Link: http://gregor.us/policy/limits-to-keynesianism/Every once in awhile, I need to remind myself that The Downward Spiral is intended, first and foremost, to be a Peak Oil blog. Sometimes, I get so wrapped up in crabbing about politics, government, the media and related stupidity that the Peak Oil issue tends to fade into the background.
So today, I'm rectifying the situation by posting the above chart from the excellent Gregor.us blog showing the world's oil production for this past decade (mbpd stands for Millions of Barrels Produced Per Day). As you can see, oil production peaked in 2005 and has essentially been flat ever since. If you want to know why the governments of the OECD countries have been so desperately trying to pump up their economies with massive amounts of borrowing in recent years, look no further than the above. It also demonstrates exactly why they will fail, as debts cannot be serviced if the economy does not grow, and the economy will not grow unless the supply of available energy grows. It really is just that simple.
At this point it remains uncertain as to how long the world will continue to bump along this oil production plateau before finally entering terminal decline. A number of of the most knowledgeable analysts, including Tom Whipple, have estimated that it will occur beginning in 2014. If so, we will likely experience the continuation of "extend and pretend" by OECD governments for a few more years before the shit really starts to hit the fan.