Starving the People To Feed the Cars
High oil prices are much more than just a drain on drivers' pocketbooks or a sign of tough economic times ahead; they could also prove to be a leading indicator of the unraveling of our global civilization.
That may sound unlikely, or melodramatic. But consider this: Now, almost everything we eat can be converted into automotive fuel. And once the price of oil surpassed $60 a barrel last year, the business of transforming wheat, corn, soybeans and sugarcane into fuel for cars instead of food for people became hugely profitable. As crops that have long sustained us are diverted to provide fuel, we may encounter the same fate that brought down great civilizations of the past.
Plans for new ethanol distilleries and biodiesel refineries are announced almost daily, setting the stage for an epic competition. In a narrow sense, it is one between the world's supermarkets and its service stations. More broadly, it is a battle between the world's 800 million automobile owners, who want to maintain their mobility, and the world's 2 billion poorest people, who simply want to survive.
Whenever the food value of a crop drops below its fuel value, the market will convert it into fuel. Ultimately, this dynamic risks driving up world food prices, destabilizing governments in low-income nations and disrupting global economic growth.
Ours is not the first society to face a predicament of this kind. In his book "Collapse: How Societies Choose to Fail or Succeed," Jared Diamond assesses our current civilization against the backdrop of earlier ones, some of which recognized only too late how their future depended on safeguarding their basic resources.
Take the Sumerian civilization of the fourth millennium BC, which was based on an ingeniously engineered irrigation system -- one yielding a food surplus that supported the first cities. Some of the irrigation water percolated downward, slowly raising the water table. As the water rose, it began to evaporate, leaving a residue of salt. Over time, the accumulating salt lowered wheat yields, and the Sumerians turned to barley, a more salt-tolerant crop. But eventually the yields of barley also fell, bringing down this once-great civilization.
The New World counterpart to Sumer was the Mayan civilization in the lowlands of southern Mexico and Guatemala, a society that flourished from AD 250 until around AD 900. But deforestation and the resulting soil erosion undermined their agriculture. Today this region is covered in jungle, reclaimed by nature, and the Mayan civilization is a mere archaeological curiosity.
Some early societies recognized environmental trouble and fashioned an effective response. In the 15th century, Icelanders realized that overgrazing of their grasslands was leading to soil erosion. Farmers then calculated how many sheep the land could sustain and allocated quotas among themselves, thus preserving their grasslands -- and a wool industry that thrives today.
What salt levels, deforestation and soil erosion foretold for past societies, high oil prices could reveal about our own.
Among the many environmental threats to our future -- increasing CO2levels, melting ice sheets, rising sea levels, falling water tables and shrinking forests -- the depletion of oil reserves may be the most immediate for our oil-based global civilization.
The price of oil has more than tripled over the past four years, jumping from $20 to nearly $70 a barrel. Mainstream analysts talk about prices rising to $100 a barrel or more if major disruptions in supply occur -- such as the explosion of violence and chaos in the oil-rich Middle East. And even though the discovery of oil reserves last week beneath the Gulf of Mexico was hailed as a boost for the U.S. oil industry, it will only temporarily delay the ongoing depletion. The real news is that so few such discoveries are made.
These runaway oil prices are now driving biofuel production, once spurred mainly by government subsidies. Brazil, the world's largest exporter of sugar, converts half of its crop into ethanol for cars, contributing to a doubling of the world sugar price over the past two years. In Europe, where rapeseed is grown for both biodiesel and cooking, margarine manufacturers have asked the European Parliament for protection from the heavily subsidized biodiesel refineries.