The Age of Exterminations VIII -- How to Destroy Western Europe

US Secretary of the Treasury, Henry Morgenthau Jr., (1891-1967). He was the proposer of the "Morgenthau Plan" that would have turned post-war Germany into a purely agricultural region, exterminating tens of millions of Germans in the process. It was approved by President Roosevelt but, fortunately, it was never put into practice. 

In the book titled "The Death and Life of Germany" (1959), Eugene Davidson tells us how, after that WW2 was over, the US military authorities explicitly ordered the American servicemen in Germany, and their wives, to destroy the leftovers of their meals. They wanted to be sure no food would be left for their German maids and their starving children. It was not an isolated story. After that Germany surrendered, in 1945, the general attitude of the Allies was that the Germans had to be punished. For this purpose, they deliberately limited the supply of food to Germany. 

This attitude of the Allies predated the German defeat. In 1944, Henry Morgenthau Jr., Secretary of the Treasury of the United States, had proposed the plan that would take his name, the "Morgenthau Plan." It called for the transformation of Germany into a purely agricultural society at a medieval technology level. That would have been obtained by the complete destruction of Germany’s industrial infrastructure. A consequence of the plan would have been the death of tens of millions of Germans: a primitive agricultural economy would not have been able to sustain the German population. 

The Morgenthau Plan was initially approved by President Roosevelt, and it was even publicly diffused in the press. It was later abandoned by President Truman, but it remained a practical set of guidelines for the allied policies in Germany until 1948 and an untold number of Germans starved to death. Some people speak of at least one million victims of the famine (or even several million) during the period from 1945 to 1948. Others propose smaller numbers, but we'll never know for sure. 

As we all know, the Germans were far from being innocent in the global extermination game. In addition to the Shoah, the German government engaged in the extermination of other ethnic groups, including German citizens judged to be a burden for society. In 1942, they developed the “Generalplan Ost” (General Plan for the East) that foresaw the extermination of tens of millions of Slavs in Eastern Europe. The survivors would be used as servants and laborers for the German "master race" (Herrenvolk) who would colonize the former Slavic lands.

It is impressive for us to remember how, less than a century ago, there were Western governments happily engaged in planning exterminations involving tens of millions of Europeans. Could these dark times return? It is said that society is just three hot meals away from barbarism. We could rephrase this old saying as, "society is just one defeat away from extermination." 

Indeed, the events of the past few months saw Western Europe inflicting a terminal defeat on itself by abandoning its main source of energy: Russian oil and gas. For the time being, Russian gas keeps flowing into Europe and the lights are still on, although it cannot be said for how long. 

Yet, Europe continues planning for its own defeat, as we can read in the recently published "REpowerEU" plan. The plan is mostly greenwashing, recommending such things as hydrogen and other useless technologies. But the substance of the plan is in its calling for huge investments in new regasification facilities that will allow importing large amounts of liquefied gas from the US. The EU plans to switch to sources that will be much more expensive (and also more polluting) than Russian gas. 

If applied, the REpowerEU plan could lead Western Europe to a situation similar to what the Morgenthau Plan foresaw for Germany in 1945: deindustrialization. For this to happen, it is not necessary for Europe to go dark. It is sufficient to increase the cost of energy to such a level that European industrial products would cease to be competitive in the world market. That would generate a spiral of decline that would strangle to death the European economy. Eventually, Europe would become unable to import a sufficient amount of food for its population. Famines would necessarily follow. A new Morgenthau plan, this time Europe-wide. 

Is that possible? As usual, history does not really repeat, but it rhymes. The events of World War II are not so remote from us that we can exclude that they would be repeated in some forms -- including widespread famines and exterminations in Europe. Below, you can find an interpretation of the current situation by Michael McGarrity -- who comments on the Facebook group "The Seneca Effect." This text is reproduced with his kind permission. 

Medieval EU: Plant Oats, Raise Goats.

By Michael McGarrity 23 May 2022

How many years will it take for Russia to adapt and stabilize to a new level of sanctions? Probably not long but, in the meantime, I believe that Europe will deindustrialize as plentiful, reasonably priced, Russian energy and food now sanctioned must be substituted by some yet to be identified source. Today, the German Prime Minister was "hopeful" that in 2023 Energy Production in Senegal may be ramped up to provide additional energy for Germany. This is highly irrational. Siemens, a great German technology company that requires large quantities of energy to produce its products, is now scrambling to find new sources. 

It is likely that many countries will be buying Russian energy through third-party countries such as India. Germany may now buy Russian energy from India at greatly increased prices, it will be rebranded as Indian, not Russian energy while companies such as Siemens lose competitive advantage in the world markets due to greatly increased energy production costs. Over the long term, a general reduction in global energy supplies will harm those who have to pay the highest prices. By this winter, the EU faces significant risks of energy and food shortages. The domino effect on energy will have lag times in the EU. They are not yet evident, but they are already operating.

As European energy and food stores deplete, likely by this winter, the EU economy will become medieval. Russia is self-sufficient in terms of energy and food, but there is not a sufficient supply of energy and food in the world to replace the sanctioned Russian sources in the coming years. The die is cast. The EU is due for a minimum of two years of deindustrialization. Russian Arctic natural gas facilities can't be switched on and off like a light switch. Grain that is not planted can't be harvested. Fertilizer that doesn't exist can't fertilize crops. Some yet to be implemented substitute energy sources such as Senegal will take years to be realized. China, India, and Mexico will quickly take over markets held by great German companies like Siemens. The cake is baked for the EU in terms of rapid deindustrialization, which may be permanent.

All this is part of the delusional thinking underlying the sanctions on Russia, yet to be realized in terms of impact. The reality is that 440 Million EU Citizens are on a fast track to a dystopian Medieval life and there is no turning back due to the scale of the problem, which is related to physical, not ideological constraints. The Russian economy might be destroyed by the sanctions, but no Russian will go hungry or cold. Russia may evolve a self-sufficient standard of living similar to that of the mid-1990s, while Europe goes back to the 1400s: goat carts and bearskin clothes.

I'm no expert in Geopolitics or Finance. I'm an expert in large-scale disaster recovery testing. Nothing theoretical, all practical exercises timed to the minute of what it takes to restore systems, supply chains and such. Politicians such as the German Prime Minister, touting notions of instant natural gas production in Senegal are delusional. It's time for EU citizens to start planting oats and raising goats.

Ukraine: does history repeat itself, or just rhymes?

 

Greek Artillery in 1940, fighting the Italian invasion

I have no more information available than the average person connected to the Web, nor can I claim to be more than an armchair strategist. For these reasons, I haven't written anything about the war in Ukraine, so far. But I have studied Italian history, and I have a special fascination for the incompetence of leaders. So, I thought I could propose to you a retelling of the Greco-Italian war of 1940, one of the clearest demonstrations of incompetence that a government ever provided. Can it provide us with insight into the current situation? I leave that to you to decide.  

In the late 1930s, Benito Mussolini, the prime minister of Italy, had reached the stage in which he could not be contradicted by anyone. And not just that: he was like a child who, when he wants a toy, wants it immediately. Since Mussolini was the absolute ruler of the country, this combination of incompetence and arrogance was the perfect recipe for disaster. Which took place in multiple forms.  

In 1940, when World War II had just started, it seems that Mussolini's main concern was to show his ally, and also rival, Adolf Hitler, that Italy, too, could engage in a victorious blitzkrieg campaign. It was at this stage that the idea of attacking Greece appeared. It made some sense because Greece was a potential ally of Britain (**), and also a relatively weak target. After all, Italy had been able to subdue the Albanian Kingdom in just a few days, the year before. So, why should things be different with Greece?

