As I write these words, it’s the Spring Equinox up here in the northern hemisphere. From today onwards, the days will be longer than the nights. The clocks will be going forward. The birds are singing, the flowers are opening, and people are traditionally starting to cheer up after the long dark winter.
Except that 2022 is a bit less cheerful than usual. It’s not just that the weather is weird – although it certainly is weird, with simultaneous heatwaves at both poles – or that there’s a major war happening in Eastern Europe. There are multiple serious issues besetting industrial civilisation right now. The price of oil, the life-blood without which globalism cannot function, is well over $100 a barrel, has been for months, and is showing no signs of decline. (Even before the Ukraine crisis it was north of $90, a fact which was not exactly on every front page.)
Vladimir Putin is the current object of media hysteria. It is remarkable how swiftly and completely he has eclipsed the Covid-19 pandemic as the monomaniac centre of attention. I am pretty sure I can remember a time when more than one thing was allowed to be happening in the world, but this has apparently ceased to be the case. Anyway, all the things that go wrong that we used to blame on the virus can now be blamed on Mr Putin instead.
If this strikes you as irrational, then you are correct. Many of the issues that are coming down the pike have nothing to do either with Covid-19 or Mr Putin or indeed the Tooth Fairy. For example: take food. Industrial agriculture depends heavily on artificial fertilisers. The major ingredient for these is ammonium nitrate. A lot of this is manufactured in China, and China has started to restrict exports of it, reserving its production for domestic use (weirdly, they prefer to feed their own people rather than make money). This started happening last year.
This is going to have a big impact on this year’s harvest. A lot of countries in the Middle East and North Africa rely on importing wheat from Russia and/or Ukraine, and they may be in for a second edition of the Arab Spring as bread prices are forced up – this is already happening. But it will be worse next year. I can’t imagine Ukraine will be bringing in a bumper harvest in 2022. We will discover the hard way that however much money you have you can’t buy something that ain’t there.
Or nickel. A lot of nickel comes out of Russia. It’s required for many industrial processes, such as the manufacture of stainless steel and of course batteries. You can’t magically replace it with cryptocurrency or tweets from Elon Musk or anything else; for the stuff we need nickel to do, you need actual physical nickel. The price of nickel has been going all over the shop, to the extent that the London Metal Exchange felt obliged to cancel an entire day’s trading recently. It’s one of those natural resources on which we depend and yet nobody really talks about it.
Or natural gas. Europe is heavily dependent on this both for direct use and indirectly for electricity generation. Much of that gas is imported from Russia. I don’t need to tell you which way the price of that is going. This is not happy news for energy-intensive industries – aluminium smelting, for example. Still, it’s not as if we use aluminium for anything important.
Or there’s the obvious knock-on effects of the price of oil. There are fishing fleets in Spain that are not sailing because they can no longer make money. Spain is also in the grip of a nationwide transport strike, with lorry drivers protesting the cost of diesel, which in turn is having adverse effects on the rest of the economy (those fishermen who have been going to sea can no longer dispose of their catch, for example). Unless you live in Spain, you probably haven’t been reading about any of this in your local paper.
Another issue for the Spanish fishing industry, incidentally, is the shortage of sunflower oil for canning purposes. The immediate cause is the Ukraine war, as sunflower oil production is largely centred there, but the larger cause is the mindset that assumes that the place for all of your eggs is automatically in the one cheapest basket. This brilliant thinking has led to the concentration of so much of US agriculture in the Central Valley of California, which is struggling with a multi-year drought, Again.
With expensive fuel, the world gets bigger again. Importing everything from the other side of the globe becomes a less attractive business model. Where businesses are operating on tight margins, like the Spanish fishermen, quite a small price rise can be fatal. At the risk of stating the obvious, the price rises we are seeing now are not small. And there’s not much prospect of this improving.
So we’re looking forward to a world in which multiple essential items – wheat not least among them – are going to be scarce, expensive, or downright unobtainable for many people. At the same time, their incomes are going to be squeezed still further, in the aftermath of the forgotten pandemic. This is how revolutions start, especially given the absence of even semi-competent political leadership in large parts of the world. (Biden? Johnson? Macron? Scholz? Hello, anyone at home?)
I fear particularly for the United States, a country riven by many divisions which have only deepened over the last few years, which continues to be addicted to oil (as George W. Bush so memorably put it), and which is also well-provided with heavily-armed people with military training. But violence could erupt almost anywhere. The extreme measures used again the Canadian truckers recently are a case in point. My own country, the UK, could very easily kick off.
Spring is traditionally a time of hope. I’m finding it quite hard to be hopeful about this year, or next. Still, in the immortal words of the late George Michael: “You gotta have faith.”
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