The following three posts were initially published separately beginning on August 15. They are repeated here inside one bubble for your convenience. No extra charge. gah
It’s “Another Saturday Night” PT 1 and I ain’t got no money
Sing it with me now:
“Another Saturday night and I ain't got nobody
I got some money 'cause I just got paid
How I wish I had someone to talk to
I'm in awful way.”
Sam Cooke sang it right in 1963 but if he was singing his hit song today he’d likely have to change the second line to ‘I got no money though I just got paid.’
Oh, he’d be in an awful way all right.
Why? Because he’d be in debt just like most other people in Canada and the US.
Though there are more troubled waters looming, let's look at the debt issue for one more minute.
A recent article with a Canadian perspective states the following:
The financial situation in the US is bad; Washington is borrowing just to stay afloat. Sadly, the same can be said for many Canadian families. (Aug. 4, London Free Press)
[“Hug your piggy bank. Hang on tight.”]
Though the American family wasn’t mentioned, the outlook is as bleak for our neighbours to the south.
Though we think we live in the land of plenty, it isn’t a prosperous place for all families, says the article.
“Credit card and mortgage debt, combined with everyday expenses like putting food on the table, are keeping Canadians from saving for the future.”
Today is tough for many. Tomorrow will likely be tougher without savings.
Though the US is taking on “six times in debt what it makes in annual revenue” - way too much - the average Canadian, with $1.47 debt for every $1 earned, is in a very vulnerable position too.
“Once interest rates begin to climb from historic lows later this year, it could be too late for many Canadians to dig out,” says the head of online bank ING Direct Canada.
Though some recent news reports “more that half of Canadians say they are making good progress paying down their debt” (Aug. 9, London Free Press), the progress may not be enough to help them stay afloat when other troubled waters on the horizon swamp the fragile boat they have boarded by taking on a lifestyle bigger than their weekly pay cheque can afford.
[My mantra, i.e., reduce spending, pay down debt, save money for the tough times ahead, is getting timelier by the minute.]
More about troubled waters to follow.
It’s “Another Saturday Night” PT 2 and I still ain’t got no money
[“Though some recent news reports ‘more that half of Canadians say they are making good progress paying down their debt’ (Aug. 9, London Free Press), the progress may not be enough to help them stay afloat.” Aug. 15, G. Harrison]
Sing it with me:
When you're weary, feeling small
When tears are in your eyes,
I will dry them all.
I'm on your side
When times get rough
And friends just can't be found,
Like a bridge over troubled water
I will lay me down
Like a bridge over troubled water
I will lay me down. (P. Simon, 1969)
I think Paul Simon’s song will come to mind often in the near future when troubled waters on the horizon swamp the fragile boat many have boarded by taking on a lifestyle bigger than their weekly pay cheque can afford.
Journalist and author Gwynne Dyer addresses actual water woes - linked to financial problems I touched on in PT 1 - that are building up behind a weakening dam in his most recent column ‘Food supply depends on water supply’ and we should all take note.
[Please click here to link to Dyer’s article.]
Financial problems will likely sink many families soon, but water and subsequent food troubles will sink whole countries.
Dyer mentions more than water and food bubbles that will one day burst. He says, “There is the Chinese real-estate bubble, the biggest in history, which may take the whole world economy down with it when it bursts.” But then he adds, ominously, “But nothing compares with the food bubble.”
Okay, my interest was piqued.
Some highlights follow:
the average world price of grain soared by 71% in the last year
it’s a catastrophe for poor countries, not a catastrophe for some in rich countries who spend 10% or less of income on food supplies
climate change and water constraints will eventually make the situation more serious
water and food bubbles envelop and will affect everyone and their wallets and purses negatively
Some readers may be old enough to recall a food price crisis in the early 1970s and that “the problem was quickly solved by the famous Green Revolution, which hugely increased yields of rice, wheat and corn.”
And today some might be lulled into thinking that for every problem there will be a technological solution, so why worry.
There are drawbacks to that kind of thinking.
About the earlier food price crisis Dyer says, “The only drawback was that the Green Revolution wasn’t really all that green. Higher-yielding strains of familiar crops played a part in the solution, certainly, but so did a vastly increased use of fertilizer: global fertilizer use tripled between 1960 and 1975.”
Dyer perhaps assumes we know that depending on vast amounts of fertilizer is very short-sighted so goes on to his main point - future water shortages and food crises. But many don’t think about fertilizer, especially when roast beef is on sale at $2.99 per pound.