The problems with this idea were several: the main one was that -- unlike Albania -- Greece had a serious army.  But Mussolini wanted the invasion at all costs, and his military staff seemed to be engaged mainly in the game of pleasing him. So, a plan was devised to use the Italian troops stationed in Albania to attack Greece. Everyone seemed to be convinced that it would be a cakewalk and that Greece would fall at the first push. So, in the Summer of 1940, Mussolini set the date for the start of the invasion in October. Nobody dared tell him that the plan implied crossing the Epirus mountains and that doing that in winter was not exactly a good idea for a blitzkrieg, German style. 

Duly, on the chosen date of October 28, 1940, the Italian infantry advanced into Greece. It was instant disaster. The Greeks were waiting, well-entrenched, supplied with weapons and ammunition by the British, and ready to fight. The list of mistakes made with this campaign is so long to be worth a whole book (which exists, it is titled "The Hollow Legions" by Mario Cervi). Let's just say that the Italian attack was carried out by insufficient troops, insufficiently equipped, insufficiently prepared, and led by incompetent generals. The Italian high command seemed to think that they were still fighting World War I. What could go wrong with running against an entrenched enemy with fixed bayonets? 

During the first weeks of the campaign, not only the Italians could not advance, bogged in the mud and the snow, but they took heavy losses, and they seriously risked being thrown back into the sea. That could be avoided only throwing everything available in terms of troops and equipment at the Greeks. The struggle lasted about six months, and even with a numerical superiority of 2 to 1, the Italians couldn't get through. It ended when the Germans intervened in the spring of 1941. At that point, the combined pressure of the German and Italian armies forced Greece to surrender. 

The cost of the Greek campaign had been enormous for Italy: more than 100,000 casualties. The Greek front had also absorbed five times more troops than on the North-African front, where they would have been badly needed -- one of the reasons for the Italian defeat in that region. It was one of those victories that one almost wishes had been defeats. 

But Italy suffered the strongest blow in terms of propaganda. Mussolini had built his reputation as an "infallible" leader (the slogan was "Mussolini is always right"). After all, up to then, he had won all the wars he had engaged Italy in. But the failure of the Greek campaign offered the Allies a chance to paint him not just as an evil dictator (which he was), but also as a bumbling idiot (which he was, too). To say nothing about the blow to the reputation of Italy as a military power. Even from the Axis side, Mussolini received plenty of flak. The Germans used the Italian blunder in Greece as an excuse for the failure of their 1941 campaign against the Soviet Union, which they attributed to the delay caused by the need of helping the distressed Italians (*). Only in Italy, the press continued to praise Mussolini's leadership and his clever strategic insights.  

So, history always teaches you lessons, often fascinating ones. In this case, we can learn that:

1. Having won the previous war doesn't mean automatically winning the following one.
2. Invincible leaders often turn out to be just lucky leaders. Until their luck runs out.
3. Aging leaders may turn into bumbling idiots. Or maybe that's what they were all along.
4. No mistake made by a leader can be so big that his followers will not praise it as evidence of superior strategic savvy.
5. A victory obtained at too high a price is worse than a defeat. 
6. Propaganda is mightier than the sword.
7. History pardons no mistakes. 

Now, does the story of the Italian attack on Greece in 1940 offer us insights into the current situation in Ukraine? Maybe, but only in part. Evaluating ongoing events by comparing them to historical ones is the fastest way to enormous mistakes. Whatever happens in the world, happens for a reason, and Tolstoy correctly said that "a king is history's slave." History made Mussolini able to make enormous mistakes only because a series of factors had converged in making these mistakes possible. Other factors led to what's happening right now in Ukraine. And history moves on anyway. 

The main reason why I told you about the Greco-Italian war is that, more than 80 years later, we can pause for a moment to consider why tens of thousands of Italian and Greek men fought against each other so hard and died in such large numbers. Thinking about how useless that ancient war was may give us some perspective on how useless the current war is. We can only hope that it will end as soon as possible. 

 

(*) The story that the Italians were responsible for the failure of the German attack on Russia in 1941 is, most likely, just a piece of propaganda. It may hold something true, though, and it opens a number of fascinating questions about leader control. Why exactly did Mussolini decide to attack Greece in winter? Just because he was completely stupid? Or was the idea somehow "planted" in his mind by a foreign agency? We'll never know that, but it is remarkable how often leaders don't just make huge mistakes, they make the kind of mistakes that play in the hands of their enemies. 

(**) Formally, in 1940, Greece was neutral. But, in international politics, form and substance are always different. When Italy invaded Albania in 1939, it sent to Greece a clear message: "you are next." In the complex mosaic of the Balkan politics, that had pushed Greece into the uncomfortable position of being surrounded by potential enemies (Bulgaria, Italy, and Turkey) and, as a consequence, to seek for closer links to its traditional ally, Britain. The British saw Greece mainly as an ally against German expansion in the Balkans and, in 1934, had created the "Balkan Entente" that implied military support in case of threats on the signatories’ territorial integrity. All that gives a certain strategic logic to the events of 1940-1941. 

Solutions that Worsen the Problem: Economic Sanctions

 

Economic Sanctions seem to be becoming more and more popular. There is no doubt that they can do a lot of damage to the targeted countries and, in some case, they are true weapons of mass destruction. But are they effective for the purposes they are supposed to have? (image from "Democracy Digest")

Economic sanctions are relatively new: and I can't find anything like that in ancient history. The oldest version known is probably the European blockade enacted by Napoleon against Britain from 1806 to 1814. It damaged more the blocking nations (Europe) than the blocked one (Britain). 

The next important blockade was enacted during World War I against the Central Empires. This one was successful, at least in terms of damaging the blocked nations. The victims of starvation caused by the sanctions are probably to be measured in millions. But whether something is a "success" depends on how you define it. You may argue that the sanctions made the survivors angry enough that they sought revenge 20 years later, with World War II. 

Another important case of economic sanctions was enacted against Italy in 1935 as a punishment for having invaded Ethiopia. In terms of economic damage, it may have been successful: the Italian economy was badly hit. But we could argue that the wrecking of the Italian Economy was more a result of the war expenses than of the sanction. In any case, it made Italians angry enough that they thought it was a good idea to declare war on Britain in 1940. It wasn't, as they soon discovered. 

These examples suggest that sanctions are an effective weapon against weak countries. Actually, they can be a true weapon of mass destruction directed against civilians. Whether they can accomplish anything useful, is another matter. If history tells us something, it is that sanctions tend to achieve results that are exactly the opposite of the intended ones, at least officially. 

And not just that. Sanctions often hurt the sanctioners as much as the sanctioned ones. So, it is hard to understand why they are so popular, especially in a world where we tend to glorify "free trade." But, right now, they are like the Colt .45 at the belt of a gunman in a Western Movie: the first thing that appears as soon as a crisis develops. There may be some logic in the idea, though. After all, sanctions are an inexpensive way to give the impression that the government is "doing something." That is what politicians are looking for. Their worst fear is being labeled as "weak," and the sanctions offer them a chance to avoid that.        

Will the current sanctions against Russia obtain anything useful? We have to see that but, so far, it seems that the rule that sanctions are a solution that worsens the problem is being confirmed. Not only the Russian public remains in favor of the "special operation" in Ukraine, but the sanctions seem to be hurting Western Europe more than Russia. But we are just at the beginning of the story, and we'll have to see what happens in the long run. 

For a historical perspective, below I discuss the case of the sanctions against Italy enacted in 1935.

Sunday, December 8, 2019

The Effect of the Sanctions: Is Italy Cracking Down Under the Strain?

