March 29, 2006

Be warned: the end of cheap oil will kill suburban dreams

Posted in Irish Independent · 13 comments ·
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Every Saturday throughout the early 1960s, a dull drone could be heard over the Colorado plains. The light aircraft flew low, at around 2,000ft. Inside, the pilot plotted future roads, suburban housing schemes and new business parks. Ray Kroc was looking for cheap land and was planning a revolution for suburban America even before the suburbs existed. Kroc, the mastermind behind McDonald’s, soon graduated to helicopters and by the 1980s, the company was one of the largest purchasers of commercial satellite photography, using it to predict suburban sprawl from outer space

The story of the spread of American suburbs makes instructive reading, particularly in light of last week’s forecast by NCB stockbrokers that the population of Ireland – largely concentrated in greater Dublin – will grow to over 5.3 million 2020. Any resulting anxiety is made yet more acute by the fact that the vast majority of new building is going up in commuter towns and all roads are leading to Dublin.

The prospect of a rural Ireland characterised by concrete housing estates — with makey-uppy names such as Parkwood Way, Cedarview Downs and Mountain Pines or the Irish equivalent of Carraig Greenane, An Coille Mor or Ard na Greinne — is now a reality. For example, take population patterns in a county like Clare – for many the epitome of west of Ireland rural idyll with the Burren, Lisdoonvarna and the Cliffs of Mohir. Since 1996, 66% of the increase in the population has come from non-Clare people moving into new estates, reflection the suburban spread of Limerick to the south and Galway to the north.

As this process continues, these estates will not be serviced by a local town or village, but by clusters of shopping malls, all-night Spars and fast food joints which will be located on proposed motorway intersections. Many retailers are already ahead of the posse. In the same way as Ray Kroc surveyed the Colorado plains from the sky, Tesco Ireland employs five full time planners whose job is to buy up sites in new suburbs that are about to be re-zoned so that the Tesco footprint will lead rather than follow development.

Our development model is pure West Coast American and despite all our government’s rhetoric about spatial plans, transport 2021 and the like, the ‘facts on the ground’ suggest that Denver rather than Denmark is the blueprint for suburban development in Ireland.

Apart from the obvious implication for traffic, the suburbanisation of Ireland is likely to presage a fast food revolution. In the US in the 1960s, McDonald’s Inc realised that, as the amount of time spent in the car rose, people would eventually have to eat as they crawled through the daily commute. Fast food — instant, hot and very (or varyingly) edible — is made for the wheel of a car. The answer to the hungry commuter problem was simple: on the spot, disposable meals without any need for cutlery. Suburban sprawl, traffic and fast food soon went together. Today, an estimated 17% of all American food is eaten at the dashboard. This figure is likely to be replicated in Ireland in the nor too distant future – particularly with forecasts suggesting – not unreasonably – of 200,000 new cars on our roads for the next ten years.

This will lead to a serious weight problem. According to the national taskforce on obesity, 27% of eleven year old Irish boys and 29% of Irish girls are overweight and little Irish girls from five to eight are ballooning much quicker than boys. One in three is overweight. We go from toddlers to waddlers in a shockingly short period. And, more worryingly 11% of Irish seven year old girls are obsese.

But will it all turn out like this? The chief assumption in all economic forecasts is cheap energy. Affordable energy is lynchpin of our economic model. It underpins cheap money which finances investment which in turn raises our productivity and attracts in cheap immigrant labour which pushes demand and the economy further and farther. But what if this central assumption is false? What if the era of oil is over? What if we are moving rapidly into an era where oil production is about to peak? Imagine that we are facing the end of suburbia?

Geologists have been warning about the peak of oil production for many years. Many of them believe that the world’s oil production will peak in the next three years. 52 of the 99 countries that produce oil have passed their peak production. US oil production – the world’s main devourer of cheap energy – peaked in 1971. Equally, geologists worry that the stated oil reserves of the likes of Saudi Arabia might be overstated. In the same way as the CIA had a vested interested in over-stating the power and threat of the Soviet Union in the 1970s in order to boost its own budgets, many argue that the Gulf Sates overstate their reserves to inflate their importance in world affairs. Whatever the reason, the implications of “peak-oil” are enormous. They are epoch changing. Put simply, every assumption goes out the window. Even Dick Cheney believes that we are running down reserves by 3% a year and given the emergence of China and India – both huge consumers – the US Vice President estimates that world demand is rising at 3% per year. This implies that the price of oil is on an upward trajectory and the sky’s the limit. (Some of the world’s finest thinkers on peak oil will assemble in the Mansion House in Dublin for an important conference next Wed 5th April for information see www.energyfutures.ie)

When you take out transport costs and taxes, the world has being getting its energy for almost free for years. Cheap energy has been the basis of our civilization. Yes, there have been great strives in telecoms, the internet and communications of late, but the true facilitator of western prosperity world as we know it, is cheap oil and natural gas. In the next ten years, therefore, pessimistic geologists conclude that we could see the end of the great experiment that was suburbia, cheap food and passive consumerist societies.

