Comment Economics has nothing to compare this to (Score 1) 1250
This isn't a case that can be explained by economics, because there's never been anything in the past to compare to. This isn't grain supplies or something like that which can easily be replaced. We're talking about the permanent decline of the single greatest resource that sponsors all the economic theories that exist.
All of modern economic thinking is based on the assumption of continual economic growth. Without this growth recession creeps in, followed by depression. And yet this required continual growth is physically sponsored by an ever-growing amount of oil, to power the ever-growing needs of the economy.
Take away the oil, you take away the mechanism for economic growth, simply. As the costs of food and transport grow, people find themselves tighter and tigher financially, and unable to depend on future potential income, borrowing declines sharply. Take away borrowing and you take away the injection of fresh money into the economy, and the whole things just spirals down.
It's not a pretty picture.
All of modern economic thinking is based on the assumption of continual economic growth. Without this growth recession creeps in, followed by depression. And yet this required continual growth is physically sponsored by an ever-growing amount of oil, to power the ever-growing needs of the economy.
Take away the oil, you take away the mechanism for economic growth, simply. As the costs of food and transport grow, people find themselves tighter and tigher financially, and unable to depend on future potential income, borrowing declines sharply. Take away borrowing and you take away the injection of fresh money into the economy, and the whole things just spirals down.
It's not a pretty picture.