Posted on "Cassadra's Legacy" in December 2019, republished with a different title and some modifications 

We can learn a lot about the effects of economic sanctions from the story of how Italy reacted to the international economic sanctions imposed on the country in 1935 by a coalition of World Powers. Above, a photo from 1935. It shows a stone slab with the engraved words, "On 18 November 1935, the world besieged Italy. Perennial infamy on those who favored and consumed this absurd crime." Most of these slabs were destroyed after the defeat of Italy in WW2, but some can still be found.

In 1935, Italy invaded Ethiopia, at that time the only remaining free African country. Why exactly that happened is a long story. Let me just say that, in part, it was a revenge for a defeat suffered long before, when an early attempt at invading Ethiopia had failed. In part, it also had to do with reacting to the financial crash of 1929: governments often tend to seek for external enemies to distract people from internal troubles. Then, in part, it was seen as a way to displease the hated British, seen as guilty of not providing for Italy the coal that the Italian economy needed. And, finally, it had to do with some nebulous dreams about rebuilding the Roman Empire. It may sound silly, today, but if you read what people wrote at that time in Italy, the idea of creating a new Roman Empire was taken seriously.

Whatever the reasons, in 1935 the Ethiopian army was overwhelmed by the modern weaponry deployed by Italy: modern guns, planes, tanks, and the like, with the added help of poison gas bombing, a military innovation for that time. The final result was that the King of Italy gained the dubious honor of taking for himself the title of "Emperor of Ethiopia" and that Italy gained "a place in the sun" in Africa, as the propaganda described the results of the campaign.

A victory, yes, but a hollow one. From the beginning, Ethiopia was only a burden to the Italian economy, and the costs of the military occupation were just too much for the already strained Italian finances. The final result was perhaps the shortest-lived empire in history: it lasted just five years, collapsing in 1941 when the Italian forces in Ethiopia were quickly defeated by a coalition of Ethiopian and allied forces.

An interesting side effect of the invasion of Ethiopia was the story of the imposition of economic sanctions on Italy by the League of the Nations. It was a half-hearted effect to stop the invasion, but the war lasted just 8 months and the sanctions were dropped just two months afterward. Their effect was nearly zero in economic and military terms but, in political terms, it was a completely different story, and the consequences reverberated for years. Here are some of these consequences:

1. The Italians were not only appalled at the sanctions, they were positively enraged, appalled, livid. According to the international laws of the time, for a state to attack another was not in itself a crime (unlike the use of chemical weapons, but that came to be known only later). So, most Italians felt that they were punished for having done something -- annexing an African country -- that the other Western Powers had done many times before without anyone complaining. The result was a burst of national pride and a strong wave of popular support for the war. That generated also a wave of personal popularity for the Italian leader, Benito Mussolini, seen as the one who was making Italy great again (some things never change in politics).

2. The sanctions soon were presented by the government's propaganda as an epic and grandiose struggle undertaken by the glorious "proletarian nation" that Italy was against a coalition of the great plutocracies of the world, Britain in particular. And, by defeating this coalition, Italy showed that it was a great power, too, on a par with the others. This idea had terrible consequences when it led the Duce, Benito Mussolini, to think that Italy could match the military capabilities of the major world powers in WW2.

3. The government propaganda in Italy also used the sanctions to magnify the importance of the Ethiopian campaign. If the Northern Plutocrats had reacted so violently against Italy, it was because they feared Italy very much. As a result, Ethiopia became a national priority, to be kept at all costs. At the start of WW2, Italy had more than 100,000 fully equipped troops there. Without the possibility of being resupplied from Italy, these troops had no chance against the British, and they were rapidly wiped out. What might have happened if they had been available in other war theaters? It is unlikely that the final outcome of WW2 would have changed, but, who knows? The battle for Egypt in 1942 could have had a different outcome if Italy had been able to field 100,000 more troops there and, maybe, take the Suez Canal.

This catalog of disasters is so impressive that we might wonder if the sanctions were not just the result of incompetence and idiocy, but of an evil machination. Could it be that the British wanted Italy to engage in an adventure that was sure to lead the country to ruin, a few years later? Of course, it is unlikely that the British had been planning exactly for what happened, but it is not impossible that they understood that the Italian military apparatus would be weakened by the task of keeping Ethiopia and that would make Italy a less dangerous adversary in case of an all-out military conflict. If the British had planned that, they truly deserved the reputation they had at the time (and that they still have) described with the name of the "Perfidious Albion."

Ukraine: a Glimpse of the New Eurasian Empire

 

      Empires are alive, they move, they grow, they feel, they die. They have a soul that sometimes can be glimpsed, as in this unbelievable scene from "Dragon Blade" (2015). A silly movie but, at some points, it has a force, a presence, -- yes, a soul -- that grips you. The encounter of two great Empires, the Roman and the Chinese, is told as if it were the meeting of two persons, who are diffident at first, then they discover that they like and respect each other. Empires are part of the human adventure, part of the human ways, of what humans are. And nowadays, perhaps, we are beginning to see the birth of something that never existed before: the first true Eurasian Empire. 

Eurasia is a gigantic landmass, the largest continent, the most populated one. So huge it is, that over thousands of years of history, it was never completely conquered and turned into a single empire. The two greatest empires of antiquity that arose on the opposite side of Eurasia, the Roman Empire and the Chinese Empire, never came directly in contact with each other.

Then, at some moment during the 2nd century BC, or maybe even earlier, the many local commercial roads that crisscrossed Eurasia became connected, forming a network that crossed the whole continent. It was the Silk Road, an offspring of the domestication of the camel, a new transportation technology that replaced the more expensive wheeled vehicles. 

Vaster than empires and more slow, the Silk Road was to bring enormous changes. The Romans and the Chinese started trading with each other. Silk moved from East to West and, gold moved from West to East. In the long run, the Romans were ruined by their passion for luxury items coming from Asia. Their gold went to China and the empire collapsed with the depletion of their gold mines in Spain. 

In time, the Europeans learned how to make silk in their lands, but the Silk Road continued to exist. During the 13th century, the Venetian merchant Marco Polo traveled all the way to China by camel, following overland routes. At about the same time, the Mongol armies swept over Eurasia from their base in the very center of the continent. Their empire was the largest ever seen in history. But they could not expand it all the way to the limits of the Eurasian continent. In the East, they were stopped by the divine wind (the Kamikaze) in Japan. In the South-West, they were stopped by the Mamluk warriors in the Middle East. In Western in Europe, the shores of the Atlantic Ocean were too far even for the nimble Mongol horsemen. 

Empires come and go. After that the Mongols were gone, it was the turn of the empire of the man of iron, Timur, also known as Tamerlane. He couldn't conquer the whole Eurasia, either. Timur was the last of the great nomadic conquerors, made obsolete by the development of gunpowder and firearms.

During the 19th century, the coal-based West European states tried more than once to expand into Eurasia. Their armies never managed to do more than march into the East-European plains, to be destroyed there. It was the destiny of Napoleon's Grande Armée in 1812, then of the Germans in two successive, ill-fated attempts. At the same time, the "Great Game" ("bolshoya igra") was being played: The land-based Russian Empire and the seafaring British Empire battled each other for the control of Eurasia, later with Britain replaced by the US. These two Empires never fought each other directly, except for a brief episode during the Crimean War (1853-1856). Neither could occupy Eurasia, and they jockeyed at the edges of the respective borders. Afghanistan was a watershed where one or the other empire tried to establish a foothold. Neither succeeded. The latest attempt by the US empire ignominiously crumbled in 2020.

While all this was happening, China remained the largest Eurasian state, sometimes conquered, sometimes conquering. At the time of admiral Zheng He, in the early 1400s, China tried for the first time to expand beyond its borders. Zheng He's fleet sailed all over the Indian Ocean, reaching Africa and establishing a Chinese influence in the area. Eventually, China abandoned its seafaring power: it remained a land-based power. 