Did you know that Ireland is the third most oil dependent economy in the EU and the seventh most dependent in the world? This means that we are severely exposed. Where would our new suburbs be without cheap petrol and what about our out-of-town housing boom with our large kitchens, under-floor heating and super-sized fridges? Where would we all be without the car? If oil prices sky-rocketed, not only would SUVs resemble the dinosaurs on the morning of extinction, but fast, cheap food might also be a thing of the past. The abundance of world food production is based on the success and cheapness of petrol-based fertilisers and pesticides. If the price of these increased dramatically, crop yields would plummet. What are the implications for consumer spending? If the geologists are right, a large rise in the price of energy would be the economic equivalent of a massive tax hike, reducing our disposable income and depressing spending.

Economists have in the main ignored the geologists which appears irresponsible. Maybe the reason for this is economists’ sometimes over-blown confidence in technology and its ability to use energy more sparingly. But if the world realises that the resource is running out, panic will set in, rendering those counties that have oil such as Iraq, Iran, Saudi Arabia and Venezuela much more volatile.

The prospect of oil production peaking in 2010 should focus all our minds on the fact that we have had a pampered time in the past few years and that the great, affluent suburban era may now be faced with it first real challenge for which there are no easy fixes.


  1. paraic

    Buchanan is no neo-con. He is anti-neo-con. His is the strongest voice
    against the neo-cons in what is now called the paleo-conservative movement.
    He considers the neo-cons to be traitors.

    Willie C, it is not any kind of logic to attack an argument with whataboutary.
    Either Buchanan is right, ot he is wrong in his article regardless of
    mentionsnot America’s deficit, outsourcing and trade deficit in that particular
    piece ( he mentions these issues all the time in the American Conservative, in
    fact, and is hostile to the deficit, to outsourcing, and immigration).

    The article stands on it’s own measure, and is clearly correct.

  2. Dan Hayes

    David & Co.:

    I was very impressed with some of your responders knowledge
    of Paleoconservatism. Actually a lot more knowledgeable
    than most of America’s self-proclaimed and self-anointed
    politically astute. And for those of you who want to learn
    more about this exotica, you are referred to the following:
    Chronicles Magazine, The American Conservative Magazine,
    The Occidental Quarterly, the writings of the late Sam
    Francis, Vdare.com, antiwar.com, and of course Pat Buchanan.

    I’ll be in Ireland this August, monitoring it’s progress on
    its very own threadmill to oblivion!

  3. copernicus

    I’ve long thought that what we’ve been doing to agriculture
    is short-sighted in the extreme. Not that it was ever
    particularly diversified in this country in the first place.
    Beef, beef and more beef, and milk, milk and more milk.

    Supermarket profits are based on mass and specialised
    farming and the cheap food they provide on inexpensive
    freighting over tens of thousands of miles. It seems
    counterintuitive that it is cheaper to produce so far away
    from where the food will be consumed and it is because
    (setting aside issues of labour costs) of overuse of a
    scarce resource – oil – and environmental damage. There is
    also a medium-to-long term issue of food security, in my
    humble opinion.

    There was an interesting committee meeting in the Oireachtas
    a couple of years ago in the context of Kyoto commitments
    and peak oil etc at which it was suggested that not only
    will the costs of commuting from the ‘burbs or
    strip-developed, one-off rural dwelling to work/school and
    play increase as fuel costs rise, but you will more than
    likely be taxed for the carbon emitting consequences of your
    poor geographical choices a) for your cars and b) excessive
    domestic energy consumption.

    On mature reflection, those million euro city centre
    penthouses may start to look like rather reasonable little
    bargains in the next couple of years.

