When Will The Gasoline Panic Return?

Here's a 'tog I snapped in Pacific Palisades last year, when the phrase "Peak Oil" was just beginning to break into the consciousness of Joe Sixpack and his sister Tammy Sixpack (from the Hittite, Zhichspoq, meaning "dumb-ass").

Then came demand destruction, a crucial phrase which refers to the drop in the number of available paying customers for a given commodity, brought about by the lag time between the sharp price increase for that commodity, and the ability of would-be customers to get enough money to pay the higher price. Without dollars to spend, people who need goods are merely the needy, not customers; their presence in the market is either an invisible specter, or a riot -- but not "demand." When gas costs $4.83, less of it sells and there is less money to be made selling it. The trick for the petroleum business is to manage the price within the constraints of (1) real demand, (2) geopolitics, and (3) geology. That last one trumps the other two, and the most striking thing about the current moment is that oil scarcity seems to be a non-issue for the moment. Haven't heard a thing about it in a dog's age.

As my dear friend Mike Ruppert says (and he attributes the remark to someone else, and so on -- it's like saying, "My Uncle Budy [rhymes with "goody"] says do unto others as you would have them do unto you." Everyone says that unto everyone's nephew):

"Until you change
the way money works,
you change nothing..."

So... here we are, in a fragmenting civilization which obliges each of us to live his or her life along multiple parallel tracks: on one track is the old self, with its dreams of artistic achievement, fantasies of financial liberation, civic pride, all manner of cultural ambitions and so on; in short, the radiant embodiment of all the grown-up gendered images of solid selfhood ever tendered unto little Person McPerson. On the other track, there's your inner adult, nursing a growing awareness that none of those dreams is really possible anymore, because the collapse will make them utterly irrelevant to your shrinking circle of urgent concerns. You don't have to read the great Joseph Tainter (the very good Jared Diamond will do fine) to know that a civilization descends into a Dark Age when the diminishing returns of social complexity come up against the failure of natural systems. As scarcity of "resources" becomes excruciating, the division of labor begins to break down until nobody is left doing a specialized niche job like goldsmith or violist, lighting designer or chandelier cleaner. Everyone is just another sod-busting humpbacked dirt-farmer, trying to eke out subsistence from nature on the mung-bean farm without getting cholera and farting one's spleen straight into the compost heap. Perhaps that was a bit vivid.

Since the economy is now contracting, fuel is cheap. The same contraction means nobody can afford it. At some point, however, demand destruction will no longer be enough to depress the gas price; the supply will keep shrinking, exceeding the ability of each successive demand group to meet the new price. It seems to me, we will probably return to $4/gallon long before any commercial recovery puts that kind of money in the pockets of Us the People. Whatever happens with the horserace among financial collapse, climate change, and Peak Oil, the result will be a de-monetized real economy of local food, community gardening, handicrafts, barter, a-smokin' an' a-drinkin', street theater, bad dentistry, looting, riot control, semi-futile rebellion against The (F.E.M.A.) Man, and reading Whitman by the side of the lake while Ma and Pa Zhichspoq sip a jug of ripple by Old Man Keester's frog pond in the June dawn breeze.

Any questions?