The late 19th and the early 20th centuries were a disastrous period for China, besieged and attacked from all directions. But, with the end of World War 2, China started to rebuild its economy. By the 21st century, China was poised to become the world's #1 economic power, and that had strategic implications. At present, the Chinese seem to have decided that they don't want to challenge the U.S. maritime power directly. Instead, for the first time after the reign of Genghis Khan, the prospect of a land-based Eurasian Empire is becoming a real possibility. 

What would make the new continental empire possible is the "Belt and Road Initiative", proposed by the Chinese government. It is a "Silk Road 2.0," that would link the Eastern shores of Eurasia with Western Europe and Africa by means of high-speed trains. It includes a maritime network of lanes that follows and expands on where the old Zheng He fleet had sailed. A gigantic project on a timescale of decades, perhaps centuries. The Chinese do think long-term. 

But a transport infrastructure is not enough to create an empire: energy is needed to make it function. Up to now, the booming Chinese economy has been functioning mainly on coal, but the Chinese seem to understand that they can't continue for long with that. They are diversifying, expanding their nuclear and renewables industry, at present the largest in the world. Nevertheless, becoming independent of fossil fuels will still take decades. That is pushing China to collaborate with Russia, which can provide oil and gas for the transition phase, as well as mineral resources, food, and timber. 

What we are seeing in the world right now is a transient phase of the slow development of an integrated Eurasian Economy. The war in Ukraine is having the effect of decoupling the Central Eurasian economy from the Western economy. It may be seen as part of a strategic design to control the Eurasian resources. No matter who started the war, nor how it will end, the Russian resources that once went to Europe will soon go south, to China. Western Europe will be demoted to a coastal appendage of the Western Maritime Empire, expendable as needed. 

It is curious how Western Europe not only accepted to be cut off from the Russian resources they desperately need, but enthusiastically acted for that purpose. The Chinese may have put to work a precept from Sun Tzu that goes as, "the opportunity to beat your enemy is provided by the enemy himself." One of the (many) problems Westerners have is that they can't control their own propaganda, and, in this case, they have directed it against themselves. We cannot say whether the Chinese gave a push in that direction, or just exploited a trend. In any case, it happened.  Western Europe has locked itself out of Central Eurasia while thinking they were locking the Eurasians in. 

At present, the Chinese are working on new financial instruments to decouple the Eurasian financial system from the dominance of the US dollar, and to access the Middle Eastern and African resources directly. India has good reasons to join this effort, just as Iran and many other Asian and African countries do. With this tool, the Chinese can build a Central Asian block of enormous economic power, while Western Europe has been pushed into irrelevance. At least, that gives Europeans a chance to put into practice their idea of the "EnergieWende" -- the transition to renewable energy. So far, it was mostly smoke and mirrors, but now they'll have to work on it for real. They will find that it won't be as easy as it was proposed, especially if they have to do it while their economies are collapsing. But, after all, problems are always opportunities, at least if you can solve them. 

The war in Ukraine may die out in the coming weeks, or it may expand, but that matters little. It is just a brief flare in a story that unfolds on a timescale of decades and centuries. The Russian philosopher Alexandr Dugin has been promoting for some time the concept of "Eurasianism" as a new unifying approach to governing Eurasia. In the West, Dugin's ideas are not popular in the mainstream debate. But, if they exist, it means that there exists a current of thought that examines this subject on the basis of the concept that one day Eurasia will exist as a coordinated political entity. 

Will the Eurasian Empire be a good thing or a bad thing? We cannot say: empires are not bad and are not good. They are. And they will be. 

All the World is a Stage: How the Global Drama is Being Played Out

 

The "Commedia dell'Arte" was a form of popular theatre, often played without a script. The masked actors would improvise according to the characteristics of their "persona", their mask.

There are many ways of predicting the future, and my remote ancestors, the Etruscan Haruspices, would do it by examining the liver of a freshly killed goat. I may have inherited from them my interest in the future, although I don't usually go around killing goats. 

A gentler way of studying the future consists in considering the world as a stage. You know what the characters are, what they want, the way they usually behave. Then, when you put them on stage, they may act and create a drama even without following a script. It was the way the ancient Commedia dell'Arte worked. No script, actors would just play their part, according to their "persona." a term that in Latin means "mask" and that in our times came to be related to "personality,"

It may also work for states. They have a certain persona, a way to behave that may be predictable. About two months ago, I proposed an interpretation of the current drama patterned on an older drama: the European tragedy of World War 2. The actors, the states, were different, but their masks were very similar, and I sketched out what their behavior could have been. 

You see how things are going: the world powers are acting on stage as their masks impose them to do. In particular, the EU is playing the role that was of Italy in 1940. The lack of natural resources forces the EU to depend on foreign sources, in particular on importing natural gas from Russia -- which plays the role that was of Britain in the 1930s: that of fossil fuel exporter. In the old drama, in 1940, Italy attacked its main coal supplier, Britain, in a desperately ineffective campaign. In my earlier post, I wrote that the current situation "could easily develop into a similar outcome as in 1941, with the EU doing something completely idiotic: attacking Russia." It is happening, although only indirectly, so far. And, as things stand, the EU campaign doesn't seem to be much more effective than the old Italian campaign against Britain, although not (yet?) turning into a similar humiliating disaster. 

The new drama is just in its early stages. If it continues along the same lines as the old one, we'll see the involvement of the bigger players and the growing confrontation will lead to some kind of final catharsis. Let's just hope that, afterward, there will be someone left to ponder on what has happened.

(h/t "Art Deco") 

Monday, January 10, 2022

How to keep gasoline prices low: bomb your gas station

 

An Italian fighter plane (note the "fasci" symbols on the wings) shot down in England in November 1940, during WW2 (source). Sending obsolete biplanes with open cockpits against the modern British Spitfires is one of the most glaring examples of military incompetence in history. Among other things, this old tragedy may give us hints about the current situation in the world and, in particular, why the consumers of fossil fuels tend to bomb their suppliers. 

Not everyone in Europe has understood exactly what is happening with gas prices, yet, but the consequences could be heavy. For a brief moment, prices rose of a factor ten over what was considered as "normal." Then, prices subsided a little but still remain way higher than before. Electricity prices are directly affected by the trend and that is not only traumatic for consumers, but also for the European industry. 

So, what's happening? As usual, interpretations are flying free in the memesphere: those evil Russians, the conspiracy of the Americans, it is all a fault of those ugly Greens who don't want nuclear energy, the financial lobby conspiring against the people, etcetera.

Let me try an approach a little different. Let me compare the current situation with that of the 1930s in Europe. Back then, fossil fuels were already fundamental for the functioning of the economy, but coal was the truly critical resource: not for nothing it was called "King Coal."

The coal revolution had started to appear in Europe in the 19th century. The countries that had large coal reserves, England, Germany, and France, could start their industrial revolutions. Others were cut off from the bonanza: the lack of coal was the main cause of the decline of the Southern Mediterranean countries. The Turkish empire, the "sick man of Europe," was not really sick, it was starved of coal. 

But it was not strictly necessary to have coal mines to industrialize: it could be done by importing coal from the producing countries. Sailing ships could carry coal at low cost just about everywhere in the world, the problem was to transport it inland. Coal is bulky and heavy, the only way to do that is to have a good network of waterways. And having that depends on climate: the Southern Mediterranean countries are too dry to have it. But Northern Mediterranean countries had the network and could industrialize: it was the case of Italy. 

