Conversation with Mother
(Page 7 of 11)
September/October 1986
By Lester Brown
Here in the United States, we have a wide variety of renewable energy sources, and we're in a position to develop each of them.
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MOTHER: Yet, with the recent drop in oil prices, I've heard it suggested that we eliminate the fuel-efficiency standards for cars. Is that likely to happen?
BROWN: The fuel-efficiency standards haven't been eliminated, but they are due to expire shortly. There are, however, many people who think they should be set much higher in the future than they've been in the recent past. What we're headed for, in all probability, is an oil shock in the early to middle 1990s that will be far more severe than any experienced to date. Sometime during that period, the world's going to wake up and discover that most of the oil in the North Sea, in the North Slope of Alaska, in Venezuela, in Indonesia, and in Nigeria is gone. At that point most of the remaining oil will be in a small number of OPEC countries in the Middle East-and suddenly that region will be back in the driver's seat, even stronger than before, and the world oil economy will become, once again, a seller's market.
MOTHER: In the meantime, the recent unprecedented drop in oil prices has been a real threat to the international banking system.
BROWN: Whenever the price of oil goes up or down rapidly, it puts a lot of stress on the international banking system. It's a very destabilizing and dangerous development. That, along with Third World debts that can't be paid and the bankruptcy of family farms, is creating tremendous financial pressures. The world banking system might be able to deal with any one of these crises, but if you get a lot of them together, at some point the survival of some of our financial institutions could be threatened. And it's uncertain whether the U.S. government would be willing or able to intervene on a sufficiently large scale to prevent a crisis should one threaten.
I have the feeling that we're moving into an extraordinarily difficult, complex period. I think we're faced with a financial day of reckoning in the not-too-distant future. And one of the things that we may be headed for as a result of the environmental deterioration, the mounting debt in the Third World, and the growing federal deficit is a redefining of national security. We may wake up to the fact that the ecological and economic threats to human security are greater than the military threat! Throughout most of the period since World War II, it's been possible for most countries to have both guns and butter, but that period may be coming to an end now, and there are many governments that can't have both.
MOTHER: But what country nowadays will choose butter over guns?
BROWN: It's true that when we look at the world economy over the past generation, we see one that's become steadily more militarized. In 1960, 4.6% of the world economy was devoted to the production of arms. By 1985, it had increased to over 6%. In real dollar terms, in 1940 world military expenditures totaled $400 billion. By 1985, they had increased to $940 billion. That's not a trivial amount of money. That sum exceeds the total income of the poorest one-half of mankind.
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