I’ll start off with the easy stuff, continuations of trends
already in progress.
1. Young people turn
urban. The under 30 crowd will
continue to flock to urban areas, eschew car purchases, bicycle in ever-larger
numbers, as well as walk, take transit and use a car sharing service from time
to time. This means in 2043,
50-somethings will be in much better health than they are today.
2. Oldsters turn
urban. Boomers between the ages of 50 and 70 will downsize, abandon
suburbia and head for urban areas where there is more to do and less lawn to
mow. They will bring their cars with them and then be grouchy they can’t park
anywhere.
3. Housing prices
uneven. Housing in urban areas on the US coasts will appreciate slightly on average
while housing in distant suburbs of the same cities will continue to lose value.
Up, up, up |
4. Some difficult
trends continue. As in 2012, in 2013 food stamp use will again increase in
the US, the average price for a gallon of gas in will again be higher than the
previous year, the Gini Index measure of inequality will again rise in the US,
and median real household income will again decline.
5. Turmoil in the Middle East and North Africa.
(Not a hard call!) Specifically, there
will be turmoil in countries that have recently transformed or are in the
process of transforming from net oil exporter to net oil importer. The exporter
to importer transition creates upheaval not only because an important source of
revenue dries up but also because precious hard currency now has to buy energy
imports, wreaking even more havoc with balance of payments. Middle East and
North African countries likely to encounter turmoil (or more turmoil) are Egypt,
Syria, Yemen, and Tunisia. Other countries that might experience turbulence are
Argentina, Uzbekistan, Indonesia, Malaysia, Vietnam, and the United Kingdom. Might
even see a little upheaval in Denmark.
2012 was painful enough |
6. Serious oil import
pain. These countries will drop oil
imports by more than 5% in 2013: Greece,
Portugal, Spain, Italy, Ireland, UK, Poland, Hungary, Bulgaria, and Syria. This
will largely be due to painful economic necessity and occur through drops in
passenger miles traveled rather than through investment in energy-efficient
mass transit. The countries in the graph above already dropped by 5% or more in 2012.
7. Moderate oil import
discomfort. These countries will
drop oil consumption by 1 to 5%: USA,
Belgium, Netherlands, Finland, Sweden, Austria, Germany, and France. In most of
these countries (except the US), wasteful oil use has already been curtailed so
consumption will drop primarily through increased investment in and use of
public transportation. This will improve the economic performance of these
countries. In the US oil consumption will drop through greater vehicle
efficiency, fewer miles traveled, and a moderate amount of increased public
transit use. To achieve the transportation efficiency of most European
countries, US oil consumption will eventually have to drop in half, and miles traveled
by private vehicles will eventually have to drop two-thirds. This will happen,
but not next year.
8. Still on the
upswing. Countries that will increase consumption by more than 1%: Canada, Australia, South Korea, Japan,
Mexico, Turkey, Vietnam, India, Brazil, Thailand, Argentina, Iraq, Venezuela,
Libya, Saudi Arabia, Qatar, Iran, Jordan, Turkmenistan. Most of these countries
are oil producers who have long subsidized oil sales to placate their
populations. (Once a country subsidizes anything, removing the subsidy is difficult.)
Some countries, such as Turkey, Brazil, Vietnam and Thailand, are still
expanding economically, have a lot of population, have historically used very
little oil, and get a lot of economic return from even small additional amounts
of oil used.
9. Solar booming in some places. California will continue to outpace the rest of the US in
rate of solar PV installation. Germany will continue to outpace both California
and the US for same.
10. The US will not
run a balanced budget in 2013. A hamster could predict this.
11. The Federal
Reserve will continue to monetize US government debt. The hamster’s sister
could predict this.
12. The US economy
will continue to slowly contract as households with at least one member
unemployed will “insource” domestic tasks rather than purchase/hire them for
pay. Outsourcing of shopping, cooking,
gardening, sewing, laundry and childcare, which caused apparent economic
expansion when women entered the work force in volumes in the 80s and 90s, will
become again part of the domestic, uncounted, economy. (The amount of real work
done, however, won’t change.)
13. Some will do
better than others. US cities that offer attractive alternatives to fossil
fuel-powered transportation—safe routes to walk and bike, electrified trams,
metros and buses—will be have stronger economies in 2013 than those that don’t
because less consumer spending will immediately leave their economies. (The
exceptions will be cities directly involved in the gas and/or oil business.)