Italy went through its industrial revolution much later than the Northern European countries but succeeded using British coal. That, of course, meant that Italy became dependent on British coal imports. Not a problem as long as the two countries were friendly to each other. Unfortunately, as it often happens in life, money may well take the priority over friendship. 

In the early 1920s, coal production in England reached a peak and couldn't be increased any more. That, of course, led to higher prices and cuts in exports. At that time, nobody could understand how depletion affects production (not even nowadays people do). So most Italians took the reduced coal supply from Britain as a geopolitical attack. It was an evil strategy of the decadent plutocracy called the Perfidious Albion, specifically designed to harm the young and growing southern countries.  

The Italian conquest of Ethiopia was the turning point of the struggle. Britain reacted by stopping the exports of coal to Italy. That, and other international economic sanctions, pushed the Italian economy, already crippled by the cost of the war, to the brink of collapse. Given the situation, events played out as if following a prophecy written down long before. Italy had to rely more and more on German coal and that had obvious political consequences. 

The tragedy became a farce when old Italian biplanes tried to bomb Britain into submission in 1940. The campaign lasted just two months, enough for the Italian contingent to take heavy losses before it was withdrawn (*). It was not just a tactical blunder, but a strategic disaster since it gave the British and their allies an excuse to bomb Italy at will. Which they did, enthusiastically and very successfully. 

The curious thing about this disastrous campaign is how it inaugurated a tradition: bombing one's supplier of fossil fuels. Italy's bombing of Britain was just the first of a long series: in August 1941, the British attacked and bombed Iran to secure the Iranian oil wells. They were much more successful than the Italians and Iran surrendered in less than a week. In the same year, in November, the Japanese attempted the same trick by bombing the United States, their main supplier of oil. The Japanese attack on Pearl Harbor was a tactical success, but a major strategic disaster, as we all know. 

After WWII, the "Carter Doctrine" implied the strategic value of oil producers in the Middle East. One of the outcomes was the protracted bombing of Iraq from 1991, still intermittently ongoing. Other oil suppliers bombed by Western states were Libya and Syria. 

In short, the tradition of bombing one's suppliers of fuels remains alive and well. Whether it can accomplish anything better than the disastrous attempt of Italy in 1941 is debatable, to say the least. After all, it is equivalent to blasting away your neighborhood gas station in order to get the gas you need, but this is the way the human mind seems to work. 

So, on the basis of this historical tradition, let's try to build a narrative about what's going on, right now, with the gas supply to Europe. We just need to translate the roles that some countries had in the 1930s with those of today. 

Coal --> Natural Gas
Italy --> Western Europe (EU)
Britain --> Russia
Germany --> USA

The correspondence is very good: we have a consumer of fossil energy (now Western Europe, then Italy) which is militarily weak, but threatens the supplier (Now Russia, then Britain) with military action despite the obvious superiority of the latter. The weak consumer (Europe/Italy) feels that it can get away with this suicidal strategy because it has the backup of a powerful ally (Now the USA, then Germany). 

Just like Britain did in 1936 to Italy, Russia appears to have reduced the supply of gas to Europe. In both cases, the result was/is a crisis in the economy of the consumers. Just as it happened in the late 1930s, the stronger ally is coming to the rescue: in 1936, Germany started supplying coal to Italy by rail, now the US is sending cryogenic gas to Europe -- both are expensive methods of transportation but allow the supplier to access a market that would have been barren, were it not for political reason. But becoming the customers of a militarily powerful country has political costs. 

The correspondence is so good that the current situation could easily develop into a similar outcome as in 1941, with the EU doing something completely idiotic: attacking Russia, hoping for the support of the powerful US ally. (also, traditionally, attacking Russia is done in Winter: what could go wrong?). 

One conclusion of this story is that humans always tend to worsen whatever major problem they happen to face. Apart from this, perhaps there is an alternative scenario that could lead Europe away from the perspective of nuclear annihilation: maybe we can learn something from the Italian experience. 

In 1936, during the coal embargo imposed by Britain, Italy carried out an attempt to reduce its consumption of fossil fuels that went under the name of "autarchy" (Autarchia). It was based on the renewable technologies available at that time, and it involved some crazy ideas, such as making shoe soles out of cardboard and dresses out of fiberglass. But, on the whole, the idea of relying as much as possible on national and local products made plenty of sense. It didn't work, mainly because the government squandered the Italian resources in useless wars, but, who knows? Today it might work better if we don't make the same mistake. 

(*) The Italian pilots had to fight with obsolete canvas biplanes: much slower than the British Spitfires. The Italian planes were also poorly armed, without an armored cockpit (the pilots used sandbags as makeshift armor), without sufficient heating, without the right training. And, of course, poor reliability of almost every mechanical system in a cold climate. Most of the Italian losses were due to mechanical failures, while no British planes are reported to have been lost to the Italians. If the definition of "epic" involves fighting against an overwhelmingly superior enemy, then the experience of the Italian force in the Battle of Britain can surely be defined in this way: an epic disaster. But whoever had this absurd idea deserved to be hanged, and at least one of them was.    

Back to Reality: We are All Children of Oil

 

Colin Campbell, founder of the Association for the Study of Peak Oil (ASPO), speaks in Pisa in 2006. Officially, the Powers that Be (PTB) ignored the ASPO message, but it could be that they understood it all too well. That would explain many things about the current situation. For two years, we thought that all our problems were caused by a microscopic, peduncled critter. Now, we are back to reality: we are all children of oil, and we cannot survive without it.

A few days ago, I found by chance on my shelves some documents from the 2006 conference of ASPO (the association for the study of peak oil) that I and others organized in Pisa, in Tuscany. The conference had a certain global resonance: it was sponsored by the Tuscan government, hundreds of people from all over the world came to attend, and the international media commented on it. It was part of a wave of interest on peak oil and its consequences. Just as another example, see the leaflet on the right that I also found rummaging among old documents. It announces a meeting to be held in the Tuscan countryside in 2004, titled, "The Party is Over", and subtitled "How to exit from the petroleum-based economy"

Today, it looks as if these things are a hundred years old. How was it that there was an age in which you could express this kind of subversive thoughts in public and be given some space in the media? And how could we delude ourselves into thinking that we could have convinced that nebulous entity called "humanity" that we were running out of our natural resources, crude oil in the first place? Even more subversive, that we should reduce consumption and move to renewable sources before it was too late?

At the time, we didn't know exactly how much time we had before troubles were to start, but our estimates were correct in terms of orders of magnitude. In the early 2000s, Colin Campbell proposed that the peak of "conventional" oil production would come around 2012. It probably did, but the peak was masked by the production of non-conventional resources. "Shale oil" bought us another decade of growth, although at a modest rate and at a high cost. So, we had more than 20 years to prepare from when, in 1998, Colin Campbell and Jean Lahérrere had first flagged the problem with an article published on "Scientific American." But, as we should have expected, nothing serious was done.

On the contrary, the entity called "humanity" showed the maturity and wisdom of someone in the grip of convulsions and possessed by demonic forces. We have seen 20 years of a roller coaster in the desperate search for an enemy to destroy and turn the clock back, to when things were good. The enemy has been singled out as Osama, Saddam, Assad, Qaddafi, and many others, destroyed only to be replaced by the new monster of the year. 

For two years, then, the monster was not a human being, but a microscopic peduncled creature that nicely played its role of bugaboo, until it was officially vaporized by the microscopic equivalent of carpet bombing. Now, it is over, and a new, more conventional monster is advancing: the soulless Vladimir Putin. Chances are that he will not be the last monster in the demonization chain.

Every time we seemed to have destroyed our arch-enemy, it came back in another form, bigger and uglier than before. And each time, in the fight against the monster on duty, we lost something of our wisdom, our freedom, our humanity. 

