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Podcast - Nate Hagens The Great Simplification with Daniel Schmachtenberger

Mar 19, 20246 min read

Episode 1 - https://youtu.be/3bxzo79SjpE Episode 2 - https://youtu.be/Nkv5mpBA8o4

Related: Daniel Schmachtenberger | economics | Ecology | Energy | Course - Peak Prosperity

Episode 1

Energy blindness

Energy blindness - tech , energy, money, growth Tech is dependent on energy, once we don’t have this much cheap energy, our use of technology will change dramatically

  • Energy is the currency of life

    • Biological organisms thriving when they can capture more energy than they use
    • if you don’t have energy surplus as an animal you can’t reproduce and thrive
    • applies to human systems too (GDP growth almost perfectly correlated to energy use)
    • storing food with the advent of agriculture allowed us to have energy surplus and dedicate efforts to other purposes (warriors, priests, artists, philosophy)

  • GDP is a measure of our energy use. Everything produced requires energy

  • growth obligations on the economy is an obligation of energy extraction

    • most product we consume could be made by substituting materials
      • everything relies on energy

  • infinite exponential economic growth cannot continue given the limited supply of hydrocarbons on the Earth

Why Improve energy use efficiency Is Not Enough

Jevon’s Paradox

  • As energy efficiency increases, paradoxically, humans start using even more energy, have a bigger impact on the planet, not smaller.
    • Demand side: things becomes cheaper, more available, more people can buy more
    • Supply side: it becomes profitable to create new products that weren’t profitable before - more markets open up

Can We Switch Everything to Renewables?

  • Renewables are growing extremely fast, yet the relative amount of fossil fuel energy used is almost the same as 50 years ago
    • The economy and energy demands have grown

3 Reasons Why Replacing all eneregy with renewable is problematic

1. We need Fossil Fuels to make Renewables + Low ROE

Currently it is not possible to operate mines purely on electricity. Diesel is needed - so to produce renewable energy tech it is needed to use oil.

ROE: Return on Energy - energy obtained from the lifecycle of that energy system compared to the energy required to build/extract it.

It used to take 1 barrel of oil to extract 100 barrels of oil (100:1 ROE). With solar and wind, today the ROE is 12:1 (accounting for intermittence, the ROE is closer to 4:1), while coal is 8:1.

2. Energy quality is not comparable (density, transportability, storability)

Fossil fuels are as if they come with their own battery - the oil is itself the energy storage. For renewables, you need to figure out the storage part with more extraction (batteries)

Potential vs Kinetic Energy

Potential energy: stored energy in any object or system ready to be used. Not relying on the environment around it (e.g. air, sun or height) - can be easily transported

  • Oil is particularly easy and cheap to transport (and energy dense)

Kinetic energy: Energy is relative to other objects present in its immediate environment.

Only 20% of our energy use is electricity. The remaining 80% couldn’t currently be replaced by renewables (cargo ships, mining operations, heating oil). In addition parts of the oil extracted are key components for manufacturing (concrete, plastic, many materials…), so even if we stopped using gasoline for energy we’d still need the same amount of oil for manufacturing and we wouldn’t know what to do with the gasoline

True Price of Energy

  • The main energy concern of our times is climate change caused by dirty energy sources

  • Another energy issue is that we’re running out of hydrocarbon stores

    • ==we’re underpaying and overconsuming the main ingredient for our economy to run==

  • Beyond GHG emissions, there are many externalities associated with energy

    • Environmental damages from mining
    • Spills and toxic wastes
    • Geopolitical instability and conflicts

  • The price we pay for energy does not include any of its societal costs (externalities), causing us to overconsume it

    • If we were to include externalities into energy prices, there would not be a single profitable industry

Advanced Policy

  • We’re not going to voluntarily de-grow, there’s too much momentum in the system to continue growing
    • We will be forced to shrink once we’re not able to cover these issues with debt, artificially low interests and bail outs
    • Advanced Policy - anticipate what might happen and design policies (and gather support) that make our system bend and not break
      • One idea is to tax non-renewable materials to include the true cost of each material (proposing to remove tax on labor to make up for it)

Episode 2

Episode 3

If you want an open society where everyone gets to participate in choice-making then everyone has to do a good job at sense-making (and meaning-making)

Risk with Utilitarian ethics:

If my goal is harm reduction, I become willing of doing harm if doing so will prevent “bigger” harm from happening. The issue is that quantification infuses a false sense of security, so it justifies doing fucked up things, as long as I am (potentially mistakenly) sure that my solution involves less harm.

It is easy to come to catastrophic conclusions that aren’t true

Doomers have the same premature certainty bias that optimists have

Projecting trends into the future can lead to doomerism, but it misses the possibility of regime shifts

  • if the fetus continues on the trend, growing and absorbing nutrients from the mother, it ends up killing her and killing itself. There’s a phase shift, that is unpredictable by looking at the single trend (birth) that allows the system to not self-destruct
  • similar examples of the chrysalis turning into butterfly and the bird breaking the egg where it developed

It’s easy to say that we’re all fucked and give up, or to say that human ingenuity will solve climate change, so we don’t need to worry. It is much harder to sit with the uncertainty of our situation, and yet still try to contribute despite the infinite complexity (Embrace Uncertainty).

post tragic view: **committed to being in service of the sacredness of life whether you can succeed or not. Cognizant of all the tragedies (and holding them), we still look for solutions, while operating with the sacredness of life at the center

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