  4. mick

    will the market not result in alternative energies being
    mass produced ? theres enough alternatives to oil to allow
    for similar levels of economic activity ,once oil stayed
    over 150dollars a barell for a year or two many other
    energies would become economically viable.i dont see peak
    oil causing any sort of massive recession or massive
    adjustment in our way of life but we do need to become
    more energy efficient and promote locally produced food
    etc.

  5. Pete

    We have definately had a pampered time for a few decades
    now, thanks to almost free energy. Most people have no
    concept of the amount of energy they casually consume – I
    once saw a great demo where a portable TV was connected to
    a bicycle-powered generator, and most people could
    *barely* keep the TV running. Boiling a kettle would have
    required at least 20 people pedalling hard. Free energy
    has lead to some crazy situations, like the fact that
    today in Tesco’s it was much cheaper to buy onions grown
    in Spain than ones grown in Ireland, and a few minutes ago
    I ordered a book from amazon.com for half what it would
    cost from amazon.co.uk, including shipping costs.

    The end of cheap oil will certainly end alot of things
    that we take for granted, like affordable air travel, and
    maybe cheap food (not something I know about), but it
    won’t kill the suburbs, because it won’t kill cars.

    Airplane designers spare no expense in making planes as
    fuel-efficient as possible, they’ve already used almost
    every fuel-saving trick in the book, and there’s no
    realistic prospect of running planes on anything but oil
    anytime soon. The same cannot be said of cars. There are a
    HUGE number of known tricks waiting in the wings that can
    massively improve the fuel efficiency of cars. They
    haven’t been widely used yet because they either make the
    car more expensive to buy, or more complex to operate, but
    as the price of oil rises consumers will become more
    willing to accept the extra cost or inconvenience. The
    success of the Toyota Prius Hybrid is a great example,
    after 30 years of car makers telling us that they
    were “squeezing every last mile from the tank”, it
    instantly doubled fuel efficiency. And it’s only the
    beginning. Imagine a hybrid diesel car with an insulated
    ceramic engine, seperate compression, combustion and
    expansion chambers, multiple injection points, thermo-
    electric recovery of exhaust heat, variable valve timing,
    water injection into combustion chambers etc. etc. (I
    could go on ad nauseum), installed in a car with an
    extremely lightweight aluminium body with a truly
    aerodynamic shape, covered in solar panels, on narrow
    tyres, with brakes that generate electricity instead of
    heat. And how about a computer that controls the speed of
    the car up and down hills for maximum fuel efficiency,
    allowing for head or tail winds? Again, etc. etc. It’s all
    existing technology, prohibitively expensive and
    inconvenient at current oil prices, but in the future??

    If oil really does run dry, that still won’t kill cars.
    They’ll just go electric. The batteries and motors
    required to make practical electric cars are already
    commercially available, but too expensive to compete with
    engines in a cheap-oil world. In a no-oil world, they’ll
    get their power from another existing technology, the
    local nuclear power station, and the suburban dream will
    continue.

  6. Garry

    Be warned: the end of cheap oil will kill cheap flights.

    http://en.wikipedia.org/wiki/Peak_Oil

  7. Paul

    So what you are saying is that the sky is falling again
    today.

  8. JimBob

    The sky won’t fall today but tomorrow is going to be very
    different.
    Good article here from Pat Buchanan on The death of
    eurosocialism:
    http://www.wnd.com/news/article.asp?ARTICLE_ID=49522

  9. willie c

    Pat Buchanan is a raging neo con! read his article – its
    ridiculous ! its like, europe is crap and america is great -
    we told you so – our system is better than yours – the
    article is actually full of inacuracies – no country in
    Europe has birth rates which can sustain them – European
    regimes take 40 percent or even 50 percent of the economy
    in taxes…

    it childish in the extreme – this type of a yank just loves
    getting one over on europe – no mention of US budget
    deficit – their oil dependency and a host of other things! -
    problem is he is widely listened to over there in that
    fantasy land

  10. JimBob

    Pat Buchanan is no neo-con. He is an old style conservative.

    He is pro American rather than anti-European. He doesn’t
    belive in bugdet deficits or the US getting involved in wars
    overseas that doesn’t directly affect it. If he had his way
    he would pull out of Iraq tomorrow and close most of the US
    bases overseas, inc the ones in Europe.

    He is also a trade protectionist and is right wing on social
    issues. While all his opinions don’t directly to Ireland,
    some are very relevant.

