Volatility

July 8, 2009

Globalism to Relocalism

I want to offer a few thoughts on globalization, and why opposition to it is linked to relocalization.
 
The European Union has just decided to impose a tariff for the next five years on American biodiesel imports. This is in retaliation for massive American subsidies to this pseudo-industry, which in turn enable biodiesel exporters to dump their product in Europe below cost, hammering European producers. The targeted companies include Archer Daniels Midland and Cargill. The usual suspects.
 
This is of course a mere squabble among gangsters. The Europeans are just as guilty of dumping in Africa and elsewhere (where local economies are unable to defend themselves against this aggression). We’ll no doubt hear the usual jeremiads against “protectionism”, although this is no such thing.
 
Leaving European hypocrisy aside, this is not flat earth protectionism but self-defense against what a good globalist should call an abuse of the system. (It’s not really an abuse, as I’ll explain below.)
 
(As for the omnipresent cry that protectionism will hinder the Great Recovery, we should know that this is a crock. There can be no “recovery” in their sense. Consumers are at the end of their debt rope and must either let go or be hanged. We are not going to see a restoration of the consumer orgy. We’ve seen Peak Consumerism, and we can happily bury it.
 
The banks know this, which is why they will not lend, why they only sit on the bailout money. They know, far from a consumer phoenix being ready to rise from the flames, there’s instead a lot more burndown to go: the credit card debt crash has barely begun.
 
While oil prices temporarily plummetted, they have risen again. From here they’ll likely continue to fibrillate wildly for the next several years until the true Peak Oil effect sets in, and oil becomes permanently expensive. So while shippers have had a temporary respite (if they had anything to ship) on energy prices, they know they can’t rely upon anything but price volatility.
 
Globalization’s great wave has broken and now ebbs. Anyone who is counting on that wave to roll in again to refresh the parched global economy is going to go thirsty.
 
So no one has to worry about protectionism hindering recovery. Protections will simply be a logical part of decoupling from the already-doomed globalization model.
 
We who are glad to see the end of an unsustainable civilizational model can applaud protectionism as an example of Dmitri Orlov’s doctrine of boondoggles to the rescue.)
 
Getting back to biofuels and Big Ag, the way this racket works is clear. They are the recipients of massive federal subsidies, which enable them to export and dump their product, destroying local economies and pocketing all profits.
 
If you know the movie Goodfellas you’re familiar with the part where the mob becomes a partner in a restaurant. They immediately start buying huge amounts of consumer goods like TVs on the restaurant’s credit, take delivery there, and literally bring the stuff in through the front door and out the back into the back alley, where they sell it for cash at a big discount. The place is stuck with the bill. “Nobody’s going to pay for it anyway. It’s all profit!”
 
That’s exactly the way corporatist rackets like agrofuels and industrial agriculture work under globalization. The taxpayers subsidize production, the corporations take the goods overseas and dump them. “It’s all profit”, while the taxpayers are stuck with the bill, and overseas economies are assaulted.
 
The EU’s complaint against America is 100% correct. But they are just as guilty, and often collaborate with the Americans in these crimes. Look at the example of Smithfield. The American multinational had a golden road paved for it into Eastern Europe. It promptly CAFOized the pork economies of Romania and Poland, ravaging those farm economies (and strewing various environmental and public health disasters along the way). It received huge state and EU subsidies for this, and then received further payments for exporting pork scraps to Africa, where it dumped them, largely eradicating local hog farmers there as well. European producers are guilty of the same crimes.
 
(This also illustrates how EU expansion to Eastern Europe was conceived as a colonial endeavor in the same way that Western Europe always looked at the global South.)
 
It’s clear that predatory pricing is not an abuse of globalization, but a feature. It is completely within the mainstream of its logic. Globalism’s ideologues always talked about “comparative advantage”, but what Western countries and corporations have always sought in practice is absolute advantage. The only thing the third world was ever comparatively best at was gutting all environmental and labor regulation, driving wages down to starvation levels, and deploying any level of violence necessary to keep the slaves in line.
 
As Larry Summers said, the best use for the third world is as a toxic waste dump. That’s the inherent logic of globalization.
 
Who invented and imposed globalism? Not the global South. It was the West and its self-constructed, therefore self-serving international trade structure (the World Bank, IMF, WTO – a veritable Economic One World Government). So we can assume that the standard predatory practice of America and the EU is the intended practice of globalization itself. This means subsidy, protections, dumping for its own industry, while ferociously opposing all protections, and any regulation in general, in the “toxic waste dump”.
 
Why should a Peak Oiler care very much about this if it’s true that globalization is being rolled back?
 
First, it’s a moral and philosophical imperative. Fighting back against organized crime, even where it’s in the fifth act, is worth doing for its own sake. 
 
Second, we’re not likely to have a fast crash, if that means the end of industrial civilization in a year or two. These corrections of history are going to take time to work themselves out, and in the meantime marauders are still going to do a lot of damage.
 
Third, anti-globalization is a relocalization initiative. To oppose Big Ag’s third world dumping is to help weaken its domestic stranglehold, which in turn helps domestic small farmers, which is the core priority for anyone concerned with energy descent, since America will need millions of small farmers.
 
So Europe’s biodiesel tariff, however hypocritical, is helpful. And of course, any blow to the agrofuel racket and all its wickedness is a good thing.
 
This is just one piece of the puzzle, one loose thread in the unravelling of industrialism. As more and more threads come loose, the thinner and weaker the garment. Perhaps at some point there will even be ways for the people to pull on those threads.

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