Here are a few highlights about fertilizer from ‘The Omnivore’s Dilemma by Michael Pollan:
“When humankind acquired the power to fix nitrogen (and thereby produce fertilizer), the basis of soil fertility shifted from a total reliance on the energy of the sun to a new reliance on fossil fuel.” (pg. 44)
[“I highly recommend this book”: photo GH]
“...synthetic fertilizer opens the way to monoculture, allowing the farmer to bring the factory’s economies of scale and efficiency to nature... fixing nitrogen allowed the food chain to turn from the logic of biology and embrace the logic of industry. Instead of eating exclusively from the sun, humanity now began to sip petroleum.” (pg. 45)
“When you add together the natural gas in the fertilizer to the fossil fuels it takes to make the pesticides, drive the tractors, and harvest, dry, and transport the corn (more than half of all synthetic nitrogen made today is applied to corn), you find that every bushel of industrial corn requires the equivalent of between a quarter and a third of a gallon of oil to grow it - or around fifty gallons of oil per acre of corn. (Some estimates are higher.)”
“Put another way, it takes more than a calorie of fossil fuel energy to produce a calorie of food... ecologically this is a fabulously expensive way to produce food (especially for beef @ $2.99 per pound) - but ‘ecologically’ is no longer the operative standard. As long as fossil fuel energy is so cheap and available, it makes good economic sense to produce corn (and many other foods) this way.”
Fertilizer. Fossil fuels. Food. The interconnection in modern times is guaranteed. The cheap price of food is not. As long as we rely on factory scale farms where production is driven by oil, the price of oil will determine the price of food.
Today, with the price per barrel at $86.05 (a real deal when compared to the price of $105 just a few months ago), and nations around the world scrambling to find new sources in more hard to reach places, the price of food will likely only go up.
Then there’s Dyer’s water issues.
More to follow.
It’s “Another Saturday Night” PT 3 and, that’s right, I ain’t got no money
[“Fertilizer. Fossil fuels. Food. The interconnection in modern times is guaranteed. The cheap price of food is not. As long as we rely on factory scale farms where production is driven by oil, the price of oil will determine the price of food... the price of food will likely only go up. Then there’s Dyer’s water issues.” G. Harrison, Aug. 16]
According to Gwynne Dyer, the Chinese real-estate bubble, “the biggest in history,” could take down the whole world economy when it bursts.
As well, as oil prices go so go food prices, since modern factory food production is highly dependent upon fossil fuel based fertilizers and food transportation is based upon even more fossil fuel.
And before I can holler ‘enough already’, there’s the pending problems related to fossil water (Dyer’s term) to consider and act upon.
Not only has the use of fertilizer grown (“global fertilizer use tripled between 1960 and 1975”) but “there was an enormous expansion of the world’s irrigated area. It has more than tripled since 1950.”
Some highlights from Dyer’s article follow:
- 10% of the world’s cropland is irrigated but that 10% provides about 40% of the world’s food
- most new irrigated land uses water from deep underground aquifers (or “fossil” water) which will eventually be pumped dry
- the world will eventually have to make do with the one-third of the land watered by the weather
- it won’t be enough
Though the world’s aquifers won’t all run dry at the same time, Dyer states most aquifers will be dry in 30 years, and some in the US are passed their peak already (e.g., Texas in 1978, California in 1997).
China and India, the two most-heavily populated regions in the world, are straining water resources as well at this time (grain for 175 million Indians is produced by over-pumping water; 130 million Chinese face a dwindling supply now for grain), Israel imports 98% of its grain now and Saudi Arabia will import 100% of its grain by next year.
[“Chinese fishermen on an almost dried up irrigation canal”: photo by David Gray, Reuters]
Rich countries and families will be able to pay when grain prices double from the current price (already we know that the average world price for grain soared by 71% in the last year), but not every country or family one is rich.
Already mounting debt throughout the world is a daily news story and the pile of solutions is getting slimmer by the minute. Is there a ‘bridge over troubled water’ for those who do not have the means to keep up with multiple rising costs? (Unfortunately, food is but one part of our budget).
Dyer concludes by saying, “Never mind what climate change will eventually do to the world food supply (although we will mind very much when it finally hits). The crisis is coming sooner than that, and it is quite unavoidable. We are living way beyond our means.”
Many will be tempted to say it’s just “Another Saturday night and I ain't got nobody” and that’s the extent of their problems.
If we collectively put off living under our means much longer, however, we may miss the satisfying opportunity to do even that.
Please click here to read more about our lovely debt situation.