Falling Demand for Oil: Crisis for capital, hope for humanity
by Al Engler - Dissident Voice
April 3rd, 2015
For capital in Canada and the U.S. the sudden drop in oil prices is a disaster. For humankind it is a signal that fossil fuel use must decline.
Thirty years ago scientists pointed out that the burning of fossil fuels was causing global warming. To prevent catastrophic climate change, carbon dioxide levels in the atmosphere would have to be kept below 350 parts per million, a level that could be maintained only if three quarters of known reserves of conventional fossil fuels were left in the ground.
Corporate capitalism in Canada responded by investing tens of billions in tar sands, fracking, and oil pipelines. U.S. capital invested even more in off-shore drilling and fracking. Governments provided fossil fuel corporations with tax breaks and subsidies. By 2014 atmospheric carbon dioxide levels over North America on some days exceeded 400 parts per million.
In the 1980s when science first drew attention to global warming, it was to be expected that some would claim this was merely a theory. Now, the hypothesis of human-caused climate change has been tested and measured. Increases in global temperature continue to be historically unprecedented. As predicted, glaciers and polar ice caps are shrinking. Sea levels are rising. Droughts and floods have become more frequent. Storms, rainfall, hurricanes have become more severe. Carbon dioxide raining down from the atmosphere increase ocean acidity; crustaceans from coral reefs to micro organisms are losing the capacity to reproduce, undermining the ocean ecosystems on which all sea life depend.
Climate change skeptics may have been eased to the fringes, but corporate capitalism continues to ignore the impact of carbon emissions.
For capital, profits from the exploration, development and transportation of coal, oil and natural gas are just too important. Profits in the automobile industry, air travel, agribusiness, and global trade depend on plentiful fossil fuels. Major financial institutions are heavily invested, directly and indirectly, in fossil fuels. In a time when most global markets for consumer and producer goods are stagnant and low interest rates have reduced the base return on capital, capital generally is dependent on profits from fossil fuels.
Unwilling to reduce dependence on fossil fuels, corporate interests in the U.S. and Canada insist that green energy is not a realistic alternative. To undermine expansion of green energy, they have persuaded federal governments to impose punitive tariffs on solar panels made abroad. They have persuaded states, counties, and utilities to deny local solar producers access to grids. Meanwhile, in China, India, Africa, Brazil, and even in some U.S. states wind and solar power is a growing source of electricity. Electricity from wind power will double by the end of this decade. With present technology solar power alone could replace all the electricity now provided by fossil fuels at no additional cost. As investments on wind and solar increase, the technology will advance, further reducing the cost and efficiency of green power.
To drive a wedge between industrial workers and environmentalists, corporate shills present green power as touchy feely, less industrial, less masculine than energy from fossil fuels. Yes, solar and wind are cutting-edge technologies. Many highly educated professional and technical specialists will be required in basic research, development and administration. Still, most employees will be engaged in manufacturing, transportation, installation and maintenance–traditional blue collar occupations that can be equally done by men and women. Work will be widely dispersed in all regions. By boosting employment, income, and markets, the massive expenditures required to convert to green energy would end the austerity promoted by capitalist interests. Employment and income will rise. Markets will revive.
The shift to green energy, motivated by human well-being, will have to be pushed from below. Although capitalist interests now have a death grip on political agendas, people acting together for the common good can counter capitalist influence. We are the vast majority. Industrial and service workers, professionals and technical specialists, students, the unemployed, pensioners all share a common interest in the continuation of the environments on which humankind depends. No more than five percent depend on marginal increases in profits.
Strikes, protests, boycotts, and civil disobedience can help speed up the shift away from fossil fuels. Community-owned utilities, cooperatives, and local capital can take initiatives. Electoral mobilizations can push federal, provincial, and state governments to shift to green energy and to provide funding for public transportation. Cities could be reconfigured to make it practical for people to walk and cycle to employment, services, entertainment and commerce. Publicly supported local food production could replace dependence on transnational corporate imports.
The funding required could in part come from excise taxes on fossil fuels, perhaps $50 a barrel, equivalent to the recent drop in the price of oil. Since capitalist profit is at the root of the problem, most of the revenues should come out of additional taxes on corporate income and private capital.
Al Engler is a long-time social activist, a retired towboat cook and trade union official. He is the author of books and numerous articles against capitalism and for economic democracy. Read other articles by Al.