For want of a nail, the shoe was lost ...

It seems we've discussed this topic here before. Didn't one of the regular keyposters ponder the "freezing point" for an industrial economy? Below some level of energy input, we may see a dramatic dropoff in industrial activity.

That was me :)

You can read that article here on TOD, though it's now closed to comments. If you want to comment, you can do so by email to me, or by way of the version on my blog.

What I said there was that it's not energy input, it's fuel affordability. When the median wage (represented by per capita GDP, since finding median wages for 200+ countries was beyond my resources) can afford over 10,000lt of petrol, we see the country is a wasteful industrial society. It's so cheap we can piss it away on making things like plastic wishbones, and the engine idling while waiting in the drivethru for our burgers. Most of the West is like this.

When they can afford 1,500lt or less, fuel is barely used by private citizens, maybe only some diesel for irrigation pumps for their rice paddies, that sort of thing. That is, we see an essentially manual economy, using hand tools and animals. That's places like Laos.

When fuel affordability is in the 1,500-10,000lt range, we see a mixed-industrial economy, where there are still a few factories making cloth and tractors, but in rural areas people tend to use animals in agriculture, and in cities there are a lot of bicycles, rickshaws and use of trains. That's places like the former Communist Bloc countries, including the much-praised Cuba.

Those are broad bands of affordability only, there's some overlap. It seems like it requires very affordable fuel for industrialisation to happen, but that once it's going the fuel affordability can drop. So for example Laotians, able to afford about 1,000lt of fuel with their income, would need a couple of decades of 10,000lt or more before they could be tooling around in SUVs and eating 150% their own bodyweight in meat each year like we do. But once that was established, fuel affordability could drop to 5,000lt for a few years and they'd still be business as usual.

Anyway, below 10,000lt affordability is when people start sweating, and 1,500lt is when they just can't keep going and have to change. The West's per capita GDP is about US$28,000. So fuel would have to be $2.80/lt ($10/60/gal) for them to really feel stress, and $18.70/lt ($72/gal) for them to be truly in the shit.

That's just going on a Western average. The Scandanavian countries, for example, sure they have expensive fuel, but they also earn more than the US or Australians. Likewise, if the US has another Depression, we can imagine that the government may start subsidising fuel use, so that overall affordability stays about the same.

Now, my theory does not say that if fuel affordability drops then we have Instant Mad Max! - Just Add Assault Rifles & Spam! What it does say is that you cannot have a wasteful industrial economy if resources aren't cheap. So when the affordability of resources drops beyond a certain range, the wasteful industrial society will end.

However, that doesn't mean Mad Max. What it does mean is a collapse to a mixed industrial economy (as happened in the former Communist bloc), or else a transition to an "ecotechnic" society, one in which our use of resources is not wasteful, and yet we still have lots of machines and modern technology.

So that's why I say it's not energy input - nowhere is it written that all our energy must come from burning fossil fuels. It's quite possible to have an industrial society which is not wasteful with resources.

Certainly this would involve building a lot of infrastructure and changing the way we do things; but already we built a lot of infrastructure and changed the way we did things once before, it was called the Industrial Revolution. It involved a lot of hard work, suffering and tumult, as revolutions do; this may or may not be inevitable, I don't know.

It all depends on how we choose to respond to this challenge. Someone mentioned Jared Diamond's book Collapse, which certainly makes for bleak thoughts. But then there's the subtitle: "how societies choose to fail or succeed." Notice the key word there: "choose". What happens to us is our choice. There's nothing inevitable about resource wars, burning stuff, or backyard gardening, or whatever you think might or should happen. Things happen because we choose for them to happen. This is at once frightening and empowering.

The UK (and much of Europe) is at around $2.30 a litre (including tax) - not that far off your $2.80 a litre. Does that mean we're getting close to the tipping point? I'm certainly not disagreeing with your post - I'm just interested to see what you think on this point.

Of course it could be that rates of tax on fuel for vehicles will be dropped as we get closer to the level of unaffordability, just prolonging the agony a little bit further...