    He right about the birth rates:
    http://news.bbc.co.uk/1/hi/world/europe/4768644.stm

    Here’s a list of his articles:
    http://www.wnd.com/news/archives.asp?AUTHOR_ID=185

  11. Duncan

    Finished reading the Long Emergency the night before last
    and just decided to find out if you’d done any articles on
    the matter of oil depletion. You might be interested in
    checking out the Kinsale Energy Descent Plan – I haven’t
    had a chance to examine it as my pc’s on the blink
    (typical, and that’s before the power black outs
    begin…), but I was heartened to think that some people
    in Ireland are trying to anticipate what could (and after
    reading that book I’m tempted to say ‘will’) put an end to
    western civilisation as we have known it over the past 150
    years. Smaller cities, smaller towns, a restoration of the
    distinction(division?) between rural and urban, and
    greater local democracy – I tell ya, it’ll be a different
    Ireland – especially since the last time those conditions
    prevailed for an extended period of time, we were ruled
    from London, or at best had just thrown off the yoke of
    that particularly domination. For instance, since
    political independence in the south, we’ve had to operate
    in a wider global environment dominated by a legal system,
    language and social, economic and cultural values that
    originated, one way or another, in England. Independence
    in anything other than a formal, constitutional sense was
    thus greatly attenuated. However, in a Long Emergency,
    that dominance of Irish culture by this anglophonic mass
    media proxy may dissolve, allowing for a real challenge,
    for the first time in a number of centuries to the
    cultural preeminence of English and wider British society.

    A few other points spring to mind – if and when the
    largely English-speaking fuel guzzling globalising economy
    fails, and if most work, trade and living is done on an
    increasingly and intensely local and regional basis, will
    we see a resurgence of belief in the practicality and
    necessity of reviving the Irish language as the everyday
    spoken language of many communities in Ireland? And will
    Christian religious leaders, be they Catholic, Anglican or
    Presbyterian, recover their authority and power within
    society at large? As an Irish pagan, I would welcome the
    first, but feel some trepidation at the prospect of the
    second! Also, how long will services such as our mass
    media operate? Mass entertainment is doomed, it seems, as
    cinema will probably go, as well as cds. Will RTE still
    exist? And will this vacuum inspire then, a new
    renaissance in more traditional art forms such as theater,
    dance, poetry recitation, song composition and recital? I
    guess most seriously of all we may have to say goodbye to
    mcwilliams.ie, but then…we all have to make sacrifices,
    eh?

  12. Deco

    The one thing that has been ommitted is that fact that
    demand for petroleum based fuels is going up, while supply
    is static. This results in a persistent gaining price rise.
    €60-€70 a barrel for another 6 months. Then up to €80-€90
    for two years and so on.
    I don’t see an effect of the endofsuburbia.com type
    encroachment yet on society. And the Toyota Prius and
    similar innovations from Honda and other car companies will
    change things no doubt.
    However what really should matter is the broadband issue.
    If it is costly to use the car, then surely it should make
    sense to have a broadband option in more of the commuter
    belt and provincial towns.
    In fact I think that the real technology dynamic should
    occur here. We have seen in the last 30 years how
    electronics makes progress on a completely different scale
    to mechanics, and therefore telecommunications should keep
    making the biggest changes and not the auto sector. Most
    auto makers are in the research phase concerning their high
    impact proposals. However in telecommunication the change
    generation tends to require less time.
    And this will impact the suburbs in a reverse way, by
    actually levelling the playing field between low cost and
    high cost countries and thereby moving jobs to lower cost
    countries. That is the real future.
    In this situation, our resource hungry infrastructure will
    be sweating losses and cost massively. Public transport
    will be more frequently used, and more costly to operate on
    a per KM basis. I don’t know how this will affect personal
    freedom, or human sociability.

  13. David

    I think we tend to ignore the fact that the industrial engine is built on cheap oil, not just cars, boats, planes but pretty much everything we consume has it’s origin in oil. So that toothbrush you’re using this morning after that perfect cup of coffee are connected in the same system that will grind to a halt once oil goes away. Our opportunity here is to immediately scale up renewables in the industrial complex and looking to biomimicry for simple solutions to complex problems..think blade of grass as the most efficient solar panel and you might get my drift. We should also approach this problem from the consumption angle, we must address this as both a means to reduce our dependency on oil and the waste we produce. When it takes 400 years to degrade a plastic bottle in direct sunlight perhaps we should realise that we’re using the wrong fossil fuel…our ancestors won’t thank us for our short sightedness.

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