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Oil and economic slavery in the 21st century

As everyone following news reports knows, life is becoming increasingly tough for most Europeans and Americans, as the rising oil and food prices continue to pressurize the high living standards and elevate nervous tension within the developed world. What are the causes of the crisis, as well as the perspectives for its development? As usual, the analysts' forecasts cover the entire spectrum of all possible opinions. In the meantime, simple quantitative considerations seem to provide a clear insight into the problem, although the emerging conclusion is quite unexpected: the developed world has literally become the economic slave of the domestic as well as, for the most part, of foreign energy sellers.

Traditionally, the slave is the one who works, while the slaveholder is the one who does nothing but lives on expropriating products of the slave's labor and keeping the latter on the verge of survival. In 2005, according to World Bank, the global gross domestic product was 45 trillion (1012) American dollars. This sum estimates the yearly work of the Earth's citizens. Let us now have a look at their energy expenditures. Taking the mean oil price in 2005 to be 55 USD/barrel, oil energy content 5.5 GJ/barrel and world energy consumption of 4.7 × 1011 GJ (1 GJ = 109 J), we obtain that the 2005 price of 1 GJ of consumed energy was around 10 dollars. Total energy expenditures of the civilization were in the order of five trillion dollars, or more than ten per cent of the global GDP.

It is not commonly shared knowledge, however, that the share of world's working population occupied in the energy sector is vanishingly small — being about one tenth of a per cent on a global average, it rises to no more than 1-2% in the biggest oil exporters like, e.g., Russia. It follows that over 10% of global GDP flows, through energy payments, to the economic sector which provides occupation for only 0.1% of the working population of Earth.

What does this mean? Since money stand for the goods produced, this means that a hundred times more goods (cars, fridges, PCs, mobile phones, etc.) are produced per every person occupied within the energy sector than per average Earth's citizen. Apparently, such enormous amounts of goods cannot be consumed or utilized by people working in the energy sector. It is therefore possible to use these goods to support a certain population (that can be rightfully termed "vacant"), who will have no need to work at all. Or such population can perform some economically meaningless activities unrelated to the task of keeping the civilization running. We are forced to conclude that, in its significant part, labor of the working population of the developed countries, which constitutes the most educated and technologically advanced stratum of world population, is used to support vacant population in various regions of the world. This is the essence of modern economic slavery. Obviously, with growing population numbers and appetites of vacant populations, the economic burden on the slaves will grow, and this is what we are today witnesses of.

This general picture is neatly illustrated by occupation and production statistics in the countries oil exporters versus developed countries, the latter all being oil importers with minor exceptions. For example, the number of non-working dependants per one worker in some Near-Eastern countries exceeds the corresponding European number by several times, while graduates from Near-Eastern universities make a 15:1 proportion of priests to engineers. In Japan death from "overworking" causes no surprise, while in countries oil exporters such a disease is simply unheard of. In Russia, in the absence of domestic industry, practically all daily products are imported in exchange for energy and metal resources produced by a few per cent of working population. The rest of the population, similar to that in other countries oil exporters, can be occupied with arbitrary activities as prescribed by the official bodies that distribute the oil income within the population. Generally, in its very best, the activities of a vacant population are economically uncompetitive; in the worst — directly aimed at undermining the civilization bases (terrorism). Those with eyes will see.

Modern slavery is peculiar in that the slaves (i.e., working population of the developed countries) are often formally still enjoying a higher living standard than the slaveholders (i.e., those who appropriate the products of the slaves' labor). The reason is straightforward though; it lies in the high population numbers of the slaveholders, as well as in their high birth rates. Relaxation of the need to work intensely and to compete economically makes a fruitful ground for religious and social encouragement of elevating birth rates in the vacant population. In the meantime, the slaves working to economic death cannot even reach the level of simply maintaining their population numbers. Reproduction becomes economically disadvantageous for them. Note, however, that if a country—oil exporter is wise enough to sustain a low population number, living standards in such a country rise to heavens. Norway provides a conspicuous example. It has a population of less than world's one thousandth, while it exports about two per cent of global energy, which is produced by only 1.5% of the working Norwegian population.

Legally, economic slavery of the 21st century is protected by the recognized property right over energy resources — within a given country as well as at the level of state sovereignties. The ownership right over production facilities and profit appropriation are conventionally considered as the cornerstones of market-based prosperity. However, those very mechanisms that constructively stimulate technological progress (the one who sells a more technologically advanced PC gets a greater profit) result in a dangerous economic destabilization when applied to life-essentials like energy. Ownership — whether state or private — over energy sources in the modern civilization could be compared to ownership over atmospheric air; economically, it produces the suffocative effect of a monopoly. Indeed, the civilization cannot but consume energy, in very much the same manner as a human being cannot dispense with air. For this reason energy prices are automatically elevated up to the critical maximum level which the civilization is still able to pay on the verge of economical collapse. In this situation it is not surprising that the developed countries appear so inefficient in solving the yet aggravating problems of the environment, climate, education, health care, transport, the developing world, etc. The entire economic surplus is given away to the slaveholders whose numbers and, hence, demands are steadily growing.

What is the perspective? If the above views were made available for discussion by the developed society and beyond, one might then think of centralized legal measures aimed at limiting the state sovereignties as well as private property over energy sources, using the threatened economic and social stability of the world as the reason. Then the energy prices could be globally regulated to remain economically sound. Similar measures are attempted to be taken to limit state sovereignties with regard to the development of nuclear power. Such a solution though would demand a considerable intellectual effort, a nearly insurmountable challenge for the modern society. Psychologically, citizens of the developed countries, with their many centuries' tradition of the economic leaders' identity, will find it extremely difficult to admit their current status of economic slaves. However, without such an analysis the crisis will be deepening spontaneously, with a glaring possibility of a new military conflict where the well-armed slaves will again attempt to get rid of their shackles with those of the slaveholders who still do not have nuclear weapons.

In greater detail the same topic is covered here.