East vs West, 'Stuff' vs 'Finance'

As a military conflict rages in Ukraine between Russia and what the Russian government calls "the West" (apparently meaning NATO allies and particularly the United States), there is a parallel economic battle between "stuff" and "finance." Both categories are affected by economic sanction regimes imposed by each side. But there is a striking difference in what each side has to sell.

In advanced countries, the percentage of the total economy devoted to services has long exceeded that devoted to goods. This is a reflection of the increasing productivity of those working in manufacturing, mining, agriculture, forestry and fishing who make it possible for so many people to work in service industries. These raw materials and goods industries provide all the stuff those of us in the service economy require to stay alive and perform our services.

It is a testament to the remarkable rise in productivity of the raw materials and goods industries that in the United States, for example, the service sector accounts for almost 77 percent of all economic activity. In France, the percentage is about 70 percent. In Russia the percentage is a little lower, about 68 percent, which may reflect Russia's relatively large mining, forestry, and agriculture inputs to its economy.

But regardless of the percentage, all service industries remain completely dependent on the raw materials and manufactured goods sectors to function. That has become even more apparent in the wake of price increases on essential goods and disruptions of trade that have resulted from the Russia-Ukraine conflict due to economic sanctions by both sides in the contest.

Bruno Latour: A philosopher for our perilous times

French philosopher Bruno Latour died earlier this month at age 75. Those who are regular readers will know that he deeply influenced my thinking and honed my perceptive abilities. He was trained as an anthropologist and has been variously described a "science studies" scholar, a philosopher of science, a sociologist and just a plain old philosopher.

Of the many insights I absorbed from his work I mention four here which have been explicit or implicit in my regular pieces over the last 20 years. They are as follows:

1. Nature and culture are not two things; they are one. In his book We Have Never Been Modern Latour adopts the rather clumsy construction of "nature-culture." But such a lens enabled him to see that every era has had a nature-culture and that our "scientific" culture was not different in kind from societies of the past. These societies always had systems for understanding nature which were used by culture to integrate with the natural world. These societies were not "primitive" in the sense that they had no "science." They had what we would regard as a less sophisticated science. The discarding of the past, however, has left us poorer for we have thrown out the useful along with the outmoded—particularly some useful ways of seeing the world around us wholistically.

Taking a short break - no post this week

I'm taking a short break this week and expect to post again on Sunday, October 23.

Dutch dilemma: What is Europe willing to do for more natural gas?

Modern global society is steeped in the idea of trade-offs, the notion that one must suffer losses to obtain desired gains. This prepares the way for disingenuous leaders to explain why sacrifices are necessary to reach supposedly exalted goals. Usually those sacrifices are made by the powerless in society; they are certainly not made by the leaders who call for sacrifices nor by the wealthy and powerful who benefit from them.*

This coming fateful winter season in Europe is likely to include a lively debate about whether the Dutch should make a perilous trade-off on behalf of an energy-starved Europe. So far, the Dutch have been firm about closing one of the world's largest natural gas fields, Groningen, no later than 2024—even in the face of severe European gas shortages resulting from the loss of gas from Russian pipelines.

The reason for that firmness has to do with the damage earthquakes are inflicting on the buildings located above and around the field, earthquakes related directly to withdrawal of Groningen's gas. In the northeastern part of the country, some 1200 earthquakes have severely damaged 27,000 buildings to the point that they are uninhabitable. About 3,300 structures have been demolished. A 2015 study reported that 152,000 homes need to be reinforced. As a result the government has been reducing gas withdrawals to mitigate the problem with an eye toward closing the field. Closing the field also comports with the government's greenhouse gas reduction goals.

But, will the Dutch be able to withstand calls for increasing production from Groningen as the European winter arrives?

Ukraine, Russia and the blindness of war

Some things are easy to predict, the orbit of planets, for example. They adhere to well-established physical laws not subject to alterations by the whim of humans.

But any forecast that has to do with humans and the complex systems within which they live is bound to be problematic if not downright wrong. When humans engage in billions of daily interactions with other humans and the physical world, they become surprisingly unpredictable, especially when novel or unexpected interruptions interfere with the smooth operation of those interactions.

It might be simpler to say that peace is more predictable than war, and that would capture most of what global society is feeling today in the wake of the Russia-Ukraine conflict. Each side in the conflict—and we must now include NATO countries on the side of Ukraine against Russia—has made decisions based on expectations that proved to be utterly mistaken. Each side assumed that we live in something like a billiard-ball world in which a single action has a precise and foreseeable reaction.