We never realized that what we were fighting was not a monster, but a reflection of ourselves in the desperate search for a way to continue a way of life that some of our leaders defined as "not up for negotiations." But when you deal with Nature, everything is up for negotiations. And Nature always wins the game. 

Peak oil never reached the level of the official monster of the day, but it was worrisome enough that it deserved the standard demonization treatment. It could not be bombed and there was no vaccine against it. But we marginalized it, ridiculed it, and made it disappear from view as if we had bombed it to smithereens. Yet, it is returning, even though not mentioned, during the current crisis. 

We are 8 billion on this planet, all children of crude oil. Without crude oil and other fossil fuels, most of us simply wouldn't exist. And without crude oil, we cannot continue to exist. As a monster, peak oil is much scarier than any of the bugaboos that the mainstream media have been proposing to us. Gas and coal are in the same group.

We should have known what to expect. It was all written already in 1972 in the study titled "The Limits to Growth." To be sure, the authors never mentioned wars for resources in their discussion. But just by taking a look at the curves for the most likely scenarios, it wasn't difficult to imagine that the global collapse was not going to be a friendly party. 

With the world's economic system expected to crash at some moment during the first decades of the 21st century, we should have expected the race to grab what was left would get uglier and uglier. It is happening. 

Is it the story of a failure? Maybe, but in a strangely twisted way. Thinking about what's happening right now in the world, I have a strong impression that our leaders didn't ignore our message. Not at all. Already in 2001, it was said that George Bush Jr. had decided to invade Iraq because he had read some material produced by ASPO and was worried about peak oil. It is probably just a legend, but the so-called "Carter Doctrine" of 1980 already recognized that the US couldn't survive without the oil resources of the Middle East. Our leaders are not smarter than us, but not stupid, either. 

So, it may well be that the PTBs perfectly understand the situation and that they are maneuvering to place themselves in a position to gain from the coming (actually ongoing) collapse. After all, the game that the elites know best is putting the commoners one against the other. It is the game being played right now. Like the Russian Roulette, it is one of those games you won't necessarily survive. 

How we Became What we Despised. Turning the West into a New Soviet Union

 

For everything that happens, there is a reason for it to happen. Even for turning the former Free World into something that looks very much like the old "Evil Empire," the Soviet Union. I understand that this series of reflections will be seen as controversial, but I thought that this matter is important and fascinating enough to deserve a discussion.

It all started two years ago when we were asked to stay home for two weeks "to flatten the curve." Two years later, we are looking, bewildered, at the wreckage around us and asking ourselves: 'what the hell has happened?'

In such a short time, we found that our world had turned into something very similar to one that we used to despite. The old Soviet Union, complete with heavy-handed police, censorship of the media, criminalization of dissent, internal passports, and the state intruding on matters that, once, were thought to be part of every citizen's private decision sphere. 

Surprising, perhaps. But it is a rule of the universe that everything that happens has a reason to happen. The Soviet Union was what it was because there were reasons for it to be that. It was not an alien world populated by little green men. It was an empire similar to the Western one, just a little smaller, and it concluded its cycle a few decades before us. We can learn a lot from its story. 

Dmitri Orlov, born in Russia, was among the first who noted the parallel paths that the Western and the Soviet empire were following. His first book was titled "Reinventing Collapse" (2011). Let me propose to you an excerpt where Orlov tells us of an event he experienced in St. Petersburg in the years just after the collapse of the Union. At that time, the people who had dollars, as Orlov did, had a market power that ordinary Russians couldn't even dream of. We see here the consequences of being so rich that you don't worry about carrying small change with you. 

There was also an old woman in front of the store, selling buns from a tray. I offered her a thousand-ruble note. "Don't throw your money around!" she said. I offered to buy her entire tray. "What are the other people going to eat?" she asked. I went and stood in line for the cashier, presented my thousand-ruble note, got a pile of useless change and a receipt, presented the receipt at the counter, collected a glass of warm brown liquid, drank it, returned the glass, paid the old woman, got my sweet bun, and thanked her very much. It was a lesson in civility. 

Looks like a funny story, but it is not just that. It is a deep metaphor of how a market economy works, and also how it may NOT work. The problem is that, unless some specific conditions are met, a market economy is unstable. Money tends to end all in the hands of a few, leaving the rest with nothing. It is the law that says "the rich get richer." It has a corollary that says, "and everyone else gets poorer." 

There is only a way to avoid that a market economy leads to the rich getting everything: it is growth. If the economy grows, then the rich cannot pull money out of the market fast enough to beggar everyone else. The result is the illusion of a fair share. So, you may understand why our leaders are so fixated with growth at all costs. But don't forget that those who believe that an economy can grow forever can only be madmen or economists. 

But how do you make the economy grow? The magic word is "resources." No resources, no growth (actually, no economy, either). And if you exploit a resource faster than it can reform (it is called overexploitation), then, at some moment, the whole system will crash down. It is what happened to the Soviet Union and may well happen to us, too. But let's go in order.  

Let's go back to the story of Dmitry Orlov trying to buy a sweet bun in St. Petersburg. If the old woman had accepted Orlov's offer to buy the whole tray, the price of the buns would have skyrocketed to levels so high that nobody except him could have bought them. So, Orlov could have crashed the whole market of sweet buns of that particular place. The standard Western economic theory has that, at that moment, another old woman with another tray should have magically appeared to sell buns. Supply must always match demand: it is a postulate. But things don't work like that in the real world.

The market mechanism that matches demand and offer, the way you are taught in the Economics 101 course, can work only in conditions of relative abundance. If people have dollars, then someone will make buns for them and profit from the sales. If they only have rubles, then it may well be that nobody will bother to satisfy their demand: no profit can be made from nearly worthless rubles. 

But rubles and dollars are the same thing: pieces of paper with numbers printed on them. What makes the difference is a working -- or not working -- economy. The Russian economy after the fall of the Soviet Union wasn't working anymore: its roubles could buy little more than sweet buns and even that risked being disrupted by a rich foreigner passing by.

The problem was structural. Even before the collapse, the Soviet system couldn't produce an output large enough to sustain a free market economy. In part, it was an ideological choice, but mostly it was because it was because of the need to funnel a large fraction of production to military expenses. The Soviet Union was rich in natural resources, especially mineral ones. That was an advantage, but also a temptation for other countries to invade it. The idea of turning Russia into "the world's gas station" is recent, but it was around already long ago. And that was not just a temptation: over a couple of centuries, Russia, was invaded several times, the last time in 1941. If there ever was an "existential risk" for a country, that was it. The invading Germans had clearly stated that their plan was to exterminate some 20-30 million of Soviet citizens. 

The consequence is obvious: in order to survive, the Soviet Empire had to match the rival Western Empire in military terms. But the Soviet economy was much smaller: we can roughly estimate that it always was no more than about 40% of the US economy, alone. To match the huge Western economic and military machine, the Soviet Union needed to dedicate a large fraction of its economic output into the military system. Measuring this fraction has never been easy, but we can say that in absolute terms the Soviet military expenses nearly matched those of the US, although still remaining well below those of the NATO block. Another rough estimate is that during the cold war the Soviet Union spent about 20% of its gross domestic product on its military. Compare with the US: after WW2, military spending went gradually down from about 10% to the current value of about 2.4%. In relative terms, during the cold war, the USSR would normally spend four times more than the US for its military.

In a free-market economy, these huge military expenses would have drained the market of resources, beggaring a large fraction of the Soviet citizens. To keep the market functioning, the Soviet government had to play the role of the wise old woman in Orlov's story. It used its "five-year plans" to make sure that sweet buns for the Soviet citizens were produced, that is, the fundamental needs for life: food, shelter, clothing, fuel, and vodka.  

