Thomas Paine

Thomas Paine
"These are the times that try men's souls. The summer soldier and the sunshine patriot will, in this crisis, shrink from the service of their country; but he that stands by it now, deserves the love and thanks of man and woman."

Tuesday, 19 October 2010

Opinon: the unchallenged global free market

Although the ratification of the Lisbon Treaty, which completed the UK’s political union with the EU, is a change which significantly disenfranchised the electorate [in as far as political parties can no longer promise to introduce measures in a considerable number of areas without the consent of the Council of Europe] our surrender to the global free market and all that it entails occurred far less obviously and has had a much greater obvious impact.

The promise of this free market is that the whole of the world’s population can share in the affluence which has been, until now, the prerogative of the West. I pointed out in my article concerning the minimum wage that the seeking out of the cheapest labour by the global corporations has left a large slice of our unskilled and semi-skilled labour force facing an extremely uncertain future – this uncertainty is bound to effect other areas of the workforce as the under developed East are increasingly able to supply relatively cheap labour in the more skilled jobs, perhaps best demonstrated recently by VC’s declared desire to open up the UK to immigrants from India.

However, disregarding the impact of these almost certain changes, the very concept of the promise of the global free market is built on a fallacy, because the increasing affluence enjoyed by the West for the last 100 years was the result of a period when there were surpluses of easily obtained oil. We have now reached, or are about to reach ‘Peak Oil‘ the point in time when the maximum rate of global petroleum extraction is reached – this rate will be followed by terminal decline. This issue is well described in this short video interview with Robert Rapier.

Without this steady supply of easily reached oil the affluence of the west cannot even be maintained, let alone be spread to the less developed areas of the globe, because oil is the only product which can provide its basis, other forms of renewable energy cannot replace oil in many important areas. What affluence remains as oil production declines can only move away from the least competitive nations towards the most competitive – and the UK does not fall into this category.

Given this reduction in oil supplies, the obvious route is to conserve what remains so that it might be used where and when it is needed most, but the global capitalism relies on moving goods throughout the world from where they can be produced most cheaply to where they can be sold at the highest price at a time when production and use need to be as close together as possible – if oil is to be conserved.

Apart from transportation, the profit motive in capitalism demands that products have only a limited life. There is little value in making a car which will last fifty years with just minor maintenance, once those who want your car have one – you go out of business. In order to maximise profit it is necessary that the vehicle becomes redundant – motor manufacturers make vehicles which become no longer economic to repair after about ten years, regularly change styles so owners feel ‘out of date’ and keep introducing new ‘must have’ gizmos so that their newest product becomes irresistible – this means that redundant old vehicles are regularly scrapped and the energy [oil] originally required in production has gone to waste.

As Jeremy Clarkson frequently points out, the energy savings offered by new cars is negative when the energy required to produce these cars is taken into account – far better to keep an older car in service. This short-term redundancy approach is taken by all manufacturers of products in order to keep profits high.

Clearly whilst we are trapped in the global free market, the UK, whose oil production is low and whose untapped reserves are difficult to extract, will be at the mercy of these rapidly changing forces. Free of this market we would be able to manage all of our resources in a regularized fashion which would give our children and our children’s children a far greater degree of security even if we were obliged to accept a lower standard of living – which will be the end result whether we take these matters into our own hands or not.

The danger of remaining in the center of the turmoil of the free market is that we will have little or no say on where we end up, we will be at the mercy of forces which are too powerful to control by any UK government.

No comments:

Post a Comment