Somewhat dicier calls:
1. Greece or Germany will leave the Euro. (One or the other.) If Greece goes, likely Spain will leave as
well.
2. Oil exports from Mexico plus Venezuela will
decrease as much as oil exports from Canada increase.
3. US consumption of oil and coal will drop by 5%.
US consumption of natural gas will increase by 4%.
4.
Each region of the US will have a period of
gasoline supply troubles, either due to weather, other natural disaster, or
refinery capacity. These incidents will cause shortages or gasoline prices at
the pump above $5/gallon.
5.
Japan’s economy will come apart at the seams, in
no small part due to having to import fossil fuels to meet a large portion of
their energy needs. (But this doesn’t mean their society will follow suit, seam-wise.)
6.
China’s economy will flatline, going neither
down nor up in 2013, although with their population, this means running pretty
fast just to stay in same place. 2014 is a question mark. China's smog and pollution issues will grow so dire that they will actually not increase coal consumption in 2013.
7. If the Middle East remains stable, US oil
production will plateau in 2013 due to high production drop off rate of tight oil
wells (oil production in North Dakota.) US production of natural gas will drop due to
reduction in natural gas well drilling and sharp well depletion rates.
8.
If the Middle East becomes chaotic enough to
disrupt oil production (possibly due to high worldwide grain prices resulting
from US Midwest drought and/or US corn ethanol production), oil prices will sky
rocket. This will cause oil that is currently
uneconomic to drill and pump in the US to suddenly become economic. In that
scenario, US oil production would increase while overall US oil consumption
would drop.
9. The deduction homeowners can take off their
taxes for mortgage interest will be reduced (possibly just for upper incomes) or
dropped altogether.
10. Fearing political backlash, Congress will still
refuse to raise the gas tax or even index it to inflation. Instead, road repair
and maintenance will continue to be paid for with debt. Individual states,
however, will begin to raise state gas taxes in 2013.
11. The
Midwest drought will raise the price of ethanol so much that everyone except
corn farmers will curse the mandated 10% ethanol content in gasoline. The
amount of corn going into ethanol will also raise the price of animal feed
which will raise the price of meat and dairy. However, if high grain prices actually
cause revolutions in oil-producing countries, ethanol may again seem cheap in
comparison to oil.
Medium term, the items below can’t continue because we will
no longer be able to afford the squandering of resources and/or absorb the harm
inflicted. One way or another they’ll be gone/kaput by 2018, but they may still
wreak havoc in 2013:
1. US spending 18% of GDP on health care. (Other wealthy countries spend 11.5%)
2. US spending 5% of GDP on military. (Other wealthy countries spend 1.5%)
3. US debt 106% of GDP
4. Ethanol
5. War on drugs
6. $1 trillion dollars in student debt
7. One third of Americans obese
8. 11% of US adults diabetic
9. Internal combustion engines (due to gross inefficiency--over 75% of energy input lost)
10. High fructose corn syrup
11. Coal-burning power plants
12. Freight shipment by methods other than water or rail (and perhaps electric truck for the last few miles.)
13. Average of 845 square feet of living space per person in the US.
14. Over-use of air conditioning and air conditioning of the outdoors
1. US spending 18% of GDP on health care. (Other wealthy countries spend 11.5%)
2. US spending 5% of GDP on military. (Other wealthy countries spend 1.5%)
3. US debt 106% of GDP
4. Ethanol
5. War on drugs
6. $1 trillion dollars in student debt
7. One third of Americans obese
8. 11% of US adults diabetic
9. Internal combustion engines (due to gross inefficiency--over 75% of energy input lost)
10. High fructose corn syrup
11. Coal-burning power plants
12. Freight shipment by methods other than water or rail (and perhaps electric truck for the last few miles.)
13. Average of 845 square feet of living space per person in the US.
14. Over-use of air conditioning and air conditioning of the outdoors
The above mean these parts of the economy will shrink/diminish
over the next five years: health care, prisons, brick and mortar college
education, military, corn farming, coal mining, diesel trucking, airfreight, air
transport, road building.
These areas will expand/increase over the next five years:
farming of all products other than corn, on-line education,
renewable energy, electrical power grid expansion and upgrade, rail and transit
construction and maintenance, rail and transit operation, rail freight, bicycles,
electric bicycles, energy-efficient housing, energy efficiency retrofits, housing near
transit/in urban settings.
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