EU together … dream on. I think the Germans are smarter than that. They need to get rid of that bull dyke they have in charge now and make some decisions in the next few years weither to save at the cost of Germany’s future, or dump and ally with Russia and keep their strength. After all they still have something to lose.

No so for the rest of Europe. France is toast. The UK a basket case. then there are levels on down to Greece. Denmark is going to go with them when they collapse as you have nothing left to grow your economy with. Nor does the rest of Europe.

Yes, the US is in intensive care and will not survive, but the race is on to see which of the big three goes down first and takes the other two with them.

rollin on Tue, 12th Feb 2013 11:43 am 



BillT
Every “expert” has been wrong about the method and timing so far, so you have been given some devine knowledge? Guess not. It has been a great source of entertainment watching them keep readjusting the end of the world and keep beating the same old drum despite failure to see forward even a few years.
When the “oil lords” and “coal laddies” are done with us, they will transistion as quickly as possible.

Arthur on Tue, 12th Feb 2013 1:07 pm 



“When the “oil lords” and “coal laddies” are done with us, they will transistion as quickly as possible.”

Indeed. The US needs 250,000 3 MW wind turbines to power an EV fleet, the same size as the current carbon fuelled fleet + 40% of electricity replacement (40% solar + 20% hydro would do the rest).

http://deepresource.wordpress.com/2013/02/10/land-use-footprint-of-wind-energy/

We are all too late to realize that in a smooth way, but a New Deal 2.0 could make a start that would at least avoid total collapse. In 20 years time the entire West got invaded with computers and broadband internet. The challenges we are facing now are of the same order of magnitude (but bigger). I still do not accept that by the end of the century or possibly much earlier the transition will be completed in at least Europe (currently leading the pack by far, both in realized installations as well as projects under development) and the US.

Arthur on Tue, 12th Feb 2013 1:27 pm 



“As for Germany keeping the EU together … dream on. I think the Germans are smarter than that. They need to get rid of that bull dyke they have in charge now and make some decisions in the next few years weither to save at the cost of Germany’s future, or dump and ally with Russia and keep their strength. After all they still have something to lose.”

The Germans remember all too well that going alone would recreate the conditions that lead to WW1 and WW2, where France and Britain allied themselves to destroy a dominant Germany. Germany in fact is the big winner of the current situation, as their mighty industry (the best in the world by far) now has unhindered access to all European markets, at the price of a few billion euro compensation for the weaker brothers. Last week the new EU budget for the coming 7 years was accepted, in line with the wishes of northern Europe (Germany, UK, Holland and others), which for the first time was smaller than before! No way that southern Europe will draw Germany into the grave with them. In fact Italy is even financially stronger than Germany! Greece is a fruitfly (2% EU GDP), Spain is bad (banking due to miscalculations in building sector; you can buy a perfect new sea view appartment for $80k) but has low debt, the lowest in Europe (65%). The UK and Ireland are in bad shape, but that is about it. France is not that bad at all and has 3 years GDP worth of unfunded liabilities, Italy 1.5, Germany 2, Holland 5, Greece 10, US 13, Ireland 15.

http://deepresource.wordpress.com/2012/12/11/the-real-state-of-western-finances/

“Denmark is going to go with them when they collapse as you have nothing left to grow your economy with. Nor does the rest of Europe.”

Denmark is the 2nd on the global prosperity ladder and has already 50% renewables. Norway is number 1 and has 100% renewables (hydro). They both already crossed the energy Rubicon and are already in safety. Germany will be next and then Italy.

christian phillip on Thu, 14th Feb 2013 6:31 pm 



hahaha….you mean there is hope?…but kunstler never said so…suddenly i want to enjoy globalization and to hell with future generations without a future….already young people are hopeless with their bowed heads into their tweet phones even when dating…i dont care when they die as long as i dont…hahhaa…i dont even want canibalism anymore…good one though.