The five-year plans also had the purpose to limit the production of items that were considered "luxuries." For instance, the Soviet Union was a producer of caviar and, nominally, the price of caviar was low enough that most Soviet citizens could afford it. But caviar was not normally available in shops. When a batch of caviar tins appeared, people would stand in line hoping that there would remain a few cans left for when their turn came. This feature avoided that the rich could corner the caviar market, driving prices sky-high, just like Dmitry Orlov could have done with the sweet buns. It also had the effect of giving Soviet citizens the illusion that their rubles were worth something. But they understood that the ruble was a form of "funny money," not the same thing as the mighty dollar. Soviet people used to say "they pretend to pay us, and we pretend to work," and they were perfectly right. The ruble was a limited kind of money: it couldn't be always be used to buy what one wanted (just like when the Western government locked their citizens in their homes: they had money, but they couldn't use it). 

Now the pieces of the puzzle go to their places. The need for a tight control of the economy shaped the Soviet society: the media were controlled, censorship enacted, dissent criminalized, and more. Those who publicly disagreed that communism was the best possible government were considered to have psychiatric problems thanks to a subservient medical establishment. Then, they could be hospitalized, sometimes for life. (I know that it looks very much like.... you know what, but let's keep going).

Not only the Soviet system was strained to the limit, but it was also critically dependent on the availability of cheap resources. So, it was vulnerable to depletion, probably the factor that caused its collapse in the late 1980s. It is not that the Soviet Union ran out of anything, but the costs of natural resources simply became incompatible for the Soviet economy. Later on, the core of the Soviet Empire, Russia, could return to being a functioning state only because it didn't have to pay the enormous costs related to keeping an empire together.  

On the other side of the iron curtain, the relatively low military expenses and abundant natural resouces made it possible for the American citizens (most of them, at least) to enjoy an extravagant lifestyle, unthinkable elsewhere in the world. They lived in suburban houses, had two cars in every garage, could go wherever they wanted, had overseas vacations every year, could buy whatever they wanted without standing in line. The US citizens could even afford a certain degree of variety in the information they received. The state control on the media was enacted in subtle ways, giving citizens the illusion that they were not exposed to propaganda.

It was the kind of lifestyle that president Bush said was "not up for negotiation" -- except that when you deal with Nature, everything is up to negotiation.

The current problem is that the resources that made the West so rich and so powerful, mainly crude oil and other fossil fuels, are not infinite. They are being depleted, and production costs increase with depletion. And that's not the only problem: something else is choking the Western economic system: it is the enormous cost of the health care system. 

In 2018, the US spent $3.6 trillion in health costs, nearly 18% of its GDP. Today, it is probably slightly more than that. Yes, health costs in the US are nearly ten times larger than military costs. It is probably not a coincidence that troubles started to appear when these costs reached the same level, about 20%, of the military expenses for the Soviet Union. 

Someone has to pay for those costs and, as always, the task falls on the middle class which becomes poorer and poorer. On one extreme of the wealth distribution curve, former middle class citizens are losing everything and are being gradually squeezed out of the market. And here is the problem: those who have no money to spend can't buy their sweet buns. They become "non-people," aka, "deplorables." What is to be done with them? A possible solution (that I am sure some elites are contemplating), is just to let them die and cease to be a problem (it is the zombie scenario). But we are not there, yet. The elites themselves don't want the chaos that would result from starving a large fraction of the citizens. How to avoid that?

The solution is well known from ancient times: it is rationing. The Romans had already developed a system called "Annona" that distributed food to the poor. During WW2, the US had ration books, ration stamps and other forms of rationing. Food stamps were introduced at that time, and they still exist. The Soviets used a kind of funny money called "ruble." In the West, rationing seems to be a silly idea but it was done during WW2 and, if there is a serious economic crash -- as it is perfectly possible -- it can return. It must return because, without rationing, we'll have the zombie apocalypse all over simply because there is no mechanism in place to limit those who still have money from hoarding all they can, when they can. 

That explains many of the things we have seen happening: whereas the Soviet Government acted by restricting supply, the Western ones seem to find it easier to restrict demand -- it is the same thing: it means cooling the economy by reducing consumption. The lockdowns of 2020 seem to have had exactly that purpose, as argued convincingly by Fabio Vighi. Their effect was to reduce consumption, and avoid a crash of the REPO market that seemed to be imminent. 

Once you start thinking in these terms, you see how more pieces of the puzzle fall to their places. The West is moving to reorganize its economy in a more centrally controlled manner, as argued, among others, by Shoshana Zuboff. That means chocking private consumption and using the remaining resources to keep the system alive facing the twin threat of depletion and pollution, the latter also in the form of climate change.  

It is happening, we see it happening, Note that it is probable that there is no "command center" somewhere that dictated the various actions that governments took over the last two years. It was just a series of common interests among different lobbies that happened to align with each other. The financial lobby was terrified of a new financial crash, worse than that of 2008, and pushed for the control of the economy. The pharmaceutical lobby saw a chance to obtain huge profits from forcing medical treatments on everyone. And states saw their chance to gain control of their citizens at a level they couldn't have dreamed of before. The epidemic was just a trigger that led these lobbies with similar goals to act in concert. 

Lockdowns were just a temporary test. The final result was the "vaccination QR code." At present, it has been imposed as a sanitary measure, but it can be used to control all economic transactions, that is what individuals can or cannot buy. It is much better than the lines in front of shops of the old Soviet Union, so it may be used to ration essential goods before the zombies start marching. 

Does that mean that the QR code is a good thing? No, but do not forget the basic rule of the universe: for everything that happens there is a reason. Before the current crisis, the Western society had embarked on a free ride of wasteful consumption: it was good as long as it lasted. Now, it is the time of reckoning. In this sense, if the QR code were used for the good of society, it could be a fundamental instrument to avoid waste, reduce pollution, provide at least a basic supply of goods for everyone.  

But the QR can do that only if the citizens trust their government and governments trust their citizens. Here, we see the limits of the Western approach to governance. During the past decades, the Western governments couldn't do anything important without imposing it on their citizens by a shock-and-awe campaign of lies. That was the way in which governments imposed QR codes or, better said, they are trying to impose QR codes. The problem is that, over the years, the Western Governments have managed to lie to their citizens so many times that nowadays they have no credibility anymore.  

So, what's going to happen? Several scenarios are possible. The Western governments may succeed in their "sovietization" of society. That would mean a heavy crackdown on all forms of communication not directly controlled by the government and the criminalization of all dissent. The government may not necessarily need to arrive to concentration camps or to mass exterminations, but it might. In this case, after that the dust settles, we face at least a few decades of Soviet-like life. The government will use QR codes to control everything we do. If you dissent or protest, you'll risk being declared officially insane, and be subjected to mandatory psychiatric treatment in a hospital, or exiled in the Western equivalent of Siberia, or worse. Even if you are not branded as insane, you'll still be forced to submit to whatever medical treatment the pharmaceutical industry will decide is good for you. Bad, but at least you'll have something to eat and a roof under which to sleep. Don't forget that the Soviet Union survived for about 70 years and, in some periods, even prospered. 

That's not the only possible outcome. We might just sidestep the "Soviet" phase and move directly to the "post-Soviet" one. It would mean the collapse of the Western Empire, fragmenting into smaller states. That may imply severe political disturbance and civil wars are perfectly possible. The transition will be tough: it is not obvious that you'll have sweet buns for your breakfast. But after the "hot" phase, the lower governance costs of smaller state could allow them to recover and rebuild a functioning economy, at least in part, just like Russia did (but there is also the example of Ukraine). 

But history never repeats: it just rhymes. So, the Soviet system is just one of the many possible ways that a state can control the supply of goods to society. There may be other ways: after all, there was no Internet at the time of the Soviet Union. There were only the "media" which could be hijacked by the state and controlled from above: a "vertical" communication system. Instead, the Web is naturally a horizontal communication system. Controlling the Web may turn out to be difficult for states, perhaps impossible despite the unleashing of legions of those demonic creatures called "fact-checkers."  Because of the complexity and the versatility of the communication system available today, the Western society might manage to avoid the heavy top-down control that eventually led to the collapse of the Soviet Union. Just maybe.

The future is full of surprises and, who knows? It may even surprise us in a pleasant manner. We might perhaps escape the "Great Reset" and move to the "Great Awakening."

How to keep gasoline prices low: bomb your gas station

 

An Italian fighter plane (note the "fasci" symbols on the wings) shot down in England in November 1940 during the bombing campaign mounted by the Italian Air Force during WW2 (source). Sending obsolete biplanes with open cockpits against the modern British Spitfires is one of the most glaring examples of military incompetence in history. Among other things, this old tragedy may give us hints about the current situation in the world and, in particular, why the consumers of fossil fuels tend to bomb their suppliers. 

Not everyone in Europe has understood exactly what is happening with gas prices, yet, but the consequences could be heavy. For a brief moment, prices rose of a factor ten over what was considered as "normal." Then, prices subsided a little, but still remain way higher than before. Electricity prices are directly affected by the trend and that is not only traumatic for consumers, but also for the European industry. 

So, what's happening? As usual, interpretations are flying free in the memesphere: those evil Russians, the conspiracy of the Americans, it is all a fault of those ugly Greens who don't want nuclear energy, the financial lobby conspiring against the people, etcetera.

Let me try an approach a little different. Let me compare the current situation with that of the 1930s in Europe. Back then, fossil fuels were already fundamental for the functioning of the economy, but coal was the truly critical resource: not for nothing it was called "King Coal."

The coal revolution had started to appear in Europe in the 19th century. Those countries that had large coal reserves England, Germany, and France, could start their industrial revolutions. Others were cut off from the bonanza: the lack of coal was the main cause of the decline of the Southern Mediterranean countries. The Turkish empire, the "sick man of Europe," was not really sick, it was starved. Of coal. 

But it was not strictly necessary to have coal mines to industrialize: it could be done by importing coal from the producing countries. Sailing ships could carry coal at low cost just about everywhere in the world, the problem was to transport it inland. Coal is bulky and heavy, the only way to do that is to have a good network of waterways. And having that depends on climate: the Southern Mediterranean countries are too dry to have it. But Northern Mediterranean countries had the network and could industrialize: it was the case of Italy. 

Italy went through its industrial revolution much later than the Northern European countries but succeeded using British coal. That, of course, meant that Italy became dependent on British coal imports. Not a problem as long as the two countries were friendly to each other. Unfortunately, as it often happens in life, money may well take the priority over friendship. 

In the early 1920s, coal production in England reached a peak and couldn't be increased any more. That, of course, led to higher prices and cuts in exports. At that time, nobody could understand how depletion affects production (not even nowadays people do). So most Italians took the reduced coal supply from Britain as a geopolitical attack. It was an evil strategy of the decadent plutocracy called the Perfidious Albion, specifically designed to harm the young and growing southern countries.  

The Italian conquest of Ethiopia was the turning point of the struggle. Britain reacted by stopping the exports of coal to Italy. That, and other international economic sanctions, pushed the Italian economy, already crippled by the cost of the war, to the brink of collapse. Given the situation, events played out as if following a prophecy written down long before. Italy had to rely more and more on German coal and that had obvious political consequences. 

The tragedy became a farce when old Italian biplanes tried to bomb Britain into submission in 1940. The campaign lasted just two months, enough for the Italian contingent to take heavy losses before it was withdrawn (*). It was not just a tactical blunder, but a strategic disaster since it gave the British and their allies an excuse to bomb Italy at will. Which they did, enthusiastically and very successfully. 

The curious thing about this disastrous campaign is how it inaugurated a tradition: bombing one's supplier of fossil fuels. Italy's bombing of Britain was just the first of a long series: in August 1941, the British attacked and bombed Iran to secure the Iranian oil wells. They were much more successful than the Italians against Britain and Iran surrendered in less than a week. In the same year, in November, the Japanese attempted the same trick by bombing the United States, their main supplier of oil. The Japanese attack on Pearl Harbor was a tactical success, but a major strategic disaster, as we all know. 

After WWII, the "Carter Doctrine" implied the strategic value of oil producers in the Middle East. One of the outcomes was the protracted bombing of Iraq from 1991, still intermittently ongoing. Other oil suppliers bombed by Western states were Libya and Syria. 

In short, the tradition of bombing one's suppliers of fuels remains alive and well. Whether it can accomplish anything better than the disastrous attempt of Italy in 1941 is debatable, to say the least. After all, it is equivalent to blasting away your neighborhood gas station in order to get the gas you need, but this is the way the human mind seems to work. 

So, on the basis of this historical tradition, let's try to build a narrative about what's going on, right now, with the gas supply to Europe. We just need to translate the roles that some countries had in the 1930s with those of today. 

Coal --> Natural Gas
Italy --> Western Europe (EU)
Britain --> Russia
Germany --> USA

The correspondence is very good: we have a consumer of fossil energy (now Europe, then Italy) which is militarily weak, but threatens the supplier (Now Russia, then Britain) with military action despite the obvious superiority of the latter. The weak consumer (Europe/Italy) feels that it can get away with this suicidal strategy because it has the backup of a powerful ally (Now the USA, then Germany). 

Just like Britain did in 1936 to Italy, Russia appears to have reduced the supply of gas to Europe. In both cases, the result was/is a crisis in the economy of the consumers. Just as it happened in the late 1930s, the stronger ally is coming to the rescue: in 1936, Germany started supplying coal to Italy by rail, now the US is sending cryogenic gas to Europe -- both are expensive methods of transportation, but allow the supplier to access a market that would have been barren, were it not for political reason. But becoming the customers of a militarily powerful country has political costs. 

The correspondence is so good that the current situation could easily develop into a similar outcome as in 1941, with the European Union doing something completely idiotic: attacking Russia, hoping for the support of the powerful US ally. (also, traditionally, attacking Russia is done in Winter: what could go wrong?). 

One conclusion of this story is that humans always tend to worsen whatever major problem they happen to face. Apart from this, perhaps there is an alternative scenario that could lead Europe away from the perspective of nuclear annihilation: maybe we can learn something from the Italian experience. 

In 1936, during the coal embargo imposed by Britain, Italy carried out an attempt to reduce its consumption of fossil fuels that went under the name of "autarchy" (Autarchia). It was based on the renewable technologies available at that time, and it involved some crazy ideas, such as making shoe soles out of cardboard and dresses out of fiberglass. But, on the whole, the idea of relying as much as possible on national and local products made plenty of sense. It didn't work, mainly because the government squandered the Italian resources in useless wars, but, who knows? Today it might work better if we don't make the same mistake. 

(*) The Italian pilots had to fight with obsolete canvas biplanes: much slower than the British Spitfires, poorly armed, without an armored cockpit (the pilots used sandbags as makeshift armor), without sufficient heating, without the right training. And, of course, poor reliability of almost every mechanical system in a cold climate. Most of the Italian losses were due to mechanical failures, while no British planes are reported to have been lost to the Italians. If the definition of "epic" involves fighting against an overwhelming superior enemy, then the experience of the Italian force in the Battle of Britain can surely be defined in this way: an epic disaster. Whoever had this absurd idea deserved to be hanged, and at least one of them was.